National Insurance Co. Ltd. vs Mahadeb Kar and Others

M.G. Mukherji, J.—On 4th July, 1975, while proceeding from Krishnagar Bus Station towards Kalna Ghat, Stage Carraige WGE 1264 driven by the respondent no. 1, Mahadeb Kar, near the crossing of National Highway No, 34 and Krishnagar Road had collided with Stage Carriage No. WGE 1195, which was coming from the opposite direction. As a result of the said accident, Mahadeb Kar, the claimant respondent no. 1, was seriously injured and was admitted into hospital, where his right leg was amputed. He had remained confined to bed in the hospital till 20th of July, 1975 and thereafter he was treated at home.

On 3rd September, 1975 Mahadeb Kar filed before the Motor Vehicles Claims Tribunal, Nadia, an application u/s 110A of the Motor Vehicles Act, claiming Rs. 342240- as compensation for his said injuries. Originally, the respondent nos. 1, 2 and 3, described as partners of the West Bengal Transports, owner of WGE 1195, the driver of the said vehicle and the insurer, National Insurance Company Ltd., were made opposite parties to the said application u/s 110A of the Motor Vehicles Act. The owners of WGE 1264 of which Mahadeb Kar was the driver, were also made parties.

The opposite parties 1(i) to 1(iii) in the said Claim Case had alleged before the Tribunal below that they were no longer owners of WGE 1195. Since October, 1972 Sm. Ghanubala Sadhukhan and Arun Kumar Sadhukhan had become the owners of WGE 1195. Therefore, the Tribunal had added the said two persons as opposite parties. Gopal Krishna Dutta and Nemai Krishna Dutta who were described in the claim petitition as owners of WGE 1264, had also disclosed that by reason of transfer made by the firm Nemai Krishna Dutta and Brothers, Gopal Krishna Dutta had become the sole proprietor and owner of WGE 1264.

We find no substance in the submission made on behalf of the appellant National Insurance Company Ltd, that the case u/s 110A of the Motor Vehicles Act filed by the present respond no. 1, was barred by limitation against said Gopal Dutta and also against Sm. Ghanubala Sadhukhan and Arun Kumar Sadhukhan.

The said question of limitation was not raised before the Tribunal below and we also hold that in any case there was sufficient cause for condoning the delay, if any, in joining the transferee owners of the Stage Carriage No. WGE 1195 as opposite parties in the claim case. Only after the previous owners of WGE 1195 had disclosed the names of the present owners of the said stage carriage, the applicant before the Tribunal could pray for adding them as opposite parties. Gopal Krishna Dutta originally was impleaded as a partner of the firm owning WGE 1264''and he was subsequently described as the sole owner of the stage carriage and therefore no question of addition of a new party could arise.

The Motor Accidents Claims Tribunal, Nadia allowed the said claim case and directed the opposite party no. 3 (the present appellant) to pay Rs. 45100 as compensation to the petitioner, Mahadeb Kar (the ''respondent no. 1) herein. The appellant, Insurance Company, being aggrieved thereby has filed the present appeal.

The appellant, National Insurance Company Ltd., which was the insurer of both the vehicles, WGE 1195 and WGE 1264, has contended before us that in view of the finding by the Tribunal below that the accident in question was due to rash and negligent driving of the Vehicle No. WGE 1264 by the claimant-respondent no. 1, Mahadeb Kar, neither the insurer nor the insured had any legal liability to pay any compensation to him.. The submission on behalf of the appellant is that u/s 95 of the Motor Vehicles Act proof of negligence is necessary before the owner the Insurance Company could be held liable for the payment of compensation in a motor accident claim case. In this connection, reliance has been placed upon the observations of the Supreme Court in the case of Minu B. Mehta and Another Vs. Balkrishna Ramchandra Nayan and Another, . In the said reported case the Supreme Court did not however, interfere with Tribunal''s finding that the accident in question was due to the rash and negligent driving by the driver of the lorry which had dashed against the car driven by the applicant who was a practising doctor, causing injuries to him and also the respondent no. 2, who was the other occupant of the car. The Supreme Court had rejected the arguments made on behalf of the owners of the lorry that the accident was due to mechanical defect which was a latent one and same was not discoverable by the use of reasonable care and that therefore they were not liable to pay any compensation. A Division Bench of the Karnataka High Court in D. Jogamma v. S. Govindaswamy (1983) 54 Com Cas 879, applied the ratio of the decision in the case of Mina B. Mehta v. Balkrishna Ramchandra (supra) and held that accident having occurred due to rash and negligent driving of the vehicle by the deceased driver himself his legal representatives cannot claim compensation under the Motor Vehicles Act, their remedy was under the Workmen''s Compensation Act.

