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2024 DIGILAW 173 (KAR)

M. R Basavanthappa v. Mallamma

2024-02-23

C.M.POONACHA

body2024
JUDGMENT : C.M. Poonacha, J. The present appeal is filed by the owner challenging the judgment and award dated 21.08.2012 passed in MVC.No.921/2010 by the II Additional Senior Civil Judge and VI Additional MACT, Davanagere.1 Hereinafter referred as 'Tribunal' 2. For the sake of convenience, the parties herein are referred as per their rank before the Tribunal. 3. The Tribunal by this judgment and award dated 21.08.2012 has allowed the claim petition filed by the claimant and awarded compensation of a sum of Rs. 4,19,000/- together with interest at 6% per annum. However, the liability to pay the compensation has been fastened on the owner of the vehicle, who was Respondent No.2 before the Tribunal. Being aggrieved, the present appeal is filed by the owner. 4. The sole contention urged by the learned counsel for the appellant/owner is that the Tribunal has fastened the liability on the owner to pay the compensation, due to the fact that the vehicle was plying at the place, where he did not have permit to operate and hence it was held that there was violation of the permit condition and the Insurer was exonerated from the liability of payment of the compensation awarded. He further submits that the said finding is erroneous and that even though there is a violation of the permit condition, the compensation is required to be fastened on the Insurer. In support of his contention he relies on a decision of the Division Bench judgments of this Court in the case of Rehana Begum v. New India Assurance Company Limited., judgment dated 27.07.2021 passed in MFA No.5960/2015 C/W 706/2013 And United India Insurance Company Limited v. Sandhya, judgment dated 7.06.2019 passed in MFA No.102428/2017(MV) . 5. Per contra, learned counsel for the respondent/Insurer submits that the finding of the Tribunal fastening the liability on the owner is just and proper. In support of his contention he relies on a Division Bench judgment of this Court in the case of Syedzaheer @ Sayyed Jahiruddin Bokhari v. Puttamadamma, dated 07.12.2023 passed in MFA No.5745/2016 C/W MFA No. 4811/2016. 6. The submissions made by both the learned counsels have been considered and the material on record have been perused including the records of the Tribunal. The question that arises for consideration is 'whether the finding of the Tribunal exonerating the Insurer from the liability to pay the compensation is just and proper? 7. 6. The submissions made by both the learned counsels have been considered and the material on record have been perused including the records of the Tribunal. The question that arises for consideration is 'whether the finding of the Tribunal exonerating the Insurer from the liability to pay the compensation is just and proper? 7. It is forthcoming from the material on record that the accident occurred when the Insured bus was plying from Davanagere to Kukkuvada Road. The evidence of RW.2 and RW.3 discloses that the owner did not have the permit to ply on the said road. 8. Having regard to the material on record it is clear that the insured bus had a permit. However, it was plying on the route where it was not permitted to be used. A similar question arose before the co-ordinate Bench of this Court in the case of Durugamma v. S.G.Naresh And Others, 2017 (1) AKR 67 wherein after referring to various judgments as also after referring to Section 207 of the Motor Vehicles Act and this Court held that the liability to pay the compensation is on the Insurer. 9. A Division Bench of this Court in the case of Rehana Begum has after noticing various judgments, held that plying of the vehicles outside the permitted zone does not amount to fundamental statutory infraction and that the Insurer cannot be absolved of its liability to pay the compensation. 10. Further a Division Bench of this Court in the case of United India Insurance Company Limited has noticed the co-ordinate judgment of this Court in the case of Durugamma and as well as other judgments has held as follows: 17. It is held in Durugamma's case stated supra that, "there are different kinds of contravention of the permit, one of which is relating to the route on which or the area in which the vehicle may be used. The purpose for which the vehicle may be used is distinguishable from the terms and conditions of the permit. At last, the route on which or the area in which the vehicle may be used, is one of the terms and conditions of the permit. But the same cannot be construed as the purpose for which the vehicle was to be used. At last, the route on which or the area in which the vehicle