Sunday, 23 June 2019

Whether court should grant compensation if person authorized to drive vehicle dies due to accident?

Further, this Court also finds that although the plea that the deceased would enter into the shoes of the owner of the vehicle in the circumstances, when he is authorized to drive the vehicle, was not taken by the Insurance Company before the learned court below, but, certainly, there is no doubt, that the liability under the policy would be governed by the terms and conditions of the insurance policy and it was specifically pleaded by the Insurance Company that the liability would be governed by the terms and conditions of the policy. This Court finds that the point regarding extent of liability of the Insurance Company on the ground that the deceased enters into the shoes of the owner, is based on facts as narrated by the claimants and supported by the owner of the vehicle. It is the case of the claimants as well as the owner of the vehicle that the deceased was authorized to driver the vehicle and no additional evidence on this point is required to be adduced by the parties and the specific plea of the appellant insurance company that the liability under such circumstances would at most be to the extent of Rs. 2 lakhs can be considered being a point of law on the facts admitted and projected by the claimants themselves.

IN THE HIGH COURT OF JHARKHAND AT RANCHI

M.A. No. 57 of 2012

Decided On: 25.04.2019

TATA AIG General Insurance Co. Ltd.  Vs.  Shakuntala Ganeriwal and Ors.

Hon'ble Judges/Coram:
Anubha Rawat Choudhary, J.



1. Heard Mr. Ashutosh Anand, counsel appearing on behalf of the appellant.

2. Heard Mr. K.K. Singh, counsel appearing on behalf of the Respondents-Claimants.

3. This appeal has been filed against the Judgment and Award dated 08.02.2012 passed by the learned Principal District Judge-cum-Motor Vehicle Accident Claims Tribunal, East Singhbhum, Jamshedpur, in Compensation Case No. 28 of 2011, whereby the learned Tribunal has been pleased to allow the claim application of the claimants u/s. 166 and has held the appellant liable to compensation of Rs. 11,00,000/- with interest @ 6% from the date of filing i.e. 28.01.2011 till realization.

4. Counsel for the appellant submits that the only point which is involved in this appeal is whether the deceased who was authorized to drive the vehicle, by the owner of the vehicle, is covered under the insurance policy and if so, to what extent.

5. He submits that the facts in the instant case are not much in dispute. The specific case of the claimants before the learned Tribunal was that the deceased Saurav Ganeriwal was driving Car No. JH 05V 2229 and on 04.02.2009 near Chas More on Purulia Road, in order to save a cow, the car met with an accident and the car turned turtle. Pursuant to the accident, the deceased sustained serious injuries and died during treatment.

6. Counsel for the appellant submits that the further case of the claimants was that the deceased was a cloth merchant and was earning an amount of Rs. 20,000/- per month and was aged about 25 years. The First Information Report was lodged by the owner of the vehicle on 22.02.2009 being Purulia P.S. Case No. 34 of 2009 and the car was insured with the appellant. The claimants were the dependents of the deceased and accordingly they claimed compensation. He further submits that after service of notice, the opposite parties appeared. The opposite party no. 1 owner of the vehicle, did not dispute the contents of the claim application. The Insurance Company, appellant herein, also appeared and filed show cause denying and disputing the maintainability of the claim application itself and totally denying the liability of the Insurance Company.

7. The specific case of the Insurance Company before the learned court below was that the victim himself was driving the vehicle and therefore claim application under Section 166 of the Motor Vehicles Act, 1988, is not maintainable. The First Information Report was registered against the victim and the F.I.R. itself was belated and without any justification for delay. The returns on the basis of which it was contended that the deceased had income of Rs. 20,000/- per month, were itself filed after the death of the deceased and no income tax returns/proof of income prior to his death was filed. Accordingly, the deceased came into the category of unnamed driver, who was not covered under the policy. He further submits that a person driving the vehicle with the permission of the insured steps into the shoes of the insured and cannot be treated as 3rd party as held by Hon'ble Supreme Court in the judgment reported in MANU/SC/0802/2009 : 2009 ACJ 2020 (Ningamma and Ors. Vs. United India Insurance Co. Ltd.).

8. Counsel for the appellant while referring to the impugned judgment and award has submitted that on the basis of the pleadings, the following issues were framed by the learned Tribunal and all the issues were decided in favor of the claimants:-

(I) Whether the claimants have any cause of action of right to sue and the case is maintainable in its present form?

(II) Whether the deceased died in a motor vehicle accident which took place on 4/2/2009?