These reported decisions were rendered in the context of sub-sections (1) and (2) of section95 read with section 96 of the Motor Vehicles Act, where an Insurance Policy had been issued in terms of section 95 of the Motor Vehicles Act. Proof of negligence on the part of the insured would be necessary in order to make the insurer and the insured liable for payment of compensation and a person who is himself negligent can not claim compensation against an insurance Company which has only covered risks u/s 95 of the Motor Vehicles Act.

In the aforesaid two reported cases the court had however no occasion to consider the extent of the Insurer''s liability under a Comprehensive Policy covering all kinds of risks. When under an insurance policy the liability of the insurer was not limited to the requirement of section 95(1) of the said Act, then the insurer''s extent of liability would be governed by the terms of the particular policy. Only in the absence of a contract to the contrary the measure of the liability of the insurer would be ascertained with reference to section 95 (2) of the Motor Vehicles Act. An Insurance Company may however issue of a comprehensive policy agree; to cover all risks and in that event its liability would be more extensive than contemplated by section 95 of the Motor Vehicles Act. The extent of insurer''s liability in each case would be determined with reference to the terms of the particular policy (vide Sheikhupura Transport Co. Ltd. Vs. Northern India Transport Insurance Co., ; Oriental Fire and General Insurance Co. Vs. V. Ganapathi Ramalingam, ; United India Fire and General Insurance Co. Vs. Azeerunnisa and Others, at page 188, Satya Wati Pathak Vs. Hari Ram and Others, ).

Thus, in the instant case, we are required to determine whether according to the terms of the Insurance Policy issued by the Insurance Company the appellant was legally bound to indemnify the owner of the vehicle no WGE 1264 against his liability for personal injuries suffered by his employee, the claimant respondent no. 1 as a result of the aforesaid accident.

The decision of a learned Single Judge of the Madras High Court in T.M. Venkatarajan & another vs. T. Abdul Munaf Sahib and another (1970) 40 Comp Cas 911, was also cited by the learned advocates for the appellant. This reported decision does not really assist the appellant''s case. According to the learned Single Judge of the Madras High Court u/s 95 of the Motor Vehicles Act a statutory duty was cast upon the insurance company to indemnify the insured against any liability to pay compensation to his employee under the workmen''s Compensation Act. The learned Judge in the case of T. M. Venkatarajan & another v. T. Abdul Munaf Sahib and another (supra), further held that the liability of the insurance company to indemnify the employer against compensation payable under the Workmen''s Compensation Act would not be lost whether the claimants of the employee in exercise of their option resorted to the civil court or to the Claims Tribunal. The Claims Tribunal, it was held had jurisdiction to adjudicate upon a claim against the insurance company under the Workmen''s Compensation Act.

The Endorsement No. 18 attached to and forming part of the policy issued by the appellant Company in respect of, Vehicle No. WGE 1264 stated "In consideration of the payment of ac additional premium it is hereby understood that notwithstanding anything contained herein to the contrary the Company shall indemnify the insured against his legal liability under The Workmen''s Compensation Act, 1923 and subsequent amendments of that Act, prior to the date of this endorsement the Fatal Accidents Act, 1955 or at Common Law in respect of personal injuries to any paid driver (or cleaner or conductor or person employed in loading and or unloading) whilst engaged in the service of the Insured in such occupation in connection with the vehicle and will in addition be responsible for all costs and expenses incurred with its written consent". Thus, by the said Endorsement No. 16 the Insurance Company had undertaken to indemnify the owner of the Vehicle No. WGE 1264 of its legal liability to persons employed by him in connection with the operation and or maintaining etc. of the said motor vehicle. The said coverage was not confined only to the insured''s common law liability for personal injury suffered by its paid driver or cleaner or conductor or person employed in loading and unloading but also legal liability under the Workmen''s Compensation Act. Therefore even in rase a paid driver of the insured in course of his employment suffered injury on account of rash and negligent driving, the insurer as employer was liable to pay compensation and, according to the insurance policy issued by it, the appellant Insurance Company was bound to indemnify the insured owner against the said legal liability. Thus, the appellant Insurance Company by relying upon section 95 of the Motor Vehicles Act cannot deny its liability arising under the special Endorsement No. 16 attached to Comprehensive Insurance Policy issued by it.

