Claim petition, in the instant case, was filed and the insurer was arrayed as party at later stage for the simple reason that it was not known to the claimant as to who was the insurer of the offending vehicle. The name of the insurer was disclosed by the insured during the pendency of the claim application and only thereafter the insurer was arrayed as party respondent in the claim petition. Thus, how it can be said that the claimant is not entitled for interest or interest is to be recovered from the owner prior to arraying of the insurer as a party respondent. {Para 6}
7. The purpose of mandate of the Insurance Act, read with the mandate of sections 146 to 149 of the Act, is that the owner is under legal obligation to get the vehicle insured and the purpose of insurance is that third parties, as also the damage caused to the vehicle by the driver, are protected. Thus, by no stretch of imagination, it can be said that the liability of the insurer to pay interest starts from the date of its impleadment as party in the claim petition.
8. It is also well established that a person who is impleaded as party to a lis in terms of Order 1, rule 10 of the Code of Civil Procedure (for short, the CPC), he becomes party to the lis right from the date of institution of the lis, and thus, it cannot be claimed that the petition is barred by time and he should be saddled with the liability from the date of impleadment. If that ground was available to the insurer, it should have questioned the impleadment order, which it has not. The insurer has accepted the order of impleadment and has not made any murmur.
12. Thus, from the bare perusal of the above provision, it is clear that section 171 of the Act mandates that the claimant is entitled to interest from the date of filing of the claim petition or from the date of the judgment and not earlier to that. Section 171 of the Act nowhere provides that in case a party is arrayed in the claim petition at a subsequent date, that party has to be saddled with the interest from the date of impleadment and not prior to that. Having said so, no case is made out for interference. Accordingly, the impugned award is upheld and the appeal is dismissed.
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
F.A.O. No. 215 of 2008
Decided On: 07.08.2015
United India Insurance Co. Ltd. Vs. Manohar Lal and Ors.
Hon'ble Judges/Coram:
Mansoor Ahmad Mir, C.J.
Citation: 2016 ACJ 1612 (HP), MANU/HP/1387/2015.
1. Appellant insurer, by the medium of instant appeal, has questioned the award dated 13.12.2007, passed by the Motor Accidents Claims Tribunal, Fast Track Court, Shimla (for short, 'the Tribunal'), in Claim Petition No. 54-S/2 of 2005/2000, titled Manohar Lal v. Ranjna Rao, whereby compensation to the tune of Rs. 1,72,000, with interest at the rate of 9 per cent from the date of filing of the claim petition till realization, was awarded in favour of the claimant, and the insurer was saddled with the liability (for short, 'the impugned award'). The claimant, the driver and the owner have not questioned the impugned award, thus, the same has attained finality so far as it relates to them.
2. Feeling aggrieved, the appellant insurer has questioned the impugned award on the grounds taken in the memo of appeal.
3. Learned Senior Advocate appearing for the appellant insurer, during the course of hearing, argued that insurer is aggrieved by the impugned award only to the extent of saddling it with interest from the date of filing of the claim petition. He submitted that the insurer was to be saddled with the interest from the date of its impleadment in the claim petition. While projecting his argument, he has relied upon sections 149 (2) and 171 of the Motor Vehicles Act, 1988 (for short, 'the Act').
4. The argument, though very attractive, is devoid of any force for the following reasons.
5. Granting of compensation in claim petitions is a social legislation and is for the benefit of the claimants. Procedural laws, wrangles and tangles, technicalities and niceties have no role to play. The main aim and object of Chapter XII of the Act is that the claimants are compensated as early as possible so that they do not fall prey to social evils.
6. Claim petition, in the instant case, was filed and the insurer was arrayed as party at later stage for the simple reason that it was not known to the claimant as to who was the insurer of the offending vehicle. The name of the insurer was disclosed by the insured during the pendency of the claim application and only thereafter the insurer was arrayed as party respondent in the claim petition. Thus, how it can be said that the claimant is not entitled for interest or interest is to be recovered from the owner prior to arraying of the insurer as a party respondent.
7. The purpose of mandate of the Insurance Act, read with the mandate of sections 146 to 149 of the Act, is that the owner is under legal obligation to get the vehicle insured and the purpose of insurance is that third parties, as also the damage caused to the vehicle by the driver, are protected. Thus, by no stretch of imagination, it can be said that the liability of the insurer to pay interest starts from the date of its impleadment as party in the claim petition.
