Smt. Asha Wd/O Pandurang Raut And ... vs Mohd. Majid Mohd. Afsar And Others
2021 Latest Caselaw 11404 Bom

  8FA 963.2018.odt                            1



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

                         FIRST APPEAL NO. 963 OF 2018

  1. Smt. Asha wd/o Pandurang Raut,
     aged about 56 years, Occ. Household.

  2. Swapnil s/o Pandurang Raut,
     aged about 28 years, Occ. Education.

  3. Pratik s/o Pandurang Raut,
     aged about 26 years, Occ. Education.

       All are R/o Behind Circuit House,
       Yavatmal, Tq. & Dist. Yavatmal.
                                                            ...APPELLANTS
                    Versus

  1. Mohd. Majid Mohd. Afsar,
     aged about 40 years, Occ. Driver,
     R/o Ner, Tq. Ner, Dist. Yavatmal,
     (Driver cum owner of Bajaj Tempo
     Trax No. MH-29/C-0539 at the date
     and time of accident).

  2. The Oriental Insurance Co. Ltd.,
     Through its Branch Manager,
     Office Vir Wamanrao Chowk, Yavatmal,
     Tq. & Dist. Yavatmal.

  3. Smt. Rukmini wd/o Laxman Raut,
     aged about 76 years, Occ. Nil,
     R/o C/o Anil Bagde, Flat No. 202,
     Vaishnavi Apartment, Naik Nagar,
     near Ulhas Nagar, Manewada Ring Road,
     Nagpur - 440027.
                                                        ...RESPONDENTS

  Shri J.A. Malnas, Advocate for the appellants.
  Shri A.J. Mirza, Advocate for respondent No.1.
  Shri Lalit Limaye, Advocate for respondent No.2.
  Shri K.R. Lule, Advocate for respondent No.3.
                     .....


::: Uploaded on - 21/09/2021                 ::: Downloaded on - 08/10/2021 08:24:46 :::
   8FA 963.2018.odt                               2



                                    CORAM : PUSHPA V. GANEDIWALA, J.

DATED : AUGUST 20, 2021.

ORAL JUDGMENT :

The appellants/ claimants take exception to the

judgment and award dated 31/03/2016 passed by the

Chairman, Motor Accident Claims Tribunal, Yavatmal in

M.A.C.P. No. 62/2010 (New No. 11/2016), whereby the

Tribunal partly allowed the claim of the appellants/ claimants

and directed respondent No.1, i.e., the owner-cum-driver of the

offending vehicle to pay Rs.19,23,000/- to the appellants/

claimants towards compensation along with interest @ 7% per

annum from the date of application. The Tribunal completely

exonerated the Insurance Company from payment of

compensation on account of breach of conditions in the policy

by the owner of the vehicle.

The facts, necessary to decide the present Appeal,

may be stated as under :

2. On 16/04/2010, while the deceased Pandurang

was going on a motorbike bearing No. MH-29/P-6238, at

around 5:15 pm towards Futka Matha, Kolura Shivar on Ner to

Yavatmal road, one Bajaj Tempo Trax bearing No. MH-29/C-

0539, which was driven by respondent No.1, came from the

opposite direction in a rash and negligent manner and gave

dash to the motorbike of the deceased by coming from the

wrong side of the road, as a result of which the deceased fell

down on the spot and sustained fatal injuries over vital organs

of his body, and he died while on the way to the hospital at

Sawangi Meghe, District Wardha.

3. It is stated that the First Information Report was

registered against respondent No.1 at the Police Station Ner,

Taluka Ner, District Yavatmal. It is further stated that the said

Tempo Trax was duly insured with respondent No.2 -

Insurance Company. The appellants/ claimants filed Claim

Petition under Section 166 of the Motor Vehicles Act, 1988

("MV Act") before the Member, Motor Accident Claims

Tribunal, Darwha, and claimed compensation of

Rs.70,60,000/-, which was later on transferred to the Court of

the Motor Accident Claims Tribunal, Yavatmal. It is stated that

the age of the deceased, at the relevant time, was around 52

years. The deceased was the State Government employee and

was serving as a Librarian in the Government Polytechnic

College, Yavatmal. That he was earning Rs.45,000/- per month.

The deceased was the husband of appellant No.1, father of

appellant Nos.2 and 3 and son of respondent No.3.

