Allahabad High Court
United India Insurance Company Ltd. ... vs Radheshayam And Ors. on 31 May, 2022
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH RESERVED A.F.R. Court No. - 24 Case :- FIRST APPEAL FROM ORDER No. - 34 of 2016 Appellant :- United India Insurance Company Ltd. Thru Manager Respondent :- Radheshayam And Ors. Counsel for Appellant :- Anchal Mishra Counsel for Respondent :- Amit Mishra,Ved Prakash Yadav CONNECTED WITH Case :- FIRST APPEAL FROM ORDER No. - 33 of 2016 Appellant :- United India Insurance Company Ltd. Thru Manager Respondent :- Radheshayam And Ors. Counsel for Appellant :- Anchal Mishra Counsel for Respondent :- Ved Prakash Yadav Hon'ble J.J. Munir,J.
1. This judgment will dispose of FAFO No.34 of 2016 and FAFO No.33 of 2016, both of which relate to the same motor accident and give rise to identical questions of facts and law. Both the appeals have, accordingly, been heard together. FAFO No.34 of 2016 shall be treated as the leading case.
2. In the leading appeal, the Insurance Company has challenged the judgment and award passed by the Motor Accident Claims Tribunal/ Additional District Judge, Court No.2, Sultanpur dated 13.10.2015, in MACP No.36 of 2014. By the award impugned, the Tribunal has held the claimant-respondents entitled to a compensation in the sum of Rs.3,54,000/- along with simple interest at the rate of 7% per annum from the date of institution of the claim petition until realization. The liability to pay the compensation has been fastened upon the United India Insurance Company Limited, who are the insurers of the offending vehicle. The Insurance Company have, therefore, appealed the impugned award primarily seeking to unshackle themselves of the liability to indemnify the owner under the insurance policy.
3. In the leading appeal, the deceased is Suresh Kumar @ Lallu, who died in the fatal accident. Compensation for his death in the motor accident is the subject matter of action. The claimants are his dependents.
4. In the connected appeal, the deceased is Smt. Dhanpatti Devi, mother of Suresh Kumar @ Lallu, who also met a fate the same as her son, Suresh Kumar in the same road accident. The claimants in this appeal are the dependents of the late Dhanpatti Devi wife of Radheyshyam. The Insurance Company, in this appeal too, say that they ought not to be saddled with the liability to indemnify in terms of the insurance policy.
5. In both the appeals, there were some other issues about the quantum of compensation also raised in the grounds, but at the hearing, the learned Counsel for the appellant-Insurance Company, Mr. Anchal Mishra has confined his submissions to the liability of the Insurance Company to satisfy the award.
6. The question on which the learned Counsel for the Insurance Company has addressed the Court is : Whether in view of the provisions of Section 103(1-A) of the Motor Vehicles Act, 1988 (for short, ''the Act') [as amended vide Uttar Pradesh Act 5 of 1993, sec. 2 (w.r.e.f. 16-1-1993)], the absence of a route permit authorizing a particular bus to ply on a specified route would discharge the insurer of his liability on a policy issued in favour of the owner, if the bus, placed at the disposal and under the control of a State Transport Undertaking on contract, plies on a route without such permit?
7. The facts giving rise to the leading appeal are:
On 22.10.2013 at about 11:40 a.m., Suresh Kumar @ Lallu was proceeding on a bicycle along with his mother, Smt. Dhanpatti Devi on the Varanasi-Lucknow State Highway, returning home after darshan at the Devi Mari Mai Dhaam. As the mother and son reached a place near the BDDV Mahila Maha Vidyalaya, Madanpur Paniar, a Volvo Bus, bearing Registration No. UP-32-CZ-0403, approached from the Jaunpur side. It was driven negligently and at a high speed. The bus hit the bicycle from the rear side. The accident resulted in Suresh Kumar @ Lallu's death on the spot. The claimant-respondents, who are dependents of Suresh Kumar @ Lallu, instituted the claim petition giving rise to this appeal, demanding a compensation in the sum of Rs.35,82,000/-. The claimants proceeded against the owner M/s. Logistics Private Limited under care of Santosh Kumar Jha, resident of Opposite Ambedkar Bus Stand, Alambagh, Lucknow. In addition, the driver of the bus, Vinay Kumar Sharma was also arrayed as a party.
