Court No. - 33
Case :- FIRST APPEAL FROM ORDER No. - 535 of 1989 Appellant :- Sushila Devi And Others Respondent :- Guru Deo Singh And Another Counsel for Appellant :- R.K. Porwal Counsel for Respondent :- A.B.Saran,Nagendra Kumar Srivastava
Hon'ble Dr. Kaushal Jayendra Thaker,J.
1. Heard Shri R.K. Porwal, learned counsel for the appellant, none present for the owner, Shri N.K. Srivastava, learned counsel for United India Insurance Company Limited-respondent.
2. The appeal of appellant challenges the award dated 04.03.1989 passed by Vth Additional District Judge, Motor Accident Claims Tribunal, Etah granting a sum of Rs.1,15,000/- with 12% rate of interest for the death of the sole bread winner. The heirs of the deceased had filed the claim petition wherein the insurance company was exonerated by the tribunal, as it was held that there was breach of the policy condition.
3. The owner had filed appeal challenging the judgment whereby he had disputed the fact that he had permitted the deceased to travel in the vehicle owned by him and he has not committed any breach of policy condition. The Advocate for the appellant was elevated and, thereafter, he did not engage any advocate and First Appeal From Order No. 521 of 1989 came to be dismissed for default recently.
4. Shri R.K. Porwal, Advocate for the claimant has submitted that if this Court does not hold that there was no breach of policy condition and confirms the judgment of the Tribunal then in that case as per judgment of the Supreme Court in the case of Manuara Khatun and others versus Rajesh Kumar Singh and others, (2017) 4SCC 796 the amount be directed to be deposited by the insurance company and recovery rights may be given to the insurance company with submission has been vehemently objected by Shri N.K. Srivastava, learned counsel for the respondents holding that the insurance company cannot be made to deposit the amount.
5. The counsel for respondent has submitted that once the Tribunal has held that liability is of the owner and if appeal preferred by owner is dismissed for default, the insurance company cannot now be saddled with the liability of pay and recover, the additional amount according to Shri N.K. Srivastava, Advocate will also have to be recovered from the owner.
6. The deceased was 34 years of age, he was a Government servant, nothing has been paid under the head of the future loss of income. It is submitted by Shri N.K. Srivastava, Advocate that in those days nothing had to be considered for future loss of income. I am unable to accept the same. The income of deceased who was a Sepoy in Police force was Rs.1200/- per month. The tribunal granted multiplier of 15 deducted Rs.600/- from income and granted multiplier of 16 that is how granted a sum of Rs.1,15,200/- did not grant any amount under other heads and granted 12% interest on the amount.
7. The amount will have to be recalculated namely the income of the deceased was Rs.1200/- per month to which 50% will have to be added as per the judgment of National Insurance Company Limited Vs. Pranay Setthi and others, S.L.P. (Civil) No. 25590 of 2014, decided on 31.10.2017 and Sarla Verma Vs. Delhi Transport Corporation, (2009) 6 SCC 121, as he was below the age of 50 years, hence Rs.1200/- + Rs.600/- which is equal to Rs.1800/- this amount will have to be deducted by 1/3, which would bring the multiplicand to Rs.1200/- multiplied by 16 as he was 34 years of age hence 1200 x 12 x 16= 2,30,400/- and Rs.30,000/- under the head of non pecuniary damages will have to awarded. The amount would be Rs.2,60,000/-.
