Madhya Pradesh High Court
The New India Assurance Co. Ltd. vs Kamla Devi Kushwaha on 9 September, 2025
NEUTRAL CITATION NO. 2025:MPHC-JBP:46540
1 MA-3458-2023
IN THE HIGH COURT OF MADHYA PRADESH
AT JABALPUR
BEFORE
HON'BLE SHRI JUSTICE HIMANSHU JOSHI
ON THE 9 th OF SEPTEMBER, 2025
MISC. APPEAL No. 3458 of 2023
THE NEW INDIA ASSURANCE CO. LTD.
Versus
KAMLA DEVI KUSHWAHA AND OTHERS
Appearance:
Shri Krishna Keshav Singh - Advocate for the appellant.
Shri Krishan Kumar Kushwaha, learned counsel for the respondents No.1
and 2.
ORDER
The present appeal has been filed under the provision of section 173 (1) of the Motor Vehicles Act,1988 challenging the award dated 07/01/2023 passed in MACC No. 364/2022 by learned Second Member, MACT, Kotma District Anuppur (M.P.). The impugned award is being challenged on the ground of violation of the terms of condition of insurance policy in respect of license conditions.
2. For the sake of convenience, the parties shall be referred by their rank in the trial court.
3. The facts for disposal and deciding the appeal is that on the unfortunate day of 03/07/2007 at about 5:15 A.M. when the Santosh Kushwaha (deceased) driving his Dumper reached near Hanuman Mandir, Kapildhara Colliery, P.S. Bijuri, District - Anuppur (MP), suddenly, another dumper bearing registration no. MP-18-9955 being driven in a rash and negligent manner by Respondent no. 4 had dashed the dumper driven by deceased which resulted into various injuries and Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 2 MA-3458-2023 subsequently died. The matter was reported to the police and an FIR was registered. After the investigation, the charge sheet in the matter was submitted and Criminal Case No.1144/2007 (State Vs. Vijay Tiwari) was registered before the learned trial court.
4. In the meantime, the legal representatives of the deceased had preferred a claim petition before the Learned Second Motor Accident Claim Tribunal, Kotama, District - Anuppur (M.P.). The trial was set into motion and after evaluating the ocular as well as documentary evidence, the Tribunal vide order dated 07/01/2023 has partly allowed the claim petition and awarded Rs.13,24,000/- as compensation. The Insurance Company has preferred the present Miscellaneous Appeal challenging the award on two grounds, firstly, that the accident occurred due to head-on collision between the two dumpers, therefore, the case of contributory negligence is made out and secondly, there was non existence of valid driving license with the driver of offending vehicle and therefore, the insurance company is not liable to pay the compensation due to violation of the terms of the insurance policy.
5. Earlier, claim petition filed by the claimant was decided ex parte against respondents no. 1 and 2 vide award dated 14/07/2009. However, the respondent no. 2 has filed an application Under Order 9 rule 13 of the Code of Civil Procedure for setting aside ex-parte award upon which MJC No.371 of 2015 was registered and after hearing the parties, the Tribunal vide its order dated 27/08/2022, set aside the award dated 14/07/2009 and after providing opportunity of hearing to all the parties, the award under challenge dated 07/01/2023 has been passed.
6. The Learned counsel for the Insurance company submits that at the time of accident, deceased was himself driving dumper and the accident caused due to Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 3 MA-3458-2023 head-on-collusion between the dumper driven by deceased and respondent no.4. The main bone of contention of the learned counsel for the Insurance company is that though the Tribunal has rightly come to conclusion that the driver of offending vehicle was not having any valid license to drive and driving the vehicle with fake driving license even then, the tribunal held that the insurance company is liable to pay compensation amount wrongly observing that it was the obligation of the Insurance Company to prove that the owner of the vehicle in question while engaging the driver had shown negligence in keeping such driver and should have looked into the veracity of the driving license. Reliance has been placed upon National Insurance Company Limited Vs. Swarn Singh & Others, reported in 2004 SCC 297. The insurance company has also raised grounds that the learned Motor Accident Claim Tribunal has erred in allowing the application for setting aside the ex-parte award. It was contended that the award amount has been wrongly challenged in the second round of litigation.
7. Learned counsel for the respondent/claimant has submitted that the award of the learned Tribunal is just and proper and there is no need of any interference by this Court. He submitted that the learned Tribunal has calculated the quantum on the basis of the principles laid down in the various judgments of the Hon'ble Apex Court and, therefore, there is no need for interference of this Court in the impugned judgment and award. Even on the point of negligence, the learned Tribunal has relied upon the oral and documentary evidence produced before it and came to the conclusion that the driver of the offending vehicle was negligent in driving the vehicle. In a nutshell, he submitted that the impugned judgment and award is just and proper and does not require any interference.
