Allowed

U.P.S.R.T.C. Azamgarh v. Smt. Kalpana Devi and Others

Allahabad HC8 May 2019FAFO/2953/2011

Case brief

AI extract

What is this about?

In this motor accident appeal, the court reversed the Tribunal's decision to exonerate the insurer from liability. Holding that the insurer remained liable despite the vehicle being under the Corporation's control, the court restored the award and declared all parties jointly and severally liable.

What did the court decide?

Impugned award affirmed; compensation of Rs.19,58,225 with interest payable jointly and severally by claims respondents against all three parties.

U.P.S.R.T.C. Azamgarh Vs Smt. Kalpana Devi and Others — Motor Accident Claims | Allahabad HC (2019)

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A.F.R.

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Court No. - 40

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Case :- FIRST APPEAL FROM ORDER No. - 2953 of 2011

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Appellant :- U.P.S.R.T.C. Azamgarh Respondent :- Smt. Kalpana Devi And Others Counsel for Appellant :- Ajit Kumar Singh Counsel for Respondent :- Ranjeet Asthana,Anand Kumar Srivastava,Vipul Kumar

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Hon'ble Harsh Kumar,J.

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The present first appeal from order has been filed by appellant against impugned judgment and award dated 27.05.2011 passed by Motor Accident Claims Tribunal/ Additional District & Sessions Judge, Court No.1, Azamgarh (hereinafter referred to as 'Tribunal') in Motor Accident Claim Petition No.286 of 2000 (Smt. Kalpana Devi & Others vs. Mohd. Sagir Ansari & Others) awarding a compensation of Rs.19,58,225/- with interest @ 7% per annum to claimantsrespondent nos.1 to 4 against opposite party nos.1 and 3 i.e., appellants and respondent no.5 and dismissing claim petition against opposite party no.2 i.e., United India Insurance Company Ltd respondent no.6.

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The brief facts relating to the case are that Claim Petition No.286 of 2000 was filed by claimants-respondents nos.1 to 4 Smt. Kalpana Devi and others seeking compensation of Rs.70,20,000/- on death of Mahendra Kumar due to rash and negligent driving of mini bus bearing registration no.UP65/H8894 (hereinafter referred as 'offending vehicle') on 1.10.2000 at 7.30 p.m. which was being driven by a duly licensed driver and was being plied under control of U.P.S.R.T.C. (hereinafter referred to as ‘Corporation’) and was duly insured with United India Insurance Company Ltd at the time of accident.

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After recording evidence and hearing parties counsel, Tribunal awarded a sum of Rs.19,58,225/- as compensation to claimants-respondents and exonerating insurance company from its liability passed award against owner of offending vehicle and Corporation Feeling aggrieved, Corporation has preferred this appeal.

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Heard Shri Himanshu Mishra and Shri Sashi Prakash Rai learned counsel for appellant, Shri Vipul Kumar learned counsel for respondent no.6, United India Insurance Company Ltd., and Shri Anand Kumar Srivastava learned counsel for claimants-respondents no.1 to 4.

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Learned counsel for appellant contended that learned Tribunal has acted wrongly and illegally in exonerating insurance company, respondent no.6 from its liability to indemnify the owner of offending vehicle in question on two grounds viz., (i) that offending vehicle was being plied under control of appellant, Corporation and even conductor over the bus was also of U.P.S.R.T.C. and (ii) the route permit for plying vehicle on Azamgarh – Varanasi route was not filed; that by plying of offending vehicle under control of Corporation, the contract of insurance between owner and insurer of vehicle does not ceases to exist; that the offending vehicle was being plied on Azamgarh – Varanasi route which is duly notified for plying buses by Corporation and no separate permit was required for plying of offending vehicle in question under control of Corporation.

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Per contra learned counsel for respondent no.6, United India Insurance Company Ltd., supported the impugned judgment and award and contended that learned Tribunal has given a reasoned finding on issue no.2 in holding that privity of contract was there between owner and insurer of offending vehicle, and there was no privity of contract between Corporation and insurance company; that the view taken by

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Tribunal is fully supported by the pronouncement of Apex Court in the case of Rajasthan State Road Transport Corporation v. Kailash Nath Kothari and others, (1997) 7 SCC 481 where liability for payment of compensation was fastened on Corporation as at the time of accident, the offending vehicle i.e., Mini bus was being run by it under the control; that Corporation failed to produce any route permit of the offending vehicle for plying it on Azamgarh – Varanasi route and so the Tribunal has rightly held that it is not proved from the evidence on record that Corporation was holding a valid permit to ply the offending vehicle at the place of accident; that Tribunal has rightly exonerated insurance company from its liability for payment of compensation as in the case of Amrit Paul Singh vs. Tata Aig General Insurance Company, (2018) 7 SCC 558 also the Apex Court holding that use of vehicle in public place without a permit is a fundamental statutory infraction, given right of recovery to insurer against owner of vehicle.