(III) Whether the vehicles were duly insured under the O.P. Tata AIG General Insurance Co. Limited and there is any violation of Contract between the insurer and insured?

(IV) Whether the claimants are entitled to receive compensation amount and if so, what should be quantum of compensation?

(V) Whether the claimants are entitled to get any other relief or reliefs as claimed by them?

9. The counsel for the appellant submits that while deciding the issues, the learned Tribunal did not consider the fact that the deceased was driving the vehicle after being authorized by the owner of the vehicle and accordingly, was not a 3rd party and further ignored the fact that in such circumstances, the deceased steps into the shoes of the owner of the vehicle. As per the insurance policy involved in this case, additional premium of Rs. 100/- was paid for the personal injury of the owner of the vehicle and the insurance coverage on this account, was only to the extent of Rs. 2,00,000/-.

10. He further submits that it has been held by the Hon'ble Supreme Court that if a person authorized to drive the vehicle, dies due to accident, then he steps into the shoes of the owner of the vehicle and he will be entitled to compensation only under the circumstances, when he proves before the Court that there was no rash and negligent act on his part. The counsel further submits that it was for the claimants to prove before the learned court below that there was no rash and negligent act on the part of the deceased and having not done so, the Insurance Company was not liable to pay compensation amount to the claimants. The counsel submits that without prejudice to the aforesaid submission, the compensation, if any, can at best be directed to be paid only to the extent of Rs. 2,00,000/- and no more as explained above.

11. Counsel for the appellant has referred to a judgment passed by this Court reported in MANU/JH/0857/2006 : 2007 ACJ 1272 (Sita Devi and Anr. Vs. Shailesh Kumar Sinha and Anr.) to submit that it has been observed by this Court at Para 9 of this judgment that the then principle of res ipsa loquitur applies and the manner in which the vehicle turned turtle itself indicates that there was rash and negligent act on the part of the deceased. He has also referred to another judgment of Hon'ble Supreme Court reported in MANU/SC/0802/2009 : (2009) 13 SCC 710 (Ningamma and Another vs. United India Insurance Company Limited) to submit that this is an elaborate judgment on the point of applicability of various sections of Motor Vehicles Act, 1988 and at Para-19 of the said judgment, it has been held that a bare perusal of the provisions would make it explicitly clear that persons like the deceased of the case before the Hon'ble Supreme court would step into the shoes of the owner of the vehicle. In that case, it was held by the Hon'ble Supreme court that the liability of the Insurance Company to pay compensation to the legal representative of the deceased, who had stepped into the shoes of the owner of the vehicle, could not have been treated as a claim for compensation under Section 163-A of Motor Vehicles Act, 1988. He submits that it has been further held that when such a claim is made by legal representative of the deceased, it has to be proved that the deceased himself was not responsible for the accident by his rash and negligent driving so as to make the Insurance Company liable to make payment to the heirs of such deceased person. He submits that in Para-27 of the aforesaid judgment, it has been held that Section 147 of Motor Vehicles Act, 1988 provides that the policy of the insurance could also cover cases against any liability, which may be incurred by the insurer in respect of death or fatal injury to any person including owner of the vehicle or his authorized representative carried in the vehicle or arising out of the use of vehicle in the public place.

12. The counsel for the appellant referred to the insurance policy involved in this case and submits that as per the insurance policy itself, additional premium has been paid to the extent of Rs. 100/- to cover the liability arising out of personal accident to owner-cum-driver and the extent of liability covered under the said policy for owner-cum-driver, is to the extent of Rs. 2,00,000/- only. In the instant case, if the claimants could have proved that there was no rash and negligent act on the part of the deceased, then the claimants would be entitled to a compensation of an amount of Rs. 2,00,000/- and no more.

13. He further submits that the claimants had produced income tax returns of the deceased which has been filed after his death and no returns were filed which were filed by the deceased prior to his death. He submits that the returns filed by the claimants and the deceased after the death of the deceased, cannot be taken into account and accordingly, there was no evidence regarding the income of the deceased.

14. He further submits that if the first point regarding coverage of liability only to the extent of Rs. 2,00,000/- is decided in favour of the appellant, then the other issue regarding the quantum of his income need not be answered.

