Himachal Pradesh High Court

Officer (Legal) vs Rattani And Others on 27 August, 2021

Bench: Jyotsna Rewal Dua

IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA




                                                     .
              ON THE 27th DAY OF AUGUST 2021





                        BEFORE
        HON'BLE MS. JUSTICE JYOTSNA REWAL DUA





      FIRST APPEAL FROM ORDER No. 131 of 2021





       Between:-


       NATIONAL INSURANCE COMPANY LTD.
       THROUGH ITS ADMINISTRATIVE

       OFFICER (LEGAL),

       DIVISIONAL OFFICE,
       HIMALAND HOTEL, SHIMLA.    .....APPELLANT

       (BY SH. ASHWANI SHARMA, SENIOR ADVOCATE


       WITH MR. ISHAN SHARMA, ADVOCATE)


        AND




 1.    SH. MUKHTIAR KHAN





       SON OF SH. HABIBULLA KHAN

 2.    SMT. MASSARI





       WIFE OF SH. MUKHTIAR KHAN
       BOTH RESIDENTS OF
       VILLAGE HARAINGHPUR,
       P.O. MURA BUJURG,
       DISTRICT LAKHIMPUR KHIRI
       (UTTER PRADESH)

 3.    SH. HEMANT KUMAR
       SON OF SH. YASH PAL SHARMA
       (OWNER OF MAHINDRA PICK UP
       No. HP-17B-6788)

 4.    SH. YASH PAL SHARMA
       SON OF SH. JAGIRI PRASAD




                                    ::: Downloaded on - 31/01/2022 22:58:19 :::CIS
                                     2




           (DRIVER OF MAHINDRA PICK UP
           No. HP-17B-6788)
           BOTH RESIDENTS OF VILLAGE TOKIYON,




                                                            .
           P.O. SAINWALA,





           TEHSIL PAONTA SAHIB,
           DISTRICT SIRMOUR (H.P.)





                                          .....RESPONDENTS

           (SHRI VINOD CHAUHAN, ADVOCATE,
           FOR R-1 AND R-2
           SHRI HAMENDER CHANDEL,




           ADVOCATE, FOR R-3 & R-4)
           WHETHER APPROVED FOR REPORTING? Yes.
     ___________________________________________________________

               This appeal coming on for admission this day, the

    Court passed the following:

                          JUDGMENT

A sum of Rupees 3,39,000/- has been awarded in

favour of the claimants as compensation on account of death of

their son in a motor accident. The liability to pay the

compensation amount has been fastened upon the Insurance

Company. Aggrieved, the Insurance Company has preferred the

instant appeal.

2(i) Mathin Khan was son of respondents No. 1 and 2. On

29.9.2014 he was travelling in vehicle No. HP-17B-6788 from

Paonta Sahib to Majra, District Sirmour. The vehicle was being

driven by respondent No. 4. It met with an accident causing

Mathin Khan's death. His parents filed claim petition under

Section 166 of the Motor Vehicles Act for grant of compensation

of Rupees 8,00,000/-. The claimants stated that their son was

aged about 21 years at the time of accident. He was the sole

bread earner of the family, bringing home Rupees 12,000/- per

month from his labour/catering work etc. He was in the

employment of respondent No. 3-the owner of the ill fated

vehicle.

2(ii) The owner of the vehicle/respondent No. 3 submitted

in his reply that the deceased was employed by him for loading

and unloading of water campers, tent material and catering

articles from the vehicle in question. Deceased was travelling in

the vehicle in that capacity. The income of the deceased was

not more than Rupees 3,000/- per month. Though FIR No. 341

dated 29.9.2014 was registered at Police Station, Majra

regarding this accident against respondent No. 4 but the

accident was caused because of rash and negligent driving of a

truck coming from the opposite direction. Respondent No. 4 i.e.

the driver of HP-17B-6788 was not driving the vehicle in a rash

and negligent manner. This reply was jointly filed by the owner

and driver of the vehicle.

2(iii) The Insurer also resisted the claim petition. Its stand

was that the deceased was travelling in the goods carriage

vehicle as a gratuitous passenger. It was further pleaded that

the deceased was himself negligent as he was standing along

with 7-8 persons in the rear of the vehicle.

3. After considering the respective pleadings, evidence

and contentions of the parties, learned Tribunal held that the

accident occurred due to negligent driving of the vehicle by

respondent No. 4. The deceased was held to be travelling in the

vehicle as a labourer employed by respondent No. 3 for loading

and unloading and not as a gratuitous passenger. His age on

the date of accident was determined as 24 years. His income

was assessed at Rs. 3,000/- per month. The dependency of the

claimants was worked out at Rs. 1500/- per month. Keeping in

view the age of the deceased, multiplier of 18 was applied and

the totally dependency was worked out as Rs.

