Madras High Court
Oriental Insurance Co. Ltd. vs Jalaja And Ors. on 20 October, 1994
Equivalent citations: 1995ACJ829
Author: M. Srinivasan
Bench: M. Srinivasan
JUDGMENT M. Srinivasan, J.
1. The insurance company is the appellant. The only question raised by the company is that the liability of the company is limited to Rs. 1,50,000/-. The total award is for Rs. 2,50,000/- with interest. The company contended before the Tribunal that according to the policy, the liability is limited to meet the requirements of the Motor Vehicles Act, 1939. It was argued that under the Act as it stood at the time of accident, the maximum liability of the insurance company was only Rs. 1,50,000/- for third party risk. The insurance company also produced a true copy of the policy which was marked as Exh. B-l. An employee of the company in the rank of Assistant has produced the document and given evidence in support of it. The document was signed by the Branch Manager as true copy.
2. The Tribunal has chosen to reject the document and also the contention of the insurance company on the footing that the original policy has not been produced. The Tribunal has observed that the insurance company ought to have taken steps to summon the original policy from the owner of the vehicle and having failed to do so, it is not open to the company to contend that the liability is limited. The Tribunal has placed reliance on the judgment of a single Judge of Rajasthan High Court in National Insurance Co. Ltd. v. Chandra Bhaga (1991) 2 TAG 78. Consequently, the Tribunal held the insurance company to be liable for the entire compensation amount along with the owner of the vehicle.
3. We are unable to accept the view taken by the learned Tribunal. There is no presumption that the insurance company fabricated the document in order to restrict its liability. There is also no material on record to suspect the genuineness of Exh. B-l. It has been produced by an official of the company and it was signed as true copy by the Branch Manager. The policy contains all the relevant particulars as regards limits of liability. The relevant portion reads thus:
Limit of the amount of the company's liability under Section II-1 (i) in respect of any one of the accident: such amount as is necessary to meet the requirements of the Motor Vehicles Act, 1939.
In the cross-examination, the suggestion made to RW 1 was that the document was fabricated for the purpose of the present case. That suggestion had been denied by him. He has been asked as to why the proposal form has not been filed. He is not able to give the reason for non-production of the proposal form. However, he has denied the suggestion that if the proposal form is produced, it will show that the liability is unlimited. RW 1 has given evidence that the company has written six letters to the owner to produce the original policy. But the letters have not been produced before the court. No doubt, the company has not taken any steps to issue summons to the owner to produce the original policy, but that cannot lead to an adverse inference against the company.
4. An insurance company which is carrying on business of insurance is not expected to fabricate documents. Unless some material is produced before the court to suspect the bona fides of the insurance company, the court cannot readily draw an inference that the copy of the policy produced by it as a true copy is not a genuine one, particularly when the provision in the Act of 1939 was that the maximum liability of the insurance company with regard to third party risk was Rs. 1,50,000/-. The policy does not mention any specific amount. The limitation clause merely refers to the Act and says that such amount as is necessary to meet the requirements of the Act. When that is the relevant clause, we have no doubt whatever about the genuineness of the copy of the policy produced by the company. This is the general form used by the company in the case of all persons who take insurance. It is not the suggestion of the claimants that the form itself is fabricated for the purpose of this case. The limitation clause is in printed portion of the form. It is not as if it is handwritten or typewritten. In these circumstances, we differ from the view taken by the Tribunal and hold that Exh. B-l is a true copy of the policy. It has been held in New India Assurance Co. Ltd. v. K. Chandra 1991 ACJ 386 (Madras), that under Section 95 (2) (b) of the Act, the insurance company is not liable to pay anything more than the amount limited by the statute unless the policy contains a different provision. We agree with the view taken by the Bench and hold in this case that the statutory liability at Rs. 1,50,000/- is applicable and consequently the insurance company is liable to pay only Rs. 1,50,000/- out of the award amount.
5. Learned counsel for the claimants had placed reliance on the judgment in National Insurance Co. Ltd. v. Chandra Bhaga (1991) 2 TAG 78. A single Judge of the Rajasthan High Court has held that the entire onus was on the insurance company to prove that the liability was limited. As it had not produced the original policy or taken steps to summon the same from the owner of the vehicle, the company had not discharged its onus. We are unable to accept the reasoning adopted by the Rajasthan High Court. The owner of the vehicle will not certainly be interested in producing the policy which contains a limitation of the liability of the insurance company. If, as contended by the claimants, the policy did not contain a limitation, the owner of the vehicle would readily have produced the policy before the court as it would have helped him to mulct the entire liability on the insurance company and escape from paying any amount under the award. Hence, the non-production of the original policy by the owner can only lead to an adverse inference against the owner of the vehicle and not against the insurance company. The claimants could have well taken summons to the owner of the vehicle to produce the original policy. These aspects of the matter were not taken note of by the learned single Judge of the Rajasthan High Court. Hence, we are unable to accept the correctness of the view expressed therein.
6. In the result, we allow the appeal and hold that the appellant company is liable only to the extent of Rs. 1,50,000/- out of the total compensation awarded by the Tribunal. It goes without saying that the claimants are entitled to recover the remaining amount under the award from the other respondents in the original petition, viz., respondent Nos. 1 and 2 therein, V.T. Singaravel and Ramasami. We are not disturbing the award in any other manner. The appeal is allowed to the extent indicated above. There will be no order as to costs.