Punjab-Haryana High Court
United India Insurance Co. Ltd vs Shri Sanjeev Kumar And Others on 18 August, 2010
Author: K.Kannan
Bench: K.Kannan
F.A.O.NO. 1648 OF 2008 1
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
F.A.O.NO. 1648 OF 2008
Date of decision:18th August, 2010
United India Insurance Co. Ltd.
.......Appellant
Versus
Shri Sanjeev Kumar and others
........Respondents
BEFORE: HON'BLE MR. JUSTICE K.KANNAN
Present: Mr. Gopal Mittal, Advocate,
for the appellant.
Mr. B.D.Sharma, Advocate,
for respondent No. 1.
Mr. Arun Bakshi, Advocate,
for respondent Nos. 2 and 4.
Mr. K.S.Dhillon, Advocate,
for respondent NO. 5
1. Whether Reporters of local papers may be allowed to see
the judgment? Yes
2. To be referred to the Reporters or not?Yes
3. Whether the judgment should be reported in the Digest?
Yes
K.Kannan, J.(Oral)
1. The Insurance Company is on appeal against the award passed by the Tribunal, upholding the claim of the injured/ claimant that he had suffered grievous injuries and put to serious disability on account of injuries sustained in a motor accident. F.A.O.NO. 1648 OF 2008 2 The accident was the result of collision between a Tata Sumo and a Truck. The claimant was a gratuitous passenger in the Tata Sumo. The accident is said to have been the result of negligent driving of the Tata Sumo. The Insurance Company is the insurer for the Tata Sumo.
2. The claim petition had been filed against the owner, the subsequent transferees of the vehicle and the insurer of the car in which the injured was travelling. The owner and the insurer of the other vehicle which was involved in the accident had not been joined as party in the claim petition. Consistant with the finding that the Tata Sumo was responsible for the accident, the Tribunal found respondent Nos. 2 to 5 who are owners and transferees of the vehicle, liable and the insurance company which has arrayed as respondent No.3 before the Tribunal. The first respondent before the Tribunal was the original owner and he had been exonerated, accepting the contention that the vehicle had been transferred at the time of the accident. The registered owner was the fourth respondent before the Tribunal. It is a matter of record that respondent Nos. 4 and 5 had remained ex parte and contest was principally entered by respondent Nos. 1 and 3.
3. Admitted case is that the policy of Insurance was an Act Policy and the contention in appeal by the insurer is that a gratuitous passenger in a private car is not a person to whom a compulsory insurance cover is available, consequently, an insurer cannot be made liable. The counsel for the respondent would F.A.O.NO. 1648 OF 2008 3 however contend that it is implied in Section 147 of the Motor Vehicles Act that cover risk of bodily injury and death would avail to any person, which would include a passenger in a private car. Learned counsel would refer to a decision of the Karnatka High Court in New India Assurance Co. Ltd. vs. Rajender Singh AIR 2000 Karnataka 202 to contend that a passenger in a private car would be entitled to full insurance cover for risk of death or bodily injury against an insurer who has provided the Act Policy.
4. The issue of whether the passenger in private vehicle will be entitled to cover under an Act Policy is no longer res integra. This point was pressed by the Hon'ble Supreme Court firstly in the decision coming under the Motor Vehicles Act, 1939 that gave a meaning to the expression of what was found under Section 95 of the said Act in Pushpabai Parshottam Udeshi and others versus M/s Ranjit Ginning and Pressing Co. Pvt. Ltd. and another AIR 1977 Supreme Court 1735 . The Hon'ble Supreme Court was considering the requirements of policy under Section 95 (a) and 95 (b) (i) and the Hon'ble Supreme Court held in paragraph 20 of the judgment as follows:-
"Motor Vehicles Act adopted the provisions of the English Road Traffic Act, 1960 and excluded the liability of the insurance company regarding the risk to the passengers. Section 95 provides that a policy of insurance must be a policy which insures the persons against any F.A.O.NO. 1648 OF 2008 4 liability which may be incurred by him in respect of death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. The plea that the words "third party" are wide enough to cover all persons except the person and the insurer is negatived as the insurance cover is not available to the passengers made clear by the proviso to sub- section which provides that a policy shall not be required.
"(ii) except where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment, to cover liability in respect of the death of or bodily injury to persons being carried in or upon or entering or mounting or alighting from the vehicle at the time of the occurrence of the event out of which a claim arises."
