Case Note & Summary
The High Court of Judicature at Bombay, Bench at Aurangabad, dealt with an appeal filed by M/s Shriram General Insurance Company Limited against an award of Rs.40,17,602/- passed by the Motor Accident Claims Tribunal, Majalgaon, in favour of the dependants of deceased Rajendra Nakhate. The accident occurred on 23.2.2014 when the deceased was travelling on his motorcycle and was hit by an offending truck. The Tribunal held the truck driver rash and negligent and saddled liability on the owner and insurer. The insurer appealed, challenging the involvement of the offending vehicle, the quantum of compensation, and alleging contributory negligence of the deceased. However, the claimants raised a preliminary objection that the appeal was not maintainable because the insurer had not obtained permission from the Tribunal under Section 170(b) of the Motor Vehicles Act, 1988, which allows an insurer to contest the claim on all grounds available to the insured. The insurer had applied for such permission but the application was never allowed. The Court examined the legal position by referring to several Supreme Court judgments. It noted that in United India Insurance Co. Ltd. v. Shila Datta, a three-judge bench had held that once an insurer is impleaded as a party respondent, it can raise all contentions without being restricted to the statutory defences under Section 149(2). However, the same judgment referred the question of maintainability of an appeal by the insurer alone to a larger bench. The earlier three-judge bench decision in National Insurance Co. Ltd. v. Nicolletta Rohtagi, which mandated that an insurer must obtain permission under Section 170(b) to contest on merits, continued to hold the field. Relying on Josphine James v. United India Insurance Co. Ltd., where the Supreme Court reaffirmed that in the absence of such permission, an insurer cannot file an appeal questioning the quantum of compensation, the High Court held that the present appeal was not maintainable. The Court thus concluded that the insurance company alone is not entitled to file an appeal questioning the quantum of compensation without the requisite permission, and the appeal was accordingly not entertained on those grounds. The judgment did not proceed to decide the factual contentions regarding the accident or the computation of compensation.
Headnote
A) Motor Vehicles - Appeal by Insurer - Permission under Section 170(b) - Motor Vehicles Act, 1988, Sections 170(b), 173 - The insurance company filed an appeal challenging the quantum of compensation and involvement of the offending vehicle. It had applied for permission under Section 170 before the Tribunal, but the application was not expressly allowed. Held, since permission was not granted, the insurer alone is not entitled to file appeal questioning quantum of compensation; the appeal is not maintainable. (Paras 8, 12) B) Precedent - Supreme Court Decisions - Binding Effect of Nicolletta Rohtagi - Motor Vehicles Act, 1988, Section 170(b) - The Court examined the decision in United India Insurance Co. Ltd. v. Shila Datta, where a three-judge bench held that an insurer impleaded as a party respondent can raise all contentions. However, that judgment also referred the question of maintainability of an appeal by the insurer alone to a larger bench. The earlier three-judge bench decision in National Insurance Co. Ltd. v. Nicolletta Rohtagi, which held that an insurer cannot contest on merits without Section 170(b) permission, remains binding. Following Josphine James v. United India Insurance Co. Ltd., the High Court held that the insurer's appeal questioning quantum is not maintainable. (Paras 9-12)
Issue of Consideration
Whether the appeal filed by the insurance company alone, challenging the quantum of compensation and the involvement of the offending vehicle, is maintainable in the absence of permission from the Tribunal under Section 170(b) of the Motor Vehicles Act, 1988?
Final Decision
Held that the insurance company alone is not entitled to file appeal questioning the quantum of compensation in the absence of permission from the Tribunal under Section 170(b) of the Motor Vehicles Act. Accordingly, the appeal was not maintainable and dismissed on that ground.
Law Points
- Insurer cannot file appeal questioning quantum of compensation without permission under Section 170(b) of MV Act
- Insurer impleaded as party respondent can raise all contentions
- Section 149(2) does not restrict insurer's defences if a party
- Appeal by insurer alone maintainable only if permission obtained under Section 170(b)
- Nicolletta Rohtagi holds the field regarding insurer's right to appeal
