National Insurance Co. Ltd. v. Respondent No. 1

Ms. R. D. Mozumdar, learned counsel appearing for the appellant submitted that s ince the accident occurred for the rash and negligent driving and both the vehic les were negligent and contributed (70:30) to the accident, the appellant as the insurer of the motor cycle cannot be fastened with any liability for covering t hat damage. However, Ms. R.D. Mozumdar, learned counsel for the appellant did no t question any other aspect of the impugned award. While refuting, Mr. Phukan, learned counsel appearing for the respondent No. 1 h as categorically submitted that the appellant did not raise this plea of the con tributory negligence in the Tribunal and as such cannot be allowed to raise that plea in the appeal. The submission does not contain any substance on the face o f the finding returned by the Tribunal holding that the accident could happen fo r the contributory negligence of both vehicles. The appeal is confined to the qu estion of liability of payment. Ms. R. Begum, learned counsel appearing for the respondent Nos. 3 and 4 also sup ported the impugned judgment and award. This Court after scrutiny of the records and on appreciation of submissions adva nced by the learned counsel for the respondents is of the opinion that the insur ance coverage is always subject to the terms and conditions as incorporated in t he policy. In the appeal, the plea as to the ambit of liability cannot be raised and entertained. However, in this case it is found in para-7 of the written sta tement where the appellant has categorically mentioned that they have no liabili ty to cover the damage as sustained by the claimant-respondent. Be that as it may, it is a settled position of law that when the owner is tort f reaser he would not be entitled to benefit of the policy either as a third party or as the person who is driving the vehicle, unless by the contract, the scope of the insurance is expanded for personal accident coverage. Ms. R. D. Mozumdar, learned counsel for the appellant referred the decisions of the Apex Court as rendered in Dhanraj Vrs. New India Assurance Co. Ltd and Anoth er, as reported in (2004) 8 SCC 553 and Oriental Insurance Co. Ltd. Vrs. Sunita Rathi and Others, as reported in AIR 1998 SC 257 where the Apex Court has catego rically held that: (cid:28)The liability of the insurer arises only when the liability of the insured has been upheld for the purpose of indemnifying the insured under the contract of in surance. There is, thus a basic fallacy (cid:29) Under the contract of the insurance the claimant-respondent is not entit led to get any coverage. Even if the personal accident premium were paid by the insured, he would not have been allowed to maintain a claim under Section 163A a nd 166 of the Motor Vehicles Act, 1988. In that event the remedy would have been elsewhere. In view of the above, this Court finds sufficient force in the submissio n as advanced by Ms. R. D. Mozumdar, learned counsel appearing for the appellant . Thus the direction as made in the impugned judgment and award that the Nationa l Insurance Co. Ltd, the appellant herein, shall have to pay 30% of the compensa tion i.e. Rs. 58,323/- to the claimant-respondent with interest @ 6% per annum w ithin a period of two months from the date of judgment and award is interfered w ith and set aside. However, it is made clear that the other part of the findings and direction as regards the payment of compensation will remain intact. The Or iental Insurance Co. Ltd. has to pay 70% of the total amount i.e. Rs. 1,36,088/ - with interest @ 6% per annum from the date of filing of the claim petition til l the payment is made as per the time stipulated by the Tribunal. The statutory deposit be returned to the appellant for making the final payment in the tribuna l. For the reasons as aforesaid, the appeal stands partly allowed to the extent as indicated above. There shall be no order as to costs. Send down the LCRs forthwith.