Bajaj Allianz General Insurance ... vs Annasaheb Ramdas Shedale And ...
2016 Latest Caselaw 2090 Bom

                                             1                 F.A. NO.361 of 2015

                 
              IN THE HIGH COURT OF JUDICATURE OF BOMBAY




                                                                            
                         BENCH AT AURANGABAD




                                                    
                                   FIRST APPEAL NO.361 of 2015

               Bajaj allianz General Insurance co.Ltd.,
               Through it's Branch Manager / Authorized




                                                   
               Signatory, UnityPlaza, First Floor,
               Above At & T World, Mumbai Naka,
               Nashik.

               2nd Floor, Rajendra Chamber,




                                           
               Adalat Road, Aurangabad.
                              ig                 ...APPELLANT
                                                 (Orig.Resp.No.2)
                       VERSUS
                            
      1.       Annasaheb s/o Ramdas Shedale,
               Age 53 years, Occu. Agri.,
      

      2.       Sou.Heerabai w/o Annasaheb Shedale,
               Age 48 years, Occu: Household,
   



      3.       Sachin s/o Annasaheb Shedale,
               Age 25 years, Occu: Agri.

               All R/o. Fattayabad Tq.Shrirampur,





               Dist. Ahmednagar.

      4.       Bhanudas s/o Baban Labade,
               Age Major Occ: Business
               r/o. Fattyabad Tq. Shrirampur,





               Dist. Ahmednagar.
                                      ...RESPONDENTS
                        (Rspdt Nos. 1 to 3 -Org.Claimants)
                            Rspdt No.4 - Org.Rspdt No.1)

                        ...
      Shri Mohit Deshmukh, Adv., h/f Shri 
      S.G.Chapalgaonkar, Adv., for appellant.
      Shri S.D.Tanpure, Adv., for respondent nos. 1 to 
      3.




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                                              2                 F.A. NO.361 of 2015

      Shri N.C.Garud, Adv. for respondent no.4. 
                        ...




                                                                            
                                    CORAM: P.R.BORA, J.




                                                    
                             ***
      Date of reserving the judgment: 30/3/2016 
      Date of pronouncing judgment:                   2/5/2016




                                                   
                             ***
       
      JUDGMENT: 

1. By filing the present appeal, the

appellant Insurance Company (Original respondent

No.2) has questioned correctness and legality of

the judgment and order passed in M.A.C.P. No.338

of 2006 on 31st of August, 2014 by the Member,

Motor Accident Claims Tribunal, Shrirampur.

2. The present respondent nos. 1 to 3 had

filed the aforesaid claim petition claiming

compensation of Rs.6,00,000/- ( Rs. six lacs) on

account of death of one Sandip Annasaheb Shedale

who died in a motor accident happened on

10.6.2006 having involvement of an Ape Rickshaw

bearing registration No.MH-17-T-5495 owned by

respondent no.4 herein and isured with the

present appellant. Respondent nos. 1 and 2 are

3 F.A. NO.361 of 2015

the parents of deceased Sandip whereas respondent

no.3 is the brother of deceased Sandip.

Respondent nos. 1 to 3 are here-in-after referred

to as the original claimants.

3. It was the contention of the original

claimants before the Tribunal that the alleged

accident happened because of rash and negligent

driving of the driver of the offending Ape

Rickshaw through which deceased Sandip was

travelling at the relevant time. As stated in

the petition, deceased Sandip was aged about 23

years on the date of the accident and was earning

Rs.5,000/- per month out of his employment in one

Company at Chinchwad.

