Bombay High Court
Trilochansing S/O Milaramji Arora vs Premdas S/O Domaji Jivane And 3 Others on 7 November, 2025
2025:BHC-NAG:11611
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR
FIRST APPEAL NO. 1220 OF 2013
Trilochansing s/o Milaramji Arora
Aged about : 50 Years; Occu - Business;
R/o C/o Milaramji Arora, Ward No.1, At
Post Bhiwapur, District Nagpur. ... APPELLANT
VERSUS
1. Premdas s/o Domaji Jivane
Aged : Major, Occu : Not known;
2. Smt. Sarubai w/o Premdas Jivane
Age : Major, Occu : Not known;
3. Master Aniket s/o Galfas Jivane
Aged : 15 Years; Occu : Not known;
Respondent No.3 being minor, through
Guardian Grandfather i.e. Respondent No.1.
Respondent Nos.1 to 3 R/o Kingaon, At Post
Bothoda, Tahsil Hinganghat, District
Wardha.
4. The United India Insurance Company Ltd.
Through its Divisional Manager, Divisional
Office, Mount Road, Sadar, Nagpur. ... RESPONDENTS
Mr. C. B. Dharmadhikari, Advocate for Appellant.
Mr. D. P. Bhongade, Advocate for Respondent Nos.1 to 3.
Mr. Pratik Jain, Advocate h/f Mr. M. R. Joharapurkar, Advocate for Respondent
No.4.
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CORAM : PRAVIN S. PATIL, J.
ARGUMENTS HEARD ON : OCTOBER 08, 2025.
PRONOUNCED ON : NOVEMBER 07, 2025.
JUDGMENT
. Heard Mr. C. B. Dharmadhikari, learned Counsel for the Appellant,
Mr. D. P. Bhongade, learned Counsel for the Respondent Nos.1 to 3 and Mr.
Pratik Jain, Advocate h/f Mr. M. R. Joharapurkar, learned Counsel for the
Respondent No.4.
2. The present Appeal is filed by the owner of the vehicle challenging
the Judgment and order dated 28/3/2013 passed by the Motor Accident
Claims Tribunal, Nagpur in Claim Petition No. 533/2003.
3. The undisputed facts of the present matter are that, the
Respondents are legal heirs of deceased Galfas Premdas Jivane, who died in
motor vehicular accident on 6/3/2003. It is the case of the Claimants that
deceased was working as a labour on truck No. MH-31/W-7464. On 6/3/2003
deceased was traveling in the offending vehicle i.e. truck which was going
from Bhiwapur to Umrer road. During this traveling period, he fell down from
the Truck on the road and died on the spot. As such, the Claimants have filed
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Claim Petition before the Motor Accident Claims Tribunal, Nagpur for just and
reasonable compensation.
4. The present Appeal has been filed by the owner of the offending
vehicle on the ground that the offending vehicle was duly insured with
Respondent No.4. There was no rash or negligent driving of the driver of the
truck. The deceased himself was responsible for the accident. According to
him, the finding of learned Tribunal that driver of the offending vehicle was
equally responsible for the accident is based upon the police case papers,
which is not sustainable in the matter. He has specifically pointed out that in
Criminal Case No. 749/2003 the truck driver was acquitted from the offence
under Section 304-A of Indian Penal Code by the Judicial Magistrate First
Class, Umred vide Judgment dated 26/9/2007. The learned Magistrate held
that the Informant Mansaram has denied the contents of First Information
Report. In short, it is the contention of the Appellant that conclusion of the
learned Tribunal that the driver of the offending vehicle is responsible for the
accident is erroneous in the matter. Therefore, the Appellant seeks indulgence
of this Court in the matter.
5. Per contra, the learned Counsel appearing for Insurance Company
vehemently opposed this Appeal. According to him, police case papers,
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particularly, First Information Report reveals the fact that the Informant, while
lodging police complaint, specifically stated that on 5/3/2003 the truck was
carrying marriage party (Barati) and accident occurred due to rash and
negligent driving of the driver. Hence, according to him, this amounts to a
breach of policy, and therefore, the conclusion drawn by the learned Tribunal
cannot be followed in the matter.