8. The insurers of the vehicle, United India Insurance Company Limited through the Manager, Regional Office United Indian Insurance Company Limited, Second Floor, Kapoorthala Bagh Complex, Aliganj, Lucknow were also arrayed as a party.
9. The driver of the offending vehicle, who was opposite party no.1 to the claim petition, filed a separate written statement denying the accident. He, however, said that the vehicle was insured with the United India Insurance Company Limited. He was driving the vehicle under a valid and effective driving licence. The bus was working on contract under the control of the Uttar Pradesh State Road Transport Corporation (for short, ''the Corporation'). The Corporation ought to have been made a party. To like effect is the separate written statement, paper No. 13 ख filed on behalf of the owner.
10. The Insurance Company filed their own written statement, paper No. 10ख. They denied most of the claimants' case for want of knowledge. However, in their special pleas, it was stated that the claimants had not presented the necessary documents to hold the Insurance Company liable, such as the FIR, the charge-sheet, the site-plan, the postmortem report, the registration certificate, the road tax payment papers, the route permit and the insurance certificate.
11. According to the appellant-Insurance Company, the claim was barred by Section 149(2)(b) of the Act read with Section 64VB of the Insurance Act, 1938. The Insurance Company went to the extent of denying having insured the offending bus. It was also pleaded that the claim petition was barred by Section 158 of the Act.
12. Upon the pleadings of parties, the following issues were framed (translated into English from Hindi):
(1) Whether on 22.10.2013 at about 11:40 a.m. at the B.D.D.V. Mahila Maha Vidyalaya located within the limits of Village Madanpur Paniar, P.S. Lambhua, District Sultanpur, when the deceased Suresh Kumar @ Lallu along with his mother, Dhanpatti Devi, was cycling his way back after Darshan, Bus bearing Registration No. UP-32CZ-0403 proceeding from the Jaunpur side, driven negligently and at a high speed by its driver, who was intoxicated, hit the bicycle from the rear side, leading to Suresh Kumar @ Lallu's death on the spot and that of his mother, Dhanpatti Devi on 22.10.2013 at the District Hospital, Sultanpur?
(2) Whether the offending vehicle in question No. UP-32CZ-0403 had all valid papers, such as registration, insurance etc., that were effective, if yes, its effect?
(3) Whether the driver of the offending vehicle in question No. UP-32CZ-0403 had an effective and valid driving licence, if yes, its effect?
(4) Whether the petition is bad for non-joinder of necessary parties?
(5) Whether the claimants are entitled to any compensation, if yes, from whom and how much?
13. The claimants examined PW-1, Radheyshyam and PW-2, Ramesh Kumar in support of their case and by way of documentary evidence, produced through a list of documents a photostat copy of the FIR, postmortem report, inquest report, registration certificate, fitness certificate, driving licence, insurance certificate. In addition, through another list, paper No. 16ग, a copy of the FIR, a copy of the charge sheet, a copy of the site-plan, a copy of the postmortem report were filed. No oral evidence was led by any of the opposite parties to the claim petition, including the appellant-Insurance Company. The owner and the driver, however, filed documentary evidence, being the offending vehicle's registration certificate, fitness certificate, the driver Vinay Kumar's driving licence, the insurance certificate, the document regarding payment of tax, a copy of the contract with the State Road Transport Corporation and a copy of deed (of agreement) with the Corporation.
14. Heard Mr. Anchal Mishra, learned Counsel for the appellant-Insurance Company in support of this appeal and Mr. Ved Prakash Yadav, learned Counsel appearing on behalf of the claimant-respondents. No one appeared on behalf of respondent no.7, the owner.
