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United India Insurance Co. Ltd. Vs. Sidharat Raju and Others - Court Judgment

LegalCrystal Citation
CourtPunjab and Haryana High Court
Decided On
AppellantUnited India Insurance Co. Ltd.
RespondentSidharat Raju and Others
Excerpt:
.....into the facts of the present case we are of the view that the claimants were not entitled to claim compensation under section 163-a of the mva and to that extent the high court was justified in coming to the conclusion that the said provision is not applicable to the facts and circumstances of the present case. however, the question remains as to whether an application for demand of compensation could have been made by the legal representatives of the deceased as provided in section 166 of the mva. the said provision specifically provides that an application for compensation arising out of an accident of the nature specified in sub-section (1) of section 165 may be made by the person who has sustained the injury; or by the owner of the property; or where death has resulted from the.....
Judgment:

FAO-1665-2010 (O&M) 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO-1665-2010 (O&M) Date of decision:

10. 2.2014 United India Insurance Co. Ltd. ...Appellant Versus Sidharat Raju and others ...Respondents CORAM: HON'BLE MR.JUSTICE JITENDRA CHAUHAN Present: Mr.VM Gupta, Advocate for the appellant Mr.Arun Takhi, Advocate for respondent Nos. 1 and 2 Mr.Ravi Kamal Gutpa, Advocate /Amicus Curiae **** Jitendra Chauhan, J.

The present appeal has been filed by the Insurance Company, challenging the impugned Award dated 9.12.2009, passed by the learned Motor Accident Claims Tribunal, Hoshiarpur, ( in short 'the Tribunal') vide which, a sum of Rs.4,49,960/- has been awarded to the claimants and the appellant being the insurer alongwith the driver and the owner of the offending vehicle has been held liable.

2. Learned counsel for the appellant -Insurance Company contended that the award is against the provisions of the Motor Vehicles Act (for short 'the Act'). As per the provision of the Act, in Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 2 MACT cases there are three necessary parties i.e. claimant, insured and the insurer. In the instant case, the deceased has stepped into the shoes of the owner. Thus, the deceased cannot be termed as a third party for the purpose of awarding the compensation under the Act.

3. Learned counsel further contended that the findings returned by the learned Tribunal are on incorrect appreciation of the law enunciated by the Hon'ble Supreme Court in Ningamma & another vs. United India Insurance Co. Ltd. 2009(3) RCR (Civil), 435. Thus, the learned counsel argued that as the claim petition was filed under Section 163-A of the Act, it is primarily the liability of the owner to indemnify the claim.

4. On the other hand, the learned counsel appearing for respondent Nos. 1 and 2 submits that the matter be remanded back to the Tribunal for fresh adjudication, as the claimants prefers to file petition under Section 166 of the Act.

5. I have heard the learned counsel for the parties and perused the record carefully.

6. It is not disputed that at the time of accident, Raj Kumar Raju, since deceased, was the driver of the offending vehicle and he was not a paid driver. The vehicle was owned by the wife of the deceased. He borrowed the car from the registered owner. The claim petition was preferred under Section 163-A of the Act, by the LRs of the deceased against the owner and the insurer of the offending car. Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 3 As the deceased borrowed the car from the owner, he stepped into the shoe of the owner. The Insurance Policy is a contract of insurance only provides for indemnity to the insurer company as the liability of the owner towards third party and not the user /rider, who steps into the shoes of the insured himself. The premium was paid towards personal accident. Therefore, the Insurance company cannot be burdened with the liability of compensation to the LRs of the deceased, who borrowed the vehicle from the registered owner.

7. It is amply proved on record that the deceased was at fault and Section 163-A of the Act is not meant to extend the benefit to the tort feaser. The party, who suffered loss in the MACT claims must be the third party, whereas in the present case, the LRs filed the claim petition against the registered owner and the insurer of the car.

