Karnataka High Court
The Manager, Reliance Gen.Ins.Co.Ltd vs Sri. Shekappa S/O. Mariyappa Yeligar on 13 July, 2011
Author: N.Kumar
Bench: N.Kumar
N Thi HEGH COURT or KARNAT AKS CiRCULT BENCILAT (3 HL AR WALD © DATED THIS THE 13° DAY OF JOLY, BEPORE THE HON'BLE MR. JUSTICE:N. KUMAR. MELA. Now, 237 a 20410 A wo Mise. Cvl. No. 0086220 bb 4M vi Nol 981 2/21 O10, CEW M.FLA. No. 2380 2010. Abs Mise: Cal. No} 18/2010. MFA. No. 24916) 2 Alw Miss. Cv. No.1 10 e160) 10 M.F.A. No. O32 b/ 2 TL re ak we vi. No. L008S52/2011 & Mise, Or sist 853/201) IN M.F.A, No.23 718/201 Ary Misc, Cvt. No. M8? pat | Lane : M ise. Cvl. No. LO8162/2016 Between: VReM anager, Reliance Gen. ins. Co. Ltd. Kalburei Sgares Desai Cross, Deshapa ade Magar. Hubli, eoRep. by its De spity Manager Legal Claims. 728. 5° Floor, Sohenary Bu Hiding. Bangalore-O1, (Common in Appeal & Mise ci vis) (Es Sis Nevarar C Rolloors Advocate} ood, shekappa S'o Marivappa Yeligar. Age: 60 vears. Occ: Agriculture Respondent NO. & 2 are R/o. Parasapur, Vittal Séo, Shese pps VYaligar, Age: 25 vears, Oce: Cool tq: Shirl ahatti. Dist: Gadag. Now Réat: Hitnal. Tq: & Dist: Koppal. 3, Stikanth S'o Yallappa Eligar. ag eae Age: 25 vears. Occ: Driver. Rio. - farasapur. Taq: Shirahatti: Dist: Gadag. : Hanumantappa S/o, Pakeerappa Kligar. a Age: 335 years. Oce: Agriculture. Rea, Parasapur Ta: Shirl alatth Dist: Gadage ne IPP CO-FOKIO G. be td: No. i 27-A, Bhavani. vreade 3h Soon 304, 308 308s, Near eld bus stand © ie Basavavana New Co bon Market. Hubli-s&e. 029. Arun Shinde Svt.., Nuras! ga Rao. Age: 38 years, Oe: Driver. Reo. a Noga) / Maruti Circle. "CrossioNekar Nagar. Ord Tavbu- " Malathesh Sic, } Hanumantha Rao Kulkarni. Major. Qee: Business. RY Mar itt Cirete, Dewaic i Crass, Nekar Nagar. Old Hubli. (Common in ADI my He Respondents ai d& Mise. Cyi's) i ~ Respondent No} & 2 are Rio. Parasapur, This M.F.A. as filed under Seetian 173i1) of MLV Act. aenifist the judgment and award dated 02/062010 passed in MVC No 46722099° on the file of the Member, Additional MACT and Presiding Officer, "last Track Court-l, Koppal. awarding the compensation of Rs. 2.89000. along ° with interest at the rate of 8% PLA form the date of petition ur denasit. -- Misc, Cvl No. 1O0862/2011 is filed under Section FS)oof C.P.c praving, For dispensation. OO Mise. Cvi No. 1081622010 is Hleduinder ¢ Ider XLT Rule 3 Read" With Section PS] of CPC praving for Say. : on : IN M.F.A. No. 23694/2010 Alw. Mise.Cvt No. 108118/2010 -- Between: lhe Manager, Le -- Reliance Gen. Ins, Co. Lote. a Kalburgi Sqare. Desare OSS." Deshapande Nagar Hublis Rep. by its Deputy Manager . legal Claims: #28. 8"! Ptoors. Centenary Building. Bangalore-01. . es - Appellant (Common in Appeal & Mise.Cs i: (Be Sriv Napaftay molloort Advocate) 1 Jagadish S'o Hanumantappa., Age: 28 wears, Oce: Agriculture. Wo lagadish. AgeD 22 years. Oce: Hausehold, Poo Shirt ahatti. Dist: Gadag. a Now Rat: Kamarasagar. Tg. & Dist: Koppal. 3 Srikanth S'o Yallappa Eligar. Age: 25 years. Occ: Driver, Reo. Parasapur Uq: Shirahatti, Dist: Gadag. oe 4. Hanumantappa S/o. bakeerappa Fligar, Age: 3S years, Oce: Agriculture. Ro. Parasapur. Ty: Shirl ahatti, Dist: Gadag. ) 5, IFFCO-TOKIO GLE bide No.l27 A. Bhay va ni i Arcade e Floor, 306, 30 O08. Near old bus stay ad h Opp. : Basavavana New, Catton, rket, Hubli-S&0 029. : 6. Arun: Shinds 7 O Narasinga Ree, Age: 28 years, Oee: » Driver. Rio. HONo 347. Maruti ciFele I' Cress. Nekar Nagar. - Old. Paebli, : Matathesh' S/o. Hanum vaiitly a Rao Kulkarni, AS Major. 'Gee: Business. RYO: Maruti Circle. Denard Cress, Nekar Nagar. Gid Hubli . - Respondents (Common in Appeal & Mise. Cvl) ; shis MLPA. is filed under Section 173¢i) of the MV | cl. against the judgment and award dated 02.06.2010. passed in MVC No. 4606/2009. a + the file of the Member. Addl. MACT and Presiding Officer. Past Track a ~ Court-l Koppal. aw arding the compensation of Rs. 1.S2.0G0/- with interest at the rate of 8% per annum from the date of petition HE deposit. i- Mise. Cvl No, LO8118 2010 is Aled under Order XL} Rule. > Read With Section PSL of C.P.C praying for stay. , IN-MLELA. No. 2491 6/2010 Alw. -- Mise. Cvl. No.1 0816/2610 Between: United India Insurance Company Limited, Divisional Office. LIA Co mp Mew. Opp: HDMC Dharwad. - Now at Ankola Complew. Near Jublee Circle. Dharwad. Rep. by its Divisional Manager, - Appellant mio Om GN yn Appeal & Mise. Cvl} (By Sri NOR Ku upp elute Advovate)~ |. Mahabood,Sab Sioa" Moulasab Ramapur, | -- Age: 34 years. Ooo. Nil, ~ Rio. Saidapur. Dharwad. "Age: Mator. 