Case Note & Summary
The appeal arises from a judgment of the Motor Accident Claims Tribunal, Pune, which exonerated the Insurance Company from liability to pay compensation to the claimants, the legal heirs of the deceased Satish Vairat. The deceased died in a motor vehicle accident on 22.11.2015 when the Ertiga car bearing No. MH-42-K-7730, owned by Tanaji Nanaware, turtled near Khambatki tunnel on Bangalore-Pune Highway. The car was being driven by Rohit Gaikwad in a rash and negligent manner. The deceased and the owner Tanaji Nanaware died on the spot. The claimants filed a claim petition before the Tribunal. The Insurance Company contended that the vehicle was used on hire and reward basis, in breach of the insurance policy terms. In support, the Insurance Company examined its officer and a police officer who had recorded the statement of the owner's wife, Sangita Nanaware, wherein she allegedly stated that the vehicle was taken on hire. However, Sangita Nanaware was not examined as a witness before the Tribunal. The Tribunal accepted the police statement and exonerated the Insurance Company. The claimants appealed. The High Court held that the burden to prove breach of policy conditions lies on the insurer. The police statement, not being tested in cross-examination, could not be relied upon as substantive evidence. No other evidence was produced to show that the vehicle was used on hire. Therefore, the Tribunal's finding was erroneous. The High Court allowed the appeal, set aside the Tribunal's order exonerating the Insurance Company, and directed the Insurance Company to pay the compensation amount to the claimants with interest at 7.5% per annum from the date of the claim petition.
Headnote
A) Motor Accident Claims - Insurance - Exoneration of Insurer - Breach of Policy Terms - The insurer must prove breach of policy conditions by leading cogent evidence; a police statement not tested in cross-examination cannot be the sole basis for exoneration - The Tribunal erred in relying on the statement of the owner's wife recorded by police without examining her as a witness - Held that the appeal is allowed and the Insurance Company is directed to pay compensation (Paras 1-6).
Issue of Consideration
Whether the Motor Accident Claims Tribunal was justified in exonerating the Insurance Company from liability on the ground that the offending vehicle was used on hire and reward basis, based solely on a police statement of the owner's wife who was not examined as a witness.
Final Decision
The appeal is allowed. The impugned judgment and order of the Motor Accident Claims Tribunal, Pune, exonerating the Insurance Company is set aside. The Insurance Company is directed to pay the compensation amount to the claimants with interest at 7.5% per annum from the date of the claim petition.
Law Points
- Burden of proof on insurer to establish breach of policy terms
- Exoneration of insurer requires cogent evidence
- Police statement not tested in cross-examination cannot be sole basis for exoneration
