Himachal Pradesh High Court
Oriental Insurance Co. Ltd. vs Dhalu Devi And Ors. on 7 May, 1996
Equivalent citations: II(1998)ACC433, 1998ACJ210
Author: Arun Kumar Goel
Bench: Arun Kumar Goel
JUDGMENT Kamlesh Sharma, J.
1. These appeals (F.A.O. Nos. 7 and 10 of 1991) have been filed at the instance of Oriental Insurance Co. against the award dated 22.8.1990 whereby two claim petitions (Claim Petition Nos. 3 and 4 of 1989), arising out of the same accident, were decided. Hence, both these appeals are being disposed of by a common judgment.
2. The facts in brief are that a tractor HIL 4605 owned by respondent Khoob Ram and driven by respondent Roshan Lal met with an accident on 29.11.1988 at a place known as Thalot situated on the Mandi-Kullu National Highway in which Nand Lai aged 18 years and Beli Ram aged 19 years had died. Mother of Nand Lal, namely, Dhalu Devi filed claim petition No. 3 of 1989 whereas parents of Beli Ram, namely, Mohan Lai and Teji preferred Claim Petition No. 4 of 1989. Both these petitions were consolidated by order dated 17.2.1990 and thereafter their joint trial was held.
3. The case set up in the claim petitions was that deceased Nand Lai and Beli Ram were working as labourers at the crusher owned by one Gopal Sharma who had hired the tractor HIL 4605 for carrying the stones from village Thalot on wages. On the date of occurrence while stones were being carried in the tractor to the said crusher both the deceased were sitting on it when it fell down the road resulting in their death. It is also stated that another person, namely, Sunder PW 5, was also travelling in the tractor but he saved his life by jumping out of it when it rolled down. As per the claimants-respondents the accident had taken place due to rash and negligent driving of the respondent Roshan Lai, the driver of the tractor.
4. In their joint reply both Khoob Ram, the owner of the tractor and Roshan Lai, the driver thereof, have denied the allegations made in the claim petition that the deceased were working as labourers at the crusher of Gopal Sharma who had hired the tractor for carrying the stones and also that tractor was going to his crusher when it met with the accident as a result of rash and negligent driving of its driver Roshan Lal. It is stated that at the time of accident nobody was sitting in the tractor. The accident had taken place due to sudden mechanical defect developed in the tractor as a result of which its front wheel came out of the axle and it took the turn and rolled down the road and at that place "two persons were found injured. It appears that those persons might be sitting by the side of the road at the time and place of accident. Therefore, either they themselves jumped from the road or fell down below the road." The other allegations about the income of the deceased and dependency of the respondents-claimants were also denied. The respondent insurance company filed a separate reply and took preliminary objection that particulars of insurance policy were not disclosed in the petitions, as such, they could not file effective reply and that the tractor which is exempted from token tax was meant only for carrying agriculture and forest produce and since it was carrying passengers at the time of accident it committed breach of the terms and conditions of insurance policy absolving the insurance company from its liability. On merits the accident was denied on the ground that the owner failed to lodge third party claim as well as his own vehicle damage claim. It is reiterated that since there was a breach of terms and conditions of insurance policy and the vehicle was not being used for the purpose it was insured and carrying gratuitous passengers, the insurance company was not liable to indemnify the insurer.
5. On the pleadings of the parties the following issues were framed in Claim Petition No. 4 and Claim Petition No. 3 respectively:
(1) Whether Beli Ram died on account of the rash and negligent driving of the tractor bearing No. HIL 4605 driven by respondent No. 2 Roshan Lal? OPP (2) Whether said tractor was insured with respondent No. 3, if so its effect? OPP (3) Whether the petitioners are entitled to claim a sum of Rs. 1,50,000/-? If so, who is liable to pay? OPP (4) Whether the respondent Nos. 1 and 2 committed breach of the insurance policy? If so, what was the breach and what is its effect?
(5) Relief.
(1) Whether Nand Lai died on account of the rash and negligent driving of the tractor bearing No. HIL 4605 driven by respondent No. 2 Roshan Lai? OPP (2) Whether said tractor was insured with respondent No. 3, if so its effect? OPP (3) Whether the petitioners are entitled to claim a sum of Rs. 1,50,000/-? If so, who is liable to pay? OPP (4) Whether the respondent Nos. 1 and 2 committed breach of the insurance policy? If so, what was the breach and what is its effect?
