Madras High Court
The Divisional Manager vs Chinnammal on 8 March, 2011
Author: T. Mathivanan
Bench: T. Mathivanan
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 08/03/2011 CORAM THE HONOURABLE MR.JUSTICE T. MATHIVANAN CMA.(MD).No.310 of 2009
1.The Divisional Manager National Insurance Company Ltd., 938, Sathy Road, Gandhinagar Coimbatore. ... Appellant Vs.
1.Chinnammal W/o. Late Gurusamy
2.Chinnasamy ... Respondents Prayer Appeal is filed under Section 30 of the Workmen's Compensation Act 1923, against the award passed in W.C.No.73 of 2006 dated 29.10.2008 on the file of the Learned Commissioner of Workmen Compensation cum Deputy Commissioner of Labour, Thirunelveli !For Appellant ... Mr.D.Sivaraman ^For Respondents ... Mr.V.Minnavadi For R1.
:Judgment This civil miscellaneous appeal is directed against the award dated 29.10.2008 and made in W.C.No.73 of 2006 on the file of the Learned Commissioner of Workmen Compensation cum Deputy Commissioner of Labour, Thirunelveli, by the second respondent Insurance Company therein.
2. The facts which giving rise to the memorandum of Civil Miscellaneous Appeal are as under;
3. The deceased Natrajan was employed as a driver under the second respondent/first respondent. That on 10.03.2004 at about 1.30 pm., a lorry bearing registration No.TCG 1661, had rammed against the Minidor bearing registration No.TN 38 J 3462 which was driven by the deceased Natrajan near S.P.Exports Company, Nilampur at Avinashi Road when he was proceeding to Muthugoundanpudur for supplying vegetables to RLM canteen and as a result of which he had succumbed to the injuries instantaneously on the spot. Hence, the first respondent herein, and her husband one Gurusamy (since deceased) being the parents of the deceased Natrajan had filed a claim petition in W.C.No.33 of 2006 on the file of the Commissioner of Workmen's Compensation -II, Chennai claiming a sum of Rs.4,39,000/-. During the pendency of the claim petition the first claimant being the husband of second claimant had died in a road traffic accident. Hence, on the application made by the second claimant, the claim petition was transferred to the file of the Workmen's Compensation Commissioner cum Deputy Commissioner of Labour Thirunelveli. The second respondent herein, who is the owner of the vehicle as well as the employer of the deceased Natrajan had not contested the claim petition. On the other hand, the appellant being the second respondent/Insurance Company had resisted the claim petition on the following grounds;
1.There was no relationship of employer and employee between the deceased and the second respondent/first respondent.
2.The deceased being the driver of the minidor bearing registration No.TN 38 J 3462 was not having valid and effective driving license to drive the particular type of vehicle at the time of accident.
4. In order to establish their respective cases the parties to the claim petition went for trial. The first respondent/second claimant Tmt. Chinnammal, had examined herself as PW 1 and during the course of her examination Exs.P1 to P3 were marked. On the other hand one Thiru Shankaran Senior Assistant of the appellant insurance company was examined as RW 1, and during the course of his examination Ex.R1 and R2 were marked.
5. On appraising the evidences both oral and documentary the learned Workmen's Compensation Commissioner cum Deputy Commissioner of Labour, Thirunelveli had passed an award of Rs.3,21,865/- after rejecting the contention of the appellant insurance company, and the appellant insurance company was also directed to pay this amount to the first respondent/second claimant within 30 days, failing which the award shall carry interest at the rate of 12% per annum from the date of petition i.e., 05.07.2004 till the date of realisation.
6. Being aggrieved by the award passed by the Workmen's Compensation Commissioner cum Deputy Commissioner of Labour, Thirunelveli, the appellant insurance company has approached this Court by way of this appeal.
7. When the appeal came up for admission the following substantial questions of law were formulated;
1.Whether the Deputy Commissioner of Labour is correct in holding that the defences available to the Insurer under Section 149(2) of the Motor Vehicles Act, 1988 cannot be raised in a proceeding under Workmen's Compensation Act, 1923 ?
