IN THE HIGH COURT OF DELHI AT NEW DELHI MAC. APP. No.35/2008 Judgment delivered on: January 21, 2008 National Insurance Co. Ltd. ..... Appellant Through: Mr.Pradeep Gaur, Adv. versus Mahipal Singh & Ors. ..... Respondents Through: Nemo CORAM: HON'BLE MR. JUSTICE KAILASH GAMBHIR, 1. Whether the Reporters of local papers may be allowed to see the judgment? Yes 2. To be referred to Reporter or not? Yes 3. Whether the judgment should be reported in the Digest? Yes KAILASH GAMBHIR, J. Oral: * The appellant, National Insurance Company Ltd., insurer of the offending vehicle has preferred an appeal assailing the impugned order dated 05.07.2007 passed by the learned MACT. The impugned award has arisen out of the claim petition, viz., Suit no. 16/2006, filed by respondent No.1 against the appellant as well as against respondent Nos.2 & 3 claiming MAC APP. No. 35/2008 page 1 of 7 compensation for the injuries sustained by Shri Mahipal Singh, respondent no. 1. The brief facts which are necessary for deciding the present appeal inter alia are that Shri Mahipal Singh respondent No.1 sustained injuries on 20.10.2005. On 20.10.2005 Shri Mahipal Singh was waiting near Kabristan of Boulward, Kashmere Gate, Delhi, for a city bus of route no. 205 for going to Ashok Nagar, Shahdara. A Maruti Car bearing registration no. DL 2C L 8834 being driven in a rash and negligent manner by Sh. Jawahar Singh came from the direction of Tis Hazari and hit him. Due to which he sustained injuries. The Tribunal after taking into consideration the facts of the cases as well as evidence led by the parties had passed an award in the sum of Rs. 3,43,500/- along with interest at the rate of 8% per annum payable from the date of the institution of the petition till the date of realization. The said order passed by the Tribunal is now under challenge in the present appeal. I have heard learned counsel for the appellant at considerable length. The appeal is liable to be dismissed at the admission stage itself as the very maintainability of the appeal is in dispute. The appellant cannot assail the findings of the Tribunal on the quantum of compensation as determined by the Tribunal. The appellant had not taken over the defence MAC APP. No. 35/2008 page 2 of 7 of the owner and driver as envisaged under Section 170 of the Motor Vehicles Act and, therefore, is debarred from challenging the impugned award so as to assail the findings of the Tribunal on the quantum of compensation. Sh. Pradeep Gaur, counsel for the appellant strongly disputes this position and contends that the insurer cannot be rendered remedlyless especially in a case where the Tribunal has awarded an excessive amount of compensation in favour of the claimants ignoring all basic principles of law for the award of compensation. Counsel for the appellant has also placed reliance on the judgment of the Supreme Court reported in 2007 (9) Scale 216, New India Assurance Company Ltd. Vs. Smt. Shanti Pathak & Ors. to contend that the Apex Court had interfered to lower down the compensation amount even in a case where the insurer had not taken any permission from the Court under Section 170 of the Motor Vehicles Act. Counsel for the appellant also contends that the Hon'ble Supreme Court has already referred the said issue of lack of competence of the insurer to assail the findings of the Tribunal on the ground of quantum of compensation and negligence to a larger Bench and, therefore, this Court may await the decision of the Supreme Court in this regard. Motor vehicle accident claim is a tortious claim directed against tortfeasors who are the insured/owner and the driver of the vehicle, the MAC APP. No. 35/2008 page 3 of 7 insurer comes in to the picture as a result of the statutory liability created under the Motor Vehicles Act. The legislature intended and has ensured by enacting Section 149 of the Act that the victims of motor vehicle accident are fully compensated and protected. It is for that reason the insurer cannot escape from its liability to pay compensation on any exclusionary clause in the insurance policy except those specified in Section 149(2) of the Act or where the condition enshrined in Section 170 is satisfied. Right of appeal is a creature of statute. The Parliament, while enacting Sub-section (2) of Section 149 only specified some of the defences which are based on conditions of the policy and, therefore, any other breach of conditions of the policy by the insured which does not fall under Sub-section (2) of Section 149 cannot be taken as a defence by the insurer. Had it been the intention of the Parliament to include the breach of other conditions of the policy as a defence, it could have easily