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2020 DIGILAW 596 (GAU)

New India Assurance Co. Ltd. v. P. C. Lalfakawmi

2020-06-25

MICHAEL ZOTHANKHUMA

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JUDGMENT : MICHAEL ZOTHANKHUMA, J. 1. Heard Mr. Lalfakawma, the learned counsel for the appellant, as well as Mr. Johny L. Tochhawng, the learned counsel for the respondents-claimant Nos. 1 to 4. 2. This is an appeal filed by the insurance company against the judgment and award dated 14.12.2018, passed by the Motor Accidents Claims Tribunal, Aizawl in MACT Case No. 61 of 2017, whereby the compensation amount of Rs. 5,00,000 and interest at the rate of 7 per cent per annum has been awarded to the claimants, due to the death of Aminadala Akima in a motor cycle accident. 3. The facts of the case are that the husband of the claimant No. 1 and father of the claimant Nos. 2 to 4 died in a motorbike accident on 14.1.2017 at Bilkhawthlir when the motor cycle bearing No. MZ-01-H 1707, which was owned by C. Lalrinmawia of Durtlang Leitan, fell off a cliff. The deceased had borrowed the motor cycle from the owner. The claimants thereafter filed a claim petition under section 163-A of the Motor Vehicles Act, 1988 (for short ‘the MV Act’). The owner of the vehicle contested the case by filing a written statement stating that he had sold the bike in the year 2015 to one Zarzokima of Bilkhawthlir and accordingly, he had no liability. 4. The present appellant (insurance company) also filed its written statement praying that the claim should be dismissed as it had no liability in the said case. 5. The learned trial court framed the following issues: “(i) Whether the present claim application is maintainable in its present form and style? (ii) Whether the claimants are entitled to compensation, and if so, to what extent and who is liable to pay?” 6. The claimants were examined by the learned MACT and thereafter, the impugned judgment and award dated 14.12.2018 was passed, whereby the learned Tribunal awarded compensation of Rs. 5,00,000, payable by the appellant along with interest at the rate of 7 per cent per annum from the date of filing the claim petition, i.e. 11.10.2017 till final payment. The compensation amount of Rs. 5,00,000 had been awarded in terms of notification dated 22.5.2018, issued by the Ministry of Road Transport and Highways, vide Memo No. S.O. 2022 (E), which states that the compensation amount payable in case of death under section 163-A of the MV Act, 1988 shall be Rs. The compensation amount of Rs. 5,00,000 had been awarded in terms of notification dated 22.5.2018, issued by the Ministry of Road Transport and Highways, vide Memo No. S.O. 2022 (E), which states that the compensation amount payable in case of death under section 163-A of the MV Act, 1988 shall be Rs. 5,00,000. 7. Being aggrieved by the impugned judgment and award, the appellant insurance company has filed the present appeal. 8. The learned counsel for the appellant submits that the impugned judgment and award should be set aside as the learned Tribunal failed to fully appreciate the evidence and the fact that the motor cycle owner was not the employer of the deceased and that the owner of the motor cycle was a third party. 9. The second ground of challenge made by the appellant to the impugned judgment and award was that the learned Tribunal had awarded compensation on the basis of the notification dated 22.5.2018, issued by the Ministry of Road Transport and Highways, vide Memo No. S.O. 2022 (E), whereas the deceased had met with an accident on 14.1.2017, i.e. prior to the publication of the notification dated 22.5.2018. He accordingly submits that compensation could not have been awarded on the basis of the notification dated 22.5.2018 and the same could have been done on the basis of the Second Schedule of the MV Act, 1988. 10. The learned counsel for the respondent Nos. 1 to 4, on the other hand, submits that there is no infirmity with the impugned judgment and award passed by the learned Tribunal, inasmuch as, it is an admitted fact that the deceased had borrowed the motor cycle from the owner and died due to his injuries when he ran over the cliff. He submits that as per section 163-A of the MV Act, 1988, there is no requirement of any negligence being proved and that in terms of the notification dated 22.5.2018, the compensation awarded to the claimant was just compensation. 11. I have heard the learned counsel for the parties. 12. He submits that as per section 163-A of the MV Act, 1988, there is no requirement of any negligence being proved and that in terms of the notification dated 22.5.2018, the compensation awarded to the claimant was just compensation. 11. I have heard the learned counsel for the parties. 12. On perusing the grounds of appeal made by the appellant, this court finds that the appellant has not raised the specific issue of whether the deceased had stepped into the shoes of owner of the motorbike and whether a person who steps into the shoes of the owner of accident vehicle could make a claim under section 163-A of the Motor Vehicles Act, 1988. The learned Tribunal has however framed general issues which would include within its fold the above specific issue. 