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2009 DIGILAW 1183 (HP)

NATIONAL INSURANCE COMPANY LTD. v. SHIV RAM

2009-12-03

V.K.AHUJA

body2009
JUDGMENT V.K. Ahuja, J.-This is an appeal filed by the appellant under Section 173 of the Motor Vehicles Act, 1988, hereinafter referred to as ‘the Act’, against the award passed by the Motor Accident Claims Tribunal, Solan, dated 3.11.2005, vide which the petition filed by the claimant/respondent No.1 under Section 166 of the Act as against respondents No.2 and 3 and the appellant, who was impleaded as respondent No.3, was allowed and an award for a sum of Rs.1,05,098/- was passed in favour of the claimant and as against the respondents, which was payable by the appellant. 2. Briefly stated the facts of the case are that a claim petition was filed by the claimant (respondent No.1 herein) under Section 166 of the Act for the grant of compensation. It was alleged by the claimant that he boarded a Canter Eicher No.HP-14-6586 from Solan for going to Delhi alongwith his agriculture produce. The vehicle met with an accident on 18.6.2003 at about 5.30 a.m. at Madroli (Panipat). The petitioner was admitted in the hospital at Panipat and then at Solan. The petitioner was then referred to Indira Gandhi Medical College, Shimla and thereafter to PGI, Chandigarh. The petitioner alleged that the accident took place due to rash or negligent driving of the driver of the vehicle, namely, respondent No.2. The petitioner alleged that he suffered multiple injuries, had been under treatment and claimed compensation to the extent of Rs.6.00 lacs. Respondent No.1 was impleaded as owner of the vehicle, while the appellant was impleaded as respondent No.3, being the insurance company with which the vehicle was insured. 3. The respondents contested the petition and the same was allowed as against the respondents and the amount was held payable by the appellant, as detailed above. 4. I have heard the learned counsel for the parties and have gone through the record of the case. 5. The submissions made by the learned counsel for the appellant were that there was no contract of insurance in between respondent No.1 and the appellant. It was further submitted that the policy was in the name of one Mohammad Jann. It was also submitted that the vehicle had been sold to respondent No.1, but since no information was given to the Insurance Company, therefore, the Insurance Company was not liable to pay the amount of compensation. It was further submitted that the policy was in the name of one Mohammad Jann. It was also submitted that the vehicle had been sold to respondent No.1, but since no information was given to the Insurance Company, therefore, the Insurance Company was not liable to pay the amount of compensation. It was also submitted that the insured was never made a party and as such, the Insurance Company is not liable to pay any compensation. 6. The learned counsel for the appellant/ Insurance Company placed reliance on the decision in Vinod Kumar and another versus Nirmala Devi and another, Latest HLJ 2009 (HP) 317, wherein it was held by a learned Single Judge of this Court that transfer of vehicle is not complete without compliance of mandatory requirements of law. The transferors continue to be the registered owner. Registered owner cannot be absolved of liability qua third party. It was also observed that the person in whose name the vehicle is registered is considered to be the owner and unless the name of the transferee is registered, he does not become the owner thereof. 7. Reliance was also placed upon the decision in Rikhi Ram and another versus Sukhrania and others, 2003 ACJ 534. The question of transfer of vehicle and the responsibility of the insured or the transferee was considered by their Lordships. It was observed that the vehicle was transferred by the insured prior to the date of accident but no intimation of transfer was given to the Insurance Company. The material question was whether liability of Insurance Company ceases so far as third party is concerned, when the vehicle is transferred and no intimation is given to the Insurance Company. It was held that the Insurance Company may recover the amount paid by it either from the insured or from the transferee of the vehicle. 8. On the other hand, the learned counsel for the owner/respondent No.2 submitted that the insurance policy was valid on the date of the accident and since the transfer had taken place during the subsistence of the insurance policy, the Insurance Company was liable to pay the amount in question. 9. 8. On the other hand, the learned counsel for the owner/respondent No.2 submitted that the insurance policy was valid on the date of the accident and since the transfer had taken place during the subsistence of the insurance policy, the Insurance Company was liable to pay the amount in question. 