Afr High Court
Case Details
1 YOGESH TIWARI Digitally signed by YOGESH TIWARI Date: 2025.08.14 18:47:18 +0530 AFR HIGH COURT OF CHHATTISGARH AT BILASPUR Judgment Reserved on : 09.06.2025 Judgment Delivered on : 14.08.2025 MAC No. 1231 of 2017 The Oriental Insurance Company Limited Through The Divisional Manager, Ambedakar Chowk, Ambikapur District Sarguja Chhattisgarh. versus ... Appellant 1 - Rajo Bai Wd/o Fuleshwar Aged About 43 Years Caste Rajwar, R/o Village Basdeopur Davankara Post Kewara, Tahsil Pratappur District Surajpur Chhattisgarh 2 - Vijay Kumar S/o Fuleshwar Aged About 28 Years Caste Rajwar, R/o Village Basdeopur Davankara Post Kewara, Tahsil Pratappur District Surajpur Chhattisgarh 3 - Sanjay Rajwar S/o Fuleshwar Aged About 25 Years Caste Rajwar, R/o Village Basdeopur Davankara Post Kewara, Tahsil Pratappur District Surajpur Chhattisgarh 4 - Savitri D/o Fuleshwar Aged About 24 Years W/o Chandrika, Caste Rajwar, R/o Village Basdeopur Davankara Post Kewara, Tahsil Pratappur District Surajpur Chhattisgarh 2 5 - Sonu Sai, S/o Kendu Rajwar Aged About 65 Years Caste Rajwar, R/o Village Basdeopur Davankara Post Kewara, Tahsil Pratappur District Surajpur Chhattisgarh 6 - Kanas Kunwar S/o Sonusai Aged About 62 Years Caste Rajwar, R/o Village Basdeopur Davankara Post Kewara, Tahsil Pratappur District Surajpur Chhattisgarh 7 - Sampat Lal Kushwaha S/o Shambhuram Kushwaha, R/o Sahari, Post Kewara Tahsil Pratappur District Surajpur Chhattisgarh 8 - Vikram Singh S/o Baratlal Gond Aged About 35 Years Occupation Driver R/o Village Kataipara Kewara Thana And Tahsil Pratappur District Surajpur Chhattisgarh (Cause-title taken from Case Information System) ... Respondents For Appellant : Mr. N.K. Malviya, Advocate For Respondents No.1 to 6 : Mr. Krishnakant Prajapati, Advocate
Legal Reasoning
Having considered the rival submissions advanced by the learned counsel for the parties and upon perusal of the entire record as well as the impugned award, this Court is of the considered opinion that the learned Claims Tribunal has not committed any illegality or perversity in appreciating the evidence or applying the legal principles governing the matter. 16 The Claims Tribunal, after detailed analysis of the evidence, including the admissions made by the driver of the offending vehicle in his cross-examination, rightly concluded that the accident occurred due to his negligence in abruptly halting the vehicle on the road without any indication or warning, which resulted in the deceased colliding with the rear of the vehicle. The Tribunal has also fairly attributed 10% contributory negligence to the deceased, who was following the said vehicle, on the ground that he failed to maintain a safe distance. 11 17 Further, the Claims Tribunal has extensively dealt with the question as to whether there was a breach of the terms and conditions of the insurance policy. In paragraph 16 of the award, the Tribunal has clearly recorded that the burden to prove such breach was on the insurance company, which it failed to discharge. The driver and owner of the vehicle had produced the registration certificate, valid permit, fitness certificate, insurance policy, and valid driving licence, all of which were found to be effective on the date of the incident. No rebuttal evidence was adduced by the insurance company to prove that the vehicle was being used in contravention of the policy terms. Thus, the Tribunal rightly rejected the defence raised under Section 149(2) of the M.V. Act. 18 The Hon’ble Supreme Court in the matter of IFFCO Tokio General Insurance Co. Ltd. v. Geeta Devi and others, 2023 SCC OnLine SC 1398, while dealing with the similar issue observed as follows:- “4. It would be apposite at this stage to note the statutory milieu pertinent to this case. Section 149 of the M.V. Act, to the extent relevant, reads as under: - “149. Duty of insurers to satisfy judgments and awards against persons insured in respect of third party risks.- (1)..