Andhra Pradesh State Road ... vs P. Madhusudhan Reddy, Adilabad ...
2023 Latest Caselaw 1451 Tel

     HONOURABLE SMT. JUSTICE M.G.PRIYADARSINI

               M.A.C.M.A.No.2095 of 2017

JUDGMENT:

This appeal is preferred by Telangana State Road

Transport Corporation (previously Andhra Pradesh State

Road Transport Corporation), questioning the order and

decree, dated 16.11.2016 passed in O.P.No.151 of 2015

(Old O.P.No.271 of 2013) on the file of the Chairman, Motor

Accident Claims Tribunal-cum-III Additional District

Judge, Asifabad (for short, "the Tribunal").

2. For the sake of convenience, hereinafter the parties

will be referred to as per their array before the Tribunal.

3. Brief facts of the case are that the claimant filed a

petition under Section 166 of the Motor Vehicles Act, 1988,

claiming compensation of Rs.5,00,000/- for the injuries

sustained by him in the road accident that occurred on

21.12.2009. According to the claimant, on the fateful day,

he boarded a bus bearing No. AP 15 Y 8557, owned by

respondent No. 1, insured with respondent No. 2, hired by

respondent No. 3, from Secunderabad to Mancherial. At 2 MGP,J MACMA No.2095 of 2017

about 04:25 a.m., when the said bus reached at the

outskirts of Kundanapalli village on Rajiv Rahadar

Highway, suddenly the said bus went beyond the road

margin and fell down from a bridge in a Nala. As a result,

the claimant was crushed in the bus and sustained

multiple fractures and injuries all over the body.

Immediately, he was taken to Government Area Hospital,

Godavarkhani and thereafter he was admitted as inpatient

in Apollo Hospital, Hyderabad, on 22.12.2009 and

discharged on 30.12.2009 and underwent two surgeries on

23.12.2009 & 25.12.2009 respectively. He spent

Rs.2,50,000/- towards hospital and medical expenses.

According to the claimant, he was hale and healthy and

earning Rs.15,000/- per month on business. Due to the

accident, he suffered permanent disability and lost his

earning capacity. Therefore, he laid the claim against the

respondents.

4. Before the Tribunal, the respondent No. 1 remained

ex parte. The respondent No. 2 filed counter denying the

averments of petition, age, avocation, income of the 3 MGP,J MACMA No.2095 of 2017

claimant. It is further contended that the driver of

respondent No. 1 has no valid driving licence and thereby

violated terms and conditions of insurance policy, as such

respondent No. 2 is not liable to pay the compensation. It is

lastly contended that the claim is excessive and exorbitant

and prayed to dismiss the petition. Per contra respondent

No. 3 filed counter stating that respondent No. 1, owner of

the bus which was insured with respondent No. 2 and that

policy was in force as on the date of the accident. Hence,

respondent No. 3 is not liable to pay compensation and

prayed to dismiss the petition.

5. Considering the claim, counters filed by respondent

Nos.2 & 3 and the oral and documentary, the Tribunal held

that the accident occurred due to the negligent driving of

the driver of the R.T.C. bus and awarded compensation of

Rs.2,30,500/- to be paid by the respondent Nos.2 and 3

jointly and severally. Challenging the same, the present

appeal is filed by the Road Transport Corporation.

6. Heard the learned counsel for the claimant, learned

Standing Counsel for the Insurance Company and the 4 MGP,J MACMA No.2095 of 2017

learned Standing Counsel for the RTC. Perused the

material available on record.

7. The learned Standing Counsel for the RTC-appellant

has vehemently contended that the Tribunal grossly erred

in fixing liability on the RTC, who is a mere hirer of the

bus, and in fact, as policy was in force, the liability ought

to have been fixed on the insurer and owner of the bus. It

is contended that the hire agreement between the owner of

the vehicle and the RTC does not absolve the liability of

insurer from payment of compensation and therefore, the

RTC ought to have been exonerated from the liability.

8. Per contra, learned Standing Counsel for the

Insurance Company has submitted that the Tribunal has,

in fact, granted adequate compensation and the same

needs no interference. Insofar as the liability is concerned,

it is contended that inasmuch as the RTC was hirer of the

bus, the tribunal has rightly apportioned the compensation

amount to be payable by the RTC and the Insurance

company equally.

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                                               MACMA No.2095 of 2017

9. With regard to the manner of the accident, the

Tribunal having framed issue No.1 as to whether the

accident took place due to rash and negligent driving of the

driver of RTC bus bearing No. AP 15 Y 8557, and after

considering the evidence of P.W.1 coupled with the

documentary evidence i.e., Ex.A1, First Information Report

and Ex.A9, copy of final report, the tribunal has

categorically observed that the accident occurred due to

the rash and negligent driving of the RTC bus by its driver

and has answered the issue in favour of the claimant and

against the respondents. Therefore, I see no reason to

interfere with the finding of the Tribunal that the accident

occurred due to the rash and negligent driving of the RTC

bus by its driver.

