United India Insurance Co. Ltd. and Others vs Uma Nagesh Kamat and Others

S. Sujatha, J.—These appeals arises against the common judgment and award passed by the MACT, Karwar in MVC Nos. 155/07, 156/07, 157/07 and 163/07.

The brief facts leading to these appeals are as follows:

- The husband of claimant in MVC No. 156/07 Shri Nawalchandra Kanekar was suffering from kidney problem. On 22.4.05. his wife and others were taking Nawalchandra in an ambulance bearing No. KA-30/G-212 from Karwar to Manipal for treatment. The driver of the said ambulance drove the said vehicle with a rash and negligent manner at high speed and dashed against a parked lorry bearing No. KA-05/AA-6566 near Nakate, Yadtara Village, Kundapur Taluk. As a result, an inmate of the said ambulance succumbed to the said injury at the spot (MVC No. 163/2007). Navalchandra Kankear had sustained injuries and he succumbed to the injuries while he was on the way to the hospital. The claimants in MVC No. 156/07 and 157/07 had also sustained injuries in the alleged accident. With these facts, claim petitions were filed by the claimants before the Tribunal seeking for compensation from the respondents.

The claim was resisted by the respondents denying the averments made in the claim petitions. The Tribunal after appreciating the evidence on record allowed the petitions in part awarding compensation to the petitioners with interest @ 6% p.a. from the date of petition till realisation which is as under:

(1) MVC No. 155/07 Rs. 3,92,000/-

(2) MVC No. 156/07 Rs. 50,000/-

(3) MVC No. 157/07 Rs. 29,000/-

(4) MVC No. 163/07 Rs. 7,02,000/-

Being dissatisfied by the said judgment and award passed by the Tribunal, the insurer as well as the owner are before this Court in these appeals.

Learned counsel appearing for the insurer challenging the liability as well as the quantum of the compensation awarded by the Tribunal firstly, contended that as per the insurance policy at annexure R3, the number of persons insured were two, As per Ex. R. 4 - the registration certificate, discloses the seats of the vehicle as 1 + 1. As such, the insurer is liable to indemnify the owner only as regards two persons travelling in the ambulance, the liability fastened on the insurance company as regards all the five inmates travelling in the ambulance is contrary to the terms and conditions of the insurance policy and the provisions of the Motor Vehicles Act, 1988 (hereinafter referred to as ''the Act'' for short). Secondly, it is contended that the driver of the ambulance had no valid licence at the time of occurrence of the accident. No endorsement was taken by the driver on the driving license to drive the Ambulance, the offending vehicle. Thus, there was breach of the policy and the insurer is not liable for the payment of compensation awarded by the Tribunal. Thirdly, contributory negligence is alleged on the driver of the parked vehicle. The Tribunal without appreciating the same, contrary to the provisions of Section 149(2) of the Act fastened the entire liability on the appellant/insurance company. Mainly, on these three grounds the challenge is made by the insurer on the liability is concerned. Learned counsel placed reliance on the Judgment of this Court in the case of Divisional Manager, National Insurance Co. Ltd., v. Laxmawwa in MFA 6227/2007 in support of his contention.

As regards the quantum, it is argued that the Tribunal awarded the compensation exorbitantly which is not proportionate to the injuries sustained by some claimants. There was no adequate material before the Tribunal to award the compensation excessively as far as the deceased are concerned. My attention was drawn to the quantum of compensation awarded in MFA No. 21115/2008 wherein the salary certificate of the deceased person produced at Ex. P. 5 disclosed the monthly income of Rs. 3185/- whereas, the Tribunal brushing aside the said clinching evidence determined the income of the deceased person at Rs. 6000/- per month contrary to the admitted evidence of the claimant.

Three appeals are filed by the owner i.e., the Government of Karnataka challenging the impugned judgment and award of the MACT, Karwar.

The learned Government Advocate appearing for the appellants submitted that no rash and negligent driving of the driver of the ambulance vehicle was proved. The accident occurred due to the contributory negligence of the drivers of both the vehicles i.e., lorry and ambulance for which the Tribunal ought to have fastened the liability on owner/insurer of both the vehicles. The Tribunal having come to the conclusion that the police having not filed any case against the driver of the lorry, fixing the entire liability on the owner-Government as well as on the insurer of the Government vehicle is erroneous and warrants interference by this Court.

