SUPREME COURT OF INDIA
A.N. RAY, C.J.I., M.H. BEG AND P.S. KAILASAM, JJ.
Minu B. Mehta and another, Appellants
Versus
Balkrishna Ramchandra Nayan and another, Respondents.
Civil Appeal No. 1249 of 1976,
D/- 28-1-1977.
Advocates Appeared
Mr. F. S. Nariman, Sr. Advocate (M/s. J. M. Patel and B. R. Agarwala, Advocates with him), for Appellants; M/s R. D. Hattangadi Geogre Kurien and Mrs. Urmila Sirur, Advocates for Respondent No. 1; Mr. K. K. Singhvi, Sr. Advocate (Mr. V. N. Ganpule, Advocate with him), for Applicant Intervener.
Constitution Of India,1950 – Articlce,136 - Motor Vehicles Act, 1939 - Section 110E - Motor Accidents Claims - Payment of compensation - Accidents Claims Tribunal for Greater Bombay is one Bombay and is respondent in this appeal respondent was driving his car towards Fort side on Dr- Annie Besant Road- With him was sitting on left side in front seat his nurse road has stone dividers in middle of road- When car approached Lotus Cinema truck owned by appellants and insured with Insurance Company who were opposite parties before Motor Accidents Claims Tribunal came from opposite direction at a high speed and dashed against right side of car- Due to impact car was damaged and respondent and were injured- Respondent had to undergo treatment- He was operated on day of accident itself and was patient in his own Nursing Home for a month –Held, Court in New India Assurance that liability of insurance company is absolute but is only limited to extent provided by insurance policy- As against this view all other High Court have held that liability to compensate arises only on a finding of negligence- It may not be out of place to mention that though automobile accidents are subject to law of negligence modern proposals consistently favour social insurance model which benefits are payable directly by a fund without any reference at all to injurer while retaining option for victim to claim either limited benefits on a non-fault basis or full damages for negligence Court a Division Bench Ruby Insurance delivered on has suggested necessity of having social insurance to provide cover for claimants irrespective of proof of negligence to a limited extent say month -It has also suggested that instead of a lump sum payment which does not often reach claimants a regular monthly payment to dependants by nationalized insurance company or bank would be desirable- Unless these ideas are accepted by legislature and embodied in appropriate enactments Courts are bound to administer and give effect to law as it exists today- Court conclude by stating that view of judges of High Court has no support in law and hold that proof of negligence is necessary before owner or insurance company could be to be liable for payment of compensation in a motor accident claim case - Appeal dismissed
Key Points: - The judgment holds that the liability of the insurance company is limited to the amount covered by the policy and that payment of compensation can be pursued against either the owner or insurer jointly; liability is not automatically absolute and depends on policy limits (!) (!) (!) . - The Court affirms that proof of negligence by the driver is necessary to sustain liability for compensation under the Motor Vehicles Act; the mere involvement in an accident does not automatically impose liability without negligence or vicarious liability (!) (!) (!) . - The burden of proving a mechanical defect (latent defect) lies on the owners; if a latent defect is alleged, the owners must show they took reasonable care and that the defect remained undiscoverable despite due diligence; mere assertion of defect is insufficient without such proof (!) (!) . - The Tribunal and High Court findings that the lorry driver acted rashly and negligently were upheld; res ipsa loquitur was considered but the core finding rests on driver negligence (!) (!) (!) . - The Court dismissed the appeal and confirmed the Tribunal’s award of Rs. 1,43,400 to the claimant with interest, while clarifying that the liability between insurer and owner could be determined subsequently upon depositing Rs. 20,000 in certain circumstances; the claimant may proceed against either party (!) (!) (!) . - References to English and Indian law show that compulsory insurance aims to ensure compensation regardless of fault, but the burden remains on prove negligence in most contexts (!) (!) (!) .
Judgment
KAILASAM, J. - This appeal is by special leave under Art. 136 of the Constitution by the two appellants against the judgment of the Bombay High Court dismissing their appeal against the judgment of the Additional Motor Accidents Claims Tribunal for Greater Bombay and confirming the award passed by the Tribunal in favour of the respondents and directing the Tribunal to decide the question of the liability of the Insurance Company on its application that its liability is limited to Rupees 20,000 under Section 110E of the Motor Vehicles Act, 1939 referred to as the Act, after giving opportunity to the parties.
2. The applicant in Applicator No. 727 of 1969 before the Motor Accidents Claims Tribunal for Greater Bombay is one Dr. Balkrishna Ramchandra Nayan practising in Bombay and is the respondent in this appeal. On 14th April, 1969 at about 1.00 p.m. the respondent was driving his car No. MRC-4450 towards Fort side on Dr. Annie Besant Road. With him was sitting on the left side in the front seat Malati M Deshmukh, his nurse. The road has stone dividers in the middle of the road. When the car approached Lotus Cinema,. the truck owned by the appellants and insured with the Insurance Company who were opposite parties 1 to 3 before the Motor Accidents Claims Tribunal came from the opposite direction at a high speed and dashed against the right side of the car. Due to the impact the car was damaged and the 1st respondent and Malati M. Deshmukh were injured. Respondent 1 had to undergo treatment. He was operated on the day of the accident itself and was patient in his own Nursing Home for a month till 15th May, 1969. According to him his right arm was operated and kept in plaster and that he had become permanently disabled in discharging his duties as a surgeon and that he had incurred a loss during the closure of the Nursing Home and loss of income due to permanent injury along with other claims. He claimed a sum of Rs. 3 lakhs by way of general and special damages with interest thereon from the date of his application. The owners of the vehicle filed a written statement refuting the claim of the applicant. According to them while the motor lorry was proceeding from Haji Ali towards Worli, they had taken all precaution to keep the lorry in road worthy condition and that at the material time the axle brake ring of the motor lorry came out and the driver therefore lost control of the vehicle and because of this defect which can develop in a running car the driver lost control of the steering wheel. According to them the lorry prior to the accident was being driven at a moderate speed with due care and caution. They contended that the accident did not occur on account of rash and negligent driving on the part of the driver. They also denied the claim of various items of compensation made by the applicant.
3. The Motor Accidents Claims Tribunal framed four issues. The first 2 issues were whether the applicant had proved that the driver of the lorry was driving the vehicle in rash and negligent manner and whether the opposite party had proved that at the time of accident the axle brake ring of the motor lorry came out and the driver lost control of the motor lorry. The other 2 issues related to the question as to whether the applicant received the injuries as a result of this accident and whether he was entitled to the compensation claimed by him.
4. The applicant examined himself and Malati M. Deshmukh who was travelling with him at the time of the accident regarding the incident. He also examined P. Ws. 2 and 3, P. W. 2 a nurse to prove his income from his profession and P. W. 3 a doctor who treated him. On behalf of the appellant 6 witnesses were examined in support of their case that the accident was due to a mechanical failure and not due to any rashness or negligence on the part of the driver.
5. The Tribunal after elaborately discussing the oral and documentary evidence adduced before it found that the accident was due to the r
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