Karnataka High Court

National Insurance Co. Ltd vs Sri.Sampat on 27 May, 2024

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                                                        NC: 2024:KHC-D:7018
                                                         MFA No. 101808 of 2016




                      IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH

                              DATED THIS THE 27TH DAY OF MAY, 2024

                                             BEFORE
                            THE HON'BLE MR JUSTICE VENKATESH NAIK T
                   MISCELLANEOUS FIRST APPEAL NO. 101808 OF 2016 (MV-I)

                   BETWEEN:

                   NATIONAL INSURANCE CO. LTD,
                   THE MANAGER, RAMDEV GALLI,
                   BELAGAVI, REPRESENTED THROUGH ITS
                   REGIONAL OFFICE, ARIHANT PLAZA,
                   KUSUGAL ROAD, HUBBALLI,
                   REPRESENTED BY ITS MANAGER.

                                                                     ...APPELLANT
                   (BY SMT. PREETI SHASHANK AND
                       SRI. SHASHANK S. HEGDE, ADVOCATES)

                   AND:

                   SRI. SAMPAT S/O. LAXMAN SAMBREKAR,
                   AGE: 44 YEARS, OCC: RUNNING DHABA,
                   R/O: HONAGA,
                   TQ AND DISTRICT: BELAGAVI.

Digitally signed
                                                                    ...RESPONDENT
by MANJANNA E      (BY SRI. ASHOK A. NAIK, ADV. FOR RESPONDENT)
Location: HIGH
COURT OF
KARNATAKA
                          THIS MFA IS FILED U/S.173(1) OF MOTOR VEHICLES ACT
                   1988, AGAINST THE JUDGMENT & AWARD DATED 19.03.2016,
                   PASSED IN MVC.NO.853/2013 ON THE FILE OF THE X ADDITIONAL
                   DISTRICT AND SESSIONS JUDGE AND MEMBER ADDITIONAL MOTOR
                   ACCIDENT    CLAIMS   TRIBUNAL,     BELAGAVI,   AWARDING   THE
                   COMPENSATION OF RS.35,000/- WITH INTEREST AT THE RATE OF
                   6% P.A. FROM THE DATE OF PETITION TILL ITS DEPOSIT.

                          THIS APPEAL, COMING ON FOR HEARING ON INTERLOCUTORY
                   APPLICATION, THIS DAY, THE COURT DELIVERED THE FOLLOWING:
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                                      NC: 2024:KHC-D:7018
                                       MFA No. 101808 of 2016




                         JUDGMENT

This appeal is filed by the Insurance Company

challenging the judgment and award dated 19.03.2016

passed in MVC No.853/2013 on the file of the X Additional

District and Sessions Judge and Member Additional MACT,

Belagavi (for short 'the Tribunal'), challenging the award

of compensation of Rs.35,000/- under no fault liability.

2. For the sake of convenience, the parties are

referred to as per their rank referred to in the claim

petition before the Tribunal.

3. The factual matrix of the case is that on

06.04.2010 at about 8.30 p.m., the petitioner was riding

his motorcycle bearing registration No.KA-22/W-0437 from

Honaga towards Kakati. One Parashuram Muchandi was

sitting as a pillion rider, when they came near Markandeya

River Bridge on NH-4 Service Road, at that time the rider

of motorcycle bearing registration No.MH-09/F-4404 came

from opposite side and both the motorcycles collided each

NC: 2024:KHC-D:7018

other. Due to the said impact, the petitioner sustained

injuries and was shifted to District Hospital, Belagavi,

wherein he was admitted as inpatient from 06.04.2010 to

09.04.2010. He has spent huge amount towards medical

expenses. Immediately after the accident, the claimant

approached the respondent-Insurer to pay required

compensation, but respondent-Insurer refused to pay the

compensation. Thus claimant filed the claim petition under

Section 163-A of the Motor Vehicles Act (for short, 'the

M.V. Act').

4. Respondent/Insurance Company has filed

detailed objections and contended that the respondent is

not liable to pay any compensation in respect of the

accident caused by the claimant and the Tribunal has no

jurisdiction to try the petition. It is contended that

claimant ought to have approach the Consumer Forum for

the act of respondent. In support of contentions of the

learned counsel for the Insurer, she relied upon the

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judgment dated 24.08.2023 passed by the Co-Ordinate

Bench of this Court in MFA No.24796/2012.

5. Heard the learned counsel appearing for the

respondent/appellant and learned counsel for the

claimant/respondent. Perused the judgment and award of

the Tribunal.

6. The following points that arise for consideration

in this appeal by this Court are;

"i) "Whether the Tribunal has committed an error in awarding the compensation under no fault liability invoking Section 140 of M.V.Act?"

ii) "Whether the Insurance Company is liable to pay compensation to the claimant, when the personal accident claim benefit is insured with the insurer, when the borrower of the vehicle stepped into the shoes of original owner?"

