Karnataka High Court
The Divisional Manager vs Davalsab S/O. Allabas Hunagund on 14 August, 2023
Author: Hanchate Sanjeevkumar
Bench: Hanchate Sanjeevkumar
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NC: 2023:KHC-D:8911
MFA No. 21726 of 2012
C/W MFA No. 22434 of 2012
IN THE HIGH COURT OF KARNATAKA
DHARWAD BENCH
DATED THIS THE 14TH DAY OF AUGUST, 2023
BEFORE
THE HON'BLE MR JUSTICE HANCHATE SANJEEVKUMAR
MISCELLANEOUS FIRST APPEAL NO.21726/2012 (MV-I)
C/W
MISCELLANEOUS FIRST APPEAL NO.22434/2012 (MV-I)
IN MFA.NO.21726/2012:
BETWEEN:
THE DIVISIONAL MANAGER,
UNITED INDIA CO. LTD.,
BRANCH OFFICE, MYSURU,
REPRESENTED BY ITS DIVISIONAL OFFICE,
NO.2, JOSHI BUILDING, I FLOOR,
LAMINGTON ROAD, HUBBALLI,
REPRESENTED BY ITS DIVISIONAL MANAGER.
...APPELLANT
(BY MISS.VINAYA KUPPELUR, FOR SRI N.R.KUPPELUR, ADVOCATE.)
Digitally AND:
signed by
SUJATA
SUBHASH 1. SRI DAVALSAB S/O. ALLABAS HUNAGUND,
PAMMAR AGE: 54 YEARS, OCC: NIL,
R/O: MANTUR ROAD, BEHIND RAILWAY
STATION, HUBBALLI.
2. SRI R.N.NAGARAJU,
AGE: MAJOR, OCC: BUSINESS,
R/O: NO.276, 3RD CROSS 2ND STATE,
3RD BLOCK, BASAVESHWAR NAGAR,
BENGALURU-01.
...RESPONDENTS
(BY SRI SURAJ M. KATAGI, FOR SRI V.G.BHAT, ADVOCATE FOR R1;
SRI K.K.TERGUNTI, ADVOCATE FOR R2.)
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NC: 2023:KHC-D:8911
MFA No. 21726 of 2012
C/W MFA No. 22434 of 2012
THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER
SECTION 173(1) OF MOTOR VEHICLES ACT, 1988, PRAYING TO
CALL FOR THE RECORDS CONNECTED WITH MVC NO.385/2008, ON
THE FILE OF THE III ADDITIONAL SENIOR CIVIL JUDGE AND
ADDITIONAL MACT, HUBBALLI, EXAMINE THE SAME AND SET ASIDE
THE AWARD DATED 21.11.2011, IN THE INTEREST OF JUSTICE.
IN MFA NO.22434/2012
BETWEEN:
DAVALSAB S/O. ALLABAKSHA HUNAGUND
AGE: 50 YEARS, OCC:NIL,
R/O: MANTUR ROAD, BEHIND RAILWAY
STATION, HUBBALLI.
...APPELLANT
(BY SURAJ M. KATAGI, FOR SRI V.G.BHAT, ADVOCATE)
AND:
1. R.N.NAGARAJU,
AGE: MAJOR, OCC: BUSINESS,
R/O: NO.276, 3RD CROSS, II STAGE,
III BLOCK, BASAVESHWARA NAGAR,
BENGALURU.
2. UNITED INDIA INSURANCE CO. LTD.,
DIVISIONAL OFFICER, MYSURU,
R/BY BRANCH OFFICE, HUBBALLI,
KESHWAPUR, HUBBALLI-580 030.
...RESPONDENTS
(BY MISS. VINAYA KUPPELUR, FOR SRI N.R.KUPPELUR, ADVOCATE,
FOR R2;
R1 - NOTICE SERVED.)
THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER
SECTION 173(1) OF MOTOR VEHICLES ACT, 1988, PRAYING TO
ALLOW THIS APPEAL BY ENHANCING THE COMPENSATION AWARDED
BY THE III ADDITIONAL SENIOR CIVIL JUDGE AND ADDITIONAL
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NC: 2023:KHC-D:8911
MFA No. 21726 of 2012
C/W MFA No. 22434 of 2012
MACT, HUBBALLI, IN MVC NO.385/2008, DATED 21.11.2011, FROM
RS.1,92,688/- TO RS.4,87,000/- IN THE ENDS OF JUSTICE.
THESE APPEALS COMING ON FOR ADMISSION THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
JUDGMENT
Though these appeals are listed for admission, with consent of both parties, the same are taken up for final disposal.
2. MFA No.21726/2012 is filed by the insurance company challenging the judgment and award dated 21.11.2011, passed by the tribunal in MVC No.385/2008, questioning the liability fixed on it. Whereas, MFA No.22434/2012 is filed by the claimant seeking enhancement of compensation.
3. Heard the arguments and perused the records.
4. In this case the factum of accident is not in dispute. The only issue involved is liability to pay compensation and the quantum of compensation. -4-
NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012
5. Learned counsel for the appellant insurance company submitted that in the present case the claimant has travelled as a gratuitous passenger but not employee of the respondent No.2. Therefore the insurance company is not liable to indemnify the owner and to pay the compensation. Further urged another ground that the driver of the tanker lorry was not having valid and effective driving licence to drive the tanker lorry which contains spirit which is a hazardous material. Therefore, there is violation of conditions of insurance policy. Hence the insurance company is not liable to indemnify the owner and to pay the compensation.
6. On the other hand, learned counsel for claimant submitted that even though the claimant has traveled as security guard for escorting the lorry but it is in connection with the employment for escorting the tanker lorry which contained hazardous material. Therefore, he is to be construed as employee. It is also submitted that under the insurance policy an additional premium of Rs.75/- is -5- NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 collected for Non Fare Paid Passenger (NFPP). Therefore, as per the condition enumerated in the policy, as stipulated in the IMT Regulations, the risk of claimant is also covered. Further submitted that, the driver was holding valid and effective driving licence to drive the tanker lorry. Hence, there is no violation of conditions of insurance policy. Therefore submitted that the insurance company is liable to pay compensation by indemnifying the owner. It is also submitted that the claimant is entitled for enhancement of compensation. Therefore prayed for enhancement of compensation.
7. In the present case the factum of accident is not disputed. On 11.11.2007 claimant was traveling in Ashok Leyland Tanker lorry as an escort, security person and the driver drove the same with rashness and negligent attitude. Hence the tanker lorry met with accident and the claimant sustained injuries. This factum is not disputed. The insurance company has raised two grounds challenging the liability fixed on the insurance company, -6- NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012
1) claimant was not an employee under the owner of tanker lorry but as a security guard of some other firm/agency, he was engaged in the tanker lorry for escorting only; hence, he is not employee so as to cover risk under the insurance policy; 2) the driver was not holding valid and effective driving licence as per section 14 of the M.V.Act, as it requires renewal of driving licence, subject to condition of undergoing a refresher course and in the present case much before the accident caused, the driving licence was expired and subsequently there was no renewal or undergone refresher course. Therefore there is violation of conditions of policy and the insurance company is not liable to indemnify the owner and to pay the compensation. Thus it is submission that the claimant is not a third party. Hence benefit of pay and recovery also cannot be extended to the claimant and the owner of the tanker lorry shall pay the compensation to the claimant without making an order of pay and recovery. -7-
NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012
8. In the present case as per Ex.R.1 insurance policy, an additional premium of Rs.75/- is collected under the head Non Fare Paid Passenger (NFPP). It is revealed from Ex.P.1 FIR that the claimant was travelling for escorting the tanker lorry as a security guard and there was another cleaner and driver. Whether this claimant was employee under the owner of the tanker lorry is not forthcoming from the evidence. It is the contention of the learned counsel for insurance company that the claimant was employee of some other agency/firm, but he was engaged for the purpose of escorting the tanker lorry since the tanker lorry contained hazardous material of spirit.
