Madras High Court

Iffco-Tokio General Insurance Company ... vs Ajithkumar ... 1St on 22 December, 2023

                                                                                      C.M.A. No.2132 of 2021


                                   IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                                        DATED : 22.12.2023

                                                             CORAM:

                                    THE HONOURABLE MR. JUSTICE K. RAJASEKAR

                                                    C.M.A. No. 2132 of 2021
                                                  and C.M.P. No.11788 of 2021

                     Iffco-Tokio General Insurance Company Limited,
                     148, Vinayaka Complex, 2nd Floor,
                     Opposite to Ganesh TVS Show Room,
                     Erode, Erode District - 638 011.         ... Appellant / 2nd Respondent

                                                                Vs.

                     1.           Ajithkumar                     ... 1st Respondent/ Petitioner

                     2.           K. Ganesan                     ... 2nd Respondent/ 1st Respondent


                                  Civil Miscellaneous Appeal filed under Section 173 of Motor
                     Vehicles Act, 1988 against the Judgment and decree dated 22.07.2020
                     passed in M.C.O.P. No. 2353 of 2014 on the file of the Special Subordinate
                     Judge, Motor Accident Claims Tribunal, Dharmapuri.


                                  For Appellant     :       Mr. N. Somasundaar
                                  For R1            :       Mr. V.R. Annagandhi
                                  For R2            :       No Appearance



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                                                                                   C.M.A. No.2132 of 2021




                                                         JUDGMENT

This Civil Miscellaneous appeal has been filed by the insurance

company challenging the Judgment and Decree passed in M.C.O.P. No.

2353 of 2014, dated 22.07.2020 on the file of the Special Subordinate

Judge, Motor Accident Claims Tribunal, Dharmapuri, wherein the Tribunal

has awarded a compensation for a sum of Rs.1,28,791/- along with interest

@ 7.5% per annum.

2. For the sake of convenience, the parties are referred herein

according to their litigative status and rank before the Tribunal.

3. On 24.06.2012, at about 13:00 hours, the claimant minor

Ajeethkumar was walking in the main road of Chinnampalli to Mecheri on

the left hand side of the road, while he reached near Perumbalai Aditya

Petrol Bunk, a Hero Honda more cycle bearing Registration No.TN-52-Y-

2025, ridden by its rider in a rash and negligent manner, without sounding

horn and following traffic rules, dashed against the claimant, thereby

causing grievous injuries. The claimant was immediately taken to "Kurinji

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Hospital, Salem for treatment. A criminal case was registered against the

rider of the Hero Honda motorcyle in Cr.No.92/2012 U/s. 279 and 338 of

IPC, 1860 on the file of Perumbalai Police Station. For the injuries

sustained, the claimant has filed claim petition seeking compensation for a

sum of Rs.5,00,000/- under section 166 of the Motor Vehicles Act, 1988.

4. The first respondent, who is the rider cum owner of the Hero

Honda motor cycle has not contested the claim and remained ex-parte. The

second respondent - insurance company has filed a counter and disputed the

manner in which the accident has taken place and contended that the

accident has taken place only due to the negligence on the part of the

claimant, who has suddenly crossed the road, without minding the horn

sound and due to shouting of public around there, he instantly turned back

lost his balance, slipped and fell down, hence the first respondent has not hit

against the claimant. The insurance company also stated that the first

respondent has no valid driving licence at the time of accident, hence there

is a statutory violation of policy conditions, hence the second respondent

insurance company is not liable to pay compensation.

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5. Before the Tribunal, on the side of the claimant, P.W.1 was

examined and Exs.P.1 to P.10 were marked. On the side of the second

respondent - insurance company, R.W.1 was examined and Ex.R.1 was

marked and the disability certificate of the claimant is marked as Ex.C.1.

6. Based on the evidence placed on record, the Tribunal in point

nos.1 and 2, has held that the first respondent is the tortfeasor and the

second respondent - insurance company as the insurer of the said vehicle is

liable to indemnify the first respondent and to pay compensation to the

claimant. In point no.3, the Tribunal has quantified and granted

compensation for a sum of Rs.1,28,791/- along with interest @ 7.5% per

annum from the date of filing of petition till the date of realization.

7. Aggrieved over the award, the insurance company has filed this

appeal challenging the liability fixed on them to indemnify the first

respondent.

8. The learned counsel for the insurance company submitted that

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the first respondent, who is the owner of the Hero Honda motorcycle is a

tortfeasor and he was not having a valid driving licence at the time of

accident, but the Tribunal has not properly appreciated the same and fixed

the liability on the insurance company to pay the compensation, hence prays

to set aside the award of the Tribunal.

9. The learned counsel for the claimant submitted that the

Tribunal based on the evidence placed on record, has held that the insurance

policy of the offending vehicle was in force at the time of accident, and

fixed the liability on the part of the insurance company and directed to pay

the compensation, hence prays to confirm the award.

