Hukum Chand Insurance Co. Ltd. v. Subashini Roy — 1970 DIGILAW 153 (CAL)

Judgment 1. THIS appeal is preferred by the insurer Hukum Chand insurance Co. Ltd. against an award of compensation given by the Motor Accident Claims Tribunal, Howrah, (referred to herein as Claims Tribunal) in favour of the respondent No. 1 on the death of her son in an unfortunate motor accident. 2. THE case of petitioner-mother, subashini Roy, briefly is that her son, shanti Gopal Roy, while proceeding on a cycle along Beadon Street from east to west at about 2 P. M. on July 1, 1963 was knocked down by a motor car No. W. B. C. 6471 belonging to respondent no. 2, Khagendra Nath Nundy. The victim was immediately removed to R. G. Kar Hospital where he was declared dead. Shanti Gopal, it is alleged, was an artisan, skilled in manufacture of gold ornaments and looked after the jewellery shop of his father, Sadhu charan Roy. It is further alleged that he could have as independent employee earned Rs. 200/- to Rs. 300/- per month. Shanti Gopal a young man of 24 years died a bachelor leaving the petitioner as his sole heir and legal representative. Accordingly, the petitioner claimed Rs. 30,000/- as compensation. In the written defence the owner did not deny either the accident or the death of Shanti Gopal but it was asserted that his car No. W. B. C. 6471 was not involved in the alleged accident and thus he was not liable for any compensation or damages. 3. THE only defence of the opposite party No. 2, the present appellant, was that as insurer it was not liable for any damages owing to breach of certain terms of insurance. The owner of the car, it was alleged, did not report the accident to the insurer immediately after the occurrence. 4. THE Tribunal on consideration of evidence found that Shanti Gopal was knocked down by car No. W. B. C. 6471 belonging to the opposite party no. 1 at the junction of Beadon Street and Chittaranjan Avenue at about 2 p. M. on July 1, 1963 owing to rash and negligent driving of the car and died. Accordingly, the Tribunal on assessment awarded compensation of Rs. 24,300/-with a direction upon the insurer, to pay the amount to the petitioner-mother within two months from the date of the award. In the appeal before us Mr. Accordingly, the Tribunal on assessment awarded compensation of Rs. 24,300/-with a direction upon the insurer, to pay the amount to the petitioner-mother within two months from the date of the award. In the appeal before us Mr. Dutt learned Advocate for the appellant challenged the correctness of this decision both on questions as to the identity of the car involved in the accident and also the quantum of compensation awarded by the Tribunal. But before we enter into the merits we must dispose of a preliminary point raised by Mr. Chatterjee on behalf of the petitioner-respondent. It is said that the present appellant being the insurer under Section 96 (2) of the Motor Vehicles Act (referred to herein as the act) it is not open to the appellant to dispute the correctness of the decision of the Tribunal on grounds not covered by the defence which it is entitled to take under the law. To appreciate the correctness of this contention it is necessary to look into several sections of the Act regulating the rights and liabilities of the insurer in relation to the third party in respect of claims relating to compensation in motor accident cases. 5. THE entire scheme of compulsory insurance against third party risk is contained in Chapter VIII of the Act. Section 93 contains definitions of certain terms including 'authorised insurer'. Section 94 provides for compulsory insurance for using a motor vehicle in public place against third party risk with all just exceptions mentioned in sub-Section (2) thereof. Section 95 specified the type of the Insurance Company or the Co-operative society by whom the policy of insurance would be required to be issued and also fixes in certain cases the limits of liability of such policy of insurance. Section 95a with which we are not concerned in this case lays down how and in what circumstances a policy of insurance issued in reciprocating countries would be valid. Then Section 96 (1) fixes the liability of the insurer to satisfy judgment against persons insured in respect of third party risk as if the insurer is the judgment debtor in respect of the liability. But Sub-section (2) of Section 96 provides that no sum shall be payable by an insurer under sub-section (1) unless a notice is given either before or after the commencement of the proceedings in the court. But Sub-section (2) of Section 96 provides that no sum shall be payable by an insurer under sub-section (1) unless a notice is given either before or after the commencement of the proceedings in the court. It also enables an insurer on notice so given to defend the action on certain grounds specified in clauses (a) to (c) with several sub-clauses therein. Subsection (2) (a) of Section 96 is also not relevant for our present purpose as it deals with the liability on a judgment from a court in the State of Jammu and kashmir or any of reciprocating countries or a foreign judgment. Sub-sections (3), (4), (5) and (6) specify the principle or the manner in which the insurer is to meet this liability and recover excess amount from the persons insured and other connected matters in details. Then the various provisions as contained in Section 97 to 108 which deal with the rights of third parties against insurance on insolvency of the insurer, settlement between the insurer and insured persons, insolvency of the insured person, effect of death of a person in whose favour certificate of insurance has been issued, effect of certificate of insurance, cancellation of policy of insurance, production of certificate of insurance, permission to a registered co-operative society of transport vehicle owners to transact business of an insurer are not relevant for the purpose of the present case. Section 109 casts a duty upon the registering authority or an officer in-charge of a police station to furnish particulars of vehicles involved in an accident. 