Therefore, it is not required that a policy of insurance should cover risk to the passengers who are not carried for hire or reward. As under Section 95 the risk to a passenger in a vehicle who is not carried for hire or reward is not required to be insured the plea of the counsel for F.A.O.NO. 1648 OF 2008 5 the insurance company will have to be accepted and the insurance company held not liable under the requirements of the Motor Vehicles Act."
5. The last expression found in the judgment is clearly to the effect that an insurance policy is not required to cover the risk to a passenger who are not carried for hire or reward. The language in the new Act has not changed. Section 147 adds a new class of person namely "the owner of the goods travelling alongwith the goods in a goods carriage" as also to be entitled to a compulsory insurance cover. The effect of the change in the 1988 Act was considered in the context of the liability of the insurer in goods carriage to persons who are travelling along with the goods. It was held by the Hon'ble Supreme Court in Satpal versus New India Insurance Co. Ltd 2000 ACJ 1 that even owner of the goods would be entitled to full insurance cover and that would answer a description of "any person" travelling in a vehicle to whom a compulsory insurance cover would be possible. The judgment of the Hon'ble Supreme Court in Satpal's case (supra) was found not to lay down the law correctly in a subsequent three member Bench of the Hon'ble Supreme Court in New India Assurance Co. Ltd. vs. Asha Rani and others (2003) 2 SCC 223. While considering the issue of liability of the insurer. The Hon'ble Supreme Court took note of the amendment which was made to the Motor Vehicles Act on 14.11.1994 and held that only owner of the goods carriage travelling in the goods carriage will be entitled to a insurance cover. This was again F.A.O.NO. 1648 OF 2008 6 rendered in the context of the expression found under Section 147 of the Act, while examining who are the persons, entitled to insurance cover, the decision came full circle when it was authoritatively laid down in United India Insurance Co. Ltd. versus Tilak Singh (2006) ACJ that the Hon'ble Supreme Court had examined the case of a pillion rider on a motor cycle. This decision was also rendered in the context of what Section 147 provided for and the classes of persons to whom the compulsory insurance cover will be applicable.
6. With reference to the decision of the Karnataka High Court in Rajender Singh's Case(supra), I respectfully state that the decision of the Karnataka Court does not correctly interpret the law and has not properly appreciated this decision of the Hon'hle Supreme Court in Pushpabai's case(supra). The decision in Pushpabai's case still holds the field except to the extent that subsequent to the decision, the Insurance Tariff Committee made some changes in urging the insurer to provide right of risk also for passengers while collecting an extra premium. This has come to be understood as a Package Policy in common parlance. A Comprehensive Policy or Package Policy invariably covers the risk in a passenger car as well and would also cover a risk to a pillion rider, a motor cyclist. The directives by the Insurance Regulatory Authority have taken note of the expressions of 'any person' travelling in a vehicle in the manner interpreted by the Hon'ble Supreme Court and it seeks to improve the conditions for the insured to properly cover the risk F.A.O.NO. 1648 OF 2008 7 also to passengers in a private vehicle. Section 147 of the Act itself makes a clear dichotomy between person who are travelling in a transport vehicle that would include a member of public and private service vehicle. While a compulsory insurance cover is extended to passengers in the transport vehicle, no such specific inclusion is made for private vehicles. Section 147 of the said Act while it covers the risk to passengers in a transport vehicle says through Section 147(1)(b) (ii)(i) that it would include the risk of bodily injury to any person of a public service vehicle caused by or arising out of the use of the vehicle in a public place. This clause itself will give an answer to the problem posed by the learned counsel appearing for the claimant. If his interpretation must be accepted, there would not have been a need even for a specific clause in the manner provided by the statute through sub clause referred to above. A specific reference is made only because that the mere expression of "any person" would not have included a passenger unless specifically provided to be so. I have therefore, no doubt in my mind that an Act Policy cannot cover the risk to a passenger in a private vehicle, unless the risk to passenger is specifically undertaken. It is again no argument to state that a passenger is not either the first party namely the owner nor the second party which is the insurer. A third party is invariably understood as a person who is nor an insurer, not an owner; and not also a passenger, for a passenger occupies in common parlance and normally stands in distinct category than a person who is literally third party to the first and the second F.A.O.NO. 1648 OF 2008 8 parties. The moniker "passenger" admits a different connotation than a third party. Courts have recognised the distinction on a whole string of authorities coming from Pushpabai, Satpal but still later decisions in Asha Rani and Tilak Singh. It is therefore, not tenable to contend that a passenger would obtain a full insurance cover in an Act Policy. The liability cast on the insurer is, therefore, clearly erroneous and the award passed against the insurer is set aside and the appeal filed by the insurer is allowed.
