Jharkhand High Court
National Insurance Company vs Janki Debi on 8 November, 2023
-1- M.A. No.315 of 2020
IN THE HIGH COURT OF JHARKHAND AT RANCHI
M.A. No.315 of 2020
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National Insurance Company, Divisional Office at Hindustan
Building, Main Road, Bistupur, P.O. & P.S. Bistupur, Jamshedpur,
District-East Singhbhum, through its Jharkhand Legal Cell, Kutchery
Road, P.O. Ranchi University, P.S. Kotwali, District Ranchi.
(having Policy No.55270031136300065809 having period of
Insurance from 29.09.13 to 28.09.140
.... .... Appellant(s)/O.P. No.4
Versus
1. Janki Debi, aged about 59 years, wife of Rajendra Sharma.
2. Rajendra Sharma, Aged about 64 years, son of Late Mathura
Sharma.
Both resident of Prem Nagar Road No.1 to 3, Telco, P.O. &
P.S.Telco, Jamshedpur, PIN-831004, District-East Singhbhum,
Jharkhand ... .... .... Respondents/Applicants
3. Birbal Saw, Son of Ram Balak Saw, Resident of At Juniyar, P.O. &
P.S. Hilsa, District-Nalanda, Bihar-803101
(Owner of Truck No.JH-02C-9205)
4. United India Insurance Company Limited, Divisional Office at
Near Ram Mandir, Main Road, Bistupur, P.O. & P.S. Bistupur,
Jamshedpur, District-East Singhbhum.
(Having Policy No.210406/31/13/01/00006596, having period of
insurance from 20.03.14 to 09.03.15
5. Anuj Kumar, Father's name not known to the appellant, Resident
of H. N.23, Village-Teliyamai, P.O. Nischal Ganj, P.S. Fatehpur,
Nalanda, District-Nalanda, Bihar PIN-801302
(owner of vehicle No.BR-21G-0963 Mini Bus)
... .... .... Respondents/Opp. Parties
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PRESENT
HON'BLE MR. JUSTICE PRADEEP KUMAR SRIVASTAVA
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For the Appellant : Mr. Manish Kumar, Advocate
For the Resp. No.1 & 2 : Mr. Vikash Kumar, Adv.
Mr. Sourav Kumar, Adv.
Mr. Parambir Singh, Adv.
For the Resp. No.4 : Mr. Debesh Chandra Ghosh, Adv.
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JUDGMENT
CAV On 19/09/2023 Pronounced On / 11 /2023
At the very outset it has to be mentioned that Respondent
Nos.3 & 5 have not turned up due to lack of their present and
correct address. Respondent Nos.1, 2 and 4 have appeared and
filed Vakalatnamas.
Heard learned counsel for the parties.
2. Present appeal has been preferred by the appellant under
Section 173 of Motor Vehicle Act, 1988 against the Award dated
-2- M.A. No.315 of 2020
04.03.2020 passed by Shri Onkar Nath Choudhary, District Judge-
III, cum MACT Jamshedpur, East Singhbhum in Motor Accident
Claim Case No.81 of 2017, whereby and whereunder the claim
case filed by the respondent Nos.1 and 2 (claimants) was allowed
and a sum of Rs.7,44,000/- along with an interest at the rate of 6
per cent per annum has been awarded as compensation.
The appellant-Insurance Company has been directed to pay
60 percent of the compensation out of total awarded amount i.e.
Rs.4,46,400/-.
The respondent No.4 United Insurance Company Limited
has been directed to pay 40 % of the total awarded amount i.e.,
Rs.2,97,600/- to the claimants.
The aforesaid apportionment of the awarded amount has
been made on account of ratio of negligent of the drivers of
offending vehicles involved in this case.
Factual matrix
3. The case of the claimants is that on 11.06.2014 at about 11:30
hours, Ram Nandan Sharma(now deceased) along with other
passengers were travelling in a Mini Bus bearing Reg. No.BR-21G-
0963 from Shekhpura to Sikandara. The driver of aforesaid Mini
Bus was driving the vehicle very rashly and negligently and in
spite of objection raised by the passengers against the rash and
negligent driving, the driver of the said bus did not stop the bus
and kept on driving at high speed and eventually the said Mini
Bus collided with a truck bearing Reg. No.JH-02C-9205 which was
also being driven by its driver very rashly and negligently at a
high speed near village Mahrat in front of Chimni Bhatta of Manoj
Singh, on Sikandara, Shekhpur, Main Road, as a result of which
sixteen passengers died who were travelling in the said Mini Bus
including the son of respondent Nos.1 and 2 (applicants) namely
Ram Nandan Sharma, who was aged about 26 years and he was a
permanent employee of Ganga Enterprises and was earning of
Rs.10,000/- per month. Accordingly, the claimants have claimed
Rs.23 lakhs as compensation.
4. In connection with above accident, FIR was registered
against unknown drivers of Mini Bus and truck bearing Reg. Nos.
-3- M.A. No.315 of 2020
BR-21G-0963 and against JH-02C-9205 respectively vide Halsi P.S.
