Madras High Court
M/S.Tata Aig General Insurance vs Thirupathi ...R1 In Cma on 5 April, 2024
Author: N.Anand Venkatesh
Bench: N.Anand Venkatesh
C.M.A.Nos.1515 & 3080
of 2023
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 05.04.2024
CORAM
THE HON'BLE MR.JUSTICE N.ANAND VENKATESH
C.M.A.Nos.1515 & 3080 of 2023
and CMP No.15461 of 2023
M/s.TATA AIG General Insurance
Company Ltd., Salem-4. ...Appellant in
CMA.No.1515
of 2023 & R3
in CMA.No.
3080 of 2023
Vs.
1.Thirupathi ...R1 in CMA.
No.1515 of
2023 &
appellant in
CMA.No.3080
of 2023
2.Pravinraj ...R2 in CMA.
No.1515 of
20203 & R1 in
CMA.No.3080
of 2023
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C.M.A.Nos.1515 & 3080
of 2023
3.M/s.Panchiyamman Distributors,
Salem District. ...R3 in CMA.
No.1515 of
2023 & R2 in
CMA.No.3080
of 2023
4.Senthil Kumar
5.Premavathi
6.The United India Insurance Co. Ltd.,
No.10A, Ranga Building Peramanur
Main Road, Near Four Roads, Salem. R4 to R6 in
both CMAs
Civil Miscellaneous Appeals under Section 173 of the Motor
Vehicles Act, 1988 seeking to set aside the final award dated
15.6.2022 passed in MCOP.No.94 of 2020 on the file of the Motor
Accidents Claims Tribunal (Special District Court), Salem.
For Appellant in CMA.No.
1515 of 2023 & R3 in CMA
No.3080 of 2023 : : Mr.J.Michael Visvasam
For R1 in CMA.No.1515 of
2023 & Appellant in CMA.No.
3080 of 2023 : Mr.T.S.Arthanareeswaran
For R6 in both appeals : Dr.C.Paranthaman
2/17
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C.M.A.Nos.1515 & 3080
of 2023
For R2 & R3 in CMA.No.1515
of 2023 & R1, R2, R4 & R5 in
CMA.No.3080 of 2023 : No appearance
COMMON JUDGMENT
The issue involved in both the appeals is common and hence, they are heard and disposed of through this common judgment.
2. The Insurance Company has filed CMA No.1515 of 2023 questioning the liability for payment of compensation to the 1st respondent fixed by the Motor Accidents Claims Tribunal (Special District Court), Salem (for short, the Tribunal below) in MCOP No.94 of 2020 by award dated 15.6.2022. The claimant filed an appeal in CMA No.3080 of 2023 challenging the same award seeking for enhancement of compensation fixed by the Tribunal.
3. The case of the claimant is that on 24.6.2019 at about 12.10 p.m, the claimant was traveling in a TATA Ace Vehicle 3/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 bearing Regn.No.TN-30-BT-3128 for supplying water cans to various shops, that when the said vehicle came from Salem – Bhavani Main Road and was nearing Sankari ATC Depot, the driver of the said vehicle hit the bus bearing Regn.No.TN-30-BD-1200, which was coming in the opposite direction, that due to rash and negligent driving, the claimant sustained grievous injuries and that yet another person, who was traveling in the same vehicle viz., one Mr.Ajith Kumar died due to the accident on 27.6.2019.
4. The claimant sustained fracture in his left femur bone and left mandible region and underwent surgery and he had also incurred expenses towards treatment. It was under these circumstances, the claim petition in MCOP No.94 of 2020 came to be filed by the appellant in CMA.No.3080 of 2023.
5. The Tribunal below, on considering the facts and circumstances of the case and on appreciation of evidence, came to the conclusion that it was only due to the rash and negligent 4/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 driving by the driver of the TATA ACE vehicle, the accident had taken place. Having rendered such a finding, the Tribunal proceeded further to fix the compensation payable by the Insurance company.
6. The Insurance Company took a very specific stand that as per Ex.R2 policy, the liability covers only two persons viz., driver plus one person. However, totally three persons had traveled in the vehicle. Therefore, the Insurance company denied the liability in so far as the claimant in MCOP.No.94 of 2020 was concerned.
7. The Tribunal below, while considering this issue, came to a conclusion that two persons had traveled in the vehicle as “load men” and that they were utilized for the purpose of loading and unloading of water cans. Therefore, it was held that there was no policy violation.
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8. The Tribunal below thereafter proceeded to fix the compensation under various heads and in so far as MCOP No.94 of 2020 was concerned, it fixed a total compensation of Rs.9,00,000/-
together with interest at the rate of 7.5% p.a.