4. The claim petition was resisted by the

appellant Insurance Company. It was the

contention of the Insurance Company that on the

date of the accident, the owner of the offending

vehicle was not possessing any valid permit to

ply the said vehicle on the road. It was also

contended by the Insurance Company that the

4 F.A. NO.361 of 2015

driver of the offending Rickshaw was not holding

a valid and effective driving license on the date

of the accident. The Insurance Company has also

raised an objection for not impleading the driver

of the Ape Rickshaw as the respondent. The

income of the deceased was also disputed by the

Insurance Company. Learned Tribunal, however,

on the basis of the oral and documentary evidence

brought before him partly alowed the petition and

directed the owner and insurer of the offending

tempo i.e. original respondent nos. 1 and 2 to

pay the compensation of Rs.5,00,000/- ( Rs. five

lacs) inclusive of the amount of no fault

liability compensation to the claimant along with

the interest at the rate of 9 per cent per annum

from the date of institution of the petition till

its realization. Aggrieved by the said

judgment, the Insurance Company has filed the

present appeal.

5. Shri Mohit Deshmukh, learned Counsel

appearing on behalf of the petitioner, submitted

that though the Insurance Company had raised a

5 F.A. NO.361 of 2015

specific objection that the owner of the Ape

Rickshaw had committed breach of the policy

condition by plying the Ape Rickshaw without any

valid permit therefor, and has also proved the

said objection, the learned Tribunal has recorded

an erroneous and incorrect finding that there was

no breach of Insurance policy. The learned

Counsel further submitted that the Tribunal has

erroneously observed that the permit can be got

renewed by paying the penalties in the R.T.O.

Office and, consequently, has reached to the

erroneous conclusion that there was no breach of

the policy condition. Learned Counsel further

submitted that the Tribunal has failed in

properly appreciating the law laid down in the

judgment relied upon by the appellant Insurance

Company. Learned Counsel submitted that the

Tribunal has wrongly held that the law laid down

in National Insurance Company Ltd. vs. Challa

Bharathamma and others ( 2004 ACJ 2094) favours

the case of the claimants and not the

respondents. Learned Counsel further submitted

that the Tribunal has grossly erred in

6 F.A. NO.361 of 2015

determining the amount of compensation. It was

argued that since the deceased was a bachelor,

one half of his income must have been held to be

his personal expenses and the dependency of the

parents ought to have been decided on the basis

of half of his balance income whereas the

Tribunal has deducted only one third of the icome

of the deceased towards his personal expenses and

has accordingly assessed the compensation.

Learned Counsel submitted that in view of the

fact that the Insurance Company has duly proved

that the owner of the offending Ape Rickshaw has

committed breach of the policy condition, the

learned Tribunal ought to have dismissed the

claim against the Insurance Company. Learned

Counsel, therefore, prayed for allowing the

present appeal and to set aside the impugned

judgment and award passed against the appellant

Insurance Company.

6. Learned Counsel appearing for the

claimants has supported the impugned judgment and

award. Learned Counsel Mr. N.C.Garud, appearing

7 F.A. NO.361 of 2015

for respondent no.4 opposed the submissions

advanced on behalf of the appellant Insurance

Company. Learned Counsel submitted that it was

not the case that the offending Ape Rickshaw was

never holding any permit. It was further

contended by him that the Ape Rickshaw was having

a valid permit till 17.4.2006 but it was not

renewed till the date of the accident. Learned

Counsel submitted that in the case of Challa

Bharathamma and others (cited supra), relied

upon by the appellant Insurance Company, there

was no permit at all and, as such, the decision

in the said case cannot be applied to the facts

of the present case. Referring to the

provisions of Section 81 of the Motor Vehicles

Act, the learned Counsel submitted that the delay

in making the renewal application can also be

condoned by the authorities and where the permit

gets renewed after expiry of the period thereof,

such renewal shall take the effect from the date

of such expiry. Learned Counsel submitted that

in view of such provision, the Tribunal has

correctly rejected the objection of the appellant

8 F.A. NO.361 of 2015

Insurance Company that there was a breach of

policy condition. Learned Counsel, therefore,

prayed for dismissal of the appeal.

7. I have carefully considered the

submissions advanced by the learned Counsel

appearing for the respective parties. I have

also perused the impugned judgment and record of

the case.

