Gujarat High Court
Oriental Insurance Company Ltd vs Legal Heirs Of Decd. Rameshchandra ... on 28 November, 2024
Author: Biren Vaishnav
Bench: Biren Vaishnav
NEUTRAL CITATION
C/FA/3408/2012 JUDGMENT DATED: 28/11/2024
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 3408 of 2012
With
CIVIL APPLICATION (FOR ORDERS) NO. 3 of 2012
In R/FIRST APPEAL NO. 3408 of 2012
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BIREN VAISHNAV Sd/-
and
HONOURABLE MR. JUSTICE MAULIK J.SHELAT Sd/-
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Approved for Reporting Yes No
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ORIENTAL INSURANCE COMPANY LTD
Versus
LEGAL HEIRS OF DECD. RAMESHCHANDRA BHAILALBHAI JOSHI &
ORS.
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Appearance:
MS KARUNA V RAHEVAR(3818) for the Appellant(s) No. 1
MR CHHAYA, ASST GOVERNMENT PLEADER for the Defendant(s) No. 8
NISHIT A BHALODI(9597) for the Defendant(s) No. 1,2,3,4,5,6
RULE SERVED for the Defendant(s) No. 10,9
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CORAM:HONOURABLE MR. JUSTICE BIREN VAISHNAV
and
HONOURABLE MR. JUSTICE MAULIK J.SHELAT
Date : 28/11/2024
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE MAULIK J.SHELAT)
1. The present appeal is filed under section 173 of Motor Vehicle Act, 1988 (herein after referred as MV Act) by the Page 1 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined insurance company against the judgement and award dated 16.06.2012 passed by the Motor Accident Claims Tribunal (Auxiliary-I) (hereinafter referred to as 'the tribunal'), Gandhinagar in Motor Accident Claim Petition (MACP) No. 173 of 2007 holding insurance company liable to pay compensation to the claimants. Parties are referred to as per their original position.
2. Short facts of the case:
2.1 The claimants are widow and children of deceased Rameshchandra, who was travelling in Toyota Qualis car bearing registration number GJ 1 8G 1440 for office work on 13.05.2005, who met with an accident having collided with one truck bearing registration number GJ 12 W 9988, due to which Rameshchandra had sustained serious injuries and succumbed to such injuries. Because of the death of Rameshchandra, his legal heirs have preferred MACP under Section 166 of the MV Act claiming compensation of Rs.30,00,000/- with costs and interest at the rate of 18% per Page 2 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined annum from driver, owner and insurance company of car as well as driver and owner of truck as it appears that truck was not insured vehicle. Except opponent No.3- insurance company, other opponents have chosen not to appear and filed their written statement. Opponent No.3 has filed written statement at Exhibit 16, denying its liability to pay compensation. The tribunal has framed issues at Exhibit 24 and after appreciating evidence on record, found driver of Toyota Qualis car negligent to the extent of 80% and driver of truck was found 20% negligent.
2.2 The tribunal has examined documentary and oral evidence led by the claimants and awarded total compensation of Rs.15,50,900/- which carry 9% interest from the date of claim petition, till the date of its realization. So, in view of the aforesaid award passed by the tribunal, the appellant-
insurance company was held liable to pay compensation jointly and severally with other opponents.
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3. Submissions of the appellant:
3.1 Learned advocate Ms. Karuna Rahevar appearing for the appellant - insurance company would submit that the appellant has challenged the impugned judgement and award by way of present appeal, which is confined only to the aspect of liability of insurance company to pay compensation. She would submit that insurance company of Toyota Qualis Car had issued Liability Only Policy (Act Policy), which was produced at Exhibit 48, wherein statutory risk of occupant travelling in the vehicle was not covered.
3.2 She would further submit that deceased was employee of owner of the car i.e. opponent No. 2 - Director of Developing Caste Welfare and he was travelling during the course of his employment attending office work. She would further rely upon proviso of Section 147(1) of the MV Act. Thereby, submitted that risk of employee travelling in the vehicle owned by employer would not be covered under the policy issued by the insurance company. She would further submit that no Page 4 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined additional premium was paid by opponent No. 2 - owner of the car covering the risk of its employee, then in that case, insurance company cannot be held liable to pay compensation.