8. I have carefully heard Shri Krishna Keshav Singh, learned counsel for Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 4 MA-3458-2023 the claimant and Shri Krishan Kumar Kushwaha counsel for the Insurance Company. I have also perused the impugned order along with the record of the case and the judgment applicable in the facts of the present case.
9. As far as the accident is concerned, the Tribunal has framed issue no.1. The claimant has examined herself as wife of the deceased. The accident was found to be proved by the tribunal, and the non appellant no. 1- driver has not tried to prove it contrary. All the documents regarding rash and negligent driving were produced along with charge sheet and they were exhibited before the Tribunal. The Tribunal after evaluating these documents and upon considering the testimony of PW-1 Kamla Devi has come to conclusion that the accident took place and found issue no. 1 to be proved.
10. The issue no. 2 is regarding violation of the terms of the insurance policy. The Insurance company has tried to prove issue no. 2 in their favour by documentary evidence as well as by oral evidence of DW-1 Jitendra Singh, Clerk- The New India Insurance Company Limited who has disclosed in his testimony that the license of Driver Vijay Kumar Tiwari was duly investigated by Mohammad Ibrahim through RTO office, Raipur and documents under Exhibit D/1 was exhibited to prove that the license produced by the driver of the offending vehicle is forged and the same has not been issued by RTO Office, Raipur. Resultantly, it is found proved that although the offending vehicle was insured with the insurance company but the same was being driven in violation of terms and conditions of the Policy. But, The learned MACT has held that the insurance company is also required to prove that the owner of the offending vehicle had knowledge regarding invalid license of the driver while keeping him in service and this fact has not been proved by the insurance company.
11. The Learned Tribunal vide order dated 08/02/2010 has partly allowed Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 5 MA-3458-2023 the claim petition and has found the Driver, Owner and Insurance Company jointly and severally liable to pay the compensation amount and therefore, directed the insurance company to pay the compensation amount. The claimants have not preferred any appeal for enhancement of the claim amount. Therefore, no question arises for deciding the quantum of the claim amount.
12. The decision of the Apex Court in case of National Insurance Company Limited Vs. Parvathneni & Others (decided on 31/08/2009) has been referred wherein the issue pertaining to awarding compensation on the principle of Pay and Recover by the Tribunal was under consideration. Another limb of the argument of the counsel for the Insurance Company is that the matter is pertaining to head-on-collision and therefore it falls under the category of contributory negligence. On the above grounds, it is urged that appeal filed by the insurance company be allowed, impugned award be set aside and Insurance company be exonerated from its liability to pay the compensation amount.
13. The sole question raised by the Insurance Company is once the license is found to be forged then in such condition the insurance company is not liable to pay the compensation amount.
14. In the facts and circumstances of the present case, it is observed that the learned MACT has not issued any direction of pay and recover from the driver and owner. In this context, at this stage it would be fruitful to refer the following decisions of the Hon'ble Supreme Court :
In the case of Shamanna v. Oriental Insurance Co. Ltd., (2018) 9 SCC 650 , it is held in paragraphs 12 to 14 as under:
" 12. The above reference in Parvathneni case [National Insurance Co. Ltd. v. Parvathneni, (2009) 8 SCC 785 : (2009) 3 SCC (Civ) 568 : (2009) 3 SCC (Cri) 943] has been disposed of on 17-9-2013 [National Insurance Co. Ltd. v. Parvathneni, (2018) 9 SCC 657] by the three-Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18
NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 6 MA-3458-2023 Judge Bench keeping the questions of law open to be decided in an appropriate case.
13. Since the reference to the larger Bench in Parvathneni case [National Insurance Co. Ltd. v. Parvathneni, (2009) 8 SCC 785 :
(2009) 3 SCC (Civ) 568 : (2009) 3 SCC (Cri) 943] has been disposed of by keeping the questions of law open to be decided in an appropriate case, presently the decision in Swaran Singh case [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] followed in Laxmi Narain Dhut [National Insurance Co. Ltd. v. Laxmi Narain Dhut, (2007) 3 SCC 700 : (2007) 2 SCC (Cri) 142] and other cases hold the field. The award passed by the Tribunal directing the insurance company to pay the compensation amount awarded to the claimants and thereafter, recover the same from the owner of the vehicle in question, is in accordance with the judgment passed by this Court in Swaran Singh [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] and Laxmi Narain Dhut [National Insurance Co. Ltd. v. Laxmi Narain Dhut, (2007) 3 SCC 700 : (2007) 2 SCC (Cri) 142] cases. While so, in our view, the High Court ought not to have interfered with the award passed by the Tribunal directing the first respondent to pay and recover from the owner of the vehicle. The impugned judgment [Shamanna v. Laxman, 2016 SCC OnLine Kar 6928] of the High Court exonerating the insurance company from its liability and directing the claimants to recover the compensation from the owner of the vehicle is set aside and the award passed by the Tribunal is restored.