9. To substantiate his submissions, the learned counsel for respondent No.2 had also placed reliance upon the decision in Rikhi Ram and another versus Sukhrania and others, 2003 ACJ 534, wherein the following observations were made in paras 6 and 7: “6. On an analysis of sections 94 and 95, we further find that there are two third parties when a vehicle is transferred by the owner to a purchaser. The purchaser is one of the third parties to the contract and other third party is for whose benefit the vehicle was insured. So far, the transferee who is the third party in the contract, cannot get any personal benefit under the policy unless there is a compliance of the provisions of the Act. However, so far as third party injured or victim is concerned, he can enforce liability undertaken by the insurer. 7. For the aforesaid reasons, we hold that whenever a vehicle which is covered by the insurance policy is transferred to a transferee, the liability of insurer does not cease so far as the third party/victim is concerned, even if the owner or purchaser does not give any intimation as required under the provisions of the Act.” 10. The next decision relied upon was in G.Govindan versus New India Assurance Co.Ltd. and others, AIR 1999 Supreme Court 1398, wherein the following observations were made in paras 10, 13 and 15, which are relevant and are being reproduced below: “Both under the old Act and under the new Act the Legislature was anxious to protect the third party (victim) interest. What was implicit in the provisions of the old Act is now made explicit. The provisions under the new Act and the old Act are substantially the same in relation to liability in regard to third party. Thus a victim or the legal representatives of the victim cannot be denied the compensation by the insurer on the ground that the policy was not transferred in the name of the transferee. The provisions under the new Act and the old Act are substantially the same in relation to liability in regard to third party. Thus a victim or the legal representatives of the victim cannot be denied the compensation by the insurer on the ground that the policy was not transferred in the name of the transferee. However the third party here will not include a transferee whose transferor has not followed procedure for transfer of policy.” 11. Another decision relied upon by the learned counsel for respondent No.2 was in M/s. Complete Insulations (P) Ltd. versus New India Assurance Company Ltd., AIR 1996 Supreme Court 586. In that case, the question being considered by their Lordships was in regard to the damage to the vehicle and it was held that there was no policy in relation thereto transferred by insurer to transferee. The insurer would not be liable to make good the damage to the vehicle, which is not the case before this Court. 12. Coming to the facts of the present case, copy of the insurance policy proved on record is Ext.R-3/A, which shows that the vehicle was duly insured w.e.f. 7.7.2002 to 5.7.2003. The date of the accident in question is 18.6.2003, which clearly shows that the vehicle in question was duly insured with the appellant on the day of accident. However, according to the copy of the insurance policy Ext.R-3/A, the policy was taken by Mohammad Jann and, therefore, it was valid in so far as the said Mohammad Jann was concerned. The petitioner/claimant had impleaded respondent No.1 as owner in the claim petition and in reply by respondent No.1, this plea was not specifically taken that the vehicle was insured already in the name of the previous owner who is liable to pay the amount or he should be impleaded as a party. In reply filed by the appellant/Insurance Company, they took up the plea of denial alongwith all the pleas available to them, such as, the vehicle was being driven in violation of the provisions of the Act or that it was not having a valid registration route permit and the driver was not having effective driving license. It was also pleaded that the petitioner or respondents No.1 and 2 have not disclosed the insurance policy or its particulars. It was also pleaded that the petitioner or respondents No.1 and 2 have not disclosed the insurance policy or its particulars. It appears that during the evidence this question was established that the vehicle was not insured by its owner respondent No.1 and there is nothing on the record to show that any intimation was sent by the previous owner to the Insurance Company about the transfer of the vehicle. 13. The learned Tribunal had allowed the claim petition filed by the claimant and the Insurance Company/appellant was held liable to pay the amount since the vehicle was insured with them. 14. In view of the above discussion the findings of the learned trial Court are correct that the Insurance Company was liable to pay the amount in question in so far as the third parties are concerned. However, the grievance of the appellant is that there is no permission given to the appellant to claim the amount from the registered owner or the transferee i.e. respondent No.1. Thus, the appeal is liable to be allowed only to this extent that the appellant is at liberty to recover the amount in question from the registered owner or the transferee respondent No.1, as may be permissible under the law. The appeal is allowed to this extent, with no orders as to costs.