Orissa High Court

National Insurance Company Ltd vs Sushanta Kumar Dash And Another on 4 May, 2022

     IN THE HIGH COURT OF ORISSA AT CUTTACK

                         MACA No.783 of 2011
[From the judgment dated 30th September, 2011 passed by Shri G.R.
Purohit, OSJS(SB), Member, 2nd MACT, Sambalpur in M.A.C. Case
No.145 of 2008 (S.B.P)]
                             ----------

National Insurance Company Ltd. ......                       Appellant
                                       Versus
Sushanta Kumar Dash and another ......                     Respondents

Advocate(s) appeared in this case :-
       For Appellant             :       Mr. A.P. Dash, Advocate
       For Respondents           :       Mr. A. Pradhan,
                                         Advocate for Respondent No.1


             CORAM : JUSTICE B.P. ROUTRAY

                             JUDGMENT

4th May, 2022 B.P. Routray,J.

1. The present appeal by the insurer is directed against the judgment

dated 30th September, 2011 of learned Member, 2nd MACT, Sambalpur

in M.A.C. Case No.145 of 2008 (S.B.P) wherein compensation to the

tune of Rs.15,00,000/- along with interest @ 7.5% per annum from the

date of filing of the claim application, i.e. 23rd July, 2008 has been

granted on account of injuries sustained by the claimant - Respondent

No.1 in the motor vehicular accident dated 4th April, 2005.

2. The insurer has mainly questioned its limit of liability to

indemnify the compensation amount in respect of the present claimant -

injured.

3. The facts relevant to be stated here are that while the claimant-

injured along with five others were travelling in the offending vehicle,

i.e. car bearing registration number OR-15-F-8727, it dashed against a

tree resulting death of all its occupants including the driver, except

present Respondent No.1 - the claimant. Admittedly, the offending

vehicle was covered on the date of accident with a valid insurance policy

limiting to five occupants including the driver for risk coverage. The

dependents of other such deceased occupants of the vehicle having

preferred different claim applications got their respective compensation

amounts. Treating present injured - Respondent No.1 as 6th occupant of

the vehicle, the compensation in respect of him granted by the Tribunal

has been challenged by the insurer on the ground that the 6th occupant,

who is beyond the permit granted in respect of the vehicle in question, is

not covered within the contract.

4. Thus the simple question involved in the present appeal is,

whether the liability of the 6th occupant travelling in the vehicle beyond

the permission granted and in breach of the conditions of the policy, to

be saddled on the insurer?

5. It is the contention of the learned counsel for the Appellant that,

since six occupants were traveling in the car (offending vehicle) and the

permit was for five occupants only and accordingly the policy coverage

was extended to same five numbers of occupants, the insurer is not

responsible for payment of compensation for any more occupant

exceeding five.

6. In the case of United India Insurance Co. Ltd. v. K.M. Poonam

and Others, (2015) 15 SCC 297, where a large number of occupants

were traveling in a Jeep which had sitting capacity of 6 persons including

the driver, met with the accident and consequent claim applications were

filed, the Hon'ble Supreme Court, after discussion of several case laws,

viz. New India Assurance Company Ltd. v. Satpal Singh & Ors., (2000)

1 SCC 237, New India Assurance Co. Ltd. v. Asha Rani & Ors., (2003)

2 SCC 223, National Insurance Co. Ltd. v. Challa Bharathamma &

Ors., 2004 AIR SCW 5301, National Insurance Co. Ltd. v. Anjana

Shyam & Ors., (2007) 7 SCC 445, National Insurance Co. Ltd. v.

Swaran Singh, (2004) 3 SCC 297, National Insurance Co. Ltd. v. Baljit

Kaur, (2004) 2 SCC, have held as follows:

"37. xx .. xx .. .... As mentioned hereinbefore, in the instant case, the insurance policy taken out by the owner of the vehicle was in respect of six passengers, including the driver, travelling in the vehicle in question. The liability for payment of the other passengers in excess of six passengers would be that of the owner of the vehicle who would be required to compensate the injured or the family of the deceased to the extent of compensation awarded by the Tribunal.

38. Having arrived at the conclusion that the liability of the Insurance Company to pay compensation was limited to six persons travelling inside the vehicle only and that the liability to pay the others was that of the owner, we, in this case, are faced with the same problem as had surfaced in Anjana Shyam case.

39. The number of persons to be compensated being in excess of the number of persons who could validly be carried in the vehicle, the question which arises is one of apportionment of the amounts to be paid. Since there can be no pick and choose method to identify the five passengers, excluding the driver, in respect of whom compensation would be payable by the Insurance Company, to meet the ends of justice we may apply the procedure adopted in Baljit Kaur's case and direct that the Insurance Company should deposit the total amount of compensation awarded to all the claimants and the amounts so deposited be disbursed to the claimants in respect to their claims, with liberty to the Insurance Company to recover the amounts paid by it over and above the compensation amounts payable in respect of the persons covered by the Insurance Policy from the

owner of the vehicle, as was directed in Baljit Kaur's case.

40. In other words, the Appellant Insurance Company shall deposit with the Tribunal the total amount of the amounts awarded in favour of the awardees within two months from the date of this order and the same is to be utilized to satisfy the claims of those claimants not covered by the Insurance Policy along with the persons so covered. The Insurance Company will be entitled to recover the amounts paid by it, in excess of its liability, from the owner of the vehicle, by putting the decree into execution. For the aforesaid purpose, the total amount of the six Awards which are the highest shall be construed as the liability of the Insurance Company. After deducting the said amount from the total amount of all the Awards deposited in terms of this order, the Insurance Company will be entitled to recover the balance amount from the owner of the vehicle as if it is an amount decreed by the Tribunal in favour of the Insurance Company. The Insurance Company will not be required to file a separate suit in this regard in order to recover the amounts paid in excess of its liability from the owner of the vehicle.

7. The facts in the instant case as seen similar to the case of K.M.

Poonam (supra) and in view of the principles so decided by the Hon'ble

Supreme Court, the Appellant - Insurer is held liable to pay the amount

with right to recover the same from the owner. It needs to be mentioned

here that as per submission of both parties the compensation amount in

respect of the claimants of those five deceased occupants have already

been disbursed in their favour and those amounts have been paid by the

present Appellant - insurer on behalf of the owner. In view of such

admitted position, the amount in respect of the present claimant -

Respondent No.1 is thus considered in excess of the liability of the

insurer and so, is liable to be recovered from the owner in appropriate

proceeding.