Karnataka High Court
M R Basavanthappa vs Smt. Mallamma on 23 February, 2024
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MFA No. 10430 of 2012
R
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 23RD DAY OF FEBRUARY, 2024
BEFORE
THE HON'BLE MR JUSTICE C.M. POONACHA
MISCELLANEOUS FIRST APPEAL NO.10430 OF 2012(MV-D)
BETWEEN: ;
M.R BASAVANTHAPPA
S/O LATE RUDRAPPA
AGED ABOUT 62 YEARS
OPPOSITE OLD BUS STAND
P.B ROAD,
KRISHNA ENGINEERING WORKS COMPLEX
DAVANAGERE
SINCE DECEASED BY LR'S
1. M.B.SIDDESH,
S/O LATE M.R BASAVANTHAPPA
AGED ABOUT 53 YEARS
2. M.B.SHIVAKUMAR,
S/O LATE M.R BASAVANTHAPPA
Digitally AGED ABOUT 55 YEARS
signed by
BHARATHI S
3. M.B.MALLIKARJUNA
Location:
HIGH COURT S/O LATE M.R BASAVANTHAPPA,
OF AGED ABOUT 57 YEARS
KARNATAKA
ALL ARE RESIDING AT
MUTHUGADURU VILLAGE
HOLALKERE TALUK
CHITRADURGA DISTRICT
...APPELLANTS
(BY SRI MANJUNATH K. ADVOCATE FOR
SRI N.RAJASJEKAR, ADVOCATE)
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MFA No. 10430 of 2012
AND:
1. SMT. MALLAMMA
W/O LATE E.DHARMACHAR
AGED ABOUT 52 YEARS
2. SRI. VIJAYAKUMAR D
S/O LATE F. DHARMACHAR
AGED ABOUT 24 YEARS
3. SRIRAM GENERAL INSURANCE CO LTD.,
E-8, ERIP, RIICO INDUSTRIAL AREA
SITAPURA, JAIPURA,
RAJASTHAN
BY ITS MANAGER
4. B.R PRAKASH,
S/O RANGAPPA
MAJOR IN AGE
R/O BANDE BOMMANAHALLI VILLAGE
HOLALKERE TALUK
CHITRADURGA
...RESPONDENTS
(BY SRI R. SHASHIDHARA, ADVOCATE FOR R1 & R2;
SRI B. PRADEEP, ADVOCATE FOR R3;
NOTICE TO R4 IS DISPENDSED WITH VIDE ORDER DATED
07.03.2014)
THIS MFA IS FILED U/S 173(1) OF THE MV ACT AGAINST
THE JUDGMENT AND AWARD DATED 21.8.2012 PASSED IN
MVC NO.921/2010 ON THE FILE OF II ADDITIONAL SENIOR
CIVIL JUDGE & 6TH ADDITIONAL MACT, DAVANGERE,
AWARDING A COMPENSATION OF RS.4,19,000/- WITH
INTEREST @ 6% P.A FROM THE DATE OF PETITION TILL THE
DATE OF REALIZATION.
THIS APPEAL, COMING ON FOR HEARING, THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
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MFA No. 10430 of 2012
JUDGMENT
The present appeal is filed by the owner challenging
the judgment and award dated 21.08.2012 passed in
MVC.No.921/2010 by the II Additional Senior Civil Judge
and VI Additional MACT, Davanagere.1
2. For the sake of convenience, the parties herein are
referred as per their rank before the Tribunal.
3. The Tribunal by this judgment and award dated
21.08.2012 has allowed the claim petition filed by the
claimant and awarded compensation of a sum of
`4,19,000/- together with interest at 6% per annum.
However, the liability to pay the compensation has been
fastened on the owner of the vehicle, who was Respondent
No.2 before the Tribunal. Being aggrieved, the present
appeal is filed by the owner.
4. The sole contention urged by the learned counsel
for the appellant/owner is that the Tribunal has fastened
the liability on the owner to pay the compensation, due to
Hereinafter referred as 'Tribunal'
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the fact that the vehicle was plying at the place, where he
did not have permit to operate and hence it was held that
there was violation of the permit condition and the Insurer
was exonerated from the liability of payment of the
compensation awarded. He further submits that the said
finding is erroneous and that even though there is a
violation of the permit condition, the compensation is
required to be fastened on the Insurer. In support of his
contention he relies on a decision of the Division Bench
judgments of this Court in the case of REHANA BEGUM
V/S NEW INDIA ASSURANCE COMPANY LIMITED.,2
and UNITED INDIA INSURANCE COMPANY LIMITED
V/S SANDHYA3.
