IMPORTANT POINT
The court clarified the pay and recovery process for compensation claims, emphasizing the need for security from the vehicle owner before compensation is released.

JUDGMENT :

Budi Habung, J.

Heard Ms. R.D. Mozumdar, learned counsel for the appellant. I have also heard Mrs. A. Bujarbaruah, learned counsel appearing on behalf of respondent Nos. 1 to 4.

2. The present appeal has been filed under section 173 of the Motor Vehicle Act, 1988 assailing the judgment and order dated 02.7.2015, passed by the Member, MACT No.2 Kamrup in MAC Case No.1118/2012.

3. The brief fact of the case is that the respondents/claimants filed a claim petition seeking compensation of Rs.9,90,000/- from the opposite party/appellant for the death of the late Mahesh Kumar in Motor Accident. Upon completion of the trial, by the impugned judgment and order dated 02.7.2015, the learned Tribunal directed the appellant/Insurance Company to pay the awarded amount to the claimants within 90 days from the date of the order, along with interest at the rate of 6% per annum until its realization.

4. However, at the very outset, the appellant clarified that the factum of the case is not disputed. It is submitted that the appellant is aggrieved by the quantum in the judgment dated 2.7.2015, passed by the learned Member, MACT No.2, Kamrup, in MAC Case No.1118/2012. Accordingly, the appellant preferred this appeal on the quantum of compensation amongst other on the following grounds : -

(i) That the learned Tribunal filed to consider the fact, that the appellant company adduced evidence in the case, to the effect that the driver did not have the valid and effective license. To that effect, all the relevant documents were exhibited before the Tribunal by the appellant company, but the learned Tribunal ignored the entire evidences, and directed that the appellant company will make payment of compensation.

(ii) That the owner of the vehicle, knowingly allowed the vehicle to be driven without valid rout permit. Thus, there was violation of policy condition. However, the learned Tribunal overlooked the settled proposition of law, and directed the appellant company to make the payment of compensation. The learned Tribunal failed to consider that once payment is made, it is not possible to recover the amount without any security.

(iii) That the learned Tribunal committed error in directing the appellant company to make the payment, and recover the same from the owner without directing the owner to provide security against the payment.

(iv) That the learned Tribunal committed error of law by ignoring the basic principles as laid down by the Apex Court.

5. For the above reasons, the learned counsel for the appellant submits that the judgment dated 02.7.2015, is flawed to the extent that it imposes a liability of payment of Rs.11,68,460/- along with interest at the rate of 6% per annum as compensation to the claimants. Nevertheless, the learned counsel for the appellant has clarified at this stage that she is not pressing the other grounds raised in the appeal memo. She submits and prays that the quantum of compensation should be determined according to the law established in the case of National Insurance Company Limited vs Pranay Sethi and Others, reported in (2017) 16 SCC 680.

6. The learned counsel for the appellant further submitted that the law is clear regarding the pay and recovery: before releasing the amount to the insured owner of the vehicle, a notice must be issued to the owner, requiring him to furnish security for the entire amounts that the insurer will pay to the claimants. In support of her submission, the learned counsel relied on the decision of the Hon’ble Supreme Court in the case of the Oriental Insurance Co. Ltd vs Shri Nanjappan and others reported in (2004) 13 SCC 224. The learned counsel for the appellant also referenced the decision of this Court in the case of I.A (Civil) 3149/2017 in MAC App 467/2017.

7. The learned counsel for the respondents/claimants fairly submitted that the quantum of compensation requires some corrections. While conceding to the submissions made by the learned counsel for the appellant, she has no ob