IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No.5410 of 2005 Date of decision:24.08.2010 Smt. Bhagwati Rana and others ....Appellants versus Joginder Pal Singh and others ...Respondents II. FAO No.1330 of 2006 New India Assurance Company Limited ....Appellant versus Smt. Bhagwati Rana and others ...Respondents CORAM: HON’BLE MR. JUSTICE K. KANNAN ---- Present: Mr. Jagram Singh Cooner, Advocate, for the appellants in FAO No.5410 of 2005 and for respondents 1 to 5 in FAO No.1330 of 2006. Mr.Manmohan, Advocate, for Mr.Suman Jain, Advocate, for the appellant in FAO No.1330 of 2006 and for respondent No.3 in FAO No.5410 of 2005. ---- 1. Whether reporters of local papers may be allowed to see the judgment ? 2. To be referred to the reporters or not ? 3. Whether the judgment should be reported in the digest ? ---- K.Kannan, J. 1. Both the appeals are taken up together and are disposed of by a common order. FAO No.5410 of 2005 is an appeal by the claimants for enhancement of compensation and FAO No.1330 of 2006 is an appeal by the Insurance Company. FAO No.5410 of 2005 - 2 - 2. The Insurance Company is in appeal challenging the award of Rs.3 lakhs for the representatives of the deceased, who was a pillion rider in a bicycle. The averments in the petition before the Tribunal were that the deceased was travellling with one Udey Parkash Thapa and they were just about to cross a tractor going ahead of them. The car belonging to the 2nd respondent and insured with the appellant-Insurance Company came from the opposite direction dashed against the cyclist and the deceased was run over by the rash and negligent driving of the 1st respondent before the Tribunal. He had been admitted in the hospital where he succumbed to the injuries. 3. The respondents 1 and 2, who were the driver and the owner of the car admitted the accident but claimed that the accident took place on account of the negligent conduct of Udey Parkash Thapa, who was riding bicycle. The Insurance Company suspected that there was a case of collusion between the claimants and the respondents 1 and 2 and sought for permission before the Tribunal for taking up defence on all grounds. The Tribunal had also allowed the petition under Section 170 of the Motor Vehicles Act. 4. Adverting to the aspect of collusion, the Tribunal reasoned that apart from the evidence of the claimant, who was the wife of the deceased, the person, who was said to have been riding the cycle namely, Udey Parkash Thapa, gave evidence about the involvement of the 2nd respondent's vehicle. The FIR, which had been lodged one day after the accident on 05.10.2003, had also given details about the car number. The Tribunal found since a FIR had been registered and there was evidence FAO No.5410 of 2005 - 3 - of an eye-witness, there was nothing to suspect the involvement of the vehicle. It had also observed that neither the driver nor the owner had dared to step into the witness box to deny the involvement of the vehicle. Having found the involvement of the vehicle, the Tribunal awarded a compensation of Rs.3 lakhs. 5. Along with the appeal, there has been an application filed under Order 41 Rule 27 CPC for reception of additional evidence. The evidence relates to an investigation report of Shri D.S.Chadha, who appears to have conducted an enquiry regarding the fact that this particular case was a part of a larger ploy to implant vehicles as having been involved in accidents whenever there were occasions of hit and run situations where the offending vehicle is not traced. It is contended that the particular lawyer who was conducting the case is under the scanner of Central Bureau of Investigation for implicating him in a fraud that was alleged as being practiced against the particular lawyer. It is stated in the petition filed on behalf of the Insurance Company that the investigation revealed that this particular vehicle which is said to have been involved in the accident belonged to one B.R.Budhiraja of New Delhi, who was purported to have transferred the vehicle to one Jagiro Devi, who is the wife of an Advocate, practicing at Ambala and who is associated with the Advocate, who was conducting the case. It is alleged that this particular driver, who is said to have been involved in the accident, namely, Joginder Pal Singh, is not a driver at all but he is a barber at Ambala and that in yet another case of alleged involvement of the vehicle, the Tribunal at Chandigarh found that a case had been wrongly FAO No.5410 of 2005 - 4 - filed by falsely referring to the said Joginder Pal Singh as a driver and that the accident as propounded by the claimant was found to be fake and dismissed the complaint with cost of Rs.1,000/-. 6. All this narration is not so much to say that any of the contentions of the Insurance Company are admitted and are found to be proved before this Court. A report by a police official himself may not be conclusive. It is a matter that has to be brought out in evidence. The appellant-Insurance Company runs on public money and if there is a systematic fraud that is being practiced against the companies to make fake claims, it is a very serious issue that ought to be addressed. This type of incident is not first of its nature. Similar complaints have come about in various States and the Supreme Court itself noticed such a situation in United India Insurance Company Limited Versus Rajinder Singh-2000 ACJ 1032. The Hon'ble Supreme Court had adverted to tainted claims and held that the Tribunal had power to review/ recall awards which were found to be tainted with fraud. In that case, the Tribunal had dismissed an application for review on the ground that it had no jurisdiction. The insurer moved the High Court by way of writ petition and that was also dismissed. In the appeal to the Hon'ble Supreme Court, it was held that the insurer was entitled to move the Claims Tribunal under Sections 151 and 152 CPC for examining the case of fraud if it was alleged to be so by the insurer. The Hon'ble Supreme Court had directed the Tribunal to reopen the award and decide the case afresh. A similar case was also reported from Madras High Court in Oriental Insurance Company Versus R.Money-2000 ACJ 247, similarly FAO No.5410 of 2005 - 5 - holding that the Tribunals had a power to recall the awards tainted by fraud from its very institution. In yet another case decided by a Division Bench of the Madras High Court in National Insurance Company Limited Versus State of Tamil Nadu-(2005) 1 Mad.LW 176, the Court had directed to entrust a batch of over 500 cases to the Central Bureau of Investigation, New Delhi for re-investigation. To a similar result was yet another case in National Insurance Company Versus K. Nandavalan- (2005) 2 Mad.LW 439, where the Court directed to constitute a central agency headed by Deputy Inspector of Police for the purpose of looking into the complaints relating to fake claims filed before the Motor Accident Claims Tribunal. The menace of fake claims is in some sense ubiquitous and they cannot be merely rejected as frivolous allegations, whenever they are made. The contention of the Insurance Company has been on the basis of a report secured through a retired police official. The facts narrated in the application for reception of additional evidence if they are true, would be too serious and they would vitiate the award passed by the Tribunal. 7. Under the circumstances, I am of the view that the award of the Tribunal is required to be set aside. The case is remitted to the Tribunal for admitting the report brought through an investigator and adduce evidence through such person to bring to light the genuineness or otherwise of the claim. The claimants shall have full opportunity to support their own version and they shall also be at liberty to adduce fresh evidence if they so desire. The Report filed along with the application under Order 41 Rule 27 CPC shall be permitted to be filed before the FAO No.5410 of 2005 - 6 - Tribunal and the Tribunal will take a fresh appraisal of the accident and consider the case in the light of the evidence adduce before it. If any amount has been recovered by the claimants from the insurer, they will not be required to refund the same. However, the right of the respective parties will have to abide by the final adjudication rendered by the Tribunal on remand. 8. The award of the Tribunal, under the circumstances, is set aside and remitted to the Motor Accident Claims Tribunal, Ambala, for fresh disposal in the light of directions given above. Parties shall appear before the Motor Accident Claims Tribunal at Ambala on 21.09.2010. (K.KANNAN) JUDGE 24 .08.2010 sanjeev