The Branch Manager, National Insurance Company vs Noor Topu Rathod

A.S. Pachhapure, J.—The appellant has approached this Court, challenging its liability to pay the compensation to the respondents 1 and 2 i.e., the legal representatives of deceased Ulhas, who died due to the injuries sustained in a motor vehicle accident while riding the motorcycle bearing reg. No. KA-28/R-5635.

The facts relevant for the purpose of this appeal are as under:

The parties will be referred to as per their rank before the Tribunal, for the sake of convenience.

Respondents 1 and 2 herein are the petitioners and the parents of deceased Ulhas, who made a claim for compensation for the death of their son-Ulhas. On 24.07.2007 at 2.00 p.m., Ulhas was riding the aforesaid motorcycle and he fell down on the road due to skidding of the motorcycle and died in the hospital while under treatment for the injuries sustained in the accident. His parents made a claim for compensation under Section 163-A of the Motor Vehicles Act [hereinafter referred to as "the Act" for short]. Respondent No. 1 herein is the owner of the motorcycle and the appellant is its insurer.

The appellant filed its written statement contending that a claim under Section 163-A of the Act cannot be maintained as the accident was due to the negligence of the deceased himself. On the aforesaid grounds, they sought for dismissal of the claim petition.

During the enquiry, P.W.1 i.e. the 1st petitioner was examined as P.W.1 and in his evidence, documents Exs. P1 to 19 were marked. On behalf of the insurer, R.W.1 was examined and in his evidence Ex. R1-insurance policy was marked.

The Tribunal after hearing the counsel for the parties and on appreciation of the evidence on record, allowed the claim petition and awarded a sum of Rs. 4,36,500-00 as a compensation with interest at 6% p.a., directing the appellant/insurer to pay the entire compensation. Aggrieved by the said Judgment and Award, the present appeal is filed.

I have heard learned counsel for both the parties.

The point that arises for my consideration is;

Whether the insurer is liable to indemnify the owner of the vehicle and whether a claim under Section 163-A of the Act could be maintained?

Learned counsel for the appellant submits that as the accident in question was due to the negligence of the deceased himself, the claim under Section 163-A of the Act cannot be maintained. It is his submission that deceased Ulhas steps into the shoes of the owner and because of his negligence the accident occurred and the provisions of Section 163-A of the Act are not attracted. Therefore, he submits that the Tribunal committed an error in holding that the appellant-Insurance Company is responsible to indemnify the owner. It is his alternate submission that the policy for a sum of Rs. 1,00,000-00 payable, for the death and at the most the legal representatives are entitled to the said sum. On these grounds, he sought for setting aside the impugned Judgment and Award.

On the other hand, learned counsel For respondents 1 and 2 submits that Section 163-A of the Act is a special provision incorporated under the Motor Vehicles Act and the liability of the insurer is irrespective of any default or negligence on the part of the deceased. He submits that under the policy, the insurer has taken responsibility to pay the compensation and therefore, the Tribunal was justified in imposing the liability on the insurer.

A reference was made by learned counsel for the claimants to the provisions under Section 163-A of the Act, which were introduced in the Act for the first time by Act No. 54 of 1994 with effect from 14.11.1994. The provisions contemplate that the owner of the motor vehicle or its authorized insurer is liable to pay the compensation for the death or permanent disablement due to the accident arising out of the user of the motor vehicle notwithstanding anything contained under the provisions of the Motor Vehicles Act or under any other law. Learned counsel submits that this provision prevails over any other law and also the provisions of the Motor Vehicles Act. He submits that Ulhas [deceased] was riding the motorcycle and the accident was not due to his negligence and therefore, it is his contention that the insurer is liable to indemnify the owner.

