High Court of KeralaSingle Judge2024-03-26Appeal dismissed

United India Insurance Company Limited v. Shivaprasad N. and Abdul Irshad.K

Case / Petition Number:MACA No. 632 of 2022

Case Details & Bench

Court: High Court of Kerala
Hon'ble Judges: Mary Joseph
Judgment Date: 2024-03-26
Court Decision / Holding: Appeal dismissed; the insurer is held liable to indemnify the insured; the recovery rights against the owner/driver are denied due to the insurer’s failure to plead the licence issue in the written statement and the court’s finding that remand is unwarranted.
Final Disposition: Appeal dismissed

Parties to the Case

Appellants / Petitioners

United India Insurance Company Limited

Respondents

Shivaprasad N.
Abdul Irshad.K.

Legal Representation & Advocates

Counsels for Petitioners

• Adv. Preethi R. Nair

Counsels for Respondents

• Adv. Jiji S

Case Synopsis & Summary

This MACA, originating from an award of the Motor Accidents Claims Tribunal, Kasaragod dated 14 September 2021 in OP(MV) 612/2019, challenges the insurer’s liability to indemnify the award for a fatal motor accident involving motorcycle KL-14Q-7266. The Tribunal held the rider rash and negligent, directing the appellant insurer to satisfy the award. The insurer contends that liability to indemnify should be restricted because the 1st respondent allegedly did not hold a valid driving licence at the time, constituting a breach of policy conditions, and that recovery rights should lie against the 2nd respondent, the owner/insured, after indemnification. Counsel for the appellant relies on Ext. A2 (investigating officer’s final report) and older apex court dicta in National Insurance Co. Ltd. v. Swaran Singh and Pappu and Others v. Vinodkumar Lamba to justify a right to recover. The 1st respondent was ex parte in the original petition; the 2nd respondent did not file a written statement; the 3rd respondent’s written statement did not plead non-possession of a licence. The insurer’s failure to raise this issue in the written statement, and the tribunal’s lack of directed enquiry, are highlighted. The High Court ultimately dismisses the appeal, upholding the insurer’s liability to indemnify and denying recovery, while refusing remand.

Provisions of Law Cited

Section 3(1) read with Section 181 of the Motor Vehicles Act, 1988

Submissions & Arguments

Contentions of Appellants / Petitioners

The appellant insurer argues that Ext. A2 shows contumacious conduct by the owner/driver and a violation of policy conditions. It contends that recovery rights against the owner/insured should follow after indemnification, once the driver’s lack of a valid licence at the time of the accident is established. The insurer asserts that it was entitled to rely on the decisions in Swaran Singh and Pappu to recover the amount after deposit. It submits that the lack of a pleaded licence defence in the written statement cannot bar recovery, and that an interlocutory application should have been filed to compel production of the licence. It seeks a remand to allow production of licence evidence and, if no licence is produced, to permit recovery; it argues that remand should not be granted as of right and that the lacuna was caused by its own delay. Finally, it maintains that the Tribunal should have directed enquiry into the licensing issue before exonerating the insurer from liability.

Contentions of Respondents

The respondents contend that the original petition proceeded with service and the 1st respondent was ex parte, while the 2nd respondent did not file a response. The 3rd respondent’s written statement did not raise the defence that the 1st respondent lacked a valid licence. They argue that the insurer cannot be freed from liability merely because the licence issue was not pleaded in the written statement, and that liability to indemnify the insured should stand as the Tribunal found, given the driver’s negligence. They emphasize that the lack of a pleaded licence defence could not be a basis to disturb the award without proper evidence, and that the insurer’s failure to pursue the remedy at the trial stage should not dictate the outcome. They urge upholding the Tribunal’s findings and rejecting recovery rights against the owner/driver absent clear evidence of non-licence.