The learned counsel appearing for the claimants placed reliance on Ex. R. 8 and contended that Ambulance-offending vehicle is a light motor vehicle (LMV) as per R.C. book. Even otherwise, the driver of the offending vehicle i.e., ambulance was authorised to drive heavy transport vehicle (HTV) with effect from 28.12.1998, renewed from time to time current at the time of accident. Thus, the defence taken by the insurance company regarding the breach of insurance policy since the driver of the vehicle had no valid licence at the time of occurrence of the accident is totally against the evidence placed on record. The document Ex. R. 3 prima facie speaks about the valid licence held by the driver of the offending vehicle (ambulance). As regards the insurance policy said to have been issued only for two persons based on the registration certificate of the vehicle is totally untenable. The schedule of premium annexed to the insurance policy - Ex. R. 3, discloses the additional premium collected by the insurance company towards the liability to passengers. It is vehemently argued by the learned counsel appearing for the claimants that the ambulance was covered with a package policy and not Act policy. The limits of liability provided under the insurance policy specifies Section - II(i) in respect of any one accident: As per Motor Vehicles Act, 1988.

The learned counsel placed reliance on the following judgments in support of his contentions:

(1) Shivarama Parameshwara Hegde Vs. Subray Honnappa Naik and The Divisional Manager United India Insurance Co. Ltd.,

(2) Amrit Lal Sood v. Kaushalya Devi Thapar & Ors. (C.A. Nos. 2195-2196/1996 decided on 17.03.1998)

(3) Bhagyalakshmi and Others Vs. United Insurance Co. Ltd. and Another etc.,

(4) National Insurance Company Ltd. Vs. Balakrishnan and Another,

(5) Yashpal Luthra and Another Vs. United India Insur. Co. Ltd. and Another,

(6) The General Manager, United Insurance Co. Ltd. Vs. M. Laxmi and Others,

Having heard the learned counsel appearing for the parties and perusing the records, it is noticed that, Ex. R8-driving license of the driver of the Ambulance (offending vehicle) discloses that the driver had a valid license to drive the Heavy Transport Vehicle (HTV) w.e.f. 28.12.1988, renewed from time to time, valid at the time of occurrence of the accident.

Ex. R. 3- the insurance policy covering the ambulance vehicle reveals that the insurer apart from collecting the basic premium prescribed has collected additional premium of Rs. 120/- towards liability to passengers.

Under Section 2(21) of the Act, Light Motor Vehicle means a transport vehicle or omnibus the gross vehicle weight of either of which or a motor car or tractor or road-roller the unladen weight of any of which, does not exceed 7,500 kilograms. Section 2(47) of the Act defines transport vehicle, which reads thus:

"transport vehicle" means a public service vehicle, a goods carriage, an educational institution bus or a private service vehicle."

The offending vehicle (Ambulance) is registered as Light Motor Vehicle with the laden weight of 2160 kgs. As per Ex. R7-Registration Certificate, the offending vehicle is a Light Motor Vehicle admittedly, driver had the license for Light Motor Vehicle. However, in view of the notification dated 05.11.2004 issued by the Government of India, Ambulance is a transport vehicle. If so, driver had the license to drive the heavy transport vehicle as evident from the licence Ex. R8. No further endorsement is required, if the driver had licence to drive heavy transport vehicle to drive a transport vehicle.

Learned counsel appearing for the insurance company argued that the additional premium collected is for covering the risk of the driver and yet another person limited to two as disclosed in the policy as well as in the Registration Certificate. It is an undisputed fact that the policy at Ex. R. 3 is a ''Package Policy'' and not ''Act Policy''. Section 147 of the Motor Vehicles Act postulates requirements of policies and limits of liabilities which reads thus:

Requirements of policies and limits of liability.

In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-

a. is issued by a person who is an authorised insurer; and

b. insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)-

i. Against any liability which may be incurred by him in respect of the death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;

ii. Against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place:

Provided that a policy shall not be required-

i. to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen''s Compensation Act, 1923, (8 of 1923.) in respect of the death of, or bodily injury to, any such employee-

a. Engaged in driving the vehicle, or

b. If it is a public service vehicle engaged as a conductor of the vehicle or in examining tickets on the vehicle, or

c. If it is a goods carriage, being carried in the vehicle, or

ii. To cover any contractual liability.

Explanation.--For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place.

3) xxxx xxxx

4) xxxx xxxx

5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those clauses of persons.

