The Oriental Insurance Col Ltd , ... vs Savita Kailas Kokate And 5 Ors
2017 Latest Caselaw 3309 Bom

1906 FA 574/2006                              1                        Judgment


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


                        FIRST APPEAL NO. 574/2006 

The Oriental Insurance Co. Ltd.,
Divisional Office, Rayat Haweli,
Old Cotton Market, Akola, through
The Divisional Manager,
The Oriental Insurance Co. Ltd.,
Kanoria House, Palm Road,
Civil Lines, Nagpur.                                    APPELLANT


                                .....VERSUS.....


1]     Smt. Savita wd/o Kailas Kokate,
       Aged 30 years, Occu: Household,

2]     Ku. Priya d/o Kailas Kokate,
       Aged 10 years, Occu: Education,

3]     Manoj @ Vaibhav s/o Kailas Kokate,
       Aged 9 years, Occu: Education,

4]     Kum. Ritu d/o Kailas Kokate,
       Aged 5 years.

       Resp. Nos.2 to 4 being minors,
       through their natural guardian mother,
       respondent no.1.

5]     Shri Vishwanath Pandhari Kokate (deleted)

6]     Smt. Kamini w/o Vishwanath Kokate,
       Aged 53 years, Occu: Household,

       All R/o. Babhulgaon, Tah. Telhara,
       Distt. Akola.


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7]     Shri Ashok Sakharam Pargharmor,
       Age : Adult, Occu: Agriculturist,

8]     Shri Samadhan Dnyandeo Pande,
       Age : Adult, Occu: Agriculturist,

       Both R/o. Talegaon Babhulgaon,
       Tah. Telhara, Distt. Akola.                        RESPONDE
                                                                  NTS
                                                                     


       Shri Ashish W. Paunikar, counsel for the appellant.
       Shri A.B. Mirza, counsel for respondent nos.1 to 6.


                    CORAM : DR. SMT. SHALINI PHANSALKAR-JOSHI, J.

                 DATE     : JUNE 19, 2017.



ORAL JUDGMENT :  

The issue raised for consideration in this appeal is

whether the claimants, who are the legal heirs of the deceased and

who have filed the application for compensation under Section 166

of the Motor Vehicles Act (hereinafter will be referred to as "Act" for

convenience) and having availed an interim benefit under Section

140 of the Act, are entitled to compensation finally under Section

163(A) of the Act, that too by the Tribunal suo moto converting the

application filed under Section 166 to Section 163(A) of the Act.

 1906 FA 574/2006                                 3                          Judgment


2]              For deciding this legal issue, the factual matrix of the 

appeal, which is necessary to know, can be stated as follows :-

Deceased Kailas was the husband of respondent no.1,

father of respondent nos.2 to 4 and son of respondent no.5. On

09/12/2003, he was proceeding as pillion rider on motorcycle,

bearing no. MH-30-D-7740, driven by respondent no.7 and owned

by respondent no.8. The said motorcycle was insured with the

appellant. One white colour Jeep coming from opposite direction,

driven in high speed and in rash and negligent manner, gave dash to

his motorcycle, thereby causing the accidental death of Kailas. The

said Jeep fled away from the spot after the accident and could not

be traced. F.I.R. came to be registered against the driver of the said

unidentified white colour Jeep. Even police could not trace the said

Jeep in the course of investigation.

3] At the time of accident, deceased Kailas was running

the age of 30 years and on account of his untimely death, as

respondents lost their only source of income, they preferred the

Claim Petition No. 77/2005 before the Motor Accident Claims

Tribunal, Akot, claiming the compensation from appellant and

1906 FA 574/2006 4 Judgment

respondent nos.7 and 8 contending inter alia that respndent nos.1 to

5 have lost their only source of income and emotional support.

Hence considering the age of deceased and the income, which he

was earning from agriculture to the tune of Rs.120/- per day, they

were entitled to get compensation of Rs.4,00,000/-.

4] This claim petition came to be resisted by respondent

nos.7 and 8 and also by appellant, submitting that the sole cause of

the accident was rash and negligent driving of the Jeep and hence

they were not liable to pay any amount of compensation to the

claimants.

