Karnataka High Court
Branch Manager vs Channappa on 12 February, 2020
Author: B.Veerappa
Bench: B. Veerappa
1
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 12TH DAY OF FEBRUARY, 2020
BEFORE
THE HON' BLE MR. JUSTICE B. VEERAPPA
M.F.A. No.1183/2010 (MV)
C/W
M.F.A.Nos.1176/2010, 1177/2010, 1178/2010,
1179/2010, 1181/2010, 1182/2010 AND 1184/2010
(MV)
M.F.A. No.1183/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. CHANNAPPA
S/O BAGADAPPA
NOW AGED ABOUT 31 YEARS
OCC:AGRICULTURE
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
2
2. T M VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
...RESPONDENTS
(BY SRI.KO. VIJAYAKUMAR, ADV. FOR R2-ABSENT
R1 IS SERVED BUT UNREPRESENTED)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.51/2007 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.6,000/- WITH INTEREST AT 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
M.F.A. No.1176/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. PRAKASH
S/O LATE GUNDIGENAHALLI
THIPPESEAMY
NOW AGED ABOUT 24 YEARS
OCC:AGRICULTURE
3
2. VISHALAKSHI
D/O LATE GUNDIGENAHALLI
THIPPESWAMY
NOW AGED ABOUT 19 YEARS
3. KOMALA
D/O LATE GUNDIGENAHALLI
THIPPESWAMY
NOW AGED ABOUT 15 YEARS
SINCE MINOR REPRESENTED
NATURAL GUARDIAN/BROTHER
PRAKASH THE 1ST RESPONDENT HEREIN
ALL R/O KONASAGARA VILLAGE
MOLAKALMUARU TALUK
4. T M VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMUARU TALUK
...RESPONDENTS
(BY MS.SHRUTI PHONDE, ADV. FOR
SRI H KANTHARAJA, ADV. FOR R1 & R2
BY SRI.KO. VIJAYAKUMAR, ADV. FOR R2-ABSENT
R3 IS MINOR, REP. BY R1)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.120/2006 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.3,15,000/- WITH INTEREST AT 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
M.F.A. No.1177/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
4
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. T. PRAKASH
S/O LATE GUNDIGENAHALLI THIPPESEAMY
NOW AGED ABOUT 24 YEARS
OCC:AGRICULTURE
2. VISHALAKSHI
D/O LATE GUNDIGENAHALLI THIPPESWAMY
NOW AGED ABOUT 19 YEARS
3. KOMALA
D/O LATE GUNDIGENAHALLI THIPPESWAMY
NOW AGED ABOUT 15 YEARS
SINCE MINOR REPRESENTED
NATURAL GUARDIAN/BROTHER
PRAKASH THE 1ST RESPONDENT HEREIN
ALL R/O KONASAGARA VILLAGE
MOLAKALMUARU TALUK
CHITRADURGA DISTRICT.
4. T M VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMUARU TALUK.
...RESPONDENTS
(BY MS.SHRUTI PHONDE, ADV. FOR
SRI H KANTHARAJA, ADV. FOR R1 & R2
R3 IS MINOR, REP. BY R1
R4 IS SERVED BUT UNREPRESENTED)
5
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.121/2006 ON THE FILE OF THE CIVIL
JUDGE (SR.DN.), CHALLAKERE, AWARDING A COMPENSATION
OF RS.3,61,000/- WITH INTEREST @ 6% P.A. FROM THE DATE
OF PETITION TILL DEPOSIT.
M.F.A. No.1178/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. SMT. SHANKARAMMA
W/O LATE H PRAKASH
NOW AGED ABOUT 26 YEARS
OCC: HOUSEHOLD WORK
2. SMT HONNAMMA
W/O LATE HANUMANTHAPPA
NOW AGED ABOUT 59 YEARS
OCC:AGRICULTURE
BOTH ARE R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
6
3. T M VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
...RESPONDENTS
(BY SRI. KO. VIJAYAKUMAR, ADV. FOR R3
R1 & R2 SERVED BUT UNREPRESENTED)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.122/2006 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.4,11,000/- WITH INTEREST AT 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
M.F.A. No.1179/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. PRAKASH
S/O LATE GUNDIGENAHALLI THIPPESEAMY
NOW AGED ABOUT 24 YEARS
OCC:AGRICULTURE
7
2. VISHALAKSHI
D/O LATE GUNDIGENAHALLI THIPPESWAMY
NOW AGED ABOUT 19 YEARS
3. KOMALA
D/O LATE GUNDIGENAHALLI THIPPESWAMY
NOW AGED ABOUT 15 YEARS
SINCE MINOR REPRESENTED
NATURAL GUARDIAN/BROTHER
PRAKASH THE 1ST RESPONDENT HEREIN
ALL R/O KONASAGARA VILLAGE
MOLAKALMUARU TALUK.
