Gujarat High Court
Oriental Insurance Co Ltd vs Sarojben Ghanshyambhai Siroya on 9 August, 2023
NEUTRAL CITATION
C/FA/973/2015 JUDGMENT DATED: 09/08/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 973 of 2015
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE J. C. DOSHI
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1 Whether Reporters of Local Papers may be allowed No
to see the judgment ?
2 To be referred to the Reporter or not ? No
3 Whether their Lordships wish to see the fair copy No
of the judgment ?
4 Whether this case involves a substantial question No
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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ORIENTAL INSURANCE CO LTD
Versus
SAROJBEN GHANSHYAMBHAI SIROYA & 3 other(s)
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Appearance:
MR RATHIN P RAVAL(5013) for the Appellant(s) No. 1
MR. HJ KARATHIYA(7012) for the Defendant(s) No. 4
MR.HIREN M MODI(3732) for the Defendant(s) No. 1,2,3
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CORAM:HONOURABLE MR. JUSTICE J. C. DOSHI
Date : 09/08/2023
ORAL JUDGMENT
1. This First Appeal under section 173 of the Motor Vehicles Act (in short 'the Act') is filed by the Oriental Insurance Company Limited (in short 'the Insurance Company') questioning Page 1 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined correctness of the common judgment dated 07.10.2014 passed by the MACT (Auxi.), Anand in MACP No.1 of 2016 with MACP No.2 of 2006. This Appeal essentially challenges judgment and award passed in MACP No.2 of 2006 which is partly allowed holding that Insurance Company is vicariously liable to pay compensation in tune of Rs.6,39,400/- with interest @ 9% from the date of filing claim petition till realization with proportionate costs to original claimants.
2. Facts leading to filing of this Appeal can be pithily stated as under :-
3. On 19.01.2006, deceased Ghanshyambhai Siroya along with Nayankumar Siroya were travelling in Utility Van bearing No.GJ-1-AT-4938 (in short 'Utility Van'). They were travelling from Rajkot to Tarapur. It is alleged that driver of the Utility Van was driving in rash, negligent and excessive speed and during such driving, he lost control over steering which resulted into capsized of the Utility Van. Deceased Ghanshayambhai traveling in Utility Van was seriously injured and succumbed to injury on the spot. This accident has been recorded with the police and complaint is registered against driver of the Utility Van.
3.1. On the background of above facts of road accident, heirs and legal representative of deceased preferred claim petition under section 166 of the M.V.Act being MACP No.2 of 2006 before the learned Tribunal inter-alia claiming that at the time of road accident, deceased Ghanshayambhai was hale and hearty and was doing agriculture as well as doing business of furniture and used to earn Rs.6,000/- per month. Upon demise of Page 2 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined Ghanshaymbhai, claimants are facing financial crunch and have lost future income as well as love and affection of the deceased. The claim was made to the tune of Rs.8,00,000/- with interest and costs, jointly and severally from the driver, owner and Insurance company of the Utility Van.
4. After assessing evidence on record, produced by the claimants, learned Tribunal reached to the conclusion that the claimants have made out case. The learned Tribunal assessed income of Rs.3200/- after deducing personal expenses and taking age of the deceased as 35 years relying on PM Note, applied multiplier of 16 and assessed future loss of income at Rs.6,14,400/-. Rs.10,000/- was awarded towards loss of consortium, Rs.10,000/- was awarded towards loss of love and affection, whereas Rs.5,000/- was awarded towards funeral expenses. In total, the claimants were granted compensation of Rs.6,39,400/-. This award has been challenged by way of this Appeal.
5. Heard learned advocate Mr. Rathin Raval for the Insurance Company and learned advocate Mr.Hiren Modi for the original claimants. None remain present for other respondents.
6. Learned advocate Mr.Rathin Raval has taken this Court through oral evidence of the petitioner produced on record at Exh.19 to submit that even according to chief examination of the claimant, deceased - Ghanshaymbhai was travelling in Utility Van in capacity of passenger. He would submit that it is undeniable aspect that Utility Van was goods carriage vehicle. He would further submit that risk of persons travelling in goods Page 3 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined carriage vehicle is not covered in the policy. Taking this Court through Exh.Mark -34/1, leaf of policy of vehicle, he would submit that vehicle in which deceased Ghanshayambhai was travelling was goods carriage commercial vehicle. Drawing attention of this Court to the limitation stated in the leaf of the policy, he would submit that vehicle was used for carrying goods withing the meaning of M.V.Act. He would submit that column which indicates premium charged by the Insurance Company does not cover any risk of passenger travelling in the goods carriage vehicle. In that circumstances, he would submit that since deceased Ghanshyambhai was travelling as passenger in the Utility Van being goods carriage vehicle, his risk was not covered. Thus, liability of Insurance Company does not arise. It is only liability of the owner and driver of the Utility Van to satisfy the award.
