IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA FAO Nos. 80, 127, 417, 419 of 2004 and 162 of 2006. Judgement reserved on: 14.11.2008. Date of decision: December 19, 2008. ( For title, please see pages (i) & (ii)) Coram The Hon’ble Mr. Justice Kuldip Singh, Judge. Whether approved for reporting?1 For the Appellants : ( see overleaf). For the Respondents : Kuldip Singh, Judge. This judgement shall dispose of FAO Nos. 80, 127, 417, 419 of 2004 and 162 of 2006 arising out of MAC Case Nos. 6 of 2003, 43 of 2003, 75 of 2002, 72 of 2003 and 44 of 2003, decided on 11.12.2003, 28.2.2004, 24.9.2004, 1.10.2004 and 5.3.2004, respectively by learned Motor Accident Claims Tribunal, Kinnaur Civil Division at Rampur Bushahr. In all the above appeals, accident dated 29.10.2002 involving maxi cab No. HP-01-1879, is in question. 2. The brief facts of each appeal are given here-in-below:- FAO No. 80 of 2004. 3. The respondents No. 1 to 7 are the widow, sons and daughters of Kapoor Singh, who filed petition, claiming compensation Whether the reporters of the local papers may be allowed to see the Judgment? …2… of Rs.15,00,000/- on account of death of Kapoor Singh due to injuries sustained by him in an accident on 29.10.2002 involving maxi cab No. HP-01-1879 due to rash and negligent driving of the vehicle. The deceased Kapoor Singh aged 50 years was earning Rs.15,000/- per month from agriculture, horticulture, business and as contractor. The respondent No. 8 was the owner, while appellant was the insurer of the vehicle at the time of accident. The petition was contested by the owner of the vehicle by filing reply and he took stand that accident took place due to mechanical defect of the vehicle, which was insured with the appellant. He denied his liability to pay compensation and prayed for dismissal of the petition. The appellant also filed reply and contested the petition and took objection of maintainability of the petition. The driver of the vehicle was not holding valid and effective driving licence at the time of accident. There was no valid registration-cum-fitness certificate of the vehicle at the time of accident. The insurer prayed for dismissal of the petition. The Tribunal, vide award dated 11.12.2003, held that deceased died in the accident involving vehicle No. HP-01-1879 due to rash and negligent driving of the vehicle, which was insured and awarded Rs.4,14,000/- compensation in favour of respondents No. 1 to 7 and against appellant as the vehicle was insured and directed the appellant to deposit the award amount within thirty days, failing which interest at the rate of 9% per annum shall be charged from the date of petition till realization. The award amount was ordered to be …3… apportioned equally amongst the claimants. The insurer of the vehicle has come in appeal. FAO No. 127 of 2004. 4. The respondents No. 1 to 3 are the daughters of Devinder Singh, who filed petition, claiming compensation of Rs.10,00,000/- on account of death of Devinder Singh due to injuries sustained by him in an accident on 29.10.2002 involving maxi cab No. HP-01-1879 due to rash and negligent driving of the vehicle. The deceased Devinder Singh aged 50 years was earning Rs.11,000/- per month from agriculture, horticulture as well as from tailoring work. The respondent No. 4 was the owner while appellant was the insurer of the vehicle at the time of accident. The petition was contested by the owner of the vehicle by filing reply and he took stand that accident took place due to mechanical defect of the vehicle, which was insured with the appellant. He denied his liability to pay compensation and prayed for dismissal of the petition. The appellant also filed reply and contested the petition and took objection of maintainability of the petition. The driver of the vehicle was not holding valid and effective driving licence at the time of accident. There was no valid registration-cum-fitness certificate of the vehicle at the time of accident. The insurer prayed for dismissal of the petition. The Tribunal, vide award dated 28.2.2004, held that deceased died in the accident involving vehicle No. HP-01-1879 due to rash and negligent driving, the vehicle was insured and awarded Rs.3,99,000/- compensation in favour of respondents No. 1 to 3 and against …4… appellant as the vehicle was insured with the appellant and directed the appellant to deposit the award amount within thirty days, failing which interest at the rate of 9% per annum shall be charged from the date of petition till realization. The award amount was ordered to be apportioned equally amongst the claimants. The insurer of the vehicle has come in appeal. FAO No. 417 of 2004. 