The Oriental Insurance Co. Ltd. vs Babu Ram & Ors
2012 Latest Caselaw 5301 Del

$~4
*      IN THE HIGH COURT OF DELHI AT NEW DELHI

                                       Decided on: 5th September, 2012
+      MAC.APP. 170/2005

       THE ORIENTAL INSURANCE CO. LTD.         ..... Appellant
                     Through Mr. Pankaj Seth, Advocate

                        versus

       BABU RAM & ORS                              .... Respondents
                    Through           Nemo

       CORAM:
       HON'BLE MR. JUSTICE G.P.MITTAL
                      JUDGMENT

G. P. MITTAL, J. (ORAL)

1. By virtue of this Appeal, the Appellant Oriental Insurance Co. Ltd.

seeks recovery rights in respect of the compensation which it was made liable to pay in the Claim Petition RBT-5/2003 (Old No.293/99).

2. On 03.11.1998 at about 9:00 am, deceased Ram Das was riding his bicycle from his house at Shastri Park to the Telephone Exchange, Idgah. He suffered fatal injuries on account of his cycle being struck by a TSR No.DL-1RC-3464 which was driven by Rajender Shah, the Second Respondent in a rash and negligent manner. The TSR was owned by the Third Respondent.

3. On appreciation of evidence, the Motor Accident Claims Tribunal (the Claims Tribunal) found that the accident was caused by the rash and negligent driving of the TSR by the Second Respondent.

The Claims Tribunal awarded a compensation of `3,70,000/- to the Claimant.

4. The finding on negligence and quantum of compensation is not disputed by the Appellant Insurance Company.

5. The only ground of challenge is that the Appellant successfully proved the breach of the terms of the policy, yet it was declined recovery rights.

6. I have before me the Trial Court record. In the written statement dated 15.12.1999 filed by the Appellant, a plea was taken that if the TSR No. DL-1RC-3464 was driven by a person without a proper and valid driving licence, the Appellant would not be liable to pay the compensation. A written statement was filed by the Respondents No.2 and 3 on 07.11.2000(the driver and the owner). There was not even a whisper that the Second Respondent possessed a valid driving licence to drive the TSR.

7. During the course of inquiry, a notice under Order XII Rule 8 CPC (Ex.R3W1/2) was posted to the owner and the driver at the addresses as mentioned in the Claim Petition. The address of the owner(Respondent No.3 herein) and the driver(Respondent No.2) was the same as was mentioned in the Claim Petition. They were served with the notice of the Claim Petition on this address. They appeared in the Court and filed their written statement. The postal receipts were proved as Exs. R3W1/3, R3W1/4 and R3W1/5.

8. The Claims Tribunal declined to accept the service of the notice through postal receipts Exs.R3W1/3, R3W1/4 and R3W1/5 as the AD card was not received. This approach of the Claims Tribunal is against the basic principles of the rule of evidence as per

Illustration (f) to Section 114 of the Evidence Act.

9. Apart from this, a certified copy of the charge sheet against the Second Respondent for an offence under Section 279, 304 IPC and Section 3/181 of the Motor Vehicles Act, 1988(the Act) was proved as Ex.PW1/1 to show that the Second Respondent was prosecuted for driving the TSR without a valid driving licence. The Appellant Insurance Company thus proved that the Second Respondent was prosecuted for driving the offending TSR without a driving licence, it proved the notice Ex.R3W1/2 whereby the Respondents No.2 and 3 were called upon to produce the original insurance policy and the driving licence of the driver and it also proved the copy of the insurance policy Ex.R3W1/1 containing a condition that the Insurance Company would not be liable if the person driving the vehicle, including the insured, did not hold an effective driving licence at the time of the accident. Thus, the Insurance Company did whatever was in its power to prove that there was willful and conscious breach of the terms of policy on the part of the insured. The Respondents No.2 and 3, that is, the driver and the owner preferred not to contest the proceedings before the Claims Tribunal after filing the written statement. They were, therefore, ordered to be proceeded ex parte. The Respondent No.3, owner of the TSR, preferred not to contest this Appeal also. In the circumstances, the Appellant should have been granted recovery rights against the owner of the offending vehicle (Respondent No.3 herein).

10. I am supported in this view by the judgment of this Court in New India Assurance Company Ltd. v. Sanjay Kumar & Ors., ILR

(2007) 11 Delhi 733, wherein it was held as under:

"23. Where the assured chooses to run away from the battle i.e. fails to defend the allegation of having breach the terms of the insurance policy by opting not to defend the proceedings, a presumption could be drawn that he has done so because of the fact that he has no case to defend. It is trite that a party in possession of best evidence, if he withholds the same, an adverse inference can be drawn against him that had the evidence been produced, the same would have been against said person. As knowledge is personal to the person possessed of the knowledge, his absence at the trial would entitle the insurance company to a presumption against the owner.

24. That apart, what more can the insurance company do other than to serve a notice under Order 12 Rule 8 of the Code of Civil Procedure calling upon the owner as well as the driver to produce a valid driving licence. If during trial such a notice is served and proved to be served, non response by the owner and the driver would fortify the case of the insurance company."

11. In view of the above discussion, the Appeal is allowed and the Appellant is granted right to recover the compensation paid to the First Respondent.

12. Statutory amount of `25,000/- shall be refunded to the Appellant Insurance Company.

13. Pending Applications stand disposed of.

(G.P. MITTAL) JUDGE SEPTEMBER 05, 2012 pst