Karnataka High Court
The Divisional Manager vs Raju S/O. Chandrakant Nidasoshi on 28 June, 2024
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MFA No. 26105 of 2011
IN THE HIGH COURT OF KARNATAKA,
DHARWAD BENCH
DATED THIS THE 28TH DAY OF JUNE, 2024
BEFORE
THE HON'BLE MR JUSTICE T. G. SHIVASHANKARE GOWDA
MISCELLANEOUS FIRST APPEAL NO. 26105 OF 2011 (MV)
BETWEEN:
THE DIVISIONAL MANAGER,
NEW INDIA ASSURANCE CO., LTD.,
DIVISIONAL OFFICE, CLUB ROAD, BELGAUM,
REPRESENTED THROUGH ITS
REGIONAL OFFICE,
NEW INDIA ASSURANCE CO., LTD.,
SRINATH COMPLEX, 2ND FLOOR,
NEW COTTON MARKET, HUBLI,
REPRESENTED BY ITS REGIONAL MANAGER.
...APPELLANT
(BY SRI. N.R. KUPPELUR, ADVOCATE)
AND:
1 . SRI. RAJU S/O. CHANDRAKANT NIDASOSHI,
AGE: 22 YEARS, OCC: NIL,
Digitally signed
by GIRIJA A SINCE MENTALLY DISABLED
BYAHATTI
Location: REPRESENTED BY HIS FATHER
HIGH COURT
OF SRI. CHANDRAKANTH B. NIDASOSHI,
KARNATAKA
AGE: 47 YEARS OCC: AGRICULTURE,
R/O: HARAGAPUR, TQ: HUKKERI,
DIST: BELGAUM.
2 . SRI. ASHOK SHANKAR KADAM,
AGE: MAJOR, OCC: BUSINESS,
R/O: 103, BHOJ AALI, KADAM VASTI,
NANNDED, TQ: HAVELI, DIST: PUNE,
(OWNER OF THE MOTOR CYCLE
BEARING NO. MH-12/EY-4005)
...RESPONDENTS
(BY SRI. V.V. BADIGER, ADVOCATE FOR R1;
NOTICE TO R2 SERVED BUT UNREPRESENTED)
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MFA No. 26105 of 2011
THIS MISCELLANEOUS FIRST APPEAL FILED UNDER SECTION
173(1) OF MOTOR VEHICLES ACT 1988, PRAYING TO CALL FOR THE
RECORDS, CONNECTED WITH MADE IN MVC NO.2178/2009 BY FAST
TRACK COURT-III, AND ADDITIONAL MACT, BELGAUM, AT:
BELGAUM, EXAMINE THE SAME AND SET ASIDE THE AWARD DATED
20/10/2011 AS AGAINST THE APPELLANT IN THE INTEREST OF
JUSTICE.
THIS APPEAL HAVING BEEN HEARD AND RESERVED FOR
JUDGMENT ON 18.06.2024 AND COMING ON FOR 'PRONOUNCEMENT
OF JUDGMENT', THIS DAY, PRONOUNCED THE FOLLOWING:
JUDGMENT
In this appeal, the insurance company has
challenged the judgment dated 20.10.2011 passed by the
Presiding Officer, FTC-III and Addl. MACT, Belagavi (for
short, 'Tribunal').
2. The appellant was the second respondent,
respondent No.1 was the petitioner and respondent No.2
was the first respondent before the Tribunal. For the sake
of convenience, the rank of the parties will be referred to
as per their status before the Tribunal.
3. Brief facts of the case are, on 13.02.2009, while
the petitioner was riding the motorcycle bearing No.MH-
12/EY-4005 on P.B. Road near Kanagala village, at about
9.30 p.m., another vehicle came and hit against the
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motorcycle of the petitioner. Due to the impact, the
petitioner sustained injuries. He was treated at
Government Hospital, Sankeshwar and KLE Hospital,
Belagavi under hospitalization. After taking treatment, he
approached the Tribunal seeking compensation of
Rs.15,00,000/- under Section 163-A of Motor Vehicle Act,
1988 (for short, 'M.V. Act'). The claim was opposed by the
insurance company on the ground that the petitioner is the
borrower of the motorcycle and he is a de-facto owner, he
is not a third party to claim the compensation and the
insurance company has no liability to indemnify the owner.
