Telangana High Court
The Reg.Mang,Oriental Insurance ... vs Mumtaz.Moizuddin, 7 Ors on 21 October, 2022
Author: M.Laxman
Bench: M.Laxman
THE HON'BLE SRI JUSTICE M.LAXMAN
CITY CIVIL COURT APPEAL Nos.59, 60, 101, 207 of 2002;
178 and 179 of 2003
COMMON JUDGMENT:
1. Since the issue raised in all the appeals is one and the same, they are being disposed of by this common judgment.
2. All these appeals arise out of the common judgment and decree dated 20.10.2001 in O.S.Nos.664 & 532 of 1993 on the file of the Additional Judge, City Small Causes Court-cum-VI Senior Civil Judge, City Civil Court, Hyderabad, wherein both the suits were decreed by awarding damages in the form of compensation for the death of Aizaz Moizuddin and also towards hire charges for the two electrical motor pump sets hired by M/s.ABC India Limited.
3. O.S.No.664 of 1993 was filed seeking compensation of Rs.5,00,000/- for the death of Aizaz Moizuddin in the incident that has occurred on 10.06.1990 while shifting the Budda Statue from the shore of Hussain Sagar Lake to rock Zibraltur in the Hussain Sagar Lake. O.S.No.532 of 1993 was filed seeking damages towards loss of hire charges for the two electrical motor pumps supplied to the contractor 2 i.e., defendant Nos.1 and 2 in the suits for pumping out the stagnated water in the Plantoon. Both suits were decreed by granting compensation of Rs.5,00,000/- for death of deceased and Rs.3,00,000/- towards loss of hire charges. Hence, all these appeals are individually filed by the contractor, Government and the Insurance Company.
4. For the sake of convenience, the parties hereinafter are referred to as they are arrayed in O.S.No.664 of 1993.
5. The sum and substance of the case of the plaintiffs is that they run M/s. Mumtaz and Sons, which is a proprietary concern involved in supply of various materials. Defendant Nos.1 and 2 hired two electrical motor pump sets to pump out the water stagnated on the plantoon of the barge, agreeing to pay hire charges of Rs.225/- per day for each pump and the deceased - Aizaz Moizuddin was employed to oversee the pumping of water from the stagnated plantoon. On 10.03.1990, in the morning hours, while shifting the Budda Statue towards Zibraltur from the shore of the Hussain Sagar Lake on the barge pulled by tug, the Budda statue slid off and fell off in the water. The statue was sunk 3 and the deceased was one of the persons among the ten (10) people, who lost their lives in the incident. Apart from death, two electrical motor pump sets supplied by the plaintiffs were also submerged and they could not be retrieved. The deceased was 22 years old and he was studying Engineering II year. On the date of incident, he was deputed to oversee the work of dewatering from the plantoon. In the said mishap, the deceased died and therefore, they claimed compensation for the death of the deceased. Apart from the compensation, they also sought damages for the loss of hire charges for the two motor pumps hired by defendant Nos.1 and 2, who are the contractors. They claimed Rs.5,00,000/- towards compensation for death of deceased Rs.3,00,000/- for loss of hire charges. Defendant Nos.1 and 2 are the contractors from defendant No.4. The defendant No.3 is the insurance company which insured the statute and freight. As per the plaintiffs, all of them are jointly and severally liable to pay the compensation and damages as claimed above.
6. Defendant No.1, 3 and 4 filed separate written statements. Defendant No.1 in written statement did not deny the aspects of hiring of two pump sets and employing 4 the deceased to oversee the pump sets installed to dewater from the plantoon. However, they denied the educational qualification, earnings and the age of the deceased. They also denied that they hired two pump sets and agreed to pay hire charges. However, they claimed that work of dewatering was assigned to the plaintiffs and they installed the pump sets to dewater and deputed the deceased to supervise the dewatering through the pumps. If any liability is fastened, defendant No.3 being the insurer, is liable to pay compensation and damages.
7. Defendant No.3 admitted the issuance of insurance policy, which was covering the statute as well the freight. According to them, there was no policy covering the loss of human beings, but there was a policy to cover the freight only. The freight insurance did not cover the liability of the insurance company for loss of any human beings, but it only covers the loss or damages to the subject matter, which is the good undertook for the transport. They also admitted that the policy was existing as on the date of incident covering the statute as well as the freight and they disclaimed any liability towards the claim made by the plaintiffs.