Liability
8. While going through the record of this Court, it is clear from the oral testimony that the vehicle in which the deceased was travelling was comprehensively insured a sum of Rs.240/- was paid for authorised non fare paying passenger in addition to third party risk of Rs.45/- which means that the insurance company had accepted its liability over and above the statutory liability. The accident did not occur because the deceased was with his goods. This Court while dealing with similar situation the driver of the truck was trying to save a person the truck driver was not negligent the deceased tried to jumped out of the truck the deceased was with his goods and, therefore, the tribunal after holding that if a person was with his goods the insurance company would be liable in this case it is nobody's case that the owner permitted the driver to carry the deceased with the findings was non fare paying passenger then the insurance company will have to be liable the policy condition permitted a non fare paying passenger would be carried in the truck in that view of the matter let us visualise the findings of the Tribunal holding that there was a breach of policy condition goes to the root of the matter. Findings of the fact of tribunal are that there was a breach of policy condition as that the driver had taken as non paying passenger this goes to the root of the matter, it has not been proved by the insurance company that the owner permitted the driver to take such passenger for hire or reward. The deceased was a person with his own goods when the accident occurred. The accident did not occur due to breach of any policy condition. The judgment of this Court in First Appeal From Order No. 7 of 2001, Nish Kant Srivastava versus Smt. Anjoo Devi and others, decided on 28.02.2019 wherein Paragarphs 5 and 6 are as follows:-
"5. The Tribunal has relied on the evidence of the said witness. If we go through the record, it will be very clear that the Insurance company has not produced any witness to show that the deceased was plying in the Jeep not as a paid passenger. The deceased was a relative of the owner and that is how he was in the said vehicle. The owner has deposed on oath that the driver of tractor was driving the tractor in rash and negligent manner and that is how he dashed with the Jeep. The driver Tufail Ahmad and Ram Deo died in the said accident. The Tribunal held both the drivers of the vehicle as co-authors of the accident. The Insurance company though has taken this defence, it is a matter of record that they have paid owner the OD claim which shows that there was no breach of policy conditions, then only the OD of claim could have been allowed. The Insurance company has not proved that it was used as a passenger vehicle. The vehicle was being used as a private vehicle. However, the Tribunal is misleading the evidence of Rahmat Ullah stated that along with a driver, there was a Khalasi. Just because there was a Khalasi, it cannot be said that it was used for the purposes other than private. Assuming for the moment that it was used for plying passenger, the principles for avoiding the policy would be based on the theory of fundamental breach of policy and it was on the Insurance company to prove this fact, which was not proved rather it has been submitted by and demonstrated by the owner that the vehicle was not used for hire and reward. In that view of the matter, in view of the decision of National Insurance Company Limited Vs. Swarn Singh and others, 2004 (1) TAC 321, can it be said that the vehicle was plied in contravention of the policy conditions and that there was fundamental breach of policy as held by the Tribunal.
"CONCLUSION:
It is, therefore, evident from the discussions made hereinbefore that the liability of the insurance company to satisfy the decree at the first instance and to recover the awarded amount from the owner or driver thereof has been holding the field for a long time.
Apart from the reasons stated hereinbefore the doctrine of stare decisis persuades us not to deviate from the said principle.
It is well-settled rule of law and should not ordinarily be deviated from. (See The Bengal Immunity Company Limited Vs. the State of Bihar and Others [1955] 2 SCR 603 at 630-632, Keshav Mills Co. Ltd. Vs. Commissioner of Income-Tax, Bombay North [1965] 2 SCR 908 at 921- 922, Union of India & Anr. Vs. Raghubir Singh (Dead) By LRs. etc. [1989] 3 SCR 316 at 323, 327, 334, M/s. Gannon Dunkerley and Co. and Others Vs. State of Rajasthan and Others (1993) 1 SCC 364, Belgaum Gardeners Cooperative Production Supply and Sale Society Ltd. Vs. State of Karanataka 1993 Supp (1) SCC 96, Hanumantappa Krishnappa Mantur and Others Vs. State of Karnataka [1992 Supp (2) SCC 213].
We may, however, hasten to add that the Tribunal and the court must, however, exercise their jurisdiction to issue such a direction upon consideration of the facts and circumstances of each case and in the event such a direction has been issued despite arriving at a finding of fact to the effect that the insurer has been able to establish that the insured has committed a breach of contract of insurance as envisaged under sub-clause (ii) of clause (a) of sub-section (2) of Section 149 of the Act, the insurance company shall be entitled to realise the awarded amount from the owner or driver of the vehicle, as the case may be, in execution of the same award having regard to the provisions of Sections 165 and 168 of the Act . However, in the event, having regard to the limited scope of inquiry in the proceedings before the Tribunal it had not been able to do so, the insurance company may initiate a separate action therefor against the owner or the driver of the vehicle or both, as the case may be. Those exceptional cases may arise when the evidence becomes available to or comes to the notice of the insurer at a subsequent stage or for one reason or the other, the insurer was not given opportunity to defend at all. Such a course of action may also be resorted when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage.
