IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE R.BASANT & THE HONOURABLE MR. JUSTICE V.CHITAMBARESH WEDNESDAY, THE 16TH NOVEMBER 2011 / 25TH KARTHIKA 1933 MACA.No. 2414 of 2008() ----------------------- OPMV.2111/2000 of MOTOR ACCIDENT CLAIMS TRIBUNAL, THRISSUR .................... APPELLANT(S): 3RD RESPONDENT: ----------------------------- UNITED INDIA INSURANCE COMPANY LIMITED, KOLLAM NOW REPRESENTED BY ITS DEPUTY MANAGER, REGIONAL OFFICE, "SHARANYA", HOSPITAL ROAD, KOCHI-11. BY ADV. SRI.MATHEWS JACOB, SENIOR ADVOCATE SRI.P.JACOB MATHEW RESPONDENT(S): PETITIONER AND RESPONDENTS 4 TO 6: ------------------------------------------------- 1. RATHEESH, S/O.LATE VASU, MULLASSERY HOUSE, S.N.PURAM, P.VEMBALLUR, P.O.PANANGAD, KODUNGALLUR, THRISSUR DISTRICT. 2. K.K.UNNIKRISHNAN, S/O.K.K.KESHAVAN, KAITHAVALAPPIL HOUSE, AYYAMPILLY P.O., ERNAKULAM DISTRICT, PIN 682 501. 3. RANJITH, S/O.VISWAMBARAN, AYINIPULLI HOUSE, S.N.PURAM, KODUNGALLUR, THRISSUR DISTRICT. 4. THE NEW INDIA ASSURANCE COMPANY LIMITED, IRINJALAKUDA. ADV. SRI.LAL GEORGE FOR R4 SRI.K.K.CHANDRAN PILLAI FOR R2 SRI.A.S.SAJUSH PAUL FOR R2 THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 16/11/2011, ALONG WITH MACA NO. 2467 OF 2008 MACA NO. 2470 OF 2008 MACA NO. 1248 OF 2009 THE COURT ON THE SAME DAY PASSED THE FOLLOWING: R. BASANT & V. CHITAMBARESH, JJ. ------------------------------------------------- M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 ------------------------------------------------- Dated this the 16th day of November, 2011 JUDGMENT Basant,J. When plurality of vehicles are involved in an accident does the victim/claimant have the unfettered option/right to claim compensation under Sec.163A of the Motor Vehicles Act against either or both the owners/insurers of the vehicles? Does the dictum in United India Insurance Co. Ltd., v. Madhavan (2011 (3) KLT 452) require re-consideration? 2. These are the questions of law of relevance that arise for consideration now. 3. A brief reference to crucial facts would be apposite. There was an accident involving two vehicles. There was a collision between a Tata Sumo van (the insured vehicle hereafter) and a motor-cycle. In the motor-cycle, at the relevant time ,there were three passengers - rider and two pillion riders. The accident took place on 5/8/1999. All the three passengers in the M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 2 :- motor-cycle suffered injuries. One of the two pillion riders succumbed to the injuries suffered by him. Both the injured persons and the legal heirs of the deceased pillion rider claimed compensation. They claimed compensation under Sec.163A of the M.V. Act. They arrayed the owner, driver and insurer of the insured vehicle and staked their claims against them. In the claim filed in respect of the two passengers (other than the rider of the motor-vehicle), the rider, owner and insurer of the motor- cycle were also arrayed as parties later. It is significant to state that no relief was claimed against the rider, owner or insurer of the motor-cycle. 4. The Tribunal under the impugned common award came to the conclusion that the claim under Sec.163A of the M.V. Act is legally sustainable. The Tribunal held that the insurer of the insured vehicle is liable to compensate all the claimants. 5. The insurer claims to be aggrieved by the impugned award. The short challenge raised by the appellant/insurance company is that when plurality of vehicles are involved in an accident, the owner/insurer of all such vehicles are liable to answer the claim under Sec.163A of the M.V. Act. The impugned common award inasmuch as it directs payment of compensation under Sec.163A of the M.V. Act by the insurer of one of the two vehicles involved in the accident is not legally sustainable. The M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 3 :- owner/insurer of the motor-cycle must also be made liable to the extent of 50%. This is the contention raised by the learned counsel for the insurance company. 6. In M.A.C.A. Nos.2414, 2467 & 2470 of 2008, the common appellant is the insurance company. In M.A.C.A. No.1248/09, the appellant is the rider of the motor-cycle. The Tribunal had awarded compensation. The appellant/rider is aggrieved by the compensation awarded by the Tribunal. 7. We shall initially consider the challenge raised on behalf of the insurance company. The question of law raised, we note, is already covered by a decision of the Division Bench in Madhavan (supra). Paragraph-6 of the said decision had considered the very same question in detail. We extract paragraph-6 of the said judgment below: 6. The next question is whether in a claim under Section 163A of the Motor Vehicles Act, the driver, owner and insurer (if any) of the other vehicle involved in the accident are necessary parties and whether the non impleadment of such driver, owner and insurer would adversely affect the claim under Section 163A against the owner and insurer of the vehicle involved. There is nothing in Section 163A to show that when two vehicles are involved, the claim must be staked against the owner M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 4 :- and insurer of both vehicles. As in the case of Section 140, we must hold that option is of the claimants to claim against the owner/insurer of either or both the vehicles. A claim under Section 163A can lie only against the owner of the vehicle and the authorised insurer. It cannot lie against a driver (unless he is the owner also). The language of Section 163 A makes the position crystal clear. In this case evidently realising the difficulty of recovering the amount from the