JUDGMENT
D.S.R. Varma, J.
1. Heard Smt. Vijaya Lakshmi Counsel for the appellants-Insurance Company and Sri L. Prabhakar Reddy, Counsel for the respondents-claimants.
2. A.S. No. 2382/2004 is filed challenging the judgment and decree dated 19.4.2004 passed by the Court of Senior Civil Judge, Miryalguda in O.S. No. 124/2002. By the impugned judgment and decree the Court below decreed the suit filed by the plaintiffs and directed the defendants to pay a sum of Rs. 5,50,000/- to the plaintiffs towards the suit amount with interest on Rs. 5,00,000/- at the rate of 12 per cent per annum from the date of the suit till the date of decree and thereafter at the rate of 6 per cent per annum till the date of realization. The Court below also awarded a sum of Rs. 28,399/- towards the costs. Aggrieved by the above order, the defendants before the Court below which is an insurance company, filed this appeal.
3. The claimants also filed cross-objection challenging the very same judgment and decree, aggrieved by the order of the Court below in not granting the following reliefs (1) interest from the date of death of insured till the date of filing of the suit (2) interest at the rate of 15 per cent per annum on the total claim of the cross-objectors i.e., Rs. 6,22,250/-, from the death of insured instead of at 12 per cent per annum from the date of filing of the suit till the date of decree and 6 per cent till the date of realization and (3) the total claim of the claimants.
4. Since the appeal and cross-objections are connected and parties are common, they are being disposed of by this common judgment. For the sake of convenience, the appellant – Insurance Company shall be referred to as ‘Insurer’ and the respondents in the appeal and the cross-objectors who are the legal heirs of the insured shall be referred to as ‘the claimants’.
5. Though the matter is listed under ‘interlocutory caption’, at the request of both the Counsel and in view of the urgency pleaded, the matter is heard at length and with their consent, it is being disposed of finally.
6. The brief facts of the case are that the deceased died on 26.12.2001 due to a murder and the police have registered a case in Crime No. 235/2001 and issued the necessary F.I.R. The doctors who conducted post-mortem over the dead body of the deceased opinioned that the death was due to “loss of blood and injuries to brain and neck”. During the lifetime of deceased, he took insurance policy called ‘Janatha Personal Accident Policy’ for a sum of Rs. 5,00,000/- and the Claimant No. 1 who is his wife, was the nominee. Admittedly as on the date of death of the deceased, the policy was in force. Therefore, consequent upon the death of the deceased, the Claimant No. 1 made a claim before the insurer, with required material, on 26.2.2002 and subsequently as required, she submitted legal heir certificate and indemnity bond for the assured amount and also the final investigation report from the police. But the insurer on 19.11.2002 repudiated the claim on the ground that the deceased-insured violated the policy conditions under Sub-clause (e) of Clause 3.
7. The main case of the insurer before the Court below was that the insurer came to know during investigation subsequent to the death of the deceased, that he was a faction leader and involved in several criminal cases and was a strong supporter of a political party and in an act of retaliation by a group of persons out of criminal grudges with him, the deceased was murdered and this amounts to violation of Sub-clause (e) of Clause (3) of policy provisos and therefore it sought to justify its repudiation of the claim on this ground.
8. Basing on the above pleadings the Court below framed the following issues for consideration:
1. Whether the plaintiffs are entitled for recovery of policy amount from the defendants with future interest?
2. Whether the plaintiffs were subjected to mental agony by defendants entitling them to claim damages of Rs. 50,000/-?
3. To what relief?
9. In support of their respective case, the Claimant No. 1 was examined as P.W.1 and got marked Exs.A-1 to A-7 and on behalf of the insurer, the Branch Manager was examined as D.W.1 and Exs.B-1 to B-3 were marked. The Court below after appreciating the entire evidence available on record, negatived the contention of the insurer that insured violated Clause 3(e) of policy conditions and accordingly granted the reliefs, noted above.