(5) Relief.
6. Issue Nos. 1 and 2 in both the petitions were answered in affirmative. In answer to issue No. 3 in both the petitions an amount of Rs. 54,000/- each was awarded. Issue No. 4 was decided against the insurance company that Khoob Ram, owner of the tractor and Roshan Lal, driver of the tractor had not committed any breach of insurance policy. While recording its findings on issue Nos. 3 and 4, the Motor Accidents Claims Tribunal has ignored the allegations of the respondents-claimants that deceased Nand Lai and Beli Ram were working as labourers on the stone crusher of Gopal Sharma and the tractor in question was being engaged for carrying stones. In view of the statements of owner of the tractor Khoob Ram, RW 1, driver of the tractor Roshan Lai, RW 2, and Khub Ram, son of Mani Ram, the Manager of the crusher, RW 3, it is held that since the accident has taken place near the stone crusher, respondents-claimants have presumed that it was engaged for carrying the stones to the stone crusher. Moreover, in the absence of any material placed on record that the tractor was being plied for hire and reward, the defence of the insurance company is rejected and it is held liable to indemnify the insured. It is further held by the Motor Accidents Claims Tribunal that insurance company has failed to prove that the tractor in question was being used for any other purpose than for agriculture purpose, as mentioned in the insurance policy, in contravention of the terms and conditions of the insurance policy. These findings have been seriously challenged in these appeals.
7. The findings of the Motor Accidents Claims Tribunal on issue No. 1 that the accident had taken place due to rash and negligent driving of Roshan Lai, the driver of the tractor, have become final and cannot be subject matter of challenge in the present appeals filed on behalf of the insurance company. In view of the insurance policy Exh. P-4 and the registration certificate of the tractor Exh. P-5 on record the insurance company cannot agitate that the said tractor was not insured with it. Moreover, S.S. Awasthi, RW 4, who was working as Divisional Manager of the appellant insurance company, has admitted in his statement that the tractor in question was insured for agriculture purpose and besides driver no body could sit in it. He had placed the insurance policy Exh. P-4 on record.
8. Mr. G.C. Gupta, learned Counsel for the appellant insurance company, has urged that in view of the allegations made in the claim petitions as well as specific statements of Mohan Lai, PW 3, father of Beli Ram, Dhalu Devi, PW 4, mother of Nand Lal, Sunder, PW 5, co-passenger in the tractor at the time of accident and the contents of F.I.R. Exh. P-1, the Motor Accidents Claims Tribunal is not justified in holding that the tractor in question was not engaged for carrying stones to the stone crusher of Gopal Sharma and the deceased were not engaged as labourers at the said stone crusher and were travelling in the tractor at the time of the accident in that capacity. Referring to the insurance policy, Exh. P-4, Mr. Gupta has pointed out that specific limitation to the use of the tractor was put in the insurance policy as it is clear from the words, 'agriculture tractor only' typed against the column limitation as to use on the front page of the insurance cover, therefore, the breach of the terms and conditions of the insurance policy is proved absolving the appellant insurance company from indemnifying the insured. He has also referred to Section II, Clause 1 which provides that the liability of the insurance company to indemnify the insured is subject to the limits of liability as agreed between the insured and the insurance company. In support of his arguments Mr. Gupta has relied upon a number of judgments which we will discuss in the later portion of our judgment. On the other hand, learned Counsel appearing for respondents, have supported the findings of Motor Accidents Claims Tribunal on issue No. 4 that respondents Khoob Ram, owner of the tractor, and Roshan Lal, driver thereof, have not committed breach of any condition of insurance policy which exonerate the insurance company from its liability to indemnify them. According to leained counsel for respondents, the tractor was not engaged at the stone crusher of Gopal Sharma for the purpose of carrying stones as stated in the claim petitions and the claimants themselves and witnesses produced by them but it was going to fetch manure when it rolled down below the road as a result of sudden mechanical defect developed in it as stated by respondents Khoob Ram and Roshan Lai who appeared as RW 1 and RW 2 and also by Khub Ram, RW 3, the Manager at the stone crusher of Gopal Sharma.