owner of the other vehicle, which was not insured, the claimants have chosen to stake their claim only against the owner and the insurer of the vehicle in which the deceased was travelling. That option of the claimants is not in any way fettered or restricted by the language of Section 163 A. We therefore feel it absolutely safe to conclude that in a claim under Section 163 A, option is on the claimants, where plurality of vehicles are involved in the accident, to stake the claim against either or both the owners/insurers of the vehicles involved. In that view of the matter, the claim in this case against the owner and insurer of the vehicle, in which the deceased was travelling without arraying the owner and insurer of the other vehicle M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 5 :- involved in such accident, is perfectly justified and cannot be faulted. The challenge on that aspect is also found to be without any merit. 8. The learned counsel for the insurance company contends that the matter requires more detailed and exhaustive consideration. The learned counsel points out that the language of Secs.140 and 163A of the M.V. Act was not adverted to in detail in Madhavan (supra). The use of different language in the two Sections is crucial and therefore reference must be made to the language of the statutory provisions. It is the contention of the learned counsel for the insurance company that the dictum in Madhavan (supra) on this aspect may require re-consideration. 9. We shall initially extract the provisions of Secs.140 and 163A of the M.V. Act below: “140. Liability to pay compensation in certain cases on the principle of no fault. (1) Where death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 6 :- disablement in accordance with the provisions of this section. (2) The amount of compensation which shall be payable under sub-section (1) in respect of the death of any person shall be a fixed sum of fifty thousand rupees and the amount of compensation payable under that sub-section in respect of the permanent disablement of any person shall be a fixed sum of twenty five thousand rupees. (3) In any claim for compensation under sub-section (1), the claimant shall not be required to plead and establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act, neglect or default of the owner or owners of the vehicle or vehicles concerned or any of any other person. (4) A claim for compensation under sub-section (1) shall not be defeated by reason of any wrongful act, neglect or default of the person in respect of whose death or permanent disablement the claim has been made nor shall the quantum of compensation recoverable in respect of M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 7 :- such death or permanent disablement be reduced on the basis of the share of such person in the responsibility for such death or permanent disablement. (5) Notwithstanding anything contained in sub-section (2) regarding death or bodily injury to any person, for which the owner of the vehicle is liable to give compensation for relief, he is also liable to pay compensation under any other law for the time being in force: Provided that the amount of such compensation to be given under any other law shall be reduced from the amount of compensation payable under this section or under section 163A.” “163A. Special provisions as to payment of compensation on structured formula basis.-- (1) Notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle or the authorised insurer shall be liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 8 :- compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be. Explanation.-- For the purposes of this sub-section, “permanent disability” shall have the same meaning and extent as in the Workmen's Compensation Act, 1923 (8 of 1923). (2) In any claim for compensation under sub-section (1), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person. (3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time amend the Second Schedule.” (the crucially relevant portions are emphasised) 10. The language of Sec.140 of the M.V. Act makes it very clear that when more than one vehicle is involved in the accident, the owners of the vehicles shall be liable jointly and severally to pay the specified amount of compensation under Sec.140 of the M.V. Act. The liability is declared to be joint and several. However, when it came to Sec.163A of the M.V. Act, the M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 9 :- legislature did not significantly incorporate the stipulation that if two vehicles are involved, the owners/insurers of those vehicles shall be jointly and severally liable to pay the compensation amount prescribed under the structured formula in Schedule II of the M.V. Act. The learned counsel for the appellant/insurance company argues that the different language used by these provisions is significant and need more detailed consideration. 11. We have got to remember that no fault liability as a concept was introduced into the Indian law relating to compensation payable for motor accidents long later. Under Sec.166 of the M.V. Act and its corresponding predecessor provisions, a forum is provided for expeditious and inexpensive enforcement of the claim for compensation which right existed even earlier under the law of torts. Sec.166 of the M.V. Act does not create any new or different substantive legal liability. The liability under the law of torts is made enforcible and recoverable by the simplified procedure under Sec.166 of the M.V. Act and its predecessor provisions. 