8. The Hon'ble Supreme Court in Ningamma and another vs. United India Insurance Co. Ltd. 2009 ACJ, 2020, held in paras No.13, 18, 19, 20, as under:- 13. In the light of the aforesaid submissions, the question that falls for our consideration is whether the legal representatives of a person, who was driving a motor vehicle, after borrowing it from the real owner meets with an accident without involving any other vehicle, would be entitled to compensation under Section 163-A of MVA or under any other provision(s) of law and also whether the insurer who issued the insurance policy would be bound to indemnify the deceased or his Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 4 legal representative?. Before dwelling further, it would be useful to discuss the relevant paras of Section 163-A and 166 of the MVA applicable in the present case. “163-A. Special provisions as to payment of compensation on structured formula basis.— (1) Notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle of the authorised insurer shall be liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be. xx xx xx (2) In any claim for compensation under sub- section (1), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person. (3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time amend the Second Schedule.”. 166. Application for compensation- (1) An application for compensation arising out of an accident of the nature specified in sub-section (1) of section 165 may be made- (a) by the person who has sustained the injury; or Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 5 (b) by the owner of the property; or (c) where death has resulted from the accident, by all or any of the legal representatives of the deceased; or (d) by any agent duly authorised by the person injured or all or any of the legal representatives of the deceased, as the case may be: Provided that where all the legal representatives of the deceased have not joined in any such application for compensation, the application shall be made on behalf of or for the benefit of all the legal representatives of the deceased and the legal representatives who have not so joined, shall be impleaded as respondents to the application. Xx xx xx 18. In the case of Oriental Insurance Company Ltd. v. Rajni Devi and Others, (2008) 5 SCC736 wherein one of us, namely, Hon’ble Justice S.B. Sinha is a party, it has been categorically held that in a case where third party is involved, the liability of the insurance company would be unlimited. It was also held in the said decision that where, however, compensation is claimed for the death of the owner or another passenger of the vehicle, the contract of insurance being governed by the contract qua contract, the claim of the claimant against the insurance company would depend upon the terms thereof. It was held in the said decision that Section 163- A of the MVA cannot be said to have any application in respect of an accident wherein the owner of the motor vehicle himself is involved. The decision further held Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 6 that the question is no longer res integra. The liability under section 163-A of the MVA is on the owner of the vehicle. So a person cannot be both, a claimant as also a recipient, with respect to claim. Therefore, the heirs of the deceased could not have maintained a claim in terms of Section 163-A of the MVA. In our considered opinion, the ratio of the aforesaid decision is clearly applicable to the facts of the present case. In the present case, the deceased was not the owner of the motorbike in question. He borrowed the said motorbike from its real owner. The deceased cannot be held to be employee of the owner of the motorbike although he was authorised to drive the said vehicle by its owner, and therefore, he would step into the shoes of the owner of the motorbike.

19. We have already extracted Section 163-A of the MVA hereinbefore. A bare perusal of the said provision would make it explicitly clear that persons like the deceased in the present case would step into the shoes of the owner of the vehicle. In a case wherein the victim died or where he was permanently disabled due to an accident arising out of the aforesaid motor vehicle in that event the liability to make payment of the compensation is on the insurance company or the owner, as the case may be as provided under Section 163-A. But if it is proved that the driver is the owner of the motor vehicle, in that case the owner could not himself be a recipient of compensation as the liability to pay the same is on him. This proposition is absolutely clear on a reading of Section 163-A of the MVA. Accordingly, the legal representatives of the deceased who have stepped into Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 7 the shoes of the owner of the motor vehicle could not have claimed compensation under Section 163-A of the MVA.

