Madras High Court
The Oriental Insurance Co. Ltd vs Kamatchi .. 1St on 21 November, 2007
Author: G.Rajasuria
Bench: G.Rajasuria
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 21/11/2007 CORAM: THE HONOURABLE MR.JUSTICE G.RAJASURIA C.M.A.(MD) No.1137 of 2007 C.M.A.(MD) No.1138 to 1139 of 2007 and M.P.(MD)No.2,3,3,3,4 and 4 of 2007 The Oriental Insurance Co. Ltd., City Branch Office, No.16, 401/2-F-1, Swastik Manandi Arcada, Seshadhpuram Police Station, Subedar Chatram Road, Bangalore - 560 020. .. Appellant 2nd RespondentS in all CMAs Vs 1.Kamatchi .. 1st Respondent/petitioner, 2.Mukthiyarpasha .. 2nd Respondent/1st Respondent in C.M.A.No.1137 of 2007 (R2 Exparte in Lower Court) 1.Malaisamy .. 1st Respondent/petitioner. 2.Mukthiyarpasha .. 2nd Respondent/1st Respondent. in C.M.A.No.1138 of 2007 (R2 Exparte in Lower Court) 1.Ramesh .. 1st Respondent/Petitioner. 2.Mukthiyarpasha .. 2nd Respondent/1st Respondent. in C.M.A.No.1139 of 2007 (R2 Exparte in Lower Court) Prayer in all CMAs Appeals filed under Section 173 of Motor Vehicles Act, 1988, against the Judgement and Decree dated 21.10.2005 passed in MCOP.Nos.17, 18 and 19 of 2004 by the learned Motor Accidents Claims Tribunal-cum-the District Judge, Karur. !For Appellant ... Mr.K.Bhaskaran in all C.M.As ^For Respondent ... Mr.N.Sankar Ganesh No.1 in all CMAs :JUDGMENT
These appeals are focussed as against the Judgement and Decree dated 21.10.2005 passed in MCOP.Nos.17, 18 and 19 of 2004 by the learned Motor Accidents Claims Tribunal-cum-the District Judge, Karur.
2. Heard the learned counsel appearing for the appellant as well as the learned counsel appearing for the first respondent in all the C.M.As.
3. When the appeal has come up for hearing, the learned counsel for the appellant/Insurance Company has represented correctly that since the second respondent remained ex-parte before the Tribunal, he is not a necessary party in this appeal.
4. The Tribunal vide Judgement dated 21.10.2005 awarded compensation to the tune of Rs.67,800/- (Rupees sixty seven thousand and eight hundred only), Rs.44,700/- (Rupees forty four thousand and seven hundred only) and Rs.57,300/- (Rupees fifty seven thousand and three hundred only) in M.C.O.P.Nos.17,18 and 19 of 2004 respectively under the following sub-heads:
In M.C.O.P.No.17 of 2004:
For partial permanent disability - Rs.25,000/- For loss of earning capacity - Rs.25,000/-
For pain and sufferings - Rs.10,000/- For medicines - Rs. 7,800/-
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Total - Rs.67,800/-
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In M.C.O.P.No.18 of 2004: For partial permanent disability - Rs.15,000/- For loss of earning capacity - Rs.10,000/-
For pain and sufferings - Rs.10,000/- For medicines - Rs. 9,700/-
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Total - Rs.44,700/-
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In M.C.O.P.No.19 of 2004: For partial permanent disability - Rs.20,000/- For loss of earning capacity - Rs.10,000/-
For pain and sufferings - Rs.10,000/- For medicines - Rs.17,300/-
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Total - Rs.57,300/-
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5. The gist and kernel of the grounds of appeal as stood exposited from the records could be portrayed thus:
The Tribunal has fallen into error in ignoring the terms and conditions of the policy in passing the awards and thereby mulcting the Insurance Company to pay the compensation jointly and severally along with the owner of the vehicle. The Tribunal has not considered the fact that illicit liquor was transported in the said goods vehicle. The injured persons were not loadmen, but they were unauthorised passengers, who were not covered by the insurance policy. The compensation awarded is on the higher side. Accordingly, the learned counsel for the appellant Insurance Company prayed for exonerating the Insurance Company from the liability of in honouring the awards passed in all the three matters.
