United India Insurance Company ... vs Vinod Kanwar
2021 Latest Caselaw 16717 Raj

HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR S.B. Civil Misc. Appeal No. 659/2021

United India Insurance Company Limited, Through The Manager, Shadulganj, Panchsati Circle, Bikaner

----Appellant Versus

1. Vinod Kanwar S/o Late Madan Singh, Heerawaton Ka Baas, Deshnok, District Bikaner.

2. Karnidaan S/o Madan Singh @ Madan Daan, Heerawaton Ka Baas, Deshnok, District Bikaner.

3. Shanti D/o Madan Singh @ Madan Daan, Heerawaton Ka Baas, Deshnok, District Bikaner.

4. Jashoda W/o Hameerdaan, Heerawaton Ka Baas, Deshnok, District Bikaner.

5. Hameerdaan S/o Dhokaldaan, Heerawaton Ka Baas, Deshnok, District Bikaner.

6. Harikishan S/o Bhikharam, Kumaharon Ka Mohalla, Deshnok, District Bikaner.

                                                                ----Respondents


For Appellant(s)          :    Mr. Aditya Singhi
For Respondent(s)         :    Mr. Vineet Jain
                               Mr. Pravin Vyas


           HON'BLE MR. JUSTICE RAMESHWAR VYAS
                         Judgment

November, 10, 2021

The instant appeal under Section 173 of the Motor

Vehicles Act, 1988 (Afterwards referred as 'the Act') has been filed

by the appellant - Insurance Company being aggrieved against

the impugned order dated 26.12.2021 passed by the Motor

Accident Claims Tribunal, Bikaner (Afterwards referred as

'Tribunal') in MAC No.434/2013, whereby, learned Tribunal after

exonerating the appellant - Insurance Company from liability to

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pay compensation directed the Insurance Company to first pay the

amount of compensation awarded and then recover the same from

driver & owner of the vehicle.

Brief facts of the case are that deceased Madan Singh

was occupant in a car being registration No. RJ07-CA-0237. On

account of rash and negligent driving by the driver of the Car, the

car turned turtle; Madan Singh and another occupant Narsingh

sustained injuries. Madan Singh succumbed to the injuries. Legal

heirs of Madan Singh filed a claim petition before learned Tribunal.

The claim petition, inter alia, was contested by the

appellant - Insurance Company on the ground that the Car was

insured by it in the 'Act Only' policy; the Insurance Company did

not charge any premium for covering the risk of occupant of the

Car.

Learned Tribunal while accepting the plea of the insurer

held that the Insurance Company is not liable to indemnify the

loss to the owner of the insured vehicle. However, learned Tribunal

directed Insurance Company to pay the compensation to the

claimants and recover the same from driver & owner of the

vehicle.

Heard learned counsel for the parties and perused the

material available on record.

Learned counsel for the appellant relying on the

judgments afterwards contended that the insurance policy in this

case does not cover the risk of occupant in the insured vehicle.

Since, deceased was travelling in the insured vehicle itself, hence,

he cannot be termed as thirty party. Insurance Company is liable

to indemnify the owner only for the loss sustained by the third

party, as it is 'Act Only' policy. There is no requirement in law to

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cover the risk of occupant of a private vehicle. Insurance Company

did not charge any premium for covering the risk of occupant in

the present case, hence, in view of provisions of Section 147 and

149 of the Act, learned Tribunal has committed grave error in

directing the Insurance Company to pay the amount of

compensation and then recover it from the driver & owner.

On the other hand, learned counsel for the respondent

relying on the judgments of Hon'ble Apex Court in the matters of

Varju & Ors. vs. United India Insurance Co. Ltd. : IV (2005)

ACC 5156 and Anu Bhanvara Etc. vs. IFFCO TOKIO General

Insurance Co. Ltd. : 2019 (2) RAR 209 (SC) contended that

deceased was survived by widow, two minor children and mother.

Insurance Company has been given right to recover the

compensation from the driver and owner. So there is no illegality

committed by learned Tribunal in passing the impugned judgment.

In the aforesaid cases, the Hon'ble Apex Court has passed the

order of pay and recover. In view of above circumstances, the

impugned order of learned Tribunal should not be interfered with.

Having regard to the rival contentions of the learned

counsel for the parties and after perusing the material available on

record, in the present case, the question before this Court is

whether learned Tribunal had right to order pay and recover in

case of 'Act Only Policy', where the risk of the deceased was not

covered.

In the present case, it is not in dispute that the risk of

deceased was not covered under the policy of vehicle. There is no

statutory requirement to cover the risk of occupants in private Car.

The risk of occupant in a private Car can only be covered by

paying premium, which is not the case in the present matter. It is

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admitted fact that no premium was paid by the owner of the Car

for covering the risk of the occupant. Learned Tribunal also

exonerated the Insurance Company since the policy was 'Act Only

Policy'.

The deceased, in the present case cannot be termed as

third party, whereas, pay and recover order can only be passed for

satisfying the judgment and award in respect of third party risk.

The duty of the Insurance Company as indicated in Section 149 of

the Act, is only to satisfy the judgment and award irrespective of

any liability as required to be covered by a policy under clause (b)

of Sub-section (1) of Section 147 of the Act. As per the provisions

of Section 147 of the Act, in case of private Car there is statutory

requirement to cover any liability in respect of death or bodily

injury to any person or damage to any third party. In this

provision, there is no statutory requirement to cover the risk of

occupant of private Car. As per the provisions of Section 149 of

the Act, order of pay and recover in such type of cases can only be

made in respect of liability caused to third party.

In the case of S.B. Civil Misc. Appeal No. 696/2003,

The Oriental Insurance Company Limited vs. Smt. Sharda

Devi & Ors, decided on 4.8.2016, relied by learned counsel for

the appellant, this Court while referring the judgment of Hon'ble

Apex Court in the matter of Oriental Insurance Co. Ltd. vs.

Meena Variyal : (2007) 7 SCC 425, National Insurance

Company Limited vs. Balkrishnan & Anr : (2013) 1 SCC 731,

modified the order of pay and recover of the learned Tribunal.

In the matter of Smt. Pawni & Ors. vs. G.Gobi @ Gopi &

Ors, S.B. Civil Misc. Appeal No. 322/2003 decided on 13.9.2019,

this Court also while relying on the judgment of National

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Insurance Company Ltd. vs. Balakrishnan & Anr : AIR 2013

SC 473, and Oriental Insurance Co. Ltd. vs. Meena Variyal &

Ors. : (2007) 5 SCC 428, held that the risk of deceased, who

was sitting in insured vehicle would not be covered by third party

and hence, the appellant Insurance Company would not be liable

to satisfy the award. The Court further held that it is well settled

proposition of law that in such case provision of direction to pay

and recover cannot be issued.

Coming to the judgments cited by the learned counsel

for the respondents, this Court is of the opinion that in the said

judgments, the Hon'ble Apex Court passed the order of pay and

recover exercising their power under Article 142 of the

Constitution. In no case, the Hon'ble Apex Court laid down any

principle that Insurance Company is under obligation to satisfy the

award under Section 149 of the Act in such type of cases.

In view of the settled legal position on this point, the

Insurance Company cannot be directed to pay the amount of

compensation awarded by the Tribunal to the claimants and then

recover it from the driver & owner of the insured vehicle.

Accordingly, the appeal is allowed. The impugned order

directing the Insurance Company to satisfy the award is set aside.

However, the claimants would be entitled to get compensation

from driver & owner only, as jointly and severally as per judgment

of learned Tribunal.

(RAMESHWAR VYAS),J

27-Mak/-

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