Orissa High Court

M/S. Icici Lombard General vs Chanchala Putel & Ors on 24 July, 2025

        IN THE HIGH COURT OF ORISSA AT CUTTACK

                        MACA No. 436 of 2023

       From the Judgment/Order dated 27.12.2022 passed by the
    learned Addl. Dist. Judge-cum-7th MACT, Kantabanji in MAC
    Case No.01 of 2021.

    M/s. ICICI Lombard General                   ::::         Appellant
    Insurance Co. Ltd.
                                          -:: VERSUS ::-

    Chanchala Putel & Ors.                      ::::        Respondents


    For Appellant           ::::   Mr. A. Dash, Advocate

    For Respondents         ::::   Mr. D.R. Swain, Advocate
                                   (Respondent Nos. 1 to 3)

                                   .........

PRESENT :

THE HON'BLE MR. JUSTICE BIRAJA PRASANNASATAPATHY

---------------------------------------------------------------------------------- Date of Hearing- 24.07.2025:: Date of Judgment- 24.07.2025

---------------------------------------------------------------------------------- B.P. Satapathy, J. This matter is taken up through Hybrid

Arrangement (Virtual/Physical) Mode.

2. Heard Mr. A. Dash, learned counsel appearing for the Appellant-

Company and Mr. D.R. Swain, learned counsel appearing for

Respondent Nos. 1 to 3.

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3. The present appeal has been filed by the Appellant-Company

challenging Judgment dtd.27.12.2022 so passed by the learned

Addl. District Judge-cum-7th MACT, Kantabanji in MAC Case No.

01 of 2021. Vide the said Judgment the Tribunal assessed the

compensation at Rs.9,04,040/- along with interest @ 7% per annum

payable from the date of filing of the claim application till its

realization.

4. While assailing the award, learned counsel appearing for the

Appellant-Company contended that since the deceased who was the

owner of the offending motorcycle bearing Registration No. OD-03-

K-0984 died in the accident because of the rash and negligent

driving of the driver of the insured vehicle and no other vehicle was

involved in causing the accident, the claim application filed by the

Claimants seeking grant of compensation under Sec. 166 of M.V.

Act, 1988 (in short 'Act') was not maintainable. But the Tribunal

failed to appreciate the same while allowing the claim application

vide the impugned judgment.

4.1. It is contended that R.C. book of the offending vehicle exhibited

vide Ext. 10, clearly shows that the deceased was the owner of the

offending motorcycle and since the deceased died due to rash and

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negligent driving of the driver of the motor cycle at the time of

accident i.e. Respondent No. 4, the claim application should have

been dismissed as having not maintainable under Sec. 166 of the

M.V. Act.

4.2. In support of his aforesaid submission reliance was placed to a

decision of the Hon'ble Apex Court reported in (2008) 7 SCC 428

(Oriental Insurance Company Limited Vs. Sudhakaran K.V. &

Ors.). Hon'ble Apex Court in Para 15, 16, 20, 21 & 25 of the said

Judgment has held as follows:-

"15. The only question which, therefore, arises for our 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.

16. 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.

*** *** ***

20. 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.

21. We have noticed the terms of the contract of 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

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vehicle. The deceased was, indisputably, not the driver of the vehicle.

*** *** ***

25. 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 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."

4.3. It is further contended that similar view taken by this Court in

its Judgment dtd.18.02.2019 in MACA Nos. 1358 & 1425 of 2015.

This Court in Para 10 to 13 & 17 of the said decision has held as

follows:-

"10. In Ningamma, the deceased was travelling in Hero Honda motor cycle, which he borrowed from the real owner. When the said motor cycle was proceeding on Ilkal-Kustagl, National Highway, a bullock cart proceeding ahead of the said motor cycle carrying iron sheet suddenly stopped and consequently deceased Ramappa who was proceeding on the said motor cycle dashed against it. Consequent to the aforesaid incident, he sustained fatal injuries over his vital part of body and on the way to Government hospital he died. The widow and son of the deceased filed an application under Sec.163A of the M.V Act before the Tribunal claiming compensation. Learned Tribunal awarded compensation. The insurance company preferred first appeal before the High Court on the ground that the accident occurred due to the fault of the