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8. Defendant No.4 was impleaded subsequently. Defendant No.4 as well as the Government also filed independent written statements pleading that the Government has no liability to pay compensation to the plaintiffs. The Government disclaimed liability on the ground that there was coverage of any loss or damages to the statute as well as the freight. It is also their claim that as per the terms and conditions of contract in between defendant Nos.1 & 2 and defendant No.4, defendant Nos. 1 & 2 undertook to incur any liability on account of loss of any human being in the course of execution of the work. They relied upon clause No.45 of the terms and conditions of contract. They also stated that the suit is barred by limitation and prayed to dismiss the suit.
9. Based on the above pleadings, the Court below has framed the following issues:
"Issues in O.S.No.664 of 1993:
1. Whether the plaintiffs are entitled for Rs.5,00,000/-
against defendant Nos.1 to 3 jointly and severally towards compensation for the loss of life of late Aizaz Moizuddin with interest thereon at 18% p.a. till the date of realization?
2. Whether Mr.Mumtaz Moizuddin was the owner of the pump sets, and that he lent the pump sets on hire? 6
3. Whether the plaintiff has any cause of action to file the suit?
4. Whether Aizaz Moizuddin died due to the gross negligence of defendant No.1?
5. Whether there was no privity of contract between the plaintiff and defendant No.3 for paying any damages due to death of Aizaz Moizuddin?
6. To what relief?
Additional Issues:
1. Whether there was privity of contract between late Aizaz Moizuddin and defendant No.4?
2. Whether the suit is barred by limitation?
Issues in O.S.No.532 of 1993:
1. Whether plaintiff is entitled for the suit claim and interest as prayed for?
2. Whether defendant No.3 has no privity of contract with plaintiff and not liable to pay the suit amount?
3. Whether the suit is bad for non-joinder of necessary party?
4. Whether this Court has no territorial jurisdiction to try the suit?
5. Whether the suit is barred by limitation?
6. Whether defendant No.1 is not liable to pay the suit claim?
7. To what relief?
Additional Issue:
1. Whether there was privity of contract between late Aizaz Moizuddin and defendant No.4?"
10. The plaintiffs, to support their case, examined PW1 & PW2 and relied upon Exs.A1 to A24. The defendants, to support their case, examined DW1 & DW2 and relied upon Exs.B1 to B3.7
11. The trial Court, after considering the pleadings and evidence on record, decreed the suit stated supra and fastened the liability on the defendants jointly and severally.
Aggrieved by the same, the present appeals have been preferred.
12. Heard the learned counsel representing for the appellants and the respondents and perused the material placed on record.
13. The following points emerge for consideration.
"1) Whether O.S.No.664 of 1993, which was filed for compensation for the death of Aizaz Moizuddin, was barred by limitation?
2) Whether the compensation fixed by the Court below is just and reasonable?
3).Whether the accident was result of negligence or it falls under the rule of strict law?
4) Whether the Insurance Company/defendant No.3 is liable to pay the compensation on the strength of Ex.B3/Insurance Policy.?
5) Whether the compensation fixed towards hire charges required any interference?"
Points 1 and 3:
14. The facts and evidence on record show that defendant No.4 assigned contract to defendant Nos.1 & 2 to transport Monolithic Buddha statute from the shore of Hussain Sagar Lake to rock Zibraltur located in the middle of the Hussain 8 Sagar Lake. In the morning hours, on 10.03.1990, when the monolithic statute was being shifting from the shore to Zibraltur rock on the barge pulled by the tug, the monolithic Budda statute slid of and fell into the water. In the mishap, 10 human lives are lost including the deceased. The barge and the tug were also sunk in the water.
15. It is also not in serious dispute that the deceased one among the ten (10) persons, who lost his life in the accident and he was supervising the dewatering of plantoon. It is also not in serious dispute that two motor pumps were installed to dewater the plantoon. The present suits have been instituted on the premise that the accident which resulted the death of the deceased was on account of gross negligence and it was not claim of strict liability. However, the death was resulting of tortious act.