4. After taking the evidence and hearing both the
parties, the Tribunal, by the impugned judgment and
award, partly allowed the claim petition and awarded
compensation of Rs.5,09,600/- with 8% interest directing
the owner and the insurer of the motorcycle to pay the
compensation. Aggrieved by the same, the insurance
company has filed this appeal on various grounds.
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5. Heard the arguments of Sri N.R. Kuppellur,
learned counsel for insurance company and Sri V.V.
Badiger, learned counsel for petitioner.
6. It is the contention of the learned counsel for
insurance company that the claim is filed under Section
163-A of the M.V. Act. The petitioner while riding an
unknown vehicle hit his motorcycle and ran away causing
the injuries. FIR was registered against the unknown
vehicle and 'C' final report has been filed against the
unknown vehicle. There is no eyewitness to the accident
and policy is a package policy. The first respondent is the
owner of the motorcycle. As the petitioner being the
borrower, entered into the shoes of the first respondent
thereby becomes defacto owner and he cannot claim
against himself. The Tribunal has erroneously fastened
the liability against the insurance company in stead of
dismissing the claim petition.
7. Per contra, learned counsel for petitioner has
contended that the petitioner is the rider of the motorcycle
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at the time of accident. As the FIR was registered against
an unknown vehicle, the Investigating Officer did not trace
out the details of the said vehicle. Hence, the petitioner
could not claim against the unknown vehicle. There is no
negligence on the part of the petitioner. In order to make
claim under Section 163-A of M.V. Act, proof of negligence
is not required. Mere involvement of the vehicle if shown is
suffice and thereby the claim petition is maintainable.
Learned counsel also contended that the petitioner being
the rider of the motorcycle stands in the footing of a third
party. Hence, the Tribunal has assessed the compensation
by applying structured formula and insurance company is
liable to pay the compensation. To support his case,
learned counsel has relied the following decisions:
1) Ramakhiladi and another Vs. United India Insurance
Company and another1
2) Shivaji and another Vs. Divisional Manager, United
India Insurance Company Limited and others2
AIR 2020 SC 527
(2009) 12 SCC 395
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8. I gave my anxious consideration to the
arguments addressed by the learned counsel for both the
parties and perused the records.
9. The material on record points out that on
13.02.2009, while the petitioner was riding the motorcycle
bearing No.MH-12/EY-4005 along with pillion rider
Shivanand Mallappa Halatti near Government Hospital on
P.B. Road of Kanagala at about 9.30 p.m., another vehicle
hit against the said motorcycle and caused the accident.
Due to the accident, the petitioner sustained head injury
and he was treated at Government Hospital and KLE
Hospital, Belagavi under hospitalisation and also
underwent surgeries. Ex.P-15 case sheet shows that the
petitioner was under hospitalization between 13.12.2009
to 12.03.2009. He has spent huge money towards
treatment. Being aged 21 years, the petitioner suffered
disability. The disability aspect of the petitioner has been
spoken by PW-2 and PW-3 Dr. Nandkumar Joshi and Dr.
Shambalingappa S. Mahantshetty explaining that the
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petitioner has suffered 80% of the whole body disability.
Since the claim is under Section 163-A of the M.V. Act,
income of the petitioner was restricted to Rs.3,000/- p.m.
and thereby the Tribunal applied structured formula and
assessed 80% of the disability and awarded Rs.4,86,600/-
towards loss of future earning, Rs.5,000/- towards pain
and suffering. Though the petitioner has produced bill
worth Rs.1,25,735/- in view of Schedule II of M.V. Act,
Rs.15,000/- is awarded and thereby a sum of
Rs.5,09,600/- is awarded by the Tribunal.
10. Having regard to the fact and circumstances of
the case and also the evidence placed on record, the
compensation assessed by the Tribunal is just and proper
for which the petitioner is entitled to.
