Only Use Of Motor Vehicle Required To Be Established U/S 163A MVA; Need Not Prove Someone Else Was Driving Negligently: Gujarat High Court

Background

The deceased father of the Appellant-Claimants, while returning home on his tractor, got the vehicle overturned and died consequently. This tractor was in the ownership of Opponent No 1. The income of the deceased, as claimed, by the Appellants was INR 3,200 per month. He also possessed a valid driving license.

The Appellants claimed INR 4,38,836 as compensation from Opponent 1 and 2 (insurance company). Opponent No 1 did not appear before the Tribunal. The Tribunal awarded compensation, inclusive of funeral expenses, to the tune of INR 3,30, 900 with 9% interest per annum. The same was to be recovered from only Opponent No 1 and not the insurance company.

Aggrieved, the First Appeal was preferred by the Appellants.

The primary contentions of the Appellants were that the insurance company had collected premium of INR 100 towards personal accident of owner-cum-driver and collected INR 25 as premium towards legal liability to the drive. Hence, it could not be exonerated from the liability.

To bolster this contention, the Appellant relied on Chandrakanta Tiwari V. New India Assurance Company Ltd. & Anr. [(2020) 7 SCC 386] where the Apex Court had held that the insurance company "cannot run away from its liability to pay the amount of compensation to the claimants."

Another grievance was that the Tribunal had considered the income of the deceased to be INR 2,400 and not INR 3,200 pm.

Per contra, the Opponent No. 2 averred that the deceased was solely negligent and no premium for legal liability to driver was received by the insurance company as under Sections 147 and 179 of the Act. Further, per Ramkhiladi & Anr. Vs. United India Insurance Company & Anr.,[(2020) 2 SCC 550], the insurance company cannot be held liable to pay compensation but at the most, the company can grant INR 1 lakh lump-sum compensation.

Additional arguments were that the deceased was not the third party and could not claim insurance from his own insurance company and the deceased was himself driving the tractor. The deceased was the son of the owner of the driver.

Judgement

Stressing upon the 'just and fair' element of the compensation, the Bench clarified that the MV Act was a beneficial legislation for providing relief to victims and families.

Additionally, the Tribunal noted that copy of the insurance policy placed on the record clearly indicates the amount of the premium of Rs.25/- is paid under Clause of IMT-28 towards legal liability of driver. The same was not controverted by the insurance company.

"Therefore, I found that there is reason to believe that the insurance company has accepted the premium under Clause IMT-28 of Rs.25/- as per the policy available on the record of the Tribunal. The pleadings and proof in motor accidents claims petition should be considered liberally and more particularly when the documentary evidence produced on the record, was not challenged by the other side and has exhibited by the Tribunal," said the Court.

It relied on Valiben Laxmanbhai Thakore (Koli) Wd/o. Late Laxmanbhai Ramsingbhai Thakore (koli) and others Vs. Kandla Dock Labour Board and Anr. [2021 (4) GLH 77] where it was held:

"Thus, when the owner of a vehicle pays additional premium and same is accepted by the Insurance Company, liability of the Insurance Company gets extended under the Motor Vehicles Act. Section 147 of the Act clearly prescribes for statutory liability to cover risk of paid Driver and Conductor under the Insurance Policy, which is a matter of contract. On payment of such additional premium by the owner, the liability of the owner shifts upon the Insurance Company. On payment of such additional premium by the owner, the liability of the owner shifts upon the Insurance Company."

Similarly, in Chandrakanta Tiwari V. New India Assurance Company Ltd. & Anr., the Apex Court had held:

"The High Court, therefore, is clearly wrong in stating that it was necessary under Section 163A to prove that somebody else was driving the vehicle rashly and negligently, as a result of which, the death of the victim would take place."

Owing to these precedents, the High Court did not exonerate the insurance company from liability under Sections 163-A and 147 of the MV Act.

Further, the Bench rejected the contention that the income of the deceased was INR 3,200 pm and accordingly refused to set aside the Tribunal's conclusion that the income was INR 2,400 pm.

Accordingly, the Court allowed the appeal partly and directed the insurance company to grant compensation worth INR 3,30,900 with 9% interest pa.

"insurance company is liable to pay the compensation to the claimants under Section 163-A of the Motor Vehicles Act, 1988 and also in view of Section 147 of the Motor Vehicles Act, 1988, the insurance company is bound to pay the amount of compensation to the claimants. Therefore, on the finding recorded by the Tribunal regarding exonerating the Insurance Company from the liability to pay the compensation is found erroneous and also against the settled position of the law as in the claim petition under Section 163-A of Motor Vehicles Act, 1988, only use of motor vehicle is required to be established and therefore, the finding given in para-7 of the judgment is required to be interfered with by this Court," the order stated.

Case Title: SONALBEN BHANABHAI TADVI-MINOR THROUGH UNCLE & 2 other(s) Versus MADHUBEN BHAGUBHAI TADVI & 1 other(s)

Case No.: C/FA/1129/2013 

Citation: 2022 LiveLaw (Guj) 39