Karnataka High Court
The Oriental Insurance Company Limited vs Smt Drakshayanamma on 23 September, 2010
Equivalent citations: AIR 2011 KARNATAKA 159, 2011 (2) AIR KANT HCR 439, (2012) 2 ACC 276, (2012) 3 TAC 902, (2011) 4 ACJ 2589
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
DATED THIS THE 2390 DAY OF SEPTEMBER 2O1Q'E'._V'
BEFORE _ %
THE HON'BE_E MR. JUSTICE ARALI NAG,A ARAJ ff _
MISCELLANEOUS FIRST APPE/i§:\:E_»AA'|v\|:,(§.'}j'.3'23S/260$'T..,,,_'_: 3
MISCELLANEOUS FIRST APPE'AE."'»NOS. 1311631', 33162,
13163, 13236, 13237, 13413.,.1»3O414, 134'3.--S.,,,13?416,
13417-3; 13'14_8/2005-.,,,
BETWEEN: '
THE ORIENTAL"I-NSL}F{A.E\iCE.COMPANY'--LTD,"
3 C ROAD,TL%1vIKUR '
THROUGH ITS.,RE§3:ONA:_'OFE1CE
LEO SHOPP1N.G'€OM'P:,E.x
44-45, E:,ESIOE'NCy RO1ADcT<OSS_ --
BANGALOREr~4 S6652-»S 1 '
BY ITS ASST. '--MANAGE._§<T_ "
1 _ APPELLANT
"(COMMON IN ALL THE CASES)
V' "(By SRLO-PTMAEJESH A"D'v)V
IN' MEA N,O.1§2S35/2006
SMT;:.DRAKSHAYANAMMA
.. W/O SHTVALTNGAIAH
_ 'AGED 47 YEARS
* «R/O DODDER1
TUMKUR TALUK
IN MFA NO.13161/2006
1. RASHMI
D/O RAEASHEKARAIAH
AGED 24 YEARS
R/A OPRHARSHA INSTITUTE OF
COMMERCE, KUVEMOPUNAGAR
TUMKUR
IN MFA NO,l3162/2006
1. D N BHARATHI
D/O H NANJUNDAPPA _V
AGED 27 YEARS
R/A DODDERI, BELLAVI HOBIAIAIA:
TUMKUR TALUK
IN MFA NO.13l63/2006
1. SHUBHA
D/O H SID~'DARAM'1§i._$& g
AGED 29.x<.EAs§s ~
R/A SHIVAKUMARASWIA-MY VN1'ILA'~:A'V« '
ASHOi<NVAC¥i»'-\R,,. 6"'"'"' CRCJSES
IN MFA N'b..1'3236z'2:O'CY.5i'~'AA'"--.,:a"' A
1. SMT.G VIMAL.A ._
{W/QD S SIDDARAMAIAH
,_"*A<3E_LD 44 YEARS .....
A R/(3 DODDERI
-.TUMK!J?L.TA--LUK & DIST
NVb;Vi":3:23';¥/$2006
A . I. .""?2.A31;Asé+I'E§<ARAIAI~I
S70 M R NANJAPPA
A MAJOR
_ "HEALTH INSPECTOR
* "CITY MUNICIPALITY
TUMKUR
W
IN MFA-NOJ3413/2006
1. J R SHETHAL
S/O G RAJASHEKARAIAH
AGED 17 YEARS
WA 3 C PURA, C N HALLI TALUK
TUMKUR DEST, MINOR
REP BY HIS FATHER
SRI.G.RAJASHEKARAIAH
IN MFA NOJ3414/2006
1. K S JYOTHI
DID H SIDDARAMAIAH
AGED 30 YEARS
Rm 5*" caoss, s 3 Pu.RAM«""'W_ " 5;
TUMKUR
IN MFA No.13-415/2906 '
1. 95310::/:;_¥2A'?;1mi;\H:K
S/O s1DD:xL1_Ne:a.A;PPA«..
