IN THE HON’BLE HIGH COURT OF CHHATTISGARH AT BILASPUR w p 227 No iW—mow PETITIONER' ‘ BaJaJ Alhanz General Insurance Compéhy v ' > Limited, Through Branch Manager; Shiv‘ j Mohan‘ ‘Bhavan Vidhan “Sabhai Marg, ‘ Pandrl Ralpur Tahs11 & Dlstt Ralpur (C G ) {Insuret} \ ‘ VERSUS i 1; REs?éN15ENTs _ ' / 1) Dasru Patel lS/o Nandram atel age P d about 32 years, R/o V1llage Sendarl Post 'Konl Than Kom Tahs11 8L Dlstrxct r B11aspur (C G ) {Clalmant} ‘Santosh Kumar Shyam S/o Smmar Smghz r aged about 25 years, R/o- Vlllage S1s ‘ ‘ 1 Ghork1para, }Thana Ratanpur D1str1ct Bllaspur (C G ) {Dnver} - v ' 3) ' :Rakesh KumarAgrawal SV/o Not Known to 'the Petitioner, R/o (M‘.R.B L) TP Nagar Korba District Korba (C G ) {Owner} Pubhc Utlhty Permanent Lok Adalat W ”“BllaahurlC G State of. ChhattiSgarh, through the Secretary, Department of Law and Legislativ Affairs, Mantralaya, D.K.S; Bhawan, Raipur (C-G.) t1oned heremabove 1n the cause n t1 3‘ 3' HIGH COURT OF cmTTISGARHl BILASPU w P 1221) No. 292(2009. PcNER I BaJaJ Alhanz General I‘ Insurance Co pany Lnmted Versus _ RESPONDENTS Dasm Patel agad others w.P‘. (221} No. 41012od9’ PETITIdNER ‘ Bajaj Alliianz General Insurance Company Lnmtéd Versus i f REspowEm‘s ’ .Janak Kori a§1d others . ‘\ I SB' HONfBLE SHRI N K. AGARWAL, J T ' PRESEN ’ Shn Sachm Smgh Rajput Advocate, for the peuuoner Shn A V Sndhar Adv ior the respondent No 1 ' Shn Santosh T1war1, Adv for the respondent No 3 Shrl AkhJl Agrawal Panel Lawyer for the State ORAL ORDER ' ,, (284.2011) _ . \ : 1. This order shall govern disposal of aboVe ‘two writ petitions. V 2. Baja} Alhanz General Insurance Company L1m1ted who 1s ' ,_ ' , peutloner m both the wr1t petmons 1s challengmg A 3ur1sd1ct10n of Permanent Lok Adalat to entertam and adjudlcate claJm peutmns under the Motor Vehlcles Act, 1988 (hrlefly ‘the Act of 1988’) 3. For proper apprematlon of legal 1ssues mvolved 1n the . case, Ythe facts V111 W P (227) o 292/2009 1s set down hereunder - ‘ l Respondent No 1 mstltuted a clann petitlon before the I .. ' f f; .. Permanent Lok Adalat Bllaspur under Secuon 22—A of the V Legal éemces Authorlty Act 1987 (bneily ‘the Act of a, I / R ETITI ” A claiming amount f Rs. 5,50,000/— as 1987:? compensation for the injuries sustained by him in the t motor accident dated 1-3—2008 againsi the driver, Owner and netiu’oner i.e. insurer of the truck bearing registration No; CGo7 (3/7247. After receipt of notice, the petitioner/hisurance company raised a preliminary objection challengng jurisdiction of Permanent Lok Adaiat to entertain and adjudicate the c1a1m under the Act of 1988 Vlde unpugned order the Permanent Lok Adalat dismissed the objectxon raised by the petitioner. Hence this petition. 4. Shri RaJput learned counsel for the petitloner would submlt power is not vested Wlth respondent No 4 to entertam and adjudlcate and award compensauon 1n respect of mjurles sustained in an acc1dent Acmdent ls a tortuous act and 1n order to obtain compensatlon, case has .to: be filed before motor acc1dent claims tribunal specially constituted for the purpose under Section 165 of the Act of 1988. He' would further submit, learned Permanient Lok Adalat has no jurisdiction to pass any order or award where parties do not agee for compromise r settlement of their dispute It was further contende there 1s no priVity of contract between respondent No 1 and the petitioner Hence it cannot take benent of Section 22—A of the Act of 1987. Respondent No 1 1s a third party to the §contract of insurance between the petitioner and the respondent No. 3. Hence provision of Section 22 of the Act of 1987 would, not apply. On the otherhand, Shri S.K. Tiwari, learned counsel appearing for the respondent No. 3 would suppdrt the ' . order impugned I have heard learned counsel for the parties and perused 'the order impugied re i e r o d H g. The core quesuon arises for dec131o maklng ls whether th er L conshte u Sec 22-B of te Act of 987 has Jumdltmn to ntetam and h 1 sc er l uder th A 1 ape V o 9 L a n ferr sc o tr h s alreay pendmg 1n the court or hlch may be rogh o r exc o ar ea ce t b e b f sel Under Chtr I f Act of 187 ok Adalts have bee coned Jmdlnon to reslve y mate whic i d w but befre the cout ept the cases r mttes rltmg to an offen no compoundale undr any law y means o amlcable ttement Chaper VI—A f