5] As regards the appellant, it was further contended that

though the motorcycle on which the deceased was riding as pillion

seater was insured with appellant, however, it was not insured

under a comprehensive policy but under an Act only policy,

therefore, liability of the pillion rider being not covered thereunder,

as the extra premium was not paid by the owner of the motorcycle,

the claim against the insurance company was not tenable. Hence,

appellant-insurance company needs to be absolved, from joint and

1906 FA 574/2006 5 Judgment

several liability to pay compensation to the claimants.

6] In view of the rival pleadings of the parties, the

Tribunal framed necessary issues at Exh.29. In support of her claim,

the respondent no.1, the claimant examined herself and produced

on record the relevant documentary evidence, like, the copy of F.I.R.

(Exh.31), spot panchmama (Exh.32) and post mortem notes

(Exh.34).

7] On appreciation of the evidence led on record, the

Tribunal was pleased to hold that the cause of the accident was

clearly proved to be the rash and negligent driving of the

unidentified Jeep. As the driver, owner and insurance company of

the said Jeep could not be traced, they were not added as

respondents in the petition, though it was necessary for the

claimants to do so. Hence, the Tribunal then on it's own, suo motu

converted the claim petition from Section 166 to Section 163-A of

the Act, and awarded compensation amount to the tune of

Rs.1,64,000/- to be paid by appellant and respondent nos.7 and 8 to

the claimants jointly and severally.

 1906 FA 574/2006                                  6                          Judgment




8]              Perusal   of   the   impugned   judgment   and   order   of   the 

Tribunal reveals that the contention raised by learned counsel for

appellant herein that as the policy was Act only policy, the insurance

company will not be liable to pay the compensation for death of a

pillion rider on the motorcycle, was rejected by the Tribunal relying

upon the judgment of this Court in Ajay -Vs- Avinash, 2004 (2)

Mh.L.J. 725, wherein it was held as follows :-

"In Section 147 of the M.V. Act, 1988, there is no limit in certain cases as contained in Clause (ii) of the old Act. The corresponding provisions in the old Act contain 3 clauses whereas now there are only two clauses. What was dropped in the new Act is the Clause which excluded the coverage for death or bodily injury to person carryied in or upon the vehicle. That means such a liability cannot be now excluded from the policy. Therefore when the policy of insurance is an "Act Policy" the insurance company will not stand absolved from the liability in respect of the pillion rider of the motorcycle. The petitioner pillion rider who fell down from the motorcycle and sustained injury would not thereore, be denied the compensation u/s 140 by the Insurance Company. The order of the Motor Accident Claims Tribunal in so far it rejects the claim against the Insurance Company is hence set aside. The Insurance Company is liable to pay the amount of interim award u/s 140 of the M.V. Act, 1988 with interest @ 9% p.a. till the date of realisation."

9] Relying upon the ratio laid down in the abovesaid

1906 FA 574/2006 7 Judgment

ruling, it was held by the Tribunal that appellant-insurance company

will not stand absolved from the liability in respect of the pillion

rider of the motorcycle. It was further held that as the claim now

needs to be converted to Section 163(A) of the Act, non-joinder of

the owner, driver and insurance company of the Jeep would not

cause any impediment in claiming the compensation.

10] This judgment of the Tribunal is rightly challenged in

this appeal by learned counsel for appellant in view of the legal

position, which is crystalized in various judgments of the Hon'ble

Supreme Court to the effect that in case of Act policy, the liability of

the insurance company stands absolved in case of the death of the

pillion rider, who is not a third party. Moreover the law is also clear

to the effect that claimants in such cases, at the most can be entitled

to compensation under Section 140 of the Act for no fault liability

but neither under Section 166 or Section 163 which deal with fault

liability. In the judgment of this court also, on which Tribunal has

placed reliance, the claimants were held entitled for compensation

from insurance company only to the extent of "no fault liability"

under Section 140 of the Act. The insurance company was

1906 FA 574/2006 8 Judgment

accordingly held liable to pay the amount of interim award under

Section 140 of the Act. However, if the claimants have already

availed the benefit entitled under Section 140 of the Act as in the

present case, by filing petition under Section 166 of the Act, such

petition cannot be converted to Section 163-A of the Act as the

liability under Section 163-A of the Act is also fault liability.