AGED A3oL;§T';s3 Y'EARxS5f_- '_ * §
R;o..mQoD..ERI,'-I£sELL.Af;;;_Hoa--L1,.._
TuvMKuRR*TA§,uKv":.' 4 _
IN MFA N'b,'i';241es/2:oo°§.,_'R'~_,_:'~ 2
1. SMT.RA'.THNA .
RAJA§fij:-K';-';:=: M': rim
'~;~.'~xc3Er:> ,D5BOUT"49...YEARS
A 0PPR."HARSHA INSTITUTE OF
~ .Vcc1;$¢':v:E:2_C'E_,.1KUVEMPUNAGAR
' Tt.e.,:s%u--<:¢U's2
IN 'zv;.u§A No..:3'{;.1'%/2006
SHWETHA D s
A. W/O 9 s SIDDARAMAIAH
" V "AGED ABOUT 22 YEARS
R/0 DODDERI
TUMKUR TALUK
IN MFA NO.13418/2006
1. SHRUTHI D S
D/O D S SIDDARAMAIAH
AGED 23 YEARS
R/A DODDERI
TUMKUR TALUK
2. RAJASHEKAR A
S/O ARASAIAH 7
MAJOR
NO,756, II MAIN ROAD
JAYAPURA EXTENSION
TUMKUR %_= <_'== 5
_ _'*vI.._."P,ESPO?\}D_ENTS
1{'"R~?, COIvIMoN _4li\EVA'L1_ THE CASES)
(By SRIvuTHS:M R SHASHID'H.AVR&-Ii} SR_I.N'I~»§kA.§r'_v,ADvs)
THESE :vIFAs_:_AP._E 1=.:;LED L;§;'S~..17~3'_(VJ.) 'OF MV ACT AGAINST
THE JUDGMENT Al\_£B' ,AwARD_ 'DATED 'o6'.'o9'.2oo6 PASSED IN
MVC NOS.112'8}'1._9'9.?;:*_V 11_2.3_/1.997, *aj11_2'5/1997, 1127/1997,
1129/1997, '1113o/11997'; '11'I36,I1'99I7, 1124/1997, 1131/1997,
1I32/1997T,..1:'1'3.4/'199:7,AND.1135;.1.997 RESPECTIVELY ON THE
FILE OFZVTHE PRESIDING OFEICER,.FAST TRACK COL.$R"i"--III AND
MACT, TUMKLJR, AwA..RDIINEIIVAIIIICOMPENSATION OF RS.45,700/-,
22,000/--,'A.22,.oo0/5,'*5_9,_56o/5.411,500/-, 11,000/~, 24,000/~ ,
36,450/~, «.11,~ooo/---, ".A24,2--5o/-- 29,250/-- AND 28,000/-
RESPECTIVELY.W'ITH'--.IN'aTEREST @ 6% PER ANNUM FROM THE
DATE OF P_ETITI(3i\I_T'IVLL DEPOSIT.
T'H'*EjsED%0'Me_FAS ARE COMING ON FOR HEARING THIS
DAY, =TAHE_'CQUART. MADE THE FOLLOWING:
COMMON JUDGMENT
"A.E§ii;hese 12 Misceiéaneous First Appeais have arisen A w.:0froVI%i"'-the Same Common Judgment and respective Awards defied 06.09.2006 passed in MVC No.1123/1997 and other :--~§'x'"""\/-w 5 connected cases on the file of learned Presiding Officer, Fast Track Court»-m and Addl. MACT, Tumkur (hereinafter referred to as 'MACT' for short).
2. The respective motor "vehicle com;oer}'sati'ion_VA' cases were filed before the MACT by in3'ured~claimants claiming compgensatiojn'__towards<.__th.§Ti' bodily injuries sustained-byggrthem inhfthe it/ehlgc.i'e V accident that occurred on atfablout 3:90 pm. on Huliyur road near:Aladelcagttefi.within the limits of Chiknayakarzahaili policeVV_statio.n"V»in T;'u,frr1Ai<uf_'.-District which was caused ;b$/;g.t'i1elidriyeri 'of:"'i\?iata.c'§or Van bearing registratior-2 driving it in a rash and negligent 'rngariinger; _A'ilV.:the's»e4 appeals are by the insurer of the gsiaifd=vehicl'e.w._.V:'Respondent No.1 is the claimant and .respoi:den.t«.i§l'o,Z is the owner of said vehicle in each of ffthes-el«aVpperals'.~f§;;"'The same set of facts and question of law _ are'"i'nvo'!'\:/ed"in all these appeals. Therefore, these appeals ".c,.:ai'esd_isposed of by this Common Judgment. M
3. I have heard the arguments of Sri.O Mahesh, learned Counsel for the appellant Insurance Companyjand Sri.M R Shashidhar, learned Counsel for the claimants in all these appeals. Perused Judgment and respective Awards.