5. Per contra, learned counsel for the
respondent/Insurer submits that the finding of the
Tribunal fastening the liability on the owner is just and
proper. In support of his contention he relies on a Division
Bench judgment of this Court in the case of SYED
judgment dated 27.07.2021 passed in MFA No.5960/2015 C/W 706/2013
judgment dated 7.06.2019 passed in MFA No.102428/2017(MV)
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ZAHEER @ SAYYED JAHIRUDDIN BOKHARI V/s
PUTTAMADAMMA,4.
6. The submissions made by both the learned
counsels have been considered and the material on record
have been perused including the records of the Tribunal.
The question that arises for consideration is 'whether the
finding of the Tribunal exonerating the Insurer from the
liability to pay the compensation is just and proper?
7. It is forthcoming from the material on record that
the accident occurred when the Insured bus was plying
from Davanagere to Kukkuvada Road. The evidence of
RW.2 and RW.3 discloses that the owner did not have the
permit to ply on the said road.
8. Having regard to the material on record it is clear
that the insured bus had a permit. However, it was plying
on the route where it was not permitted to be used. A
similar question arose before the co-ordinate Bench of this
Court in the case of DURUGAMMA V/S S.G.NARESH
dated 07.12.2023 passed in MFA No.5745/2016 C/W MFA No. 4811/2016
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AND OTHERS5 wherein after referring to various
judgments as also after referring to Section 207 of the
Motor Vehicles Act and this Court held that the liability to
pay the compensation is on the Insurer.
9. A Division Bench of this Court in the case of
REHANA BEGUM2 has after noticing various judgments,
held that plying of the vehicles outside the permitted zone
does not amount to fundamental statutory infraction and
that the Insurer cannot be absolved of its liability to pay
the compensation.
10. Further a Division Bench of this Court in the case
of UNITED INDIA INSURANCE COMPANY LIMITED3
has noticed the co-ordinate judgment of this Court in the
case of DURUGAMMA5 and as well as other judgments
has held as follows:
17. It is held in Durugamma's case stated supra
that, "there are different kinds of contravention of
the permit, one of which is relating to the route on
which or the area in which the vehicle may be used.
The purpose for which the vehicle may be used is
distinguishable from the terms and conditions of the
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permit. At last, the route on which or the area in
which the vehicle may be used, is one of the terms
and conditions of the permit. But the same cannot
be construed as the purpose for which the vehicle
was to be used. Making the distinction, the learned
Single Judge of this Court rightly came to the
conclusion that the terms and conditions attached to
each type of permit cannot be construed as a
purpose of the permit. The purpose and the terms
and conditions are two different aspects." Therefore,
the learned Single Judge interpreted that the
legislature in its wisdom has restricted the defence
that are available to the insurer under Section
149(2)(a)(i)(c) of the Act for a purpose and it is not
allowed by the permit and not for violation of any
terms and conditions of the permit. For example, if a
vehicle has a good carriage permit but has carried
passengers or vice versa, then it can be held that
the offending vehicle goods carriage permit is being
used for a purpose not allowed by the permit.
18. Therefore, the sole distinction on which the
authorities relied on by the learned counsel for the
appellant can be distinguished is on the ground that
whether there was any violation of the purpose for
which the vehicle was to be used and whether the
violation of exceeding the territorial jurisdiction
granted on the ground to ply the vehicle would
amount to violation of purpose for which the vehicle
was to be used. If that distinction is understood and
kept in mind, we find that whether the Insurance
Company can absolve its liability on the ground that
the vehicle in question has plied beyond the
territorial limits granted under the permit and
therefore there is no permit for the vehicle can be
decided. Further, the Insurance Company cannot
contend that its liability is absolves on the ground
that the purpose for which the vehicle was to be
used, is violated. Because in this case the sole
ground taken is violation of permit condition.
19. In this case admittedly the vehicle had a valid
permit to transport goods. It had valid permit to ply.
The violation complained is that of route permit, i.e.,
being territorial limits. The same cannot be a
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defence for the Insurance Company within the
purview of Sec. 149(2) of M.V. Act. We approve the
decision rendered by the learned Single Judge of this
Court in Durugamma's case stated supra. The fact
that the deceased was a labourer under the
respondent No.1 owner is not disproved by the
material placed on record. Therefore, on the above
said ground that the Insurance Company cannot
avoid its liability to satisfy the award. Accordingly,
point No.1 is answered in the negative.
(emphasis supplied)
11. Another Division Bench judgment of this Court in
the case of SYED ZAHEER @ SAYYED JAHIRUDDIN
BOKHARI4 has also noticed wherein other judgments as
well as various provisions of the Act and recorded the
finding that the Insurer can avoid its liability. However it is
relevant to note that although various judgments have
been noticed, Section 207 of the Act which enables
detention of vehicles used without permit has not been
noticed.