3.3 She would further submit that despite drawing attention of the tribunal about the insurance policy and the decision of Honorable the Supreme Court and this Court regarding issue germane in this matter, the tribunal has wrongly held insurance company liable to pay compensation.
3.4 She would lastly submit that additional premium of Rs.250/- paid by opponent No. 2 covers personal accident of occupants travelling in car, which is of a fixed amount of Rs.50,000/- for each occupant, as sitting capacity of Toyota Qualis Car is 10 person.
3.5 She has requested this Court to consider the request of insurance company, whereby it may be permitted to place on record copy of terms and conditions of liability only policy being liability Only Policy issued by the insurance company Page 5 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined and thereby, allow the Civil Application for additional evidence. According to her, such terms and conditions of policy in question is required to be taken on record for effective adjudication of the appeal.
3.6 To buttress her arguments, she has placed reliance on the following decisions of Honorable the Supreme Court and this Court:
(1) National Insurance Company Ltd v. Balakrishnan and Anr reported in AIR 2013 SC 473 (2) Oriental Insurance Co. Limited vs Sudhakaran KV reported in 2008 (7) SCC 428 (3) United India Insurance Co. Ltd. vs. Bakulkumar Prabhudas Patel in First Appeal No. 3735 of 2009 (4) United India Insurance Co. Ltd. vs. Ramdevbhai Dahyabhai Mokaria in First Appeal No. 505 of 2015 (5) The United India Insurance Company Ltd. vs. Nileshkumar Mohanbhai Parmar in First Appeal No. 2104 of 2018 3.7 So, learned advocate for the appellant would request this Court to allow appeal by exonerating the insurance company from paying the compensation.Page 6 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024
NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined
4. Submissions of claimants and respondent No. 8 4.1 Per Contra, learned advocate Mr. Nishith Bhalodi appearing for the original claimants would submit that the insurance company would fail to prove before the tribunal by leading appropriate evidence that policy which was issued by the insurance company did not cover statutory risk of occupant of the car.
4.2 He would submit that it is a case of composite negligent and claimants can recover the compensation from any of the tortfeasors.
4.3 He would further submit that when the insurance company has charged extra premium covering the risk of the occupants of the car, it could not escape from paying compensation, at least Personal Accident Cover i.e. Rs.
50,000/-.
4.4 He would submit that, in any case, the insurance Page 7 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined company cannot be permitted to bring new evidence before this Court in appeal by way of an additional evidence, because ample opportunity was available to the insurance company to submit terms and conditions of the policy before the tribunal, which was in its possession since inception.
4.5 According to his submission, considering the provisions of Order 41 Rule 27 of the Code of Civil Procedure, application filed by insurance company requires to be rejected. which reads as under:
"27. Production of additional evidence in Appellate Court.-
(1) The parties to an appeal shall not be entitled to produce additional evidence, whether oral or documentary, in the appellate Court. But if -
(a) the Court from whose decree the appeal is preferred has refused to admit evidence which ought to have been admitted, or [(aa) the party seeking to produce additional evidence, establishes that notwithstanding the exercise of due diligence, such evidence was not within his knowledge or could not, after the exercise of due diligence, be produced by him at the time when the decree appealed against was passed, or]
(b) the Appellate Court requires any document to be produced or any witness to be examined to enable it to pronounce judgment, or for any other substantial cause, the Appellate Court may allow such evidence or document to be produced, or witness to be examined. (2) Wherever additional evidence is allowed to be produced Page 8 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined by an Appellate court, the Court shall record the reason for its admission."
4.6 Lastly, he would submit that considering the position of law as on date, if this Court ultimately comes to the conclusion that insurance company is not liable to pay compensation, then insurance company may be directed to pay an amount of Rs.50,000/- for Personal Accident Cover to the claimants.
