The Oriental Insurance Company ... vs Smt Jaibunbi Bulambeg & 2 Others
2015 Latest Caselaw 570 Bom

      fa473.03.J.odt                                                                                                             1/12

                     IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                               NAGPUR BENCH, NAGPUR




                                                                                                               
                                        FIRST APPEAL NO.473 OF 2003




                                                                                 
                The Oriental Insurance Company 
                Limited, Branch Dharampeth, Nagpur,
                through Divisional Manager, Nagpur
                Divisional Office - II, Kanoria House,




                                                                                
                Civil Lines, Nagpur.                   ....... APPELLANT

                                                 ...V E R S U S...




                                                            
     1]         Smt. Jaibunbi w/o Gulambeg,
                Aged about - 68 years,
                                   
                Occupation - Household.

     2]         Nisarbeg s/o Gulambeg,
                                  
                Aged about - 17 years,
                Occupation - Student.

                Respondent No.2 is minor through his
      

                natural guardian mother i.e. the
                respondent No.1, resident of Kelzar,
   



                Tahsil Selu, District Wardha. 

     3]       Smt. Kamal Prabhakar Renge,
              Aged Major, resident of Old Bhandara 





              Road, Hansapuri, Nagpur.                           ....... RESPONDENTS
     ----------------------------------------------------------------------------------------------------
              Shri D.N. Kukday, Advocate for Appellant.
              None for the Respondents.
     ----------------------------------------------------------------------------------------------------





                CORAM:  R.K. DESHPANDE, J. 

                Date of Reserving the Judgment: 21 st 
                                                     November, 2015.
                Date of Pronouncing the Judgment: 26   th
                                                          November, 2015.

     JUDGMENT

1] In the Claim Petition No.575 of 2002 filed under Section

166 of the Motor Vehicles Act, the Motor Accident Claims Tribunal at

fa473.03.J.odt 2/12

Nagpur has passed an award on 27.03.2003, in favour of the dependents

of the deceased namely Nazir Beg, for a compensation of Rs.3,25,150/-

with 9% interest from the date of filing of the petition and further at the

rate of 12% per annum from the date of award till its realization, for

failure to deposit the amount within a period of 45 days. The owner of

the vehicle and the Insurance Company both are held liable jointly and

severally, to pay the amount of compensation. The Tribunal has held that

the deceased was working as a driver on the vehicle i.e. Tata Sumo

bearing registration No.MH-31 H-5869 owned by the respondent No.2

and he died on 06.12.1997, as a result of the vehicle turning turtle.

The Tribunal has held that the dependents of the deceased are entitled

for compensation even though the deceased died because of his own

negligence resulting in occurring of an accident. This appeal is by the

Insurance Company only and not by the owner of the vehicle.

2] Shri Kukday, the learned counsel appearing for the

appellant - insurance company has urged that the claim under Section

166 of the Motor Vehicles Act, at the instance of the dependents of the

deceased driver of the insured vehicle dying because of his own rash and

negligent driving, is not covered. He further submits that the Tribunal

has committed an error in holding that the deceased was employed as a

driver by the respondent No.3, the owner of the vehicle in question i.e.

Tata Sumo bearing registration No.MH-31 H-5869. He further submits

fa473.03.J.odt 3/12

that the deceased was a friend of the son of the respondent No.3 and his

risk was not covered by the policy in question relied upon by the

claimants. He further submits that there is no evidence on record to

show that the deceased was a paid driver and was getting monthly salary

of Rs.2000/- as has been fixed by the Tribunal. He has further urged that

the Tribunal has committed an error in granting penal interest at the rate

of 12% per annum from the date of petition till its realization upon

failure of the appellant to deposit the amount of compensation within a

period of 45 days from the date of judgment.

3. None appears for the respondents and on the basis of the

submissions made the following points fall for the determination in this

matter:

Sr. No. Points Findings

1. Whether the Tribunal has committed an error in Yes holding that the deceased Nazir Beg was employed by the respondent No.3 the owner of

the vehicle i.e. Tata Sumo bearing registration No.MH-31 H-5869 ?

2. Whether the Tribunal committed an error in Yes holding that the deceased was getting monthly salary of Rs.2000/- ?

3. Whether in the facts and circumstances of this No case the claim petition under Section 166 at the instance of the dependents of the deceased was maintainable for compensation on account of death of the deceased caused due to his own rash and negligent driving ?

       fa473.03.J.odt                                                                                                             4/12


          4.        Whether   the   Tribunal   committed   an   error   in     Does not

awarding penal interest at the rate of 12% per survive, in

annum from the date of filing of the petition till view of its realization, upon failure to deposit the findings on amount of compensation within a period of 45 earlier points

days from the date of judgment ?

