K. Balasubramaniyam and others v. Mohana Krishnan S and M/S New India Assurance Co. Ltd.

MACA No. 204/2016 1 # **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR. JUSTICE SUNIL THOMAS** **FRIDAY, THE 25TH DAY OF OCTOBER 2019 / 3RD KARTHIKA, 1941** **MACA.No.204 OF 2016** **AGAINST THE AWARD IN OPMV 500/2002 DATED 05-05-2015 OF ADDITIONAL DISTRICT COURT & ADDITIONAL MOTOR ACCIDENT CLAIMS TRIBUNAL ,THALASSERY** ## **APPELLANT/PETITIONERS:** **K.BALASUBRAMANIYAM AGED 75 YEARS S/O.KUNHIKANAN, RESIDING AT AKSHAY OPP.S.N.COLLEGE, THOTTADA P.O. KANNUR-7** **2.MRS.C.P.PRASANNA, W/O.K.BALASUBRAMANIYAM, AGED 63 YEARS, RESIDING AT AKSHAY, OPP.S.N.COLLEGE, THOTTADA P.O. KANNUR - 7** **3.MR.SREE SHANKAR, S/O.K.BALASUBRAMANIYAM AGED 43 YEARS RESIDING AT AKSHAY OPP.S.N.COLLEGE, THOTTADA P.O. KANNUR-7** **4.MR.ABHILASH, S/O. K.BALASUBRAMANIYAM AGED 35 YEARS RESIDING AT AKSHAY OPP.S.N.COLLEGE, THOTTADA P.O. KANNUR-7** **BY ADVS. SRI.A.K.SRINIVASAN SRI.A.S.BENOY SRI.JIMMY GEORGE** MACA No. 204/2016 2 ## **RESPONDENT/RESPONDENT:** **1. MOHANA KRISHNAN S, S/0.SASI KUMAR T.C.25/3177, AMBADI, THOPPIL LANE, VANCHIYOOR, TRIVANDRUM - 695035** **2. M/S. NEW INDIA ASSURARNCE CO.LTD., KANNUR - 670001.** **R1 BY ADV. SRI.AJIT G.ANJARLEKAR R1 BY ADV. SRI.GOVIND PADMANAABHAN R1 BY ADV. SRI.PMM.NAJEEB KHAN R1 BY ADV. SRI.RAM MOHAN.G. R1 BY ADV. SRI.G.P.SHINOD** **THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 19-08-2019, THE COURT ON 25/10/2019 DELIVERED THE FOLLOWING:** 3 ## **JUDGMENT** The petitioners in O.P.(MV) No.500/2002 are the appellants herein. 2. The case of the petitioners before the court below was that, on 3/10/2001 at about 7.15 p.m., while the son of the first and the second appellants was traveling along the main road on a motor cycle driven by the first respondent, the motor cycle hit against a pedestrian. The son was thrown off and he sustained serious injuries. On the way to the hospital, he succumbed to the injuries. He was 23 years old. He was a student of MBA, had good academic background and had planned to appear for Civil Services Examination in 2001. He was appointed as the Business Development Manager of a company and appointment letter was also issued. If the accident had not happened, he would have completed MBA and passed the Civil Services Examination. If he had joined the job, he would have obtained salary of Rs.25,000/- per month. Accordingly, appellants, who are the legal heirs of the deceased, claimed Rs.20,00,000/- as compensation. 3. Before the Motor Accident Claims Tribunal, the first respondent remained ex parte. The 2[nd] respondent Insurance Company filed a detailed written statement admitting the insurance of the offending vehicle at the time of the accident. They denied the various claims and inter alia, it was also contended that the deceased was traveling in the motor cycle MACA No. 204/2016 4 as a gratuitous passenger without payment of any fare or reward. Since he was a gratuitous passenger, as per the policy condition, he was not entitled to get any compensation from the insurance company. There was no specific coverage in respect of the risk pertaining to the gratuitous passenger. The policy taken by the first respondent was a statutory policy and not a comprehensive policy. It did not cover the risk of death or bodily injury to any gratuitous passenger. Hence, the insurance company was not liable to pay compensation for a gratuitous passenger covered by an Act policy, in which no premium was paid for a gratuitous passenger. Hence, the second respondent has no liability to pay compensation. On the basis of the above pleadings both sides let in oral and documentary evidence. On an evaluation of the oral testimony of PW1s to PW3 and Exts.A1 to A27, RW1 and Exts.B1 to B5, Exts.X1 to X3 marked as third party exhibits, the court below allowed the petition in part, directing the first respondent to pay compensation of Rs.33,60,000/- with 8% interest per annum from the date of the petition till the date of deposit. 4. Aggrieved by the above, the appellants have preferred this appeal. Heard the learned counsel for the appellants and the learned counsel for the second respondent. 5. Though learned counsel for the appellants assailed the quantum of compensation in general, no such specific ground was taken up and detailed arguments were not advanced on the question of MACA No. 204/2016 5 quantum of compensation. Though the appellants have a case that the amount ordered as compensation was low and that separate compensation was not awarded in favour of the petitioners other than the second petitioner, on an evaluation of the entire facts, I feel that the court below has granted reasonable compensation. 6. The basic contention revolved around the finding of the court below that, the insurance company had no liability to pay compensation to a gratuitous passenger and about the quantum of interest ordered. The contention set up by the learned counsel for the appellants was that, the available materials on record indicated that the vehicle was insured with the second respondent and the premium was paid. It was contended that the finding of the court below that, it was only a third party policy and as such will not apply to a gratuitous passenger, was incorrect. It was also contended that the court below went wrong in holding that, it was only an Act only policy and there was no IMT 70 endorsement. It was contended that the insurance company did not establish that the above contention was applicable to the policy in dispute. It was also contended that since IMT 70 is applicable only for comprehensive policy or B policy, the Tribunal ought to have seen that the pillion riders are automatically covered. It was argued that IMT 70 endorsement was for covering the risk of the pillion rider and it cannot be said that additional premium of Rs.50/- collected was for covering unlimited third party property damage. MACA No. 204/2016 6 7. Another limb of the contention was that even if the Tribunal had arrived at the conclusion that the insurance company was not liable, it ought to have ordered the insurance company to pay and to recover from the first respondent in the light of the settled legal position and also in the light of the valid insurance policy. It was further contended that the amount of interest ordered at the rate of 8% per annum was less . 