4.7 Learned AGP Mr Chhaya appearing for opponent No.2 -
owner of the Toyota Qualis Car would submit that, it is true that opponent No.2 had not appeared and filed its written statement before the tribunal but having served with the notice of present appeal, opponent No. 2 has filed a detailed reply opposing the appeal and also pointed out several details about payment made by opponent no.2 to the claimants on death of Rameshchandra. The details of such payment being stated and reflected at para 7 of reply are as under:
Page 9 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined No. Details Paid amount 1 Government insurance Rs.2,00,000/-
2 Immediate Death Allowance Rs.25,000/- 3 G.P.F. Rs.3,70,241/-
4 Link Insurance Rs.60,000/-
5 Leave Encashment Rs.43,998/-
6 Gratuity Rs.3,50,000/-
Total RS.10,49,239/-
4.8 He would further submit that when car was insured with
the insurance company, then it cannot be gainsaid that risk of occupant travelling in the car was not covered under it.
4.9 He would adopt the arguments of Mr Bhalodi to the extent that when the insurance company has charged the premium from the owner, then to that extent insurance company cannot be escaped from its liability to pay compensation.
4.10 Accordingly, both the learned advocates appearing for the respective respondents have requested this Court to dismiss the appeal filed by the insurance company. No further and other Page 10 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined submissions are made.
5. Points to consider:
Point No.1 Whether the tribunal has committed any error of law in holding insurance company liable to pay compensation when insurance company has issued liability only policy?
Point No.2 Whether in the fact and circumstances of the case, risk of deceased Rameshchandra being an employee of respondent No.2 travelling in the car owned by respondent No. 2 would be covered under insurance policy?
Point No.3 Whether insurance company can be held liable to pay amount of personal accident cover given under the policy?
Point No.4 Whether in the facts and circumstances of the case an insurance company may be permitted to place on record its terms and conditions of liability policy?
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6. Appreciation of submission and our findings:
Point No.1.
6.1 It is undisputed fact that deceased was travelling in the car owned by his employer Opponent No. 2. He was travelling in the car for office work. The policy which was issued by the insurance company was liability only policy wherein, no additional premium was paid by the owner of the car covering risk of occupant travelling in the car. The issue germane in the matter is squarely covered by the decision of Honorable Supreme Court in case of Balakrishnan (supra) which is followed by this Court in its various decisions. While deciding the issue of liability only policy it is required to be referred which reads as under:
"[21] In view of the aforesaid factual position, there is no scintilla of doubt that a "comprehensive/package policy"
would cover the liability of the insurer for payment of compensation for the occupant in a car. There is no cavil that an "Act Policy" stands on a different footing from a "Comprehensive/Package Policy". As the circulars have made the position very clear and the IRDA, which is presently the statutory authority, has commanded the insurance companies stating that a "Comprehensive/Package Policy" covers the liability, there cannot be any dispute in that regard. We may hasten to clarify that the earlier pronouncements were rendered in Page 12 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined respect of the "Act Policy" which admittedly cannot cover a third party risk of an occupant in a car. But, if the policy is a "Comprehensive/Package Policy", the liability would be covered. These aspects were not noticed in the case of Bhagyalakshmi and, therefore, the matter was referred to a larger Bench. We are disposed to think that there is no necessity to refer the present matter to a larger Bench as the IRDA, which is presently the statutory authority, has clarified the position by issuing circulars which have been reproduced in the judgment by the Delhi High Court and we have also reproduced the same."
6.2 In view of above stated position of law which stands as on date when insurance company has issued liability only policy, risk of occupant travelling in the private car could not be covered under it. The tribunal has failed to appreciate the decision so cited before it and without discussing how it cannot be made applicable, in the slipshod manner has decided the issue of liability and thereby committed serious error of law by holding insurance company liable to pay compensation.
In view of the said facts and position of law, we are of the opinion that risk of occupant travelling in car having issued liability only policy insurance company could not be held liable to pay compensation.
Page 13 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined 6.3 At this stage it is required to appreciate the arguments of learned AGP to the effect that in all Rs.10,49,239/- was paid to the legal heirs of the deceased Rameshchandra by opponent No.2. It is required to be noted that in absence of any pleading and or evidence led by opponent no.2 before tribunal in regard to such payment, we would have not entertained such argument but even otherwise also such payment has no co-relation with accidental death of the deceased. The payment which was made by opponent No. 2 to the legal heirs of deceased employee was liability of any employer in case of death of an employee and such payment cannot be adjusted with its liabilities arising under any other act i.e. M. V. Act.
So, such argument has no legs to stand so far as compensation awarded by the tribunal.
Point. 2.
