Case Note & Summary
The present appeal was filed by Reliance General Insurance Co. Ltd. under Section 173(1) of the Motor Vehicles Act, 1988, challenging the judgment and award dated 27.04.2015 passed by the I Addl. Senior Civil Judge & MACT-V, Davanagere, in MVC No.364/2010. The Tribunal had awarded compensation of Rs.6,40,000/- with interest at 6% per annum to the claimants, who are the legal representatives of the deceased Dadapeer, who died in a motor vehicle accident. The appellant-Insurance Company contended that the vehicle was being used in violation of permit conditions and therefore they were not liable to pay compensation. The respondents-claimants argued that the insurer is liable to pay compensation to third parties and can recover from the insured if there is a breach. The court, after hearing the parties, held that the Insurance Company is liable to pay compensation to third parties and can recover the same from the insured in accordance with law. The appeal was dismissed, and the judgment and award of the Tribunal were confirmed. The court directed the Insurance Company to deposit the compensation amount with accrued interest within four weeks, with liberty to recover from the insured.
Headnote
A) Motor Vehicles Act - Third Party Liability - Breach of Policy Conditions - The insurer is liable to pay compensation to third parties even if there is a breach of policy conditions, with a right to recover from the insured - The Tribunal awarded compensation of Rs.6,40,000/- with interest at 6% p.a. - The appeal challenging liability was dismissed (Paras 1-5).
Issue of Consideration
Whether the Insurance Company can avoid liability to third parties on the ground that the vehicle was used in violation of permit conditions, and whether the Tribunal was justified in awarding compensation of Rs.6,40,000/- with interest at 6% per annum.
Final Decision
The appeal is dismissed. The judgment and award dated 27.04.2015 in MVC No.364/2010 passed by I Addl. Senior Civil Judge & MACT-V, Davanagere, is confirmed. The Insurance Company is directed to deposit the compensation amount with accrued interest within four weeks from the date of receipt of a copy of this judgment, and is at liberty to recover the same from the insured in accordance with law.
Law Points
- Motor Accident Claims
- Third Party Liability
- Breach of Policy Conditions
- Pay and Recovery
- Section 173(1) Motor Vehicles Act
- 1988
