JUDGMENT
Arun Kumar Goel, J.
1. We propose to dispose of all these three appeals by this common judgment as they have arisen out of the same accident.
2. Dr. Lalit Kumar Sharma, learned Counsel appearing for the appellant-Insurance Company in support of these appeals have raised two pleas namely:
(a) that the owner of the vehicle i.e. insured had carried passengers in breach of the contract of insurance subject to which the vehicle was insured with his client and the deceased being gratuitous passenger was neither covered nor was statutorily required to be covered, therefore, the learned Tribunal below had fallen into error, while holding the appellant liable for payment of compensation as assessed in these cases; and
(b) that driver on the date and time of accident in question was not holding a valid and effective driving licence as such the appellant has been wrongly fastened with the liability to pay compensation in these cases.
3. Thus according to him these appeals deserve to be allowed and consequently appellant exonerated of its liability to pay the compensation.
4. Both these pleas have been controverted by the learned Counsel appearing for the respondents/claimants, driver and legal representatives of deceased owner of the vehicle in question. They submitted that looking to the materials on record, the impugned award deserves to be upheld and thus they have prayed for dismissal of these appeals.
5. Before dealing with these contentions, facts of each appeal need to be briefly noted:
F.A.O.No.313 of 1997:
In this case Lal Chand had sustained injuries. He was travelling in the truck along with his luggage for which he had paid freight. He sustained multiple fracture which resulted in his suffering permanent disability. He claimed compensation to the tune of Rs. 5 lacs.
F.A.O.No.314 of 1997:
Smt. Roshani Devi is the widow, Purvahi Devi is the daughter and S/Shri Nikku Ram and Rajinder Kumar are the sons of Abhia Ram deceased. He was working as a Peon in the Irrigation and Pubic Health Department at Pangi. He along with his luggage had boarded the truck after payment of freight to its owner. They claimed compensation to the tune of Rs. 4 lacs.
F.A.O.No. 315of 1997:
Smt. Jagtamba Devils the widow, Shashi Pal and Rajeev Kumar are the sons and Kumari Sneh Lata is the daughter of late Sh. Madan Lal. His mother Surti Devi was impleaded as a claimant. However, she died during the pendency of “the proceedings, as such, her name was ordered to be deleted. Deceased was working as Clerk in Education Department of the State Government. He was also a passenger and was permitted by the owner of the truck to travel in the said truck. Compensation in the sum of Rs. 10 lacs was claimed.
6. Accident is stated to have taken place on 24.8.1993 at 6.45 a.m. near Rohali Nallah, on Udaipur Road in the District of Lahaul-Spiti. Besides casualties there were number of other persons who sustained, injuries. Sohan Lal was driver and late Jagdish Ram was its owner. Compensation was claimed as aforesaid. Claim petitions of Lal Chand and Jagtamba Devi were disposed of by a common award passed by the learned Tribunal, Kullu, District Kullu and petition of Roshani Devi was disposed of by a separate award.
7. So far driver is concerned, he was resisting the petition of the claimants. He pleaded that he was neither rash nor negligent while driving the vehicle when accident took place. According to him when he was negotiating a curve the steering of the vehicle got jammed. He tried to apply the brakes which failed. Despite his best efforts to avoid the accident he could not avoid it. He denied the claim of the legal heirs and further submitted that the claim is exaggerated.
8. Legal representatives of the owner contended that petitioners are not the legal representatives of Madan Lal. They also denied the accident in question having been taken place on 24.8.1993, but admitted that the vehicle belonged to Jagdish Ram. According to them vehicle stood insured with Oriental Insurance Company Ltd. Appellant-Insurance Company pleaded that the petition is beyond the period of limitation and the deceased as well as injured were not authorised passengers in the truck in question. Petition was alleged to be bad for want of necessary particulars. Plea of rash and negligent driving was not properly set up. It was bad for non-joinder of legal representatives of Madan Lai. Driver was not having a valid driving licence. The Insurance Company was not liable to indemnify the owner and the driver. Factum of rash and negligent driving was specifically denied. Insurance Company was not liable for payment of unauthorised passengers as those are not covered under the policy of insurance.
9. Following issues were framed by the Tribunal below in case Smt. Jagtamba Devi and Ors. v. Sohan Lal and Ors.:
(1) Whether the accident in question has taken place due to rash and negligent driving of DCM Toyota No. HPK-9447 by its driver Sohan Singh respondent No. 1 as alleged? OPP
(2) If Issue No. 1 is held in affirmative, whether the petitioners claimants are entitled to compensation if so, to what amount and from which of the respondent? , OPP
(3) Whether the deceased was an unauthorised passenger in the aforesaid vehicle, if so, its effect? OPR-7
(4) Whether the driver of the vehicle was not having a valid driving licence at the time of accident as alleged? If so, its effect? OPR-7 ”
(5.) Whether the Insurance Company respondent No. 7 is not liable to pay any compensation to the petitioner-claimants as alleged? OPR-7
(6) Whether the petition is within the time? OPP
(7) Relief?
