Court No. - 26
Case :- FIRST APPEAL FROM ORDER No.623 of 1998 Appellant :- United India Insurance Co. Ltd. Respondent :- Sikhanti And Others Counsel for Appellant :- Amresh Sinha Counsel for Respondent :- Vivekanand Yadav
Hon'ble Dr. Kaushal Jayendra Thaker, J.
1. Heard Sri Amresh Sinha for the appellant and Sri Vivekanand Yadav for the respondents.
2. By means of this appeal, the appellant challenges the judgment and award dated 16.3.1998 passed by Motor Accident Claims Tribunal, Deoria, in M.A.C.P. No.372 of 1995 (Sikhanti Vs. Smt. Gauri Devi).
3. This appeal is preferred on the following grounds namely that :-
“(i) The award passed solely against the insurer is nullity in the eye of law as the insurer only indemnifies the insured.
(ii) On the date of accident (9.11.1995), the driver Amarnath had no driving licence as the same expired on 29.3.1995 and the Tribunal by misreading the same, illegally held that the driver had valid driving licence on the date of accident.
(iii) The driving licence was originally issued on 13.11.1986 and thereafter it was lastly renewed on 30.3.1992 for three years upto 29.3.1995 and, as such, the driver had no driving licence on the date of accident.
(iv) The income of the deceased of Rs.3,875/- is not proved as PW-3 Matichand had stated that the deceased was getting only Rs.2,720/-.
(v) The Tribunal had committed illegality in taking the dependency of two minor sons for the whole period as the age of the reasondent nos. 2 and 3 was 14 and 10 years respectively on the date of filing the claim petition.
(vi) No interest on the future amount of dependency can be awarded.
(vii) The Tribunal had applied the high multiplier of 16, when the age of the deceased Kanta was not proved.
(viii) The compensation has been awarded by applying wrong principles of law and is based on surmises and conjectures.
(ix) The award of the Tribunal is against the evidence on record, based on surmises and conjectures and against the provisions of law applicable thereto.”
4. The first ground raised is not germane for our purpose as the Tribunal has held that the vehicle was insured with the appellant and just because in the order, it is not mentioned that the owner will be liable, will not vitiated the judgment. The driver of the said vehicle has held negligent. On the date of the accident, the vehicle of opponent no.1 was insured with the appellant and, therefore, once it is held that the vehicle was insured, the decree is to be satisfied by the Insurance under Section 149 of the Motor Vehicles Act, hence the said ground fails.
5. The next ground is that on the date of the accident i.e. 9.11.1999, the driver Amar Nath had no driving licence as his licence had expired on 29.3.1995 and the Tribunal misread the factual aspect and further the Tribunal seems to have held against the Insurance company that the Tribunal has given a finding that on the date of the accident the driver Amar Nath had proper driving licence and the Tribunal came to this finding of fact that nothing was proved on record to show that the driver had driven the vehicle without proper driving licence. The licence of driver of the jeep was already on record. The witness DW1 shows that the owner Gauri Devi has filed the driving licence and the said licence was effective on the date of the accident. Though evidence was led or it was not even proved nor any ground taken that the vehicle was handed over by the owner to a person, who did not have proper and valid driving licence. This having not been proved, the Insurance company cannot now succeed and cannot be absolved of its liabilities. The Insurance company has not proved that there is any breach of policy conditions. It is duty of the Insurance company to prove that there was breach of policy.
6. It is submitted by learned counsel for the appellant that as regards the second ground is concerned namely compensation granted to the heirs, it is submitted that multiplier is on the higher side. It is further submitted that the amount granted requires to be slashed. It is submitted that the interest could not have been granted. The interest @ 12% even in the year 1998 could not have been given.
7. That in that view of the matter and 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 and the judgment of the Tribunal requires to be upturned. The Apex Court in Swaran Singh (supra) has held as under:
“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.”
8. In that the view of the matter, it cannot be said that there is any fundamental breach of policy.
9. The compensation granted cannot be said to be so exorbitant which would required interference. The Tribunal has not granted any amount under the head of future loss of income though the deceased was entitled to the same.
10. The submission that interest could not have been more than 7% is partly accepted and the interest would be 9 per cent on the awarded amount. However, 3% additional amount of interest would make good for the amount not paid to the claimant. Hence, there shall be no recovery.
11. The appeal is partly allowed. However, the quantum shall remain the same.
Order Date :- 28.2.2019 Irshad