Hemraj and Others vs New India Assurance Company

S.K. Keshote, J.—The learned Single Judge, under the impugned order, dated 25.1.1994, decided three S.B. Civil Miscellaneous Appeal Nos. 270/1988,271/1988 and 154/ 1988 and felt dissatisfied and aggrieved of that order the claimant-appellants in S.B. Civil Miscellaneous Appeal Nos. 270/1988 and 154/1988 have preferred these two appeals.

The appeals before the learned Single Judge were filed against the common award, dated 29.1.1988 of the learned Motor Accident Claims Tribunal, Jaipur, in three Claim Case Nos. 251 /85,252/1985 and 253/1985. Since the order impugned in these appeals is common and the matters arise out of the same accident, the appeals are taken up for hearing together and being decided by this common order.

The learned Tribunal, under its award dated 29.1.1988, awarded a sum of Rs. 2,28,640 as compensation in favour of the claimant-appellants in D.B. Special Appeal (Civil) No. 71/1994 and a sum of Rs. 2,36,320 in favour of the claimant-appellants in D.B. Special Appeal No. 15/1996.

Briefly stated the facts of the cases are that three persons, including two deceased, were going on a motorcycle No. RRG 1189 to Jaipur from Bassi. It was being driven by deceased Hempal. They were on the right side of the road. When the motorcycle was near the octroi outpost, truck No. RNB 1677 came rashly and negligently from the opposite direction and struck the motorcycle and that resulted in the death of all the three riders thereon. The learned Tribunal made the New India Assurance Company Limited, Jaipur, the insured of the offending truck, liable for payment of the entire amount of compensation.

The grievance has been made by the non-claimant-respondent, the New India Assurance Company (for short, ''the respondent-Insurance Company'') before the learned Single Judge that in view of the provisions of Section 95(2)(a) of the Motor Vehicles Act, 1939 (for short, ''the Act, 1939''), as then existed, it was liable to pay the compensation to the extent of Rs. 1,50,000 in the case. This contention raised by the respondent-Insurance Company found favour and accordingly the learned Single Judge allowed the appeals of the respondent-Insurance Company and restricted its liability to pay the compensation to the claimants to the extent of Rs. 1,50,000 in each case, hence these appeals by the claimant-appellants before us.

Heard learned Counsel for the parties and perused the entire record of the miscellaneous appeals, special appeals and the learned Tribunal.

The learned Counsel for the respondent-Insurance Company does not dispute that though the statutory liability to pay the compensation to the third party in the case of the accident caused by the truck insured by it, was to the extent of Rs. 1,50,000 at the relevant time but there is no bar that the respondent-Insurance Company may undertake to make its liability unlimited. The deceased were third party in the matter. They were not the contracting party in the matter to the Insurance Company or the truck. It was a bilateral agreement between the insured and the insurer. Whether the policy was act policy or thereunder the unlimited liability to pay the compensation is of the Insurance Company, is a question of fact. The respondent-Insurance Company did not seriously press this point before the learned Tribunal and rightly so because it had not produced the insurance policy of the offending vehicle.

Before the learned Single Judge, though this point was pressed, the learned Counsel for the respondent-Insurance Company did not dispute that the insurance policy was not produced even in the appeal. The learned Single Judge proceeded with reference to the provisions contained in Section 95(2)(a) of the Act, 1939 but this provision could have been made applicable to the case in hand, only in case the respondent-Insurance Company would have established to the satisfaction of the Court that it has not undertaken unlimited liability to pay the amount of compensation in the motor vehicle accident in the case of death or bodily injury suffered. The respondent-Insurance Company has withheld the material and relevant document and thereby legitimately an adverse inference can be drawn against it, had the same been produced, it would have gone against it.

The learned Counsel for the respondent-Insurance Company has led much emphasis on the point that the owner of the offending truck possessed the insurance policy and he has not produced. It is difficult to appreciate what to say to accept this contention of the learned Counsel for the respondent-Insurance Company. The Motor Vehicles Act is a beneficial piece of legislation and thereunder the provisions are made for compulsory insurance for act only of the motor vehicles for the object and purpose that the dependents of the victims or the injured of the accident may get compensation. The respondent-Insurance Company is in possession of relevant and material documents of the insurance of the offending truck; it could have produced those documents before the learned Tribunal or before the learned Single Judge or before us but it has not been done. Reference fruitfully may have to the decision of the Hon''ble Supreme Court in the case of National Insurance Co. Ltd., New Delhi Vs. Jugal Kishore and Others, . There the Hon''ble Supreme Court held.