4. T M VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMUARU TALUK.
...RESPONDENTS
(BY MS.SHRUTI PHONDE, ADV. FOR
SRI H KANTHARAJA, ADV. FOR R1
SRI B PROMOD, ADV. FOR R4
R3 IS MINOR, REP. BY R1
R2 IS SERVED BUT UNREPRESENTED)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.123/2006 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.1,80,000/- WITH INTEREST AT 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
M.F.A. No.1181/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
SHARADA COMPLEX
8
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. P.S.THIPPESWAMY S/O PAPANNA
NOW AGED ABOUT 54 YEARS
OCC:AGRICULTURE
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK
CHITRADURGA DISTRICT.
2. T.M.VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
...RESPONDENTS
(R1 AND R2 ARE SERVED BUT UNREPRESENTED)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.49/2007 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.3,000/- WITH INTEREST @ 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
M.F.A. No.1182/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
OPP.KSRTC BUS STAND
9
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. SANNABOMMAIAH @
SANNA BOMMANNA
S/O PAMULAIAH
NOW AGED ABOUT 39 YEARS
OCC:AGRICULTURE
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
2. T.M.VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
...RESPONDENTS
(R1 AND R2 ARE SERVED BUT UNREPRESENTED)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.50/2007 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.3,000/- WITH INTEREST @ 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
M.F.A. No.1184/2010
BETWEEN:
BRANCH MANAGER
ORIENTAL INSURANCE CO. LTD.,
BRANCH OFFICE
10
OPP.KSRTC BUS STAND
SHARADA COMPLEX
CHITRADURGA
NOW REPRESENTED BY
ITS REGIONAL MANAGER
REGIONAL OFFICE
#44/45, LEO SHOPPING COMPLEX
RESIDENCY ROAD
BANGALORE-560 025.
...APPELLANT
(BY SRI. A N KRISHNA SWAMY, ADV.)
AND:
1. SHIVANNA
S/O CHANNABASAPPA
NOW AGED ABOUT 38 YEARS
OCC:AGRICULTURE
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
2. T M VIJAYAKUMAR
S/O T MANJUNATH
NOW AGED ABOUT 44 YEARS
R/O KONASAGARA VILLAGE
MOLAKALMURU TALUK.
...RESPONDENTS
(BY SRI. KO. VIJAYAKUMAR, ADV. FOR R2-ABSENT
R1 IS SERVED BUT UNREPRESENTED)
THIS M.F.A. IS FILED UNDER SECTION 173 (1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 07.10.2009
PASSED IN MVC NO.52/2007 ON THE FILE OF CIVIL JUDGE
(SR.DN.), CHALLAKERE, AWARDING A COMPENSATION OF
RS.6,000/- WITH INTEREST @ 6% P.A. FROM THE DATE OF
PETITION TILL DEPOSIT.
THESE M.F.A.s ARE COMING ON FOR HEARING, THIS
DAY, THE COURT MADE THE FOLLOWING:
11
COMMON JUDGMENT
In all these appeals the Insurance Company is assailing the common judgment and award dated 07.10.2009 made in MVC Nos.51/2007, 120/2006, 121/2006, 122/2006, 123/2006, 49/2007, 50/2007 and 52/2007 on the file of Civil Judge (Senior Division), Challakere, awarding total compensation of Rs.6,000/-, Rs.3,15,000/-, Rs.3,61,000/-, Rs.4,11,000/-, Rs.1,80,000/-, Rs.3,000/-, Rs.3,000/- and Rs.6,000/- respectively, as a result of death of four persons and injuries in respect of four persons.