10. The learned Counsel appearing for the insurer submitted that the murder of the insured is not covered under the policy and hence the murder does not amount to accident. She submitted that the insured was intentionally killed and it was not an accident. She submitted that the insured was involved in criminal cases and, therefore, he committed breach of law with criminal intent and this amounts to violation of Clause 3(e) of provisos to policy and hence the claimants are not entitled for compensation. She also contended that the order of the Court below in awarding damages and interest is also illegal and the same is liable to be set aside. With these submissions the learned Counsel prayed this Court to allow the first appeal.
11. On the other hand the learned Counsel for the claimants submitted that the deceased/insured did not commit any breach of law with criminal intent and the murder of the deceased amounts to accident and, therefore, the claimants being the legal heirs of the deceased, they are entitled for compensation under the policy. He also submitted that the Court below ought to have granted interest from the date of death of the insured and also interest at the rate of 15 per cent per annum instead of 12 per cent per annum. With these submissions, the Counsel for the claimants prayed for dismissal of the second appeal and for allowing of the cross-objections.
12. Both the Counsel relied on judgments of Apex Court and High Court. They will be referred to in the course of judgment at appropriate places.
13. In view of the above rival contentions, the following points would arise for consideration:
1. Whether the ‘murder’ amounts to ‘accident’ and if so, whether the same is covered under the policy?
2. Whether the Trial Court was justified in awarding special damages of Rs. 50,000/-?
3. Whether the Trial Court was justified in awarding interest at the rate of 12 per cent per annum and denying the interest as claimed by the claimants at the rate of 15 per cent per annum from the date of death of deceased till the date of filing of the suit and granting 6 per cent from the date of decree till the date of realization?
14. Issue No. 1: At the outset it is to be noted that as per Chitty on Contracts, 26th Edition Volume II, the insurance policy is a contract and normal principles of contract would apply (see Chapter 9 -Insurance under the heading “6. The Contract of Insurance” at 4242 Formation of the contract). As per the preamble of the policy, the insurer shall pay the insured sum if the insured sustains any bodily injury, resulting solely and directly from accident caused by outward, violent and visible means. From this it is clear that the insurer is liable to indemnify if the insured sustains any bodily injury and such injury should have direct nexus to the accident caused by outward, violent and visible means.
15. As noted above, the insurer repudiated the claim of the claimants on the ground that the insured violated the Sub-clause (e) of Clause (3) under the provisos of policy, which portion is marked as Ex.A-5. For ready reference, Clause 3(e) of the provisos of the policy is extracted as under:
“3. Payment of compensation in respect of death, injury or disablement of the insured from (a)… (b)… (c)….. (d)….. (e) Arising or resulting from the insured committing and breach of the law with criminal intent.”
16. From the preamble of the policy, death due to injury arising out of accident is a ground for making the claim and as per Sub-clause (e) to Clause (3) of provisos to policy, committing any breach of law with criminal intent is a ground for repudiation.
17. It is to be noted at this juncture that the term ‘accident’ is not defined under the Insurance Act, 1938 (for brevity ‘the Act’). Further the said Act enables the insurance company to issue different kinds of policies, subject to the approval of the competent authority. There is no dispute that the present Janata Personal Accident Insurance Policy is also one among such approved policies and this accident policy is equivalent to insurance policy and as such a social welfare measure and the Act is a welfare legislation.
18. The Hon’ble Apex Court also in the decision reported in National Insurance Co. Ltd v. Swaran Singh, , while dealing with an accident that took place under the Motor Vehicles Act, held that the provisions of M.V. Act are in the nature of social welfare legislation. Further the Apex Court in Rita Devi v. New India Assurance Co., Ltd., , while dealing with the object of Motor Vehicles Act and Workmen’s Compensation Act, held as under at Paragraph No. 15:
“The object of both the Acts, viz., the Motor Vehicles Act and the Workmen’s Compensation Act is to provide compensation to the victims of accidents. The only difference between the two enactments is that so far as the Workmen’s Compensation Act is concerned, it is confined to workmen as defined under that Act while the relief provided under Chapter X to XII of the Motor Vehicles Act is available to all the victims of accidents involving a motor vehicle. This conclusion is supported by Section 167 of the Motor Vehicles Act under which, it is open to the claimants either to proceed to claim compensation under the Workmen’s Compensation Act or under the Motor Vehicles Act. A perusal of the objects of the two enactments clearly establishes that both the enactments are beneficial enactments operating in the same field, hence the judicially accepted interpretation of the word “death” in the Workmen’s Compensation Act is certainly applicable to the interpretation of the word “death” in the Motor Vehicles Act also.”