10. I have considered the submissions made on both sides and

perused the materials available on record.

11. Admittedly, in this case, the claimant herein is a third party,

who sustained injuries in the accident, which was taken place due to

tortuous act of the first respondent. Before the Tribunal, Ex.P.7 - insurance

policy of the offending vehicle was marked and based on that the Tribunal

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has held that the insurance coverage was in force at the time of accident,

hence fixed the liability on the the second respondent - insurance company

to indemnify the first respondent and to pay compensation.

12. The major contention of the insurance company is that the first

respondent has no valid driving licence at the time of accident and to

substantiate the same, the insurance company has examined R.W.1 - Record

Clerk of RTO, Sankagiri, who has stated that since no licence particulars

given, he is not able to give licence details of first respondent. He has

manually verified records and was not able to find licence details. The

Tribunal based on the evidence of R.W.1 and Ex.R.1 has rejected the

contention of the insurance company and fixed the liability on them.

13. Before the Tribunal, the first respondent, who is a tortfeasor,

has not come forward to produce his driving licence and the evidences

adduced by the second respondent - insurance company shows that, the first

respondent has not been issued valid driving licence at the time of accident

from the Office of R.T.O, Sankari. The fact that R.W.1 was not able to find

any licence details only mean that there was no licence issued and if any

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licence is issued, definitely the Official could give licence particulars. By

improperly interpreting the evidence of R.W.1, the Tribunal has held that

there is no breach of terms and conditions as per the policy and fixed the

liability on the second respondent - insurance company. The approach of

the Tribunal is not proper since, the insurance company has rightly

examined the R.W.1 – Official of R.T.O, to prove the fact that, there is no

licence issued in favour of first respondent. According to him, he is not able

to find any details about the issuance of licence from his official record and

the evidence of R.W.1 is sufficient to hold that there is no licence issued to

the first respondent.

14. This Court in M. Ananthi and Ors. Vs. P. Venkatesan and

Ors. [2022 (1) TNMAC 135], by following the r of the Hon'ble Apex Court

judgment in National Insurance Co. Ltd. vs. Swaran Singh and Ors.

[MANU/SC/0021/2004 : AIR 2004 SC 1531] and held in paragraph no.12

as follows:

"In National Insurance Co. Ltd. vs. Swaran Singh (cited supra), three judges bench of the Hon'ble Supreme court, laid down guidelines in case of claims resisted on the ground of breach of policy condition as below:-

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"The summary of our findings to the various issues as raised in these petitions are as follows:-

(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.

(ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the said Act.

(iii) The breach of policy condition e.g., disqualification of driver on invalid driving licence of the driver, as contained in Sub-section (2)(a)

(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time.

(iv) The Insurance Companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle;

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the burden of proof wherefor would be on them.

(v) The Court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstances of the case.

(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under Section 149(2) of the Act.""

15. In S. Iyappan vs. United India Insurance Co. Ltd.,

(MANU/SC/0632/2013 : 2013 (7) SCC 62), the Hon'ble Supreme Court has

observed that:-

"18. Reading the provisions of Sections 146 and 147 of the Motor Vehicles Act, it is evidently clear that in certain circumstances the insurer's right is safeguarded but in any event the insurer has to pay compensation when a valid certificate of insurance is issued notwithstanding the fact that the insurer may proceed against the insured for recovery of the amount. Under Section 149 of the Motor Vehicles Act, the insurer can defend the action inter alia on

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the grounds, namely, (i) the vehicle was not driven by a named person, (ii) it was being driven by a person who was not having a duly granted licence, and (iii) person driving the vehicle was disqualified to hold and obtain a driving licence. Hence, in our considered opinion, the insurer cannot disown its liability on the ground that although the driver was holding a licence to drive a light motor vehicle but before driving light motor vehicle used as commercial vehicle, no endorsement to drive commercial vehicle was obtained in the driving licence. In any case, it is the statutory right of a third party to recover the amount of compensation so awarded from the insurer. It is for the insurer to proceed against the insured for recovery of the amount in the event there has been violation of any condition of the insurance policy.”

16. Based on the above observations, this Court is consistently

following the guidelines of the National Insurance Co. Ltd. vs. Swaran

Singh and Ors. cited supra, apply the principle of “Pay and Recover” for the

case of third party claim. Considering the case in hand, this Court is of the

view that adopting the principle of “Pay and Recover” is proper.

Accordingly, the insurance company is directed to pay the compensation

awarded by the Tribunal to the claimant and given liberty to recover the

same from the first respondent.

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17. In the result, this Civil Miscellaneous Appeal is allowed.

Consequently, connected civil miscellaneous petition stands closed. No

cost.