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2011 DIGILAW 776 (BOM)

National Insurance Co. Ltd. v. Maruti

2011-07-05

R.M.BORDE

body2011
JUDGMENT : R.M. Borde, J. Heard. 2. Admit. With the consent of the parties, the appeal is taken up for final disposal at admission stage. 3. The only substantial question of law that arises for consideration in this appeal is as formulated in ground No. 3 in the memorandum of appeal which is reproduced as below : 3. That the learned Court below has failed to appreciate that the deceased was not holding or possessing any kind of valid and effective Driving Licence and the learned Commissioner did not address itself to this vital question and, thereby arrived at wrong conclusions. 4. This appeal is preferred by original respondent No. 2 the National Insurance Company raising exception to the judgment and award passed by the Commissioner for Workmen's Compensation and Civil Judge, Sr. Dn., Beed in Workmen Compensation Petition No. 12/2003 decided on 6.12.2007. 5. Respondent Nos. 1 and 2 herein/original claimants presented claim petition claiming compensation to the tune of Rs. 2,21,370/- along with interest from the date of presentation of the application till realisation of the amount. It is the case of the claimants that deceased Abadeo s/o Maruti Jagtap who was the son of the petitioners was in employment with the original respondent No. 1 i.e. owner of the vehicle as driver to drive truck bearing No. MH 09 L 907. On the date of the accident, deceased was proceeding from Pandharpur to Baramati. At that time, tempo bearing No. MH 06 T 6766 which was driven in rash and negligent manner, came from Baramati side. Driver of the tempo lost control and dashed against the truck which was being driven by the deceased. As a result of the impact, deceased lost control of the truck which turned turtle. Deceased sustained injuries and died on the spot. One Jyotiram lodged information with Khandala police station in respect of the accident. Police registered crime against the tempo driver. Claimants being dependent on the deceased have presented application claiming compensation. According to the claimants, deceased was 22 years of age and was receiving salary to the tune of Rs. 2,000/- per month. Even assuming that the amount to the extent of 50% was spent by the deceased for himself, applying the multiplier as provided-under the Schedule, compensation amount receivable by the claimants comes to Rs. 2,21.370/-. According to the claimants, deceased was 22 years of age and was receiving salary to the tune of Rs. 2,000/- per month. Even assuming that the amount to the extent of 50% was spent by the deceased for himself, applying the multiplier as provided-under the Schedule, compensation amount receivable by the claimants comes to Rs. 2,21.370/-. Petitioners initially presented Motor Accident Claim Petition before the Motor Accident Claims Tribunal, Beed. However, the same was withdrawn and the claimants proceeded to file claim petition under the provisions of Workmen's Compensation Act. Original respondent No. 1 caused appearance and filed his written statement. It is contended that the truck in question was sold to original respondent No. 3 prior to the accident and as such liability to pay compensation rests on original respondent No. 3. Facts stated in the claim petition in respect of employment of deceased with respondent No. 1 have been denied by the concerned respondent. Original respondent No. 2 insurance company filed written statement and controverted the claim on several grounds. One of the grounds raised by original respondent No. 2 is in respect of breach of terms of insurance policy. According to the insurer, deceased was not possessing driving licence at the time of accident and as such there is breach of terms and conditions incorporated in the insurance policy and as such insurer shall not be held liable in respect of payment of compensation. Considering the rival contentions raised by the parties and on consideration of the evidence lead by the claimants as well as the respondents, the Commissioner for Workmen's Compensation arrived at conclusion that the claimants have established the claim and as such passed award in their favour holding them entitled to receive the amount as claimed by them alongwith interest at the rate of 9% per annum from the date of presentation of the petition till realisation of amount. Original respondent No. 2 insurer has-raised challenge to the order passed by the Commissioner for Workmen's Compensation by presenting the instant appeal. 6. The only ground agitated in the appeal is in respect of breach of specific terms of policy in respect of holding of driving licence by the deceased at the time of accident, Mr. Upadhye, learned Counsel for the appellant has invited my attention to paragraph No. 9 of the petition which is reproduced as below : 9. 