5. The respondents No. 1 to 3 are mother, brother and sister of Sanjay Kumar, who filed petition, claiming compensation of Rs.6,00,000/- on account of death of Sanjay Kumar due to injuries sustained by him in an accident on 29.10.2002 involving maxi cab No. HP-01-1879 due to rash and negligent driving of the vehicle. The deceased Sanjay Kumar was 15 years of age at the time of accident and looking after his household and holding and earning Rs.7,000/- per month therefrom. The respondent No. 4 was the owner while appellant was the insurer of the vehicle at the time of accident. The petition was contested by the owner of the vehicle by filing reply and he took stand that accident took place due to mechanical defect of the vehicle, which was insured with the appellant. He denied his liability to pay compensation and prayed for dismissal of the petition. The appellant also filed reply and contested the petition and took objection of maintainability of the petition. The driver of the vehicle was not holding valid and effective driving licence at the time of accident. There was no valid registration-cum-fitness certificate of the vehicle at the time of accident. There was violation of terms and …5… conditions of policy. At the time of accident the vehicle was carrying 17 persons including driver as against the maximum sitting capacity of 14. The insurer prayed for dismissal of the petition. The Tribunal, vide award dated 24.9.2004, held that deceased died in the accident involving vehicle No. HP-01-1879 due to rash and negligent driving of the vehicle, the vehicle was insured and awarded Rs.1,00,000/- compensation in equal shares in favour of respondents No. 1 to 3 and against appellant as the vehicle was insured with the appellant and directed the appellant to deposit the award amount within two months, failing which interest at the rate of 9% per annum shall be charged from the date of petition till realization. The insurer of the vehicle has come in appeal. FAO No. 419 of 2004. 6. The respondents No. 1 and 2 are widow and son of Sewa Singh, who filed petition, claiming compensation of Rs.15,00,000/- on account of death of Sewa Singh due to injuries sustained by him in an accident on 29.10.2002 involving maxi cab No. HP-01-1879 due to rash and negligent driving of the vehicle. The deceased Sewa Singh aged 41 years was working as Chowkidar in IPH Circle Reckong Peo and getting Rs.6828/- salary per month. The respondent No. 3 was the owner, while appellant was the insurer of the vehicle at the time of accident. The petition was contested by the owner of the vehicle by filing reply and he took stand that accident took place due to mechanical defect of the vehicle, which was insured with the appellant. He denied his liability to pay compensation and …6… prayed for dismissal of the petition. The appellant also filed reply and contested the petition and took objection of maintainability of the petition. The driver of the vehicle was not holding valid and effective driving licence at the time of accident. There was no valid registration-cum-fitness certificate of the vehicle at the time of accident. There was violation of terms and conditions of policy. At the time of accident the vehicle was carrying 17 persons including driver as against the maximum sitting capacity of 14. The insurer prayed for dismissal of the petition. The Tribunal, vide award dated 1.10.2004, held that deceased died in the accident involving vehicle No. HP-01- 1879 due to rash and negligent driving, the vehicle was insured and awarded Rs.3,31,200/- compensation in favour of respondents No. 1, 2 and against appellant as the vehicle was insured with the appellant and directed the appellant to deposit the award amount within two months, failing which interest at the rate of 9% per annum shall be charged from the date of petition till realization. Out of the award amount, a sum of Rs.2,00,000/- was ordered to be paid to respondent No. 1- widow, while a sum of Rs.1,31,000/- was ordered to be paid to son of the deceased. The insurer of the vehicle has come in appeal. FAO No. 162 of 2006. 