6.4 To decide this point we would like to first refer Section 147(1) of the MV Act which reads thus:
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(1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-
(a) is issued by a person who is an authorised insurer; or
(b) insurer the person or classes of persons specified in the policy to the extent specified in sub- section (2)-
(i) against any liability which may be incurred by him in respect of the death of or bodily 1[injury to any person, including owner of the goods or his authorised representative carried in the vehicle] or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
(ii) 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:
Provided that a policy shall not be required-
(i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmens Compensation Act, 1923 (8 of 1923) in respect of the death of, or bodily injury to, any such employee-
(a) engaged in driving the vehicle, or
(b) if it is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicle, or
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability.
Explanation. - For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident Page 15 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined occurred in a public place."
6.5 Reading of above section makes it very clear that risk of employee travelling in the vehicle owned by the employer would not be covered except for earmarked class of employee i.e. driver, cleaner and conductor that too as per Workmen's Compensation Act, as the case may be.
6.6. To cover risk of employee of opponent No. 2, it was supposed to pay additional premium to insurance company.
Thereby, insurance company would have been held liable to pay compensation. After going through the Schedule of policy at Exhibit 48, we have not seen any such additional payment paid by opponent No.2 except premium covered Personal Accident, which is for the employees travelling in the car owned by opponent No. 2. Again, the issue germane is also squarely covered by the Division Bench of this Court in case of Oriental Insurance Co. Ltd. vs. Kirit Dharamsibhai Modi and Ors. in First Appeal No.3309 of 1996 wherein it has been held as under:
Page 16 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined [13.4] Considering Section 147 of the Act, 1988, terms and conditions of the insurance policy more particularly clauses 2 & 3 reproduced herein above and considering the facts that no additional premium have been paid for the employees traveling in the vehicle and the policy being Act Policy' and even if it is considered to be 'Comprehensive Policy', as observed herein above, in view of the aforesaid provisions and the decision of the Hon'ble Supreme Court in the case of Meean Variyal (Supra) and the decision of the Division Bench of this Court in the case of Gitaben Mukeshbhai Pathak (Supra) and Smitaben Wd/o. Bhogilal Jagjivandas Gadhia (Supra) in which the Division Bench did consider Section 147 of the Act, 1988 and the similar / same terms and conditions of the insurance policy and the exclusion clauses mentioned in clauses 2 & 3, we are of the opinion that the insurance company cannot be held liable to pay the compensation for the death/injury of the employee of the insured/owner of the vehicle traveling in the vehicle during the course of his employment. Consequently, we have no hesitation in reversing the impugned judgment and award/s of the learned Tribunal to the limited extent so far as it fastens liability upon the appellant/s/insurance companies to satisfy the award. However, it is clarified that if at all under the concerned insurance policy where the personal risk is covered, on payment of premium per person, the original claimants shall be entitled to the same to the aforesaid extent from the concerned insurance company.
6.6 At this stage, we also rely upon the decision of the Division Bench of Madras High Court in case of United India Insurance Company Ltd. vs. R. Krishnan & Ors. reported in 2021 ACJ 2379 in a similar situation and controversy at hand after considering various decisions, more particularly IMT 29, Page 17 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined the insurance company has been exonerated from paying compensation to the employee travelling in the car owned by the employer as employer has not paid extra premium for covering liability of employee travelling in the vehicle. It has been so observed as under, "20. Issue No.5 Whether the owner of the vehicle is liable to pay additional premium in terms of IMT-29 to cover its employees?
20.1 As far as fifth issue is concerned, now we have to decide whether the owner of the vehicle is liable to pay additional premium to cover its employees in terms of IMT-29?
To answer this issue it is relevant to extract the IMT-29 as follows:
"IMT-29 Legal Liability to Employees of the Insured other than paid driver and/or conductor and /or cleaner who may be travelling or driving in the employer's car (Private cars only/Motorized two wheelers (not for hire or reward) "In consideration of the payment of an additional premium @ Rs.25/- per employee insured notwithstanding anything to the contrary contained in the policy it is hereby understood and agreed that the insurer will indemnify the insured against the insured's liability at Common Law and Statutory Liability under the Fatal Accidents Act, 1855 for compensation (including legal costs of any claimant) for death of or bodily injury to any employee (other than paid drivers) of the within named insured being carried in or upon or entering in or getting on to or alighting from or driving the vehicle insured.Page 18 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024
NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined Provided that in the event of an accident whilst the vehicle insured is carrying more that ...* employees of the insured (including the driver) the insured shall repay to the insurer a rateable proportion of the total amount payable by the insurer by the reason of this endorsement in respect of accident in connection with such vehicle insured. Subject otherwise to the terms, condition limitations and exception of this policy."