13. In the present case, it is admitted by the counsel for the respondent Nos. 1 to 4-claimants that the deceased had used the motor cycle with the permission of the motor cycle owner. The Supreme Court in the case of Ningamma vs. United India Insurance Co. Ltd. 2009 ACJ 2020 (SC), has held at Para-18 that deceased who borrowed a motorbike from its real owner cannot be held to be employee of the owner of motorbike, although he was authorised to drive the vehicle by its owner and, therefore, he would step into the shoes of the owner of the motorbike. 14. The Apex Court in Paras 18, 19 and 24 of Ningamma vs. United India Insurance Co. Ltd. 2009 ACJ 2020 (SC), has stated as follows: “(18)...It was held in the said decision [Oriental Insurance Co. Ltd. 2008 ACJ 1441 (SC)] that section 163-A of the MVA cannot be said to have any application in respect of an accident wherein the owner of the motor vehicle himself is involved. The decision further held that the question is no longer res Integra. The liability under section 163-A of the MVA is on the owner of the vehicle. So a person cannot be both, a claimant as also a recipient, with respect to claim. Therefore, the heirs of the deceased could not have maintained a claim in terms of section 163-A of the MVA. In our considered opinion, the ratio of the decision in Oriental Insurance Co. Ltd. case is clearly applicable to the facts of the present case. Therefore, the heirs of the deceased could not have maintained a claim in terms of section 163-A of the MVA. In our considered opinion, the ratio of the decision in Oriental Insurance Co. Ltd. case is clearly applicable to the facts of the present case. In the present case, the deceased was not the owner of the motorbike in question. He borrowed the said motorbike from its real owner. The deceased cannot be held to be an employee of the owner of the motorbike although he was authorised to drive the said vehicle by its owner and, therefore, he would step into the shoes of the owner of the motorbike. (19) We have already extracted section 163-A of the MVA hereinbefore. A bare perusal of the said provision would make it explicitly clear that persons like the deceased in the present case would step into the shoes of the owner of the vehicle... (24) There are indeed cases like New India Assurance Co. Ltd. vs. Sadanand Mukhi, 2009 ACJ 998 (SC), wherein the son of the owner, who was driving the vehicle and died in the accident, was not regarded as third party. In the said case, the court held that neither section 163-A nor section 166 would be applicable.” A perusal of the above clearly shows that if the deceased rider had borrowed the motor cycle from its real owner, the deceased would step into the shoes of the owner of the motorbike and no claim could be made by the claimant under section 163-A of the MV Act, 1988, as the deceased could not be said to be a third party. 15. To a query raised by this court to the counsel for the respondent Nos. 1 to 4 (claimants), as to whether the case of Ningamma, 2009 ACJ 2020 (SC), would be applicable to the facts of this case, the counsel for the respondent Nos. 1 to 4 submits that as the insurance company has not brought out the relationship between the owner of the motor cycle and the deceased, the insurance company could not be discharged from the onus of establishing that the deceased represented the owner of the motor cycle and as such was not a third party. 1 to 4 submits that as the insurance company has not brought out the relationship between the owner of the motor cycle and the deceased, the insurance company could not be discharged from the onus of establishing that the deceased represented the owner of the motor cycle and as such was not a third party. He thus submits that the decision of the Apex Court in Ningamma (supra) would not be applicable to the facts of this case and in support of the same, he has relied upon the judgment of the Apex Court in the case of National Insurance Co. Ltd. vs. Sinitha, 2012 ACJ 1 (SC). 16. In the case of National Insurance Co. Ltd. vs. Sinitha, 2012 ACJ 1 (SC), the question to be decided was whether a claim for compensation made under section 163-A of the MV Act, 1988, could be defeated, either by the owner or the insurance company, by pleading and establishing that the accident in question was based on the contributory negligence of the offending vehicle. In the above case, one Shijo, who was riding a motor cycle along with a pillion rider, hit a stone lying on the road. The rider Shijo succumbed to his injury while the pillion rider survived. The claimants, i.e. the wife, children and parents of the deceased Shijo filed a claim petition before the MACT under section 166 (sic which was later converted to one under section 163-A) of the MV Act, 1988. The Apex Court by reading down the provision of sections 140 and 163-A of the MV Act, 1988 held that the claim for compensation under section 140 of the MV Act cannot be defeated because of any ‘fault’ grounds (wrongful act or neglect or default). However, it is open to the owner of the accident vehicle or the insurance company, as the case may be, to defeat the claim under section 163-A of the Act by pleading and establishing through cogent evidence or ‘fault’ grounds (wrongful act or neglect or default). The Apex Court in the above case thus held that while section 140 of the MV Act, 1988 was founded under the ‘no fault liability’ principle, section 163-A of the Act was founded under the ‘fault liability’ principle. 