BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED: 29/03/2007 CORAM: THE HONOURABLE MR. JUSTICE S.NAGAMUTHU C.R.P. NPD (MD) Nos.807 of 2006 AND C.R.P. NPD (MD) Nos.808 to 817 of 2006 and M.P. (MD) Nos.1,1,1,1,1,1,1,1,1,1 and 1 OF 2006 T. Ramaiya .. Petitioner Versus National Insurance Co., 333/1, Sekkalai Road, Kariakudi Town, Sivagangai Rep. by its Branch Manager .. 1st Respondent
Irulappan .. 2nd Respondent in CRP
(NPD) No.807 of 2006
Malaichamy .. 2nd Respondent in CRP
(NPD) No.808 of 2006
L.Jothi .. 2nd Respondent in CRP
(NPD) No.809 of 2006
S.Ponnammal .. 2nd Respondent in CRP
(NPD) No.810 of 2006
M.Chandiran .. 2nd Respondent in CRP
(NPD) No.811 of 2006
R.Lakshmanan .. 2nd Respondent in CRP
(NPD) No.812 of 2006
P.Kalimuthu .. 2nd Respondent in CRP
(NPD) No.813 of 2006
P.Chandiran .. 2nd Respondent in CRP
(NPD) No.814 of 2006
S.Lakshmi .. 2nd Respondent in CRP
(NPD) No.815 of 2006
M.Padma .. 2nd Respondent in CRP
(NPD) No.816 of 2006
P.Valli .. 2nd Respondent in CRP
(NPD) No.817 of 2006
Prayer
Petitions filed under Article 227 of the Constitution of India to set
aside the fair order and decreetal order dated 04.02.2005 made in M.C.O.P.
No.167 to 175, 177 and 183 of 2003 on the file of the Motor Accidents Claims
Tribunal (Sub Court), Sivagangai.
!For Petitioner … Mr.R. Vijayakumar
^For 1st Respondent … Mr.N.Murugesan
For 2nd Respondent … Given up
:COMMON ORDER
These 11 revision petitions have been filed challenging the awards
made by the learned Motor Accidents Claims Tribunal(Sub Court), Sivaganga in
M.C.O.P. Nos.167 to 175 of 2003, 177 and 183 of 2003 in so far as the awards
relate to the direction contained in clause 5 of the decree that the Insurance
Company viz., the first respondent herein shall be entitled to recover the award
amounts from the petitioner after paying the same in accordance with award to
the claimants.
2. The brief facts of the case are follows:
The petitioner is the registered owner of the vehicle bearing Registration No.
TN-31-N-0289. On 15.04.2003, the said vehicle involved in an accident in which
admittedly 30 persons travelled in the said vehicle at the time of accident and
sustained injuries. Out of the said 30 persons, 18 have come forward with the
claim petitions in M.C.O.P. Nos.167 to 175 of 2003, 177 and 183 of 2003.
Admittedly, the vehicle was covered by a insurance issued by the first
respondent herein covering the relevant period. On full trial, the Tribunal was
pleased to pass awards granting compensation with interest at 9% p.a. from the
date of Award as detailed below:
M.C.O.P. No.
Compensation
167 of 2003
Rs.4000
168 of 2003
Rs.4000
169 of 2003
Rs.4000
170 of 2003
Rs.4000
171 of 2003
Rs.4000
172 of 2003
Rs.4000
173 of 2003
Rs.4000
174 of 2003
Rs.4000
175 of 2003
Rs.4000
177 of 2003
Rs.4000
183 of 2003
Rs.4000
3. During the trial a specific plea was taken by the first
respondent Insurance Company that there was a clear violation of the policy
condition and therefore the Insurance Company is not liable to pay compensation
to the claimants so as to indemnify the petitioner herein. According to one of
the permit conditions, the vehicle can carry only 25 persons, whereas, at the
time of accident it was carrying 30 persons and therefore it is a clear
violation of the said permit condition.
4.Accepting the said contentions of the Insurance Company viz., the
first respondent, the Tribunal has ordered compensation to be paid by the
Insurance Company to the claimants and thereafter right has been given to the
Insurance Company to recover the said award amounts paid to the claimants from
the owner viz., the petitioner herein. Challenging this part of the award, the
above civil revision petitions have been filed.
5.Heard both sides.
6. The short question which arises for consideration in all the
Civil Revision Petitions is:
“Whether mere violation of a policy condition in so far as it relates to the
number of persons would entitle the Insurance Company to avoid its liability to
pay compensation to the claimants?”
7. The learned counsel for the petitioner has drawn my attention to
the Division Bench Judgment of this Court reported in 2004 ACJ 140 (M.
Anandavalliamma v.Aravind Eye Hospital). After elaborately discussing the
various aspects relating to the violation of policy condition and having taken
into account various judgments of the Hon’ble Supreme Court, the Division Bench
in paragraph 19 and 20 of its judgment has held as follows:
‘Merely by lifting a person or two, it cannot be said to be such a fundamental
breach that the owner should, in all events, be denied indemnification. The
breach of the condition of the policy 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. If the insurance company is able to prove that it is because of the
presence of additional persons who were allowed to occupy the vehicle, the
accident occurred, the position would be different. Consequently, we hold that
even in cases where more passengers are taken with or without the knowledge or
implied consent or even consent of the owner, unless the insurance company is
able to prove that the accident took place only because of such act (taking more
passengers) the insurance company will be liable to make good the
loss/compensation. It has to be noted that in the case on hand, it is not the
contention of the insurance company that the accident had occurred because two
persons, over and above the prescribed limit in the policy, were travelling at
the relevant time in the vehicle. At this juncture, we may refer to a passage
from the judgment of the Supreme Court in Skandia Insurance Co. Ltd. v.