6.1. Assailing finding of learned Tribunal, more particularly at page 13 of the impugned judgment, he would submit that learned Tribunal has totally misread the policy. He would further submit that learned Tribunal erroneously believed that charging of premium of Rs.294 towards extra premium would cover extra liability of covering risk of the passenger. He would further submit that another serious error arrived by the learned Tribunal is that as per RC Book sitting capacity of Utility Van was that of 3 persons but while referring RC Book learned Tribunal has failed to refer column of charging premium stated in the policy at Exh.Mark34/1 which indicates that premium for legal liability of employee / driver is taken and not of any other persons. Learned advocate Mr. Rathin Raval in this circumstances would submit that learned Tribunal has erred in Page 4 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined fastening liability on Insurance Company. Learned advocate Mr. Rathin Raval would further submit that deceased Ghanshaymbhai was travelling in capacity as passenger in Utility Van, his risk was not covered and since his risk was not covered, Insurance Company is not liable to indemnify liability of driver and owner. Learned advocate Mr. Rathin Raval relied upon judgment in the case of National Insurance Company v/s. Cholleti Bharatamma [AIR 2008 SC 484]. He has also relied on the judgment in the case of New India Assurance Company Ltd. v/s. Vedwati [AIR 2007 SC 1334] to exoneration of the Insurance Company from liability to pay compensation. However, learned advocate Mr. Rathin Raval in utter fairness submitted that Insurance Company is not disputing on the issue of road accident, involvement of the vehicle in the road accident as well as compensation assessed by the learned Tribunal.
7. On the other hand, learned advocate Mr. Hiren Modi would submit that before learned Tribunal to prove contents of insurance policy, insurance company has not examined any person. He would submit that even driver and owner of the vehicle did not step into witness box to contest claim petition. He would further submit that in background of this aspect, learned Tribunal has assessed how Insurance Company is liable to pay compensation pinpointing reasons assigned by the learned Tribunal in impugned judgment, which earmark responsibility of Insurance Company. He would submit that learned Tribunal has rightly noted that premium of Rs.249 has been charged by the Insurance Company as extra premium. He would submit that charging of extra premium of Rs.249 covers liability of passengers travelling in Utility Van. He would submit that Page 5 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined learned Tribunal has assessed all this aspects correctly and justly. Placing reliance on judgment of this Court in the case of United India Insurance Co. Ltd. v/s. Janubhai Radvabhai Vasava [First Appeal No.1975 of 2005 with allied matters], he would submit that even if it is believed that deceased was travelling as gratuitous passenger in goods carriage vehicle, order of 'pay and recovery' can be passed. For the same proposition, learned advocate Mr. Modi also pressed into service judgment of the Apex Court in the case of Manuara Khatun and Ors. v/s. Rajesh Kumar [2017 (4) SCC 796]. He would submit that even if Insurance Company is exonerated from liability to pay compensation under the principle of pay and recovery, Insurance Company should be dissected to pay compensation at fist instance to the claimants and recover the same from the driver and owner of the Utility Van. This submission has been canvassed to dismiss the appeal.
8. No other and further submission are canvassed.
9. Having heard learned advocates for both the sides, at the outset, let refer findings of Apex Court in the case of New India Assurance Company Ltd. v/s. Vedwati (supra). The Apex Court observed and held in regard to passenger travelling in goods vehicle as follows :-
"13. The difference in the language of "goods vehicle" as appear in the old Act and "goods carriage" in the Act is of significance. A bare reading of the provisions makes it clear that the legislative intent was to prohibit goods vehicle from carrying any passenger. This is clear from the expression "in addition to passengers" as contained in definition of "good vehicle" in the old Act. The position Page 6 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined becomes further clear because the expression used is "good carriage" is solely for the carriage of goods. Carrying of passengers in a goods carriage is not contemplated in the Act. There is no provision similar to Clause (ii) of the proviso appended to Section 95 of the old Act prescribing requirement of insurance policy. Even Section 147 of the Act mandates compulsory coverage against death of or bodily injury to any passenger of "public service vehicle".