15. In this appeal, the moot question involved is whether the appellant-Insurance Company are obliged to pay the awarded compensation in terms of the insurance policy, for the reason that no route permit has been produced, authorizing the owner or the Corporation operating the offending vehicle to ply the particular vehicle on the specified route. It is submitted by Mr. Anchal Mishra, learned Counsel for the appellant-Insurance Company that unless the particular vehicle, which is a private vehicle insured by the owner, has a valid route permit to operate on the route, where the accident occurred, the Insurance Company would not be liable to indemnify. In support of his contention, the learned Counsel for the appellant-Insurance Company has placed reliance on the decision of a Division Bench of this Court in F.A.F.O. No.937 of 2009, U.P.S.R.T.C. through Regional Manager, 6 Sapru Marg, Lucknow v. The Oriental Insurance Ltd. through Regional Manager, Regional Office, Balmiki Marg, Lalbagh, Lucknow, decided on 25.08.2010. The said case is related to a Corporation's Bus, about which it was contended that it was not proved by production of a valid route permit that the Bus had a permit to ply on the route where the accident occurred. On that ground, the Insurance Company had denied its liability to indemnify the Corporation. Relying on the provisions of Section 66 of the Act, it was held that the requirement of route permit to ply on a particular route was necessary, whether the owner of the transport vehicle was an individual or the State Transport Corporation. In U.P.S.R.T.C. v. Oriental Insurance Company Ltd. (supra), it was held:
"Further, " Motor Vehicle", "permit", "Public Service Vehicle" and Transport Vehicle are defined under Section 2 sub-section (28) (31) (35) and 47) of the Motor Vehicle Act 1988:-
"(28) "Motor Vehicle" or "Vehicle" means any mechanically propelled vehicle adapted for use upon road whether the power of propulsion is transmitted thereto from an external and internal source and includes a chassis to which a body has not been attached and a trailer; but does not include a vehicle running upon fixed rails or a vehicle of a special type adapted for use only in a factory or in any other enclosed premises or a vehicle having less than four wheels fitted with engine capacity of not exceeding[ twenty-five cubic centimeters];
(31) "permit" means a permit issued by a State or Regional Transport Authority or an authority prescribed in this behalf under this Act authorising the use of a motor vehicle as transport vehicle;
(35) "public service vehicle" means any motor vehicle used or adapted to be used for the carriage of passengers for hire or reward , and includes a maxicab, a motorcab, contract carriage , and stage carriage;
(47) "transport vehicle" means a public service vehicle, a goods carriage , an educational institution bus or a private service vehicle;"
Chapter V of the Act deals with control of transport vehicles and in the said chapter section 66 provides as under:-
"66. Necessity for permits. (1) No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him in use of the vehicle in that place in the manner in which the vehicle is being used."
Moreover in the said chapter Sections 70, 71 and 72 provides the procedure for application for stage carriage permit , procedure of Regional Transport Authority in considering application for stage carriage permit and grant of stage carriage permit respectively.
In view of the said provision as find place in Chapter V of the Act, legal position which emerges out that the vehicle which either owned by private individuals or by Corporation or by any authority can operate on a route in order to carry the passengers only when it holds a valid permit to use the said vehicle as a transport vehicle in public place subject to conditions as mentioned in sub section (3) of Section 66 of the Act."
Second submission as made by the learned counsel for the appellant that at the time of accident the bus was covered with valid documents i.e. permit, registration , insurance and even if it was not covered by the valid permit as per the practice and procedure adopted by the Corporation that vehicles are sent on the route on the basis of the permit issued to another vehicle as such the appellant is not liable to pay the compensation but the same is payable by insurance company is factually incorrect and wrong submission. In this regard issue no. 3 was framed by the Tribunal and while deciding the said issue finding of fact has been given by the Tribunal that at the time of accident, bus was covered by valid insurance policy but the same was operated without valid permit, so the insurance company was not liable to pay any compensation. Said findings given by the Tribunal are perfectly valid and in accordance with law as provided under section 66 of the Act, as stated above which specifically provides that transport vehicle can only operate on the route with a valid permit and in the present case , it is not disputed by the learned counsel for the appellant that bus in question at the time of accident was not covered by valid permit issued as per the provisions as provided under Sections 70,71, and 72 of the Act.
Further even otherwise while deciding the issue no. 3 , the Tribunal has also given a categorical finding that the Corporation/ appellant could not claim the benefit of the provisions of Section 103 of the Act because the mandatory provisions and the directions as provided under Section 101 and 102 of the Act has not been complied by the Corporation."