12. It is in this context that Sec.140 of the M.V. Act and its predecessor provisions came into the statute. As a first step the legislature declared that a fixed assured sum shall be paid to the victims of motor accidents who have suffered permanent disablement as also the legal heirs of persons who have M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 10 :- succumbed to such injuries. It is unnecessary to advert to precedents in any greater detail. The law under Sec.140 of the M.V. Act is well settled. Negligence or contributory negligence is irrelevant. Where death or permanent disablement results from an accident arising out of use of motor vehicle or motor vehicles, the owner or owners of the motor vehicles are made jointly and severally liable to pay the prescribed specified amount of compensation - `25,000/- in the case of permanent disablement and `50,000/- in the case of death, as the law now stands. 13. The legislature in 1994 introduced Sec.163A into the Statute book. While under Sec.140 even without proving any fault only a specific amount alone could be claimed, under Sec.163A comprehensive claim can be staked for compensation by the victims who have suffered permanent disablement or legal heirs of a deceased victim. 14. Provisions of Sec.140 of the M.V. Act make it clear that payment under Sec.140 is only ad hoc and interim. The claimants are entitled, even after claiming the amount under Sec.140 of the M.V. Act, to claim the entire amount of compensation which would otherwise be payable by resort to Sec.166 of the M.V. Act. The only stipulation is that the amount paid under Sec.140 must be adjusted towards the amount that would be payable under Sec.166 of the M.V. Act. M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 11 :- 15. The legislature, with long experience of working Sec.140, and its predecessor provisions had introduced 163A into the Motor Vehicles Act in 1994 and in Sec.163A of the M.V. Act significantly there is no reference at all to the nature of liability of owners/insurers if there is plurality of vehicles involved in the accident. The difference is significant. It could not be an inadvertent omission. Sec.140 speaks of the arrangement when plurality of vehicles are involved. The liability is declared to be joint and several. But when it came to Sec.163A of the M.V. Act the legislature did not incorporate such a stipulation. 16. Why? The query is pored. We have already noted that it could not be an inadvertent omission and this is eminently clear from Sec.163A(2) of the M.V. Act which eloquently conveys to the court that the legislature was cognizant and seized of the possibility of plurality of vehicles being involved in the accident. Wrongful act, neglect or default of the owner of the vehicle or vehicles concerned or of any other person need not be proved in a claim under Sec.163A of the M.V. Act, it is declared in 163A(2). This definitely reveals to the court that it was a conscious deviation from the scheme that was stipulated under Sec.140 of the M.V. Act. 17. So far as Sec.140 of the M.V. Act is concerned, it is now trite that claim can be raised against either or both owners/ M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 12 :- insurers of the vehicles. The decision in Oriential Insurance Co. Ltd., v. Lakshmikutty Amma and others [1999 ACJ 597 (DB)] makes the position clear that the Tribunal need not identify at the stage of award of compensation under Sec.140 of the M.V. Act all the vehicles (persons) liable to pay compensation. It is therefore evident that a claim under Sec.140 can be staked against the owner of either vehicle. The insurer consequently will be liable to indemnify the owner of the vehicle liable. 18. We requested the learned counsel to advance arguments at the Bar as to why totally different semantics and dynamics have been employed by the legislature while enacting Sec.163A of the M.V. Act. Significantly it is not even mentioned in Sec.163A that the liability is joint and several. Even under Sec.140 of the M.V. Act claim can be staked against either or both the owner/owners of the vehicle. It therefore appears to us to be evident that in a claim under Sec.163A also the choice/option must be for the claimant to stake claim against either or both owner/insurer of the vehicles involved in the accident. 19. Why has different language been employed by the legislature? It appears to us that the ad hoc/interim nature of the payment under Sec.140 must in this context assume significance. While the award under Sec.163A amounts to M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 13 :- comprehensive resolution of the compensation payable in respect of the accident, the one under Sec.140 is only interim in nature. In a claim under Sec.166 the amount already paid under Sec.140 has to be adjusted. 20. At the stage of Sec.140, the Tribunal is not at all to consider who would be liable under Sec.166 of the M.V. Act. But eventually when a claim under Sec.166 is disposed of any amount paid under Sec.140 will be liable to be adjusted. If there are two vehicles A and B involved in the accident and the claim under Sec.140 is staked only against the owner/insurer of vehicle A and in the claim under Sec.166 of the M.V. Act it is found that the owner/insurer of vehicle B is entirely liable to compensate the claimant, the payment made under Sec.140 must still be adjusted against the total amount awarded under Sec.166. To facilitate this it appears that under Sec.140 it is declared that the liability is joint and several. To continue with the example referred above, the owner/insurer of B while discharging the liability under a Sec.166 award will be entitled to claim