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2018 DIGILAW 794 (JHR)

Dasni Devi v. Rameshwar Mahto

2018-04-09

RAJESH KUMAR

body2018
ORDER : 1. The present appeal has been filed by the claimants against the order dated 07.10.2013 passed by District Judge-III-cum-Additional Claim Tribunal, Chatra in Claim Case No. 29 of 2006. 2. The case of the claimants is that on 10.10.2002 Mr. Budhan Bhuiyan had died in road accident due to rash and negligent driving of the driver of the offending vehicle bearing registration No.JH-13A-0790. The learned Claim Tribunal after evaluating the evidence etc. had Awarded a compensation of Rs. 3,20,000/-. As Rs.50,000/- has already been paid to the claimants and accordingly it has been directed to pay rest of the amount i.e. Rs.2,70,000/- by the defendant no.1 i.e. owner of the offending vehicle. 3. The appellants (claimants) in present case have confined his prayer only to the principle of “pay and recover” and not the quantum of compensation. 4. It has been argued on behalf of the appellants citing the judgment of the Apex Court that it is the primary liability of the insurance company to make the payment to the claimant as the vehicle in question is insured and further liberty should have been granted to the insurance company to recover the amount from the owner of the offending vehicle. 5. The counsel appearing for the appellants has relied upon the judgment reported in (2017) 4 SCC 796 : 2017(2) JLJR(SC) 18. Relevant paragraph-13 to 21 of the judgment is quoted hereinbelow:- “13. The only question, which arises for consideration in these appeals, is whether the appellants are entitled for an order against the insurer of the offending vehicle i.e. (Respondent 3) to pay the awarded sum to the appellants and then to recover the said amount from the insured (owner of the offending vehicle Tata sumo) Respondent 1 in the same proceedings. 14. The aforesaid question, in our opinion, remains no more res Integra. As we notice, it was the subject-matter of several decisions of this Court rendered by three-Judge Bench and two-Judge Bench in the past viz. National Insurance Co. Ltd. V. Baljit Kaur, National Insurance Co. Ltd. V. Challa Upendra Rao National Insurance Co. Ltd. V. Kaushalaya Devi, National Insurance Co. v. Roshan Lal and National Insurance Co. Ltd. V. Parvathneni. 15. This question also fell for consideration recently in National Insurance Co. National Insurance Co. Ltd. V. Baljit Kaur, National Insurance Co. Ltd. V. Challa Upendra Rao National Insurance Co. Ltd. V. Kaushalaya Devi, National Insurance Co. v. Roshan Lal and National Insurance Co. Ltd. V. Parvathneni. 15. This question also fell for consideration recently in National Insurance Co. Ltd. V. Saju P.Paul wherein this Court took note of entire previous case law on the subject mentioned above and examined the question in the context of Section 147 of the Act. While allowing the appeal filed by the insurance company by reversing the judgment of the High Court, it was held on facts that since the victim was travelling in offending vehicle as “gratuitous passenger” and hence, the insurance company cannot be held liable to suffer the liability arising out of accident on the strength of the insurance policy. However, this Court keeping in view the benevolent object of the Act and other relevant factors arising in the case, issued the directions against the insurance company to pay the awarded sum to the claimants and then to recover the said sum from the insured in the same proceedings by applying the principle of “pay and recover”. 16. R.M. Lodha, J. (as his Lordship then was and later became CJI) speaking for the Bench held in paras 20 and 26 as under: (Saju P. Paul Case, SCC pp. 52 & 55) “20. The next question that arises for consideration is whether in the peculiar facts of this case a direction could be issued to the Insurance company to first satisfy the awarded amount in favour of the claimant and recover the same from the owner of the vehicle (Respondent 2 herein). 26. The pendency of consideration of the above questions by a larger Bench does not mean that the course that was followed in Baljit Kaur and Challs Upendra Rao should not be followed, more so in a peculiar fact situation of this case. In the present case, the accident occurred in 1993. At that time, the claimant was 28 years old. He is now about 48 years. The claimant was a driver on heavy vehicle and due to the accident he has been rendered permanently disabled. He has not been able to get compensation so far due to the stay order passed by this Court. He cannot be compelled to struggle further for recovery of the amount. He is now about 48 years. The claimant was a driver on heavy vehicle and due to the accident he has been rendered permanently disabled. He has not been able to get compensation so far due to the stay order passed by this Court. He cannot be compelled to struggle further for recovery of the amount. The Insurance Company has already deposited the entire awarded amount pursuant to the order of this Court passed on 1.8.2011 [National Insurance Co. Ltd. V. Saju P. Paul] and the said amount has been invested in a fixed deposit account. Having regard to these peculiar facts of the case in hand, we are satisfied that the claimant (Respondent 1) may be allowed to withdraw the amount deposited by the Insurance Company before this Court along with accrued interest. The Insurance Company (the appellant) thereafter may recover the amount so paid from the owner (Respondent 2 herein). The recovery of the amount by the Insurance Company from the owner shall be made by following the procedure as laid down by this Court in Challa Updndra Rao.” 17. The facts of the case at hand are somewhat identical to the facts of the case mentioned supra because here also we find that the deceased were found travelling as “gratuitous passengers” in the offending vehicle and it was for this reason, the insurance companies were exonerated. In Saju P. Paul case also having held that the victim was “gratuitous passenger”, this Court issued directions against the insurer of the offending vehicle to first satisfy the awarded sum and then to recover the same from the insured in the same proceedings. 