16. The Court below while adverting to limitation has relied upon the two decisions of the Hon'ble Apex Court in the case of (i) Jayalaxmi Salt Works Private Limited vs. State of Gujarat - (1994 SCC (4) 1)
(ii) Bank of India vs. Laxmi das - (AIR 2000 SC 1172). 9
17. The facts in the said two cases show that the claims are arising out of damages suffered on account of damages, but not relating to the compensation for the death of a human being. Those claims are also based on the common law remedies for tortious act. In the context of liability under the common law for the tortuous Act, the Apex Court has referred to the residuary Article of Limitation Act prior to 1963 Amendment Act to the Limitation Act. Strictly speaking, the principle applied in the said two cases is not applicable to the facts of the present case.
18. In the present case, the claim was made for compensation for the death of the individual, who died in the accident, which accident claimed to be a tortious act of negligence on the part of the contractor involved in the transportation of monolithic Budda statute from the shore of Hussain Sagar to Zibraltur rock.
19. The learned counsel for defendant Nos.1 & 2 had relied upon the decision of the Apex Court in the case of Damini and others vs. Managing Director, Jodhpur, Vidyuth Vitran Nigam Limited and Another (2017 9 SCC 443) and 10 contended that all fatal accidents must be laid under the Fatal Accident Act, 1855 and Article 82 of Limitation Act thereof deals with the limitation for filing the suits for compensation for death in the fatal accident. A contention was raised before the Apex Court to the effect that the claims under the fatal accident are based on the negligence and the limitation contained under Article 82 was applicable but not Article 113 of the Limitation Act.
20. Now the question is whether the Fatal Accident Act applies to the case which demonstrates that the incident is combination of negligence and the rule of strict liability. If the claim is filed based on strict liability but not based on the negligence, whether such claim has to be under the Fatal Accident Act. In fact, this issue was raised in Jayalaxmi Salt Works Private Limited's case (supra). However, in the facts and circumstances of the said case, the Apex Court found that the incident in the said case was not result of strict liability. Therefore, the said question was not fallen for consideration.11
21. To answer above issue, it is relevant to refer to Section 1(a) of Fatal Accident Act, which reads as under.
"Suit for compensation to the family of a person for loss occasioned to it by his death by actionable wrong.- Whenever the death of a person shall be caused by wrongful act, neglect or default, and the act, neglect or default is such as would (if death had not ensued) have entitled the party injured to maintain an action and recover damages in respect thereof, the party who would have been liable if death had not ensued, shall be liable to an action or suit for damages, notwithstanding the death of the person injured and although the death shall have been caused under such circumstances as amount in law to felony or other crime.
Every such action or suit shall be for the benefit of the wife, husband, parent and child, if any, of the person whose death shall have been so caused, and shall be brought by and in the name of the executor, administrator or representative of the person deceased;
and in every such action, the court may give such damages as it may think proportioned to the loss resulting from such death to the parties respectively, for whom and for whose benefit such action shall be brought, and the amount so recovered, after deducting all costs and expenses, including the costs not recovered from the defendant, shall be divided amongst the before-mentioned parties, or any of them, in such shares as the court by its judgment or decree shall direct."
22. A reading of the above provision would clearly demonstrate that when the death of a person occurs on account of a wrongful act, neglect or default, the injured party has a remedy to maintain a common law remedy under the Fatal Accident Act. It creates exception to the rule of 12 Actio personalis moritur cum persona which means cause of action dies with the person.
23. The Apex Court had an occasion to deal with the concept of tortious liability in Jayalaxmi Salt Works Private Limited's case (supra), wherein it has been held as follows:
para 7: To determine if the law stated, seemingly, so simply by the learned third Judge yet so broadly, is accurate understanding of the exhaustiveness of the expression used in Article 36 as extending to all kinds of torts it may be necessary to understand the meaning and scope of torts and the width and ambit of the expression used in Article 36. 'Tort' dictionary means 'breach of duty leading to damage'. Same meaning attaches to it in law. Salmond has defined it as, a civil wrong for which the remedy is a common law action in unliquidated damages and which is not exclusively the breach of a contract or the breach of a trust or other merely equitable obligation.