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deceased and the claim application was not maintainable as Sec.163A of the M.V Act is not applicable unless there was another vehicle involved in the accident. The High Court allowed the appeal holding that the claim application was not maintainable as there was no tort-feasor involved. Review application filed by the claimants was dismissed. The matter travelled to the apex Court. The question arose before the apex Court is whether the legal representatives of a person, who was driving a motor vehicle, after borrowing it from the real owner meets with an accident without involving any other vehicle, would be entitled to compensation under Sec.163A of the M.V Act or under any other provisions of law and also whether the insurer who issued the insurance policy would be bound to indemnify the deceased or his legal representatives? The apex Court held that the legal representatives of the deceased who have stepped into the shoes of the owner of the motor vehicle could not have claimed compensation under Section 163-A of the M.V Act. It was held that undoubtedly, Section 166 of the M.V Act deals with "Just Compensation" and even if in the pleadings no specific claim was made under Section 166 of the M.V Act, a party should not be deprived from getting "Just Compensation" in case the claimant is able to make out a case under any provision of law. The M.V Act is beneficial and welfare legislation. In fact, the court is duty bound and entitled to award "Just Compensation" irrespective of the fact whether any plea in that behalf was raised by the claimant or not. However, whether or not the claimants would be governed by the terms and conditions of the insurance policy and whether or not the provisions of Section 147 of the M.V Act would be applicable in the present case and also whether or not there was rash and negligent driving on the part of the deceased, are essentially a matter of fact which was required to be considered and answered at least by the High Court. The matter was remitted back to the High Court.

11. In Dhanraj, the appellant along with certain other persons was travelling in his own jeep. The jeep met with an accident. In the accident, the appellant as well as other passengers received injuries. A number of claim petitions came to be filed. The appellant also filed a claim petition. The Tribunal held that the

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driver of the jeep responsible for the accident. In all the claim petitions filed by other passengers, the Tribunal directed that the appellant (as the owner) as well as the driver and insurance company were liable to pay compensation. In the claim application filed by the appellant, the Tribunal directed the driver and the insurance company to pay compensation to the appellant. The insurance company filed appeal before the High Court. The same was allowed. It was held that the appellant was the owner of the vehicle, the insurance company is not liable to pay him any compensation. The apex Court held that that the policy had not covered any risk for injury to the owner himself. The premium was paid towards damage to the vehicle and not for injury to the person of the owner. An owner of a vehicle can only claim provided a personal accident insurance has been taken out. In that case, there was no such insurance. The appeal was allowed.

12. In Sadanand Mukhi, the first respondent was owner of a motor cycle. The vehicle was insured with the appellant company for the period 9.9.1999 and 8.9.2000. On 8th September, 2000, Tasu Mukhi, son of the insured, while driving the motor cycle met with an accident and died. The accident allegedly took place as a stray dog came in front of the vehicle. A First Information Report was also lodged. Respondents filed a claim petition. Amongst them, first respondent, who is the owner of the insured vehicle, was the applicant. The insurer appellant raised a specific contention that keeping in view the relationship between the deceased and the owner of the motor vehicle i.e. father and son, he was not a third party. The apex Court held:

"15. Contract of insurance of a motor vehicle is governed by the provisions of the Insurance Act. The terms of the policy as also the quantum of the premium payable for insuring the vehicle in question depends not only upon the carrying capacity of the vehicle but also on the purpose for which the same was being used and the extent of the risk covered thereby. By taking an `act policy', the owner of a vehicle fulfils his statutory obligation as contained in Section 147 of the Act. The liability of the insurer is either statutory or contractual. If it is contractual its liability extends to the risk covered by the policy of insurance. If

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additional risks are sought to be covered, additional premium has to be paid. If the contention of the learned counsel is to be accepted, then to a large extent, the provisions of the Insurance Act become otiose. By reason of such an interpretation the insurer would be liable to cover risk of not only a third party but also others who would not otherwise come within the purview thereof. It is one thing to say that the life is uncertain and the same is required to be covered, but it is another thing to say that we must read a statute so as to grant relief to a person not contemplated by the Act. It is not for the court, unless a statute is found to be unconstitutional, to consider the rationality thereof. Even otherwise the provisions of the Act read with the provisions of the Insurance Act appear to be wholly rational.