Cited Precedents (3)

Case Name	Citation	Treatment	Explanation
National Insurance Co. Ltd. v. Swaran Singh and Others	2004 ACJ 1	Overruled	Apex Court later held that the Tribunal ought to have conducted an enquiry into the licensing aspect prior to exonerating the insurer, thereby reducing the weight of Swaran Singh in this context.
Pappu and Others v. Vinodkumar Lamba and Another	2018 ACJ 690	Overruled	Similar to Swaran Singh, later apex court guidance requires enquiry into licensing before exonerating the insurer, diminishing the earlier authority of Pappu in this scenario.
National Insurance Co. Ltd. v. Ammini Amma	2013(4) KLT 676	Mentioned Only	Cited as an earlier dictum regarding reliance on chargesheets to infer contumacious conduct, but subsequent apex court decisions have altered this approach.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **`IN THE HIGH COURT OF KERALA AT ERNAKULAM`** ## **`PRESENT`** ## **`THE HONOURABLE MRS. JUSTICE MARY JOSEPH`** ``` TUESDAY, THE 26[TH] DAY OF MARCH 2024 / 6TH CHAITHRA, 1946 ``` ``` MACA NO. 632 OF 2022 ``` ``` AGAINST THE AWARD DATED 14.09.2021 IN OPMV NO.612 OF 2019 OF MOTOR ACCIDENT CLAIMS TRIBUNAL, KASARAGOD ``` ## **`APPELLANT/3rd RESPONDENT:`** ``` UNITED INDIA INSURANCE COMPANY LIMITED, TIGER HILLS, MUNICIPAL OFFICE ROAD, KASARAGOD NOW REPRESENTED BY ITS MANAGER, REGIONAL OFFICE, SHARANYA, HOSPITAL ROAD, KOCHI 682 011. ``` ``` BY ADV PREETHY R. NAIR ``` ## **`RESPONDENTS/RESPONDENTS 1 & 2:`** - **`1 SHIVAPRASAD N. AGED 35 YEARS`** - **`S/O. SHESHAPPA, RESIDING AT SRI MATHRU NILAYA, NARAYANA MANGALAM, KOIPADY VILLAGE, MANJESHWAR TALUK, KASARAGOD 671 321.`** - **`2 ABDUL IRSHAD.K.,`** - **`S/O. MOHAMMED, RESIDING AT KUNTANGARADKA, NEAR LAKSHAMVEEDU, KUMBLA P.O., KOIPADY, VILLAGE, MANJESHWAR TALUK, KASARAGOD 671 321.`** ``` BY ADV JIJI S ``` ``` THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 14.02.2024, THE COURT ON ON 26.03.2024 DELIVERED THE FOLLOWING: ``` MACA No.632 of 2022 -:2:- ## **MARY JOSEPH, J.** - - - - - - - - - - - - - - - - - - - - - - - M.A.C.A. No. 632 of 2022 - - - - - - - - - - - - - - - - - - - - - - - - - - - - Dated this the 26[th] day of March, 2024 ## **JUDGMENT** The appeal on hand is originated from an award passed by Motor Accidents Claims Tribunal, Kasaragod, on 14.09.2021 in O.P(M.V) No.612/2019. Appellant is the insurer of a motorcycle bearing Registration No.KL-14Q-7266 which hit one Mr.Gopalakrishna Gatty and caused fatal injuries to him, on account of which he succumbed to death. 2. The Tribunal found the rider of the motorcycle referred to above, rash and negligent and the appellant was directed to satisfy the award. Main challenge raised in the appeal was against the liability fixed on the appellant to indemnify the 2[nd] respondent, for the reason that the 1[st] respondent was established from the evidence adduced, as not holding a valid driving licence to ride the motorcycle at the relevant time of the motor accident. It being violation of a condition of the policy, the MACA No.632 of 2022 -:3:- appellant ought to have been granted the right to recover the compensation from 1[st] and 2[nd] respondents after paying the same in favour of the petitioners. 3. According to Smt.Preethi R. Nair, the learned counsel for the appellant, the Tribunal ought to have relied on Ext.A2, the final report laid by the investigating officer in the crime registered with reference to the motor accident, chargesheeting the 1[st] respondent for an offence under Section 3(1) read with Section 181 of the Motor Vehicles Act, 1988 (for short, 'the M.V Act'). According to her, the Tribunal ought to have granted recovery rights in favour of the appellant, on the basis of the dictums of the Apex Court in **National Insurance Company Ltd. Vs. Swaran Singh and Others** [2004 ACJ 1] and **Pappu and Others Vs. Vinodkumar Lamba and Another** [2018 ACJ 690]. Thus she sought to set aside the award to the extent the appellant was fastened with liability to indemnify the insured and to grant the right to recover the compensation from the 2[nd] respondent, the registered owner/insured of the motorcycle, after it being deposited in favour of the petitioners. MACA No.632 of 2022 -:4:- 4. In the impugned award, 1[st] respondent was set exparte for his failure to turn up to contest the Original Petition despite service of notice on him. Though entered appearance following the service of notice, the 2[nd] respondent did not file any written statement. 3[rd] respondent in it's written statement had taken so many contentions, but, those do not incorporate one to indicate that the 1[st] respondent at the relevant time of the motor accident was not holding a valid driving licence. 