Karnataka High Court
The Oriental Insurance Co Ltd vs Shri Venkateshappa @ Venkatesh on 15 November, 2022
Author: H.T.Narendra Prasad
Bench: H.T.Narendra Prasad
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 15TH DAY OF NOVEMBER 2022
BEFORE
THE HON'BLE MR.JUSTICE H.T.NARENDRA PRASAD
MFA No.8236 OF 2011 (MV)
C/W
MFA Nos.8237 OF 2011 & 8238 OF 2011
IN MFA No.8236 OF 2011:
BETWEEN:
THE ORIENTAL INSURANCE CO LTD
DIVISIONAL OFFICE NO.5,
SHANKAR HOUSE NO.1,
RMV EXTENSION, MEKHRI CIRCLE,
BANGALORE, REP. BY ITS REGIONAL OFFICE
NO.44/45, 4TH FLOOR, LEO SHOPPING COMPLEX
RESIDENCY ROAD,
BANGALORE-560 025,
REPRESENTED BY ITS REGIONAL MANAGER. ... APPELLANT
(BY SRI P.B. RAJU, ADVOCATE)
AND:
1. SHRI NAGARAJA
S/O LATE M. BACHEGOWDA
AGED ABOUT 50 YEARS
RESIDENT OF GARDEN ROAD
SIDDALAGHATTA TOWN
CHICKBALLAPUR DISTRICT-562 101.
2. SHRI B.S. HARISH
S/O B.V. SONNE GOWDA
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MAJOR, R/O VINAYAKANAGAR PUTTUR,
DAKSHINA KANNADA-574 201. ... RESPONDENTS
(BY SRI K.T. GURUDEVA PRASAD, ADVOCATE FOR C/R-1;
NOTICE TO R2 HELD SUFFICIENT V/O DATED 09.02.2016)
THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT,
AGAINST THE JUDGMENT AND AWARD DATED 22.2.2011
PASSED IN MVC NO.9532/2009 ON THE FILE OF XVI
ADDITIONAL JUDGE, COURT OF SMALL CAUSES, MEMBER,
MACT, BANGALORE, AWARDING A COMPENSATION OF
Rs.4,00,000/- WITH INTEREST @ 6% P.A. FROM THE DATE OF
PETITION TILL REALISATION.
IN MFA NO.8237/2011:
BETWEEN:
THE ORIENTAL INSURANCE CO LTD
DIVISIONAL OFFICE NO.5,
SHANKAR HOUSE NO.1, RMV EXTENSION,
MEKHRI CIRCLE, BANGALORE
REP. BY ITS REGIONAL OFFICE,
NO.44/45, 4TH FLOOR,
LEO SHOPPING COMPLEX,
RESIDENCY ROAD, BANGALORE-560 025,
REPRESENTED BY ITS REGIONAL MANAGER. ...APPELLANT
(BY SRI P.B. RAJU, ADVOCATE)
AND:
1. SHRI VENKATESHAPPA @ VENKATESH
S/O MUNIVENKATAPPA
R/O NO.16, III CROSS, II MAIN,
NAGASHETTIHALLI, BANGALORE.
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2. SHRI B.S. HARISH
S/O OF B.V. SONNE GOWDA
MAJOR, R/O VINAYAKANAGAR, PUTTUR,
DAKSHINA KANNADA-574 201. ... RESPONDENTS
(BY SRI K.T. GURUDEV PRASAD, ADVOCATE)
THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT,
AGAINST THE JUDGMENT AND AWARD DATED 22.2.2011
PASSED IN MVC NO.1052/2010 ON THE FILE OF XVI
ADDITIONAL JUDGE, MACT, BANGALORE CITY, AWARDING A
COMPENSATION OF Rs.1,23,040/- WITH INTEREST @ 6% P.A.
FROM THE DATE OF PETITION TILL REALISATION.
