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IN THE HIGH COURT OF ANDHRA PRADESH AT AMARAVATI
M. VENKATA RAMANA, J.
The New India Assurance Co.Ltd. Rep.by its Divisional Manager, Kakinada - Appellant
Versus
Sri Chintakayala Srinivasa Rao and two others - Respondent
C.M.As.No.561 of 2005 and 188 of 2007
Decided On : 22-03-2021
Workmen Compensation Act. - Section 3(1)- Liability of an insurer to indemnify the insured in case of transfer of the vehicle vis-à-vis the workmen, in terms of Section 3(1) of Workmen Compensation Act - Whether the applicant is entitled to claim for compensation from Opposite Parties 1, 2 and 3?
Finding of the Court:
Insurer cannot be permitted to contend that in case of a transferee who did not get the policy transferred cannot stand to indemnity from any liability. It is also to be noted that it is not the case of any one that the insurer has or had at any point of time repudiated this contract of insurance on account of transfer of the vehicle notifying the purpose of this contract. When subject matter of the contract has thus an incidence attached to it, when its ownership stood changed, the terms of such contract cannot be narrowed down to a small sphere of continuing relationship between the insurer and the original insured. By very nature of things, particularly having regard to nature of subject matter of this contract, i.e. vehicles being in the nature of ‘goods’ in terms of The Sale of Goods Act, when the ownership passes on to the person, who holds or possesses such goods, this instance of transfer cannot interdict the operation of indemnity flowing from the policy of insurance to the subject matter, viz., the vehicle and in turn to the transferee.
Result: Appeal dismissed
JUDGMENT :
1. The short question to consider in these two Civil Miscellaneous Appeals is liability of an insurer to indemnify the insured in case of transfer of the vehicle vis-à-vis the workmen, in terms of Section 3(1) of Workmen Compensation Act.
2. Both these matters are being considered together since the above question is involved in common and on account of arguments addressed for the parties together.
3. The facts concerned to these cases remain in short compass.
4. In C.M.A.No.561 of 2005 the first respondent was the driver of the lorry AP 9W 5731 on the date of the incident, viz. 06.07.2002. The registered owner of this lorry then was the second respondent and the policy of insurance issued by the appellant for this lorry was in his name. The third respondent had purchased this lorry by the date of the incident and the first respondent was working for the third respondent by then. He was being paid Rs.3,000/-per month towards salary.
5. On 06.07.2002, the version of the first respondent before the Commissioner was that he was loading and unloading the raw material like bamboo shafts for A.P.Paper Mills and in that process, when he was driving this lorry at the outskirts of Nakkapalli village at about 11.00 a.m. a bamboo shaft hit his right eye causing bleeding injury and ultimately this injury in spite of treatment lead to loss of vision. On such basis, the first respondent claimed a compensation of Rs.1,80,000/-against the respondents 2 and 3 as well as the appellant before the Commissioner for Workmen Compensation cum Assistant Commissioner of Labour, Kakinada, East Godavari District, in W.C.Case No.1 of 2004.
6. The respondents 2 and 3 did not contest before the Commissioner. The appellant alone contested and denied the claim of the first respondent in entirety. The main contention of the appellant before the Commissioner was that there was no relationship between the first respondent on one hand and the respondents 2 and 3 on the other as servant and master and even otherwise, it is not liable to satisfy the claim of the first respondent in the above circumstances.
7. In C.M.A.No.188 of 2007, the respondents 1 and 2 are the parents of Sri A.Chowdary, the deceased, who was driver of the lorry AP 7V 3956. The registered owner of this lorry then was the third respondent and that he had sold it to the fourth respondent by then. The policy of insurance issued by the appellant for this lorry stood in the name of the third respondent by then and the fourth respondent was paying the premium there for.
8. Contending that their son was a regular driver of this lorry, who was earning Rs.3,500/-per month towards wages and Rs.600/-as batta, who was 24 years old by then, claiming a compensation of Rs.3,75,000/-with future interest at 15% per annum, an application was presented by the respondents 1 and 2 before the Commissioner for Workmen Compensation at Vijayawada, Krishna District. They further claimed that the death of their son due to heart-attack on 16.02.2001, at Gogoi, Rayapur Town, Chattisgarh State was during and in the course of his employment. Thus, they sought the respondents 3 and 4 and the appellant to pay the compensation as claimed jointly and severally.
9. The respondents 2 and 3 did not choose to contest this claim. The appellant alone resisted denying the entire claim including the nature of the accident and that the deceased died in usual course due to illness, which has nothing to do with his employment. It raised a similar contention as in the earlier case denying the relationship between the deceased and the respondents 3 and 4 being servant and masters with reference to its liability, while also questioning the jurisdiction of the Commissioner under Workmen Compensation Act to maintain such an application. Thus mainly denying its liability, it requested to exclude from this claim before the Commissioner.
10. On the material in the case concerned to C.M.A.No.561 of 2005, the Commissioner settled the following issu
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