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Judgment
201 paragraphs · 4,326 wordsMFA No.23745/2010 has been preferred by the appellant/insurer and MFA Crob. No.100195/2014 has been preferred by the cross-
objectors/claimants being aggrieved by the judgment and award passed by the Civil Judge (Sr.Dn) and M.A.C.T., Gangavathi in MVC No. 329/2008
dated 15.06.2009.
Heard. Both the cases are admitted and with the consent of the learned counsel appearing for the parties, they are taken up for final disposal.
For the sake of convenience the parties are referred to as per their ranking before the Tribunal.
The brief facts as averred in the claim petition are that on 25.05.2008 at about 4.00 p.m., Khajasab was proceeding on a motorcycle bearing
registration No.KA-36/Q-8857 from Venkateshwar camp to Gorebal Camp and when he came near Gorebal Camp KPTCL sub-station, he lost
control over the motorcycle and caused accident by hitting to the curbstone fixed by the side of the road. As result of the same, he suffered grievous
injuries and succumbed to the injuries on the spot. It is further contended that the deceased was an agriculturist and was earning Rs.3,300/- per month.
For having lost the bread earner, the wife, children and the mother of the deceased have filed a claim petition claiming compensation under Section
163-A of the Motor Vehicles Act.
In spite of service of notice, respondent No.1 did not appear before the Tribunal and he was placed exparte. In response to the notice, respondent
No.2/insurer appeared before the Tribunal and filed his written statement. By denying the contents of the claim petition he further contended that the
deceased was not holding valid and effective driving licence to ride the motorcycle at the time of the accident. He further contended that the
compensation claimed by the claimants is exorbitant and there is a breach of terms and conditions of the policy and as such, he is not liable to pay any
compensation.
On the basis of the above pleadings, the Tribunal framed the following issues;
Whether petitioners prove that on 25.05.2008 at about 4.00 pm on Sindhanoor-Gangavathi main road, near Gorebal camp, Khajasab was died in a
motor vehicle accident i.e., on account of riding of the motor cycle TVS Star bearing No.KA-36/Q-8857 by the deceased?
Whether the petitioners prove that they are entitled for the compensation? Form whom, to what extent?
What order?
In order to prove their case, petitioner No.3 got examined himself as P.W.1 and got marked documents as per Ex.P1 to 8. The respondents have
not led any evidence on their behalf.
After hearing the parties to the lis, the impugned judgment and award came to be passed by the Tribunal. Assailing the same the appellant/insurer
as well as cross-objectors/claimants are before this Court.
The main grounds urged by the learned counsel appearing for the appellant/insurer are that the deceased, on his own fault, has caused the accident
and he himself is a tortfeasor who stands on the footing of the owner and as such the petition is not maintainable and the appellant/insurer is not liable
to indemnify any loss. He further contended that the deceased borrowed the motorcycle from its real owner and no tortfeasor is involved in the
alleged accident. He further contended that the person who was driving the vehicle after borrowing it from its owner and if he meets with an accident
without involvement of any other vehicle, then he will be stepping into the shoes of the owner and in that light the claim petition is not maintainable. In
order to substantiate the said fact, he has relied upon the decision in the case of Ningamma and another v. United India Insurance Company Ltd,
reported in 2009 ACJ 2020 and he also relied upon the decision of the Hon’ble Division Bench in the case of Oriental Insurance Co. Ltd v.
Sharada G and others, reported in 2010 ACJ 977. He further contended that the deceased was not a third party and there is no provision wherein an
insured may claim compensation from himself. Under such circumstances, the Tribunal has erred in awarding the compensation. In order to
substantiate his said contention, he relied upon the decision in the case of New India Assurance Company Limited v. Sadanand Mukhi and others
reported in 2009 ACJ 998. On these grounds, he prayed for allowing the appeal by setting aside the impugned judgment and award passed by the
Tribunal.