8. It seems that the Insurance Company relied on Exts.B1 to B5. Ext.B1 is the insurance policy during the relevant time. It was an Act only policy and the additional premium was collected for the third party property damage.The Tribunal has elaborately considered this issue and ultimately concluded that the policy will cover the risk of third party injured in an accident. 9. The argument advanced that even if the Act only policy was taken, it would cover the risk of all persons injured in an accident cannot be accepted. It was held that the word “any person” provided in Section 147(1)of the MV Act does not include a gratuitous passenger as held by the decision in **Oriental Insurance Co.Ltd. v. Sudhakaran (2008 (2) KLT 936)** . It was held that the liability of the Insurance company in a case of this nature did not extend to a pillion rider of motor cycle unless the requisite amount of premium was paid for covering the risk of legal obligation arising from Section 147 of the MV Act. The Tribunal held that if an Act only policy is taken by the owner, it will not cover the risk of pillion rider and if the owner intends to cover the risk of MACA No. 204/2016 7 pillion rider then it is for him to pay additional premium and get the risks of pillion rider covered by the policy because the liability of the insurer to reimburse owner in respect of the claim made by the third party was statutory, whereas other claims were not statutory. 10. Evidently, there was a specific endorsement on the policy that the additional premium was collected for the third party damage only. Having evaluated this and the settled legal position, I find that the contention of the appellants herein that the insurance policy covers the gratuitous passenger is not sustainable. 11. The Tribunal on the basis of the above findings held that the insurance company cannot be called upon to pay the compensation. There was no order to pay and to recover from the first respondent. This seems to be incorrect in the light of the legal position in _**Manuara Khatun and Ors v. Rajesh Kr.Singh and Ors.(AIR 2017 Supreme Court 1204)**_ . In an identical situation, wherein the Supreme Court found that the deceased was a gratuitous passenger not covered under the Insurance policy, insurer was directed to pay amount of compensation to the claimants and to recover it from the insured. The Supreme Court, on this aspect held that the above question was no more res integra. It was held that, it was the subject matter of several decisions including _**National Insurance Co.Ltd. v. Baljit Kaur and Ors(2004) 2 SCC 1 1340)**_ . 12. The same view was followed by the Supreme Court in MACA No. 204/2016 8 ## _**Shivaraj v. Rajendra and Anr.(AIR 2018 Supreme Court 4252).**_ That was a case wherein there was no evidence to show that claimant was traveling as loader in the trailer attached to tractor or any trailer was insured or attached to tractor and that the trailer was insured. On that basis, it was found that the claimant travelled in the tractor as passenger, even though it could accommodate only the driver. The Apex Court held that, insurer was liable to pay compensation amount determined by the Tribunal and granted liberty to recover the same from the owner of the offending vehicle. 13. Having regard to the above legal position, I cannot sustain the award of the MACT to the extent of absolving the second respondent from paying initially the amount agreed. Accordingly, the award will stand modified by directing the second respondent Insurance Company to comply with the direction Nos.(1) to 6 of the award and to recover the amount so paid from the first respondent. 14. The Tribunal has ordered 8% interest to be payable on the award amount. Learned counsel for the appellants invited my attention to the decision in _**Magma General Insurance Co.Ltd. v. Nanu Ram and Ors (2018 (8) SCJ 338),**_ wherein the Supreme Court enhanced the interest payable on the amount awarded by the Tribunal from 8% to 12% from the date of filing the claim petition till payment. The Supreme Court had referred to the Judgment of the Honble Supreme Court in _**National Insurance Co. v. Pranay Sethi (2017) 16 SCC 680)**_ that the MACA No. 204/2016 9 Motor Vehicles Act is a beneficial and welfare legislation and the court was duty bound and entitled to award “just compensation” irrespective of whether any plea in that behalf was raised by the claimant. 14. In the light of the above, amount of interest ordered by the court below will stand modified as 12% from the date of filing the claim till payment instead of 8% ordered by the Tribunal, considering the facts involved in this case. Accordingly, the appeal stand allowed in part. While sustaining the amount awarded to be paid, it is directed that the second respondent shall pay the amount in accordance with the award of the MACT to the 2[nd] petitioner and recover the amount from the first respondent. Interest payable will stand modified as 12% from the date of filing of the claim petition till payment. **Sd/-** **SUNIL THOMAS** **JUDGE** **dpk**