Gujarat High Court

Hdfc Ergo General Insurance Co Ltd vs Solanki Mohanbhai Shankarbhai on 5 August, 2024

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     C/FA/682/2020                                 ORDER DATED: 05/08/2024

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           IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

                     R/FIRST APPEAL NO. 682 of 2020

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               HDFC ERGO GENERAL INSURANCE CO LTD
                              Versus
               SOLANKI MOHANBHAI SHANKARBHAI & ORS.
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Appearance:
MR RATHIN P RAVAL(5013) for the Appellant(s) No. 1
MR PARTHIV A BHATT(5331) for the Defendant(s) No. 1
NOTICE SERVED for the Defendant(s) No. 2,3
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 CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT

                            Date : 05/08/2024

                             ORAL ORDER

1. The present appeal is filed by the appellant - Insurance

Company under Section 173 of the Motor Vehicles Act, being

aggrieved by and dissatisfied with the judgment and award

dated 30.10.2018 passed by the Motor Accident Claims

Tribunal (Aux.), Panchamahals at Halol in Motor Accident

Claim Petition No.2191 of 2017 (old MACP No.1138 of 2013),

by which, the Tribunal has partly allowed the claim petition

by awarding Rs.1,20,326/- with 9% p.a. interest to be paid to

claimant/s, by holding opponents liable, jointly and severally.

2. The facts of the present appeal are as under :

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2.1 The claimant filed the claim petition stating that

on 21.8.2013, the applicant and his sister Savitaben were

travelling in the said rickshaw no.GJ.17U.9789 which was

being driven by the opponent no.1 in rash and negligent

manner with excessive speed, at that time, santro car

no.GJ.20A.1346 came from Kalol side slowly and carefully and

the opponent no.1 dashed his rickshaw with the santro car

due to which the claimant and his sister sustained grievous

injuries. Therefore, he filed the claim petition for

compensation.

2.2 The notices were served to the opponents.

Opponent nos.1 and 2 have not contested the claim petition,

however, opponent no.3-insurance company filed the written

statement denying the averments made in the claim petition.

The issues were framed by the Tribunal. Oral as well as

documentary evidence were led before the Tribunal. After

hearing the submissions made by the rival parties, the

Tribunal has partly allowed the claim petition(s) and awarded

compensation as noted above.

2.3 Hence, the appellant-insurance company has filed the

present appeal before this Court.

3. Learned advocate for the appellant - Insurance

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Company has mainly submitted that the appellant-insurance

company had no liability to pay the compensation as there is

no fitness certificate and permit of the rickshaw and

therefore there is breach of terms and conditions of the

insurance policy. He submitted that though the insurance

company has examined legal officer vide Exh.37, the learned

Tribunal has erred in not considering the same. Further, he

submitted that even looking to Section 66 of the MV Act

which pertains to permits of motor vehicles, the learned

Tribunal has not properly appreciated the same and therefore

the appellant-insurance company should have been exonerated

from the liability to pay the compensation. He, therefore,

submitted that this appeal be allowed by modifying the

impugned judgment and award. He relied on the decision of

the Hon'ble Apex Court in the case of Amrit Paul Singh V/s

Tata AIG General Insurance Company Limited reported in 2018(7) SCC 558.

4. Per contra, learned advocate for the appellant has submitted that the impugned judgment and award is just and

proper and it is passed by the learned Tribunal after

considering the oral and documentary evidence led before the

learned Tribunal and therefore there is no need of any

interference by this Court. He, therefore, submitted to dismiss

this appeal.

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5. Though served, none appears for respondent nos.2

and 3-driver and owner of the rickshaw.

6. I have considered the submissions made by the

respective parties. I have perused the material produced on

the record. I have gone through the impugned judgment and

award passed by the Tribunal. I have also considered the

pleadings of the parties before the Tribunal.

7. The factum of accident is not disputed, the

involvement of two vehicles is not disputed, however, the

claimant has not joined the owner, driver and insurance

company of the santro car in the claim petition. The

negligence on the part of the driver of the rickshaw is

proved from the FIR, panchanama of scene of offence. The

driving licence of the opponent no.1 and the insurance policy

is produced on the record. On appreciating the said evidence,

the learned Tribunal has held the driver of the rickshaw

negligent for the accident. However, on the point of whether

the opponent no.3-insurance company is liable to pay the

compensation or not, the insurance company has raised the

defence in the written statement and also argued before the

learned Tribunal that the rickshaw was not having a valid

permit on the date of the accident. The affidavit of legal

manager of the insurance company is produced on record to

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substantiate the say of the insurance company that the

rickshaw was not holding a valid permit at the time of the

accident, wherein he deposes that the permit as required

under the law is not produced by the owner and it is not

sent to the insurance company and that on perusing the

record, the valid permit as on the date of the accident is not

produced on the record. Therefore, there is breach of the

provisions of the MV Act and the conditions of the policy

and thus the insurance company is not liable to pay the

compensation.

