Oriental Insurance Company Ltd vs Tribe (Tariben) Vigabhai ...
2021 Latest Caselaw 18659 Guj

    C/FA/5700/2008                             JUDGMENT DATED: 22/12/2021



            IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                     R/FIRST APPEAL NO. 5700 of 2008
                                  With
                     R/FIRST APPEAL NO. 5701 of 2008
                                  With
                     R/FIRST APPEAL NO. 5702 of 2008
                                  With
                     R/FIRST APPEAL NO. 5703 of 2008
                                  With
                     R/FIRST APPEAL NO. 5704 of 2008
                                  With
                     R/FIRST APPEAL NO. 5705 of 2008
                                  With
                     R/FIRST APPEAL NO. 5706 of 2008
                                  With
                     R/FIRST APPEAL NO. 5707 of 2008
                                  With
                     R/FIRST APPEAL NO. 5708 of 2008

FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE HEMANT M. PRACHCHHAK
================================================================

1   Whether Reporters of Local Papers may be allowed                 No
    to see the judgment ?

2   To be referred to the Reporter or not ?                          Yes

3   Whether their Lordships wish to see the fair copy                No
    of the judgment ?

4   Whether this case involves a substantial question                No
    of law as to the interpretation of the Constitution
    of India or any order made thereunder ?

================================================================
               ORIENTAL INSURANCE COMPANY LTD
                             Versus
     TRIBE (TARIBEN) VIGABHAI CHANDIABHAI GAMIT & 3 other(s)
================================================================
Appearance:
MR GC MAZMUDAR(1193) for the Appellant(s) No. 1
MR HG MAZMUDAR(1194) for the Appellant(s) No. 1
MR HEMANT B RAVAL(3491) for the Defendant(s) No. 3
MR.HIREN M MODI(3732) for the Defendant(s) No. 1,2
RULE SERVED(64) for the Defendant(s) No. 4
================================================================



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      C/FA/5700/2008                           JUDGMENT DATED: 22/12/2021




 CORAM:HONOURABLE MR. JUSTICE HEMANT M.
       PRACHCHHAK

                          Date : 22/12/2021

                      COMMON ORAL JUDGMENT

1. These nine appeals are filed challenging the judgment and

award dated 16.02.2008 passed by the Motor Accident Claims

Tribunal (Aux.), Vyara at Surat in M.A.C.P. Nos.401/2001,

402/2001, 403/2001, 404/2001, 405/2001, 406/2001, 408/2001,

833/2001 and 834/2001 whereby the Tribunal has partly allowed

the respective claim petitions.

2. Short facts of the present appeals are that on 10.05.2001,

the injured persons had gone to Navasari Krishi Vidyalaya in a

jeep hired by them for information and training of modern

agriculture and while returning from there, due to the negligent

driving of opponent no.1 - driver of the jeep, the jeep over

turned and the occupants got injuries, which resulted into the

permanent partial disablement and death.

3. Learned counsel appearing for the appellant - Insurance

Company has submitted the same facts which are narrated in

the memo of appeal. He has submitted that the Tribunal has

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

passed the award without considering the material evidence on

record. He has submitted that the claimant has to prove the

pleadings and cannot go beyond the pleadings and as per the

principle of law decided by the Higher Courts that without

pleading, the evidence cannot be considered, however, the

Tribunal has erred by not following the said principle of law and

passed the impugned award. He has submitted that the

passengers including the claimants were gratuitous passengers

and the claimants have hired the jeep. He has submitted that the

Tribunal has not considered the fact that the claimant had

categorically admitted in the pleading about hiring the jeep to go

to Navsari. He has submitted that the Tribunal has committed an

error by considering that additional premium was paid so

Insurance Company can be held liable though the question was

breach of condition of policy wherein the vehicle was not to be

used for hire and reward, however, they have not disputed the

quantum. He has submitted that the present appeals may be

allowed.