The learned advocate for the appellant has urged that according to the court below the annual income of the claimant was Rs. 6614|- and therefore his monthly salary exceeded Rs. 500|- per month and he was not entitled to compensation under the provisions of the Workmen''s Compensation Act. Upon a proper construction of the Endorsement No. 16 we hold that the insurer had thereby agree to indemnify the insured against its liability to compensate for injury suffered by his paid employees on principles embodied in (he Workmen''s Compensation Act. In other words, the said endorsement covered all claims for injuries suffered by the paid employees of the insured in course of their employment. Therefore by relying upon the limitations imposed upon the jurisdiction of the Workmen''s Commissioner to entertain claims, the appellant company cannot question the jurisdiction, of the Motor Accidents Claims Tribunal to award compensation in a case covered by the said Endorsement No. 16 attached to an insurance policy.

The learned advocate for the appellant has next urged that both the insurance policies issued in favour of the respective owners of WGE 1195 and WGE 1264 expressly provided "This policy is not transferable to any other person or persons unless the Company''s written con sent has been obtained, if the Morton vehicle is disposed of you must return the certificate insurance at once, failure to do so is a punishable offence under the Motor Vehicles Act, 1939". Mr. choudhury has submitted that both the vehicle had been transferred without any consent of the Insurance Company and therefore, the Company was not liable to indemnify the transferee owners for their liability to pay compensation to their paid employees. It appears that in October, 1972 the previous owners of WGE 1195 had transferred the vehicle to Sm. Ghanubala Sadhukhan and Arun Kumar Sadhukhan. Under the Registered Deed of dissolution "of partnership Gopal Krishna Dutta had become the sole proprietor of the Vehicle No. WGE 1264. The Insurance Company did not adduce any evidence in the court below to the effect that the said vehicle had been transferred without its written consent. On the other hand, the appellant Company had every year renewed the said two insurance policies. The Insurance Policy (Ext. B) in respect of WGE 1264 had been issued on 12th September, 1974 for a period of one year. There had been no transfer of the vehicle after issue of the said renewed policy dated 12th September, 1974 and the reform the defence by relying upon the aforesaid clause prohibiting transfer without written consent of the Insurance Company was inapplicable in the instant case. The legal position might have been otherwise if after the insurance policy was issued on 14th September, 1974, the owners had transferred the vehicle without written consent of the Insurance Company. On the facts of this case, the aforesaid clause against transfer of the policy had no manner of application. The appellant Insurance Company did not also adduce any evidence before the Tribunal to the effect that in ignorance of the fact of transfer of the vehicle WGE 1195 in favour of the added opposite parties, Sadhukhans it had renewed the insurance policy in respect of the said vehicle. Similarly, the insuarance Company did not lead any evidence to the effect that it was not aware of the fact that as a result of dissolution of the partnership firm, Nemai Krishna Dutta & Bros., one of its partners, Gopal Krishna Dutta, had become the sole proprietor and owner of the other vehicle WGE 1264. In any case Gopal Krishna Dutta was previously a partner of the said firm which owned the vehicle WGE 1264 and therefore we are unable to hold any transfer of the policy was involved when said Gopal Krishna Dutta had become the sole owner and proprietor. We have also pointed out that after the policy in respect of the vehicle WGE 1264 was renewed, there was no transfer of the vehicle or change in the ownership of the same. For the foregoing reasons, we find no merit in this appeal. We accordingly dismiss this appeal without any order as to costs. No decree need be drawn up. Let a copy of this order be communicated to the court below.

There is no merit in the Cross-Objection. The Cross-Objection is, therefore, dismissed without any order as to costs.