6. The learned Counsel for Claimants i.e. Respondent Nos.1 and 2
stated that due to accident the bread earner of the family lost his life, and
therefore, they are entitled for compensation amount, either from the
Appellant or from the Respondent No.4/Insurance Company. Due to the
dispute between them, Claimants are unnecessarily harassed in the matter and
waiting for the fruits of the Judgment delivered by the Tribunal.
7. In the light of above factual position, I have perused the entire
record and also the case laws, which both parties have relied upon in the
matter and proceed to decide the present Appeal.
8. In the present Appeal, the only issue, which is to be considered
and decided is, as to whether the exoneration of the Respondent
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No.4/Insurance Company from payment of compensation is justified in the
facts and circumstances of the case or not.
9. Firstly, it is to be noted that the Respondent No.4/Insurance
Company did not place on record the copy of Insurance policy to demonstrate
that which condition was breached; and secondly, as to how the breach of the
policy amounts to fundamental breach on the basis of evidence. According to
me, to demonstrate this fact, it was necessary for the Insurance Company to
enter into the witness-box and at least prove from the documentary evidence
the breach of conditions of policy, but admittedly no such proof is available on
record.
10. It will be relevant to refer the Judgment of the Hon'ble Supreme
Court in the case of Suraj Mal Ram Niwas Oil Mills Private Limited V/s United
India Insurance Company Limited and Another, (2010) 10 Supreme Court
Cases 567, wherein in paragraph Nos. 23 and 26 the Hon'ble Supreme Court
has observed as under:
"23. Before embarking on an examination of the correctness of the
grounds of repudiation of the policy, it would be apposite to examine
the nature of a contract of insurance. It is trite that in a contract of
insurance, the rights and obligations are governed by the terms of
the said contract. Therefore, the terms of a contract of insurance
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have to be strictly construed, and no exception can be made on the
ground of equity.
26. Thus, it needs little emphasis that in construing the terms of a
contract of insurance, the words used therein must be given
paramount importance, and it is not open for the court to add,
delete or substitute any words. It is also well settled that since upon
issuance of an insurance policy, the insurer undertakes to indemnify
the loss suffered by the insured on account of risks covered by the
policy, its terms have to be strictly construed to determine the extent
of liability of the insurer. Therefore, the endeavour of the court
should always be to interpret the words in which the contract is
expressed by the parties."
So also the Judgment in the case of B. V. Nagaraju V/s Oriental
Insurance Company Ltd. Divisional Officer, Hassan, (1996) 4 Supreme Court
Cases 647. The observation of the Supreme Court in paragraph No.7 is as
under :
"7. It is plain from the terms of the Insurance Policy that the
insured vehicle was entitled to carry 6 workmen, excluding the
driver. If those 6 workmen when traveling in the vehicle, are
assumed not to have increased any risk from the point of view of the
Insurance Company on occurring of an accident, how could those
added persons be said to have contributed to the causing of it is the
poser, keeping apart the load it was carrying. Here, it is nobody's
case that the driver of the insured vehicle was responsible for the
accident. In fact, it was not disputed that the oncoming vehicle had
collided head-on against the insured vehicle, which resulted in the
damage. Merely by lifting a person or two, or even three, by the
driver or the cleaner of the vehicle, without the knowledge of the
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owner, cannot be said to be such a fundamental breach that the
owner should, in all events, be denied indemnification. The misuse
of the vehicle was somewhat irregular though, but not so
fundamental in nature so as to put an end to the contract, unless
some factors existed which, by themselves, had gone to contribute to
the causing of the accident. In the instant case, however, we find no
such contributory factor. In Skandia case¹ this Court paved the way
towards reading down the contractual clause by observing as
follows: (SCC pp. 665- 66, para 14) When the option is between
opting for a view which will relieve the distress and misery of the
victims of accidents or their dependents on the one hand and the
equally plausible view which will reduce the profitability of the
insurer in regard to the occupational hazard undertaken by him by
way of business activity, there is hardly any choice. The Court cannot
but opt for the former view. Even if one were to make a strictly
doctrinaire approach, the very same conclusion would emerge in
obeisance to the doctrine of 'reading down' the exclusion clause in
the light of the 'main purpose' of the provision so that the 'exclusion
clause' does not cross swords with the 'main purpose' highlighted
earlier. The effort must be to harmonize the two instead of allowing
the exclusion clause to snipe successfully at the main purpose The
theory which needs no support is supported by Carter's 'Breach of
Contract' vide paragraph 251. To quote:
"Notwithstanding the general ability of contracting parties to agree
to exclusion clauses which operate to define obligations there exists
a rule, usually referred to as the 'main purpose rule', which may limit
the application of wide exclusion clauses defining a promisor's
contractual obligations. For example, in Glynn v. Margetson & Co.2
(AC at p. 357), Lord Halsbury, L.C. stated:
'It seems to me that in construing this document, which is a contract
of carriage between the parties, one must in the first instance look at
the whole instrument and not at one part of it only. Looking at the
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whole instrument, and seeing what one must regard as its main
purpose, one must reject words, indeed whole provisions, if they are
inconsistent with what one assumes to be the main purpose of the
contract.
