Karnataka High Court
Shri.Motilal S/O Danappa Rathod vs Tarabai And Ors on 28 January, 2025
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NC: 2025:KHC-K:610
MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
IN THE HIGH COURT OF KARNATAKA,
KALABURAGI BENCH
DATED THIS THE 28TH DAY OF JANUARY, 2025
BEFORE
THE HON'BLE MR. JUSTICE C M JOSHI
MISCL. FIRST APPEAL NO.201851 OF 2018
C/W
MISCL. FIRST APPEAL NO.202366 OF 2018
MISCL. FIRST APPEAL NO.202367 OF 2018
MFA CROSS OBJ. NO.200008 OF 2019
MFA CROSS OBJ. NO.200009 OF 2019 (WC)
IN MFA NO.201851/2018:
BETWEEN:
1. TARABAI W/O ASHOK CHAVAN,
AGE: 30 YEARS, OCC: H.H.WORK,
Digitally
signed by
LUCYGRACE
2. AJIT S/O ASHOK CHAVAN,
LUCYGRACE Date:
2025.02.10
10:44:13 -
AGE: 16 YEARS, OCC: STUDENT,
0800
3. AMIT S/O ASHOK CHAVAN,
AGE: 18 YEARS, OCC: STUDENT,
4. JALABAI W/O DEVALU CHAVAN,
AGE: 64 YEARS, OCC: NIL,
ALL R/O BEENA R. RATHOD YASMIN MANZIL,
NEAR SHANMUKHSWAMY MATH,
GOLGUMBAZ ROAD, VIJAYAPUR-586 101.
...APPELLANTS
(BY SRI. BABU H. METAGUDDA, ADVOCATE)
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MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
AND:
1. MOTILAL S/O DANAPPA RATAHOD,
AGE: 42 YEARS, OCC: BUSINESS,
R/O 1611/4, ORDA CANDOLIM BARDEZ,
GOA, DIST. NORTH GOA, GOA-403 515.
2. THE BRANCH MANAGER,
UNITED INDIA INSURANCE CO. LTD.,
S.S. FRONT ROAD, VIJAYAPUR-586 101.
...RESPONDENTS
(BY SRI. S.S. MAMADAPUR, ADV. FOR R1;
SRI. MANVENDRA REDDY, ADV. FOR R2)
THIS MFA IS FILED UNDER SECTION 30(1) OF THE
EMPLOYEES COMPENSATION ACT, PRAYING TO ALLOW THE
APPEAL AND MODIFY THE JUDGMENT AND AWARD DATED
27.06.2018 PASSED IN E.C.A.NO.238/2014 BY THE III ADDL.
SENIOR CIVIL JUDGE AND BEFORE THE COMMISSIONER FOR
EMPLOYEES COMPENSATION AT VIJAYAPUR AND ENHANCE THE
COMPENSATION FROM RS.8,25,400/- WITH 12% INTEREST
TO RS.15,00,000/- WITH 12% INTEREST;) ALLOW THIS
APPEAL AND DIRECT THE RESPONDENT NO.2 INSURANCE
COMPANY TO PAY THE ENTIRE INTEREST FROM THE DATE OF
ACCIDENT TO DATE OF DEPOSIT.
IN MFA NO.202366/2018:
BETWEEN:
THE BRANCH MANAGER,
UNITED INDIA INSURANCE CO. LTD.,
S.S. FRONT ROAD, VIJAYAPUR,
NOW THROUGH ITS
DIVISIONAL MANAGER.
...APPELLANT
(BY SRI. MANVENDRA REDDY, ADVOCATE)
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MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
AND:
1. TARABAI W/O ASHOK CHAVAN,
AGE: 30 YEARS, OCC: HOUSEHOLD WORK,
2. AJIT S/O ASHOK CHAVAN,
AGE: 16 YEARS, OCC: STUDENT,
3. AMIT S/O ASHOK CHAVAN,
AGE: 18 YEARS, OCC: STUDENT,
4. JALABAI W/O DEVALU CHAVAN,
AGE: 64 YEARS, OCC:NIL,
RESPONDENT NO.2 IS MINOR,
R/BY THE NATURAL MOTHER
M/G PETITIONER NO.1 SMT. TARABAI,
ALL R/O BEENA R. RATHOD,
YASMIN MANZIL,
NEAR SHANMUKHSWAMY MATH,
GOLGUMBAZ ROAD, VIJAYAPUR-586 101.