Winfield has defined toruous law arising from, breach of a duty primarily fixed by law; this duty is towards persons generally and its breach is redressable by an action for unliquidated damages. In general, torts consist of some act done without just cause or excuse. "The law of Torts exists for the purpose of preventing men from hurting one another whether in respect of their property, their presence, their reputations or anything which is theirs.' Injury and damage are two basic ingredients 13 of tort. Although these may be found in contract as well but the violations which may result in tortuous liability are breach of duty primarily fixed by the law while in contract they are fixed by the parties themselves. Further in tort the duty is towards persons generally. In contract it is towards specific person or persons. An action for tort is usually a claim for pecuniary compensation in respect of damages suffered as a result of the invasion of a legally protected interest. But law of torts being a developing law its frontiers are incapable of being strictly barricaded.
Liability in tort which in course of time has become known as 'strict liability', 'absolute liability', 'fault liability' have all gradually grown and with passage of time have become firmly entrenched. 'Absolute liability' or 'special use bringing with it increased dangers to others' Rylands v. Fletcher' (supra) and 'fault liability' are different forms which give rise to action in torts. The distance between 'strict liability' and 'fault liability' arises from presence and absence of mental element. A breach of legal duty wilfully, or deliberately or even maliciously is negligence emanating from fault liability but injury or damage resulting without any intention yet due to lack of foresight etc. is strict liability. Since duty is the primary yardstick to determine the tortuous liability its ambit keeps on widening on the touchstone of fairness, practicality of the situation etc. In Donoghue v. Stevenson (1932) AC 562 a manufacturer was held to be liable to ultimate consumer on the principle of duty to care. In Anns and Ors v. Merton London Borough Council (1978) AC 728 it was, rightly, observed, the broad general principle of liability for foreseeable damage is so widely applicable that the function of the duty of 14 care is not so much to identify cases where liability is imposed as to identify those where it is not........
Truly speaking entire law of torts is founded and structured on morality that no one has a right to injure or harm others intentionally or even innocently. Therefore, it would be primitive to class strictly or close finality the ever-expanding and growing horizon of tortuous liability. Even for social development, orderly growth of the society and cultural refineness, the liberal approach to tortuous liability by courts is more conducive.
8.In between strict liability and fault liability there may be numerous circumstances in which one may be entitled to sue for damages. And it may be partly one or the other or may be both. In a welfare society construction of dam or bundh for the sake of community is essential function and use of land or accumulation of water for the benefit of society cannot be non-
natural user. But that cannot absolve the State from its duty of being responsible to its citizens for such violations as are actionable and result in damage, loss or injury. What is fundamental is injury and not the manner in which it has been caused. 'Strict liability', 'absolute liability', 'fault liability' and 'neighbour proximity' are all refinements and development of law by English Courts for the benefit of society and the common man. Once the occasion for loss or damage is failure of duty, general or specific, the cause of action under tort arises. It may be due to negligence, nuisance, trespass, inevitable mistake etc. It may be even otherwise. In a developed or developing society the concept of duty keeps on changing and may extend to even such matters as was highlighted in Donoghue v. Stevenson (supra) where a manufacturer was 15 held responsible for injury to a consumer. They may individually or even collectively give rise to tortuous liability. Since the appellant suffered loss on facts found due to action of respondent's officers both at the stage of construction and failure to take steps even at the last moment it was liable to be compensated.
24. It is also relevant to refer to the decision of the Apex Court in Madya Pradesh Electricity Board Vs. Shail Kumari and others. (11.01.2002-SC):
MANU/SC/0020/2002, wherein, it is held as follows:
8. Even assuming that all such measures have been adopted, a person undertaking an activity involving hazardous or risky exposure to human life, is liable under law of torts to compensate for the injury suffered by any other person, irrespective of any negligence or carelessness on the part of the managers of such undertakings. The basis of such liability is the foreseeable risk inherent in the very nature of such activity.
The liability cast on such person is known, in law, as "strict liability". It differs from the liability which arises on account of the negligence or fault in this way i.e. the concept of negligence comprehends that the foreseeable harm could be avoided by taking reasonable precautions. If the defendant did all that which could be done for avoiding the harm he cannot be held liable when the action is based on any negligence attributed. But such consideration is not relevant in cases of strict liability where the defendant is held liable irrespective of whether he could have avoided the particular harm by taking precautions.