may be used, is one of the terms and conditions of the permit. But the same cannot be construed as the purpose for which the vehicle was to be used. Making the distinction, the learned Single Judge of this Court rightly came to the conclusion that the terms and conditions attached to each type of permit cannot be construed as a purpose of the permit. The purpose and the terms and conditions are two different aspects." Therefore, the learned Single Judge interpreted that the legislature in its wisdom has restricted the defence that are available to the insurer under Section 149(2)(a)(i)(c) of the Act for a purpose and it is not allowed by the permit and not for violation of any terms and conditions of the permit. For example, if a vehicle has a good carriage permit but has carried passengers or vice versa, then it can be held that the offending vehicle goods carriage permit is being used for a purpose not allowed by the permit. 18. Therefore, the sole distinction on which the authorities relied on by the learned counsel for the appellant can be distinguished is on the ground that whether there was any violation of the purpose for which the vehicle was to be used and whether the violation of exceeding the territorial jurisdiction granted on the ground to ply the vehicle would amount to violation of purpose for which the vehicle was to be used. If that distinction is understood and kept in mind, we find that whether the Insurance Company can absolve its liability on the ground that the vehicle in question has plied beyond the territorial limits granted under the permit and therefore there is no permit for the vehicle can be decided. Further, the Insurance Company cannot contend that its liability is absolves on the ground that the purpose for which the vehicle was to be used, is violated. Because in this case the sole ground taken is violation of permit condition. 19. In this case admittedly the vehicle had a valid permit to transport goods. It had valid permit to ply. The violation complained is that of route permit, i.e., being territorial limits. The same cannot be a defence for the Insurance Company within the purview of Section 149(2) of M.V. Act. 19. In this case admittedly the vehicle had a valid permit to transport goods. It had valid permit to ply. The violation complained is that of route permit, i.e., being territorial limits. The same cannot be a defence for the Insurance Company within the purview of Section 149(2) of M.V. Act. We approve the decision rendered by the learned Single Judge of this Court in Durugamma's case stated supra. The fact that the deceased was a labourer under the respondent No.1 owner is not disproved by the material placed on record. Therefore, on the above said ground that the Insurance Company cannot avoid its liability to satisfy the award. Accordingly, point No.1 is answered in the negative. (emphasis supplied) 11. Another Division Bench judgment of this Court in the case of Syed Zaheer @ Sayyed Jahiruddin Bokhari has also noticed wherein other judgments as well as various provisions of the Act and recorded the finding that the Insurer can avoid its liability. However it is relevant to note that although various judgments have been noticed, Section 207 of the Act which enables detention of vehicles used without permit has not been noticed. 12. In the case of Durugamma this Court has held as follows: 16. Section 207 empowers any police officer or other authorized person to seize and detain the vehicle for the contraventions of sections 3 or section 4 or section 39 or without the permit required by sub-section [1] of section 66 or in contravention or any condition of such permit relating to the route on which or the area in which or the purpose for which the vehicle may be used. 17. It is beneficial to refer to this provision only to ascertain the intention of the legislature in employing the words 'the purpose for which the vehicle may be used'. There are different kinds of contravention of the permit. One of it is relating to the route on which or the area in which the vehicle may be used. The purpose for which the vehicle may be used is distinguishable from the terms and conditions of the permit. Utmost, route on which or the area in which the vehicle may be used is one of the terms and conditions of the permit. But, it cannot be construed as the purpose for which the vehicle may be used. The purpose for which the vehicle may be used is distinguishable from the terms and conditions of the permit. Utmost, route on which or the area in which the vehicle may be used is one of the terms and conditions of the permit. But, it cannot be construed as the purpose for which the vehicle may be used. The Hon'ble Apex Court while