Although this rule played a role in the development of the doctrine
of fundamental breach, the continued validity of the rule was
acknowledged when the doctrine was rejected by the House of Lords
in Suisse Atlantique Societe d' Armement Maritime SA V. NV
Rotterdamsche Kolen Centrale³. Accordingly, wide exclusion clauses
will be read down to the extent to which they are inconsistent with
the main purpose, or object of the contract."
So also in the case of Lakhmi Chand V/s Reliance General Insurance, (2016) 3
Supreme Court Cases 100, the Hon'ble Supreme Court, by considering its
earlier Judgments, has observed in paragraph No.16 as under :
"16. It becomes very clear from a perusal of the above mentioned
case law of this Court that the insurance company, in order to avoid
liability must not only establish the defence claimed in the
proceeding concerned, but also establish breach on the part of the
owner/insured of the vehicle for which the burden of proof would
rest with the insurance company. In the instant case, the respondent
Company has not produced any evidence on record to prove that the
accident occurred on account of the overloading of passengers in the
goods-carrying vehicle. Further, as has been held in B. V. Nagaraju
that for the insurer to avoid his liability, the breach of the policy
must be so fundamental in nature that it brings the contract to an
end. In the instant case, it is undisputed that the accident was in fact
caused on account of the rash and negligent driving of the offending
vehicle by its driver, against whom a criminal case vide FIR No. 66 of
2010 was registered for the offences referred to supra under the
provisions of IPC. These facts have not been taken into consideration
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by either the State Commission or the National Commission while
exercising their jurisdiction and setting aside the order of the District
Forum. Therefore, the judgment and order of the National
Commission dated 26-4-2013 passed in Lakhmi Chand v. Reliance
General Insurance is liable to be set aside, as the said findings
recorded in the judgment are erroneous in law."
In addition to abovesaid case laws, it will be relevant to refer the Judgment of
Hon'ble Supreme Court, in the case of National Insurance Company Ltd. V/s
Swaran Singh & Others, 2004(5) Bom.C.R. 467 , wherein the Hon'ble Supreme
Court has laid down the certain principles in the form of summary of finding in
paragraph No.110 of the Judgment, which is reproduced as under :
"110. The summary of our findings to the various issues as
raised in these petitions is as follows :
(i) Chapter XI of the Motor Vehicles Act, 1988 providing
compulsory insurance of vehicles against third-party risks is a special
welfare legislation to extend relief by compensation to victims of
accidents caused by use of motor vehicles. The provisions of
compulsory insurance coverage of all vehicles are with this
paramount object and the provisions of the Act have to be so
interpreted as to effectuate the said object.
(ii) An insurer is entitled to raise a defence in a claim
petition filed under section 163-A or section 166 of the Motor
Vehicles Act, 1988, inter alia, in terms of section 149(2)(a)(ii) of the
said Act.
(iii) The breach of policy condition e.g. disqualification of
the driver or invalid driving licence of the driver, as contained in
sub-section (2)(a)(ii) of section 149, has to be proved to have been
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committed by the insured for avoiding liability by the insurer. Mere
absence, fake or invalid driving licence or disqualification of the
driver for driving at the relevant time, are not in themselves
defences available to the insurer against either the insured or the
third parties. To avoid its liability towards the insured, the insurer or
the third parties. To avoid its liability towards the insured, the
insurer has to prove that the insured was guilty of negligence and
failed to exercise reasonable care in the matter of fulfilling the
condition of the policy regarding use of vehicles by a duly licensed
driver or one who was not disqualified to drive at the relevant time.
