National Insurance Co. Ltd. vs Indra Devi & Ors.
2008 Latest Caselaw 1026 Del

*      HIGH COURT OF DELHI : NEW DELHI

                  MAC App. No.613 of 2007

%                  Judgment reserved on: 8th July, 2008

                   Judgment delivered on:15th July, 2008


National Insurance Co. Ltd.
D.R.O. II,
2-E/9, Jandewala Extension
Delhi-55                                   ....Appellant

                   Through: Mr. S.L. Gupta, Adv.

                            Versus

1.    Indra Devi W/o Late Sh. Ratan Singh
2.    Sanjay S/o Late Sh. Ratan Singh
3.    Roshni D/o. Late Sh. Ratan Singh
4.    Sudesh D/o Late Sh.Ratan Singh
5.    Billu S/o Late Sh.Ratan Singh
6.    Sona Devi W/o Late Sh.Umra Singh

Respondents 1 to 6 are resident of
Village & Post Mubarikpur,
P.S.Farukh Nagar,
Distt.Gurgaon, Haryana

7.    Suraj Pal S/o Sh.Tavel Pal
      (Driver of the Offending Vehicle)
      R/o A-31, Nilothi Exm.Nagloi,
      New Delhi.

8.    Manoj Kumar S/o Sh.Om Prakash
      (Owner of the offending Vehicle)
      R/o RZ-266, New Roshanpura,
      X-I, Block,
      Nazafgarh, Delhi-59.


MAC No.613/2007                                    Page 1 of 11
 9.    Sh.Om Prakash (Insured Offending Vehicle)
      R/o RZ 226, New Roshanpura, XI,
      Block, Nazafgargh, Delhi-59. ...Respondents.

                      Through: Mr.Bhupesh Narula,
                               Adv. for R-1 to 6.
                               Counsel for R-7 to 9.

Coram:
HON'BLE MR. JUSTICE V.B. GUPTA

1. Whether the Reporters of local papers may
   be allowed to see the judgment?                       Yes

2. To be referred to Reporter or not?                    Yes

3. Whether the judgment should be reported
   in the Digest?                                        Yes

V.B.Gupta, J.

The present appeal under Section 173 of the Motor

Vehicles Act, 1988 (for short as the "Act") has been filed by

National Insurance Co. Ltd. against the Interim Award

passed dated 05.07.07, by Sh. Dinesh Kumar Sharma,

Judge, Motor Accident Claims Tribunal (for short as

"Tribunal"), Delhi.

2. Brief facts of the case are that Sh. Rattan Singh, aged

44 years died in a road accident on 20th October 2006 while

travelling in vehicle No. HR 38-M6385 (Tata 407), along

with other farmers of the village. The accident took place

due to rash and negligent driving on the part of driver of

the offending vehicle.

3. The claimants are the legal representatives of the

deceased.

4. Respondent no.7 is the driver, Respondent no.8 is the

owner and Respondent no.9 (in whose name the vehicle is

insured). Respondent no.7, the driver in its written

statement pleaded that the accident took place on account

of the negligence of one motor cycle rider who suddenly

appeared in front of the vehicle being driven by him.

5. Appellant i.e. Insurance Company in its written

statement has admitted that offending vehicle was insured

with it. However, they denied their liability to pay the

compensation on the ground that the deceased was

travelling as a passenger in the alleged offending vehicle.

6. Vide impugned order, the Ld. Tribunal has granted

interim compensation of Rs.50,000/- along with interest @

7% per annum from the date of filing of the petition till

realization in favour of the Petitioners and against the

Respondents.

7. It has been contended by Ld. Counsel for the

Appellant that the Ld. Tribunal was wrong in passing the

interim award of Rs. 50,000/- under Section 140 of the Act

against the Insurance Company for unauthorized

passenger travelling in goods vehicle in view of the latest

decision of the Apex Court in New India Assurance Co.

Ltd. v. Vedwati & Ors., 2007 (3) SCALE 397.

8. Section 140 of the Act provides for liability to pay

compensation in certain cases on the principle on no fault.

9. It read as under;

"140. Liability to pay compensation in certain cases on the principle of no fault.-

(1) Where death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or disablement in accordance with the provisions of this section.

(2) x x x

(3) In any claim for compensation under sub-section (1), the claimant shall not be required to plead and establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act, neglect or default of the owner or owners of the vehicle or vehicles concerned or of any other person. (4) A claim for compensation under sub- section (1) shall not be defeated by reason of any wrongful act, neglect or default of the person in respect of whose death or permanent disablement the claim has been made nor shall the quantum of compensation recoverable in respect of such death or permanent disablement be reduced on the basis of the share of such person in the responsibility for such death or permanent disablement."

10. For getting interim relief under section 140 of the

Act, the Tribunal is only required to see primafacie the

factum of accident involving the offending vehicle and

factum of death of the person in the road accident.

11. The Tribunal has come to a prima facie finding that

the deceased suffered fatal injuries in a road accident

arising out of the use of the offending vehicle. It has also

recorded the Preliminary Statement of the claimant and

claimants have also placed on record a copy of F.I.R and

Post-Mortem report before the Trial Court.