14. So far as the recovery of the amount from the owner of the vehicle, the insurance company shall recover as held in the decision in Oriental Insurance Co. Ltd. v. Nanjappan [Oriental Insurance Co. Ltd. v. Nanjappan, (2004) 13 SCC 224 : 2005 SCC (Cri) 148] wherein this Court held that : (SCC p. 226, para 8) "8. ... For the purpose of recovering the same from the insured, the insurer shall not be required to file a suit. It may initiate a proceeding before the executing court concerned as if the dispute between the insurer and the owner was the subject-matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer."
15. In the case of Manuara Khatun v. Rajesh Kr. Singh, (2017) 4 SCC 796, it is held in paragraphs 11 to 16 as under:
"11. In reply, the learned counsel for the respondents (insurance companies) supported the impugned order and contended that no case is made out to interfere in the impugned judgment. It was his submission that once it is held and rightly that the insurance company is not liable because the victims were travelling in the offending vehicle as "gratuitous passengers", there did not arise any occasion to pay Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 7 MA-3458-2023 the awarded sum to the claimants by the insurance company and nor the principle "pay and recover"
could be applied against the insurance company in such circumstances thereby making them liable to pay the awarded sum to the claimants.
1 2 . Having heard the learned counsel for the parties and on perusal of the record of the case, we find force in the submission of the learned counsel for the appellants (claimants).
13. The only question, which arises for consideration in these appeals, is whether the appellants are entitled for an order against the insurer of the offending vehicle i.e. Respondent 1 to pay the awarded sum to the appellants and then to recover the undefined said amount from the insured (owner of the offending vehicle ) Respondent 1 in the same proceedings.
14. The aforesaid question, in opinion of this court, remains no more res integra. As notice above, it was the subject-matter of several decisions of this Court rendered by three-Judge Bench and two-Judge Bench in the past viz. National Insurance Co. Ltd. v. Baljit Kaur, (2004) 2 SCC 1 : 2004 SCC (Cri) 370] , National Insurance Co. Ltd. v. Challa Upendra Rao [National Insurance Co. Ltd. v. Challa Upendra Rao, (2004) 8 SCC 517 : 2005 SCC (Cri) 357] , National Insurance Co. Ltd. v. Kaushalaya Devi [National Insurance Co. Ltd. v. Kaushalaya Devi, (2008) 8 SCC 246 : (2008) 3 SCC (Cri) 467] , National Insurance Co. v. Roshan Lal [National Insurance Co. Ltd. v. Roshan Lal, (2017) 4 SCC 803] and National Insurance Co. Ltd. v. Parvathneni [National Insurance Co. Ltd. v. Parvathneni, (2009) 8 SCC 785 : (2009) 3 SCC (Civ) 568 : (2009) 3 SCC (Cri) 943] .
15. This question also fell for consideration recently i n National Insurance Co. Ltd. v. Saju P. Paul [National Insurance Co. Ltd. v. Saju P. Paul, (2013) 2 Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 8 MA-3458-2023 SCC 41 wherein this Court took note of entire previous case law on the subject mentioned above and examined the question in the context of Section 147 of the Act. While allowing the appeal filed by the insurance company by reversing the judgment [Saju P. Paul v. National Insurance Co., 2011 SCC OnLine Ker 3791 : 2012 ACJ 1852] of the High Court, it was held on facts that since the victim was travelling in offending vehicle as "gratuitous passenger" undefined and hence, the insurance company cannot be held liable to suffer the liability arising out of accident on the strength of the insurance policy. However, this Court keeping in view the benevolent object of the Act and other relevant factors arising in the case, issued the directions against the insurance company to pay the awarded sum to the claimants and then to recover the said sum from the insured in the same proceedings by applying the principle of "pay and recover".