the Act was subtitutd by amedmen he Legl erv1ces Athomes A bough aut 1n e t o se nt of t a S ur ct rt bo th . a m ran Adlat year 2002 Secuon 22A() defes Pement Lok a as ne‘establis'hed undr sb—serm o Sctlon 22B e uon (1) f e . ub lt er Sectmn 22A(b) defmes the Plic; Utiiy Svices as follows - ( ) transport sermce for the carnage of passengers or goods by alr, road or water, or (n) postal telegraph ‘or telephone semce, or (m) supply of power, hght or water to the pubhc by any estabhshment or (1v) system of pubhc conservancy or samtatmn, or (v) [serwce 1n hospltal or d1spensary, or (v1) msurance S€IV1C6 ."5 t 1 {:4 10. Sectihn 22-B provides for the establishment of a Permanent Lok Adalat Sectlon 22B(1) reads as follows - , ‘“22B(1) Notw1thstandmg anythmg contamed m Secuon 19 the Central Authorlty or as the case may be, every State Authorlty shall by notification, estabhsh Permanent Lok Adalats at such places and for exerc1s1ng such Jumsdlctlon 1n respect of one or ' lmore pubhc unhty services and for such areas as ,may be speafled m the notificatlon l X t I _\\ z e Pmanent ok Adalat tuli nder tlon ad3ud1cate a motor acoldent comp satlon calm n e ct of 988 Secnon 22C prov1des for cogm lce‘ of cases by Permanent Lok Adalat Secuon 22C provides that Permanent Lok Adalat should permanently settle the pomts 1n d1spute between the partles and try to effect conc111at10n between them But a dlstuigmshmg feature 1n so ‘far as the powers of the Permanent Lok Adalat is concerned 1s what flows out of Secuon 230(8) and the same reads as follows “22C( ) Where the parnes fa11 to reach at an agreement under sub—secnon (7), the Permanent Lok Adalat shall 1f the d1spute does not relate to any oh‘ence, dec1de the dlspute Sectlon 146 of M V Act under Chapter XI mandates that no person shall use, except as a passenger, or cause or allow any other person to use, a motor vehlcle m a pubhc place, unless there 1s 1n force m relatwn to the use of the vehlcle by that person or that other person, as the case may be, a pohcy of msurance complymg w1th the requlrements of th1s Chapter Sechon 147 of the M V Act deals w1th the requn‘ement of pohc1es of msurance and l1m1ts of hablllty Sectlon 149 of MV Act shows that msurer 1s ent1tled to defend the actxon on the grounds enumerated m sub sectron (2) Secuon 165 of M V Act found ‘m Chapter XII of M.V. Act, 1988 prov1de for constitution of Claims Tribunal A State Government may, by notlfwatlon 1n the Offic1al Gazette, constltute one or ' more Motor Acc1dents Claims Tnbunals for such area as may be specrt'led 1n the notification for the purpose of adjud1cat1ng upon claims for compensatlon 1n respect of acoldents mvolvmg the death of or bodily mjury to, persons ansmg out of the use of motor vehicles, or damages to any property of a th1rd party so amsmg or both Under Section 166 of M V Act apphcamon for compensation could be lodged Sectmn 167 of the Motor Vehicles Act, gves an option regardmg claJms for loompeinsation m certam cases It promdes that I notwithstanding anything contained in the Workmen’s 'Compénsation Act, 1923, Where the death of, or bodily injuryf to, any person gves rise o a claim for compensation under this Act and also under the Workmen’s Compensation Act, 1923, the person entitled- to eonipensation may Without prejudice to the provisions of Chapter X claim such compensation under either of ”those Acts but not under both. Award could be passed by the Motor Accident Claims Tribunal under Section 168 of M V Act The procedure that is contemplated for holding any mquiry under Section 168 of M V Act is prOVIded under Section 169 of the M.V. Act which would mandate ‘ that a claim petition shall follow rules that may be made and folloWs such summary proceedings as it thinks ht. The insurer could be impleaded as party to the proceedings under Section 170 of M V Act Section 173 of the M V Act 1988 would deal w1th the prowsmns relating to appeals that could be iiled against the Judgnents and awards passed by the motor Acc1dent Claims Tribunal. Section 175 of the ‘ Motor Vehicles ' Act,’ bars the jurisdiction of the Civil Courts to go into the claim for compensation in a motor vehicle acc1dent It states that where any claims Tribunal has been constituted for any area, no CiVil Court shall have Jurisdiction to entertain any