Case Note & Summary
The appeals arose from a motor vehicle accident on 30.06.2009 where a husband and wife on a motorcycle were hit by a rashly driven Light Goods Vehicle (Lorry). The wife died on the spot and the husband sustained injuries. The husband filed claim petition MVC No.5018/2009 for his injuries, and along with his two minor children filed MVC No.5019/2009 for the death of his wife. The Motor Accident Claims Tribunal, Bangalore, by common judgment dated 02.09.2010, partly allowed the claims, awarding Rs.3,48,000/- in the injury case and Rs.6,21,000/- in the death case, with interest at 6% per annum. However, the Tribunal absolved the insurer, New India Assurance Company Ltd., and fixed the liability on the vehicle owner, K. Vadivel, on the ground that the driver did not possess a valid driving licence for a transport vehicle. Aggrieved, the claimants filed two appeals under Section 173(1) of the Motor Vehicles Act, 1988 seeking enhancement of compensation and fastening of liability on the insurer. The appellants contended that the insurer failed to discharge its burden of proving that the driver lacked a valid licence. Despite raising a written statement plea, the insurer did not examine any official from the Regional Transport Office; its own officer RW-1 was not competent to testify about the driving licence's validity. The insurer merely produced a driving licence extract marked as Ex.R-2, which constituted secondary evidence inadmissible under Section 65 of the Evidence Act without primary evidence being tendered. Furthermore, the charge sheet did not mention any absence of a valid licence. Relying on settled principles, the appellants argued that as third-party victims, they were not to be penalised for alleged technical breaches, and that under Sections 147(4) and (5) and Section 149(4) of the Motor Vehicles Act, the insurer is statutorily bound to satisfy the award and may recover the amount from the owner - the 'pay and recover' principle. The appellants also challenged the quantum of compensation as abysmally low, asserting that the Tribunal failed to appreciate the evidence regarding the deceased wife's occupation as a tailor earning Rs.10,000/- per month and the medical evidence detailing the injured husband's treatment at HOSMAT Hospital for six months.
Issue of Consideration
Whether the Tribunal erred in absolving the insurer and fastening liability on the owner of the offending vehicle on the ground that the driver lacked a valid and effective driving licence for a transport vehicle; whether the compensation awarded in both claim petitions was inadequate.
Law Points
- principle of pay and recover
- insurer's statutory liability to third parties under MV Act
- burden of proof on insurer to prove breach
- necessity of examining RTO officer for driving licence validity
- prohibition on secondary evidence under Section 65 Evidence Act
- inadequate compensation due to non-consideration of evidence
Case Details
2013 LawText (KAR) (12) 6
M.F.A.NO.3157/2011 C/W M.F.A.NO.3158/2011 (MV)
Smt. Kalpana P.V., Sri. S.P. Shankar (Amicus Curiae), Sri. R. Rajagopalan, Sri. Gopalakrishna
K. Vadivel and The New India Assurance Company Ltd.
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Nature of Litigation
Motor accident claim appeals under Section 173(1) of Motor Vehicles Act, 1988 challenging the Tribunal's judgment and award.
Remedy Sought
Enhancement of compensation and fastening of liability on the insurer instead of the vehicle owner.
Filing Reason
Tribunal awarded compensation but absolved insurer on ground that driver lacked valid driving licence for a transport vehicle, fixing liability on owner, and compensation was inadequate.
Previous Decisions
II Additional Judge, Court of Small Causes, MACT, Bangalore, partly allowed MVC No.5018/2009 and MVC No.5019/2009 on 02.09.2010, awarding Rs.3,48,000/- and Rs.6,21,000/- respectively with 6% interest p.a., and held owner liable, absolving insurer.
Issues
Whether the Tribunal erred in absolving the insurer and fastening liability on the owner on the ground of driver's lack of valid driving licence.
Whether the compensation awarded was just and reasonable, or inadequate.
Submissions/Arguments
Insurer, despite taking a plea of lack of valid driving licence, failed to examine RTO official and relied only on secondary evidence Ex.R-2 which is inadmissible under Section 65 of Evidence Act.
RW-1, an official of insurer, was not competent to prove the nature and validity of the driving licence.
Charge sheet did not mention any lack of valid licence; insurer cannot use it to avoid liability.
Under Sections 147(4) and (5) of MV Act, insurer is statutorily liable to indemnify third-party claims.
Even if breach is proved, insurer must pay compensation to third parties and thereafter recover from owner under 'pay and recover' principle as per Section 149(4) and Supreme Court decisions.
Tribunal failed to properly assess income of deceased tailor and injury treatment duration, resulting in grossly inadequate compensation.
Judgment Excerpts
insurer though had raised a plea in the written statement that driver of the alleged vehicle did not possess a valid driving licence, insurer did not examine the Regional Transport Officer or the Officer from jurisdictional Regional Transport Authority to prove the said plea.
there being a policy issued to the offending vehicle and same being in vogue as on the date of accident insurer has to indemnify the claim of third parties like that of the claimants in the instant appeals, and thereafter recover the same from the owner of the offending vehicle by applying the principle of “Pay and Recover”.
claimants should not be made to suffer on account of technical lapses if any.
Procedural History
Claim petitions MVC No.5018/2009 and MVC No.5019/2009 filed before II Additional Judge, Court of Small Causes, MACT, Bangalore, after accident on 30.06.2009. Tribunal passed common award on 02.09.2010, partly allowing claims and absolving insurer. Appeals filed under Section 173(1) of MV Act before High Court. Notice to owner by substituted service (paper publication) held sufficient. Appeals heard and reserved for judgment, pronounced on 20.12.2013.
Acts & Sections
- Motor Vehicles Act, 1988: Section 173(1), Section 147(4), Section 147(5), Section 149(4)
- Indian Evidence Act, 1872: Section 65
