Madras High Court
M/S.United Indian Insurance vs M.Periyasamy ... 1St on 7 August, 2008
Author: A.Selvam
Bench: A.Selvam
BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 07/08/2008 CORAM THE HONOURABLE MR.JUSTICE A.SELVAM Civil Miscellaneous Appeal No.884 of 2002 M/s.United Indian Insurance Company Limited, Rural Branch Seethalakshmi Complex, Thirunagar, Madurai-625 006. ... Appellant/ II Opposite Party Vs. 1.M.Periyasamy ... 1st respondent/ Applicant 2.V.Rajasekaran (Ex-parte in the lower Court) ... 2nd respondent/ I Opposite Party Civil miscellaneous appeal has been filed under Section 30 of the Workmen Compensation Act, against the award dated 06.02.2002 passed in W.C.No.346 of 2000 by the Commissioner for Workmen Compensation (Deputy Commissioner for Labour), Madurai. !For appellant ... Mr.R.Srinivasan ^For 1st respondent ... Mr.C.Godwin :JUDGMENT
This civil miscellaneous appeal has been preferred against the order passed in W.C.No.346 of 2000 by the Court of Commissioner for Workmen Compensation, Madurai.
2.The first respondent herein as applicant has filed the application and the same has been taken on file in W.C.No.346 of 2000 on the file of the Court of Commissioner for Workmen Compensation, Madurai, wherein the present appellant has been shown as second opposite party and the second respondent herein has been shown as first opposite party.
3.It is stated in the petition that the accident has taken place near Nakkalapatti Chamber, Madurai District on 13.09.2000 at about 11.00 a.m. The applicant has been working under the opposite party No.I as a driver of the TATA Sumo Car bearing Registration No.TN-57-B-4077 and he has driven the same from Thottappanaikanoor to Usilampatti. The said vehicle has been insured with the opposite party No.II. The applicant has driven TATA Sumo Car with due care and caution, and on the extreme left side of the road and at the time a car bearing Registration No.TN-09-P-3939 has come from opposite side and the driver of the said car has driven the same in rash and negligent manner and dashed against the car bearing Registration No.TN-57-B-4077 and due to accident, the applicant has sustained grievous injuries and he has been taken to Rajaji Government Hospital, Madurai. The opposite party No.I is the master of the applicant and the car bearing Registration No.TN-57-B-4077 has been insured with the opposite party No.II. The petitioner has earned monthly salary of Rs.3,300/- . Under the said circumstances, the petitioner has claimed Rs.4,23,146/- by way of compensation.
4.In the objection filed on the side of the second opposite party, it has been stated that it is false to say that the applicant has sustained injuries due to accident. The applicant claimed excessive compensation. Further it is stated that on the date of accident, one Muthukumar has insured the vehicle which involved in the accident and the first opposite party is the employer of the applicant and there is no contract between the second opposite party and the first opposite party so as to indemnify the loss and therefore, the application is liable to be dismissed.
5.The Court of Commissioner for Workmen Compensation, Madurai after hearing both sides and upon perusing the relevant records, has come to the conclusion that the applicant is entitled to get Rs.89,699/- by way of compensation and directed the second opposite party to give the same within thirty days, failing which the second opposite party is liable to pay 12% interest per annum. Against the order passed by the Court of Commissioner for Workmen Compensation, Madurai, the present civil miscellaneous appeal has been preferred.
6.The learned counsel appearing for the appellant/second opposite party has laconically contended that the vehicle which involved in the accident has been insured in the name of one Muthukumar for the period from 12.01.2000 to 11.01.2001 and the accident has happened on 13.09.2000 and the insurance policy has been transferred in the name of the first opposite party viz., Rajasekaran only on 19.09.2000. Therefore, on the date of accident, there is no relationship of employee and employer between the applicant and the said Muthukumar, but the Court of Commissioner for Workmen Compensation, Madurai has failed to look into above aspect and therefore, the impugned order passed by the Court of Commissioner for Workmen Compensation, Madurai is liable to be dismissed.
7.Per contra, the learned counsel appearing for the first respondent/applicant has also equally contended that the second respondent/first opposite party has purchased the vehicle which involved in the accident from the original owner viz., Muthukumar and the policy has been transferred in his name on 19.09.2000 and as per Section 157 of the Motor Vehicles Act, 1988 the appellant/second opposite party is liable to pay compensation to the first respondent/applicant and under the said circumstances, the impugned order passed by the Court of Commissioner for Workmen Compensation, Madurai is perfectly correct and the same needs no interference.
8.On the basis of rival submissions made by either counsel, the Court has to decide as to whether the appellant/second opposite party is liable to pay compensation to the first respondent/applicant.
9.It is an admitted fact that the vehicle which involved in the accident has been insured in the name of Muthukumar for the period from 12.01.2000 to 11.01.2001 and the alleged accident has happened on 13.09.2000 and though the first opposite party viz., Rajasekaran has purchased the vehicle before the date of accident, the insurance policy has been transferred in his name only on 19.09.2000. Therefore, on the date of accident, the insurance policy has stood only in the name of Muthukumar and there is no privity of contract between the said Muthukumar and first respondent/applicant on the date of accident i.e., on 13.09.2000.
10.The learned counsel appearing for the first respondent/applicant has solely based his argument as per the provision of Section 157 of the Motor Vehicles Act, 1988 and the same reads as follows;
"(1)Where a person in whose favour the certificate of insurance has been issued in accordance with the provisions of this Chapter transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.