18. The learned counsel for the Respondent 3 (United India Insurance Co. Ltd.), however, contended that the facts of the case at hand are not identical to the one involved in Saju P. Paul and hence the law laid down therein cannot be applied to the facts of the case at hand. The learned counsel pointed out that firstly, the awarded compensation in this case is quite substantial and secondly, it is not yet paid to the claimants. The learned counsel also submitted that since the question involved herein is referred to a larger Bench and hence this Court should not give such directions, as prayed by the appellants, against the insurance company. 19. We find no merit in any of the submissions. The learned counsel also submitted that since the question involved herein is referred to a larger Bench and hence this Court should not give such directions, as prayed by the appellants, against the insurance company. 19. We find no merit in any of the submissions. Firstly, as mentioned above, we find marked similarity in the facts of this case and the one involved in Saju P.Paul Case. Secondly, merely because the compensation has not yet been paid to the claimants though the case is quite old (16 years) like the one in Saju P.Paul case, it cannot be a ground to deny the claimants the relief claimed in these appeals. Thirdly, this Court has already considered and rejected the argument regarding not granting of the relief of the nature claimed herein due to pendency of the reference to a larger Bench as would be clear from para-26 of the judgment in Saju. P.Paul case. That apart, the learned counsel for the appellants stated at the Bar that the reference made to the larger Bench has since been disposed of by keeping the issue undecided. It is for this reason also, the argument does not survive any more. 20. It is for all these reasons, we find no good ground to take a different view than the one consistently being taken by this Court in all previous decisions, which are referred supra, in this regard. 21. In view of the foregoing discussion, we are of the view that the direction to United India Insurance Co. Ltd. (Respondent 3)- they being the insurer of the offending vehicle which was found involved in causing accident due to negligence of its driver needs to be issued directing them (United India Insurance Co. Ltd Respondent 3) to first pay the awarded sum to the appellants (claimants) and then to recover the paid awarded sum from the owner of the offending vehicle (Tata Sumo) Respondent 1 in executing proceedings arising in this very case as per the law laid down in para-26 of Saju P.Paul case quoted supra. 6. Learned counsel for the appellant has also relied upon the judgment rendered in the case of National Insurance Co. Ltd. Vs. Sawarn Singh & Ors. reported in (2004)3 SCC 297 . Relevant para-110 of the aforesaid judgment is quoted hereunder:- 110. 6. Learned counsel for the appellant has also relied upon the judgment rendered in the case of National Insurance Co. Ltd. Vs. Sawarn Singh & Ors. reported in (2004)3 SCC 297 . Relevant para-110 of the aforesaid judgment is quoted hereunder:- 110. The summary of our findings to the various issues as raised in these petitions are as follows: “(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object. (ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the said act. (iii) The breach of policy condition, e.g. disqualification of driver or invalid driving license of the driver, as contained in sub-section (2)(a)(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving license or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time. (iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish ‘breach’ on the part of the owner of the vehicle; the burden of proof where for would be on them. (v) The Court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case. (v) The Court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case. (vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid license by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving license is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply “the rule of main purpose” and the concept of “fundamental breach” to allow defences available to the insured under Section 149(2) of the Act. (vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving license produced by the driver, (a fake one or otherwise), does not fulfill the requirements of law or not will have to be determined in each case. (viii) xxx (ix) xxx (x) Where on adjudication of the claim under the Act the Tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of Section 149(2) read with sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third party under the award of the Tribunal Such determination of claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the Tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the Tribunal. The certificate will be issued for the recovery as arrears of land revenue only if, as required by sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the Tribunal. (xi) The provisions contained in sub-section (4) with proviso there under and sub-section (5) which are intended to cover specified contingencies mentioned therein to enable the insurer on behalf of the insured can be taken recourse of by the Tribunal and be extended to claims and defences of insurer against insured by, relegating them to the remedy before, regular Court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victim.” 