1500X12x18=3,24,000/-. An amount of Rs. 15000/- was

awarded to the claimants on account of funeral expenses. In all

the claimants were held entitled to a compensation of Rs.

3,39,000/- along with interest @9% per annum from the date of

filing of the petition till its realization.

4. Learned Senior Counsel for the appellant raised two

main contentions for assailing the award. Firstly, that the

deceased was travelling in the vehicle as a gratuitous

passenger. He was himself negligent as he was standing in the

rear portion of the goods carriage vehicle alongwith 7-8 persons,

therefore, Insurance Company is not liable to pay any

compensation. The second contention raised is that the

Insurance Policy for the vehicle in question does not cover the

risk of passengers travelling in the goods carriage vehicle.

Therefore, the appellant cannot be fastened with liability to pay

compensation on account of death of Mathin Khan.

                       r                                                       Learned

    counsel   for   the    respondents       supported       the      award.        They

submitted that deceased was travelling in the vehicle not as a

gratuitous passenger but as a labourer in employment of the

owner of the vehicle. The accident was caused due to rash and

negligent driving of the vehicle by respondent No. 4. I have

heard learned counsel for the parties and with their assistance

gone through the case record.

    4(i)         First contention.

    4(i)(a)      The claimants had pleaded that the deceased was

travelling in the vehicle in question as a labourer and earning

Rs. 12,000/- per month. Respondent No. 3 was his employer.

The vehicle in question was Mahindra & Mahindra bearing

registration No. HP-17B-6788 owned by respondent No. 3.

The owner and driver of the vehicle i.e. respondents

No. 3 and 4 filed a common reply and admitted that the

deceased was employed by the owner of the vehicle for the

purpose of loading and unloading of water campers, tent

material and catering articles from the vehicle. It was also

admitted that on 29.9.2014 the deceased was travelling in the

vehicle in that capacity. Their stand was that the income of the

deceased was not more than Rs. 3000/- per month. It was also

pleaded by them that the accident had not occurred on account

of negligence of respondent No. 4 but because of negligence of

driver of another vehicle coming from the opposite side.

4(i)(b) The Insurance Company in its reply took a stand that

the vehicle was carrying 7-8 passengers at the time of the

accident. This stand was taken only on the basis of the contents

of FIR No. 341 dated 29.9.2014. Learned Senior Counsel for the

appellant submits that the FIR Ext. PW1/C has been relied upon

by the claimants themselves, therefore, the contents of the FIR

have to be read and accepted in entirety. The FIR states that 7-

8 persons including the deceased were standing in the rear of

the goods carriage vehicle. This leads to an inference that the

accident occurred because of negligence on part of the

deceased himself. Mathin Khan died due to his own negligence.

Learned Senior Counsel for the appellant placed reliance upon

following para from (2009) 2 SCC 75, titled National

Insurance Company Limited versus Rattani and Others :-

"8. We are not oblivious of the fact that ordinarily

an allegation made in the first information would not be

admissible in evidence per se but as the allegation

made in the first information report had been made a

part of the claim petition, there is no doubt whatsoever

that the Tribunal and consequently the appellate courts

would be entitled to look into the same. However, in

their depositions, the claimants raised a new plea,

namely that the deceased and the other injured persons

were travelling in the said truck as representatives of

the owner of the goods."

4(i)(c) It is well settled that in motor accident claim cases,

once the foundational fact, namely, the actual occurrence of the

accident, has been established, then the Tribunal's role would be

to calculate the quantum of just compensation if the accident

had taken place by reason of negligence of the driver of a motor

vehicle and, while doing so, the Tribunal would not be strictly

bound by the pleadings of the parties. Notably, while deciding

cases arising out of motor vehicle accidents, the standard of

proof to be borne in mind must be of preponderance of

probability and not the strict standard of proof beyond all

reasonable doubts which is followed in criminal cases [Re:

(2020) 13 SCC 486, titled Sunita & Ors. Vs. Rajasthan

State Road Transport Corporation & Anr.]