58. Rfo. Medur. dist: Havert. -- fOwnerof the Lorry " bearive No. KA-27/A-0386) - Respondenis . (Common in Appeal & Mise. Cv) . hes MUPLA. is filed under section P7301) oF MLV Act. 1988. against the judgment and award dated 30.07.2010. passed in M.V.C No,747/2009, . oft the Hie of the Presi idis ra Olcer. Fast Track (11, Dharwad. awarding the compensati on of Rs. 1.00, ).020/- with interest at the rate of 6% P_A from the date of petition til the date of deposit. Mise. Cvl, No, | 1O81622010 is fled under Order X11 Rule: S of the CPC praying lor stay. mS IN MLUELAL No, 2032 1/201 LAW, oe Mise. Cvl. No. "a 852-2011 and Mise, Cvl. No. | OQ853/201 | Between: The piisional Manager. ce vw India Assurance Company Limited. a Al cade . Complen. DS i Hospital Road. 2 avanagere. ep through its Regional Offic 2" Floor. Srikant Complex. | New Cotton Market. _ Hubli, Rep. by tts Re egional Mat nage Yr, . . : - Appellant . Somimon in Appeal & Mise.Cvl's) (By Sein NLR Kup pelur. Nd v eave) Ang: a. Smt. Taramavva Wo Late inalleshappa Katenahally, ~ AoE: Fy earsoOce: House hold work, 2. Sit. Mallavva W/o Fekivappa Ramadammanave ee: 34 years, Oce: House hold wor Raul os "Shiv Hanamantappa S/o. ate Malleshappa Katenahalli. Age: 28 vears, Occ: Coolie. as Sri. Ramesh S/o. Late Malleshappa Katenahalli. Age: 26 years, Occ: Coalie. " nome "ee All are R/o. Motebennur. Tq: Byadagt. Dist: Haveri, Now Réat: Shivaji Nagar 2"" Cross, Haveri. >. Srivdtrappa S/o. -- Channabasappa Hittalamani, Age: Major. Oce: Business. Rio. Motebennur, Pq: Byadagi. Dist: Haveri. me . Responde nts ; (Comment i »Appeat & Mise. Cvl's This M.FLA. is filed under SeCHE n 173¢ I p of MV Act, 1988. against the judgment and award dated 24/05 2010 . passed 1 MVC.No.218/2007, on the Hle of the Pris Senior Civit. Ja idge and ember Addl. MACY, Haverl, awarding the: comipensation OF Rs. 4.56:052/- with interest af the rate of 6% PLA from the-date el petiion tt) realization. Mise. Cs LNo.LO QUES2/201 1 AS flee. ander Section 3 of the Limitation Act pray nie sto condone. del: ay of [01 davs filing the appeal. Mise, C VL No. FOORS320N i filed under Order XL Rule 5 of the C.PC praving for stay. ONG These appeals along with Mise. Cvl. applications coming can Par orders non-compliance of office objections: hearing on [ACS Admiss stonfinal hearing. this dav. Court delivered the following? wee . i if 2 4 . ° " "eee gach bear ai sy gs 4 ee fr N ee hee Ts AT these appeals are preferred by the Insurance € OMmpany Chainerewie the award of the Tribunal where noOl-wilnstanding fhe violation of the terms of the policy. Habilily is foisted on ~ the insurance company to pay compensation to the third party sladamsamde he Sachi PYbekriis , ty. 2. l.earned Advocates appearing for the insurance company contended that tf is not in dispute that the vehicloinvolved sn. the accident is covered under a valid insurance polies Gn the in question was not driven by a peison who had a valid. driving licence. Therefore it was contended that theré-is violation oF the terms of the insurance policy a celence which is available to them under Section 149 of the Motor Vehicles Act. 198k (for short hereinafter referred £0, as AER). "When ance there is violation of the terns olthe insurance policy. the insurance COMI pPaAs is absolved of al fis Habiligy lo pay the award amount to the third parties, Beeainse when the insured has committed reach vol the ternrs. ol the imsurance policy there is no onligation on-their part to indemnify the insured. : as fy beget oy Gog ig ca fe outs cere bag wee PED gay teeter tnd BUN se + liesuppertol the above contention learned counsel for the ppellant relied upon @ recent judgement of the Anex Court in f the Sense OF National fasurance Compane Limited Kes. Vadmneni Ghd anofner reported in ¢2009) 8 Supreme Court Cases 7835. wherein it is held at paragraph ne. S and 6 as under: é Oo. 3. /f the insurance company has no iiability ta puyat ali, dnen, in our opinier. if