16. This Court may notice the principle that the owner of a commercial vehicle can place it through a contract at the disposal of the State Transport Corporation, who would then be regarded as its owner under Section 2(30) of the Act, entitled to operate the bus on any route under a permit issued to the Corporation, irrespective of the fact whether the particular vehicle had a permit for that route. The Corporation are entitled, by virtue of Section 103(1-A) of the Act [as amended vide Uttar Pradesh Act 5 of 1993, sec. 2 (w.r.e.f. 16-1-1993)], to ply one vehicle or the other owned by the State Transport Undertaking or a vehicle that is placed at their disposal by its owner under an arrangement entered into between such owner and the Corporation for the use of the said vehicle by the latter, on any route for which the Corporation holds a permit. The insurance policy would enure to the benefit of the person, who is lawfully plying the vehicle, which would include the Corporation as the term owner has been given an expanded meaning under Section 2(30) of the Act. It is not the law that each time a vehicle is placed at the disposal of another person, or for that matter the Corporation, a new policy has to be taken out. This point is settled in view of the decision of the Supreme Court in Uttar Pradesh State Road Transport Corporation v. Kulsum and others, (2011) 8 SCC 142.
17. But, the issue that Mr. Anchal Mishra has raised is not just about the insurance policy issued in favour of the owner, enuring to the benefit of the Corporation, when the vehicle was placed at the Corporation's disposal and the State undertaking were operating it, under their control, pursuant to an agreement for the purpose. The issue is whether a route permit for the offending vehicle, authorizing the Corporation to ply it on the route, where the accident occurred, was necessary to produce in order to fasten liability upon the Insurance Company. Broadly speaking, there is a difference between the liability of an Insurance Company to indemnify a commercial vehicle operating in a public place in that, that while a private operator of a commercial vehicle must hold a route permit for a specific vehicle operating on a specified route, under Section 66 of Chapter VI of the Act, the State Road Transport Corporation by virtue of Section 103(1-A) of the Act, as amended in its application in Uttar Pradesh, can operate any vehicle owned by them or placed at their disposal on a route for which they hold a route permit. The question was examined in a number of decisions of this Court. In F.A.F.O. No. 194 of 2011, The Oriental Insurance Co. Ltd. vs. Kripa Ram and ors., decided on 17.08.2017, it was held by Mahendra Dayal, J:
"10. The plain reading of Section 103 of the Act clearly reveals that the procedure for issuance of permit in favour of U.P. S.R.T.C., is contained in it. Once an independent provision for issuance of permit as stipulated in Chapter-VI of the Act has been made, no permit under Section 66 of the Act would be necessary.
11. A perusal of Section 103 (1A) also clearly reveals that the State Transport undertaking is required to take permit only in respect of a particular route. There is no requirement that the vehicle number should also find place in such permits. Once a motor vehicle is operated by U.P.S.R.T.C. it will, be fully covered under the provisions of Chapter-VI of the Act. There is no reason as to why the stipulation incorporated in the Insurance Policy may require satisfaction of permit issued under Section 66 of the Act.
12. It has also been submitted by the learned counsel for the respondent No. 3 that similar issue came for consideration before this Court several times and the controversy has been finally settled that the permit required for U.P.S.R.T.C. buses, does not require the registration number of the buses to be mentioned therein.
13. The learned counsel for the respondent No. 3 has referred to a judgment of the Division Bench of this Court rendered in FAFO No. 1090 of 2011, decided on 23.7.2015. In this case also similar question was raised and the Division Bench held that once the requirement for issuance of permit for notified route or notified area has been made, the argument of learned counsel for the appellant that bus number must be mentioned on the permit, cannot be accepted. It was also held that no such statutory requirement is contemplated either under the Act or under the Rules. A Co-ordinate Bench of this Court also had an occasion to examine this aspect of the matter in FAFO No. 462 of 2016 and FAFO No. 504 of 2014. In both the cases the Co-ordinate Bench came to the conclusion that Section 103 of the Motor Vehicles Act envisages the procedure of issuance of permit in favour of U.P.S.R.T.C. The Honb'le Single Judge, while deciding the appeals considered the matter in detail and found that once a motor vehicle operated by U.P.S.R.T.C. is covered under Chapter VI of the Act, no permit as provided under Section 66 of the Act is required. It was also considered by the Court that Rule 130 of the U.P. Motor Vehicle Rules 1998 prescribes the procedure for issuance of permit in favour of U.P.S.R.T.C. The prescribed form for obtaining permit is Form No. S.R. 46. This form also clearly mentions the issuance of permit under Section 103 of the Act. The other vehicles which are operated privately or issued permit in form S.R. 29 are regulated by Section 66 of the Act."