6. The points for consideration are (i) whether the three injured persons are mere unauthorised passengers or loadmen accompanying the goods in the vehicle? (ii) whether there was any breach of condition of the insurance policy and if so, what are the consequences? and (iii) whether the Tribunal awarded 'just compensation'?
7.Point(i):
A re'sume' of facts absolutely necessary and germane for the disposal of these Civil Miscellaneous Appeals would run thus:
It so happened that on 06.05.2003 at 06.00 p.m., the tempo van bearing registration No.KA-01, A.6475, was proceeding from Bangalore to Karur and while the van was negotiating along the Karur by-pass road, it got capsized due to the rash and negligent driving of the said vehicle and thereby caused injuries to the driver as well as three persons, who were travelling in that van. The three injured persons, who travelled along with the driver filed the claim petitions respectively and accordingly the Tribunal passed awards as set out supra.
8. The learned counsel for the appellant Insurance Company would draw the attention of this Court to the copy of the Insurance policy, which would demonstrate that all types of goods except prohibited goods could be transported in that offending vehicle. The First Information Report would express and expatiate the facts to the effect that in that offending vehicle liquor was transported illegally and thereupon the police while registering the First Information Report invoked the relevant provisions of the Tamil Nadu Prohibition Act. As such placing reliance on the above said facts, the learned counsel for the Insurance Company would develop his arguments to the effect that once there was breach of policy condition, the Court in the event of awarding damages has to adher to the decision of the Hon'ble Apex Court in National Insurance Co., Ltd., vs. Swaran Singh and Others reported in 2004 ACJ 1 and permit the Insurance Company to pay the award amount at the first instance and recover it from the owner of the vehicle concerned, whereas the learned counsel for the respondent No.1/claimants would torpedo the arguments of the learned counsel for the appellant Insurance Company on the main ground that such an argument on the part of the appellant Insurance Company may not be countenanced for the reason that in the counter filed before the Tribunal, there was no plea taken, for which the learned counsel for the appellant Insurance Company would submit that law points can be raised even for the first time before this Court. There can be no quarrel over such a proposition that before the appellate Court law point can be raised for the first instance, but the nature of the plea raised by the appellant Insurance Company for the first time before this Court is that certain factual aspects also have to be analysed. Simply because along with onion bags, liquor bottles were also transported there is no presumption that the owner of the vehicle knowingly permitted his vehicle for being used for transportation of liquor. In such a case, for the first time, the question of law mixed with fact cannot be entertained.
9. The learned counsel for the appellant Insurance Company would also argue that the Insurance Company would extend its coverage only to the driver and two persons. A mere perusal of the policy would evince and evidence the same. Here, the driver is not one among the three claimants and it is therefore obvious that the Insurance Company cannot be compelled to pay the award amounts relating to all the three persons and it could be restricted only to two persons. The question might arise as to which of the two awards out of the three awards could be honoured by the Insurance Company. The decision of the Hon'ble Apex Court in National Insurance Co. Ltd. v. Anjana Shyam & Others reported in 2007(4)CTC 593 clarify the position. An excerpt from it would run thus:
"In spite of the relevant provisions of the statute, insurance still remains a contract between the owner and the insurer and the parties are governed by the terms of their contract. The statute has made Insurance obligatory in public interest and by way of social security and it has also provided that the insurer would be obliged to fulfil his obligations as imposed by the contract and as overseen by the statute notwithstanding any claim he may have against the other contracting party, the owner, and meet the claims of third parties subject to the exceptions provided in Section 149(2) of the Act. But that does not mean that an insurer is bound to pay amounts outside the contract of insurance itself or in respect of persons not covered by the contract at all. In other words, the insured is covered only to the extent of the passengers permitted to be insured or directed to be insured by the statute and actually covered by the contract. The High Court has considered only the aspect whether by overloading the vehicle, the owner had put the vehicle to a use not allowed by the permit under which the vehicle is used. This aspect is different from the aspect of determining the extent of the liability of the Insurance Company in respect of the passengers of a stage carriage insured in terms of Section 147(1)(b)(ii) of the Act. We are of the view that the Insurance Company can be made liable only in respect of the number of passengers for whom Insurance can be taken under the Act and for whom Insurance has been taken as a fact and not in respect of the other passengers involved in the accident in a case of overloading.
