Shriram General Insurance Co Ltd vs Narayanbhai Khemabhai Parmar
2023 Latest Caselaw 3224 Guj

     C/FA/3844/2022                                JUDGMENT DATED: 25/04/2023




             IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                      R/FIRST APPEAL NO. 3844 of 2022
                                   With
                CIVIL APPLICATION (FOR STAY) NO. 1 of 2019
                     In R/FIRST APPEAL NO. 3844 of 2022

FOR APPROVAL AND SIGNATURE:


HONOURABLE MS. JUSTICE GITA GOPI

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

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 ?

==========================================================
                      SHRIRAM GENERAL INSURANCE CO LTD
                                   Versus
                       NARAYANBHAI KHEMABHAI PARMAR
==========================================================
Appearance:
MR RATHIN P RAVAL(5013) for the Appellant(s) No. 1
for the Defendant(s) No. 3,4,5
MR VAIBHAV N SHETH(5337) for the Defendant(s) No. 1,2
==========================================================

    CORAM:HONOURABLE MS. JUSTICE GITA GOPI

                               Date : 25/04/2023

                              ORAL JUDGMENT

1. Shriram General Insurance Company Ltd.

challenges the judgment and award dated

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

5.10.2018 passed by the MACT, Sabarkantha at

Idar in MACP no.300/11.

2. The owner of tractor no.GJ-9 AF-1552 has

been made party respondent no.4 and when the

notice of R/Civil Application (for

condonation of delay) no.4117/19 was

processed to be served, it had come on

record that respondent no.4 had expired and

the bailiff report along with the copy of

the death certificate showed the date of

death of respondent no.4 on 19.4.2015.

3. Learned advocate Mr. R.P. Raval, placing

reliance on the bailiff report supported by

the copy of the death certificate, submitted

that the judgment and award would be a

nullity since it was against the dead person

as respondent no.2, the owner of the

tractor-Kanabhai Kuberbhai Parmar had died

even prior to the judgment. Mr. Raval has

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

referred to the judgments in the cases of

Iffco Tokio General Insurance Company Ltd.

v. Nirmalaben Ghanshyambhai Sen rendered in

First Appeal no.4485/18, Narsinhbhai

Manjibhai Chhabhaiya v. Kasam Ishabhai

Kumbhar rendered in F/First Appeal

no.32469/18, United India Insurance Company

Ltd v. Mohanlal Nandiram & Ors., rendered in

Letters Patent Appeal no.309/84, Oriental

Insurance Company Ltd. v. Hansaben

Khumansinh Padhiyar, rendered in First

Appeal no.4469/06, New India Assurance

Company Ltd. v. Sitaben wd/o Ratanabhai

Devabhai Rabari, rendered in Civil

Application no.13526/13 in F/First Appeal

no.3446/12, to submit that the award is a

nullity since the heirs of the owner were

not brought on record after his death.

4. Countering the arguments, Advocate Mr.

Vaibhav Sheth submitted that the judgments

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

referred to by Advocate Mr. Raval cannot be

made applicable to the present matter since

they are not decisions under Section 155 of

the Motor Vehicles Act, 1988 (hereinafter

referred to as "the Act"). Advocate Mr.

Sheth submitted that referred judgments do

not deal with the provisions on Section 155

of the Act, which firmly clarify that the

death of the person in whose favour a

certificate of insurance has been issued, if

it occurs after the happening of an event

which has given rise to the claim, shall not

be a bar to the proceedings and therefore,

the proceedings do not abate. Mr. Sheth

contended that happening of the event, in

this case the death in a vehicular accident

is the cause, which has given rise to the

claim under the Act and death of the owner

of vehicle after such cause, would not bar

survival of the cause of action and in such

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

an event, the proceedings could be against

the estate or against the insurer and thus,

submitted that objection raised by the

learned advocate for the insurance Company

would not survive in view of provision of

Section 155 of the Act.