18. The question again fell for consideration before this Court in Oriental Insurance Co. Ltd., Barabanki v. Smt. Mithlesh and others, 2017 (4) ADJ 111 (LB). In Smt. Mithlesh (supra), it was held:
"11. A plain reading of the provisions extracted above, clearly shows that Section 98 gives an overriding effect to the provisions contained in Chapter VI of the Motor Vehicles Act, 1988. Section 103 sub-section (1) contains non-obstante clause, therefore, any provision contained in Chapter V inconsistent with the provisions of Chapter VI of the Act would have no application.
12. Insofar as the question of issuance of permit is concerned, Section 103 (1) of the Act clearly envisages the mechanism for issuance of permits in favour of UPSRTC. Once an independent provision for issuance of permits is stipulated under the statute, to say that for operating a vehicle by UPSRTC under Section 103(1A) of the Motor Vehicles Act, 1988, a permit under Section 66 of the Act would be necessary, in my humble consideration, such a proposition of law is misconceived and does not deserve acceptance. The rejection of contention is further strengthened when we look at the definition of owner as defined under Section 2(30) of the Act quoted hereinabove.
13. Section 103 was inserted by U.P. Act No. 5 of 1993 w.e.f. 17.1.1993 and is applicable insofar as the present case is concerned. Once a motor vehicle operated by UPSRTC is fully covered under the provisions of Chapter VI of the Act, there is no reason as to why the stipulation incorporated in the insurance policy may require satisfaction of permit issued under Section 66 of the Act for a vehicle covered under the provisions of Section 103 read with Section 103 (1A) of the Act.
14. There is yet another reason as to why meaning of stipulation in the insurance policy be not confined and interpreted within the ambit of Section 66. The stipulation itself provides for a permit issued under the provisions of Motor Vehicles Act, 1988. The condition in the insurance policy is wide enough to bring all the types of permits conceived under the Act within the cover of insurance policy, as such, the question raised by the appellant on the strength of Section 66 of the Act is without any legal foundation. The plea advanced by learned counsel for the appellant was also considered in the light of relevant Rules i.e. U.P. Motor Vehicle Rules, 1998. Rule 130 of the above Rules prescribes the procedure for issuance of permits in favour of UPSRTC in Form SR-46. Form SR-46 as is prescribed for the vehicles operated by UPSRTC clearly mentions the issuance of such a permit under Section 103 of the Act, whereas, the vehicles operated privately are to be issued a permit in Form SR-29 which is regulated under Section 66 of the Act. This is however, not to suggest that a privately operated vehicle may not have a permit under Section 66 of the Act. It may be fruitful to bear in mind that private operators first of all purchase a vehicle which is bound to have a permit and then comes operation of a vehicle on the notified route; but for a State Undertaking, a route under a scheme comes into existence first which follows by a permit and operation of vehicle in terms of permit comes last.
15. Once the prescribed statutory norms for the purposes of issuance of permit stand at variance, there is no reason as to why the permits issued under Chapter V and Chapter VI of the Act may not be treated to be satisfying the condition of insurance policy placed reliance upon. The two chapters being mutually exclusive provide for distinct permits which have to operate interdependently."
19. The same principle has been endorsed by this Court in Oriental Insurance Co. Ltd., Lko. v. Smt. Daya Devi and others, 2017 (4) ADJ 778 (LB), and again, in a much later decision in Oriental Insurance Co. Ltd., Lko. v. Smt. Saroj and others, 2021 (6) ADJ 346 (LB).