Then arises the question, how to determine the compensation payable or how to quantify the compensation since there is no means of ascertaining who out of the overloaded passengers constitute the passengers covered by the insurance policy as permitted to be carried by the permit itself. As this Court has indicated, the purpose of the Act is to bring benefit to the third parties who are either injured or dead in an accident. It serves a social purpose. Keeping that in mind, we think that the practical and proper course would be to hold that the Insurance Company, in such a case, would be bound to cover the higher of the various awards and will be compelled to deposit the higher of the amounts of compensation awarded to the extent of the number of passengers covered by the Insurance Policy. Illustratively, we may put it like this. In the case on hand, 42 passengers were the permitted passengers and they are the ones who have been insured by the Insurance Company, 90 persons have either died or got injured in the accident. Awards have been passed for varied sums. The Tribunal should take into account, the higher of the 42 awards made, add them up and direct the Insurance Company to deposit that lump sum. Thus, the liability of the Insurance Company would be to pay the compensation awarded to 42 out of the 90 passengers. It is to ensure that the maximum benefit is derived by the Insurance taken for the passengers of the vehicle, that we hold that the 42 awards to be satisfied by the Insurance Company would be the 42 awards in the descending order starting from the highest of the awards. In other words, the higher of the 42 awards will be taken into account and it would be the sum total of those higher 42 awards that would be the amount that the insurance Company would be liable to deposit. It will be for the Tribunal thereafter to direct distribution of the money so deposited by the Insurance Company proportionately to all the claimants, here all the 90, and leave all the claimants to recover the balance from the owner of the vehicle. In such cases, it will be necessary for the Tribunal, even at the initial stage, to make appropriate orders to ensure that the amount could be recovered from the owner by ordering attachment or by passing other restrictive orders against the owner so as to ensure the satisfaction in full of the awards that may be passed ultimately".
10. As such adhering to the aforesaid decision of the Hon'ble Apex Court, the awards could be analysed. The Tribunal has awarded compensation to the tune of Rs.67,800/- (Rupees sixty seven thousand and eight hundred only), Rs.44,700/- (Rupees forty four thousand and seven hundred only) and Rs.57,300/- (Rupees fifty seven thousand and three hundred only) in M.C.O.P.Nos.17,18 and 19 of 2004 respectively. As such it is crystal clear that the Insurance Company has to pay the sum of Rs.67,800/- (Rupees sixty seven thousand and eight hundred only) in MCOP No.17 of 2004 and Rs.57,300/- (Rupees fifty seven thousand and three hundred only) in M.C.O.P.No.19 of 2004 in compliance with the policy issued by it and the total of both these amounts come to 67,800+57,300=Rs.1,25,100/- (Rupees one lakh twenty five thousand and one hundred only) which shall be divided proportionately and given to the three claimants and for the remaining amounts due under the awards it is for the claimants to enforce the award straight away from the owner of the vehicle.
11. In respect of compensation awarded under sub heads in three cases, appropriate amounts have been awarded, which require no interference.
12. No other points urged before me.
13. In the result, these Civil Miscellaneous Appeals are partly allowed and the awards of the Tribunal are confirmed, which shall carry interest at the rate of 7.5% and the appellant Insurance Company has to pay the sum of Rs.67,800/- (Rupees sixty seven thousand and eight hundred only) in MCOP No.17 of 2004 and Rs.57,300/- (Rupees fifty seven thousand and three hundred only) in M.C.O.P.No.19 of 2004, totally Rs.1,25,100/- (Rupees one lakh twenty five thousand and one hundred only) in compliance with the policy issued by it and which amount shall be divided proportionately and given to the three claimants and for the remaining amount due under the awards it is for the claimants to enforce the award straight away from the owner of the vehicle. No costs. Consequently, connected Miscellaneous Petitions are closed.
To The Motor Accidents Claims Tribunal cum the District Judge, Karur.
smn/dm