2. The legal representatives of deceased four persons and the injured claimants filed the claim petitions stated supra before the Civil Judge (Senior Division), Challakere, contending that on 11.07.2006, all the injured claimants and the deceased persons were proceeding towards Bellary, when they were passing near Kammanapatti Village in Tempo Trax bearing 12 Registration No.KA-16/M-1462 in order to go to Bellary VIMS Hospital on S.H.No.19, Molakalmuru Taluk, at about 11.00 p.m. the driver of the Tempo Trax drove the vehicle in a rash and negligent manner so as to endanger human life without following the traffic rules dashed to right side hind portion of on going tipper lorry bearing Reg.No.MP-19/D-9427 and caused the accident. As a result four inmates died on the spot and four persons were injured. The injured persons were admitted to VIMS Hospital and later shifted to Molakalmuru Primary Health Centre. The legal representatives of the deceased persons contended that the deceased persons were hale and healthy and were doing agricultural work and also doing weaving work. The injured claimants were doing agricultural work and used to earn Rs.15,000/- per month. Therefore, they sought to allow the claim petitions. 13
3. In response to the notice issued the 1st respondent being the owner of the vehicle resisted the petition filed objections denying all the allegations and contended that the vehicle belongs to him, insured with the 2nd respondent and that the driver of the Tempo Trax was having valid licence and the policy was in force. Therefore, he sought to dismiss the petition as he is not liable to pay the compensation.
4. The 2nd respondent - Insurance Company contended that the very claim petitions are not maintainable. The accident occurred due to negligence on the part of the driver of the Tipper Lorry bearing Reg.No.MP-19/D-9427. The age, occupation, income of the deceased and injured claimants are denied. The further contention is that the driver of the Tempo Trax was not holding valid and effective driving licence as on the date of the accident and that the said accident occurred due to the contributory negligence on the part 14 of the driver of the Tempo Trax and sought to dismiss the claim petitions.
5. Based on the aforesaid pleadings the Tribunal framed the issues separately and the claimants were examined as PWs.1 to 9, to substantiate their case they marked the documents Exs.P1 to P27. Respondent examined RW.1 and got marked Ex.R.1 - the Insurance Policy.
6. The Tribunal considering both oral and documentary evidence on record, recorded a finding that the claimants proved that 4 persons died and other persons were injured, as a result of the accident that occurred on 11.07.2006 on account of rash and negligent driving by the driver of the Tempo Trax bearing Reg.No.KA-16/M-1462. The 2nd respondent - Insurance Company has not proved the contributory negligence as alleged and the claimants are entitled to compensation. Accordingly the Tribunal proceeded to 15 award compensation of Rs.6,000/-, Rs.3,15,000/-, Rs.3,61,000/-, Rs.4,11,000/-, Rs.1,80,000/-, Rs.3,000/-, Rs.3,000/- and Rs.6,000/- respectively. Hence the present appeals are filed by the Insurance Company.
7. Neither the owner nor the claimants have not filed any appeals for enhancement of compensation against the common impugned judgment and award passed by the Tribunal.
8. I have heard the learned counsel for the parties to the lis.
9. Sri A.N. Krishna Swamy, learned Senior Counsel for the appellant - Insurance Company in all these appeals contended that the Insurance Company filed objections and additional objections and contended that the claimants and others had hired the vehicle for their use and the said vehicle was registered and insured as a 16 private Car policy. The policy issued contained express condition that it should not be used for hire or reward, since the Tempo Trax was hired in violation of the express condition, it is a breach of the policy conditions. Hence the Insurance Company was not liable to pay the compensation. He would contend that though the owner of the offending vehicle had filed the objections denying the claim, but had admitted that the vehicle belonged to him and insured with the appellant. The driver of the Tempo Trax did not possess valid and effective licence was undisputed, but contended that there was contributory negligence on the part of the driver of the Tipper Lorry bearing No.MP-19/D-9427. The occupation, income and accident is also denied. He would contend that the driver was not holding valid and effective licence at the time of the accident. Therefore, the Insurance Company was not liable to pay the compensation in respect of the hired vehicle, where the 17 conditions of the policy has been violated. Therefore, he sought to allow the appeals.
