National Insurance Co. Ltd vs Amina Akhtara And 3 Ors
2021 Latest Caselaw 2671 Gua

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GAHC010014432014




                      THE GAUHATI HIGH COURT
  (HIGH COURT OF ASSAM, NAGALAND, MIZORAM AND ARUNACHAL PRADESH)

                         Case No. : MACApp./226/2014

         NATIONAL INSURANCE CO. LTD.
         A COMPANY REGISTERED AND INCORPATED UNDER THE COMPANIES
         ACT, 1956 HAVING ITS REGISTERED OFFICE AT 3, MIDDLETON STREET,
         KALKATA AND ONE OF ITS REGIONAL OFFICE AT G.S. ROAD,
         BHANGAGARH, GUWAHATI, REPRESENTED BY ITS REGIONAL
         MANAGER, GUWAHATI, ASSAM.



         VERSUS

         AMINA AKHTARA and 3 ORS.
         W/O LATE SHIRAJUL HAQUE, R/O VILL. HELOCHARPAM, P.O. NALIGAON,
         P.S. SARTHEBARI, DIST. BARPETA, ASSAM.

         2:MD.SHAMSUL HAQUE

          S/O LATE ALIMUDDIN
          R/O VILL. HELOCHARPAM
          P.O. NALIGAON
          P.S. SARTHEBARI
          DIST. BARPETA
          ASSAM
          BOTH ARE PRESENTLY RESIDING AT PANJABARI
          BATAHGHULI
          MADHUPUR
          HOUSE NO. 3
          GUWAHATI-37
          P.O. PANJABARI
          P.S. SATGAON
          DIST. KAMRUPM
          ASSAM.

         3:TINKU GHOSH
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             S/O LATE NANDALAL GHOSH
             SOLAPARA ROAD
             GUWAHATI-8
             DIST. KAMRUP
             ASSAM.

            4:NIBASH CH.GHOSE

            S/O NAVESH CH. GHOSE
            R/O BRIDHYANAGAR
            P.S. PANBAZAR
            TRIPUR

Advocate for the Petitioner    : MS.S ROY

Advocate for the Respondent : MR.P A AHMEDR-1and2

BEFORE HONOURABLE MR. JUSTICE DEVASHIS BARUAH

JUDGMENT & ORDER (oral) Date : 02-11-2021

Heard Ms. S. Roy, the learned counsel for the appellant and also heard Mr. P.A. Ahmed, the learned counsel for the respondents 1 and 2. None appeared for the other respondents.

2. This appeal has been filed challenging the judgment and award dated 12/05/2014 passed in MAC Case No. 2507/2012 by the Member, Motor Accident Claims Tribunal No. 2, Kamrup(Metro), Guwahati, whereby the Court below awarded an amount of Rs. 9,03,000/- for the death of Sirajul Hoque. The appellant, i.e., the insurance company was directed to pay the awarded amount to the claimant within a period of 90 days from the date of the award, i.e. 12/05/2014 along with interest @ 6 % from the date of filing of the Claim Petition till its realization. It was also directed that Rs.3,00,000/- of the awarded sum will be kept in a fixed deposit in the name of the claimant No. 1 in any Nationalized Bank of her home district for a period of three years. It was also directed that the insurance company would be entitled to deduct the interim compensation paid to the claimant, if any, from the awarded amount.

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3. The appellant, i.e., the insurance company have assailed the impugned judgment and award dated 12/05/2014 on the ground that the Court below, while passing the award, failed to take into consideration that the sitting capacity of the vehicle in question was 38 passengers including driver and the evidence on record clearly indicated that there were 55 passengers including driver on board in the said vehicle, for which the driver failed to concentrate on the wheels at the right time and he got unmindful during late night, which led to the accident. It has been submitted on behalf of the appellant that though, it is admitted that the ill-fated vehicle was insured, but it was limited to only 38 passengers. In this regard, the counsel for the appellant draws my attention to the evidence of one Tapan Chakraborty, who deposed as DW-1 as well as the Exhibits marked as Exhibit A, B, B(1) and Exhibit-C.

4. From a perusal of the Exhibit-C, it transpires that the insurance company insured the ill-fated vehicle with a sitting capacity of 38 passengers. Ext.-B and Ext. B1 are the extracts of the copy of the Lumshnong AD Camp GDE No. 110 dated 08-08-2012 as well as extract copy of Lumshnong AD Camp GDE No. 115 dated 08-08-2012,wherein, it has been categorically mentioned that the ill-fated vehicle fell into a deep gorge at a distance of about 400 ft. from the main road and consequently 28 passengers including two women, main driver and handyman died instantaneously at the spot and 27 passengers, including the driver, sustained injuries thereby showing that the said ill-fated vehicle was plying with 55 occupants which was beyond the insured limit.