[

10. Insofar as quantum of compensation is concerned, a

perusal of medical record i.e., evidence of P.W.2,

Orthopedic Surgeon at Apollo Hospital and Ex.A.2, Injury

certificate, reveals that the claimant sustained fracture to

right femur besides other injuries to left thigh and other

parts of the body. Considering the nature of injuries 6 MGP,J MACMA No.2095 of 2017

sustained by the claimant, the Tribunal has rightly

awarded Rs.50,000/- towards pain and sufferings;

Rs.1,63,385/- towards medical expenses by relying upon

Ex.A.6, A.7, A.12, A.13 & A.15; Rs.5,000/- towards

attendant charges, which are reasonable and needs no

interference by this Court. Coming to the income of the

claimant, he had claimed that he was earning Rs.15,000/-

per month on business. But no evidence is produced,

either oral or documentary, to prove his income and

avocation. In Latha Wadhwa vs. State of Bihar1, the Apex

Court has held that even there is no proof of income and

earnings, the income can be reasonably estimated. Since,

the claimant was aged about 35 years at the time of the

accident, the tribunal has rightly awarded Rs.12,000/-

towards loss of earnings during the treatment.

11. Insofar as rate of interest is concerned, the tribunal

has erroneously granted interest rate at 9% per annum

instead of 7.5%. Therefore, in light of the decision of the

Apex Court in Rajesh and others v. Rajbir Singh and

(2001) 8 SCC 197 7 MGP,J MACMA No.2095 of 2017

others2 the rate of interest is hereby reduced to 7.5% per

annum from 9% on the compensation awarded by the

Tribunal from the date of petition till the date of realization.

12. Insofar as the liability is concerned, admittedly, the

R.T.C., is the hirer of the crime bus that belonged to

respondent No. 1 and insured with respondent No. 2. It is

also not in dispute that policy was in force as on the date of

accident. The owner of the bus paid the premium towards

liability of passengers and third parties risk. The insurance

company collected the said premium and issued the policy.

Therefore, merely because there is hire agreement between

the owner of the bus and the RTC, it cannot absolve the

liability of the Insurance Company from payment of

compensation.

13. In A.P.S.R.T.C., Hyderabad v. B.Kanaratnabai3 a

Full Bench of composite State of Andhra Pradesh held as

under:-

2 2013 ACJ 1403 = 2013 (4) ALT 35



    (2013) 1 ALD 644 (FB)
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                                                                    MACMA No.2095 of 2017

"83. On principle, it is not open to the insurance companies to absolve themselves of liability towards passenger/third party risks on the short ground that the insured vehicle has been given on hire without following the prescribed procedure. This Court in Madineni Kondaiah's case (supra) has already held that even transfer of the ownership of an insured vehicle without following the due procedure would not absolve the insurance company of liability towards third party risks. Mere transfer of possession, through hire of the vehicle, cannot stand on a worse footing or exempt the Insurance Companies from liability in this regard.

84. .....

85. On the above analysis, we hold that mere hiring of insured buses by the owners to the APSRTC would not in any manner limit the liability and accountability of the Insurance Companies, be it under the Act of 1988 or the Act of 1939, to honour passengers/third party risks covered by the Insurance Policies issued by them in favour of the owners. Notwithstanding the hiring of insured buses by the owners to the APSRTC, the Insurance Companies shall be solely and exclusively liable for payment of the compensation arising out of such passengers/third party claims unless any of the grounds in Section 149 (2) of the Act of 1988/Section 96 (2) of the Act of 1939 are made out."

14. In U.P.State Road Transport Corporation v.

National Insurance Company Limited and others4 while

referring to the judgment in U.P.State Road Transport

Corporation v. Kulsum5 the Apex Court held as under:

2021 ACJ 2282

2011 ACJ 2145 (SC) 9 MGP,J MACMA No.2095 of 2017

"The Court has come to the conclusion that when the effective control and command of the bus is with the Corporation, the Corporation becomes the owner of the vehicle for the specified period. It was further held that when the actual possession of the vehicle is with the Corporation, the vehicle, the driver and the conductor were under the direct control and supervision of the Corporation. Therefore, "through the definition of 'vicarious liability' it can be inferred that the person supervising the driver is liable to pay the compensation to the victim. During such time, however, it will be deemed that the vehicle was transferred along with the insurance policy, even if it were insured at the instance of the original owner. Thus, the insurance company would not be able to escape its liability to pay the amount of compensation."

15. In view of the law laid down by the Apex Court in the

judgments referred to above, the finding of the tribunal in

fastening liability jointly and severally upon the RTC along

with insurance company is not sustainable under law and

liable to be set aside.

16. Accordingly, the M.A.C.M.A stands allowed setting

aside the findings of the tribunal to the extent of fastening

liability jointly and severally upon the appellant-RTC along

with the Insurance Company, respondent No. 2. The

appellant-RTC is exonerated from the liability of payment of

compensation and the respondent No. 1 being owner and

respondent No. 2 being insurer of the crime bus are liable 10 MGP,J MACMA No.2095 of 2017

to pay the compensation. The appellant-RTC is at liberty

to recover the amount, if any already paid/deposited, from

the insurer i.e., respondent No. 2. The rate of interest is

reduced from 9% per annum to 7.5% per annum from the

date of filing of O.P. till the date of realization. There shall

be no order as to costs.

Miscellaneous petitions, if any, pending shall stand

closed.

                                       ______________________
                                       M.G.PRIYADARSINI,J
29.03.2023
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                      11                         MGP,J
                                 MACMA No.2095 of 2017

THE HONOURABLE SMT. JUSTICE M.G.PRIYADARSINI

M.A.C.M.A.No.2095 of 2017

DATE: 29.03.2023

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