NC: 2024:KHC-D:7018

7. It is not in dispute that the injured is the owner

of motorcycle bearing registration No.KA-22/W-0437, who

met with an accident. It is also not in dispute that two

vehicles were involved in the accident. Thus it is clear

that, there is relationship between the insured and insurer.

The accident occurred when the claimant was riding his

motorcycle, but the rider of the motorcycle bearing

registration No.MH-09/F-4404 came from opposite

direction and dashed to the motorcycle of the claimant.

8. The Hon'ble Apex Court in case of Ramkhiladi

and Another Vs. United India Insurance company1 at

paras 9.9 to 10 reads as under:

"9.9 Now, so far as the submission made on behalf of the claimants that in a claim under Section 163-A of the Act mere use of the vehicle is enough and despite the compensation claimed by the heirs of the owner of the motorcycle a which was involved in the accident resulting in his death, the claim under Section 163-A of the Act would be maintainable is concerned, in view of the decision of this Court in Rajni Devi8, the aforesaid cannot be accepted. In Rajni Devi8, it has been specifically observed and held that the provisions of Section 163-A of the Act cannot be said to have any

(2020) 2 SCC 550

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application with regard to an accident wherein the owner of the motor vehicle himself is involved. After b considering the decisions of this Court in Oriental Insurance Co. Ltd. v. Jhuma Saha10; Dhanraj7: National Insurance Co. Ltd. v. Laxmi Narain Dhut11 and Premkumari v. Prahlad Dev12, it is ultimately concluded by this Court that the liability under Section 163-A of the Act is on the owner of the vehicle as a person cannot be both, a claimant as also a recipient and, therefore, the heirs of the owner could not have maintained the claim in terms of Section 163-A of the Act. It is further observed that, for the said purpose, only the terms of the contract of insurance could be taken recourse to. In the recent decision of this Court in Ashalata Bhowmik9, it is specifically held by this Court that the parties shall be governed by the terms and conditions of the contract of insurance. Therefore, as per the contract of insurance, the insurance company shall be liable to pay the compensation to a third party and not to the owner, except to the extent of Rs 1 lakh as observed hereinabove.

10. In view of the above and for the reasons stated above, the present appeal is partly allowed to the aforesaid extent and it is observed and held that the original claimants shall be entitled to a sum of Rs 1 lakh only with interest @7.5 per cent per annum from the date of the claim petition till realisation. In the facts and circumstance of the present case, there shall be no order as to costs."

9. Further, the Hon'ble Apex Court in case of

National Insurance Company Limited Vs. Ashalata

NC: 2024:KHC-D:7018

Bhowmik and Others2 at paras 15 to 17 reads as

under:

"15. In the light of the foregoing discussion and the grounds mentioned above, which found acceptance to the Tribunal, we are of the considered opinion that the appellant is entitled for a further sum of Rs.5,00,000/- in lump sum in addition to what has been awarded by the Tribunal, i.e., Rs.3,43,000/-.

16. In other words, the appellant (claim-ant) is now entitled to claim a total sum of Rs.8,43,000/- from the respondents jointly and severally by way of compensation for the injuries sustained, partial and permanent dis- ability occurred, medical expenses incurred and loss occasioned due to injuries sustained by him in the accident.

17. We, however, do not award interest on the enhanced sum of Rs.5,00,000/-, which we have awarded to the appellant. In this view of the matter, the appellant is entitled to claim interest only on the sum of Rs.3,43,000/- at the rate of 8% awarded by the Tribunal."

10. Having perused the judgment and award of the

Tribunal, the Tribunal comes to the conclusion that the

claimant is entitled for compensation under section 163-A

of the Act.

AIR 2018 SC 4133

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11. Section 163-A of the M.V. Act is a special

provisions as to payment of compensation on structured

formula basis, which reads is as under:

12. [163A. Special provisions as to payment of compensation on structured formula basis. -(1) notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle or the authorised insurer shall be liable to pay in the case of death or permanent disablement due to accident arising the out of the use of motor vehicle, compensation, as indicated in the second schedule, to the legal heirs or the victim, as the case may be.

Explanation.__ For the purpose of this sub-section, "permanent disability" shall have the same meaning and extent as in the Workmen's Compensation Act, 1923 (8 of 1923).

(2) In any claim for compensation under sub- section (1), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person.

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(3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time amend the Second Schedule]

13. Therefore, if a claim for compensation is made

under Section 163-A of the Act by an injured alleging the

disability, and if quantum of loss of future earning claimed,

falls under the second Scheduled to the Act, the Tribunal,

may have to apply the principles laid down in the Note (5)

of the Second Schedule to the Act to determine

compensation. The similar ratio is laid down in the case of

Raj Kumar Vs. Aijay Kumar3.

14. Further there is contractual obligations between

the insurer and injured, thus for any injury or damage the

insurer shall liable to pay the compensation to the

claimant. It has to be noted that once owner of the vehicle