5. Chargesheet is marked in evidence by the petitioners as Ext.A2. True that the 1[st] respondent was chargesheeted for an offence under Section 3(1) read with Section 185 of the M.V. Act. But in the written statement filed by the 3[rd] respondent in the Original Petition, it failed to take a contention that the 1[st] respondent was not holding a driving licence as on date of the motor accident. Such a contention is material to be taken by the 3[rd] respondent and then alone evidence could be adduced to establish the same. In the case on hand, such a contention was not taken by the 3[rd] respondent in the written statement filed, but they only took it as a ground in the appeal memorandum. MACA No.632 of 2022 -:5:- 6. The contention if not taken in the written statement filed by the 3[rd] respondent, the opportunity sought to produce the driving licence claimed to be possessed by the 1[st] respondent at the relevant time of the motor accident is not liable to be granted. 7. For that reason, the insurer who has taken a contention regarding violation of policy conditions has to file an interlocutory application seeking for a direction to the driver as well as the owner of the offending vehicle to produce the driving licence if any, the former was holding at the relevant time of the motor accident. If such a direction is issued against the driver and the owner of the offending vehicle, steps have to be taken by the insurer for issuing notice to each of them for production of the same and on their failure to turn up and produce the driving licence, it is open to the Tribunal to draw adverse inference that the driver at the relevant time when the motor accident took place was not holding a valid driving licence to drive the same. If the driving licence is produced by either or both in response to MACA No.632 of 2022 -:6:- the notice issued, the Tribunal can abstain from fixing liability on them. 8. Only when measures are taken by the insurer in the above manner, the Tribunal can exempt it from liability to indemnify the insured of the vehicle and to grant right of recovery of the compensation from them after depositing the same in favour of the petitioners. 9. In the case on hand, the insurer having been failed to take a contention regarding non-possession of driving licence by the 1[st] respondent who was riding the motorcycle at the relevant time, the benefit of right of recovery sought by it in the appeal is only liable to be declined. 10. The learned counsel has also made a prayer to remand the Original Petition to the Tribunal for getting the written statement filed by the insurer to be amended by incorporating the contention regarding non-holding of a driving licence. In view of the position of law settled that remand cannot be granted as of right to fill up the lacuna in evidence that had crept into while conducting it at the primary stage remand sought is only to MACA No.632 of 2022 -:7:- be declined. Contention sought to be taken afresh after remand, being a material one is liable to reverse the finding of the Tribunal itself, appellant does not deserve it. Therefore, the pursuit opted by the appellant/insurer is only to fill up the lacuna occurred due to laches on it’s part while contesting the Original Petition before the Tribunal. Remanding the Original Petition to the Tribunal for the purpose would only be enabling the party to contest it’s case from the primary level and that would result in endless litigations. 11. As per the dictum in **National Insurance Co. Ltd. v. Ammini Amma** [2013(4) KLT 676] cited by the learned counsel for the appellant, a chargesheet can be relied upon to decide the issue as to whether there was contumacious conduct on the part of the owner, in allowing a person who was not holding the authorisation to drive a vehicle. The dictum though was holding the field at a point of time, the Apex Court has held later that the Tribunal ought to have conducted an enquiry into that aspect prior to exonerating the insurer from liability to indemnify the insured. MACA No.632 of 2022 -:8:- 12. In the above circumstances, the failure of the insurer to take a contention in the written statement and to take steps against the owner and the driver of the offending vehicle for production of the driving licence/fitness certificate would enure only to its disadvantage and fastening of liability on it to indemnify the insured. Appeal fails for the reasons and is dismissed. Sd/- **MARY JOSEPH, JUDGE.** ttb