16. Only because driving of a motor vehicle may cause accident involving loss of life and property not only of a third party but also the owner of the vehicle and the insured vehicle itself, different provisions have been made in the Insurance Act as also the Act laying down different types of insurance policies. The amount of premium required to be paid for each of the policy is governed by the Insurance Act. A statutory regulatory authority fixes the norms and the guidelines.

17. Keeping in view the aforementioned Parliamentary object, let us consider the fact of the present case so as to consider as to whether the insurer is liable to pay the amount of compensation in relation to the accident occurred by use of the vehicle which was being driven by the son of the insured.

18. We may, for the said purpose, notice certain decisions covering different categories of the claims.

In United India Insurance Co. Ltd. v. Tilak Singh, [(2006) 4 SCC 404] this Court considered the provisions of the Motor Vehicles Act, 1939 as also 1988 Act and inter alia opined that the insurance company would have no liability towards the injuries suffered by the deceased who was a pillion rider, as the insurance policy was a statutory policy which did not cover the gratuitous passenger.

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In Oriental Insurance Co. Ltd. v. Jhuma Saha, [(2007) 9 SCC 263 ], it was held :-

"10. The deceased was the owner of the vehicle. For the reasons stated in the claim petition or otherwise, he himself was to be blamed for the accident. The accident did not involve motor vehicle other than the one which he was driving. The question which arises for consideration is that the deceased himself being negligent, the claim petition under Section 166 of the Motor Vehicles Act, 1988 would be maintainable.

11. Liability of the insurer Company is to the extent of indemnification of the insured against the respondent or an injured person, a third person or in respect of damages of property. Thus, if the insured cannot be fastened with any liability under the provisions of the Motor Vehicles Act, the question of the insurer being liable to indemnify the insured, therefore, does not arise." It was furthermore held :-

"13. The additional premium was not paid in respect of the entire risk of death or bodily injury of the owner of the vehicle. If that be so, Section 147(b) of the Motor Vehicles Act which in no uncertain terms covers a risk of a third party only would be attracted in the present case." The matter came up for consideration yet again in Oriental Insurance Co. Ltd. [(2007) 5 SCC 428] wherein it was observed :-

"13. As we understand Section 147(1) of the Act, an insurance policy thereunder need not cover the liability in respect of death or injury arising out of and in the course of the employment of an employee of the person insured by the policy, unless it be a liability arising under the Workmen's Compensation Act, 1923 in respect of a driver, also the conductor, in the case of a public service vehicle, and the one carried in the vehicle as owner of the goods or his representative, if it is a goods vehicle. It is provided that the policy also shall not be required to cover any contractual liability. Uninfluenced by authorities, we find no difficulty in understanding this provision as one providing that the policy must insure an owner against any

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liability to a third party caused by or arising out of the use of the vehicle in a public place, and against death or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of vehicle in a public place.

The proviso clarifies that the policy shall not be required to cover an employee of the insured in respect of bodily injury or death arising out of and in the course of his employment. Then, an exception is provided to the last foregoing to the effect that the policy must cover a liability arising under the Workmen's Compensation Act, 1923 in respect of the death or bodily injury to an employee who is engaged in driving the vehicle or who serves as a conductor in a public service vehicle or an employee who travels in the vehicle of the employer carrying goods if it is a goods carriage. Section 149(1), which casts an obligation on an insurer to satisfy an award, also speaks only of award in respect of such liability as is required to be covered by a policy under clause (b) of sub- section (1) of Section 147 (being a liability covered by the terms of the policy). This provision cannot therefore be used to enlarge the liability if it does not exist in terms of Section 147 of the Act.