9. After giving our best consideration to the respective submissions made by the learned Counsel for the parties, we find ourselves unable to agree to the findings arrived at by the Motor Accidents Claims Tribunal that since the accident had taken place near the stone crusher of Gopal Sharma, the respondents-claimants had presumed that the tractor was hired by Gopal Sharma at his crusher and also that it was not being used for hire and reward in violation of the specific condition in the insurance policy, Exh. P-4. We find that the respondents-claimants who are the parents of the deceased Nand Lal and Beli Ram were the best persons to state where their sons were working and there are no reasons to disbelieve their statements in the claim petition as well as in the court on oath as Mohan Lai, PW 3, father of Beli Ram and Dhalu Devi, PW 4, mother of Nand Lal that their sons were working for wages as labourers at the stone crusher of Gopal Sharma for collecting stones which used to be carried in the tractor HIL 4605 hired by Gopal Sharma for the purpose.
They have taken a definite stand in this regard and have categorically stated that at the time when the tractor No. HIL 4605 met with the accident stones were being carried in it and Beli Ram and Nand Lal were also sitting therein. Their version is fully corroborated by Sunder, PW 5, who was not only travelling with them at the time of accident but was also working like them at the stone crusher of Gopal Sharma and he had saved himself by getting down from the tractor when it was being driven at a high speed. The statements of these witnesses further find support from the F.I.R. Exh. P-1 which was got recorded, immediately after the accident, by one Rajinder Kumar, driver of another tractor No. HPM 795 engaged at the stone crusher of Gopal Sharma. In the F.I.R. Rajinder Kumar had reported that a tractor No. HIL 4605 being driven by respondent Roshan Lal rashly and negligently had rolled down the road in which the deceased Nand Lal and Beli Ram and Sunder, PW 5, were travelling and out of them Nand Lal and Beli Ram had received injuries and they were taken to hospital at Mandi by Gopal Sharma, owner of the crusher. This F.I.R. Exh. P-1 was produced by Head Constable Hem Singh and investigation of the case was conducted by Sub Inspector Sawan Singh who has categorically stated that at the time of accident Sunder was sitting in the tractor who had told him that accident had happened as all of a sudden one tyre of the tractor had become free. He has denied that at the relevant time tractor was engaged at the stone crusher of Gopal Sharma though according to him he had received information that the labourers who had died in the accident were working with Gopal Sharma. Since as per his investigation, the accident had not occurred due to negligence of anybody, he had reported the matter for cancellation of F.I.R. Roop Lal, mechanic of Police Department, has appeared as RW 5 to depose that tractor No. HIL 4605 met with an accident as its right wheel had come out which is a mechanical defect.
10. No doubt, to prove their case, the respondents Khoob Ram and Roshan Lal have produced Khub Ram, son of Mani Ram, RW 3, who has stated that he was working as Manager at the stone crusher of Gopal Sharma for the last six years and to mark the presence of labourers and to distribute them their wages was part of his duties. According to him, deceased Nand Lal and Beli Ram were not working at the stone crusher but his statement does not inspire confidence as he failed to produce the attendance register which was admittedly being maintained by him. He was also not able to give the number of tractors engaged at the crusher and also the number of workers working there and answer other relevant questions which shows that he was intentionally withholding this information to help respondents Khoob Ram and Roshan Lal. In fact, Gopal Sharma was the best person to depose whether deceased Nand Lal and Beli Ram were working at his stone crusher on wages for collecting stones which used to be carried in tractor No. HIL 4605 besides other tractors engaged by him at his stone crusher but his evidence has been withheld which forces us to draw an inference that had Gopal Sharma been produced he would not have supported the respondents Khoob Ram and Roshan Lai.
11. In the totality of facts and circumstances on record, we have no hesitation to hold that deceased Nand Lal and Beli Ram were working at the stone crusher of Gopal Sharma and were travelling in that capacity in tractor No. HIL 4605 at the time of accident which was engaged by Gopal Sharma, the owner of the stone crusher.
