Leena Jogesh vs By Adv. Sri.T.K.Radhakrishnan on 20 September, 2011

[Cites 4, Cited by 0]

Kerala High Court

Leena Jogesh vs By Adv. Sri.T.K.Radhakrishnan on 20 September, 2011

The captioned appeal is filed by the claimants against the judgment and award dated 20.09.2011 passed by the Motor Accidents Claims Tribunal, Kottayam in O.P.(MV).No.1702 of 2007. They are respectively the widow and children of one Jogesh P. Varghese who died in a motor vehicle accident. He was travelling in a Santro Car bearing Reg.No.33-3726 on 3.6.2007. At about 12.30 a.m when the said vehicle reached at Velloorkkunnam junction at Muvattupuzha, it hit against against an electric post and Jogesh P.Varghese and the other passengers sustained injuries. Jogesh P.Varghese was taken to Medical College Hospital, Kottayam and thereafter to Medical Trust Hospital, Ernakulam. While undergoing treatment there as an inpatient, he died on 14.06.2007. Essentially, it M.A.C.A.129/2012 & CO.39/2012 2 is raising the allegation of rashness and negligence on the part of the first respondent and raising necessary averments to make second respondent vicariously liable and to make the third respondent liable to indemnify the second respondent, that O.P.(MV).No.1702 of 2007 was filed. The Tribunal after a careful analysis of the evidence on record as also the arguments advanced, passed the impugned award holding that the petitioners are entitled to a compensation of `11,71,830/- with interest @ 7.5% from the date of the petition viz., 19.11.2007 till realisation along with cost of `23,000/-. Respondents 1 and 2 were directed to pay the amount covered by the award and upholding the contentions of the third respondent, it was held that the third respondent is not liable to indemnify the second respondent.

2.The appellants are aggrieved by the award as it absolved the third respondent from the liability to indemnify the second respondent. Of course, they also seek for enhancement of the quantum of compensation. Respondents 1 and 2 filed the cross M.A.C.A.129/2012 & CO.39/2012 3 objection virtually against the finding of the Tribunal by which it absolved the third respondent from indemnifying the second respondent and saddled them with the liability to compensate the claimants. It is the contention in the cross objection that the finding of the Tribunal is unsustainable and it invites appellate interference and further that the third respondent shall be made liable to indemnify the second respondent..

