The insurer cannot deny liability under an 'Act Only Policy' when personal accident coverage was paid, and the Second Schedule of the Motor Vehicles Act applies for compensation assessment.

JUDGMENT :

Satyen Vaidya, J.

This appeal has been filed against the award dated 17.8.2016, passed by the Learned Motor Accident Claims Tribunal-IV, Shimla, H.P. in MAC Petition RBT No. 32-S/2 of 2013.

2. A Maruti Car bearing Registration No. HP-12B-0532, owned by Sh. Kamal Kishore (hereinafter referred to as the ‘owner’), met with an accident near Tribal Bhawan, Dhalli, District Shimla on 8.7.2012. The vehicle went off the road and rolled down into about 150 feet deep gorge. At the time of accident, the said vehicle was occupied by four occupants including the driver named Vijay Thakur. The said Vijay Thakur (driver) and Amarjeet Singh (occupant of front passenger seat) died as result of accident. The other occupants of the vehicle survived.

3. The Driver Vijay Thakur was survived by his father Sh. Ram Lal, mother Smt. Nirmla Devi and wife Smt. Suman Devi (hereinafter referred to as the ‘claimants’). A claim petition under Section 163-A of the Motor Vehicles Act, 1988 was filed on their behalf.

4. It was claimed that the deceased was an employee of the owner, who was paying salary of Rs. 3300/- per month to the deceased Vijay Thakur. The age of the deceased was stated to be 22 years at the time of death. The claimants claimed themselves to be totally dependent upon the deceased, having no other source of income.

5. The owner filed reply and claimed that the vehicle was insured with the insurer i.e. the appellant herein (hereinafter referred to as the ‘insurer’).

6. The insurer also filed a separate reply and raised objections that it was not liable to indemnify the insured, as the insured had purchased an “Act Only Policy”, which did not cover the occupants of the vehicle. It was also contended that Vijay Thakur, driver of the vehicle was driving the vehicle in violation of Rule 3 of Central Motor Vehicles Rules (hereinafter referred to as the ‘Rules’). All other averments in the petition were also denied generally.

7. Learned Tribunal framed following issues:-

“i) Whether the petitioners are entitled for the compensation amount on account of death of Vijay Thakur in a Motor Vehicle accident, as alleged? OPP

ii) If issue No.1 is proved in affirmative, then what should be the quantum of compensation, and form whom? OPP

iii) Whether the petition is not maintainable? OPR

iv) Whether the deceased was driving the vehicle without possessing a valid and effective driving license, as alleged? OPR

v) Whether there is serious breach of conditions on terms and policy of insurance, as alleged? OPR

vi) Relief.”

8. Issues No. 1 and 2 were answered in affirmative and remaining issues were decided in negative. The learned Tribunal assessed the monthly income of the deceased at Rs. 2500/-. A total sum of Rs. 7,35,000/- has been awarded in favour of the claimants as under:-

In addition, interest at the rate of 9% per annum has also been awarded from the date of filing of the petition till actual realization of the award amount. The liability has been fastened upon the insurer.

9. I have heard learned counsel for the parties and have also gone through the record carefully.

10. Mr. Vivek Negi, learned counsel for the insurer has contended that the insured had purchased ‘Act Only Policy’ and hence the driver was not entitled for coverage. It has also been contended that the driver Vijay Thakur was driving the vehicle in violation of the Central Motor Vehicle Rules. He further submitted that the learned Tribunal has erred in not awarding the compensation in accordance with Second Schedule, appended to the Motor Vehicles Act, 1988.

11. On the other hand, Mr. Bhupender Singh Kanwar, learned counsel for the claimants has submitted that the compensation awarded to the claimants is just and fair. The Second Schedule appended to the Act has been held to be redundant by the Hon’ble Supreme Court in Puttamma & others