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Case Number

First Appeal From Order No. 659 of 1987 and Cross-Obection No. 45-CII of 1991

Advocates

Arun Kumar
V.B.Aggarwal
L.M.Suri
J.C.Nagpal
Deepak Suri

Judges

G.R Majithia
A.S Nehra, JJ.

Acts

clause (b) of sub-section (1) of Section 95 of the Motor Vehicles Act, 1939 (for short, the Act).

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Smart Summary

Analytical Summary of the Opinion

Factual and Procedural Background

This case arises from an award dated March 9, 1987, by the Motor Accidents Claims Tribunal, Karnal, against which National Insurance Company Ltd. (the appellant) filed a first appeal (F.A.O. No. 659 of 1987) before this Court. The appeal was admitted and execution against the appellant was stayed by an interim order dated June 14, 1987.

On December 9, 1985, a tempo (No. HYL‑187) carrying oil canisters departed Karnal for Chandigarh around 10:00 p.m. The tempo was driven by respondent Harish Kumar, owned by respondent Mohinder Singh, and insured with the appellant. The tempo carried the owner of the cargo, claimant Ravinder Goyal, the driver Harish Kumar and the cleaner Kala. Near Shamgarh on the G.T. Road the tempo collided with a truck ahead which had suddenly applied its brakes. All three occupants were injured; the cleaner Kala died the following day. Ravinder Goyal filed a claim petition seeking Rs. 3,00,000/-. The Tribunal ultimately found for the claimant and awarded Rs. 63,700/-, holding the driver, owner and the insurance company jointly and severally liable.

In the present appeal the appellant challenges the Tribunal's finding of liability against the insurance company, while not disputing the occurrence of the accident or the quantum awarded.

Legal Issues Presented

Whether Kala died because of the rash and negligent driving of Tempo No. HYL‑187 by respondent Harish Kumar as alleged?
To what amount of compensation, if any, the claimants are entitled and from whom?
Whether the petition is bad for non‑joinder of necessary parties?
Whether the petition is bad for mis‑joinder of parties?
Whether the petition is time barred?
Whether the petition is not maintainable in the present form?
Whether the liability of the respondent No. 3 (insurance company) is limited under the Insurance Policy, Motor Vehicles Act and Workmen's Compensation Act?
Whether the tribunal has no jurisdiction to try the present petition?
Whether the driver of the offending tempo was not holding a valid driving licence at the time of accident?
Whether the claimants are estopped to file the present petition by their own act and conduct?
Relief (general).

Arguments of the Parties

Appellant / National Insurance Company Ltd. (as presented in the appeal)

The appellant did not dispute the occurrence of the accident or the amount of compensation awarded.
The appellant's sole contention on appeal was that the insurance company's liability is not covered under clause (b) of sub‑section (1) of Section 95 of the Motor Vehicles Act, 1939; hence, under Section 96(1) the insurer was not liable to satisfy the Tribunal's award.
It was submitted that the deceased (Kala) was not travelling in the goods vehicle by reason of or in pursuance of any contract of employment and therefore the risk was not one required to be covered under Section 95(1)(b).
The appellant relied on several authorities said to support that proposition (enumerated in the text).

Respondents — Driver and Owner (pleadings before the Tribunal)

The driver and owner jointly filed written statements raising preliminary objections: improper joinder of parties; the petition not properly signed and verified by the claimant; the number of the truck involved in the accident not disclosed; and they denied the allegations in the petition.
The owner in a separate written statement took identical pleas to those of the driver.

Insurance Company — Defences in Written Statement (as pleaded before the Tribunal)

The insurance company pleaded that the accident occurred due to rash and negligent driving and the sudden braking of the unknown truck, and that such truck driver was liable to satisfy the claim.
The written statement alleged that the claimant lacked locus standi to maintain the claim petition.
The insurer contended its liability was limited to Rs. 1,50,000/‑ (as per policy limits referred to in pleadings).
The statement asserted the F.I.R. was registered in collusion with the police and that the claimant had not suffered grievous or permanent injury and that the claim was excessive.
The insurer alleged the tempo driver was driving on the left side and that when the truck suddenly applied its brakes the tempo driver tried to brake but could not avert the accident, and thus argued the accident was the result of the truck driver's rash and negligent driving.

