Oriental Insurance Co Ltd vs Vipul R Brahmbhatt
2021 Latest Caselaw 14226 Guj

     C/FA/1650/2021                               ORDER DATED: 16/09/2021




           IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                      R/FIRST APPEAL NO. 1650 of 2021

                                 With
              CIVIL APPLICATION (FOR STAY) NO. 1 of 2021
                   In R/FIRST APPEAL NO. 1650 of 2021
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                       ORIENTAL INSURANCE CO LTD
                                  Versus
                          VIPUL R BRAHMBHATT
==========================================================
Appearance:
MR RATHIN P RAVAL(5013) for the Appellant(s) No. 1
NISHIT A BHALODI(9597) for the Defendant(s) No. 1
NOTICE SERVED(4) for the Defendant(s) No. 2,3
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 CORAM:HONOURABLE MR. JUSTICE A.G.URAIZEE

                              Date : 16/09/2021

                               ORAL ORDER

1. The present appeal under section 173 of the Motor Vehicles Act ("the MV Act" for short) is directed against the judgment and award dated 22.7.2020 passed by the learned Motor Accident Claims Tribunal (Aux.), Bharuch in Motor Accident Claim Petition No.673 of 2009.

2. Bereft of unnecessary details, short facts giving rise to the present appeal are that respondent No.1 along with his family members were going towards Somnath in Tata Sumo Car bearing No.GJ 16 AA 5670. The car was driven by respondent No.2 herein and it was of the ownership of respondent No.3 and insured with the appellant insurance company. The respondent No.2 was

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driving the car at very high and excessive speed so as to endanger human life. At about 6.00 pm, when the car was passing on Vanthli Junagadh Highway, respondent No.2 lost control over offending car resulting in dashed with the tree. The respondent No.1 and his family members suffered bodily injuries. The respondent No.1, therefore, filed Motor Accident Claims Petition No.673 of 2009 under section 166 of the MV Act against respondent Nos.2, 3 and the appellant to recover in the Motor Accident Claims Tribunal at Bharuch.

3. The respondents appeared through their learned advocates and contested the claim petition. The respondent Nos.1 and 2 contested the claim petition by filing written statement at Exh.72 wherein they have denied all the averments, statements and contentions raised in the claim petition. They also claimed that at the relevant time, respondent No.1 was going to Somnath along with the claimant who was relative of respondent No.3 - owner of the vehicle. It is also submitted in the reply that offending car dashed with the tree as one another Maruti car had applied sudden brakes and therefore, it was submitted that the claim petition may be dismissed.

4. The appellant contested the claim petition by filing the written statement at Exh.73 wherein the

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averments made in the claim petition are denied. It is also contended that offending vehicle was used for higher and reward though the vehicle was private vehicle. It was, thus, contended that there was violation of conditions of policy as contemplated under section 149(2) of the MV Act. Hence, the appellant insurance company may be exonerated.

5. The Tribunal has, by the impugned award, partly allowed the claim petition and has fastened liability of payment of compensation on the appellant insurance company and respondent Nos.2 and 3 jointly and severally. The insurance company has, therefore, approached this Court with this appeal.

6. By order dated 1.7.2021, the Notice for final disposal was issued since it was submitted that the appeal could be finally disposed of upon submission of higher and reward.

7. I have heard Mr.Rathin Raval, learned advocate for the appellant insurance company and Mr.Nishith Bhalodi, learned advocate for the claimant. The respondent Nos.2 and 3 though served have not appeared either in person or by duly instructed learned advocate.