Although, as noticed hereinbefore, there are certain special leave petitions wherein the persons having the vehicles at the time when the accidents took place did not hold any licence at all, in the facts and circumstances of the case, we do not intend to set aside the said awards. Such awards may also be satisfied by the petitioners herein subject to their right to recover the same from the owners of the vehicles in the manner laid down therein. But this order may not be considered as a precedent.
Although in most of the case, we have not issued notices in view of the fact that the question of law has to be determined; we have heard counsel for the parties at length at this stage.
SUMMARY OF FINDINGS :
The summary of our findings to the various issues as raised in these petitions are as follows:
(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.
(ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163 A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)(ii) of the said Act.
(iii) The breach of policy condition e.g., disqualification of driver or invalid driving licence of the driver, as contained in sub-section (2)(a) (ii) of section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time.
(iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof wherefor would be on them.
(v) The court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case.
(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/ are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under section 149(2) of the Act.
(vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver, (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case.
(viii) If a vehicle at the time of accident was driven by a person having a learner's licence, the insurance companies would be liable to satisfy the decree.
(ix) The claims tribunal constituted under Section 165 read with Section 168 is empowered to adjudicate all claims in respect of the accidents involving death or of bodily injury or damage to property of third party arising in use of motor vehicle. The said power of the tribunal is not restricted to decide the claims inter se between claimant or claimants on one side and insured, insurer and driver on the other. In the course of adjudicating the claim for compensation and to decide the availability of defence or defences to the insurer, the Tribunal has necessarily the power and jurisdiction to decide disputes inter se between insurer and the insured. The decision rendered on the claims and disputes inter se between the insurer and insured in the course of adjudication of claim for compensation by the claimants and the award made thereon is enforceable and executable in the same manner as provided in Section 174 of the Act for enforcement and execution of the award in favour of the claimants.
(x) Where on adjudication of the claim under the Act the tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of section 149(2) read with sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third party under the award of the tribunal. Such determination of claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the tribunal.
(xi) The provisions contained in sub-section (4) with proviso thereunder and sub-section (5) which are intended to cover specified contingencies mentioned therein to enable the insurer to recover amount paid under the contract of insurance on behalf of the insured can be taken recourse of by the Tribunal and be extended to claims and defences of insurer against insured by relegating them to the remedy before regular court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims."
6. In this view of the matter, the vehicle was not being plied in breach of any policy conditions. The avoidance clause cannot be invoked so as to avoid any liability. If it was a package policy as in our case, the Insurance company would be held liable. The said issue is now covered by the decision 2012 ACJ 326. In our case, it is not proved that the deceased was a fare paying passenger. Thus, the Insurance company would be liable. This takes this Court to the next ground raised on compensation. An appeal is always in continuation of the litigation. As far as the deceased is concerned, it was a case of composite negligence hence deduction of 50% from the awarded amount is bad in the eyes of law. In Manuara Khatun and others Vs. Rajesh Kumar Singh and others, AIR 2017 SC 1204, the liability would be that of both the tortfeasors. One of the tortfeasors can be sued and he may be directed to recover from the other tortfeasors but he cannot be exonerated and there cannot be apportionment of the awarded amount. I am supported in my view by the judgment passed by the Apex Court in Khenyei Vs. New India Assurance Company Limited & Others, 2015 LawSuit (SC) 469, wherein the Apex Court has held as under:
4. It is a case of composite negligence where injuries have been caused to the claimants by combined wrongful act of joint tort feasors. In a case of accident caused by negligence of joint tort feasors, all the persons who aid or counsel or direct or join in committal of a wrongful act, are liable. In such case, the liability is always joint and several. The extent of negligence of joint tort feasors in such a case is immaterial for satisfaction of the claim of the plaintiff/claimant and need not be determined by the by the court. However, in case all the joint tort feasors are before the court, it may determine the extent of their liability for the purpose of adjusting inter- se equities between them at appropriate stage. The liability of each and every joint tort feasor vis a vis to plaintiff/claimant cannot be bifurcated as it is joint and several liability. In the case of composite negligence, apportionment of compensation between tort feasors for making payment to the plaintiff is not permissible as the plaintiff/claimant has the right to recover the entire amount from the easiest targets/solvent defendant.