Claimant (Ravinder Goyal)

The claimant filed a claim petition alleging fatal injuries to Kala and sought compensation of Rs. 3,00,000/‑. The Tribunal accepted liability and assessed compensation at Rs. 63,700/‑, awarding it against the driver, owner and the insurance company jointly and severally.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court in this Opinion
Oriental Fire and General Insurance Co. Ltd. v. Gurdev Kaur (1967 69 PLR 461 F.B.)	Authority said to support the submission that liability of insurer is not covered under clause (b) of s.95(1) where the deceased was not travelling by reason of employment.	The Court acknowledged that this authority supported the appellant's substantive legal contention but noted that because the insurer had not pleaded this defence below it could not be raised for the first time in appeal.
Des Raj Angra v. Oriental Fire & General Insurance Co. Ltd., Chandigarh (1985‑1 87 PLR 543) — Full Bench	Authority supporting the appellant's submission regarding limits of insurer's liability under s.95(1)(b).	The Court observed the decision supported the appellant's legal point, but reiterated it could not be pressed in appeal because the insurer had not pleaded it before the Tribunal.
Oriental Fire & General Insurance Co. Ltd., Solapur v. Hirabhai Vithal Nikam (1988 2 A.C.J 435) — Full Bench, Bombay High Court	Authority cited in support of the contention that insurer's liability is circumscribed by s.95(1)(b).	The Court treated it as supportive of the appellant's legal position but held the procedural failure to plead the defence below precluded raising it in this appeal.
National Insurance Co. Ltd. v. Dundamma (1992 A.C.J 1) — Full Bench, Karnataka High Court	Authority cited for the proposition that insurer may not be liable where s.95(1)(b) does not apply.	The Court acknowledged the authority but declined to allow the insurer to rely on it in the present appeal because the insurer had not raised the defense in the Tribunal.
National Insurance Co. Ltd v. Smt. Subhash Kumari (1989‑2 96 PLR 512)	Principle: An insurance company cannot, for the first time in appeal, raise an entirely new plea not taken in its written statement, where allowing it would prejudice claimants.	The Court cited this decision approvingly to support its conclusion that it would be contrary to justice to permit the insurer to take up this ground in appeal for the first time.
Dalbir Singh v. Krishna (1990 A.C.J 800)	Principle: Where the insurance company did not take a particular plea in its written statement and no issue was framed on it, the insurer cannot be held not liable on that basis in appeal; an unpleaded defence cannot be allowed for the first time.	The Court relied on the dictum in Dalbir Singh to hold that because the insurer failed to plead the defence under Section 95(1)(b) before the Tribunal, it could not be allowed to raise that defence in the first appeal.

Court's Reasoning and Analysis

The Court proceeded by (a) summarising the factual matrix and the Tribunal's findings, (b) identifying the sole point taken by the appellant in the appeal, and (c) analysing whether that point could be entertained at the appellate stage.

Key steps in the Court's reasoning:

The Tribunal had found on the evidence that the tempo's driver was rash and negligent (Issue No.1) and awarded Rs. 63,700/‑ to the claimant, holding the driver, owner and insurer jointly and severally liable (Issue No.2 and related findings). The Tribunal also resolved the preliminary objections against the respondents (Issues Nos.3–6) and held the driver held a valid licence.
At hearing before this Court the appellant accepted the facts and quantum but contended that the insurer was not liable under clause (b) of s.95(1) of the Motor Vehicles Act because the deceased was not travelling in the goods vehicle by reason of or in pursuance of any contract of employment; on that basis, the appellant argued s.96(1) excluded its liability.
The Court acknowledged that a number of authorities supported the appellant's legal proposition on the scope of insurer's liability under s.95(1)(b) and the related provisions.
However, the Court emphasised a controlling procedural point: the insurance company had not pleaded the defence under s.95(1)(b) in its written statement before the Tribunal; no issue on that point was framed at trial; as a result the claimant had no opportunity to meet the plea or to lead evidence in rebuttal. The Court held that it would be inappropriate to permit the insurer to raise that question for the first time in a first appeal because doing so would cause prejudice to the claimant.
The Court relied on prior decisions (notably National Insurance Co. Ltd v. Smt. Subhash Kumari and Dalbir Singh v. Krishna) where attempts to raise new, unpleaded defences in appeal were repelled for reasons of fairness and procedural propriety. Those authorities reinforced the Court's conclusion that the insurer's belated contention could not be entertained.
Accordingly, despite conceding that the substantive law cited by the appellant supported its contention, the Court refused to consider the point on appeal because of the insurer's failure to raise it below.

Holding and Implications

HOLDING: F.A.O. No. 659 of 1987 fails and is DISMISSED. The dismissal was made with no order as to costs. The cross‑objections were also dismissed for want of merit.

Direct consequences for the parties (as reflected in the opinion):

The Tribunal's award (assessment of compensation at Rs. 63,700/‑ and the finding that the driver, owner and the insurance company are jointly and severally liable) is left unimpaired by this appeal, since the appeal was dismissed.
The insurer cannot, on the facts of this case, rely on the defence under Section 95(1)(b) for the first time in this Court because it was not pleaded before the Tribunal; the claimant was thereby deprived of the opportunity to meet that defence at trial.

The Court's decision rests on procedural fairness and the rules of pleadings: the opinion does not purport to overrule or modify the substantive authorities relied upon by the appellant; it declines to entertain that substantive contention because of the insurer's procedural omission. No new legal precedent altering the substantive law on insurer liability under Section 95(1)(b) is stated in the opinion.

Opinion authored by G.R. Majithia, J.; order reported with entry "Appeal dismissed." (A.S. Nehra, J. concurred as per signature block).

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National Insurance Co. Limited v. Ravinder Goyal And Others

G.R Majithia, J.:— National Insurance Company Ltd. aggrieved against the award of the Motor Accidents Claims Tribunal, Karnal (hereinafter the ‘Tribunal’) dated March 9, 1987 has come up in appeal to this Court.

2. This appeal come up for motion hearing on June 14, 1987 and the Bench passed the following order:—

“Admitted D.B

Execution against the appellant is stayed meanwhile.”

3. It is how this appeal has bean placed before us for disposal.

4. The claimant, Ravinder Goyal, was travelling ???as an owner of the oil canisters loaded in the four-wheeler Tempo No. HYL-187 being driven by respondent-Harish Kumar son of Sultan Khatri. On December 9, 1985 at about 6.00 p.m, canisters of oil were loaded in that tempo from Gur Mandi, Karnal for being transported to Chandigarh. The Tempo was owned by respondent—Mohinder Singh and was insured with the appellant. Besides, the Tempo driver, tempo cleaner Kala and the owner of the cargo Ravinder Goyal were travelling in that tempo. The tempo left Karnal at 10.00 p.m on December 9, 1985 for Chandigarh. As this tempo reached near Shamgarh on the G.T Road, another truck was going ahead of it. The truck driver applied breaks to its vehicle suddenly but the tempo driver could not apply brakes to his tempo and since Harish Kumar, driver, was driving the tempo rashly and negligently; tempo No. HYL-187 banged into the truck moving ahead of it; and as a result of the impact of the accident all the three occupants of the tempo received injuries. They were shifted to Civil Hospital, Karnal. Of them, Kala, tempo cleaner succumbed to his injuries on the following day. Ravinder Goyal, claimant, filed a claim petition before the Tribunal claiming a compensation of Rs. 3,00,000/-.