20. Here, the learned Counsel for the appellant-Insurance Company has attempted to raise the further issue that the Corporation were not impleaded as a party, though they were necessary parties, and on that account, the permit held by the Corporation for the route on which the offending vehicle was operated by them in terms of the contract between the owner and the Corporation could not be produced. It is further urged that if the Corporation were not impleaded, it was the duty of the owner to have placed on record the permit held by the Corporation to ply on the route, where the accident occurred.
21. It must be recorded that there is no plea raised on behalf of the appellant-Insurance Company in their written statement about non-joinder of the Corporation as a necessary party to the proceeding. The plea was raised on behalf of the Owner and the Driver and Issue No. 4 about non-joinder of the Corporation as a necessary party was framed at their instance. However, at the hearing, the said issue was not pressed and none of the opposite parties to the claim petition, including the appellant-Insurance Company, pressed for a decision on the said issue. Thus, so far as non-impleadment of the Corporation is concerned, it does not appear to be a case which the Insurance Company are entitled to agitate now. So far as the fundamental plea that the Corporation's permit for the route, in any case, was required to be brought on record, if not by the non-party Corporation, by the claimants, who seek compensation, it must be remarked that the Corporation are an establishment of the State, wholly owned and controlled by it. There is a presumption of fact-quite rebuttable about regularity attached to all official actions, a principle embodied under clause (e) of Section 114 of the Evidence Act, 1872. The provisions of Section 114(e) of the Evidence Act are based on a salutary principle, and assuming that the Evidence Act does not apply proprio vigore to proceedings before the Motor Accident Claims Tribunal, the principle there based on time-tested wisdom does certainly apply. There is no reason why the Corporation would ply a vehicle of theirs on a route, where they do not hold permit. A copy of the agreement between the authorized signatory on behalf of the owner and the Regional Manager of the Corporation for the Lucknow Region is on record as paper No. 15ग. A perusal of Clause 29 of the said agreement, where the owner has been described as the second party and the State Road Transport Corporation as the first party, reads:
"Permit of the undertaking Bus will be in the name of First Party and the fees spent to obtain the permit will be borne by the First Party."
22. The offending vehicle was being operated by the Corporation in terms of the agreement dated 25.10.2000, which carries a covenant that the Corporation would operate on the basis of a permit taken out by them and the expenses whereof the Corporation would bear. Bearing in mind the principle about regularity in official actions, it has to be presumed that the Corporation were operating on a route for which they held a permit. The provisions of sub-Section (1-A) of Section 103 show that the Corporation do not require a permit for every vehicle that they operate with its number mentioned on the permit. They can detail any vehicle on any route of theirs, including a vehicle that has been leased out to them or which they operate under an agreement from its owner. The presumption, therefore, that arises clearly is that the offending vehicle was being operated on a route for which the Corporation held a permit. The accident occurred on that route. It was for the appellant-Insurance Company, under the circumstances, to prove by affirmative evidence, that the Corporation did not have a permit to operate on the route where the accident occurred. The presumption about regularity in official actions is rebuttable, and this presumption too could be rebutted. But, it was not. The appellant-Insurance Company did not lead any evidence, whatsoever, to show that on the date of accident on the route, the offending vehicle was plying, the Corporation did not hold a valid permit to operate.
23. In the circumstances, there is no force whatsoever in the contention that the appellant-Insurance Company raise in this appeal. No other point was pressed.
In re. : FAFO No. 33 of 201624. This appeal is again by the Insurance Company and arises out of the claim relating to the death of Smt. Dhanpatti Devi, the other victim of the accident, who was riding the bicycle along with her son, Suresh Kumar @ Lallu on 22.10.2013. The other details and issues need not be gone into as the relevant facts and the issue, on the basis of which the award here has been sought to be impeached, are the same as those involved in the leading appeal. No additional point has been pressed in this appeal by Mr. Anchal Mishra, learned Counsel for the appellant-Insurance Company.
25. In the result, both the appeals fail and are dismissed with costs throughout. The interim orders passed are hereby vacated.
Order Date :- 31.05.2022 Anoop (J.J. Munir, J.) **********