7. The respondents No. 1 to 3 are the daughters of Devinder Singh, who filed petition, claiming compensation of Rs.6,00,000/- on account of death of their mother Smt. Ganga Bhagti due to injuries sustained by her in an accident on 29.10.2002 …7… involving maxi cab No. HP-01-1879 due to rash and negligent driving of the vehicle. The deceased Smt. Ganga Bhagti aged 40 years was earning Rs.5,000/- per month from agriculture, horticulture as well as from tailoring work. The respondent No. 4 was the owner, while appellant was the insurer of the vehicle at the time of accident. The petition was contested by the owner of the vehicle by filing reply and he took stand that accident took place due to mechanical defect of the vehicle, which was insured with the appellant. He denied his liability to pay compensation and prayed for dismissal of the petition. The appellant also filed reply and contested the petition and took objection of maintainability of the petition. The driver of the vehicle was not holding valid and effective driving licence at the time of accident. There was no valid registration-cum-fitness certificate of the vehicle at the time of accident. The insurer prayed for dismissal of the petition. The Tribunal, vide award dated 5.3.2004, held that deceased died in the accident involving vehicle No. HP-01-1879 due to rash and negligent driving of the vehicle, the vehicle was insured and awarded Rs.3,03,000/- compensation in favour of respondents No. 1 to 3 and against appellant as the vehicle was insured with the appellant and directed the appellant to deposit the award amount within thirty days, failing which interest at the rate of 9% per annum shall be charged from the date of petition till realization. The award amount was ordered to be apportioned equally amongst the claimants. The insurer of the vehicle has come in appeal. …8… 8. I have heard the learned counsel for the parties and gone through the record. The claimants and the owner of the ill-fated vehicle have accepted the impugned awards, only the Insurance Company of the vehicle has assailed the impugned awards. It has been fairly submitted on behalf of the appellant in each appeal that insurer had not obtained permission under Section 170 of the Motor Vehicles Act, 1988 (for short, the Act). In these circumstances, the appellant could contest the petitions only on statutory defences available to the insurer under the Act, hence insurer cannot assail the impugned awards on the grounds of negligence and quantum of compensation. The learned counsel for the appellant faced with this situation has confined her submissions only on the violation of policy and according to her at the time of accident seventeen persons were sitting in the vehicle as against the permissible limit prescribed in the policy, therefore, insurer is not liable to indemnify the owner of the vehicle. In this judgement evidence and documents from FAO No. 80 of 2004 are being referred. 9. It has been submitted by the learned counsel for the appellant that as per insurance policy Ex. RW 1/C, the sitting capacity of the vehicle was twelve plus one, similarly, as per tourist permit Ex. RW 1/D, the sitting capacity of the vehicle was twelve plus two. In violation of Ex. RW 1/C and Ex. RW 1/D, there were seventeen persons in the vehicle at the time of accident. The vehicle was being plied in violation of terms and conditions of the policy, therefore, the insurer of the vehicle is not liable to pay any compensation. …9… Registration certificate of the vehicle is Ex. RW 1/A and driving licence of the driver Ex. RW 1/B is for driving transport vehicle. 10. Ms. Devyani Sharma has further submitted in view of Kaljang Dorge vs. Dorje Phunchok and another Latest HLJ 2006 (HP) 889 and FAO No. 230 of 2007, titled New India Assurance Company Ltd. Vs. Kaljang Dorge & anr., decided on 5.6.2008, the insurer is not liable to indemnify the owner of the vehicle. She has submitted that in New India Assurance Company Ltd. Vs. Kaljang Dorge & anr., the vehicle was found overloaded with passengers at the time of accident and, therefore, the insurer was exonerated even though at the first instance insurer was directed to deposit the award amount but was given liberty to recover the same from owner and driver of the offending vehicle. She has submitted that in view of aforesaid two pronouncements of this court, in the present case also the insurer is not liable to indemnify the owner of the vehicle. In Latest HLJ 2006 (HP) 889 (supra), it was admitted position that the accident took place due to overloading of the vehicle, which is clear from perusal of para-17 of the judgement. The learned Single Judge ultimately remanded the cases reported in Latest HLJ 2006 (HP) 889 to the learned Tribunal. After remand, the learned Tribunal allowed the claim petitions and appeals were filed in this court, which were decided on 5.6.2008 alongwith FAO No. 230 of 2007. The learned Single Judge in FAO No. 230 of 2007, has held has follows:- “The fact that the accident was the result of overloading and considering the terrain in which the vehicle was being plied, was the direct cause of the accident already stands decided as the …10… judgement(s) having been accepted by the parties, have not been challenged in appeal and have attained finality. On