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2003 DIGILAW 391 (GAU)

Ajay Jaiswal v. Mahadev Debnath

2003-08-25

P.G.AGARWAL

body2003
JUDGMENT P.G. Agarwal, J. 1. Heard Mr. C.K. Sarma Barua, learned Sr. Advocate, assisted by Mr. N. Rajkhowa appearing for the Appellant, Ajay Jaiswal. Also heard Mr. J. Singh, learned Sr. Counsel for the Claimant-Cross Objector. None appeared for the Insurance Co. 2. These two appeals, MAC Appeal No. 82/99 and MAC Appeal No. 83/99, were heard together and disposed of by this common judgment. 3. MAC Appeal No. 82/99 has arisen out of the judgment and award dated 16.7.99 passed by the learned Member, Motor Accident Claims Tribunal, Golaghat in MACT Case No. 86/96 and MAC Appeal No. 83/ 99 has also arisen out of the judgment and award dated 16.7.99 of the learned Member, Motor Accident Claims Tribunal, Golaghat passed in another case, i.e. MACT Case No. 37/96. Both these appeals were heard together, although two separate claim petitions were filed by the two claimants, the matter relates to one incident, which occurred on 13.2.1996. Sri Mahadev Debnath, claimant in MACT Case No. 86/96 and his father, Kartick Debnath (since deceased) were travelling in a night-super bus, bearing Registration No. AS-01/D-6401. While the bus reached near Nambar Reserve Forest, some unknown miscreants fired shots, as a result of which, both Kartick Debnath and Mahadev Debnath sustained injuries on their persons. Kartick Debnath died at the spot; whereas, Mahadev Debnath sustained severe injuries on his person. The wife of Kartick Debnath, Smt. Mina Debnath, filed MACT Case No. 37/96 claiming compensation for the death of her husband; whereas, Mahadev Debnath claim compensation for the injuries sustained by him. The Motor Accident Claims Tribunal, Golaghat (hereinafter referred to as 'the Tribunal') vide two separate orders dated 16.7.99 granted compensation of Rs. 50,000/- in MACT Case No. 86/96 and a sum of Rs. 1,18,000/- in MACT Case No. 37/96. The Tribunal further held that the National Insurance Co. Ltd. is not liable to pay the compensation and saddled the owner, Ajay Jaiswal, with the liability. Hence the present appeal by the owner of the vehicle. The two claimants have also filed cross-objection stating, inter alia, that the amount of damages awarded, is not just and proper. The cross- objections were also heard along with the appeal. 4. In both the cases, notices were issued to the National Insurance Co. Ltd., who has been arrayed as Respondents in both the appeals, but although notices were duly served, the Insurance Co. The cross- objections were also heard along with the appeal. 4. In both the cases, notices were issued to the National Insurance Co. Ltd., who has been arrayed as Respondents in both the appeals, but although notices were duly served, the Insurance Co. have failed to appear and, as such, both the appeals are disposed of ex- parte against them. 5. So far the incident of 13.2.1996 is concerned, wherein some miscreants fired shots on a moving bus, resulting in death of Kartick Debnath and injury to Mahadev Debnath, there has been overwhelming documentary and oral evidence on record and a finding to that effect has been recorded by the Tribunal. The Tribunal also held that at the relevant time the said vehicle was insured with the National Insurance Co. Ltd., hereinafter referred to as 'the Insurer'. The factum of death of Kartick Debnath and injury to Mahadev Debnath was also recorded by the Tribunal and the above findings are not disputed or challenged either by the owner of the vehicle or the claimants before us. So far the findings of the Tribunal that the insurer is not liable to pay compensation is concerned, the Appellants have seriously challenged the same. The insurer had appeared before the Tribunal, wherein they have admitted that at the relevant time the vehicle was insured with them, but claimed immunity on the ground that there was no coverage of risk for the death of passenger/third party by terrorist activities arising out the use of the motor vehicle. 6. On perusal of the impugned judgment, we find that the learned Tribunal had proceeded on a wrong impression that the incident of firing was committed by the terrorist; whereas, there is absolutely no evidence or material to that effect. The injured, Mahadev Debnath, has categorically stated that some unknown miscreants fired shots on the vehicle. A copy of the Police Report was also filed and it was perused thereafter by the Tribunal also. We have also perused the Police Report available and find that nowhere in the Police Report, it has been stated that the firing was resorted to by terrorist or it is a case of terrorist activity. Police has categorically stated that some unknown miscreants fired shots at the vehicle causing death and injuries and after prolong investigation, police could not find out the identity of the miscreants. Police has categorically stated that some unknown miscreants fired shots at the vehicle causing death and injuries and after prolong investigation, police could not find out the identity of the miscreants. Thus, we find that the Tribunal committed grave error in holding that this was a case of terrorist activity. 7. There is another aspect of the matter. The copy of the Insurance policy was produced by the insurer through D.W. 1, and it was marked as Ext. B. After perusal of the oral evidence of D.W. 1 and Ext. B, the Tribunal held that the insured did not pay any extra premium for the terrorist activities and the policy has not contained any clause that terrorist activities shall cover and, as such, the Tribunal held that the insurer is not liable. We have perused Ext. B, the insurance policy and find that so far the loss of the damaged vehicle is concerned, there is a specific provision that it includes any terrorist activities. So far the liability to third party is concerned, it provides that: Subject to the limit of liability, as laid down in the Schedule hereto the Company will indemnify the insured against all sums including claimant's cost and expenses which the injured shall become legally liable to pay in respect of- (i) Death or bodily injury to any person caused by or arising out of the use (including the loading and/or unloading) of the motor vehicle; (ii) Damage to properties caused of the use (including the loading and/or unloading) of the vehicle. Thus, we find that it nowhere says that the death or bodily injury caused due to any terrorist activities is excluded. Further, the said policy provides six clauses, narrating six situation or circumstances under which the company shall not be liable to pay damages in respect of any injury. These sub-clauses are in (a), (b), (c), (d), (e) and (f). Thus, in none of the circumstances it is stated that death or injury arising out of terrorist activities is excluded from the purview of the insurance cover. It is a comprehensive insurance policy taken out by the owner of the vehicle for, as many as, 35 passengers paying a total premium of Rs. 11,485/- and the policy was valid from the period 23.11.95 to 22.11.96. It is a comprehensive insurance policy taken out by the owner of the vehicle for, as many as, 35 passengers paying a total premium of Rs. 11,485/- and the policy was valid from the period 23.11.95 to 22.11.96. We are, therefore, constrained to hold that the Tribunal has miserably failed to interpret or read the policy in its proper perspective and proceeded on certain presumption which are not available. 8. The claimants had placed reliance on a decision of this Court in the case of Samir Chanda v. Managing Director ASTC, 1998 (3) GLT 37. The case is Samir Chanda (Supra) was approved by the Apex Court in 1998 (8) SCC 605 . In Samir Chanda (Supra) the death occurred due to bomb blast in the bus and the Apex Court upheld the compensation granted by this Court stating that as the accident arose out of the use of motor vehicle, the claimant is entitled to compensation. 9. In the case of Rita Devi (Smt.) and Ors. v. New India Assurance Co. Ltd. and Anr. 2000 (2) GLT(SC) 1 : 2000 (5) SCC 113 , an auto-rickshaw driven by the deceased was taken away with the object of stealing the same and, thereafter, the driver was killed. Although the Court held that this is a case of murder but as the accident was the proximate cause of murder, compensation was awarded for the death of the deceased and the insurer was asked to pay the same. 10. In a recent case of United India Insurance Co. Ltd. v. Lehru and Ors. 2003 (3) SCC 338 , the Apex Court had the occasion to examine the question of liability of the insurer in respect of a third party risk-defence of insurer against his liability. The Apex Court observed: Thus under Sub-section (1) the insurance company must pay to the person entitled to the benefit of the decree, notwithstanding that it has become 'entitled to avoid or cancel or may have avoided or cancelled the policy'. The words 'subject to the provisions of this section' mean that the insurance company can get out the liability only on grounds set out in Section 149. Sub-section (7), which has been relied on, does not state anything more or give any higher right to the insurance company. On the contrary, the wording of Sub-section (7) viz. The words 'subject to the provisions of this section' mean that the insurance company can get out the liability only on grounds set out in Section 149. Sub-section (7), which has been relied on, does not state anything more or give any higher right to the insurance company. On the contrary, the wording of Sub-section (7) viz. 'no insurer to whom the notice referred to in Sub-section (2) or Sub-section (3) has been given shall be entitled to avoid his liability' indicates that the legislature wanted to clearly indicate that insurance companies must pay unless they are absolved of liability on a ground specified in Sub-section (2). This is further clear from Sub-section (4) which mandates that conditions, in the insurance policy, which purport to restrict insurance would be of no effect if they are not of the nature specified in Sub-section (2). The proviso to Sub-section (4) is very illustrative. It shows that the insurance company has to pay to third parties but it may recover from the person who was primarily liable to pay. The liability of the insurance company to pay is further emphasized by Sub-section (5). This also shows that the insurance company must first pay, then it can recover. If Section 149 is read as a whole it is clear that Sub-section (7) is not giving any additional right to the insurance company. On the contrary it is emphasizing that the insurance company cannot avoid liability except on the limited grounds set out in Sub-section (2). Now let us consider Section 149(2). Reliance has been placed on Section 149(2)(a)(ii). As seen, in order to avoid liability under this provision it must be shown that there is a 'breach'. As held in Skandia and Sohan Lal Passi cases the breach must be on the part of the insured. We are in full agreement with that. To hold otherwise would lead to absurd results. Just to take an example, suppose a vehicle is stolen. Whilst it is being driven by the thief there is an accident. The thief is caught and it is ascertained that he had no licence. Can the insurance company disown liability? The answer has to be an emphatic "No'. To hold otherwise would be to negate the very purpose of compulsory insurance. Whilst it is being driven by the thief there is an accident. The thief is caught and it is ascertained that he had no licence. Can the insurance company disown liability? The answer has to be an emphatic "No'. To hold otherwise would be to negate the very purpose of compulsory insurance. The injured or relatives of the person killed in the accident may find that the decree obtained by them is only a paper decree as the owner is a man of straw. The owner himself would be an innocent sufferer. It is for this reason that the legislature, in its wisdom, has made insurance at least third-party insurance, compulsory. The aim and purpose being that an insurance company would be available to pay. The business of the company is insurance. In all businesses there is an element of risk. All persons carrying on business must take risks associated with that business. Thus it is equitable that the business which is run for making profits also bears the risk associated with it. At the same time innocent parties must not be made to suffer or loss. These provisions meet these requirements. We are thus in agreement with what is laid down in the aforementioned cases viz. that in order to avoid liability it is not sufficient to show that the person driving at the time of accident was not duly licensed. The insurance company must establish that the breach was on the part of the insured. 11. The matter was considered again by a Three Judge Bench in the case of National Insurance Co. Ltd. v. Saurag 2004 (I) TAC 321 (SC) and the Apex Court reiterated its earlier decision regarding liability of the insurer and the defences available to it. 12. In view of what has been stated above and considering the materials on record that death of Kartick Debnath and injury of Mahadev Debnath had taken place due to the use of the motor vehicle and it was not a case of terrorist activity and the vehicle was covered by an insurance policy, it was the insurer, i.e. the National Insurance Co. Ltd., who are liable to pay compensation and the owner of the vehicle, Ajoy Jaiswal, is not liable and the order of the learned Tribunal saddling the owner, Ajoy Jaiswal, with the liability, is liable to be set aside, which we do hereby. 13. Ltd., who are liable to pay compensation and the owner of the vehicle, Ajoy Jaiswal, is not liable and the order of the learned Tribunal saddling the owner, Ajoy Jaiswal, with the liability, is liable to be set aside, which we do hereby. 13. Now coming to the cross-objection in MACT 37/96, the claimant, who is a widow, has stated that her husband was serving in a saw mill and getting a salary of Rs. 3,000/- per month. The couple had 2 sons and 3 daughters at the relevant time. As there was no documentary evidence except the oral evidence of the claimant, the Tribunal held that the pay of the deceased cannot be accepted as Rs. 3,000/- P.M. and the Court determined the pay at Rs. 2,000/- P.M. The Tribunal might not have accepted the oral evidence only but considering the facts and circumstances of the case and the fact that the deceased was maintaining a big family of 6 persons, even by guesswork, the income should not have been reduced to Rs. 2,000/-. We, therefore, hike the same to Rs. 2,500/- per month, i.e. Rs. 30,000/- per year. After deducting 1/3 towards personal expenses etc. the annual dependency comes to Rs. 20,000/-. 14. The deceased was aged 55 years and the Tribunal adopted a multiplier of 8. However, in case of person aged 55 years the multiplier available is 11 and we adopt the same. Thus, the compensation comes to Rs. 2,20,000/-, to this, we add a further sum of Rs. 2,000/- towards funeral expenses and a sum of Rs. 5,000/- towards loss of consortium etc. The Tribunal's finding for deduction of 10% towards uncertainly of life has no basis. The total compensation in MACT Case No. 37/96 is, therefore, determined at Rs. 2,27,000/-. The claimants are also entitled interest @ 9% on the above amount from the date of filing of the claim till payment thereof. 15. MAC Appeal No. 86/96 is in respect of injuries of the claimant Mahadev Debnath. The Medical Report from Apollo Hospital shows that the injured had sustained bullet injury on right side of face and the left maxilla missing with only some small pieces. Orbital plate partially present, hard palate on left side absent, nasal septum and lateral wall of nose partially absent. The Medical Report from Apollo Hospital shows that the injured had sustained bullet injury on right side of face and the left maxilla missing with only some small pieces. Orbital plate partially present, hard palate on left side absent, nasal septum and lateral wall of nose partially absent. The injured had undergone treatment at Apollo Hospital, Chennai and also at Care Home and Diagnostic Centre, Guwahati, which aspect was accepted by the Tribunal and the Tribunal also held that the injured had sustained grievous injuries and he had undergone pain and suffering for the above injuries. The injured was available before the Tribunal and this is what the Tribunal had observed-"I have seen him personally and I find that their has been facial deformity". 16. Learned Counsel for the claimant has placed before us two photographs to bring home the fact that the injured has become permanently disabled because of the deformity in the face/mouth. Even inspite of the above materials, the Tribunal, in absence of any permanent disability certificate, refused to grant adequate compensation. The claimant had produced the bills and cash memos for his treatment at Guwahati and Appollo Hospital, Chennai. The medical expenses incurred by the claimant both at Chennai, as well as, at Guwahati is Rs. 37,653/- (approximately). Moreover, the injured along with the attendant must have spent huge amount for their traveling from Golaghat to Guwahati and then to Chennai and back, including their stay at both the places. The Tribunal has made a lump sum compensation of Rs. 50,000/- only, whereas the medical and other attending expenses shall come to more than Rs. 57,000/-. The claimant is still suffering and there is an advice from the Doctor which shows that for further treatment the claimant needs a further sum of Rs. 1,00,000/-. It is stated "that the claimant is at present taking liquids as he lost his entire teeth and he cannot take any solid food and the mouth is required to be rehabilitated. Considering all these facts and circumstances, for the injuries sustained by Mahadev Debnath, we provide as follows: (i) Actual medical and other attending expenses Rs. 50,000/- (ii) Further treatment (future treatment) Rs. 50,000/- (iii) Pan and suffering Rs. 30,000/- (iv) Loss of income and other joys of life Rs. 20,000/- Total Rs. 1,50,000/- The claimant is thus entitled to a sum of Rs. 50,000/- (ii) Further treatment (future treatment) Rs. 50,000/- (iii) Pan and suffering Rs. 30,000/- (iv) Loss of income and other joys of life Rs. 20,000/- Total Rs. 1,50,000/- The claimant is thus entitled to a sum of Rs. 1,50,000/- (One Lakh fifty thousand) only which shall be payable by the insurer. The claimant shall also be entitled to an interest @ 9% per annum on the amount of Rs. 1,00,000/-, awarded to him, from the date of claim petition till the payment thereof. No interest is payable on compensation for future treatment. 17. At this stage, Shri C.K. Sarma Barua, learned Sr. Counsel for the Appellant has submitted that the Appellant-owner has paid a sum of Rs. 25,000/- in MAC Appeal No. 82/99 and an amount of Rs. 50,000/- in MAC Appeal No. 83/99 and the said amount had been withdrawn by the claimant. The insurance company shall reimburse the Appellant/owner the amount to that effect and deduct the amount already paid from the total awarded amount of the claimant. The Insurance company is given two month's time to pay the amount awarded. Both the appeals stand disposed of accordingly.