… 12 (2) No sum shall be payable by an insurer under sub-section (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given the insurer had notice through the Court or, as the case may be, the Claims Tribunal of the bringing of the proceedings........; and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely:- (a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely: - (i)......; or (ii) a condition excluding driving by a named person or persons or by any person who is not duly licensed, or by any person who has been disqualified for holding or obtaining a driving licence during the period of disqualification; or…….” x x x x x x 9. Useful reference in this regard may be made to Skandia Insurance Co. Ltd. vs. Kokilaben Chandravadan and others, 13 (1987) 2 SCC 654, wherein this Court, in the context of Section 96(2)(b)(ii) of the Motor Vehicles Act, 1939, which is in pari materia with Section 149(2)(a)(ii) of the Act of 1988, observed as under: - “14. Section 96(2)(b)(ii) extends immunity to the insurance company if a breach is committed of the condition excluding driving by a named person or persons or by any person who is not duly licensed, or by any person who has been disqualified from holding or obtaining a driving licence during the period of disqualification. The expression 'breach' is of great significance. The dictionary meaning of 'breach' is 'infringement or violation of a promise or obligation' (see Collins English Dictionary). It is therefore abundantly clear that the insurer will have to establish that the insured is guilty of an infringement or violation of a promise that a person who is duly licensed will have to be in charge of the vehicle. The very concept of infringement or violation of the promise that the expression 'breach' carries within itself induces an inference that the violation or infringement on the part of the promisor must be a wilful infringement or violation. If the insured is not at all at fault and has not done anything he should not have done or is not amiss in any respect how 14 can it be conscientiously posited that he has committed a breach? It is only when the insured himself places the vehicle in charge of a person who does not hold a driving licence, that it can be said that he is guilty of the breach of the promise that the vehicle will be driven by a licensed Driver. It must be established by the insurance company that the breach was on the part of the insured and that it was the insured who was guilty of violating the promise or infringement of the contract. Unless the insured is at fault and is guilty of a breach the insurer cannot escape from the obligation to Indemnify the insured and successfully contend that he is exonerated having regard to the fact that the promisor (the insured) committed a breach of his promise. Not when some mishap occurs by some mischance. When the insured has done everything within his power inasmuch as he has engaged a licensed Driver and has placed the vehicle in charge of a licensed Driver, with the express or implied mandate to drive himself, it cannot be said that the insured is guilty of any breach.” 10. The correctness of the aforesaid decision was considered by a 3-Judge Bench of this Court in Sohan Lal Passi vs. P. Sesh Reddy 15 and others, (1996) 5 SCC 21 and it was duly approved, with the following observations: - “In other words, once there has been a contravention of the condition prescribed in sub-section (2)(b)(ii) of Section 96, the person insured shall not be entitled to the benefit of sub-section (1) of Section 96. According to us, Section 96(2)(b)(ii) should not be interpreted in a technical manner. Sub-section (2) of Section 96 only enables the insurance company to defend itself in respect of the liability to pay compensation on any of the grounds mentioned in sub-section (2) including that there has been a contravention of the condition excluding the vehicle being driven by any person who is not duly licensed. This bar on the face of it operates on the person insured. If the person who has got the vehicle insured has allowed the vehicle to be driven by a person who is not duly licensed then only that clause shall be attracted. In a case where the person who has got insured the vehicle with the insurance company, has appointed a duly licensed Driver and if the accident takes place when the vehicle is being driven by a person not duly licensed on the basis of the authority of the Driver duly authorised to drive the vehicle whether the insurance company in that event shall be absolved 16 from its liability? The expression 'breach occurring in Section 96(2)(b) means infringement or violation of a promise or obligation. As such the insurance company will have to establish that the insured was guilty of an infringement or violation of a promise. The insurer has also to satisfy the Tribunal or the court that such violation or infringement on the part of the insured was wilful. If the insured has taken all precautions by appointing a duly licensed Driver to drive the vehicle in question and it has not been established that it was the insured who allowed the vehicle to be driven by a person not duly licensed, then the insurance company cannot repudiate its statutory liability under sub-section (1) of Section 96.” 