5. MOTILAL S/O DANAPPA RATHOD,
AGE: 41 YEARS, OCC: BUSINESS,
R/O 1611/4, ORDA CANDOLIM, BARDEZ,
GOA, DIST. NORTH GOA, GOA-403 515,
(EMPLOYER OF DECEASED/ OWNER OF
SWARAZ MAZDA TIPPER NO.GA-03/K-9705).
...RESPONDENTS
(BY SRI. BABU H. METAGUDDA, ADV. FOR R1, R3 & R4;
R2 IS MINOR, R/P BY R1;
SRI. S.S. MAMADAPUR, ADV. FOR R5)
THIS MFA IS FILED UNDER SECTION 30(1) OF THE
EMPLOYEES COMPENSATION ACT, PRAYING TO SET ASIDE THE
JUDGMENT AND AWARD DATED 27.06.2018 PASSED BY THE
III ADDL. SENIOR CIVIL JUDGE AND COMMISSIONER FOR
EMPLOYEES COMPENSATION ACT, VIJAYAPUR IN ECA
NO.238/2014 BY ALLOWING THE APPEAL AS PRAYED FOR.
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MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
IN MFA NO. 202367/2018:
BETWEEN:
THE BRANCH MANAGER,
UNITED INDIA INSURANCE CO. LTD.,
S.S. FRONT ROAD, VIJAYAPUR,
NOW THROUGH ITS
DIVISIONAL MANAGER.
...APPELLANT
(BY SRI. MANVENDRA REDDY, ADVOCATE)
AND:
1. KUMAR S/O SOMASINGH RATHOD,
AGE: 32 YEARS, OCC: CLEANER,
R/O C/O ANIL RATHOD, BENDIGERE GALLI,
GOLAGUMBAZ ROAD,
VIJAYAPUR-586 101.
2. MOTILAL S/O DANAPPA RATHOD,
AGE: 41 YEARS, OCC: BUSINESS,
R/O 1611/4, ORDA CANDOLIM, BARDEZ,
GOA, DIST. NORTH GOA, GOA-403 515.
(EMPLOYER OF DECEASED/ OWNER OF
SWARAZ MAZDA TIPPER NO.GA-03/K-9705).
...RESPONDENTS
(BY SRI. S.S. MAMADAPUR, ADV. FOR R2;
R1-SERVED, BUT UN-REPRESENTED)
THIS MFA IS FILED UNDER SECTION 30(1) OF THE
EMPLOYEES COMPENSATION ACT, PRAYING TO SET ASIDE THE
JUDGMENT AND AWARD DATED 27.06.2018 PASSED BY THE
III ADDITIONAL SENIOR CIVIL JUDGE AND COMMISSIONER
FOR EMPLOYEES COMPENSATION ACT, VIJAYAPUR, IN ECA
NO.239/2014, BY ALLOWING THE APPEAL AS PRAYED FOR.
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MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
IN MFA CROB NO.200008/2019:
BETWEEN:
SHRI MOTILAL S/O DANAPPA RATHOD,
AGED ABOUT 43 YEARS, OCC: BUSINESS,
R/O 1611/4, ORDA CANDOLIM, BARDEZ,
GOA, DIST. NORTH GOA, GOA-403 515.
...CROSS OBJECTOR
(BY SRI. S.S. MAMADAPUR, ADVOCATE)
AND:
1. SMT. TARABAI W/O ASHOK CHAVAN,
AGED ABOUT 31 YEARS, OCC: HOUSEWIFE,
2. AJIT S/O ASHOK CHAVAN,
AGED ABOUT 17 YEARS, OCC: STUDENT,
3. AMIT S/O ASHOK CHAVAN,
AGED ABOUT 19 YEARS, OCC: STUDENT,
PETITIONERS 1 & 2 ARE MINORS,
REP. BY THEIR NATURAL MOTHER
M/G PETITIONER -1, SMT. TARABAI,
4. SMT. JALABAI W/O DEVALU CHAVAN,
AGED ABOUT 65 YEARS, OCC: NIL,
ALL ARE R/O BEENA R. RATHOD, YASMIN MANZIL,
NEAR SHANMUKHSWAMY MATH,
GOLGUMBAZ ROAD, VIJAYAPUR-586 101.
5. THE BRANCH MANAGER,
UNITED INDIA INSURANCE CO. LTD.,
S.S. FRONT ROAD, VIJAYAPUR-586 101.