15. Counsel appearing on behalf of the respondents-claimants, on the other hand, submits that the points which have been raised by the appellant have been raised for the first time in the appeal and no such points were ever raised in the written statement. He submits that the appellant is estopped from raising such plea for the first time at the appellate stage. He has referred to a few Judgments passed by Hon'ble Supreme Court reported in MANU/SC/0771/2013 : (2013) 12 SCC 84 (Ramchandra vs. Regional Manager, United India Insurance Company Ltd.) Para-26 and MANU/SC/0774/2013 : (2013) 12 SCC 202 (Rekha jain and Another vs. National Insurance Company Limited) Para-17 to submit that the Insurance Company ought to have taken this plea that even if it is assumed that the deceased was authorized by the owner to drive the vehicle, then the liability is limited only to the extent of Rs. 2,00,000/-. The Insurance Company having not taken such a plea before the learned Tribunal, it is not open to them to take this point at this stage.

16. In response, counsel for the appellant has submitted that the Insurance Company has taken a specific plea before the learned court below that the coverage is only to the extent, which is covered by the insurance policy and no more and otherwise also, it is the insurance policy which is the basis of all claims and if any liability is not covered under the insurance policy read with the judicial pronouncements, then such amount cannot be awarded and there cannot be any estoppel against law. He further submits that it was the specific case of the claimants themselves that the deceased was authorized to drive the vehicle by the owner and further the owner of the vehicle in the First Information Report had stated that the owner had authorized the deceased to drive the vehicle.

17. After hearing the counsel for the parties and after considering the materials on record, this Court finds that the main point for consideration before this Court is

whether the accident had taken place due to any rash and negligent act of the deceased who was driving the vehicle and if the answer is in the negative, then, what would be liability of the appellant insurance company?

And

whether there can be any estoppel against the appellant from raising the plea that the liability, if any, can at best be limited to an amount of Rs. 2 lakhs, under the facts and circumstances of this case?

18. Admittedly, the claimants had filed claim application under Section 166 of the Motor Vehicles Act, 1988 claiming to be the legal representatives of the deceased, who as per claim petition had expired due to accident and the vehicle involved in the accident was JH 05V 2229. There is no dispute that the vehicle on the date of the accident was covered by the insurance policy issued by the appellant. The specific case of the claimants was that the deceased was in the vehicle with his friends in the aforesaid car and the deceased was driving the vehicle. A cow came in front of the said car and in saving the cow the accident took place and ultimately the deceased died due to the accident. The claimants had exhibited the First Information Report as exhibit-1 which was filed on 22.02.2009 being Purulia P.S. Case No. 34 of 2009 by the owner of the vehicle, wherein the owner of the vehicle had stated that the owner had authorized the deceased to drive the vehicle. After investigation, the final form/report (exhibit-2) was also filed by the police and the police in the final form/report has found that the deceased tried to save the cow, but the vehicle met with an accident which resulted in grave injuries and ultimate death of the deceased. From the perusal of exhibit-1 and 2, this Court finds that there is no allegation regarding rash and negligent act on the part of the deceased in the First Information Report. The Insurance Company had filed its show cause before the learned court below and the Insurance Company completely denied its liability to pay compensation, as the deceased was neither a 3rd party nor a paid driver of the insured and the policy does not cover the list of any gratuitous passenger and no additional premium for such coverage was paid by the insured against the policy. This Court finds no such plea which was taken by the Insurance Company that the accident had taken place due to rash and negligent act of the deceased and no such evidence was led by the Insurance Company. This Court finds that there was enough material on record, including Exhibit Nos. 1 and 2 to show that there was no rash and negligent act on the part of the deceased in driving the vehicle and the accident had taken place in order to save a cow which happened to come on the way of the vehicle involved in this case. Accordingly, this Court finds and holds that there was no rash and negligent act in driving the vehicle by the deceased and the initial onus on the part of the claimants was duly discharged in this regard and there was no contrary pleading or evidence of the appellant on this point. This Court further finds that no issue on the point of rash and negligent act of the deceased was framed by the learned court below, as the parties did not join issue on this point, but the learned court below while deciding issue no. II has clearly held that the manner of accident was supported by oral evidence as well as Exhibit Nos. 1 and 2. However, this Court has held above that there was no rash and negligent act of the deceased in driving the vehicle involved in this case which met with the accident. Accordingly, this point is decided in favour of the claimants.

