Madhya Pradesh High Court
National Insurance Co. Ltd. vs Ravishankar And Ors. on 10 May, 1995
Equivalent citations: 2(1997)ACC548
Author: R.S. Garg
Bench: R.S. Garg
JUDGMENT R.S. Garg, J.
1. The appellant Insurance Company being aggrieved by the order dated 5.9.1990, passed in Claim Case No. 51 of 1990, by the learned ,, Additional Member, Motor Accident Claims Tribunal, Kami, has filed the present appeal. Brief facts leading to tine present case are that the claimant Ravishankar, on 13.5.1990, while riding a cycle was hit by the non-applicant No. 1, when he was driving a scooter No. ATS 4014. As a result of the accident, respondent No. 1 suffered grievous injury, including a compound fracture. According to the claimant, non-applicant No. 2, Dashrath Prasad, was the owner of the vehicle and the vehicle was insured with the appellant Insurance Company. The claimant, on these facts, filed a claim petition and also moved an application Under Section 140 of the Motor Vehicles Act. It was contended by Dashrath Prasad that neither he was riding the scooter nor there was any accident. A false report has been lodged against him. The Insurance Company contended that the claimant did not suffer any grievous injury and in any case, scooter No. ATS 4014 has been insured in the name of the Jaipal Rao. According to them, as Jaipal Rao has not been joined as a party to the claim petition, they cannot be compelled to answer the award or the claim.
2. The Trial Court, after considering the arguments of the parties, held that the non-claimants should deposit a sum of Rs. 12,000/- Under Section 140 of the Motor Vehicles Act. Being aggrieved by the order, the Insurance Company has filed the present appeal on various grounds.
3. It was contended on behalf of the appellant that the scooter was insured in the name of Jaipal Rao and as he has not been joined as a party, the Insurance Company cannot be held liable. Relying upon New India Assurance Co. Ltd. v. Ajay , it was contended that the Insurance Company cannot be directed to make payment of the interim award on the basis of 'no fault liability-even in a case of clear breach of conditions of the policy. It was also contended that when a vehicle is transferred and the insurance policy is not transferred in the name of the transferee, there would be no privity of contract between the transferee owner and the Insurance Company and the Insurance Company cannot be held liable to indemnify the transferee owner. It was submitted that the approach of Trial Court was patently wrong. Replying the above arguments, it was contended by the Counsel for the claimant and the owner that these defences are not available to the Insurance Company at this stage and, therefore, the Insurance Company at this stage cannot take the advantage of this legal plea. It was also submitted that prima facie there does not appear to be breach of the policy and in any case, the matter is yet to be decided and if the Trial Court holds that Insurance Company is not answerable to the claim it can recover the amount. Relying upon Santosh Rani v. Sheela Rani 1988 ACJ 299 : 1 (1987) ACC 134 (Rajasthan), it was submitted that where a vehicle is transferred much prior to the date of accident, the Insurance Company would be held liable as the liability would subsist irrespective of the transfer since neither the policy was cancelled nor the premium for the period after the transfer was refunded. It was also submitted mat in view of New India Assurance Co. Ltd. v. Avinash 1988 ACJ 322 (Rajasthan), the defence regarding transfer of the vehicle and lapse of policy is not available to the Insurance Company Under Section 96(2) of the Motor Vehicles Act. Placing reliance on National Insurance Co. Ltd. v. Ttiaglu Singh , it was contended mat in case of no fault liability, such a defence is not available to the Insurance Company. Reliance was also placed on a Single Bench judgment of this Court reported in Harcharan Singh v. Turza Bai .
4. It is no doubt true that if there is a case of breach of policy from a bare reading of the petition and or the policy itself, the Court can take notice of the fact. In the instant case, this will be decided by the Trial Court after recording evidence that whether the vehicle was transferred and the Insurance Company had agreed to or not to transfer the policy. For the purposes of Section 140, all such legal pleas are not to be considered. The Court is called upon to see whether the vehicle was insured or not. In the matter of National Insurance Co. Ltd. v. Thaglu Singh , it was contended before this Court that the policy covered only 6 employees other than the driver and the deceased persons being gratuitous passengers were not covered. this Court held that such a defence was not available to the Insurance Company in respect of application by claimants Under Section 140. this Court observed in the following words:
The statutory scheme envisages that if there is a motor accident and death or permanent disablement results from such an accident owner or owners ' of the vehicle or vehicles involved shall be liable to pay the prescribed compensation without proof of negligence and irrespective of any contributory negligence of the deceased or the injured and the amount so paid has to be adjusted out of the compensation found due under the final award. There is no provision requiring the recipient of compensation of no fault liability' to refund any part of the amount received at any stage. The legislative intent is to ensure that some succour reaches the victim or the dependants without going into the questions which may arise for consideration while passing the final award. If the vehicle is insured, naturally the liability would fall on the insurer; permitting the insurer at that stage to raise any defence other than that there is no insurance policy in force at the relevant time or to raise the statutory defences contemplated in the succeeding Chapter would be to frustrate the legislative object in introducing the concept of no fault liability'. The insured is duly protected inasmuch as if ultimately in the final award the insurer is exonerated, the Tribunal can issue appropriate direction enabling the insurer to collect the same from the owner of the vehicle. This could be the only legitimate conclusion to be drawn from the peremptory language of Section 92-A of the 1939 Act or Section 140 of the 1988 Act.
5. In this case, there is no contention that the vehicle involved in the accident is not covered by the policy. There is also no dispute that the vehicle was involved in the accident and the claimant suffered grievous injuries as a consequence of the accident. Once it is held that the vehicle was insured and was involved in the accident and the claimant suffered grievous injuries causing some permanent disability, Section 140 would immediately come into play. this Court must, therefore, hold that such a defence at the stage of consideration of the application Under Section 140 would not be available to the Insurance Company. It is not a case of breach of policy. The decision reported in New India Assurance Co. Ltd. v. Ajay , has no application to the present case. I would respectfully follow the Division Bench judgment of mis Court reported in National Insurance Co. Ltd. v. Thaglu Singh , and hold that such defence is not available.
6. The appeal is devoid of any merit and is accordingly dismissed. No orders as to costs.