12. In the case of DURUGAMMA5 this Court has held
as follows:
16. Section 207 empowers any police officer or
other authorized person to seize and detain the
vehicle for the contraventions of sections 3 or
section 4 or section 39 or without the permit
required by sub-section [1] of section 66 or in
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contravention or any condition of such permit
relating to the route on which or the area in
which or the purpose for which the vehicle may
be used.
17. It is beneficial to refer to this provision only
to ascertain the intention of the legislature in
employing the words 'the purpose for which the
vehicle may be used'. There are different kinds
of contravention of the permit. One of it is
relating to the route on which or the area in
which the vehicle may be used. The purpose for
which the vehicle may be used is distinguishable
from the terms and conditions of the permit.
Utmost, route on which or the area in which the
vehicle may be used is one of the terms and
conditions of the permit. But, it cannot be
construed as the purpose for which the vehicle
may be used. The Hon'ble Apex Court while
considering this aspect relating to section 207 of
the Act, in the case of 'STATE OF MAHARASHTRA
AND OTHERS vs. NANDED-PARBHANI Z.L.B.M.V.
OPERATOR SANGH' reported in 2000 [2] SCC 69
has observed thus:
"According to the learned counsel appearing
for the State of Maharashtra the expression
"purpose for which the vehicle may be used"
could be construed to mean that when the
vehicle is found to be carrying passengers more
than the number prescribed in the permit, the
purpose of user is otherwise. We are unable to
accede to this contention as in our opinion, the
purpose would only refer to a contingency when
a vehicle having a permit of a stage carriage is
used as a contract carriage or vice versa or
where a vehicle having a permit for stage
carriage or contract carriage is used as a goods
vehicle and vice versa."
18. Though this decision is rendered in the
context of Section 207 of the Act, the same
would throw light to interpret the words 'for a
purpose not allowed by the permit' under Section
149[2][a][i][c] of the Act. 'Purpose' would be
construed as stage carriage, contract carriage,
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goods carriage, private vehicle, temporary
permit and so on. The terms and conditions
attached to each type of permit cannot be
construed as the purpose for the permit.
'Purpose' and 'the terms of conditions' are two
different aspects. The legislature in its wisdom
thought it fit to restrict the defence available
under Section 149[2][a][i][c] of the Act 'for a
purpose not allowed by the permit' and not for
'violation of any terms and conditions of the
permit'. For example, if a vehicle holding goods
carriage permit is carrying passengers or vice-
versa. Then, it can be held that the vehicle
holding goods carriage permit is being used for a
purpose not allowed by the permit. The breach of
conditions of the permit would by itself can not
be characterised as the purpose not allowed in
the permit. In CHALLA BHARATHAMMA's case
[supra], the Hon'ble Apex Court has held thus:
"12. High Court was of the view that since
there was no permit, the question of violation
of any condition thereof does not arise. The
view is clearly fallacious. A person without
permit to ply a vehicle cannot be placed at a
better pedestal vis-a-vis one who has a
permit, but has violated any condition thereof.
Plying of a vehicle without a permit is an
infraction. Therefore, in terms of Section
149(2) defence is available to the insurer on
that aspect. The acceptability of the stand is a
matter of adjudication. The question of policy
being operative had no relevance for the issue
regarding liability of insurer. High Court was,
therefore, not justified in holding the insurer
liable."
" The said judgment is rendered in the context of
'no permit'. The motor vehicle not possessing a
permit means the vehicle was not permitted to
ply in the public place or in other words, there is
infraction of law which clearly establishes the use
of the vehicle for a purpose not allowed in law.
Hence, the said Judgment of CHALLA
BHARATHAMMA's case [supra] is not applicable
to the facts of the present case.
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19. In CHALLA BHARATHAMMA's case [supra],
their Lordships have referred to the Judgment of
the Hon'ble Apex Court in the case of 'NEW
INDIA ASSURANCE CO., LTD., vs. ASHA RANI
AND OTHERS'reported in [2003 [2] SCC 223]
wherein it was observed as follows:
"We may consider the matter from another
angle. Section 149[2] of the 1988 Act enables
the insurers to raise defences against the
claim of the claimants. In terms of clause [c]
of sub-section [2] of section 149 of the Act
one of the defences which is available to the
insurer is that the vehicle in question has
been used for a purpose not allowed by the
permit under which the vehicle was used.
Such a statutory defence available to the
insurer would be obliterated in view of the
decision of this Court in Satpal Singh's case
[2000] 1 SCC 237."