can not be compesled bi order of the Court in exercise of ifs jurisdiction pay the compensation amount and later on recover Fh fran the ~ Ader Articie 7/42 of the Constitution of india fur ¢ owner of the vefi¢le. In aur view, Article [42 of the" Constitution of India does nel cover such tipe of COUSES, 6. When a person has wo liahthity to pavart all how can Hobe compelled fo pave [omeav take years for the fasurance company (0 recover the amount from the owner of the vehicle and it is elisa possible that for some reason the recovery mary-nor he possible at all. ~ Before observing asoaforesaid. they directed their Lordships directed all the papers of the case be placed before the Hon'ble Chief Justice of india 'for.constituting larger Bench 10 decide the following questions» whreh reads as under: bf an insurance company can prove that it does or fave auy liability to pay any amount in law to the lalatanis under the Moror Vehicles Act or any othe: CPDL EP IN Can fhe court yet compel it to pay the . '. cae nr " bot . . oan - Pld. . 7 ye CTO iif SGueSHIOR siving ff iiperty fo OH SaaALC FROM File Gwiter of the vel: CORSHIFULION, a Whe? £8 i scope fiOe8 Arties Pete tafe Ai Wie! From the facts set out in the aforesaid judement il ts clear there was no valid insurance coverage to the vehicle invelved in the accident, on date of the accident, Therefore there "is no lability on the part of the insurance company. either fo indemnify the insured or te pay any compensation to the third party under the provisions of the Act. lis in 'that context it was observed in the aforesaid judgement that when. there. js Ag. . £ valid insurance policy. when there is nO obligation either under the contract or under the "statute. 'inerely. because the Apex Court by virtue of the power con Porred indet Article 142 of the Constitution can "direct a they insurane an : company to pay compensation io the, third party -claiman and reeover it from the owner. AS of now the Said matter is referred to the Larger Bench of the. Apex Court we feve to await the decision af the Apex Cover, Bo Howes or Lat "ES not the question involved in these eppeals.. in ill these appeals there is a valid insurance policy "eovering the, risk of the vehicle involved inthe accident. The . gvigvance: is the insured has violated the terms of the policy, sec, $49¢2) of the Act expressly provides when th "made a party to the claim petition. on what grounds he can defend the action. One such ground which is available t Li is: a condition excluding the driver by a named persan of persons or by any person who is not only licensedsor bys any person who has been disqualified for holding or obtaining a, driving licence during the period of disqualification: If that defence is established then the liabilit\ of rhe insurance: compans to indemnify the insured stands: discharged. Therefore it was contended that under the. scheme "of the Act the insurance company pays the awerd 'amount because of the contractua | obligation un dey ce contract between ine insured and the insurer and onee: the contiact 1s breached. such a liability does not ex isi, Lat Though these argumerits look very attractive. on a careful serufiny sof the relesant provisions of the Act. the said irgumerd runs coumter to the object of Chapter |i of the Act. Chapter 11 ofthe' Act deals with insurance of motor vehicles ~. against third party risks. Sec. 146 of the Act deals with "necessity for insurance against third party risks. Ht provides ~ that no person shall use. except as a passenger. Of Cause or albow any other person to use. a motor vehicle in a public place. unless there is no force in relation to the use of the ut ". under: i I vehicle by that person or that person. as the case maybe. a policy of insurance complving with the requirements. of. this Chapter, Therefore the object of the aforesaid. prawistoas is to. protect interest of third parties who would be-the victims of a motor vehicle accident. By virtue of the said prevesion today a new vehicle cannot come on the road without.a valid.insuranee policy being obtained by the. insured froma person who fs an authorised insurer, Once such an insurance policy is issued by a person, who is autherised to insure under