6. NOW confining ourselves to the point raised it appears that after issue of a certificate of such insurance the insurer is bound to satisfy the liability under a judgment as if he is the judgment debtor in respect of the liability together with costs and interest of judgment but before any sum on account of such liability becomes payable the insurer must be given an opportunity to defend the action but no limited grounds specified in Clauses (a), (b) and (c)including various sub-clause, enumerated there under. These grounds, as appear, substantially relate to cancellation of the policy either before or 14 days after the happening of the accident or breach of the specified condition excluding the use of the vehicle for certain purpose or the policy being void on the grounds that it was obtained by non-disclosure of the material fact or false representation of material particular. It seems, therefore, clear that in an action for compensation in respect of the accident involving the death or bodily injury of a person arising out of using a motor vehicle all other possible defences to such action are not open to insurer. This no doubt may create hardship and difficulties in many cases but the rights and liabilities of the insurer on insurance policy issued by him for use of a motor vehicle are created by statute and if in regulating such rights and liabilities the statute has confined his rights to defend an action against a claim for compensation only on restricted grounds, the insurer certainly cannot be permitted to surpass the limitation imposed upon him in defending such action for that would result in enlargement of the rights of the insurer which is not given to him under the Act. So, on a fair reading of Subsection (1) and (2) along with Subsection (0) of Section 96 of the Act it cannot but be concluded that an insurer is not entitled to avoid his liability except on the grounds specified in clauses (a) to (c) of Sub-section (2)of Section 96. In the view we have taken, we are fortified by the decision of the Supreme Court in the case of (1)B. I. G. Insurance Co. v. Itbar Singh, air 1959 SC 1331 , where Sarkar, J. (as he then was) while considering the identical question speaking for the court stated the opinion as follows : -"we, therefore, think that Sub-section (2) clearly provides that an insurer made a defendant to the action is not entitled to take any defence which is not specified in it. " Mr. Chatterjee has also relied on a decision of Bombay high Court reported in (2) AIR 1968 bom. 267 , Abdulkadar v. Kashinath, where applying the law stated by the supreme Court in B. I. G. Insurance co. " Mr. Chatterjee has also relied on a decision of Bombay high Court reported in (2) AIR 1968 bom. 267 , Abdulkadar v. Kashinath, where applying the law stated by the supreme Court in B. I. G. Insurance co. v. Itbar Singh (Supra) it has been held that Sub-section (2) of Section 96 gave a right to the insurer to defend the action only on limited ground specified therein. Mr. Dutta, however, has sought to distinguish the Supreme court case relying on a, decision of madras High Court reported in AIR 1968 Mad. 436 , (3) K. Gopalakrishnan v. Sankara Narayan., on the ground that the decision of the Supreme Court was given in connection with a suit for compensation before a court and not before a Claims Tribunal and, therefore, the law as stated by the Supreme court on interpretation of that Section cannot be made applicable to an action before the Claims Tribunal. It appears that in the Madras case the reason which weighed with the High Court is that "the decisions do not refer to proceeding before a Claims Tribunal where the insurers are made parties and the scope for defence which they want to put forward has not, in any way, been restricted." With respect we are unable to agree with the view taken by the Madras High Court. We fail to find in any of these amended sections from 110 to 110 F that there is any provision either for making the insurer a party or they are entitled to take open defence in any adjudication proceeding before the Claims Tribunal for compensation. Section 110 provides for setting up of Claims Tribunal by notification in local gezette by the State government for adjudication upon claims for compensation in respect of accidents involving the death or bodily injury arising out of use of motor vehicles. Sub-section (2) provides for constitution of such Claims Tribunal whereas Sub-section (3) lays down the qualification for appointment of member of Claims Tribunal. Sub-section (4) provides for distribution of business where two or more Claims Tribunal are constituted for any area. Sub-section (2) provides for constitution of such Claims Tribunal whereas Sub-section (3) lays down the qualification for appointment of member of Claims Tribunal. Sub-section (4) provides for distribution of business where two or more Claims Tribunal are constituted for any area. Section 110a provides for the contents of an application for compensation before the Claims Tribunal and the time limit within which such an application is to be made with a power given to the claims Tribunal to entertain the application even if it is made after the expiry of the limited period of 60 days. Section 110 B lays down that the Claims tribunal shall after giving parties am opportunity of being heard hold an enquiry into the