5. It is further the submission of the appellant that the Court below failed to take into consideration that there was a breach in the conditions of the insurance agreement between the owner and the insurance company. The Court below could not have directed the insurance company alone to make payment of the entire claim amount. The counsel for the appellant submits that the Supreme Court in the case of United India Insurance Co. Ltd. Vs. K.M. Poonam and Ors. reported in (2015) 15 SCC 297, held that the liability of the insurance company is confined to the number of passengers covered by the insurance policy and not beyond the same. In this regard, the learned counsel for the appellant referred to paragraphs 36,37, 38, 39 and 40 of the said judgment and for the sake of convenience, the same are quoted here-in-below :-

"36. The liability of the insurer, therefore, is confined to the number of persons covered by the Page No.# 4/7

insurance policy and not beyond the same. In other words, as in the present case, since the insurance policy of the owner of the vehicle covered six occupants of the vehicle in question, including the driver, the liability of the insurer would be confined to six persons only, notwithstanding the larger number of persons carried in the vehicle. Such excess number of persons would have to be treated as third parties, but since no premium had been paid in the policy for them, the insurer would not be liable to make payment of the compensation amount as far as they are concerned. However, the liability of the Insurance Company to make payment even in respect of persons not covered by the insurance policy continues under the provisions of sub-section (1) of Section 149 of the Act, as it would be entitled to recover the same if it could prove that one of the conditions of the policy had been breached by the owner of the vehicle.

37. In the instant case, any of the persons travelling in the vehicle in excess of the permitted number of six passengers, though entitled to be compensated by the owner of the vehicle, would still be entitled to receive the compensation amount from the insurer, who could then recover it from the insured owner of the vehicle. As mentioned hereinbefore, in the instant case, the insurance policy taken out by the owner of the vehicle was in respect of six passengers, including the driver, travelling in the vehicle in question. The liability for payment of the other passengers in excess of six passengers would be that of the owner of the vehicle who would be required to compensate the injured or the family of the deceased to the extent of compensation awarded by the Tribunal.

38. Having arrived at the conclusion that the liability of the Insurance Company to pay compensation was limited to six persons travelling inside the vehicle only and that the liability to pay the others was that of the owner, we, in this case, are faced with the same problem as had surfaced in Anjana Shyam's case (supra).

39. The number of persons to be compensated being in excess of the number of persons who could validly be carried in the vehicle, the question which arises is one of apportionment of the amounts to be paid. Since there can be no pick and choose method to identify the five passengers, excluding the driver, in respect of whom compensation would be payable by the Insurance Company, to meet the ends of justice we may apply the procedure adopted in Baljit Kaur's case (supra) and direct that the Insurance Company should deposit the total amount of compensation awarded to all the claimants and the amounts so deposited be disbursed to the claimants in respect to their claims, with liberty to the Insurance Company to recover the amounts paid by it over and above the compensation amounts payable in respect of the persons covered by the Insurance Policy from the owner of the vehicle, as was directed in Baljit Kaur's case.

40. In other words, the Appellant Insurance Company shall deposit with the Tribunal the total amount of the amounts awarded in favour of the awardees within two months from the date of this order and the same is to be utilized to satisfy the claims of those claimants not covered by the Insurance Policy along with the persons so covered. The Insurance Company will be entitled to recover the amounts paid by it, in excess of its liability, from the owner of the vehicle, by putting the decree into execution. For the aforesaid purpose, the total amount of the six Awards which are the highest shall be construed as the liability of the Insurance Company. After deducting the said amount from the total amount of all the Awards deposited in terms of this order, the Insurance Company will be entitled to recover the balance amount from the owner of the vehicle as if it is an amount decreed by the Tribunal in favour of the Insurance Company. The Insurance Company will not be required to file a separate suit in this regard in order to recover the amounts paid in excess of its liability from the owner of the vehicle."

