M/s Yash Construction Company vs Ntional Insurance Co. Ltd. & others

Chander Bhusan Barowalia, J.

1.The present appeal has been preferred by the appellant against the award dated 29.11.2012, passed by the learned Motor Accident Claims Tribunal-

II, Kangra at Dharamshala), (hereinafter referred to as ‘the Tribunal’) in MACP No. 58-G/2006, titled as Rakesh Kumar versus Ajeet Singh &

others, whereby compensation to the tune of 4,51,500/- with interest @ 7.5% per annum from the date of filing of the claim petition till its realization

was awarded in favour of the claimant and respondent No. 2-owner was saddled with liability (hereinafter referred to as ‘the impugned

award’).

In nutshell, the facts giving rise to the present appeal, are that Rakesh Kumar, S/o Shri Mast Ram, (for short ‘the claimant’) who was injured

in the accident, involving vehicle No. PB-03-E-0817, belonging to respondent No. 2 (hereinafter referred to as ‘the appellant’), being driven by

respondent No. 1-driver and insured with respondent No. 3-insurance company, has claimed compensation to the tune of `10,00,000/-.

As per the claimant, on 17.04.2006, at about 9.30 a.m., when he was coming on his motorcycle bearing registration No. PB-35-D-7908 from

Nadaun to Jawalamukhi and reached near Hanuman Mandir, a Tempo bearing registration No. PB-03-E-0817, being driven by respondent No. 1, in a

rash and negligent manner, came from the opposite side, struck against his motorcycle and caused the accident, in which he sustained grievous injuries

on his head and right leg. Thereafter, he felt unconscious and was brought to CHC Jawalamukhi, from where he was referred to RPMC,

Dharamshala and subsequently was taken to Orthonova Hospital, Jalandhar. He has incurred an expenditure to the tune of ` 1,33,325/- on account of

his treatment, medicines and traveling etc. Besides this, he has spent about ` 2.00 lacs as miscellaneous expenses for diet. The petitioner has further

averred that he has suffered permanent disability and before the accident, he used to run a goldsmith shop and was earning ` 15,000/- per month, but

due to permanent disability, he has become physically handicapped for his entire life and is unable to carry out his routine work.

The respondents resisted and contested the claim petition by filing their respective replies and denied the averments contained in the claim petition.

On the basis of the pleadings of the parties, following issues were framed by the learned Tribunal:

“1. Whether the respondent No. 1 was driving the vehicle No PB-03E-0817 rashly and negligently on 17.4.2006 and caused injuries to Rakesh

Kumar? …OPP

If issue No. 1 is proved in affirmative to what amount of compensation the petitioner is entitled and from whom? …OPP

Whether the respondent No. 1 was not holding valid and effective driving licence? …OPR

Whether the offending vehicle was being plied without valid route permit, fitness certificate and registration? …OPR

Whether the petition is bad for non joinder of necessary parties? . …OPR

Whether the petitioner was himself negligent in driving the motorcycle? …OPR

Relief.â€​

Learned Tribunal after deciding Issue No. 1 in affirmative, decided Issues No. 3 to 6 in negative, allowed the claim petition and held respondent No.

2-owner liable to 5 pay compensation to the claimant to the tune of `4,51,500/- alongwith interest @ 7.5% per annum from the date of filing of the

claim petition till its realization.

Feeling aggrieved by the impugned award passed by the learned Tribunal, respondent No. 2-owner has assailed the impugned award on the ground

that its liability has wrongly been fixed by the learned Tribunal, as the only ground, on which the liability has been fixed upon him, is that the offending

vehicle was not having route permit on the day of the accident.

Learned Counsel for the appellant has argued that the vehicle of the appellant was having route permit and it was fit to be plied at the relevant time.

He has further argued that as per the route permit, the vehicle in question was fit to be plied in the State of Punjab and on the relevant day, it was

being plied in the State of Himachal Pradesh and when the same was fit to be plied in the State of Punjab, it cannot be said that it was not fit to be

plied in the State of Himachal Pradesh. When the route permit is there, the Insurance Company is to be held liable to pay compensation to the

claimant. To support his contention, he has placed reliance upon the judgment rendered by the Hon’ble High Court of Karnataka, in case titled as

New India Assurance Co. Ltd. Versus Mahadevamma and another, reported in 2010 ACJ 1579 and the judgments delivered by the Hon’ble High

Court of Punjab and Haryana, in case titled as Hans Raj Chaudhary versus Nanhi Devi & others, reported in 2013 (4) ACJ 2183, in case titled as

Sunil Kumar versus Ramveer Singh & others, reported in 2014 (1) ACJ 265 and in case titled as Iffko Tokio General Insurance Company Ltd. Versus

Villa, (P&H), reported in 2016(2) PLR 747. The learned Counsel has prayed that the impugned award may be set aside and the Insurance Company

may be held liable to pay compensation amount to the claimant.