Case No.69 of 2014 for the offences under Sections 279 and 304-A
of the Indian Penal Code. After completion of investigation,
charge-sheet was submitted against the driver of the truck namely
Raj Ballabh Yadav showing the driver of the mini bus Sanjit Ram
as dead in the said accident.
5. The appellant-insurance company filed its written statement
stating inter alia that the applicants should be directed to produce
road permit, driving license fitness certificate, registration,
documents etc. failing which it shall be presumed that there is
statutory violation of conditions of policy also. This insurance
company has admitted the existence of insurance policy
No.55270031136300065809 w.e.f 29.09.13 to 28.09.14 in respect of
mini bus bearing Reg. Nos. BR-21G-0963.
6. On the basis of pleadings of the parties following issues
were framed for adjudication:-
I. Whether this case is maintainable in present form or not
and whether the deceased died due to rash and negligent
driving of Vehicle Truck bearing registration No.JH-02C-
9205 or the rash and negligent driving of Mini Bus No.BR-
21G-0963 or there was any composite negligence of both the
drivers?
II. Whether both the offending vehicles were insured with
the OP No.2 United India Insurance Companies Limited
and O.P. No.4 National Insurance Company Limited
respectively and whether both OP Insurance Companies are
liable to make payment of compensation?
III. Whether owners of the offending vehicles have violated
any terms and conditions of the respective Insurance
Policies including requirement of valid driving license?
IV. Whether applicants are entitled to get compensation if
so what would be quantum of compensation?
V. Whether applicants are entitled to get any other relief or
reliefs?
-4- M.A. No.315 of 2020
SUBMISSIONS
7. Learned counsel for the appellant has assailed the
impugned judgment/award to the extent of decision on issue
No.3 by the learned Tribunal. It is submitted by learned counsel
for the appellant that the impugned award is perverse and not
based on materials on record the tribunal has failed to appreciate
that the applicants produces all valid vehicular documents of mini
bus but could not produce driving license of its driver and
permits which gave rise presumption that the driver of mini bus
did not possess driving license and it was being plied without
valid permit. The learned Tribunal has also failed to properly
appreciate the legal aspects regarding burden of proof of breach of
policy, which lies upon insured instead of insurer. It is also
argued that since the owner of mini bus did not appear despite
valid service of notice and in view of specific assertion made by
the appellant, the learned Tribunal ought to have presumed that
the driver of mini bus was not in possession of valid and effective
driving license and it was being plied without valid permit.
Accordingly, on the basis of principles of law propounded by the
Hon'ble Apex Court in case of National Insurance Company
Limited Vs. Swaran Singh & Anr. Reported in (2004) 3 SCC 297,
the appellant is liable to pay the awarded amount with right of
recovery from the insured due to violation of terms and
conditions of policy.
8. On the other hand learned counsel for the respondents have
opposed the aforesaid contentions raised on behalf of the
appellant and submitted that the learned Tribunal has very wisely
and aptly considered the issue No.3 and has recorded a well-
reasoned findings keeping in view the principles of law laid down
by Hon'ble Apex Court in this regard. It is settled law that there is
no presumption of violation of terms and conditions of policy
rather the insurance company has to prove the violations with
cogent and reliable evidence. As such there is no illegality or
infirmity in the impugned award as regards issue No.3 calling for
any interference in this appeal.
-5- M.A. No.315 of 2020
FINDINGS
9. The only point for determination in this appeal is that
whether the finding recorded by the learned tribunal on issue
No.3 is legally sustainable or not?
10. First of all, I have to discuss the finding recorded by the
learned tribunal on issue No.3 which is extracted as under:-
Whether the owner of the offending vehicles have violated
any terms and conditions of the respective insurance policies
including requirement of valid driving licenses.
Here, I find that neither O.P. No.2 United India Insurance
Company Limited the insurer of the offending truck bearing
registration no. JH-02C-9205 nor O.P. No.4 National Insurance
Company Limited the insurer of offending Mini Bus No. BR-21G-
0963 have either exhibited any documents or produced any
evidence to show that the owners of both the vehicles have
violated any terms and conditions of the insurance policies.
Although, O.P. No.2 in para 12 and in para 13 of its show cause
have taken the defense that the driver of the truck bearing
registration no. JH-02C-9205 was driving without license and the
truck was plying without any permit at the time of the accident.
Similarly, O.P. No.4 the insurer of the Mini Bus No. BR-21G-0963
in its show cause has stated in para 10, that the applicant may be
directed to produce route permit, driving license, fitness
certificate, registration documents etc. failing which it may be
presumed that the owner has violated the terms and conditions of
the policy as contemplated U/S 149(2) of M.V. Act, 1988 O.P. No.4
has also examined one witness namely Vishwajeet Mukherjee
administrative officer of National Insurance Company Limited as
O.P. witness No.1 who in para 3 of his testimony states that in the
present case applicant has not filed driving license and permit, so
National Insurance Company Limited is not liable to pay any
compensation to the applicants and the liability is of owner of the
vehicle. In the present case owner of both the vehicles i.e. O.P.