3.We have heard the learned counsel for the appellants, the learned counsel appearing for respondents 1 and 2 and also the learned counsel appearing for the insurer, the third respondent. Considering the fact that the third respondent did not file any appeal against the quantum of compensation fixed by the Tribunal, we need only to look into the question whether there is any force in the challenge made by respondents 1 and 2 against the quantum of compensation fixed by the impugned award on the ground that it is exorbitant. But it is to be noted that the appellants even while challenging the exoneration of the third respondent from the liability M.A.C.A.129/2012 & CO.39/2012 4 to compensate rather, to indemnify the second respondent seek for enhancement of the quantum of compensation. We are of the view that the status of Jogesh P.Varghese viz., whether he was a gratuitous passenger or not has to be decided first and then the questions whether the policy in question is a comprehensive policy and whether the Tribunal is justified in absolving the third respondent from indemnifying the second respondent are to be considered. For considering the aforesaid question, a succinct narration of the facts is inevitable. The second respondent purchased the vehicle in question on 8.2.2007 and he insured the said vehicle with the third respondent and admittedly, the policy in respect of the said vehicle is a private car package policy. Later on 13.2.2007, the second respondent registered the said vehicle as a taxi and obtained taxi permit on 20.3.2007 and it was valid up to 19.3.2012. The respondents before the Tribunal produced Exts.B3 and B5 which are the photocopies of the policy certificates. The accident occurred within the validity period of the package policy. But at the same time, the third respondent took up the contention that the vehicle in M.A.C.A.129/2012 & CO.39/2012 5 question was insured as a private car and the fact that it was subsequently registered as a taxi was not at all intimated to the third respondent by the second respondent. So also, it is contended that the second respondent had not paid the requisite additional premium to obtain modified policy certificate so as to get insurance coverage for the said vehicle on its conversion as a taxi. Respondents 1 and 2 filed a joint written statement contending inter alia that Santro Car was having a valid insurance policy with the third respondent at the time of the accident. It is stated therein that the car hit against an electric post and consequently, Jogesh P. Varghese sustained injuries and that the death was not due to the accident but due to the negligence on the part of the hospital authorities. In the written statement, they have specifically denied the negligence on the part of the first respondent. Ext.A6 is the photocopy of the wound certificate. Ext.A5 is the postmortem certificate which would reveal that Jogesh P.Varghese died on 14.6.2007 due to the injuries sustained in the accident. In the claim petition, it was stated that the deceased was running an Aluminium Fabrication Unit besides M.A.C.A.129/2012 & CO.39/2012 6 undertaking contract in respect of such works. That apart, it is stated therein that he was running shops at Karukachal, Vazhoor as well as in Pulikkal kavala. Ext.A15 is the license issued from Karukachal Grama Panchayat revealing that the deceased was conducting aluminium fabrication store in building bearing No.V/105B(1) of Karukachal for the period 2005-'06. Ext.A16 is the membership certificate issued by the Kerala Vyapari Vyavasayi Ekopana Samithi to the deceased. Exts.A19 and A20 are respectively the driving licence and photocopy of the first page of the SSLC book of the deceased. They would go to show that the date of birth of the deceased was 1.5.1971. In other words, they would go to show that he was aged 36 years at the time of his death. A scanning of the ground raised in the appeal as also the arguments raised on their behalf would reveal that there is no serious challenge with respect to the quantum of compensation fixed by the Tribunal and no appeal has been preferred by the third respondent insurer against the impugned award. Respondents 1 and 2 evidently raised challenge against the quantum fixed by the Tribunal as per the impugned M.A.C.A.129/2012 & CO.39/2012 7 award. A perusal of the cross objection would reveal that apart from raising a vague contention as ground No.3, no specific challenge was made by respondents 1 and 2 against the impugned award in respect of the manner in which the Tribunal assessed the compensation. Ground 3 reads thus:-

"The lower court has awarded exorbitant amounts towards compensation on various heads without any basis and failed to fix the just compensation in the petition."

A scanning of the said ground would reveal that apart from making a vague allegation that the Tribunal awarded exorbitant amounts towards compensation under various heads, respondents 1 and 2 did not specifically state as to which are the heads under which the Tribunal awarded compensation exorbitantly. In such circumstances, we have no hesitation to hold that the challenge by respondents 1 and 2 against the award on the ground that compensation fixed by the Tribunal is exorbitant is devoid of any merit and therefore, the impugned award calls for no interference at their instance, on the ground of exorbitancy. We will consider the question whether the appellants are entitled to enhanced M.A.C.A.129/2012 & CO.39/2012 8 compensation after considering the question whether Tribunal was justified in exonerating the insurance company from the liability to indemnify the insured-owner viz., the second respondent.

4.But the question to be considered is whether the Tribunal was correct in absolving the third respondent from indemnifying the second respondent or in other words, whether the Tribunal was justified in directing respondents 1 and 2 to pay the amount awarded as per the impugned award. The facts stated hereinbefore as also the rival contentions raised have to be analysed to answer the said question. Certain indisputable aspects have to be taken note of for answering the said question. The fact that the vehicle in question was insured only as a private car with a private car package is not in dispute. The fact that subsequently the vehicle was registered as a taxi was not at all duly intimated by the second respondent to the third respondent. Above all, the second respondent had not paid the requisite premium for getting appropriate insurance coverage which is bound to be taken in respect of a taxi car. These facts are not at all M.A.C.A.129/2012 & CO.39/2012 9 disputed. In other words, the indisputable position obtained in this case is that the vehicle in question involved in the accident was having only a private car package policy at the relevant point of time. Evidently, the deceased Jogesh P.Varghese was travelling in the vehicle as a passenger. The very case of respondents 1 and 2 is that in respect of the vehicle in question a taxi permit was obtained on 20.3.2007. True that the accident occurred only subsequently. The position obtained is to the effect that the second respondent had taken only a private car package policy and on receipt of taxi permit he had failed to intimate it to the third respondent-insurer and also to obtain proper insurance coverage for the said vehicle as a taxi by paying additional premium. The said unrebutted factual aspects would indicate that the deceased person was travelling in the vehicle as gratuitous passenger. The learned counsel for the third respondent contends that when that be the position, the Tribunal was justified in absolving the insurer from indemnifying the second respondent who is the owner of the vehicle in question. Per contra, the contention of the learned counsel for the second respondent is to the effect that M.A.C.A.129/2012 & CO.39/2012 10 since the vehicle in question was having a private car package policy, merely by contending that no additional premium was paid by the second respondent, on receipt of taxi permit, the third respondent cannot wriggle out of the liability to indemnify the second respondent.

