Oriental Insurance Co. Ltd. vs Indu and Others

A.P. Chowdhri, J.—This revision is directed against the order dated November 12, 1990, of the Motor Accidents Claims Tribunal, Chandigarh, dismissing the petitioner''s application u/s 110-C (2-A) of the Motor Vehicles Act, 1939.

Indu filed a petition for compensation on account of the injuries suffered by her in an accident against owner and driver of scooter No. CHJ 7983 and the Oriental Insurance Co. Ltd., being the insurer of the owner of the scooter. The owner Om Nagpal, respondent No. 1 in the main petition, failed to appear in spite of service. Kamaljit Kumar, alleged driver of the scooter, respondent No. 2 in the main petition, filed a written statement admitting the accident but denying his liability by giving a counter version. An application was made by the insurance company for permission to contest the petition. It was held that the mere admission of the accident with a counter version in denial of the negligence did not amount to collusion of the claimant with the owner and, therefore, there was merit in the application. Section 110-C (2-A) of the Motor Vehicles Act, 1939, reads as under:

(2-A) Where in the course of any inquiry, the Claims Tribunal is satisfied that-

(i) there is collusion between the person making the claim and the person against whom the claim is made, or

(ii) the person against whom the claim is made has failed to contest the claim, it may, for reasons to be recorded by it in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaded as a party to the proceeding and the insurer so impleaded shall thereupon have the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made.

The above provision empowers the Tribunal to permit the insurer to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made, if one of the two conditions laid down in Clauses (i) and (ii) is fulfilled. The condition in Clause (i) is collusion between the claimant and the person against whom the claim is made. In Clause (ii) the condition is that the person against whom the claim is made has failed to contest the claim. Whereas the learned Tribunal has recorded a finding with regard to Clause (i) above, it has altogether failed to consider the application in so far as Clause (ii) is concerned. Admittedly, the owner against whom the claim petition has been made has failed to contest the claim, in that he has been proceeded ex pane. The Claims Tribunal has thus acted in exercise of its jurisdiction illegally or with material irregularity u/s 115 of the Code of Civil Procedure.

The revision petition is accordingly allowed and the order of the Claims Tribunal is set aside. The application made by the insurance company is allowed and it is permitted u/s 110-C (2-A) of the Motor Vehicles Act, 1939, to contest the claim petition on all the grounds available to the owner of the vehicle, respondent No. 1 in the main petition. As in spite of service no one has appeared for the respondents to oppose the above revision petition, there will be no order as to costs. Records of the trial court be returned.

The petitioner through counsel is directed to appear before the Claims Tribunal on September 10, 1991, for further proceedings according to law.