8. The Insurance Company, in its written

statement filed before the Tribunal had raised a

specific objection that the APE Rickshaw involved

in the alleged accident was not holding a valid

permit to ply the same on the road on the date of

the accident i.e. 10th of June, 2006. On that

count, the Insurance Company had denied its

liability to indemnify the insured. According

to the Insurance Company, it was a breach of

policy condition.

9. In view of the plea raised by the

Insurance Company in its written statement, the

9 F.A. NO.361 of 2015

learned Tribunal had also framed an issue whether

there was any breach of Insurance policy. The

Tribunal has, however, recorded a negative

finding on the said issue. In paragraph no.22 of

the impugned judgment, the Tribunal has referred

to the document at Exh.36 which is permit of the

offending APE Rickshaw. The Tribunal has

observed that the permit of the APE Rickshaw, to

ply it on road, was expired on 17.4.2006. The

Tribunal has, however, not recorded any specific

finding whether not holding of the valid permit

for the offending Rickshaw on the date of the

accident would amount to breach of terms and

conditions of the Insurance policy and whether,

for that reason, the Insurance Company was liable

to be exonerated from its liability to indemnify

the insured.

10. Though against the issue No.3 framed as

'Whether there is any breach of Insurance

policy ?', the Tribunal has recorded a negative

finding, there is little discussion on what

ground it had arrived at the conclusion that

10 F.A. NO.361 of 2015

there was no breach of policy condition. From

the discussion made by the learned Tribunal in

paragraph no.24 of the impugned judgment, it can

be gathered that the Tribunal was of the view

that when the Insurance policy was in force and

the driver of the offending APE Rickshaw was

holding valid driving license to ply the same,

the breach of policy condition cannot be said to

be committed by the insured merely on the ground

that the permit of the APE Rickshaw was not

renewed. The Tribunal has further observed

that the permit can be got renewed by paying the

penalties in the R.T.O. Office.

11. The observations made as above and

the conclusion arrived at by the learned

Tribunal are apparently erroneous and against

the law laid down by the Honourable Apex Court in

the case of National Insurance Ltd. Vs. Challa

Bharathamma and others (cited supra). The

aforesaid judgment was heavily relied upon by

the Insurance Company. From the discussion

made by the Tribunal, it appears that the

11 F.A. NO.361 of 2015

Tribunal has failed in appreciating the import of

the said judgment and the ratio laid down in the

said judgment. The Honourable Apex Court in

the aforesaid judgment has categorically held

that, "plying of a vehicle without a valid permit

amounts to infraction of law". The Honourable

Apex Court has further held that under Section

149 (2) of the Motor Vehicles Act, the defense

that the insured plied the vehicle without valid

permit and thereby committed breach of policy

condition is well available for the Insurance

Company to deny its liability to indemnify the

insured. The Honourable Apex Court has further

observed that the Insurance policy being

operative during the relevant period, had no

relevance in deciding the issue regarding the

liability.

12. In view of the law laid down as above,

it was not open for the learned Tribunal to

record a contrary finding.

13. In the impugned judgment, the learned

Tribunal has discussed the following judgments:

                                       12               F.A. NO.361 of 2015

               1)      2004 ACJ 2094 SC
                       (National Insurance Co. Ltd 




                                                                    
                            vs 
                       Chella Bharathamma & Ors)




                                            
               2)      2013 ACJ 935 BOMBAY
                       (Oriental Insurance Co. Ltd. 
                            V 




                                           
                       Suhas & Ors)

               3)      2009 (1) AIR Bombay R-43 (SC)
                       (National Insurance Co.Ltd.
                            versus




                                   

Vidhyadhar Mahariwala & others)

I am constrained to observe that the Tribunal has

utterly failed in understanding and appreciating

the ratio laid down in all the aforesaid

judgments. In the case of Challa Bharathamma

and others (cited supra), as I have mentioned

here-in-before, the Honourable Apex Court has

categorically held that plying of a vehicle

without a valid permit amounts to infraction of

law. In the said matter, a specific issue was

raised before the Honourable Apex Court whether

the Insurance Company would be liable if the

insured had not obtained the permit to ply the

vehicle and the Honourable Apex Court has

answered the said issue in negative. The fact

apart that the Honourable Apex Court has further

13 F.A. NO.361 of 2015

directed the Insurance Company to deposit the

amount at the first instance and recover the same

from the insured by initiating proceedings before

the executing Court without filing any separate

suit therefor. In no case it can be said that

the observations made and the conclusion recorded

by the Honourable Apex Court in the aforesaid

case are against the plea taken by the Insurance

company. The observations made in this regard in

para 27 of the impugned judgment are wholly

incorrect and unsustainable.

