An insurance company cannot be directed to 'pay and recover' if it is not found liable for indemnification, emphasizing case-specific justice.

Order

02/04/2025

1. In these two appeals there was an office objection that the certified copies of the order impugned have not been filed.

2. Certified copies of the impugned order has now been filed and the defect has been cured.

3. Mr. Pawan Kumar Ojha, learned counsel for the appellants submits that a Coordinate Bench of this Court vide order dated 03.05.2024, passed in S.B. Civil Misc. Appeal No.1172/2024 : United India Insurance Co. Ltd. Vs. Babu Lal, while issuing notices, admitted the appeal and disposed of the stay petition.

These two appeals are also similar.

4. The order dated 03.05.2024 reads as under:-

“1. Admit. Issue notice.

Notices be filed within a period of one week.

2. Heard the counsel on stay application.

3. Learned counsel for the appellant submits that the learned Tribunal has wrongly issued directions qua the Insurance Company to 'pay and recover' whereas as held by the learned Tribunal itself, the liability of the Insurance Company to indemnify the owner had not been found out. Hence, once the Insurance Company was not liable to pay the compensation, no direction to pay and recover also could have been issued.

In support of the submission, counsel relied upon the judgment of Hon'ble Supreme Court in Balu Krishna Chavan Vs. Reliance General Insurance Company Limited & Ors; (2023)

ACJ 1546.

4. So far as the judgment in Balu Krishna Chavan's case (supra) is concerned, the same was admittedly a matter pertaining to 'gratuitous passenger'. Further, the Hon'ble Apex Court in the said judgment opined that in cases where the liability of the Insurance Company is decided and is not held to be liable, ordinarily, there shall be no direction to 'pay and recover'. However, in the facts and circumstances arising in each case, appropriate orders are required to be made to meet the ends of justice.

The ratio of the above case would not apply to the present matter as firstly, it does not pertain to 'gratuitous passenger' and secondly, the present is not a case of non coverage. Admittedly, the Insurance policy covers the liability of the unnamed persons (the occupants)

qua which a premium of Rs.300 had been paid.

5. In view of the above observations, no case for grant of interim order is made out. 6. Stay petition is hence, rejected.”

5. In view of the submissions of learned counsel for the appellants and considering the order dated 03.05.2024, passed in S.B. Civil Misc. Appeal No.1172/2024, both these appeals are admitted.

6. Issue notice to the respondents. Notices be filed within a period of one week.

7. Stay petitions in both these appeals are rejected.

8. List these appeals after two weeks along with S.B. Civil Misc.

Appeal No.1177/2024.

(CHANDRA PRAKASH SHRIMALI),J

235 & 238-Ramesh Goyal, P.S./-