The proviso makes it further clear that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in goods vehicle would be limited to liability under the Workmen's Compensation Act, 1923 (in short 'WC Act"). There is no reference to any passenger in "goods carriage".
14. The inevitable conclusion, therefore, is that provisions of the Act do not enjoin any statutory liability on the owner of a vehicle to get his vehicle insured for any passenger travelling in a goods carriage and the insurer would have no liability therefor."
10. In the case of New India Assurance Company Ltd. v/s. Asha Rani [(2003) 2 SCC 223), after referring various definitions involving legal question, it was held as under :-
"23. The applicability of the decision of this Court in Mallawwa v. Oriental Insurance Co. Ltd. in this case must be considered keeping that aspect in view. Section 2(35) of the 1988 Act does not include passengers in goods carriage whereas Section 2(25) of the 1939 Act did as even passengers could be carried in a goods vehicle. The difference in the definitions of goods vehicleµ in the 1939 Act and goods carriageµ in the 1988 Act is significant. By reason of the change in the definitions of the terminology, the legislature intended that a goods vehicle could not carry any passenger, as the words in addition to passengersµ occurring in the definition of goods vehicle in the 1939 Act were omitted. Furthermore, it categorically states that goods carriageµ would mean a motor vehicle constructed or adapted for use solely for the carriage of Page 7 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined goodsµ. Carrying of passengers in a goods carriageµ, thus, is not contemplated under the 1988 Act.
24. We have further noticed that Section 147 of the 1988 Act prescribing the requirements of an insurance policy does not contain a provision similar to clause ( ii ) of the proviso appended to Section 95 of the 1939 Act. The decision of this Court in Mallawwa case must be held to have been rendered having regard to the aforementioned provisions.
25. Section 147 of the 1988 Act, inter alia, prescribes compulsory coverage against the death of or bodily injury to any passenger of public service vehicleµ. Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle would be limited to the liability under the Workmens Compensation Act. It does not speak of any passenger in a goods carriage.
26. In view of the changes in the relevant provisions in the 1988 Act vis-a-vis the 1939 Act, we are of the opinion that the meaning of the words any personµ must also be attributed having regard to the context in which they have been used i.e. a third partyµ. Keeping in view the provisions of the 1988 Act, we are of the opinion that as the provisions thereof do not enjoin any statutory liability on the owner of a vehicle to get his vehicle insured for any passenger travelling in a goods vehicle, the insurers would not be liable therefor.
27. Furthermore, sub-clause (i) of clause (b) of sub-section (1) of Section 147 speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place, whereas sub-clause (ii) thereof deals with liability which may be incurred by the owner of a vehicle against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place.
28. An owner of a passenger-carrying vehicle must pay premium for covering the risks of the passengers. If a liability other than the limited liability provided for under Page 8 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined the Act is to be enhanced under an insurance policy, additional premium is required to be paid. But if the ratio of this Courts decision in New India Assurance Co. v.
Satpal Singh is taken to its logical conclusion, although for such passengers, the owner of a goods carriage need not take out an insurance policy, they would be deemed to have been covered under the policy wherefor even no premium is required to be paid.µ"
11. Effect of 1994 amendment in regard to gratuitous passenger was again examined in National Insurance Company Ltd. v/s. Baljit Kaur [(2004) 2 SCC 1]. The Apex Court following the judgment in the case of Asha Rani (supra) found that words "injury to any person" would only mean third party and not a passenger travelling in goods carriage. The question came up for consideration again in the case of National Insurance Co. Ltd. v/ s. Bommithi Subbhayamma [(2005) 12 SCC 243], whereby said view is reiterated.
12. Coming back to the case on hand, it is undisputed that deceased Ghanshaymbhai was travelling in the Utility Van, which was goods carriage vehicle. As per evidence of claimant, he was travelling as passenger in the goods carriage vehicle (see :
Exh.19). The goods carriage vehicle was driven by driver at excessive speed and since he could not control steering, Utility Van turned turtle resulting into injury to deceased - Ghyanshaymbhai and instantaneous death being result of injury. Policy leaf on record at Mark 34/1 indicates that policy was issued for goods carrying commercial vehicle. Limitation clause in the said policy reads as under :-
"Use only for carriage of goods within the meaning of Motor Page 9 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined Vehicles Act. The policy does not cover (a) organized racing, pace making, reliability trials or speed testing (b) drawing a trailer except the following (c) carrying passengers in vehicles except employees not exceeding the number permitted in registration document and coming under the purview of WC Act, 1923."