remand, the learned Motor Accident Claims Tribunal has allowed all the appeals and awarded compensation in accordance with law fixing and apportioning the liability on the Insurance Company.” The learned Single Judge in FAO No. 230 of 2007 (supra), has further held that sole cause of accident was overloading which stands established by the evidence on record and, therefore, in those circumstances, it was held that in the first instance the insurance company shall pay the award amount to the claimants and it will be at liberty to recover the amount from the owner and the driver of the vehicle, who were held liable to pay the compensation jointly and severally. The facts in the present case are entirely different. There is no admission of the claimants that the accident took place due to overloading of the vehicle. On behalf of the insurance company, it has been submitted that terms and conditions of the policy have been violated by overloading the vehicle but it is not the case of the insurance company that accident took place only due to overloading of the vehicle at the time of accident and not due to any other reason. 11. In B.V.Nagaraju vs. Oriental Insurance Co. Ltd., Divisional Officer, Hassan 1996 (4) SCC 647, the facts were that nine persons were sitting in the vehicle as against six persons permitted by the policy. On those facts, the Apex Court has held as under:- “It is plain from the terms of the Insurance Policy that the insured vehicle was entitled to carry 6 workmen, excluding the driver. If those 6 workmen when travelling in the vehicle, are assumed not to have increased any risk from the point of view of the Insurance …11… Company on occurring of an accident, how could those added persons be said to have contributed to the causing of it is the poser, keeping apart the load it was carrying…………………. Merely by lifting a person or two, or even three, by the driver or the cleaner of the vehicle, without the knowledge of the owner, cannot be said to be such a fundamental breach that the owner should, in all events, be denied indemnification. The misuse of the vehicle was somewhat irregular though, but not so fundamental in nature so as to put an end to the contract, unless some factors existed which, by themselves, had gone to contribute to the causing of the accident. In the instant case, however, we find no such contributory factor.” 12. The insurance company in all the cases has taken almost similar defence. RW 1 R.K. Sharma, Branch Manager of the National Insurance Company has appeared as a witness. He has nowhere stated that accident took place due to overloading of the vehicle. He has not stated that in absence of overloading possibly accident could not have taken place. The statement of RW 1 R.K. Sharma makes it clear that insurance company is not imputing cause of accident to the overloading of the vehicle at the time of accident. The insurance company has projected the case that permitted capacity of the vehicle was 13 or 14 but vehicle was carrying 17 persons at the time of accident. Thus according to the insurer the overloading was of 3 or 4 persons but such overloading has not been proved to be the fundamental cause of accident. In these circumstances, the insurance company cannot escape the liability to pay the compensation to the claimants when the ill-fated vehicle was duly insured with it. …12… 13. The further question in the present appeals is whether overloading of the vehicle by passengers is a statutory defence available to the insurer. This question came up for consideration before the then Hon’ble Chief Justice of this Court in National Insurance Co. Ltd. Vs. Reena Devi and others 2005 ACJ 1306, wherein it has been held as follows:- “Whether carrying of passengers more than the prescribed or permitted seating capacity is a ground, which can be taken by an insurer to absolve itself of its liability to pay has to be decided only with reference to the conditions finding a mention in clauses (a) and (b) of sub-section (2) of Section 149 of the Act. The legislature has very advisedly limited the grounds of defences only to such breaches of specified conditions of the policy which the legislature itself has mentioned in clauses (a) and (b) of sub-section (2) of section 149 of the Act. In clause (a), there are as many as four situations which are related to a condition excluding the use of vehicle as well as the condition excluding the driving of the vehicle by an unauthorized person or a condition excluding liability for the injury caused or contributed by conditions of war, civil war, riot or civil commotion. Similarly, in clause (b), the legislature has advisedly laid down and prescribed that an insurer