9. The claimant, not satisfied with the compensation amount fixed by the Tribunal below, filed CMA.No.3080 of 2023 seeking for enhancement of compensation. The Insurance Company denying their liability to pay any compensation to the claimant in MCOP.No. 94 of 2020, filed CMA No.1515 of 2023.
10. Heard the learned counsel for the respective parties.
11. This Court has carefully considered the submissions made on either side and also perused the materials available on record.
This Court has also carefully considered the award passed by the Tribunal below.
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12. It will be more appropriate to take up the appeal filed by the Insurance company since it touches upon their liability to pay the compensation to the claimant. Depending upon the result in this appeal, the issue as to whether the compensation has to be enhanced for the claimant or not can be decided in the other appeal.
13. There is no dispute with regard to the fact that totally three persons had traveled in the TATA ACE vehicle. One was the driver and the other two persons were the load men, who were utilized for the purpose of loading and unloading the water cans. As per Ex.R2 Policy, it covered a maximum of two persons, which includes the driver.
14. In view of the same, the only issue that requires consideration is as to whether the Insurance Company is liable to pay the compensation to the claimant herein.
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15. The learned counsel appearing for the Insurance Company submitted that the Insurance Company has already settled the claims of both the driver and the legal heirs of the deceased, who filed MCOP No.2022 of 2019. Thus, it was contended that the Insurance Company fulfilled its obligation under the policy.
16. The present issue is squarely covered by the Judgement of the Apex Court in [National Insurance Company limited Vs.Anjana Shyam and others] reported in 2007(2) TN MAC 193 (SC). The relevant portions in the judgement is extracted hereunder :-
12. Section 58 of the Act makes special provisions in regard to transport vehicles. Sub-Section (2) provides that a registering authority, when registering a transport vehicle, shall enter in the record of registration and in the certificate of registration various particulars. Clause
(d) provides that if the vehicle is used or adapted to be used for carriage of passengers, the number of passengers for whom 8/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 accommodation is provided. Thus the registration of the vehicle, which alone makes it usable on the road, records the number of passengers to be carried and the certificate of registration also contains that entry. So, an insurance company insuring the passengers carried in a vehicle in terms of Section 147(1)(b)(ii) of the Act, can only insure such number of passengers as are shown in the certificate of registration. The position is reinforced by Section 72 of the Act, which deals with grant of stage carriage permits. Sub-Section (2) provides that when a permit is decided to be granted for a stage carriage, the Regional Transport Authority can attach to the permit one or more of the conditions specified therein. Clause (vii) is the condition regarding the maximum number of passengers that may be carried in a stage carriage.
Overloading also invites a consequence which can be termed penal. Section 86 of the Act provides for cancellation of a permit if any condition contained in the permit is breached. Therefore, the apparent wide words of Section 147(1)(b)(ii) of the Act have to be construed harmoniously with the other provisions of the Act, namely, Sections 58 and 72 of the Act. As early as in 1846, Dr. Lushington in Queen V. Eduljee Byramjee [(1846) 3 MIA 468] posited that to ascertain the true meaning of a clause in a statute the court must look at the whole statute, at what precedes and at what succeeds and not merely at the clause itself. This Court has 9/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 accepted this approach in innumerable cases. Thus, the expression 'any passenger' must be understood as passenger authorized to be carried in the vehicle and 'use of the vehicle' as permitted use of the vehicle. Affording of insurance for more number of passengers than permitted, would be illegal since in that case the manifest intention would be the overloading of the vehicle, something not contemplated by law. Thus, it is not possible to accept a contention that the insurance can be taken to cover more passengers than permitted by the certificate of registration and the permit as a stage carriage and that it will cover all the passengers overloaded. Of course, in these cases, there is no dispute that the insurance cover took in only the permitted number of passengers.
13. In this situation, the insurance taken out for the number of permitted passengers can alone determine the liability of the insurance company in respect of those passengers. In terms of Section 149 of the Act, the duty of the insurer is only to satisfy judgments and awards against persons insured in respect of the third party risk. Obviously, this is to the extent the third party risk is coverable and is covered. Section 149 of the Act speaks of judgment or award being obtained against any person insured by the policy and the liability of the insurer to pay to the person entitled to the benefit of the decree any sum not exceeding the sum 10/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 assured payable thereunder subject to any claim the insurer may have against the owner of the vehicle. Section 149 could not be understood as compelling an insurance company to make payment of amounts covered by decrees not only in respect of the number of persons covered by the policy itself but even in respect of those who are not covered by the policy and who have been loaded into the vehicle against the terms of the permit and against the terms of the condition of registration of the vehicle and in terms of violation of a statute.