2.Whether the Learned Workmen's Compensation Commissioner-cum-Deputy Commissioner of Labour, Dindigul is correct in directing the appellants/Insurance Company to pay interest on the award, from the date of the accident, which is in contradiction to Section 4-A(3) of the Workmen's Compensation Act ?
8. Heard both sides.
9. The relationship of employer and employee, between the second respondent herein being the owner and the deceased being the driver of the vehicle, has not been disputed. The quantum of compensation has also not been disputed by the appellant Insurance Company. As chalked out in the substantial questions of law, the learned counsel Mr.D.Sivaraman, appearing for the appellant Insurance Company has vehemently objected the finding of the Learned Workmen's Compensation Commissioner that the appellant Insurance Company is not entitled to avail the defence under Section 149(2) of the Motor Vehicles Act, 1988 in the proceedings under Workmen's Compensation Act. The second contention pertaining to the second substantial question of law is that the direction of the Learned Workmen's Compensation Commissioner to the appellant Insurance Company to pay interest from the date of accident is in total negation of the principle laid down in Section 4-A(3) of the Workmen's Compensation Act. These two substantial questions of law are the rail on which the discussion of the whole appeal should travel.
10. Before we go into the merits of the appeal, this Court has thought it fit that it may be better to refer the proviso to Section 149(2)(a)(ii) of Motor Vehicles Act.
"Section 149(2)- No sum shall be payable by an insurer under sub-section (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given the insurer had notice through the Court or, as the case may be, the Claims Tribunal of the bringing of proceedings, or in respect of such judgment or award so long as execution is stayed thereon pending an appeal; and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely:-
(a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:-
(ii) a condition excluding driving by an named person or persons or by any person who is not duly licensed, or by any person who has been disqualified for holding or obtaining a driving license during the period of disqualification."
11. Now the question is as to whether the defence available to the insurer under Sub Clause (a)(ii) to Sub Section 2 to Section 149 of Motor Vehicles Act 1988 cannot be availed by it in the proceedings under Workmen's Compensation Act 1923, particularly in an appeal under Section 30(1) of the Workmen's Compensation Act 1923.
12. It is pertinent to note here that in the term "The Workmen's Compensation", the word "Workmen's" has been substituted by Act 45 of 2009, Section 5 with effect from 18.01.2010 vide S.O.No.101(E) dated 18.01.2010 and now as amended by Act No.45 of 2009 with effect from 18.01.2010, the Act is called as The Employees' Compensation Act 1923. Section 19 of The Employees' Compensation Act 1923 (Workmen's Compensation Act 1923) reads as follows;
"Section 19 - Reference to Commissioners -
(1) If any question arises in any proceedings under this Act as to the liability of any person to pay compensation (including any question as to whether a person injured as or is not [an employee]) or as to amount or duration of compensation (including any question as to the nature or extent of disablement), the question shall, in default of agreement, be settled by [a Commissioner]."
13. On coming to the instant case on hand, even before the Commissioner for Workmen's Compensation, a defence was taken up by the appellant/Insurance Company that the deceased being the driver of the second respondent herein was not having valid and effective driving license at the time of accident and hence as contemplated under Section 149(2)(a)(ii), the insurer is not at all liable to indemnify the owner of the vehicle as he had violated the policy conditions to that effect. It is manifest from the materials available on record that the driving license of the deceased was not produced before the Learned Commissioner for Workmen's Compensation, either by the appellant/Insurance Company or by the first respondent/claimant. The appellant/Insurance Company had sent a notice dated 27.02.2008, to the owner of the vehicle, who is the respondent herein to disclose the details of the driving license of the deceased driver. This notice had got no response from the owner of the vehicle. As discussed in the earlier paragraph, it was contended before the Learned Commissioner for Workmen's Compensation, that since the deceased driver was not having valid and effective driving license, the appellant/Insurance Company, could not mulet with the liability of paying compensation.
