* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment reserved on : 28.7.2011
Judgment delivered on : 03.8.2011
+ MAC APPEAL No.17/2009
NATIONAL INSURANCE CO.LTD. ...........Appellant
Through: Mr.Pradeep Gaur, Advocate.
Versus
SMT.SHEELA & ORS. ..........Respondents
Through: Mr.Navneet Goyal, Advocate.
CORAM:
HON'BLE MS. JUSTICE INDERMEET KAUR
1. Whether the Reporters of local papers may be allowed to
see the judgment?
2. To be referred to the Reporter or not? Yes
3. Whether the judgment should be reported in the Digest?
Yes
INDERMEET KAUR, J.
1. The Award impugned is the Award dated 26.8.2008 whereby
the legal heirs of deceased Davinder had been awarded
compensation in the sum of Rs.2.90,400/- along with interest @
7.5 % per annum. This claim petition had been filed under Section
163A of the M.V.Act .
2. Facts were that on the intervening night of 17/18.4.2005
Davinder @ Babloo and Lakshman along with their friend were
MAC APPEAL No.17/2009 Page 1 of 6
going on their motorcycle; the motorcycle suffered an accident an
unknown vehicle hit the motorcycle from behind as a result of
which the motorbike and the riders were thrown of balance.
Davinder and Lakshman fell down; they were crushed by some
unknown vehicle; they both died. The vehicle was being driven
by Lakshman; Davinder was the pillion rider. Sheela is the
claimant of deceased Davinder.
3. The appellant has filed the appeal assailing the award on
three grounds; first contention is that the deceased Lakshman has
no valid driving licence; secondly there was a breach of condition
of the policy; three persons were sitting on the motorcycle at the
time when the accident occurred; and lastly that it was hit and ran
case as such the claim cannot be entertained under Section 163A
of the M.V.Act; claim could only have entertained under Section
163 of the M.V.Act for which there is a fixed compensation of
`50,000/-.
4. Arguments have been rebutted. It is pointed out that since
the deceased had died in a road accident; even if the offending
vehicle has not been caught, Section 163A being a case of no
fault liability, it is only the involvement of the vehicle which has to
be established; which in this case has been fully established.
MAC APPEAL No.17/2009 Page 2 of 6
Evidence shows that the deceased had a valid driving licence;
there has also been no breach of conditions of the policy. The
Award calls for no interference.
5. Record shows that in this case the victim Davinder was the
pillion rider of the driver Lakshman; there is no dispute to the fact
that a pillion rider is covered as a “third party risk” and if the
claim is otherwise found to be in order the appellant/Insurance
Company is liable to pay compensation to the legal heirs of the
deceased pillion rider. Further in terms of the notification.
25.3.1977 issued by the Tariff Advisory Committee, Insurance
Companies have been made liable even in the case of pillion rider.
6. The submission of the learned counsel for the appellant that
the deceased Lakshman did not hold a valid driving licence is
without any merit. The respondent has produced two witnesses in
defence but none as deposed anything about the alleged factum
that the deceased did not have a valid driving licence.
7. The scheme of the Act by the promulgation of Section 163 of
the M.V.Act was intended to be incorporated as a special concern
for the safety and social security of such a person who had either
met with an accident himself resulting in injuries or the concern
for his legal representatives where the victim had died. The non-
obstante clause in this section dispenses with proof of fault; it is
MAC APPEAL No.17/2009 Page 3 of 6
based on a no fault liability; whole purpose being that the
claimants should as early as possible be granted the beneficial
provision of the Act and compensation be awarded to them in
terms of the structured formula prescribed in the second schedule
of the Act.
8. The Apex Court in National Insurance Company Vs. Swarn
Singh & Ors. reported in 2004(1) TAC 321 (Supreme Court) had
in this context interalia held noted as under:
(iii) The breach of policy condition e.g. disqualification of driver of
invalid driving licence of the driver as contained in sub-section (2)
(a)(ii) of Section 149, have to be proved to have been committed
by the insured for avoiding a liability by the insurer. Mere
absence, fake or invalid driving licence or disqualification of the
driver for driving at the relevant time, are not in themselves
defences available to the insurer against either the insured or the
third parties. To avoid its liability towards insured, the insurer has
to prove that the insured was guilty of negligence and failed to
exercise reasonable care in the matter of fulfilling the condition of
the policy regarding use of vehicles by duly licensed driver or one
who was not disqualified to drive at the relevant time.”
9. In a judgment of Gujrat High Court in India Insurance
Company Ltd. Vs. Muna Maya Basant Vs. reported 2001 ACJ
940, a Bench of the Gujrat High Court has noted that in a
claim petition under Section 163 A of the M.V.Act the scope
of raising a plea in defence about the challenge to the driving
MAC APPEAL No.17/2009 Page 4 of 6
licence is not permissible.
10. Thus a mere plea that there was absence of a valid driving
licence of the driver would not by itself entitle the Insurance
Company to avoid its liability. This argument is accordingly
rejected.
11. The appellant has also failed to show that there has been
breach of any of the terms of the policy; the policy in fact
negatives his submission. The conditions of the policy noted
herein below state:
Limitation as to use:
The policy covers use of the Vehicle for any purpose other than
a) Hire or Reward
b) Carriage of Goods (other than samples or personal Luggage)
c) Organized racing
d) Pace making
e) Speed Testing and Reliability Trials
f) Use in connection with Motor Trade”
12. Even as per the case of the appellant Lakshman the
deceased was driving the motor cycle; his contention is that three
persons were riding on the motor cycle when the fateful accident
occurred; this in no manner amounts to a breach of any of the
terms of the policy conditions. Learned counsel for the appellant
has also failed to draw attention of this Court to any such
condition in the policy. This argument is also without any merit.
MAC APPEAL No.17/2009 Page 5 of 6
13. Section 163A introduced by the amendment of 1994 has
introduced the principle of „no fault liability‟; being a social
security provision, this provision is applicable only where the
annual income of the deceased/victim does not exceed `40,000/-
per annum and the compensation under Section 163 A has to be
awarded strictly in accordance with the structured formula as
contained in the second schedule. Section 163 has laid down the
scheme for payment of compensation in „hit and run‟ motor
accident claim cases. Section 163 A does not become
inapplicable even if it is a „hit and run‟ case; condition to be
fulfilled for the applicability of Section 163A is that the annual
income of the victim must not be more than `40,000/- per annum;
further the compensation has to be awarded as per the structured
formula contained in the Second Schedule of the Act. This
argument of the learned counsel for the appellant is also without
any merit.
14. Appeal dismissed.
INDERMEET KAUR, J.
AUGUST 03, 2011
nandan
MAC APPEAL No.17/2009 Page 6 of 6