5. The claim petition was registered by the driver and owner of the offending vehicle, i.e Tempo No. HYL 187 and the appellant (the insurance company). The driver of the tempo, apart from raising preliminary objections, namely, that proper parties were not joined as parties to the claim petition, the petition had not been properly signed and verified by the claimant and the number of the truck which was involved in the accident, was not disclosed, denied the allegations in the petition. Owner of the offending vehicle in a separate written statement took identical pleas as were taken by the driver.

6. The Insurance Company in its written statement pleaded that the accident in question had taken place due to rash and negligent driving and suddenly applying of brakes by the driver of the un-known truck, who is liable to satisfy the claim; that the claimant had got no locus standi to maintain and file the claim petition and that in any case the liability of insurance company was limited to the extent of Rs. 1,50,000/-; that the F.I.R. was registered in collusion with the police; that the claimant had not suffered any grievous injury of permanent nature and the claim was highly excessive; that the tempo driver was driving the vehicle on left side of the road; that when the truck driver suddenly applied the brakes, the tempo driver also at once tried to apply brakes but the time and distance was so short that the accident could not be averted and that the accident is the result of rash and negligent driving of the truck driver.

7. From the pleadings of the parties, the following issues were framed by the tribunal.

1. Whether Kala died because of the rash and negligent driving of Tempo No. HYL-187 by respondent Harish Kumar as alleged? OPP

2. To what amount of compensation, if any, the claimants are entitled and from whom? OPP

3. Whether the petition is bad for non-joinder of necessary parties? OPR

4. Whether the petition is bad for mis-joinder of parties? OPR

5. Whether the petition is time barred? OPR

6. Whether the petition is not maintainable in the present form? OPR

7. Whether the liability of the respondent No. 3 is limited under the Insurance Policy, Motor Vehicles Act and Workmen's Compensation Act? OPR

8. Whether the tribunal has no jurisdiction to try the present petition? OPR

9. Whether the driver of the offending tempo was not holding a valid driving licence at the time of accident? OPR

10. Whether the claimants are estopped to file the present petition by their own act and conduct? OPR

11. Relief.

8. Issue No. 1 was decided in favour of the claimant; issue No. 2 was decided in favour of the claimant and it was held that he was entitled to compensation in the sum of Rs. 63,700/- and that the driver and owner of the offending Tempo No. HYL-187 and the appellant were jointly and severally liable to pay compensation; issues No. 3, 4, 5 and 6 were decided against the respondents and in favour of the claimant, and it was held that the driver of the tempo was holding a valid driving licence at the time of the accident and the Insurance Company was also liable to pay the amount of compensation.

9. At the time of hearing, the learned counsel for the appellant did not dispute the occurrence and the manner in which it had taken place. He also did not assail the correctness of the compensation amount awarded to the claimant. His only contention is that the liability of the Insurance Company is not covered under clause (b) of sub-section (1) of Section 95 of the Motor Vehicles Act, 1939 (for short, the Act). He submits that under sub-section (1) of Section 96 of the Act, the Insurance Company was liable to satisfy only such awards which were in respect of a liability required to be covered by a policy under clause (b) of sub-section (1) of Section 95 of the Act. If the liability was not covered by the said provision, the question of any payment by the Insurance Company pursuant to any judgment by a Tribunal or Court did not arise. The risk in respect of the deceased was not covered nor it was required to be covered under Section 95(1)(b) of the Act because he was not travelling in the goods vehicle by reason of or in pursuance of any contract of employment. In support of his submission, he relied upon Oriental Fire and General Insurance Co. Ltd. v. Gurdev Kaur . 1967 69 PLR 461 F.B., a Full Bench decision of this Court in Des Raj Angra v. Oriental Fire & General Insurance Co. Ltd. Chandigarh . 1985-1 87 PLR 543. a Full Bench decision of the Bombay High Court in Oriental Fire & General Insurance Co. Ltd., Solapur v. Hirabhai Vithal Nikam . 1988 2 A.C.J 435. a Full Bench decision of the Karnataka High Court in National Insurance Co. Ltd. v. Dundamma . 1992 A.C.J 1..