10. Per contra, Smt. Shruti Phonde, learned counsel for Sri.H. Kantharaja, learned counsel for respondents 1 and 2 in MFA Nos.1176/2010, 1177/2010 and 1179/2010 contended that even for the sake of arguments that a person without permit to ply a vehicle cannot be placed on a better pedestal; vis-à-vis one who has a permit, but has violated any condition thereof. Therefore, the Insurance Company is liable to pay the compensation and in view of the dictum of the Hon'ble Supreme Court in the decision of NATIONAL INSURANCE COMPANY LIMITED VS. CHALLA UPENDRA RAO AND OTHERS reported in (2004) 8 SCC 517 held that the High Court was, therefore, not justified in holding the Insurer liable. The Hon'ble Supreme Court held that it would be proper for the insurer to satisfy the award, though in law it has no 18 liability. In some cases the Insurer the insurer has been given the option and liberty to recover the amount from the insured. For the purpose of recovering the amount paid from the owner, 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. Before release of the amount to the claimants, owner of the offending vehicle shall furnish security for the entire amount which the insurer will pay to the claimants. The offending vehicle shall be attached, as a part of the security. If necessity arises the Executing Court shall take assistance of the Regional Transport Authority concerned. The Executing Court shall pass appropriate orders in accordance with law as to the manner in which the owner of the vehicle shall make payment to the insurer. In case there is any default it shall be open to 19 the executing court to direct realisation by disposal of securities to be furnished or from any other property or properties of the owner of the vehicle i.e., the insured. Therefore she would contend that the appellant has to pay the compensation.
11. She also relied upon the decision in SHAMANNA AND ANOTHER Vs. DIVISIONAL MANAGER, ORIENTAL INSURANCE COMPANY LIMITED AND OTHERS reported in (2018) 9 SCC 650 wherein a similar view was taken by the Supreme Court directing the Insurance Company to pay compensation and recover the same.
12. She also relied upon another decision of the Hon'ble Supreme Court in the case of RANI AND OTHERS Vs. NATIONAL INSURANCE COMPANY LIMITED AND OTHERS reported in (2018) 8 SCC 492 to the effect that defence raised by the Insurer that offending vehicle did not possess a valid permit to operate in the State concerned - Accepting that defence, High Court 20 absolving the Insurer and fastening liability on the insured i.e., the owner of the offending vehicle directing him to satisfy the award - Held, even in such a case, the compensation determined must be first paid by the insurer, who could thereafter recover the same from the owner of the offending vehicle. Therefore, she sought to dispose of the appeals.
13. Though these matters had come up on 29.01.2020 in order to give one more opportunity to the owner in MFA Nos.1183/2010, 1176/2010, 1178/2010 and 1184/2010, the matters came to be listed on 30.01.2020. On that day the matters were adjourned.
14. Having heard the learned counsel for the parties, in view of the rival contentions of the learned counsel for the appellant - Insurance Company and learned counsel for the claimants, the only point that arise for consideration in the present appeals is 21 "Whether the common impugned judgment and award passed by the Tribunal fastening the liability on the Insurance Company is justified in the facts and circumstances of the present appeals ? "
15. I have given my anxious consideration to the arguments advanced by the learned counsel for the parties and perused the entire material on record carefully.
16. Having heard the learned counsel for the parties, it is not in dispute that on 11.07.2006 the deceased and the injured claimants were traveling in Tempo Trax bearing Reg.No.KA-16/M-1462 in order to go to Bellary VIMS Hospital. According to the claimants, the driver of the tempo trax drove the vehicle in a rash and negligent manner without following the traffic rules and thereby dashed to the 22 right side of the hind portion of the Tipper Lorry bearing Reg.No.MP-19/d-9427. As a result four inmates of the tempo trax died on the spot and four inmates sustained grievous injuries. The Tribunal considering the entire material on record has recorded a finding that the accident occurred on 11.07.2006 on account of rash and negligent driving on the part of the driver of the tempo trax bearing Reg.No.KA-16/M-1462. The same is evident from the material documents Exs.P1 to P5 and P11, 12, 13, 14, 15, 16 and 17.
17. The Insurance Company has filed the present appeals mainly on the ground that the impugned judgment and award passed fastening the liability on the Insurance Company is erroneous, when the owner of the vehicle has violated the terms and conditions of the policy as the vehicle was sought to 23 use for hire or reward. Therefore, the owner has violated the conditions and Insurance Company is not liable to pay the compensation and also recorded a finding that the Insurance Company failed to prove the contributory negligence on the part of the driver of the tipper lorry bearing Reg.No.MP.19/D-9427. The tribunal considering the material on record has recorded a finding that the accident has taken place because of rash and negligent driving of the tempo trax bearing Reg.No.KA-16/M-1462, owner of vehicle insured with 2nd respondent. Though respondent No.1 says that as on the date of accident insurance policy was in force, no documents was produced by the 2nd respondent to say that there is violation of policy conditions. Therefore, primary liability is on respondent No.1 to pay the compensation, liability is on respondents 1 and 2 is joint and several. 24 Learned counsel for the appellant has contended that the injured persons without admitting in the cross-examination that they were traveling in the Tempo Trax was hired by them. Therefore, the insurance company is liable to pay the compensation either for death or injury. The fact remains the accident occurred on account of rash and negligent driving by the driver of the tempo trax.