Similarly in the connected petition i.e. Lal Chand v. Sohan Singh and Ors. the following issues were framed on the same date:
(1) Whether the accident in question has taken place due to rash and negligent driving of DCM Toyota No. HPK-9447 by its driver Sohan Singh respondent No. 1 as alleged? , OPP
(2) If Issue No. 1 is held in affirmative, whether the petitioner-injured is entitled to compensation, if so, to what amount and from which of the respondent? OPP
(3) Whether the petitioner-claimant was an unauthorised passenger in the aforesaid vehicle, if so, its effect? OPR-2
(4) Whether the driver of the vehicle was not having a valid driving licence at the time of accident as alleged, if so, its effect? OPR-2
(5) Relief?
In Roshan Devi and Ors. v. Sohan Singh and Ors. following issues were framed on 8,7.1994 by the Tribunal below:
(1) Whether the accident in question has taken place on account of rash and negligent driving of respondent-1? OPP
(2) Whether the petitioners are entitled for compensation, if so, how much and from whom? OPP
(3) Whether the petition is time barred, if so, its effect? OPP-2
(4) Whether the respondent-1 was not having any valid driving licence, if so, its effect? OPR-2
(5) Relief?
10. As already noted impugned awards have been passed. In case of Jagtamba Devi compensation of Rs. 4,29,400/-, with 12% per annum interest from the date of claim petition (i.e. 28.2.1994) till its deposit in the Tribunal and in case of Lal Chand a sum of Rs. 2,25,000/- with 12% p.a. interest from the date of claim petition till its deposit has been allowed. In both cases the amount is inclusive of interim compensation, if any, awarded as released to the petitioners. In the case of Roshan Devi and Others a sum of Rs. 3,53,800/- along with interest at the rate of 12% per annum from the date of petition till its deposit in the Tribunal has been awarded.
11. It may be noted here that when these cases were taken up learned Counsel for the parties were not in a position to state as to whether any claim petition was filed by other injured/legal representatives of the deceased, because besides three cases, number of other persons had sustained injuries.
12. With a view to support his first contention Dr. Lalit Sharma referred to a Division Bench decision of this Court reported in National Insurance Company Ltd. v. Smt. Tikma Devi and Ors. 1998 (1) Shim. LC 178, and urged that facts of these cases are identical to this case. This decision according to him covers the present cases both on law as well as facts. In this case Insurance Company was exonerated after examining the limits of liability of the Insurance Company as per policy and owner was held responsible. We should have ordinarily followed this decision. However, for the reasons to be recorded hereinafter this does not hold the ground in view of the subsequent decision of the Supreme Court of India.
13. According to Dr. Lalit Sharma, appellant Insurance Company stood exonerated by law on admitted facts, because of clear cut findings and law governing these cases. He placed reliance on Section 149(2)(a)(1) of Motor Vehicles Act, 1988 as this provision had been violated by carrying the gratuitous passengers in the vehicle at the time of accident.
14. Suffice it to say that there is overwhelming evidence examined by the claimants that the deceased/injured (as in the present cases), were travelling as owners of goods who had paid for carriage of those.
15. In New India Assurance Co. v. Satpal Singh and Ors. , what was held and is relevant for the present appeals besides being the ground for not following the above referred D.B. judgment of this Court was as under:
… 11. The result is that under the new Act an insurance policy covering third party risk is not required to exclude gratuitous passengers in a vehicle, no matter that the vehicle is of any type or class. Hence the decision rendered under the old Act vis-a-vis gratuitous passengers are of no avail while considering the liability of the Insurance Company in respect of any accident which occurred or would occur after the new Act came into force.
16. Faced with this judgment, Dr. Sharma submitted that this matter stands referred to a Larger Bench by Supreme Court of India and referred to New India Assurance Co. Ltd. v. Asha Rani and Ors. . Therefore, he urged that these appeal need to be adjourned sine die and should be only taken up after the outcome of the matter referred to a Larger Bench is notified. He further stated that in case his prayer is not allowed then the decision in the case of New India Assurance Co. v. Satpal Singh and Ors. (supra), be followed and he is not in position to say anything further. In this behalf we may observe that as on date law declared by the Supreme Court in the case of Satpal Singh and Ors. (supra), is the law of the land and it holds good, unless of course reversed, modified or otherwise declared not to be good law. As such we are following this decision.