4. Learned counsel appearing for respondents no.1 and 2 and

learned counsel appearing for respondent no.3 supported the

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

impugned judgment and award passed by the Tribunal and

argued that there was no error committed by the Tribunal in

passing the award holding the liability of the present appellant -

Insurance Company. They submitted that in any case, if the

present appellant would be exonerated from the liability of

paying the compensation, at the first instance, the appellant

should satisfy the impugned judgment and award passed by the

Tribunal and, thereafter, may recover the amount of

compensation from the owner of the vehicle. Ultimately, it was

requested by learned counsel appearing for the respective

respondents to dismiss the appeals.

5. I have heard learned counsel appearing for the respective

parties and perused the record and proceedings of the case and

submissions made by the learned counsel of the respective

parties and averments made in all the appeals. It appears from

the record that the appellant - Insurance Company has preferred

the present appeals challenging the impugned judgment and

award on the ground that all the claimants of the claim petitions

were travelling in a jeep car as passengers on hire and reward

and, therefore, the Insurance Company cannot be held liable for

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

any compensation. Considering the decisions of the Hon'ble

Apex Court as well as of this Hon'ble Court in the case of

Manuara Khatun and others Vs. Rajesh Kumar Singh and

others, (2017) 4 SCC 796, Oriental Insurance Company

Limited Vs. Ashwinkumar P. Upadhyay and others, 2019)

Law Suit (Gujarat) 383 = 2020 (2) G.L.H. 7 and ICICI

Lombard General Insurance Company Limited Vs. Chavda

Gomatben Galabhai and others, 2020 Law Suit (Gujarat)

137, the impugned judgment and award is required to be

quashed and set aside to the extent that the liability cannot be

fastened upon the present appellant.

6. In the case of Manuara Khatun (supra), the Hon'ble

Supreme Court has held in paragraphs no.13, 17 and 18 as

under:-

13. The only question, which arises for consideration in these appeals, is whether the appellants are entitled for an order against the Insurer of the offending vehicle, i.e. (Respondent No. 3) to pay the awarded sum to the appellants and then to recover the said amount from the insured (owner of the offending vehicle-Tata Sumo) - Respondent No.1 in the same proceedings.

17. The facts of the case at hand are somewhat identical to the facts of the case mentioned supra because here also we find that the deceased were found travelling as "gratuitous passengers" in the offending vehicle and it was for this reason, the insurance companies were exonerated. In Saju P. Paul case (supra) also having held that the victim

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

was "gratuitous passenger", this Court issued directions against the Insurer of the offending vehicle to first satisfy the awarded sum and then to recover the same from the Insured in the same proceedings.

18. Learned counsel for Respondent No. 3 (United India Insurance Company Ltd.), however, contended that the facts of the case at hand are not identical to the one involved in the case of Saju P. Paul (supra) and hence the law laid down therein cannot be applied to the facts of the case at hand. Learned counsel pointed out that firstly, the awarded compensation in this case is quite substantial and secondly, it is not yet paid to the claimants. Learned counsel also submitted that since the question involved herein is referred to a larger Bench and hence this Court should not give such directions, as prayed by the appellants, against the Insurance Company.

7. In the case of Chavda Gomatben Galabhai (supra), this

Court has held in paragraphs no.7, 8 and 9 as under:-

7. Therefore, it has to be held that deceased Gallabhai Dudabhai Chavda was an illegal traveler in the rickshaw. He had seated by-side the driver in the front of rickshaw, where there was no sitting capacity and sitting thereat was not permissible. The deceased travelled illegally in the rickshaw. There was a breach of terms and conditions of policy. For death of such traveler passenger, the insurance company could not have been held liable in law to pay the compensation. The contention raised by the appellant company is upheld.

8. Even as above is held that the insurer is required to be absolved from its liability to pay the compensation, the immediate next question would be whether the insurance company should be first asked to pay the amount of compensation and subsequently may be allowed to recover. The Supreme Court has propounded the principle of 'pay and recover' considering the object of the legislation of the Motor Vehicles Act, 1988. Learned advocate for the respondents on this aspect relied on the decision of the Supreme Court in Manuara Khatun & Ors. Vs. Rajesh Kr. Singh (2017) 2 ACC 476 (SC). Another decision of the Full bench of this Court in Shantaben & Ors. Vs. Yakubbhai Imbrahihmbhai Patel & Ors. [2013 3 ACC 629 (FB) (Guj.)]