12. In National Insurance Company Limited v.

Swaran Singh and Others, (2004) 3 SCC 297, the Apex

Court has observed as under;

"In each case, on evidence led before the claim Tribunal, a decision has to be taken whether the fact of the driver possessing licence for one type of vehicle but found driving another type of vehicle, was the main or contributory cause of accident. If on facts, it is found that the accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with the driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence."

13. The contention of the Ld. Counsel for Appellant,

regarding the deceased being an unauthorized passenger

travelling in goods vehicle, at this stage is not sustainable,

since evidence is yet to be recorded and the Trial Court has

to decide whether the deceased was travelling as a

passenger in the offending vehicle.

14. Thus the Insurance Company is not liable to pay, is a

matter of evidence which is yet to be gone into by the Trial

Court and these pleas can be raised at the time of final

arguments and not at the stage of interim relief. Thus, the

judgment cited by the Ld. Counsel for Appellant is not

applicable to the facts of the present case.

15. There is no manner of doubt that section140 of the

Act is a beneficial and social welfare piece of legislation. It

is well settled that in construing social welfare legislation,

the Courts should adopt a beneficial rule of construction

and in any event, that construction should be preferred

which fulfills the policy of legislation. The construction to

be adopted on a statue should be such so as to achieve the

purposes for which it is enacted and in favour of those in

whose interest the Act has been passed.

16. The provisions contained under section 140 of the Act

were brought in the statute book to grant interim relief to

the victim of an accident or his dependant/s by way of an

interim compensation. This obviously is a beneficial

provision to give relief to a person who has suffered

grievous injury or to the dependants of a victim who are

left without a bread earner. The object thereof cannot be

permitted to be frustrated. Of course, if the vehicle in

question is not insured at all, the question of making the

insurer liable would not arise. But, the insurer cannot, by

raising all possible pleas, avoid payment of interim

compensation and thereby defeat the object of the

provision.

17. In Shanti Devi v. Basmatti Devi and others, 2007

ACJ 675, the deceased was a Khalasi on Appellant's truck

and this truck met with an accident resulting in his death.

The parents of the deceased filed claim petition for

compensation. During the pendency of the case, they filed

petition under section 140 of the Motor Vehicles Act

claiming interim compensation. The prayer was allowed by

the Patna High Court. While dealing with the question who

amongst the owner and insurance company is liable to pay

the interim compensation under section 140 of the Motor

Vehicles Act, the Court referred the decision of a Division

Bench of the same High Court in Kanhai Rai v.

Dharampal, 2002 ACJ 260 (Patna) wherein the Court

has observed as under;

"(12) No doubt, Section 140 provides that the interim compensation is to be paid by the owner but once an insurance policy in terms of Chapter XI is in force with regard to the motor vehicle covering liability against the third party risk then by virtue of definition of liability under Section 145(c),

the interim compensation is also included or covered by the said policy and the insurance company also becomes liable to pay interim compensation. If this view is not taken, the social purpose for which the provision of Section 140 was enacted will be frustrated. In many cases, there will be difficulty in passing the order of compensation against the driver or owner of the vehicle because they may not be in a position to pay the interim compensation. To obviate such situation and to provide speedy help to the needy claimants, the legislature appears to have also included 'liability' under Section 140 of the Act within the definition of a liability under Section 145(c) of the Act. Thus, there is no difficulty in coming to the conclusion that once an insurance policy is in force with regard to use of motor vehicle at a public place covering liability against the third party risk then the insurer is also liable to pay the interim compensation even though he is not classified as one of the persons against whom an order can be passed under Section 140 of the Act."

18. The Court, further in Kanhai Rai(supra), held as

under;

"(21) Thus, after considering the question involved in this appeal from different angles, I am of the considered view that the order under Section 140 of the Act can be passed against the insurer also in view of the discussions made above. If ultimately it is found at the time of final determination of the question of compensation that the insurer is not liable to pay compensation, then the insurer is not loser or remediless as an order can be passed for reimbursement

of the amount from the owner as held in the case of National Insurance Co. Ltd. v. Jethu Ram, 1998 ACJ 921 (SC)."

19. There was no occasion for the insurance company to

file the present appeal. National Insurance Company Ltd.,

being a Government undertaking should have taken a

sympathetic view in the matter and should not have filed

blindly the present appeal so as to deprive the dependants

of road accident victim, solace and little comfort by way of

meager monetary amount which they are entitled under

the law. The Government undertaking must have human

approach in such like matters and should not indulge in the

jugglery of legal provision so as to deprive the unfortunate

victims of their legal dues. It is hoped that the appellant

would take special care in such like matters and would not

file appeals on frivolous and flimsy grounds so as to

deprive the victims of road accident who had lost their sole

bread earner.

20. In the present case, appeal filed by National

Insurance Co. Ltd., which is public sector undertaking, is

nothing but an abuse of the process of law. Therefore,

there is no scope to challenge the impugned order.

21. The present appeal is, therefore, dismissed with costs

of Rs.5,000/-.

22. Appellant is directed to deposit the cost by way of a

cheque in the name of Registrar General of this Court

within four weeks from today.

23. List on 20th August, 2008 for compliance.

July 15, 2008                              V.B.GUPTA, J.
Bisht