IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 4TH DAY OF DECEMBER, 2019 BEFORE THE HON'BLE MR. JUSTICE B M SHYAM PRASAD M.F.A. NO.2457 OF 2010 (M.V.) c/w M.F.A.No.7659 OF 2010 IN M.F.A.No.2457/2010 Between:
T.N. Ramaiah S/o. Late T.K.Nagappa Resident of M.G.Road Tarikere Since dead, represented by his LRs Smt. T.R.Sarojamma W/o. Dr.H.Srinivas Aged about 66 years Co. T.N.R. Rice Mill Industries Tarikere Represented by authorized GPA holder S.Rajesh W/o Dr.H.Srinivas Aged about 36 years C/o T.N.R. Rice Mill Industries Tarikere (By Sri. Chethan B, Advocate) ... Appellant And:
1. Hanumanthappa S/o. Krishnappa Aged about 19 years Resident of Gadirangapur Village Shivani Hobli Tarikere Taluk 2. Kollabovi S/o. Sannakellabovi Aged about 37 years Car driver Resident of Bhavikere Tarikere Taluk 3. The Divisional Manager The United India Insurance Co. Ltd Divisional Office B.H.Road Shimoga 4. K.B.Naveen S/o. Basavarajappa Aged about 38 years D.C.C.Bank Employee Birur Post, Kadur Taluk Chikmangalore ... Respondents (By Sri. Manjunath G Khadekar, Advocate for R1; Sri. O.Mahesh, Advocate for R3;
Sri. Vasantha Kumar Bardila, Advocate for R4 Notice to R2 served) IN M.F.A.No.7659 OF 2010 BETWEEN K.B.Naveen S/o. Basavarajappa Aged about 46 years D.C.C.Bank Employee Birur Post, Kadur Taluk Chikmagalur Appellant (By Sri. Vasantha Kumar Bardila, Advocate) AND 1. Hanumanthappa S/o. Krishnappa Aged about 31 years Resident of Gadirangapur Village Shivani Hobli Tarikere Taluk 2. Kollabovi S/o. Sannakellabovi Aged about 37 years Car driver bearing No.KA-18/M1155 Resident of Bhavikere Tarikere Taluk T.N.Ramaiah Since dead, is represented by his LR 3. Smt. T.R.Sarojamma W/o. Dr.H.Srinivas T.N.R. Rice Mill Industries Tarikere 4. The Divisional Manager The United India Insurance Company Limited B.H.Road, Shimoga ... Respondents (By Sri. Manjunath G Khadekar, Advocate for R1; Sri. Chetan B, Advocate for R3;
Sri. O.Mahesh, Advocate for R4; Notice to R2 served) These Miscellaneous First Appeals are filed under Section 173(1) of MV Act against the judgment and award dated 15.12.2009 passed in MVC.No.78/1997 on the file of the Civil Judge (Sr.Dn) and MACT, Tarikere, awarding a compensation of Rs.92,321/- with interest at 6% per annum from the date of petition till deposit.
These Miscellaneous First Appeals coming on for admission this day, the Court delivered the following J U D G M E N T This appeal in M.F.A.No.2457/2010 is filed by the owner of car bearing registration No.KA-18M-1155 calling in question the judgment and award dated 15.12.2009 in M.V.C.No.78/1997 on the file of the Civil Judge (Sr.Dn.) and MACT, Tarikere (for short ‘the Tribunal’). The other appeal in M.F.A.No.7659/2010 is filed by an Authorized Agent of M/s. United India Insurance Company Limited.
2. The claimant, Sri. Hanumanthappa, suffered injuries in a road accident on 09.05.1997 at about 6:00 p.m., when the car bearing registration No. KA-18M-1155 (for short ‘the offending vehicle’) dashed against him. He suffered injuries to his right foot, which necessitated surgical procedure. The Tribunal has granted to the claimant a total sum of Rs.92,321/- as compensation along with interest at the rate of 6% per annum from the date of petition till the date of deposit. The claimant is not seeking enhancement, and the appeals are because the legal representative of the deceased owner of the offending vehicle (along with the driver) and the Authorized Agent of the Insurance Company, M/s. United India Insurance Company Limited, are made jointly and severally liable to pay compensation while the Insurance Company is absolved of the liability.
