MV Act -Claimant's Cross Objection For Enhanced Compensation Maintainable In Insurer's Appeal Against Award : SC [Read Judgment]

The Supreme Court has held that claimant in a motor accident compensation case can file cross-objection in an appeal filed by the insurer against the award.

The Court set aside a judgment of the Patna High Court which had held such a cross-objection by claimant to be not maintainable.

The High Court's reasoning was that as the insurer's appeal was only against the rejection of its contentions regarding breach of conditions by the insured, the claimants could not have sought cross-objection. The insurer's appeal in the instant case was only with respect to not absolving it from liability to pay compensation. Unless the insurer challenges the quantum, the claimants cannot file cross-appeal for enhanced compensation, the HC ruled. 

This view was held to be unsustainable by a SC bench comprising CJI SA Bobde, Justices Surya Kant and BR Gavai.

"A conjoint reading of the provisions of Section 173 of the M.V. Act; Rule 249 of the Bihar Motor Vehicle Rules, 1992; and Order XLI rule 22 of the CPC would reveal, that there is no restriction on the right to appeal of any of the parties", observed the SC.

The SC also held that the distinction drawn by the HC regarding appeal against quantum of compensation and appeal against liability to be legally untenable.

"When in an appeal the appellant could have raised any of the grounds against which he is aggrieved, we fail to understand, as to how a respondent can be denied to file cross­objection in an appeal filed by the other side challenging that part of the Award with which he was aggrieved. We find, that the said distinction as sought to be drawn by the High Court is not in tune with conjoint reading of the provisions of Section 173 of the M.V. Act; Rule 249 of the Bihar Motor Vehicle Rules, 1992; and Order XLI rule 22 of the CPC.", the bench added.

The Apex Court also noted that the appeal of the insurer had challenged the entire award. The claimants were also impleaded as respondents in the insurer's appeal, observed the Court.

"In such circumstances, the High Court has erred in declining to consider the cross­objection of the appellants herein (the claimants) on merits", said the Court.

Also, as per Order XLI Rule 22(4) of CPC, the cross-objection can be continued even if the appeal is dismissed for default. This too was taken note of the SC in allowing the appeal.

Setting aside the judgment, the SC directed the HC to deal with the cross-objection on merits. 

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