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2023 Supreme(Bom) 801

IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT NAGPUR
Urmila Joshi-Phalke, J.
Chabu & Ors. – Appellants
Versus
Balaji & Ors. – Respondents
First Appeal No. 1441 of 2019
Decided On : 17-03-2023

Advocates appeared:
Madhur Deo, Advocate, S.S.Ghate, Advocate

The main legal point established in the judgment is that the breach alleged must be fundamental enough to exonerate the Insurance Company from liability under the Employees' Compensation Act, 1923.

Headnote:

Employees' Compensation Act - Appeal - Section 30 - Summary of Acts and Sections: Employees' Compensation Act, 1923 - Section 4 - The court discussed the liability of the owner of the vehicle and the Insurance Company under the Employees' Compensation Act, 1923. It highlighted the interpretation of the insurance policy conditions, breach of policy, and the fundamental nature of the breach in exonerating the Insurance Company from liability.

Fact of the Case:

The deceased was a laborer working with the owner of a vehicle and died in an accident due to the rash and negligent driving of the tractor driver. The claimants sought compensation from the owner of the vehicle and the Insurance Company. The court analyzed the evidence and contentions of the parties to determine liability.

Finding of the Court:

The court found that the breach alleged was not fundamental enough to exonerate the Insurance Company from liability. It emphasized the need for the breach to be so fundamental that it puts an end to the contract and causes the accident. The court also highlighted the evidence regarding the driving license and the interpretation of the insurance policy conditions.

Issues: The issues included the liability of the owner of the vehicle and the Insurance Company, the breach of policy, and the fundamental nature of the breach in exonerating the Insurance Company from liability.

Ratio Decidendi: The court held that the breach alleged was not fundamental enough to exonerate the Insurance Company from liability. It emphasized the need for the breach to be so fundamental that it puts an end to the contract and causes the accident. The court also highlighted the interpretation of the insurance policy conditions and the evidence regarding the driving license.

Final Decision: The first appeal was allowed, and the judgment and award exonerating the Insurance Company from liability were quashed and set aside. The owner of the vehicle and the Insurance Company were held jointly and severally liable to satisfy the claim of the claimants.

JUDGMENT

Urmila Joshi-Phalke, J. - The present appeal is preferred under Section 30 of the Employees' Compensation Act, 1923 (for short, 'the said Act') by claimants challenging judgment and award dated 10.4.2019 passed by learned Commissioner, under Employees' Compensation Act, Labour Court at Chandrapur (learned Commissioner) in Case No.W.C.A.16/2014 holding the respondent No.1 (owner of vehicle) liable to pay compensation and exonerating the respondent No.2 (Insurance Company) from the liability.

2. Facts in brief are that Vasanta Maroti Kodape (deceased) was working with owner of vehicle as a labour since more than 2 years. He was getting Rs.5200/- per month as wages excluding other allowances. The applicant No.1 is widow and applicant Nos.2 and 3 are minor sons of the deceased. On 10.5.2014, the deceased was under the employment of non-applicant No.1 and was working on tractor bearing No.MH-34-L-3919 having its trailer No.MH-34-L-3920 owned by the non-applicant No.1. The said tractor was driven by Ajay Satpute in a zigzag and in a rash and negligent manner due to which the deceased who was sitting in the tractor was thrown from the tractor and fell down on the road. As the deceased was thrown on the ground, he sustained multiple injuries and died.

3. As per contentions of claimants, the deceased died in an accident which was occurred due to rash and negligent driving of the tractor driver during and in the course of employment. It is further contended that at the time of accident, the deceased was 40 years of age and getting Rs.5200/- per month and, therefore, they have claimed compensation Rs.4,78,842/- along with interest @ Rs.12% per annum and 50% penalty. The owner of the vehicle is employer and the offending vehicle was validly insured with the Insurance Company. Thus, the contention of the claimants is that as the said accident took place due to the rash and negligent driving of the tractor driver, during course of employment, the owner of the vehicle and the Insurance Company are jointly and severally liable to pay compensation.

4. In response to the notice, the owner of the vehicle appeared and resisted the claim on the ground that there was no employer and employee relationship between the deceased and the owner of the vehicle. However, the owner of the vehicle admitted the ownership of the vehicle involved in the accident which is inured with the Insurance Company. As per contention of the owner of the vehicle, he had purchased the tractor and trailer for the purpose of hiring it on rent to the needy contractors. The accident occurred due to rash and negligent driving of the driver on whom the contractor has a control and, therefore, he is not liable to pay compensation.

5. The Insurance Company has also resisted the claim on the ground that the driver of the tractor was not holding valid driving licence. Thus, owner of the vehicle has committed the breach of terms and conditions of the policy. It is further contention of the Insurance Company that the owner of the vehicle has not complied with mandatory provisions of Section 4 of the said Act and, therefore, the Insurance Company is not liable to pay compensation.

6. Insofar as issue regarding employer and employee relationship is concerned, learned Commissioner held that evidence on record is sufficient to hold that there was employer and employee relationship. Admittedly, the owner of the vehicle has not challenged the said finding of learned Commissioner and, therefore, the discussion regarding employer and employee relationship, which is not under challenge in this appeal, is not required to be looked into.

7. Before learned Commissioner, the parties led evidence. The claimant No.1 examined herself vide Exhibit-U-

5. The owner of the vehicle also stepped into the witness box vide Exhibit-C-39. On behalf of the Insurance Company, witness No.1 Pankaj Kawaduji Madavi was examined vide Exhibit-C-29 who was serving in the Regional Transport Office and witness No.2 Nites

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