# National Insurance Company Ltd v. Ashish Kumar Patel & Ors

- **Citation:** (2016) 1 ILRA 140
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2016-01-21
- **Case number:** First Appeal from Order No. 165 of 2016
- **Bench:** Surya Prakash Kesarwani
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/national-insurance-company-ltd-v-ashish-kumar-patel-ors-43397
- **Pages:** 5

## Headnote

Motor Vehicle Act 1988-173-appeal against
award by Tribunal-on ground-where in
vehicle in excess passengers travelingwithout
valid
driving
license-insurance
company
not
responsible-held-Tribunal
fastened liability upon the appellant-up to
extent of authorized capacity-can not be
interfered-appeal dismissed.
Held: Para-8
So far as the submission of the learned
counsel for the appellant disputing the
liability of the Insurance Company to pay
the awarded amount is concerned, I find
that it is wholly undisputed that authorized
seating capacity of the offending vehicle
was six while passengers travelling in the
vehicle
were
17
but
the
Insurance
Company can escape its liability to pay
compensation
with
respect
to
the
authorized number of passengers travelling
in the offending vehicle. That apart, in the
impugned award, the appellant-Insurance
Company
has
been
granted
right
of
recovery from the owner of the vehicle of
the awards over and above the awards of
six persons i.e. the awards which may be
given in respect of the persons over and
above the authorized sitting capacity of the
offending vehicle.
Case Law discussed:
TAC 2014 (3) SC 29; JT 2011 (3) SC 149; JT
2004 (1) SC 15:2004 (2) SCC 1; JT 2007 (10)
SC 209:2007 (7) SCC 445.

## Text

140
 INDIAN LAW REPORTS ALLAHABAD SERIES
respondent dated 26 October 2015 and all
proceedings taken against the appellant.
-------
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 21.01.2016
BEFORE
THE HON'BLE SURYA PRAKASH
KESARWANI, J.
First Appeal from Order No. 165 of 2016
National Insurance Company Ltd. Appellant
Versus
Ashish Kumar Patel & Ors.
Respondents
Counsel for the Appellant:
Manish Kumar Nigam
Counsel for the Respondents:
--
Motor Vehicle Act 1988-173-appeal against
award by Tribunal-on ground-where in
vehicle in excess passengers travelingwithout
valid
driving
license-insurance
company
not
responsible-held-Tribunal
fastened liability upon the appellant-up to
extent of authorized capacity-can not be
interfered-appeal dismissed.
Held: Para-8
So far as the submission of the learned
counsel for the appellant disputing the
liability of the Insurance Company to pay
the awarded amount is concerned, I find
that it is wholly undisputed that authorized
seating capacity of the offending vehicle
was six while passengers travelling in the
vehicle
were
17
but
the
Insurance
Company can escape its liability to pay
compensation
with
respect
to
the
authorized number of passengers travelling
in the offending vehicle. That apart, in the
impugned award, the appellant-Insurance
Company
has
been
granted
right
of
recovery from the owner of the vehicle of
the awards over and above the awards of
six persons i.e. the awards which may be
given in respect of the persons over and
above the authorized sitting capacity of the
offending vehicle.
Case Law discussed:
TAC 2014 (3) SC 29; JT 2011 (3) SC 149; JT
2004 (1) SC 15:2004 (2) SCC 1; JT 2007 (10)
SC 209:2007 (7) SCC 445.
(Delivered by Hon'ble Surya Prakash
Kesarwani, J.)
1. Heard Shri Manish Kumar
Nigam, learned counsel for the appellant.
2.
This appeal has been filed
challenging the award dated 14.10.2015 in
M.A.C.P. No.145 of 2013 passed by the
Motor Accident Claims Tribunal/Additional
District Judge, Court No.1, Chandauli
awarding a sum of Rs.74,150/- to the
claimant-respondent on account of serious
injuries on 5.10.2013 in an accident caused
by the vehicle (Magic) bearing Registration
No.UP-45 T-1563 in which the injured and
some other passengers were travelling.
3.