provided for ‘any breach of conditions of insurance policy’ in Sub-section (2) of Section 149. But it is not the case, since the legislator has enumerated specifically the grounds of defences available to the insurer. If the insurer is permitted to take any other defence other than those specified in Sub-section (2) of Section 149, it would mean we are adding more defences to insurer in the statute which is neither found in the Act nor was intended to be included. MAC APP. No. 35/2008 page 4 of 7 After having given my thoughtful and conscious consideration to the issue involved in the present case, I am of the view that the issue is no more res integra as in National Insurance Co. Ltd., Chandigarh Vs. Nicolletta Rohtagi & Ors., (2002) 7 SCC 456 and National Insurance Co. Ltd. Vs. Mastan & Anr., (2006) 2 SCC 641, etc., the Hon'ble Supreme Court has authoritatively held that in the absence of permission being sought from the Court as envisaged under Section 170 of the Motor Vehicles Act, the insurer has no right to file an appeal to challenge the quantum of compensation or finding of the Tribunal as regards the negligence or contributory negligence of offending vehicles is concerned. It would be appropriate to refer to Section 170 of the Motor Vehicles Act as under:- “170. Impleading insurer in certain cases- Where in the course of any inquiry the Claims Tribunal is satisfied that - (a) there is collusion between the person making the claim and the person against whom the claim is made, or (b) the person against whom the claim is made has failed to contest the claim, It may, for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaded as a party to the proceeding and the insurer so impleaded shall thereupon have, without prejudice to the MAC APP. No. 35/2008 page 5 of 7 provisions contained in sub-section (2) of section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made.“ It is an admitted case that no such permission under Section 170 of the Motor Vehicles Act was sought by the appellant which clearly means that the procedure laid down under Section 170 of the Motor Vehicles Act was not followed. In the judgment of the Supreme Court reported in (1998) 3 SCC 140, Shankarayya Vs. United India Insurance Co. Ltd., the Supreme Court has held that the insurance company when impleaded as a party by the Court can be permitted to contest the proceedings on merits only if the conditions mentioned in Section 170 are found to be satisfied and for that purpose the insurance company has to obtain an order in writing from the Tribunal and such an order should be a reasoned order of the Tribunal. In such circumstances unless the said procedure is followed, the appellant insurer cannot have a wider defence on merits than what is available to it by way of a statutory defence. Ralevant part of Para 4 of the said judgment in this regard is referred as under: - “4. It clearly shows that the Insurance Company when impleaded as a party by the Court can be permitted to contest the proceedings on merits only if the conditions precedent mentioned in the section are found to be satisfied and for that purpose the Insurance Company has to obtain order in writing from the Tribunal and which should be a reasoned order by the Tribunal. Unless that procedure is followed, the Insurance Company cannot MAC APP. No. 35/2008 page 6 of 7 have a wider defence on merits than what is available to it by way of statutory defence. “ In view of the said legal position, I cannot appreciate the argument of counsel for the appellant that even without seeking permission of the Court as required under Section 170, the Appellant can proceed with the appeal. Once the application under Section 170 of the Motor Vehicles Act was preferred by the appellant before the Tribunal for taking over the defence of an owner or driver, the Tribunal is required to pass specific order and that too a reasoned order as per the observations of the Supreme Court referred above and, therefore, in the instant matter the argument of counsel for the appellant cannot be appreciated that non-filing of an application under Section 170 of the Motor Vehicles Act by the appellant in this regard is no bar in preferring present appeal. In the light of the above discussion, I do not find any merit in the submission of counsel for the appellant. The judgment cited by the counsel in Shanti Pathak's case (supra) has not dealt with the said legal proposition and, therefore, the same is not applicable in the facts and circumstances of the present case. There is no merit in the appeal and the same is dismissed. January 21, 2008 KAILASH GAMBHIR, J. MAC APP. 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