16. Justice R.M. Lodha (as His Lordship then was and later became CJI) speaking for the Bench held in paras 20 and 26 as under:
"20. The next question that arises for consideration is whether in the peculiar facts of this case a direction could be issued to the Insurance Company to first satisfy the awarded amount in favour of the claimant and recover the same from the owner of the vehicle (Respondent 2 herein).
26. The pendency of consideration of the above questions by a larger Bench does not mean that the course that was followed in Baljit Kaur, (2004) 2 SCC 1 and Challa Upendra Rao, (2004) 8 SCC 517 should not be followed, more so in a peculiar fact situation of this case. In the present case, the accident occurred in 1993. At that time, the claimant was 28 years old. He is now about 48 years. The claimant was a driver on heavy vehicle and due to the accident he has been rendered permanently disabled. He has not been able to get compensation so far due to the stay order passed by this Court."Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18
NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 9 MA-3458-2023
16. The aforesaid question, in opinion of this court, remains no more res integra. As noticed above, it was the subject-matter of several decisions of this Court rendered by three-Judge Bench and two-Judge Bench in the past viz. National Insurance Co. Ltd. v. Baljit Kaur [National Insurance Co. Ltd. v. Baljit Kaur, (2004) 2 SCC 1 : 2004 SCC (Cri) 370] , National Insurance Co. Ltd. v. Challa Upendra Rao [National Insurance Co. Ltd. v. Challa Upendra Rao, (2004) 8 SCC 517 : 2005 SCC (Cri) 357] , National Insurance Co. Ltd. v. Kaushalaya Devi [National Insurance Co. Ltd. v. Kaushalaya Devi, (2008) 8 SCC 246 : (2008) 3 SCC (Cri) 467] , National Insurance Co. v. Roshan Lal [National Insurance Co. Ltd. v. Roshan Lal, (2017) 4 SCC 803] and National Insurance Co. Ltd. v. Parvathneni [National Insurance Co. Ltd. v. Parvathneni, (2009) 8 SCC 785 :
(2009) 3 SCC (Civ) 568 : (2009) 3 SCC (Cri) 943].
17. This question also fell for consideration recently in National Insurance Co. Ltd. v. Saju P. Paul [National Insurance Co. Ltd. v. Saju P. Paul, (2013) 2 SCC 41 wherein this Court took note of entire previous case law on the subject mentioned above and examined the question in the context of Section 147 of the Act. While allowing the appeal filed by the insurance company by reversing the judgment [Saju P. Paul v. National Insurance Co., 2011 SCC OnLine Ker 3791 :
2012 ACJ 1852] of the High Court, it was held on facts that since the victim was travelling in offending vehicle as "gratuitous passenger" undefined and hence, the insurance company cannot be held liable to suffer the liability arising out of accident on the strength of the insurance policy. However, this Court keeping in view the benevolent object of the Act and other relevant factors arising in the case, issued the directions against the insurance company to pay the awarded sum to the claimants and then to recover the said sum from the insured in the same proceedings by applying the principle of "pay and recover".Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18
NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 10 MA-3458-2023
18. In the matter of National Insurance Co. Ltd. v. Saju P. Paul, (2013) 2 SCC 41 it has been held as under:
"20. The next question that arises for consideration is whether in the peculiar facts of this case a direction could be issued to the Insurance Company to first satisfy the awarded amount in favour of the claimant and recover the same from the owner of the vehicle (Respondent 2 herein).
***
19. The pendency of consideration of the above questions by a larger Bench does not mean that the course that was followed in Baljit Kaur titled National Insurance Co. Ltd. v. Baljit Kaur, (2004) 2 SCC 1 and Challa Upendra Rao National Insurance Co. Ltd. v. Challa Upendra Rao, (2004) 8 SCC 517 should not be followed, more so in a peculiar fact situation of this case. The insurance company to pay the awarded amount to the claimants and recover the said amount from the owner in the same proceedings by applying the principle of "pay and recover". The recovery of the amount by the Insurance Company from the owner shall be made by following the procedure as laid down by this Court in Challa Upendra Rao National Insurance Co. Ltd. v. Challa Upendra Rao, (2004) 8 SCC 517."
20. Hence, in view of the above discussion, this appeal filed by the insurance company is allowed to the extent as indicated above.
Ordered accordingly.
(HIMANSHU JOSHI) JUDGE Jasleen Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18 NEUTRAL CITATION NO. 2025:MPHC-JBP:46540 11 MA-3458-2023 Signature Not Verified Signed by: JASLEEN SINGH SALUJA Signing time: 26-09-2025 16:43:18