19. From the above it is clear that the Apex Court held that the provisions of Motor Vehicles Act and Workmen’s Compensation Act are also most similar i.e., to provide compensation to the victims of the accident and the only difference is that Workmen’s Compensation Act is confined to ‘workman’ as defined under that Act and whereas the relief provided under Chapter X to XII of the M.V. Act is available to the victims of the accident involved in the motor vehicle and further, the objects of both the enactments are beneficial in nature.
20. In the above judgment, Their Lordships further held that the judicially accepted interpretation of the word “death” in the Workmen’s Compensation Act is applicable to the interpretation of the word ‘death’ in the Motor Vehicles Act.
21. The object of the Insurance policy is also undisputedly same as that of under Motor Vehicles Act and Workmen’s Compensation Act, inasmuch as different policies are being issued, as already noticed, with the approval of the competent authority under the Act and the present accident policy is one among them. ‘Accident’ with reference to injuries that would ultimately lead to death may occur in many statutes, and covered by different kinds of policies viz., Workman’s Compensation Act, M.V. Act etc. Their Lordships of Apex Court in Rita Devi’s case (supra) while dealing with the aspect as to whether the ‘murder’ can be treated an ‘accident’, made a distinction between the murder which is not an accident and the murder which is an accident and held that it depends on the proximate of the cause of murder. Their Lordships opined that if the dominant intention of the act of felony is to kill any particular person then such killing is not an accidental murder but is a murder simpliciter. It was further held that if the cause of murder or act of murder was originally not intended and the same was caused in furtherance of any other felonious act, then such murder is an accidental murder.
22. It is to be remembered that the Apex Court made the above distinction while dealing with a murder and the claim made under the Motor Vehicles Act. In that case, it is to be further seen that the deceased person was travelling in an autorickshaw and some antisocial elements with an intention. to take away the autorickshaw, committed assault on the deceased and it resulted in his death. Having regard to the fact that the predominant factor therein was to steel the autorickshaw and not to kill the person, Their Lordships held that it was an accident.
23. In fact there is subtle difference between the expression ‘accident’ and ‘accidental’. The word ‘accident’ is a direct result of an act, which is involuntary. In P. Ramanatha Aiyar’s Law Lexicon the word ‘accident’ is explained as “undesigned, sudden or unexpected event; mishap; misfortune; disaster”. It is further analyzed as under:
“The word “accident” generally denotes an event that takes place without one’s foresight or expectation; an event which proceeds from an unknown cause, or is an unusual effect of a known cause, and therefore not expected; chance casualty, contingency (Webster Dict); an event happening without the concurrence of the will of the person by whose agency it was caused. It differs from mistake in that the latter always supposes the operation of the will of the agent in producing the event although that will is caused by an erroneous impression on the mind”.
24. Further as per the New Lexicon Webster’s Dictionary, the word “accidental” means happening by chance. It denotes that there will not be any direct nexus between the act and the result and the result is the accident.
25. Now the question is whether the murder can broadly be understood as a mishap or an untoward event, not expected or designed and without any contribution on the part of the person who died. To meet this kind of situation, the Apex Court in Rita Devi’s case relied on the view expressed in earlier judgment in Nisbet v. Rayne and Burn, (1910) 2 KB 689, wherein a cashier while travelling in a railway to a colliery with a large sum of money for the payment of his employers’ workmen, was robbed and murdered. In those set of facts, the Court of Appeal held that the murder therein shall be treated as an accident. It was further held that the said accident did arise out of employment. The facts in Rita Devi’s case (supra) further discloses that view expressed in Nisbet case (supra) was followed by the majority judgment by the House of Lords in the case of Board of Management of Trim Joint District School v. Kelly, 1919 AC 667 = 83 LJPC 220 = 111 LT 305 (HL).