considering this aspect relating to section 207 of the Act, in the case of 'State Of Maharashtra And Others v. Nanded-Parbhani Z.L.B.M.V. Operator Sangh' reported in 2000 [2] SCC 69 has observed thus: "According to the learned counsel appearing for the State of Maharashtra the expression "purpose for which the vehicle may be used" could be construed to mean that when the vehicle is found to be carrying passengers more than the number prescribed in the permit, the purpose of user is otherwise. We are unable to accede to this contention as in our opinion, the purpose would only refer to a contingency when a vehicle having a permit of a stage carriage is used as a contract carriage or vice versa or where a vehicle having a permit for stage carriage or contract carriage is used as a goods vehicle and vice versa." 18. Though this decision is rendered in the context of Section 207 of the Act, the same would throw light to interpret the words 'for a purpose not allowed by the permit' under Section 149[2][a][i][c] of the Act. 'Purpose' would be construed as stage carriage, contract carriage, goods carriage, private vehicle, temporary permit and so on. The terms and conditions attached to each type of permit cannot be construed as the purpose for the permit. 'Purpose' and 'the terms of conditions' are two different aspects. The legislature in its wisdom thought it fit to restrict the defence available under Section 149[2][a][i][c] of the Act 'for a purpose not allowed by the permit' and not for 'violation of any terms and conditions of the permit'. For example, if a vehicle holding goods carriage permit is carrying passengers or vice versa. Then, it can be held that the vehicle holding goods carriage permit is being used for a purpose not allowed by the permit. The breach of conditions of the permit would by itself can not be characterised as the purpose not allowed in the permit. For example, if a vehicle holding goods carriage permit is carrying passengers or vice versa. Then, it can be held that the vehicle holding goods carriage permit is being used for a purpose not allowed by the permit. The breach of conditions of the permit would by itself can not be characterised as the purpose not allowed in the permit. In Challa Bharathamma's case [supra], the Hon'ble Apex Court has held thus: "12. 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 at a better pedestal vis-a-vis 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 insurer. High Court was, therefore, not justified in holding the insurer liable. " The said judgment is rendered in the context of 'no permit'. The motor vehicle not possessing a permit means the vehicle was not permitted to ply in the public place or in other words, there is infraction of law which clearly establishes the use of the vehicle for a purpose not allowed in law. Hence, the said Judgment of Challa Bharathamma's case [supra] is not applicable to the facts of the present case. 19. In Challa Bharathamma's case [supra], their Lordships have referred to the Judgment of the Hon'ble Apex Court in the case of 'New India Assurance Co., Ltd., v. Asha Rani And Others' reported in [2003 [2] SCC 223] wherein it was observed as follows: "We may consider the matter from another angle. Section 149[2] of the 1988 Act enables the insurers to raise defences against the claim of the claimants. In terms of clause [c] of sub-section [2] of section 149 of the Act one of the defences which is available to the insurer is that the vehicle in question has been used for a purpose not allowed by the permit under which the vehicle was used. In terms of clause [c] of sub-section [2] of section 149 of the Act one of the defences which is available to the insurer is that the vehicle in question has been used for a purpose not allowed by the permit under which the vehicle was used. Such a statutory defence available to the insurer would be obliterated in view of the decision of this Court in Satpal Singh's case [2000] 1 SCC 237." 20. In Asha Rani's case [supra], the Hon'ble Apex Court was considering a case of unauthorized passengers travelling in a goods vehicle. In that context, it was held that it is one of the defence which is available to the insurer under section 149[2][a][i][c] of the Act, whether the vehicle has been used for a purpose not allowed by the permit under which the vehicle was used. Hence, the case on hand is distinguishable from Asha Rani's case [supra]. (emphasis supplied) 13. A Division Bench of this Court in the case of United India Insurance Company Limited And Others v. Chandamma And Others,ILR 2000 KAR 1302 as held as follows: 6. Admittedly, the ground spelt out under subclauses (b), (c) and (d) of clause (a)(i) and the ground under