MFA NO 8238 OF 2011
BETWEEN
1. THE ORIENTAL INSURANCE CO LTD
DIVISIONAL OFFICE NO.5,SHANKAR HOUSE NO.1, RMV
EXTENSION,MEKHRI CIRCLE BANGALORE. REP BY
ITSREGIONAL OFFICE, NO. 44/45, 4TH FLOOR,LEO
SHOPPING COMPLEX, RESIDENCY ROAD,BANGALORE-25,
REP BY ITS REGIONAL MANAGER. .. APPELLANT
(BY SRI P B RAJU, ADVOCATE)
AND
1. SHRI K MANJUNATHA
AGED ABOUT 29 YEARS
S/O KRISHNAPPA
RESIDENT OF NO. 12, VENKATALA,
II MAIN, II CROSS, BANGALORE
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2. SHRI B S HARISH
S/O OF B V SONNE GOWDA
MAJOR, R/O VINAYAKANAGAR,
PUTTUR, DAKSHINA KANNADA .. RESPONDENTS
(BY SRI K.T. GURUDEVA PRASAD, ADVOCATE FOR C/R-1;
NOTICE TO R2 HELD SUFFICIENT V/O DATED 09.02.2016)
MFA FILED U/S 173(1) OF MV ACT AGAINST THE
JUDGMENT AND AWARD DATED 22.02.2011 PASSED IN MVC
NO.1053/2010 ON THE FILE OF THE XVI ADDITIONAL JUDGE,
MACT, BANGALORE, AWARDING A COMPENSATION OF
Rs.1,39,960/- WITH INTEREST @ 6% P.A. FROM THE DATE OF
PETITION TILL REALIZATION.
THESE MFAs, COMING ON FOR HEARING, THIS DAY, THE
COURT DELIVERED THE FOLLOWING:
JUDGMENT
These appeals under Section 173(1) of Motor Vehicles Act, 1988 (hereinafter referred to as 'the Act') have been filed by the Insurance Company being aggrieved by the judgment and decree dated 22.02.2011 passed by the Motor Accident Claims Tribunal, Bangalore City, SCCH-14, in MVC Nos.9532/2009, 1052/2010 and 1053/2010. Since the challenge is to the same judgment, all the appeals are clubbed together, heard and common judgment is being passed.
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2. Facts giving rise to the filing of the appeals briefly stated are that on 29.06.2009 at about 5.30 a.m. the claimant in MVC No.1052/2010 was traveling in a tempo along with chicken worth Rs.2,37,704/- on NH-7 in between Mudagurki and Hurlagurki gate, the claimant in MVC No.9532/20089 was following the said tempo in a car. At that time, one lorry bearing registration No.KA-21/A- 1764 came at a high speed and in a rash and negligent manner dashed against the tempo. Due to the impact, the tempo hit the claimant in MVC No.1053/2010 who was a pedestrian and then fell into a ditch. The claimant in MVC No.9532/2009 sustained grievous injuries, sustained loss towards damage of tempo and also the chicken.
3. The claimants filed petitions under Section 166 of the Act seeking compensation. It was pleaded that they spent huge amount towards medical expenses, conveyance, etc., towards repair charges and also loss of chicken. It was further pleaded that the accident occurred purely on 6 account of the rash and negligent driving of the offending vehicle by its driver.
4. On service of notice, the respondent - Insurance Company appeared through counsel and filed written statement in which the averments made in the petition were denied. The age, avocation and income of the claimants and the medical expenses are denied. It was pleaded that the petition itself is false and frivolous in the eye of law. It was further pleaded that the driver of the offending vehicle did not have valid driving licence as on the date of the accident. It was further pleaded that the liability is subject to terms and conditions of the policy. It was further pleaded that the quantum of compensation claimed by the claimants is exorbitant. Hence, he sought for dismissal of the petition.
The respondent No.1 did not appear before the Tribunal inspite of service of notice and was placed ex- parte.