...RESPONDENTS
(BY SRI. BABU H. METAGUDDA, ADV. FOR R1 TO R4;
SRI. MANVENDRA REDDY, ADV. FOR R5)
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MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
THIS MFA CROB IS FILED UNDER ORDER 41 RULE 22 OF
THE CODE OF CIVIL PROCEDURE, PRAYING TO SET ASIDE THE
JUDGMENT AND AWARD DATED 27.06.2018 PASSED BY THE
HON'BLE III ADDL. SENIOR CIVIL JUDGE AND COMMISSIONER
FOR EMPLOYEES COMPENSATION, VIJAYAPUR IN ECA
NO.238/2014 TO THE EXTENT IT HOLDS APPELLANT LIABLE TO
PAY THE INTEREST ON COMPENSATION.
IN MFA CROB NO.200009/2019:
BETWEEN:
SHRI. MOTILAL S/O DANAPPA RATHOD,
AGED ABOUT 43 YEARS, OCC: BUSINESS,
R/O 1611/4, ORDA CANDOLIM, BARDEZ,
GOA, DIST. NORTH GOA, GOA-403 515.
...CROSS OBJECTOR
(BY SRI. S.S. MAMADAPUR, ADVOCATE)
AND:
1. KUMAR S/O SOMASING RATHOD,
AGED ABOUT 33 YEARS, OCC: CLEANER,
R/O C/O ANIL RATHOD, BENDIGERI GALLI,
GOLGUMBAZ ROAD, VIJAYAPUR.
2. THE BRANCH MANAGER,
UNITED INDIA INSURANCE CO. LTD.,
S.S. FRONT ROAD, VIJAYAPUR-586 101.
...RESPONDENTS
(BY SRI. MANVENDRA REDDY, ADV. FOR R2)
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MFA No. 201851 of 2018
C/W MFA No. 202366 of 2018
MFA No. 202367 of 2018
AND 2 OTHERS
THIS MFA CROB IS FILED UNDER ORDER 41 RULE 22 OF
THE CODE OF CIVIL PROCEDURE, PRAYING TO SET ASIDE THE
JUDGMENT AND AWARD DATED 27.06.2018 PASSEED BY THE
HON'BLE III ADDL. SENIOR CIVIL JUDGE AND COMMISSIONER
FOR EMPLOYEES COMPENSATION, VIJAYPUR, IN ECA
NO.239/2014 TO THE EXTENT IT HOLDS THE APPELLANT
LIABLE TO PAY INTEREST ON THE AWARD FROM THE DATE OF
ACCIDENT TILL THE DATE OF AWARD.
THE THREE APPEALS AND TWO MFA CROSS OBJECTIONS
COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS
DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE C M JOSHI
ORAL JUDGMENT
(PER: HON'BLE MR. JUSTICE C M JOSHI)
These appeals arise out of the common judgment
and awards dated 27.06.2018 passed in ECA
Nos.238/2014 and 239/2014 by the learned III Additional
Senior Civil Judge and Commissioner for Employees
Compensation, Vijayapura (hereinafter referred to as 'the
Commissioner' for short). Being aggrieved by the said
common judgment, the petitioners in ECA No.238/2014
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AND 2 OTHERS
have filed MFA No.201851/2018; Respondent No.2-
Insurance Company has filed MFA No.202366/2018 and
respondent No.1-owner has filed MFA Crob
No.200008/2019. Similarly, being aggrieved by the said
judgment, the Insurance Company in ECA No.239/2014
has filed MFA No.202367/2018 and the owner has filed
MFA Crob No.200009/2019.
2. For the sake of convenience, the parties would
be referred to as per their ranking before the Tribunal.
3. The factual matrix of the case in short, is as
below:
The petitioners in ECA No.238/2014 are the
dependents of one Ashok Chavan, who died in the
accident. The petitioner - Kumar in ECA No.239/2014 is
the injured, who is the cleaner of the vehicle involved in
the said accident.
The deceased Ashok Chavan and the injured-Kumar
were working as driver and cleaner in mini tipper lorry
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AND 2 OTHERS
bearing No.GA-03/K-9705, which is owned by respondent
No.1-Motilal. On 08.07.2013, when the said lorry loaded
with stones was proceeding from Kasarwada to Gurium in
Goa, an Ashok Layland Truck bearing No.MH-07/X-0963
came from opposite direction and collided with the mini
tipper lorry. In the said accident, Ashok Chavan died on
the spot and Kumar, having suffered injuries, was shifted
to the hospital at Goa and thereafter, he took treatment at
Kerudi Hospital, Bagalkot. Therefore, the dependants of
Ashok Chavan and the injured Kumar filed claim petitions
against the owner and insurer of the tipper lorry bearing
No.GA-03/K-9705, seeking compensation under the
provisions of the Employee's Compensation Act, 1923 (for
short 'E.C. Act').