Per contra, the learned counsel appearing for the cross-objectors/claimants has vehemently argued by contending that the compensation awarded
by the Tribunal is on the lower side and even the compensation awarded under the conventional heads is also on the lower side. He further contended
that no reliable evidence has been produced by the appellant/insurer to establish that the deceased being the rider of the motorcycle steps into the
shoes of the owner. When the claimants have proved that the deceased died due to the accident in which vehicle was insured with the insurer, and
then under such circumstances, the appellant/insurer is liable to pay the compensation. In order to prove the said fact, the learned counsel for the
cross-objectors/claimants has relied upon the decision in the case of The Oriental Insurance Company Limited v. Shilpakala and others reported in
2014 (3) AKR 565. He further contended that when an application is filed under Section 163-A of the Motor Vehicles Act, it is not necessary to prove
rash and negligent act on the part of the driver/owner of the vehicle and it is no fault liability. He further contended that the compensation awarded by
the Tribunal is on the lower side and in that light the insurer cannot have any discretion in this behalf. He further contended that the cross-
objectors/claimants are not required to plead or establish that the death or permanent disability in respect of which the claim has been made was due
to any wrongful act or negligence or default on the part of the driver/owner of the vehicle is concerned. In order to substantiate the said fact, he relied
upon the decision in the case of Reshma Kumari and others V. Madan Mohan and another reported in 2013 ACJ 1253. Keeping in view the above
said facts and circumstances, he prays for dismissal of the appeal filed by the appellant/insurer and allowing the cross-objection.
Before considering the cross-objections filed by the cross-objectors/claimants for enhancement of compensation, since the insurance company is
questioning its liability and contending that the claim petition under section 163-A of the Motor Vehicles Act is not maintainable on the ground that the
accident occurred due to negligence on the part of the rider of the motorcycle and he stepped into the shoes of the owner and in that light the insurer
is not liable to pay any compensation, in the light of the said submission, I have to consider the maintainability of the claim petition in the first instance.
The learned counsel for the insurance company by relying upon the decision in the case of Ningamma and others v. United Insurance Company
Limited, (quoted supra), and another decision in the case of New India Assurance Company Limited v. Sadanand Mukhi and others (quoted supra)
contended that the claim was not maintainable as there was no tortfeasor involved and the deceased stepped into the shoes of the owner and in that
light he himself is a tortfeasor and claim petition is not maintainable in this behalf. He further contended that in view of the decision quoted supra, the
widow, children and the mother are not entitled to claim any compensation. For the purpose of clarity, I quote para 13, 18, 19 and 20 of the decision in
the case of Ningamma and another v. United India Insurance Co. Ltd., (quoted supra) which reads as under;
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 the 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 legal representative? Before dwelling further, it would be useful to discuss the relevant provisions of
Sections 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 or 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.
xxx xxx xxx
(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.
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
(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...â€
In the case of Oriental Insurance Company Ltd. v. Rajni Devi , 2008 ACJ 1441 (SC), wherein one of us, namely, Hon'ble Justice S.B. Sinha was
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 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.
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 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 the shoes
of the owner of the motor vehicle could not have claimed compensation under Section 163-A of the MVA.
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
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 requirements 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) insures 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;
(i) 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-to cover liability in respect of the death, arising out of 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 the 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 it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability. xxx xxx xxx
(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.
xxx xxx xxx
(5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of 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.â€
Further, in the case New India Assurance Company Limited v. Sadanand Mukhi and others (quoted supra) in paragraphs - 14 and 20, it has been
observed as under;
It is not a case where even Section 163-A of the Act was resorted to. Respondents filed an application under Section 166 of the Act. Only an act
policy was taken in respect of the motor vehicle. Submission of the learned counsel that being a two wheeler, the vehicle was more prone to accident
and, therefore, whosoever becomes victim of an accident arising out of the use thereof would come within the purview of the term ""a person"" as
provided for in Section 147 of the Act, in our opinion, is not correct.
In view of the aforementioned authoritative pronouncements, we have no hesitation of hold that the insurance company was not liable. The
impugned judgment, therefore, cannot be sustained. It is set aside accordingly. The appeal is allowed. No costs.
In the light of the aforesaid submissions, the question that falls for my consideration is, whether the legal representatives of the deceased person,
who was riding the motorcycle after borrowing it from the real owner meets with an accident without involvement of any other vehicle, would be
entitled to claim compensation under Section 163-A of the Motor Vehicles Act?
There is no dispute with regard to the manner in which the accident occurred in the present case. Both the parties have admitted that the
deceased was riding the motorcycle at the time of the accident. Another point that arises for consideration of this Court is whether in a claim
proceeding under Section 163-A of the Motor Vehicles Act, is it open for the insurer to raise a defence by holding that the deceased stepped into the
shoes of the owner and he is not liable to pay any compensation?