The aforesaid-provisions of Section 163-A of the Act was taken into consideration by the Apex Court in a decision reported in Deepal Girishbhai Soni and Others Vs. United India Insurance Co. Ltd., Baroda, ; wherein the Apex Court while referring to the provisions of Section 163-A and 167 of the Act and the Workmen''s Compensation Act, has held as under:

"66. We may notice that section 167 of the Act provides that where death of, or bodily injury to, any person gives rise to claim of compensation under the Act and also under the Workmen''s Compensation Act, 1923, he cannot claim compensation under both the acts. The Motor Vehicles Act contains different expressions as, for example, ''under the provision of the Act'', ''provisions of this Act'', ''under any other provisions of this Act'' or ''any other law or otherwise''. In Section 163-A, the expression "notwithstanding anything contained in this Act or in any other law for the time being in force" has been used, which goes to show that Parliament intended to insert a non obstante clause of wide nature which would mean that the provisions of section 163-A would apply despite the contrary provisions existing in the said Act or any other law for the time being in force. Section 163-A of the Act covers cases where even negligence is on the part of the victim. It is by way of an exception to section 166 and the concept of social justice has been duly taken care of."

The Apex Court was of the opinion that Section 163-A of the Act is an exception to Section 166 and covers cases where even negligence is on the part of the victim himself. Relying upon the principles laid-down in the aforesaid Judgment, it is the contention of learned counsel for respondents 1 and 2 that despite the fact of negligence on the part of the deceased, the legal representatives of the deceased are entitled to the compensation.

Now, to consider the substance of the facts relating to the accident in question. Ex. P1 is the FIR, Ex. P2 is the complaint and the claimants have also produced spot mahazar-Ex. P3. The contents of the complaint would reveal that on the date of the accident, the 3rd respondent had bought the new Hero Honda Splendor motorcycle and for the purpose of trial Ulhas [deceased] took the said vehicle from its owner for a ride and was proceeding on it. It is at that time, the vehicle skidded and due to a fall, Ulhas sustained severe injuries and died in the hospital while under treatment. The contents of the FIR would reveal that a complaint for the offence of rash and negligent driving was registered by the Police and a spot-mahazar was also drawn during the investigation. Though learned counsel vehemently contends that the skidding of the vehicle may be due to bad road with ditches. If it is the grievance against the formation of the road, it is the authority concerned who have to indemnify the legal representatives for the death as it is the State to take the responsibility and I do not think that such a claim could be maintained in a petition under Section 163-A of the Act.

The Apex Court had an occasion to consider a similar circumstance in a decision reported in Ningamma and Another Vs. United India Insurance Co. Ltd., . The Division Bench of the Apex Court while interpreting the provisions of Section 163-A of the Act have held "whether legal representative of a person, who was driving a motor vehicle, after borrowing it from a real owner met with an accident without involving any other vehicle was entitled for compensation under Section 163-A of the Act held "no". Persons like deceased would step into shoes of the owner of the vehicle, the Apex Court held that provision is absolutely clear and a claim under Section 163-A of the Act was held to be not maintainable. The Apex Court also took into consideration the Full Bench Judgment referred to supra in Deepal Girishbhai Soni''s case. In para 15, the Apex Court referred to the decision of Deepal Girishbhai Soni Vs. United India Insurance Co. Ltd. and laid-down the aforesaid principle. It is no-doubt true that the Judgment in Deepal Girishbhai Soni''s case is the Full Bench Judgment, in the later decision, it was referred to and distinguished and ultimately it was held that the deceased, who was negligent cannot make a claim for compensation under Section 163-A of the Act.

The basic principle of awarding compensation is the law of torts. The statute which have been enacted by either State or ''Parliament are basically founded the common law. Under the law, a person who voluntarily invites danger and sustains injury cannot make a claim for compensation for such injuries sustained in the context of the aforesaid principle. The only exception is Section 145 of the Act.

Later, the Apex Court also considered the provisions of Section 163-A of the Act in the decision reported in National Insurance Company Ltd. Vs. Sinitha and Others, . The Apex Court considered the provisions of Section 166 and 163-A of the Act and also took into consideration the provisions of the Motor Vehicles Act.