is entitled to defend the action if the policy of insurance is void on the ground that it was obtained by non-disclosure of a material fact or by a representation of a fact which was false in any material particular. It is, therefore, manifestly clear that the overloading of a bus even though it might be a breach of a condition of the registration certificate or the route permit, yet cannot be made the basis of a defence by an insurer because such a breach does not find any mention in either clause (a) or clause (b) of sub-section (2) of section 149 of the Act. By now, through a catena of pronouncements of law by various judgements of the Apex Court it has conclusively been established that an insurer is ent1itled to avoid its liability to pay only if its defences fall within the ambit of sub- section (2) of section 149 of the Act and that an insurer, otherwise than by section 170 of the Act, cannot be permitted to traverse beyond these limited defences available to it under section 149 (2) of the Act.” …13… In view of National Insurance Co. Ltd. Vs. Reena Devi’s (supra), the appellant- insurer of the ill-fated vehicle is not entitled to plead and avoid its liability to indemnify the owner of the vehicle on the ground that at the time of accident, the vehicle was overloaded with passengers than the permitted limit in the policy. 14. Thus taken from any angle, the learned Tribunal has rightly appreciated the material on record. On behalf of the appellant, no case for interference is made out in any appeal. 15. No other point was urged. 16. As a result of above discussion, all the appeals being FAO Nos. 80, 127, 417, 419 of 2004 and 162 of 2006, are dismissed with no orders as to costs. December 19, 2008. ( Kuldip Singh ) (Hem) Judge. …14… (i) 1. FAO No. 80 of 2004. National Insurance Company Ltd. ….Appellant. vs. Smt. Mahendri Devi & ors. …. Respondents. For the appellant: Ms. Devyani Sharma, Advocate. For the respondents: Mr. Vinay Thakur, Advocate, for respondents No. 1 to 7. Mr. Arvind Sharma, Advocate, for respondent No.8. 2. FAO No. 127 of 2004. National Insurance Company Ltd. ….Appellant. vs. Kumari Gyan Devi & ors. …. Respondents. For the appellant: Ms. Devyani Sharma, Advocate. For the respondents: Mr. Jagdish Vats, Advocate, for respondents No. 1 to 3. Mr. Arvind Sharma, Advocate, for respondent No. 4. 3. FAO No. 417 of 2004. National Insurance Company Ltd. ….Appellant. vs. Smt. Vinay Kumari & ors. …. Respondents. For the appellant: Ms. Devyani Sharma, Advocate. For the respondents: Mr. B.N.Sharma, Advocate, for respondents No. 1 to 3. None for respondent No.4. 4. FAO No. 419 of 2004. National Insurance Company Ltd. ….Appellant. …15… (ii) vs. Smt. Yankar Dolma & ors. …. Respondents. For the appellant: Ms. Devyani Sharma, Advocate. For the respondents: Mr. O.P.Negi, Advocate, for respondents No. 1 and 2. 5. FAO No. 162 of 2006. National Insurance Company Ltd. ….Appellant. vs. Kumari Gyan Devi & ors. …. Respondents. For the appellant: Ms. Devyani Sharma, Advocate. For the respondents: Mr. Jagdish Vats, Advocate, for respondents No. 1 to 3. Mr. Arvind Sharma, Advocate, for respondent No. 4. *** …16… IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA FAO No. 127 of 2004. Judgement reserved on: 14.11.2008. Date of decision: 19.12.2008. National Insurance Company Ltd. ….Appellant. vs. Kumari Gyan Devi & ors. …. Respondents. Coram The Hon’ble Mr. Justice Kuldip Singh, Judge. Whether approved for reporting?2 For the Appellants : Ms. Devyani Sharma, Advocate. For the Respondents : Mr. Jagdish Vats, Advocate, for respondents No. 1 to 3. Mr. Arvind Sharma, Advocate, for respondent No. 4. Kuldip Singh, Judge. For judgement, see judgement of date rendered in FAO No. 80 of 2004, titled National Insurance Company Ltd. vs. Smt. Mahendri Devi & ors. December 19, 2008. ( Kuldip Singh ), (Hem) Judge. Whether the reporters of the local papers may be allowed to see the Judgment? …17… IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA FAO No. 162 of 2006. Judgement reserved on: 14.11.2008. Date of decision: 19.12.2008. National Insurance Company Ltd. ….Appellant. vs. Kumari Gyan Devi & ors. …. Respondents. Coram The Hon’ble Mr. Justice Kuldip Singh, Judge. Whether approved for reporting?3 For the Appellants : Ms. Devyani Sharma, Advocate. For the Respondents : Mr. Jagdish Vats, Advocate, for respondents No. 1 to 3. Mr. Arvind Sharma, Advocate, for respondent No. 4. Kuldip Singh, Judge. For judgement, see judgement of date rendered in FAO No. 80 of 2004, titled National Insurance Company Ltd. vs. Smt. Mahendri Devi & ors. December 19, 2008. ( Kuldip Singh ), (Hem) Judge. Whether the reporters of the local papers may be allowed to see