13. Column showing premium taken in leaf of policy does not indicate that premium is taken to cover risk of travelers. It only covers legal liability of employee / driver. It was argued on behalf of the claimants that Insurance Company has charged Rs.294 to cover risk liability. Said submission is premised upon finding arrived at by the learned Tribunal in following words :-
"Further, it is also on record that the opponent no.3 - Insurance Co. has not examined any competent officer of it's insurance company and further they have also not produced any insurance permit. Further, it appears from the insurance policy produced vide Exh.35 that amount of Rs.294/- towards extra premium charged by the insurance company for any extra liability."
14. Close look at the leaf of the policy indicates that premium of Rs.294 was charged for any extra loading that means Insurance Company has taken risk of extra loading of goods carriage. Learned Tribunal has read said words as extra liability. It is clear error on the part of the learned Tribunal. What appears from the facts of the case that deceased met with unfortunate accident and lost his life while travelling in capacity of unauthorized passenger in Utility Van being goods carriage vehicle. Since, Insurance Company has not charged any premium for such passenger, Insurance Company cannot be held liable to pay compensation. Limitation clause in the leaf of the policy spells that risk of passenger is not covered.
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15. Learned advocate Mr. Modi for the original claimants submitted that Insurance Company cannot take defence of not covering risk of passenger in absence of oral evidence explaining contents of leaf of the policy. This submission does not inspire confidence. On plain reading of leaf of the policy, which is relied even by the original claimants, it appears that risk of the passengers travelling in Utility Van was not covered. Undisputed fact is that Utility Van was goods carriage vehicle.
16. Reasons spells hereinabove indicate that learned Tribunal seriously erred in fastening liability upon Insurance Company inspite of the fact that deceased was travelling as gratuitous passenger in Utility Van. Error of understanding of provision of law is crept. The Appeal thus merits and requires to be allowed.
17. So far as judgment relied by learned advocate Mr. Modi in the case of Manuara Khatun (supra) is concerned, it was fact that deceased was travelling in jeep, which was private vehicle. It was case where defence of hire or reward was prayed and in that background, Insurance Company contended that victim was gratuitous passenger. The Apex Court on this facts while exonerating Insurance Company passed order of "pay and recover". The facts are different from the present case. In case of United India Insurance Co. v/s. Janubhai Radvabhai Vasava (supra), perusal of the judgment, as per that the facts of the case is missing. What comes from the judgment is that this Court has reiterated the principle of "pay and recovery". Little fact disclosed that deceased was travelling in offending vehicle as labourer and that fact has prompted this Court to pass order of pay and Page 11 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023 NEUTRAL CITATION C/FA/973/2015 JUDGMENT DATED: 09/08/2023 undefined recovery. Facts of the case is different from facts of the present case.
18. For the foregoing reasons, the appeal succeeds. The impugned judgment and award as far as fastening liability of Insurance Company is concerned, it is quashed and set aside. However, the impugned judgment and awards suspects against driver and owner of the offending vehicle.
19. In Civil Application No.5829 of 2015 filed in the present Appeal, this Court has passed the order for depositing 100% of the awarded amount, out of which, 20% is ordered to be disbursed to the claimants and 80% of the amount was ordered to be invested in the long term FD in any Nationalized Bank in the name of claimants. Further vide order dated 19.04.2018 in Civil Application No.1 of 2018 the Court has permitted to withdraw the interest from the FD.
20. Learned advocate Mr. Rathin Raval fairly submits that Insurance Company does not claim refund of the amount which is already disbursed in favour of the claimants as well as the interest which is permitted to be withdrawn. In view of this fair submission, the amount of 20% of the awarded amount with accrued interest thereon and other interest, if any, paid to the original claimants shall not be recovered. The Tribunal is directed to pay back the balance 80% of the amount which is deposited in the Nationalized Bank to the Insurance Company either through RTGS or NEFT after due verification.
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21. It is made clear that the original claimants are at liberty to recover 80% amount of the judgment and award with interest at the rate of 9% from the date of petition till realization (If the interest is not received from the amount fixed deposited) as awarded by the learned Tribunal from the owner and driver of the Utility Van. No costs. Record and Proceedings be remitted to the concerned Tribunal forthwith.
(J. C. DOSHI,J) SATISH Page 13 of 13 Downloaded on : Sun Sep 17 00:47:59 IST 2023