Kokilaben Chandravadan, 1987 ACT 411 (SC), wherein the court observed as under:
“Ordinarily it is not the concern of the legislature whether the owner of the
vehicle insures his vehicle or not. If the vehicle is not insured any legal
liability arising on account of third party risk will have to be borne by the
owner of the vehicle. Why then has the legislature insisted on a person using a
motor vehicle in a public place to insure against third party risk by enacting
section 94? Surely the obligation has not been imposed in order to promote the
business of the insurers engaged in the business of automobile insurance. The
provision has been inserted in order to protect the members of the community
travelling in vehicles or using the roads from the risk attendant upon the user
of motor vehicles on the roads. The law may provide for compensation to victims
of the accidents who sustain injuries in the course of an automobile accident or
compensation to the dependants of the victims in the case of a fatal accident.
However, such protection would remain a protection on paper unless there is a
guarantee that the compensation awarded by the courts would be recoverable from
the persons held liable for the consequences of the accident. A court can only
pass an award or a decree. It cannot ensure that such an award or decree
results in the amount awarded being actually recovered, from the person held
liable who may not have the resources. The exercise undertaken by the law
courts would then be an exercise in futility. And the outcome of the legal
proceedings which by the very nature of things involve the time cost and money
cost invested from the scarce resources of the community would make a mockery of
the insured victims, or dependants of the deceased victim of the accident, who
themselves are obliged to incur not inconsiderable expenditure of time, money
and energy in litigation.”
20.Following the rulings stated supra, this court is inclined to hold that
insurance company is certainly liable to compensate the claimants to the extent
indicated above.’
In the case on hand also the in the counter affidavit filed in the lower Court,
Insurance company had not pleaded that the accident was only because of taking
more passengers and there is no eyewitness on the part of the Insurance Company
to prove that the accident was only because of taking more number of persons
than the permitted number of passengers. In view of the above decision of the
Division Bench of this Hon’ble Court, I have to necessarily hold that the first
respondent Insurance Company is legally liable to indemnify the petitioner with
reference to his liability to pay compensation to the petitioners/claimants.
8.It is further contended by the learned counsel for the first
respondent that in this case totally 30 persons have sustained injuries and
therefore at least for this violation it should be held that the insurance
company is not liable to indemnify the petitioner. On this question the learned
counsel for the petitioner has relied on a judgment of this Court in Branch
Manager, National Insurance Co., Ltd., v. Murugesh & Others (1998 -1 L.W. 59),
wherein in paragraph 16, this court has held as follows:
“16.The alternative contention taken by learned counsel for the appellant
is that under the Policy, the maximum liability that can be fastened on the
Insurance Company can be only in respect of six persons. In this case, more
than nine persons have filed their claim petitions, and the Insurance Company
cannot be made liable for all these claimants when there is a basis for the
liability under the terms of the policy, that alone can be the basis for the
liability. A similar case came for consideration by a learned Judge of this
Court (P.Sathasivam J)in C.R.P.Nos.643 to 647 and 667 to 672 of 1991 and
C.M.A.211 of 1991 (National Insurance Co. Ltd., v. Chellakkannu and others) in
his order dated 1.10.1996, the learned Judge has held, following various other
decisions, that the Insurance Company might be made liable only to the extent
for which it has agreed to be made liable. In that case, the learned Judge held
that the first seven claim petitioners will be entitled to claim the respective
portions of compensation amount from the Insurance Company. Following the same
procedure, I hold that the Insurance Company is made liable in so far as Claim
Petition Nos.117,122,123,125,127 and 128 of 1989 are concerned. The claimants
in those cases will be entitled to recover compensation amount from the
Insurance Company also. That means, in those cases, the Insurance Company is
also made liable for paying the compensation amount.
Relying on the said decision, the learned counsel for the petitioner would
content that in the case on hand though 30 persons have sustained injuries only
18 persons have claimed compensation, which is far less than the permissive
number of passengers, viz. 25 as per the permit conditions.
9.I have given a careful consideration to the rival contentions at
this point and I have also perused the judgement of this Court referred to
above. This Court after having referred to various judgments has finally held
that the Insurance Company should be made liable to the extent for which it
agreed. In the instant case, the insurance company has agreed to indemnify the
owner of the vehicle in respect of 25 passengers, whereas the claimants are
only 18 in numbers. Therefore I have to necessarily hold that the Insurance
Company viz., the first respondent herein is liable to indemnify the petitioner
and as a result that part of the award in all these claim petitions giving right
to the first respondent insurance company to recover the award amounts from the
petitioner/owner of the vehicle after paying the same to the claimants stands
set aside.
10. In the result, all these revision petitions are allowed.
Considering the nature of the case, there is no order as to the costs.
Consequently, the connected M.P.s also closed.
To
1.The Motor Accident Claims Tribunal,
(Sub Court),
Sivaganga.