claim and make an award specifying amongst other things the amount which shall be paid by the insurer. Section 110c lays down, the procedure and powers of Claims Tribunal and also confers certain powers of civil court for the purpose of taking evidence and oath and enforce attendance of witnesses and of compelling discovery and production of documents etc. The appeals are provided for in section HOD. In Section 110 E provisions are made for recovery of the money from insurer as arrear of land revenue. Then Section 110f provides that where a Claims Tribunal has been constituted no civil court shall have jurisdiction to entertain any such claim for compensation. From study into the above sections it would thus appear that the only change that has been introduced in matters of adjudication of claims for compensation by the amended provision is that the courts are replaced by the Claims Tribunal whenever set up for this purpose in any area by notification made by the State Government for adjudication of claims for compensation following a summary procedure with right of appeal to High Court. It, therefore, follows that although section 96 (2) has not been suitably amended, whenever a Claims Tribunal is set up for any area the word 'court' occurring in Section 96 (2) must be interpreted to mean Claims Tribunal. Any other interpretation would lead to anomalous and absurd result. For, Section 96 (1)and (2) of the Act as explained by the Supreme Court in B. I. G. Insurance Co. Any other interpretation would lead to anomalous and absurd result. For, Section 96 (1)and (2) of the Act as explained by the Supreme Court in B. I. G. Insurance Co. v. Itbar Singh (Supra)fixes the liability of the insurer to satisfy judgment against insured and apart from the statute he has no right to be made a party in an action for compensation against a person insured. Clearly, therefore, the amended provisions conferring power of adjudication on Claims tribunal over such action if divorced from Section 96 (1) and (2) of the Act would be rendered ineffective. This apart, if the insurer, as contended by Mr. Dutt, is entitled to take open defence before the Claims Tribunal cases may be visualised where in consequence of setting up of Claims Tribunal in a particular area, in the same State or part of a State, two sets of conflicting laws would come into play for adjudication of such claims over similar matters affecting rights and liabilities of same kind of insurers, one conferring right upon insurer to defend on restricted grounds an action before the court and the other creating a right to defend before the Claims Tribunal without any restriction. Such a consequence, in our opinion, could never have been in contemplation of the legislature. In the state of law as it stands, however, we do not think, there is any scope for alternative construction but even if there is any "that alternative" to quote the expression of lord Shaw in 1924 A. C. 185 P. C., (4)Shannon Realities v. St. Maichel, "is to be chosen which will be consistent with the smooth working of the system which the statute purports to be regulating; and that alternative is to be rejected which will introduce uncertainty, friction or confusion into the working of the system". This rule of construction is adopted by the Supreme court in (5) Collector of Customs v. Digbijoy Singh, AIR 1961 SC 1549 . It is true that normally the court will not introduce or substitute or add any word in a section which is not there but it is also a settled rule of construction that the court will lean in favour of reading a section or sections with appropriate changes for giving effect to the smooth and harmonious working of the system and for fulfilment of the purposes of the Act. In Craise on Statute Law, 5th Edition it is stated at page 103 as follows: "but where the alternative lies between either supplying by implication words 'which appear to have been accidentally omitted', or adopting a construction which deprives certain existing words of all meaning, it is permissible to supply the words " (e)". The Supreme Court in (6) Paresh chandra v. State of Assam, AIR 1962 sc 167 , felt this difficulty of applying section 23 of Land Acquisition Act I of 1894 to Assam Lands (Requisition and acquisition) Act as Section 23 of L. A. Act lays down provisions for acquisition and not of requisition and for effective operation of the Requisition and acquisition Act. Subba Rao, J. (as his lordship then was) speaking for the court expressed himself as follows : "if instead of the word acquisition the word requisition is read, and instead of the words the market value and the interest in the land of which the owner has been deprived are read, the two sub-sections of Section 23 can without any difficulty be applied to the determination of compensation for requisition of land. So too, the other sections can be applied. " 7. SO, in the present context if the word 'court' in section 96 (2) is read as claims Tribunal whenever necessary then such 'uncertainty, friction or confusion' may be avoided and the entire scheme of adjudication by Claims Tribunal as embodied in the amended provisions of Section 110 to 110f can be smoothly put into effect. That being so, it seems clear that the insurer is entitled to defend an action only on limited grounds specified in Clauses (a)to (c) with Sub-Clauses enumerated therein even before the Claims Tribunal set up by notification for the purpose of adjudication of claim for compensation. Accordingly, it is not open to appellant insurer in the instant appeal to defend an action on any grounds other than those mentioned in Clauses (a) to (c) or several Sub-clauses therein under Sub-section (2) of Section 98 of the Act. Clearly, therefore, the present appeal by the appellant insurer challenging the correctness of the decision of the Claims Tribunal on grounds not covered by Clauses (a) to (c) or any of the Sub-clauses therein must be held to be not maintainable. 8. WE must, however, record the arguments advanced by Mr. Clearly, therefore, the present appeal by the appellant insurer challenging the correctness of the decision of the Claims Tribunal on grounds not covered by Clauses (a) to (c) or any of the Sub-clauses therein must be held to be not maintainable. 8. WE must, however, record the arguments advanced by Mr. Dutt on points raised by him at the outset. In the first place he has contended that dentity of the car involved in the accident was not established by evidence. it is said that the number of the car originally rioted by the Traffic Constable on duty and the taxi driver on the spot did not tally with the number given in the first information, lodged in the police station or in the statements made in the hospital. On the other hand the owner of the car, it is submitted, adduced sufficient evidence to establish that the car in question at the material time was lying in a garage for repairs in a completely dismantled condition. It is urged that the forensic expert's evidence about original colour of the car given simply on his visual impression should not have been relied upon as conclusive. At any rate, such evidence did not establish the type of green colour the car was alleged to have at the time of accident. There are great discrepancies, it is said, in the testimony of the witnesses who spoke about the type of green colour the car had. In any event, none of the witnesses has stated that the car had 'marine green' colour as recorded in the sale register produced in this case. Mr. Chatterjee, however, sought to repel these contentions on an argument that reading evidence as a whole there could not be any escape from the conclusion that the car in question was responsible for causing the death of the son of the respondent No. 1. On the question of quantum of damages Mr. Dutt has argued that the claims Tribunal has utterly failed to follow well recognised rules and principles in assessing compensation in such cases. It is submitted that the award given is highly arbitrary, excessive and improper. According to Mr. Dutt the tribunal has considered the loss of income of the deceased and not of the mother which should be the criterion for ascertaining the damages in this case. It is submitted that the award given is highly arbitrary, excessive and improper. According to Mr. Dutt the tribunal has considered the loss of income of the deceased and not of the mother which should be the criterion for ascertaining the damages in this case. For this purpose he has relied on two English decisions reported in 1941 (1) All ER (7) Benham v. Gambling; 1942, (1) All ER 657, (8) Davies v. Powell Duffryn and also several decisions of the Supreme Court and High courts reported in AIR 1970 SC 376 , (9) C. K. S. Iyer v. T. K. Nair; AIR 1962 SC 1 , (10) Gobald Motor Service v. Veluswami; AIR 1965 Cal. 252 , (11)Indian Airlines v. Madhuri Chaudhri and AIR 1967 Mad. 54 , (12) I. M. G. Insurance Society v. M. K. Naidu and contended that in the facts and circumstances of the present case the mother, the petitioner, from the death of her son has not suffered any loss. For she is economically dependent upon the husband who admittedly possesses a jewellery shop and no doubt earns a substantial income. Even after the death of her husband, it is said, the. mother will be entitled to a share of the jewellery shop or, at any rate, she will be maintained out of the income of the jewellery business and, therefore, she will have no loss of her income, in any event, it is submitted that in ascertaining the damages all these very vital questions have not been considered at all. The Claims Tribunal, it is said, has proceeded entirely on wrong premises and arrived at a figure which is clearly not allowable under the law. Although we allowed Mr. Dutt to advance elaborate arguments in the view taken by us on the preliminary point we, as at present advised, think it unnecessary to examine the correctness of these contentions and express any opinion in either way. On the actual and permissible defence taken by the appellant before the Tribunal complaining breach of term of insurance certificate we hold, however, that the decision of the Claims Tribunal is correct. 9. MR. Bhattacharji on behalf of the owner-respondent, however, has pressed us for a decision on the merits of the case at his instance for he supported the appeal preferred by the present appellant. 9. MR. Bhattacharji on behalf of the owner-respondent, however, has pressed us for a decision on the merits of the case at his instance for he supported the appeal preferred by the present appellant. He has relied on order 41 rule 4 of the Code of Civil Procedure for this purpose and submitted that we should have decided the appeal on merits. We are unable to accept this contention as correct. First, in an appeal under Section 110d of the Act, we do not think, there is any scope for application of order 41 of the Code. Secondly, as the appeal preferred, in our view, is not maintainable at the instance of the insurer-appellant against the decision of the Claims Tribunal on grounds not allowed under the Act the question of supporting such appeal does not lie. Thirdly, the owner not having preferred an appeal in spite of the right he has under the statute the question of interfering with the decision of the Claims Tribunal on merits does not arise at all. 10. ACCORDINGLY, we would dismiss the appeal but in the facts and circumstances of the present case we make no order as to costs.