On the other hand, learned Counsel for the Insurer has argued that as there was no route permit to ply the said vehicle in the state of Himachal

Pradesh, it is the To support his contention, he has placed reliance on the judgment rendered by the Hon’ble Supreme Court in case titled as

National Insurance Company Ltd. Versus Challa Bharathamma and others, reported in (2004) 8 SCC 517.

In rebuttal, learned Counsel for the appellant has argued that the vehicle was otherwise fit to be plied and the Insurance Company is liable to

indemnify the owner. He has further argued that the present case is not a case of no route permit, but the case of permit for a particular route, at the

most.

In order to appreciate the rival contentions of the parties, I have gone through the record carefully and in detail.

The claimant, while appearing in the witness box as PW-1, has re-iterated the averments contained in the claim petition. He has examined PW-4

Manjeet Singh, who was an eye witness to the occurrence. He stated that on 17.04.2006, at about 9.30 a.m., when he was returning after paying

obeisance in Hanuman Temple, situated on Jawalajee-Nadaun road, a tempo bearing No. PB-03E-0817 loaded with stones, come from Jawalajee side,

which was being driven by respondent No. 1, rashly and negligently, and collided with the motor-cycle bearing registration No. PB-35 -D -7908, which

was being driven by the motorcyclist in a normal speed. In the said accident, the motor-cyclist sustained injuries. In his crossâ€"examination conducted

on behalf of respondents No. 1 & 2, he has denied that that the motorcyclist was driving the motor-cycle in a rash and negligent manner and in the

cross-examination conducted on behalf of respondent No. 3, he has denied that he was not present at the spot at the time of accident. The claimant

has also examined Dr. Vivek Karol, Medical Officer, Jawalamukhi, who stated that on 17.04.2006, he examined the complainant and issued MLC Ext.

PW-1/A and the injuries are possible in a road side accident. PW-3 Dr. Gurdarshan Gupta, Orthopedic Surgeon, Civil Hospital, Kangra has stated that

on 27.10.2007, he alongwith other members of the medical board, had examined the complainant and the board assessed 25% permanent disability

suffered by him and issued disability certificate Ext. PW-3/A. Dr. Harprit Singh, M.S. Mech (Ortho). Managing Director of Ortho Nova Hospital,

Jalandhar has stated that he examined the complainant and found that the petitioner has suffered fracture at two places and fracture of tibia and

hemorrhagic shock. He further stated that the petitioner remained admitted in the hospital w.e.f. 17.04.2006 till 30.04.2006 and during the said period,

he was operated upon for three times for fractures in leg and rod was also inserted in the femur and fixation of tibia.

On the other hand, respondents No. 1 & 2 have examined Yashpal, Proprietor of Yash Construction. He stated that vehicle No. PB-03-E-0817

belongs to his company and Ajeet Singh was employed as a driver on it. He further stated that at the time of employing Ajeet Singh as a driver on the

vehicle, he had taken his driving test. In his cross-examination on behalf of the petitioner, he has admitted that a case under Sections 279 & 337 IPC

was registered in Police station, Jawalamukhi against respondent No. 1-Ajeet Singh. In his cross examination on behalf of respondent No. 3-Insurance

Company, he has admitted that the vehicle was registered as Goods Carrier Vehicle. He further stated that before employing respondent No. 1 as

driver, he had taken his driving test. He further sated that driving licence of respondent No. 1 was sent to DTO Bhatinda for verification. Respondent

No. 3 has examined Shri Sarwan Kumar Dhiman, Assistant Manager as RW-2. He has stated that vehicle No. PB-03E-0817 was duly insured w.e.f.

13.05.2005 till 12.05.2006 and the accident had taken place on 17.04.2006, the date when the vehicle was insured with the Insurance Company. He

further stated that the route permit of the vehicle was of Punjab State and the vehicle was not having route permit of H.P. area and due to having no

route permit of Himachal area, there is a breach of insurance policy (Ext. RW2/A).

