The Oriental Insurance Company Limited Vs Banjami Linga

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NAFR

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Order reserved on : 15/12/2023

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Order delivered on : 14/02/2024

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HIGH COURT OF CHHATTISGARH, BILASPUR

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MAC No. 677 of 2017

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The Oriental Insurance Company Limited Back Of Hotal Laxman, Krishi Upaj Mandi Marg, Jagdalpur District Bastar, Chhattisgarh ..............Insurance Company, Chhattisgarh

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---- Appellant

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Versus

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Banjami Linga S/o Banjami Joga, Aged About 51 Years R/o Village Keriyarpara, Bhusaras, Tehsil Sukma, District Sukma, Chhattisgarh

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Smt. Bajami Hungi W/o Banjami Linga, Aged About 47 Years R/o Village Keriyarpara, Bhusaras, Tehsil Sukma, District Sukma, Chhattisgarh

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Banjami Hurre S/o Banjami Linga, Aged About 26 Years R/o Village Keriyarpara, Bhusaras, Tehsil Sukma, District Sukma, Chhattisgarh

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Ku. Banjami Bhime D/o Banjami Linga, Aged About 17 Years Minor Through Res.No.1, R/o Village Keriyarpara, Bhusaras, Tehsil Sukma, District Sukma, Chhattisgarh

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Banjami Joga S/o Banjami Linga, Aged About 15 Years Minor Through Res.No.1, R/o Village Keriyarpara, Bhusaras, Tehsil Sukma, District Sukma, Chhattisgarh

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Advin Masih S/o Vijay Masih, Aged About 51 Years R/o Santhalipara, Sukma, Tehsil Sukma, District Sukma, Chhattisgarh ..............Vehicle Driver

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Atul Haldhar S/o Haricharan Haldhar, Aged About 63 Years R/o Near To Forest Naka, Sukma, Tehsil Sukma, District Sukma, Chhattisgarh ................Vehicle Owner

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---- Respondents

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For Appellant : Shri Sudhir Agrawal, Advocate For Respondents 1 to 7 : None, though served.

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Hon'ble Shri Justice Sachin Singh Rajput

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C A V JUDGMENT

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This appeal under Section 173 of Motor Vehicles Act, 1988 (for short ‘the Act of 1988’) has been filed by the appellant / insurance company aggrieved by

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award dated 07/02/2017 passed by the 1^st Additional Motor Accident Claims Tribunal, South Bastar, Dantewada (CG) in claim case No.159/2014. By the impugned award, learned Tribunal has awarded Rs.3,60,000/- in favour of respondents 1 to 5/claimants on account of death of Banjami Handa in an accident that took place on 02/12/2009 by rash and negligent driving of the offending vehicle (Commander Jeep) bearing registration No.CG19-T-0342 by respondent No.6/ driver, owned by respondent No.7/ owner and insured with the appellant / insurance company.

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Facts of the case in brief is that when the deceased – Banjami Handa was engaged in labour work on the road side, at that point of time, respondent No.6 / driver of the offending vehicle drove the vehicle rashly and negligently and dashed the deceased due to which he sustained severe injuries on his head and different parts of the body and he died on the spot. Report was lodged in the police station. As per pleadings of the claim application, on the date of accident i.e. 02/12/2009, the deceased was aged about 23 years, he was earning Rs.4000/- by doing labour work and respondents 1 to 5 were depending on the income of the deceased. Therefore, a total compensation of Rs.14,00,000/- was claimed.

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Respondent No.6 and 7/ driver and owner of the offending vehicle filed written statement and denied averments of the claim application. They pleaded that the offending vehicle was insured with the appellant / insurance company and they are not liable to pay compensation. The appellant / Insurance Company also filed written statement and denied the averments of the claim application. It was pleaded that on the date of accident, the driver of the offending vehicle did not have valid and effective driving license. Therefore, the insurance company is not liable to pay compensation.

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Learned Tribunal after framing issues and assessment of evidence available on record, decided the same in favour of respondents 1 to 5 / claimants and awarded compensation holding the appellant / insurance company liable to pay compensation. Issue No.4 was framed with regard to valid and effective driving license which was found to be proved.

