New India Assurance Co. Ltd. vs Saroj Rani and others

Kannan, J.—The insurance company is in appeal against the award passed for death of a driver of a vehicle, which was involved in motor accident. The basis of the claim in the petition was that insured''s driver one Balbir Singh was driving the vehicle and when he complained of headache the deceased Shailender Pushp Goyal took to the steering and met with an accident. It was contended in the petition that the tyre of the said car got detached and fell off on account of which car turned turtle and capsized resulting in injuries to the occupants and fatal injuries to Shailender Pushp Goyal. The response by the insurance company was that the deceased was not a third party as per the Motor Vehicles Act and the vehicle was driven against the terms and conditions of a policy, without authority or consent or approval or knowledge of the car owner. The owner of the car examined himself when he said that the deceased Shailender Pushp Goyal was his relative and he had given the vehicle to him for driving. The suggestion on behalf of the insurance company to the owner was that the vehicle was driven only by his driver and he had handed it over without his concurrence. It was also suggested on behalf of the insurer that the driver Balbir Singh had handed over the vehicle to Shailender Pushp Goyal. He further denied the suggestion that he failed to maintain the car in a perfect roadworthy condition. In fact, the contention on behalf of the insurance company was that there had been negligence on the part of the owner to maintain the car properly and the accident was the result of such mechanical failure as the tyre flew away and the vehicle turned turtle and capsized.

Now the learned counsel appearing on behalf of the insurance company seeks to rely on the statement of the owner, quite inconsistent with his own case before the Tribunal that the vehicle had been entrusted by the owner only to the deceased for driving and he being not a third party, the insurance company is not liable. The case gives right to one of two situations that have distinct legal ramifications.

(i) If the vehicle had been entrusted by the owner to his own driver and he in turn had handed over the vehicle to the deceased to drive even without the owner''s concurrence as contended by the insurance company, the deceased/ driver steps into the shoes of the owner and a claim could not be maintained in the light of the judgment of the Hon''ble Supreme Court in Ningamma and Another Vs. United India Insurance Co. Ltd., .

(ii) On the other hand, if the vehicle had not been properly maintained by the owner and, therefore, a passenger or a driver in the vehicle met with an accident, it is still the negligence of the owner in not maintaining the vehicle that makes an action possible for the legal representatives of the deceased. A driver, who is a ''workman'', would have a right of action against the owner since an ''Act Policy'' is bound to cover the risk for death or bodily injury of a workman under the Act, u/s 147 of Motor Vehicles Act. However, if the driver is the owner or a person stepping into his shoes, the claim is not tenable against the insurer.

The learned counsel refers to decisions of the Hon''ble Supreme Court in Dhanraj Vs. New India Assurance Co. Ltd. and Another, and Oriental Insurance Co. Ltd. Vs. Smt. Jhuma Saha and Others, . Both are cases of death of owner-cum-driver where there was no personal insurance cover. The Hon''ble Apex Court in both those cases held that the owner could not be treated as a third party and, therefore, the liability cannot be fastened.

This principle may be inapplicable to a passenger in a vehicle when there was an entrustment of the vehicle by the owner to his own driver and if an accident had taken place. But when the passenger takes to the driver''s seat, he is not a third party, but a person stepping into the shoes of the owner. The learned counsel also refers to a judgment of the Hon''ble Apex Court in New India Assurance Company Ltd. Vs. Sadanand Mukhi and Others, , that dealt with a case of a situation where the person, who drove the vehicle, was not a paid driver and, therefore, an Act Policy will not cover the situation of a person who assumed the risk of driving.

I have cited the last three decisions for the sake of complete treatment of the decisions relied on by the counsel for the petitioner but I rest the ultimate finding in favour of the insurer to the judgment in Ningamma and Another Vs. United India Insurance Co. Ltd., .

The award of the Claims Tribunal is set aside and the appeal is allowed.