17. The contention of the insurance company in the case of National Insurance Co. The Apex Court in the above case thus held that while section 140 of the MV Act, 1988 was founded under the ‘no fault liability’ principle, section 163-A of the Act was founded under the ‘fault liability’ principle. 17. The contention of the insurance company in the case of National Insurance Co. Ltd. vs. Sinitha, 2012 ACJ 1 (SC), was that the deceased being the rider of the motor cycle and as he was not the employee of the owner of the motor cycle, he stepped into the shoes of the owner. As such, no claim could be made under section 163-A of the MV Act. The Apex Court in the above case held that it was essential for the insurance company to establish the relationship between the deceased and the owner of the motor cycle, to prove that the deceased had stepped into the shoes of the owner of the motor cycle. As the same was apparently not done, the Apex Court held that it could not be said that the deceased was not a third party. 18. In the case of National Insurance Co. Ltd. vs. Sinitha, 2012 ACJ 1 (SC), the Apex Court did not consider the judgment of the Apex Court in Ningamma, 2009 ACJ 2020 (SC). The main issue in National Insurance Co. Ltd. vs. Sinitha (supra) was whether section 163-A of the MV Act, 1988 was founded under the ‘no fault’ liability principle or ‘fault’ liability principle. As stated earlier, the Apex Court in the above case held that it was founded on ‘fault liability’ principle. With regard to the issue whether the deceased had stepped into the shoes of the owner of the motorbike, the Apex Court held that the insurance company did not discharge its onus to prove the relationship between the deceased and the owner of the motorbike, so as to enable the Apex Court to come to a finding that deceased was an agent, employee or representative of the owner of the motorbike. The Apex Court in the above case of National Insurance Co. Ltd. vs. Sinitha (supra) made the said observation in terms of the judgment of the Apex Court in the case of Oriental Insurance Co. Ltd. vs. Jhuma Saha, 2007 ACJ 818 (SC). 19. In the case of Oriental Insurance Co. The Apex Court in the above case of National Insurance Co. Ltd. vs. Sinitha (supra) made the said observation in terms of the judgment of the Apex Court in the case of Oriental Insurance Co. Ltd. vs. Jhuma Saha, 2007 ACJ 818 (SC). 19. In the case of Oriental Insurance Co. Ltd. vs. Jhuma Saha, 2007 ACJ 818 (SC), the issue was whether a claim for death of the deceased, who was the owner of the motor vehicle and himself being negligent could have been made under section 166 of the MV Act, 1988. The Apex Court in the above case held that liability of the insurance company is to the extent of indemnification of the insured. If the insured could not be fastened with any liability under the provisions of the MV Act, 1988, the question of the insurer being liable to indemnify the insured does not arise. Paras 10, 11 and 12 of the above judgment are reproduced below: “(10) The deceased was the owner of the vehicle. For the reasons stated in the claim petition or otherwise, he himself was to be blamed for the accident. The accident did not involve motor vehicle other than the one which he was driving. The question which arises for consideration is that the deceased himself being negligent, the claim petition under section 166 of the Motor Vehicles Act, 1988 would be maintainable. (11) Liability of the insurance company is to the extent of indemnification of the insured against the respondent or an injured person, a third person or in respect of damages of property. Thus, if the insured cannot be fastened with any liability under the provisions of the Motor Vehicles Act, the question of the insurer being liable to indemnify the insured, therefore, does not arise. (12) In Dhanraj vs. New India Assurance Co. Ltd. 2005 ACJ 1 (SC), it is stated as follows: “(8) Thus, an insurance policy covers the liability incurred by the insured in respect of death of or bodily injury to any person (including an owner of the goods or his authorised representative) carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle. Section 147 does not require an insurance company to assume risk for death or bodily injury to the owner of the vehicle. Section 147 does not require an insurance company to assume risk for death or bodily injury to the owner of the vehicle. (10) In this case, it has not been shown that the policy covered any risk for injury to the owner himself. We are unable to accept the contention that the premium of Rs. 4,989 paid under the heading ‘own damage’ is for covering liability towards personal injury. Under the heading ‘own damage’, the words ‘premium on vehicle and non-electrical accessories’ appear. It is thus clear that this premium is towards damage to the vehicle and not for injury to the person of the owner. An owner of a vehicle can only claim provided a personal accident insurance has been taken out. In this case there is no such insurance.” 