9. The doctrine of strict liability has its origin in English Common Law when it was propounded in the celebrated case of Rylands v. Fletcher 1868 LR (3) Blackburn J., the author of the said rule had observed thus in the said decision: 16
"The rule of law is that the person who, for his own purpose, brings on his lands and collects and keeps there anything likely to do mischief if it escapes, must keep it at his peril; and if he does so he is prima facie answerable for all the damage which is the natural consequence of its escape."
10. There are seven exceptions formulated by means of case law to the doctrine of strict liability. It is unnecessary to enumerate those exceptions barring one which is this. "Act of stranger i.e. if the escape was caused by the unforeseeable act of a stranger, the rule does not apply". (vide Page 535 Winfield on Tort, 15th Edn.)
11. The rule of strict liability has been approved and followed in many subsequent decisions in England. A recent decision in recognition of the said doctrine is rendered by the House of Lords in Cambridge Water Co. Ltd. v. Eastern Counties Leather Plc. 1994(1) All ELR (HL) 53. The said principle gained approval in India, and decisions of the High Courts are a legion to that effect. A Constitution Bench of this Court in Charan Lal Sahu v. Union of India : AIR 1990 SC 1480 and a Division Bench in Gujarat State Road Transport Corporation v. Ramanbhai Prabhatbhai: [1987] 3 SCR 404 had followed with approval the principle in Rylands v. Fletcher. By referring to the above two decisions a two Judge Bench of this Court has reiterated the same principle in Kaushnuma Begum v. New India Assurance Co. Ltd. MANU/SC/0002/2001 : [2001] 1 SCR 8.
12. In M.C. Mehta v. Union of India MANU/SC/0092/1986 :
[1987] 1 SCR 819 this Court has gone even beyond the rule of strict liability by holding that "where an enterprise is engaged in a hazardous or inherently dangerous activity and harm is caused on any one on account of the accident in the operation of such activity, the enterprise is strictly and absolutely liable to compensate those who are affected by the accident; such liability is not subject to any of the exceptions to the principle of strict liability under the rule in Rylands v. Fletcher. 17
25. A reading of the above two decisions of the Apex Court, it is clear that the law of tort is founded and structured on the principle of morality and also on the principles that no one has a right to injure or harm other intentionally or innocently. The dictionary meaning of the tort is breach of duty leading to damage. The tort constitutes an act done without just cause or excuses. In the process of development of refinement concept of common law liability, the principles of fault liability, strict liability, absolute liability are firmly established. The distinction between the fault liability and the strict liability is based on presence or absence of mental element. If the damages resulted without any intention, due to a lack of foresight, it falls under the strict liability. The word strict liability, absolute liability, fault liability and neighbor proximity are all refinements and development of law by English courts for the benefit of society and the common man. In the developed and developing society, the concept of duty keeps on changing and may extend to even such matters as was highlighted in Donoghue v.
stevensonson's case (supra).
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26. In strict liability, any person, who is was undertaking any activity involving hazardous or risky exposure to human life and if any untoward incident occurred on account of such activity and any other person suffered irrespective of negligence or carelessness on the part of the managers of such undertakings, such a person is liable for the reason that there is a foreseeable risk inherent in such activity.
27. If the facts in the present case are analyzed in the context of the above principles of the tortious liability the weight that was put on the barge as seen from the policy issued under Ex.A3 and the report of the Committee of P.Choudary, who was appointed to go into the mishap by One-Man Enquiry Commission through G.O.Ms.No.1049, dated 13.03.1990 and other material demonstrate that at the time of mishap, the monolithic stone was weighing 350 tonnes and 90 tonnes was the weight of the safety rods for the statute and 100 tonnes is the weight of trail, on which statute was kept, were placed on the barge.
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28. One of the participants in the bidding for allocation of the contract i.e., Urmila and Company, put condition to transport such a large quantity of weight, if the Government lay cross way from the shore to middle of the lake, but such a proposal was not accepted. The Government went on with the proposal to shift the huge monolithic statute on water. The undertaking of the project and person injured in project demonstrate that the Government was involved in the hazards or risks which has tendency to expose human life and in fact it resulted in death of ten (10) persons. All these would demonstrate that the activities carried upon by the Government with the contractor are containing lack of forcibility of risk inherently in the activities undertaken by the Government. If such activity is examined in the context of the principles laid down by the Apex Court in the case of Madya Pradesh Electricity Board vs. Shail Kumari and others falls under the strict liability.