20. When we apply the said principle into the facts of the present case we are of the view that the claimants were not entitled to claim compensation under Section 163-A of the MVA and to that extent the High Court was justified in coming to the conclusion that the said provision is not applicable to the facts and circumstances of the present case. However, the question remains as to whether an application for demand of compensation could have been made by the legal representatives of the deceased as provided in Section 166 of the MVA. The said provision specifically provides that an application for compensation arising out of an accident of the nature specified in sub-section (1) of section 165 may be made by the person who has sustained the injury; or by the owner of the property; or where death has resulted from the accident, by all or any of the legal representatives of the deceased; or by any agent duly authorised by the person injured or all or any of the legal representatives of the deceased, as the case may be. When an application of the aforesaid nature claiming compensation under the provisions of Section 166 is received, the Tribunal is required to hold an enquiry into the claim and then proceed to make an award which, however, would be subject to the provisions of Section 162, by determining the amount of compensation, which is found to be just. Person or persons who made claim for compensation would thereafter be paid such amount. When such a Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 8 claim is made by the legal representatives of the deceased, it has to be proved that the deceased was not himself responsible for the accident by his rash and negligent driving. It would also be necessary to prove that the deceased would be covered under the policy so as to make the insurance company liable to make the payment to the heirs. In this context reference could be made to relevant paras of Section 147 of the MVA which reads as follows:- 147. Requirements of policies and limits of liability- (1) In order to comply with the requirement of this Chapter, a policy of insurance must be a policy which- (a) is issued by a person who is an authorised insurer; or (b) insurer the person or classes of persons specified in the policy to the extent specified in sub-section (2)- (i) against any liability which may be incurred by him in respect of the death of or bodily [injury to any person, including owner of the goods or his authorised representative carried in the vehicle]. or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place; (ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place: Provided that a policy shall not be required- (i) to cover liability in respect of the death, arising out of Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 9 and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen’s Compensation Act, 1923 (8 of 1923) in respect of his death of, or bodily injury to, any such employee- (a) engaged in driving the vehicle, or (b) if it is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicle, or (c) if its is a goods carriage, being carried in the vehicle, or (ii) to cover any contractual liability. Xx xx xx (2) Subject to the proviso to sub-section (1), a policy of insurance referred to in sub-section (1), shall cover any liability incurred in respect of any accident, up to the following limits, namely:- (a) save as provided in clause (b), the amount of liability incurred; (b) in respect of damage to any property of a third party, a limit of rupees six thousand: Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier. Xx xx xx (5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 10 insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons.”. 9. Reverting back to the instant case, as the deceased stepped into the shoe of the owner of the vehicle in question, therefore, the claimants cannot be stated to be third party for the purpose of awarding the compensation under the Act. The benefits of the insurance policy is restricted to the personal insurance cover to the owner and the personal accident cover is a contract between the insured and the insurer and only designed to give the benefit to the insured and not to the borrower. The LRs of the third party cannot claim the benefit of the death of the borrower.

10. In view of the above, the present appeal is allowed and the impugned award dated 9.12.2009, passed in MACT case RBT No.43 of 2008, is modified.

11. However, the claimants are entitled to get an amount of Rs.50,000/- as compensation under no fault liability provided under Section 140 of the Act. The Hon'ble Supreme Court in Eshwarappa @ Maheshwarappa and another Versus C. S. Gurushanthappa and another in Civil Appeal No.7049 of 2002, dated 18.08.2010 that a claim under Section 140 of the Act may be made not merely as in terms of the award but it could be even at the time of the final Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh FAO-1665-2010 (O&M) 11 disposal. It was also held in the same judgment that scheme of the Act is to relieve representatives of extraordinary hardship and that is why a non obstante clause is used in Section 140(5) of the MV Act.

12. The statutory amount deposited by the appellant at the time of filing the appeal be disbursed to the appellant. The amount already deposited by the appellant before the Tribunal, after disbursing the amount of Rs.50,000/- against “No fault liability”. to the claimants, be refunded to the appellant-Insurance Company. 10.2.2014 (JITENDRA CHAUHAN) gsv JUDGE Note: Whether to be referred to the Reporter?. Yes/No Shanker Gauri 2014.02.13 17:14 I attest to the accuracy and integrity of this document High Court Chandigarh


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