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Judgment
D. Hariparanthaman, J.—The appellant is the Insurance Company. The first respondent travelled in the lorry owned by the third respondent as a Load man. The second respondent was the driver of the lorry. The lorry was insured with the appellant herein. The lorry capsized and the first respondent received grievous injuries and suffered 90% permanent partial disability. He filed M.C.O.P. No. 121 of 2000 claiming, Rs. 7 lakhs as compensation.
The Tribunal passed an award, dated 05.06.2002, granting Rs. 7 lakhs as compensation, though the Tribunal found that the first respondent is entitled to Rs. 9,98,067/- as compensation. The Tribunal restricted the award to Rs. 7 lakhs, since, the claimant claimed only Rs. 7 lakhs as compensation. The Tribunal awarded the amount as claimed by the claimant. This appeal is by the Insurance Company against the said order.
Heard the submissions made by the learned Counsel appearing on either side.
The learned Counsel for the first respondent raises question as to the maintainability of the appeal on the ground that the appellant/insurance company failed to get permission from the Tribunal to file an appeal challenging the award on the grounds other than the grounds that are available u/s 149(2)(a) of the Motor Vehicles Act. The learned Counsel further submits that the application filed by the appellant u/s 170 of the Motor Vehicles Act was rejected by the Tribunal on 01.03.2002. Hence, the appeal itself is not maintainable. The learned Counsel seeks to reject the appeal on this ground alone.
On the other hand, the learned Counsel for the appellant submits that the Tribunal rejected the application seeking permission to contest the case on all grounds that are available to the owner of the lorry, u/s 170 of the Motor Vehicles Act, by a non-speaking order. Therefore, it should be taken that permission was granted by the Tribunal. The learned Counsel further submits that since the lorry owner did not choose to file an appeal, the Insurance Company should not be deprived the right to challenge the appeal questioning the award.
I have considered the submissions made by the learned Counsel appearing on either side and perused the records.
The issue lies in a narrow campus. I am not going into the merits of the matter. Now, the issue is as to whether the Insurance Company could maintain an appeal u/s 173 of the Motor Vehicles Act without obtaining permission from the Tribunal u/s 170 of the Motor Vehicles Act to contest the matter on the grounds that are available to the owner of the vehicle.
Section 170 of the Motor Vehicle is extracted hereunder:
Impleading Insurer in certain cases.--Where in the course of any inquiry, the Claims Tribunal is satisfied that--
(a) there is collusion between the person making the claim and the person against whom the claim is made, or
(b) the person against whom the claim is made has failed to contest the claim, it may, for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaded as a party to the proceeding and the insurer so impleaded shall thereupon have, without prejudice to the provisions contained in Sub-section (2) of Section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made.
Section 170 of the Motor Vehicles Act came for consideration by the Three Judges Bench of the Honourable Supreme Court in National Insurance Co. Ltd., Chandigarh Vs. Nicolletta Rohtagi and Others, . The matter was referred to three Judges Bench as there was conflict of opinion between two judgments rendered by two Judges Bench one in Smt. Rita Devi and Others Vs. New India Assurance Co. Ltd. and Another, and the other in United India Insurance Co. Ltd. Vs. Bhushan Sachdeva and Others, . The three Judges Bench considered the matter in detail and held in para 18 as follows:
...The consistent view of this Court had been that the insurer has no right to file an appeal to challenge the quantum of compensation or finding of the Tribunal as regards the negligence or contributory negligence of offending vehicle.
The three Judges Bench held that the Honourable Apex Court in the earlier decisions, namely, in Shankarayya and Another Vs. United India Insurance Co. Ltd. and Another, and Narendra Kumar and Another Vs. Yarenissa and Others, , Chinnama George and Others Vs. N.K. Raju and Another, and Smt. Rita Devi and Others Vs. New India Assurance Co. Ltd. and Another, categorically held that the insurer having not obtained permission u/s 170 of the Motor Vehicles Act, is not entitled to prefer an appeal to the High Court against the award on the grounds other than the grounds that are available u/s 149(2)(a) of the Motor Vehicles Act. But, contrary view is as taken in United India Insurance Co. Ltd. Vs. Bhushan Sachdeva and Others, and it was held that the insurer could file an appeal against the quantum of compensation awarded by the Tribunal since, the insured failed to contest the claim. The three Judges Bench has categorically held as follows in Para 23 of the said Judgement:
...In our view,the decision in United India Insurance (supra) does not lay down correct view of law for the reasons stated hereinafter.
The three Judges Bench gave detailed reasons for holding that the Insurance Company has no right to file appeal without obtaining permission u/s 170 of the Motor Vehicles Act and para 26 to 29 of the said Judgment are extracted hereunder:
For the aforesaid reasons, an insurer if aggrieved against an award, may file an appeal only on those grounds and no other. However, by virtue of Section 170 of the 1988 Act, where in course of an enquiry the Claims Tribunl is satisfied that (a) there is a collusion between the person making a claim and the person against whom the claim has been made or (b) the person against whom the claim has been made has failed to contest the claim, the tribunal may, for reasons to be recorded in writing., implead the insurer and in that case it is permissible for the insurer and in that case it is permissible for the insurer to contest the claim also on the grounds which are available to the insured or to the person against whom the claim has been made. Thus, unless an order is passed by the tribunal permitting the insurer to avail the grounds available to an insured or any other person against whom a claim has been made on being satisfied of the two conditions specified in Section 170 of the Act, it is not permissible to the insurer to contest the claim on the grounds which are available to the insured or to a person against whom a claim has been made. Thus where conditions precedent embodied in Section 170 is satisfied and award is adverse to the interest of the insurer, the insurer has a right to file an appeal challenging the quantum of compensation or negligence or contributory negligence of the offending vehicle even if the insured has not filed any appeal against the quantum of compensation. Sections 149, 170 and 173 are part of one Scheme and if we give any different interpretation to Section 172 of the 1988 Act, the same would go contrary to the scheme and object of the Act.
