Madras High Court
The Divisional Manager vs C.Rajarathinam ... 1St on 3 September, 2024
C.M.A.(MD)No.896 of 2010
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT
Dated : 03.09.2024
CORAM :
THE HONOURABLE MR.JUSTICE SUNDER MOHAN
C.M.A(MD)No.896 of 2010
and M.P(MD)No.1 of 2010
The Divisional Manager,
The New India Assurance Co. Ltd.,
252, Kamarajar Salai,
Madurai. ...Appellant/Respondent No.2
Vs.
1.C.Rajarathinam ... 1st Respondent/Petitioner
2.S.M.Nagarajan ...2nd Respondent/1st Respondent
PRAYER: Civil Miscellaneous Appeal is filed under Section 30 of
Workmen Compensation Act against the award made in W.C.No.192 of
2006 on the file of the Workmen Compensation Commissioner and
Deputy Commissioner of Labour, Madurai.
For Appellant : Mr.N.Dilip Kumar
For R1 : Mr.M.S.Parthiban
for Mr.R.Devaraj
R2 : Dismissed for default
JUDGMENT
The appellant challenges the finding of the Commissioner holding
the appellant liable to pay compensation to the respondent herein.
2. The 1st respondent filed a claim petition stating that while he
was working as a driver under the 2nd respondent herein, he met with an
https://www.mhc.tn.gov.in/judis
accident and sustained grievous injuries; that the accident took place
during the course of employment and hence, the 2nd respondent and the
appellant, being the insurer, are liable to pay compensation.
3. The 2nd respondent remained ex parte before the Tribuna.
4. The appellant filed a counter stating that the insurance policy
stands only in the name of one P.Mariappan and transfer of the vehicle in
the name of the 2nd respondent herein was not intimated to the appellant
and that the appellant is not liable to pay compensation because there is
no privity of contract between the appellant and the 2nd respondent
herein.
5. The claimant examined himself as P.W.1 and the doctor as P.W.2
besides marking Ex.P.1 to Ex.P.10. The appellant examined R.W.1 and
marked Ex.R.1 to Ex.R.3.
6. The Commissioner held that though the vehicle originally was
purchased in the name of one Mariappan, he had transferred the vehicle
in favour of the 2nd respondent herein, which is evidenced by Ex.P.4
https://www.mhc.tn.gov.in/judis
endorsement in the R.C. book; and that by virtue of Section 157 of the
Motor Vehicles Act, the policy of insurance is deemed to have been
transferred in favour of the subsequent transferee, namely, the 2nd
respondent herein.
7. The learned counsel for the appellant submitted that there is no
privity of contract between the 2nd respondent herein and the appellant
inasmuch as the policy stood in the name of the erstwhile owner namely,
P.Mariappan and therefore, the appellant would not be liable to pay
compensation. In support of his contention, he relied upon a judgment of
this Court in United India Insurance Vs. M.Priyasamy and another
reported in 2008 (2) TN MAC 502.
8. The learned counsel for the 1st respondent per contra submitted
that though the insurance policy stood in the name of erstwhile owner
P.Mariappan, the 2nd respondent's name was endorsed in the registration
certificate of the vehicle as the transferee of the vehicle on the date of
accident; that therefore, the judgment relied upon by the learned counsel
for the appellant would not be applicable to the facts of the present case
and in any case, the factual finding of the Commissioner cannot be
https://www.mhc.tn.gov.in/judis
disturbed in the absence of any substantial question of law involved in
the instant appeal.
9. The instant appeal was admitted in the following substantial
question of law:
''Whether the Commissioner is justified in fastening the
liability on the appellant without considering the plea of
the appellant that there is no privity of contract between
the appellant and the employer of the claimant?''
10. The vehicle in question which was involved in the instant
appeal originally belonged to one P.Mariappan, who was the insured as
per the policy Ex.P.4. There is no dispute with regard to the said fact. The
accident took place on 04.07.2006. The vehicle in question was
transferred to the 2nd respondent herein on 18.05.2006 as per Ex.P.3, the
copy of the registration certificate of the vehicle. Therefore, the finding
of the Commissioner that the vehicle was transferred in the name of the
2nd respondent is based on evidence on record and there is no infirmity in
the same. However, the appellant was not informed about the transfer.
https://www.mhc.tn.gov.in/judis
11. In the judgment United India Insurance Vs. M.Priyasamy
and another reported in 2008 (2) TN MAC 502, a learned single Judge
this Court held that where the transfer had been effected after the date of
the accident, it cannot be said that there was privity of contract with the
transferee and the insurance company at the time of the accident.
However, in the instant case, the transfer in the registration certificate
was effected before the accident and merely because the name was not
transferred in the insurance policy, it cannot be said that there was no
privity of contract between the appellant and the 2nd respondent.
12. The Hon'ble Supreme Court, in the case of Mallamma (Dead)
by Lrs. Vs. National Insurance Company Limited and Others,
reported in (2014) 14 SCC 137, held that under similar circumstances,
that since the ownership of the vehicle had been transferred and was
covered under a valid insurance policy, it cannot be said that there is no
privity of contract between the insurer and the insured, in view of the
deeming provision contained in Section 157(1) of the Motor Vehicles
Act, 1988.
13. Therefore, in the facts of the case, this Court is of the view that
https://www.mhc.tn.gov.in/judis
the Commissioner was right in awarding compensation by holding that
the 2nd respondent had a valid insurance policy and the appellant was
liable to pay compensation. The substantial question of law is answered
accordingly and therefore, the award of the Commissioner is confirmed.
14. In the result, this appeal is dismissed. No costs. The first
respondent is permitted to withdraw the compensation amount by filing a
suitable application. Consequently, connected miscellaneous petition is
closed.
03.09.2024
Index : Yes / No
Neutral Citation : Yes / No
CM
To
1.The Workmen Compensation Commissioner and Deputy Commissioner
of Labour, Madurai.
2. The Section Officer,
V.R.Section,Madurai Bench of Madras High Court,
Madurai.
https://www.mhc.tn.gov.in/judis
SUNDER MOHAN, J.
CM
Judgment made in
03.09.2024
https://www.mhc.tn.gov.in/judis