14. In support of his contention a decision in United India Insurance Co.Ltd., v. Noora reported in 2007 ACJ 64 was made reference. In this case the scope and application of Section 149(2)(a)(ii) have been discussed elaborately. The driver met with fatal accident. The employer had admitted the employment of the workman and his death in accident during the course of his employment. The Insurance company has disputed its disability on the ground that the deceased had no valid driving license to drive the vehicle. In this circumstance, a question was arisen as to whether the Insurance Company is exempted from liability. By way of answer to this question, it was held by the High Court of Jammu and Kashmir that the provisions of Workmen's Compensation Act do not prescribe that if a driver is employed, he should possess a valid license. This finding was given after following the decision reported in 1999 ACJ 236 (Karnataka). Only on the footing of the above cited decision, the Learned Commissioner for Workmen's Compensation has come to the conclusion that the appellant Insurance Company is liable to pay compensation as the Workmen's Compensation Act does not prescribe that if driver is employed, he should possess a valid license.
15. Apart from this at the time of arguments another decision in New India Assurance Co.Ltd., vs. C.B.Shankar and others reported in 1986 Acj 82 was also made reference. In this case the driver was charged for driving a motor vehicle without holding effective driving license and the owner was also charged for contravention of the provisions for permitting the driver who was not holding license to drive. Both the driver as well as the owner of the vehicle had pleaded guilty before the Magistrate concerned and were convicted. On this background, a question was arisen in an appeal before the Division Bench of this Court as to whether the Insurance Company is liable to pay compensation. The Hon'ble Division Bench of this Court headed by V.Ramaswami,J has held that;
"in order to escape the liability the insurance company is not only required to prove that the driver was not holding license at the time of accident but also to prove that the driver was disqualified from holding or obtaining a license or never had any license at all."
16. In this connection, the learned counsel for the appellant has contended that the insurance policy itself was issued as per Section 147 and 149 of the Motor Vehicles Act, which have also been placed in Chapter 11 of the said Act, and therefore, the benefit is claimed under the policy which was issued as per Section 147 of the Motor Vehicles Act. The insurer is at liberty to take the defences available under Section 149(2) of the Motor Vehicles Act. He has also contended that the appellant/Insurance Company is not precluded from taking the defences available under Section 149(2) of the Motor Vehicles Act in a proceeding under the Employees'(Workmen's) Compensation Act 1923. He has also raised another question that if Chapter 11 of the Motor Vehicles Act 1988, is not made applicable to a proceeding under Employees'(Workmen's) compensation Act, 1923 how the claim petition claiming benefit under the Insurance policy issued by the mandate of the provision of Chapter 11 i.e., under Section 147 of Motor Vehicles Act can be entertained by the Deputy Commissioner of Labour ?
17. In this regard, this Court is of view that for better appreciation of this case, Section 167 of Motor Vehicles Act 1988 can also be extracted here. Section 167 of Motor Vehicles Act 1988 reads as follows;
"Section 167. - Option regarding claims for compensation in certain cases - Notwithstanding anything contained in the Workmen's Compensation Act, 1923 (8 of 1923) where the death of, or bodily injury to, any person gives rise to a claim for compensation under this Act and also under the Workmen's Compensation Act, 1923, the person entitled to compensation may without prejudice to the provisions of Chapter X claim such compensation under either of those Acts but not under both."
18. From the proviso to Section 167, it is made clear that the injured or the legal representatives of the victim of an accident happens to claim compensation under Motor Vehicles Act can claim compensation either under the Motor Vehicle Act or under the Employees (Workmen) Compensation Act as the case may be but not under both Acts.
19. The learned counsel for the appellant/Insurance company while advancing his arguments has also placed reliance upon the following decisions;
1.Kavitha Dilip Patil and others vs. Ananda Gnanu Patil and another reported in 2004 ACJ 1000.
2.National Insurance Company Ltd., Bhavani v. Samiyathal & Others reported in 2004 (1) TN MAC (DB) 455.
3.K.Venkatanarayanan v. Balaji and others reported in 2002 ACJ 1063
20. In the first decision i.e., Kavitha Dilip Patil and others vs. Ananda Gnanu Patil and another reported in 2004 ACJ 1000, the following two different questions were referred to, the Full Bench of Hon'ble Karnataka High Court as per the order passed by the Hon'ble the Chief Justice.
