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Madhya Pradesh High Court · body

2019 DIGILAW 162 (MP)

Brij Mohan Gupta v. Oriental Insurance Company

2019-02-21

G.S.AHLUWALIA

body2019
JUDGMENT : 1. This First Appeal under Section 96 of CPC has been filed against the judgment and decree dated 1st May, 2002 passed by Third Additional District Judge, Morena in Civil Suit No.68-A of 2000. 2. The necessary facts for the disposal of the present appeal in short are that the respondent No.1 had filed a civil suit against the appellant for recovery of Rs.47,061.46/-+ interest of Rs.7,050/-, total Rs.54,111.46/-. It is the case of the respondent No.1 that the respondent No.1 is a Company registered under the Companies Act and is carrying on its business in the name and style of ''Oriental Insurance Company Limited'' and its Regional Office is situated at Asif Ali Road, New Delhi. The Company has its Divisional Office at Gwalior and the District Office situated at Morena falls within the territorial jurisdiction of Divisional Office, Gwalior and accordingly, the Senior Divisional Manager has been authorized and is competent to file the suit on behalf of Oriental Insurance Company Limited. It is the case of the respondent No.1 that the appellant Brij Mohan Gupta is the registered owner of truck bearing registration No.MNA415, which is a goods carriage and is used for transporting the goods from one place to another. If the transporter fails to deliver the goods at the destination, then the owner and the driver of the truck are liable to pay the 2 damages to the consignor and if the goods are insured, then the Insurance Company is liable to pay the damages. It was further pleaded that as the defendants No.1 and 2 have not informed that whether they are having any Insurance Policy in their favour or not, therefore, the suit is being filed against them only. It was further pleaded that the defendant No.3 is the New Sangram Transport Service, who had arranged for transporting the goods and therefore, it is also responsible for transportation of goods. It was further pleaded that the defendant No.3 is the New Sangram Transport Service, who had arranged for transporting the goods and therefore, it is also responsible for transportation of goods. It was further pleaded that M/s. Goyal Industries, Old Mill Area Road, Morena (proforma defendant No.4) had entered into an insurance agreement with the plaintiff/respondent No.1, that since they are in the business of manufacturing of oil and they are required to transport the final product by Railways as well as by goods carriage and it is their duty to transport the goods in a secured manner, accordingly, an insurance agreement dated 06-04-1987 was executed with a condition that whenever the defendant No.4 would transport/dispatch the manufactured oil in the name and style of Tansen Brand Oil, then its information in advance shall be given to the respondent No.1/plaintiff and the respondent No.1 would insure the said goods till it reaches the destination. It was further pleaded that in case, if the goods are destroyed, stolen or damaged because of an accident, then the Insurance Company would be responsible to assess the damages and to pay the cost of said damages to the Insured and the Insured would give a letter of subrogation and the Insurance Company would be entitled to recover the damages paid to the Insured from the concerning person or the concerning Insurance Company. Such type of Insurance is known as Marine Insurance and is governed by provisions of the Carriers Act. It was further pleaded that on 18-03-1988 M/s. Goyal Industries, had dispatched 640 containers of Tansen Brand Mustard Oil. The said consignment was sent through the truck of the appellant. The total cost of the goods was Rs.1,96,800/-. The fare for transporting the oil was fixed at Rs.4,515/-, which was payable after the goods reaches the destination. It was also agreed upon between the respondent No.3 (Transporter) and the respondent No.4 (Insured) that in case, the goods do not reach to the destination, then the defendants No.1 to 3 would pay the cost of damaged or stolen goods to the defendant No.4 (Insured). It was further pleaded that as per the provisions of Section 8 of Carriers Act, the defendants No.1 to 3 were under legal obligation to pay the cost of theft or damage to the defendant No.4. It was further pleaded that as per the provisions of Section 8 of Carriers Act, the defendants No.1 to 3 were under legal obligation to pay the cost of theft or damage to the defendant No.4. On 18/03/1988, 640 containers of oil worth Rs.1,96,800/-were loaded on the truck bearing registration No. MNA 415 belonging to the defendant No.1. The entire goods were handed over by the defendant No.4 (consignor) to the defendants No.1 to 3 after giving full details of the same along with the bilti and bills. The defendants No.2 and 3 had prepared a bilti on behalf of the defendant No.1 and the same was handed over to the defendant No.4. The information with regard to transportation of goods was given to the Insurance Company on the very same day, as a result of which the goods belonging to the defendant No.4 got insured as per the Marine Insurance