No.1 owner of the offending Truck and O.P. No.3 owner of the
Mini Bus No. BR-21G-0963 have not appeared and the case was
proceeded against them as ex parte. But the applicants have
-6- M.A. No.315 of 2020
produced photo copies of all documents of the offending truck
bearing registration no. JH-02C-9205 which was not controverted
by insurer of the Truck O.P. No.2. On the other hand applicants
have also produced all the documents of the Mini Bus No. BR-
21G-0963 except the driving license of the driver Sujeet Kumar,
who had also died in the said accident.
11. Now, the question arises whether the above documents are
sufficient to prove that there was no breach of terms and
conditions by the owners of the vehicle or whether failure of
applicants to file driving license of Sujeet Kumar the deceased
driver of the offending Mini Bus, absolves O.P. No.4 the insurer of
offending Mini Bus, from paying any compensation to the
applicants. In my opinion, it is the burden on the insurance
company to prove and not the burden of the applicants to prove
the fact that there was any breach of terms and conditions of the
contract of insurance arrived between the owner and the
insurance company. In the present case both the owners have not
appeared nor the breach of terms and conditions of the insurance
policy has been proved by any of the insurance companies i.e.
O.P. No.2 or by O.P. No.4. On this point, Hon'ble Apex Court
while deciding several issues has also decided the Issue regarding
burden to prove the breach of terms and conditions of the
insurance policy. In National Insurance Company Limited Vs.
Swaran Singh & Anr. Reported as (2004) 3 SCC 297. Hon'ble
Court in the above said judgment in para 110 has summarized all
the issues decided by it in the said judgment. In para 110(iii) & (iv)
it has been held that the breach of policy condition e.g
disqualification of the driver or invalid driving license of the
driver, as contained in sub-section (2)(a)(ii) of Section 149, has to
be proved to have been committed by the insured for avoiding
liability by the insurer. Mere absence, fake or in valid driving
license or disqualification of the driver of driving at the relevant
time, are not in themselves defenses available to the insurer
against either the insured or the third parties. To avoid its liability
towards the insured, the insurer has to prove that the insured was
-7- M.A. No.315 of 2020
guilty of negligence and failed to exercise reasonable care in the
matter of fulfilling the condition of the policy regarding use of
vehicles by a duly licensed driver or one who was not disqualified
to drive at the relevant time.
Insurance companies, however, with a view to avoid
their liability must not only establish the available defence(s)
raised in the said proceedings but must also establish "breach" on
the part of the owner of the vehicle; the burden proof where for
would be on them.
"In view of above discussions as well as the ratio of
Swaran Singh's case (supra) I find that none of the insurance
company have discharged their burden to proof the breach of
terms and conditions of insurance policy on the part of the owner
of the vehicles, therefore, both the insurance companies Nos.2 and
4 are liable to pay the compensation to the applicants in ratio
already been decided while deciding the Issue No. II, because
there was no violation of any terms and conditions of the contract
of Insurance."
12. In the case of United India Insurance Company
Limited v. Rakesh Kumar Arora, (2008) 13 SCC 298, it was held
that "in order to bring the case within the mischief of 'breach' it
has to be proved that there was a willful default on the part of the
insured"
Therefore, it is settled law that the insurance company is
required to prove the breach of the terms and conditions of the
insurance policy by cogent evidence. In the event, the insurance
company fails to prove that, there has been breach of conditions of
the policy on the part of the insured, the insurance company
cannot be absolved of its liability.
13. In the instant case, the driver of mini bus himself died in the
said accident. The case has been set ex parte against the owners of
the vehicle before the Motor Vehicle Accident Claim Tribunal.
Admittedly, no materials have been brought on record by the
appellant-insurance company that the offending vehicle was
being driven by any unauthorized person or the person driving
-8- M.A. No.315 of 2020
the vehicle did not have valid driving license. It is also apparent
that the insurance company has issued no notice against the
insured to produce the driving license of the deceased driver or
permit under the provision of Indian Evidence Act, in order to
raise a presumption under Section 114 illustration (g) of the
Indian Evidence Act against the insured.
14. In view of the aforesaid discussion and reasons, I do not
find any irregularity and infirmity in the finding recorded by
learned Tribunal on issue no.3 denying right of recovery to the
appellant of the awarded amount from the insured. Accordingly, I
do not find any merit in this appeal, which stands dismissed.
15. I.A. No.2814 of 2021 filed on behalf of the appellants for stay
of further proceeding in Execution Case No.14 of 2020 stands
disposed off.
16. Further, I.A. No.7992 of 2023 has been filed on behalf of the
respondent Nos.1 and 2 for release of awarded amount of
Rs.5,40,386/- in their favour which was deposited by the
appellant-Insurance Company through challan vide Challan No.
J-92 dated 28.02.2022 before the Registrar General of this Court on
28.02.2022 in compliance of the order dated 07.09.2021 passed in
this case.
17. The Registrar General of this Court is directed to release the
awarded amount of Rs.5,40,386/- as deposited in compliance of
the order dated 07.09.2021 along with accumulated interest in
favour of the respondent Nos.1 and 2 after proper identification of
them.
18. Accordingly, I.A. No.7992 of 2023 is allowed.
(Pradeep Kumar Srivastava, J.)
Pappu-N.A.F.R./-
