The United India Insurance Co. Ltd. vs Smt. Vijay Laxmi Srivastava and Others

Heard Mr. R.C. Sharma, learned Counsel for the appellant and Mr. Pradeep Raje, learned Counsel appearing for the respondents.

By means of the instant First Appeal From Orders, the judgment and Award dated 19.4.2003 passed by the Motor Accident Claims Tribunal, Lucknow in Claim Petition No. 207 of 1997 Smt. Vijay Laxmi Srivastava and Ors. v. Shiv Kant Tripathi has been challenged inter alia on the grounds that the direction issued by the Motor Accident Claims Tribunal while awarding compensation to be paid by New India Assurance Company Limited is not in consonance with the law laid down by the Apex Court in the case of Oriental Insurance Co. Ltd. v. Sudhakaran K.V. and Ors. II (2008) CPJ 38 (SC) as there was no contract between Insurance Company and gratuitous passengers and further parties to the policy are not covered in the Insurance policy u/s 147 of the Motor Vehicles Act, 1988.

In nutshell, the case of the appellant is that the deceased-Vishnu Sanjai was working as an Accountant in U. P. Rajkiya Nirman Nigam, Lucknow and was drawing Rs. 6,228/- per month as his salary. On 24.4.2006, Vishnu Sanjai (since deceased) had gone to Faizabad on official duty. While returning from Faizabad, he hired the Commander Jeep No. UP-77/6676 at Faizabad. At about 10.30 p.m., on the National Highway near Village Palhari, the Commander Jeep collided with the truck. Since it was head-on collision, the jeep was badly damaged. The deceased was immediately admitted to the District Hospital. At about 1.40 a.m. he expired. The First Information Report was lodged by one Dhondhery Chowkidar of the area.

After considering the submissions advanced by the parties and the material furnished to the Tribunal, the claim petition was allowed vide the judgment and order dated 19.4.2003 with the directions that the claimants are awarded Rs. 5,85,300/- as compensation with 9% per annual interest thereon from the date of filing the petition, which shall be payable by the The United Insurance Company. The aforesaid amount of compensation shall be deposited by the Insurance Company in the account of M.A.C.T. within a period of one month. Out of the aforesaid amount, 50% shall be paid to the claimant No. 1, Srimati Vijay Laxmi Srivastava, while rest 50% amount shall be deposited separately in equal share, in F.D.R. in some Nationalized Bank in the names of minor claimant Nos. 1 and 2, Master Sachin and Baby Shailley for the period until they attain the age of majority.

Learned Counsel for the appellant challenges the impugned judgment and Award on the grounds that the Tribunal erred in holding that the driver of Jeep No. UP77/6676 was negligent. The alleged accident, as per deposition of the DW1, the driver of the jeep, was caused due to sole negligence of the Truck. The Tribunal erred in not believing the testimony of the driver of the Jeep, particularly when no evidence was on record to show that the jeep driver was negligent. The respondents 1 to 3 did not examine any eyewitnesses to prove the negligence of Jeep Driver. The respondents also did not attribute any negligence of the Driver in their claim petition.

Learned Counsel for the appellants submits that on the basis of the oral and documentary evidence, the only inference that could be reached was that the Truck Driver was negligent, whereas the Tribunal erred in fixing the liability on the appellant. There was violation of the terms and conditions of the policy which was placed on record and was duly proved by the officer of the appellant. The Tribunal erred on relying the case of Amritlal Sood and Anr. v. Smt. Kaushaliya Devi and Ors. which was not only on different facts, but has also been overruled in the case of Aha Rani, where the Apex Court has held that if the terms and conditions of the policy do not provide for carrying passengers and if in such a vehicle passengers are being carried, then in case of accident, the insurer would not be liable. In view of this, the appellant deserves to be exonerated from his liability.

Further, it was the case of the claimants that the deceased had hired the car for return journey and the Tribunal also held accordingly. In view of this finding, the breach of policy conditions stood confirmed and the appellant ought to have been exonerated. The claimants did not file any original documents and the Tribunal committed an error on relying upon the photocopies of the documents. Claim Petition Nos. 51 and 134 of 1997 were compromised by the appellant on the basis of 50% liability, that too, when the evidence of driver was not on record in those cases. As each case has to be decided on the basis of evidence on record, the Tribunal has erred in imposing the liability on the appellant against the evidence on record.

In support of his submissions, learned Counsel for the appellant has relied upon the judgments passed in the cases of Oriental Insurance Co. Ltd. v. Shri Nanjappan and Ors. 2004 (2) TAC 12 (S.C.) , New India Assurance Company Vs. Shri Satpal Singh and Others, and National Insurance Co. Ltd. v. Bhukya Tara and Ors. 2009 (3) TAC 385 (S.C.).

While defending the judgment passed by the Motor Accident Claims Tribunal, learned Counsel for the respondents submits that the grounds taken in the F.A.F.O. have been considered by the Tribunal. He submits that the Apex Court in a number of cases has provided that the awarded amount shall be paid to the aggrieved party by the Insurance Company and Insurance Company can recover the same from insurer i.e. owner of vehicle etc. In support of the aforesaid submission, he has relied upon the Apex Court Judgment in Oriental Insurance Co. Ltd. v. Nanjappan and Ors. AIR 2004 Supreme Court 1630, wherein the Apex Court has held that the insurer is liable to pay the quantum of compensation fixed by the Tribunal to the claimants at the first instance and recover it from insured and for the purpose of recovering the same from the insured owner of vehicle, the insurer shall not be required to file a suit. It may initiate a proceeding before the concerned Executing Court as if the dispute between the insurer and the owner was the subject-matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer.

Learned Counsel further pointed out that the Apex Court in the case of National Insurance Co. Ltd. Vs. Challa Bharathamma and Others, after considering the object of the Motor Vehicles Act, 1988 was of the opinion that it would be proper for the insurer to satisfy the award, though in law it has no liability. In such cases the insurer has been given the option and liberty to recover the amount from the insured. For the purpose of recovering the amount paid from the owner, the insurer shall not be required to file a suit. Further, he submits that after considering the entire evidence and material on record, the impugned Judgment and Award has been passed. Therefore, there is no illegality in the impugned judgment and Award.

We have perused the impugned judgment and Award and we are of the opinion that the Award passed by the Motor Accident Claims Tribunal did not require any interference as the same has been passed on the basis of evidence as well as statements including documents, which have been filed before the Tribunal. Motor Vehicles Act is a beneficial statute and as such, in spite of the fact that the Insurance Company under law has no liability to pay the compensation but keeping in view the objects of the Act, which are beneficial in nature, it would be proper for the insurer to satisfy the award and accordingly, the Tribunal has directed the Insurance Company to pay the same and further directed to recover the same from the owner of the vehicle.

Consequently, in view of above, the judgment and Award dated 19.4.2003 is modified to the extent that the liberty is being given to the Insurance Company to recover the amount in question from the owner of the vehicle, in accordance with law. Further, the appellant is directed to deposit the entire awarded amount within four weeks before the Motor Accident Claims Tribunal, Lucknow from today.

With the aforesaid observations and directions, the F.A.F.O. is partly allowed.