From the evidence on record, it is clear that the vehicle in question was not having route permit for being plied in the State of Himachal Pradesh

and it was being plied in the said State without route permit.

I will consider the law on this aspect of the matter.

Learned Counsel for the appellant has relied upon the judgment in case titled as New India Assurance Co. Ltd. Versus Mahadevamma and

another, reported in 2010 ACJ 1579, whereby the Hon’ble High Court of Karnataka, has held that since the Insurance Company has failed to

prove the factum with regard to whether the vehicle was being plied as a stage carriage at the time of accident, therefore, the Insurance Company is

liable to pay the compensation and even if, Insurance Company finds that the said vehicle is being plied as stage carriage, the permit would have been

held to be cancelled.

The aforesaid judgment is not applicable to the facts of the present case as in the present case, the Insurance Company has specifically proved

that the vehicle in question was being plied without route permit.

Learned Counsel for the appellant has also relied upon the judgment delivered by the Hon’ble High Court of Punjab and Haryana, in case titled

as Hans Raj Chaudhary versus Nanhi Devi & others, reported in 2013 (4) ACJ 2183. It is apt to reproduce para-2 of the aforesaid judgment herein:-

“2. Counsel appearing on behalf of the insurance company still insist that sections 66 and 69 of the Motor Vehicles Act set out the various terms of

permit and one of the terms is that the vehicle could traverse only within the area allowed in the permit. The language used in section 149 that sets out

the permissible defences employs the expression of user of a vehicle “for a purpose not allowed by the permitâ€. The purpose of the permit is not

the same thing as condition in the permit. The legislature has employed a language restricting it only to violation of purpose of permit. The Motor

Vehicles Act, being a beneficial legislation, the issue of liability should be interpreted to the benefit of claimant and to the extent to which the owner

obtains indemnity, it makes possible the prospect of recovery so much easier.

Reliance has also been placed by the learned Counsel for the appellant on a judgment rendered by the Hon’ble High Court of Punjab and

Haryana in case titled as Sunil Kumar versus Ramveer Singh & others, reported in 2014 (1) ACJ 265, on the same principle. It will be profitable to

reproduce para 4 of the aforesaid judgment herein: “4. Counsel for the insurance company argues that there had been no valid permit or fitness

certificate. These are no defences which shall be allowed for exclusion of liability under the terms of section 149 of the Motor Vehicles Act. The user

of the vehicle against the terms of permit under section 6 will give rise to other consequences of cancellation of permit but shall not avail to the insurer

a right to be xonerated, unless there are any specific exclusions under the terms of policy. The court’s finding that the liability shall be only on

respondent Nos. 1 and 2 is erroneous. The liability shall therefore be borne by the insurance company.â€​

Learned Counsel for the appellant has also placed reliance upon the judgment passed by the Punjab and Haryana High Court in case titled as Iffko

Tokio General Insurance Company Ltd. Versus Villa, (P&H), reported in 2016(2) PLR 747. herein: “6. The Tribunal considered this submission of

learned counsel for the appellant-Insurance Company and while relying upon the observations of this Court in case of National Insurance Company

Ltd. V. Rajender Giri and others, 2012 (2) RCR (Civil) 183 has held that if the offending vehicle involved in the accident was plied outside the

permissible area as per the route permit, it does not amount to violation of terms and conditions of the policy under Section 149(2) of the Motor

Vehicles Act.â€​

Though, the judgments relied upon by the Punjab and Haryana High Court, particularly in Iffco’s case, supra, have persuasive value, but in

view of the judgment passed by the Hon’ble Supreme Court in case titled as National Insurance Co. Limited versus Challa Bharathamma and

others, reported in (2004) 8 SCC 517, the same are not applicable to the facts of the present case. It is apt to reproduce paras 10 to 12 of the

aforesaid judgment, herein: “10 Similarly, in National Insurance Co. Ltd., Chandigarh v. Nicolletta Rohtagi and Ors. (2002 (7) SCC 456), the scope

of Section 149 (2) of the Act was elaborated. It was, inter alia, observed as follows: ""13. To answer the question, it is necessary to find out on what

grounds the insurer is entitled to defend/contest against a claim by an injured or dependants of the victims of a motor vehicle accident. Under Section

96(2) of the 1939 Act which corresponds to Section 149(2) of the 1988 Act, an insurance company has no right to be a party to an action by the

injured person or dependants of the deceased against the insured. However, the said provision gives the insurer the right to be made a party to the

case and to defend it. It is, therefore, obvious that the said right is a creature of the statute and its content depends on the provisions of the statute.