11. Thereafter, in National Insurance Co. Ltd. vs. Swaran Singh and others, (2004) 3 SCC 297, a 3-Judge Bench of this Court dealt with the interpretation of Section 149 of the Act of 1988. The cases before the Bench involved, amongst others, instances where the driving licence produced by the driver or owner of the vehicle was a fake one. The Bench noted that Section 149(2)(a) opened with the words: 'that there has been a breach of a specified condition of the policy', which would imply that the insurer's defence of the action would depend upon the terms of the 17 policy. It was observed that an insurance company which wished to avoid its liability is not only required to show that the conditions laid down in Section 149 (2)(a) or (b) are satisfied but is further required to establish that there has been a breach on the part of the insured. Such a breach on the part of the insured must be established by the insurer to show that the insured used or caused or permitted to be used the insured vehicle in breach of the provisions. The Bench went on to state that where the insurer, relying upon the violation of law by the assured, takes exception to pay the assured or a third party, it must prove a willful violation of the law by the assured. Noting that the proposition of law is no longer res integra that the person who alleges breach must prove the same, the Bench observed that an insurance company would be required to establish the said breach by cogent evidence and in the event an insurance company fails to prove that there has been breach of the conditions of the policy on the part of the insured, such an insurance company cannot be absolved of its liability.” 19 The amount of compensation awarded has been determined based on reliable documentary evidence including salary slips (Exhibits P/14 to P/16) showing that the deceased was employed as a colliery worker with an annual income of Rs.3,11,433/-. Future prospects were rightly considered, and necessary 18 deductions on account of personal expenses and contributory negligence have already been made by the Tribunal. The compensation awarded is just, reasonable and in consonance with the settled principles of law. 20
Arguments
For Respondents No.7 & 8 : Mr. Sanjeev Verma, Advocate Hon’ble Shri Amitendra Kishore Prasad, Judge CAV Judgment 1 Challenge in this appeal is to the award dated 29.04.2017 passed by the learned Additional Motor Accident Claims Tribunal, Pratappur, District Surajpur (C.G.) (hereinafter referred to as 'Claims Tribunal') in Claim Case No.29/2016 whereby learned Claims Tribunal allowed claim application in part of the claimants and fastened the liability to satisfy the compensation upon the non-claimants therein. 3 2 Brief facts of this appeal, in a nutshell, are that, on 06.12.2015, deceased Phuleshwar was driving his motorcycle bearing registration No.CG-15 E 7484 carefully on his side at normal speed and was going from village Bhaisamunda to his home village Basdevpur via village Davankara carrying grocery items and 407 Vehicle bearing registration No.CG-15-A-1635 (for short, ‘offending vehicle’) was being driven by its driver in a rash and negligent manner from Bhatgaon market side after loading market goods, buckets etc. and suddenly stopped the vehicle in the middle of the road without turning on the indicator back light and without giving signal, due to which, Phuleshwar's motorcycle collided with the vehicle from behind and got crushed, in which Phuleshwar suffered serious head injuries and died on the spot. After the accident, the driver of the offending vehicle absconded with the vehicle. The accident report was lodged against an unknown driver. But in the investigation, it was found that the accident was caused by a vehicle owned by non-applicant No.2, hence a final charge sheet was filed against the driver of the said vehicle i.e. non-applicant No.3. 3 The claimants being legal representatives of the deceased filed claim application before the learned Claims Tribunal pleading therein that the deceased, Phuleshwar, was a 45-year-old man employed as a Collateral Worker, Category-1 Dealer in SECL, Bhatgaon Area. He was drawing a monthly salary of Rs. 50,572/-, 4 amounting to an annual income of Rs. 6,06,864/-. Considering the age of the deceased as 45 years at the time of the accident, a future prospect increase of 30%, i.e., Rs. 1,82,059/-, was added to the annual income, making the total notional income Rs. 7,88,923/-. Out of this, the deceased was estimated to be spending 1/7th, i.e., Rs. 1,12,703/- on himself, while the remaining Rs. 6,76,220/- was considered his contribution towards the claimants. Applying a multiplier of 14, as applicable for the age group of 41–45 years, the loss of dependency was computed at Rs. 6,76,220 x 14 = Rs. 94,67,080/-. After deducting income tax, the claimants were found to have suffered a loss of Rs. 73,12,315/-. Additionally, compensation under various other heads such as loss of love and affection, mental agony, loss of companionship, funeral expenses, etc. was claimed, making the total compensation sought Rs. 74,87,315/- from the non- claimants. 