14. It is true that the provisions in Chapter XI of the Act are intended for the benefit of third parties with a view to ensure that they receive the fruits of the awards obtained by them straightaway with an element of certainty and not to make them wait for a prolonged recovery proceeding as against the owner of the vehicle. But from that, it would not be possible to take the next step and find that the insurance company is bound to cover liabilities not covered by the contract of insurance itself. The Act only imposes an obligation to take out insurance to cover third party risks and in the case of stage carriages, the passengers to be carried in the vehicle and the passengers to be carried in the vehicle can be understood only as passengers authorized or permitted to be carried in the vehicle.
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15. In spite of the relevant provisions of the statute, insurance still remains a contract between the owner and the insurer and the parties are governed by the terms of their contract. The statute has made insurance obligatory in public interest and by way of social security and it has also provided that the insurer would be obliged to fulfil his obligations as imposed by the contract and as overseen by the statute notwithstanding any claim he may have against the other contracting party, the owner, and meet the claims of third parties subject to the exceptions provided in Section 149(2) of the Act. But that does not mean that an insurer is bound to pay amounts outside the contract of insurance itself or in respect of persons not covered by the contract at all. In other words, the insured is covered only to the extent of the passengers permitted to be insured or directed to be insured by the statute and actually covered by the contract. The High Court has considered only the aspect whether by overloading the vehicle, the owner had put the vehicle to a use not allowed by the permit under which the vehicle is used. This aspect is different from the aspect of determining the extent of the liability of the insurance company in respect of the passengers of a stage carriage insured in terms of Section 147(1)(b)(ii) of the Act. We are of the view that the insurance company can be made liable only in respect of the number of passengers for whom insurance 12/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 can be taken under the Act and for whom insurance has been taken as a fact and not in respect of the other passengers involved in the accident in a case of overloading.
16. Then arises the question, how to determine the compensation payable or how to quantify the compensation since there is no means of ascertaining who out of the overloaded passengers constitute the passengers covered by the insurance policy as permitted to be carried by the permit itself. As this Court has indicated, the purpose of the Act is to bring benefit to the third parties who are either injured or dead in an accident. It serves a social purpose. Keeping that in mind, we think that the practical and proper course would be to hold that the insurance company, in such a case, would be bound to cover the higher of the various awards and will be compelled to deposit the higher of the amounts of compensation awarded to the extent of the number of passengers covered by the insurance policy. Illustratively, we may put it like this. In the case on hand, 42 passengers were the permitted passengers and they are the ones who have been insured by the insurance company. 90 persons have either died or got injured in the accident. Awards have been passed for varied sums. The Tribunal should take into account, the higher of the 42 awards made, add them up and direct the insurance company to deposit that lump sum. Thus, the liability of the insurance 13/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 company would be to pay the compensation awarded to 42 out of the 90 passengers. It is to ensure that the maximum benefit is derived by the insurance taken for the passengers of the vehicle, that we hold that the 42 awards to be satisfied by the insurance company would be the 42 awards in the descending order starting from the highest of the awards. In other words, the higher of the 42 awards will be taken into account and it would be the sum total of those higher 42 awards that would be the amount that the insurance company would be liable to deposit. It will be for the Tribunal thereafter to direct distribution of the money so deposited by the insurance company proportionately to all the claimants, here all the 90, and leave all the claimants to recover the balance from the owner of the vehicle. In such cases, it will be necessary for the Tribunal, even at the initial stage, to make appropriate orders to ensure that the amount could be recovered from the owner by ordering attachment or by passing other restrictive orders against the owner so as to ensure the satisfaction in full of the awards that may be passed ultimately.
17. The seating capacity of the TATA Ace vehicle was two including the driver. Unfortunately, three persons traveled in the vehicle. In so far as the claims are concerned, the Insurance 14/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 company had already settled the claims of both the driver and the legal heirs of the deceased. Having settled those two claims, there is no question of fixing the liability as against the Insurance Company for the claim made in MCOP No.24 of 2010. If at all, the claimant in this case seeks for payment of any compensation, the same can be recovered only from respondents 1 and 2 in the claim petition, who are none other than the driver and the owner of the vehicle. As a consequence, the award passed by the Tribunal in MCOP No.94 of 2020 fixing the liability as against the Insurance Company is liable to be set aside.
18. In the result, CMA No.1515 of 2023 is allowed and the award dated 15.6.2022 in MCOP.No.94 of 2020 is set aside. CMA No.3080 of 223 is dismissed. No costs. Consequently, the connected CMP is closed.
05.04.2024 15/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 Index: Yes Internet:Yes Speaking order To The Motor Accident Claims Tribunal/ Special District Judge Court, Salem.
rka N.ANAND VENKATESH,J rka 16/17 https://www.mhc.tn.gov.in/judis C.M.A.Nos.1515 & 3080 of 2023 C.M.A.Nos.1515 & 3080/2023 and CMP No.15461 of 2023 05.04.2024 17/17 https://www.mhc.tn.gov.in/judis