6. The only ground agitated in the appeal is in respect of breach of specific terms of policy in respect of holding of driving licence by the deceased at the time of accident, Mr. Upadhye, learned Counsel for the appellant has invited my attention to paragraph No. 9 of the petition which is reproduced as below : 9. That as already stated above, deceased was employed by defendant No. 1 on her truck referred to above with the monthly salary of Rs. 2,000/-. However, though he was working with defendant No. 1 as driver, he had no valid driving licence at the relevant time. As a matter of fact, he was in the employment of the owner, defendant No. 1, as cleaner, but defendant No. 1 engaged him to drive her aforesaid truck; as such deceased was her employee, within the definition of Workmen's Compensation Act. In the written statement presented by the insurance company, contentions raised in paragraph No. 9 of the application to the effect that the deceased was not holding driving licence at the time of accident is admitted by the insurance company. It is further averred that there is breach of specific term and condition of the insurance policy. As such, the insurer is not liable to reimburse the owner. Learned Counsel for the appellant has placed reliance on the judgment in the matter of New India Assurance Co. Ltd. v. Kusum and others 2010 (2) ACC 518 (SC). The Apex Court-has observed in paragraph Nos. 7 and 8 of the judgment thus: 7. An owner of a vehicle in terms of the provisions of the Motor Vehicles Act is legally obligated to get the vehicle insured. The rights and liabilities of the parties to the contract of insurance would be governed thereby subject to the provisions of the Motor Vehicles Act. One of the conditions which would make the Insurance Company liable to reimburse the owner of the vehicle in respect of payment of the amount of compensation in favour of a claimant is that the driver of the vehicle must possess a valid driving licence. The owner has a duty to see that a vehicle is driven by a person having a valid driving licence. The licence of the driver of the said bus was proved to be invalid. The owner has a duty to see that a vehicle is driven by a person having a valid driving licence. The licence of the driver of the said bus was proved to be invalid. The owner did not raise any contention that he has used due diligence in allowing the drier to drive the vehicle. 8. The Courts, however, keeping in view the social justice doctrine in mind where for the Act was enacted and in the interest of the claimants had been passing such orders. The High Court has noticed the decision of this Court in Nanjappa (supra), wherein it was held: 8. Therefore, while setting aside the judgment of the High Court we direct in terms of what has been stated in Baljit Kaur case that the insurer shall pay the quantum of compensation fixed by the Tribunal, about which mere was no dispute raised, to the respondent claimants within three months from today. For the purpose of recovering the same from the insured, the insurer shall not be required to file a suit. It may initiate a proceeding before the Executing Court concerned, if the dispute between the insurer and the owner was the subject-matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. Before release of the amount to the claimants, owner of the vehicle shall be issued a notice and he shall be required to furnish security for the entire amount which the insurer will pay to the claimants. The offending vehicle shall be attached, as a part of the security. If necessity arises the Executing Court shall take assistance of the Regional Transport Authority concerned. The Executing Court shall pass appropriate orders in accordance with law as to the manner in which the insured, owner of the vehicle shall make payment to the insurer. In case there is any default it shall be open to the Executing Court to direct realization by disposal of the securities to be furnished or from any other property or properties of the owner of the vehicle, the insured. The appeal is disposed of in the aforesaid terms, with no order as to costs. As noticed hereinbefore, similar directions were also issued in National Insurance Co. Ltd. v. Baljit Kaur, 2004 (15) AIC 436 (SC) : 2004 (1) ACC 259 (SC) in the following terms : 20. The appeal is disposed of in the aforesaid terms, with no order as to costs. As noticed hereinbefore, similar directions were also issued in National Insurance Co. Ltd. v. Baljit Kaur, 2004 (15) AIC 436 (SC) : 2004 (1) ACC 259 (SC) in the following terms : 20. The upshot of the aforementioned discussions is that instead and in place of the insurer the owner of the vehicle shall be liable to satisfy the decree. The question, however, would be as to whether keeping in view the fact that the law was not clear so long such a direction would be fair and equitable. We do not think so. We, therefore, clarify the legal position which shall have prospective effect. The Tribunal as also the High Court had proceeded in terms of the decision of this Court in Satpal Singh (supra). The said decision has been overruled only in Aska Rani (supra), We, therefore, are of the opinion that the interest of justice will be sub served if the appellant herein is directed to satisfy the awarded amount in favour of the claimant, if not already satisfied, and recover the same from the owner of the vehicle. For the purpose of such recovery, it would not be necessary for the insurer to file a separate suit but it may initiate a proceeding before the Executing Court as if the dispute between the insurer and the owner was the subject-matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. We have issued the aforementioned directions having regard to the scope and purport of section 168 of the Motor Vehicles Act, 1988, in terms whereof, it is not only entitled to determine the amount of claim as put forth by the claimant for recovery thereof from the insurer, owner or driver of the vehicle jointly or severally but also the