11] In this case, it is an admitted factual position that

deceased Kailas was pillion rider. Not only claimant no.1 admitted

this fact, but even respondent no.7, the owner and respondent no.8,

the driver have also admitted the fact that deceased Kailas was

pillion rider at the time of accident of the motorcycle. The copy of

the F.I.R. (Exh.31) filed in the case is also more than sufficient to

further confirm that deceased Kailas was sitting as pillion rider on

the said motorcycle at the time of accident. In such situation, when

the policy is Act policy and not a comprehensive policy, then the

liability of insurance company, either under Section 166 or under

Section 163-A of the Act stands absolved as regards the death of

pillion rider, in view of the legal position discussed in the case of

Oriental Insurance Co.Ltd. - Vs-

Sudhakaran K.V., 2008 ACJ

1906 FA 574/2006 9 Judgment

2045(SC). In this case the Two Judge Bench of the Hon'ble Apex

Court, while dealing with the issue whether a pillion rider on a

scooter would be a "third party" within the meaning of Section 147

of the Act, after referring to number of its earlier decisions, held in

para no.16 as follows :-

"(16) The contract of insurance did not cover the owner of the vehicle, certainly not the pillion rider. The deceased was travelling as a passenger, stricto sensu may not be as a gratuitious passenger as in a given case she may not be a member of the family, a friend or other relative. In the sense of the term which is used in common parlance, she might not be even a passenger. In view of the terms of the contract of insurance, however she would not be covered thereby."

In para no.19, it was held that, "The law which emerges

is that the liability of the insurance company in a case of this nature is

not extended to a pillion rider of the motorcycle unless the requisite

amount of premium is paid for covering his/her risk". It was further

held that,

"The legal obligation arising under Section 147 of the Act cannot be extended to an injury or death of the owner of the vehicle or the pillion rider, and the pillion rider in a two wheeler was not to be treated as a third party when

1906 FA 574/2006 10 Judgment

the accident has taken place owing to rash and negligent riding of scooter and not on the part of driver of another vehicle".

12] The same legal position was reiterated in subsequent

decision of National Insurance Co. Ltd. -Vs- Balkrishnan and

another, 2013 ACJ 199 (SC). Here in the case, having regard to the

admitted factual position that deceased was the pillion rider, his

liability cannot stand covered under the Act policy, either under

Section 163-A or under Section 166 of the Act which deal with fault

liability. His liability would have been covered by the insurance

policy of the offending vehicle, the Jeep, as the accident has

occurred due to rash and negligent driving of the Jeep driver.

However as the Jeep or its driver or owner were not identified,

claimants could not join them or their insurer. Though it is an

unfortunate fact, the insurance company of the motorcycle on which

deceased was proceeding as a pillion rider, cannot be held liable to

compensate his legal heirs, when it was only Act policy and

deceased was not a "third party".

13]             The next question arising for consideration is whether 





 1906 FA 574/2006                                11                         Judgment

Tribunal could have converted this petition filed by the claimants

under Section 166 to Section 163-A of the Act? In this respect also,

the legal position is fairly well settled by the decision of the Hon'ble

Apex Court in the case of Deepal Girishbhai Soni and others -Vs-

United India Insurance Co. Ltd., 2004 ACJ 934, wherein it was

held by the Hon'ble Apex Court that "Once amount of compensation

is received for No Fault Liability by filing the petition under Section

166 of the Act, application under Section 163-A of the Act, cannot be

maintainable".

14] In the decision of our own High Court also, in the case

of New India Insurance Co. Ltd. -Vs- Geeta Sadanand Naik and

others, 2013 ACJ 1082, the same legal position was reiterated. The

facts of the said case were identical to the facts of the present case.