19. Further, this Court also finds that although the plea that the deceased would enter into the shoes of the owner of the vehicle in the circumstances, when he is authorized to drive the vehicle, was not taken by the Insurance Company before the learned court below, but, certainly, there is no doubt, that the liability under the policy would be governed by the terms and conditions of the insurance policy and it was specifically pleaded by the Insurance Company that the liability would be governed by the terms and conditions of the policy. This Court finds that the point regarding extent of liability of the Insurance Company on the ground that the deceased enters into the shoes of the owner, is based on facts as narrated by the claimants and supported by the owner of the vehicle. It is the case of the claimants as well as the owner of the vehicle that the deceased was authorized to driver the vehicle and no additional evidence on this point is required to be adduced by the parties and the specific plea of the appellant insurance company that the liability under such circumstances would at most be to the extent of Rs. 2 lakhs can be considered being a point of law on the facts admitted and projected by the claimants themselves. Accordingly, the aforesaid preliminary objection raised by the respondents, regarding new plea being raised by the Insurance Company, is hereby rejected. This Court finds that in the judgment passed by the Hon'ble Supreme court in the judgement reported in MANU/SC/0771/2013 : (2013) 12 SCC 84 the Hon'ble Supreme court did not permit new plea to be taken at the appellate stage because the new plea involved in the said case would have required additional evidence. This Court is of the considered view that the said judgement does not apply to the facts and circumstances of this case.

20. So far as the judgement reported in MANU/SC/0774/2013 : (2013) 12 SCC 202 is concerned, the counsel for the respondent claimants has relied upon para 17 of the said judgement in which para 15-16 of the judgement reported in MANU/SC/0810/2002 : (2002) 7 SCC 456 has been quoted dealing with section 149 of the Motor Vehicles Act, 1988 which in turn deals with the point that the insurer can take statutory defences which have been provided u/S 149(2) of the aforesaid Act of 1988 and no more and therefore if the insurer was to file and appeal the challenge in the appeal would confine to only those grounds. In the instant case, the case of the appellant is that the deceased having been authorized to drive the vehicle steps into the shoes of the owner of the vehicle is covered by the insurance policy. It is not the case of the appellant that there is any breach of the insurance policy, rather it has been argued that the policy covers the accident but the liability under the policy is only to the extent of Rs. 2 lakhs and no more. Accordingly, this Court finds that the aforesaid judgement passed by the Hon'ble supreme court as relied upon by the counsel for the respondent claimants does not apply to the facts and circumstances of the case.

21. This court finds that in the judgement passed by the Hon'ble Supreme Court, reported in MANU/SC/0802/2009 : (2009) 13 SCC 710 ((Ningamma and Another vs. United India Insurance Company Limited), as relied upon by the appellant, it has been held in as follows:-

18. In Oriental Insurance Co. Ltd. v. Rajni Devi wherein one of us, namely, Hon'ble S.B. Sinha, J. was a party, it has been categorically held that in a case where third party is involved, the liability of the insurance company would be unlimited. It was also held in the said decision that 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 claimant against the insurance company would depend upon the terms thereof. It was held in Oriental Insurance Co. Ltd. case 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 6 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.

In a case wherein the victim died or where he was permanently disabled due to an accident arising out of the aforesaid motor vehicle in that event the liability to make payment of the compensation is on the insurance company or the owner, as the case may be as provided under Section 163-A. But if it is proved that the driver is the owner of the motor vehicle, in that case the owner could not himself be a recipient of compensation as the liability to pay the same is on him. This proposition is absolutely clear on a reading of Section 163-A of the MVA. Accordingly, the legal representatives of the deceased who have stepped into the shoes of the owner of the motor vehicle could not have claimed compensation under Section 163-A of the MVA.

20. When we apply the said principle into the facts of the present case we are of the view that the claimants were not entitled to claim compensation under Section 163-A of the MVA and to that extent the High Court was justified in coming to the conclusion that the said provision is not applicable to the facts and circumstances of the present case.

However, the question remains as to whether an application for demand of compensation could have been made by the legal representatives of the deceased as provided in Section 166 of the MVA. The said provision specifically provides that an application for compensation arising out of an accident of the nature specified in subsection (1) of Section 165 may be made by the person who has sustained the injury; or by the owner of the property; or where death has resulted from the accident, by all or any of the legal representatives of the deceased; or by any agent duly authorised by the person injured or all or any of the legal representatives of the deceased, as the case may be.

When an application of the aforesaid nature claiming compensation under the provisions of Section 166 is received, the Tribunal is required to hold an enquiry into the claim and then proceed to make an award which, however, would be subject to the provisions of Section 162, by determining the amount of compensation, which is found to be just. Person or persons who made claim for compensation would thereafter be paid such amount. When such a claim is made by the legal representatives of the deceased, it has to be proved that the deceased was not himself responsible for the accident by his rash and negligent driving. It would also be necessary to prove that the deceased would be covered under the policy so as to make the insurance company liable to make the payment to the heirs.