Learned counsel for the appellant
submits that the authorized seating capacity
of the offending vehicle was 6 while 17
passengers were travelling and, therefore,
the Tribunal has committed a manifest error
of law in fixing the liability of the Insurance
Company to pay compensation instead of
the liability of the owner of the vehicle in
question. He submits that driver of the
offending vehicle was not having a valid
driving licence. Hence in view of the
decision of the Hon'ble Supreme Court in
the case of United Indian Insurance Co. Ltd.
vs. Sujata Arora and others, TAC 2014 (3)
SC 29, the appellant has no liability to pay
the awarded amount.
4. I have carefully considered the
submission of the learned counsel for the
appellant.
1 All. National Insurance Company Ltd. Vs. Ashish Kumar Patel & Ors.
141
5. Briefly stated the facts of the
present case are that on 5.10.2013 the
claimant-respondent was travelling in a
vehicle (Magic) bearing Registration No.
UP45 T-1563. Several other passengers
were also travelling in the said vehicle,
which caused an accident at about 11.30
P.M. in which the claimant-respondent
injured. An F.I.R was lodged at about
4.00 A.M. on the next date i.e. 6.10.2013.
Thus, the F.I.R was lodged after few
hours of the accident. The claim petition
was filed by the claimants-respondents,
who are successors of the deceased.
6.
In the impugned award, the
Tribunal has considered oral as well as
documentary evidence and recorded a
finding of fact with regard to the
occurrence
of
the
accident
as
aforementioned in which the aforesaid
claimant-respondent
received
serious
injuries. It also recorded the finding of fact
that the offending vehicle was covered
with valid documents including the
Insurance Policy and the driver of the
vehicle was having a valid driving licence.
The
Tribunal
also
considered
the
contention of the appellant as being raised
before this Court as aforenoted but rejected
the said contention relying upon the
judgment of Hon'ble Supreme Court in the
case of United India Insurance Co. Ltd. vs.
K.M. Poonam & others, JT 2011 (3) SC
149. The Tribunal computed award of
Rs.74,150/-. The quantum of award is not
disputed before this Court but the dispute
is only with regard to the liability of the
Insurance Company to pay compensation.
The case of the appellant Insurance
Company is that the Insurance Company is
not liable to pay compensation under the
facts and circumstances of the case and
instead the owner of the offending vehicle
is liable to pay the awarded amount.
7. In the case of United Indian
Insurance Co. Ltd. vs. Sujata Arora and
others (supra), heavily relied by the
learned counsel for the appellant; it was
held that where the Tribunal has recorded
a finding that the vehicle, at the relevant
point of time; was not being driven by the
person holding a valid driving licence,
then, it amounts to violation of terms and
conditions of insurance policy and no
liability can be fastened on the Insurance
Company. In the impugned award, the
Tribunal has recorded a finding of fact
that the driving licence of the driver of the
offending vehicle was filed in evidence,
which established that driving licence was
effective from 12.4.2012 to 11.2.2014
while the date of accident was 5.10.2013,
and thus, as on the date and time of the
accident, the driving licence of the driver
of the offending vehicle was valid and
effective and no evidence contrary to it
could be filed by the appellant-Insurance
Company. Thus, the judgmenet relied by
the learned counsel for the appellant does
not support the case of the appellant on
the facts of the present case.
8. So far as the submission of the
learned
counsel
for
the
appellant
disputing the liability of the Insurance
Company to pay the awarded amount is
concerned, I find that it is wholly
undisputed
that
authorized
seating
capacity of the offending vehicle was six
while passengers travelling in the vehicle
were 17 but the Insurance Company can
escape its liability to pay compensation
with respect to the authorized number of
passengers travelling in the offending
vehicle. That apart, in the impugned
award, the appellant-Insurance Company
has been granted right of recovery from
the owner of the vehicle of the awards
over and above the awards of six persons
142
 INDIAN LAW REPORTS ALLAHABAD SERIES
i.e. the awards which may be given in
respect of the persons over and above the
authorized
sitting
capacity
of
the
offending vehicle.