12. The next question arises whether respondent Khoob Ram, the owner of the tractor, has breached any of the conditions of insurance policy, Exh. P-4 by getting his tractor engaged at the stone crusher of Gopal Sharma for carrying stones. The perusal of the insurance policy, Exh. P-4, shows that on its front page against the words limitation as to use, the words 'agriculture tractor only' have been typed out and on the 3rd page under the heading Section-II, 'liability to third parties', the following has been printed:
1. Subject to the limits of liability the company will indemnify the insured against all sums including the claimants cost and expenses which the insured shall become legally liable to pay in respect of (i) death of or bodily injury to any person caused by or arising out of the use (including the loading and/or unloading) of the motor vehicle (ii) damage to property caused by the use (including the loading and/or unloading) of the motor vehicle provided always that
(a) The company shall not be liable in respect of death, injury or damage caused or arising beyond the limits of any carriageway or thoroughfare in connection with the bringing of load to the motor vehicle for loading thereon or the taking away of the load from the motor vehicle after unloading therefrom.
(b) Except so far as is necessary to meet the requirements of Section 92-A and Section 95 of the Motor Vehicles Act, 1939 the company shall not be liable in respect of death of or bodily injury to any person in the employment of the insured arising out of and in the course of such employment.
(c) Except so far as necessary to meet the requirement of Section 95 of the Motor Vehicles Act, 1939 in relation to liability under the Workmen's Compensation Act, 1923 the company shall not be liable in respect of death of or bodily injury to any person (other than a passenger cairied by reason or in pursuance of a contract of employment) being carried in or upon or entering or mounting or alighting from the motor vehicle at the time of the occurrence of the event out of which any claim arises.
(d) The company shall not be liable in respect of damage to property belonging to or held in trust by or in the custody or control of the insured or a member of the insured's household or being conveyed by the motor vehicle.
(e) The company shall not be liable in respect of the damage to any bridge and/or viaduct and/or any road and/or anything beneath by vibration or by the weight of the motor vehicle and/or load carried by the motor vehicle.
(f) The company shall not be liable in respect of damage to property caused by sparks or ashes from the motor vehicle or caused by or arising out of explosion of boiler of the motor vehicle.
(g) The company shall not be liable in respect of death or bodily injury caused by or arising out of the explosion of the boiler of the motor vehicle unless such death or injury is caused by or arising out of the use of the vehicle in a public place in India within the meaning of the Motor Vehicles Act, 1939.
On the next page under the heading 'General Exceptions':
The company shall not be liable under this policy in respect of:
(1) any accident loss, damage and/or liability caused, sustained or incurred outside the geographical area;
(2) any claim arising out of any contractual liability;
(3) any accident, loss, damage and/or liability caused, sustained or incurred whilst the motor vehicle is:
(a) being used otherwise than in accordance with the limitations as to use; or
(b) being driven by any person other than a driver;
(4) any accident loss or damage and/or liability caused, sustained or incurred after any variation in or termination of the insured's interest in the motor vehicle;
(5) (a) any accident loss or damage to any property whatsoever or any loss or expense whatsoever resulting or arising there from any consequential loss;
(b) any liability of whatsoever nature directly or indirectly caused by or contributed to by or arising from ionising radiation or contamination by radioactivity from any nuclear fuel or from any nuclear waste from the combustion of nuclear fuel. For the purposes of this exception combustion shall include any self-sustaining process of nuclear fission;
(6) any accident loss or damage or liability directly or indirectly caused by or contributed to by or arising from nuclear weapons material;
(7) any accident loss, damage or liability caused, sustained or incurred during the period of requisition or commandeering by the Government for any purpose.
13. Referring to the limitations as to use which is as 'agriculture use only' and general exception-3 that any accident, loss, damage and/or liability caused, sustained or incurred while the motor vehicle is being used otherwise than in accordance with the limitations as to use. Mr. G.C. Gupta, learned Counsel for the appellant, has urged on behalf of the appellants that since the tractor No. HIL 4605 was engaged for carrying stones at the stone crusher of Gopal Sharma, the insurance company is not liable to indemnify the insured Khoob Ram, respondent. In order to appreciate this submission we will refer to a judgment of Supreme Court in Skandia Insurance Co. Ltd. v. Kokila-ben Chandravadan 1987 ACJ 411 (SC), wherein the question before the court was that if a breach is committed of a condition in the insurance policy, "excluding driving by a named person or persons or by any person who is not fully licensed, or by any person who has been disqualified for holding or obtaining a driving licence during the period of disqualification," can insurance company claim immunity against this obligation to satisfy the judgment against the insured in respect of third party risk in the context of Section 96(2)(b)(ii) of Motor Vehicles Act, 1939. Answering the question, the learned Judges held in para 12 of the judgment as under:
The defence built on the exclusion clause cannot succeed for three reasons, viz:
(1) 'On a true interpretation of the relevant clause which interpretation is at peace with the conscience of Section 96, the condition excluding driving by a person not duly licensed is not absolute and the promisor is absolved once it is shown that he has done everything in his power to keep, honour, and fulfil the promise and he himself is not guilty of a deliberate breach.
