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2017 Supreme(Del) 2924
IN THE HIGH COURT OF DELHI AT NEW DELHI
R.K. GAUBA, J.
The Oriental Insurance Company Limited - Appellant
Versus
Smt. Rita & Ors. - Respondents
MAC Appeal No. 516 of 2009
Decided On : 18-08-2017
Advocate Appeared:
For the Appellant : Mr. Ram N. Sharma
For the Respondents: Mr. Anshuman Bal
The interpretation of 'third party' under the Motor Vehicles Act and the liability of the insurance company for compensation depend on whether the deceased, who borrowed the vehicle, can be considered a 'third party'.
Headnote:
Motor Vehicles Act - Compensation under Section 163A - Interpretation of 'third party' - Court relied on settled law and previous judgments to rule that the deceased, who borrowed the vehicle from the registered owner, was not covered by the expression 'third party' and therefore the insurance company was not liable for compensation.
Fact of the Case:
The claimants sought compensation under Section 163A of the Motor Vehicles Act for the death of Vipin Sharma in a motor vehicular accident. The Tribunal awarded compensation to the claimants, holding the insurance company liable. The deceased had borrowed the vehicle from the registered owner, leading to the question of whether he was considered a 'third party' under the Act.
Finding of the Court:
The court found that the deceased, by borrowing the vehicle, had stepped into the shoes of the registered owner and was not covered by the expression 'third party'. Relying on settled law and previous judgments, the court set aside the judgment directing the insurance company to bear the responsibility for payment of compensation.
Issues: Interpretation of 'third party' under the Motor Vehicles Act, liability of the insurance company for compensation.
Ratio Decidendi: The deceased, having borrowed the vehicle from the registered owner, was not considered a 'third party' and therefore the insurance company was not liable for compensation.
Final Decision: The appeal of the insurance company was accepted, and the judgment directing the insurance company to bear the responsibility for payment of compensation was set aside. The insurance company was given liberty to recover the amount paid beyond its liability, and the statutory amount was to be refunded.
1. The accident claim case (MACT suit no.694/08/07) instituted by the first to fourth respondents (collectively, the claimants) on 15.11.2007 prayed for compensation under Section 163A of the Motor Vehicles Act, 1988 on account of the death of Vipin Sharma @ Babloo in a motor vehicular accident that occurred on 29.10.2007 involing a motor cycle no.DL-5SU-8644 (motor cycle). The registered owner of the said motorcycle (fifth respondent herein) was impleaded as the first respondent in the said proceedings with the appellant insurance company (insurer) as the second respondent.
2. The Motor Accident Claims Tribunal (Tribunal), by judgment dated 17.08.2009, awarded compensation in favour of the claimants and directed the appellant to pay the said amount rejecting its contention of it not being liable since the deceased was not a third party.
3. It is clear from the pleadings and evidence on record that the deceased had borrowed the vehicle from the registered owner. In this view of the matter, he had stepped into the shoes of the registered owner (insurer) and therefore, would not be covered by the expression “third party”, which liability was undertaken by the insurance company. In view of these facts, following the settled law on the subject, as per rulings of the Supreme Court in New India Assurance Company Ltd. vs. Sadanand Mukhi & Ors., (2009) 2 SCC 417 and Ningamma & Anr. vs. United India Insurance Company Ltd., (2009) 13 SCC 710 and the view taken by this court by judgment dated 02.03.2016 in Oriental Insurance Co. Ltd. Vs. Shakuntala and Anr., MACA 142/2007, the appeal of the insurance company must be accepted. The impugned judgment to the extent it directed the insurance company to bear the responsibility for payment of the compensation is set aside.
4. In terms of interim orders passed on this appeal, the insurance company had deposited the awarded amount with interest, part of which has already been released, some portion having been kept in fixed deposit receipts, inter alia, in terms of directions in order dated 22.12.2009. The amounts still lying in the fixed deposit receipts with corresponding interest shall be refunded to the insurance company which is given liberty to recover the amount paid beyond its liability.
5. The statutory amount shall be refunded.
6. The appeal is disposed of in above terms.