Policy. On 18/03/1988, the truck started for its destination but it met with an accident near Kanpur. The accident took place because of rash and negligent driving of the driver, as a result of which 228 containers of oil were completely damaged, whereas 412 containers of oil were damaged. The defendants immediately went to the place of accident and at that time, the driver of the truck as well as his associate employees were present on the spot. Damage was assessed by the defendants. The defendant No.3 had admitted that the loss to the tune of Rs.60,000/-has been caused and accordingly, loss certificate dated 28-03-1988 to the tune of Rs.60,000/-was also given by the owner of defendant No.3 to the defendant No.4. Accordingly, the defendant No.4 claimed Rs.55,333.86/-from the respondent No.1/plaintiff. The assessment was got done by the Insurance Company and it was found that the defendant No.4 had suffered a loss of Rs.55,633.86/-and the loss of damage to the containers was assessed at Rs.4,120/-and accordingly, total loss of Rs.55,633.86/-was assessed by the Insurance Company. Fee of Rs.1,106/was paid by the Insurance Company to the surveyor. Thereafter, the plaintiff/respondent No.1 after revising the total loss, paid Rs.45,955/- to defendant No.4 on 13/06/1988 and fee of Rs.1,106/-was paid to the surveyor. Fee of Rs.1,106/was paid by the Insurance Company to the surveyor. Thereafter, the plaintiff/respondent No.1 after revising the total loss, paid Rs.45,955/- to defendant No.4 on 13/06/1988 and fee of Rs.1,106/-was paid to the surveyor. As the letter of subrogation was given by defendant No.4, the defendant No.4 was entitled to recover this amount from the defendant Nos.1 to 3 and accordingly, the plaintiff/respondent No.1 is entitled to recover the same from the defendants No.1 to 3. A demand notice was issued for payment of amount of Rs.55,633.86/-which was served on the defendants No.1 to 3. However, the amount has not been paid. The defendant No.4 was made a formal defendant because in the case if any contrary stand is taken by the defendant no.4, then the amount of compensation paid by the Insurance Company, can be recovered from the defendant No.4 also. It was further pleaded that the plaintiff/respondent No.1 is entitled for recovery of Rs.45,955/-[loss paid to the defendant No.4] and fee of Rs.1,106/-paid to the surveyor and thus, the suit was filed for recovery of Rs.54,111.46/-. 3. The defendants No.1 and 2 filed their written statements and denied that the Senior Divisional Manager is competent to file the suit. It was admitted that the defendant No.1 is the owner of the truck bearing registration No. MNA 415 and is in the business of transportation. It was further pleaded that if for any reason the consignment does not reach to its destination, then the entire liability is of the Transport Agency and if the goods are insured, then the liability to pay compensation is of the Insurance Company and not of the owner of the truck because the agreement of the insurance is between the owner of the goods and the Insurance Company of the Transporter. There is no privity of contract between the owner of goods and owner of the truck. It was further pleaded that the defendants No.1 to 2 are the owners and the driver of the truck, and are not liable to pay the damages. 4. So far as the fact of accident is concerned, it was not disputed. However, it was the contention of the defendants No.1 and 2 that in absence of privity of contract, they are not liable to pay the damages to the Insurance Company. 4. So far as the fact of accident is concerned, it was not disputed. However, it was the contention of the defendants No.1 and 2 that in absence of privity of contract, they are not liable to pay the damages to the Insurance Company. It was further denied that the accident took place because of rash and negligent driving of the defendant No.2. It was further pleaded that in fact, the suit is a collusive suit, which has been filed by Insurance Company in connivance with the defendant No.4, so that the amount can be recovered from the defendants No.1 to 3. The survey report mentioned in paragraph 7 of the plaint was not admitted. The defendants were never called nor any survey was conducted in the presence of the defendants No.1 and 2. The defendants No.1 and 2 are also not aware of the market price of the goods. Accordingly, the defendants No.1 and 2 denied their liability to pay the amount as claimed by the Insurance Company. It was further pleaded that the owner of the goods comes under the category of third party. The truck involved in the accident was insured with the New India Assurance Company Limited and comprehensive Insurance Policy was there and accordingly, the insurer of the defendant No.1 is also a necessary party. It was further pleaded that in case, if the defendants No.1 and 2 are found liable to pay the compensation amount, then the award may also be passed against the New India Assurance Company Limited, because the truck in question was insured by the said Company by issuing the comprehensive policy. 