In that case also, the claimants had filed an application under

Sections 166 and 140 of the Act. They also received the amount for

No Fault Liability under Section 140 of the Act. Subsequently they

sought conversion of their claim from the one under Section 166 of

the Act to that under Section 163-A of the Act. Tribunal allowed the

same and awarded the compensation under Section 163-A of the

1906 FA 574/2006 12 Judgment

Act, directing adjustment of the amount received by the claimants

under Section 140 of the Act. In the light of these facts, it was held

that Section 163-B of the Act specifically clarifies that claim

application can be filed either under Section 140 or under Section

163-A of the Act but not under both. It was further held that "There

was no provision under the Act for reducing the amount awarded

under Section 140 of the Act from the amount finally awarded under

Section 163-A of the Act". While further clarifying the distinction

between these two provisions of Section 163-A and Section 140 of

the Act, the Hon'ble Apex Court was pleased to hold in para nos.26

and 27 of its judgment as follows :-

"26. Section 163-B of the Act provides for an option to file claim in certain cases and it says that where a person is entitled to claim compensation under sections 140 and 163-A, he shall file claim under either of the said sections and not under both. The above is a mandatory section. Hence, if a person has filed an application for compensation under section 140 of the Act and has already received the said compensation, then, certainly he cannot maintain the claim petition under section 163-A of the Act. In the case of United India Insurance Co. Ltd.

-Vs- Janabai, 2003 ACJ 350 (Bombay), the learned single Judge of the Aurangabad Bench of our High Court has held that the wording of section 163-B of the Act is very clear and a person cannot claim compensation under sections 140 and 163-A. It has been held that a choice has been given to person to claim compensation under

1906 FA 574/2006 13 Judgment

either of sections and not both. It has been held that where the Tribunal has awarded compensation under section 140 as well as under section 163-A, award under section 163-A is contrary to statutory provision and, therefore, the award cannot be sustained in law. I fully agree with the above view of the learned single Judge of the Aurangabad Bench of our High Court."

"27. Section 141(1) of the Act crystalises that right to claim compensation under section 140 is in addition to any other right to claim compensation on the principle of fault liability and specifically excludes the right to claim compensation under the scheme referred to in section 163-A. Sub-section (2) of section 141 further provides that if the claimant has filed an application for compensation under section 140 and also in pursuance of any right on the principle of fault liability, the claim for compensation under section 140 is to be disposed of in the first instance and as provided in sub-section (3), the amount received under sub-section (2) of section 140 is to be adjusted while paying the compensation on the principle of fault liability. However, there is no provision in the Act for reducing the amount awarded under section 140 from the amount finally awarded under section 163- A of the Act. On the contrary, section 163-B specifically clarifies that claim petition can be filed either under section 140 or under section 163-A but not under both sections."

Ultimately in para no.28 of the judgment, it was held

that "The finding of learned Claims Tribunal to the effect that the

claimants are entitled to compensation finally under Section 163-A of

the Act after having availed of interim benefit under Section 140 of the

Act is erroneous and cannot be sustained".

 1906 FA 574/2006                                 14                         Judgment




15]             In this case, admittedly as observed by the Tribunal in 

its judgment in para no.16, the claimants were already paid No Fault

Liability amount of Rs.50,000/- under Section 140 of the Act. In

such circumstances, in the light of the law laid down by the Hon'ble

Apex Court and in the abovesaid authorities of this High Court, the

claimants cannot be entitled to get amount under Section 163-A of

the Act. In this respect, the Tribunal has committed an error in suo

motu converting the petition of the claimants from Section 166 of

the Act to Section 163-A of the Act, that too, after the claimants

have availed compensation for no fault liability under Section 140 of

the Act. Appellant insurance company, in above such circumstances,

is, therefore, entitled to get absolved from the liability to pay

compensation to the claimants under Section 163-A of the Act. So

far as the liability of respondent nos.7 and 8, the driver and owner

of the vehicle, is concerned, as they have not approached this Court

in order to challenge the award passed against them, this Court

need not enter into the aspect of their liability.

16]             Appeal, therefore, needs to be allowed for setting aside 





 1906 FA 574/2006                              15                         Judgment

the impugned judgment and award as against the appellant.

17] The impugned judgment and award passed by the

Tribunal is thus set aside against the appellant.

18] Appellant is absolved from the joint and several liability

of paying compensation to the respondents/ claimants.

19] As amount of compensation is already deposited by

appellant in the court, appellant is permitted to withdraw the said

amount with interest accrued thereon, if not already withdrawn by

the claimants, and if it is already withdrawn by the

respondents/claimants, then appellant is entitled and is at liberty to

take necessary steps for recovery of the said amount.

20] Appeal stands disposed of in above terms with no order

as to costs.

JUDGE

Yenurkar