14. The object of the insistence on insurance under Chapter XI of the Act thus seems to be to compulsorily cover the liability relating to their person or properties of third parties and in respect of employees of the insured employer, the liability that may arise under the Workmen's Compensation Act, 1923 in respect of the driver, the conductor and the one carried in a goods vehicle carrying goods. On this plain understanding of Section 147, we find it difficult to hold that the Insurance Company, in the case on hand, was liable to indemnify the owner, the employer Company, the insured, in respect of the death of one of its employees, who according to the claim, was not the driver. Be it noted that the liability is not one arising under the Workmen's Compensation Act, 1923 and it is doubtful, on the case put forward by the claimant, whether the deceased could be understood as a workman coming within the Workmen's Compensation Act,

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1923. Therefore, on a plain reading of Section 147 of the Act, it appears to be clear that the Insurance Company is not liable to indemnify the insured in the case on hand." The said principle was reiterated in United India Insurance Co. Ltd. v. Davinder Singh, [ (2007) 8 SCC 698 ] holding :-

"10. It is, thus, axiomatic that whereas an insurance company may be held to be liable to indemnify the owner for the purpose of meeting the object and purport of the provisions of the Motor Vehicles Act, the same may not be necessary in a case where an insurance company may refuse to compensate the owner of the vehicle towards his own loss. A distinction must be borne in mind as regards the statutory liability of the insurer vis-a- vis the purport and object sought to be achieved by a beneficent legislation before a forum constituted under the Motor Vehicles Act and enforcement of a contract qua contract before a Consumer Forum."

13. In Balakrishnan, the question arose for consideration was whether the policy was an "Act Policy" or "Comprehensive/Package Policy". Since there was no discussion either by the Tribunal or the High Court in this regard, the finding of the High Court and the Tribunal as regards the liability of the insurer was set aside and the matter was remitted back to the Tribunal to scrutinize the policy in a proper perspective.

*** *** ***

17. The decision of the Madras High Court in the case of Krishnan is distinguishable on facts. In the said case, the owner was insured with the insurance company for his personal accident cover and paid compulsory personal accident cover premium of Rs.100/-, besides additional personal accident cover premium of Rs.250/-.

4.4. It is further contended that decision rendered by this Court in

the above noted appeals was also upheld by the Hon'ble Apex Court

while dismissing the SLP in Special Leave to Appeal (Civil) No.

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19476 & 19477 of 2019 vide order dtd.14.08.2019. It is accordingly

contended that since the deceased was the owner of the offending

vehicle and the accident occurred due to rash and negligent driving

of the driver of the motorcycle and no other vehicle having been

involved in causing the accident, the application under Sec. 166 of

the M.V. Act should not have been entertained and in view of the

decisions as cited (supra), claim application should have been

dismissed at the threshold. But the Tribunal without proper

appreciation of the provisions contained under Sec. 166 of the M.V.

Act and the decisions governing the field, not only entertained the

appeal but also passed the impugned award allowing the claim

application so filed by the Claimants-Respondents.

4.5. It is also contended that Hon'ble Apex Court in the case of

State of Haryana Vs. Jasbir Kaur & Ors. (2003) 7 SCC 484 has

held that the compensation awarded should not be a bonanza.

Making all these submissions, it is contended that impugned award

is not sustainable in the eye of law.

5. Learned counsel appearing for the Claimants-Respondents on the

other hand while supporting the impugned judgment, contended that

since the M.V. Act is a beneficial legislation, strict adherence to the

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provisions is not a mandatory requirement and since there is no

dispute that the deceased died in a motor accident on 20.10.2018,

the claim application so filed under Sec. 166 of the M.V. Act is very

much maintainable.

5.1. It is also contended that the deceased though is the Owner of the

offending vehicle, but since he died because of the accident of the

said vehicle and the vehicle having been insured with the Appellant-

Company, the Tribunal while deciding the Issue No. II, clearly held

the claim application not only maintainable but also held the

Claimants entitled to get the benefit of compensation and

accordingly allowed the same vide the impugned award.

