IN THE HIGH COURT OF CHHATTISGARH AT BILASPUR ^ siffiSii^ B@R Appellant Owner Misc. Appeal (C) No. //A 9 /2010 Narendra Patel, aged about 47 years, S/o Ramnath Patel, R/o Rudhukela, Tahsil Gharghoda, Distt. Raigarh Versus Respondents Claimants •y Megnath Soura, aged about 40 years, S/o Sudarshan, R/o Tatkela, Tahsil r ^.. \"0 ^..••'''. . Gharghoda, Distt. Raipur ,->'* T Tm Q oTn-; .:>^.y^"1) ••"^^^' Uma shanker Khamhari, aged about 25 ^ ^•"^ r ^^^•; 3. ycars, S/o Tirtho, R/o Rudhukela, Tahsil Gharghoda, Distt. Raigarh Smt. Rajni Aged about 35 years, W/o Manbodh R/o Village Jamjhor, Thana Bagbahara, Distt. jashpur, The New India Insurance Co. Ltd. Through Branch Manage, The New India Insurance Co. Ltd. Branch Raigarh APPEAL UNDER SECTION 173 OF MOTOR VEHICLES ACT 1988 TliO^Cy'^^ 4. 1 •-^•—^^&^ .—..--— — 3 HIGH COURT OF CHHATTISGARH AT BILASPUR Sinale Bench: Hon'ble Shri Justice Prashant Kymar Mishra Miscellaneous Appeal (C.l No.403 of 2010 ^ Narendra Patel versus Megnath Soura and others QRDER ^o Postfor 10-11-2010 Sd//- Prashant Kumar Mishra Judge '%. •^ff HIGHCOURTOF CHHATTISGARH AT BILASPUR Sinale Bench: Hon'ble Shri Justice Prashant Kumar Mishra Appellant Miscellaneous Appeal (C.l No.403 of 2010 Narendra Patel versus Respondents Megnath Soura and others Present: Shri Parag Kotecha, counsel for the appellant. Shri Sanjay Agrawal, counsel for respondent No.1. Shri P. Dutta, counsel for respondent No.4. MiscellaneousADpeal under Section 173 ofthe Motor Vehicles Act, 1988 ORDER (Passed on |t)^ November, 2010) This appeal under Section 173 of the Motor Vehicles Act, 1988 (henceforth 'the Act') has been preferred by the owner of the vehicle challenging the order dated 5-1-2010 passed by the Claims Tribunal under Section 140 ofthe Act. By the said order, the Claims Tribunal has directed the appellant/owner to make payment of interim award, absolving the insurance company from the liability. 2. From the contents of the impugned order, it would appear that according to the claimant, the said vehicle was involved in the accident. The claimant has stated that Tractor No.CG 13 A 6743 and Trolley No.CG 13 A 6744 were engaged in transportation of metal chips (Gitti) and on the return journey, it was engaged in transportation of soil and during this return journey, the deceased "boarded in the tractor and trolley by paying Rs.50/-. When the •Aa;; .^ cc^ vehicle was coming back on 14-11-2007, it met with an accident in which the deceased Sudarshan Soura died. 3. While considering the application for payment of interim compensation under Section 140 of the Act, the learned Claims Tribunal observed that prima facie the vehicle appears to be used in breach of the terms of the insurance policy, therefore, the insurance company cannot be held liable to make payment of the interim compensation. 4. Shri Parag Kotecha, learned counsel appearing for the appellant/owner has argued that the question regarding breach of terms of the insurance policy is a fact to be decided after the trial is over, therefore, at this stage, the insurance company should not have been exonerated from liability of payment of interim compensation. 5. Per contra, Shri P. Dutta, learned counsel appearing for respondent No.4/insurance company would argue that prima facie the vehicle was plied in breach of the terms of the insurance policy, therefore, the Claims Tribunal has not committed any error in exonerating the insurance company from liability of payment of interim compensation. 6. In Yallwwa & Ors. vs. National Insurance Co. Ltd. & Anr., 2007 AIRSCW 4590, the Hon'ble Supreme Court, while dealing with the nature of jurisdiction and the scope under Sections 140 and 168 ofthe Act, has held in paragraphs 17 and 20 ofthe report thus: V, "17. In a given case, the statutory liability of an insurance company, therefore, either may be nil or a sum lower than the amount specified under Section 140 of the Act. Thus, when a separate application is filed in terms of Section 140 of the Act, in terms of Section 168 thereof, an insurer has to be given a notice in which event, it goes without saying, it would be open to the insurance company to plead and prove that it is not liable at all. 20. In British India General Insurance Co. Ltd. (supra), the question which arose for consideration was as to whether an insurer should be joined as a party in a proceeding under the Act apart from the provisions of the statute. Therein, the court was considering a claim under the Motor Vehicles Act, 1939. It was held therein: "17. Again, we find the contention wholly unacceptable. The statute has no doubt created a liability in the insurer to the injured person but the statute has also expressly confined the right to avoid that liability to certain grounds specified in it. It is not for us to add to those grounds and therefore to the statute for reasons of hardship. We are furthermore not convinced that the statute causes any hardship. First, the insurer has the right, provided he has reserved it by the policy, to defend the action in the name of the assured and if he does so, all defences open to the assured can then be urged by him and there is no other defence that he claims to be entitled to urge. He can thus avoid all hardship if any, by providing for a right to defend the action in the name of the assured and this he has full liberty to do. Secondly, if he has been made to pay something which on the contract of the policy he was not bound to pay, he can under the proviso to sub-section (3) and under sub- section (4) recover it from the assured. It was said that the assured might be a man of straw and the insurer might not be able to recover anything from him. But the answer to that is that it is the insurer's bad luck. In such circumstances the injured person also would not have been able to recover the damages suffered by him from the assured, the person causing the injuries.........." 7. As would be seen from the observation made by the Hon'ble Supreme Court in paragraph 17 in Yallwwa & Ors. vs. National Insurance Co. Ltd. & Anr. (supra), it is open to the insurance company to plead and prove (emp/pas/'s supplied) that it is not liable at all for payment of interim compensation, however, the stage of proving that the vehicle was driven in breach of terms of the insurance policy has not yet arrived in the proceedings before the Claims Tribunal. It is open for the parties, and the Claims Tribunal would eventually decide the issue after recording of evidence as to whether the vehicle was driven in breach of terms of the insurance policy or not, however, at the stage of interim compensation, the Claims Tribunal was not justified in absolving the insurance company from liability of payment of compensation. 8. In the opinion of this Court, the impugned order dated 5-1- 2010 needs to be interfered and, thus, the same is set aside. The miscellaneous appeal succeeds and is allowed. In the result, the insurance company shall also be liable to make payment of the award of interim compensation under Section 140 ofthe Act. Sd//- Prashant Kumar Mishra Judge Gopal