4. On service of notice, the owner and insurer of
the mini tipper lorry appeared and filed their written
statements. The owner admitted that the deceased Ashok
Chavan and injured Kumar were employees under him,
but denied the quantum of the salary claimed by the
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AND 2 OTHERS
petitioners. He contended that the deceased and the
injured were being paid a salary of Rs.8,000/- per month
and the vehicle had valid insurance, the insurer is liable to
pay the compensation.
5. The Insurance Company, who was arrayed as
respondent No.2 before the Commissioner admitted the
coverage of the policy, but it was contended that driver
Ashok Chavan was not having valid driving licence and the
one furnished by respondent No.1-owner and the
petitioners i.e., bearing No.MH-01-2003/63414 is a fake
one. In fact, the said driving licence belongs to one
Swapnil Akre. Apart from these contentions, certain other
grounds were also raised by it.
6. The learned Commissioner framed appropriate
issues; clubbed both the petitions and recorded common
evidence. Petitioner No.1 in ECA No.238/2014 was
examined as PW.1 and EXs.P1 to P9 were marked in their
evidence. The petitioner in ECA 239/2014 was examined
as PW.2 and Exs.P10 to P17 were marked in his evidence.
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AND 2 OTHERS
Respondent No.1 was examined as RW.1 and an official of
respondent No.2 was examined as RW.2. Exs.R1 to R7
were marked on their behalf.
7. After hearing both the sides, learned
Commissioner held that, the petitioners in ECA
No.238/2014 claiming compensation for the death of
Ashok Chavan are entitled for a compensation of
8,25,400/- by holding the monthly wages of the deceased
at Rs.8,000/-; the petitioner in ECA No.239/2014 is
entitled for a compensation of Rs.52,300/-. The insurance
company was saddled to pay the compensation amount,
but the interest was ordered to be paid by the owner of
the vehicle.
8. Being aggrieved by the above findings, the
present appeals are filed.
9. In MFA Nos.202366/2018 and 202367/2018,
common substantial question of law has been framed as
below:
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AND 2 OTHERS
"Whether the Commissioner under the
Employees Compensation Act, is justified in
fastening the liability on the appellant -
insurance company, though the owner and
driver of the vehicle colluded together and
produced the fake driving licence by playing
fraud?"
10. In MFA Crob Nos.200008/2019 and
200009/2019, common substantial question of law has
been framed as below:
Whether the Commissioner is justified in
fastening the interest portion of the liability on
the owner of the vehicle?
11. In MFA No.201851/2018, no substantial
question of law would arise for consideration. The
petitioners are contending that the wages of the deceased
considered by the Commissioner at Rs.8,000/- per month
is not proper. It is worth to note that the notification
issued by the Central Government under Section 4 (1B) of
the E.C. Act declares the wages to be Rs.8,000/- per
month. In a catena of decisions, this Court as well as the
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AND 2 OTHERS
various other High Courts have held that in the absence of
any cogent evidence, the wages notified by the Central
Government are to be accepted. In the case on hand also,
the admitted wages by the owner of the vehicle, who is
employer is Rs.8,000/- per month. Therefore, a question
of fact having determined by the Commissioner, is not
available to be questioned before this Court. As such, the
appeal in MFA No.201851/2018 filed by the petitioners in
ECA No.238/2014 is bereft of any merits and is liable to be
dismissed.
12. So far as the substantial question of law raised
in the appeals filed by the Insurance Company i.e., MFA
Nos.202366/2018 and 202367/2018 is concerned, it
is necessary to note that the Insurance Company contends
that the driving licence of deceased Ashok Chavan was a
fake one. It is necessary to note that the registration
certificate of the vehicle driven by deceased Ashok
Chavan, owned by respondent No.1 and insured by
respondent No.2 is produced at Ex.R2. It shows the
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AND 2 OTHERS
unladen weight of the vehicle to be 3800 Kgs. Therefore,
the required licence to drive the said vehicle was an LMV
lilcence. The judgment of the Apex Court in the case of
Mukund Dewangan vs. Oriental Insurance Company
Limited1 lays down that there is no necessity of obtaining
a licnece for transport vehicle in case the unladen weight
of the vehicle is less than 7500 Kgs.