5. The defendant no.3 filed its separate written statement and stated that the defendant No.3 is not liable to pay the amount to the Insurance Company. The goods were booked as per the conditions mentioned on the overleaf of bilti. The defendant no.3 is not under obligation to pay any damages to the defendant No.4. 6. In view of the objection raised by the defendants No.1 and 2, it appears that the New India Assurance Company Limited was also impleaded as defendant no.5 which also filed its separate written statement and denied that the defendant no.1 is the registered owner of the truck bearing registration no. MNA415. No cause of action has arisen against the defendant no.5 and no pleadings have been made against the defendant No.5. MNA415. No cause of action has arisen against the defendant no.5 and no pleadings have been made against the defendant No.5. The defendant No.5 is not aware of any policy. The defendant No.5 has nothing to do with Marine Insurance issued by plaintiff in favour of the defendant No.4. It was further pleaded that in fact, no cause of action has arisen against the defendant No.5 and further, the defendant No.5 has been impleaded as defendant in the suit after nine years of the cause of action, therefore, it is barred by limitation. 7. The defendant no.4 did not file its written statement. 8. The trial Court after framing the issues and recording the evidence of the parties decreed the suit by judgment and decree dated 1st May, 2002 against the defendants No. 1 to 3 i.e. appellant and respondents No.2 and 3. 9. Challenging the judgment and decree passed by the Court below, it is submitted by the counsel for the appellants that notice as required under Section 10 of the Carriers Act was not given by the appellants. It is further submitted that there is no privity of contract between the appellants and respondent No.1. 10. Per contra, it is submitted by the counsel for the respondent No.1 that the respondent No.4/defendant No.4 had issued notice demanding compensation. The said notice was issued well within its time. The letter of subrogation was issued by the respondent No.4 in favour of the respondent No.1 and, therefore, the respondent No.1 by virtue of letter of subrogation had stepped into the shoes of the defendant No.4/respondent No.4. 11. So far as the question of privity of contract is concerned, it is submitted that the respondent No.1 had filed a suit after stepping into the shoes of the respondent No.4 and the respondent No.1 had not claimed anything against the appellant and the respondents No.2 and 3 on the basis of any independent right but the respondent No.1 has filed the suit by virtue of letter of subrogation. 12. Heard the learned counsel for the parties. ''Subrogation'' means the substitution of one person or group by another in respect of a debt or insurance claim, accompanied by the transfer of any associated rights and duties. The defendant No.1/respondent No.4 had executed a letter of subrogation Ex.P19, which reads as under. Letter of Subrogation The Oriental Insurance Co., Ltd. Gwalior. Heard the learned counsel for the parties. ''Subrogation'' means the substitution of one person or group by another in respect of a debt or insurance claim, accompanied by the transfer of any associated rights and duties. The defendant No.1/respondent No.4 had executed a letter of subrogation Ex.P19, which reads as under. Letter of Subrogation The Oriental Insurance Co., Ltd. Gwalior. In consideration of your paying to us the sum of Rs.45955-00 only say Rupees Forty Five thousand Nine hundred fifty five only in fill and final settlement of our claim for shortages and damages under Policy/Certificate number 22422/28/87/00005, DC No.95 issued by you on the under mentioned goods, we hereby assign transfer and abandon to you all our rights against the Transport Company/Railway Company/Administration or other persons whatsoever, caused or arising by reason of the same damage or loss and grant you full power to take and use all lawful ways and means in your own name and otherwise at your risk and expenses to recover the said damage or loss and we hereby subrogate to you the same rights as we have to in consequence of our arising from the said loss or damage. And we hereby undertake and agree to make and execute at your expenses all such further deeds, assignments and documents and to render you such assistance as you may reasonably required for the purpose of carrying out this agreement. Interest Bill No. G. R./R.R. No. From To Amount 640 Tins Tansen Brand Mustard Oil 181 397 dt. 18.3.88 Morena Jharia 197771.00 13. The defendant No. 1/respondent No.4 had executed a power of attorney Ex.P18 which reads as under:- ''SPECIAL POWER OF ATTORNEY To all to whom these presents shall come, We Messrs Goyal Industries a firm carrying on business at Morena and greetings: Whereas, we the consignee, the respect of the goods booked under Invoice No.101 G.R.No.397 dated 18.3.88 from Morena hereby appoint nominate, constitute The Oriental Insurance Company Ltd., carrying on Insurance business, to act by any of their representative as our True and lawful attorneys to do all or any of the following acts, deeds and things for us and on our behalf in our name that is to any : 1. To receive claim moneys from the Transport company/Railway Administration or authorities payable to us under the aforesaid invoice G. R./R.R. 2. To receive claim moneys from the Transport company/Railway Administration or authorities payable to us under the aforesaid invoice G. R./R.R. 2. The give valid discharges on your behalf pertaining to the above claim. 