In Time-Barred Appeal Under MV Act, Award Can’t Be Stayed Without First Deciding Delay Condonation Application: Andhra Pradesh High Court

The Andhra Pradesh High Court has held that in a time barred appeal under Section 173 of the Motor Vehicles Act before the High Court, they stay of execution of the award cannot be granted, so long as the delay condonation matter is not decided finally, in view of 2nd proviso to Section 173 of the MV Act & Order 41 Rule 3A (3) CPC.

"We are of the considered view that in a time barred appeal, so long as the matter for condonation of delay is not considered and decided in favour of the applicant for condonation of delay, the valuable right of the successful litigant/respondent acquired on the basis of the judgment/award under challenge cannot be interfered with or restricted to the execution of the decree only to a limited extent," said the court.

The division bench of Justice Ravi Nath Tilhari and Dr. Justice K. Manmadha Rao passed the order, while dismissing United India Insurance Company Limited's application seeking stay on an award of the Motor Accidents Claims Tribunal, East Godavari, during the pendency of an appeal.

"By grant of any such interim order, at this stage, as submitted by the appellant's counsel, would be to put restriction on the right of the claimants to get execution of the award before the Tribunal. The claimants have acquired a right to treat the award as having attained finality, on expiry of the limitation period for appeal, which cannot be interfered with by confining the same to 50% of the awarded amount, pending consideration of the delay condonation matter," said the court.

The bench said that the Supreme Court in Sharanamma v. North East Karnataka RTC has held that when an appeal is filed under Section 173 of the MV Act before the High Court, the normal rules which apply to appeals before the High Court are applicable to such an appeal also.

"In view of the aforesaid, we are of the considered view that to the appeal under Section 173 of the MV Act to the High Court, in the absence of a different procedure having been provided, either under the MV Act or the APMV Rules 1989, and the applicability of Order 41 CPC also not having been excluded, in view of the judgment of the Hon'ble the Apex Court, the normal rules which apply to appeals before High Court, are applicable," said the court.

The court said as per the mandate under Order 41 Rule 3A CPC, in a time barred appeal unless the application for condonation of delay is allowed and the Court after hearing under Rule 11 does not dismiss the appeal but decides to hear it, stay of execution of decree cannot be granted.

Advocate Naresh Byrapaneni, representing the insurance company, earlier contented that Rule 473 of the Andhra Pradesh Motor Vehicles Rules, 1989, stipulates that only certain provisions of the CPC apply to proceedings before claims tribunal and contented that the provision of the CPC, more specifically the Order 41, as not finding place in Rule 473, would not be applicable to an appeal filed under the MV Act.

However, the court clarified that Rule 473 of the APMV Rules governs only those proceedings that are initiated before a Claims Tribunal and not those before the High Court.

"Consequently, the submission of the learned counsel for the appellant, based on Rule 473 of the APMV Rules 1989 that since Order 41 CPC does not find mention in Rule 473, therefore it would not apply to appeals under Section 173 of MV Act, is misconceived," said the bench.

The counsel for the appellant had also placed reliance on New India Assurance Co. Ltd., Visakhapatnam v. Srikakulapu Ayyababu wherein it was held that even a unnumbered stage, the court may exercise the discretion of granting conditional or unconditional stay as the case may be.

The court said the previous judgments of the co-ordinate Benches in Tube Tools and Hardward Mart, Visakhapatnam and Tanuku Veera Venkata Satyanarayana Sarma —wherein it was held held that Order 41 Rule 3A (3) is a mandatory provision, escaped consideration in New India Assurance Co. Ltd., Visakhapatnam.

"Once it was held by a Coordinate Bench that Order 41 Rule 3A (3) is a mandatory provision and is a clear bar for passing an order of stay of execution of a decree before the Court decides to hear the appeal, there does not lay any discretion in the Court, in a time barred appeal, to grant stay of the execution of the award or decree, conditionally or unconditionally. A contrary view that it was discretionary, could not be taken by a later Coordinate Bench and even without making reference to the earlier pronouncements," ruled the bench.

The court said New India Assurance Co. Ltd., Visakhapatnam does not lay down any law and in any event, not the correct law. "The same is over ruled," said the court.

While dismissing United India Insurance Company Limited's application, the court said the appellant is at liberty to file fresh application after the delay condonation matter is decided finally.

Title: M/s. United India Insurance Company Limited vs. Undamatla Varalakshmi and 6 others

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