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2015 DIGILAW 1728 (HP)

Oriental Insurance Company v. Kaushalya Devi

2015-11-27

MANSOOR AHMAD MIR

body2015
JUDGMENT : Mansoor Ahmad Mir, J. This judgment shall govern all the five appeals because these are outcome of one motor vehicular accident. 2. These appeals are outcome of the judgments and awards made by the Motor Accident Claims Tribunal-II, Fast Track Court, Kullu, H.P. (for short "the Tribunal") in five claim petitions on the different dates, which were filed by the claimants being victims of the vehicular accident for grant of compensation, as per the breakups given in the respective claim petitions (for short "the impugned awards"). 3. The claimants have averred in the claim petitions that the driver, namely Shri Nup Ram, has driven the offending vehicle, i.e. bus, bearing registration No. HP-661431, rashly and negligently on 21.05.2007, near place Diffi, at about 8.30 A.M. and caused the accident in which five passengers sustained injuries and succumbed to the injuries and 79 passengers sustained injuries. 4. Out of the said passengers, victims/claimants have filed only five claim petitions and compensation came to be awarded in favour of the claimants, details of which are given in the respective impugned awards. 5. The claimants, the owner-insured and the driver of the offending vehicle have not questioned any of the impugned awards on any count, thus, all the impugned awards have attained finality so far the same relate to them. 6. The insurer has questioned the impugned awards on the grounds that the owner-insured has committed breach for the reason that the seating capacity of the offending vehicle was 42 and 84 persons were travelling in the same at the time of the accident, thus, was being driven in violation of the insurance policy read with the mandate of Sections 147 to 149 of the Motor Vehicles Act, 1988, (for short "the MV Act") and the amount awarded in the respective impugned awards is excessive. 7. Thus, the following points are to be determined in these appeals: (i) Whether the owner-insured has committed breach as more than prescribed/permitted passengers were travelling as passengers in the offending vehicle at the time of the accident? (ii) Whether the amount awarded is excessive or otherwise? 8. It was for the insurer to plead and prove that the owner-insured has committed any willful breach, has failed to do so. (ii) Whether the amount awarded is excessive or otherwise? 8. It was for the insurer to plead and prove that the owner-insured has committed any willful breach, has failed to do so. No doubt, more than prescribed passengers were travelling in the offending vehicle at the time of the accident, but only five persons have filed the claim petitions before the Tribunal. The seating capacity of the offending vehicle was 42' and the factum of the insurance is not in dispute. Thus, the risk of 42 passengers is covered. 12. It is beaten law of land that the insurer has to satisfy the award to the extent of the risk covered and if the claim petitions are more than the risk covered, then it is for the insured-owner to satisfy the same. 13. My this view is fortified by the judgment of the Apex Court in the case titled as United India Insurance Company Limited versus K.M. Poonam & others, reported in 2011 ACJ 917. It is apt to reproduce para 24 of the judgment herein:- “24. The liability of the insurer, therefore, is confined to the number of persons covered by the insurance policy and not beyond the same. In other words, as in the present case, since the insurance policy of the owner of the vehicle covered six occupants of the vehicle in question, including the driver, the liability of the insurer would be confined to six persons only, notwithstanding the larger number of persons carried in the vehicle. Such excess number of persons would have to be treated as third parties, but since no premium had been paid in the policy for them, the insurer would not be liable to make payment of the compensation amount as far as they are concerned. However, the liability of the Insurance Company to make payment even in respect of persons not covered by the insurance policy continues under the provisions of subsection (1) of Section 149 of the Act, as it would be entitled to recover the same if it could prove that one of the conditions of the policy had been breached by the owner of the vehicle. In the instant case, any of the persons travelling in the vehicle in excess of the permitted number of six passengers, though entitled to be compensated by the owner of the vehicle, would still be entitled to receive the compensation amount from the insurer, who could then recover it from the insured owner of the vehicle." 14. It is also apt to reproduce para 15 of the judgment of the Apex Court in the case titled as National Insurance Company Limited versus Anjana Shyam & others, reported in 2007 AIR SCW 5237, herein:- “15. In spite of the relevant provisions of the statute, insurance still remains a contract between the owner and the insurer and the parties are governed by the terms of their contract. The statute has made insurance obligatory in public interest and by way of social security and it has also provided that the insurer would be obliged to fulfil his obligations as imposed by the contract and as overseen by the statute notwithstanding any claim he may have against the other contracting party, the owner, and meet the claims of third parties subject to the exceptions provided in Section 149(2) of the Act. But that does not mean that an insurer is bound to pay amounts outside the contract of insurance itself or in respect of persons not covered by the contract at all. In other words, the insured is covered only to the extent of the passengers permitted to be insured or directed to be insured by the statute and actually covered by the contract. The High Court has considered only the aspect whether by overloading the vehicle, the owner had put the vehicle to a use not allowed by the permit under which the vehicle is used. This aspect is different from the aspect of determining the extent of the liability of the insurance company in respect of the passengers of a stage carriage insured in terms of Section 147(1)(b)(ii) of the Act. We are of the view that the insurance company can be made liable only in respect of the number of passengers for whom insurance can be taken under the Act and for whom insurance has been taken as a fact and not in respect of the other passengers involved in the accident in a case of overloading.” 15. We are of the view that the insurance company can be made liable only in respect of the number of passengers for whom insurance can be taken under the Act and for whom insurance has been taken as a fact and not in respect of the other passengers involved in the accident in a case of overloading.” 15. This Court in batches of appeals, FAO No. 257 of 2006, titled as National Insurance Company Ltd. versus Smt. Sumna @ Sharda & others, being the lead case, decided on 10.04.2015, and FAO No. 224 of 2008, titled as Hem Ram & another versus Krishan Chand & another, being the lead case, decided on 29.05.2015, has laid down the same principle, which is not disputed by the learned counsel for the insurer. 16. Learned counsel for the insurer argued that the amount awarded in all the claim petitions, on the face of it, is excessive. 17. I have gone through the record and the assessment made and am of the considered view that the insurer cannot question the impugned awards on account of adequacy of compensation. However, perusal of the files does disclose that the amount awarded is not excessive in any way. 18. Having glance of the above discussions, the impugned awards are upheld and the appeals are disposed of, as indicated hereinabove. 19. Registry is directed to release the awarded amount in favour of the claimants strictly as per the terms and conditions contained in the respective impugned awards after proper identification. 20. Send down the record after placing copy of the judgment on each of the Tribunal's files.