clause (b) of Section 149(2) are not applicable to the defence of insurers in these cases. On the other hand, an attempt had been made for the insurers to bring their cases within the purview of the defence ground envisaged in sub-clause (a) of sub-section (2)(a)(i). This ground is also not available to them for the reason that, admittedly, each of the offending vehicles was covered by a valid permit to carry passengers for hire or reward as they were "public service vehicles". Merely because these vehicles were stated to have stopped and picked up passengers on the permitted route, presumably in breach of their permit condition, that by itself does not constitute a statutory defence available in sub-section (2)(a)(i)(a) of Section 149. In fact, Section 149(2) of the New Act i.e., Act of 1988, corresponds to Section 96(2) of the Old Act i.e., Act of 1939. The same defence grounds as are contained in Section 149(2) of the New Act were existing as the defence grounds under sub-section (2)(b) and (c) of Section 96 of the Old Act. In fact, Section 149(2) of the New Act i.e., Act of 1988, corresponds to Section 96(2) of the Old Act i.e., Act of 1939. The same defence grounds as are contained in Section 149(2) of the New Act were existing as the defence grounds under sub-section (2)(b) and (c) of Section 96 of the Old Act. Similar question had arisen for consideration of the Division Bench of this Court in the case of K.V. Thimmegowda v. Kamalamma' and the same had been answered holding: "An Insurance Company is liable to pay compensation in respect of the injury to or death of a third party, caused by a motor accident by a motor vehicle, which is a stage carriage while plying or being used lawfully otherwise than as a stage carriage, at a public place, even if such public place does not lie on the route in respect of which it is permitted to operate as a stage carriage". Therefore, in law the appellants/petitioners insurers are not exempt from their liability to pay compensation under their respective 'Act Policies' by mere reason of 'contract carriages' in question being plied as 'stage carriages' in breach of their permit condition since such a defence plea is not permissible under sub-section (2) of Section 149 of the Act. If the said vehicles were found to have been plying in breach of their permits condition, it is open for the concerned authorities under the Act to take appropriate action as is permissible under other provisions thereof viz., Sections 86, 177 and 192, as the case may be. Therefore, we find the contention of the learned Counsel for appellants/writ petitioners without force and weight and the appeals are, therefore, bound to fail. (emphasis supplied) 14. Having regard to the discussion as noticed above, it is clear that the interpretation of Section 207 as also Section 149(2) of the Act and having notice the beneficial nature of the legislation, it is just and proper that the view of expressed in the case of Rehana Begum and United Insurance Company is required to be followed. 15. In view of the aforementioned, the following order is passed: ORDER i) The above appeal is allowed; ii) The judgment and award dated 21.08.2012 Passed in MVC No.921/2010 on the file of the II Additional Senior Civil Judge and VI Additional MACT, Davanagere, is modified to the extent ordered herein. 15. In view of the aforementioned, the following order is passed: ORDER i) The above appeal is allowed; ii) The judgment and award dated 21.08.2012 Passed in MVC No.921/2010 on the file of the II Additional Senior Civil Judge and VI Additional MACT, Davanagere, is modified to the extent ordered herein. In all other respects, the judgment and award of the Tribunal remain unaltered; iii) The judgement of the Tribunal fastening the liability to pay the compensation awarded on the owner, who was arrayed as respondent No.2 before the Tribunal and appellant herein in the present appeal be set aside and it is ordered that the compensation awarded by the Tribunal shall be paid by the Insurer, who was arrayed as respondent No.3 before the Tribunal as well as the present appeal. iv) The Insurer shall deposit the compensation awarded together with accrued interest within eight weeks from the date of receipt of a copy of this judgment; v) The amount deposited in the above appeal be refunded to the appellant. vi) It is submitted that the above appeal having abated vide order dated 10.12.2021 the amount deposited by the appellant has been transmitted to the Tribunal. In the event, the claimants have withdrawn the amount transmitted to the Tribunal, the Insurer shall pay the said amount to the owner of the vehicle. vii) Registry to draw the modified award accordingly; viii) No costs.