(2) Even if it is treated as an absolute promise, there is substantial compliance therewith upon an express or implied mandate being given to the licensed driver not to allow the vehicle to be left unattended so that it happens to be driven by an unlicensed driver.
(3) The exclusion clause has to be 'read down' in order that it is not at war with the 'main purpose' of the provisions enacted for the protection of victims of accidents so that the promisor is exculpated when he does everything in his power to keep the promise.
So far the present case is concerned, we have to consider whether the condition of insurance policy breached by the insured is permissible in the context of Section 96(2)(b)(i) which provides that:
(b) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:
(i) a condition excluding the use of the vehicle
(a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or
(b) for organised racing and speed testing, or
(c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or
(d) without side-car being attached, where the vehicle is a motor cycle;
14. Apparently under Sub-clause (b)(i) of Sub-section (2) of Section 96 of the Act, breach of a specified condition of the insurance policy excluding the use of the vehicle for the purposes stated under Sub-clauses (a) to (d) permit the insurance company to deny their liability but the question arises whether the limitations as to use as 'agriculture tractor only' as put in the insurance policy, Exh. P-4, is included in Sub-clause (i)(a) of Sub-section 2(b) of Section 96 of the Act. There can be no dispute that by putting limitation as to use for agriculture purpose only, the tractor could not be engaged at the stone crusher of Gopal Sharma for hire and reward, as such, the insured has definitely breached a specific condition in the insurance policy on the basis of which the insurance company can claim its exoneration under Clause 3 of General Exceptions that liability was incurred while the tractor was being used for other than the limitations as to use. Since the tractor could not be engaged for carrying stones for hire and reward which was a commercial purpose and not an agriculture purpose the liability incurred by its accident during the period it was so engaged is definitely of the owner of the tractor but he could not pass it on to the insurance company as he himself has contracted out as per the specific condition in the insurance policy which is permissible under Sub-section 2(b)(i)(a) of Section 96. For taking this view, we have taken support from Oriental Insurance Co. Ltd. v. Bishan Dass 1988 ACJ 106 (HP); Sajjan Singh Laxman Singh v. Phoolibai 1993 ACJ 586 (MP); New India Assurance Co. Ltd. v. Sheela Rani 1988 ACJ 206 (Rajasthan); Kaushalya Devi v. Dr. Lakhbir Sood 1994 ACJ 12 (HP); and Baldev Raj v. Dharmo Rani 1990 ACJ 601 (P&H).
15. The result of the above discussion is that we set aside the findings of Motor Accidents Claims Tribunal, Mandi, that the appellant insurance company is liable to indemnify respondent Khoob Ram, insured, the owner of tractor No. HIL 4605 for the amount of compensation awarded to respondents-claimants for the death of their sons in the accident of said tractor. The respondents-claimants are entitled to claim the compensation amount awarded to them from respondents Khoob Ram and Roshan Lai who are jointly and severally liable for the same being owner and driver of the vehicle.
16. Therefore, these appeals are allowed and the impugned award dated 22.8.1990 passed by the Motor Accidents Claims Tribunal (II), Mandi, is set aside against the appellant Oriental Insurance Co. Ltd. but affirmed against Khoob Ram and Roshan Lal, respondents, who have not challenged it by filing any appeal. Costs easy.
17. The appellant insurance company has deposited only a sum of Rs. 25,000/-in each of the appeals against the awarded amount, which amount is invested in fixed deposits. However, the interest accrued thereon had been ordered to be released in favour of the respondents vide order dated 4.10.1994 (in F.A.O. No. 7 of 1991) and vide order dated 5.7.1995 (in C.M.P. No. 285 of 1995 in F.A.O. No. 10 of 1991). In the facts and circumstances of the case and in the interest of justice and fair play, we direct that the amount of Rs. 25,000/-deposited by the insurance company in each of the appeals be refunded to them but the amount of interest accrued thereon till today be paid to the respondents-claimants.