20. As stated earlier, the Supreme Court in the case of National Insurance Co. Ltd. vs. Sinitha, 2012 ACJ 1 (SC), did not consider the case of Ningamma (supra). In the case of Siddharam Satlingappa Mhetre vs. State of Maharashtra, (2011) 1 SCC 694 , the Apex Court has held that not only the judgment of a larger strength is binding on a Bench of Judges of smaller strength, but the judgment of a coequal Bench strength is also binding on a Bench of Judges of coequal strength. In the present case, it is admitted by the counsel for the appellant that the deceased had borrowed the bike from the owner. It is also an admitted fact that the deceased was not an employee of the owner of the bike. As the judgment of the Apex Court in Ningamma (supra) squarely covers this case and as the said case has not been considered in the case of National Insurance Co. Ltd. vs. Sinitha (supra), the judgment of the Apex Court in Ningamma (supra) will have to be followed. Also, the judgment of the Apex Court in National Insurance Co. Ltd. vs. Sinitha (supra) is on a different set of facts. It is settled law that a decision is an authority for what it decides and not logically follows from it. A little difference in facts can change the precedential value of a decision. Further, the decision of the Apex Court in the case of National Insurance Co. Ltd. vs. Sinitha (supra) has been referred to a larger Bench in the case of United India Insurance Co. A little difference in facts can change the precedential value of a decision. Further, the decision of the Apex Court in the case of National Insurance Co. Ltd. vs. Sinitha (supra) has been referred to a larger Bench in the case of United India Insurance Co. Ltd. vs. Sunil Kumar, 2013 ACJ 2856 (SC), with regard to the finding that section 163-A of the MV Act is founded under the ‘fault’ liability principle. 21. In the case of Oriental Insurance Co. Ltd. vs. Sunita Rathi, 1998 ACJ 121 (SC), the Apex Court has held that the liability of the insurer arises only when the liability of the insured has been found. Thus, if the deceased steps into the shoes of the owner of the motorbike, the liability of the insurer would arise only when the liability of the insured has been found. As the owner of an accident vehicle cannot make a claim under section 163-A of the MV Act, 1988, as a claim under section 163-A can be made only against the owner of the vehicle, the claimants could not have made the claim due to the death of the deceased, as the deceased had stepped into the shoes of the owner of the vehicle. Also, the deceased who stepped into the shoes of the owner of the accident vehicle cannot be said to be a third party in respect of the insurance policy covering the said motor cycle. 22. In the present case, the claimants would be entitled to claim compensation for the death of the deceased from the insurance company if the insurance policy covers any risk for death or injury to the owner himself. In the case of Oriental Insurance Co. Ltd. vs. Rajni Devi, 2008 ACJ 1441 (SC), the Apex Court has held at Para 6 as follows: “(6) It is now a well settled principle of law that in a case where third party is involved, the liability of the insurance company would be unlimited. Where, however, compensation is claimed for the death of the owner or another passenger of the vehicle, the contract of insurance being governed by the contract qua contract, the claim of the insurance company would depend upon the terms thereof. Where, however, compensation is claimed for the death of the owner or another passenger of the vehicle, the contract of insurance being governed by the contract qua contract, the claim of the insurance company would depend upon the terms thereof. The Tribunal, in our opinion, therefore, was not correct in taking the view that while determining the amount of compensation, the only factor which would be relevant would be merely the use of the motor vehicle.” 23. In view of the reasons stated above, this court finds that no compensation could have been awarded to the respondent Nos. 1 to 4-claimants under section 163-A of the MV Act, 1988. Accordingly, the impugned judgment and award dated 14.12.2018, passed by the Motor Accidents Claims Tribunal, Aizawl in MACT Case No. 6 of 2017 is set aside. However, the respondent Nos. 1 to 4 can make a claim for compensation from the insurance company, depending upon whether the owner of the vehicle is covered by the contract of insurance for injury or death in the insurance policy. 24. Appeal is accordingly disposed of. 25. Send back the LCR. 26. The appellant insurance company is also allowed to withdraw the statutory deposit that it had made before the Registry of this court for filing the present appeal.