United India Insurance Company ... vs Sureshbhai Raymalbhai Halvadiya
2022 Latest Caselaw 2781 Guj

     C/FA/2964/2013                               CAV JUDGMENT DATED: 11/03/2022




               IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                      R/FIRST APPEAL NO. 2964 of 2013


FOR APPROVAL AND SIGNATURE:


HONOURABLE MR. JUSTICE SANDEEP N. BHATT

==========================================================

1 Whether Reporters of Local Papers may be allowed to see the judgment ?

2      To be referred to the Reporter or not ?

3      Whether their Lordships wish to see the fair copy
       of the judgment ?

4      Whether this case involves a substantial question

of law as to the interpretation of the Constitution of India or any order made thereunder ?

========================================================== UNITED INDIA INSURANCE COMPANY LIMITED Versus SURESHBHAI RAYMALBHAI HALVADIYA & 1 other(s) ========================================================== Appearance:

MR VIBHUTI NANAVATI(513) for the Appellant(s) No. 1 RULE SERVED for the Defendant(s) No. 1,2 ==========================================================

CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT

Date : 11/03/2022

CAV JUDGMENT

1. The present First Appeal, under Section 173 of Motor Vehicles Act, 1988, is preferred by appellant - insurance company, being aggrieved and dissatisfied with the judgment and award dated 14.06.2013 passed by the Motor Accident Claims Tribunal (Main), Rajkot in Motor Accident Claim Petition No.165 of 2002, by which

C/FA/2964/2013 CAV JUDGMENT DATED: 11/03/2022

the Tribunal has awarded Rs.1,94,000/- with 8% per annum interest to the claimants, by holding Opponents No.1 and 2 i.e. owner and insurance company, jointly and severally.

2. Brief facts of the case are as under :

2.1 On 10.12.2001 at about 7:00 a.m., when he was travelling in the rickshaw bearing registration No.GJ-3-V-3687, at that time, the said rickshaw overturned and therefore, the claimant got injuries. He was shifted to the hospital. He lodged the complaint before the concerned police station. The complainant was aged about 20 years old at the time of accident and was doing the business of old gunny bags and earning Rs.2,800/- per month. Therefore, he has filed a claim petition before the Tribunal for compensation.

2.2 Notices were served to the opponents i.e. owner and insurance company of the rickshaw. The insurance company has filed its written statement at Exh.14 and denied the facts of the incident and raised several contentions. The Tribunal has framed the issues at Exh.23. The oral as well as documentary evidence were led before the Tribunal by the respective parties. After considering the submissions made by the rival parties, the Tribunal has passed the impugned award, as noted above.

2.3 Hence, the present appeal by the insurance company before this Court.

3. Learned advocate Mr. Vibhuti Nanavati for the appellant - Insurance Company has submitted that the present claim petition is allowed by the learned Tribunal by awarding compensation of Rs.1,94,000/- with 8% p.a. interest by ignoring the fact that the

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insurance company is not liable to pay the amount as there is clear breach of terms and conditions of the insurance policy on the part of the owner of the vehicle. He has submitted that in the present case, the passengers travelling in the goods vehicle are not contemplated under the Motor Vehicles Act as the Insurance Company is not liable to pay the compensation in the case of unauthorized passengers travelling in the goods vehicle. He has also pointed out the discussion about the 'Act only Policy' from the impugned judgment of the Tribunal. He has submitted that the claimant cannot be termed to be a third party when the 'Act only Policy' is there. He has also pointed from the RC Book about the sitting capacity in the vehicle which, as per the RC Book, is only one person. Therefore, he has submitted that even though the goods of claimant can be considered on the basis that the claimants are travelling as passenger along with goods as per the FIR and averments made in the claim petition, even then, in view of the fact that the present policy is 'Act only Policy' and no additional premium is paid towards additional risk of any person other than the person who is authorised to drive the vehicle. He has pointed out from the RC Book (Exh.30) that the sitting capacity column including driver is mentioned as '1' and therefore, risk of the other persons cannot be covered by the insurance policy. He has pointed out from the insurance policy, Exh.37, that the policy also indicates that 'A' policy (Act only) and the premium is paid Rs.464/- only. Therefore, he has submitted that the insurance company cannot be fastened with the liability and the Tribunal has erred by holding insurance company liable by saying that the claimant can be considered as third party and therefore, the insurance company is liable to pay the amount of compensation. He has relied upon the decision of this Court in the case of Dilipsinh Bhaisaheb Jhala versus Juma Ali Sumra reported in 2015 (0) AIJEL-HC 234864 in support of his submissions. He has submitted

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that in view of the decision, the claim petition of the claimant can be allowed by exonerating the insurance company from its liability. He has also relied on the decision of Hon'ble Apex Court in the case of New India Assurance Co. Ltd., versus Asha Rani reported in (2003) 2 SCC 223 in support of his submissions. He has further submitted that the insurance company will not insist for any recovery of the amount which is paid to the claimant if the appeal will be allowed, but rest of the amount which is lying with the Tribunal may be paid back to the insurance company. He has also submitted that this appeal may be allowed.

4. Though the claimant(s) and owner are served in the present appeal, they have chosen not to appear and contest this appeal before this Court.

5. I have heard learned advocate for the appellant. I have considered the impugned judgment and award passed by the Tribunal. I have perused the record and proceedings of the Tribunal. I have also considered the decisions cited at the bar by the appellant and I have come across the judgment which is recent one rendered in First Appeal No.1120 of 2010 dated 16.02.2022 by the Division Bench of our High Court in the case of Oriental Insurance Company Limited versus Jamnaben Parsottambhai Patel. While considering the record and proceedings, it clearly transpires that the policy issued by the insurance company is 'Act only Policy' and no additional premium is paid by the claimant. The insurance company cannot be held liable by resorting to the provisions of Section 147(1)

(b) of the Motor Vehicles Act, 1988 in the facts and circumstances of the present case. Though it is undisputed that the claimant is travelling as owner of the goods in the goods vehicle and as per the

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RC Book, the sitting capacity in the vehicle is shown including the driver is '1' and therefore, only driver can go in the said vehicle. In the peculiar circumstances of the present case, it clearly transpires that breach of terms and conditions of the insurance policy is committed and therefore, the insurance company cannot be held liable to pay the amount of compensation to the claimant who is travelling in the vehicle along with the goods. Therefore, the present appeal is required to be allowed as the insurance company succeeds in factually establishing its case about the breach of conditions of the insurance policy and more particularly, when the 'Act only Policy' is issued by the insurance company. Therefore, in view of above decision of our High Court as noted above, I found that the present appeal deserves to be allowed in peculiar facts and circumstances of the present case.

6. For the reasons recorded above, the following order is passed.

6.1       The present appeal is partly allowed.


6.2       The impugned the judgment and award dated 14.06.2013

passed by the Motor Accident Claims Tribunal (Main), Rajkot in Motor Accident Claim Petition No.165 of 2002 is hereby set aside qua the insurance company by exonerating from the liability to pay the amount of compensation to the claimants and hence, the judgment and award id modified by holding liability of rest of the tort-feasors to pay the compensation.

6.3 However, it is clarified that, whichever amount is paid to the claimant from the awarded amount, along with interest, shall not be recovered from the claimant by the insurance company, as agreed by the insurance company.

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6.4 Rest of the amount deposited with the Tribunal and/or lying in the FDR shall be refunded back, with accrued interest thereon if any, to the insurance company by the Tribunal.

6.5 Record and proceedings be sent back to the concerned Tribunal, forthwith.

(SANDEEP N. BHATT,J) M.H. DAVE