Partly allowed

The Divisional Manager v. Channappa S/O Sidlingappa Dharwad

Karnataka HC13 Sept 2024MFA/103129/2014

Case brief

AI extract

What is this about?

Insurer appealed a Tribunal award directing it to pay compensation to an accident claimant and recover from the vehicle owner due to the rider lacking a valid licence. Upholding the pay-and-recover order per the Full Bench decision, the High Court reduced the interest rate from 8% to 6% per annum and partly allowed the appeal.

What did the court decide?

Tribunal award modified reducing interest from 8% to 6% per annum; other findings unaltered; deposit amount transmitted to Tribunal.

The Divisional Manager Vs Channappa S/O Sidlingappa Dharwad — Insurance | Karnataka HC (2024)

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NC: 2024:KHC-D:13133 MFA No. 103129 of 2014

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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 13^TH DAY OF SEPTEMBER 2024 BEFORE

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THE HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR

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MISCELLANEOUS FIRST APPEAL NO. 103129 OF 2014

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BETWEEN:

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THE DIVISIONAL MANAGER, THE ORIENTAL INSURANCE CO.LTD., NEAR JUBLIE CIRCLE, P.B.ROAD, DHARWAD, (INSURER OF MOTOR CYCLE BEARING NO.KA-26/E-8190) REP.BY ITS DEPUTY MANAGER.

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…APPELLANT

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(BY SRI. S.S. KOLIWAD, ADVOCATE)

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AND:

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CHANNAPPA S/O. SIDLINGAPPA DHARWAD, AGE: 30 YEARS, OCC: BOREWELL REPAIRER (MECANIC), R/O: AMINBHAVI VILLAGE, TQ: AND DIST: DHARWAD.

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YASHAVANT NARAYANKAR

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Location: HIGH COURT OF KARNATAKA

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SURESH S/O. VENKAPPA DODDMANI, HOUSE NO.323, AT: TIMMAPUR VILLAGE, TQ: DHARWAD, DIST: DHARWAD, (OWNER OF MOTOR CYCLE NO. KA-26/E-8190).

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…RESPONDENTS

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(BY SRI. C.S. NAGASHETTI, ADVOCATE FOR R1; R2-SERVED UNREPRESENTED)

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THIS MFA IS FILED U/S.173(1) OF MV ACT, 1988, PRAYS TO CALL FOR THE RECORDS CONNECTED WITH AWARD AND JUDGMENT MADE IN MVC NO.955/2012 ON THE FILE OF THE HON’BLE COURT OF FAST TRACK AND ADDITIONAL MACT., DHARWAD, EXAMINE THE SAME AND SET ASIDE THE AWARD DATED 10.09.2014 IN THE INTEREST OF JUSTICE.

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THIS APPEAL COMING ON FOR ADMISSION THIS DAY, THE COURT DELIVERED THE FOLLOWING:

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CORAM: THE HON'BLE MR. JUSTICE SHIVASHANKAR AMARANNAVAR

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2 - NC: 2024:KHC-D:13133 MFA No. 103129 of 2014

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ORAL JUDGMENT

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This appeal is filed by the insurance company challenging the order of the Tribunal to pay and recover passed in MVC No.955/2012 dated 10.09.2014 by the Court of Fast Track and Additional MACT, Dharwad.

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Respondent No.1 who was injured in a road traffic accident made a claim petition seeking compensation. The Tribunal after recording evidence has awarded compensation of Rs.1,61,373/- with interest at 8% per annum from the date of petition till realization. The Tribunal has directed the insurance company to pay compensation and to recover the same from the owner of the vehicle i.e. respondent No.2 herein. The said order of the Tribunal is challenged in this appeal.

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Heard the learned counsel for the appellant and the learned counsel for the respondent No.1.

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3 - NC: 2024:KHC-D:13133 MFA No. 103129 of 2014

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Learned counsel for the appellant would contend that the rider of the offending vehicle did not possess driving licence and it has been established and it amounts to fundamental breach and the order of the Tribunal to pay and recover is not correct. He further contends that the Tribunal awarding interest @ 8% per annum on the compensation is on the higher side.

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The learned counsel for respondent No.1 contends that even though there is breach of any condition of policy or fundamental breach, as the insurer had undertaken to pay the 3^rd party risk, the insurer is liable to pay the compensation and it has to recover the same from the owner of the vehicle. On that point, he placed reliance on the decision of Full Bench of this Court rendered in New India Assurance Company Limited, Bijapur v. Yallavva w/o Yamanappa Dharanakeri and another¹

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1 2020 (2) AKR 484

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4 - NC: 2024:KHC-D:13133 MFA No. 103129 of 2014

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Having heard the learned counsel, the Court has perused the judgment and award passed by the Tribunal.

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The Tribunal considering the evidence on record, has held that the rider of the motorcycle was not holding valid and effective driving licence to ride the offending vehicle and thereby violated the terms and conditions of the insurance policy. The Tribunal held respondent No.1-owner of the vehicle liable to pay the compensation and directed the insurance company to pay the compensation and recover it from respondent No.1. The Tribunal has relied on the decision in the case of National Insurance Company Limited v. Smt. J.C. Ramadevi and others² . In Yallavva’s case (supra) Full Bench of this Court has considered the said aspect in detail and has held that the insurer has undertaken to pay the 3^rd party risk and therefore, liable to pay the compensation to 3^rd party and recover the same

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2 2014 KAR.MAC 119 (KAR)

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5 - NC: 2024:KHC-D:13133 MFA No. 103129 of 2014

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from insured even though there was a breach of any condition of the policy or fundamental breach. Considering the said aspect, the judgment of the Tribunal, ordering to pay and recover cannot be found fault with.

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The Tribunal has awarded interest on the compensation @ 8% per annum from the date of petition till the date of deposit. The rate of interest awarded by the Tribunal at 8% per annum is on the higher side. Interest as per the decisions of this Court and Apex Court has to be awarded at 6% per annum.

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In view of the above, the following

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ORDER

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The appeal is allowed in part. The judgment and award dated 10.09.2014 passed by the Court of Fast Track and Additional MACT, Dharwad, in MVC No.955/2012 is modified only to the extent of reducing the rate of interest on the compensation

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6 - NC: 2024:KHC-D:13133 MFA No. 103129 of 2014

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from 8% per annum to 6% per annum. The other findings of the Tribunal remains unaltered.

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The amount in deposit is ordered to be

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transmitted to the Tribunal concerned.

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Sd/(SHIVASHANKAR AMARANNAVAR) JUDGE

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Kmv CT:ANB

The Divisional Manager v. Channappa S/O Sidlingappa Dharwad

Case brief

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The Divisional Manager v. Channappa S/O Sidlingappa Dharwad

Case brief

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