The High Court
Case Details
IN THE HIGH COURT OF JHARKHAND AT RANCHI (Civil Miscellaneous Appellate Jurisdiction) M.A. No.322 of 2018 ------ Reliance General Insurance Company Limited, having its office 4th Floor, Chinta Mani Avenue, Off Western Express High Way, Near Virwani Industrial Estate, P.O.+P.S. Goregaon, Goregaon (East) Mumbai-400063 (Maharashtra) and also having its offie at 38B, Himalaya House, 8th Floor, Jawaharlal Nehru Road, P.O.+P.S. Harestreet Kolkata, PIN 700071 (West Bengal) through its Legal Manager and also through its Management Trainee Purnendu Chatterjee, aged about 24 years, son of Sankar Chatterjee, residing at B-10/293, Kalyani, Nadia, P.O. & P.S.-Kalyani, District-Kolkata, PIN 741235(West Bengal) .... .... …. Opposite Party No.2/Appellant Versus 1. Avanti Devi, aged about 30 years, wife of late Bhrigunath Sharma; 2. Lalan Kumar Sharma, age not known to the appellant, son of late Bhrigunath Sharma’ 3. Palan Kumar Sharma, age not known to the appellant, son of late Bhrigunath Sharma; 4. Ayush Kumar Sharma, age not known to the appellant, son of late Bhrigunath Sharma’ 5. Hare Ram Madaiya, age not known to the appellant, son of late Alam Madaiya, @ Jhalu Madaiya; 6. Yashomati Devi, age not known to the appellant, wife of Hare Ram Madaiya; (Respondent Nos.2 to 4 are minors and they are represented through their respondent No.1 being her mother and natural guardian), All are permanent residents of village-Burhai, PO- Burhai, PS-Madhupur, District-Deoghar(Jharkhand) and presently residing at C/o Lakhpati Sharma, Kochakulhi, P.O.& P.S.- Saraidhela, District-Dhanbad(Jharkhand) .... .... .... Claimants/Respondents 7. Naresh Rawani, age not known to the appellant, S/o Mohan Rawani, resident of Lalgarh, P.O.& P.S.-Madhupur, District- (Owner of Motor Cycle bearing Deoghar(Jharkahnd) -2- M.A. No.322 of 2018 registration No.JH-15L-2470) .... .... .... Opposite Party/Respondent
Legal Reasoning
------ PRESENT HON’BLE MR. JUSTICE PRADEEP KUMAR SRIVASTAVA For the Appellant For the Resp. No.7 ------ : Mr. Amit Kumar Das, Adv. Ms. Swati Shalini, Advocate : Mr. Lalit Yadav, Advocate ------ JUDGMENT C.A.V. ON 20/12/2023 Pronounced On 19 /03 /2024 Heard learned counsel for the parties. 2. The appellant-Reliance General Insurance Company Limited has preferred this appeal against the award dated 27.03.2018 passed by Learned District Judge-XIV-cum-Motoer Accidents Claims Tribunal, Dhanbad in Motor Acident Compensation Case No.41 of 2017, whereby and whereunder, the claimants (respondent Nos.1-6) have been awarded compensation to the tune of Rs.10,37,680/- along with interest @ 6 % per annum on account of death of one Bhrigunath Sharma arising out of motor accident. 3. The factual matrix giving rise to this appeal relevant for the purpose of adjudication of this appeal in narrow campus is that one Bhrigunath Sharma along with Hare Ram Madaiya were returning to their house by a tempo and on 16.01.2016 at about 6:10 pm when they reached near village Bara, the tempo driver stopped at patrol pump for getting fuel in the vehicle, meanwhile, a motorcycle bearing Reg. No.JH-15L-2470 being driven very rashly and negligently by its driver dashed the said Bhrigunath Sharma violently causing his instantaneous death. 4. In connection with the aforesaid accident, Karon P.S. Case No.04 of 2016 dated 17.01.2016 was registered for the offences under sections 279, 337, 338 and 304(A) of the Indian Penal Code against the driver-cum-owner of the offending vehicle bearing Reg. No.JH-15L-2470 and after investigation, charge-sheet has -3- M.A. No.322 of 2018 been submitted against him. Further, the respondent Nos.1- 6/claimants have instituted motor accident claim case No.41 of 2017 for compensation of Rs.20 lakhs along with interest @ 9 % per annum. 5. In the above claim case, the owner cum-driver of the offending motorcycle bearing Reg. No.JH-15L-2470 appeared and contested the claim case by filing written statement stating therein that the offending motorcycle was insured with defendant No.2 i.e. M/s Reliance General Insurance Company Limited vide policy No.2410652312005784 which was valid and effective from 00:30 hours on 08.06.2015 to midnight of 07.06.2016. In course of trial, he has also furnished the copy of the learner license in his favour (Ext.A) bearing License No.JH15/LL/10216/2016 issued on 11.03.2016, the said license was valid from 11.03.2016 to 10.09.2016. 6. The appellant-Insurance Company filed its separate written statement contesting the claim case, although admitted that the offending vehicle was insured with its company and specifically pleaded that driver-cum-owner of the offending vehicle was not holding any valid and effective driving license at the time of accident and he was also not qualified for holding or obtaining such driving license, as such committed the breach of terms and conditions of the policy. 7. Since the matter pertains to a limited issue of violation of terms and conditions of policy and no appeal has been filed either by the claimants claiming the quantum of compensation or by the owner-cum-driver of the offending vehicle. Therefore, this appeal
