National Insurance Co. Ltd. vs DEVAPPA F. KALYANI MAJOR

THIS appeal by the opposite party-The National Insurance Company is directed against the order dated 12.9.94 passed by the District Forum, Dharwad in Complaint No. 150/94 directing the opposite party-Insurance Company to pay a sum of Rs. 31,156/- with interest at 18% p.a. to the complainant.

THE facts, briefly stated, are as follows : THE complainant is the owner of a Mini bus bearing Registration No. KA. 26.243 which he had insured with the opposite party and during the currency of the said insurance the said bus met with an accident on 10.3.93 and sustained damages. THE complainant made claim with the opposite party but the opposite party repudiated the claim stating that the bus at the time of the accident was carrying excess passengers in violation of the policy conditions. THE complainant thereafter filed the complaint claiming compensation in a sum of Rs. 76,000/-. The opposite party filed its version and admitted that fact that the accident took place during the currency of the policy. It averred that the limitation as to the use of the vehicle was only to carry 12 passengers but at the time of the accident, it had carried more, that is 25-26 passengers and so the complainant had acted in violation of the policy conditions in carrying passengers and in that view, the opposite party averred that it was justified in repudiating the claim of the complainant.

During enquiry the parties filed their affidavits in evidence. The complainant got Exts. P1 to P11 marked in evidence and while the opposite party got Exts. Dl to D6 marked in evidence. The District Forum, on consideration of this material held that the Insurance Company the opposite party committed deficiency in service in repudiating the claim of the complainant on the ground that at the time of the accident it had carried excess passengers.

WE have called for the records and received. WE have also heard the learned Counsel for the appellant and perused the material on record. It is not disputed that the sea ting capacity of the said Mini bus was 12 passengers. It is also not disputed that the said bus at the time of the accident had carried 25-26 passengers. The policy condition as to the limitations as to use, in the policy Ex. C-1 reads as under : "The policy covers the use only under a permit within the meaning of Motor Vehicles Act, 1988 or such a carriage falling under Sub-section (3) of Section 66 of the Motor Vehicles Act, 1988."

THE National Commission considered this question in Gopal Dutt & Jaisingh v. THE Branch Manager, THE New India Assurance Co. Ltd. reported in III (1992) CPJ 59 (NC), wherein the National Commission while considering the facts has held as under : "THEre was a clear limitation under the law, namely, the Motor Vehicles Act that the vehicle shall be used only for carrying the permitted number of passengers, which, in the present case, was only 43. Inasmuch as at the time of occurrence of the accident the vehicle was carrying 127 passengers. It was clearly a case of the vehicle otherwise than the number permitted by the Act. In these circumstances, the Insurance Company is clearly absolved of liability under the policy by virtue of the general exception clause."

THErefore, it is clear that the complainant has acted in violation of the policy conditions in carrying excess passengers and so the Insurance Company was justified in repudiating the claim of the complainant. The District Forum, in the present case, relied upon a decision in B.V. Nagaraju v. M/s. Oriental Insurance Company Ltd., reported in III (1993) CPJ 1640 and held that the carrying of excess passengers at the time of the accident has nothing to do with the respondent''s liability to pay damages sustained by the bus. The principles laid down in the said decision by this Commission had not been upheld by the National Commission in First Appeal No. 439 of 1993 decided on 30.11.94, M/s. Oriental Ins. Co. Ltd v. B. V. Nagaraju which the District Forum has failed to consider. Therefore, the finding recorded by the District Forum is erroneous and unsustainable.

IN the result, therefore, this appeal is allowed. The order of the District Forum, Dharwad recorded in Complaint No. 150/94 is set aside and the complaint is dismissed. Appeal allowed.