4. It is not in disputeV__ti':aVt the'- accidvent,l'7i;n'v~olving the said vehicle, occurred on and place and that as a result of claimants in each of the saidcases It is also not in dispute due to rash and negligent_dVr_iAvin::'g by its driver and that second:Virespon.der.u't:-vvas»"t§oée"own"er thereof.
5. ."4_£"heV second »--re's.pondent, the owner of the said vehi',c_ier'ras notchoser. to contest these appeals despite lreceljpt _or5.noti'ce of appeals.
heard the Eearned Counsel for both the
--V sides', tti-e'.ori"lVy point that arise for my determination is:
u?* 7 "Whether the MACT is justified in directing the appellant Insurance Company to pay to the respective injured claimants in all the said cases the respective amounts QfT_ compensation awarded by it, despite recor«d.injgVV":"~.3. its findings that the policy of Zinsuranceiithatiwei was issued by the appel.i.an_t insu.«ei;ee "
company was cancelled much :e.a'r_i.ie"r_to."-th'ef~..V occurrence of the accident for'~the._ reason tha': V the cheque that was issuedede by."th__e'oVw'ne'rf:o'f"' vehicle towards premium__had,_bo_unceo?«
7. The foiiowiragdfactzs are .l'n"otf'di_spute:
a) _The appeillarntv.Insura'n'ce--'iCompany issued 'inAw.iV7.'»avo'£ir' Ofisecondiiirespondent owner Ex.D3 0' _ce'r*:ificat.efcu'm.f'po|icy in respect of the said "'--__rnatador"'iya'nA':'_'yaiid for the period from 10.00 hvours"'1on'V' 17.08.1996 till mid night of The owner of the said vehicle :'Vji'ss"ued Ex.D1 cheque dated 16.08.1996 for being the premium towards ' -insurance of the said vehicie.
b) The said cheque came to be returned to the Insurance Company dishonoured for want of funds in the account of owner of the said 4'"-'-rfir\""\-r vehicie. Ex.D4 is the intimation given by the bank to the insurance company in respettsyof dishonour of the said cheque.
Insurance company cancelfed the.-§V__p'o'l'icyy:'---._of'...._T'. insurance issued in respect of th.e..s_javi.dVveh.icieV"
and Ex.D6 is the copy"'oVf"'canCeiiatio_h«._notice.".
and Ex.D7 is the posta'?
the effect that said notice" was recei'ved4..by that owner on 27.O8.1996;..y_V"h' _
8. Thus, it 'froin.th¢,,fA.§~bove undisputed facts that though they.v~-Ensiuraynce "c'erti:fi:ca.te~cum--po|icy (Ex. D3) was _i rance company for the period.V.f'roVafnh.» iff7.foa]fi'is9s:yfto ::a.o8.1997, it came to be cantfgelieydi canceliation came to be intimated"to4'the'i'nsu:red_4':anVd' the intimation of cancellation was rgecesitx/ed.' by: the insured on 27.08.1996 i.e., much Reariiér to"fthe'~occurrence of the accident which occurred on being so, it is further clear that as on the 'd.ate,._fof-occurrence of the said accident, there was no jtfaiid insurance in force in respect of the said vehicie. '______(--rs\,,....
9. On careful reading of the impugned common judgment, it could be seen that MACT has recorde,dw.its finding that since the Insurance policy which the Insurance company was cancelled much ea4r__ijierjV'toxf'the occurrence of the accident ar:d""tl*.ey_ "..Aint;imla"ti%V..fofn"'. cancellation of insurance was aiso gi__ven_ to the-Ao»wner--t.4'o~fy "
the said vehicle, the insurancefiompalhnygist.n'otnV"iiga'bl'es to indemnify the owner invrespectvof Vin-3i.uries' sustained by the respective claimantsllilnfalllt-the'said-t. who are all admittedly third pi§rties.;;l
10. r.Ie_'ai'rne§dV Counsel for the appellant strongly contends that despite recorudlinggxthe'saidffinding, the MACT ought not to haVe._§gfi:irectedV""the. _____ insurance company to pay the res'p.ective«.yam'ounts of compensation to the respective ciairnantsin~the"said case and then recover the same from .6 the ownerioffithe said vehicle and therefore, the impugned if and respective awards insofar as they relate to Sta-idldirection deserve to be set aside. ___~§"-~r'\'_,,..