3. The owner of the offending vehicle as of the date of the accident, Sri. T.N.Ramaiah, died during the pendency of the Claim Petition, and his daughter is brought on record as a respondent. Insofar as the deceased owner’s liability, the defense is that the deceased owner made over the cheque on 08.05.1997 bearing No.840206 drawn on the State Bank of Mysuru, Tarikere Branch to an Authorized Agent of the Insurance Company (the appellant in the appeal in M.F.A.No.7659/2010) for renewal of the policy that was to lapse in the midnight of 08.05.1997. As on the date the cheque was made over, the deceased had sufficient balance in his account. The Cheque dated 08.05.1997 is also encashed by the Insurance Company, but no policy is issued. As such, the Insurance Company should be held liable to pay the compensation, if any, to the claimant. The Insurance Company filed its own objection statement denying the accident, the nature of injury and the quantum of compensation claimed. However, the Insurance Company did not take any specific defence as against the encashment of the cheque or the issuance of the policy. The Authorized Agent of the Insurance Company has filed his objection statement essentially asserting that the deceased owner of the offending vehicle handed over the Cheque dated 08.05.1997 only on 12.5.1997 i.e., after the date of accident viz., 9.5.1997.
4. The Tribunal on appreciation of the evidence on record has concluded that the deceased owner of the offending vehicle handed over the cheque for renewal of the policy on 08.05.1997 to the Authorized Agent (the appellant in MFA No.7659/2010), but he was negligent in not depositing the Cheque issued by the deceased owner with the Insurance Company. Therefore, the Insurance Company would not be liable, and the driver and the owner of the offending vehicle along with the agent of the Insurance company would be jointly and severally liable to pay compensation as awarded.
5. The learned counsel for the legal representative of the deceased owner of the offending vehicle submits that the Tribunal could not have absolved the Insurance Company of the liability after having found that the Insurance Company’s agent viz., the appellant in MFA No.7659/2010 was negligent in making over to the Insurance Company the cheque issued by the deceased owner before expiry of the policy and the date of the accident.
6. The learned counsel for the Authorized Agent submits that the evidence on record to establish that the Cheque though dated 08.05.1997 for payment of premium was made over to the Authorised Agent only on 12.05.1997 (after the expiry of the then extant policy), and on the same day, he deposited the cheque with the Insurance Company and also handed over the policy and the receipts for the payment of premium to the deceased. The Authorized Agent only discharged his contractual obligation with the Insurance Company in receiving the Cheque dated 08.05.1997 for the renewal of the policy from the deceased owner of the offending vehicle and transmitting it to the Insurance Company. As such, the Authorized Agent could not have been made personally liable to pay compensation.
7. The learned counsel for the Insurance Company submits that the Tribunal is justified in fastening the liability to pay compensation on the deceased owner of the offending vehicle/his legal representative because the offending vehicle was not insured as on the date of the accident and the case that the premium for renewal of the policy was paid prior to lapse of the extant policy and the accident, cannot be accepted for different reasons. Firstly, the legal representative of the deceased owner who contends that premium was paid, does not mention the details of the policy, and in fact, the claim petition also does not mention the details of the policy. Secondly, the Insurance Company has not issued any policy, and therefore, there is no privity of contract between the Insurer and the deceased owner of the offending vehicle as of the date of the accident. Thirdly, the Cheque dated 8.5.1997, which is marked as Ex.R.2, establishes that it was presented for encashment only on 19.5.1997 that is after expiry of the policy and after the accident.
8. In the light of the rival contentions, the dispute in these appeals is inter se the legal representative of the deceased owner and the Insurance Company/ its Authorized Agent, and the question for consideration is:
“Whether, the Tribunal, in the facts and circumstances of the case, is justified in fastening the liability to pay compensation on the driver/owner of the offending vehicle and the Insurance Company’s Authorized Agent absolving the Insurance Company of the liability to pay compensation”.
9. It is undisputed that the policy for the offending vehicle lapsed as of the midnight of 08.05.1997, and the offending vehicle was involved in the accident on 09.05.1997 in which the claimant was injured. There is no dispute that the Insurance Company has received a sum of Rs. 3124/- towards renewal of the policy on 19.05.1997. It is also undisputed by the learned Counsel for the parties that the Insurance Company would be liable to pay compensation to the Claimant if it cannot be reasonably inferred that the Cheque dated 08.05.1997 was handed over by the deceased owner to the Insurance Company via its Authorized Agent after the expiry of the policy and the date of the accident.