adjustment of the amount under Sec.140 already paid by the owner/insurer of vehicle A. In the absence of a stipulation like that (making it clear that the liability is joint and several) it may have been difficult for the owner of the vehicle B to claim such adjustment. In view of the language employed by Sec.140 M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 14 :- it is now possible for the owner/insurer of the vehicle B to contend that notwithstanding the fact that the owner/insurer of vehicle A may have discharged the liability, such payment is liable to be adjusted towards the liability of the owner/insurer of vehicle B under Sec.166 of the M.V. Act. 21. This appears to us to be the only purpose for which the liability under Sec.140 is declared expressly to be joint and several whereas such stipulation is not made in Sec.163A. The award under Sec.163A settles the claim and after receiving the amount under Sec.163A no further claim can be staked under Sec.166. This position is well settled by the decisions in Oriential Insurance Co. Ltd., v. Hansrajbhai V. Kodala (2001 (2) KLT 235 = 2001 ACJ 827 SC) and Deepal Girishbhai Soni v. United Insurance Co. Ltd., (AIR 2004 SC 2107). 22. We are unable to find any other reason as to why a different language is used under Secs.140 and 163A of the M.V. Act by the legislature so far as the nature of the liability of the owner/insurer is concerned, when plurality of vehicles are involved. Consequently, therefore, it appears to us, that the option is entirely on the claimant to stake his claim against either or both owners/insurers of the vehicles involved in a claim under Sec.163A of the M.V. Act. That right/option of his got to be protected. M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 15 :- 23. It will now be apposite to consider the nature of the liability under Sec.163A. It is unnecessary to refer to the scheme of Sec.163A in any further detail. We find exhaustive consideration of the question in Kodala (supra) and Deepal Girishbhai Soni (supra). A Division Bench of this Court in National Insurance Co. Ltd., v. P.C. Chacko (2011 (3) KLT 693) had also considered the nature of the liability under Sec.163A in detail. We deem it sufficient to state that Sec.163A creates a new, distinct, different, absolute and substantive statutory liability. In Deepal Girishbhai Soni (supra), the Supreme Court in paragraph-39 has referred to the nature of the liability and the scheme of the M.V. Act in the following words: “39. Section 163-A was introduced in the Act by way of a social security scheme. It is a code by itself. x x x x x x “ The liability under Sec.163A has to be ascertained from the language employed by the legislature in Sec.163A. The non- obstante clause with which Sec.163A opens realistically recognizes the impressions which may remain in the mind of a law person in India in the light of the law that was prevailing earlier. Suffice it to say that a new, distinct, different, absolute, substantive statutory liability is created under Sec.163A and as stated in Deepal Girishbhai Soni (supra) it is by way of a M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 16 :- social security scheme - a code by itself. The non-obstante clause demands the effacement of entrenched concepts in legal minds before the attempt is made to understand the substantive statutory liability created and conferred under Sec.163A of the M.V. Act. 24. It is evident that Sec.163A postulates a social security scheme. The language of Sec.163A makes the provision crystal clear. The fact that the insurance company is made primarily liable is, according to us, eloquent. That emphasises the social security dimension of the statutory provision. The liability under Sec.166 or Sec.140 of the M.V. Act does not rest primarily on the shoulders of the insurance company. It rests on the owner/driver (under Sec.166) and the owner alone (under Sec.140). But come Sec.163A, the liability is on the insurer primarily. The dynamics of Sec.163A is important. While the insurer's liability to indemnify the owner (and pay compensation to the claimant) stems out of the stipulations in the policy of insurance (the stipulations in which policy are statutorily regulated), the liability under Sec.163A arises from the status as authorised insurer in respect of the vehicle. The methodology accepted by the legislature of making the authorised insurer principally liable under Sec.163A eminently epitomises the social security dimension of the statutory provision. 'Suffering' of the M.A.C.A. Nos. 2414, 2467 & 2470 of 2008 and 1248 of 2009 -: 17 :- victim and not 'fault' of any other is the central theme or foundation of liability under Sec.163A. All encompassing concern and compassion of the legislature in the socialist republic in favour of the unfortunate sufferer is the signature tune of the new statutory provision. The policy of insurance is relevant only to ascertain the status as authorised insurer. Thereafter the terms of the policy become irrelevant and the liability of the authorised insurer is specified in Sec.163A. It is true that under Sec.163A, “the owner of the motor vehicle or the authorised insurer” is made liable. But it is evident that where there is an authorised insurer the insurer in respect of the vehicle that burden is on the authorised insurer. It is true that the owner of the motor vehicle is also declared to be liable under Sec.163A. But that evidently must refer to a case where there is no statutory insurance. The owner is also made liable under law along with the insurer and that is, according to us, only to cover a case where there is no