Decision
is taken to be disposed off on above sole ground for adjudication. 8. Heard Mr. Amit Kmar Das assisted by Mrs. Swati Shalini learned counsel for the appellant and Mr. Lalit Yadav, learned counsel appearing for the respondent No.7. 9. Learned counsel for the appellant has submitted that there was specific issue No.4 settled by learned Tribunal that “whether the driver of the motorcycle bearing Reg. No.JH-15L-2470 had -4- M.A. No.322 of 2018 valid and effective driving license at the date and time of accident?”. While deciding the said issue No.4 the learned Tribunal has also observed that Ext.A (Learner’s) driving license was issued in favour of Naresh Rawani, which was valid from 11.03.2016 to 10.09.2016 for driving LMV. However, the learned Tribunal has wrongly held that the said license covered the date of occurrence i.e. 16.01.2016 as from perusal of the Ext.A, the learner’s driving license which was issued on 11.03.2016, while the accident took place on 16.01.2016, it is obvious that the same has been issued post-accident, therefore, the owner-cum-driver had no valid driving license or was authorized to drive any vehicle on the date of occurrence as such violated the terms and conditions of policy. 10. It is fairly admitted by learned counsel for the appellant that although in view of statuary liability to satisfy the third party claim is on the shoulder of the Insurance Company, however it is further submitted that due to violation of terms and conditions of the policy by the insured, the Insurance Company has right to recover the same from the insured. The learned Tribunal has failed to protect the right of the insurance company without any justification as the right of recovery has not been provided in favour of the appellant-Insurance Company. 11. Learned counsel for the appellant has placed reliance upon the reported judgment of National Insurance Co. Ltd. Vs. Swaran Singh and Ors. reported in (2004) 3 SCC 297 and Pappu and Ors. vs. Vinod Kumar Lamba and Anr. reported in (2018) 3 SCC 208. 12. On the other hand, no plausible argument in rebuttal of the aforesaid contentions has been advanced by the learned counsel for the respondent No.7-owner of the offending vehicle. It is simply stated that there was learner’s license in favour of the respondent No.7- the owner-cum-driver of the offending vehicle. Admittedly, the offending vehicle was insured with the appellant- -5- M.A. No.322 of 2018 Insurance Company, therefore, the learned Tribunal has committed no illegality or infirmity while deciding the issue No.4. 13. Having apprised with the factual background of the case and the argument advanced by the parties, the main issue involved in this appeal is regarding the violation of terms and conditions of the policy and its consequences. 14. It is undisputed fact that in third party insurance, the Insurance Company is liable to satisfy the award at first and then in case the violation of any terms and conditions of the policy, it may be recovered from the insured. The reference in this regard may be given to the case of National Insurance Co. Ltd. Vs. Swaran Singh and Ors. reported in (2004) 3 SCC 297, the relevant para is quoted below: “83. Sub-section (5) of Section 149 which imposes a liability on the insurer must also be given its full effect. The insurance company may not be liable to satisfy the decree and, therefore, its liability may be zero but it does not mean that it did not have initial liability at all. Thus, if the insurance company is made liable to pay any amount, it can recover the entire amount paid to the third party on behalf of the assured. If this interpretation is not given to the beneficent provisions of the Act having regard to its purport and object, we fail to see a situation where beneficent provisions can be given effect to. Sub-section (7) of Section 149 of the Act, to which pointed attention of the Court has been drawn by the learned counsel for the petitioner, which is in negative language may now be noticed. The said provision must be read with sub-section (1) thereof. The right to avoid liability in terms of sub- section (2) of Section 149 is restricted as has been discussed hereinbefore. It is one thing to say that the insurance companies are entitled to raise a defence but it is another thing to say that despite the fact that its defence has been accepted having regard to the facts and circumstances of the case, the Tribunal has power to direct them to satisfy the decree at the first instance and then -6- M.A. No.322 of 2018 direct recovery of the same from the owner. These two matters stand apart and require contextual reading.” 