Explanation - For the removal of doubts, it is hereby declared that such deemed transfer shall include transfer of rights and liabilities of the said certificate of insurance and policy of insurance.
(2)The transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the fact of transfer in the certificate of insurance and the policy described in the certificate in his favour and the insurer shall make the necessary changes in the certificate and the policy of insurance in regard to the transfer of insurance."
11.From the close reading of the provision of Section 157 of the Motor Vehicles Act, 1988, it is made clear that a person in whose favour the certificate of insurance has been issued, transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.
12.In the instant case, as stated earlier, the accident has taken place on 13.09.2000 and on the date of accident, the policy of insurance stands in the name of one Muthukumar and only on 19.09.2000 the police of insurance has been transferred in the name of the first opposite party viz., Rajasekaran.
13.In order to controvert the argument advanced by the learned counsel appearing for the first respondent/applicant, the learned counsel appearing for the appellant/second opposite party has meticulously drawn the attention of the Court to the following decisions;
a)In AIR 1996 Supreme Court 586 (M/s.Complete Insulations (P) Ltd., Vs. New Indian Assurance Company Ltd.,) the Full Bench of the Honourable Supreme Court has held that the liability of insurance company under Section 157 is limited to third party risks only. Transferee cannot be said to be third party qua the vehicle. Insurer would not be liable to make good the damage to the vehicle.
b)In AIR 2003 Supreme Court 1446 (Rikhi Ram and another Vs. Smt.Sukhrania and others) wherein also the Full Bench of the Honourable Supreme Court has held that as per Section 103-A of the Motor Vehicles Act, 1939, liability of insurance company does not cease in the absence of intimation of transfer of vehicle to insurance company with regard to third party risks.
14.From the conjoint reading of the decisions referred to earlier, it is made clear to the Court that Section 157 of the Motor Vehicles Act, 1988, would apply only to third party risks and the same is not applicable to the facts of the present case.
15.The learned counsel appearing for the first respondent/applicant has also drawn the attention of the Court to the following decisions;
i)The first and foremost decision is reported in 2008(1) TAC 782 (Karnadaka) (United Indian Assurance Co. Ltd., Mysore Vs. M.N.Ravikumar and others) wherein it has been clearly stated that Section 157 of the Motor Vehicles Act, 1988, would be applicable only to third party concerned.
ii)The second decision is reported in 2006 ACJ 1544 (A.Manickam Vs. Raju and others) wherein the Division Bench of this Court has held that owner of vehicle contended that he had transferred the vehicle a few years prior to the date of accident but he continued to pay the insurance premium. Insurance Company has also not explained why it continued to renew the policy and received premium long after the date of transfer. Under the said circumstances, the insurance company is held liable.
iii) The third decision is reported in AIR 1999 Supreme Court 1398 (G.Govindan Vs. New Indian Assurance Co. Ltd., and others) wherein also the Honourable Supreme Court has held that both under the old Act and under the new Act the Legislature was anxious to protect the third party (victim) interest. What was implicit in the provisions of the old Act is now made explicit. The provisions under the new Act and the old Act are substantially the same in relation to liability in regard to third party.
16.From the close reading of the decisions relied upon by the learned counsel appearing for the first respondent/applicant, it is needless to say that the provision of Section 157 of the Motor Vehicles Act, 1988 would apply only in the case of third party risk.
17.In the instant case, as noted down in many places that on the date of accident i.e., 13.09.2000 the insurance policy stands in the name of one Muthukumar and further there is no privity of contract between the said Muthukumar and first respondent/ applicant on the date of occurrence. In short, the first respondent/applicant has not served as an employee under the said Muthukumar on 13.09.2000, the date of accident. Since there is no privity of contract between the first respondent/applicant and the said Muthukumar, on the date of accident, the insurance company viz., appellant/second opposite party is not legally liable to pay compensation to the first respondent/applicant as per the provisions of Section 157 of the Motor Vehicles Act, 1988 since the same is applicable only to third party and not in respect of the parties who are having contractual relationship. Therefore the argument advanced by the learned counsel appearing for the appellant/second opposite party is really having subsisting force and whereas the argument advanced by the learned counsel appearing for the first respondent/applicant is sans merit.
18.The Court of Commissioner for Workmen Compensation, Madurai, without considering the applicability of Section 157 of the Motor Vehicles Act, 1988, in the present case, has erroneously come to the conclusion that the said provision is applicable to the present case. In view of the discussion made earlier, it is very clear that the finding given by the Court of Commissioner for Workmen Compensation Act, Madurai is totally against law and the same requires interference.
19.The first respondent/applicant has claimed compensation against the first and second opposite parties. The Insurance company has been shown as second opposite party. It has already been stated that the Insurance Company viz., appellant herein is not liable to pay compensation to the first respondent/ applicant. Under the said circumstances, the first opposite party viz., Rajasekaran is liable to pay compensation fixed by the Court of Commissioner for Workmen Compensation, Madurai.
20.In fine, this civil miscellaneous appeal is allowed without costs. The impugned order passed in W.C.No.346 of 2000 against the appellant/second opposite party is set aside. The second respondent/first opposite party viz., Rajasekaran is liable to pay the quantum of compensation fixed in W.C.No.346 of 2000 to the first respondent/applicant.
gcg To
1.The Commissioner, (for Workmen Compensation), Madurai.