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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
H.P. Sandesh, J.
Ujwala Prasad - Appellant
Versus
New India Assurance Company Ltd - Respondent
Miscellaneous First Appeal No. 3920 of 2009, 3916 of 2009, 3917 of 2009, 3918 of 2009, 3919 of 2009, 10548 of 2012
Decided On : 01-10-2020
Insurance Liability - Motor Vehicle Act - Section 149(2)(a)(i)(c), Section 66(1), Rule 57 - The court held that deviation in plying the vehicle outside the permit area does not amount to fundamental breach of the terms of the policy. The insurance company cannot absolve its liability unless fraud is made out. The breach of conditions of the permit cannot be construed as a purpose for the permit. The defence of the insurer that the vehicle in question has been driven beyond the territorial limits amounts to violation of the permit condition is not acceptable. The liability of the insurance company cannot be exonerated and the same does not absolve the insurer. The insurance company is liable to pay compensation.
Fact of the Case:
The appeals were filed by the owner challenging the judgment and award passed in Motor Vehicle Cases. The claimants and legal heirs of the deceased sustained injuries in accidents involving buses. The insurance company denied liability based on permit violations and breach of policy conditions.
Finding of the Court:
The court found that deviation in plying the vehicle outside the permit area does not amount to fundamental breach of the terms of the policy. The insurance company cannot absolve its liability unless fraud is made out. The breach of conditions of the permit cannot be construed as a purpose for the permit. The liability of the insurance company cannot be exonerated and the same does not absolve the insurer. The insurance company is liable to pay compensation.
Issues: The issues involved were whether the insurance company could absolve its liability based on permit violations and breach of policy conditions, and whether the deviation in plying the vehicle outside the permit area amounted to fundamental breach of the terms of the policy.
Ratio Decidendi: The court held that deviation in plying the vehicle outside the permit area does not amount to fundamental breach of the terms of the policy. The breach of conditions of the permit cannot be construed as a purpose for the permit. The liability of the insurance company cannot be exonerated and the same does not absolve the insurer. The insurance company is liable to pay compensation.
Final Decision: The appeals filed by the insured were allowed, and the liability was fastened on the insurance company to satisfy the compensation amount. The insurance company was directed to pay the compensation amount within eight weeks from the date of the judgment. The liability against the insured was set aside, and any amount in deposit was to be refunded to the insured. The records were directed to be sent to the concerned Tribunal.
JUDGMENT
H.P. Sandesh, J. - M.F.A.Nos.3920/2009, 3916/2009, 3917/2009, 3918/2009 and 3919/2009 are filed by the owner challenging the common judgment and award dated 31.12.2008, passed in M.V.C.Nos.36/2007, 4/2007, 7/2007, 8/2007 and 19/2007, on the file of the Civil Judge, (Sr.Dn.) and MACT Doddaballapura, ('the Tribunal' for short) fastening the liability on the insured/owner to pay the compensation.
2. M.F.A.No.10548/2012 is filed by the owner challenging the judgment and award dated 08.07.2011, passed in M.V.C.No.683/2010, on the file of the II Additional District Judge and MACT-II, Davangere, ('the Tribunal' for short), questioning the liability fastened on the owner-cum-insured.
3. This Court vide order dated 11.02.2016 ordered to connect M.F.A.No.10548/2012 along with other appeals since the question involved in the matter is similar and even though M.F.A.No.10548/2012 is different from other cases, it is taken up for common disposal in view of the earlier order.
4. The parties are referred to as per their original rankings before the Tribunal to avoid the confusion and for the convenience of the Court.
5. The appellant/respondent No.1 before the Tribunal, has filed the appeals in M.F.A.Nos.3920/2009, 3916/2009, 3917/2009, 3918/2009 and 3919/2009. The factual matrix of the case is that on 13.08.2005, the claimants and the legal heirs of the deceased Honnagangamma along with other villagers had been to Chikkasagare Village, Korategere Taluk to attend the marriage reception of C. Gayathri and Shashi kumar and they were traveling in the bus belonging to the appellant/respondent No.1 bearing registration No.KA-06/A-4118. When they reached near Doddabelavangala, Kanasawadi Main Road, the driver of the said bus drove the same in a rash and negligent manner and he lost his control over the bus and the said bus fell down towards the right side of tank bund. Due to the impact, Honnagangamma sustained grievous injuries and other petitioners sustained simple and grievous injures and they were immediately shifted to Nelamangala Government Hospital, Prasad Hospital and Jayaprakash Nursing Home. Further they were referred to Ramaiah Hospital where Honnagangamma succumbed to the injuries on the way and others were treated as inpatient and out patient. Hence, they made the claim before the Tribunal.
6. In pursuance of the claim petitions, notice was issued against respondent Nos.1 and 2. Respondent No.1, who is the appellant herein appeared through the counsel and filed written statement denying the averments made in the claim petitions, age, occupation and income and contended that there is an insurance policy and hence, the Insurance Company is liable to pay the compensation.
7. The respondent No.2 Insurance Company filed the written statement denying the accident and also the nature of injuries, avocation and medical expenses. However, contended that the liability is subject to terms and conditions of the policy. Further contended that R.W.1 insured/owner had violated the permit route and timings and hence there is a breach of conditions of policy and Insurance Company is not liable to pay compensation.
8. The claimants examined themselves in all the cases as P.W.1 to P.W.26 and got marked the documents at Exs.P.1 to 263. On the other hand, the respondents also examined one Company witness as R.W.1 and power of attorney holder of respondent No.1 as R.W.2.
9. The Tribunal after considering both oral and documentary evidence placed on record, allowed the claim petitions in part and comes to the conclusion that respondent No.1 is liable to pay the compensation. However, directed the Insurance Company to deposit the amount and liberty was given to recover the said amount from the owner. Hence, these appeals are filed by appellant/respondent No.1 before this Court.
10. The learned counsel for the appellants contend that the Tribunal committed an error in directing the owner to pay the compensation inspite of valid insurance policy was in
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