Case Note & Summary
The appeal was filed by the Insurance Company, HDFC Ergo General Insurance Co. Ltd., challenging the order dated 8.7.2014 passed by the Motor Accident Claims Tribunal, Chandrapur, in M.A.C.P. No.149 of 2011. The Tribunal had allowed an application under Section 140 of the Motor Vehicles Act, 1988, directing the non-applicants (including the appellant) jointly and severally to pay interim compensation of Rs.50,000 with interest at 9% per annum from 15.9.2012 till realization. The claimants were the widow and minor children of Shahajirao Bhonduji Bhoyar, who died in a motor vehicle accident on 6.3.2011 when he was hit by a motorcycle bearing registration No.MH34/T481 while riding a bicycle. The motorcycle was owned by respondent no.5 and driven by respondent no.6. The Insurance Company contended that the driver did not possess a valid driving license at the time of the accident, and therefore, the insurer was not liable to pay compensation. The court, however, held that Section 140 of the Motor Vehicles Act provides for no-fault liability and the insurer is liable to pay interim compensation irrespective of any defence available at the final stage. The court dismissed the appeal, upholding the Tribunal's order and directing the Insurance Company to pay the interim compensation amount.
Headnote
A) Motor Vehicles Act - Interim Compensation - Section 140 - No-Fault Liability - The court considered whether the Insurance Company can avoid interim compensation under Section 140 on the ground of breach of policy conditions such as absence of valid driving license - Held that Section 140 provides for no-fault liability and the insurer is liable to pay interim compensation irrespective of any defence available at final stage - The appeal was dismissed and the order of the Tribunal granting interim compensation of Rs.50,000 with interest was upheld (Paras 4-6).
Issue of Consideration
Whether the Insurance Company can avoid payment of interim compensation under Section 140 of the Motor Vehicles Act, 1988 on the ground that the driver did not possess a valid driving license at the time of the accident.
Final Decision
The appeal was dismissed. The order of the Motor Accident Claims Tribunal, Chandrapur, dated 8.7.2014, granting interim compensation of Rs.50,000 with interest at 9% p.a. from 15.9.2012 till realisation was upheld. The Insurance Company was directed to pay the amount.
Law Points
- Interim compensation under Section 140 of Motor Vehicles Act
- 1988 is a no-fault liability
- Insurance company cannot avoid liability at interim stage on grounds of breach of policy conditions
- Liability of insurer is joint and several with owner and driver
Case Details
2015 LawText (BOM) (08) 125
First Appeal No.777 of 2014
Mr.A.J.Pophaly for the Appellant, Mr.Ashish Kadukar for Respondent No.1, Mr.Rajnish Vyas for Respondent Nos.5 and 6
The Manager, HDFC Ergo General Insurance Co. Ltd.
1.Kalpana wd/o. Shahajirao Bhoyar, 2.Manish Shahajirao Bhoyar, 3.Sonu Shahajirao Bhoyar, 4.Aniket s/o. Shahajirao Bhoyar, 5.Pocham Rajlingu Rahulawar, 6.Mohan Raymalu Mithuwar
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Nature of Litigation
Appeal against order granting interim compensation under Section 140 of Motor Vehicles Act, 1988 in a motor accident claim.
Remedy Sought
The appellant Insurance Company sought to set aside the order of the Motor Accident Claims Tribunal granting interim compensation of Rs.50,000 with interest.
Filing Reason
The Insurance Company contended that the driver of the offending vehicle did not possess a valid driving license at the time of the accident, and therefore, the insurer was not liable to pay compensation.
Previous Decisions
The Motor Accident Claims Tribunal, Chandrapur, by order dated 8.7.2014, allowed the application for interim compensation under Section 140 of the Motor Vehicles Act, 1988, directing the non-applicants (including the appellant) jointly and severally to pay Rs.50,000 with interest at 9% p.a. from 15.9.2012 till realisation.
Issues
Whether the Insurance Company can avoid payment of interim compensation under Section 140 of the Motor Vehicles Act, 1988 on the ground that the driver did not possess a valid driving license at the time of the accident.
Submissions/Arguments
The appellant Insurance Company argued that the driver of the offending vehicle did not have a valid driving license, and therefore, the insurer is not liable to pay compensation.
The respondents (claimants) argued that Section 140 provides for no-fault liability and the insurer is liable to pay interim compensation irrespective of any defence.
Ratio Decidendi
Section 140 of the Motor Vehicles Act, 1988 provides for no-fault liability, and the insurer is liable to pay interim compensation irrespective of any defence available at the final stage, such as breach of policy conditions regarding driving license.
Judgment Excerpts
This appeal by the Insurance Company questions legality and validity of the impugned order below Exh.2 in M.A.C.P. No.149 of 2011 whereby the learned Chairman, Motor Accident Claims Tribunal, Chandrapur by order dt.8.7.2014 allowed the application for interim compensation under Section 140 of the Motor Vehicles Act, 1988 directing non applicant nos. 1 to 3 jointly and severally to pay a sum of Rs.50,000/ with interest @ 9 % p.a. from 15.9.2012 till realisation of the amount.
Procedural History
The Motor Accident Claims Tribunal, Chandrapur, allowed the application for interim compensation under Section 140 of the Motor Vehicles Act, 1988 on 8.7.2014. The Insurance Company filed an appeal before the High Court of Bombay at Nagpur Bench, which was heard and dismissed on 20.8.2015.
Acts & Sections
- Motor Vehicles Act, 1988: Section 140