Thus, it is evident in respect of the vehicle covered under the ''Package Policy'', the insurer-company is statutorily liable to cover the risk against the death or bodily injury to any person or damage to any property of a third party. If the insurance policy is issued as required under Section 147(5) of the Act, the insurer is bound to indemnify the insured against the claim from the driver and the other category of persons mentioned in the policy. If the premium collected is to enlarge the liability more than the statutory limit provided or if it covers any other category of persons viz., passengers, the terms and conditions stipulated in the said policy binds the parties. It is manifest from the schedule or premium annexed to Ex. R. 3 that the insurer has collected additional premium of Rs. 120/- towards liability to passengers, a different category of persons covered by the insurance policy. The contention of insurance company is inexplicable, it is apparent that the amount of Rs. 120/- is collected towards liability to passengers, the arguments of the learned counsel for the insurer that it covers only the risk of the driver and another person, limited to two and not to the other passengers travelling in the ambulance is wholly untenable.

This Court in the case of Shivarama Parameshwara Hegde (supra) applying the ''Doctrine of contra proferentem'' interpreted similar clause in the insurance policy, held that the policy covers the risk of persons other than the driver. This Hon''ble Court has categorically held thus:

"22. It is therefore clear that the insurance company itself has not placed before the Court either a specific defence or substantive evidence to point out that this policy is only to the extent the Act provides. It is to our examination we found that the policy is undoubtedly a package policy and once it is seen that it is a package policy, then Sub-Section 5 of Section 147 comes into operation which mandates: "notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons".

Thus, it is clear that the category of persons mentioned in the policy for whose risk additional premium is collected are or different category/classes than the driver and hence, in terms of the policy, the insurer is liable to indemnify the insured against any claim from him."

Applying the principles of law laid down by the Division Bench of this Court (supra), the passengers mentioned in the policy for whose risk additional premium is collected are different class/category than the driver and as such the insurer is liable to indemnify the insured against the passengers who are classes of persons specified in the policy.

In the case of Amrit Lal Sood (supra), their Lordships of the Apex Court were considering the relevant clauses in the policy in Section II - liability to third parties. In that context, it is held that the insurance company is liable to meet the claim of the claimant, it is categorically held as follows:

"8. Thus under Section 111(a) of the policy the insurer has agreed to indemnify the insured against all sums which the insured shall become legally liable to pay in respect of death of or bodily injury to any person.'' The expression ''any person'' would undoubtedly include an occupant of the car who is gratuitously traveling in the car. The remaining part of clause (a) relates to cases of death or injury arising out of and in the course of employment of such person by the insured. In such cases the liability of the insurer is only to the extent necessary to meet the requirements of Section 95 of the Act. In so far as gratuitous passengers are concerned there is no limitation in the policy as such. Hence under the terms of the policy, the insurer is liable to satisfy the award passed in favour of the claimant. We are unable to agree with the view expressed by the High Court in this case as the terms of the policy are unambiguous".

In the case of Balakrishnan (supra), the Apex Court has held thus:

"21. In view of the aforesaid factual position, there is no scintilla of doubt that a "comprehensive/package policy" would cover the liability of the insurer for payment of compensation for the occupant in a car. There is no cavil that an "Act Policy" stands on a different footing from a "Comprehensive/Package Policy"."

The passengers in the ambulance are to be considered as third parties to whom the third party risks are directly applicable. At this juncture it is beneficial to refer to the Judgment of this Court in the case of The New India Assurance Company Limited, Bangalore Vs. Rajendra Singh and others, wherein it is held that, "furthermore, it becomes manifest that by virtue of the aforestated change in position of the law expanding the statutory liability of the insurer under New Act it necessarily follows that all victims of a motor accident other than the parties to the contract of insurance are third parties in relation thereto. This finding answers the II part of the said question".

In the case of Laxmawwa (supra), this Court was dealing with the case wherein the policy of insurance was in respect of a maxi cab which had the permit to carry 12 passengers, the policy of insurance was issued to cover the risk of 12 passengers and the driver. In such circumstances, it is held that, "Even if the vehicle had carried passengers more than the carrying capacity/permit i.e., over loaded, the insurer cannot avoid the liability but is liable in respect of the number of passengers for whom the insurance policy was issued. Merely because the vehicle involved in the accident was overloaded, it is not permissible for the insurance company to avoid the liability, but, its liability gets restricted and it will be liable in respect of whom policy was issued and it has to satisfy the higher of the various awards and deposit the higher of the amount of compensation awarded to the extent of number of passengers covered by the insurance policy, to ensure that the maximum benefit is derived by the insurance taken for the passengers".

