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2022 Supreme(Kar) 371
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
N.S. SANJAY GOWDA, J.
Sri Shivanna, S/o. Nandappa & Ors. - Appellants
Versus
Sri Muniyappa, S/o. Late Muniswamy & Ors. - Respondents
Misc. First Appeal No.6334 of 2014 (MV-I) c/w Misc. First Appeal No.3275 of 2013(MV)
Decided On : 01-08-2022
For the Appellant : Ms. Sunanda Sarkar For Sri. Deepak J.
For the Respondents: Sri. K.T. Gurudeva Prasad, Sri. R. Jaiprakash.
Point of Law: Motor Vehicles Act is a beneficial legislation with the overriding objective of ensuring that the victims of a motor vehicle accident receive their statutory entitlement of just compensation.
Headnote:
Motor Vehicles Act, 1988 - Accident - Compensation - Seeking for Enhancement - An accident had occurred when claimant was riding his motor cycle and offending lorry collided with motor cycle, is not in dispute - Tribunal, initially, awarded a compensation and made Insurance Company liable - However, Insurance Company sought for review of said order. [Para 14]
Finding of the Court: Doctor has stated that claimant has stuttering of speech, memory lapse to day of week calculation, illegible handwriting and he had MMSE score of 18 out of 25 - He has also stated that claimant has a restriction of right upper limb movements -grip, elbow and shoulder movements - He has ultimately stated that based on injuries suffered, total disability would be 87.5% - However, since claimant was aged about 61 years as on date of accident, it would be appropriate to determine total disability at 75% - Tribunal has awarded a sum of Rs.48,000/- towards 'pain and suffering'- Since claimant was on a ventilator and had lost consciousness for more than 20 days, it would be appropriate to enhance same to Rs.1,00,000 - Sum of Rs.7,62,000/- awarded towards 'medical expenses' based on documentary evidence is undisturbed - As noticed above, claimant was unconscious for more than 20 days - Having regard to nature of injuries, claimant must have taken rest for six months - Therefore, sum of Rs.39,000/- (Rs.6,500x6) is awarded towards 'loss of income during laid up period' - Claimant is entitled for total compensation of Rs.15,67,500/- as against Rs.8,44,356/- awarded by Tribunal, with interest at 6% per annum from date of petition till date of realisation - Insurer shall pay said compensation and thereafter proceed to recover same from owner of offending vehicle.
Result: MFA No.3275/2013 is allowed in part.
JUDGMENT :
1. MFA No.3275/2013 is filed by the claimant seeking for enhancement.
2. MFA No.6334/2014 is by the owner, challenging the exoneration of the liability of the Insurer.
3. The fact that an accident had occurred on 20.05.2011 when the claimant was riding his motor cycle and the offending lorry collided with the motor cycle, is not in dispute.
4. The Tribunal, initially, awarded a compensation of Rs.8,44,356/- and made the Insurance Company liable. However, the Insurance Company sought for the review of the said order in RP No.16/2013 and the Tribunal reviewed its earlier order and recalled its finding fastening the liability on the Insurer. The Tribunal thereafter proceeded to pass an order fastening the entire liability on the owner, on the ground that the vehicle in question was a petrol tanker and the driver of the said petrol tanker did not possess the requisite Endorsement to drive the petrol tanker.
5. As could be seen from the contentions advanced by the Insurer in the Review Petition, the basic contention was that there was a breach of the policy conditions, in as much as, the driver though possessed a license to drive a heavy goods vehicle but did not have the additional endorsement to drive the petrol tanker and therefore, it could not be made liable.
6. It is settled law that even in case whether the driver of the vehicle did not possess a valid and effective driving license, the Insurance Company would still nevertheless have to satisfy the compensation and thereafter proceed to recover the compensation from the owner, as per the principles laid down in the case of Shamanna and Another Vs. Divisional Manager, Oriental Insurance Company Limited - (2018) 9 SCC 650.
7. In this view of the matter, the finding of the Tribunal that the Insurer was entitled to be exonerated of its liability will have to be modified and it will have to be held that the Insurer would be first required to pay the compensation to the claimants and thereafter proceed to recover the same from the owner.
8. However, learned counsel for the Insurer submits that the principle of pay and recovery cannot be applied if the owner has entered appearance or the owner has preferred an appeal. The contention sought to be advanced is that the principle of pay and recovery will have to be applied only when there is no contest by the Insured or the Insured has accepted the award and has not preferred any appeal.
9. In my view, this argument is completely misconceived. The Supreme Court in more than one case has held that the principle of pay and recovery is applicable in cases where the vehicle was insured and there was a breach of the policy conditions. It is settled law that the Insurer is bound to indemnify the insured in the event of an accident occurred out of the use of the motor vehicle even if it establishes its defence that there was a breach of the policy conditions.
10. It has also been held that whenever the Insurer puts-forth a defence that it is not liable by successfully proving its defence, the Apex Court has held that they would still be liable to pay the compensation to the claimant and they would be at liberty to recover the compensation that they have paid by proceeding against the insured who had contravened the policy conditions.
11. This, basically means that whenever an accident occurs out of the use of a motor vehicle, which is insured, the Insurer would have to pay the compensation to the victim of the motor vehicle accident, even if it is entitled to avoid the liability and it would thereafter be at liberty to recover the same from the owner of the offending vehicle.
12. In the light of this settled legal proposition, the argument that if the owner has entered appearance, the principle of pay and recovery would not apply cannot be advanced at all.
13. If the owner of the vehicle appears and contests his liability, that would not in