4 Non-applicant No.1, by filing a separate written reply, denied the entire claim. It was submitted that the accident of deceased Phuleshwar occurred due to an unknown vehicle, as reflected in the First Information Report (FIR). The alleged offending vehicle was seized six months later, on 30.05.2016, which created serious doubt regarding its involvement. The delay in seizure suggested that non-claimants No.2 and 3 may have conspired to implicate their vehicle falsely in the incident. The final report of the 5 investigation mentioned that the offending vehicle was found parked at the scene, and a Bolero vehicle was also seen crossing the road, but it was not conclusively established which vehicle caused the accident. If the offending vehicle had truly been parked before the accident near the milk booth, then it would have been mentioned in the crime detail form and seizure memo prepared the next day. 5 The insurance company submitted that the FIR and the written report by the deceased’s son, Sanjay Rajwada, stated that the accident occurred due to rash and negligent driving by a vehicle which hit the deceased’s motorcycle. However, in the claim application and final report, the claimants changed their version, stating that the deceased collided with a stationary offending vehicle, which was parked negligently on the road. These contradictory versions made it doubtful whether the accident involved the said offending vehicle at all. It was further contended that the deceased did not possess a valid and effective driving licence at the time of the accident, which constituted contributory negligence. Even if the Tribunal found the offending vehicle at fault, non-applicant No.3 was not responsible, as he did not possess a valid licence, amounting to violation of the terms of the insurance policy. Hence, the insurer was not liable to pay compensation, and the claim deserved to be dismissed with a direction to exonerate the Insurance Company. 6 6 In separate replies filed by non-applicants No.2 and 3, the entire claim of the claimants was denied. It was stated that the deceased was above 50 years of age, and was working merely as a labourer in SECL. His income had been grossly exaggerated. On the date of the incident, the deceased was driving his motorcycle at high speed, and due to his own negligence, collided with the vehicle of non-applicant No.2, leading to the accident. There was no negligence on the part of non-applicant No.3. On 06.12.2015, the alleged offending vehicle belonged to non- applicant No.2, was a goods vehicle, and its permit was valid until 02.01.2019, and fitness certificate was valid up to 18.03.2016. Without prejudice, it was further stated that if the Tribunal held non-applicant No.3 responsible for the accident, then on the date of the accident, he had a valid and effective driving licence. The vehicle was registered in the name of non-applicant No.2 and insured with non-applicant No.1. Therefore, if any liability was found, it was the Insurance Company, who would be liable to indemnify. Consequently, it was prayed that the claim be dismissed as being devoid of merit. 7 On appreciation of pleadings, oral and documentary evidence brought on record by the respective parties, learned Claims Tribunal while relying upon the various case laws, awarded a total compensation of Rs.45,15,536/-. Learned Claims Tribunal further held liable the deceased for contributory negligence to the extent 7 of 10% and as such, awarded total compensation of Rs.40,63,982/- along with interest @ 9% per annum from the date of filing of the claim application till its realization and fastened the liability to pay the amount of compensation upon the non- applicants therein. 