The New India Assurance Company Ltd. Vs Smt. Champa

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1

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2026:CGHC:13837

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NAFR

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Digitally VISHAKHA signed by BEOHAR VISHAKHA BEOHAR

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HIGH COURT OF CHHATTISGARH AT BILASPUR

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CR No. 72 of 2023

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1 - The New India Assurance Company Ltd. Through Its Divisional Manager, Divisional Office Akashvani Road, Jagdalpur, District Bastar, Chhattisgarh. ........................(Non-Applicant No. 3)

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--- Appellant

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versus

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1 - Smt. Champa W/o Maso (Father Chandar) Aged About 19 Years R/o Village Pakhnar, Sukhapara, P.S. Darbha, O.P. Pakhanar, District Bastar, Chhattisgarh. ...................(Applicant)

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2 - Laxman Singh Thakur S/o Dhanman Singh Thakur Aged About 25 Years Caste Dhakad, R/o Village Kalepal Patelpara, District Bastar, Chhattisgarh. ......................(Driver) (Non-Applicant No. 1)

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3 - Kamal Singh Thakur S/o Dasram Thakur Aged About 33 Years R/o Village Pakhanar Paikpara, Tah. Darbha, O.P. Pakhnar, District Bastar, Chhattisgarh. ................(Registered Owner)

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--- Respondent(s)

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MAC No. 994 of 2023

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2

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1 - The New India Assurance Company Ltd. Through Its Divisional Manager, Divisional- Office, Akashvani Raod, Jagdalpur, Distt- Bastar (C.G.).

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--- Appellant

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Versus

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1 - Rupu Markam S/o - Gundaru Markam, Aged About 33 Years R/o Village- Pakhnar, Dongriguda Para, P.S. - Darbha, O.P. Pakhnar Distt.Bastar (C.G.).

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2 - Ku. Sangeeta Markam, ,d/o- Rupu Markam, Aged About 16 Years Through Their Father- Rupu Markam (Respondent No.1) R/o VillagePakhnar, Dongriguda Para, P.S. - Darbha, O.P. Pakhnar Distt.- Bastar (C.G.).

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3 - Sontosh, S/o- Rupu Markam, Aged About 12 Years Minor Trhough Their Father- Rupu Markam ( Respondent No.1)r/o Village- Pakhnar, Dongriguda Para, P.S. - Darbha, O.P. Pakhnar Distt.- Bastar (C.G.).

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4 - Gandaru S/o- Late- Bhima Markam, Aged About 65 Years R/o Village- Pakhnar, Dongriguda Para, P.S. - Darbha, O.P. Pakhnar Distt.Bastar (C.G.).

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5 - Laxman Singh Thakur, S/o- Dhanman Singh Thakur, Aged About 25 Years Caste- Dhakad, R/o- Village- Kalepal Patelpara, Tah.- Takopal, Distt- Bastar (C.G.) Driver

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6 - Kamal Singh Thakur, S/o- Dasram Thakur, Aged About 33 Years R/o- Vill.-Pakhnar Paikpara, Tah.-Darbha, O.P.- Pakhnar, DistrictBastar (C.G.).(Registered Owner).

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--- Respondent(s)

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MAC No. 978 of 2023

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3

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1 - The New India Assurance Company Ltd. Through Its Divisional Manager, Divisional - Office Akashvani Road, Jagdalpur, District - Bastar (Chhattisgarh) (Non- Applicant No. 3)

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--- Appellant

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Versus

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1 - Sitaram S/o Late Baaman Aged About 22 Years Caste - Madiya, R/o Village - Pakhnar, Sukhapara, P.S. - Darbha, O.P.- Pakhnar, District - Bastar (Chhattisgarh) (Applicant No. 1)

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2 - Smt. Piso W/o Late Dula Aged About 63 Years Caste - Madiya, R/o Village - Pakhnar, Sukhapara, P.S. - Darbha, O.P.- Pakhnar, District - Bastar (Chhattisgarh) (Applicant No. 2)