10. There is no dispute that these authorities support the submission made by the learned counsel for the appellant. However, it was obligatory for the Insurance Company to plead that it was not liable to pay the claim in view of the provisions of Section 95(1)(b) read with Section 96 (1) of the Act. If this plea had been taken before the Tribunal, the claimant would have had an opportunity to rebut it and an issue would have been struck and the claimant would have the opportunity to lead evidence that the insurance company was liable. The Insurance Company cannot be allowed to raise this question as an abstract question of law in first appeal.

11. Identical point was raised by the insurance company in National Insurance Co. Ltd v. Smt. Subhash Kumari . 1989-2 96 PLR 512. and S.S Sodhi, J. repelled the submission by observing thus:—

“Faced with this situation, counsel for the Insurance Company sought to take up an entirely new plea, namely, that according to the terms of the Insurance Policy, the Insurance Company was not liable in the case of death or bodily injury to the goods being carried in the tempo. It is for the first time in appeal here that such a point has been sought to be raised. It would clearly be contrary to the interests of justice to permit this to be done as it would patently cause prejudice to the claimants. The Insurance Company cannot, therefore, be heard to take up this ground at that stage.”

12. Again, this question arose in Dalbir Singh v. Krishna . 1990 A.C.J 800., before a Division Bench of this Court. In that case, the Tribunal directed that the compensation amount be paid by the owner and the driver of the offending vehicle. Claim petition against the Insurance Company was dismissed. The claimant had assailed the award of the Tribunal in this Court only on the ground that the Insurance Company was liable. The facts of that case are pari materia with the facts of the instant case. In that case the deceased was travelling in a goods vehicle. The heirs of the deceased moved a claim petition before the Tribunal. The Insurance Company in its written statement denied that the vehicle was ever insured with it. The Tribunal held that the deceased was travelling in a goods vehicle and the Insurance Company was not liable to pay compensation. This part of the award of the Tribunal was assailed in this Court and this Court held thus:—

“After hearing the learned counsel for the parties and going through the records and the insurance policy, we find that view taken by the Tribunal was wholly wrong It could not be disputed that no such plea was taken on behalf of the insurance company in its written statement, nor there was any such issue, claimed. In the absence of any plea and the evidence, it could not be held that the insurance company was not liable to pay the compensation. As observed earlier, the insurance company even denied that the yellow coloured vehicle, No. HYH-1879, was insured with it, but in the presence of the insurance policy produced on the the record, this could no more be disputed.”

13. In the instant case, since the Insurance Company did not take any plea in the written statement before the Tribunal, no issue was framed on this point. Thus, the claimant had no opportunity to meet the plea which is now sought to be raised. We do not think it proper to allow this plea to be raised at this stage in the light of the dictum in Dalbir Singh's case (supra).

14. For the reasons stated above, F.A.O. No. 659 of 1987 fails and is dismissed, but with no order as to costs.

15. No useful arguments were addressed in support of the cross-objections. We find no merit in them and dismiss the same.

Sd/- A.S Nehra, J.

R.M.S

Appeal dismissed.

National Insurance Co. Limited v. Ravinder Goyal And Others

Analytical Summary of the Opinion

Factual and Procedural Background

Legal Issues Presented

Arguments of the Parties

Appellant / National Insurance Company Ltd. (as presented in the appeal)

Respondents — Driver and Owner (pleadings before the Tribunal)

Insurance Company — Defences in Written Statement (as pleaded before the Tribunal)

Claimant (Ravinder Goyal)

Table of Precedents Cited

Court's Reasoning and Analysis

Holding and Implications

National Insurance Co. Limited v. Ravinder Goyal And Others

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