In 2021 (1) SCC 171, titled Anita Sharma and

Others Vs. New India Assurance Company Limited and

Another, Hon'ble Supreme Court reiterated well established

principle that strict principles of evidence and standards of proof

like in a criminal trial are inapplicable in Motor accident claim

cases. The standard of proof in such like matters is one of pre-

ponderance of probabilities, rather than beyond reasonable

doubt. One needs to be mindful that the approach and role of

courts while examining evidence and material placed on record

in accident claim cases is to analyse to ascertain whether

claimant's version is more likely than not true. Relevant paras of

the judgment are extracted hereunder:-

"17. Unfortunately, the approach of the High Court was not sensitive enough to appreciate the turn of events at the spot, or the appellant claimants' hardship in tracing witnesses and collecting information for an accident which took place many hundreds of kilometers away in an altogether different State. Close to the facts of the case in hand, this Court in Parmeshwari v. Amir Chand, viewed that: (SCC p.638, para 12).

"12. The other ground on which the High Court dismissed the case was by way of disbelieving the testimony of Umed Singh, PW 1. Such

disbelief of the High Court is totally conjectural.

Umed Singh is not related to the appellant but

.

as a good citizen, Umed Singh extended his help

to the appellant by helping her to reach the doctor's chamber in order to ensure that an injured woman gets medical treatment. The

evidence of Umed Singh cannot be disbelieved just because he did not file a complaint himself. We are constrained to repeat our observation that the total approach of the High Court,

unfortunately, was not sensitised enough to appreciate the plight of the victim.

15. In a situation of this nature, the Tribunal

has rightly taken a holistic view of the matter. It

was necessary to be borne in mind that strict proof of an accident caused by a particular bus in a particular manner may not be possible to be

done by the claimants. The claimants were merely to establish their case on the touchstone of preponderance of probability. The standard of

proof beyond reasonable doubt could not have been applied."

(emphasis supplied)

22. A somewhat similar situation arose in Dulcina Fernandes v. Joaquim Xavier Cruz, (2013) 10 SCC 646, wherein this Court reiterated that: (SCC p.650, para 7) "7. It would hardly need a mention that the plea of negligence on the part of the first respondent who was driving the pickup van as set up by the claimants was required to be decided by the learned Tribunal on the touchstone of preponderance of probabilities and certainly not on the basis of proof beyond reasonable doubt. (Bimla Devi v. Himachal RTC" (2009) 13 SCC 530. "(emphasis supplied)"

4(i)(d) In the instant case, entire stand of the appellant with

respect to alleged negligence of the deceased in standing in the

rear of the vehicle is based upon contents of the FIR. The best

person to prove these specific averments in the FIR was the

complainant/informant-Ali Mohd. He has not been examined by

the Insurance Company. No suggestion has been given to PW1

Mukhtiyar Khan/claimant during his cross-examination on behalf

of the appellant that deceased was standing in the vehicle. PW1

has denied that 7-8 persons were travelling in the vehicle as

gratuitous passengers. There is no affirmative evidence on

record to prove that 7-8 persons including the deceased were

standing in the rear of the vehicle. In their joint reply filed to the

claim petition, the driver and the owner of the vehicle

(respondent No. 3) did not state that the deceased was standing

in the rear portion of the vehicle. The owner of vehicle though

admitted a suggestion given to him by the Insurance Company

about the deceased's standing in the vehicle, however, his

admission is of no significance as he was not present at the

spot. The driver of the vehicle did not step into the witness box.

There is also nothing to indicate who were the other 7-8 persons

alleged to be standing in the vehicle and what happened to

them in the accident. It is even otherwise the pleaded case of

respondent No. 4 that the accident was caused because of his

driving the vehicle to the extreme side of the road for avoiding a

collusion with an over speeding truck. The FIR has to read

conjointly with the statements of claimant, owner of the vehicle

and other evidence on record.

Therefore, the findings recorded by the learned

Tribunal that the accident had occurred because of rash and

negligent driving of the vehicle by respondent No. 4, are in

order. The finding of the learned Tribunal that the deceased was

travelling as a labourer in the goods carriage vehicle and that he

was employed by respondent No. 3 also do not call for any

interference. It is not only the case of claimants but also of the

owner of vehicle that the deceased was in employment of

respondent No. 3 (owner of vehicle) and that he was travelling in

the vehicle in that capacity as a labourer.

    4(ii)      Second contention.

    4(ii)(a)   Learned   Senior   Counsel    for    the     appellant         next

contended that insurance policy for the vehicle in question does

not cover the risk of gratuitous passenger travelling in the

vehicle. In support of such submission, learned Senior Counsel

placed reliance upon a judgment passed by a coordinate Bench

of this Court in FAO (MVA) No. 488 of 2012, decided on

24.9.2019, titled United India Insurance Company Ltd.