8 Learned counsel for the appellant/Insurance Company submits that the award passed by the Claims Tribunal is unsustainable in law, which needs to be set aside. He further submits that although the Claims Tribunal rightly held that there was contributory negligence on the part of the deceased, it erroneously assessed it at only 10%, whereas it ought to have been at least 50%, as the deceased failed to maintain a safe distance from the truck and thus contributed substantially to the accident. It has been contended that the FIR was lodged against an unknown vehicle, and the alleged offending vehicle was seized six months later, creating serious doubt about its involvement. Possibility of false implication cannot be ruled out. It has been further contended that on the date of the accident, the offending vehicle lacked valid permit and fitness, amounting to a specific breach of policy conditions under Section 149(2)(a)(i)(a) of the Motor Vehicles Act, 1988 (for short ‘M.V. Act’), for which the insurer cannot be held liable. It has been further contended that the appellant was granted permission under Section 170 of the M.V. Act to contest the claim on all available grounds. The 8 compensation awarded is excessive and not just, especially considering the disputed income and improper deductions under personal expenses. Accordingly, it is prayed that the impugned award be set aside. 9 On the other hand, learned counsel for the claimants/respondents No.1 to 6 submits that the award passed by the learned Claims Tribunal is based on proper appreciation of evidence. It is further submitted that the income of the deceased was adequately proved through salary records, yet the Tribunal has not granted just and fair compensation under various conventional heads. Hence, the appeal filed by the insurance company deserves to be dismissed, and the compensation amount ought to be suitably enhanced. 10 Learned counsel for respondents No.7 and 8 submits that there was no negligence on the part of the driver in causing the accident. It is contended that the vehicle was being driven in accordance with traffic rules and with valid permit, fitness, and insurance. It is further submitted that if any liability arises, the same is to be indemnified by the insurance company, as the vehicle was duly insured on the date of the incident. Therefore, no liability can be fastened upon the owner or driver personally. 11 I have heard learned counsel for the parties and perused the record of the claim case carefully. 9 12 Perusal of paragraphs 14 and 15 of the impugned award would show that the Claims Tribunal, upon detailed appreciation of the evidence including the admissions made by the driver in his cross-examination and the contents of the final charge-sheet (Exhibit P-25), has rightly recorded a finding that the accident occurred due to the negligence of the driver in abruptly stopping the vehicle on the road without any signal or indicator, thereby attributing 90% negligence to the driver of offending vehicle and 10% contributory negligence to the deceased for not maintaining a safe distance while riding his motorcycle. 13 Perusal of paragraph 16 would show that the Tribunal has categorically held that the insurance company failed to discharge the burden of proving that the offending vehicle was being driven in violation of the terms and conditions of the insurance policy; rather, the driver of the offending vehicle had produced documentary evidence such as registration certificate, fitness certificate, permit, valid driving licence, and insurance certificate, all of which were found to be valid and effective on the date of the accident, and thus the issue was rightly decided against the insurance company. 14 Perusal of paragraphs 17 to 29 would show that the Tribunal, after considering the oral and documentary evidence including salary statements (Exhibits P-14 to P-16), concluded that the deceased Phuleshwar was working as an underground colliery worker 10 earning an annual income of Rs.3,11,433/-, which was rightly enhanced by 30% in view of future prospects, and after applying the multiplier of 14 and deducting personal and other expenses including pocket and fuel allowances, computed the total loss of dependency at Rs.44,20,536/-. Further, the Tribunal awarded compensation under conventional heads and, after deducting 10% towards contributory negligence, finally assessed the total compensation payable to the claimants at Rs.40,63,982/-. 15
Decision
In view of the above discussion, this Court finds no merit in the grounds raised by the Insurance Company. The findings recorded by the Claims Tribunal are based on proper appreciation of evidence and legal reasoning. No interference is warranted in the impugned award. 21 Accordingly, the appeal filed by the appellant/Insurance Company is dismissed being bereft of merit. 22 Record of the concerned Motor Accident Claims Tribunal be sent for necessary information and compliance. Yogesh Sd/- (Amitendra Kishore Prasad) Judge