11. The Tribunal relied on the judgment in National
Insurance Company Limited Vs. Honnappa and others3
and also the judgment of the Hon'ble Apex Court in
Oriental Insurance Company Limited Vs. Smt. Salma and
ILR 2008 KAR 959
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others4 held that the respondent No.1 is the owner,
respondent No.2 being the insurer issued the insurance
policy Ex.R-1, both are liable to pay the compensation as
there is no question of considering negligence on the part
of the petitioner and the petitioner became third party as
two vehicles are involved in the accident and therefore, he
is entitled to claim compensation from the owner which
needs to be indemnified by the insurer. In view of this,
the question arises is whether the insurance company is
having liability to indemnify the owner?
12. It is the contention of the learned counsel for
the insurance company that another vehicle involved in
the accident is an unknown and it is a hit and run case.
Therefore, the provisions of Section 163-A of the M.V. Act
is not applicable as there is a specific provision made to
claim compensation in a case of hit and run. It is also
argued that the petitioner is borrower of the motorcycle
and in view of the principles laid down in the case of
Ningamma and another Vs. United India Insurance
ILR 2008 KAR 1249
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Company Limited5, the borrower of the motorcycle stands
in the pedestal of the owner. Therefore, the owner cannot
make a claim against himself and the insurance company
has no liability to indemnify the owner.
13. In Ramakhiladi's case, there was an accident
involving two vehicles wherein the deceased was travelling
in motorcycle and claim was made under Section 163-A of
the M.V. Act. In that case, an objection was raised by the
insurance company that the claimants have stated that the
rider of the opponent motorcycle was rash and negligent
and claim was not filed against the owner of the said
vehicle and the claim petition needs to be dismissed.
Under such circumstances, the Hon'ble Apex Court held of
the judgment as under:
"5.5 It is true that, in a claim under Section 163A of the Act,
there is no need for the claimants to plead or establish the
negligence and/or that the death in respect of which the claim
petition is sought to be established was due to wrongful act,
neglect or default of the owner of the vehicle concerned. It is
also true that the claim petition under Section 163A of the Act is
based on the principle of no fault liability. However, at the same
time, the deceased has to be a third party and cannot maintain
(2009) 13 SCC 710
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a claim under Section 163A of the Act against the owner/insurer
of the vehicle which is borrowed by him as he will be in the
shoes of the owner and he cannot maintain a claim under
Section 163A of the Act against the owner and insurer of the
vehicle bearing registration No. RJ 02 SA 7811. In the present
case, the parties are governed by the contract of insurance and
under the contract of insurance the liability of the insurance
company would be qua third party only. In the present case, as
observed hereinabove, the deceased cannot be said to be a
third party with respect to the insured vehicle bearing
registration No. RJ 02 SA 7811. There cannot be any dispute
that the liability of the insurance company would be as per the
terms and conditions of the contract of insurance. As held by
this Court in the case of Dhanraj (supra), an insurance policy
covers the liability incurred by the insured in respect of death of
or bodily injury to any person (including an owner of the goods
or his authorized representative) carried in the vehicle or
damage to any property of a third party caused by or arising
out of the use of the vehicle. In the said decision, it is further
held by this Court that Section 147 does not require an
insurance company to assume risk for death or bodily injury to
the owner of the vehicle."
5.6 In view of the above and for the reasons stated above, in
the present case, as the claim under Section 163A of the Act
was made only against the owner and insurance company of the
vehicle which was being driven by the deceased himself as
borrower of the vehicle from the owner of the vehicle and he
would be in the shoes of the owner, the High Court has rightly
observed and held that such a claim was not maintainable and
the claimants ought to have joined and/or ought to have made
the claim under Section 163A of the Act against the driver,
owner and/or the insurance company of the offending vehicle
i.e. RJ 29 2M 9223 being a third party to the said vehicle."
