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Judgment
A.N. Venugopala Gowda
Sri B.A Jayaram, M/s Janatha Travel Service, No.8, Tank Bund Road, Bangalore-5600 09, was the owner of bus bearing registration No.KA-03-4750. The said person had obtained the insurance coverage in respect of the said bus from the appellant. On 9.8.2006 at 8.30 a.m., in front of Manish Tower on J.C. Road, Bangalore, on account of rash and negligent driving of the said bus by its driver, an accident occurred resulting in Miss T.N. Shruthi, the 1st respondent herein, sustaining injuries. A case was registered in Crime No.114/2006 for offences under Ss.279 and 337 IPC in the Ulsoor Gate Traffic Police Station. Police having investigated the crime, driver of the bus was charge sheeted. Miss T.N. Shruthi, the victim, having sustained injuries, after obtaining treatment, filed a claim petition under S. 166 of the Motor Vehicles Act, 1988 against the appellant and the 2nd respondent herein. Case was registered as MVC 7559/2006 in the MACT, Bangalore. The appellant was the 1st respondent in the said case. Objections and additional statement of objections were filed to the claim petition by the appellant/insurer. However, the 2nd respondent having not appeared, was placed ex parte and the case was proceeded.
Based on the pleadings, the Tribunal raised 3 issues. Claimant deposed as PW.1 and Dr. Ravish, deposed as PW.2. Exs.P1 to P16 were marked. On behalf of the insurer/appellant, a witness by name Smt. G. Thangamani was examined as RW.1 and Exs.R1 and R2 were marked. Upon consideration of the rival contentions and examining the record of the case, the Tribunal answered issue No.1 in the affirmative. Compensation payable was determined at Rs. 2,12,000/-, , Claim petition was allowed in part and award dated 27,2,2009 was passed. The award amount was directed to be paid with interest at 7.5% p.a, from the date of petition till the date of deposit. Questioning the said award, the insurer has filed this appeal.
Sri P.B. Raju, learned counsel appearing for the appellant mainly contended that the permit of the bus having expired, the Tribunal could not have held that the appellant is liable to pay the compensation. Learned counsel submitted that the Tribunal has misconstrued the ratio of decision in the case of National Insurance Co. Ltd. Vs. Challa Bharathamma and Others, . Learned counsel submitted that the vehicle in question being a transport vehicle, can ply on road with a valid permit and the permit having expired, the vehicle having been plied without a valid permit, there being a statutory breach by the insured, fastening of liability on the appellant to pay first and then recover, is wholly erroneous and hence, interference in the matter is called for,
Sri R. Chandrashekar, learned counsel appearing for respondent No.1 herein/victim, on the other hand, contended that the burden of proof with regard to the breach of policy conditions being on the appellant and the same having not been discharged, the Tribunal has not committed any error in fastening the liability on the appellant to deposit the amount and then recover the same from the insured. Learned'' counsel placed reliance on a decision in the case of Kamala Mangalal Vayani and Others Vs. United India Insurance Co. Ltd. and Others, . Learned counsel submitted that in the facts and circumstances of the case, the victim being a third party, keeping in view the object of the Motor Vehicles Act, the liability fastened on the appellant to deposit the amount being justified, the appeal being untenable may be dismissed.
I have perused the record of the case. The point for consideration is, whether the Tribunal is justified in directing the appellant /insurance company to deposit the awarded amount?
The Tribunal has fastened the liability on the appellant to deposit the award amount on the ground that the victim is a third party and in the circumstances she is entitled for the recovery of the award amount from the insurer, where after the insurer may recover it from the owner of the vehicle, i.e., by filing Execution Petition on the basis of the very award.