After the insurer has been made a party to a case or claim, the question arises, what are the defences available to it under the statute ? The language

employed in enacting sub- section (2) of Section 149 appears to be plain and simple and there is no ambiguity in it. It shows that when an insurer is

impleaded and has been given notice of the case, he is entitled to defend the action on grounds enumerated in the sub-section, namely, sub-section (2)

ofSection 149 of the 1988 Act, and no other ground is available to him. The insurer is not allowed to contest the claim of the injured or heirs of the

deceased on other ground which is available to an insured or breach of any other conditions of the policy which do not find place in sub-section (2)

ofSection 149 of the 1988 Act. If an insurer is permitted to contest the claim on other grounds it would mean adding more grounds of contest to the

insurer than what the statute has specifically provided for.

Sub-section (7) of Section 149 of the 1988 Act clearly indicates in what manner sub-section (2) ofSection 149 has to be interpreted. Sub-section

(7) of Section 149 provides that no insurer to whom the notice referred to in sub-section (2) or sub-section (3) has been given shall be entitled to avoid

his liability to any person entitled to the benefit of any such judgment or award as is referred to in sub- section (1) or in such judgment as is referred to

in sub-section (3) otherwise than in the manner provided for in sub-section (2) or in the corresponding law of the reciprocating country, as the case

may be. The expression ""manner"" employed in sub-section (7) of Section 149 is very relevant which means an insurer can avoid its liability only in

accordance with what has been provided for in sub- section (2) of Section 149. It, therefore, shows that the insurer can avoid its liability only on the

statutory defences expressly provided in sub-section (2) of Section 149 of the 1988 Act. We are, therefore, of the view that an insurer cannot avoid its

liability on any other grounds except those mentioned in sub-section (2) of Section 149 of the 1988 Act.

As was observed in the said case the statutory defences which are available to the insurer to contest the claim are confined to those provided in

sub-section (2) of Section 149.

High Court was of the view that since there was no permit, the question of violation of any condition thereof does not arise. The view is clearly

fallacious. A person without permit to ply a vehicle cannot be placed at a better pedestal vis-`-vis one who has a permit, but has violated any condition

thereof. Plying of a vehicle without a permit is an infraction. Therefore, in terms of Section 149(2) defence is available to the insurer on that aspect.

The acceptability of the stand is a matter of adjudication. The question of policy being operative had no relevance for the issue regarding liability of

insurer. High Court was, therefore, not justified in holding the insurer liable.â€​

In view of the ratio laid down by the Hon’ble Supreme Court in the judgment, supra, the judgments replied upon by the learned Counsel for the

appellant, are not applicable to the facts of the present case, as the Hon’ble Supreme Court has already settled the matter.

23 In view of this, as discussed hereinabove, the Hon’ble Supreme Court has already held in para 12 of the judgment (supra), passed by the

Hon’ble Supreme Court that non possession of route permit is totally violation of the terms and conditions of the Insurance Policy and so the

Insurance Company is not liable to indemnify the owner-insured. This Court finds that as the vehicle in question was being plied, in the preset case

also, against the terms and conditions of the Insurance Policy, therefore, there is a violation of the terms and conditions of the Insurance Policy and the

Insurance Company cannot be held liable to indemnify the owner-insured.

This Court after analyzing the material, which has come on record, comes to the conclusion that the Insurance Company cannot be held liable to

pay the compensation amount, as there was no route permit to ply the vehicle in question in the State of Himachal Pradesh, which is a clear violation

of the terms and conditions of the Insurance Policy. So applying the law, as settled by the Hon’ble Supreme Court in the aforesaid judgment, the

impugned award is to be upheld, the appeal preferred by the appellant is without merit and deserves to be dismissed. Accordingly, the impugned award

is upheld and the appeal is dismissed. In the peculiar facts and circumstances of the case, parties are left to bear their own costs.

25 Pending application(s), if any, also stands disposed of.

Send down the record after placing copy of the judgment on Tribunal's file.