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2024 DIGILAW 67 (KAR)

Moinuddin S/o Waliyuddin Quareshi v. Shivaraj S/o Mallappa @ Mallikarjun Patil

2024-01-22

LALITHA KANNEGANTI

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JUDGMENT : LALITHA KANNEGANTI, J. 1. This appeal is filed by the owner of the offending vehicle aggrieved by the judgment and award passed in M.V.C. No. 716/2013 on the file of the Prl. Senior Civil Judge and MACT, Kalaburagi, dated 08.09.2017, questioning the liability fixed on the owner of the offending vehicle. 2. The claim petition was filed seeking compensation of an amount of Rs. 32,50,000/- for the injuries sustained by the claimant in the accident. The facts of the case are that on 04.02.2013 at about 07.15 a.m. the claimant is traveling in Toyota Innova Car from Aland to Tirupati. At that time, the driver of the vehicle drove the same in a rash and negligent manner and lost control over the vehicle. The Car dashed to the pole located on the side of the road, the Car turtled the claimant including other passengers sustained injuries. The claimant had sustained grievous injuries on his forehead and right leg. He was taken to the Hospital and he had spent huge amounts for treatment. 3. The Tribunal had granted the compensation of an amount of Rs. 13,37,782/-. When it comes to the liability, the Tribunal had held that as per the evidence of the claimant, the vehicle was used for hire by the claimant and others for going to Tirupati on the date of accident. The claimant and other passengers are not relatives of the owner of the vehicle. The Tribunal had observed that the claimant had failed to prove that the insurance policy was issued, covering the risk of the inmates of the offending vehicle. As per Ex.D.1, the insurance policy is covering the risk of the inmates of the offending vehicle. The Tribunal had observed that as per Ex.D.1 the risk of owner cum driver and one employee is covered. 4. As per Ex.D.1, the insurance policy is covering the risk of the inmates of the offending vehicle. The Tribunal had observed that as per Ex.D.1 the risk of owner cum driver and one employee is covered. 4. The Tribunal had also extracted the condition No. (i) of the insurance policy (liability to 3rd parties), “the agreement is made that death of or bodily injury to any person including occupants carried in the vehicle (provided such occupants are not carried for hire or reward), but except so far as it is necessary to meet the requirements of Motor Vehicles Act, the company shall not be liable where such death or injury arises out of and in the course of the employment of such person by the insured.” It is observed by the Tribunal that the evidence on record clearly establishes that the claimant was traveled in the offending vehicle for hire. As per the policy, the risk of the inmates is not covered. Hence, it is held that the owner of the vehicle alone is liable to pay the compensation. 5. The learned counsel appearing for the appellant/owner of the vehicle submits that the insurance policy is a comprehensive policy and as per the comprehensive policy, all the inmates are covered. It is submitted that basing on the order passed by the High Court of Delhi, the insurance company had issued the circulars, wherein it is made clear that in respect of the comprehensive/package policy, the inmates of the vehicle are covered. Subsequent thereto several appeals are withdrawn by the insurance company. He submits that the finding of the Tribunal in this case that though it is a package policy, the inmates are not covered, is contrary to their own circulars and contrary to the settled law. 6. The learned counsel had relied on an order passed by the Coordinate Bench of this Court in the case of Bhimaraya Hanamantray Baichalbal vs. Sri. Gudusab and Another in MFA No. 31908/2012 along with MFA No. 31747/2012, dated 12.11.2020. 7. In the said appeals, the Tribunal had fastened the liability on the owner of the vehicle exonerating the insurance company. The said appeals are preferred by both the claimant and the owner of the vehicle. Gudusab and Another in MFA No. 31908/2012 along with MFA No. 31747/2012, dated 12.11.2020. 7. In the said appeals, the Tribunal had fastened the liability on the owner of the vehicle exonerating the insurance company. The said appeals are preferred by both the claimant and the owner of the vehicle. The learned Judge had referred to the judgment of the Division Bench of this Court in the case of United India Insurance Company Limited vs. Kalawathi, 2011 (1) MACR 11 (KAR) with regard to the discrimination between paid inmate and gratuitous inmate, when the vehicle is covered with the comprehensive policy. 8. Another judgment in the case of Oriental Insurance Company Limited vs. Kum. G. Navya and Another, 2011 Kant. M.A.C. 409 (Kant) was considered and held that when a private Car is used on hire basis it is an infraction under the provisions of Motor Vehicles Act, for which the separate penalty may be imposed as per the M.V. Act. However, since, it is clear that the risk of the inmates of the Car is covered under the comprehensive policy, the insurance company is liable to pay the compensation. It is further observed by the learned Judge that it does not make any difference between a Car carrying the inmates involved in an accident is a private Car or public passage Car. Therefore, it cannot make any difference as far as inmates of the Car are concerned so far as covering the risk is concerned. Further, it is also observed that the owner of the Car had given his private Car on hire basis and he should not be saddled with the liability as per the provisions of the M.V. Act, as the policy issued is a comprehensive policy. Accordingly, the Court had modified the order passed by the Tribunal and held that the insurance company is liable to pay the compensation. 9. In the said case, the judgment of the Hon’ble Supreme Court in the case of National Insurance Company Limited vs. Balkrishnan, (2013) 1 SCC 731 case was also considered by the learned Judge, wherein the Hon’ble Supreme Court was pleased to define the difference between the Act Policy/Statutory Policy/Liability only Policy and Comprehensive/Package Policy. 10. 9. In the said case, the judgment of the Hon’ble Supreme Court in the case of National Insurance Company Limited vs. Balkrishnan, (2013) 1 SCC 731 case was also considered by the learned Judge, wherein the Hon’ble Supreme Court was pleased to define the difference between the Act Policy/Statutory Policy/Liability only Policy and Comprehensive/Package Policy. 10. He had also relied on another judgment of this Court in the case of Manager, Royal Sundaram Insurance Company vs. Lakkappa S/o Siddappa Mestri and Others in MFA No. 22146/2012, dated 16.09.2021, where the appeal is filed by the insurance company, challenging the award passed by the Tribunal. 