5.The insured/second respondent as also the insurer/third respondent have relied on various authorities in support of their rival contentions mentioned hereinbefore. The learned counsel for respondents 1 and 2 relied on the decision of the Hon'ble Apex Court in Bhagyalakshmi and others v. United Insurance Company Limited and another [2009(7) SCC 148, National Insurance Co. Ltd v. Balakrishnan [2012 (4) KLT SN 145 (C.No.139) SC] as also the decision in National Insurance Co. v. Abhaysing P. Waghela [2008(4) KLT 657 SC]. Bhagyalakshmi's case was relied on by the learned counsel for respondents 1 and 2 to drive home the point that since the policy in question is a package policy, the contract of insurance if given its face value would cover M.A.C.A.129/2012 & CO.39/2012 11 the risk not only of a third party but also of persons travelling in the car, including the owner thereof. The learned counsel drew our attention to paragraph 13 thereunder which reads thus:-

"The policy in question is a package policy. The contract of insurance if given its face value covers the risk not only of a third party but also of persons travelling in the car including the owner thereof. The question is as to whether the policy in question is a comprehensive policy or only an Act policy."

6.The learned counsel appearing for the third respondent submitted that a scanning of the said decision would undoubtedly reveal that it is nothing but an order whereby the Hon'ble Apex Court referred the matter for fresh consideration by a larger Bench. No specific finding with respect to the question whether a package policy is a comprehensive policy or an act policy was actually decided thereunder, it is contended. After giving our anxious consideration taking note of the aforesaid contentions, we are of the view that there is substance in the contention raised by the third respondent. True that paragraph 13 of the said decision would reveal that the Hon'ble Apex Court held that the question to be M.A.C.A.129/2012 & CO.39/2012 12 decided in that case was whether the policy in question viz., a package policy is a comprehensive policy or only an act policy. No definite finding was returned with respect to that question. At the same time, paragraph 28 of the said decision would reveal that their Lordships were of the opinion that the said matter requires a consideration by a larger Bench and accordingly, directed to place the papers before the Hon'ble the Chief Justice for appropriate orders. In such circumstances, the said decision cannot be relied on as a binding precedent. The learned counsel for respondents 1 and 2 took up another contention to drive home the point that a package policy is a comprehensive policy and it would cover liability of insurer for payment of compensation for occupant in a private car. It is submitted that the said issue has been settled by the Hon'ble Apex Court in the decision in Balakrishnan's case (supra). In Balakrishnan's case, the Hon'ble Apex Court held that a comprehensive/package policy would cover the liability of the insurer for payment of the compensation for the occupant in a car. It was also clarified that an act policy would not cover the third party M.A.C.A.129/2012 & CO.39/2012 13 risk of an occupant in a car. Evidently, a circular issued by the Insurance Regulatory and Development Authority (IRDA) viz., IRDA/NL/CIR/F & U/073/11/2009 dated 16.11.2009 was considered by the Hon'ble Apex Court. The contention of the learned counsel for the second respondent is that a standard motor package policy is also to be called as a comprehensive policy. In other words, according to the learned counsel, package policy is a synonym of comprehensive policy. In this context, certain aspects have to be looked into. In Balakrishnan's case (supra) also, what their lordships held is that a comprehensive/package policy would cover the liability of the insurer for payment of compensation for the occupant in a car. To consider whether there is substance in the contention that package policy is a synonym of comprehensive policy it is relevant to refer to paragraph 13 of the decision in Bhagyalakshmi's case. It would reveal that the policy involved in that case was also a package policy. Still the Hon'ble Apex Court held that the question to be considered is whether the said policy is a comprehensive policy or Act policy. In other words, the Hon'ble M.A.C.A.129/2012 & CO.39/2012 14 Apex Court formulated the question as to whether a package policy could also be treated as a comprehensive policy or whether it is an Act policy. Paragraph 28 of Bhagyalakshmi's case would reveal that the said question as also the liability under the package policy were not decided finally. Now, what exactly is the meaning of the sign '/' (oblique) ? Going by the New Oxford Advance Learners Dictionary, the symbol '/' is used to show alternatives, as in lunch and/or dinner and 4/5 people. In such circumstances, the contention of the learned counsel that the term package policy is a synonym of comprehensive policy cannot be accepted. But at the same time, in the light of the decision of the Hon'ble Apex Court in Balakrishnan's case (supra), it is evident that a comprehensive policy or a package policy would cover the liability of the insurer for payment of compensation for occupant in a car. Evidently, the Hon'ble Apex Court held so in the light of the aforementioned circular of the IRDA. Therefore, the question to be decided is in view of the indisputable position obtained in this case that Jogesh P.Varghese was a passenger in the said vehicle whether the third M.A.C.A.129/2012 & CO.39/2012 15 respondent is liable to indemnify the second respondent, the insured, in view of the fact that the insured was having a valid package policy in respect of the vehicle in question. It is to be noted that he travelled in the said vehicle as a passenger after it was granted with taxi permit. In the contextual situation, it will be appropriate to refer to a decision of a Division Bench of this Court in New India Assurance Co. Ltd. v. Mohammed Ali [2013 (4) KLT 822]. The offending vehicle involved in the said case was a goods vehicle. In the said goods vehicle, a gratuitous passenger travelled and the said vehicle met with an accident and the said gratuitous passenger filed a claim for getting compensation. The said vehicle was having a package policy. Paragraph 9 insofar as it is relevant reads thus:-

