Partly allowed

U.I.Ins.Co.Ltd. v. Sanju Devi and Ors.

Rajasthan HC29 Aug 2023CMA/278/2010

Case brief

AI extract

What is this about?

The High Court in this civil miscellaneous appeal modified the Motor Accident Claims Tribunal's award holding an insurer under an 'Act only policy' not liable to pay compensation to the occupants of the insured vehicle, exonerating the insurance company from liability. Appeal allowed.

What did the court decide?

The judgment and award of the Tribunal modified to exonerate the appellant Insurance Company from liability for compensation; respondents 1, 2, and 3 remain liable.

U.I.Ins.Co.Ltd. Vs Sanju Devi and Ors. — Motor Accident Claims | Rajasthan HC (2023)

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[2023:RJ-JD:27507]

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HIGH COURT OF JUDICATURE FOR RAJASTHAN AT JODHPUR

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S.B. Civil Misc. Appeal No. 278/2010

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United India Insurance Company Limited, Lohagal Road, Opposite SBBJ Bank Shastri Nagar Road, Ajmer through its Divisional Manager

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----Appellant

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Versus

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Sanju Devi W/o Late Rameshwar, caste Jaat, resident of Haripura, District Nagaur (Raj.)

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Mahendra S/o Late Rameshwar, Caste Jaat, resident of Haripura, District Nagaur (Raj.)

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Ganpat Ram S/o Bhura Ram, caste Jaat, resident of Haripura, District Nagaur (Raj.)

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Sundari W/o Ganpat Ram, caste Jaat, resident of Haripura, District Nagaur (Raj.)

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Harendra Singh @ Rahindra Singh S/o Amar Singh, caste Rajput, resident of Kankaria, Teshil Nava, District Nagaur (Raj.)

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Amar Singh S/o Sh. Devi Singh, Caste Rajput, resident of Kankaria, Tehsil Nava, District Nagaur (Raj.)

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Brahmanand S/o Gokulchand Sharma, caste Sharma, resident of Kharkara, Pata, (Neem Ka Thana), District Sikar (Raj.)

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----Respondent

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For Appellant(s)	: Mr. Jagdish Vyas
For Respondent(s)	: Mr. Bhagat dadhich
	Mr. KuldeepSingh

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HON'BLE MR. JUSTICE MADAN GOPAL VYAS

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Judgment

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DATE OF JUDGMENT: 29/08/2023

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The appellant-Insurance Company has filed the present civil miscellaneous appeal under Section 173 of the Motor Vehicles Act, 1988 against judgment and award dated 23.04.2009 passed by

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Motor Accident Claims Tribunal, Parbatsar (hereinafter referred to as the learned Tribunal) in Claim Case no. 12/2007, whereby, the learned Tribunal has awarded a sum of Rs. 3,47,400/- as compensation to the claimants on account of death of Rameshwar along with interest and has held the appellant-Insurance Company alongwith the owner and driver of the vehicle jointly and severally liable for payment of compensation.

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The facts in a nutshell giving rise to the present appeal are that on 23.11.2006, the deceased Rameshwar and Bhagu Ram alongwith Sanju (respondent No. 1 herein) were travelling in a jeep bearing registration number RJ 14 1C 6702 which was being driven by Harendra Singh (respondent no. 5 herein). The jeep collided with a tree and turned upside down on account of which Bhagu Ram died on spot and Rameshwar died during his treatment.

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The Tribunal after hearing the parties, inter alia, held that since the jeep was insured on the date of the accident, the respondent-Insurance Company is jointly and severally liable alongwith respondent nos. 1, 2 and 3. After determining the compensation based on the income and age of the deceased, learned Tribunal passed the award aforesaid.

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Mr. Jagdish Vyas, learned counsel for the appellant submits that the jeep which met with an accident was a private jeep and was insured under an ‘Act only policy’ in the name of ownerrespondent no. 7-Brahmanand. It is submitted that the passengers travelling in the said jeep were gratuitous passengers for whom no premium had been taken by the appellant-Insurance

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Company. Moreover, the driver of the jeep also did not possess any valid driving license on the date of accident. It is further submitted that the finding of the learned Tribunal with respect of issue no. 4 is erroneous and cannot be sustained in the eyes of law. Thus, it is prayed that the appellant-Insurance Company be exonerated from its liability. In support of the contentions, reliance was placed on the following judgments:

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(I) Oriental Insurance Co. Ltd. v. Meena Variyal reported in (2007) 7 SCC 425.