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Learned counsel for the appellant / insurance company argued that the issue No.4 was found proved in favour of respondent No.6 and 7 and the

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insurance company was held liable to pay compensation. He submitted that the driver of the offending vehicle did not have valid and effective driving license. Therefore, there is violation of the terms and conditions of the insurance policy. He further submitted that there was no fitness and permit of the offending vehicle. Hence, the appeal may be allowed and the appellant / insurance company may be exonerated from payment of compensation. Learned counsel placed reliance on the decision of Hon’ble Supreme Court in the case of Amrit Paul Singh and anr. v. Tata AIG General Insurance Co. Ltd. and ors., (2018) 7 SCC 558 and National Insurance Company Ltd. v. Challa Bharathamma and ors, 2004 ACJ 2094.

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Despite service, none appeared on behalf of respondents 1 to 7.

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I have heard learned counsel for the appellant and perused the record.

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The challenge in this appeal is on the ground of valid and effective driving license, permit and fitness.

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The insurance company in its written statement denied averments of the claim application. In the additional pleading, it has been stated that the driver of the offending vehicle was not holding valid and effective driving license, however, they specifically pleaded that the offending vehicle was being driven without valid and effective driving license. Learned Tribunal framed very specific issue with regard to the fact whether the driver of the offending vehicle was holding any valid and effective driving license and it did not frame any issue with regard to violation of the insurance policy on account of absence of valid and effective driving license.

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10.Mithlesh Kumar Mahar (NAW1) was examined on behalf of appellant/insurance company. From perusal of his evidence, it appears that the driver of the offending vehicle–Edvin Masih was having license bearing No.E/595/BTR/18 and details of license is marked as Ex.NA-1. It was valid from 11/02/2005 till 30/02/2016. The license was issued for driving private vehicle and it was not endorsed to drive any other category.

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11.Administrative Officer, Shiv Subramanyam Iyyer (NAW2) was examined also who deposed in his statement that the offending vehicle was insured with the appellant / insurance company vide policy No.153601/31/2010/1335 from

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30/06/2009 to 29/06/2010 in the name of Smt. Misla Laxmi and after transfer of ownership of the offending vehicle, endorsement in the name of owner of the offending vehicle Atul Haldhar was made on 16/07/2009. The insurance policy is exhibited as Ex.NA-2. He further deposed that the policy was issued for transport vehicle and for driving that vehicle, an endorsement is necessary and there has to be valid fitness and permit on the date of accident. He further deposed that on 24/06/2016, a letter was written to the owner Atul Haldhar requesting to produce the permit and fitness of the vehicle, copy of which is marked as Ex.NA-3 and acknowledgment is marked as Ex.NA-4. He further deposed that the driver of the offending vehicle was not holding valid and effective driving license and despite demand of permit and fitness, no such document / papers were submitted to the insurance company hence, there is violation of the insurance policy, therefore, the insurance company is not liable to pay compensation.

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12.Perusal of insurance policy (Ex.NA-2) reflects that the same was issued for carrying passengers. Clause ‘ Limitations as to Use ’ and ‘ Driver’s Clause ’ are reproduced as below -

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“ Limitations as to use

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The policy covers use only under a permit within the meaning of the Motor Vehicle Act 1988 or such a carriage falling under Sub-section 3 of Section 66 of the Motor Vehicles Act, 1988.

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Driver’s Clause

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Any person including insured : Provided that a person driving holds an effective driving license at the time of the accident and is not disqualified from holding or obtaining such a license. Provided also that the person holding an effective Learner’s license may also drive the vehicle when not used for the transport of passengers at the time of accident and that such a person satisfies the requirements of Rule 3 of the Central Motor Vehicles Rules, 1989.”

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13.Ex.NA-3 indicates that a registered AD letter was sent to the owner of the offending vehicle – Atul Haldhar demanding to produce documents of permit and fitness of the offending vehicle and Ex.NA-4 is the acknowledgment of the same.