26. Since the expression ‘accident’ was not defined in any of the statutes, the general established principle is that the murder shall be treated as an accident, provided that same is not designed or intended by the person suffered accident and is an untoward and unexpected incident. However, in the present context since the term “accident” is not specifically defined under the insurance policy, the same should be understood contextually and circumstantially vis-a-vis terms and conditions and also the object of the present policy. The present policy, which is called Janatha Personal Accident Policy, indemnifies the person who suffers injury, which eventually results in his death under certain conditions. As already noticed, for claiming the compensation under the policy, the insured must sustain the injury solely and directly from accident caused by outward, violent and visible means.
27. In Halsbury’s Laws of England Fourth Edition, Volume No. 25 under the topic 5. Personal Accident Insurance, under the heading ‘(2) Policies Insuring Against Accidental Injury’, the meaning of ‘accident’ is defined at Sr.No. 594 and Violent means’ is defined at Sr.No. 602 and ‘external and visible means’ is defined at Sr.No. 604. The same are extracted as under for better appreciation:
“594. Meaning of “accident”. The event insured against may be indicated in the policy solely by reference to the phrase “injury by accident” or the equivalent phrase” accidental injury” or it may be indicated as “injury caused by or resulting from an accident”. The word “accident”, or its adjective “accidental”, is no doubt used with the intention of excluding the operation of natural causes such as old age, congenital or insidious disease or the natural progression of some constitutional physical or mental defect; but the ambit of what is included by the word is not entirely clear. It has been said that what is postulated in the intervention of some cause which is brought into operation by chance so as to be fairly describable as fortuitous. The idea of something haphazard is not necessarily inherent in the word; it covers any unlocked for mishap or an untoward event which is not expected or designed, or any unexpected personal injury resulting from any unlocked for mishap or occurrence. The test of what is unexpected is whether the ordinary reasonable man would not have expected the occurrence, it being irrelevant that a person with expert knowledge, for example of medicine, would have regarded it as inevitable. The standpoint is that of the victim, so that even wilful murder may be accidental as far as the victim is concerned.
602. Violent means. As used in this connection, “violent” has been interpreted as connoting the antithesis to “without any violence at all”. It does not therefore postulate the presence of brutal strength or savage temper, as when the victim is bitten by a dog. Again, an external cause of death, such as the inhalation of gas, may, it seems, be violent inasmuch as it does violence to the human frame by rendering it incapable of functioning. Similarly, where the cause of injury is some extra exertion or exercise of effort on the part of the assured, as where he stoops to pick up a marble, it is violent in the sense that it does damage impairing the bodily functions, however impaired they may have been before.
604. External and visible means, “external means” is used to point the contrast with something internal. Any cause which is not internal must be external, but this does not mean that the injury must be external; there may be, and often is, nothing externally visible to indicate the presence of internal injury at all. …. Where it is shown that the effective cause of the injury is external, the fact that it operates internally is irrelevant; indeed all poisons operate internally, and the cause of death in every case is failure of the heart…..”
28. From the above it is clear that murder, which is an unexpected event from the standpoint of victim, is an accident. In the instant case, it is not in dispute that the deceased was killed allegedly by group of persons belonging to other faction. Indisputably as the injuries being vital, the deceased died. Though it is on record that somebody attacked, the reasons are not known and further it is also very difficult to discern as to whether the intention of the person who attacked the deceased was only to cause injuries or to completely annihilate the deceased or for some other reason. Of course from the injuries caused it could be provisionally understood that the deceased was attacked to annihilate him. However, it would be totally a different subject, which has to be dealt with separately in the criminal adjudication. But when it comes to the purpose of contractual obligation by the Insurance Company under the policy, the death of the deceased should only be understood, as already discussed above, as an ‘accident’. The occurrence in my considered view satisfies all the conditions laid under the policy and hence it is inescapable for this Court to hold that the murder of the deceased in the present case shall be treated as an accident for the purpose of awarding compensation under the Janata Personal Accidence Policy.