(iv) Insurance companies, however, with a view to avoid
their liability must not only establish the available defence(s) raised
in the said proceedings but must also establish "breach" on the part
of the owner of the vehicle; the burden of proof wherefor would be
on them.
(v) The Court cannot lay down any criteria as to how the
said burden would be discharged, inasmuch as the same would
depend upon the facts and circumstances of each case.
(vi) Even where the insurer is able to prove breach on the
part of the insured concerning the policy condition regarding
holding of a valid licence by the driver or his qualification to drive
during the relevant period, the insurer would not be allowed to
avoid its liability towards the insured unless the said breach or
breaches on the condition of driving licence is/are so fundamental as
are found to have contributed to the cause of the accident. The
Tribunals in interpreting the policy conditions would apply "the rule
of main purpose" and the concept of "fundamental breach" to allow
defences available to the insurer under section 149(2) of the Act.
(vii) The question, as to whether the owner has taken
reasonable care to find out as to whether the driving licence
produced by the driver (a fake one or otherwise), does not fulfil the
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requirements of law or not will have to be determined in each case.
(viii) If a vehicle at the time of accident was driven by a
person having a learner's licence, the insurance companies would be
liable to satisfy decree.
(ix) The Claims Tribunal constituted under section 165 read
with section 168 is empowered to adjudicate all claims in respect of
the accidents involving death or of bodily injury or damage to
property of third party arising in use of motor vehicle. The said
power of the Tribunal is not restricted to decide the claims inter se
between claimant or claimants on one side and insured, insurer and
driver on the other. In the course of adjudicating the claim for
compensation and to decide the availability of defence or defences
to the insurer, the Tribunal has necessarily the power and
jurisdiction to decide disputes inter se between the insurer and the
insured. The decision rendered on the claims and disputes inter se
between the insurer and insured in the course of adjudication of
claim for compensation by the claimants and the award made
thereon is enforceable and executable in the same manner as
provided in section 174 of the Act for enforcement and execution of
the award in favour of the claimants.
(x) Where on adjudication of the claim under the Act the
Tribunal arrives at a conclusion that the insurer has satisfactorily
proved its defence in accordance with the provisions of section
149(2) read with sub-section (7), as interpreted by this Court above,
the Tribunal can direct that the in- surer is liable to be reimbursed by
the insured for the compensation and other amounts which it has
been compelled to pay to the third party under the award of the
Tribunal. Such determination of claim by the Tribunal will be
enforceable and the money found due to the insurer from the
insured will be recoverable on a certificate issued by the Tribunal to
the Collector in the same manner under section 174 of the Act as
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arrears of land revenue. The certificate will be issued for the
recovery as arrears of land revenue only if, as required by sub-
section (3) of section 168 of the Act the insured fails to deposit the
amount awarded in favour of the insurer within thirty days from the
date of announcement of the award by the Tribunal.
(xi) The provisions contained in sub-section (4) with the
proviso there- under and sub-section (5) which are intended to cover
specified contingencies mentioned therein to enable the insurer to
recover the amount paid under the contract of insurance on behalf
of the insured can be taken recourse to by the Tribunal and be
extended to claims and defences of the insurer against the insured
by relegating them to the remedy before regular Court in cases
where on given facts and circumstances adjudication of their claims
inter se might delay the adjudication of claims of victims."
From the abovesaid legal position, it is clear that if any one is
coming with a case that there is a breach or infringement of insurance policy, it
is for the Insurance Company to establish that the insured was guilty of an
infringement/violation of the terms of policy. The insurer has also to satisfy the
Tribunal or Court that such violation or infringement was on the part of
insured and due to such incident, which is established on the basis of oral and
documentary evidence on record that there is a fundamental breach of terms
and conditions of the policy. In absence of same, Insurance Company could not
be absolved from liability in the matter.