1.Whether the restrictions on the defences available to an insurance company in terms of Section 149(2) of the Motor Vehicles Act have any application to the proceedings under the Workmen's Compensation Act ?
2.Whether in an appeal against the award of the Commissioner for Workmen's Compensation, the insurance company can challenge the award on any ground other than what is available to them under the provisions of Motor Vehicles Act ?
21. These two questions were answered in the negative form by the Hon'ble Full Bench of the Karnataka High Court. After referring to Section 167 and 149 of the Motor Vehicles Act 1988 and the proviso to Section 30 of Workmen's Compensation Act 1923, the Hon'ble Full Bench of Karnataka High Court has held that;
"14. From a reading of the above provisions, it is clear that the object of both the Acts, viz., the MV Act and the WC Act is to provide compensation to the victims of accidents. The only difference between the two enactments is that so far as the WC Act is concerned, it is confined to workmen as defined under the Act while the relief provided under Chapters X to XII of the MV Act is available to all the victims of accidents involving a motor vehicle. This conclusion is supported by section 167 of the MV Act, under which, it is open to the claimants either to proceed to claim compensation under the WC Act or under the MV Act. A perusal of the objects of the two enactments clearly establishes that both enactments are beneficial enactments operating in the same field. It is seen that the WC Act does not make any provision either for payment of the claim by the insurance company or for the addition of the insurance company as a party to the proceedings before the Commissioner. The question of proving the negligence does not arise under the WC Act, whereas under the MV Act negligence and quantum are to be proved. So far as it relates to the interpretation of the word 'death' in the WC Act, it is certainly applicable to the interpretation of the word 'death' in the MV Act also, which is also clear from the decision in the case of Rita Devi v. New India Assurance Co.Ltd., 2000 ACJ 801 (SC)."
22. In paragraph 15, it is held that;
"It is seen that if the employer of a workman has insured his workman with the insurance company and if the workman sustains bodily injury or death occurs in an accident arising in the course of the employment, the workman is entitled for compensation as per the limit and the insurance company has only to indemnify the employer for the amount. More so, there is no privity of contract between the workman and the Insurance Company. Therefore, the question of raising defence now does not arise for the Insurance Company against the claim of workman, that too in the absence of the employer being made a party. The circumstances under which the Insurance Company would be made as a party in a proceeding before the Motor Accidents Claims Tribunal or before the Workmen's Compensation Commissioner and the scope of defence that is available to the Insurance Company so impleaded had come up for consideration before the Supreme Court even in later cases are well settled. Otherwise also, the appeal filed under Section 30 of W.C. Act is maintainable only on substantial questions of law. Under the circumstances, under W.C. Act, the Insurance Company can only agitate violation of any condition of the policy to make substantial question of law, and therefore, the question of raising other defences available in terms of Section 149(2) of M.V. Act does not arise."
23. When referring the decision of the Division Bench in New India Assurance Co.Ltd., v. Raja Naika, 1992 ACJ 521 (Karnataka), the Full Bench has held in paragraph No.17 that "The Division Bench of this Court in the above case has in fact created a right in the insurance company to take up such defences which are available to them in law under Section 149 of the MV Act even though there is no such provision in the WC Act itself. It is because of that judgment the right of the insurance company to take up such defence is recognised. Otherwise, the insurance company had no such defence at all in a proceedings under the provisions of the WC Act. As held by the Supreme Court when the statute is silent we cannot add a provision to the Act which is not enacted or add words to a statute where the legislature has consciously avoided certain words."
24. Further after referring the decisions of the Supreme Court in National Insurance Co.Ltd., v. Nicolletta Rohtagi reported in 2002 ACJ 1950(SC)the Full Bench has held that;
"After the insurer has been made a party to a case or claim, it is clear from the plain, simple and unambiguous language of Section 149(2) read with provisions of Section 149(7) that insurer is permitted to contest the claim only on the ground mentioned in Section 149(2) of M.V. Act 1988 corresponding to Section 96 of M.V. Act 1988 and the Insurance Company cannot avoid its liability on any other grounds except those mentioned in the said sub-section and further observed that right to file an appeal is a statutory right and in view of the provisions of Section 149(2) of Motor Vehicles Act it cannot extend beyond the defences available under Section 149(2) and challenge in an appeal would confine only to those grounds."