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3 - Laxman Singh Thakur S/o Dhanman Singh Thakur Aged About 25 Years Caste - Dhakad, R/o Village Kalepal Patelpara, Tah. - Tokapal, District - Bastar (Chhattisgarh) (Driver) (Non- Applicant No.1)

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4 - Kamal Singh Thakur S/o Dasram Thakur Aged About 33 Years R/o Village Pakhnar Paikpara, Tah.- Darbha, O.P.- Pakhnar, District - Bastar (Chhattisgarh) (Registered Owner) (Non- Applicant No. 2)

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... Respondents

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(Cause-title taken from the Case Information System)

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For Appellant-Insurance Company :- Mr. Pravesh Sahu, Advocate on behalf of Mr. Dashrath Gupta, Advocate For Owner :- Mr. Vikash A. Shrivastava, Advocate For Claimants :- Mr. Sunder Lal Sahu, Advocate

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SB-Hon’ble Shri Justice Amitendra Kishore Prasad

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Order on Board

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23.03.2026

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Since all the aforesaid cases arise out of the same accident that occurred on 09.04.2019, the same are being decided jointly by this common order.

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As per the averments made in the claim petition, on the date of the accident, i.e., 09.04.2019 at about 04:30 PM, near the cremation ground (Marghat) of village Pakhnar, the applicant, Smt. Champa, along with Smt. Muye @ Muhe and Smt. Payke, was returning to her village on foot along the roadside after purchasing vegetables from the market. It has been averred that when they reached near Marghatti, a Mahindra Jeep bearing registration No. CG-19 T 0329, allegedly belonging to Kamal Singh Thakur of the village, came from the opposite side and was being driven by Laxman Singh Thakur (Driver of the offending vehicle) in a rash and negligent manner. The said vehicle was allegedly brought towards the roadside and hit the aforesaid persons forcefully, resulting in the accident. It is further averred that due to the said accident, all three persons, namely Smt. Muye @ Muhe, Smt. Payke and Smt. Champa, sustained grievous injuries and became unconscious. They were immediately taken to the Primary Health Centre, Darbha, where Smt. Muye @ Muhe and Smt. Payke were declared dead, whereas Smt. Champa, being in critical condition, was referred to Dimrapal for further treatment.

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Learned counsel for the appellant–The New India Assurance Company Limited submits that the learned Tribunal has committed grave illegality in fastening liability upon the insurance company despite there being clear violation of the terms and conditions of the insurance policy governing the vehicle in

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question. It is contended that the offending vehicle, namely Mahindra Jeep, though insured under a policy meant for a private/light motor vehicle, was admittedly being plied as a passenger vehicle at the time of the accident and was carrying passengers in a manner not permissible under the policy conditions. According to learned counsel, use of the insured vehicle for commercial or passenger transport purposes, contrary to the class of use permitted under the insurance policy, constitutes a fundamental breach of policy conditions, thereby absolving the insurer from statutory liability. It is further submitted that the material brought on record clearly demonstrates that the vehicle was not being used strictly in accordance with the purpose for which insurance coverage had been obtained. In such circumstances, once breach of policy conditions is established, the insurer cannot be saddled with liability to indemnify the owner, unless it is shown that such breach was not fundamental in nature or had no nexus with the accident. Learned counsel submits that the Tribunal failed to properly appreciate this legal aspect and mechanically fastened liability upon the insurance company without recording any specific finding as to whether the insured had complied with the contractual terms of the policy. It is argued that the burden having been discharged by the insurance company regarding breach of policy conditions, the Tribunal ought to have exonerated the insurer from liability, or at least ought to have directed pay-and-recover, if considered

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appropriate in the facts of the case. It is also contended that where a vehicle insured for one category is used for another impermissible purpose, such use materially enhances risk and directly affects the contractual obligations of the insurer. In support of the said contention, reliance is placed upon the law laid down by the Hon’ble Supreme Court in National Insurance Co. Ltd. v. Swaran Singh (2004) 3 SCC 297 , wherein it has been held that breach of policy conditions is a relevant consideration while determining insurer’s liability, and in appropriate cases the insurer may either be exonerated or granted recovery rights. Learned counsel further submits that the Tribunal has failed to appreciate that fastening liability upon the insurer despite clear policy breach amounts to imposing contractual liability contrary to law. Therefore, the impugned award to the extent it saddles the appellant–insurance company with liability deserves to be set aside.

