BETALA TRANSPORT ORGANISATION vs Oriental Insurance Co. Ltd

THESE three appeals arise out of the common judgment passed by the learned District Forum, Kamrup at Guwahati in CP 24/91,26/91 & 27 of 1991. In CP 24/91 the accident occurred on 29.9.1989 while the vehicle was proceeding from Shillong to Jowai. In CP 26/91 the accident occurred on 29.3.1990 near Mangaldoi when the vehicle was proceeding to Mishamari. In CP 27/91 the accident occured on 2.5.1990 when the vehicle was proceeding towards Narengi from Barpeta Road. The claimant had a carriers liability policy with the Oriental Insurance Co. Ltd. and on the strength of this policy the claimant lodged claim for different amounts for the accidents. It may be stated herein that the vehicles involved in the accident were Oil Tankers and it is alleged that these vehicles carried oil and other lubricants at that point of time. The Insurance Company appeared in the case and filed written statement and took the stand that they are not liable to pay any compensation as it was a pure case of accident and the pure case of accident was specifically exempted by the clause of the policy. That portion of the policy is quoted below : "that during the currency of this policy or any further period for which it may be in force, subject to the limits, terms, provisions, exclusions, exceptions and conditions contained herein or endorsed hereon the Company hereby agrees to indemnify the insured against his legal liability for actual physical loss of or damage to goods or merchandise directly caused by fire and/or accident to the vehicle registered under No. 118-8998 whilst such goods or merchandise are actually transported in the said vehicle provided that fire or accident has arisen on account of negligence of the insured or negligence or criminal act of his servants and further provided that the vehicle is damaged by such fire or explosion or accident, and a claim in respect thereof is admitted under the motor comprehensive insurance policy covering the vehicle. The cover will commence with the leading of cargo on the vehicle and will be in force until unloading of the cargo at the discharging point or expiry of 3 days after the first arrival of the vehicle at the destination town whichever may first cover".

IN order to appreciate this contention let us have a look at the police report. IN one of the cases, it was stated that the accident took place due to bad road condition and it was a pure case of accident. This is with regard to CP No. 24/91. IN other two cases also there is such police report and in those cases also it was stated that these are purely accidental case. On behalf of the claimant Bijoy Kumar Betala examined himself as witness. No where he has stated that this accident was caused due to negligence of the driver. As per the insurance policy, the INsurance Company is liable to pay compensation on account of negligence of the insured or negligence or the criminal act of his servant or if the vehicle is damaged by fire or emplosion or accident. So, it was known to the claimant that if it was a pure case of accident and the INsurance Company shall not be liable for it. IN this case, claims were lodged beyond 6 months in each and every case. Further it appears that the Surveyor was appointed in one of the cases to survey the loss and the claimant did not co- operate with the Surveyor and the Surveyor had to submit the report as such. IN another case there is a report by one of the Surveyors but that is also after 1 month 18 days from the date of accident. Be that as it may, the learned District Forum, Kamrup dismissed the case on the grounds : (i) delay in lodging the claim, (ii) it is a case of pure accident, (iii) there is no material to arrive and/ or assess the loss claimed by the claimant. We have looked to the deposition of witnesses and in the deposition of the witnesses there is absolutely nothing regarding this claim. So, this finding that there was no material to assess the loss is absolutely correct finding arrived at by the learned Forum.

Mr. Sahewalla, learned Counsel submits that in every accident there will be some amount of negligence and he wants to rely on the doctrine "res ipsa loquitor". But that submission of Mr. Sahewalla cannot be accepted in view of the fact that this was specifically excluded in the insurance policy and the claimant once entered into the contract by knowing fully well the provisions, he cannot turn back and take advantage of it. Mr. Sahewalla, learned Counsel places reliance on the following decisions : 1. (1995) 5 SCC 482, LIC of India and Another v. Consumer and Others. That was with regard to insurance by the LIC and certain proposals initiated by some persons were rejected by the Corporation holding that it is not in conformity with the condition prescribed therein. Thereafter an application was filed under Article 226 of the Constitution of India for a mandamus to the LIC to enforce their rights to get the policy. The learned Single Judge dismissed the application. There was an appeal and the appeal was allowed by the Division Bench. As against that judgment of the Division Bench of High Court there was an appeal before the Supreme Court and the Supreme Court in that context considered the question. Table 58 laid down the conditions for acceptance of the policy. In paragraph 32 the Supreme Court has pointed out as follows: "An unfair and untenable or irrational clause in a contract is also unjust and amenable to judicial review. In common law a party was relieved from such contract. In Gillespie Bros. & Co. Ltd. v. Roy Bowks Transport Ltd. for the first time construing the idemnity clause in a contract questioned that are the Courts to permit party to enforce his unreasonable clause, even when it is so unreasonable, or applied so unreasonably, as to be unconscionable, and stated : "When it gets to this point, I would say, as I said many years ago,/... there is the vigilence of the common law which, while allowing freedom of contract, watches to sec that it is not abused''. It will not allow a party to exempt himself from his liability at common law when it would be quite unconscionable for him to do so".

THE Supreme Court pointed out that an unfair and untenable or irrational clause in a contract is also unjust and amenable to judicial review. This Commission cannot exercise the power of judicial review and we must accept the policy as it is. So, the contention of Mr. Sahewalla cannot be accepted. The other case relied on is II (1996) CPJ 18 (SC)=I (1997) ACC 123 (SC)= (1996) 4 SCC 647, B.V. Nagaraju v. Oriental Insurance Co. Ltd., Divisional Officer, Hassan. That was with regard to the claim arising out of a motor accident. In that case the vehicle carried passengers and the vehicle met with an accident. The question was whether the persons who met with the accident shall be entitled to the benefits of the insurance. The Supreme Court pointed out that mere breach of a condition of the insurance policy itself is not sufficient to wipe out the right of a person. Carriage of some human being is not the sole cause of the accident and the Insurance Company cannot avoid liability. That is not the situation herein.

IN view of that matter, we agree with the finding of the learned Forum that there was no materials to assess the loss, and the finding that this is beyond the terms of the policy. All these appeals are dismissed. Appeals dismissed.