25. It is further held in paragraph No.18 that;
"Under the provisions of the Workmen's Compensation Act a statutory appeal is provided under Section 30 of the Act to the High Court on the orders enumerated therein. The proviso to that Section makes it very clear that no appeal shall lie against any order unless a substantial question of law is involved in the appeal. As stated earlier negligence or contributory negligence of the offending vehicle is not a ground to be considered at all while awarding compensation under the Workmen's Compensation Act. Therefore, the insurer cannot prefer any appeal either challenging the quantum of compensation or on any other grounds except the ground available to him under Section 149(2) of 1988 Act. When under the Compensation Act the insurer has no right to take any defence disputing the claim of the claimants and his defence is only confined to avoid the liability under the insurance policy as contemplated under Section 149(2) of the Act and when the appeal is confined to substantial question of law under the Act, it cannot be said that the right of appeal of an insurance company against the award under the Workmen's Compensation Act is broader than that right which is conferred on them under the Motor Vehicles Act. In fact, it would be narrower than what is provided to them under the Motor Vehicles Act as under the Workmen's Compensation Act, the appeal is only against a substantial question of law."
26. For the two questions which were referred, the Hon'ble Full Bench of Karnataka High Court, has answered as follows;
"(a) The Insurance Company cannot take up defences other than what is available to them under the terms of the insurance policy and which are specified in Section 149(2) of the Motor Vehicles Act even in proceedings under the provisions of the Workmen's Compensation Act.
(b)As under Section 30 of the Workmen's Compensation Act an appeal lies only against a substantial question of law, the Insurance company cannot urge any other ground other than what is available to them under the provisions of the Motor Vehicles Act and even in respect of those grounds unless a substantial question of law is made out."
27. In National Insurance Company Ltd., Bhavani vs. Samiyathal & Others reported in 2004 (1) TN MAC (DB) 455. It is held by a Division Bench of this Court (High Court of Madras) that the Insurance Company to substantiate plea by necessary material that driver had no valid driving license on the date of accident. The Insurance Company sent notice under Ex.R2 driver to produce his driving license but the same returned unserved and the returned envelope was marked as Ex.R3. The Insurer then sent a notice Ex.R4 to the owner of the vehicle informing him about non-production of driving license by driver and violation of M.V.Act and policy conditions, but the same returned as refused. The returned envelope was marked as Ex.R5. Admittedly, the insurer had not taken steps to ascertain from RTO whether the lorry driver was issued with a driving license. Under this background, the Division Bench of this Court has held that the materials would show that the insurance company had taken steps to ascertain the fact whether the driver had a valid driving license or not.
28. It is also held that there was no explanation as to why the driver and the owner did not respond to the notice issued by the Insurance Company. Under this circumstance it was held that the Insurance Company had discharged initial responsibility in proving the fact that the driver of the vehicle had no valid license, and the said fact had not been discharged either by claimants or by owner of the vehicle.
29. The learned counsel for the appellant has also in order to support his contention, placed reliance upon an another decision in K.Venkatanarayanan v. Balaji and others reported in 2002 ACJ 1063. In this case K.P.Sivasubramaniam, J has held in paragraph No.8 that;
"The insurance company has done what is best in the circumstances by examining the staff from the local Regional Transport Office and also by filing Exh. P-1 license, which does not contain any endorsement for driving two-wheeler. To require the insurance company to obtain the evidence from all the transport offices, throughout the State or the country is impracticable and unreasonable. Therefore, I am inclined to hold that the insurance company had established that the rider of the vehicle which is insured with the respondent No. 2, did not have a valid license."
30. On coming to the instant case on hand it is pertinent to note here that one of the substantial questions of law raised in this appeal is as to whether the defences available to the insurer under Section 149(2)(a)(ii) of the Motor Vehicles Act 1988 can be raised in a proceedings under the Workmen's Compensations Act 1923. In so far as the above cited two decisions are concerned, this Court does not think that they would give proper answer to the substantial question of law number one.