13. A perusal of Ex.R4, which is produced by the
owner of the vehicle shows that deceased Ashok Chavan
had valid driving licence bearing No.KA28 20120015946
and it was valid to drive a transport vehicle from
25.10.2012 to 31.05.2031. Therefore, the said driving
licence was sufficient for the purpose of compliance of
terms and conditions of the policy. It may be true that, the
petitioners had not furnished the said licence to the
Insurance Company. It may also be true that the driving
licence produced at Ex.R1, standing in the name of Ashok
Chavan was informed by RTO, Mumbai to be a fake one as
AIR 2017 (SC) 3668
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AND 2 OTHERS
per the documents produced by the Insurance Company at
Exs.R6 and R7. Obviously, these documents show that the
licence bearing No.MH01/2003/63414 to be in the name of
one Swapnil Akre. Under these circumstances, it is
immaterial whether the driving licence produced by the
petitioners was true or fake. Ex.R4 fully covered the
requirement of the policy and therefore, there cannot be
any ground of collusion of the owner of the vehicle and the
petitioners. It is not necessary to enter into the discussion
about the fake driving licence, as Ex.R4 has greater value
than Exs.R6 and R7, which are not proved as required
under law. This aspect is precisely observed by the learned
Commissioner in para 16 of the impugned judgment.
Consequently, the substantial question of law raised in
these appeals is answered in the affirmative.
14. Regarding the substantial question of law raised
in MFA Crob Nos.200008/2019 and 200009/2019
concerning the interest is concerned, the Apex Court in
two of its judgment has clarified the matter. The Apex
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AND 2 OTHERS
Court, in NEW INDIA ASSURANCE CO. LTD. V.
HARSHADBHAI AMRUTBHAI MODHIYA2 has held as
below.
"4. However, therein a proviso has been added
which reads as under:
"Provided that the insurance granted
hereunder is not extended to include:
(i) any interest and/or penalty imposed on the
insured on account of his/her failure to comply
with the requirements laid down under the WC
Act, 1923, and
(ii) any compensation payable on account of
occupational diseases listed in Part 'C' of Schedule
III of the WC Act, 1923."
XXXXXXXXXX
19. As indicated hereinbefore, a contract of
insurance is governed by the provisions of the
Insurance Act. Unless the said contract is
governed by the provisions of a statute, the
parties are free to enter into a contract as for
their own volition. The Act does not contain a
provision like Section 147 of the Motor Vehicles
Act. Where a statute does not provide for a
compulsory insurance or the extent thereof, it will
bear repetition to state that the parties are free to
(2006) 5 SCC 192
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AND 2 OTHERS
choose their own terms of contract. In that view
of the matter, contracting out, so far as
reimbursement of amount of interest is
concerned, in our opinion, is not prohibited by a
statute.
20. The views taken by us find support from a
recent judgment of this Court in P.J.
Narayan v. Union of India [(2006) 5 SCC 200]
wherein it was held:
"This writ petition is for the purposes of
directing the insurance company to delete the
clause in the insurance policy which provides that
in cases of compensation under the Workmen's
Compensation Act, 1923, the insurance company
will not be liable to pay interest. We see no
substance in the writ petition. There is no
statutory liability on the insurance company. The
statutory liability under the Workmen's
Compensation Act is on the employer. An
insurance is a matter of contract between the
insurance company and the insured. It is always
open to the insurance company to refuse to
insure. Similarly, they are entitled to provide by
contract that they will not take on liability for
interest. In the absence of any statute to that
effect, insurance companies cannot be forced by
courts to take on liabilities which they do not want
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AND 2 OTHERS
to take on. The writ petition is dismissed. No
order as to costs.
XXXXXXXXXXXXXX
24. Section 17 of the Workmen's
Compensation Act voids only a contract or
agreement whereby a workman relinquishes any
right of compensation from the employer for
personal injury arising out of or in the course of
the employment and insofar as it purports to
remove or reduce the liability of any person to
pay compensation under the Act. As my learned
Brother has noticed, in the Workmen's
Compensation Act, there are no provisions
corresponding to those in the Motor Vehicles Act,
insisting on the insurer covering the entire liability
arising out of an award towards compensation to
a third party arising out of a motor accident. It is
not brought to our notice that there is any other
law enacted which stands in the way of an
insurance company and the insured entering into
a contract confining the obligation of the
insurance company to indemnify to a particular
head or to a particular amount when it relates to
a claim for compensation to a third party arising
under the Workmen's Compensation Act. In this
situation, the obligation of the insurance company
clearly stands limited and the relevant proviso
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AND 2 OTHERS
providing for exclusion of liability for interest or
penalty has to be given effect to. Unlike the
scheme of the Motor Vehicles Act the Workmen's
Compensation Act does not confer a right on the
claimant for compensation under that Act to claim
the payment of compensation in its entirety from
the insurer himself. The entitlement of the
claimant under the Workmen's Compensation Act
is to claim the compensation from the employer.