4. Respondent No.1 - owner-cum-driver of the

offending vehicle, in his written statement, has admitted that

he was the owner-cum-driver of the offending vehicle (Bajaj

Tempo Trax bearing No. MH-29/C-0539) on the date of

accident, which was duly insured with respondent No.2 -

Oriental Insurance Company Limited, and that the said policy

was valid and was in force at the relevant time and the

insurance policy covers the risk of the deceased, he being a

third party. He was having driving license on the date of

accident, and therefore, there was no breach of terms and

conditions of the insurance policy.

5. Respondent No.2 - Insurance Company, in its reply,

while denying the occurrence of the accident, resisted the claim

petition in toto, took statutory defence as are available to it

under Section 149(2) of the MV Act.

6. The Tribunal framed necessary issues and recorded

evidence as adduced by the parties. Appellant No.2 - the son of

the deceased, has examined himself at Exh.35, one eye witness

Pramod Rathod, who was travelling in the offending vehicle at

the relevant time at Exh.50, one Vijay Nande - an employee of

the Government Polytechnic College, Yavatmal on the point of

salary and other benefits of the deceased at Exh.51, one

Shankar Bhagadkar - the ambulance driver, who carried the

injured deceased to the hospital at Exh.61. To substantiate their

claim for compensation, the appellants/ claimants have

brought on record the following documents :

• First Information Report • Spot Panchanama • Form AA • Inquest Panchanama

• Postmortem report • Insurance Policy • Extract registration of the offending vehicle • Driving license of respondent No.1

Neither the owner nor the insurer of the offending

vehicle preferred to examine any witness to substantiate their

stand.

7. The Tribunal, on appreciating evidence, exonerated

the Insurance Company on the ground that there were breach

of terms and conditions in the policy by the owner of the

offending vehicle. The Tribunal observed that the private

vehicle was being used for commercial purpose by the owner of

the vehicle and that he himself was driving the vehicle. The

Tribunal relied on the testimony of the witness Pramod Rathod,

who deposed that he had paid Rs.18/- towards fare to

respondent No.1 as a paid passenger in the vehicle. The

Tribunal fastened the entire liability of payment of

compensation on respondent No.1 - owner-cum-driver of the

offending vehicle. This judgment is impugned in this Appeal by

the claimants.

8. Shri Malnas, learned counsel for the appellants/

claimants, in all his fairness, restricted his argument only with

regard to the fixing of liability of payment of compensation on

respondent No.2 - Insurance Company along with respondent

No.1 - the owner of the offending vehicle. He further relied on

a series of judgments delivered by the Hon'ble Supreme Court

so also by this Court, particularly on the decision of the Hon'ble

Supreme Court in the case of National Insurance Co. Ltd. Vs.

Swaran Singh And Others, (2004) 3 SCC 297, and submitted

that the Tribunal has committed gross error in not appreciating

the material on record in its proper perspective. He submitted

that respondent No.2 - Insurance Company has failed to prove

that there was any fundamental breach of policy conditions

and thus, he urged to direct respondent No.2 - Insurance

Company to pay the compensation to the legal representatives

of the deceased, considering the valid and effective policy of

the offending vehicle at the relevant time.

9. Shri Limaye, learned counsel for respondent No.2,

while supporting the impugned judgment and award,

submitted that the vehicle was used by the owner for

commercial purposes, and the said fact has been established

from the evidence of claimants' witness No.2, who was

travelling in the offending vehicle at the relevant time, and

therefore, the Insurance Company could establish that the

owner of the vehicle has committed fundamental breach of

policy conditions. The learned counsel urged to dismiss the

Appeal.

10. While the learned counsel Shri Mirza, appearing for

respondent No.1 - the owner of the vehicle, supported the

stand of the claimants.

11. I have considered the submissions advanced on

behalf of both the sides, and perused the record.

12. At the outset, there is no dispute with regard to

valid and effective driving license of respondent No.1 - owner-

cum-driver of the offending vehicle at the relevant time.

Similarly, there is no dispute with regard to the existence of

valid third party insurance policy for the offending vehicle. The

documents of the policy is placed on record at Exh.70. The

victim of the accident, i.e., the deceased was admittedly the

third party qua respondent Nos.1 and 2.

13. The Tribunal has rightly adjudicated the

compensation on the basis of evidence with regard to salary of

the deceased, who was working as a Librarian in the

Government Polytechnic College, Yavatmal. During argument,

Shri Malnas, learned counsel for the appellants, submitted that

the appellants are getting family pension due to death of the

deceased in the motor vehicular accident. Therefore, the only

point for consideration of this Court is whether respondent

No.2 - Insurance Company can be directed to pay the amount

of compensation to the appellants/ claimants?