17. Raising plea of liability of Insurance Company as contained in the policy of insurance, beside invoking Section 2(14) of the Motor Vehicles Act, 1968, Dr. Sharma has urged that the truck in question was solely meant “for carriage of goods and was adapted as goods vehicle, therefore, carriage of passengers in it was not permitted under law. He further stated that in the face of this position all the appeals deserve to be allowed.
18. Admittedly, vehicle in question was a goods carriage vehicle. While dealing, with limits of liability in terms of policy, Supreme Court in B.V. Nagaraju v. Oriental Insurance Co. Ltd. Divisional Office, Hassan I , considered this matter and held as under:
5. The terms of the Insurance Policy, inter alia, provide as follows:
‘Limitations as to rise: Only for the carriage of goods within the meaning of the Motor Vehicles Act, 1968.
The policy does not cover–(1) Use for organised racing, pace-making reliability trial or speed testing. (2) Use whilst drawing a trailer except towing of any one disabled mechanically propelled vehicle. (3) Use for carrying passengers in the vehicle except employees (other than driver) not exceeding six in number coming under the purview of W.C. Act, 1923.’
6. Learned Counsel for the appellant in support of this appeal, strongly relied on Skandia’s case (supra), making a fervent appeal that the terms of the policy afore referred to, should be read down to carry out the main purposes of the policy as the presence of 9 persons (when upto 6 were permissible), irrespective of their being employees or not, contributed in any manner to the occurring of the accident as also when the claim did not relate to any injuries to those 9 persons (who were owners of the goods loaded) or any loss incurred by them; the claim pristinely relating to the damage caused to the vehicle insured, which could not have been denied in the facts and the circumstances. Strong reliance, in support, was sought from the reasoning of the State Commission which had in so many words said:
… Even for the sake of argument, that 9 persons travelling in the vehicle were passengers, it cannot be a ground for Insurance Company to repudiate the contract as the fact of their being passengers or coolies does not make any difference to the risk involved. These persons were in no way concerned with the cause of the accident nor have they contributed to the risk in respect of the loss caused to the vehicle. The complainant has not claimed any compensation in respect of his liability to the persons travelling in the vehicle.
7. It is plain from the terms of the insurance policy that the insured vehicle was entitled to carry 6 workmen, excluding the driver. If those 6 workmen when travelling in the vehicle, are assumed not to have increased any risk from the point of view of the Insurance Company on occurring of an accident, how could those added persons be said to have contributed to the causing of it is the poser, keeping apart the load it was carrying. Here, it is no body’s case that the driver of the insured vehicle was responsible for the accident. In fact, it was not disputed that the on-coming vehicle had collided head-on against the insured vehicle, which resulted in the damage. Merely by lifting a person or two, or even three, by the driver or the cleaner of the vehicle, without the knowledge of owner, cannot be said to be such a fundamental breach that the owner should, in all events, be denied indemnification. The misuse of the vehicle was somewhat irregular though, but not so fundamental in nature so as to put an end to the contract, unless some factors existed which, by themselves, had gone to contribute to the causing of the accident. In the instant case, however, we find no such contributory factor. In Sikand’s case this Court paved the way towards reading down the contractual clause by observing as follows:
… When the option is between opting for a view which will relieve the distress and misery of the victims of accidents or their dependants on the one hand and the equally plausible view which will reduce the profitability of the insurer in regard to the occupational hazard undertaken by him by way of business activity, there is hardly any choice. The Court cannot but opt for the former view. Even if one were to make a strictly doctrinaire approach, the very same conclusion would emerge in obeisance to the doctrine of reading down’ the exclusion clause in the light of the “main purpose’ of the provisions to that the ‘exclusion clause’ highlighted earlier. The effort must be to harmonize the two instead of allowing the exclusion clause to snipe successfully at the main purpose. The theory which needs no support is supported by Carter’s “Breach of Contractor” vide paragraph 251. To quote:
Notwithstanding the general ability of contracting parties to agree to exclusion clauses which operate to define obligations there exists a rule, usually referred to as the ‘main purpose rule’, which may limit the application of wide exclusion clauses defining a promiser’s contractual obligations. For example, in Glynn v. Margeston & Co. 1893 AC 351 357, Lord Halsbury, L.C. stated: It seems to me that in construing this document, which is a contract of carriage between the parties, one must in the first instance look at the whole instrument and not at one part of it only. Looking to the whole instrument, and seeing what one must regard…. as its main purpose, one must reject words, indeed whole provisions, if they are inconsistent with what one assumes to be the main purpose of the contract.
Although this rule played a role in the development of the doctrine of fundamental breach, the continued validity of the rule was acknowledged when the doctrine was rejected by the House of Lords in Suissee Atlantique Societe d’Armement Maritime S.A. v. N.V. Rotterdamsche Kolen Centrale 1967 1 AC 361. Accordingly, wide exclusion clauses will be read down to the extent to which they are inconsistent with the main purpose, or object of the contract.