5. Mr. Sheth has made reference to the

judgments in the cases of IFFCO TOKIO

General Insurance Company Ltd v. Om Parkash,

passed by the Jammu and Kashmir High Court

in Mac App no.57/21 and allied matters,

Shivshankara & Anr. v. H.P. Vedavyasa Char,

2023 (5) Scale 218. Advocate Mr. Sheth has

submitted that the issue was decided by this

Court in the case of Madhuben Maheshbhai

Patel v. Joseph Francis Mewan, passed by

this Court in First Appeal no.1528 of 2009,

to bear the pure question of law fell for

consideration before the Single Judge. The

question so formulated was whether the

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

Tribunal below was justified in passing an

award after substituting the heirs and legal

representatives of the deceased claimant who

died during the pendency of the claim

petition in violation of Section 306 of the

Indian Succession Act, wherein Mr. Sheth

stated that the provisions of Sections 144,

155 and 169 of the Act were referred along

with Section 306 of the Indian Succession

Act and mention was also made to Order 22

Rule 1 of the CPC and Rule 229 of Gujarat

Motor Vehicle Rules, 1989. Mr. Sheth stated

that Section 155 of the Act was referred by

observing that it limits the applicability

of Section 306 of the Indian Succession Act

only to the case of the death of a person in

whose favour the certificate of insurance

has been issued, where the death occurs

after happening of the event, which has

given rise to the claim under the provisions

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

of Chapter X or XII of the Act and in such a

case, the death of the insured shall not be

a bar to the survival of the cause of action

arising out of the said event against the

estate of said person or consequently

against the insurer. Mr. Sheth thus stated

that the very provision would be applicable

in the present matter and that the death was

subsequent to the cause of action for the

claim petition, which had arisen owing to

the death in a vehicular accident. Mr. Sheth

submitted that the cause would survive and

the proceedings could be against the estate

of the insured or against the insurer.

6. The judgment in the case of Madhuben Mahesh

Patel (supra) was referred to the Division

Bench and in the judgment dated 14.11.2014,

the view referred was answered on the fact

that even after the death of the injured

claimant, the claim petition does not abate

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

and right to sue survives to the heirs and

legal representatives insofar as loss to the

estate is concerned, which includes personal

expenses incurred on treatment and other

claim related to the loss to estate and

thereafter, was referred back and on

15.12.2015, an appeal came to be allowed.

7. The referred judgment is in context with the

survival of the cause of action on the death

of the injured claimant. While here in this

case, the death of the owner of the vehicle

came to be known only at the appellate

stage, where the service for the application

for the delay condonation was processed to

be made by the bailiff and the bailiff

report supported by the copy of the death

certificate, disclosed death of owner of the

vehicle as on 19.4.2015. MACP no.300/11 was

registered on 6.4.2011, while decided on

5.10.2018. The cause of action for the claim

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

arose on the death because of the vehicular

accident dated 11.12.2010. Thus, the cause

for the claim petition arose on 11.12.2010.

Section 155 of the Act is reproduced

hereunder:-

"155. Effect of death on certain causes of action.-- Notwithstanding anything contained in section 306 of the Indian Succession Act, 1925 (39 of 1925), the death of a person in whose favour a certificate of insurance had been issued, if it occurs after the happening of an event which has given rise to a claim under the provisions of this Chapter, shall not be a bar to the survival of any cause of action arising out of the said event against his estate or against the insurer."

8. Section 155 of the Act is the provision for

the consequences to the effect of death on

certain causes of action. A bare perusal of

the provision clarifies that despite

anything in Section 306 of the Indian

Succession Act, 1925, if the death of the

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

person in whose favour certificate of

insurance has been issued occurs after

happening of the event which gives rise to

the claim, it shall not be a bar to the

survival of any cause of action arising out

of such event and accordingly, the

proceedings could be continued against the

estate of the deceased or against the

insurer. The question thus would arise for

consideration as to whether the judgment and

award, which has been passed without

impleading the heirs of the owner of the

vehicle would be maintainable.

9. In a case before the Division Bench of

Karnataka High Court in the case of New

India Assurance Company Ltd. v. H.

Siddalinga Naika & Ors., 1985 ACJ 1989, an

issue had been raised, where the insurance

Company contended that since the owner of

the vehicle had died during pendency of the

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

claim petition before the Tribunal and as

legal heirs were not brought on record, the

Tribunal could not have passed the award

against the insurance Company. The Division

Bench, having rejected the contention, had

observed as under:-

"There is no substance in the contention so raised because section 102, Motor Vehicles Act, states:

           "Notwithstanding            anything
           contained    in     section     306,

Succession Act, 1925, the death of person in whose favour a certificate of insurance had been issued, if it occurs after the happening of an event which has given rise to a claim under the provisions of this Chapter, shall not be a bar to the survival of any cause of action arising out of the said event against his estate or against the insurer."

In this case, the claim petition was already filed before the Tribunal and insurance company had issued the policy. That being so, the fact that the owner of the lorry dies, makes no difference.