9. When this being the factual matrix involved, then the clauses enumerated in the insurance policy under the IMT Regulations is to be perused. The conditions enumerated under the insurance policy as per IMT Regulations is extracted below.
IMT 37 Legal Liability to Non-Fare Paying Passengers other than Statutory Liability -8- NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 except the Fatal Accidents Act, 1855 (Commercial Vehicles only) In consideration of the payment of an additional premium of Rs.75 and notwithstanding anything to the contrary contained in Section II-1(b) and (c) it is hereby understood and agreed that the Company will Indemnify the Insured against his legal liability other than liability under the Statute (except the Fatal Accidents Act 1855) in respect of death of or bodily injury to:-
i) Any employee of the within named insured who is not a workman within the meaning of the Workmen's Compensation Act Prior to date of this endorsement and not being carried for hire or reward.
ii) Any other person not being carried for hire or reward provided that the person is
a) charterer or representative of the charterer of the truck
b) Any other person directly connected with the journey in one form or other being carried in or upon or entering or mounting or alighting from any Motor Vehicle described in the schedule of the policy.
Subject otherwise to the terms exceptions conditions and limitations of this policy.
10. In the present case the claimant has not travelled by payment of fare or hiring the vehicle or for reward purpose. The claimant has travelled for escorting -9- NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 the tanker lorry which contained hazardous material of spirit. It is mandatory that a security personnel shall escort tanker lorry which contained a hazardous material. Therefore the claimant cannot be strictly construed as an employee under the owner of tanker lorry. But the claimant can be categorized as charterer or representative of the charterer of the truck directly connected with the journey. Therefore as per this NFPP, the risk of the claimant is covered under the insurance company. Therefore the claimant cannot be categorized as a gratuitous passenger but he is charterer or representative of the charterer of the truck. Therefore when additional premium of Rs.75/- is collected, even though the injured person is not a cleaner or employee as enumerated in Section 147 of the M.V.Act, but he was travelling having direct connection with the journey. The risk is covered when additional premium is collected under the Non Fare Paid Passenger (NFPP). Therefore in this case since NFPP is collected, as per IMT Regulation No.37, the insurance company is bound to indemnify the owner of the tanker
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 lorry, subject to fulfilling the other conditions such as permit, holding of driving licence, etc.,.
11. So far as answering to another condition raised by the learned counsel for insurance company that the claimant cannot be considered as third party and hence the benefit of pay and recovery is not extended is concerned, as per sub-section (1) of section 149 of M.V.Act, the insurance company as if the judgment debtor shall satisfy the claim to 'third parties', then recover from the owner of the vehicle as per procedure prescribed therein when there is establishment of defence raised under sub-section (2) of section 149 of the Act. Therefore fundamentally sub-section (1) of section 149 of the Act stipulates wherein a case of establishing the defences available under sub-section (2) of section 149 of the Act, then the insurance company as if the judgment debtor shall satisfy the claim only so far as persons covered under section 147 of the M.V.Act are concerned and then recover it from the owner. Therefore the principle of pay
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 and recovery whether it is available only for third party/ies or to all other categories of persons also is to be considered.
12. The object of applying the principle of pay and recovery is to safeguard interest of third party/ies. For inter-se dispute between the insurer and the insured, third parties cannot be made sufferer or being deprived of receiving compensation, therefore, under these circumstances for safeguarding and protecting the rights of third party, not to involve in the inter-se dispute between the insurer and the insured, such principle is made applicable directing the insurance company to pay compensation to the third party/ies with a liberty to recover the same from the owner of the vehicle. Here, the main object of applying the principle of pay and recovery is to protect the rights of third party/ies. But the claimant in the present case is to be considered as a third party or not is the question.