9. For the view above taken, this appeal is allowed, the judgment and order of the National Consumer Disputes Redressal Commission, New Delhi is set aside and that of the State Commission is restored in its entirety, but without any order as to costs.
19. So far plea of the driver not holding a valid driving licence is concerned, we may notice that in all these cases, applications under Order 41 Rule 27, C.RC. have been filed only seeking permission to lead additional evidence by summoning the officer of the Registration and Licensing Authority to show that the driver was not holding a valid and effective driving licence on the date of accident.
20. In case driver was not holding any valid driving licence as envisaged under Motor Vehicles Act, appellant cannot be held liable for payment of compensation. But then the question that needs consideration whether there is any evidence to prove this fact or not. Appellant-Insurance Company summoned a clerk from the Registration and Licensing Authority, Sundernagar namely, Dharam Singh (R.W. 3). He stated that as per record brought by him DL No. 32 has not been issued to Driver Singh son of Ruladu Ram.
21. Other witness examined is R.W. Yog Raj. He stated that he works as a Surveyor/ Loss Assessor. He was deputed to carry out survey regarding Truck No. HPK-9447 which he did and he has submitted his report which is Ex. RW- 4/ A.
22. According to Dr. Sharma, Sohan Singh who was driver of the vehicle should have produced his licence. Whatsoever information was available with the appellant-Insurance Company, it had made efforts to lead evidence with a view to support its plea that the driver was not holding a valid and effective licence on the date of accident. When a reference is made to the statement of Sohan Singh driver he has clearly stated in his cross-examination by the Insurance Company, that his driving licence is with the police and it was issued from Jogindemagar. He admitted that it was not renewed from Karsog. At the same time he does not remember its number. He specifically denied that on the date of accident he did not either have a valid driving licence or that it was fake and as a result of which he was not in a position to produce the same in Court.
23. So far provisions of Order 41 Rule 27, C.RC. are concerned, those can be invoked by an Appellate Court, when either with due diligence a litigant like appellant was not in the know of evidence that is intended to be produced by way of additional evidence; or it made an attempt to lead such evidence and its prayer was declined by the Court below; and lastly if for any other sufficient reason it is considered necessary by the Appellate Court to summon such evidence for deciding the case.
24. In the present case, R.W. 1 Sohan Singh, the driver of the vehicle was examined in Court on 2.8.1996. During cross-examination by the Insurance Company he put them to notice that his driving licence was issued from Jogindemagar and had been renewed at Karsog. He also put the Insurance Company to notice that the original driving licence was with the police. Thereafter, the case was adjourned on a number of hearings for further proceedings by the Tribunal.
25. Thus in our view, the appellant had enough time to get the police file summoned and then proceed further in the matter or to get the record summoned as well as proved from the Registration and Licensing Authority, Jogindemagar. No such steps have admittedly been taken. Besides this it is the case of appellant in its defence that driver was not holding a valid driving licence. So far this Court is concerned, we are satisfied that there is enough material to adjudicate these appeals and we do not require any further evidence. Since we have held that no ground exists for invoking provisions of Order 41 Rule 27, C.RC, therefore, in the absence of there being any other legal, reliable and cogent evidence to the effect that R.W. 1 was not having a valid driving licence on the date of accident, such a plea cannot be accepted.
26. It is now well settled that all exclusions have to be proved by Insurance Company.
27. In Narchinva V. Kamat and Anr. v. Alfredo Antonio Doe Martins and Ors. , it’ was held as under:
15. To sum up the Insurance Company failed to prove that there was a breach of the term of the contract of insurance as evidenced by the policy of insurance on the ground that the driver who was driving the vehicle at the relevant time did not have a valid driving licence. Once the Insurance Company failed to prove that aspect, its liability under the contract of insurance remains intact and unhampered and it was bound to satisfy the award under the comprehensive policy of insurance.
28. Observations made in Chimajirao Kanhojirao Shirke and Anr. v. Oriental Fire & General Ins. Co. Ltd. , by Supreme Court which are relevant for this case are as under:
9… Once a stand in fact is taken, that fact cannot be controverted by any legal proposition. In the present case, the Insurance Company has not led any evidence to dissolve the stand taken in the written statement that it was done by mistake nor was there any application to amend such pleadings….
29. In view of this, reliance placed by Dr. Sharma on the decision in New India Assurance Co. Shimla v. Kamla and Ors. , does not, in any manner, advance the case of the appellants.
30. No other point is urged.
31. For the foregoing reasons all these appeals are dismissed with no order as to costs.
Registry is directed to place an authenticated copy of this judgment on the file of other appeals.