The Tribunal has rightly passed award against the insurer. Hence, there is no substance in this

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

appeal and it is liable to be dismissed. Accordingly it is dismissed. No costs in the appeal"

10. A similar issue was raised before the Punjab

and Haryana High Court in the case of Natha

Singh v. Gurdial Singh & Ors., AIR 1982

Punjab and Haryana 38, where the objection

was raised by the insurance Company that it

was not liable to satisfy the claim for the

compensation because the legal

representative of the insured who died

during pendency of the proceedings were not

brought on record. Punjab and Haryana High

Court, while rejecting the objection so

raised, has observed as under:-

"Section 96 of the Act provides for the duty of the insured to satisfy judgments against persons insured in respect of third party risks. It also provides that the insurance company or the insurer to whom the notice of the bringing of any such proceedings is given, shall be entitled to be made a

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

party thereto and to defend the action on any of the grounds given therein. Section 102 of the Act provides,-

"Notwithstanding anything contained in Section 306 of the Indian Succession Act, 1925 (XXXIX of 1925), the death of a person in whose favour a certificate of insurance had been issued, if it occurs after the happening of an event which has given rise to a claim under the provisions of this Chapter, shall not be a bar to the survival of any cause of action arising out of the said event against his estate or against the insurer." In view of these provisions of the Act, it cannot be said that the insurance company is not liable to satisfy the claim for compensation to be awarded in the claim application simply because the legal representatives of Amrit Lal Gupta insured who died during the pendency of the proceedings, were not brought on the record. It is particularly so because in the insurance policy, Exhibit R-11, it has been provided inter alia vide Cl. (4) of Section II, thereof that the company may, on its own option, undertake the defence of proceedings in any Court of law in respect of any act or alleged offence causing or relating to any event which may be the subject of indemnity under that section. It was because of

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

this term of the policy that the insurance company took a specific plea in paragraph 3 of their additional grounds that it had taken over the defence of the claim petition in the name of the insured to contest the claim, as they had reserved the right under the policy of insurance. As observed earlier, this claim was accepted by the Tribunal and on that account, it was allowed to cross-examine the witnesses, on merits, as well. Under the circumstances, the ratio of the decision in Norati Devi's case, (AIR 1978 Punj. & Har 113) (supra), is most relevant. It has been held therein (at p. 114):-

"Section 96 only clarifies that if an award is made, it would be the duty of the insurance company to meet the claim. It nowhere lays down that if the insurance company is allowed to contest the liability in the absence of the insured, it should not be held liable. Therefore, it cannot be contended that an insurance company can never be held liable so long as the insured is not impleaded as a party to the proceedings, or having been impleaded his name is ordered to be struck off from the array of the respondents on the basis that he enjoys diplomatic immunity from being sued in a Court."

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

In view of the abovesaid decision of this Court, the claim application of Natha Singh, appellant, could not be dismissed on the ground that the legal representatives of Amrit Lal Gupta, deceased, were not brought on the record."

11. In the same way, the Court at Jammu &

Kashmir and Ladakh at Jammu in the case of

Bajaj Allianz General insurance Company Ltd.

Vs. Naresh Kumar & Anr. (MA no.18/2016,

decided on 25.10.2021), has observed that

Section 155 of the Act clearly states that

the death of a person in whose favour a

certificate of insurance has been issued,

after the happening of the accident which

gave rise to filing of claim petition is no

bar to the proceedings and therefore, the

proceedings do not abate.

12. The law is very clear by way of provision

under Section 155 of the Act, which makes it

explicit that on the death of the insured

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

after the cause of action for filing the

claim petition, the claim petition cannot be

thrown out merely because legal heirs of the

insured have not been impleaded as party to

the claim petition. Here in this case, the

death of the insured has taken place only

after occurrence of the accident and not

prior and at the time of the accident, the

certificate of insurance had been issued by

the appellant-insurance Company in favour of

the deceased owner, which was in force.

Hence, the claim petition would be saved in

view of provision of Section 155 of the Act

as the claimant can proceed even against the

estate of the insured or can further proceed

against the insurer. Thus, in view of the

reasons given hereinabove, non-impleadment

of the legal heirs of the deceased owner

would not have any adverse effect on the

merits of the case and the insurer cannot

C/FA/3844/2022 JUDGMENT DATED: 25/04/2023

escape the liability to pay the compensation

to the claimant on the ground that the legal

heirs of the deceased were not made parties

to the claim petition. Hence, even in

absence of the owner of the vehicle or the

heirs and legal representatives of the

deceased owner of the vehicle, the claim

petition could proceed against the estate of

the insured owner of the vehicle and even

against the insurer. Thus, objection so

raised by the learned advocate for the

insurance Company stands rejected.

13. Accordingly, the present appeal stands

disposed of. Since the appeal is disposed

of, Civil Application would not survive and

is disposed of accordingly.

(GITA GOPI,J) Maulik