9. The view taken by the Tribunal in
the impugned award is well supported by
the law laid down by Hon'ble Supreme
Court in the case of United India
Insurance Co. Ltd. vs. K.M. Poonam &
others (supra) in which it has been held as
under:
20. The law as regards the liability
of insurers towards third parties killed or
injured in accidents involving different
types of motor vehicles, has been
crystallized in the several decisions of this
court referred to hereinabove. The kind of
third party risk that we are concerned
with in this case involves purported
breach of the conditions contained in the
insurance agreement executed by and
between the insurer and the insured.
21. From the decision in Baljit
Kaur's1 case (supra), which was later
also articulated in Anjana Shyam's2 case
(supra) what emerges is that a policy of
insurance, in order to be valid, would
have to comply with the requirements of
Chapter XI of the Motor Vehicles Act,
1988, which deals with insurance of
motor vehicles against third party risks.
Section 146 of the Act stipulates that no
person shall use, except as a passenger,
or cause or allow any other person to use,
a motor vehicle in a public place, unless
there is a valid policy of insurance in
relation to the use of the vehicle
complying with the requirements of the
said Chapter. Section 147 of the Act is an
extension of the provisions of Section 146
and sets out the requirements of policies
and the limit of their liability. Section 147
(1) (a) provides that a policy of insurance
must be issued by a person who is an
authorized insurer. Section 147 (1) (b)
provides that a policy of insurance must
be a policy which insures the person or
class of persons specified in the policy to
the extent specified in sub-section (2).
Sub-section (2) of Section 147 indicates
that subject to the proviso to sub-section
(1) which excludes the liability of the
insurer in certain specific cases, a policy
of insurance referred to therein must
cover any liability incurred in respect of
any accident, inter alia, for the amount of
liability incurred.
22. However, in order to fix the
liability of the insurer, the provisions of
Section 147 have to be read with Section
149 of the Act which deals with the duty
of the insurer to satisfy judgments and
awards against persons insured in respect
of third party risks. Although, on behalf of
the Insurance Company it has been
sought to be contended that no third party
risks were involved in the accident and
that the persons travelling in the ill-fated
vehicle were gratuitous passengers, the
Insurance Company cannot get away
from the fact that the vehicle was insured
for carrying six persons and the liability
of the Insurance Company was to pay
compensation to the extent of at least six
of the occupants of the vehicle, including
the driver.
23. Sub-section (1) of Section 149 of
the Motor Vehicles Act, 1988, makes it
amply clear that once a certificate of
insurance is issued under sub-section (3)
of Section 147, then notwithstanding that
the insurer may be entitled to avoid or
cancel the policy, it shall pay to the
person entitled to the benefit of the decree
any sum not exceeding the sum assured,
payable thereunder, as if he was the
judgment debtor, in respect of the
1 All. National Insurance Company Ltd. Vs. Ashish Kumar Patel & Ors.
143
liability, together with any amount
payable in respect of costs and any sum
payable in respect of interest on that sum
by virtue of any enactment relating to
interest on judgments. Sub-section (2),
however, places a fetter on the payment of
any sum by the insurer under sub-section
(1) in respect of any judgment or award
unless, the insurer had notice of the
proceedings in which the said judgment
or award is given and an insurer to whom
such notice is given shall be entitled to be
made a party thereto and to defend the
action on the grounds enumerated therein
involving a breach of a specified
condition of the policy.
24. The liability of the insurer,
therefore, is confined to the number of
persons covered by the insurance policy
and not beyond the same. In other words,
as in the present case, since the insurance
policy of the owner of the vehicle covered
six occupants of the vehicle in question,
including the driver, the liability of the
insurer would be confined to six persons
only, notwithstanding the larger number
of persons carried in the vehicle. Such
excess number of persons would have to
be treated as third parties, but since no
premium had been paid in the policy for
them, the insurer would not be liable to
make payment of the compensation
amount as far as they are concerned.
However, the liability of the Insurance
Company to make payment even in
respect of persons not covered by the
insurance policy continues under the
provisions of sub-section (1) of Section
149 of the Act, as it would be entitled to
recover the same if it could prove that one
of the conditions of the policy had been
breached by the owner of the vehicle. In
the instant case, any of the persons
travelling in the vehicle in excess of the
permitted number of six passengers,
though entitled to be compensated by the
owner of the vehicle, would still be
entitled to receive the compensation
amount from the insurer, who could then
recover it from the insured owner of the
vehicle.