29. The Apex Court further extended the principles of strict liability in M.C.Mehta vs. Union of India's case (supra) by accepting absolute liability theory. This theory was 20 applicable where an enterprise is engaged in hazardous and inherently dangerous activity and harm is caused on anyone on account of accident in the operation of such activity, the enterprise is strictly and absolutely liable to compensate. In Jay Laxmi Salt Works Private Limited's case (supra), the Apex Court has taken note of existence of numerous circumstances in between the strict liability and fault liability which entitled to sue for damages. It has also taken cognizance of existence of partly one or other or may be both as in the present case.
30. The activities of the contract demonstrate that no care has been taken to assess the balance after the huge weight was put on the barge. The barge was to travel nearly 1000 meters, but the mishap was occurred when the barge travelled below 100 meters. These facts demonstrate that there was a lack of care to see the maintenance of balance of barge after the weight of 450 tones was placed on the barge along with the monolithic rock steel frame work and trailer. On account of failure to maintain the balance of barge after the huge weight was put on the statute slid of and resulted in 21 sinking. The incident in this case demonstrates presence of fault theory and strict liability theory.
31. The Fatal Accident Act deals with the case of fatal death resulted from negligence or fault act, but it does not deal with the case of death resulted from no negligent liability falling under the strict liability which is without an intentional Act. The claims under the fatal accident case are based on damage on account of intentional Act. When the fatal accident is not only resulting from the fault act but also under strict liability, the application of Article 82 of the Limitation Act cannot be pressed in and the only article available is Article 113 of the Limitation Act, which is residuary provision. The concept of Actio Personalis Moritur cum persona has no relevancy in the present day since it has been changed and it underwent many changes with the development of the common law theory.
32. The learned counsel for defendant Nos.1 and 2 relied upon the decision of the Apex Court in the context of claim based on the fault theory, which is only maintainable under the Fatal Accident Act. In the said case, the Supreme Court 22 had no occasion to deal with the case in which death was not on account of any fault. The Court was dealing with death falls under the Fatal Accident Act. Therefore, the said judgment has no relevancy in the context of strict liability. This Court feels that the appropriate article applicable is Article 113, which is residual provision of article taking care of situation not covered in respect of the common law remedies for which limitation is prescribed under the Limitation Act. As seen from the Article 113, it prescribes three (03) years limitation, therefore, I hold that the compensation for death of the person in the accident is within the limitation.
33. The Court below has decreed both the suits. The plaintiffs claimed the compensation for death of the deceased as Rs.5,00,000/-. It is not seriously in dispute that the deceased was a young boy aged about 22 years. His qualification shows that he has completed intermediate and according to the evidence of PW.1, he was studying B.Tech II year, but no evidence. The plaintiffs claimed Rs.10,000/- per month towards his earning. If we look at the hire charges, which was agreed to be paid by defendant Nos.1 and 2, the 23 earning of Rs.10,000/- per month is not so high and the appropriate multiplier applied by relying upon the principles laid in dealing with the deaths in the motor accident cases and consortium granted by the Hon'ble Supreme Court, the compensation awarded by the Court below towards the death of the deceased is not so excess one and is very reasonable. Therefore, quantum of compensation fixed by the Court below for death of the deceased is confirmed.
34. The plaintiff also claimed loss of Rs.3,00,000/- towards loss of hire charges. It is a fact that two motor pumps were installed dewater the plantoon. The two pumps are owned by the plaintiffs and the value of each payment was given by the plaintiff Rs.12,500/-. Both the values come to Rs.25,000/-. The plaintiff claimed freight/hire charges on account of sinking of two motor pumps in the accident. These hire charges were claimed for three (03) years when the value of the two motor pumps is only Rs.25,000/-. If the two motor pumps are sunk in the water, the plaintiffs can claim compensation for that value of the pumps, but they claimed hire charges for three years from the date of incident. 24
35. The Court below has not considered the concept of remoteness of damages in awarding damages. This Court feels that the value of the motor pumps would be the just and proper compensation in respect of the claims damages towards loss of two pump sets. Therefore, awarding of Rs.25,000/- is just and reasonable. Accordingly, the compensation granted by the Court below is reduced from Rs.3,00,000/- to Rs.25,000/- .