10. In support of the defense as aforesaid, the power of attorney of the daughter of the deceased owner is examined as RW1. His evidence is that the deceased made over the Cheque dated 08.05.1997 for a sum of Rs.3124/- to the Authorized Agent on 08.05.1997 towards renewal of the policy. As of that day, the deceased owner of the offending vehicle had sufficient balance in his account. The Cheque dated 08.05.1997 was tendered to the Authorized Agent before the date of expiry of the policy and the date of the accident. The Authorized Agent, despite repeated requests by the deceased owner of the offending vehicle, did not hand over the policy or the receipt for payment of premium. In support of this oral evidence, reliance is placed upon the Cheque dated 08.05.1997 (Ex. R2) summoned from the Bank and the deceased owner’s Bank Statement (Ex. R.3).
11. This witness has been cross examined separately on behalf of the Authorized Agent and the Insurance Company. On behalf of the Authorized Agent, it is suggested that the Cheque dated 08.05.1997 was made over only on 12.05.1997 and the original of the premium receipt and the policy in this regard were issued immediately thereafter and these documents are with the witness. The witness has denied this suggestion. On behalf of the Insurance Company, it is suggested to this witness that a policy is issued to the deceased owner after 08.05.1997 and this policy is deliberately withheld to avoid the truth being placed on record. The witness has denied even these suggestions.
12. The Insurance Company, though did not take a specific defense in its objection statement about the issuance of the policy, while cross – examining RW.1 has taken the specific defense that the policy was issued after the expiry of the extant policy on 08.05.1997. This suggestion assumes greater significance in the light of the evidence of the Authorized Agent, who is categorical in his chief - examination that the Cheque dated 08.05.1997 was made over to him only on 12.05.1997 which he deposited with the Insurance Company on the same day. The Insurance Company on the very same day issued policy as well as receipt for receiving premium, which were handed over to the deceased owner. Thus, the specific defense of the Insurance Company and the Authorized Agent is that the Cheque dated 08.05.1997 was made over on 12.05.1997 and the policy was also issued on that day.
13. It is undeniable, as emphasized by the learned counsel on behalf of the deceased owner, that certain measures for inspection of the vehicle and issuance of policy must have been taken by the Insurance Company/its agents for renewal of the policy as a sum of Rs.3124/- is undisputedly credited to its account. The Authorized Agent has stated that the vehicle was inspected on 12.5.1997. The Bank Statement, Ex.R.3, establishes that a sum of Rs.3124/- was debited to the deceased’s account on 19.05.1997, which must be necessarily after the requisite due process. But the Insurance Company has not placed any material on record from which it can be reasonably inferred that the cheque dated 08.05.1997 for the payment towards renewal of the policy was made over after the date of the accident. In the absence of necessary materials in this regard, in the considered opinion of this court, no mala fides can be reasonably inferred against the deceased owner, and the appropriate reasonable inference could be that the Cheque dated 08.05.1997 was handed over on the said date as asserted on behalf of the deceased owner. As such, the Tribunal is justified in its conclusion that the evidence of the Authorized agent cannot be accepted. However, in the considered opinion of this Court, the failure to establish the defense could only be at the risk of the Insurance Company which undeniably has received the credit for the renewal of the policy but has not offered any explanation to justify its defense. Therefore, it is concluded that the Tribunal has erred in absolving the Insurance Company of its liability and calling upon the legal representative of the deceased owner of the offending vehicle and the Authorized Agent to jointly and severally liable to pay compensation.
For the foregoing, the following order:
a) The appeal in MFA No.2457/2010 and MFA No.7659/2010 are allowed and the impugned judgment and award dated 15.12.2009 in MVC No.78/1997 on the file of the Civil Judge (Sr.Dn.) and MACT, Tarikere is modified holding that the Insurance Company viz., the respondent No.3 in MFA No.2457/2010 and also respondent No.4 in MFA No.7659/2010 is liable to pay compensation along with interest.
b) The Insurance Company shall deposit the compensation with interest within a period of six weeks from the date of receipt of certified copy of this judgment.
c) The amount in deposit be returned to the respective appellants.
The office to draw the decree accordingly.
SD/- JUDGE RB/SA