Jammu & Kashmir High Court
Oriental Insurance Co. Ltd. vs Ram Parkash And Ors. on 15 March, 1996
Equivalent citations: 1998ACJ452, AIR1997J&K36, AIR 1997 JAMMU AND KASHMIR 36
Author: Bilal Nazki
Bench: Bilal Nazki
JUDGMENT Bilal Nazki, J.
1. This is an appeal filed against the Award of Motor Accident Claims Tribunal, Rajouri, by which he has awarded an amount of Rs. 65,000/- as compensation to the respondents.
2. I have heard the learned counsel for the parties.
3. A preliminary objection has been taken by the counsel for the respondents stating therein that the appeal was not maintainable as only the quantum of compensation has been challenged and the Insurance Company was not within its rights to file an appeal as Insurance Company was not defending the insurer before the Tribunal. He has referred to a Full Bench Judgment of this Court reported in AIR 1982 J&K. 105. This judgment while declaring the law has laid down (paras 37 and 38) :--
"Where an insurer finds that it has not reserved such a right hut that the insured and the claimant have colluded with each other as it is a possibility that cannot be ignored. It is open to an insurer to bring that fact to the notice of the Tribunal and seek its permission under Section 110-C ("A) to contest the claim on all the grounds available to an insured. On being satisfied that there is such a collusion, the Tribunal would grant permission and on such permission being granted, the insurer steps into the shoes of the insured and defends the claim on all available grounds, if the Award goes against the insurer, it can challenge it in appeal also on all such grounds on which it had contended the claim before the Tribunal. Right of appeal against an Award of the Tribunal is the creation of the statute. The Act had confined the right to avoid the liability in the insurer to the injured on certain grounds Specified in it. It is not open to this Court to add to those grounds on the plea that hardship would be caused to the insurer. An insurer can avoid any hardship by remaining vigilant during the trial of the claim petition and also by providing in the policy of insurance, for a right to defend the action in the name of the assured and that he had full liberty to do. Where the insurer has failed to do it, he cannot avoid the liability if the insured is found liable.
38. The aforesaid discussion leads to the conclusion (1) that an insurer is not entitled to resist the claim or the Award, where the insured has been found liable, on grounds not enumerated under Section 96(2) of the Act; (2) where the term of the policy of insurance provides that the insurer has the right to defend the action in the name of the insured the insurer shall have the right to be defend and if he does so, all the defences as arc open to the insured can be urged by the insurer both to resist the claim as well as the Award; (3) if it appears that the. claimant and the insured have colluded, then after receiving permission of the Tribunal under Section 110-C(2A) the insurer can defend the claim as well as the Award on all grounds which are available to the insured; and (4) except for the aforesaid contingencies, an insurer cannot question an Award, in appeal and unless the case of the insurer is covered by (2) or (3) conclusions as noticed above, an insurer cannot, in an appeal against the Award, question the quantum of compensation only."
4. The tests laid down are that where the term of the policy of the insurance provides that the insurer has a right to defend the action in the name of the insured, the insured shall have the right to defend and if he does so, all the defences as are open to the insurer can be urged by the insurer both to resist the claim as well as the award. The law, therefore, would be that where the policy of insurance provides that the insurer has a right to defend the action of the insured and where he exercises this right as the defences available to an insurer will be available to insured also.
5. Although in the memo of appeal, it has been stated by the appellant in para 7 that the appellant Insurance Company has in the policy of insurance reserved its option to undertake the defence on behalf of the insured, but it has nowhere been stated that in fact the Insurance Company exercised this option before the Tribunal, which is also borne by the record which has been examined by me. On the other hand, the counsel for the respondents has submitted that separate defences were filed and different lawyers represented the insured and the Insurance Company before the Tribunal. It is true that an Insurance Company can come into the shoes of the insured and can ensure taking up all the defences which are available to the insured provided they exercised this option. This option has necessarily to be exercised before the Tribunal and it cannot be allowed to be exercised at the appellate stage.
6. For this reason alone, I find that this appeal is not maintainable even otherwise, I am of the view that Rs. 65,600/- which has been paid as compensation for the death of a minor child is not excessive, when the accident took place in terms of Section 140 of the Motor Vehicles Act, the maximum amount that could be awarded as a no-fault liability was Rs. 25,000/-, this also has been amended and the no-fault liability has been enhanced to Rs. 50,000/-. This has not been stated to show that the present case is governed by the amended law but only to show that the Parliament has recognised that the money is losing its value due to various reasons including inflation day in and day out.
7. Keeping these things in mind, I do not think that an amount of Rs. 65,000/- is excessive in case of death of a child. Counsel for the appellant has referred to many judgments where an amount of Rs. 10,000/- or Rs. 15,000/- has been held to be just compensation in case of death of a minor child, but these judgments have been passed number of years before.
8. For these reasons, I do not think any interference is needed, therefore, the appeal is dismissed. At this stage the counsel for respondents submits that some amount has already been deposited in this Court. The Additional Registrar of this Court shall release the amount to the claimant against proper receipt.