20.2 The IMT-29 is relating to the payment of additional premium to cover the liability to employees of the insured other than the paid drivers/conductors/cleaners.
20.3 The terms and conditions of Section II-Liability to third parties, as stated above, clearly excludes payment of compensation to the employees of the insured under the category of third party liability. Section II ultimately provides that third party liabilities would be covered as provided under Section 147 of the M.V. Act. Section 147 of the M.V. Act, clearly spells out that premium paid by the insured would cover only the statutory liabilities as stated there under, excluding the liabilities to the employees of the insured. Therefore, under Section 147 of M.V. Act, it is mandatory for the insured to enter into a private contract with the insurer by way of payment of additional premium to cover its employees.
20.5 This Court vide orders dated 05.09.2019 and 23.09.2019 directed the IRDA to answer the following queries:
"(i) Whether the Insurance Company is liable to pay compensation to the occupant in a private car without paying additional premium under IMT-29?
(ii) What is the scope of IMT-29 after the issuance of circular dated 3 December 2009, by IRDA."?
20.6.1 As far as first query is concerned, the IRDA submits that theInsurance Company will not be liable to pay compensation in an accident for the occupants in the private car, who are employees of the insured/owner Page 19 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined travelling without obtaining coverage under IMT-29.
20.6.2 As far as second query is concerned, the IRDA answered that the circular, dated 03.12.2009 was not intended to modify the policy terms or include coverage for employee/occupant but only to deal with dispute being raised by the insurer for all occupants (other than employees/occupants) contrary to the express wording of the policy.
20.7 Thus, from the memo filed by IRDA dated 30.09.2019, it is clear that insurer will not have liability for occupants in a private car, who are employees of the insured/owner (except the paid driver) without obtaining coverage under IMT-29.
20.8 Therefore, if an employer intends to cover its employees, it is mandatory for the employer to pay additional premium in terms of IMT-29. In the event of non payment of any additional premium, in terms of IMT- 29, insurance coverage will not be extended to its employees. In the present case, admittedly, no additional premium was paid under IMT-29 to cover the employees of the insured. Therefore, without payment of additional premium certainly, the employees are not entitled to make any claim under the pretext that the policy issued by the insurer was a comprehensive/package policy.
20.10 At this juncture, it would be appropriate to deal with various case laws cited by Mr.M.S.Krishnan, learned Senior Counsel appearing for the owner of the vehicle. The learned Senior counsel referred mainly the latest decision of the Hon'ble Supreme Court in the case of New India Assurance Company Vs. Shanti Bopanna and other (supra). By referring the above case, the learned Senior Counsel contended that the Hon'ble Supreme Court has categorically held that the employees will be covered under the comprehensive policy. In the present case, since the Policy issued is under the comprehensive/package policy, he contended that the said case is squarely applicable for Page 20 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined the present case. However, on the perusal of the above judgment, it is clear that the additional premium payable in terms of IMT-29 to cover the legal liabilities to the employees of the insured other than paid driver had not been brought into the knowledge of the Hon'ble Supreme Court. Since the counsels failed to bring into the knowledge of the Hon'ble Supreme Court, the Hon'ble Supreme Court had no occasion to deal with about the applicability of IMT-29. The finding of the Hon'ble Apex Court in Shanti Bopanna case (supra) was made without testing the requirement of payment of additional premium by the employer to cover its employees under IMT-29. Therefore, we are of the view that the principles laid down by the Hon'ble Apex Court in the Shanti Bopanna case will not be applicable to the case on hand.
20.11 In all other cases, as referred by both the parties, there was no finding on the aspect of applicability of IMT-
29. Therefore, all the above cases referred by the learned Senior counsel appearing for the owner of the vehicle will not be applicable for the present case. In fine, we hold that in the present case, owner of the vehicle is liable to pay additonal premium under IMT-29, to cover its employees. Obviously, no additional premium was paid in terms of IMT-29. Hence, we are of the view that the insurance company is not liable to pay compensation as awarded by the Tribunal. Accordingly, Issue No.5 is answered.
