Madhya Pradesh High Court
Oriental Insurance Co. Ltd. vs Bare Lal And Ors. on 28 November, 1996
Equivalent citations: II(1998)ACC392, 1998ACJ248
Author: D.M. Dharmadhikari
Bench: D.M. Dharmadhikari
JUDGMENT D.M. Dharmadhikari, J.
1. This appeal under Section 173 of the Motor Vehicles Act, 1988 has been preferred by the appellant insurance company against the award dated 12.1.1996 of the Motor Accidents Claims Tribunal, Umaria, Distt. Shahdol.
2. Bare facts necessary for decision of this appeal are as follows: The deceased Raju aged 16 years who was employed as a labourer for the work of loading and unloading on truck No. MPL 3232 met with a motor accident and lost his life on 22.3.1988. The Claims Tribunal awarded a total sum of Rs. 2,20,608/- as compensation to the claimant-respondent No. 1 who is father of the deceased. The above quantum of compensation was on the basis that the deceased was earning Rs. 16/-per day and would have lived minimum for another 44 years. Multiplying the estimated yearly income by 44, the above amount of compensation has been determined as payable jointly and severally by the owner, driver and insurance company.
3. Mr. B.D. Jain, learned Counsel who appeared for the insurance company, questioned the correctness of the quantum of compensation determined by the Claims Tribunal and argued that it is per se excessive and against settled principles. It is submitted that a multiplier of 44 taken is too high when the maximum multiplier which has been applied by courts is 16. No doubt, the quantum of compensation determined by taking multiplier of 44 appears to this Court as extremely high and against the settled formula of working out the compensation. This court, however, cannot go into the question of quantum of compensation in an appeal preferred by the insurance company because the defences of the insurance company are limited by the provisions of the Act. Two Division Benches of this Court have taken the view that as the defences of insurance company are restricted before the Claims Tribunal, such restrictions with regard to it would also apply to the rights of the insurance company in appeal. [See: United India Insurance Co. Ltd. v. Pratibha Rathi 1995 ACJ 819 (MP) and National Insurance Co. Ltd. v. Kamarjahan 1995 ACJ 1150 (MP)].
4. As the defences of the insurance company are restricted, we allowed the learned Counsel for the appellant to raise grounds with regard to the alleged breach of the conditions of the insurance policy and its limited liability under the terms of the said policy.
5. On the question of the alleged breach of conditions of the policy, on behalf of the appellant the learned Counsel invited attention to the contents of photocopy of the driving licence of the driver (respondent No. 3 Chhanga). It is on record and appears to have been filed by the claimants in reply to the plea in that regard taken by the insurance company. It is submitted that the aforesaid driving licence shows that during the period 3.9.1984 to 2.9.1989, the driver possessed licence only to drive light motor vehicles and had no valid licence to drive heavy motor vehicles such as the truck. It is submitted that for want of valid driving licence, the insurance company is absolved of its liability by commission of the breach of the terms of the policy.
6. The above argument advanced cannot be accepted for two reasons. We have carefully examined the contents of the photocopy of the driving licence which is on record. It has not been exhibited in the evidence and nobody has been examined either on behalf of the insurance company or on behalf of the owner or driver to prove the alleged fact of the driver not possessing licence to drive heavy motor vehicles at the relevant time. On a closer examination of the contents of the licence, we find that it was valid for 3.9.1984 to 2.9.1989 and was renewed up to 28.12.95. In the first part for description of vehicle, the entries regarding all other categories of vehicles have been scored out and the entry mentioning 'light motor vehicle' has been tick marked. In the licence, however, there is an entry against entry (f) mentioning 'the category of vehicles to be mentioned in other part of the licence'. Thereafter there is a typed entry reading thus: "Authorisation to drive a transport vehicle, 'the driver is authorised to drive a public carrier vehicle within the date'." It is not clear from the contents of the licence that the abovementioned entry did not exist in the licence right from the beginning, i.e., from 3.9.1984 when the licence was issued. In the absence of any evidence on record on behalf of the insurance company, it cannot be held on the basis of licence on record that the driver did not possess a valid licence to drive heavy motor vehicles on the date of incident.
7. Even accepting the submission made by the insurance company that the driver on the relevant date did not possess a valid licence to drive heavy vehicles, such a plea cannot be accepted. Only want of skill to drive a heavy motor vehicle was not the direct cause of the accident. The evidence on record shows that the truck was proceeding in speed and turned turtle while taking a turn. It is nobody's case that the driver was not used to driving a truck. The Supreme Court in B.V. Nagaraju v. Oriental Insurance Co. Ltd. 1996 ACJ 1178 (SC), has approved its own decision in Skandia Insurance Co. Ltd. v. Kokila-ben Chandravadan 1987 ACJ 411 (SC) and held that the terms of the insurance policy have to be read down to serve the main purpose of the policy and unless it is proved that there has been such a fundamental breach of the conditions of the policy which contributed to the causing of accident, the insurance company cannot be held as absolved from its liability to indemnify the insured.
8. Learned counsel for the insurance company then submitted that the Tribunal completely lost sight of the fact that the liability of the insurance company was limited to a sum of Rs. 1,50,000/- in respect of death of an employee other than driver carried in the vehicle. The case of the insurance company was that more than six persons were being carried in the vehicle as employees. Even if that be so, as held in the case of B.V. Naga raju v. Oriental Insurance Co. Ltd. 1996 ACJ 1178 (SC), by the Supreme Court, merely carrying of more than permitted number of employees in the vehicle was not such a fundamental breach of the policy as to absolve the insurance company from its duty to indemnify the owner of the vehicle, i.e., the insured. We have looked into the contents of the terms of the insurance policy and we have found that so far as the employees, six in number, who could be carried in the vehicle are concerned, the liability of the insurance company is limited by the provisions of Section 95(2)(a) of the Motor Vehicles Act 1939, which was in force at the relevant time. The provision reads as under:
95. Requirements of policies limits of liability.
(1) XXX XXX XXX (2) Subject to the proviso to Sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely
(a) where the vehicle is a goods vehicle, a limit of one lakh and fifty thousand rupees in all, including the liabilities, if any, arising under the Workmen's Compensation Act 1923, in respect of the death of, or bodily injury to, employees (other than the driver), not exceeding six in number, being carried in the vehicle.
9. We have also heard Mr. J.K. Agnihotri, Advocate for the respondent No. 1 and Mr. Manoj Dube, Advocate appearing for respondent No. 2, the owner of the vehicle. The counsel appearing for the respondents supported the award.
10. In view of the discussion aforesaid, the appeal preferred by the insurance company only partly succeeds. The award of the Claims Tribunal dated 12.1.1996 is maintained, but modified only by making a direction that the liability of the appellant insurance company shall be limited to Rs. 1,50,000/- with roportionate interest and costs. The remaining amount of compensation shall be payable by the owner of the vehicle, respondent No. 2, and the driver of the vehicle, respondent No. 3. The costs of this appeal shall be borne by the parties as incurred.