2006(6) ALL MR 90


New India Assurance Co. Ltd.Vs.Bijalabai Maruti Dharange & Ors.

First Appeal No.192 of 1999

12th July, 2006

Petitioner Counsel: Mr. S. L. KULKARNI
Respondent Counsel: Mr. D. R. KORDE,Mr. V. P. LATANGE,Mr. S. K. SHINDE,Mr. R. D. BHALERAO

Motor Vehicles Act (1988), Ss.147, 166 - Compensation - Liability of Insurance Company - Plea of breach of conditions - Where owner or Insurance Company is liable and where there is plea of breach of conditions of policy Insurance Company will have to pay first - However, the security be obtained from owner of vehicle which was insured. ACT 2005(II) 721 and 2004(5) ALL MR (S.C.) 1167 - Followed. (Paras 3, 10)

Cases Cited:
National Insurance Co. Ltd. Vs. Bommithi Subbhayamma, ACT 2005(II) 721 [Para 3]
Pramod Kumar Agrawal Vs. Mushtari Begum, 2004(5) ALL MR 1167 (S.C.)=2004 ACJ 1903 [Para 3]
The Oriental Fire and General Insurance Company Vs. Smt. Sharada Tukaram Koli, 2006(2) ALL MR 421=2006 Vol.108(1) B.L.R. 7 [Para 3]
National Insurance Company Ltd. Vs. Baljit Kaur, 2004(5) ALL MR 238 (S.C.)=2004 ACJ 428 [Para 9]


JUDGMENT:- Heard the learned Advocate Mr. S. L. Kulkarni for the Appellant, Mr. D. R. Korde, the learned Advocate for the Respondent Nos.1 to 3, the learned Advocate Mr. S. K. Shinde for the Respondent No.4 and Mr. R. D. Bhalerao for the Respondent No.5.

2. On 30-8-1988 the accident occurred on Nashik-Pune Road in which the truck registration no.MWA 5079 was involved. According to the Appellant the deceased Maruti Dharange was travelling as a fare paying passenger and this was in clear breach of terms of policy.

The heirs of deceased filed Claim Petition which has been allowed by judgment and award dated 12-1-1999 against Respondent Nos.1 to 3.

3. Respondent No.3 who is Insurance Company is before this Court in this Appeal. Points urged before this Court in Memo of Appeal and later in oral submissions are as follows :-

(i) That it is proved case of breach of conditions of policy since goods truck passengers are not allowed to undertake any journey or travelling and Insurance policy will not cover third party liability towards any claim in relation to loss caused due to accident to such passenger.

(ii) On facts it has been proved that the deceased was a passenger travelling in violation of terms of policy and that this fact was proved from the cross-examination of witness no.2 Ashok Patil, who was the Investigating Officer.

(iii) That the law as laid down in reported Judgments :

(a) National Insurance Co. Ltd. Vs. Bommithi Subbhayamma and others, ACT 2005 Vol. II Pg.721;

(b) Pramod Kumar Agrawal and another Vs. Mushtari Begum and others, 2004 ACJ 1903 : [2004(5) ALL MR 1167 (S.C.)] should be followed;

(c) The Oriental Fire and General Insurance Company Vs. Smt. Sharada Tukaram Koli and Ors., 2006 Vol. 108(1) B.L.R. 7 : [2006(2) ALL MR 421];

holding that when there is breach of conditions of policy the Insurance Company is found not be liable, the amount need not to be ordered to be recovered from the Insurance Company, and claimant should recover it from the insured and if at all Insurance Company is required to pay, the security be obtained from the owner of the vehicle which was insured.

4. On perusal of evidence it is seen that fervent reliance is placed by learned Advocate of Appellant on the contents of cross-examination of Applicant's witness no.2 due to which according to the Appellant, the deceased being a passenger in goods transport vehicle is proved as sought to be urged in the contents of paragraph no.3. Relevant portion is quoted below for ready reference :-

"It is true that it revealed in investigation that the driver was transporting the illegal passengers in the goods truck. It is true that the driver was prosecuted for the offence punishable u/s.42 r/w.123 of M. V. Act and this charge was shown in the charge-sheet."

5. In order to test the submissions of learned Advocate for the Appellant this Court has scrutinised the entire evidence of this witness. It is seen that the examination-in-chief of the witness is focussed on the rash and negligent driving etc. In the cross-examination by the vehicle owner i.e. Opponent No.2 what this witness has stated is as follows :-

"I have not received any summons from JMFC Court for deposition as a complainant in that case. I am not exactly in the case against the driver at JMFC Court inspite of service of summons I have not attended the said Court for evidence. I cannot say as to whether JMFC Court, Sangamner has acquitted the accused driver in the case after finding that he was not negligent in driving at the time of the accident. I cannot say exactly as to whether the three persons who expired in the accident were labourers employed by owner for loading and unloading cement bags on the truck. I do not remember now as to whether I conducted the enquiry as to in what capacity three deceased persons were travelling in the said truck. I have not personally prepared charge-sheet against the driver. I recorded the statements of 4 to 5 persons till I filed complaint. I have not brought the case papers about my investigation even though I have been directed to bring the same as per Summons."

6. It is seen that no evidence is led by the vehicle owner and the Insurance company. Entire reliance and thrust of the submission is on what has been sought to be argued as admission of this witness about the status of deceased being a passenger in goods transport vehicle.

7. On facts this Court finds that from oral evidence of witness no.1 for the claimants, the claimant has proved that the deceased was working as a Cooly on truck which was owned by opponent no.1 and driven by Opponent No.2. Relevant portion is as under :-

"On the date of accident, my husband was proceeding from Sangamner to Narayangaon in a truck and he was working as a coolie on the said truck and the truck was lodged with gunny bags containing cement. The truck was owned by Opponent No.1 and it was being driven by Opponent No.2 Aware."

The above stated part of deposition has not been shattered in cross-examination nor it has been countered by any denial by the vehicle owner or by the Insurance Company.

8. This Court therefore finds on facts that the deceased was an employee and not a passenger.

9. Now coming to the judgments relied on by the learned Advocate for the Appellant this Court finds that in all three judgments relied upon by the Appellant the case of National Insurance Company Ltd. Vs. Baljit Kaur, 2004 ACJ 428 : [2004(5) ALL MR 238 (S.C.)] has been referred to.

On reading all the three judgments and aforesaid Baljit Kaur's case it is seen that the judgment in Baljit Kaur's case is rendered by the Apex Court in Constitution Bench consisting of three judges (Coram : Justice V. N. Khare, C.J.I., S. B. Sinha and Dr. A. R. Lakshmanan). Other two judgments of Hon'ble Supreme Court relied on by the learned Advocate for the Appellant are of the Bench strength two.

Under Article 141 of the Constitution of India the law as laid down by the Supreme Court and as interpreted from time to time, law as laid down by larger Bench binds this Court and is to be followed.

10. In view that the judgment in Baljit's case is binding this Court has to follow the rule laid down in that case that where owner or the Insurance company is liable and where there is plea of breach of conditions of policy, it will have to pay first.

11. Course laid down by the Hon'ble Supreme Court in Pramod Agrawal's case is open to the Insurance Company, however for that purpose it will have to be found on facts that the Insurance Company's liability does not arise due to breach of conditions of policy.

12. On the facts this Court has found that breach of conditions of policy is not proved, and therefore, even the benefit as flowing from the precedent in Pramod Agrawal's case [2004(5) ALL MR (S.C.) 1167] (supra) is not available to the Appellant.

13. In the circumstances Appeal has no merit, it is dismissed.

Appeal dismissed.