United India Insurance Co. Ltd. vs Shri Manjeet Singh and Others

Kailash Gambhir, J.—The appellant, United India Insurance Company Ltd., insurer of the offending vehicle has preferred an appeal challenging the impugned order dated 10.09.2004 passed by the learned MACT. The impugned award has arisen out of the claim petition filed by respondent No. 1 against the appellant as well as against respondent Nos. 2 to 5 claiming compensation for the death of Shri Kapoor Singh. The brief facts which are necessary for deciding the present appeal inter alia are that on 11.10.2000, Shri Kapoor Singh along with 4 other persons, while traveling in a Tata Sumo bearing registration number HR 26 F 3403 in order to go for a holy bath in the river Ganges, crossed village Chappar, little ahead of Muzaffar Nagar (UP), and prior to Village Barla and the said Tata Sumo collided with the Tractor Trolley. As a result, all of them sustained grievous injuries and Shri Kapoor Singh succumbed to his injuries in the Hospital.

The Tribunal after taking into consideration the facts of the case as well as evidence led by the parties has passed an award in the sum of Rs. 9,36,796/- along with interest at the rate of 9 % per annum payable from the date of the institution of the petition till the date of realisation. The said order passed by the Tribunal is now under challenge in the present appeal.

I have heard learned Counsel for the parties at considerable length.

The appeal is liable to be dismissed at the admission stage itself as the very maintainability of the appeal is in dispute.

Mr. Anil Kumar, the counsel for the respondent assails the very maintainability of the appeal and contends that the appellant cannot assail the findings of the Tribunal on the quantum of compensation as determined by the Tribunal. The appellant had not been granted leave by the tribunal to take over the defence of the owner and driver as envisaged u/s 170 of the Motor Vehicles Act and its application u/s 170 was dismissed by the learned tribunal on 09.09.2004, therefore, it is debarred from challenging the impugned award so as to assail the findings of the Tribunal on the quantum of compensation.

Mr. Pankaj Seth, counsel for the appellant while refuting the said contention of counsel for the respondent contends that the appellant cannot be rendered remediless merely because the application made u/s 170 was dismissed by the tribunal.

Motor vehicle accident claim is a tortious claim directed against tortfeasors who are the insured/owner and the driver of the vehicle, the insurer comes in to the picture as a result of the statutory liability created under the Motor Vehicles Act. The legislature intended and has ensured by enacting Section 149 of the Act that the victims of motor vehicle are fully compensated and protected. It is for that reason the insurer cannot escape from its liability to pay compensation on any exclusionary clause in the insurance policy except those specified in Section 149(2) of the Act or where the condition enshrined in Section 170 is satisfied.

Right of appeal is a creature of statute. The Parliament, while enacting Sub-section (2) of Section 149 only specified some of the defences which are based on conditions of the policy and, therefore, any other breach of conditions of the policy by the insured which does not fall under Sub-section (2) of Section 149 cannot be taken as a defence by the insurer. Had it been the intention of the Parliament to include the breach of other conditions of the policy as a defence, it could have easily provided for ''any breach of conditions of insurance policy'' in Sub-section (2) of Section 149. But it is not the case, since the legislator has enumerated specifically the grounds of defences available to the insurer. If the insurer is permitted to take any other defence other than those specified in Sub-section (2) of Section 149, it would mean we are adding more defences to insurer in the statute which is neither found in the Act nor was intended to be included.

After having given my thoughtful and conscious consideration to the issue involved in the present case, I am of the view that the issue is no more res integra as in catena of judgments including National Insurance Co. Ltd., Chandigarh Vs. Nicolletta Rohtagi and Others, National Insurance Co. Ltd. Vs. Mastan and Another, etc., the Hon''ble Supreme Court has authoritatively held that in the absence of permission being given by the Court as envisaged u/s 170 of the Motor Vehicles Act, the insurer has no right to file an appeal to challenge the quantum of compensation or finding of the Tribunal as regards the negligence or contributory negligence of offending vehicles is concerned. No such permission was granted to the appellant u/s 170 of the Motor Vehicles Act by the Tribunal and therefore, in the absence of the same, the appellant being the insurer of the offending vehicle cannot maintain the present appeal on grounds other than those available to it u/s 149(2) of the Motor Vehicles Act.

It would be appropriate to refer Section 170 of the Motor Vehicles Act as under:

Impleading insurer in certain cases- Where in the course of any inquiry the Claims Tribunal is satisfied that-

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

(b) the person against whom the claim is made has failed to contest the claim,

It may, for reasons to be recorded 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, without prejudice to the provisions contained in Sub-section (2) of Section 149, 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.

Admittedly, no such permission u/s 170 of the Motor Vehicles Act was given to the appellant, which clearly means that the procedure laid down u/s 170 of the Motor Vehicles Act was not followed. In the judgment of the Supreme Court reported in Shankarayya and Another Vs. United India Insurance Co. Ltd. and Another, the Supreme Court has held that the insurance company when impleaded as a party by the Court can be permitted to contest the proceedings on merits only if the conditions precedent mentioned in Section 170 are found to be satisfied and for that purpose the insurance company has to obtain an order in writing from the Tribunal and such an order should be a reasoned order of the Tribunal. In such circumstances unless the said procedure is followed, the appellant insurer cannot have a wider defence on merits than what is available to it by way of a statutory defence. Relevant part of Para 4 of the said judgment in this regard is referred as under:

It clearly shows that the Insurance Company when impleaded as a party by the Court can be permitted to contest the proceedings on merits only if the conditions precedent mentioned in the section are found to be satisfied and for that purpose the Insurance Company has to obtain order in writing from the Tribunal and which should be a reasoned order by the Tribunal. Unless that procedure is followed, the Insurance Company cannot have a wider defence on merits than what is available to it by way of statutory defence.

In view of the said legal position, I cannot appreciate the argument of counsel for the appellant that even without getting the permission of the Court as required u/s 170, the Appellant can proceed with the appeal.

There is no merit in the appeal and the same is dismissed.