C/FA/1650/2021 ORDER DATED: 16/09/2021

8. Mr.Raval submitted that offending vehicle was under the cover of insurance by virtue of private policy. It is his submission that however offending vehicle was used for commercial purpose which amounts to infraction of terms of the policy. He submits that learned Tribunal has failed to appreciate the fact that the original claimant cannot be relative of respondent No.3 - owner of offending vehicle because the claimant is NRI being resident of USA. Relying upon the FIR which was lodged by respondent No.2 - driver of the vehicle, he submits that it is very clearly stated therein that the claimant was travelling in offending vehicle as passenger. He further submits that respondent No.2 has approached the Consumer Disputes Redressal Forum to claim all damages compensation which was partly allowed. The insurance company has challenged the order of the Consumer Disputes Redressal Forum before the State Consumer Disputes Redressal Commission. While dismissing the appeal of the insurance company, the State Consumer Disputes Redressal Commission has recorded the finding that the insurance policy covering offending vehicle was private vehicle policy and it was used for ferrying passengers. He submits that this finding of the State Consumer Disputes Redressal Commission is not contested or challenged or disputed by respondent No.3 - owner of the vehicle and he has accepted non-standard basic claim. He, therefore, submits that the award of the learned Tribunal needs to be modified by exonerating the insurance company. He

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submits that liberty needs to be reserved in favour of the appellant insurance company to recover compensation from respondent No.2 after paying it to the claimant. He, therefore, submits that the appeal may be allowed accordingly. In support of his submissions, Mr.Raval has placed reliance on the decision of the Supreme Court in the case of Manuara Khatun and others Vs Rajesh Kumar Singh and others, reported in (2017) 4 SCC

796.

9. Mr.Nishith Bhalodi, learned advocate for the claimant has supported the impugned judgment and award. However, he submits that he has no objection if the award of the Tribunal is modified to the extent of liberty in favour of the appellant insurance company to pay and recover from the owner of the vehicle.

10. Solitary question that falls for consideration in this appeal is, whether the Tribunal has fallen in error in fastening liability of the payment of compensation on the appellant insurance company when there was evidence on record to show that offending vehicle in which the victim was travelling was transport vehicle which was covered under the private vehicle policy was being plied for commercial purpose ?

11. It emerges from the record that the appellant

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insurance company right from the beginning had raised the issue of infraction of terms of the policy. However, the Tribunal has, after referring to the evidence available on record, come to the conclusion in paragraph 15 as under.

"Issue No.2 :

The opponent No.3 has very categorically in his written statement contended that the vehicle in which claimant was travelling at the time of accident was hired by the claimants. So, there is breach of condition of policy and the opponent No.3 insurance company is not liable to indemnify the owner of the vehicle. In this regard, the opponent No.1 has not produced any oral as well as documentary evidence to show that the vehicle was hired by the claimant in which they were travelling. In this case, burden of proof lies on the opponent No.3 to prove his defence by producing an independent evidence that the said vehicle was hired by the claimants. Even in the cross examination, all the claimants have denied the fact. Even the opponent No.2 in his written statement denifed the fact that his vehicle was hired by the claimant."

12. It emerges from the record that the claimant had produced the copy of the FIR to prove factum of

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accident in which he has suffered bodily injuries. A perusal of the FIR which is lodged by respondent No.2 herein - driver of offending vehicle, it is categorically stated that on the day of accident, the claimant and others passengers were travelling in offending vehicle and were going towards Somnath for the purpose of paying obassion and in the accident, passengeres had suffered injuries. Thus, it is very clear that evidence in the form of FIR was very much there on record of the claim petition. However, ignoring this evidence, the Tribunal has recorded erroneous finding that the insurance company has not produced any evidence to show that offending vehicle was being used for commercial purpose in violation of the terms of the insurance policy.

13. As per the settled preposition of law, when a person is travelling as passenger in the vehicle insured under the private vehicle policy, he assumed the character of gratitious passenger. Under the circumstances, it amounts to breach of conditions of insurance policy. As a consequences, liability of payment of compensation cannot be mulcted on the insurance company. However, in view of the decision of Manuara Khatun and others (supra) relied upon by learned advocate for the appellant insurance company being insurer of the vehicle which was found involved in causing accident owing to negligence on the part of the driver is required to be satisfied the award in the first instance and

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thereafter can recover the same from the owner of the vehicle.

14. In view of the foregoing reasons, the appeal is partly allowed. The impugned judgment and award is modified to the extent that the appellant insurance company is exonerated from liability of making payment of compensation. However, the appellant insurance company is directed to pay awarded compensation to the claimant and thereafter recover the same from the owner of the vehicle in question.

15. In view of the above order, Civil Application does not survive and the same stands disposed of accordingly.

(A.G.URAIZEE, J) H.M. PATHAN