Dismissed

The Oriental Insurance Company Ltd. Represented through Its Sr Divisional Manager v. Chhuma Devi and Ors.

Jharkhand HC9 Jun 2017MA/246/2015

Case brief

AI extract

What is this about?

In a motor accident appeal, the High Court held that the steel plant premises constituted a public place under the Motor Vehicles Act due to the public's right of access, thereby attracting the Insurance Company's liability. The appeal regarding quantum was dismissed, directing payment of the outstanding amount excluding interim payments.

What did the court decide?

Appellant directed to pay outstanding compensation excluding interim payments already made within two months.

The Oriental Insurance Company Ltd. Represented through Its Sr… — Insurance | Jharkhand HC (2017)

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IN THE HIGH COURT OF JHARKHAND AT RANCHI M.A. No.246 of 2015

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The Oriental Insurance Company Ltd.

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…… Appellant

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Versus

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Chhuma Devi, wife of Late Kedar Nath Murmu

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Mahabir Prasad Murmu, son of Late Kedar Nath Murmu

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Kamal Ram Murmu, son of Late Kedar Nath Murmu

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H.N. Singh Construction (Owner of Tailor No.NL01K-0443) …… Respondents

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CORAM: HON’BLE MR. JUSTICE AMITAV K. GUPTA

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For the Appellant : Mr. Ganesh C. Jha, Advocate For the Respondents : Mr. Saibal Kumar Laik, Advocate Mr. Mukesh Kumar, Advocate

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Dated : 9th June, 2017

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This appeal has been preferred against the judgment/award passed under Section 168 of the Motor Vehicle Act, 1988 (for short hereinafter referred to as 'M.V. Act') whereby the appellant/Oriental Insurance Company Ltd. has been directed to pay the awarded compensation of Rs.29,78,568/- (rupees twenty nine lakhs seventy eight thousand five hundred sixty eight only) with interest @ 9% from the date of application till payment.

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The claimants have filed the claim application stating therein that on 21.08.2012 deceased Kedar Nath Murmu was going to attend his duty in Bokaro Steel Plant and at 8.15 a.m., when he reached near the Blast Furnace No.3, a trailor, bearing registration No.NL01K-0443 which was being driven in rash and negligent manner ran over the deceased causing his death. For the said accident Marafari P.S. Case No.57 of 2012 was instituted.

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Learned counsel for the appellant/insurance company has assailed the impugned judgment and award mainly on the ground that the accident took place within the premises of Bokaro Steel Plant which is not a public place. Learned counsel has also stated that as per the F.I.R. recorded on the statement of Head Time Keeper, Bokaro Steel Plant, the accident took place at 8.15 a.m. and it has been specifically stated that there was no entry zone, between 08.00 a.m. to 09.00 a.m., meaning thereby, that the place was not accessible to the public hence, it was not a public place in terms of the definition in Section 2(34) of the M.V. Act, 1988. This amply demonstrates that the death was not on account of use of a vehicle in a public place in terms of Section 146 of the Act.

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It is argued that the Tribunal has erred in assessing or computing the compensation on the basis of the gross salary of Rs.36,439,42/- mentioned in the salary slip of July, 2008 i.e. Exhibit-5/1, without appreciating the fact that the gross salary was inclusive of other allowances. That in fact, the Tribunal should have assessed the income on the basis of basic pay of Rs.19,678/- and the dearness allowance of Rs.12,184/- which adds up to approximately Rs.31,000/- and should have deducted Rs.3123/- towards income tax as mentioned in the salary slip since the actual income is to be assessed less the tax as held in the case of Sarla Verma Vrs. D.T.C.; (2009) 6 SCC 121 which has also been followed in the case of Reshma Kumari Vrs. Madan Mohan; (2009) 13 SCC 422 . It is contended that the Tribunal has erred in directing to pay the entire compensation amount without appreciating the fact that the appellant had paid the interim compensation of Rs.50,000/- and the said amount should have been deducted from the award.

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Learned counsel has placed reliance on the decision reported in 1975 ACJ 226, 1982 AIR (Madras) 223 and 1982 ACJ 202(Gujrat High Court), and submitted that it would be evident from the ratio laid down in aforesaid cases that when the accident took place within the premises of the factory or an organisation, the same was held to be a private place and the insurance company was exonerated from the liability to pay the compensation as the use of a vehicle in a private place amounted to violation of the terms and conditions of the policy.

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On the above grounds it is contended that the Tribunal has failed to appreciate the settled proposition of law, therefore, the impugned judgment fastening the liability to pay the compensation upon the appellant should be set aside.

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On the other hand, learned counsel for the respondents/claimants has submitted that the ratio of the judgment relied upon by the learned counsel has been subsequently considered in the case of Divisional Manager, Oriental Insurance Co. Ltd. Vrs. Rabi Das and Another; 2013 ACJ 2110 wherein the decisions of the Bombay High Court has been discussed and it has been held that for deciding whether the place where the accident occurred was a public place or private place it has to be determined in terms of the definition under Section 2(34) of the Act. That a Full Bench of Bombay High Court in the case of Pandurang Chimaji Agale Vrs. New India Life Insurance Company; 1988 ACJ 674 (Bom.) has held that the word “public place” is a term of wide connotation which may include even a private place where public has a right of access restricted or

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otherwise. It is argued that in the case of National Insurance Co. Ltd. Vrs. Indira Srivastava and Another; (2008) SCC 763 at para 19, it has been held that the amount paid by way of perks should be included for computation of monthly income which forms part of the monthly income.