14. There is a difference between contributory and composite negligence. In the case of contributory negligence, a person who has himself contributed to the extent cannot claim compensation for the injuries sustained by him in the accident to the extent of his own negligence;whereas in the case of composite negligence, a person who has suffered has not contributed to the accident but the outcome of combination of negligence of two or more other persons. This Court in T.O. Anthony v. Karvarnan & Ors. [2008 (3) SCC 748] has held that in case of contributory negligence, injured need not establish the extent of responsibility of each wrong doer separately, nor is it necessary for the court to determine the extent of liability of each wrong doer separately. It is only in the case of contributory negligence that the injured himself has contributed by his negligence in the accident. Extent of his negligence is required to be determined as damages recoverable by him in respect of the injuries have to be reduced in proportion to his contributory negligence. The relevant portion is extracted hereunder:
"6. 'Composite negligence' refers to the negligence on the part of two or more persons. Where a person is injured as a result of negligence on the part of two or more wrong doers, it is said that the person was injured on account of the composite negligence of those wrong-doers. In such a case, each wrong doer, is jointly and severally liable to the injured for payment of the entire damages and the injured person has the choice of proceeding against all or any of them. In such a case, the injured need not establish the extent of responsibility of each wrong-doer separately, nor is it necessary for the court to determine the extent of liability of each wrong-doer separately. On the other hand where a person suffers injury, partly due to the negligence on the part of another person or persons, and partly as a result of his own negligence, then the negligence of the part of the injured which contributed to the accident is referred to as his contributory negligence. Where the injured is guilty of some negligence, his claim for damages is not defeated merely by reason of the negligence on his part but the damages recoverable by him in respect of the injuries stands reduced in proportion to his contributory negligence."
9. In that view of the matter the judgment in Swarn Singh case (supra) will come to the aid of the appellant herein, hence the entire amount will have to be paid by the Insurance Company. I have perused the witnesses statements and memo of appeal of the owner wherein in the memo of appeal preferred by the owner it is averred in the appeal of owner also that the owner had not given any permission to his driver to carry any passenger however even if the converse is considered the insurance company having taken additional premium for passenger they cannot avoid the liability. In view of this, it cannot be said that there was breach of policy condition. The deceased was the owner of the goods and was with his goods. Insurance Company will be liable to pay the amount of compensation fixed herein above with interest.
Interest
10. The rate of interest will have to be 9% from the date of filing of the claim petiton till judgment of the tribunal and 6% thereafter. In view of the judgment of the Division Bench of Lucknow Bench in F.A.F.O. No. 199 of 2017 (National Insurance Company Limited Vs. Lavkush and another) decided on 21.3.2017 which has been followed by this Court time and again and which will enure for the benefit of the appellant. However, I am in agreement with counsel for the respondent that after the appeal is filed and is kept pending, the rate of interest requires to be decreased.
11. No other grounds are urged orally when the matter was heard.
12. In view of the above, the appellants shall be entitled to a sum of Rs.2,60,000/- with interest as hereinabove claimable from all the respondents jointly and severally. Judgment and decree passed by the Tribunal shall stand modified to the aforesaid extent. The amount be recalculated and deposited with interest at the rate of 9% from the date of filing of the claim petition till award and 6% thereafter till the amount is deposited. The amount be deposited within a period of 12 weeks from today. The amount already deposited be deducted from the amount to be deposited.
13. The appeal is partly allowed.
14. This court is thankful to both the counsels to see that this very old matter is disposed of.
Order Date :- 21.8.2019 A.N. Mishra