14. In the case of Oriental Insurance

Company Vs. Suhas (cited supra), this Court has

affirmed the finding recorded by the Tribunal

that there was breach of policy condition as the

Driver of the offending vehicle was not holding a

valid license. This Court has further held that

the Tribunal was justified in directing the

Insurance Company to pay compensation and then

recover the said amount from the owner of the

offending vehicle. It is evident that the

aforesaid judgment also cannot be said to be in

14 F.A. NO.361 of 2015

any way dis-favouring the case of the Insurance

Company.

15. In National Insurance Company Vs.

Vidyadhar, cited supra, the Honourable Apex Court

has held that the Insurance Company was

exonerated from its liability to indemnify the

insured as the driving license of the driver of

the offending vehicle was not in force on the

date of the accident. It is surprising that

inspite of the aforesaid three judgments on

record, the learned Tribunal has recorded a

negative finding on the issue whether there is

any breach of insurance policy. In view of the

law laid down in all the aforesaid judgments

discussed hereinabove, the finding as recorded by

the learned Tribunal on the issue of breach of

policy condition cannot be sustained and is

liable to be set aside.

16. It is interesting to note that in

paragraph no.29 of the impugned judgment, the

Tribunal has observed that, "from the

observations made in the aforesaid rulings, it

15 F.A. NO.361 of 2015

appears to me that the insurer can pay the award

amount to the petitioner at first instance and

later on it can be recovered from the insured in

the same proceeding". From the observations

made as above, it is quite clear that the

Tribunal was convinced that in view of the law

laid down in the above referred judgments cited

before it, no liability could have been saddled

on the insurance company and it was liable to be

exonerated from its liability to indemnify the

insured and the only order which at the most

could have been passed was to direct the

Insurance Company to first pay the amount of

compensation to the claimants and then recover

the same from the insured. While passing the

order, the Tribunal has, however, held the

Insurance Company also liable to pay the amount

of compensation along with the insured and has

not passed any further order that the insurance

company will be entitled to recover the amount of

compensation paid by it to the claimants from the

insured.

16 F.A. NO.361 of 2015

17. In the above circumstances, the finding

recorded by the Tribunal that no breach of policy

condition has been committed by the owner of the

vehicle, is set aside and it is held that the

insurance company has sufficiently proved that

the insured has committed breach of policy

condition by plying the APE Rickshaw on road

without having any valid permit therefor on the

date of the accident. Consequently, the insurance

company is exonerated from its liability.

Nevertheless, considering the beneficial object

of the Act, as was directed by the Honourable

Apex Court, in the case of Challa Bharathamma and

others (cited supra), it would be proper for the

Insurance Company to satisfy the award, though in

law it has no liability, and then recover the

amount paid by it from the insured in the

proceeding before the Tribunal itself and it

shall not be required to file any separate suit /

proceeding for recovery of the said amount.

18. In so far as the other objection raised

by the appellant insurance Company in respect of

17 F.A. NO.361 of 2015

the quantum of compensation on the ground that

the deceased being bachelor, while assessing the

amount of dependency compensation, it should have

been assessed on one half of the income of the

deceased, is concerned, I am not inclined to

cause any interference for the reason that while

determining the amount of compensation, the

income of the deceased is held only to the tune

of Rs.3,000/- per month.

19. The appeal thus stands allowed in

aforesaid terms. Civil applications, if any,

stand disposed of.

(P.R.BORA)

JUDGE

...

AGP/361-15fa