Liability:
36. The contention of the learned counsel representing the insurance company is that the policy terms contained under Ex.B3 is not covered the loss of human life. According to him, the loss or damages to the subject matter, was covered under the insurance policy and the Insurance company is not liable to the human loss in the course of transit since human being are not the subject matter of insurance.
37. On the contrary, the learned counsel for the defendant Nos.1 and 2 has contended that the policy coverage was for the statute and freight only. Accordingly to him, the payment 25 of premium to the freight includes claims against the logistic operator from third party, with regard to any incident, in the course of transit of the goods given for transportation. According to him, the freight policy covers the loss of human being in the transit. Therefore, the Court below has rightly fixed the liability on the defendants, jointly and severally. Such finding does not require any interference.
38. The learned Government pleader representing the defendant No.4 has contended that the Government is not liable to pay compensation on account of two reasons. The first one the project was assigned to contractor and the terms of contract show that the contractor is liable for any loss of human beings in the execution of the work. He strictly relied upon the clause 45 of terms and conditions of the contract. It is also his contention that the policy also covers the entire liability in respect of any untoward incident in the course of execution of the project and therefore, the Government is not liable to pay any compensation.
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39. A glance of the terms and conditions of the contract, subject matter of the policy under Ex.B3, demonstrated that the policy was relating to cargo as well as the freight, which means, the insurance was taken to the statute as well as the freight. The freight term indicates the transportation of bulk goods by train, sea or air. The concept of freight insurance involves claims relating to forwarders or logistic providers liability against the claiming arising out of their mistakes or negligence in the process of transit. The policy is primarily intended to cover loss or damage to the goods, which are given for transit. It is not covered the loss of human being in the process of transit. The very object of freight is to protect the carrier from the claim relating to untoward incident resulted in damage to the cargo, which are given for transit. The said coverage is not relating to other than goods, which are given for transit. If the human beings are brought in the definition of freight, which amounts to treating the human beings as a goods. Therefore, the policy was not covered for human beings under the freight. This aspect was not considered by the Trial Court.
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40. The trial Court has given more emphasis for the words used in the terms and conditions of the policy under Ex.B3. The subject matter of the insurance was goods in transit not the human being in transit. It was not the intention of the insurance policy issued for freight. Neither the Government Pleader nor learned counsel representing for defendant Nos.1 and 2 could be able to place before this Court with regard to terms and conditions published by the IRDA relating to the insurance issued to freight coverage.
41. Therefore, this Court feels that the extending liability of the insurance Company for death of persons involved in the transit is misconceived. In this regard the findings of the trial Court required to be set aside.
42. The Trial Court also went in wrong in fixing the liability to the Government as well the insurance Company relating to claim for hire charges. It is beyond policy and Government is also not liable to the sub-contractor, who took the contract from the contractor. Any services or materials supplied by the sub-contractor to the contractor is a contract in between the 28 sub contractor and the contractor, no other persons can be fastened with liability for breach committed by contractor towards sub-contractor. Defendant Nos.1 and 2, who are the contractors and who entered into agreement with the sub contractor alone are liable. Therefore, this Court also feels that the findings of the trial Court required to be set aside.
43. It is submitted by the learned counsel for defendant No.3 - insurance company that by virtue of interim orders of this Court, defendant No.3 - insurance company had deposited 50% of the decretal amount along with costs awarded in O.S.Nos.664 and 532 of 1993 and the plaintiffs have also withdrawn the said amounts. He further submitted that by virtue of exoneration of liability of defendant No.3 - insurance company from payment of decretal amounts and costs awarded in O.S.Nos.664 and 532 of 1993, he sought refund of the said amounts.
