Madras High Court
The Branch Manager vs K.Jagan @ Jagankumar on 1 March, 2021
C.M.A.No.2179 of 2013
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 01.03.2021
CORAM:
THE HON'BLE Mr. JUSTICE D.KRISHNAKUMAR
CMA. No.2179 of 2013
The Branch Manager,
United India Insurance Co. Ltd.,
Vellore ... Appellant
..Vs..
1. K.Jagan @ Jagankumar
2. M. Navalkumar ... Respondents
Appeal filed under Section 173 of the Motor Vehicles Act, 1988,
against the Judgement and decree dated 13.02.2012 made in
M.C.O.P.No. 303 of 2010 on the file of the Motor Accidents Claims
Tribunal (Additional District Judge/Fast Track Court), Tirupattur.
For Appellant : Mr.D.Bhaskaran
For Respondents : Mr.P.A.Sudesh Kumar - R1
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C.M.A.No.2179 of 2013
JUDGMENT
The matter is heard through "Video Conferencing".
Dissatisfied with the award passed by the tribunal,
dated13.02.2012 made in M.C.O.P.No. 303 of 2010, the Insurance
Company has preferred the present appeal challenging fastening
liability against the Insurance Company.
2. It is the case of the claimants that on 19.04.2007 at about
7pm near the claimant was travelling as pillion rider in Hero Honda
Motor Cycle bearing registration No. TN04-A-7947 belonging to the 2nd
respondent. While the said motorcycle was proceeding near
Palnangkuppam Junction Road in between Jolarpettai – Tirupattur, the
rider Hero Honda Motor Cycle rode the same in a very rash and
negligent manner and dashed against one person namely Samynathan
who was proceeding on the extreme left side of the road in the
opposite direction in his bicycle. Due to impact the claimant who was
travelling in the said motor cycle as pillion rider and said cyclist were
sustained grievous and multiple injuries. Immediately after the
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C.M.A.No.2179 of 2013
accident the claimant and said injured Samynathan were taken to
Government Hospital, Tirupattur. The claimant sustained grievous
injuries on the left side ear, left side head and all over the body and
became permanently disabled. Hence, for the injuries sustained by
him, filed a claim petition claiming as sum of Rs.3,00,000/- as
compensation. The Tribunal upon evaluation of materials placed, has
fixed the negligence on the rider of the two wheeler and awarded a
sum of Rs.81,200/-under various heads to the claimant payable by the
Insurance Company being insurer of the vehicle.
3. Before the Tribunal, the 1st respondent examined him as P.W.1
and doctor was examined as PW2 and marked documents ExP1 to P13.
No witness and documents were marked on the side of the
Appellant/Insurance Company.
4. Challenging the said award, the Insurance Company has filed
the present appeal on the ground that the Insurance Company is not
statutorily required to cover the liability in respect of unauthorised
passenger.
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C.M.A.No.2179 of 2013
5. The learned counsel for the appellant/Insurance Company
submitted that policy marked as Ex.P11 on the side of the claimant is a
‘Liability Only’ Policy, the Insurance Company owned no liability
towards the gratuitous passengers. Further, the tribunal failed to note
that the said insurance policy was a ‘Statutory Policy’ and the same did
not cover the risk or death or bodily injury to gratuitous passengers.
The main ground raised in the appeal is that the liability can be
determined only on the basis of the premium collected and in the
absence of additional premium; the Insurance Company cannot be
made liable.
6. It is further submitted by the learned counsel for the
appellant that the claimant/1st respondent had travelled as a pillion
rider and since no additional premium was paid to cover pillion rider,
the appellant/insurance company is not liable to pay the compensation
of Rs.81,200/- awarded by the tribunal. Hence prayed to set aside the
liability fastened against the appellant/Insurance Company.
7. Per contra, the learned counsel appearing for the 1st
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C.M.A.No.2179 of 2013
respondent/claimant has submitted that the tribunal has rightly
observed that the claimant has no direct contract with the insurance
company, therefore the claimant can be treated as ‘third party’ and as
per the policy condition, the insurance company is liable to pay
compensation. Therefore, the liability fastened on the appellant
/insurance company does not require any interference by this Court.
8. The learned counsel for the 1st respondent/claimant further
submitted that the disability sustained by the claimant was proved
before the tribunal through Ex.P13/Disability Certificate. The tribunal
after assessment of records, has fixed the disability at 30% and by
taking Rs.1750/- per percentage, the awarded the sum of Rs.52,500/-
towards disability, which is fair and reasonable. The compensation
awarded by the tribunal under other heads also does not require any
modification. The appeal preferred by the Insurance Company is liable
to be dismissed.
9. Heard the learned counsel appearing for the
appellant/Insurance Company and the 1st respondent/claimant and
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C.M.A.No.2179 of 2013
perused the materials available on record.
10. Having considered the rival submissions made by the
counsels and on evaluation documents, the following issues are to be
decided in the appeal;
i. Whether the claimant who is a pillion rider can be treated
as third party , if so,
ii. Whether, the said policy covers the pillion rider in the
absence of the payment for additional premium.
