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2015 DIGILAW 1225 (KAR)

UNITED INDIA INSURANCE CO. LTD. v. S. N. SOMASHEKAR

2015-11-04

H.G.RAMESH

body2015
JUDGMENT : H.G.RAMESH, J. 1. This appeal is by an Insurer and is directed against the judgment and award dated 15.09.2010 passed in MVC No.1030/2009. 2. I have heard learned Counsel appearing for the appellant and the respondents. By the impugned judgment, the Tribunal has awarded a compensation of Rs.1,85,000/with interest at 6% p.a. to the claimant for the injuries suffered by him in a motor vehicle accident that occurred on 18.06.2009 due to rash and negligent driving of the autorickshaw cab bearing No.KA09A9251 in which he was traveling. The Tribunal has made the owner, Insurer & driver jointly & severally liable for the award. The Tribunal has directed the appellant-Insurer to deposit the award amount with liberty to recover it from the owner-Insured. 3. The sole contention urged by the learned Counsel for the appellant is that the insured Autorikshaw cab was plying beyond the area allowed by the transport permit resulting in violation of a condition of the Insurance policy. Hence, the Tribunal ought not to have made the appellant also liable for the award. In support of his contention, he relied on a decision of the Supreme Court in National Insurance Co. Ltd. vs. Challa Bharathamma [ (2004) 8 SCC 517 ] and specifically referred to para 12 thereof. 4. Learned Counsel appearing for the respondents supported the impugned judgment by relying on a Division Bench decision of this Court in K.V.Thimmegowda vs Kamalamma [I.L.R. 1991 Kar 4127] and specifically referred to para 7 thereof. 5. As could be seen from the copy of the transport permitEx.R4 issued for the period from 27.09.2007 to 26.09.2012, the autorickshaw cab was permitted to ply within the Mysuru city corporation limits and not more than 4 kms beyond the said limits. It is not in dispute that the autorickshaw was plying beyond the permitted limits at the time of accident. This is also the finding recorded by the Tribunal at para 17 of its judgment. The Insurance policy and the transport permit relating to the autorickshaw cab which are produced in evidence clearly prove the statutory defence available to an Insurer under Section 149(2)(a)(i)(c) of the Motor Vehicles Act, 1988. In this context, it is relevant to refer to paras 12 & 13 of Challa Bharathamma [ (2004)8 SCC 517 ] referred to by the appellant’s counsel: “12. In this context, it is relevant to refer to paras 12 & 13 of Challa Bharathamma [ (2004)8 SCC 517 ] referred to by the appellant’s counsel: “12. The High Court was of the view that since there was no permit, the question of violation of any condition thereof does not arise. The view is clearly fallacious. A person without permit to ply a vehicle cannot be placed on a better pedestal visavis one who has a permit, but has violated any condition thereof. Plying of a vehicle without a permit is an infraction. Therefore, in terms of Section 149(2) defence is available to the insurer on that aspect. The acceptability of the stand is a matter of adjudication. The question of policy being operative had no relevance for the issue regarding liability of the insurer. The High Court was, therefore, not justified in holding the insurer liable. 13. The residual question is what would be the appropriate direction. Considering the beneficial object of the Act, it would be proper for the insurer to satisfy the award, though in law it has no liability. In some cases the insurer has been given the option and liberty to recover the amount from the insured. For the purpose of recovering the amount paid from the owner, the insurer shall not be required to file a suit. It may initiate a proceeding before the Executing Court concerned 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. Before release of the amount to the claimants, owner of the offending vehicle shall 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 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 i.e. the insured. 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 i.e. the insured. In the instant case considering the quantum involved we leave it to the discretion of the insurer to decide whether it would take steps for recovery of the amount from the insured.” In view of the law laid down by the Supreme Court extracted above, the liability saddled on the insurance company is liable to be set aside and it is accordingly set aside. 6. The Division Bench decision of this Court in K.V.Thimmegowd are lied on by the counsel for the respondents stands impliedly overruled by the decision of the Supreme Court in Challa Bharathamma [ (2004) 8 SCC 517 ]. 7. In the light of the observations of the Supreme Court at para 13 of Challa Bharathamma extracted above, the order of ‘pay and recover’ made by the Tribunal is affirmed. However, Sri O.Mahesh, learned Counsel appearing for the appellant-Insurance Company submitted that the order of ‘pay and recover’ made by the Supreme Court at para 13 in Challa Bharathamma was made in exercise of the power under Article 142 of the Constitution, and, therefore, the Tribunal or this Court has no power to pass such an order. I am unable to accept this submission as the Supreme Court has not stated so in the judgment. 8. The appeal stands disposed of in terms stated above. The amount lying in deposit with this Court shall be transferred to the Tribunal forthwith. Appeal disposed of.