A perusal of the policy, therefore, indicates that the liability undertaken with regard to the death or bodily injury to any person caused by or arising out of the use (including the loading and/or unloading) of the motor vehicle falling u/s ll(l)(i) has been confined to "such amount as is necessary to meet the requirements of the Motor Vehicles Act, 193 9." This liability, as is apparent from Clause (b) of Sub-section (2) of Section 95 of the Act, was at the relevant time of Rs. 20,000 only. The details of the premium also indicate that no additional premium with regard to a case falling u/s 11 (1)(i) was paid by the owner of the vehicle to the Insurance Company. It is only the vehicle which was comprehensively insured, the insured''s estimate of value including accessories (I.E.V.) thereof having been shown at Rs. 40,000. In this view of the matter the submission made by learned Counsel for the respondents that the appellant had in the instant case undertaken an unlimited liability does not obviously have any substance. The liability under the policy in the instant case was the same as the statutory liability contemplated by Clause (b) of Sub-section (2) of Section 95 of the Act namely Rs. 20,000. An award against the appellant could not, therefore, have been made in excess of the said statutory liability.

Learned Counsel for the appellant then urged relying on the decision of this Court in British India General Insurance Co. Ltd. Vs. Captain Itbar Singh and Others, that in view of Sub-section (6) of Section 96 of the Act no insurer to whom the notice referred to in Sub-section (2) thereof has been given, is entitled "to avoid his liability" to any person entitled to the benefit of any such judgment as is referred to in Sub-section (1) thereof otherwise than in the manner provided for in Sub-section (2). On this basis it was urged that the appellant was not entitled to assert that its liability was confined to Rs. 20,000 only inasmuch as this is not one of the defences specified in Sub-section (2) of Section 96 of the Act. We find it difficult to agree with this submission either. Firstly, in paragraph 12 of the report of this very case it has been held that Sub-section (2) of Section 96 in fact deals with defences other than those based on the conditions of a policy. Secondly, from the words "to avoid his liability" used in Sub-section (6) of Section 96 it is apparent that the restrictions placed with regard to defences available to the insurer specified in Sub-section (2) of Section 96 are applicable to a case where the insurer wants to avoid his liability. In the instant case the appellant is not seeking to avoid its liability but wants a determination of the extent of its liability which is to be determined, in the absence of any contract to the contrary, in accordance with the statutory provision contained in tins behalf in Clause (b) of Sub-section (2) of Section 95 of the Act. In the instant case since as seen above the appellant did not undertake in the policy any liability in excess of the statutory liability the award against it could be only in accordance with the said statutory liability.

Before parting with the case, we consider it necessary to refer to the attitude often adopted by the Insurance Companies, as was adopted even in this case, of not filing a copy of the policy before the Tribunal and even before the High Court in appeal. In this connection what is of significance is that the claimants for compensation under the Act are invariably not possessed of either the policy or a copy thereof. This Court has consistently emphasized that it is the duty of the party which is in possession of a document which would be helpful in doing justice in the cause to produce the said document and such party should not be permitted to take shelter behind the abstract doctrine of burden of proof. This duty is greater in the case of instrumentalities of the State such as the appellant who are under an obligation to act fairly. In many cases even the owner of the vehicle for reasons known to him does not choose to produce the policy or a copy thereof. We accordingly wish to emphasise that in all such cases where the Insurance Company concerned wishes to take a defence in claim petition that its liability is not in excess of the statutory liability it should file a copy of the insurance policy along with its defence. Even in the instant case had it been done so at the appropriate stage necessity of approaching this Court in civil appeal would in all probability have been avoided. Filing a copy of the policy, therefore, not only cuts short avoidable litigation but also helps the Court in doing justice between the parties. The obligation on the part of the State or its instrumentalities to act fairly can never be over emphasised.

In the absence of these documents the learned Single Judge has committed an error to take the liability of the respondent-Insurance Company Limited to pay the compensation in these matters.

Considering the matter from any angle and aspect in our opinion, in these cases the relief is to be granted in favour of the claimant-appellants.

As a result of the aforesaid discussion, both the appeals succeed and the same are allowed. The impugned order, dated 25.1.1994, of the learned Single Judge, in S.B. Civil Miscellaneous Appeal Nos. 154/1988 and 270/1988, is quashed and set aside, and the award of the learned Tribunal is upheld.

In the facts of this case there shall be no order as to costs.