This matter may be examined from another angle. The right of appeal is not an inherent right or common law right, but it is a statutory right. If the law provides that an appeal can be filed on limited grounds, the grounds of challenge cannot be enlarged on the premise that the insured or the persons against whom a claim has been made has not filed any appeal. Section 149(2) of 1988 Act limits the insurer''s appeal on those enumerated grounds and the appeal being a product of the statute, it is not open to an insurer to take any other plea other than those provided in Section 149(2) of 1988 Act. The view taken in United India Insurance Company Limited v. Bushan Sachdeva (Supra) that a right to contest would also include the right to appeal is an act which requires legislative authority and no Court or tribunal can confer such right, it being one of limitation or extension of jurisdiction. Further, the view taken in United India Insurance (supra) that since the insurance companies are nationalised and are dealing with public money/fund and to deny them the right of appeal when there is a collusion between the claimants and the inured would mean draining out or abuse of public fund is contrary to the object and intention of the Parliament behind enacting Chapter XI of 1988 Act. The main object of enacting Chapter XI of 1988 Act was to protect the interest of the victims of motor vehicle accidents and it is for that reason the insurance of all motor vehicles has been made statutory compulsory. Compulsory insurance of motor vehicle was not to promote the business interest of insurer engaged in the business of insurance. Provisions embodied either in 1939 or 1988 Act have been purposely enacted to protect the interest or travelling public or those using road from the risk attendant upon the user of motor vehicles on the roads. If law would have provided for compensation to dependants of victims of motor vehicle accident, that would not have been sufficient unless there is a guarantee that compensation awarded to an injured or dependant of the victims of motor accident shall be recoverable from person held liable for the consequences of the accident. In Skandia Insurance Co. Ltd. Vs. Kokilaben Chandravadan and Others, , it was observed thus:
In other words, the legislature has insisted and make it incumbent on the user of a motor vehicle to be armed with an insurance policy covering third party risks which is in conformity with the provisions enacted by the legislature. It is so provided in order to ensure that the injured victims of automobile accidents or the dependants of the victims of fatal accidents are really compensated in terms of money and not in terms of premise. Such a benign provision enacted by the legislature having regard to the fact that in the modern age the use of motor vehicles notwithstanding the attendant hazards, has become an inescapable fact of life, has to be interpreted in a meaningful manner which serves rather than defeats the purpose of the legislation. The provision has therefore to be interpreted in the light of the aforesaid perspective.
We have noticed the legislative development in regard to third party rights in England and found that the object of those legislations was to protect the interest of third party rights. The 1939 Act as well as 1988 Act both were enacted on pattern of English statute with the object to relieve the distress and miseries of victims of accidents and reduce the profitability of the insurer in regard to occupational hazard undertaken by them by way of business activities and not to promote business interests of insurance companies even though they may be nationalised companies.
For the aforesaid reasons, as well as that the learned Judges in United India Insurance Company Limited(supra) have failed to notice the limited grounds available to an insurer u/s 149(2) of the Act, we are of the view that the decision in United India Insurance (supra) does not lay down the correct view of law.
In view of the categorical pronouncement of the Honourable Apex Court referred to above, the appeal is not maintainable and the same deserves to be rejected.
However, the learned Counsel for the appellant relies on a decision of the Honourable Apex Court in National Insurance Co. Limited v. Meghji Naran Soratiya and Ors. reported in 2009 (1) TN MAC 474 (SC) and submits that the appeal is maintainable. I have perused the judgement. I am not in agreement with the submissions by the learned Counsel for the appellant and in the above referred case, permission was obtained by the Tribunal u/s 170 of the Motor Vehicles Act to contest the case on all the grounds that are available to the owner of the vehicle. However, the order was a non-speaking order. In these circumstances, the High Court while hearing the appeal from the Insurance Company rejected the same on the ground that the Tribunal did not assign any reason for granting permission and that therefore, it should be taken that no permission was granted. This reasoning of the High Court was reversed by the aforesaid Judgment of the Honourable Apex Court and in my view, the judgment is in favour of the first respondent herein. It has been held therein that the order granting permission was not set aside and no challenge was made by the accident victim. In this case, the order of the Tribunal rejecting the application seeking permission to file appeal is not challenged by the Insurance Company and the same is still in force. Since the order of the Tribunal rejecting the application of the Insurance Company u/s 170 of the Motor Vehicles Act is not challenged by the Insurance Company, the Insurance Company could not maintain this appeal on the grounds other than the grounds that are available u/s 149(2)(a) of the Motor Vehicles Act. The appellant is not seeking to question the award on the defences that are available u/s 149(2)(a) of the Motor Vehicles Act. In such circumstances, I find considerable force in the submissions made by the learned Counsel for the first respondent, particularly, in view of the three Judges Bench Judgment of the Supreme Court referred to above. For the foregoing reasons, the appeal fails and the same deserves to be dismissed.
In the result, the Civil Miscellaneous Appeal is dismissed.
Consequently, connected miscellaneous petition is dismissed. No costs.