31. On the other hand the learned counsel for the first respondent has contended that the conclusion of the Learned Commissioner for Workmen's Compensation is absolutely based on the Workmen's Compensation Act and that it need not be interfered with. He would further submit that in a proceeding like that of the present case on hand the insurer is not entitled to avail the defence under Section 149(2)(a)(ii) of M.V.Act. He has also added that the appeal itself is not maintainable as no substantial question of law is involved as contemplated under Section 30 of the Workmen's Compensation Act. He has also added that since the driver had succumbed to injuries during the course of his employment under the owner of the vehicle involved in the accident, the insurance company is liable to pay the amount of compensation as directed by the Learned Commissioner of the Workmen's Compensation, since the deceased driver was under the coverage of the Insurance Policy.
32. In order to substantiate his argument the learned counsel for the first respondent has placed reliance on the decision in National Insurance Co.Ltd., vs. Venkatan and another reported in 2009 ACJ 1787. In this case the cleaner of a van had sustained injuries in the course of employment when the vehicle was capsized. His left elbow was amputated and he suffered the loss of earning capacity to the extent of 70%. The insurance policy covered risk of workmen on payment of additional premium and therefore, the Commissioner had allowed the compensation as per statutory calculation against the insurance company. Challenging the award of the Commissioner the insurance company had made an appeal seeking exemption from liability on the ground that the driver of the van had no valid license. Under this circumstance the Division Bench of this Court has held that no substantial question of law is involved and therefore, the appeal preferred by the insurance company is not maintainable.
33. On coming to the present case on hand the relationship of employer and an employee between the owner of the vehicle and driver has not been disputed. It is not the case of the appellant insurance company that the driver is not covered under the policy which was marked as Ex.P2 (R2). Appreciating the evidence of PW 1 and RW 1 and the documentary evidence under P1 to P3 and R1 to R3, the learned Commissioner for the Workmen's Compensation has found that since the relationship between the employer and employee i.e., the owner of the vehicle and driver has not been disputed and the driver is covered under the policy of insurance, the insurance company who is the appellant herein is liable to pay the compensation. When such being the case as rightly observed by the Division Bench of this Court no substantial question of law is involved in this case.
34. The learned counsel for the respondent has also contended that though the insurance company had issued notice to the owner of the vehicle to disclose the details of the driving license of the driver, it has not taken any steps to summon the record from the RTO to prove that the driver had no valid driving license at the time of accident. In support of his argument the learned counsel has placed reliance upon the decision in National Insurance Co. Ltd., v. A.Babu and others reported in 1990 ACJ 1003.
35. The learned counsel has also submitted that the plea of non production of driving license cannot be a valid ground to absolve the liability of the Insurance company. In United India Insurance Co. Ltd. v. Annakutty and another reported in 2006 ACJ 40. The Kerala High Court has held that the absence of driving license of the deceased cannot be taken as a reason to deny compensation to the dependants of the workman.
36. This Court has carefully analysed the evidences both oral and documentary available on record and considered the submissions made on behalf of both sides. This Court has also gone through the decisions cited by both sides. Keeping in view of all the related facts and circumstances this Court is of considered view that the conclusion of the Learned Workmen's Compensation Commissioner is unassailable and may be endorsed, as the deceased was not disqualified for holding or obtaining a driving license. The appellant insurance company has also failed to prove that the deceased was disqualified from holding or obtaining a driving license or never had any license at all.
37. In the result the appeal is dismissed. The award dated 29.10.2008 and made in W.C.No.73 of 2006 on the file of the Learned Commissioner of Workmen's Compensation cum Deputy Commissioner of Labour, Thirunelveli is confirmed. No order as to cost.
prm To,
1.The Divisional Manager National Insurance Company Ltd., 938, Sathy Road, Gandhinagar Coimbatore.
2.Commissioner of Workmen Compensation cum Deputy Commissioner of Labour, Thirunelveli