As between the employer and the insurer, the
rights and obligations would depend upon the
terms of the insurance contract. Construing the
contract involved here it is clear that the insurer
has specifically excluded any liability for interest
or penalty under the Workmen's Compensation
Act and confined its liability to indemnify the
employer only against the amount of
compensation ordered to be paid under the
Workmen's Compensation Act. The High Court
was, therefore, not correct in holding that the
appellant Insurance Company, is also liable to pay
the interest on the amount of compensation
awarded by the Commissioner. The workman has
to recover it from the employer.
XXXXXXXXXXX
21. For the reasons aforementioned, the
impugned judgment cannot be sustained. It is set
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AND 2 OTHERS
aside accordingly. The appeal is allowed. The
appellant is not liable for the interest. However,
we make it clear that the employer shall be liable
to pay the amount of interest to the claimant. In
the facts and circumstances of the case, there
shall be no order as to costs."
15. Later, in the decision of KAMLA CHATURVEDI
V. NATIONAL INSURANCE CO.,3 the Apex Court had
the occasion to clarify the proposition laid as below.
"8. In New India Assurance Co. Vs Harshadbhai
case, [(2006) 5 SCC 192] Ved Prakash Garg case [
(1997) 8 SCC 1] was distinguished on facts. It was
observed that in the said case the Court was not
concerned with a case where an accident had
occurred by use of motor vehicle in respect whereof
the contract of insurance will be governed by the
provisions of the Motor Vehicles Act, 1988 (in short
"the MV Act"):
19. ... a contract of insurance is governed by
the provisions of the Insurance Act [, 1938 (in
short 'the Insurance Act')]. Unless the said
contract is governed by the provisions of a
statute, the parties are free to enter into a
contract as [per] their own volition. The Act
(2009) 1 SCC 487
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AND 2 OTHERS
does not contain a provision like Section 147 of
the Motor Vehicles Act. Where a statute does
not provide for a compulsory insurance or the
extent thereof, ... the parties are free to choose
their own terms of contract. In that view of the
matter, contracting out, so far as [the]
reimbursement of amount of interest is
concerned, ... is not prohibited by a statute."
This position has been reiterated in P.J.
Narayan v. Union of India [(2006) 5 SCC 200]. In
the instant case the position is different. The
accident in question arose on account of vehicular
accident and the provisions of the MV Act are
clearly applicable. We have gone through the policy
of insurance and we find that no such exception as
was the case in New India Assurance Co. Vs
Harshadbhai case [(2006) 5 SCC 192] was
stipulated in the policy of insurance. Therefore, the
Insurance Company is liable to pay the interest."
16. Therefore, when the matter stood
distinguished, the liability to pay the interest would be
governed by the terms and conditions in the policy. In the
case one hand, the policy at Ex.R6 would show that it is a
motor vehicle policy and there is no such clause, which
would absolve the Insurance Company from paying the
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AND 2 OTHERS
interest on the compensation amount. Therefore, the
cross objections filed by the owner of the vehicle deserve
to be allowed and he cannot be saddled with the interest.
Accordingly, the substantial question of law raised in these
cross objections is answered in the negative, holding that
the Insurance Company is liable to pay the interest
portion also.
17. In the result, I pass the following:
ORDER
(i) MFA No.201851/2018 filed by the petitioners
and MFA Nos.202366/2018 and 202367/2018
filed by the Insurance Company are hereby
dismissed.
(ii) MFA Crob Nos.200008/2019 and 200009/2019
are allowed. Consequently, the Insurance
Company is held liable to pay the interest
portion also and to that extent, the judgment of
the Commissioner stands modified.
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AND 2 OTHERS
(iii) The amount deposited before this Court, if any,
is ordered to be transmitted to the
Commissioner.
Sd/-
(C M JOSHI)
JUDGE
LG