In this context, reference could be made to relevant paras of Section 147 of the MVA which read as follows:

"147. .....
24. There are indeed cases like New India Assurance Company Limited v. Sadanand Mukhi and Ors. MANU/SC/8479/2008 : AIR 2009 SC 1788,

Wherein, the son of the owner was driving the vehicle, who died in the accident, was not regarded as third party. In the said case the court held that neither Section 163A nor Section 166 would be applicable."

22. The other judgment which has been relied upon by the counsel for the appellant is reported in MANU/PH/0593/2014 : 2015 ACJ 907 (United India Insurance Co. Ltd. Vs. Sidharat Raju and Others) decided by Hon'ble Punjab and Haryana High Court, wherein it has been held that the legal representative of the deceased who has stepped into the shoes of the owner of the motor vehicle cannot claim compensation under Section 163-A of Motor Vehicles Act, 1988 and further it was also examined as to whether a claim could have been made under Section 166 of Motor Vehicles Act, 1988 and ultimately held that the deceased stepped into the shoes of the owner of the vehicle and therefore the claimant could not be said to the third party for the purposes of awarding compensation under the Act and the benefit of the insurance policy is restricted to the personal insurance cover to the owner and personal accident cover is a contract between the insured and the insurer.

23. In the judgment passed by Hon'ble Supreme Court reported in MANU/SC/0925/2018 : (2018) 9 SCC 801 (National Insurance Company Limited vs. Ashalata Bhowmik and Others) it has been held by the Hon'ble Supreme Court in a case where the deceased himself was the owner-cum-driver of the offending vehicle that the application for claim of compensation under Section 166 of the Motor Vehicles Act, 1988 was not maintainable and held that the liability of the Insurance Company would be only to the extent of personal accident coverage under the contract of insurance, which was in the said case to the extent of Rs. 2,00,000/-. The Hon'ble Supreme Court in the aforesaid judgment has followed the ratio of the law laid down by the Hon'ble Supreme Court in the case of Oriental Insurance Co. Ltd. Vs. Jhuma Saha reported in MANU/SC/7047/2007 : (2007) 9 SCC 263 and has quoted the relevant paragraph of the said judgment in Para 8, wherein it has been held that the liability of the Insurance Company is to the extent of indemnification of the insured against the third person and if the insured cannot be fastened with any liability under the provisions of Motor Vehicles Act, 1988, the question of the insurer being liable to indemnify the insured, therefore, does not arise.

24. This Court finds on the face of the insurance policy involved in this case; it appears that additional premium of Rs. 100/- was paid towards personal accident cover for the owner-driver amounting to Rs. 2,00,000/-.

25. This Court further finds that the accident in the instant case was not caused due to rash and negligent act of the deceased and was on account of unforeseen circumstances, when a cow came in front of the moving car and the deceased was authorized to drive the vehicle by the owner of the vehicle. This Court finds that as per the judgment passed by the Hon'ble Supreme Court and Hon'ble Punjab and Hariyana High Court relied upon by the counsel for the appellant, under such circumstance, the deceased steps into the shoes of the owner of the vehicle and is entitled to claim the amount only to the extent, it would have been payable to the owner himself. As per the Insurance policy, in case, the accident would have occurred, while the vehicle being driven by the owner himself, the liability would have been only to the extent of Rs. 2,00,000/- for which premium of Rs. 100/- was also paid. Since the deceased was not a third party and had stepped into the shoes of the owner of the vehicle, therefore, the liability to the extent of Rs. 11,00,000/- could not have been fastened upon the Insurance Company by the learned court below. Admittedly, in the instant case, no other vehicle was involved.

26. This Court finds that in view of the aforesaid findings, the liability of the insurance company is confined to the extent of Rs. 2,00,000/- which would be payable with interest @ 6% per annum from the date of filing of the claim petition till its payment, after deducting interim compensation amount, if any, paid to the claimants. The impugned award is accordingly modified.

27. This Court further finds that vide interim order dated 23.04.2019, there was an order restraining coercive steps against the appellant in the certificate proceeding which has been filed for realization of the amount involved in this case. As the impugned award is hereby modified to the extent indicated above, it is observed that if the entire liability to the extent of Rs. 2,00,000/- with interest @ 6% as mentioned above is deposited by the appellant before the concerned certificate officer, within a period of two months from today, then the concerned certificate officer shall pass appropriate order for dropping the certificate proceedings in accordance with law subject to payment of any further amount which may be otherwise payable by the appellant in the certificate proceedings arising out of the impugned judgement and award.

28. This appeal is accordingly disposed of.


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