dispute between the insurer on the one hand and the owner or driver of the vehicle involved in the accident inasmuch as can be resolved by the Tribunal in such a proceeding. Yet again, in National Insurance Co. Yet again, in National Insurance Co. Ltd. v. Kusum Rai, 2006 (41) AIC 108 (SC) : 2006 (2) ACC 19 (SC) it was held : Thus, although we are of the opinion that the appellant was not liable to pay the claimed amount as the driver was not possessing a valid licence and the High Court was in error in holding otherwise, we decline to interfere with the impugned award, in the peculiar facts and circumstances of the case, in exercise of our jurisdiction under Article 136 of the Constitution but we direct that the appellant may recover the amount from the owner in the same manner as was directed in Nanjappan (supra). Yet again in Oriental Insurance Co. Ltd. Vs. Zaharulnisha and Others, this Court held : 22. In the result, the appeal is allowed to the limited extent and it is directed that the appellant Insurance Company though not liable to pay the amount of compensation, but in the nature of this case shall satisfy the award and shall have the right to recover the amount deposited by it along with interest from the owner of the vehicle viz., Respondent No. 8, particularly in view of the fact that no appeal was preferred by him nor has he chosen to appear before this Court to contest this appeal. This direction is given in the light of the judgments of this Court in National Insurance Co. Ltd. v. Baljit Kaur and Deddappa v. National Insurance Co. Ltd. Again in Dedappa v. National Insurance Co. Ltd., 2008 (61) AIC 10 (SC) : 2008 (2) ACC 267 (SC) it was held : 28. However, as the appellant hails from the lowest strata of society, we are of the opinion that in a case of this nature, we should, in exercise of our extraordinary jurisdiction under Article 142 of the Constitution of India, direct Respondent 1 to pay the amount of claim to the appellants herein and recover the same from the owner of the vehicle viz., Respondent 2, particularly in view of the fact that no appeal was preferred by him. We direct accordingly. 7. The Commissioner for Workmen's Compensation while deciding the matter has observed that the insurance company has not discharged the burden of proving that the deceased was not possessing valid driving licence and there is breach of terms of the policy. We direct accordingly. 7. The Commissioner for Workmen's Compensation while deciding the matter has observed that the insurance company has not discharged the burden of proving that the deceased was not possessing valid driving licence and there is breach of terms of the policy. It is to be noted that the document i.e. insurance policy is placed on record and it is not controverted that one of the terms to be satisfied for raising the claim is in respect of possession of valid driving licence. The claimants themselves in paragraph No. 9 of the application have contended that the deceased was not having valid driving licence at the relevant time and moreover he was in the employment of the owner as a cleaner and was not supposed to drive the truck. Thus contention raised in paragraph No. 9 of the application has been admitted by the insurance company. The contention which is raised in the application which has not been controverted by the insurance company/respondent is not required to be proved by leading evidence. The fact which is admitted in the claim petition ought to have been accepted by the Commissioner for Workmen's Compensation and finding ought to have been recorded that there is breach of specific term incorporated in the insurance policy. The Commissioner for Workmen's Compensation has erred in fixing liability in respect of payment of compensation on original respondent No. 2 i.e. appellant herein. 8. For the reasons stated above, appeal presented by the insurance company deserves to be allowed and the same is accordingly allowed. Order passed by the Commissioner for Workmen's Compensation holding original respondent No. 2 appellant herein liable to pay compensation along with interest is set aside. It is hereby declared that original respondent No. 2/appellant herein shall not be held liable to pay the amount of compensation and it would be open for the claimants to recover the amount from the owner of the truck. 9. It is stated by the appellant that the amount awarded by the Commissioner for Workmen's Compensation has been deposited before the Trial Court and the same has also been withdrawn by the original claimants. In these circumstances, it would be open for the insurance company to recover the amount from the owner of the vehicle. 9. It is stated by the appellant that the amount awarded by the Commissioner for Workmen's Compensation has been deposited before the Trial Court and the same has also been withdrawn by the original claimants. In these circumstances, it would be open for the insurance company to recover the amount from the owner of the vehicle. For the purpose of recovering amount from the owner, insurance company shall not be required to file the suit but it may initiate a proceeding before Executing Court as if dispute between insurer and owner was the subject-matter of determination before Tribunal and the issue is decided against the owner and in favour of insurer. Appeal is thus allowed in terms as stated above. In the facts and circumstances of the case, there shall be no order as to costs.