Case: Ramchandra Vs. Regional Manager United India Insurance Company Ltd

claimant is not entitled to any compensation beyond the extent of liability under the Workmens Compensation Act and the respondent/insurance company had not taken the alternative plea either before the tribunal or the High Court that in case the claimant is held entitled to compensation beyond the extent of liability under the Workmens Compensation Act, the same was not payable as no extra premium was paid by the insured/owner under the policy of insurance. The insurance company had failed to raise any plea before the courts below i.e. either the Motor Accident Claims Tribunal or the High Court and it did not even contend that in case the claimant is entitled to any compensation beyond what was payable under the Workmens Compensation Act, it is the insured owner who was liable to pay as it had no contractual liability since the insured/owner of the vehicle had not paid any extra premium. Thus, this plea was never put to test or gone into by the Motor Accident Claims Tribunal since the insurance company neither took this plea nor adduced any evidence to that effect so as to give a cause to the High Court to accept this plea of the insurance company straight away at the appellate stage. 24. Consequently, the High Courts view impliedly holding that the claimant/appellant was not entitled to any compensation under the Motor Vehicles Act beyond the entitlement under the Workmens Compensation Act so as to leave it open to the Respondent/Insurance Company to realise it from the owner of the vehicle at the belated stage of appeal before the High Court when the respondent/insurance company had failed even to urge the alternative plea regarding non-payment of extra premium by the owner of the vehicle and had even reconciled to the fact that the owner of the vehicle had failed to appear in spite of service of notice, is not fit to be sustained. 25. At this stage, we deem it appropriate to take note of an important step which the insurance company generally fail to take and that is related to non appearance of the owner of the vehicle in spite of service of notice. The insurance companies although contend before the Motor Accident Claims Tribunal and even at the appeal stage that it is the owner of the vehicle which is liable to bear a part or the entire liability of making the payment of compensation to the claimant in view of the nature of policy, or even due to invalid licence by the driver of the owner of the vehicle, the insurance company fails to lead any evidence to establish as to how the owner and not the insurance company is liable to pay the compensation and even submits to non appearance of the owner of the vehicle whose appearance is vital in view of inter se contest between the owner of the vehicle and the insurance company. In absence of the owner of the vehicle, when the Motor Accident Claims Tribunal or the High Court leaves it open to the insurance company subsequently to realise the amount from the owner of the vehicle by instituting a fresh proceeding in view of the ratio of the case of General Manager, Kerala State Road Transport Corporation, Trivandrum Vs. Sussama Thomas, (1994) 2 SCC 176 , it gives rise to a fresh proceeding between the owner and the insurance company putting unnecessary burden on the Motor Accident Claims Tribunal to try the issue all over again. In fact, if the insurance company were to succeed in establishing by leading cogent evidence at the initial stage itself before the Tribunal that it is the owner of the vehicle which is liable to pay even if the evidence is ex parte in nature, it would at least facilitate the issue in the subsequent proceeding when the insurer initiates proceeding for realising the amount from the owner/insured. But in absence of such evidence, the insurer/companies are a loser and enures advantage to the owner who happens to gain by choosing not to appear. The Insurance Companies would fair better if they were to address this issue before the Tribunal itself instead of becoming wiser at the stage of appeal. What is wished to be emphasized is that if the owner chooses not to appear before the Tribunal although his appearance is necessary in a given case, the insurance company would do well instead of acquiescing with their absence to their detriment giving an upper edge to the owner at their own peril. 26. In the instant matter, we have noted that the High Court although had granted liberty to the insurance company to realise the amount from the owner of the vehicle, it failed to record expressly that the respondent insurance company shall pay the amount to the appellant/claimant determined by the Motor Accident Claims Tribunal although impliedly the High Court has not denied the amount to the claimant/appellant. But in absence of a categorical direction to the respondent/insurance company to pay the entire amount to the appellant as determined by the Motor Accident Claims Tribunal, the appellant is bound to confront impediments in realizing the amount. Hence, the direction of the High Court is clarified to the extent by recording that the respondent/insurance company shall pay the balance amount also beyond Rs.32,091/- along with interest to the Claimant expeditiously but not later than a period of six weeks from the date of receipt of this order. 27. We are , thus, pleased to hold that the judgment and order of the High Court which impliedly held that the employee/claimant is entitled to compensation only under the Workmens Compensation Act and not under the Motor Vehicles Act stands set aside and the liberty granted to the Respondent/Insurance Company to realise the amount from the owner without a corresponding direction to the Respondent/Insurance company to pay the amount to the Claimant/Appellant making the appellant liable to realise it from the owner of the vehicle stands modified as indicated hereinbefore.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]A perusal of the aforesaid judgment and order of this Court thus indicate that this Court has clearly held that the liability to pay compensation in respect of death or bodily injury to an employee should not be restricted to that under the Workmens Compensation Act but should be more or unlimited. However, the determination would depend whether a policy has been taken by the vehicle owner by making payment of extra premium and whether the policy also contains a clause to that effect18. Thus in so far as the view of the High Court is concerned to the extent that the compensation would be restricted to be paid only to the extent which is payable under the Workmens Compensation Act by making a sweeping generalisation, the same is clearly contrary to the view taken by this Court even in the judgment and order on which reliance has been placed by the counsel for the respondent-insurance company as it is sufficiently clear and unambiguously laid down which is recorded hereinbefore that the compensation payable to the employee cannot be restricted merely under the Workmens Compensation Act and it can be expanded provided the contractual document which is the policy of insurance incorporates such clause regarding the premium to be paid taking into account the nature of the policy19. In the light of the aforesaid legal position, it is clear that the High Court was not correct in holding that the claimant/appellant was not entitled to any compensation over and above the liability under the Workmens Compensation Act and hence the direction issued by the High Court that the appellant/insurance company, respondent herein, will be liable to pay only Rs. 32091/- and the balance will have to be shouldered by the insured/owner of the vehicle is fit to be struck down as invalid as the High Court had failed to examine the nature and clauses of the policy which was not produced even before the TribunalIn the instant matter, we have noted that the High Court although had granted liberty to the insurance company to realise the amount from the owner of the vehicle, it failed to record expressly that the respondent insurance company shall pay the amount to the appellant/claimant determined by the Motor Accident Claims Tribunal although impliedly the High Court has not denied the amount to the claimant/appellant. But in absence of a categorical direction to the respondent/insurance company to pay the entire amount to the appellant as determined by the Motor Accident Claims Tribunal, the appellant is bound to confront impediments in realizing the amount. Hence, the direction of the High Court is clarified to the extent by recording that the respondent/insurance company shall pay the balance amount also beyond Rs.32,091/- along with interest to the Claimant expeditiously but not later than a period of six weeks from the date of receipt of this order27. We are , thus, pleased to hold that the judgment and order of the High Court which impliedly held that the employee/claimant is entitled to compensation only under the Workmens Compensation Act and not under the Motor Vehicles Act stands set aside and the liberty granted to the Respondent/Insurance Company to realise the amount from the owner without a corresponding direction to the Respondent/Insurance company to pay the amount to the Claimant/Appellant making the appellant liable to realise it from the owner of the vehicle stands modified as indicated hereinbefore.