question relating to any claim for compensation which may be adjudicated upon by the Claims Tribunal for that area, andgno injunction in respect of any action taken or to be taken by or before the Claims Tribunal in respect of the claimi‘for Compensation shall be granted by the Civil Court. Section 176 of M.V. Act would mandate grant of power to State Government to frame rules for the piirpose 'of carrying into eh‘ect the provisions of Section 165 to' Section 1’75 of M.V. Act. ' ‘ V. 13.! The Supreme Court in the case of National Insurance CompanylLtd v Nicoletta Rohtagi, reported in [2002 7 () $60456], interpreting the provisions of Motor Vemcles Act and the mtentxon of the legxslature as to protect the third party rlghts and not that of the 1n urer at paragraph 13 has held as under '“Under Secuon 96(2) of 1939 Act h1ch corresponds i éto Secuon 149(2) of 1988 Act an msmance company ° Ehas no rlght to be a party to an acnon by the Injured _ person or dependants of deceased against the insured However, the said provifions gives in the msurer the nght to be made a party to the case and ito defend 1t It 1s therefore, obvmus that the sald arlght 1s a creature of the statute and 1ts content depends on the prov1810ns of thei statute After the msurer has been made a party to a case or clann the questlon anses what are the defenses avmlable to 1t under the Statute The language employed 1n enactmg sub sect10n (2) of Sect10n 149 appears to be p1a1n and sunple and there 1s no amblgtuty 1n 1t It shows that when an msurer 1s Impleaded and has been given not1ce of the case, he 1s entitled to defend ' the actwn on the grounds enumerated 1n the sub- sectlon, namely sub secuon (2) of Secuon 149 of 1988 Act and no other gound 1s avallable to hlm The msurer ls not allowed to contest the claJm of the InJured or he1rs of the deceased on other ground Whlch 1s available to an msured or breaoh of any other condmons of the pohcy which do not find place 1n sub-section (2) of Section 149 of 1988 Act If an insurer 1s pernntted to contest the claim on other , grounds it would mean adding more gounds of contest to the Insurer than what the statuette has specifically provided for ‘ ' ' ‘14 The statutory hability of the Insurance Company to satisfy the third parties, ie a party who is not a party to a a contract of insurance 1s found 1n Section 149 of M V A i x ‘ . i A i r \\ ct It casts a duty on the msurer to sausfy e judgments and 7 awards agamst persons msured 1n respect of thJrd party nsk The headmg of the sa1d section ls Slgmflcant The duty ls to sausfy Judgment and awards and not the clmm of the thud partles If the 01mm of the thlrd party 1s adjudlcated and the judgment and award 1s passed then, the msurer shall pay to the person ent tled to the beneiit of the decree, any sum not exceedmg the sum assured payable thereunder, as 1f he were the Judgment debtor, respect of the habmty together w1th any amount payable v 1n respect of the costs and any sum payable 1n respect of mterest on that sum by Vlrtue of any enactment relatm mterest on Judgnents So the condmon precedent for Judgment and award or decree T111 such ume, there 1s no ' uch payment by the msurer 1s the passmg of the hab111ty on the msurer under the Motor Vehlcles Act. Sub- sectlon (2) of Secnon 149 prov1des that as the msmer has to pay the amount awarded 1n the Judgment or award the 1nsurer shall be made party to such proceedmgs before ' the commencement of the proceedmgs Once the msurer ls made party to such claJm agamst the msured the t under the aforesald _ prov151ons to defend the acuon on any of the gounds of a specrt‘led condltlon of the pohcy prowsmn are breach by non—dlsclosure t 0t matenal fact or by representatlon of fact wh1 h was false m sum matenal partlculars Thls 1s a msurer has been glven the ngh grounds set out 1n the sald menuoned therem The that 1t was obtained or the pohcy bemg v01d on the ground efence agamst the msured and not agamst the clannant However Sectaon 170 makes 1t clear that 1n the course of between the person makmg the cla1m and the person any enquuy on such c1a1m pet1t10n, 1f there ls collus1on a’vagamst whom the c1a1m 1s made, d or to the contest person the agalnst claim, Itesurer has been conferred the nght to contest the whom the cla1m 1s made has falle hun ’ é? ”Wm #géaW ”§g%g “v I,“ ww clmm on all or any of the grounds that are available to the person agalnst whom the clalm has been made. The‘Supreme v. Pre'mlata Shukld, Court [(2007) m case 13 of SCC Onental 476, Insurance hasheld in Co. para Ltd, 9 and 10 of its judgment as under' L ‘ ‘ “9 Where an acc1dent occurs owmg to ras jand neghgent drlvmg by the dnver of the vehlcle, resultmg m sufferance of 1njury or death by any thn‘d party the dnver would be Alable to pay compensation therefor Owner §of the veh1cle m terms of the Act also becomes hable under the 1988 SAct In the event veh1c1e ls msured whlch 1n the case of a tlnrd party havmg regard to sub secuon ( ) of Secuon 147 of the Act 1s mandatory 1n character, the msurance company would statutorily be enJomed to mdemmfy the owner 10 The msurer, however, would be hable to relmburse the Insured to the extent of the damages payable by the owner to the clamlants subject of course to the hmlt of 1ts hab111ty as lald down 1n the Act or the contract of msurance Proof of rashness and neghgence on the part of the drlver of the tvehlcle, 1s therefore, sme qua non for mamtalnmg an apphcatlon under Secuo _ 166 of the Act.” the MVC Act the Therefore under the prov1s1ons of clann has to be preferred agamst the msured and the dnver Insurance Company ls also added as a party by g;-v1Itue of Secuon 149(2) of the Act No claJm agalnst the r p Ilnsurance Company ls maJntamable w1thout the owner of cle or the drlver of the vehlcle bemg made a party the vehl v ‘j L h n to fhe proceedings. Whereas the claim or compensation is validly maintainabls against the insured afld the driver witliout makirig the Insurance Company, a party. Th Tribunal consututed under the C Act haS been conferred the Jurisdiction to entertam And adjudicate such claims. But, the Permanent Lok Adalat constituted under the Act has jurisdiction to entertain, conciliate and if it fails adjudicate a claim, only against a public, utility service. It cannot entertain and adjudicate any clai against a private individual like the insured and the driver The dispute should be between a public utility serVice and any party to the said dispute Therefore, dispute With reference to Insurance; serVice necessaril means; the claim is against the insurance company. The claiin for compensation for the death of a victim of a road accident or for the injury sustained in an accident cannot be characterizedas petty claims. It is a substantial claim. The Parliament has enacted the Motor Vehicles Act, 1988 specially constituting the Tribunal .to adjudicate such claimsj and has specifically excluded the jurisdiction of th Civil Courts to entertain such claims. A statutory appeal is providied against such adjudication to the Hon’ble High Court Normally, such claims are decided on the basis of eVidence recorded both oral and documentary The Permanent Lok Adalat is broadly meant to deC1de petty casesg When the conc111ation fails, the Permanent Lok Adalat has been vested with the power to decide the case on merits. However, no appeal is provided against such adjudication and the award passed by the Permanent Lok Adalat has been made final. It is in this back ground as is ' clear from the aforesaid statutory provisions the claims for compensation under the Motor Vehicles Act is not princ1pally against the public utility serv1ces but agains the insured and the driver of the vehicle and only in the if x l e m y e / t fh th juma o ec d exet of e dgent/awrd r drae' is passe, the Insurance Company is_ liable to pay th said amount. In mew of above, 1n the cons1dered o Imon of thls Court the Permanent Lok Adalat constltute under Secuon 22—B v of (the Legal Semces Authonues ct, 1987 has no Junsdlctlon to entertam and adjudlca the motor accident compensation claim under the Motor Vehicles Act, 1988. Fori the reasons mentioned hereinabove, the writ petitions arei‘allowed. The impugied orders are All the claims preferred by the claimants are rejected With liberty to them to prefer claim before motor acoldent claims tribunal constituted under Sectlon , 165 of the Motor Vehicles Act, 1988. 20. Parties to bear their own costs. I l quashed. High Court registry ls directed to send a copy of this order to all the Permanent Lok Adalat 1n the State for their guidance Sd/- v it» N.K.Agarwal Judge W