It is relevant to note that Section 140 of the Act provides compensation to the legal representatives of the deceased person/s and the victim under the principle of no fault liability under Chapter X of the Act, whereas the provisions of Section 163-A is under Chapter XI "insurance of motor vehicle against the third party risk" So, the question of applying the provisions of Section 163-A of the Act arises only in cases where there is a question to consider the third party risk. If a owner, who drives or rides a vehicle and an accident occurs due to his/her own negligence, such a claim would not fall within Section 163-A of the Act as it refers only against the claim of third party risk. If the Parliament had intended to grant compensation irrespective of negligence of the deceased or the injured, it could have incorporated such a provision under Chapter X, wherein a specific provision has been made under Section 140 of the Act-Liability without fault in certain cases. It is this aspect of the matter which has been considered by the Apex Court in the decision reported in National Insurance Company Ltd. Vs. Sinitha and Others, . Having referred to both the Chapters of the Motor Vehicles Act, the Apex Court held that a claim under Section 163-A of the Act cannot be maintained either by the owner of the vehicle or its employee or agent and in the earlier decision i.e., Ningamma''s case, the Apex Court held that the agent or an employee steps into the shoes of the owner and therefore Section 163-A of the Act cannot be maintained. So, in view of the later decisions of the Apex Court in Ningamma Vs. United India Insurance Co. Ltd., and National Insurance Company Ltd. Vs. Sinitha and others, a claim under Section 163-A of the Act cannot be maintained in case if the negligence is on the part of the rider or the injured as the case may be if he/she does not fall within the category of third party. This reference was not made while considering the principle in the Full Bench decision of the Deepal Girishbhai Soni Vs. United India Insurance Co. Ltd. The very question later came for consideration of the Apex Court in a decision reported in United India Insurance Company Ltd. Vs. Sunil Kumar and Another, . Taking into consideration the conflict on this principle, the matter has been referred to a Larger Bench and the decision is awaited. So long the Apex Court considered the question in the matter under reference, it is the latest Judgment of the Apex Court which binds this Court and as the Full Bench decision has been referred to in Ningamma''s Case and has been distinguished, merely because that the aforesaid decision is the Full Bench Judgment, it is not proper in the present circumstances to hold that even a person, who sustains injuries due to his/her own negligence would make a claim under Section 163-A of the Act. In the aforesaid circumstances, I am of the opinion, that as the said two Judgments of the Apex Court in Ningamma Vs. United India Insurance Co. Ltd. and another National Insurance Company Ltd. Vs. Sinitha and others have been accepted by this Court as well in the Division Bench Judgment, I am of the opinion that a claim under Section 163-A of the Act cannot be maintained in case if the rider is either the owner or an employee or an agent as such persons do not fall in the purview of the third party risk under Chapter XI of the Motor Vehicles Act.

It is no-doubt true that in National Insurance Company Ltd. Vs. Sinitha and others Case, the Apex Court held the insurer is liable to pay the compensation solely for the reason that the Shijo, the deceased was not riding the motorcycle either in the capacity as the owner or an employee or an agent. Therefore, the liability of the Insurance Company was upheld by the Apex Court. But, as could be seen from the contents of the complaint herein, it is made clear that Ulhas [deceased] was riding the motorcycle under instructions and permission of the owner, who was present at the time when the vehicle was taken by Ulhas [deceased]. That apart, when he was riding the motorcycle, an accident occurred due to skidding. A presumption could be raised that it is because of his negligence, the accident occurred. Furthermore, he stepped into the shoes of the owner and does not fall within the purview of the third party. Therefore, the insurer is not liable to pay the compensation. Anyhow, under the policy, a sum of Rs. 50-00 has been collected towards Personal Accident Claims. Under the said clause, a sum of Rs. 1,00,000-00 is payable by the insurer to the legal representatives of the deceased-Ulhas. To this extent, the appellant is liable to pay the compensation with interest. Therefore, the aforesaid point is answered accordingly.

Consequently, the appeal is allowed. The Judgment and Award made by the Tribunal is modified. The claim under Section 163-A of the Act is rejected. The appellant/insurer shall pay a sum of Rs. 1,00,000-00 with interest at 9% p.a. from the date of the petition till its payment and the said sum shall be shared by respondents 1 and 2 equally. Respondents 1 and 2 are at liberty to withdraw the said amount. After satisfying the claim of respondents 1 and 2, the excess amount if any shall be refunded to the insurer.