4] As to point Nos. [i] and [ii]: The burden of proof to establish

the fact of employment of the deceased with the respondent No.3 on

monthly salary of Rs.2000/- lies upon the claimants. The claimants have

specifically averred in paragraph 22 of the claim petition that on

06.12.1997 at about 12:00 p.m. (which is the date and time of the

accident). The deceased was in the employment of the owner of the

vehicle to ply the said Tata Sumo bearing registration No.MH-31

H-5869 on monthly salary of Rs.2000/- and was driving the vehicle

under the authority and permission of the owner. The owner has filed

written statement and has denied his averment. The Insurance Company

also denied this fact by filing written statement. The mother of the

deceased entered the witness box and has stated that the deceased was a

driver of the vehicle and was getting monthly salary of Rs.2000/- from

the owner. Except this, there is no other evidence placed on record to

show that the deceased was employed as driver on the Tata Sumo

bearing No.MH-31 H-5869, owned by the respondent No.3. This witness

has stated in her cross-examination, at the instance of the Insurance

Company and also of the owner of the vehicle that the son of the owner

fa473.03.J.odt 5/12

was a friend of the deceased and she has not produced any document

showing her son's employment with the owner of the vehicle. The fact

that the deceased was driving vehicle in question at the time of an

accident is not disputed. There is no document produced showing

monthly salary of the deceased, if he was employed. The respondent

No.3, the owner of the vehicle has not entered the witness box to

depose. In the light of these pleadings and evidence on record, the

Tribunal has committed an error in relying upon the sole testimony of

the complainant which is not corroborated or supported by any

documentary or oral evidence brought on record, to hold that the

deceased was employed as a driver by the owner on monthly salary of

Rs.2000/- on the vehicle Tata Sumo No.MH-31 H-5869. The finding to

that effect recorded by the Tribunal cannot therefore, be sustained. The

findings on point Nos. [i] and [ii] are therefore, answered in the

affirmative.

5] As to point No. [iii]: Shri Kukday, the learned counsel

appearing for the appellant has relied upon several decisions of the Apex

Court for the proposition that claim petition under Section 166 of the

Motor Vehicles Act, at the instance of the dependents of the deceased

driver of the insured vehicle dying because of his own rash and negligent

driving, is not covered. In the judgment of the Apex Court in the case of

Dhanraj v. New India Assurance Co. Ltd. and another reported in (2004) 8

fa473.03.J.odt 6/12

SCC 553, the question considered by the Apex Court was, whether a

comprehensive policy would cover the risk of injury to the owner of the

vehicle also. On facts it was held that it has not been shown that the

policy covered any risk for injury to the owner himself. In paragraphs 8

and 9 of the judgment, it has been held are as under:

8. Thus, an insurance policy covers the liability incurred

by the insured in respect of death of or bodily injury to any person (including an owner of the goods or his authorised

representative) carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle. Section 147 does not require an insurance

company to assume risk for death or bodily injury to the owner of the vehicle.

9. In the case of Oriental Insurance Co. Ltd. v. Sunita

Rathi it has been held that the liability of an insurance company is only for the purpose of indemnifying the insured

against liabilities incurred towards a third person or in respect of damages to property. Thus, where the insured i.e. an owner of the vehicle has no liability to a third party the insurance company has no liability also.

It is thus, apparent that where the comprehensive policy covers the

liability incurred by the insured in respect of death of or bodily injury to

any person (including an owner of the goods or his authorised

representative) carried in the vehicle or damage to any property of a

third person caused by or arising out of the use of the vehicle,

Section 147 does not require an insurance company to assume risk for

death or bodily injury to the owner of the vehicle. The liability of an

fa473.03.J.odt 7/12

insurance company is only for the purpose of indemnifying the insured

against liabilities incurred towards a third person or in respect of

damages to the property. Where the insured i.e. an owner of the vehicle

has no liability to a third party the insurance company has no liability

also.

6] The Apex Court in its decision in the case of Oriental

Insurance Co. Ltd. v. Jhuma Saha (Smt.) and others reported in 2007 (9)

SCC 263, was considering a question whether the deceased himself being

negligent, the claim petition under Section 166 of the Motor Vehicles

Act, would be maintainable. Paragraphs 10 and 11 of the said decision

being relevant are reproduced below:

10. The deceased was the owner of the vehicle. For the reasons stated in the claim petition or otherwise, he himself was to be blamed for the accident. The accident did not

involve motor vehicle other than the one which he was driving. The question which arises for consideration is that the deceased himself being negligent, the claim petition under Section 166 of the Motor Vehicles Act, 1988 would be maintainable.

11. Liability of the insurer Company is to the extent of indemnification of the insured against the respondent or an injured person, a third person or in respect of damages of property. Thus, if the insured cannot be fastened with any liability under the provisions of the Motor Vehicles Act, the question of the insurer being liable to indemnify the insured, therefore, does not arise.

It is thus, apparent from the aforesaid decision that if the deceased

fa473.03.J.odt 8/12

himself is to be blamed for the accident without involving the motor

vehicle other than the one which he was driving, there is no liability of

the owner of the vehicle who is not a tort-feasor and consequently, the

insurance company also cannot be held liable.