18. As rightly contended by the learned counsel for the respondents that even for the sake of arguments that a person without permit to ply a vehicle cannot be placed on a better pedestal vis-à-vis one who has a permit, but has violated any condition thereof. Though the Insurance Company has filed the present appeals, neither the owner of the vehicle nor the claimants have not filed any appeals. 25
19. The Hon'ble Supreme Court while considering the decision of National Insurance Company Vs. Challa Upendra Rao and Others reported in (2004) 8 SCC 517 held that High Court was not justified in holding the insurer liable. The Hon'ble Supreme Court directed the Insurance Company to pay the compensation and recover from the owner giving certain safeguards to the Insurance Company to attach the property of the owner if he fails to pay the compensation in the case of SHAMANNA AND OTHERS reported in (2018) 9 SCC 650 at paragraphs 5, 6, 7, 13 and 14 held as follows :-
"5. In the case of third-party risks, as per the decision in National Insurance Co. Ltd. v. Swaran Singh [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] , the insurer had to indemnify the compensation amount payable to the third-
party and the insurance company may recover 26 the same from the insured. Doctrine of "pay and recover" was considered by the Supreme Court in Swaran Singh case [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] wherein the Supreme Court examined the liability of the insurance company in cases of breach of policy condition due to disqualifications of the driver or invalid driving licence of the driver and held that in case of third-party risks, the insurer has to indemnify the compensation amount to the third-party and the insurance company may recover the same from the insured. Elaborately considering the insurer's contractual liability as well as statutory liability vis-à-vis the claims of third parties, the Supreme Court issued detailed guidelines as to how and in what circumstances, "pay and recover" can be ordered. In para 110, the Supreme Court summarised its conclusions as under: (SCC pp. 341-42) "110. The summary of our findings to the various issues as raised in these petitions is as follows:
27
(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third-
party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of
compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.
(ii) An insurer is entitled to raise a defence in a claim petition filed under Section 163-A or Section 166 of the Motor Vehicles Act, 1988, inter alia, in terms of Section 149(2)(a)(ii) of the said Act.
(iii) The breach of policy condition e.g. disqualification of the driver or invalid driving licence of the driver, as contained in sub-section (2)(a)(ii) of Section 149, has to be 28 proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards the insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant time.
(iv) Insurance companies, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish "breach" on the part of 29 the owner of the vehicle; the burden of proof wherefore would be on them.
(v) The court cannot lay down any criteria as to how the said burden would be discharged, inasmuch as the same would depend upon the facts and circumstances of each case.
(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards the insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main 30 purpose" and the concept of "fundamental breach" to allow defences available to the insurer under Section 149(2) of the Act.
(vii) The question, as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case.
(viii) If a vehicle at the time of accident was driven by a person having a learner's licence, the insurance companies would be liable to satisfy the decree.
(ix) The Claims Tribunal constituted under Section 165 read with Section 168 is empowered to adjudicate all claims in respect of the accidents involving death or of bodily injury or damage to property of third-party arising in use of 31 motor vehicle. The said power of the Tribunal is not restricted to decide the claims inter se between claimant or claimants on one side and insured, insurer and driver on the other. In the course of adjudicating the claim for compensation and to decide the availability of defence or defences to the insurer, the Tribunal has necessarily the power and jurisdiction to decide disputes inter se between the insurer and the insured. The decision rendered on the claims and disputes inter se between the insurer and insured in the course of adjudication of claim for compensation by the claimants and the award made thereon is enforceable and executable in the same manner as provided in Section 174 of the Act for enforcement and execution of the award in favour of the claimants. 32
(x) Where on adjudication of the claim under the Act the Tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of Section 149(2) read with sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third-party under the award of the Tribunal.
Such determination of claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the Tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by sub-section (3) of Section 168 33 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the Tribunal.
(xi) The provisions contained in sub-section (4) with the proviso thereunder and sub-section (5) which are intended to cover specified contingencies mentioned therein to enable the insurer to recover the amount paid under the contract of insurance on behalf of the insured can be taken recourse to by the Tribunal and be extended to claims and defences of the insurer against the insured by relegating them to the remedy before regular court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims."