"It is clear from the above circulars that the I.R.D.A had clarified that in the case of package/comprehensive policy, the insurance company is liable to indemnify the insured for the injuries or death caused to a person carried in a private car or pillion rider carried in a two-

wheeler and it was not extended further. So, merely because it was a package/comprehensive policy, it will not ipso facto cover the liability of all gratuitous passengers carried in all types of vehicles, including goods vehicles. Unless extra M.A.C.A.129/2012 & CO.39/2012 16 premium is collected by the insurance company for covering the liability of such persons, the insurance company cannot be mulcted with the liability of indemnifying the insured in such cases. In this case, admittedly, the vehicle involved is a goods vehicle and the deceased was a gratuitous passenger carried in the goods vehicle and the liability of such persons was not covered as per the terms of the policy. Under such circumstances, the Tribunal was not justified in making the insurance company liable to pay the amount by way of indemnifying the insured on the assumption that package/comprehensive policy will cover the liability of such persons as well and the finding of the court below to that extent is liable to be set aside."

(Emphasis supplied)

7.In the light of the said decision, the insurance policy involved in this case has to be looked into. In Ext.B5 policy, the limitations of use have been specifically mentioned. The same in so far as it is relevant for the purpose of this case reads thus:-

"The policy covers use of vehicle for any purpose other than: hire or reward."