11. Basing on these judgments, it is submitted that in the similar circumstances, the owner of the vehicle is exempted from the liability. He submits that the said judgment of the learned Single Judge applies on all four corners to the facts of the case and the liability may be fastened on the insurance company. 12. The learned counsel appearing for the insurance company submits that when there is violation of terms and condition of the insurance policy, the insurance company is not liable to pay the compensation. He submits that the Tribunal had discussed about the particular clause, wherein it is stated that where the vehicle is used on hire or reward, the insurance company is not liable to pay the compensation. The Tribunal had rightly dealt with the material on record and rightly exempted the insurance company. 13. The learned counsel appearing for the claimant submits that the policy is a package policy. The claimant is 3rd party to the insurance policy. The insurance company is liable to pay the compensation. The Tribunal without applying the settled law had saddled the owner of the vehicle with the liability, which is not correct. He also relied on the very same judgment, which is relied upon by the learned counsel for the appellant-owner of the vehicle and submits that the insurance company alone is liable to pay the compensation. 14. Having heard the learned counsel on either side, perused the entire material on record. 15. The material on record and evidence on record i.e., the evidence of the claimant shows that the vehicle is used for hire and no other contra evidence is placed in that regard. 14. Having heard the learned counsel on either side, perused the entire material on record. 15. The material on record and evidence on record i.e., the evidence of the claimant shows that the vehicle is used for hire and no other contra evidence is placed in that regard. On behalf of the owner it is clear that the vehicle is used contrary to the terms and conditions of the policy and there is clear violation of the terms and conditions of the policy. 16. In this case, the Tribunal had observed that as per the policy, the inmates of the vehicle are not covered. That observation of the Tribunal is not correct, as the policy is a comprehensive policy, the inmates of the Car are covered. Then coming to the judgment relied on by the learned counsel for the appellant-owner of the vehicle in the case of Bhimaray Hanamantray Baichalbal, referred supra, this Court has dealt with the scope of comprehensive policy and also the other judgments passed by this Court and the Hon’ble Supreme Court. 17. Absolutely, there is no dispute about the fact that when it is a comprehensive policy, the inmates are covered and the insurance company is liable to pay the compensation. Here the important aspect that has to be considered is about the violations of terms and conditions of the policy. Particularly when the appellant is the owner of the vehicle. At this juncture it is appropriate to extract the relevant condition in the contract: “(liability to 3rd parties), the agreement is made that death of or bodily injury to any person including occupants carried in the vehicle (provided such occupants are not carried for hire or reward), but except so far as it is necessary to meet the requirements of Motor Vehicles Act, the company shall not be liable where such death or injury arises out of and in the course of the employment of such person by the insured.” 18. It is settled proposition of law that while construing the terms of a contract or a contract of insurance, the words used in the contract must be given paramount importance and it is not permissible to the Court to add or substitute the words. It is settled proposition of law that while construing the terms of a contract or a contract of insurance, the words used in the contract must be given paramount importance and it is not permissible to the Court to add or substitute the words. The policy of insurance is an undertaken given by the insurer to indemnify the loss suffered by the insured on account of risk covered by the policy, as such the terms conditions of the policy have to be strictly construed. The contract has to be interpreted as per the intention of the parties. Particularly when the terms and conditions of the contract are plain and unambiguous the Courts are bound to give effect to the meaning. Insurance Companies are holding the public money and they are accountable to the public. There cannot be any difference between a contract of insurance and any other contract. The parties to the contract are bound by the terms and conditions and they cannot be permitted to take a different stand contrary to the terms of the contract. 19. When the appeal is filed by the claimant, as he is a 3rd party to the insurance policy and policy being a comprehensive policy, the insurance company can be made liable to pay the compensation, inspite of violation of terms and conditions of the policy by applying the principle of pa and recover. But the same analogy cannot be applied in a case of owner of the vehicle, because he is a party to the policy of insurance and he is bound by the terms and conditions of the policy. 20. This Court is not able to agree with the finding of the Co-ordinate Bench of this Court in the case of Bhimaray Hanamantray Baichalbal that when the policy is a comprehensive policy, inspite of violation of terms and conditions policy, it is the insurance company which is liable to pay the compensation, but not the owner of the vehicle. The series of judgments of the Hon’ble Supreme Court are consistent that the parties to the contract are governed by the terms and conditions of the policy. A policy of insurance is a contract between the insurer and insured. The parties are governed by the terms and conditions of the contract. The series of judgments of the Hon’ble Supreme Court are consistent that the parties to the contract are governed by the terms and conditions of the policy. A policy of insurance is a contract between the insurer and insured. The parties are governed by the terms and conditions of the contract. As per the terms and conditions of the policy issued in this case, the vehicle shall not be used for hire or reward. If the vehicle is used for hire and reward, the insurance company is not liable to pay the compensation. The Court is always considering the flight of the claimant/3rd party who are not parties to the contract, has been holding that the insurance company is liable to pay the compensation and recover the same from the owner of the vehicle, but in this case, the owner is before this Court and who was plying the vehicle on hire, in clear violation of the terms and conditions of the policy. Under these circumstances, this Court cannot fasten the liability on the insurance company and the owner alone is liable to pay the compensation. 21. Accordingly, the appeal of the owner of the vehicle is dismissed. 22. The amount in deposit shall be forthwith transferred to the Tribunal.