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012
13. The claimant has travelled in connection with the journey for which the truck was engaged. Therefore even though the claimant has travelled as a charterer or authorized representative of charterer of truck, but cannot be considered as a third party. The claimant has travelled as occupant in the truck being a charterer or authorized representative of the charterer of the truck. Therefore, the claimant being occupant in the lorry, travelled by sitting inside the cabin of the truck, cannot be considered as a third party. Third party means, who is outside the vehicle without any attachment with the vehicle. Therefore the claimant being occupant inside the cabin of the tanker truck is attached with the truck and therefore not outside the truck and cannot be considered as a third party. Therefore under these factual matrix and circumstances, the principle of pay and recovery is not applicable.
14. The word 'third party' is not defined in the Act. Therefore 'third party' means a person who is outside the vehicle suffered injury due to motor vehicle accident.
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 Hence the claimant is proved to be not a third party. Therefore, benefit of principle of pay and recovery is not available to the claimant.
15. With regard to the fact that the driver of the tanker lorry was not holding valid and effective driving licence to drive the tanker truck contained hazardous material of spirit, Ex.R.7 is the driving licence extract of the driver of the tanker truck who was authorized to drive the truck initially from 08.07.2005 to 08.07.2006. Then it was renewed from 14.10.2009 to 13.10.2010. The accident occurred on 11.11.2007. As per section 14 of the M.V.Act, driving licence for driving truck containing hazardous material is issued only for a period of one year. This period of one year is replaced by three years by way of amendment made by virtue of Act No.32 of 2019 w.e.f. 01.09.2019. But before this the driving licence for driving the truck containing hazardous material is for one year subject to renewal of licence by undergoing one day refresher course of the prescribed syllabus. Therefore, as
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 on the date of the accident i.e., on 11.11.2007 the driver of the tanker truck did not have valid and effective driving licence as it is proved from Ex.R.7 driving licence extract. Therefore, violation of condition of insurance policy is proved.
16. As per sub-section (2) of Section 149 of M.V.Act, the insurance company is able to establish its defence of violation of conditions of policy, but the claimant is not entitled for benefit of principle of pay and recovery for the reason that the claimant is not a third party as discussed above. The principle of pay and recovery is applicable so far as third party/ies. Therefore the liability fixed on the insurance company by the tribunal is liable to be set aside. The owner of tanker truck No.KA- 02/D-7612, which carried hazardous material shall pay compensation to the claimant. To this extent the appeal filed by the insurance company is liable to be allowed. Hence on liability issue, the judgment and award is modified.
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012
17. In the present case as per medical evidence on record, it is proved that the claimant has suffered the following injuries.
Injuries in lower end of Shaft (Rt) Radius, involving the particular surface, fracture of left Maxillar involving alveolar process and anterior wall with soft tissue haematoma, injuries in thigh, pelvis, knee, wrist, forehead, etc.,.
18. The tribunal has awarded the compensation under various heads as follows:
Sl. Heads. Amount in
No. (Rs.)
1. Towards pain and suffering. 10,000
2. Towards loss of future earnings. 1,15,500
3. Towards loss of earning during 10,500
treatment.
4. Towards medical expenses. 21,688
5. Towards loss of amenities and 20,000
disfiguration.
6. Towards diet and nutrition 5,000
charges.
7. Towards conveyance charges. 5,000
8. Towards attendant charges. 5,000
Total: 1,92,688
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NC: 2023:KHC-D:8911
MFA No. 21726 of 2012
C/W MFA No. 22434 of 2012
19. Accordingly the quantum of compensation
awarded by the tribunal is found to be lesser side. Accordingly a compensation of Rs.30,000/- is awarded under the head injuries, pain and suffering. The compensation of Rs.21,688/- awarded by the tribunal towards medical expenses is found to be as per actual bills and receipts. Hence, the same is kept intact. A compensation of Rs.40,000/- is awarded under the head loss of amenities. Further a compensation of Rs.30,000/- is awarded under the head incidental expenses like food, diet, transportation charges, attendant charges, etc.,.