11. In terms of Section 147 of the Act only in regard to
reimbursement of the claim to a third party, a contract of insurance
must be taken by the owners of the vehicle. It is imperative in nature.
When, however, an owner of a vehicle intends to cover himself from
other risks; it is permissible to enter into a contract of insurance in
which event the insurer would be bound to reimburse the owner of the
vehicle strictly in terms thereof.
12. The liability of the insurer to reimburse the owner in respect
of a claim made by the third party, thus, is statutory whereas other
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C.M.A.No.2179 of 2013
claims are not.
13. The only question which, therefore, arises for consideration is
as to whether the pillion rider on a scooter would be a third party
within the meaning of Section 147 of the Act. Indisputably, a
distinction has to be made between a contract of insurance in regard to
a third party and the owner or the driver of the vehicle.
14. At this point, it is useful to rely upon the decision of the
Hon’ble Supreme Court in the case law reported in 2008(2) TNMAC 16
(SC) in the case of Oriental Insurance Company Limited Vs.
Sudhamaran K.V and Others.The relevant portion is extracted below;
“14. The provisions of the Act and, in
particular, Section 147 of the Act were enacted for the
purpose of enforcing the principles of social justice.
It, however, must be kept confined to a third party
risk. A contract of insurance which is not statutory in
nature should be construed like any other contract.
15. We have noticed the terms of the contract of
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C.M.A.No.2179 of 2013
insurance. It was entered into for the purpose of
covering the third party risk and not the risk of the
owner or a pillion rider. An exception in the contract
of insurance has been made, i.e., by covering the risk
of the driver of the vehicle. The deceased was,
indisputably, not the driver of the vehicle.
16. The contract of insurance did not cover the owner
of the vehicle, certainly not the pillion rider. The
deceased was travelling as a passenger, stricto sensu
may not be as a gratuitous passenger as in a given
case she may not be a member of the family, a friend
or other relative. In the sense of the term which is
used in common parlance, she might not be even a
passenger.
In view of the terms of the contract of insurance,
however, she would not be covered thereby.
…..
19. The law which emerges from the said decisions, is:
(i) the liability of the insurance company in a case of
this nature is not extended to a pillion rider of the
motor vehicle unless the requisite amount of premium
is paid for covering his/her risk (ii) the legal
obligation arising under Section 147 of the Act cannot
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C.M.A.No.2179 of 2013
be extended to an injury or death of the owner of
vehicle or the pillion rider; (iii) the pillion rider in a
two wheeler was not to be treated as a third party
when the accident has taken place owing to rash and
negligent riding of the scooter and not on the part of
the driver of another vehicle.
20. For the views we have taken, it is not necessary to
refer to a large number of decisions cited at the Bar as
they are not applicable in a case of this nature.
21. For the reasons aforementioned, the impugned
judgment cannot be sustained. It is set aside
accordingly. The appeal is allowed. No costs”
15. In Dr.T.V.Jose Vs.Chacko P.M @ Thankachan and Others
reported in (2001) 8 SCC 748, the learned Judge had an occasion to
survey the law with regard to the liability of insurance companies in
respect of gratuitous passengers. After referring to a number of
decisions of this Court the learned Judge observed (vide para 20) “the
law on this subject is clear, a third party policy does not cover liability
to gratuitous passengers who are not carried for hire or reward, the
insurer company was held not liable to reimburse the appellant. The
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C.M.A.No.2179 of 2013
relevant paragraph is extracted hereunder;
“ 20. Sections 95(a) and 95(b)(i) of the Motor Vehicles
Act adopted the provisions of the English Road Traffic
Act, 1960, and excluded the liability of the insurance
company regarding the risk to the passengers. Section
95 provides that a policy of insurance must be a policy
which insures the persons against any liability which
may be incurred by him in respect of death or bodily
injury to any person or damage to any property of a
third party caused by or arising out of the use of the
vehicle in a public place. The plea that the words "third
party" are wide enough to cover all persons except the
person and the insurer is negatived as the insurance
cover is not available to the passengers made clear by
the proviso to sub-section which provides that a policy
shall not be required:
(ii) except where the vehicle is a vehicle in which
passengers are carried for hire or reward or by reason
of or in pursuance of a contract of employment, to cover
liability in respect of the death of or bodily injury to
persons being carried in or upon or entering or
mounting or alighting from the vehicle at the time of the
occurrence of the event out of which a claim arises.
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Therefore it is not required that a policy of insurance
should cover risk to the passengers who are not carried
for hire or reward. As under Section 95 the risk to a
passenger in a vehicle who is not carried for hire or
reward is not required to be insured the plea of the
counsel for the insurance company will have to be
accepted and the insurance company held not liable
under the requirements of the Motor Vehicles Act.”