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Learned counsel for respondent/owner has submitted that the truck or the trailor was used by the sub-contractor for supplying goods and equipments to Bokaro Steel Plant and there is no averment that the said truck was debarred from entering the plant during the period of No Entry Zone between 8 a.m. to 9 a.m.

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In reply learned counsel for the appellant/insurance company has submitted that the F.I.R. has been marked as Exhibit and the Head Time Keeper has categorically stated that the period between 8 a.m. to 9 a.m. was a no entry zone period therefore, the trailor's entry at that point of time was due to the negligent act on the part of the driver of the trailor. This amounted to violation of the terms and condition of the policy as the vehicle was used in a private place hence, the liability to pay the compensation should be fastened upon the respondent/owner of the vehicle.

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Having heard the learned counsels, it is not disputed that the deceased died on account of being run over by trailor No. NL 01K – 0443 near Blast Furnace No.3 of Bokaro Steel Plant. The contention of the learned counsel for the appellant that in the decision rendered by the Full Bench of Bombay High Court the aspect or issue of no entry zone was not dealt with is rather misplaced because in the decision of Pandurang Chimaji Agale Vrs. New India Life Insurance Company (supra) the Full Bench of Bombay High Court has held that the definition of “public place” under the Act is, therefore, wide enough to include any place which members of public use and to which they have a right to access. The right of access may be permissive, limited, restricted or regulated by oral or written permission, by tickets, passes or badges or on payment of fee. The use may be restricted generally or for particular purpose or purposes. What is necessary is that the place must be accessible to the members of public and be available for their use, enjoyment, avocation or other purposes. The meaning of the expression “right to access” and “access as of right” has been elaborately discussed and it has been held that a place where members of public have a right of its use as a matter of right whether regulated, restricted or not, they cannot be denied said right except on legal grounds. On the other hand the expression

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“access as of right” denotes a place where the members of public have a right of use of the place whether regulated or not.

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In the aforesaid case the court has considered the divergent views of other High Courts and on elaborate discussion concluded that definition of “public place” under Section-2(34) of the Act, is an inclusive one and where the members of public have access for whatsoever reason as of right or controlled in any manner it would come within the definition of public place.

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In the instant case it is not disputed that the vehicle was used by the contractor for supplying equipments and materials to the factory. The vehicle had access to the premises and just because there was no entry zone during the period would only signify that there was restriction of entry and this did not tantamount to denial of right to access. In view of the interpretation of the definition of public place in the aforesaid decision the argument advanced by the learned counsel that just because the vehicle had entered during the period of no entry zone hence, it amounted to use of vehicle in a private place and not in public place is rather misplaced and not acceptable. It is well settled that the term “public place” cannot be given a narrow or restricted meaning and it is a word of wide connotation which includes a private place where the public has right to access restricted or regulated.

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It is well settled that the contractual liability under the insurance policy covers a third party risk and the liability to pay arises as per terms and conditions of the policy. The Insurance Company can avoid its liability in terms of the provision of Section 149(2). It is noticed that no evidence has been broughtforth that the accident had taken place on account of the fault of the owner of the place moreover, it is manifest from the above discussion that the place where the accident took place comes within the purview of a public place therefore the Insurance Company cannot escape the liability to pay the compensation, as Section 147 of the Act mandates compulsory insurance of the vehicle against third party risk and the contractual obligation to pay the compensation is upon the insurer. In the attending facts and circumstances and in view of materials on record it is held that no illegality has been committed by the court below in fastening the liability to pay the compensation upon the appellant/Insurance Company

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With respect to the quantum of compensation it is noticed that as per the salary slip i.e. Exhibit-5/1, i.e. salary slip of July, 2012, the gross salary of the

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deceased has been mentioned as Rs.36,459/- and Rs.3123 has been deducted towards income tax. Therefore the income of the deceased is assessed at Rs.33336/-. The contention of the learned counsel for the appellant that Rs.3123/- should have been deducted from the net income + dearness allowance is not acceptable because this would amount to double taxation and deduction of the income tax moreover, such contention is not acceptable as it is settled proposition that the salary is to be computed inclusive of perks and allowances. The Tribunal has not committed any error in computing the compensation on the basis of the salary, as mentioned in Exhibit-5/1, less the tax paid. Therefore the award does not require any interference.

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Learned counsel has submitted that Rs.50,000/- has been paid as interim compensation and in compliance of order dated 24.01.2017 Rs.10,00,000/- has been deposited in the court below. In the given circumstances, the insurance company shall pay the outstanding amount less the amount of Rs.50,000/- and Rs.10,00,00/- already paid, within two months from the date of this order.

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The Registry is directed to return the statutory amount in favour of the appellant.

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In the result the appeal stands dismissed.

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(Amitav K. Gupta, J.)

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NKC

The Oriental Insurance Company Ltd. Represented through Its Sr Divisional Manager v. Chhuma Devi and Ors.

Case brief

What is this about?

What did the court decide?

The Oriental Insurance Company Ltd. Represented through Its Sr Divisional Manager v. Chhuma Devi and Ors.

Case brief

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What did the court decide?

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