Telangana High Court

The Oriental Insurance Company ... vs Akula Narayana And Another on 8 June, 2022

Bench: P.Sree Sudha

THE HONOURABLE SMT. JUSTICE P.SREE SUDHA

               M.A.C.M.A. No.670 OF 2021

JUDGMENT:

1. This appeal is filed by the appellant-Insurance

Company aggrieved by the order and decree, dated

29.04.2021, passed in O.P.No.3128 of 2014 on the file of

the Motor Accidents Claims Tribunal-cum-IIII

Additional Chief Judge, City Civil Court, Hyderabad (in

short" Claims Tribunal").

For the sake of convenience the parties hereinafter

be referred to as arrayed before the trial Court.

2. Before the Claims Tribunal the claimant filed claim

petition under Section 163-A of the Motor Vehicles Act

(for brevity the M.V.Act) seeking compensation of

Rs.5,00,000/- consequent on death of his daughter, 4

years, in a motor vehicle accident. It is stated by the

claimant that on 18.05.2014 when his daughter and wife

and other relatives were proceeding in a Omni Quails

Van bearing No.AP-32-D-0300 towards Toopran side,

and when the said vehicle reached near Check Post,

Medchal the driver of the said vehicle drove it in a rash

and negligent manner and hit an unknown vehicle

while it was taking a turn towards Shamirpet, as a

result of which there was head on collusion. Due to the

impact of the accident, the inmates of Qualis vehicle i.e.

deceased-Rajeswari and her mother sustained fatal

injuries and died on the spot. The other inmates of the

Qualis vehicle and the driver also sustained injuries.

Since the accident occurred due to rash and negligent

driving of the driver of Tata Qualis vehicle bearing

No.AP-32-D-0300, the claimant filed claim petition

seeking compensation of Rs.5,00,000/- against the

respondents 1 and 2, being the owner and insurer of the

said vehicle.

4. Before the Claims Tribunal the 1st respondent-

owner of the vehicle stood ex parte, whereas the 2nd

respondent-insurer filed counter resisting the claim of

the petitioner.

5. Before the Claims Tribunal, PWs.1 and 2 were

examined and Exs.A1 to A7 were marked on behalf of

the claimant. On behalf of the respondents, RW1 was

examined and Exs.B1 and B2 were marked.

6. The Claims Tribunal court, after considering the

oral and documentary evidence on record, granted

compensation of Rs.3,93,000/- with interest @ 7.5% per

annum against the respondents 1 and 2 jointly and

severally. Aggrieved by the same, the appellant-

insurance company preferred the present appeal.

7. The appellant-insurer mainly contended that the

policy was an Act policy issued for a private car, as such

the risk of occupants of private car does not cover.

Except the driver, owner and cleaner, all others are third

parties to the policy. Under statutory liability the

insurer covers only third party liability and the

passengers carried in a public service vehicle, and the

passengers of a private vehicle does not cover. In

support of their contention, the learned Counsel for the

appellant relied on decisions reported in (1) United

India Insurance Company Ltd., Vs. Syed Rehamat Ali

and (2) Chacko Vs. Jose and united Insurance Company

Vs. Tilak Singh, in which the Hon'ble Supreme Court

held that the occupants of a private vehicle as well as

pillion rider of a two wheeler were not covered by the

policy and the insurance company is not liable to pay the

compensation, but the trial Court erred in fastening the

liability on the insurance company.

7. Heard both the Counsel and perused the record

and also order of the trial Court.

8. Ex.B1 is the copy of the policy and Ex.B2 is the

attested copy of terms and conditions of the policy. The

Claims Tribunal held that the vehicle was passengers

vehicle and the deceased was a third party, as such

insurance company is liable to pay compensation.

9. PW1 is the father of the deceased and PW2 is the

brother-in-law of PW1 and brother of the complainant.