8. It is also well established that a person who is impleaded as party to a lis in terms of Order 1, rule 10 of the Code of Civil Procedure (for short, the CPC), he becomes party to the lis right from the date of institution of the lis, and thus, it cannot be claimed that the petition is barred by time and he should be saddled with the liability from the date of impleadment. If that ground was available to the insurer, it should have questioned the impleadment order, which it has not. The insurer has accepted the order of impleadment and has not made any murmur.
9. A reference may be made to the decision of the Supreme Court in Urmilla Pandey v. Khalil Ahmad, MANU/SC/0494/1994 : 1994 ACJ 805 (SC), wherein the claimants produced before the Apex Court the insurance cover note, for the first time, issued in 1969, i.e., 25 years ago and on such fact, the Apex Court while setting aside the judgment of the High Court and of the Tribunal, held the insurer liable to pay compensation and interest as well. It is apt to reproduce paras 10 and 11 of the said decision hereunder:
"(10) We are satisfied that the car with registration No. UPC 8527 was insured with Premier Insurance Co. Ltd. and Canara Motor and General Insurance Co. Ltd. New India Assurance Co. Ltd., respondent in the appeal herein, being the successor of the said companies is liable to pay the award money as an insurer.
(11) The Tribunal has grossly erred in computing the compensation amount. The Tribunal was not justified in assuming the life expectancy to be 58. It could not be less than 65 even at that point of time. The Tribunal also fell into error in making 33 per cent deduction for the lump sum payment. As a matter of fact, no payment till date has been received by the unfortunate family. The amount of Rs. 40,600 awarded by the Tribunal is quite low. Without going into various heads under which the appellants could be compensated, we are of the view that in order to do complete justice between the parties, the appellants be awarded Rs. 1,20,000 (rounding off the figure of Rs. 1,17,747.70 as claimed by the appellants). We order accordingly. On the amount of Rs. 1,20,000, the appellants shall be entitled to 12 per cent per annum interest from the date of the application before the Tribunal. The total amount shall be paid by the insurance company to Urmilla Pandey, the widow, on her behalf and on behalf of her two children within three months from today. In case the amount is not paid within the period of three months, the insurance company shall be liable to pay interest at the rate of 18 per cent per annum thereafter. The amount shall be paid by way of a demand draft in the name of Urmilla Pandey."
10. Gujarat High Court in Oriental Insurance Co. Ltd. v. Aminaben Rahimbhai Kadiwala, MANU/GJ/0104/2001 : 2003 ACJ 175 (Gujarat), has held as under:
"(5) We have considered both these cases and the factual aspects of the case before us. It is undisputed that the accident took place on 2.3.1986. It is equally undisputed that the claim petition was preferred on 30.7.1986. There is no dispute regarding the fact that the appellant insurance company was impleaded on 29.3.1996 and thereafter the Tribunal gave notice to the appellant on 30.4.96. There was, thus, about ten years' delay in impleading the insurance company, appellant. However, since the impleadment was granted on 29.3.1996, it will relate back to the date of presentation of the claim petition, i.e., 30.7.1986 and it will be deemed by a fiction of law that the insurance company was already before the Tribunal on 30.7.1986. There seems to be no reason to distinguish compensation and interest and hold that the compensation is payable by the insurance company from the date of the petition but not the interest."
(Emphasis supplied)
11. Even otherwise, section 171 of the Act deals with the awarding of interest. It is apt to reproduce section 171 hereunder:
"171. Award of interest where any claim is allowed.--Where any Claims Tribunal allows a claim for compensation made under this Act, such Tribunal may direct that in addition to the amount of compensation simple interest shall also be paid at such rate and from such date not earlier than the date of making the claim as it may specify in this behalf."
12. Thus, from the bare perusal of the above provision, it is clear that section 171 of the Act mandates that the claimant is entitled to interest from the date of filing of the claim petition or from the date of the judgment and not earlier to that. Section 171 of the Act nowhere provides that in case a party is arrayed in the claim petition at a subsequent date, that party has to be saddled with the interest from the date of impleadment and not prior to that. Having said so, no case is made out for interference. Accordingly, the impugned award is upheld and the appeal is dismissed.
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