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2004 DIGILAW 658 (AP)

National Insurance Company Ltd. v. G. Mohd. Rafiq

2004-07-07

C.Y.SOMAYAJULU

body2004
( 1 ) RESPONDENTS 1 to 5 who are the legal representatives of Iqbal Khan (the deceased) filed the claim petition under Section 163-A of the Motor Vehicles Act, 1988 (the Act) seeking compensation of Rs. 4,24,500/-from the 6th respondent and the appellant, who are the owner and insurer respectively of the motor cycle bearing No. AP 2-7442 alleging that the deceased, who was a doctor, at the instance of the 6th respondent, went to give medical treatment to one of the relatives of the 6th respondent on the motor cycle belonging to the 6th respondent, and met with an accident resulting in his death. Sixth respondent chose to remain exparte before the Tribunal. Appeal against him was dismissed for default in payment of process. ( 2 ) IN support of the their case, respondents 1 to 5 examined two witnesses as P. Ws. 1 and 2 and marked Exs. A-1 to A-5. No evidence either oral or documentary was adduced on behalf of the appellant. The Tribunal held that respondents are entitled to rs. 1,79,600/- as compensation from the sixth respondent and appellant and passed an award accordingly. Questioning its liability to pay the compensation to respondents 1 to 5 and also the quantum of compensation awarded to them, the insurer of the motor cycle on which the deceased was proceeding at the time of his death, preferred this appeal. ( 3 ) SRI Kota Subbarao, Learned counsel for the appellant raised the following contentions, (i) The Tribunal was in error in awarding huge compensation when the deceased himself was responsible for the accident and in any event the compensation awarded needs reduction, (ii) Since the deceased was not having a valid driving license, the appellant is not liable to pay compensation, (iii) Since the driver of the motor cycle is not covered by the policy of insurance, in any event, appellant is not liable to pay any compensation to the claimants, (iv) Interest awarded is too high. ( 4 ) SINCE the appellant admittedly, did not obtain permission under Section 170 of the act, to take all the pleas that are open to the 6th respondent, who chose to remain exparte, in view of the ratio in National Insurance company Limited v. Nicolletta Rohtagi appellant cannot question the quantum of compensation. So the first contention of the learned counsel for the appellant cannot be countenanced. So the first contention of the learned counsel for the appellant cannot be countenanced. ( 5 ) IN view of the ratio in National Insurance company Limited v. Swaran Singh, question whether the deceased was having a valid driving license or not is not relevant If the appellant is able to establish that the deceased was not having a valid driving license and that 6th respondent knowing that fact entrusted the motorcycle to the deceased, it can after paying the compensation awarded to the claimants, recover the said amount from 6th respondent. So the second contention of the learned counsel for the appellant also has no force. ( 6 ) IN support of his third contention, the learned counsel for the appellant relied on new India Assurance v. Asha Rani and ramashray Singh v. New India Assurance company Limited. The said decisions have no application to the facts of this case because they relate to cases of passengers in goods vehicle, by interpreting Section 147 (1) and proviso thereto. ( 7 ) IN Asha Rani case it is held as follows in para 25. "25. Section 147 of 1988 Act, inter alia, prescribes compulsory coverage against the death of or bodily injury to any passenger of public service vehicle . Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle would be limited to the liability under the workmen s Compensation Act. It does not speak of any passenger in a goods carriage . " ( 8 ) IN fact, para 26 of the said judgment would be an answer to the point raised by the learned counsel for the appellant. It reads:"26. In view of the changes in the relevant provisions in 1988 Act vis-a-vis 1939 Act, we are of the opinion that the meaning of the words any person must also be attributed having regard to the context in which they have been used, i. e. , a third party . Keeping in view the provisions of 1988 Act, we are of the opinion that as the provisions thereof do not enjoin any statutory liability on the owner of the vehicle to get his vehicle insured for any passenger traveling in a goods vehicle, the insurers would not be liable therefore. Keeping in view the provisions of 1988 Act, we are of the opinion that as the provisions thereof do not enjoin any statutory liability on the owner of the vehicle to get his vehicle insured for any passenger traveling in a goods vehicle, the insurers would not be liable therefore. " ( 9 ) THE vehicle involved in the accident in this case is a motorcycle which is not a goods vehicle, and so question of its owner taking out an insurance policy to cover the risk of passengers traveling on it does not arise, and so Asha Rani case (3 supra) is of no help to the appellant. ( 10 ) IN Ramashray Singh case (4 supra) the question for consideration was whether shashi Bhushan Singh, in respect of whose death a claim petition was filed, was employed as a kalasi in the of fending vehicle. After his death in the accident, the legal representatives of Shashi Bhushan Singh filed a claim petition under the Workmen s compensation Act on the ground that he was a kalasi; Workmen s Compensation court held that the vehicle was comprehensively insured and directed the insurer to deposit the compensation determined under the Workmen s compensation Act. That decision was challenged by the insurer before the High court. The High Court, allowed the Writ petition on the ground that in the absence of any special contract between the insurer and the owner of the vehicle, insurer cannot be made liable in respect of a kalasi under the motor Vehicles Act. That decision of the high Court was challenged before the supreme Court. The case of the owner of the vehicle was that he paid premium for 13+1 persons and that would cover the liability of kalasi also. The insurer refuted the claim on the ground that no additional premium was paid to cover the risk of kalasi, and in any event in view of Section 14 (l) (b) of the Act, employee of the insured is not covered by the policy issued by it. After referring to section 147 of the Act, the Supreme Court held as follows: over and above the risks which are covered by this statutory provision, parties may of course enter into a contract by which the insurer agrees to cover additional risks. After referring to section 147 of the Act, the Supreme Court held as follows: over and above the risks which are covered by this statutory provision, parties may of course enter into a contract by which the insurer agrees to cover additional risks. It is not the appellant s case that apart from the policy of insurance there was any contract between the appellant and the insurance company. The policy has a clause which defines the limits of liability in respect of death or bodily injury to any person caused by or arising out of the use of the motor vehicle under Section II (1) of the terms and conditions of the Policy. In proviso (b) to Section II (1), it has been expressly stated that"except so far as is necessary to meet the requirements of the Motor vehicles Act, the company shall not be liable in respect of death of or bodily injury to any person in the employment of the insured arising out of an in the course of such employment. ". ( 11 ) IN para 10, it is held as follows: the appellant s first submission was that Shashi Bhushan Singh was a passenger. The appellant s submission that the phrases any person and any passenger in clauses (i) and (ii) of Subsection (b) of Section 147 (1) are of wide amplitude, is correct. [see: New India assurance Co. Ltd. v. Satpal Singh, 2000 ac) 1 (SC)]. However, the proviso to the sub-section carves out an exception in respect of one class of persons and passengers, namely, employees of the insured. In other words, if the person or passenger is an employee, then the insurer is required under the statute to cover only certain employees. Ltd. v. Satpal Singh, 2000 ac) 1 (SC)]. However, the proviso to the sub-section carves out an exception in respect of one class of persons and passengers, namely, employees of the insured. In other words, if the person or passenger is an employee, then the insurer is required under the statute to cover only certain employees. As stated earlier, this would still allow the insured to enter into an agreement to cover other employees, but under proviso to section 147 (1) (b), it is clear that for the purpose of Section 146 (1) a policy shall not be required to cover liability in respect of the death arising out of and in the course of any employment of the person insured unless - first: the liability of the insured arises under workmen s Compensation Act, 1923 and second: if the employee is engaged in driving the vehicle and if it is a public service vehicle, is engaged as conductor of the vehicle or in examining tickets on the vehicle. If the concerned employee is neither a driver nor conductor nor examiner of tickets, the insured cannot claim that the employee would come under the description of any person or passenger . . . . . . . ( 12 ) SINCE the victim in this case was not a passenger in a goods vehicle or an employee in a public service vehicle, the above two decisions relied on by the learned counsel for appellant do not apply to the facts of this case. ( 13 ) SINCE the victim in this case was not the owner of the motorcycle and was a third party and Section 147 (1) (b) (i) mandates that the policy should cover the liability which may be incurred in respect of the death or bodily injury to any person the victim i. e. , the deceased would come within the sweep of any person used in Section 147 (l) (b) (i) of the Act, and so the contention that the appellant is not liable to pay the compensation payable to respondents 1 to 5 has no force. Having undertaken to cover the risk of the persons traveling on the motorcycle appellant cannot be heard to say that it is not liable to pay compensation to the victim who was driving the vehicle, on the ground that the accident took place due to his negligence only. Having undertaken to cover the risk of the persons traveling on the motorcycle appellant cannot be heard to say that it is not liable to pay compensation to the victim who was driving the vehicle, on the ground that the accident took place due to his negligence only. Even when the accident took place due to the negligence of the third party driver of a motorcycle resulting in injuries or death to him, the insurer is bound to pay the compensation payable therefor, because it agreed to cover that risk. So I find no force in the third contention also. ( 14 ) I find force in the fourth contention of the learned counsel for the appellant that the interest awarded by the Tribunal is exorbitant. The interest awarded at 15% p. a. needs reduction and so the same is reduced to 9% p. a. from the date of filing of petition, till the date of deposit. ( 15 ) IN the result, the appeal is dismissed. However, the interest awarded by the tribunal is reduced from 15% p. a. to 9% p. a. Parties are directed to bear their own costs in this appeal.