14. It is also not in dispute that the owner of the

offending vehicle was driving the said vehicle at the time of the

accident. The defence of the Insurance Company is with regard

to the breach of policy conditions, and the same has been

accepted by the Tribunal, being breach of policy conditions.

The Tribunal has failed to keep in mind the object and purpose

of the statute. The main purpose, recognized under the statute,

is that no third party should suffer despite breach of any

condition in the insurance policy between insurer and insured.

Though such a breach of condition is proved by the insurer

against the insured, it should be treated as an inter-se dispute

between the insurer and the insured and the same should not

affect the right of a third party, unless, there is a contribution

by the third party himself in causing the breach of any

condition of the policy. The Court has to examine whether the

said breach is referable to the cause of accident in which case it

would become a fundamental breach. I take support for this

view from the case of New India Assurance Co. Ltd. Vs.

Yallavva and Ors., 2020 ACJ 2560.

15. In the instant case, respondent No.2 - Insurance

Company has failed to examine any witness to substantiate its

stand. The Tribunal exonerated the Insurance Company only

on the basis of the admission given by the claimants' witness

No.2 that he was travelling as a paid passenger and he paid

Rs.18/- towards fare. The Insurance Company could not prove

that respondent No.1 - owner of the offending vehicle was

using the said vehicle for commercial purposes as his regular

source of income. Moreover, the record is absolutely silent on

the point that the cause for accident is only because respondent

No.1 - owner had allowed the paid passengers in his private

vehicle. In these facts situation, it cannot be held that the

owner of the offending vehicle has committed any fundamental

breach of policy conditions so as to exonerate the insurer of the

offending vehicle from payment of compensation. It is the

statutory liability of the Insurance Company to pay

compensation to the third party even there is a breach of the

policy conditions by the owner of the vehicle. The Tribunal has

failed to consider this aspect of the matter.

16. At this juncture, it would be relevant to refer to the

case of United India Insurance Co. Ltd. Vs. Lehru And Others,

(2003) 3 SCC 338, wherein the Hon'ble Supreme Court has

held that where a breach of policy conditions is not willful and

where it is proved by the insurer that there is a willful breach

of the terms of policy, the insurer would still be liable to pay

the third party and recover the amount.

17. The co-ordinate Bench of this Court in the case of

Rambhau Awadut Gawai & ors. Vs. Shivlal Shalikram Belsare &

anr., 2020(5) Bom.C.R. 242, while relying on the judgment of

the Hon'ble Supreme Court in the case of S. Iyyapan Vs. United

India Insurance Company Limited And Another, (2013) 7 SCC

62, has held that it is the statutory duty of the Insurance

Company to pay the amount of compensation to the claimants

even in breach of policy conditions, and the Insurance

Company is at liberty to recover the same from the owner of

the offending vehicle. The Hon'ble Supreme Court in the case

of Swaran Singh (supra) has held that the liability of insurer to

satisfy the decree passed in favour of the third party is a

statutory one.

18. In the instant case, the Insurance Company has

failed to prove that it was a fundamental breach of the

conditions in the policy, and therefore, the appellants/

claimants would be entitled to receive payment of

compensation jointly and severally from the owner-cum-driver

of the offending vehicle and the Insurance Company.

19. On re-appreciation of the material on record, for

the reasons aforestated, the finding of the Tribunal,

exonerating the Insurance Company altogether, is clearly

erroneous, and therefore, direction is required to be issued to

respondent No. 1 - the owner and respondent No. 2 - Insurance

Company of the offending vehicle, jointly and severally, to pay

the amount of compensation to the claimants in terms of the

order of the Tribunal. Hence, the impugned order is modified

as under :

ORDER

i. The Appeal is partly allowed.

ii. Respondent Nos. 1 and 2 shall jointly and severally

pay compensation of Rs.19,23,000/- with interest @ 7% per

annum from the date of application till realisation to the

appellants/ claimants and respondent No.3 in equal

proportion.

20. Considering the passage of time, direction in point

No.3 of the operative order of the Tribunal, with regard to

investment of the amount in fixed deposit in nationalized bank,

is set-aside.

21. The Appeal stands disposed of. No costs.

JUDGE ******

Sumit