11. Placing strong reliance on the subsequent decision of Hon'b|e Supreme Court in the casoeioof Daddappa and others Vs Branch Manager,;~~:\iati_o'na:l"
Insurance Co. Ltd., reported in 2008 AC3.V_Si$1,'!:¢'ar'ned*«i Counsel for the appellant Insurance»::A'coVmpainy.:_':st['oV:ngVlVyyVi' contends that when the Insurance piolyicy. was :c'an<§el'led*: ijy V the Insurance company and 'cancellation.V_o"nit-theggground that cheque issued bY:::the vehvivcileftowards premium was dishonoured'-a_nd,"_thfe cancellation of the policy the insurance company the owner in respectiof"Iiguvfrives:7'sustai.n.ed claimant in the said cases, h ' rties.
12.; Per' c.ontra,: placing his strong reliance on the decision of Kerala High Court in the case of i'lI:!_rié-._:f:Mt1a'l' :'i'_nsui'jarice Co. Ltd., Vs Sivankutty and Others reporteci"i-n':""2906 AC} 106, learned Counsel for the J'resop.ond'ent~claimants strongly contends that insofar as 3""
parties are concerned, the Insurance Company is liable to «.-~S~---""""
11
pay compensation despite the insurance policy being cancelled by it earlier to the occurrence of accidenVt'e'o'rie.the ground that the cheque that was issued by M the vehicle was dishonored.
13. I have carefully decisions relied upon by the r_és.pectiye.__ie'a.rne:d"'co'uiisel for"
the parties. Full bench of Ke.ralV:a'v--Hi'g..h Courtvvhasjobserved at para 20 of its judgncientt "2Q;" .i\ieit3her" V'-three member decision '._.the. in Irideijit Kauiis nor from the .iprOV'tisi:c?:nSA6ff 'secti,o'ns 1'47'(s') and 149(1) of the Motor '1988 do we get any support to vh'old:.4':th,e'Vyiew that the liability to ._pay ""C0_tnpie.i1sa"tioén" for injuries sustained to i;r'h'irt§__ par"t'ies---~'ceases to exist after the of the policy. The situation is not of an owner of a vehicle not having any insurance at ail for the vehicle as on .. the date of the accident, as is observed by the _ iiiivision Bench of this Court in New India Assurance Co. Ltd., V Raghu, 2002 AC] 217 (Keraia). We, therefore, hold that the decision ¢_---{.\'-'"\...-""_'V of the Division Bench of this court in New India Assurance Co. Ltd, V Raghu (supra) does not . lay down the correct law. The position is that the iiabiiity of Insurance company in damasg__es:'cl for third party risks continues for the entiyrei' period covered by the policyyyin spite"'of:'_the~»:
cheque issued towards payn:1en:t:,4yoj;f was dishonoured and consequ'enti.y. poiiicyyywas it E cancelled by the insuqracncey cohmpaanyt remedy of the insurance__corn_pany iies.a_g:;ainfst the 'insured' to thléiai7i%i(5b!._fi1T.::rJa'id by by way of compensat.ion'for risks to be 901: reiI",'7':Vi'>Li.rs€C5}WV"V it it it Vans-we.:'ed as above.
Tvhetiiiiiergistry"shali"aV.ppro>ti'Vrn'ate|y piace the file before theffreferriin.q"_.Bench alongwith the answe_r "on IEhe'4vi'EfEfé}.3Ce for further appropriate ;VaCEi.0n in '-the'rnatter."
»ii'ow'e.ver, the Hon'b|e Supreme Court has 'para Nos.11, 16, 20, 26 and 27 of its ~ --4%.i.i'.j';.-4.._'_"-.3udgm'e.r}t~ in Daddappas case (2008 AC3 581) as under:
W .13
11. "Indisputably, the accident had occurred on 6.2.1998 that is much after communication of cancellation of the policy".