7. The case would still require consideration for enhancement sought at the instance of the Insured for I do not while allowing the appeal, wish to upset the finding that the Tribunal has already given to that effect. It was the driver of the Tata Sumo who was responsible for the accident. Vicariously the owner shall become liable for the same.
8. In this case the cross objection addresses an issue of enhancement of compensation against the insurer which has been made liable by the award. In this case I have found that the insurer is not liable but still I have examined the cross appeal as an independent appeal filed by the injured for a claim against the owner. The contention of the learned counsel is that the injured was a carpenter and he was also a trainer in a health club. His contention was that he was earning about Rs. 8,500/- as a carpenter and health club trainer per month. The Tribunal however took his income to be Rs. 3,000/- with no definite evidence with reference to his income. Before the Tribunal there was also evidence that the injured was hospitalised for over four F.A.O.NO. 1648 OF 2008 9 months and the grievance of the claimant is that no hospital expenses at all have been provided for in the award. He is aggrieved by the fact that there is no provision for special diet nor even the attendant charges provided for. The lapse has been in some sense on the part of the claimant himself for he has not chosen to file any record in the same and rest contended with his oral evidence as sufficient to make the claim for Rs. 3,00,000/- for hospitalisation and for other heads of claims referred to above. I have no better documents before me but still I will not deny to the claimant any hospital charges. Atleast if there had been definite oral evidence regarding the hospital expenses it could have been accepted. If the claimant has incurred Rs. 3,00,000/- as expenses in the hospital for treatment, these treatment expenses in the hospital cannot be without cash memos or bills. For the prodigious expenses the claimant ought to have exercised reasonable care to secure those relevant bills. I will provide for expenses of Rs. 50,000/- for four months of hospitalisation. I will provide a further amount of Rs. 15,000/- towards the special diet and offer to him towards attendant charges for the past, present and future to a sum of Rs. 25,00/-.
9. Before the Tribunal a disability certificate had also been produced to show that the claimant was fully paralysed and he has not been able to walk any long. He is only carried through wheel chair. A young person who was also the health trainer to be pushed around in a wheel chair is truly a poignant situation. Having regard to the fact that he has 100% disability F.A.O.NO. 1648 OF 2008 10 which is certified to be so by the Medical Board, I would take his monthly income even in the absence of any documentary proof to be Rs. 4,000/- per month, taking loss of income as Rs. 48,000/- per annum, adopt a multiplier of 16 as the compensation that would become payable. The amount so reckoned will be Rs. 7,68,000/-. Over this amount shall also be added the claim for pain and suffering. A person who has undergone a prolonged hospitalisation, I award Rs. 25,000/- for pain and suffering. The amount which have already been provided for towards hospitalisation, special diet and attendant charges would add to secure an amount of Rs. 8,83,000/-. The Tribunal has awarded Rs. 6,23,000/- and there shall be an additional amount of Rs. 2,60,000/-. This liability shall be borne by the registered owner of the vehicle, who is fourth respondent before the Tribunal and respondent in appeal. The first respondent before the Tribunal was already exonerated. It was contended by the learned Counsel appearing for the fourth respondent that he has transferred the vehicle to fifth respondent and he has also given affidavit that in case of any damage or claims he will indemnify the fourth respondent. I cannot admit such an evidence in the appeal for the first time when the fourth respondent has remained ex parte. If there is any contract between them as to how the liability shall be settled, it shall be independently worked out by the fourth respondent. The fifth respondent has remained ex parte and it has not been provided anywhere in the trial that the fifth respondent is also liable to satisfy the claim. Learned F.A.O.NO. 1648 OF 2008 11 counsel for the injured would also contend that the driver shall be also made liable. While a driver is responsible for the accident, I will not hold him financially liable for the claim. For the principle of vicarious liability, the owner, will be solely responsible for answering the claim and therefore, the driver shall also be exonerated of the financial liability.
10. While allowing the appeal for reasons stated already, the cross objection, being treated as an independent appeal for the injured, shall be partly allowed to provide for enhancement of compensation by Rs. 2,60,000/- with interest at 6% from the date of the petition till the payment to come out of the fourth respondent in appeal and fourth respondent before the Tribunal. It appears that the court had permitted 60% of the award to be recovered from the insurer and the remaining amount is still in deposit to the credit of the case before the Tribunal. The said amount shall be permitted to be withdrawn by the insurer in terms of this judgment. The amount deposited before this Court at the time of preferring the appeal, if it is still available before this Court, shall also be permitted to be withdrawn by the insurer.
[K.KANNAN] JUDGE 18th August, 2010 Shivani Kaushik