National Insurance Co. Ltd. v. Chellappan and others (MACA No. 1199 of 2015)

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** ## **THE HONOURABLE MR. JUSTICE P.D.RAJAN** ## **TUESDAY, THE 19TH DAY OF SEPTEMBER 2017/28TH BHADRA, 1939** **MACA.NO. 1199 OF 2015 () -------------------------** **AGAINST THE AWARD IN O.P.(M.V.) NO.1125/2006 OF THE MOTOR ACCIDENTS CLAIMS TRIBUNAL, PATHANAMTHITTA DATED 18-06-2014** **-----------------------** ## **APPELLANT(S)/3RD RESPONDENT:** **-----------------------------** **NATIONAL INSURANCE CO.LTD., THIRUVALLA, REP. BY THE MANAGER, KOCHI REGIONAL OFFICE, M.G. ROAD, ERNAKULAM, COCHIN-682035.** **BY ADV. SRI.E.M.JOSEPH** ## **RESPONDENT(S)/CLAIMANT AND RESPONDENTS 1 & 2 :** **--------------------------------------------** **1. CHELLAPPPAN, AGED 60, S/O.KUTTY, KOTTUSSERIL HOUSE, THELOORMALA, VALLAMKULAM WEST, THIRUVALLA-689645.** **2. PHILIP MATHEW @ MANOJ,** **AGED 32, S/O.MATHEW ABRAHAM, PATHIRIVELIL HOUSE, VALLAMKULAM P.O., THIRUVALLA-689645.** **3. JILU GIGI, AGED 39, W/O.GIGI, ELAKOTTOOR THEKETHIL, OTHERA WEST, THIRUVALLA-689645.** **R1 BY ADVS. SRI.T.P.PRADEEP** **R2 BY ADV. SRI.S.SHARAN R3 BY ADV. SRI.M.R.SASITH** **THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 19-09-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **NS** ## **P.D. RAJAN, J. -----------------------M.A.C.A. No.1199 of 2015 ---------------------------------Dated this the 19[th] day of September, 2017** ## **J U D G M E N T** This appeal is preferred against the award in O.P.(M.V.) No.1125 of 2006 of the Motor Accidents Claims Tribunal, Pathanamthitta by the insurer. One Chellappan sustained injuries in a motor accident on 06.05.2006 at 8.45 a.m., while he was travelling in a tempo van No.KL-03/H-4019. The learned Tribunal awarded a sum of Rs.57,870/- (Rupees fifty seven thousand eight hundred and seventy only) with 9% interest per annum from the date of petition till realisation with proportionate cost and directed the appellant to satisfy the award. Being aggrieved by that, the insurer preferred this appeal. 2. The 1[st] respondent's (injured) case in the trial court was that on 06.05.2006 at 8.45 a.m., while he was travelling in a tempo van bearing registration No.KL-03/H-4019 through the Nannur-Vallamkulam road, the driver of the vehicle driven the vehicle in a rash M.A.C.A. No.1199 of 2015 2 and negligent manner and when it reached at the place of occurrence, the vehicle went out of the road and capsized. As a result, he sustained serious injuries. Immediately he was removed to hospital. The driver and owner of the vehicle were set ex- parte in the trial court. The appellant/insurer admitted the insurance of the vehicle but contended that the injured was a gratuitous passenger in a goods vehicle. The injured did not adduce any oral evidence but his documents were marked as Exts.A1 to A18. The insurer examined RW1 and marked Exts.B1, copy of the policy, as his documentary evidence. 3. The learned counsel appearing for the appellant contended that the appellant already satisfied the award and he is entitled to reimburse the award amount on the basis of Ext.B1 policy. The legal liability of non-fare paying passenger who are not employees of the insured is specifically mentioned as per IMT-37A of Ext.B1 Policy. The 1[st] respondent/injured is not a passenger as covered under IMT-37A of Ext.B1 policy. Therefore, it is submitted that the insurance company has ## M.A.C.A. No.1199 of 2015 3 every right to reimburse the amount from the owner of the vehicle. 4. Sec.147 of the Motor Vehicles Act, 1988 reads as follows: “147. **Requirements of policies and limits of liability.** - (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which- (a) is issued by a person who is an authorised insurer; and (b) insures the person or classes of persons specified in the policy to the extent specified in subsection (2)- (i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place; (ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place: provided that a policy shall not be required- (i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen's Compensation Act, ## M.A.C.A. No.1199 of 2015 4 1923 (8 of 1923) in respect of the death of, or bodily injury to, any such employee,- (a) engaged in driving the vehicle or (b) if it is a public service vehicle engaged as a conductor of the vehicle or in examining tickets on the vehicle, or (c) if it is a goods carriage, being carried in the vehicle or (ii) to cover any contractual liability. Explanation.