3. To sign all receipts in our name and on our behalf pertaining to the above claim. 4. To present any applications before any authority or persons concerned for claim in respect of aforesaid invoice G. R./R.R. 5. To settle and adjust the above claim, if necessary, and to give valid discharges and effectual receipts. 6. To file suit in court of law against the Transport Company/Railway administration if necessary for the recovery of claim moneys for the aforesaid claim on our behalf and in our name and give valid discharges and effectual receipts thereto. We, the said firm, Messrs Goyal Industries Morena do hereby ratify and confirm and agree to ratify and confirm all the acts and things which our said attorneys shall lawfully do or cause to be done pursuant to these presents. In witness where I Vipin Goyal duly authorized partner of the firm of Messrs Goyal Industries for and on behalf of the Firm have set my hand and seal at Morena this 8th June 1988. Signed sealed and delivered by the with in named firm of Messrs. Through the For Goyal Industries hands of Vipin Chandra Goyal Partner M/s. Goyal Industries, MORENA '' 14. On the plain reading of Ex.P19, it is clear that after the damages were paid by the respondent No.1 to the defendant No.4, the letter of subrogation was issued. 15. The Supreme Court in the case of Prakash Road-lines Private Limited vs. Oriental Fire and General Insurance Co. ltd. Reported in 2000(10) SCC 64 has held as under:- ''3. It is as settled law that a document has to be interpreted not by its nomenclature but what is contained in the said document. A reading of the document shows that it was a deed of assignment in favour of the Insurance Company. We are, therefore, in agreement with the view taken by the High Court. Consequently, we do not find any merit in the appeal. It is accordingly dismissed. There shall be no order as to costs.'' 16. The Punjab and Haryana High Court in the case of Aitco Movers Pvt. Ltd. vs. United India Insurance Co. We are, therefore, in agreement with the view taken by the High Court. Consequently, we do not find any merit in the appeal. It is accordingly dismissed. There shall be no order as to costs.'' 16. The Punjab and Haryana High Court in the case of Aitco Movers Pvt. Ltd. vs. United India Insurance Co. Ltd. And Others, reported in 2007 ACJ 1620 has held as under:- ''18. In view of the discussion held above, it is held that since the respondent-Insurance Company was the assignee of the rights of the owners, therefore, it was entitled to file the suit for recovery in its own name and the judgment relied upon by the learned counsel for the appellant is not applicable to the facts of the present case.'' 17. In the present case, the the transporter/Defendant No.3 had accepted the loss to the tune of Rs.60,000/-by issuing damage certificate dated 28-03-1988 Ex.P8. It is not necessary to prove that the accident had occurred because of negligence of the transporter/driver/owner of the truck. The mere fact that the accident had taken place which resulted in loss to the goods is sufficient to hold that the Insurance Company is liable to recover the damages from the Transporter/owner/driver of the truck on the strength of letter of subrogation/assignment. The factum of accident of the truck was not denied. The extent of loss to the goods was also admitted by the transporter by issuing loss certificate Ex.P8 and the fact that the respondent no.1/plaintiff is held liable to indemnify the consignor is also not in dispute and the letter of subrogation Ex.P19 is also not disputed by the respondent No.4. So far as the judgment passed by the Supreme Court in the Oberai Forwarding Agency vs. New India Assurance Co. Ltd. And another reported in (2000) 2 SCC 407 is concerned, it was in the context that whether the Insurance Company can be said to be a consumer for approaching the Consumer Forum or not. In the present case, the civil suit has been filed and on the basis of letter of subrogation, the Insurance Company is entitled to recover the amount from the owner/transporter/driver of the truck. Accordingly, this Court is of the considered opinion that no illegality could be pointed by the counsel for the appellants. In the present case, the civil suit has been filed and on the basis of letter of subrogation, the Insurance Company is entitled to recover the amount from the owner/transporter/driver of the truck. Accordingly, this Court is of the considered opinion that no illegality could be pointed by the counsel for the appellants. Hence, the Court below did not commit any mistake in passing the decree against the appellants as well as the respondents No.2 and 3. 18. No order argument is advanced by the counsel for the appellant. 19. Resultantly, the judgment and decree dated 1st May, 2002 passed by Third Additional District Judge, Morena in Civil Suit No.68-A of 2000 is hereby affirmed. 20. The appeal fails and is hereby dismissed.