44. As per the docket proceedings, it is evident that this Court, while granting stay, had directed defendant No.3 - insurance company to deposit 50% of the decretal amounts along with costs awarded in O.S.No.664 and 532 of 1993 and 29 also permitted the plaintiffs to withdraw the deposited amounts. In pursuance of the same, the plaintiffs have withdrawn the amounts deposited by defendant No.3. As defendant No.3 - insurance company is exonerated from its liability under these appeals, it is entitled to refund of the amount deposited by it. Such refund shall be made after amounts are deposited in respect of decretal amount in O.S.No.664 of 1993 by defendant Nos.1, 2 and 4. Insofar as recovery of deposited amount in respect of decretal amount in O.S.No.532 of 1993 is concerned, as the compensation is reduced from Rs.3,00,000/- to Rs.25,000/-, even though defendant No.3 had deposited more than Rs.25,000/- in pursuance of the interim order of this Court, in the peculiar facts and circumstances of the case, it is entitled to recover only Rs.25,000/- along with proportionate costs, from defendant Nos.1 and 2.
45. In the result, the appeals are disposed of as follows:
(i) C.C.C.A.No.59 of 2002 filed by defendant No.3 -
insurance company is allowed, setting aside the judgment of the trial Court in O.S.No.664 of 1993 to the extent of fastening the liability on defendant No.3. Consequently, defendant No.3 is exonerated from payment of compensation 30 to the plaintiffs. Therefore, defendant No.3 - insurance company is entitled to recover the amount deposited by it in pursuance of interim order of this Court in respect of decretal amount in O.S.No.664 of 1993 from defendant Nos.1, 2 and 4 or on deposit of such amounts to the suit credit by defendant Nos.1, 2 and 4.
(ii) C.C.C.A.No.60 of 2002 filed by defendant No.3 - insurance company is allowed, setting aside the judgment of the trial Court in O.S.No.532 of 1993 to the extent of fastening the liability on defendant No.3. Consequently, defendant No.3 is exonerated from payment of further compensation to the plaintiffs. As defendant No.3 had deposited 50% of the decretal amount along with proportionate costs and as the same was withdrawn by the plaintiffs, in the peculiar circumstances of the case, defendant No.3 is entitled to recover only Rs.25,000/- along with proportionate costs, from defendant Nos.1 and 2.
(iii) C.C.C.A.No.101 of 2002 filed by defendant No.4 - Government is allowed setting aside the judgment of the trial Court in O.S.No.532 of 1993 to the extent of fastening the liability on defendant No.4. Consequently, defendant No.4 is exonerated from payment of compensation to the plaintiffs.
(iv) C.C.C.A.No.178 of 2003 filed by defendant Nos.1 and 2
- contractor, is partly allowed as follows:
(a) The judgment of the trial Court in O.S.No.532 of 1993 is modified reducing the compensation amount from Rs.3,00,000/- to Rs.25,000/-.31
(b) The said compensation of Rs.25,000/- along with proportionate costs shall be paid by defendant Nos.1 and 2 to defendant No.3, as defendant No.3 had already deposited the amount in pursuance of the interim order which has already been withdrawn by the plaintiffs, or deposit the same to the credit of the suit. Such deposit shall be made within two months from the date of this judgment.
(v) C.C.C.A.No.207 of 2002 filed by defendant No.4 -
Government and C.C.C.A.No.179 of 2003 filed by defendant Nos.1 and 2 - contractor, are dismissed as follows:
(a) The judgment of the trial Court in O.S.No.664 of 1993 is confirmed to the extent of granting compensation amount of Rs.5,00,000/- along with interest and costs.
Defendant Nos.1, 2 and 4 are jointly and severally liable to pay such compensation to the plaintiffs. Such amount shall be deposited within two months from the date of this judgment.
(b) While paying the said compensation amount to the plaintiffs along with interest and costs, the amount already withdrawn by the plaintiffs, which was deposited by defendant N.3, shall be deducted and such deducted amount shall be paid to defendant No.3. There shall be no order as to costs. Miscellaneous petitions, if any pending in these appeals, shall stand closed.
______________________ JUSTICE M.LAXMAN 21.10.2022 Dua/Gms 32 THE HON'BLE SRI JUSTICE M.LAXMAN CITY CIVIL COURT APPEAL Nos.59, 60, 101, 207 of 2002;
178 and 179 of 2003 21.10.2022 Dua/Gms