The learned counsel appearing for the insurance company placed much emphasis on this Judgment to contend that the liability of the insurer is restricted only to two persons to cover the risk and not the passengers who accompanied the patient in the ambulance at the time of the occurrence of the accident. Having carefully examined the said Judgment referred to by the learned counsel, I am of the considered opinion that the said Judgment is rendered in a different context where the insurance company disputed the entire liability of indemnifying the risk taking a defence that the vehicle was over loaded much against the seating capacity and the terms of the insurance policy. The said Judgment is not applicable to the facts of the present case.

On the other hand, the Judgment relied on by the learned counsel for the claimants in the case of Shivarama Parameshwara Hegde cited supra is squarely applicable to the facts of the present case. Their Lordships while dealing with the similar issue has categorically held that the coverage of insurance is not relateable to the seating capacity of the vehicle. It is also pertinent to note that no explanation is offered by the insurance company for collecting extra premium to cover different category/class of persons i.e., passengers. The offending vehicle is covered by the package policy. The comprehensive or the package policy has a wider coverage to that of statutory Act policy as per the Judgments pronounced by the Apex Court. Section 147(5) of the Act specifically covers the liability against the death of or bodily injury to any passenger of offending vehicle.

''Ambulance'' is not defined under the Act. However, as per the notification of the Government of India dated 05.11.2004, ''Ambulance'' is a transport vehicle, which defines thus:

"''Ambulance'' means vehicle specially designed, construed or modified and equipped and intended to be used for emergency transportation of persons who are sick, injured, wounded or otherwise incapacitated. No seating capacity is mentioned."

Thus, Ambulance is a special vehicle used in emergency to provide transportation to sick or injured people to avail immediate medical treatment. It is a part of emergency medical service administering emergency care to those with acute medical problems. It is also necessary that a doctor or nurse and the attendant has to accompany the patient moving in an ambulance for treatment. Sometimes, it may also be necessary to provide the emergency treatment in the ambulance itself. So it cannot be interpreted that the permitted persons to travel in an ambulance was only two i.e., driver and the patient as contended by the insurer, which is totally untenable. The arguments advanced by the learned counsel for the insurer on these grounds are baseless not supported by any statutory provisions. Having regard to these aspects, in the light of the Judgments referred to above and the oral and documentary evidence available on record, coupled with the comprehensive policy or a package policy covering the risk of passengers for which the insurance company has taken additional premium enlarging the coverage, the liability of the insurer cannot be exonerated on the self denial of the insurance company.

As regards the quantum, it is noticed that the Tribunal has determined the income of the deceased in MFA No. 21115/2008 much against the oral and documentary evidence available on record at Rs. 6,000/- per month. Ex. P. 5 - the salary certificate produced by the claimant himself indicates the salary of the deceased at Rs. 3185/-. In such circumstances, it would be appropriate for this Court to modify the compensation awarded by the Tribunal assessing the income at Rs. 3185/- per month by which loss of dependency works out to Rs. 3,56,720/-. In all other respects, the compensation awarded by the Tribunal remains undisturbed.

The plea of contributory negligence taken by the Government is not supported by any evidence placed on record. It is noticed that the police have registered the case against the driver of the offending vehicle, not against the driver of the parked vehicle. It has come on record that the lorry was parked on the road as per the traffic rules. It is only due to the rash and negligent driving of the offending vehicle, the accident occurred, oral and documentary evidence proves the same. Vague contentions raised by the owner/Government of Karnataka to escape the liability of paying compensation to the victims of the accident is not appreciable. No cogent evidence is placed by the owner to absolve from the liability. No other ground is canvassed by the Government in support of their defence. Hence, the appeals filed by the Government deserves to be dismissed.

As far as the other appeals are concerned, no specific challenge is made by the insurance company regarding the quantum of compensation awarded.

For the foregoing reasons, MFA 21115/2008 is partly allowed modifying the compensation awarded by the Tribunal from Rs. 7,02,000/- to Rs. 3,86,720/-.. All other appeals are dismissed. Insurance company/appellant and Government of Karnataka are jointly and severally liable to pay the compensation to the claimants. The judgment and award passed by the Tribunal is confirmed except in MFA 21115/2008 as indicated above.

The amount in deposit shall be transmitted to the Tribunal concerned. The claimants are at liberty to withdraw the same.