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Learned counsel appearing on behalf of the owner of the offending vehicle submits that he has filed vakalatnama in C.R. No. 72/2023 and since the same offending vehicle is involved in all connected matters, his submissions may be treated as made on behalf of the owner in the present case as well. Learned counsel appearing for the respondent-owner further submits that the ground raised by the appellant–insurance company regarding alleged violation of policy conditions has not been established by any cogent evidence available on record. It is contended that

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except raising a bald plea in the memorandum of appeal, the insurance company has failed to adduce any evidence to demonstrate that the offending vehicle was being plied as a passenger vehicle at the time of the accident in breach of policy conditions. It is further submitted that there is no material, oral or documentary, indicating that the vehicle in question was being used for commercial passenger transport or was carrying passengers for hire or reward. No witness has stated in evidence that the vehicle was operating as a passenger vehicle, nor has any document been brought on record to substantiate such allegation. Learned counsel submits that in absence of proof of fundamental breach of policy conditions, the insurer cannot escape its statutory liability merely on the basis of presumptions or unsupported pleadings. The burden to establish breach squarely lies upon the insurer, and unless such burden is duly discharged, the liability rightly remains upon the insurance company. It is, therefore, contended that the learned Tribunal has committed no illegality in fastening liability upon the insurance company and the contention advanced by the appellant deserves rejection.

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Learned counsel appearing for the claimants has also submitted that there is nothing available on record to establish that the offending vehicle was being plied as a passenger vehicle at the time of the accident and, therefore, the plea regarding violation of the terms and conditions of the insurance policy is wholly

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unfounded. It is contended that no evidence, either oral or documentary, has been adduced by the appellant–insurance company to prove that the vehicle was being used for carriage of passengers for hire or reward or for any purpose contrary to the class of use permitted under the policy. In absence of proof of any fundamental breach of policy conditions, the insurer cannot avoid its statutory liability under law. Learned counsel further submits that the burden to establish breach of policy conditions squarely lies upon the insurance company, and since such burden has not been discharged in the present case, the learned Tribunal has rightly fastened liability upon the insurance company while passing the impugned award.

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I have heard learned counsel for the parties and perused the material available on record.

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From the perusal of the record as well as the impugned award, it appears that although the appellant–insurance company has raised a specific ground that the offending vehicle was being plied as a passenger vehicle in violation of the terms and conditions of the insurance policy, the said plea is not supported by cogent evidence available on record. A careful examination of the evidence adduced before the learned Tribunal reveals that none of the witnesses examined from the side of the claimants has stated that the offending vehicle was being used as a passenger vehicle at the time of the accident. Likewise, from the evidence of

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NAW-1 Prakash Chandra Dhruv, NAW-2 Mohd. Shabbir Qureshi and NAW-3 Shahbaz Siddiqui, no material has emerged to establish that the vehicle was being plied for carriage of passengers for hire or reward or for any purpose contrary to the policy conditions.

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In absence of any clear oral or documentary evidence demonstrating breach of policy conditions, the burden cast upon the insurance company to prove fundamental violation remains undischarged. Mere raising of a plea without substantiating the same by evidence cannot absolve the insurer of its statutory liability.

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Accordingly, this Court finds no infirmity in the finding recorded by the learned Tribunal while fastening liability upon the appellant– insurance company. The award passed by the Tribunal does not call for interference on this ground.

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Consequently, the appeals being devoid of merit are liable to be and are hereby dismissed.

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Sd/(Amitendra Kishore Prasad) Judge

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Vishakha

The New India Assurance Company Ltd. v. Smt. Champa

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The New India Assurance Company Ltd. v. Smt. Champa

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