8.Thus it is evident that in the package policy also it is specifically stated that the policy would cover only use of vehicle M.A.C.A.129/2012 & CO.39/2012 17 for any purpose other than hire or reward. When a person was allowed to travel in a private car for hire or reward, his status can only be that of a gratuitous passenger. In this case in fact, there is no scope for disputing the said case as the very case of respondents 1 and 2 is that the vehicle in question was having only a private car package policy. Though it received a taxi permit that was not properly intimated to the insurer and additional premium to get coverage as a taxi was not paid by the second respondent. True that in the light of the decision in Mohamed Ali's case (supra), it was held that merely the policy in respect of the vehicle in question was a package policy or a comprehensive policy it would not ipso facto cover the liability of gratuitous passengers carried in all types of vehicles. It was further held therein that unless extra premium is collected by the insurance company for covering the liability of such persons, the insurance company cannot be mulcted with the liability of indemnifying the insured in such cases. In this context, the admitted fact is that the vehicle in question was insured only originally as private car and it was subsequently registered as a taxi M.A.C.A.129/2012 & CO.39/2012 18 and though a taxi permit therefor was obtained the said fact was not duly intimated to the insurer and the second respondent had not paid any extra premium required for the purpose of covering the liability of such passengers like the deceased. It is to be noted that the premium payable in respect of a private car and also in respect of a taxi for getting insurance coverage is different. The basic premium for private car is `800/- whereas the basic premium for taxi is `2,330/-. Additionally, in order to have coverage for passengers an additional amount of `350/- per passenger, taking into account the seating capacity also have to be paid. In this case, the second respondent did not have a case that after registering the vehicle in question as a taxi and after obtaining the taxi permit on 20.3.2007, premium in respect of a taxi or additional premium has been remitted. In the light of the factual matrix obtained in this case, we are of the considered view that the finding of the Tribunal that the third respondent is not liable to indemnify the second respondent cannot be said to be a faulty decision which invites an appellate interference. This Court usually orders for pay and recovery in M.A.C.A.129/2012 & CO.39/2012 19 order to ensure payment of the award amount to the claimant without undue delay even in a case where strictly speaking insurance company is not liable to indemnify the insured. In view of the factual matrix obtained in this case as above, we are of the considered view that an order of pay and recovery can be made.

9.Now, we will consider the question whether appellants are entitled to get enhanced compensation. We have already noted that no serious challenge was made by the appellants against the quantum of compensation. Ground 'e' raised in the appeal reads thus:-

"The amount awarded by the Tribunal is inadequate considering the income and future prospects of the deceased. It ought to have been granted the amount claimed in the claim petition."

10.No other contentions have been raised in that regard to mount challenge against the quantum fixed by the Tribunal as compensation. The appellants have produced documents like Exts.A13, A15, A16, A17, A25 etc. to establish that the deceased M.A.C.A.129/2012 & CO.39/2012 20 was a business man and contractor. However, no cogent evidence was adduced to establish his income. Though the appellants have produced documents which would reveal remittance towards chitty transactions with KSFE, certificate issued by the Director Crown Institute of Aluminium Fabrication, Kottayam, Licence issued from Karukachal Grama Panchayat and Membership Certificate issued from Kerala Vyapari Vyavasayi Ekopana Samithi, there is nothing on record to reveal whether he was a tax payee over the years. In such circumstances, the Tribunal cannot be found fault with in fixing the monthly income, for calculation purpose, notionally. Taking into account the number of dependents, < of the income has to be deducted towards personal expenses of the deceased which he would have incurred had he been alive. The accident occurred in the year 2007. Hence, if the income is fixed as `5,000/- and 30% is added to the income reckoning future prospects, it would not have made any difference in the multiplicand after deducting the personal expenses. In this case, Tribunal instead of fixing the monthly income as above, took it as `6,500/-and deducted < of the same M.A.C.A.129/2012 & CO.39/2012 21 towards personal expenses. In view of the nature of the arguments advanced and taking note of the fact that we are ordering 'pay and recovery', we are of the view that no interference is called for, with the impugned award as regards the quantum of compensation.

11.In view of our conclusions and findings, an order can be passed in the appeal by issuing a direction to the third respondent- insurance company to pay the amount awarded along with the right to recover the amount paid to satisfy the award.

In view of the discussions as above, the cross objection filed in M.A.C.A.129 of 2012 by respondents 1 and 2 is dismissed and the appeal is allowed to the extent modifying the direction thereunder and consequently, the third respondent is directed to pay the awarded amount viz., `11,71,830/- with 7.5% interest from the date of petition till realisation along with a cost of `23,000/- at the first instance and the third respondent is given right to recover the same in execution of this judgment without taking recourse to any M.A.C.A.129/2012 & CO.39/2012 22 separate proceedings for recovery of the amount. MA.C.A is disposed of, accordingly. In the circumstances, there will be no order as to costs.

Sd/-

(C.T. RAVIKUMAR) JUDGE Sd/-

(MARY JOSEPH) JUDGE spc/

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