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

was also pressed into service.

8.1 In Manuara Khatun (supra), the case was of a gratuitous passenger, who died due to the rash and negligent driving of the offending vehicle. The Apex Court applied 'pay and recover' principle and granted recovery rights to the insurer. In Shantaben (supra), the Full Bench of this court in the facts of the case before it, where the insurer had limited liability, permitted it to recover excess amount but firstly requiring to pay the entire.

8.2 In National Insurance Co. Ltd. Vs. Anjana Shyam and Others, (2007) 7 SCC 445, the Supreme Court while dealing with the case where number of victims in accident exceeding the number of persons permitted to be carried, granted decree to the insurance company to recover the amount from the owner. The Apex Court in Manuara Khatun (supra), noticed other decisions also on the aspect to observed that the question was no longer res integra

"The aforesaid question, in our opinion, remains no more res integra. As we notice, it was subject matter of several decisions of this Court rendered by three Judge Bench and two Judge Bench in past, viz., National Insurance Co. Ltd. vs. Baljit Kaur & Ors., (2004) 2 SCC 1, National Insurance Co. Ltd. vs. Challa Upendra Rao & Ors., (2004) 8 SCC 517, National Insurance Co. Ltd. vs. Kaushalaya Devi & Ors., (2008) 8 SCC 246, National Insurance Co. Ltd. vs. Roshan Lal, [Order dated 19.1.2007 in SLP (C) No. 5699 of 2006], and National Insurance Co. Ltd. vs. Parvathneni & Anr. (2009) 8 SCC 785."

(Para-15)

9. Undoubtedly, the purpose and object of the Motor Vehicles Act, 1988, is beneficial, to accord compensatory benefit to the persons who either injured or died in a vehicular accident. It subserves a social beneficial purpose. Keeping in view this, and considering other attendant aspects of the case, the court deems appropriate to apply the 'pay and recover' doctrine.

8. In the case of Ashwinkumar P. Upadhyay (supra), this

Court has held in paragraphs no.10, 13, 14 and 15 as under:-

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

10. It appears that even in the cross examination of the claimants, the present appellant did not contend any reference to this aspect of the matter. No witnesses were examined by the present appellant before the Tribunal in connection with this issue. Primarily, it would be the duty of the insurance company to plead and prove a case of any breach of terms of the policy which would enable the insurance company to avoid its liability. This was precisely what was held by the Supreme Court in case of Fahim Ahmad & ors V/s. United India Insurance Company Limited & ors. AIR 2014 Supreme Court 2187 observed as under: -

"8. Although the plea of breach of the conditions of policy was raised before the Tribunal , yet neither any issue was framed nor any evidence led to prove the same. In our opinion, it was mandatory for respondent No.1 - Insurance Company not only to plead the said breach, but also substantiate the same by adducing positive evidence in respect of the same. In the absence of any such evidence, it cannot be presumed that - there was breach of the conditions of policy."

13. Hon'ble Madras High Court in CMA Nos.1529 to 1533 of 2015 in paras 48, 49 and 50 has observed as under: -

"48. Coming to the latest judgment viz., Shivraj Vs. Rajendra and another dated 05.09.2018, made in Civil Appeal Nos.8278 and 8279 of 2018, there again the Hon'ble Supreme Court affirmed the conclusion of the High Court to the effect that the insurance company was not liable for the loss or injuries suffered by the appellant or to indemnify the owner of the tractor.

However, the Hon'ble Supreme Court taking note of the peculiar circumstances of the case directed the insurance company to pay the compensation with liberty to recover the same. Unfortunately, the decisions of the larger bench in New India Assurance Company Vs. Asha Rani and others or National Insurance Company Ltd., Vs. Baljit Kaur and others were not brought to the notice of the tow Judge Bench which decided Shivraj Vs. Rajendra and another referred to supra.

49. We find that the judgments relied upon by the Hon'ble Supreme Court in Shivraj Vs.

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

Rajendra and another referred to supra in support of its conclusion that the insurance company can be directed to pay the compensation with liberty to recover the same even in respect of a gratuitous passenger or an unauthorized passenger in a goods vehicle, do not support the said conclusion.