Indisputably, the appellant had issued insurance coverage to the offending vehicle and that there was coverage of insurance as on 9.8.2006 when the accident in question occurred and the 1st respondent herein sustained grievous injuries. Ex.R1 is the policy of insurance and Ex.R2 is the permit. The victim is a third party. The actionable negligence on the part of the driver of the offending vehicle has stood established. So far as the risk of the third party is concerned, the law is well settled. Apex Court in the case of National Insurance Co. Ltd. Vs. Swaran Singh and Others, has held as follows:
Under Section 149(1) alter a third party has obtained a judgment against any person insured by the policy in respect of a liability required to be covered by Section 146. the same must be satisfied by the insurer, notwithstanding that the insurer may be entitled to avoid or to cancel the policy or may in fact have clone so-. Where a liability has been established by a judgment it is not permissible to look beyond the determination in order to establish the basis of the liability. The same obligation applies in respect of a judgment against a person not insured by the policy in respect of such a liability, but who would have been covered if the policy had covered the liability of all persons, except that in respect of liability for death or bodily injury. However, what would also be covered by the contract of insurance, vis-a-vis the beneficent statutory provisions like Section 149(1) of the said Act. would be when a death or bodily injury has been caused as a result of the assured''s own voluntary act. Even an unforeseeable result of the assured''s deliberate act may come within the purview of an accident. Even if an accident has occurred due to negligent driving of the assured person, it may not prevent recovery under the policy and certainly thereby a third party would not be not: suited. Any condition in the insurance policy, whereby the right of the third party is taken away would be void.
Further in the above case file Apex Court has observed as under:
Section 149(5) which imposes a liability on the insurer must also be given its full effect. The insurance company may not be liable to satisfy the decree and. therefore, its liability may be zero but it does not mean ''hat it did not have initial liability at all Thus if the insurance company is made liable to pay any amount, it can recover the entire amount paid to the third party on behalf of the assured. Such an interpretation deserves to be given to the beneficent provisions of the Act having regard to their purport and object.
The appellant has failed to establish that the insured violated the policy condition by plying the vehicle without a valid permit. In the case of Swaran Singh (supra), Apex Court has further held as follows:
The residual question is what would be the appropriate direction. Considering the beneficial object of the Act, it would be proper for the insurer to satisfy the award, though in law it has no liability, in some cases the insurer has been given the option and liberty to recover the amount from the insured. For the purpose of recovering the amount paid from the owner, the insurer, shall not be required to file a suit. It may initiate a proceeding before the concerned executing court as if the dispute between the insurer and the owner was the subject matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. Before release of the amount to the claimants, owner of the offending vehicle shall furnish security for the entire amount which the insurer will pay to the claimants. The offending vehicle shall be attached as a part of the security. If necessity arises the executing court shall take assistance of the concerned Regional Transport. Authority. The executing court shall pass appropriate orders in accordance with law as to the manner in which the owner of the vehicle shall make payment to the insurer. In case there is any default, it shall be open to the executing court to direct realisation by disposal of the securities to be furnished or from any other properly or properties of the owner of the vehicle, i.e.. the insured. In the instant ease, considering the quantum involved, we leave it to the discretion of the insurer to decide whether it would like steps for recovery of the amount from the insured.
Keeping in view the ratio of the decision noticed supra and also the fact that the appellant has failed to discharge the burden of proof and in view of the ratio of decision in the case of Kamala Mangalal Vayani (supra), in my opinion, even if the appellant is not liable, yet having regard to the object of the Act and the victim being a third party, the appellant has lo first deposit the award amount and thereafter initiate proceedings as against the inured in the Tribunal itself and take steps to recover the amount awarded by the Tribunal from the insured. Such a course of action was held to be permissible by a Division Bench of this Court in the case of New India Assurance Co. Ltd., Vs. Papaiah and others, reported at 2006 ACJ 126. Consequently, the arguments addressed by Sri P.B. Raju is unacceptable.
In the result, the appeal is dismissed, reserving liberty to the appellant to initiate proceedings before the MACT, Bangalore and recover the award amount from the 2nd respondent/insured. No order as to costs.
Amount in deposit be transferred to the Tribunal for necessary action.