Versus Nirmla Devi and others. The contention of the

Insurance Company in that case was that if the vehicle was a

goods carriage vehicle and the deceased at the time of accident

was travelling in the rear open luggage space of vehicle then he

was travelling as an unauthorised gratuitous passenger. In such

circumstances, the liability cannot be fastened upon the

Insurance Company. The contention of the Insurance Company,

as noticed in the aforesaid judgment is as under:

"5. It is vehemently argued by Shri Ashwani K.

Sharma, Senior Advocate, assisted by Shri Ishan Sharma, Advocate, for the appellant that the vehicle in question was admittedly a goods carriage vehicle and

the deceased at the time of accident was admittedly travelling in the rear open luggage space of the vehicle

as is pleaded by the petitioner in her claim petition and since the deceased was travelling as an unauthorized gratuitous passenger, therefore, the liability could not

have been fastened upon the Insurance Company."

After considering plethora of precedents, it was held

by the Hon'ble Court as under:

"10. Admittedly, the offending vehicle in the instant case is Mahindra Jeep which is primarily a goods carriage vehicle and not meant for carrying passengers other than the one specified in the policy of the insurance. In the case of a gratuitous passenger, the Insurance Company is not liable to make any payment

of compensation as the same contravenes the terms of the policy."

It has already been observed earlier that in the case

in hand the deceased was travelling in the vehicle as a labourer

employed by respondent No. 3-the owner of the vehicle and

further that there is no evidence to suggest about his travelling

in the rear of the vehicle or that the accident occurred because

of his negligence. The accident was caused due to rash and

negligent driving of respondent No. 4. In fact it is the pleaded

case of respondent No. 4 that accident occurred because of his

driving the vehicle to the extreme side of the road to avoid a

collusion with an overspeeding truck.

4(ii)(b) In the instant case, the insurance policy has been

placed on record as Ex.RW1/B. As per this policy, premium

under Workmen's Compensation for two employees has been

charged by the insurer and paid by the Insured/respondent No.

3. It will be appropriate at this stage to refer to Section 147 of

the Motor Vehicle Act, which reads as under:

"147. Requirements of policies and limits of liability.

i) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-

a. is issued by a person who is an authorised insurer; and

b. insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)-

 Against any liability which may be incurred by him in respect of the death of or bodily injury to

.

any person or damage to any property of a third

party caused by or arising out of the use of the vehicle in a public place;

 Against the death of or bodily injury to any

passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place:

Provided that a policy shall not be required-

 to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury

sustained by such an employee arising out of and in the

course of his employment other than a liability arising under the Workmen's Compensation Act, 1923, (8 of 1923.) in respect of the death of, or bodily injury to, any such employee--

a. Engaged in driving the vehicle, or

b. If it is a public service vehicle engaged as a conductor of

the vehicle or in examining tickets on the vehicle, or

c. If it is a goods carriage, being carried in the vehicle, or

To cover any contractual liability.

Explanation.- For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place."

The proviso to Section 147 states that policy shall not

be required to cover liability in respect of the death, arising out

of and in the course of employment, of the employee of a

person insured by the policy or in respect of bodily injury

sustained by such an employee arising out of and in the course

of his employment other than a liability arising under the

Workmen's Compensation Act in respect of death of, or bodily

injury to any such employee.

In the instant case the appellant has contracted with

respondent No. 3 for covering the liability arising under the

Workmen's Compensation Act with respect to his two

employees. It will be appropriate at this stage to refer to

2009(3) Shim. LC 211, titled National Insurance Company

Ltd. versus Smt. Asha Devi and others. It was a case of a

labourer travelling in a goods carriage as an employee of the

owner of the vehicle. The Insurance Policy covered the risk

under Workmen Compensation. Following observations made in

the judgment are relevant in the context of present case:

"21. As far as the liability of the Insurance Company in the present case is concerned, the same is governed by the terms of the insurance policy which is Ext.R/1. The heading of the policy reads as follows:- "Goods carrying Commercial Vehicle (Open) Policy and

Liability only."