Section 147 of the Act Statutorily prevides 'the coverage of that insurance policy to the third parties.as mentioned therein. The proviso to See. Tsons who do nor fall within the lh? also covers the risk oof category «Gf third parties. but only to the extent as mentioned under the provisions of the Workmen's Compensation Act, i963, Pn se Par esthe damage to any property by third party is concerned. the leit is restricted to only € 6.000/-. See, 149 of is a-provision which makes it obiigatery for the insurer tO.sdlisre' the judgements and awards against persons insured in respect of third party risks. Sub-Section | of Sec. 149 reads as id z wot ben fof At "(Li dt after a certificate of insurance has been issued under sub-section (3) of section 147 in fuvoier' of the person by whom a policy has heen effected... judgement or award in respect of any such Hii Listy' aS is required ta be covered by a policy under chause fh} of sub-section (1) af section (4% ¢heine a iahil: ie covered by the terms of the policy) for under the . provisions of Section 1634) is chtained REVISE, any. person insured by the polfey, then, notwithstanding that the insurer may be ei ithe nd 10 avold.or a may have avoided or cance elle id shall, subject to the provisinsws the person entitled to ite fipe policy. tite iPRSUPeF Of Hus section pay to "the decree any Suin Hot exceeding ~ Lire > aun "assured pavable thereunder, as if he were the. judemear debtor, in respect of the diahilliv, iogether with any amount pavable in respect OF; COSTS and enyeSum payable in respect of. fnterest Ol Phar sum Dy virtue of any CR CAOCEIIEG Fri POLGTNG pea inte me sf OI: judgime ALS. 6, The atoresaid provisions. contai ned the non ohbstante clause. be... nobwithstanding- that the insurer may be entitled to aeoid orvcancel or may bave avoided or cancelled the poliey. L i the imsurel shall. subject lo the provisions of this section. pay to the person entiiled to the benefit of the decree any sum not ~ exceeding-the sum assured payable thereunder. as if he were "the pudetent Gebtor. in re "any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment l- clating to interest on judements. award is passed. The insurance Company steps into the s} 7. Sub Section (2) provides that if the insurer isto be proceeded against For recovery of the amount due under the award. then he should be made 4 party to the said-praceedinys. if he is not made a party to the preeeedings: motwithatanding the vehicle involved in the wecident is insured, insurance company ts not lable to pay the third parts. stepping Into the shoes of the insured as tee judgement. debtor. Further sub Section (2) also provides once the ingurer is.mlade a party to the said proceedings che-has all right to defend the action and the grounds on which he cCould-defemd thé action. are expressly provided therein. tn other words. he cannot defend an action On any ground other than whats preseribed under the statute. a. A harmonious reading of these two provisions makes it clear. "ance there-is a valid insurance policy issued by an imsurer who is Authorised to insure the vehicle covering the risk OF a third party. See. 147 as well as Sec, 149 of the Act is ". preceeding claiming compensation the requirement of sub oo. Section (2) of Section 149 is also complied with. Then the =
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ofa judgement debtor. i.e.. the insurer and statutorily a liability is Cast on the insurance company to satisfy the aware passed by a Tribunal. Therefore the obligation ef the insurance company, lo satisiy the award in so far as the thi rd party.is concerned is absolute and it is a statutory liability. Ui canner be avoided:
under any ¢ircumstances. But when a right to defend such an action is conferred on the, insurer, ot the-grounds mentioned therein. if Ure insurance company substantiates its defences, the consequences would-be under the terms of the policy. the insurer is not habie <o indempify the insured. The insurer ean avoid the contract. Ashe-has made to pay the amount covered 'Sec. 147 row Sec. 14961) of the under the aw ard by virtie & Act. (he aneurer get a tight: to recover the money paid from the , insured. For that purpose. iL is mot necessary for them to nitiateany" proceedings independently. Under the very award which trey nave satisfied. a direction could be given by the recover the amount from the insured. Ther contention of the imsuranee company that onee the insurer establishes the breach of the ferms of the insurance poliey, "there is no obligation on their part to satisiy the award in so far Ine third party also is concerned, is without any substance. in i : ed that connection it is useful to refer to a recent judgement of the Apex Court in the case of Oriental! dnsuranece. Coo. Vs, Ldhearuinistiea & Ors. Reported in A/R 20U8 SUPRE ME COUR fr . (xii Where on adjudication 6f the éla 1719 wie ap the tribunal arrives at a convlusion ie the insurer has satisfactorily proved its defence in accordance with fhe pravisions of Section J E9623 read with Sub section €7)}. as interpreied bycthis Court dhove. the Pribune! can direc! thett the faserer is frahle ta be reimbursed Oyv-the-insared for ihe compensation and other amounts witch it has heen compelled to pay fe fhe third. parteaurider theaward of the tribunal. Such determination ~of-
Dy the Trihfunal will pe enforceable and the money found due te the insurer APO Punsured Will be recoverable on @ certificate fseued pe-ihe irihunal to the ecallecior in the same PH ELPRITO Td 'ff ef the Aci as arrears of land PHO COPE Cale wilh Pe issued for the as arrears of fand revenue only if. as reguired by § fon £68 of fo deposit fhe amount award the fasured fa . . i hoes fayatypee yn tigi, lan by lye eae Peper fee tise eho erns VOUF OF THE Tistrer within thirty davs from the date OE EEY ' of announcement! of the award by the tribunal. i ixij fhe provisions contained in Sub-seetiaon (4) with proviso thereunder and Sub-section (3) which Aare intended fo cover SPecipled COMMENCES 'inentioned © therein fo enable the insurer to Fecover umount paid, under fhe contract of insurance om behalf of the fsured can be taken recourse of by the Trihter be extended to claims and défenees of insurer. "eulas) insured by, relegating them tothe remedy (before, regular court in €ases where en given fucis and cleeumstances adjudication of their >claints inter sé might delay the adludicutionoaf the elaims of the VECTIAES, PS. oda the light of the above-settled proposition of fw. Phe appeleanf-lrisuvance company cannot he held Mabie fe pay fhe apteunt of cempensation to the clatmanis fer the €ause of death of Shukurullah in rodgd eccident whick fed occurred due fo rash and egifgent>.driving of scooter by Ram Surat who Vaiid cd effective bf€¢é 14? GR ive . ae Of ageerdent.
driving Heence of driving HMV ana : : : , Foe doy td cpa ee af Qos ad boys "hed af thris AATF fils is in vielation ef Section (O62) of the MF Aer. iM, AEA POSH PAG appedi is aiiewed fo the fisiiled extent and if is directed that the appellant-insurance COPD ch FPS hough Gh fiORle Fo pas the GIiNOQUNH! of Sg, H compensation, but in the nature of this case it sfrall satisfy the award and shall have the right ta i wi COVER.
fhe amount deposited by it along with inféresh from the *. fa view of the faci that nea appeal was preferred by him nor hes he chosen to appear hefere this Court, te o2 - fo ¢dade Prt. --_ an oa Sse qa paste Bye beg contest this appeal. This direetion fs. givem-in-the light of the judgments of Gris Court. in National Insurance Company Limited Fos "Baljit Kaur aid Others [ff 2004) £ SCO und Deddauppa and Orhers Vis. Brnaech Manager, National Insurance. Cemipany Limited ((2008) 2 SCC S0Sf, uF, In that view of the ntatter. in all these appeals as the liability is foisted on the isurance company with a liberty to the insurance company to recover the amount paid frem the of 'insured "I do not see any justification to interfere with these awards... Accordingly all these appeals are dismissed. ia vaew of dismissal of the appeals on merits. pending 108 16/2010. Mise. Cvl. No. ld08S52/201) and Mise. Cvl. No.
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lOO8S3/201 1. do not survive for consideration and accordingly they are dismissed.
Il. Amount deposited by the Insurance Company at the time OF preferring these appeals be transnvitted 'to the Tribuaal fer beime paid to the claimants. forthwith. Ba _ - . Sd/-
»~ JUDGE