National Insurance Co.Ltd. vs Shagufta & Ors.

Barin Ghosh, C J.

A claim before the Motor Accidents Claims Tribunal, Srinagar succeeded. Appellant before us filed an appeal challenging the award made and

published by the Tribunal. The appeal having been dismissed, appellant is before us in the present letters patent appeal.

It was the contention of appellant before the Appellate Court, which has been repeated before us, that death by reason of the accident took

place in the year 1979 of a passenger of the insured bus and, accordingly, in terms of the provisions of the Motor Vehicles Act, 1939, the liability,

if any, of the appellant stood restricted to Rs. 5000 only. The Appellate Court found, as a fact, which is not being disputed before us, that the

appellant did not take a plea before the Tribunal that its liability is, thus, restricted. In the normal circumstances, if a plea is not taken, no amount of

evidence can be looked upon the same. In consequence thereof, even if the policy of insurance was before the Tribunal as a piece of evidence, we

are afraid, in the absence of a plea to that effect, the Tribunal could not come to a conclusion that the liability of the appellant was restricted to Rs.

5000.

The insurance policy, while limiting the liability of the appellant, provided as follows:

Limit of the amount of the Company's liability under Section III (i) in respect of any one accident such amount as is necessary to meet the

requirement of the Motor Vehicles Act, 1939"".

Clause (1) and sub clause (i) of Section II of the Policy is as follows:

Subject to the limits of liability, the Company will indemnify the insured against all sums including claimant's cost and expenses which the

Insured shall become legally liable to pay in respect of

(i) death of or bodily injury to any person caused by or arising out of the use (including the loading and/or unloading) motor vehicle.

The said clause has various sub clauses. Two of them, namely, sub clauses (b) and (c) restrict the liability of the appellant under Section 95 of

the Motor Vehicles Act, 1939 in respect of death of or bodily injury to any person in the employment of the insured and in respect of death of or

bodily injury to any person (other than a person carried by reason of or in pursuance of a contract of employment) being carried in or upon or

entering or mounting or alighting from the Motor Vehicle at the time of occurrence of the event. Section II, therefore, limited liability of the

appellant in respect of passengers of the insured vehicle. Appellant, at the same time, undertook upon itself, subject to the limits of liability, to meet

the liability of insured against all sums in respect of death of or bodily injury to any person caused by or arising out of the use of motor vehicle

concerned. It was, therefore, upto the appellant to meet the liability of insured against all sums or to the extent of the limit. It exercised the first

choice by not putting forward a contention that its liability is limited.

In the premises, the conclusion would be that the provisions of Subsection (2) of Section 95 of the Motor Vehicles Act, 1939, which no doubt

prescribed the minimum liability, could not be looked at while the claim was being considered by the Tribunal. A new evidence could be looked at

the appellate stage, but no new plea could be taken at that stage even on the basis of evidence already on record.

Learned counsel for the appellant cited a judgment of the Hon'ble Supreme Court in National Insurance Company Limited v. Keshav Bahadur

& ors., 2004 (2) SCC 370, where there was a specific dispute as to what was, if any, the maximum liability of insurance company. In that

background, the matter had been decided when the Hon'ble Supreme Court found, as a fact, that there was nothing on record which would

suggest that extra premium had been paid to obtain extra indemnity. As aforesaid, in the instant case, the plea of limitation of the liability was not

taken before the Tribunal. In the circumstances, this case is of no help to the appellant.

The appeal fails and the same is dismissed.