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2023 Supreme(P&H) 1756

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
Harpreet Singh Brar, J.
Oriental Insurance Company Limited Jind – Appellant
Versus
Manjit Kaur & Ors. – Respondents
F.A.O. No. 405 of 2016
Decided On : 02-06-2023

Advocates appeared:
For the Appellant : Mr. Rajneesh Malhotra
For the Respondent: Mr. Parveen Kumar Rohilla, Mr. B.S. Bairagi

Headnote:(A) Motor Vehicles Act, 1988 - Sections 147 and 168 - Appeal against compensation awarded for death of a gratuitous passenger - Insurance Company contended non-liability due to policy restrictions on covering passengers - Court criticized Tribunal’s joint liability ruling for insurers and vehicle owners, emphasizing statute mandating coverage for third parties. (Paras 6, 11, 13, 28)

(B) Compensation - Principles of just and reasonable compensation standard emphasized - Appellate court exercised powers under Order XLI Rule 33 to adjust compensation to rightful amount considering future prospects and litigation costs. (Paras 27, 30)

Facts of the case:
The accident occurred on 16.02.2012 when the deceased, a gratuitous passenger, was injured due to negligent driving, leading to a fatality. The Tribunal awarded compensation which the Insurance Company contested. (Paras 4, 3)

Findings of Court:
The Insurance Company was held liable for the full awarded compensation as per policy terms; compensation adjusted to Rs.8,58,550/-. (Para 30)

Issues: Whether compensation can be awarded for an unauthorized passenger and who bears the liability. (Para 10)

Ratio Decidendi: The court deemed the Insurance Company liable for compensation owing to the package policy's coverage for third parties, despite the passenger's unauthorized status. The law mandates protection for injured parties. (Paras 14, 28)

Result: Insurance Company’s appeal dismissed; claimant’s appeal partially allowed with re-determined compensation awarded.

Table of Content
1. circumstances of the accident and initial compensation details. (Para 4 , 5 , 6)
2. arguments regarding insurance coverage and compensation assessment. (Para 7 , 8 , 9)
3. liability of insurance company as it pertains to gratuitous passengers. (Para 11 , 12 , 13 , 14 , 15 , 16)
4. court's analysis of the powers under order 41 rule 33 to provide just outcomes. (Para 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26)
5. final award of compensation and its calculation. (Para 27 , 28 , 29 , 30)

Judgment

New Page 1Mr. Harpreet Singh Brar, J.

The Insurance Company through instant appeal bearing FAO No.405 of 2016 is seeking setting aside of the award dated 28.10.2015 passed by Motor Accidents Claim Tribunal, Panipat (in short ‘Tribunal’).

2. The claimant through instant appeal bearing FAO No.4548 of 2016 seeking enhancement of the compensation awarded vide award dated 28.10.2015 passed by the said Tribunal.

3. Both the appeals are arising out of the same award, therefore, both are being heard together and decided through a common judgment.

FACTUAL BACKGROUND

4. Brief facts of the present case are that on 16.02.2012 at about 5:00 PM, Sonu @ Mangat Singh son of Sukhvinder Singh @ Sukha, left for village Bharkhera, District Bundi, (Rajasthan) from village Faridpur, District Panipat. At about 11:30 PM, they reached Jhajjar bypass where they took lift in a Canter (hereinafter ‘offending vehicle’) bearing Registration No.HR-46B-3821 going to Rewari. The driver of the said vehicle was driving the offending vehicle at a high speed, rashly and negligently, despite the request of the deceased and his co-passenger-Jaspal to drive at a moderate speed. At about 12:15 AM, when they reached village Machhrauli, the driver hit a truck preceding them, due to which, front cabin of the offending vehicle was broken and the deceased-Sonu @ Mangat Singh succumbed to the injuries sustained in the accident.

5. The learned Tribunal has framed the following issues:

1. Whether deceased Sonu died in Motor Vehicles accident due to the rash and negligent driving of respondent No.1 of the vehicle bearing registration No.HR-46B-3821?OPP

2. Whether the claimants are entitled to be compensated by the respondents on account of death of deceased in the motor vehicle accident, if Yes, how much and from whom? OPP

3. Whether the respondent No.1 has infringed the conditions of the insurance policy, if so, what its effect? OPR

4. Relief.

6. Learned Tribunal after adjudicating on different issues held that the claimant-Manjeet Kaur is entitled to grant of compensation of a sum of Rs.6,21,000/- on account of death of Sonu @ Mangat Singh. Claimant-Manjeet Kaur shall be further entitled to interest @ 7.5% per annum on the amount of compensation, if the amount is deposited within a period of two months from the date of passing of the award, failing which, respondents shall be liable to pay interest @ 9% per annum on the amount of compensation till its realization.

CONTENTIONS

7. Learned counsel for the Insurance Company has contended that the deceased-Sonu @ Mangat Singh was a gratuitous passenger and he is not covered by the Insurance Policy as the vehicle was registered as a ‘goods vehicle’ and was not supposed to be carrying passengers and has relied upon judgment of the Hon’ble Supreme Court in Anu Bhanvara Etc. Vs. Iffco Tokio General Insurance Company Ltd. and others 2022 (2) SCC (Cri.) 121. Hence, for all intents and purposes, the Insurance Company cannot be held liable for the death of an unauthorized gratuitous passenger.

8. A submission has further been made that in such a case, the claim would only be maintainable against the driver and owner of the offending vehicle. The learned Tribunal has committed a grave irregularity by making Insurance Company and the owner of the offending vehicle jointly and severally liable to compensate the claimants. In this context, he has relied upon the judgment of this Court in Ajay Kumar and others Vs. Darshana Devi and others 2

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