20. In ASHA RANI's case [supra], the Hon'ble
Apex Court was considering a case of
unauthorized passengers travelling in a goods
vehicle. In that context, it was held that it is one
of the defence which is available to the insurer
under section 149[2][a][i][c] of the Act, whether
the vehicle has been used for a purpose not
allowed by the permit under which the vehicle
was used. Hence, the case on hand is
distinguishable from ASHA RANI's case [supra].
(emphasis supplied)
13. A Division Bench of this Court in the case of
UNITED INDIA INSURANCE COMPANY LIMITED AND
OTHERS V/S CHANDAMMA AND OTHERS6 as held as
follows:
6. Admittedly, the ground spelt out under sub-
clauses (b), (c) and (d) of clause (a)(i) and the
ILR 2000 KAR 1302
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ground under clause (b) of Section 149(2) are
not applicable to the defence of insurers in these
cases. On the other hand, an attempt had been
made for the insurers to bring their cases within
the purview of the defence ground envisaged in
sub-clause (a) of sub-section (2)(a)(i). This
ground is also not available to them for the
reason that, admittedly, each of the offending
vehicles was covered by a valid permit to carry
passengers for hire or reward as they were
"public service vehicles". Merely because these
vehicles were stated to have stopped and picked
up passengers on the permitted route,
presumably in breach of their permit condition,
that by itself does not constitute a statutory
defence available in sub-section (2)(a)(i)(a) of
Section 149. In fact, Section 149(2) of the New
Act i.e., Act of 1988, corresponds to Section
96(2) of the Old Act i.e., Act of 1939. The same
defence grounds as are contained in Section
149(2) of the New Act were existing as the
defence grounds under sub-section (2)(b) and
(c) of Section 96 of the Old Act. Similar question
had arisen for consideration of the Division
Bench of this Court in the case of K.V.
Thimmegowda v Kamalamma' and the same had
been answered holding:
"An Insurance Company is liable to pay
compensation in respect of the injury to or death
of a third party, caused by a motor accident by a
motor vehicle, which is a stage carriage while
plying or being used lawfully otherwise than as a
stage carriage, at a public place, even if such
public place does not lie on the route in respect
of which it is permitted to operate as a stage
carriage".
Therefore, in law the appellants/petitioners-
insurers are not exempt from their liability to pay
compensation under their respective 'Act Policies'
by mere reason of 'contract carriages' in
question being plied as 'stage carriages' in
breach of their permit condition since such a
defence plea is not permissible under sub-section
(2) of Section 149 of the Act. If the said vehicles
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were found to have been plying in breach of their
permits condition, it is open for the concerned
authorities under the Act to take appropriate
action as is permissible under other provisions
thereof viz., Sections 86, 177 and 192, as the
case may be. Therefore, we find the contention
of the learned Counsel for appellants/writ
petitioners without force and weight and the
appeals are, therefore, bound to fail.
(emphasis supplied)
14. Having regard to the discussion as noticed above,
it is clear that the interpretation of Section 207 as also
Section 149(2) of the Act and having notice the beneficial
nature of the legislation, it is just and proper that the view
of expressed in the case of REHANA BEGUM2 and
UNITED INSURANCE COMPANY3 is required to be
followed.
15. In view of the aforementioned, the following
order is passed:
ORDER
i) The above appeal is allowed;
ii) The judgment and award dated 21.08.2012
Passed in MVC No.921/2010 on the file of
the II Additional Senior Civil Judge and VI
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Additional MACT, Davanagere, is modified
to the extent ordered herein. In all other
respects, the judgment and award of the
Tribunal remain unaltered;
iii) The judgement of the Tribunal fastening
the liability to pay the compensation
awarded on the owner, who was arrayed as
respondent No.2 before the Tribunal and
appellant herein in the present appeal be
set aside and it is ordered that the
compensation awarded by the Tribunal shall
be paid by the Insurer, who was arrayed as
respondent No.3 before the Tribunal as well
as the present appeal.
iv) The Insurer shall deposit the compensation
awarded together with accrued interest
within eight weeks from the date of receipt
of a copy of this judgment;
v) The amount deposited in the above appeal
be refunded to the appellant.
vi) It is submitted that the above appeal
having abated vide order dated 10.12.2021
the amount deposited by the appellant has
been transmitted to the Tribunal. In the
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event, the claimants have withdrawn the
amount transmitted to the Tribunal, the
Insurer shall pay the said amount to the
owner of the vehicle.
vii) Registry to draw the modified award
accordingly;
viii) No costs.
SD/-
JUDGE
RMS