21. Issue No.6 Whether the liability fixed by the Tribunal against the Insurance Company is correct?
21.1 The Tribunal has fixed the entire liability against the Insurance Company. In view of the finding in Issue No.1 to 5, we are of the view that the liability fixed against the Insurance Company suffers from infirmity and the same is not appropriate without the payment of any additional premium under IMT-29. In order to cover the employees of the insured, in case of death or bodily injuries arising out of and in the course of employment, no liability can be Page 21 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined fastened against the Insurance Company without payment of any additional premium. In the present case, as we found earlier, insured has not paid any additional premium to cover its employees under IMT-29. Therefore, the liability fastened against the Insurance Company by the Tribunal is not correct. Accordingly, we set aside the award of the Tribunal to the extent of the liability fastened against the Insurance Company alone. The driver, who drove the vehicle was an employee of the insured and due to the negligence on the part of the driver of the vehicle, the accident occurred. This Court already upheld the findings of the Tribunal with regard to the fixation of the negligence against the driver. The driver, being a servant and the owner of the vehicle being a Master, we are of the view that Thriveni/insured/ Company is liable to pay entire liabilities that arises out of this accident to the claimant. Accordingly, Issue No.6 is answered."
6.7 It appears that the aforesaid judgement of the Madras High Court was carried by the employee before the Honorable Supreme Court in Special Leave Petition No.7529 of 2020, which was dismissed by the Honorable Supreme Court vide its order dated 03.08.2022.
6.8 Likewise, the Division Bench of the Karnataka High Court in case of Manager Royal Sundaram Alliance vs. Chetan T K, Royal Sundaram Alliance reported in 2018 ACJ 555 also decided similar controversy as involved in the present case and Page 22 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined exonerated the insurance company from its legal liability to pay compensation for the accidental death of employee arising out of use of vehicle owned by the employer. The relevant para reads as under;
"[15] Reverting back to the Policy in question, it is marked in evidence as Ex.R1 and the very description of the document is "Private Car Package Policy". The break- up details of premium collected under the heads of A-own damage and B-liability is mentioned. Under the head A- liability Rs.800/- is collected towards basic premium including premium for TPPD and Rs.100/- towards personal accident benefit i.e., under Section 3 (Owner and driver) CSI Rs.2,00,000/-, Rs.250/- for unnamed passengers, Rs.25/-towards legal liability for paid driver. But no premium is collected towards legal liability of paid employee (IMT 29). As per Schedule of the policy Section II, the liability to the third party is not covered where such injury or death arises in the course of employment of such person by the insured. IMT 29 of the Schedule reads thus: Legal liability to employees of the insured other than paid driver and/or conductor and/or cleaner who may be traveling or driving in the employer's car (private cars only/motorized two wheelers (not for hire or reward)) In consideration of the payment of an additional premium @ Rs.25/- per employee insured notwithstanding anything to the contrary contained in the policy it is hereby understood and agreed that the insurer will indemnify the insured against the insured's liability at Common Law and Statutory Liability under the Fatal Accidents Act, 1855 for compensation (including legal costs of any claimant) for death of or bodily injury to any employee (other than paid drivers) of the within named insured being carried in or upon or getting on to or alighting from or driving the vehicle insured. Provided that in the event of an accident whilst the vehicle insured is carrying more than ..* employees of the insured (including the driver) the insured Page 23 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined shall repay to the insurer a rateable proportion of the total amount payable by the insurer by the reason of this endorsement in respect of accident in connection with such vehicle insured. Subject otherwise to the terms, conditions limitations and exceptions of this policy."
6.9 Thus, in view of above it is an undisputed fact that deceased was employee of opponent No. 2 owner of the car, travelling in the car for office purpose and considering the proviso of section 147 (1) of the MV Act as well as aforesaid decisions, in absence of any additional premium being paid by opponent No. 2 to cover legal liability of its employee, insurance company could not have been held liable to pay compensation for death of Rameshchandra, who happens to be employee of a opponent No.2.