11. The learned Counsel for Respondent No.4 has relied upon some
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Judgments of the Hon'ble Supreme Court, particularly, National Insurance
Company Ltd. V/s Cholleti Bharatamma and Others, (2008) 1 Supreme Court
Cases 423; National Insurance Company Ltd. V/s Kaushalaya Devi and Others,
(2008) 8 Supreme Court Cases 246; Oriental Insurance Company Ltd. V/s Brij
Mohan and Others, (2007) 7 Supreme Court Cases 56; Narayanan and another
V/s Mathan Mathai, 1981 SCC OnLine Ker 155; and National Insurance
Company Ltd. V/s Rattani and Ors. AIR 2009 SUPREME COURT 1499 . From
these Judgments attempt was made to draw conclusion that vehicle which was
insured as goods vehicle cannot carry labourer or other gratuitous passengers
in the vehicle, same amounts to violation of the terms of the policy. The
proposition of law laid down in above cases is not disputed. However, after
perusal of these Judgments, one factor which needs consideration is that
Insurance Company in all theses cases entered into the witness-box and
established before the Competent Court that how there was a breach of the
terms and conditions of the policy and same amount to fundamental breach of
the policy. Therefore, on the basis of evidence made available before the
Tribunal, the conclusion was drawn that there was a breach of policy.
Therefore, I am of the opinion that unless such evidence is brought on record,
the Judgment relied upon by the Respondent No.4 are not helpful to him in
the matter.
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12. The Respondent No.4 has strongly relied upon the police papers.
Per contra, the Appellant has also placed on record the copy of final Judgment
in the criminal case registered against the driver of the offending vehicle. The
Complainant, in the said proceeding, specifically stated that he is not aware
about the incident and denied the fact of lodging FIR by him, and on that basis
driver of the offending vehicle was acquitted from the criminal proceeding.
Therefore, prima facie, the documents relied upon by the Tribunal seems to be
not trustworthy. So also instead of relying upon the police case papers it is
always expected that some efforts should be taken by the Insurance Company
to bring on record the evidence and prove its case, but no such efforts are seen
to be taken on the part of Respondent No.4/Insurance Company.
13. As states above, in the case of Swaran Singh (supra), the Hon'ble
Supreme Curt of India has categorically held that if according to the Insurance
Company, there is a specific submission that there was a breach of policy, it is
the responsibility of the Insurance Company to prove the same by cogent
evidence on record. It is also required to be established that breach of the
policy on the part of owner of the vehicle is a fundamental breach, and
therefore, the Insurance Company should be exonerated and owner of the
vehicle should be burdened the entire compensation amount.
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14. In the same manner as in the case of Lakhmi Chand (supra), the
Hon'ble Supreme Court has held that if the Insurance Company failed to
produce any evidence on record to prove that accident had occurred on
account of overloading of passengers in the goods carriage vehicle, it is the
responsibility of the Insurance Company to establish that the breach of policy
is so fundamental in nature that it brings the contract to an end. Thus, both
these case laws are squarely applicable in the present matter.
15. Coming to the facts of the present Appeal, it is not established on
record by cogent evidence that where was the deceased sitting in the truck at
the time of accident and if the truck was carrying marriage party, why any
person from that marriage party or atleast the Informant was not examined
before the Tribunal. The Insurance Company, which was expected to conduct
the preliminary enquiry in the matter, failed to take any efforts to reach to the
conclusion that the accident occurred because the marriage party was traveling
in the vehicle. Hence, in absence of any such evidence available on record,
holding responsible the owner on the basis of presumption, is not expected
from the Tribunal.
16. Therefore, I am of the opinion that the learned Tribunal failed to
consider the legal position in the right perspective and exonerated the
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Insurance Company from the payment of compensation. Impugned order
needs modification to the extent that owner of the offending vehicle and the
Insurance Company are jointly and severally liable to pay the compensation.
Hence, I proceed to pass following order.
ORDER
1. The First Appeal is allowed.
2. The Judgment and order dated 28/3/2013 passed by the Motor
Accident Claims Tribunal, Nagpur in Claim Petition No. 533/2003 is
modified to the extent that the Appellant as well as the Respondent
No.4/Insurance Company are jointly and severally liable to pay
compensation amount awarded by Motor Accident Claims Tribunal to
the Respondent Nos.1 to 3/Claimants.
3. The Respondent No.4/Insurance Company is directed to deposit the
compensation amount as per the Judgment of the Tribunal within a
period of three months, either with the Registry of this Court or with the
Motor Accident Claims Tribunal, Nagpur with due intimation to the
Claimants.
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4. The Claimants are entitled to withdraw the amount after depositing
same by the Respondent No.4/Insurance Company.
5. No order as to costs.
[PRAVIN S. PATIL, J.]
vijaya
Signed by: Mrs. V.G. Yadav
Designation: PS To Honourable Judge
Date: 07/11/2025 18:52:28