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(II) National Insurance Company Ltd. v. Smt. Sahidam Bano reported in 2015 (2) R.A.R. 892 (Raj.)

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(III) Oriental Insurance Co. Ltd. v. Smt. Sharda Devi and Ors, SBCMA No. 696/2003, decided on 04.08.2016, Rajasthan High Court.

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Mr. Bhagat Dadhich and Mr. Kuldeep Singh, learned counsel for the respondents-claimants vehemently opposed the submissions made by learned counsel for the appellant. It is submitted that the finding recorded by the Tribunal regarding the liability of the Insurance Company does not call for any interference.

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I have considered the rival submissions made by learned counsel for the parties and have perused the material available on record.

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From the averments made by the claimants in the claim petition and the evidence led by the claimants, it is an admitted position that deceased was occupant of the insured jeep. It is also an admitted position that in course of treatment, Rameshwar died.

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Further, learned Tribunal, in para 15 of the impugned judgment has given a finding that the owner and driver of the jeep in their statements have admitted that they did not take any fare from the passengers and the vehicle was not used for hire.

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I have also perused the Schedule of Premium Of Liability Only policy of Jeep bearing No.RJ-14-IC-6702, which reads as under:

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“SCHEDULE OF PREMIUM

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TP Basic 700.00
For third party property damage
of 6000 IMT-20 -100.00
Compulsory PA to Owner-Driver
amount Rs.200000 100.00
WC to employee I 25.00
Loading on TP Premium 160.00
Stamp Duty 1.00
Total Liability Premium Rs.885.00”

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A perusal of the Schedule of Premium reflects that no premium was charged for passengers.

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The liability of the Insurance Company pertaining to the ‘Act only policy’ qua the occupants of the vehicle is no more res integra as laid down by Hon'ble Supreme Court in the case of Meena Variyal (supra) and subsequent judgment of Hon'ble Supreme Court in the case of National Insurance Company Limited v. Balkrishnan & Anr. : (2013) 1 SCC 731 , wherein, it has been held as under:-

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“26. In view of the aforesaid factual position, there is no scintilla of doubt that a “comprehensive/package policy” would cover the liability of the insurer for payment of compensation for the occupant in a car. There is no cavil that an “Act policy” stands on a different footing from a “comprehensive/package policy”. As the circulars have made the position very clear and the IRDA, which is presently the statutory authority, has

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commanded the insurance companies stating that a “comprehensive/package policy” covers the liability, there cannot be any dispute in that regard. We may hasten to clarify that the earlier pronouncements were rendered in respect of the “Act policy” which admittedly cannot cover a third party risk of an occupant in a car. But, if the policy is a “comprehensive/package policy”, the liability would be covered. These aspects were not noticed in the case of Bhagyalakshmi and, therefore, the matter was referred to a larger Bench. We are disposed to think that there is no necessity to refer the present matter to a larger Bench as IRDA, which is presently the statutory authority, has clarified the position by issuing circulars which have been reproduced in the judgment by the Delhi High Court and we have also reproduced the same.”

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(Emphasis supplied)

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This Court in the case of Sharda Devi (supra) has also relied on the judgment in the case of Meena Variyal (supra) and has held that in ‘Act only policy’, the risk of occupant of the vehicle is not covered as the occupant is not a third party.

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In view of the law laid down by Hon'ble Supreme Court and in view of the undisputed facts, the Tribunal was not justified in holding the appellant Insurance Company liable for making payment of the amount of compensation. The finding on issue no. 4, is therefore, reversed.

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Hence, the present appeal is allowed. The judgment and award dated 23.04.2009 passed by the Tribunal is modified to the extent that though the respondents no. 1, 2 and 3 would be jointly and severally liable to make payment of the amount of compensation as awarded by the Tribunal, the appellant Insurance Company is exonerated from its liability to make payment under the award. Any amount paid by the appellant Insurance Company

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in terms of the award shall also be open to be recovered from the

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respondent Nos. 1, 2 and 3.

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