7. On the strength of above judgment, learned counsel for the appellant has contended that as the law is settled to the extent that if any accident take place with the motor vehicle and if the motor vehicle in question is insured, then the principle of “pay and recover” will apply. In such case, it is duty of the insurance company to satisfy the claim and to recover the amount so paid from the owner of the offending vehicle for breach of terms and conditions of the insurance policy. 8. On the other hand, learned counsel for the insurance company has contended that the above order of the Apex Court has been passed under Article 142 of the Constitution of India and as such pay and recover is not law of the land and the same is not binding on the High Court. 9. Mere perusal of the order of the Apex Court, as discussed above, clarifies that the law has been laid down under Article 141 of the Constitution of India and not under Article 142 of the Constitution of India. Since, the above judgment has not been passed under Article 142 and as such all the Courts in India are duty bound to follow the law as declared by Apex Court. 10. Since, the above judgment has not been passed under Article 142 and as such all the Courts in India are duty bound to follow the law as declared by Apex Court. 10. The Apex Court has clearly held that if any accident take place with a motor vehicle and if the motor vehicle is insured then it is duty of the insurance company to make the payment to the claimant and thereafter it can be recovered from the owner of the offending vehicle. It has been mandated by Apex Court that the Courts in India should pass composite order, if it is held that liability is upon the owner of the offending vehicle for breach of any terms of the insurance then order should be passed, directing the insurance company to make the payment first and then to recover the same from the owner through certificate proceeding. 11. This Court is of the opinion, whenever a claim petition is filed, it is duty of Claim Tribunal to put restriction upon sale/transfer of offending vehicle, till disposal of claim petition. Restriction may be “not to sale/transfer offending vehicle without permission of Claim Tribunal”. In future, if permission is sought for sale/transfer, it may be granted on furnishing adequate securities to the satisfaction of Tribunal. 12. Above, restriction will ensure recovery of Awarded amount from owner of the offending vehicle either in favour of insurance company or in favour of claimant. 13. In present case, the Claim Tribunal while deciding the issue has clearly returned the finding that Budhan Bhuiyan had died in motor vehicle accident due to rash and negligent driving of the tractor bearing registration No.JH-13A-0790, in view of this finding which has not been challenged, it is held that deceased has died due to rash and negligent driving of the offending vehicle. 14. The defense taken by the insurance company is that the deceased was a laborer and being a gratuitous passenger was not covered with the insurance policy of the offending vehicle. 15. The Tribunal has returned the finding that deceased was traveling on the trailor of the offending tractor and it comes under the definition of goods carriage. 14. The defense taken by the insurance company is that the deceased was a laborer and being a gratuitous passenger was not covered with the insurance policy of the offending vehicle. 15. The Tribunal has returned the finding that deceased was traveling on the trailor of the offending tractor and it comes under the definition of goods carriage. Deceased-Budhan Bhuiyan was not on duty and he was neither owner nor driver of the offending tractor rather he was gratuitous passenger and accordingly the insurance company cannot be held liable for the same and the liability is upon the owner of the offending vehicle. 16. In view of the facts of the present case, so far as, liability is concerned that has rightly been fastened upon the owner of the offending vehicle. 17. As per the mandate of the Apex Court as discussed above, claimant cannot be allowed to suffer and once the vehicle in question was insured then the insurance company must pay the amount to the claimant with a liberty to recover the same from the owner of the vehicle. 18. Accordingly, respondent no.2 (Insurance Company) is directed to make payment to the claimants, as per Award, further Tribunal is directed to do the needful for recovery of Awarded amount from owner of the offending vehicle (respondent no.1) as arrears of Land Revenue and for this, to issue certificate to the Collector as provided under Bihar, Orissa & Jharkhand Public Demands Recovery Act, 1914. 19. With above direction, present appeal is allowed to the extent indicated above.