This proposition of law has been elaborately discussed and decided by the Hon’ble Apex Court in the case of United India Insurance
Company Ltd., v. Sunil Kumar and another reported in (2014) 1 Supreme Court Cases 680, therein at paragraphs 13 and 14 it has been observed as
under;
We are, therefore, of the view that liability to make compensation under Section 163-A is on the principle of no fault and, therefore, the question as
to who is at fault is immaterial and foreign to an enquiry under Section 163-A. Section 163-A does not make any provision for apportionment of the
liability. If the owner of the vehicle or the insurance company is permitted to prove contributory negligence or default or wrongful act on the part of
the victim or claimant, naturally it would defeat the very object and purpose of Section 163-A of the Act. Legislature never wanted the claimant to
plead or establish negligence on the part of the owner or the driver. Once it is established that death or permanent disablement occurred during the
course of the user of the vehicle and the vehicle is insured, the insurance company or the owner, as the case may be, shall be liable to pay the
compensation, which is a statutory obligation.
We, therefore, find ourselves unable to agree with the reasoning of the Two-Judge Bench in Sinitha’s case (supra). Consequently, the matter
is placed before the learned Chief Justice of India for referring the matter to a larger Bench for a correct interpretation of the scope of Section 163-A
of the Motor Vehicles Act, 1988, as well as points (iii) to (v) referred to in Shila Datta’s case.
Further in the case of United India Insurance Company v. Sunil Kumar and another reported in AIR 2017 SC 5710, therein the Hon’ble Apex
Court has observed that the compensation awarded under structured formula basis is in the nature of a final award and adjudication thereunder is
required to be made without any requirement of any proof of negligence of the driver/owner of vehicle of vehicle/s involved in the accident. By
observing as stated above, the question has been answered by holding that in a proceeding under Section 163-A of the Motor Vehicles Act, it is not
open for the insurer to raise any defence of negligence on the part of the victim himself. When the Hon’ble Apex Court has held that the insurer
will not be having any option and he cannot raise any defence with regard to negligence on the part of the victim himself, then under such
circumstances, the contention raised by the learned counsel appearing for the appellant/insurer that the deceased himself has contributed to the alleged
accident and he is a tortfeasor and he stepped into the shoes of the owner and he is not liable to pay any compensation does not have any force in law
and the same is rejected. Though the above said decisions quoted by the learned counsel for the insurer are also on the same effect, but in the
subsequent decisions, this proposition of law has been referred to the Larger Bench. In the light of the question raised, the Hon’ble Apex Court
has come to the conclusion that the insurer is not having any defence in this behalf and as such the insurer is made liable to pay the compensation.
Be that as it may, as could be seen from the judgment and award passed by the Tribunal, though the insurer has contended in his appeal memo
that the deceased himself is a tortfeasor and he stepped into the shoes of the owner and hence, he is not liable to pay any compensation, he has not led
any evidence and he had not stepped into the witness box to substantiate his contention. Always the heavy burden lies on the insurer to prove his
contentions. Even during the course of arguments, the learned counsel for the appellant/insurer candidly admitted that the records does not disclose
any such evidence to show that the deceased stepped into the shoes of the owner and secondly that the insurer is not having any right to challenge
that the deceased himself is a tortfeasor and that issue cannot be raised. It is well established principles of law that in a claim petition under Section
163-A of the M.V. Act, it is sufficient if the claimant establishes the fact that the deceased died as a result of the accident in which the vehicle was
involved and he need not prove the rash and negligent act on the part of any other persons. When there is a settled proposition of law, then under such
circumstances, the insurer cannot raise any defence in this behalf and he is liable to pay the compensation.
Keeping in view the above said facts and circumstances, the contention taken up by the learned counsel appearing for the appellant/insurer is not
sustainable in law and same is rejected.
As could be seen from the judgment and award passed by the Tribunal, the Tribunal has awarded an amount of Rs.3,60,000/- towards loss of
dependency, Rs.2000/- towards loss of estate, Rs.2,500/- towards funeral expenses and Rs.5,000/- towards loss of consortium. The method adopted
by the Tribunal is in accordance with Section 163-A of the Motor vehicles Act. The second schedule attached to the Act prescribes the said
multipliers and the compensation under the conventional heads. Keeping in view the above said facts, I come to the conclusion that the Tribunal has
rightly awarded the compensation. The cross-objectors/claimants have not made out any good grounds so as to enhance the compensation awarded by
the Tribunal.
In view of the above said facts and circumstances, the appellant/insurer as well as the cross-objectors/claimants have not made out any good
grounds to interfere with the judgment and award passed by the Tribunal and as such, the appeal and the cross-objection are liable to be dismissed and
accordingly, appeal as well as cross-objection is dismissed as devoid of merits.
The amount in deposit, if any, may be transmitted to the jurisdictional Tribunal, forthwith.