16. The Full Bench of this Court in UNITED INDIA
INSURANCE COMPANY VS. NAGAMMAL AND OTHERS reported in
2009 (1) CTC 2 has held as follows:
“31.Thus from an analysis of the
statutory provisions as explained by the
Supreme Court in various decisions rendered
from time to time, the following pictures
emerges:
(i)The Insurance Policy is required to cover the
liability envisaged under Section 147, but wider
risk can always be undertaken.
(ii)Section 149 envisages the defences which
are open to the Insurance Company. Where the
Insurance Company is not successful in its
defence, obviously it is required to satisfy the
decree and the award. Where it is successful in
its defence, it may yet be required to pay the
amount to the claimant and thereafter recover
the same from the owner under such
circumstance envisaged and enumerated in
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C.M.A.No.2179 of 2013
Section 149(4) and Section 149(5).
(iii)Under Section 147 the Insurance Company
is not statutorily required to cover the liability
in respect of a passenger in a goods vehicle
unless such passenger is the owner or agent of
the owner of the goods accompanying such
goods in the concerned goods vehicle.
(iv)Since there is no statutory requirement to
cover the liability in respect of a passenger in a
goods vehicle, the principle of “pay and
recover”, as statutorily recognised in Section
149(4) and Section 149(5), is not applicable
ipso facto to such cases and, therefore,
ordinarily the Court is not expected to issue
such a direction to the Insurance Company to
pay to the claimant and thereafter recover from
the owner.
(v)Where, by relying upon the decision of the
Supreme Court in Satpal Singh's case, either
expressly or even by implication, there has
been a direction by the Trial Court to the
Insurance Company to pay, the Appellate Court
is obviously required to consider as to whether
such direction should be set aside in its entirety
and the liability should be fastened only on the
driver and the owner or whether the Insurance
Company should be directed to comply with the
direction regarding payment to the claimant
and recover thereafter from the owner.
(vi)No such direction can be issued by any Trial
Court to the Insurance Company to pay and
recover relating to liability in respect of a
passenger travelling in a goods vehicle after the
decision in Baljit Kaur's case merely because
the date of accident was before such decision.
The date of the accident is immaterial. Since
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the law has been specifically clarified, no Trial
Court is expected to decide contrary to such
decision.
(vii)Where, however, the matter has already
been decided by the Trial Court before the
decision in Baljit Kaur's case. It would be in
the discretion of the Appellate Court, depending
upon the facts and circumstances of the case,
whether the doctrine of “pay and recover”
should be applied or as to whether the claimant
would be left to recover the amount from the
person liable i.e., the driver or the owner, as
the case may be.“
17. In THE MANAGER, IFFCO – TOKYO GENERAL
INSURANCE CO. LTD., V.G.RAMESH, (2012 (1) TN MAC 820) this
Court referring Asha Rani's case and other judgments, has held as
follows:-
“......the question as to whether the
Insurance Company is statutorily liable to
cover the liability in respect of risk of
gratuitous passenger, is clearly laid down by
Hon'ble Apex Court in Asha Rani's case by
reversing the earlier decision in Saptal
Singh's case and further question as to
whether the doctrine of “Pay and Recover”
theory, which is applied till then, by directing
the Insurer to satisfy the award and to
recover the amount from the insured even
though the Insurer was not statutorily
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C.M.A.No.2179 of 2013
required to cover the liability in respect of
such passengers carried in goods vehicle, is
clarified in Full Bench judgment of our High
Court. As per which, after the decision of
Baljit Kaur's case rendered on 06.01.2004
no such direction can be issued by the Trial
Court to the Insurance Company on the
principle of “Pay and Recover” relating to the
liability in respect of risk of gratuitous
passengers traveling in a goods vehicle and
no Trial Court is expected to decide contrary
to the decision made thereon.”
18. In view of the rulings cited above and considering facts and
circumstances of the present case on hand, this Court is of the
considered view that since, the policy is only an Act policy issued by
the appellant Insurance company to the insurer and the injured
claimant/1st respondent only an occupant of the rider of the motor
cycle, cannot be considered as 'third party' of the vehicle and the
policy is covered risks to the third party alone. The doctrine of pay and
recovery also cannot be applied to the facts of the case, since the
appellant Insurance company is not liable to pay the compensation in
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C.M.A.No.2179 of 2013
view of the aforesaid decision.
19. In view of the dictum laid down by the Hon'ble Supreme
Court and taking note of the judgments of this Court, this Court holds
that since the Act policy did not cover the risk, the
Appellant/Insurance Company is not liable to pay any compensation to
the claimant. Accordingly, the award against the appellant/Insurance
Company is set aside. It is open to the claimant to recover the
compensation amount from the owner of the vehicle in the manner
known to law. No costs. Connected miscellaneous petition is closed.
The Civil Miscellaneous Appeal is allowed.
01.03.2021
Index: Yes/No
Internet: Yes
Speaking/Non Speaking order
ak
To
1.The Additional District Judge/Fast Track Court), Tirupattur.
2. The Section Officer, V.R.Section, Madras High Court, Chennai-104.
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C.M.A.No.2179 of 2013
D.KRISHNAKUMAR, J.
ak
CMA. No.2179 of 2013
01.03.2021
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