20. The doctor examined as PW.2 has stated that the claimant had suffered 16-18% of permanent physical disability with respect to his right upper limb. The doctor PW.3 has stated that the claimant had suffered 16% in respect of visual impairment and he is having 30% as loss of vision in the left eye. Therefore as per Exs.P.46 and P.49 disability certificates, coupled with evidence of PW.2 and PW.3, the claimant had suffered 16-18% of
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 permanent physical disability towards right upper limb and 30% of loss of vision of the left eye of the claimant. Therefore it can be held that the claimant has suffered 30% of functional disability towards whole body.
21. The tribunal has taken notional income of Rs.3,500/- per month. But the accident was caused on 11.11.2007. Therefore notional income would be Rs.4,000/- per month as recognized by the Karnataka State Legal Services Authority. Since the claimant had suffered significant injuries, as discussed above and disability is severe one, it affects the future prospects also. Therefore certain income is to be added towards loss of future prospects even in case of injuries as per principles of law laid down by the Division Bench of this Court in the case of New India Assurance Company Vs. Abdul S/o Mehaboob Tahasildar in MFA No.103807/2016 C/w. MFA Nos.103835/2016 & 103807/2018 and as per the judgment of the Hon'ble Supreme Court in the case of Sidram vs. Divisional Manager, United India
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 Insurance Company Limited and another reported in (2023) 3 SCC 439.
22. Therefore, considering the age group as decided by the Hon'ble Supreme Court in the case of National Insurance Company Limited vs. Pranay Sethi and others, reported in (2017) 16 Supreme Court Cases 680, the claimant being aged 52 years at the time of accident, 10% of income is to be added towards loss of future prospects. The appropriate applicable multiplier is 11. Therefore loss of earning capacity due to disability is re-assessed and quantified as Rs.1,74,240/- (Rs.4,000 + 10% x 30% x 12 x 11).
23. Further, a compensation of Rs.12,000/- is awarded under the head loss of income during the laid up period for a period of three months. Thus, the claimant is entitled for total compensation under various heads as follows:
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NC: 2023:KHC-D:8911
MFA No. 21726 of 2012
C/W MFA No. 22434 of 2012
Sl. Heads. Amount in
No. (Rs.)
1. Towards injuries, pain and 30,000
suffering.
2. Towards medical expenses. 21,688
3. Towards loss of amenities. 40,000
4. Towards loss of income during 12,000
laid up period and medical
treatment period.
5. Towards incidental expenses like 30,000
food, diet, transportation
charges, attendant charges, etc.,.
6. Towards loss of future earning 1,74,240 capacity.
Total: 3,07,928
24. Therefore, the claimant is entitled for total compensation of Rs.3,07,928/- as against Rs.1,92,688/- awarded by the tribunal, which shall carry interest at the rate of 6% p.a. from the date of filing of the petition till realization.
25. Accordingly, I pass the following:
ORDER
i) Both appeals are allowed in part.
ii) The judgment and award dated 21.11.2011, passed by the III Addl. Senior Civil
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012 Judge and Addl. MACT, Hubballi, in MVC No.385/2008, stands modified.
iii) The claimant is entitled for total compensation of Rs.3,07,928/- as against Rs.1,92,688/- awarded by the tribunal, along with interest at the rate of 6% p.a. from the date of filing of the petition till realization.
iv) The claimant is not entitled for interest for the delayed period of 98 days in filing the appeal.
v) The liability fastened on the insurance company is hereby set aside.
vi) The respondent No.1 owner of tanker truck No.KA-02/D-7612, shall deposit the compensation amount within a period of eight weeks from the date of receipt of a copy of this judgment.
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NC: 2023:KHC-D:8911 MFA No. 21726 of 2012 C/W MFA No. 22434 of 2012
vii) The registry is directed to send back the trial Court records along with a copy of this judgment.
viii) The amount in deposit made by the insurance company shall be refunded to it.
ix) No order as to costs.
x) Draw award accordingly.
SD/-
JUDGE
MRK
List No.: 2 Sl No.: 18
CT-ASC