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6. A conjoint reading of the paragraphs quoted here-in-above and taking into consideration the facts of the instant case, as admittedly the ill-fated vehicle was insured covering 38 passengers including the driver, the liability of the insurance company would only be confined to 38 occupants, notwithstanding the fact, that there were 55 occupants on board. The excess number of persons beyond 38 occupants would have to be treated as third parties, but since no premium has been paid to the insurance company, for that the insurance company would not be liable for payment of the compensation as far as they are concerned. However, as the liability of the insurance company to make payment even in respect to persons not covered by the insurance policy continues under the provisions of sub-section (1) of Section 149 of the Motor Vehicles Act, 1988, as it would be entitled to recover the same, if it could prove that one of the conditions has been breached by the owner of the vehicle. In the instant case, the record shows that the owner of the vehicle neither filed their written statement nor adduced any evidence. Ext. B and Ext. B(1) clearly shows that there were 55 occupants on board the ill fated vehicle. Under such circumstances, I hold that the insurance company would be liable to make payment for the entire 55 occupants, but in respect to the occupants beyond 38, the insurance company would be entitled to claim the said amount from the owner of the vehicle, as he had neither pleaded nor proved that he had not breached the terms of the agreement.

7. The next question therefore, arises as to who out of the overloaded occupants, would constitute the occupants covered by the insurance policy and who would be the occupants outside the insurance policy. This aspect of the matter needs to be decided in view of the direction given hereinabove that in respect to the 17 overloaded occupants, the insurance company would be entitled to claim from the owner. In this regard, reference may be made to the judgment of the Supreme Court rendered in the case of National Insurance Co. Ltd Vs. Anjana Shyam and Ors. reported in (2007) 7 SCC 445, wherein the Supreme Court had held that the purpose of the Motor Vehicles Act, 1988 is to bring benefit to the third parties, who are either injured or dead in an accident and it serves a social purpose. In that view of the matter, the Supreme Court held that the practical and the proper course would be to hold that the insurance company would be bound to cover the higher of the amounts of compensation awarded to the extent of the number of passengers covered by the insurance Page No.# 6/7

policy. In this regard paragraphs 22 and 23 of the said judgment is quoted here-in-below:-

"22. Then arises the question, how to determine the compensation payable or how to quantify the compensation since there is no means of ascertaining who out of the overloaded passengers constitute the passengers covered by the insurance policy as permitted to be carried by the permit itself. As this Court has indicated, the purpose of the Act is to bring benefit to the third parties who are either injured or dead in an accident. It serves a social purpose. Keeping that in mind, we think that the practical and proper course would be to hold that the insurance company, in such a case, would be bound to cover the higher of the various awards and will be compelled to deposit the higher of the amounts of compensation awarded to the extent of the number of passengers covered by the insurance policy.

23. Illustratively, we may put it like this. In the case on hand, 42 passengers were the permitted passengers and they are the ones who have been insured by the insurance company. 90 persons have either died or got injured in the accident. Awards have been passed for varied sums. The Tribunal should take into account, the higher of the 42 awards made, add them up and direct the insurance company to deposit that lump sum. Thus, the liability of the insurance company would be to pay the compensation awarded to 42 out of the 90 passengers. It is to ensure that the maximum benefit is derived by the insurance taken for the passengers of the vehicle, that we hold that the 42 awards to be satisfied by the insurance company would be the 42 awards in the descending order starting from the highest of the awards. In other words, the higher of the 42 awards will be taken into account and it would be the sum total of those higher 42 awards that would be the amount that the insurance company would be liable to deposit. It will be for the Tribunal thereafter to direct distribution of the money so deposited by the insurance company proportionately to all the claimants, here all the 90, and leave all the claimants to recover the balance from the owner of the vehicle. In such cases, it will be necessary for the Tribunal, even at the initial stage, to make appropriate orders to ensure that the amount could be recovered from the owner by ordering attachment or by passing other restrictive orders against the owner so as to ensure the satisfaction in full of the awards that may be passed ultimately."

8. In view of the above, I am, therefore, of the opinion, that the appeal is disposed off with a direction to the insurance company to make payment of the entire awarded amount to the claimants along with interest @ 6% per annum within a period of 6(six) weeks from today after deducting the amount already paid to the claimants. The said amount shall be Page No.# 7/7

deposited before the Court below within the said period of 6(six) weeks and the claimants shall be entitled to withdraw the same from the Court below.

9. It is made clear herein that as the insurance policy was only in respect to 38 occupants, the insurance company shall be entitled to recover the amount from the owner if permitted in terms with paragraphs 22 & 23 of the judgment of the Supreme Court rendered in the case of National Insurance Co. Ltd (supra).

10. With the above observations, the instant appeal stands disposed of. The impugned award stands modified in terms of the observations and directions given here-in-above.

11. No costs.

JUDGE

Comparing Assistant