Andhra HC (Pre-Telangana)
New India Assurance Co. Ltd. vs Voika Marrubai And Ors. on 11 November, 1998
Equivalent citations: 2000ACJ647
Author: R. Bayapu Reddy
Bench: R. Bayapu Reddy
JUDGMENT R. Bayapu Reddy, J.
1. This civil miscellaneous appeal is filed by the New India Assurance Co. Ltd., which is the respondent No. 2 in O.P. No. 243 of 1988 on the file of the Chairman, Motor Accidents Claims Tribunal-cum-Additional District Judge, Adilabad, questioning the award relating to the extent of its liability to pay the compensation awarded to the claimants.
2. The respondent Nos. 1 to 6 herein are the claimants. They filed O.P. No. 243 of 1988 seeking compensation on account of the death of the deceased V. Devanna in a motor vehicle accident that took place on 3.5.1988. The respondent No. 1 herein is the wife and respondent Nos. 2 to 6 are the minor children of the deceased. The respondent No. 7 herein is the owner of the lorry No. APK 7059 and it was duly insured with the appellant herein by the date of accident. On 3.5.88, the deceased who was employed as hamali (labourer) and who was aged about 40 years, was proceeding in the above said lorry belonging to the respondent No. 7 herein. At about 7 p.m. when the lorry was proceeding near Gouliguda Bridge of Vannelavagu on the National Highway No. 7, the driver of the said lorry drove the same in a rash and negligent manner and as a result of the same the lorry turned turtle causing injuries to the deceased, who subsequently died on account of such injuries on 13.5.88 while undergoing treatment. The death of the deceased was on account of the rash and negligent driving of the above said lorry by its driver. The claimants, therefore, filed the petition seeking a total compensation of Rs. 1,00,000 from the owner as well as the appellant. On the basis of the evidence adduced before it, the Tribunal came to the conclusion that the deceased, who was working as hamali and who was proceeding in the above said lorry, received injuries on account of the rash and negligent driving of the said lorry by its driver and subsequently died on account of those injuries. The Tribunal awarded a total compensation of Rs. 53,800 under various heads and directed the owner of the lorry as well as the appellant insurance company to pay such amount with joint and several liability to the claimants. The owner and the claimants have not questioned the said award. The insurance company has, however, filed the present appeal questioning the said award, contending that its liability is limited to the extent of the amount that will be payable to the claimants under the Workmen's Compensation Act as the insurance policy does not cover the risk to such employees like hamalis; that the liability under the Workmen's Compensation Act is to a tune of Rs. 23,000 in view of the age of the deceased and that, therefore, the award of the Tribunal may be modified to that extent.
3. Heard both the counsel.
4. The point for consideration is whether the liability of the appellant insurance company shall be limited to the extent of its liability to pay the compensation under Workmen's Compensation Act as contended by the appellant?.
5. The deceased was admittedly employed as hamali in the lorry which was involved in the accident and at the time of the accident he was proceeding in the said lorry as such employee of the owner. The appellant does not dispute the fact that the accident which resulted in the death of the deceased was on account of the rash and negligent driving of the lorry by its driver. The owner of the lorry has not chosen to question the award and as such he is liable to pay the entire compensation of Rs. 53,800 awarded by the Tribunal. The appellant insurance company, however, contends that its liability is limited to the extent it will be liable to pay the compensation under the Workmen's Compensation Act and that the amount that will be payable under the Workmen's Compensation Act in view of the age of the deceased and other factors is Rs. 23,000. The contention of the learned counsel for the appellant is that the insurance policy which was issued in favour of the owner of the lorry does not cover the risk for such employees of the owner as hamalis and no separate premium was paid by the owner to cover such risk and that in view of the provisions of proviso to Section 95 (1) (b) (ii) of the Motor Vehicles Act, 1939 which alone is applicable to the present case, its liability is limited to the amount that can be awarded under the Workmen's Compensation Act, 1923. He has also tried to rely upon the decision of the Orissa High Court in Oriental Insurance Co. Ltd. v. Guru Charan Saren , in support of his contention in this regard. It is observed in the said decision, relying upon the Division Bench decision of the same court in Orissa State Road Trans. Corporation v. Shankar Sahu 1989 ACJ 867 (Orissa), that the insurer is not liable to pay compensation more than that fixed by the Workmen 's Compensation Act. In the decision of the Supreme Court in National Insurance Co. Ltd. v. Jugal Kishore 1988 ACJ 270 (SC), it is observed by their Lordships that a comprehensive insurance of the vehicle entitles the owner to claim reimbursement for the damage suffered by the vehicle and that it does not, however, mean that the limit of liability with regard to the third party risk becomes unlimited or higher than the statutory liability. It is no doubt true that in a Division Bench decision of this court in Mandulova Satyanarayana v. Bodireddy Lokeshwari , it was observed that the employee or his legal representatives have an option either to sue the owner under the Workmen's Compensation Act or to file a claim under the Motor Vehicles Act and that when a claim is made under the Motor Vehicles Act, the insurer's liability is not limited to the liability specified under the Workmen's Compensation Act. But a perusal of the said Division Bench decision of this court, however, shows that the employee concerned in that case was mentioned as cleaner in the lorry which was involved in the accident and that the owner had paid extra premium covering the risk of the driver and the cleaner, as seen from the insurance policy which was marked as Exh. B-5 in that case. In view of such extra premium paid by the owner under the insurance policy in that case, the insurance company had undertaken the liability to the extent of Rs. 50,000 regarding the driver or the cleaner of the vehicle. Evidently in view of such facts and circumstances revealing that the owner had paid extra premium to cover the risk of the cleaner, this court had observed in that Division Bench decision that the liability of the insurance company cannot be limited to that under the Workmen's Compensation Act, This is clear from the following observations made by the Division Bench in that case at page 974:
But where an agreement was entered into and a policy is taken under which the company undertakes the liability prescribing a limit, it is bound by the policy. Otherwise, the provisions of the Motor Vehicles Act empowering a person to claim compensation either under the Motor Vehicles Act or under the Workmen's Compensation Act would be defeated.
6. In the present case, it is seen from a copy of the insurance policy marked as Exh. B-l, that extra premium of Rs. 16 was paid to cover the risk for the driver and the cleaner and that no extra premium was, however, paid to cover the risk of other employees such as hamalis, etc. In the absence of any such extra premium paid by the owner to cover such risk and in view of the terms and conditions of Exh. B-1 insurance policy, the appellant insurance company can be held liable to pay compensation only to the extent specified under the Workmen's Compensation Act as per proviso to Section 95(1)(b)(ii) of the Motor Vehicles Act of 1939 which is applicable to the present case. Therefore, the award of the lower court is to be modified accordingly restricting the liability of the appellant insurance company to the amount payable under the Workmen's Compensation Act. It is now not disputed that the amount that will be payable to the claimants under the Workmen's Compensation Act will be Rs. 23,000 in view of the age of the deceased, the nature of his employment and other circumstances. Therefore, the appellant insurance company will be liable to pay only an amount of Rs. 23,000 to the claimants.
7. In the result, the appeal is allowed but without costs and the award of the lower court is modified restricting the liability of the appellant insurance company to Rs. 23,000.