Allowed

The Oriental Insurance Company Ltd. v. Biju A.P.

Kerala HC12 Jun 2014MACA/2058/2012

Case brief

AI extract

What is this about?

Allowed an appeal against an award directing an insurer to pay compensation to a pillion rider under an act only policy. Held that no coverage exists without extra premium; award set aside against insurer and liability shifted to vehicle owner with reimbursement of deposited amount.

What did the court decide?

Impugned award directing insurer to pay and recover is set aside. Respondent owner to pay award amount. Insurer to be reimbursed for amount deposited under Section 173(1).

The Oriental Insurance Company Ltd. Vs Biju A.P. — Insurance | Kerala HC (2014)

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IN THE HIGH COURT OF KERALA AT ERNAKULAM

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PRESENT:

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THE HONOURABLE MR. JUSTICE B.KEMAL PASHA

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THURSDAY, THE 12TH DAY OF JUNE 2014/22ND JYAISHTA, 1936

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MACA.No. 2058 of 2012 ()

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OPMV 1391/2004 of MACT,PATHANAMTHITTA

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APPELLANT/3RD RESPONDENT:

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THE ORIENTAL INSURANCE COMPANY LTD METRO PALACE, GROUND FLOOR OPP.NORTH RAILWAY STATION ERNAKULAM, REP. BY ITS DULY AUTHORISED OFFICER.

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BY ADV. SRI.VPK.PANICKER

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RESPONDENTS/RESPONDENTS & PETITIONER:

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BIJU A.P., S/O.PURUSHOTHAMAN, ARANGAMUTTATHIL HOUSE NEDUMPURAM PO, THIRUVALLA 689 110.

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AJITH KUMAR, S/O.JAYAMOHAN PILLAI KOCHUPULLAVALLIL HOUSE MANNAR 689 622

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SASI, S/O.NARAYANAN, CHIREPARAMBU HOUSE MEPRAL PO., THIRUVALLA 689 591.

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R2 BY ADV. SRI.K.N.RADHAKRISHNAN(THIRUVALLA)

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THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 12-06-2014, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:

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B.KEMAL PASHA, J.

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M.A.C.A. No. 2058 of 2012

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............................................................... Dated this the 12^th day of June, 2014

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J U D G M E N T

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The 3^rd respondent in O.P.(MV) No.1391/2004 against

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whom an order to pay compensation was passed by the Motor Accident Claims Tribunal, Pathanamthitta, with permission to the 3^rd respondent to recover the said amount from the 2^nd respondent, has come up in appeal.

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The appellant had issued an 'act only policy ' in respect of the motorbike in question which was effective on the date of accident. The injured, who approached the Tribunal as petitioner, was the pillion rider of the said motorbike. Admittedly, no extra premium was obtained by

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M.A.C.A. 2058 of 2012

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-: 2 :-

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the appellant for covering any such gratuitous passenger or pillion rider. In spite of finding that there was no coverage, the Tribunal has gone to the extent of passing an order directing the appellant to pay the amount to the petitioner, and then to recover it from the registered owner of the motorbike.

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Heard the learned counsel for the appellant. There is no representation for any of the other parties.

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It is trite law that in the case of an 'act only policy ' there cannot be a coverage for the gratuitous passenger or the pillion rider, as the case may be, unless extra premium for such coverage has not been paid. In this case, the Tribunal has found that the policy in question was an 'act only policy ' which would not cover the pillion rider. In such a case, the insurer is not liable to pay the amount as per the decision in United India Insurance Company Limited v. Tilak Singh and Others [(2006) 4 SCC 404]. In National Insurance Company Limited Vs. Balan @ Balakrishnan

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M.A.C.A. 2058 of 2012

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-: 3 :-

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and Others [ 2008 (1) KHC 202], it was held that in the case of an 'act only policy', there is no coverage for the gratuitous passenger of a private vehicle, unless extra premium for such coverage is paid. The same is supported by the decision in National Insurance Co. Ltd. v. Parvathneni [2009 (3) KLT 995(SC)] wherein it was held that in cases wherein the insurance company has no liability to pay the compensation, it cannot be compelled to make the payment with a direction to recover it later from the owner of the vehicle. A Full Bench of this Court in Oriental Insurance

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Co. Ltd. v. Joseph [2012(2) KLT 132(FB)] also has held as follows:

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“By virtue of sub-s.(4) of S.149, Court has to see whether there has to be a direction to pay and recover. If there are violations of the terms of the policy, the question of pay and recover would arise. When the case of the deceased is not covered under the policy, the question of pay and recover would not arise.”

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M.A.C.A. 2058 of 2012

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-: 4 :-

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It seems that the Tribunal has erred in directing the appellant herein to pay the amount and recover it later from the 2^nd respondent. Therefore, that part of the impugned order is liable to be set aside.

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In the result, this M.A.C.A. is allowed and that part of the impugned award by which the appellant is directed to pay the amount and recover it from the 2^nd respondent, is set aside. The award amount has to be paid by the 2^nd respondent. The amount already deposited under Section 173(1) of the Motor Vehicles Act by this appellant, is ordered to be reimbursed to the appellant.

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Sd/- B. KEMAL PASHA, JUDGE

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ul/-

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[True copy] P.S. to Judge

The Oriental Insurance Company Ltd. v. Biju A.P.

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The Oriental Insurance Company Ltd. v. Biju A.P.

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