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5. On the basis of the pleadings of the parties, the Claims Tribunal framed the issues and thereafter recorded the evidence. On behalf of the claimants six witnesses have been examined as PW1 to PW6 and got exhibited documents namely Ex.P1 to Ex.P22. On behalf of the respondents, one witness was examined as RW-1 and got exhibited documents namely Ex.R1 to Ex.R7. The Claims Tribunal, by the impugned judgment, inter alia, held that the accident took place on account of rash and negligent driving of the offending vehicle by its driver, as a result of which, the claimants sustained injuries. The Tribunal further held that the claimants are entitled to compensation of Rs.4,00,000/-, Rs.1,23,040/- and Rs.1,39,960/-, respectively, along with interest at the rate of 6% p.a. and directed the Insurance Company to deposit the compensation amount along with interest. Being aggrieved, these appeals have been filed.
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6. Sri P.B.Raju, the learned counsel for the Insurance Company has raised the following contentions:
Firstly, the owner of the offending vehicle has issued a cheque bearing No.315899 dated 04.08.2008 for a sum of Rs.99,445/- for the said vehicle which was bounced with an endorsement of the bank dated 28.08.2008 as 'insufficient funds'. Immediately thereafter they have issued the letter of endorsement to the owner of the offending vehicle and his brother. In support of his contention he has produced Ex.R1 endorsement issued by the bank to the effect that the cheque has been returned for 'insufficient fund'. The Tribunal has erred in holding that the Insurance Company is liable to pay the compensation.
Secondly, in the policy there is specific condition that in case of dishonour of the premium cheque company shall not be liable and the policy shall be void abinitio (from inception). Therefore, even after the accident intimation has been sent. In view of the condition, from the inception, the 9 policy has become void abinitio. Therefore, the Insurance Company is not liable to pay the compensation. But the Tribunal has erred in fastening liability on the Insurance Company. Hence, he sought for allowing the appeals.
7. On the other hand, Sri K.T.Gurudeva Prasad, the learned counsel appearing for the claimants has raised the following contentions:
Firstly, the owner of the lorry has issued cheque bearing No.315899 for a sum of Rs.99,445/-. The contention of the Insurance Company is that they have remitted the cheque to the bank on 05.08.2008 and they have not produced any document to show that the cheque has been bounced and no document has been placed before the court to show that they have issued any notice of cancellation of the policy. Ex.R1 is dated 10.11.2010. No document has been produced to show that the cheque has been returned with an endorsement 'insufficient fund' in the year 2008 and they have not produced the dishonoured 10 cheque before the Tribunal. Therefore, the Tribunal has rightly held that the Insurance Company is liable to pay the compensation.
8. Heard the learned counsel for the parties and perused the judgment and award and the original records.
9. It is not in dispute that the claimants have sustained injuries in the road traffic accident occurred on 29.06.2009 and tempo of the claimant bearing registration No.KL-14/H-1958 suffered damages.
10. The case of the Insurance Company is that the owner of the lorry bearing registration No.KA-21/A-1764 has issued a cheque bearing No.315899 dated 04.08.2008 for a sum of Rs.99,445/- for the said vehicle and also another vehicle of his brother drawn on Canara Bank towards insurance premium amount for both the vehicles. The said cheque was bounced on 05.08.2008 for 11 'insufficient fund'. To prove that the cheque has been bounced, the Insurance Company has not produced any document. Ex.R1 produced by the Insurance Company is the endorsement issued by the bank which is dated 10.11.2010. The accident occurred on 29.06.2009 and after almost one year 10 months from the date of the cheque the endorsement is issued. The cheque has been bounced on 05.08.2008 for insufficient funds. No document has been placed before the Tribunal that they have issued notice that the policy has been cancelled. The only contention taken by the Insurance Company is that the document has been destroyed due to heavy rain fall. But they have not produced even the bounced cheque. The Tribunal after considering the evidence of the parties has rightly given a finding which is extracted hereinbelow:
"23. The respondent No.2 Insurance Company has contended that first respondent owner of the lorry bearing No.KA-21/A-1764 had issued a cheque bearing No.315899 dated 12 04.08.2008 for a sum of Rs.99,445/- for the said vehicle and also another vehicle of his brother drawn on Canara Bank towards insurance premium amount for both the vehicles. The said cheque was remitted to HSBC Bank on 05.08.2008 for clearance. A policy was issued bearing No.421500/31/2009/2762 to the said offending vehicle and another policy bearing No.42500/31/2009/2761 for his brother's vehicle but the said premium cheque returned with a bank endorsement on 28.8.2008 as "insufficient funds". After dishonour of the said cheque on 05.08.2008 this respondent contends that they have issued a letter of intimation to the first respondent and his brother one B.S.Raveesh and also copy of the said intimation letter is sent to the RTO authorities at Puttur and Commissioner of Police Traffic Division at Puttur regarding dishonour of the said cheque and that after the said intimation, policy stood cancelled and there was no insurance coverage covering the risk of any claim involving the said lorry corresponding to the period from 04.08.2008 to 03.08.2009. In support of their contention they have examined 13 officer of the company as RW-1 and got marked Ex.R1 to R6, which are all endorsement, RPAD letter, postal receipts, copy of the policy issued in favour of respondent No.1, copy of policy and cancellation of policy. RW1 was cross examined at length and he has clearly admitted that they have issued the policy to the lorry bearing No.KA-21/A-1764 for the period from 04.08.2008 to 03.08.2009. As per Ex.R5, premium amount is Rs.51,000/- but the cheque amount which they are relying on is for Rs.99,445/-. Further this respondent contends that it is for two lorries but they have failed to show the number of another lorry and the said lorry number is also not mentioned in the affidavit evidence of RW1. Nothing prevented the Insurance Company to produce the bounced cheque. But for this they say due to heavy rain the said cheque was destroyed in their office. Further RW1 has stated that he does not know when the said cheque was destroyed due to heavy rain. Further RW1 has admitted that nowhere it is mentioned about the cheque in the said policy, and that he has not produced any 14 records to show that, the said policy is related to the said cheque. When such being the case, Insurance Company has failed to prove that the said cheque was bounced. Further in support of their contention Insurance Company has relied upon 2000 ACJ SC Page 630, AIR 2001 SC Page 1197, ILR 2002 Kar. Page 5239, 2006 (2) Kar.L.J.Page 477, ILR 1997 Kar.Page 2173, 2002 ACJ Kerala Page 217. I have gone through all these but none of them are exactly applicable to the case on hand. At this juncture my attention is drawn to the following:
2004 ACH 1554 of Hon'ble High Court of Andhra Pradesh wherein their lordships have held as follows:
"MV Act, 1988, Sections 147(5) and 149(1) and Insurance Act, 1038, Section 64-VB-Motor Insurance - Police - Dishonour of cheque - Liability of Insurance Company - Policy was issued but cheque towards premium was dishonoured. Insurance Company contended that it sent notice to insured about dishonour of cheque and requested for remittance and confirmation that there has been no loss during continuation of policy - Later on Insurance Company sent another notice canceling the policy from its 15 commencement as no payment was received though this notice was served after the period for which the vehicle was insured but in the meantime vehicle met with accident and liability had been incurred - When a cheque is dishonoured, procedure contemplated is that drawer has to be informed about the dishonour of cheque and given an opportunity to make good the loss sustained by the drawee - Insurance Company failed to produce any evidence that these two notices were served on the insured - Whether the Insurance Company is exempted from liability: Held: No: insured was not given opportunity to remit the premium amount in lieu of dishonoured cheque."
In view of the above, the Tribunal is justified in fastening liability on the Insurance Company.
Re.quantum:
11. Considering the evidence of the parties and materials available on record, the compensation awarded by the Tribunal is just and reasonable. There is no error in the judgment and award passed by the Tribunal. Accordingly, appeals are dismissed.
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The amount in deposit is ordered to be transferred to the Tribunal forthwith.
In view of disposal of the appeals, all the pending applications stand disposed of.
Sd/-
JUDGE Cm/-