According to the PW1, nine persons were travelling in

the offending vehicle against its seating capacity. It was

suggested to PW1 that since more than nine persons

were travelling in the car against the seating capacity the

2nd respondent is not liable to pay compensation. PW2

is the brother of the complainant and eye witness to the

accident. PW1 stated that in the complaint it is stated

that the accident was occurred due to hit and run of one

unknown vehicle, but not due to rash and negligence

driving of the driver of Qualis. They have not filed

charge sheet to show that the driver of the Qualis was at

fault. PW2 is the brother-in-law of PW1 and

brother of the complainant.

9. RW1 is the Administrative Officer of appellant-

insurance company. He stated the policy was in

existence as on the date of accident, and it was issued in

respect of Omini Qualis van bearing No.AP-32-D-0300

under private car liability and no additional premium

was paid to cover the liability of the passengers. In the

complaint dated 19.05.2014 it was stated that while the

deceased was proceeding in Qualis one unknown

vehicle hit the Qualis and ran away and there was no

negligence on the part of the driver of the Qualis, as such

petition itself under Section 163-A of the M.V. Act is not

maintainable and even in the final report it was stated

as "un-detected". In the cross-examination he clearly

stated that even if they have collected additional

premium it will not cover risk of inmates the policy. The

seating capacity of the Qualis car was 4 + 1 and premium

collected is Rs.4,016/- and Ex.B1 was issued in respect

of private car under an Act policy. They have collected

additional premium for driver, conductor and cleaner

and also collected a sum of Rs.100/- from owner of the

vehicle as P.A for owner and driver. Police had not

recoded the statement of the complainant.

11. The learned Counsel for the appellant-insurance

also relied on the following decisions:

i). United India Insurance Company Limited Vs.

Tilak Singh and others, reported in (2006) 4 Supreme

Court cases, 404, wherein it was held that:

"An Insurance policy under Section 147 does not cover

the risk of death or injury to gratuitous passengers

carried in a private vehicle"

ii. Ramashary Singh Vs. New India Assurance

Company Limited, reported in (2003) 10, Supreme

Court cases, 664, wherein it was held that:

"Under Section 147 the liability of insurer in respect of

third party risk, the policy covers only the persons or

classes of persons specified in the policy. Moreover,

comprehensive policy covers loss sustained by the

insured up to the insured amount irrespective of the

actual loss suffered"

10. The learned Counsel for the respondent No.1-

claimant also argued that even if the policy was not

valid the insurance company is liable to pay the amount

and then they are at liberty to recover from the owner of

the vehicle and thus the order of the trial court is on

proper appreciation of facts and needs no interference.

11. The learned Counsel for the respondent No.1-

claimant, also relied on the following citation:

National Insurance Company Ltd., Vs. Challa

Upender Rao and others, reported in (2004) 8, SCC

517, wherein it was held that:

"Considering the beneficial object of the Act, it would be proper for the insurer to satisfy the award, though in law it has no liability. In some cases the insurer has been given the option and liberty to recover the amount from

the insured. For the purpose of recovering the amount paid from the owner, the insurer shall not be required to file a suit. It may initiate a proceeding before the executing court concerned as if the dispute between the insurer and owner was the subject matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. Before release of the amount to the claimants, owner of the offending vehicle shall furnish security for the entire amount which the insurer will pay to the claimants. The offending vehicle shall be attached, as a part of the security. If necessity arises the executing court shall take assistance of the Regional Transport Authority concerned. The executing court shall pass appropriate orders in accordance with law as to the manner in which the owner of the vehicle shall make payment to the insurer. In cases there is any default it shall be open to the executing court to direct realization by disposal of the securities to be furnished or from any other property or properties of the owner of the vehicle i.e. the insurer. In the instant case, considering the quantum involved it is in the discretion of the insurer to decide whether it

would take steps for recovery of the amount from the insured"

12. Admittedly the deceased was travelling in Qualis,

but the accident occurred due to rash and negligent

driving of the unknown vehicle and it is a clear case of

hit and run and even in the final report it was stated as

"undetected'. There is no negligence on the part of the

driver of Qualis Vehicle as per the evidence on record.

The appellant-insurance company clearly stated that it is

an Act policy and additional premium was not paid for

the passengers. The passengers in a private vehicle does

not cover under statutory liability and they may be

exonerated from paying the compensation.