22. In the table of premium, basic third party premium of Rs.3580/- has been charged and WC for 6 employees amounting to Rs.150/- has been charged. WC obviously means workmen compensation. There is no other

premium which has been charged. This clearly shows that the policy in question covers only 'Act Liability'

.

under Section 147 of the Act. In respect of the

employees, the Insurance Company is only required to cover liability confined to the amount payable under the Workmen Compensation Act, 1993. Reference in this

regard may be made to the judgment of the Apex Court in National Insurance Co. Ltd. v. Prembai Patel and others 2005-06 (6) SCC 172 wherein the Apex Court held as follows:-

"12. The heading of Chapter XI of the Act is Insurance of Motor Vehicles Against Third Party Risks and it contains Sections 145 to 164. Section 146(1) of the Act provides that no person shall use,

except as a passenger, or cause or allow any other

person to use, a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with

the requirements of Chapter XI. Clause (b) of sub- section (1) of Section 147 provides that a policy of insurance must be a policy which insures the

person or classes of persons specified in the policy to the extent specified in sub-section (2) against

any liability which may be incurred by him in respect of death of or bodily injury to any person

or passenger or damage to any property of a third party caused by or arising out of the use of the vehicle in public place. Sub-clauses (i) and (ii) of clause (b) are comprehensive in the sense that they cover both 'any person' or 'passenger'. An employee of owner of the vehicle like a driver or a conductor may also come within the purview of the words 'any person' occurring in sub-clause (i). However, the proviso (i) to clause (b) of sub-

Section (1) of Section 147 says that a policy shall not be required to cover liability in respect of death, arising out of and in the course of his employment, of the employee of a person insured

by the policy or in respect of bodily injury sustained by such an employee arising out of and

.

in the course of his employment other than a

liability arising under the Workmen's Act if the employee is such as described in sub-clauses (a) or (b) or (c). The effect of this proviso is that if an

insurance policy covers the liability under the Workmen's Act in respect of death of or bodily injury to any such employee as is described in sub- clauses (a) or (b) or (c) of proviso (i) to Section

147(1)(b), it will be a valid policy and would comply with the requirements of Chapter XI of the Act. Section 149 of the Act imposes a duty upon the insurer (insurance company) to satisfy

judgments and awards against persons insured in

respect of third party risks. The expression "such liability as is required to be covered by a policy under clause (b) of sub-section (1) of section 147 (being a liability covered by the terms of the

policy)" occurring in sub-section (1) of Section 149 is important. It clearly shows that any such liability, which is mandatorily required to be

covered by a policy under clause (b) of Section 147(1), has to be satisfied by the insurance

company. The effect of this provision is that an insurance policy, which covers only the liability

arising under the Workmen's Act in respect of death of or bodily injury to any such employee as described in sub-clauses (a) or (b) or (c) to proviso

(i) to Section 147(1)(b) of the Act is perfectly valid and permissible under the Act. Therefore, where any such policy has been taken by the owner of the vehicle, the liability of the insurance company will be confined to that arising under the Workmen's Act.

13. The insurance policy being in the nature of a contract, it is permissible for an owner to take such a policy whereunder the entire liability in respect of the death of or bodily injury to any such

employee as is described in sub-clauses (a) or (b) or (c) of proviso (i) to Section 147(1)(b) may be

.

fastened upon the insurance company and

insurance company may become liable to satisfy the entire award. However, for this purpose the owner must take a policy of that particular kind for

which he may be required to pay additional premium and the policy must clearly show that the liability of the insurance company in case of death of or bodily injury to the aforesaid kind of

employees is not restricted to that provided under the Workmen's Act and is either more or unlimited depending upon the quantum of premium paid and the terms of the policy."

23. In view of the law laid down by the Apex Court, there can be no escape from the conclusion that the liability of the Insurance Company is limited to the amount payable under the Workmen Compensation Act.

In this case, the deceased was 27 years at the time of the accident. His income has been assessed at Rs. 3000/- per month and if the compensation is assessed in

consonance with the provisions of Section 4 of the Workmen Compensation Act, the amount payable by the

Insurance Company has to be calculated by multiplying 50% of the income by the relevant factor. 50% of the income of the deceased is Rs.1500/-. The relevant factor

by taking into consideration the age of the deceased is 213.57. Therefore, the compensation payable under the Workmen Compensation Act works out to Rs.3,20,355/."

Therefore, when a specific Policy has been taken by

respondent No. 3-owner of the vehicle, then the liability of the

Insurance Company will be confined to that arising under the

Workmen's Compensation Act in terms of the Policy. The award

passed by the learned Tribunal assessing the liability is,

therefore, not in consonance with the provisions of Policy.

Deceased was 24 years at the time of accident. His income has

been assessed at Rs. 3000/- per month. If compensation is

assessed in consonance with Section 4 and 4A of the Workmen's

Compensation Act, the payable compensation becomes:-50% of

Rs. 3000X218.47 (relevant factor)=Rs.3,27,705/-. Insurance

Company, therefore, is held liable to pay to the claimants a