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5.8 However, at the same time, even as per the contract of
insurance, in case of personal accident the owner-driver is
entitled to a sum of Rs.1 lakh. Therefore, the deceased, as
observed hereinabove, who would be in the shoes of the owner
shall be entitled to a sum of Rs.1 lakh, even as per the contract
of insurance. However, it is the case on behalf of the original
claimants that there is an amendment to the 2nd Schedule and
a fixed amount of Rs.5 lakh has been specified in case of death
and therefore the claimants shall be entitled to Rs.5 lakh. The
same cannot be accepted. In the present case, the accident
took place in the year 2006 and even the Judgment and Award
was passed by the learned Tribunal in the year 2009, and the
impugned Judgment and Order has been passed by the High
Court in 10.05.2018, i.e. much prior to the amendment in the
2nd Schedule. In the facts and circumstance of the present
case, the claimants shall not be entitled to the benefit of the
amendment to the 2nd Schedule. At the same time, as
observed hereinabove, the claimants shall be entitled to Rs.1
lakh as per the terms of the contract of insurance, the driver
being in the shoes of the owner of the vehicle."
14. The Hon'ble Apex Court ultimately held that the
insurance company is liable to pay the compensation to a
third party and not to the owner to the extent of
Rs.1,00,000/- under Personal Accident cover. Accordingly,
directed the insurance company to pay Rs.1,00,000/- with
interest.
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15. In Shivaji's case, the deceased was the driver
of the car in question met with an accident dashed into a
truck resulting in his death. The claim was under Section
163-A of the M.V. Act by the heirs of the deceased person.
The Tribunal awarded compensation directing the
insurance company to pay the compensation. When the
matter was come up before the High Court, it was held
that the compensation could not have been awarded to the
appellants for the reason that the deceased being the
driver of the car was the tortfeasor and responsible for
causing the accident. Referring to the judgment in the
case of United India Insurance Company Limited Vs.
Sunilkumar and another6, the Hon'ble Apex Court held
that in a petition under Section 163-A of the Act there is
no defence available to the insurance company to raise the
negligence to bring the claim petition on par with the claim
under Section 166 of the M.V. Act and directed that the
compensation to be paid to the legal representatives of the
(2019) 12 SCC 398
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deceased driver of the car and the order of the Tribunal
was restored.
16. The principles laid down in the case of Shivaji
are not applicable to the facts of this case. Here in this
case, the vehicle which was caused accused was not
identified and the injured is the borrower of the motorcycle
from the owner and he enters into the shoes of the owner
and he cannot make a claim against his own. In Shivaji's
case, the deceased was not the owner of the car. Hence,
the petitioner herein cannot make a claim against himself
as he being a borrower of the motorcycle enters into the
shoes of the owner.
17. Ex.P-1 is the policy in which the parties are
under the contract. The terms of the policy points out that
it covers the own damage for the vehicle and liable to
cover Personal Accident to the owner-cum-driver at
Rs.1,00,000/-. The petitioner being the borrower of the
motorcycle, by virtue of the principles laid down in the
case of Ramakhiladi, the petitioner is entitled to claim
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the compensation to the extent of Personal Accident cover
available to the owner. The finding recorded by the
Tribunal that the insurance company has to pay the
compensation to the owner of the vehicle is not
permissible as the petitioner is not a third party to make a
claim against the real owner. Hence, to the extent of
liability, the appeal merits consideration, in the result, the
following:
ORDER
(i) Appeal is allowed in part.
(ii) The judgment and award dated 20.10.2011
passed by the Presiding Officer, FTC-III and
Addl. MACT, Belagavi, awarding the
compensation of Rs.5,09,600/- with interest
at 8% p.a. is hereby confirmed.
(iii) Out of the said compensation amount, the
insurance company is directed to deposit a
sum of Rs.1,00,000/- with interest at 8% p.a.
from the date of petition till the date of
deposit within a period of eight weeks from
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the date of receipt of certified copy of this
judgment.
(iv) The petitioner shall recover the rest of the
compensation from the owner of the
motorcycle i.e., the first respondent before the
Tribunal. The award of the Tribunal is modified
accordingly.
(v) The amount in deposit shall be transmitted to
the Tribunal.
Sd/-
JUDGE
NAA