50. In fact, we find that in none of the judgments referred to viz., National Insurance Co. Ltd. Vs. Swarn Singh & Ors. Reported in (2004) 3 SCC 297, Mangla Ram Vs. Oriental Insurance Co. Ltd. reported in (2018) 5 SCC 656, Rani & Ors. Vs. National Insurance Co. Ltd. & Ors. Reported in 2018 (9) Scale 310 and Manuara Khatun and Others Vs. Rajesh Kumar Singh and Others reported in (2017) 4 SCC 796, the question regarding the liability of the insurance company to pay the compensation in respect of an unauthorized passenger in the goods vehicle did arise for consideration. We are therefore of the considered opinion that the judgment of the two Judge bench in Shivraj Vs. Rajendra and another referred to supra cannot be taken as a precedent to conclude that the insurance company would be liable to pay the compensation even in respect of an unauthorized passenger, in a goods vehicle, in the light of categorical pronouncement of larger bench of the Hon'ble Supreme Court in New India Assurance Company Vs. Asha Rani and others and National Insurance Company Ltd., Vs. Baljit Kaur and others referred to supra.

Wetherefore conclude that the Tribunal, in the case on hand, was not right in directing the insurance company to pay the compensation and giving it the liberty to recover the same from the owner."

14. This Court, in First Appeal No.3431 of 2005 with First Appeal No.200 of 2008 in a similar facts of the case and issue, has taken a view that however the insurance company was not held liable to pay the amount of compensation to the claimants, it shall satisfy the award to the claimants and was permitted to recover the amount deposited by the insurance company from the owner of the motor vehicle with the interest awarded to the claimants and for such purpose, insurance company shall not have to institute any fresh proceedings.

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

15. Similar view was also taken by this Court in First Appeal No.1263 of 2011; First Appeal No.1392 of 2006; First Appeal No.1887 of 2007 with First Appeal No.2440 of 2007.

9. This Court, in First Appeal No.3431 of 2005 with First

Appeal No.200 of 2008 in a similar facts of the case and issue

has taken a view that however the insurance company was not

held liable to pay the amount of compensation to the claimants,

it shall satisfy the award to the claimants and was permitted to

recover the amount deposited by the insurance company from

the owner of the motor vehicle with the interest awarded to the

claimants and for such purpose, insurance company shall not

have to institute any fresh proceedings. Similar view was also

taken by this Court in First Appeal No.1263 of 2011, First Appeal

No.1392 of 2006, First Appeal No.1887 of 2007 with First Appeal

No.2440 of 2007.

10. While allowing the appeals directed the insurance company

to pay the awarded sum to the claimants and, thereafter,

permitted to recover the entire deposited sum from the owner /

insured of the offending vehicle in the very proceedings by filing

execution application against the insured.

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

11. Considering the facts of the present case, liability of the

present appellant can not be fastened by the Tribunal and

impugned judgment and award passed by the Tribunal would

require to be modified absolving the present appellant from

paying the amount of compensation to the claimants. However,

applying the ratio laid down by the Hon'ble Apex Court and this

Court, the present appellant - original opponent no.3 shall pay

the amount of compensation to the claimants and satisfy the

impugned award. However, the present appellant may recover

the amount deposited by it from the owner of the motor vehicle

with interest as awarded by the Tribunal from the date of deposit

till the same is received by the appellant. For such purpose, the

appellant would not needed to file any fresh proceedings.

12. In view of the above, I proceed to pass the following order.

(i)        The appeals are partly allowed.



(ii)       The impugned judgment and award dated 16.02.2008

passed by the Motor Accident Claims Tribunal (Aux.),

C/FA/5700/2008 JUDGMENT DATED: 22/12/2021

Vyara at Surat in M.A.C.P. Nos.401/2001 and allied claim

petitions holding the liability of the present appellant to

pay the amount of compensation to the claimants shall be

quashed and set aside with the aforesaid observations.

13. Record and proceedings be sent back to the concerned

Tribunal forthwith.

(HEMANT M. PRACHCHHAK,J) V.R. PANCHAL