Section 66 of the MV Act reads as under:

"66. Necessity for permits.--(1) No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him the use of the vehicle in that place in the manner in which the vehicle is being used:

Provided that a stage carriage permit shall, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a contract carriage:

Provided further that a stage carriage permit may, subject

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to any conditions that may be specified in the permit, authorise the use of the vehicle as a goods carriage either when carrying passengers or not:

Provided also that a goods carriage permit shall, subject to any conditions that may be specified in the permit, authorise the use of the vehicle for the carriage of goods for or in connection with a trade or business carried on by him."

8. In the judgment relied on by the learned advocate

for the appellant in the case of Amrit Paul singh (supra), it

is held in paragraph 23 as under:

"23. In the case at hand, it is clearly demonstrable from the materials brought on record that the vehicle at the time of the accident did not have a permit. The appellants had taken the stand that the vehicle was not involved in the accident. That apart, they had not stated whether the vehicle had temporary permit or any other kind of permit. The exceptions that have been cared our under Section 66 of the Act, needless to emphasise, are to be pleaded and proved. The exceptions cannot be taken aid of in the course of an argument to seek absolution from liability. Use of a vehicle in a public place without a permit is a fundamental statutory infraction. We are disposed to think so in view of the series of exceptions carved out in Section 66. The said situations cannot be equated with absence of licence or a

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fake licence or a licence for different kind of vehicle, or, for that matter, violation of a condition of carrying more number of passengers. Therefore, the principles laid down in Swaran Singh (supra) and Lakhmi Chand (supra) in that regard would not be applicable to the case at hand. That apart, the insurer had taken the plea that the vehicle in question had no permit. It does not require the wisdom of the "Tripitaka", that the existence of a permit of any nature is a matter of documentary evidence. Nothing has been brought on record by the insured to prove that he had a permit of the vehicle. In such a situation, the onus cannot be case on the insurer. Therefore, the tribunal as well as the High Court had directed the insurer was required to pay the compensation amount to the claimants with interest with the stipulation that the insurer shall be entitled to recover the same from the owner and the driver. The said directions are in consonance with the principles stated in Swaran Singh (supra) and other cases pertaining to pay and recover principle."

9. The facts of the above referred case and the facts

of the case on hand are similar. If the affidavit placed on

record of the legal manager of the appellant along with the

contentions raised by the appellant along with the provisions

of law are considered together, it clearly comes on record

that the rickshaw was not holding a valid permit on the

date of the accident and therefore there is a clear-cut breach

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of the terms of the policy. When there is a breach of the

terms of the policy by the owner of the vehicle, the

insurance company cannot be held liable for payment of

compensation. However, as the manifest object of the

provisions of the MV Act is to ensure that the party, who

suffers injuries due to the use of the motor vehicle, and

may be able to get the damages for the injuries

sustained/death and the claimants cannot suffer for the

technicalities of whether the owner/insurance company should

pay the amount. Though the insurance company is not liable

to pay the amount and exonerated from the liability, as the

vehicle is insured with the insurance company, the insurance

company shall first pay the compensation and it is for the

insurance company to recover from the owner, if it so wishes.

10. A reference to the judgment in the case of

Shivaraj V/s Rajendra and another reported in 2018 ACJ

2755, the Hon'ble Apex Court has held in paragraph 10 as

under:

"10. At the same time, however, in the facts of the present case the High Court ought to have directed the insurance company to pay the compensation amount to the claimant(appellant) with liberty to recover the same from the tractor owner, in view of the consistent view taken in that regard by this court in National Insurance Co.Ltd. V.Swaran

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Singh, 2004 ACJ 1(SC); Mangla Ram v.Oriental Insurance Co.ltd., 2018 ACJ 1300(SC); Rani v.National Insurance Co.ltd., 2018 ACJ 2430(SC) and Manuara Khatun v.Rajesh Kumar Singh, 2017 ACJ 1031 (SC). In other words, the High Court should have partly allowed the appeal preferred by the respondent No.2, Appellant may, therefore, succeed in getting relief of direction to respondent No.2 insurance company to pay the compensation amount to the appellant with liberty to recover the same from the tractor owner (respondent No.1)."

11. In view of the above, the following order is

passed:

11.1 The present appeal is partly allowed to the extent

that the impugned judgment and award dated 30.10.2018

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

Panchamahals at Halol in Motor Accident Claim Petition

No.2191 of 2017 (old MACP No.1138 of 2013), is modified to

the extent that the claimants are entitled to get the

compensation from the opponent nos.1 and 2 only. The claim

petition is dismissed qua opponent no.3-insurance company.

However, as the vehicle is insured with the appellant-

insurance company and the insurance company is not held

liable to pay the amount, the insurance company shall first

pay the compensation and it is for the insurance company to

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recover from the insured, if it so wishes in view of the

judgment in the case of Oriental Insurance Co. Ltd. v.

Nanjappan [Oriental Insurance Co. Ltd. v. Nanjappan, (2004) 13 SCC 224.

11.2 Rest of the award remains as it is. Modified

decree be drawn accordingly.