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6. As per the decision in Swaran Singh case [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] , onus is always upon the insurance company to prove that the driver had no valid driving licence and that there was breach of policy conditions. Where the driver did not possess the valid driving licence and there are breach of policy conditions, "pay and recover" can be ordered in case of third-party risks. The Tribunal is required to consider "as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver ... does not fulfil the requirements of law or not will have to be determined in each case".
7. The Supreme Court considered the decision of Swaran Singh case [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 :
2004 SCC (Cri) 733] in subsequent decision in National Insurance Co. Ltd. v. Laxmi Narain Dhut [National Insurance Co. Ltd. v. Laxmi 35 Narain Dhut, (2007) 3 SCC 700 : (2007) 2 SCC (Cri) 142] , wherein this Court held that: (SCC p. 705, para 5) "5. The decision in Swaran Singh case [National Insurance Co. Ltd.
v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] has no application to cases other than third-party risks and in case of third-party risks the insurer has to indemnify the amount and if so advised, to recover the same from the insured."
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, 36 (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.
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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."
20. The Hon'ble Supreme Court in a Full Bench Decision (3 Judges) RANI AND OTHERS Vs. NATIONAL INSURANCE COMPANY LIMITED AND 38 OTHERS reported in (2018) 8 SCC 492 while considering the provisions of Section 149 of the Karnataka Motor Vehicles Act, 1988, held that it is the duty of the Insurance Company to satisfy the judgment and award against persons in respect of the 3rd party risk at paragraph 15 to 17 has held as under :-
"15. We are of the view that the High Court has already granted more than just compensation amount to the legal representatives of the deceased (Satish). In that, even if the claim of the appellants regarding future prospects, additional medical expenses and additional interest amount was to be accepted, on the basis of the notional income of Rs.5,000/- (Rupees five thousand) per month, the question of awarding additional or further compensation amount to the appellants in MFA No.5874 of 2011 does not arise. The 39 appeal, however, would succeed to the limited extent that the amount of compensation determined by the High Court shall be first paid by Respondent 1 Insurance Company with liberty to recover the same from the owner of the ofrfending vehicle (Respondent 2 herein). We are inclined to allow the appeal to this limited extent, keeping in mind the exposition in Singh Ram Vs. Nirmala and Pappu Vs. Vinod Kumar Lamba.
16. Reverting to the appeal preferred by Respondent 1 Insurance Company against Anand (MFA No.5876 of 2011), as noted in paras 11 and 12 of the Impugned Judgment reproduced above, the High Court disposed of the said appeal by absolving the insurer from the liability to pay compensation amount. As noticed earlier, the appellant (Anand) did not file any appeal against the award passed by the Tribunal for enhancement of compensation amount and the cross-40
objection filed by him in the appeal filed by the Insurance Company came to be dismissed for non-prosecution. Even in respect of this appeal, the Tribunal had found that he failed to produce any evidence regarding his monthly income and the permanent disability suffered by him had been determined as not exceeding 10% to the whole body and compensation had been awarded to him on that basis. Resultantly we intend to dispose of this appeal on the same basis by directing respondent 1 Insurance Company to pay the compensation amount awarded to the claimant (Anand) in the first place, with liberty to recover the same from the owner of the offending vehicle (Respondent 2).
17. In view of the above, the appeals are partly allowed by directing Respondent 1 Insurance Company to first pay the compensation amount to the respective claimants as determined by the High 41 Court and Tribunal as the case may be, with liberty to recover the same from the owner of the offending vehicle, Respondent 2. The impugned judgment and order passed by the High Court stands modified to his limited extent."
21. For the reasons stated above, the point raised in the present appeals has to be answered in the affirmative holding that Insurance Company is liable to pay the compensation in the first instance and liberty reserved to the Insurance Company to recover the same from the owner of the vehicle, who violated the conditions of the policy.
22. Accordingly, the above appeals filed by the Insurance Company are disposed off directing the Insurance Company to pay the compensation to the claimants with liberty to the Insurance Company to 42 recover the same from the owner in accordance with law.
23. The amount in deposit made by the Insurance Company in all these appeals shall be transmitted to the jurisdictional Tribunal along with the records, if any, forthwith.
Ordered accordingly.
Sd/-
JUDGE NG* CT:bms