7] In the decision of the Apex Court in the case of United India

Insurance Co. Ltd. vs. Davinder Singh reported in (2007) 8 SCC 698, it has

been held in paragraphs 10 and 16 are as under:

10. It is, thus, axiomatic that whereas an insurance

company may be held to be liable to indemnify the owner for the purpose of meeting the object and purport of the provisions of the Motor Vehicles Act, the same may not be necessary in a case where an insurance company may refuse to compensate

the owner of the vehicle towards his own loss. A distinction must borne in mind as regards the statutory liability of the

insurer vis-a-vis the purport and object sought to be achieved by a beneficent legislation before a forum constituted under the Motor Vehicles Act and enforcement of a contract qua contract before a Consumer Forum.

16. Different considerations would arise in a case of this nature, as the Consumer Forum established under the Consumer Protection Act, 1986 was concerned only with a question as to whether there was deficiency of service on the

part of the appellant or not. A right on the part of the insurance company not to pay the amount of insurance would depend upon the facts and circumstances of each case. It in certain situation may be bound to pay the claim made by the third party; if the same is filed before a forum created under the Motor Vehicles Act. But defence may be held to be justified before a different forum where the question raised is required to be considered in a different manner.

fa473.03.J.odt 9/12

The statutory liability of an Insurance Company is held to be restricted to

the damage caused to a third party, as a result of rash and negligent

driving of an insured vehicle. The Insurance Company may be held to be

liable to indemnify the owner for the purpose of meeting the object and

purport of the provisions of the Motor Vehicles Act, but the same may

not be necessary in a case where an insurance company may refuse to

compensate the owner of the vehicle towards his own loss. A right on the

part of the insurance company not to pay the amount of insurance would

depend upon the facts and circumstances of each case. It in certain

situation, may be bound to pay the claim made by the third party; in the

forum created under the Motor Vehicles Act. But it may justify its

defence before a different forum where the question raised is required to

be considered in a different manner. Under Section 166 of the Motor

Vehicles Act, the negligence on the part of the driver of the offending

vehicle is required to be proved resulting in an injury being caused to a

third person.

8] On the basis of the ratio of the aforesaid decisions the

following principles can be laid down:

(a) Under Section 166 of the Motor Vehicles Act, the

negligence on the part of the driver of the offending

vehicle is required to be proved resulting in an injury

fa473.03.J.odt 10/12

being caused to a third person, which will attract the

liability of the insurance company to indemnify the

owner of the vehicle.

(b) Where the insured i.e. an owner of the vehicle has no

liability to a third party or the owner is not the tort

feasor, the insurance company has also no liability.

(c)

If the deceased himself is to be blamed for the accident

without involving the motor vehicle other than the one

which he was driving, there is no liability of the

insurance company to indemnify such risk unless it is

covered by the terms of the contractual policy.

(d) The question as to maintainability of an application

under Section 166 of the Motor Vehicles Act to enforce

the contractual liability in respect of the owner of the

vehicle would depend upon the facts and circumstances

of each case, and there cannot be any straight jacket

formula, to hold that the claim is required to be tried in

the different forum.

9] In the present case, the driver of Tata Sumo has died

fa473.03.J.odt 11/12

because of his own negligence without involvement of any other vehicle.

He cannot therefore, said to be a third party whose risk is covered under

the statutory or an Act policy, I have gone through the policy in question,

which is comprehensive in nature and covers the liability of the paid

Driver/Workman No.1. I have already recorded the finding that the

Tribunal has committed an error in holding that the deceased was

employed as a driver on the vehicle in question by the respondent No.3.

There is no finding recorded by the Tribunal that the deceased was a

paid driver or workman The undisputed fact is that the deceased himself

was driving the vehicle in question. In such a situation, the deceased

steps into the shoes of the owner of the vehicle. The policy in question

does not cover the risk of the owner and of an unpaid driver. It covers

the risk of the paid driver only. The deceased was a friend of the son of

the owner and had borrowed the vehicle in question. In the facts and

circumstances of this case, the claim petition under Section 166, at the

instance of the dependents of the deceased against the Insurance

Company was not maintainable.

10] In view of the findings recorded on point Nos. [i], [ii] and

[iii], the point for determination at serial No. [iv] does not survive.

11] In the result, the appeal is allowed. The judgment and order

dated 27.03.2003 passed by the Motor Accident Claims Tribunal at

fa473.03.J.odt 12/12

Nagpur in Claim Petition No.575 of 2002 is quashed and set aside to the

extent it holds the Insurance Company liable to pay compensation jointly

and severally along with the owner of the vehicle. The claim petition is

dismissed against the Insurance Company only. Since the appeal is not

by the owner of the vehicle, the Award passed by the Tribunal against

the owner is not touched. If the appellant has deposited the amount, the

same shall be permitted to be withdrawn by the appellant along with

interest if any accrued thereon.

JUDGE NSN