29. But the case of the insurer is that the investigation conducted after the death of the insured revealed that the insured was involved in criminal cases and this amounts to violation of Sub-clause (e) of Clause 3 of the provisos of Insurance Policy and therefore, the insurer is perfectly justified in repudiating the claim. As per the said condition the insurer is not liable to pay compensation in respect of death, injury or disablement of the insured, if the same is arising or resulting from the insured committing any breach of the law with criminal intent. From the facts on record, there is no material to establish that the insured committed any breach of law with criminal intent. However, the facts reveal that the death of the insured was due to attack by some persons, allegedly belonging to some rival faction. Further it is to be seen that the insurer did not give any notice for cancellation stating that any provisos of the policy were violated. There is also no tangible material on record to substantiate the contention on behalf of the insurer that insured was intentionally murdered and that it was not an accident. Therefore, the distinction drawn by Their Lordships in Rita Devi’s case (supra) that intentional murder does not amount to accident, will not apply to the facts of the present case. From the facts available on record and as already discussed above, the death was an untoward incident and not expected, and not designed or intended and neither there was any commission nor omission on the part of the deceased, which lead to his death.
30. As noted above, the repudiation of the claim was on the ground that the deceased belong to a group of faction and involved in criminal cases. In fact this investigation ought to have been conducted before issuing the policy. No such enquiry was conducted earlier, nor the report, which discloses the alleged involvement of the insured in any criminal case and resulting in breach of any law with criminal intent, is made part of the record. Therefore, mere allegation subsequent to the death of the deceased, does not amount to violation of Clause 3(e) of provisos to policy. Hence, the repudiation of the claim without any basis cannot be accepted.
31. In view of the above discussion it is held that the murder in the present set of facts amounts to an accident, which is covered by the terms and conditions of the policy and the repudiation of the claim by the insurer is unsustainable. Accordingly the Issue No. 1 is answered in favour of the claimants.
32. Issue No. 2: For awarding damages, the Trial Court took the view that the unnecessary withholding of the claim caused hardship and mental agony to the claimants. From a perusal of the record it could be seen that there was no proper evidence on this aspect. Further, it is a matter of interpretation of the terms and conditions and the provisos to treat the ‘murder’ as ‘accident’. This exercise cannot be expected by the officials of the Insurance Company. Therefore, I do not find any justification in awarding a sum of Rs. 50,000/-towards damages and accordingly the order in that regard is set aside and the issue is answered in favour of the insurer.
33. Issue No. 3: As per the decision of the Larger Bench of our High in APSRTC, Hyd. and Anr. v. B. Vijaya, 2002 (4) ALD 862 (LB), (LB), the claimants are entitled for interest as per the discretion of the Court and also depending upon various circumstances like inflation, change of economy, policy of Reserve Bank of India, period of litigation, injuries sustained, their enormity etc. But having regard to the facts and circumstances in the present case and the interpretation of the words, suffice it to put on record that the rate of interest awarded by the Trial Court is on the higher side. Accordingly keeping in view the rate of interest prevailing in the present day’s context and following the decision of the Larger Bench in APSRTC, Hyderabad, and Anr. v. B. Vijaya, (supra) the interest awarded by the Court below at the rate of 12 per cent per annum from the date of the suit till the decree is reduced to 9 per cent per annum and the awarding of interest at the rate of 6 per cent per annum from the date of decree till realization is hereby confirmed and in view of the above facts and circumstances, the claim of the claimants with regard to interest and other reliefs in the cross-objections are hereby rejected. The issue is accordingly answered.
34. In the result the appeal filed by the insurer is partly allowed as indicated above and the cross-objections are dismissed. In the circumstances of the case, there shall be no order as to costs.