16. "The question came is consideration before this Court in."'Ir7derjif'~:
Kaur's case, 1998 AC3 123;g(scj,' :wh_er'e.in_ was opined that a policy of in'sura.n'ce wh-ichrvis V' K issued in public interestwyorayld prevail _over't_:he' interest of the insurance con1,,pany. In't«.hat case a bus met with ariicid_ent.,_V_.,ifhe% policyflyof insurance was letter stating thatthe ciliegue-1hadjfbeen diisihononred was to the premium was paid Theuaflccident took place 19'-.4.'1_990.itEiesp'il'te'n,oLicing Section 64-VB of the 1938p it/'1'.ct',1_ having regard to the 4innderlying_p'ublic' policy behind the statutory A 'scifi"em'e_in respeéct of insurance as evidenced 147 and -Section 149 of the Act ganucl' i'.n--._p'a.rt'icular having regard to the fact that po.!__'i'Cy-of insurance to cover the bus without receiving the premium had already been h"-~.i.ssued, this Court held that the Insurance it "Company was liable to indemnify the insured".
W I4
20. "The ratio of the said decision was, however, noticed by this Court in New India Assurance Co. Ltd. v. Rula, 2000 AC] 630 (SC). It was held that ordinarily a liability_H_"c under the contract of insurance would only on payment of premium, if such payment.V,: 3 was made a condition prec_ecle_nt 4' effect of the insurance pol_icy:.,.hliitu*.su.c'h~- condition which is intended forthe l3en.efit"oi' the insurer can be waivedv.,,4l''3''y_,it''. ' "It was opin'e.c_|:-- "«*("i'11'_i)5:li,if,,"}5n,.the damper accident, there was ;_a 'po.l1'icy _of-.V'i_n.surance in respect of_*th_e vehi'cl-e:"'in".q:'uestion:,'7the third party wo._ulcl}1jh'ayevV:a, claim a,c;lai'l'ist't*ii'e Insurance compan~,?j1cand3tyftilsgiawnerlor the vehicle would hayefto bei*n"cl«emnif:.ed_.in respect of the claim of th'a.t"p.arty,'uSu"bs_equent cancellation of the éginsurance policy on the ground of nonpayment €of»--."premium would not affect the rights already in-.favour of the third party".
v_ dicta laid down therein clarifies i.=ha't; if on the date of accident the policy " 'fi---._subsists, then only the third party would be V' "entitled to avail the benefit thereof". r"----("Sr-_"'#.
17 the amount of claim to the appellants herein and recover the same from the owner of the vehicle namely respoéndent No.2". Such direction cannot be issued claims Tribunal or even by this Court.
17. Following the above1"ob:sAervatio'ns"of:
Supreme Court, I am of thefonsidered' the appellant Insurance 'Compagny 'natty lial5lQ..,.to"V:pay any amount of compensatiohfi claimants in the said cases; .__The:'retore¥, issued by the Tribunal in and the respective shall pay compensation to iiblaimants and then recover the same from" said vehicle deserves to beset aside.
i3_." -- lfo.rgiti:1;e'e.reasons aforesaid, all these appeals are i it here A it The impugned Common Judgment and the V "re'spiective Awards in the said MVC cases insofar as __they relate to the direction that the appellant € Insurance company shall pay compensation to each of the claimants and then recover the same fromthe owner of the said vehicle are hereby set asic_ie,V_:"3£t_*'.s made clear that respective claimants are M recover the compensation amount from'_t'r'.-ei the said vehicle. No order as vto"'cc.sts.T_" ht 4' Whatever amount.sisy_depos.é_te'd by oth'euadppei'['ant Insurance Company in"'~vs.othese a'-p_peaI_"s "shall be returned to it. I The original _ofV:['thVis.v"__3uidg*m.en»t.'jshalI be kept in MFA No.:132'V3:5/20_06€ aha -4.a"'~.é;opVy'1fjnereor in each of P, the o't!'i'er' =7;
Sd/-7* JUDGE aw ',:::v<k"V:" tttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttttt at