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2008 DIGILAW 724 (GAU)

New India Assurance Co. Ltd. v. Bindu Bhushan Sen

2008-09-24

BROJENDRA PRASAD KATAKEY

body2008
JUDGMENT B.P. Katakey, J. 1. This appeal by the Insurance Company is directed against the award dated 24.4.2006 passed by the learned Member, Motor Accident Claims Tribunal, Sonitpur, Tezpur in MAC Case No. 286 of 2003 awarding a sum of Rs.18,16,633/- as compensation to the claimant for sustaining 80% permanent disability along with interest @ 8% per annum with effect from the date of filing of the claim petition till the date of payment and directing the Insurance Company to satisfy the award in view of the insurance coverage issued by it. 2. The Respondent No. 1 herein filed an application under Section 166 of the Motor Vehicle Act, 1988 (hereinafter for short 'the Act') before the Motor Accident Claims Tribunal, Sonitpur claiming compensation for the injury sustained by him in a motor accident occurred on 1.9.2002 at about 5.45 a.m. alleging that on that date when was riding on the vehicle (scooter) bearing Registration No. AS-12/B/5266 (Scooter) as pillion rider driven by the owner of the scooter namely the Respondent No. 2, had met with an accident as the owner/driver of the scooter lost his control and both of them and fallen down as a result of which the Respondent claimant sustained grievous injuries. It has further been contended in the said application that he was immediately taken to Kanaklata Civil Hospital, Tezpur, but due to seriousness of the injury was shifted to Down Town Hospital, Guwahati and again admitted to GNRC Hospital, Guwahati on 2.9.2002 where he was treated for 13 days and as per doctor's advise he was then taken to Patna on 12.11.2002 where he was treated till 3.7.2003. As he was not recovered from the injuries sustained, he was again taken to Apollo Hospital, New Delhi where was treated till 12.9.2003. The claimant in the claim petition has further contended that he was a Bank employee and due to the accident he suffered from paralysis with 80% disablement and was the only earning member of the family consisting of five members including his wife and three sons and because of the injury he was unable to continue in employment requiring him to remain on leave without pay and to take premature retirement. The Respondent-claimant therefore claimed compensation of Rs.55,50,000/-. The said application was registered as MAC Case No. 286/2003. 3. The Respondent-claimant therefore claimed compensation of Rs.55,50,000/-. The said application was registered as MAC Case No. 286/2003. 3. The owner of the scooter as well as the Insurance Company contested the claim of the Respondent-claimant by filing written statements. The owner-cum-driver of the vehicle in his written statement denying the allegation made by the claimant has pleaded that the claim application is not maintainable, it is bad for proper notice and that the claimant has availed medical benefits and the bank paid him Rs.3,00,000/-. The owner-cum-driver also denied the allegation of rash and negligent driving stating that the accident took place due to bad road condition. It has, however, been stated in the written statement that the vehicle has been duly and comprehensively insured with the Appellant Insurance Company at the relevant point of time and, therefore, in the event any compensation is awarded, the same is to be paid by the Insurance Company. The present Appellant has also filed written statement denying the claim as well as the allegations made by the claimant in the claim application and stating, inter alia, that unless the claimant produce and prove the evidences relating to the accident and also the nature of injury suffered, the Insurance Company is not liable to pay compensation to the claimant. The Insurance Company has also pleaded that the accident took place due to the fault of the claimant himself, and that the driver of the vehicle had no valid driving license and, therefore, the insurer is not liable to pay compensation. The Insurance Company in the written statement also contended that it is liable to pay compensation as per terms and conditions of the policy of insurance. 4. The Respondent-claimant in support of the claim examined himself and another witness namely, Khitish Biswas, who is a witness to the accident as well as Dr. Pradip Barua in support of his claim. Those witnesses were duly cross-examined by the Appellant Insurance Company. However, the Respondent-owner did not cross-examine those witnesses at all. The Respondent-claimant, who has been examined as witness No. 1, has narrated the circumstance under which the accident occurred, the nature of injuries suffered by him and also the extent of disability he suffered because of such accident. The claimant has also proved that the accident took place due to rash and negligent driving of the scooter. The Respondent-claimant, who has been examined as witness No. 1, has narrated the circumstance under which the accident occurred, the nature of injuries suffered by him and also the extent of disability he suffered because of such accident. The claimant has also proved that the accident took place due to rash and negligent driving of the scooter. The statement of the claimant relating to rash and negligent driving has duly been supported by the claimant' witness No. 2. Dr. P.K. Barua, who has been examined as claimant's witness No. 3 has also stated that the claimant suffered 80% permanent disablement and the disability suffered by him is quite unlikely to improve in future. 5. The learned Tribunal upon appreciation of the evidences on record came to the finding that the claimant suffered 80% disability and he requires constant assistance of others to do normal daily works and as a result of the accident he lost his job and the earning capacity. The learned Tribunal having regard to the monthly income of the claimant and the loss of income, therefore, awarded a sum of Rs.18,16,633/- together with interest as aforesaid and directed the Appellant Insurance Company to satisfy the award, the vehicle being covered by comprehensive policy of insurance. It may, however, be noticed that neither the owner of the vehicle nor the Insurance Company produced any document relating to the insurance covered and liability of the Insurance Company under the policy. The Insurance Company, however, in the written statement filed, did not deny the insurance coverage issued by it. 6. The present appeal by the Insurance Company is challenging the direction issued by the learned Tribunal to satisfy the award on the ground that the contract of insurance between the insurer and the insured limits the liability of insurance company to the extent of Rs.1,00,000/- only in respect of the pillion rider. 7. Since the Appellant Insurance Company has challenged the direction issued by the learned Tribunal to satisfy the award on the ground noticed above, and as neither the certificate of insurance nor, the policy of insurance containing terms and conditions was produced by neither of the parties to such contract of insurance, this Court vide order dated 14.8.2008 passed in Misc. Case No. 754/2007 directed the Appellant Insurance Company to produce the policy of insurance containing terms and conditions. Case No. 754/2007 directed the Appellant Insurance Company to produce the policy of insurance containing terms and conditions. The said miscellaneous application has been filed by the Insurance Company with a prayer for accepting the certificate of insurance issued by the Insurance Company along with the policy schedule without, however, producing the terms and conditions of the policy. The Appellant-Insurance Company thereafter filed an application being Misc. Case No. 2475/2008 enclosing therewith a standard printed form (unfilled) of policy containing terms and conditions as Annexure-1. In the said application an explanation has been sought to be given for not producing the terms and conditions of the policy entered into between the parties and stating that a copy of the policy has already been filed in the Court, though no such policy has been filed by the Insurance Company, except the certificate of insurance. In paragraph-2 of the said application it has been stated as follows: (2) That your humble Petitioner states that the copy of the policy was already filed in the Hon'ble Court and in order to save the stationery in the copies of the docket containing the terms and conditions of the policy are not retained and attached with the office copies of the policies. The reason for the proceeding with the practice being that terms and condition of the policies are uniform for particular types of policies and printed forms are available in the company, which are attached to the policies provided to the insured. 8. Another application, registered as Misc. Case No. 3230/2006, has also been filed by the Appellant Insurance Company praying for leave under Section 170 of the Act to contest and challenge the award passed by the learned Tribunal on all or any of the grounds available to the owner of the vehicle apart from the ground available to it under Section 149(2) of the Act. The said application has been rejected vide order dated 2.9.2008 on the ground that the condition stipulated under Section170 of the Act for granting permission to the Insurance Company under the said provision of law have not been fulfilled, without, however, deciding the question as to whether such permission under Section 170 can be granted by the appellate Court, as the same was never prayed for before the learned Tribunal. 9. 9. This Court vide order dated 2.9.2008 allowed the application filed by the Appellant Insurance Company, registered as Misc. Case No. 754/2007 (praying for accepting the certificate of insurance issued along with the policy schedule appended thereto), and the application filed as Misc. Case No. 2475/2008 (to accept the explanation of the Insurance Company for non-production of the terms and conditions of the policy) by observing that the said certificate of insurance as well as unfilled standard terms and conditions and also the regulations relating to the premium to be paid shall be taken into consideration while deciding the appeal. 10. I have heard Mr. S.S. Sharma, learned senior counsel appearing for the Appellant-Insurance Company, Mr. R. Sarma, learned Counsel appearing for the Respondent-claimant and Mr. R. Parasar, learned Counsel for the Respondent-owner. 11. Mr. S.S. Sharma, learned senior counsel appearing for the Appellant referring to the certificate of insurance, schedule of policy and also the standard (unfilled) form containing the terms and conditions of the policy has submitted that the insured having paid extra premium of Rs.120/- in respect of the personal accident benefit for two persons with the limit of rupees one lakh in respect of each of such persons, the Insurance Company is liable for Rs.1,00,000/- only under the contract of insurance between the parties toward the compensation payable to the Respondent claimant a awarded by the learned Tribunal. According to the learned senior counsel, pillion rider not being a third party, as the accident occurred due to rash and negligent driving by the owner and driver of the scooter in which the claimant Respondent was a pillion rider, the Insurance Company cannot be saddled with the liability of satisfying the entire award on the ground that a premium of Rs.160/- has been paid toward 'liability of public risk', the same being the premium paid for the liability under the provisions of the Act in respect of the third parties. It has further been submitted by the learned Counsel for the Appellant that since the owner of the vehicle in questions claim that because of the contract of insurance with the Insurance Company the liability of making payment of the compensation is on the Insurance Company, it was the duty of the owner to produce all the documents before the learned Tribunal and the learned Tribunal also without there being any document before it, directed the Insurance Company to satisfy the entire awarded amount only on the ground that a comprehensive policy was issued. Mr. Sharma in support of his contention that pillion rider cannot be termed as third party in respect of an accident occurred due to rash and negligent driving of the driver of the scooter in which the claimant is a pillion rider, has placed reliance on the decisions of the Apex Court in United India Insurance Co. Ltd., Shimla v. Tilak Singh and Ors. (2006) 4 SCC 404 and Oriental Insurance Co. Ltd. v. Sndhakaran K.V. and Ors. 2008 (3) TAC 1 (SC) 12. Mr. Parashar, learned Counsel appearing for the Respondent-owner, on the other hand, submitted that the Insurance Company never challenged its liability to indemnify the owner of the vehicle in respect of the compensation awarded by the learned Tribunal and has also not produced any document before the learned Tribunal to demonstrate that its liability is limited to Rs.1,00,000/- only. According to the learned Counsel the Insurance Company even before this Court has failed to produce the office copy of the contract of insurance entered into between the parties containing the terms and conditions thereof. It has further been submitted that since admittedly the policy of insurance was a comprehensive policy, the learned Tribunal has rightly directed the Insurance Company to satisfy the award. According to the learned Counsel the premium of Rs.160/- paid towards 'liability to public risk', risk in respect of pillion rider of scooter is also included and therefore the Insurance Company is liable to pay the compensation as awarded by the learned Tribunal. 13. Mr. R. Sarma, learned Counsel appearing for the Respondent-claimant has submitted that the claimant is basically not concerned who is paying the amount of compensation as awarded by the learned Tribunal so long the quantum of compensation is not challenged. 13. Mr. R. Sarma, learned Counsel appearing for the Respondent-claimant has submitted that the claimant is basically not concerned who is paying the amount of compensation as awarded by the learned Tribunal so long the quantum of compensation is not challenged. It has been submitted that since in the present appeal the Insurance Company is not challenging the quantum, so also the owner, the amount of compensation as awarded by the learned Tribunal, may be directed to be deposited by the Insurance Company, in terms of the order passed by the learned Tribunal, which may," however, be recovered by the Insurance Company from the owner of the vehicle, provided the liability of the Insurance Company is only to the extent of Rs.1,00,000/- in respect of the pillion rider, as contended by the learned senior counsel for the Appellant. Mr. Sarma, however, has submitted that in the absence of any document produced before the learned Tribunal and also because of non-production of either the original policy or the office copy of the policy containing the terms and conditions of such policy, it may not be possible on the part of this Court to record any finding as to whether the limits of liability of the Insurance Company is restricted to Rs.100,000/- as contended by the learned senior counsel appearing for the Appellant. 14. The quantum of compensation awarded by the learned Tribunal vide impugned award has not been challenged in the present appeal. The permission sought for by the Insurance Company under Section 170 of the M.V. Act before this Court has already been rejected vide order dated 2.9.2008 as discussed above. The owner of the vehicle has also not challenged the quantum of compensation as awarded by the learned Tribunal. Therefore, this Court is not required to go into the sufficiency or otherwise of the quantum of compensation awarded by the learned Tribunal. The appeal is limited to the liability of the Insurance Company, if any, to satisfy the award as passed by the learned Tribunal and its extent. 15. As noticed above, neither the insurer nor the insured produced any document before the learned Tribunal to substantiate their respective pleas. The appeal is limited to the liability of the Insurance Company, if any, to satisfy the award as passed by the learned Tribunal and its extent. 15. As noticed above, neither the insurer nor the insured produced any document before the learned Tribunal to substantiate their respective pleas. Since the dispute in the present appeal is based on the policy of insurance issued, the certificate of insurance which has been produced by the Insurance Company along with the policy schedule has been accepted by this Court by the aforesaid order dated 2.9.2008 passed in Misc. Case No. 754/2007 with a view to resolve the matter in controversy between the insured and the insurer effectively and completely. The owner of the vehicle cannot object to production of such documents before this Court, he having claimed benefit under such document. The Certificate of Insurance issued by the insurer stipulates the limits of liability, which reads as follows : (a) Limit of amount of the compensation liability under Section III(i) in respect of any one accident as per the Motor Vehicles Act, 1988; (b) Limit of the amount of the Company's liability under Section III(ii) in respect of any claim or series of claims arising out of one event Rs.6000/-. The policy schedule appended to the Certificate of Insurance reveals the schedule of premium paid by the insured in respect of the vehicle in question under three different heads, namely (1) Damage premium Rs.520.00 (2) Liability to public risk Rs.160.00 (3) Personal Accident benefit (2X100000) Rs.120.00 Thus the total premium paid was Rs.800/-, to which 5% service tax amounting to Rs.40/- was added and the not premium paid was R. 840/-. 16. It has also been mentioned, under the caption 'important notice', in the said policy schedule that "any payment made by the Company by reason of wider terms appearing in the certificate in order to comply with the Motor Vehicles Act, 1988, is recoverable from the insured". The insurer in the said notice has also referred to Clause of "Avoidance of certain terms and right of recovery" in the policy. The unfilled standard form containing the terms and conditions of a policy issued in respect to two wheeler, as submitted by the Insurance Company in Misc. Case No. 2475/2008 contains Section IIwhich relates to the liability of third party. The unfilled standard form containing the terms and conditions of a policy issued in respect to two wheeler, as submitted by the Insurance Company in Misc. Case No. 2475/2008 contains Section IIwhich relates to the liability of third party. The pillion rider in respect of the scooter, which is involved in the accident due to rash and negligent driving by the driver of the scooter, cannot be the third party within the meaning of Section 147 of the Act, as held by the Apex Court in Oriental Insurance Company Ltd. (supra). Therefore, for the premium paid towards 'liability of pubic risk', which is nothing but the insurance for the 'act liability' only cannot cover a pillion rider. There can, however, be a policy of insurance covering the risk of a pillion rider of the motor vehicle by paying extra premium and unless such contract of insurance is entered into, the legal obligation arisen under Section 147 of the Act, cannot be extended to an injury or death of pillion rider, he being not a third party, when the accident took place owing to the rash and negligent driving of the scooter and not on the part of another vehicle. The Apex Court in United India Insurance Company (supra) has observed that the observation made in New India Assurance Co. Ltd. v. Asha Rani (2003) 2 SCC 233 in connection with carrying passenger in goods vehicle would apply with equal force to gratuitous passenger in other vehicle also. By following the said principle, the Apex Court in the said case has held that the Insurance Company owed no liability towards the injury suffered by the pillion rider as insurance policy is a statutory policy and hence it do not cover risk of death or bodily injury of gratuitous passenger. 17. A pillion rider in respect of a scooter in strict sense of the term may not be a gratuitous passenger, as in a given case, he or she may be a member of the family, friend or other relative and in the sense of the term used in common parlance he or she might not even be a passenger. Even then, he cannot be termed as third party so as to fasten the liability on the Insurance Company for payment of compensation only because of payment of premium for taking out "act only" policy. Even then, he cannot be termed as third party so as to fasten the liability on the Insurance Company for payment of compensation only because of payment of premium for taking out "act only" policy. The situation would be different if extra premium is paid covering the risk of the pillion rider in such a scooter. 18. As noticed above, in the schedule of premium paid, which is attached to the certificate of insurance produced by the Insurance Company before this Court, it appears that an amount of Rs.120/- has been paid as extra premium for personal accident benefit. The relevant portion of such schedule of premium is quoted below: Personal accident benefit [2 × 1,00,000] = Rs.120 19. In the proposal form submitted to the Appellant Insurance Company, which has been annexed as Annexure-2 to the application filed in Misc. Case No. 2475/08 by the Appellant, there is however, no mention about the limits of liability of the Insurance Company in respect of personal accident benefit. What has been mentioned in such proposal form is payment of Rs.120/- as extra premium covering the risk of pillion rider including the risk of the driver of the scooter. The Insurance Company's contention is that their liability is limited to the extent of rupees one lakh only. Such contention of the Appellant Insurance Company relating to the extent of liability cannot be accepted in view of the fact that no limits of liability has been mentioned in Annexure-2 (proposal form) filed in Misc. Case No. 2475/08 and as produced by the Insurance Company before this Court and also on the ground that under IMT-18 of the unfilled standard form containing the terms and conditions, as produced by the Insurance Company vide Misc. Case No. 2475/08, the limits of liability of Insurance Company in respect of permanent or total disablement arising from the injuries other than death loss of two limbs or sight of two eyes or one limb and sight of one eye is 100%. The relevant portion of the said IMT-18 reads as follows: IMT.18. Personal accident to unnamed hirer and unnamed pillion passengers. The relevant portion of the said IMT-18 reads as follows: IMT.18. Personal accident to unnamed hirer and unnamed pillion passengers. In consideration of the payment of an additional premium it is hereby understood and agreed that the insurer undertakes to pay compensation to any unnamed hirer/driver/any unnamed pillion/sidecar passenger on the scale provided below for bodily injury caused by violent, accidental external and visible means whilst mounting into/onto and/or dismounting from or travelling in/or the vehicle, insured which independently of any other cause shall within three calendar months of the occurrence of such injury result in : Details of injury Scale of compensation (i) Death 100% (ii) Loss of two limbs 100% or sight of two eyes or one limb and sight of one eye (iii) Loss of limb or sight of one eye 50% (iv) Permanent disablement from injuries other then named above 100% Provided always that (1) Compensation shall be payable under only one of the terms (i) to (iv) above in respect of any such person arising out of any one occurrence and total liability of the insurer shall not in the aggregate exceed the sum of Rs.... during any one period of insurance in respect of any such persons. (2) No compensation shall be payable in respect of death or injury directly or indirectly wholly or in part arising or resulting from or traceable to (a) intentional self-injury, suicide or attempted suicide, physical defect or infirmity or (b) an accident happening whilst such person is under the influence of intoxicating liquor or drugs. (3) Such compensation shall be payable only with the approval of the insured in the policy and directly to the injured person or his/her legal representative(s) whose receipt shall be a full discharge in respect of the injury of such person. (4) Not more than...persons/passengers are in the vehicle insured at the time of occurrence of such injury. Subject otherwise to the terms, exceptions, conditions and limitations of this policy. Delete if P.A. cover for unnamed pillion/side car passenger is not taken. The Capital Sum Insured (CSI) per passenger is to be inserted. 20. According to the Appellant Insurance Company the terms and conditions as stipulated in the standard form were also terms and conditions in the policy issued to the Respondent owner. Delete if P.A. cover for unnamed pillion/side car passenger is not taken. The Capital Sum Insured (CSI) per passenger is to be inserted. 20. According to the Appellant Insurance Company the terms and conditions as stipulated in the standard form were also terms and conditions in the policy issued to the Respondent owner. Therefore, IMT-18 is also applicable in the instance case, which provides for liability of the Insurance Company in respect of the personal accident relating to any unnamed pillion/side car passenger as 100%. However, such liability may be made limited to certain amount as stipulated in the first proviso to IMT-18 as noticed above. But in the instant case, whether there is any contract between the Insurance Company and the owner, limiting the insurer's liability, is not known as the Insurance Company, in spite of the opportunity given to produce the office copy of the police of insurance containing the terms and conditions of the policy kept by it for their record (it being a bilateral contract), has failed to produce the same. The explanation sought to be given in the application filed in Misc. Case No. 2475/2008, cannot be accepted being not believable. It is strange and not believable that the Insurance Company did not keep duly filled up terms and condition of the policy along with the policy docket. If they do not keep that, they are to suffer. The Insurance Company, in fact, though filed the certificate of insurance along with the policy schedule, did not file the copy of the policy, as noticed above, which is different from the certificate of insurance. In the absence of any proof limiting the liability in the contract of insurance as envisaged in the IMT-18, it is to be presumed that the liability of the Insurance Company is 100% in the instant case as the claimant has suffered permanent total disablement and paid extra premium of Rs.120/-. Merely because the figures "2 × 1,00,000" has been mentioned against the premium paid towards personal accident benefit, it cannot conclusively be held that the limits of liability of the Insurance Company in respect of the pillion rider has been limited to Rs.1,00,000/-, for the reasons recorded above. 21. The appeal filed by the Insurance Company, therefore, fails being devoid of merits. No costs. Appeal dismissed.