- For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place. (2) Subject to the proviso to sub-section (1), a policy of insurance referred to in sub-section (1), shall cover any liability incurred in respect of any accident, up to the following limits, namely:- (a) save as provided in clause (b), the amount of liability incurred; (b) in respect of damage to any property of a third party, a limit of rupees six thousand: Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier. ## M.A.C.A. No.1199 of 2015 5 (3) A policy shall be of no effect for the purposes of this Chapter unless and until there is issued by the insurer in favour of the person by whom the policy is effected a certificate of insurance in the prescribed form and containing the prescribed particulars of any condition subject to which the policy is issued and of any other prescribed matters; and different forms, particulars and matters may be prescribed in different cases. (4) Where a cover note issued by the insurer under the provisions of this Chapter or the rules made thereunder is not followed by a policy of insurance within the prescribed time, the insurer shall, within seven days of the expiry of the period of the validity of the cover note, notify the fact to the registering authority in whose records the vehicle to which the cover note relates has been registered or to such other authority as the State Government may prescribe. (5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons.” 5. When there is a contractual liability between the insurer and insured, the contracting parties are bound by the contract since the contract is an agreement entered into between the parties. It is true that Ext.B1 is a comprehensive policy issued by the appellant. It shows ## M.A.C.A. No.1199 of 2015 6 that the appellant collected basic 3[rd] party premium and premium for workmen compensation to two employees, employees others one and for non fare paying passenger. As per Ext.B1, the appellant had collected additional premium. 6. Apex Court in **Bhagyalakshmi and others** v. **United Insurance Co. Ltd and another** **[MANU/SC/0939/2009 : (2009) 7 SCC 148]** the question that considered was that whether or not a comprehensive policy would cover the risk of a passenger travelling in a private car. Legal heirs of one Lingappa who succumbed to the injuries sustained by him while he was travelling in a private car owned by one Narayanajoshy had claimed compensation under Sec.166 of the Act. The Tribunal held that the Insurance Company would be liable to indemnify owner of the vehicle. But the above decision was reversed by the High Court. Thus the matter was considered by the Supreme Court and held that on the ground of clarification by the Insurance Regulatory Authority in a package policy the passenger in ## M.A.C.A. No.1199 of 2015 7 a private car or a pillion rider on a two wheeler would be covered in a package/comprehensive policy. 7. Another decision in **Amrit Lal Sood** v. **Kaushalya Devi Thapar [MANU/SC/0209/ 1998 :** **(1998) 3 SCC 744]** the Apex Court has observed that under Section 11(1)(a) of the policy the insurer has agreed to indemnify the insured against all sums which the insured shall become legally liable to pay in respect of death of or bodily injury to 'any person'. The expression 'any person' would undoubtedly include an occupant of the car who is gratuitously travelling in the car. If that be the position, when additional premium is collected, there is no illegality in the order passed by the court below. 8. Apex Court had the occasion to consider the liability of the insurance company in case of issuance of a comprehensive policy in **United India Insurance Company** v. **Rukiya 2006 (4) KLT 192** . This Court in **Oriental Insurance Company Ltd.** v. **K.T. Devassya & Another 2012 ACJ 1148** held that the insurance M.A.C.A. No.1199 of 2015 8 company is liable to pay compensation for carrying excess passengers in a jeep when contractual liability as per the comprehensive policy arises. There is no merit in this appeal and it is dismissed accordingly. NS Sd/- **P.D. RAJAN, JUDGE** / True Copy / P.A. To Judge