Point No. 36.10 Learned advocate for the insurance company has submitted that Personal Accident Cover was given under the policy and for each of the occupant Rs.50,000/- as Personal Accident Cover was made available. As such, the same would be considered as contractual liability not statutory liability of the insurance company.
Page 24 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined 6.11 Considering peculiar facts and circumstances of the case and keeping in mind the year of accident i.e. 2005, this Court could not find it appropriate to relegate claimants to approach insurance company to get Rs.50,000/- under PA cover. The insurance company knowing fully well that deceased was travelling as an employee of opponent No. 2 died due to rash and negligent driving of drivers of both the vehicles, then as a prudent insurer, it could have deposited such amount before the tribunal or to inform the claimants about how to receive the benefit from it. None has been done. So, we are of the opinion that insurance company at least requires to pay Rs.50,000/- out of total compensation as awarded by the tribunal and to that extent we are holding the insurance company liable to pay Rs.50,000/- given under PA cover.
Point No. 46.12 The insurance company has filed an application to bring additional evidence on record i.e. terms and conditions of Page 25 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined liability only policy issued to the opponent No. 2. Such document which is sought to be brought on record, was already in the possession of insurance company at the given point of time. As terms and conditions authored by insurance company itself and having not submitted the same on record, insurance company cannot be allowed at this stage to submit it. As order 41 R.27 of CPC would apply while adjudicating such application but neither insurance company nor learned advocate appearing for the insurance company would be in a position to justify non production of terms and conditions of policy before the tribunal. None of the conditions and grounds so enumerated under O.41 R.27 of CPC made out in the application.
6.13 In view of above stated facts and provisions of law, we are unable to accept the prayer of the insurance company at this stage to bring on record the terms and conditions of the policy to fill lacuna on its part. Thus, Civil Application No.3 of 2012 (for additional evidence) filed by the insurance company Page 26 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined is rejected.
7. Conclusion 7.1 In view of the above stated facts, findings, and position of law stands as on date, we hereby hold that insurance company is not statutorily liable to pay compensation to the claimants.
Thereby, it is exonerated from its liability to pay compensation except Rs.50000/- under PA cover to the claimant.
7.2 In view of above, as discussed herein above, appellant insurance company is liable to pay only Rs.50000/- with 9% interest from the date of petition till its deposit and balance Rs.15,00,900/- with 9% interest from the date of petition till its realization to be paid by rest of the opponents jointly and severally.
7.3 Opponent No. 2 is the owner of vehicle whose employee Rameshchandra died during the course of his employment, is directed to deposit aforesaid amount of compensation and Page 27 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined opponent No. 2 is at liberty to recover 20% of its deposited amount from driver and owner of the truck by filing an execution petition, in accordance with law.
7.4 We have been informed by the learned advocates for the parties that entire awarded amount is deposited by the insurance company which is lying with the tribunal. If it is so, the insurance company is entitled to get back Rs.15,00,900/-
with proportionate cost and interest thereon from date of petition till its deposit then after interest accrued thereon in FDR.
7.5 The tribunal shall refund the said amount in favour of the insurance company through RTGS/NEFT in accordance with law. The balance amount of Rs.50000/- with cost and interest be paid to the original claimants forthwith on proper verification.
7.6 Once opponent No.2 will deposit Rs.15,00,900/- with 9% Page 28 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024 NEUTRAL CITATION C/FA/3408/2012 JUDGMENT DATED: 28/11/2024 undefined interest from the date of filing of the petition till its realization with tribunal, such deposited amount shall be disbursed in favour of the original claimants on proper verification in following proportion:
Claimant No. 1 (widow) entitled to receive 50% of total compensation through RTGS/NEFT. Balance compensation amount to be paid to Claimant Nos. 2 to 6 (children) 10% each through RTGS/- NEFT.
8. Thus, in view of above, the appeal is partly allowed to the aforesaid extent. No order as to cost. Record and Proceeding be sent back to the tribunal forthwith.
(BIREN VAISHNAV, J) (MAULIK J.SHELAT,J) DRASHTI Page 29 of 29 Uploaded by DRASHTI K. SHUKLA(HC00354) on Tue Dec 10 2024 Downloaded on : Sat Dec 14 03:22:55 IST 2024