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14.The driver and owner of the offending vehicle filed their written statement and denied averments but from the written statement it does not appear that they mentioned any details of permit of the offending vehicle. Hon’ble Supreme Court in the case of Amrit Paul (Supra), held as under -

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“24. In the case at hand, it is clearly demonstrable from the materials brought on record that the vehicle at the time of the accident did not have a permit. The appellants had taken the stand that the vehicle was not involved in the accident. That apart, they had not stated whether the vehicle had temporary permit or any other kind of permit. The exceptions that have been carved out under Section 66 of the Act, needless to emphasise, are to be pleaded and proved. The exceptions cannot be taken aid of in the course of an argument to seek absolution from liability. Use of a vehicle in a public place without a permit is a fundamental statutory infraction. We are disposed to think so in view of the series of exceptions carved out in Section 66. The said situations cannot be equated with absence of licence or a fake licence or a licence for different kind of vehicle, or, for that matter, violation of a condition of carrying more number of passengers. Therefore, the principles laid down in National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 and Lakhmi Chand v. Reliance General Insurance, (2016) 3 SCC 100 in that regard would not be applicable to the case at hand. That apart, the insurer had taken the plea that the vehicle in question had no permit. It does not require the wisdom of the “Tripitaka”, that the existence of a permit of any nature is a matter of documentary evidence. Nothing has been brought on record by the insured to prove that he had a permit of the vehicle. In such a situation, the onus cannot be cast on the insurer. Therefore, the Tribunal as well as the High Court had directed that the insurer was required to pay the compensation amount to the claimants with interest with the stipulation that the insurer shall be entitled

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to recover the same from the owner and the driver. The said directions are in consonance with the principles stated in Swaran Singh (supra) and other cases pertaining to pay and recover principle.

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15.In the case of Challa Bharathamma (supra), it was held as under -

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“12. High Court was of the view that since there was no permit, the question of violation of any condition thereof does not arise. The view is clearly fallacious. A person without permit to ply a vehicle cannot be placed at a better pedestal vis-`-vis one who has a permit, but has violated any condition thereof. Plying of a vehicle without a permit is an infraction. Therefore, in terms of Section 149(2) defence is available to the insurer on that aspect. The acceptability of the stand is a matter of adjudication. The question of policy being operative had no relevance for the issue regarding liability of insurer. High Court was, therefore, not justified in holding the insurer liable.

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The residual question is what would be the appropriate direction. Considering the beneficial object of the Act, it would be proper for the insurer to satisfy the award, though in law it has no liability. In some cases the insurer has been given the option and liberty to recover the amount from the insured. For the purpose of recovering the amount paid from the owner, the insurer shall not be required to file a suit. It may initiate a proceeding before the concerned Executing Court as if the dispute between the insurer and the owner was the subject matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. Before release of the amount to the claimants, owner of the offending vehicle shall furnish security for the entire amount which the insurer will pay to the claimants. The offending vehicle shall be attached, as a part of the security. If necessity arises the Executing Court shall take assistance of the concerned Regional Transport Authority. The Executing Court shall pass appropriate orders in accordance with law as to the manner in which the owner of the vehicle shall make payment to the

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insurer. In case there is any default it shall be open to the Executing Court to direct realization by disposal of the securities to be furnished or from any other property or properties of the owner of the vehicle i.e. the insured. In the instant case considering the quantum involved we leave it to the discretion of the insurer to decide whether it would take steps for recovery of the amount from the insured.”

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16.Therefore, in view of the above discussion and in the light of judgment of the Supreme Court in the case of Mukund Dewangan v. Oriental Insurance Company Ltd., 2017 14 SCC 663, the submission with regard to violation of insurance policy on the ground of valid and effective driving license is liable to be rejected.

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In view of above discussion and following the above stated case laws of Hon’ble Supreme Court with regard to violation of permit, the appeal deserves to be allowed and is hereby allowed. The insurance company is exonerated from its liability to pay compensation, however, in the light of observation made in the case of Challa Bharatamma (supra), the insurance company is directed to pay the entire amount of compensation as awarded by the learned Tribunal and recover the same from the owner of the offending vehicle.

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Sd/-

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(Sachin Singh Rajput ) Judge

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Deepti

The Oriental Insurance Company Limited v. Banjami Linga

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The Oriental Insurance Company Limited v. Banjami Linga

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