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Upon hearing parties counsel & perusal of record, I find that ground no.1 involving exoneration of insurer on account of fact that bus was under control of Corporation is no more res-integra and it stands settled by judgment of Apex Court in the case of U.P.State Road Transport Corporation Vs.

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Kulsum and others, 2011 (8) SCC 142, observations made in paras 29, 36 and 37 of which are as under :-

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“29. Critical examination thereof would show that the Appellant and the owner had specifically agreed that the vehicle will be insured and a driver would be provided by owner of the vehicle but overall control, not only on the vehicle but also on the driver, would be that of the Corporation. Thus, the vehicle was given on hire by the owner of the vehicle together with its existing and running insurance policy. In view of the aforesaid terms and conditions, the Insurance Company cannot escape its liability to pay the amount of compensation. There is no denial of the fact by the

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insurance company that at the relevant point of time the vehicle in question was insured with it and the policy was very much in force and in existence. It is also not the case of the insurance company that the driver of the vehicle was not holding a valid driving licence to drive the vehicle. The Tribunal has also held that the driver had a valid driving licence C.A. @ SLP(C)No.1969 of 2008 etc. ...(contd.) at the time of accident. It has also not been contended by it that there has been violation of the terms and conditions of the policy or that the driver was not entitled to drive the said vehicle.

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36. Thus, for all practical purposes, for the relevant period, the Corporation had become the owner of the vehicle for the specific period. If the Corporation had become the owner even for the specific period and the vehicle having been insured at the instance of original owner, it will be deemed that the vehicle was transferred along with the Insurance Policy in existence to the Corporation and thus Insurance Company would not be able to escape its liability to pay the amount of compensation.

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37. The liability to pay compensation is based on a statutory provision. Compulsory Insurance of the vehicle is meant for the benefit of the Third Parties. The liability of the owner to have compulsory insurance is only in regard to Third Party and not to the property.

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Once the vehicle is insured, the owner as well as any other person can use the vehicle with the consent of the C.A. @ SLP(C)No.1969 of 2008 etc. ...(contd.) owner. Section 146 of the Act does not provide that any person who uses the vehicle independently, a separate Insurance Policy should be taken. The purpose of compulsory insurance in the Act has been enacted with an object to advance social justice. “

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The above view has been followed in recent decision of Apex Court in the case of U.P.State Road Transport Corporation Vs. National Insurance Company Ltd., 2019 ACJ 269 SC.

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As far as 2^nd ground with regard to permit of bus is concerned I find force in the arguments advanced by counsel

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for Corporation that mini bus owned by respondent no.4 was being plied under control of Corporation on route duly notified for plying of Corporation buses, on which no separate permit was required for plying of private vehicles under control of Corporation. There is no case of insurer the Azamgarh – Varanasi route was not notified for plying of buses by Corporation and moreover no suggestion was put to OPW1 the witness of Corporation that bus was being plied without permit and no other evidence was produced by insurer. In absence of any such plea or evidence on record neither the Corporation was supposed to ply bus without route permit nor may be presumed to be plying so and appears to be fully authorized to ply the offending bus under its control on the route notified for Corporation buses.

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In the case of Amrit Paul Singh vs. Tata Aig General Insurance Company, (2018) 7 SCC 558, there was an accident between the offending transport vehicle truck and motorcycle of deceased on 19.2.2013 and the truck was neither registered nor had a route permit, which were issued subsequently on 26.2.2013 and 27.2.2013 respectively, after about one week of accident, so holding it a case of a fundamental statutory infraction insurer was exonerated. In the case in hand offending mini bus in question was being plied on route approved for Corporation, in view of different facts the case of Amrit Paul is not applicable to the facts of this case.

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In view of discussions made above, I have come to the conclusion that findings of learned Tribunal on issue nos.2 and 5 ‘that since bus was being plied under the control of Corporation and for want of permit insurance company was not liable for payment of compensation’ are erroneous and are liable to be set aside and appeal is liable to be allowed.

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The appeal is allowed, the impugned award is affirmed with regard to quantum of compensation & is modified in the manner that claim petition stands allowed for grant of compensation of Rs.19,58,225/- with simple interest @ 7% per annum to claimants-respondents no.1 to 4 against all the three respondents who shall be jointly and severally liable for payment of compensation and the amount of compensation will be deposited by insurance company with the Tribunal within two months from today or may be paid to Corporation. If appellant Corporation has already deposited any amount of compensation with Tribunal in compliance of interim order dated 30.8.2011, in this appeal it will have right to recover the same from owner or insurer of offending vehicle.

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Let lower court record be sent back to court below along with a copy of this order for ascertaining necessary compliance. Order Date :- 8.5.2019 VS

U.P.S.R.T.C. Azamgarh v. Smt. Kalpana Devi and Others

Case brief

What is this about?

What did the court decide?

U.P.S.R.T.C. Azamgarh v. Smt. Kalpana Devi and Others

Case brief

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What did the court decide?

What the court decided

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