15. In the present case, the owner-cum-driver of the offending motorcycle has produced Ext.A which categorically shows that it was a learner’s license and issued postdated to the accident. Admittedly the accident took place on 16.01.2016 and the said Ext.A i.e. learner’s license was issued on 11.03.2016. At the time of filing written statement, respondent No.7 has whispered nothing about possessing any valid and effective driving license on the date of occurrence rather it was produced during the course of trial. No other evidence has been brought on record by the respondent No.7 to establish that he was possessing valid and effective driving license or authorized for driving any motorcycle on the date of occurrence, therefore, mere production of insurance certificate does not absolve the owner-cum-driver/insured from the consequences of breach of terms and conditions of the policy. 16. In the case of Pappu and Ors. vs. Vinod Kumar Lamba and Anr. reported in (2018) 3 SCC 208 as relied upon by the learned counsel for the appellant, following principle reiterated by the Hon’ble Apex Court at para 17 which reads as under:- “17. This issue has been answered in National Insurance Co. Ltd. [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] In that case, it was contended by the insurance company that once the defence taken by the insurer is accepted by the Tribunal, it is bound to discharge the insurer and fix the liability only on the owner and/or the driver of the vehicle. However, this Court held that even if the insurer succeeds in establishing its defence, the Tribunal or the court can direct the insurance company to pay the award amount to the claimant(s) and, in turn, recover the same from the owner of the vehicle. The three-Judge Bench, after analysing the earlier decisions on the point, held that there was no reason to deviate from the said well-settled principle. In para 107, the Court then observed thus : (SCC p. 340) -7- M.A. No.322 of 2018 “107. We may, however, hasten to add that the Tribunal and the court must, however, exercise their jurisdiction to issue such a direction upon consideration of the facts and circumstances of each case and in the event such a direction has been issued, despite arriving at a finding of fact to the effect that the insurer has been able to establish that the insured has committed a breach of contract of insurance as envisaged under sub-clause (ii) of clause (a) of sub-section (2) of Section 149 of the Act, the insurance company shall be entitled to realise the awarded amount from the owner or driver of the vehicle, as the case may be, in execution of the same award having regard to the provisions of Sections 165 and 168 of the Act. However, in the event, having regard to the limited scope of inquiry in the proceedings before the Tribunal it had not been able to do so, the insurance company may initiate a separate action therefor against the owner or the driver of the vehicle or both, as the case may be. Those exceptional cases may arise when the evidence becomes available to or comes to the notice of the insurer at a subsequent stage or for one reason or the other, the insurer was not given an opportunity to defend at all. Such a course of action may also be resorted to when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage.” 17. In view of the aforesaid discussion and reasons, I find that it is settled law that in case involving third party, when violation of terms and conditions of policy is found, the insurance company has to satisfy the award and thereafter it is entitled to recover the same from the owner/insured. 18. In the instant case, learned Tribunal has ignored the aforesaid settled principle of law by not extending the right of -8- M.A. No.322 of 2018 recovery in favour of appellant-Insurance Company and has committed serious illegality. Therefore, to that extent the impugned award is modified and it is directed that the award amount of Rs.10,37,680/- shall be paid by the appellant-Insurance Company along with interest to the claimants and the insurance company has right to recover the paid amount from the owner/insured. 19. In view of the above, this appeal is allowed subject to above modification in the impugned award. 20. The statutory amount deposited by the appellant-Insurance Company is directed to be returned. 21. Pending I.As., if any, is disposed off accordingly. High Court of Jharkhand, Ranchi Date: 19/03/2024 Pappu-N.A.F.R./ (Pradeep Kumar Srivastava, J.)