5.2. It is also contended that the deceased Alekha Putel though was

the owner of the offending vehicle bearing Registration No. OD-03-

K-0984, but the said vehicle was insured with the Appellant-

Company and the same is not disputed. It is also contended that

since the accident occurred during validity of the policy and it is not

the case of the Appellant that the driver of the offending vehicle was

not having valid D.L., no illegality or irregularity can be found with

the impugned judgment.

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6. Having heard learned counsel appearing for the Parties and

considering the submissions made and since learned counsel

appearing for the Appellant raised a preliminary objection with

regard to maintainability of the claim application so filed by the

Claimants-Respondents under Sec. 166 of the M.V. Act, this Court

prior to going to the merits and contentions raised, decided to take

up the said issue as a preliminary issue.

6.1. Sec. 166 of the M.V. Act reads as follows:-

"166. Application for compensation.-(1) An application for compensation arising out of an accident of the nature specified in sub-section (1) of section 165 may be made-

(a) by the person who has sustained the injury; or

(b) by the owner of the property; or

(c) where death has resulted from the accident, by all or any of the legal representatives of the deceased; or

(d) by any agent duly authorised by the person injured or all or any of the legal representatives of the deceased, as the case may be:

Provided that where all the legal representatives of the deceased have not joined in any such application for compensation, the application shall be made on behalf of or for the benefit of all the legal representatives of the deceased and the legal representatives who have not so joined, shall be impleaded as respondents to the application:

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[Provided further that where a person accepts compensation under section 164 in accordance with the procedure provided under section 149, his claims petition before the Claims Tribunal shall lapse.]

[(2) Every application under sub-section (1) shall be made, at the option of the claimant, either to the Claims Tribunal having jurisdiction over the area in which the accident occurred or to the Claims Tribunal within the local limits of whose jurisdiction the claimant resides or carries on business or within the local limits of whose jurisdiction the defendant resides, and shall be in such form and contain such particulars as may be prescribed:

[(3) No application for compensation shall be entertained unless it is made within six months of the occurrence of the accident.]

[(4) The Claims Tribunal shall treat any report of accidents forwarded to it under [Section 159] as an application for compensation under this Act].

[(5) Notwithstanding anything in this Act or any other law for the time being in force, the right of a person to claim compensation for injury in an accident shall, upon the death of the person injured, survive to his legal representatives, irrespective of whether the cause of death is relatable to or had any nexus with the injury or not.]

Objects and Reasons.- Clause 166 provides for the form of application for compensation, the person who may claim compensation, the time within which the application should be filed, etc. It also provides that if the Claims Tribunal, think so, may treat the accident report filed by the Police Officer as per clause 159 as an application under this Act."

6.2. Since in the instant case the deceased was the owner of the

offending vehicle and due to rash and negligent driving of the driver

who happens to be Respondent No. 4, the accident occurred on

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20.10.2018, placing reliance on the decisions in the case of

Sudhakaran as well as Sumitra Samal as cited (supra), it is the

view of this Court that the application under Sec. 166 of the M.V.

Act was not at all entertainable.

6.3. Therefore, without going to the merits and contentions of the

case, it is the view of this Court that the application was not at all

maintainable under Sec. 166 of the M.V. Act. Therefore, this Court

is inclined to quash the impugned judgment and so also dismiss the

claim application filed by the Claimants-Respondents in MAC Case

No. 1 of 2021 in the file of learned Addl. District Judge-cum-7th

MACT, Kantabanji. This Court accordingly while quashing the

impugned judgment, also dismiss MAC Case No. 1 of 2021 so filed

by the Claimants-Respondents in the Court of learned Addl. District

Judge-cum-7th MACT, Kantabanji.

7. The appeal accordingly stands allowed.

(BIRAJA PRASANNA SATAPATHY) Judge

Signature NotOrissa Verified High Court, Cuttack th Digitally Signed The 24 July, 2025/Sneha Signed by: SNEHANJALI PARIDA Reason: Authentication Location: High Court of Orissa, Cuttack Date: 28-Jul-2025 18:24:21