25. As mentioned hereinbefore, in the
instant case, the insurance policy taken
out by the owner of the vehicle was in
respect of six passengers, including the
driver, travelling in the vehicle in
question. The liability for payment of the
other passengers in excess of six
passengers would be that of the owner of
the vehicle who would be required to
compensate the injured or the family of
the
deceased
to
the
extent
of
compensation awarded by the Tribunal.
(Emphasis supplied by me)
26. Having arrived at the conclusion
that the liability of the Insurance Company
to pay compensation was limited to six
persons travelling inside the vehicle only
and that the liability to pay the others was
that of the owner, we, in this case, are faced
with the same problem as had surfaced in
Anjana Shyam's case (supra). The number
of persons to be compensated being in
excess of the number of persons who could
validly be carried in the vehicle, the
question
which
arises
is
one
of
apportionment of the amounts to be paid.
Since there can be no pick and choose
method to identify the five passengers,
excluding the driver, in respect of whom
compensation would be payable by the
Insurance Company, to meet the ends of
justice we may apply the procedure adopted
in Baljit Kaur's case (supra) and direct that
the Insurance Company should deposit the
total amount of compensation awarded to
all the claimants and the amounts so
deposited be disbursed to the claimants in
144
 INDIAN LAW REPORTS ALLAHABAD SERIES
respect to their claims, with liberty to the
Insurance Company to recover the amounts
paid by it over and above the compensation
amounts payable in respect of the persons
covered by the Insurance Policy from the
owner of the vehicle, as was directed in
Baljit Kaur's case.
27. In other words, the Appellant
Insurance Company shall deposit with the
Tribunal the total amount of the amounts
awarded in favour of the awardees within
two months from the date of this order and
the same is to be utilized to satisfy the claims
of those claimants not covered by the
Insurance Policy along with the persons so
covered. The Insurance Company will be
entitled to recover the amounts paid by it, in
excess of its liability, from the owner of the
vehicle, by putting the decree into execution.
For the aforesaid purpose, the total amount
of the six Awards which are the highest shall
be construed as the liability of the Insurance
Company. After deducting the said amount
from the total amount of all the Awards
deposited in terms of this order, the
Insurance Company will be entitled to
recover the balance amount from the owner
of the vehicle as if it is an amount decreed by
the Tribunal in favour of the Insurance
Company. The Insurance Company will not
be required to file a separate suit in this
regard in order to recover the amounts paid
in excess of its liability from the owner of the
vehicle.
10. In view of the above discussions,
I do not find any merit in this appeal.
Consequently, the appeal fails and is
hereby dismissed.
11. The amount deposited before
this Court shall be remitted to the
Tribunal concerned for adjustment.
-------
APPELLATE JURISDICTION
CRIMINAL SIDE
DATED: LUCKNOW 23.02.2016
BEFORE
THE HON'BLE SURENDRA VIKRAM SINGH
RATHORE, J.
THE HON'BLE PRATYUSH KUMAR, J.
Criminal Appeal No. 261 of 2014
and Criminal Appeal No. 262 of 2014
Ashfaque
 ...Appellant
Versus
State of U.P.
...Respondents
Counsel for the Appellant:
Rajbaksh Singh
Counsel for the Respondents:
Govt. Advocate
(A)Criminal
Appeal-against
conviction
offence under Section 489-B IPC life
imprisonment-with fine Rs. 25000/- and
489-C IPC, 7 years Respondent -1 with
fine Rs. 7000/-on ground for same offence
twice
punishment
not
permissibleargument
that
mere
possession
of
counterfeit currency-can not be termed as
accused-held-since denial the charges-no
explanation about possession of such
currency given-appellant failed discharge
their burden of proof-as per Section 106 of
evidence act inference drawn by Trail
Court-proper-findings
warrant
no
interference-but when major punishment
of
life
imprisonment's
there-minor
punishment u/s 489-uncalled for -set-aside.
Held: Para-26
Since the appellants had preferred to
plead total denial,they had not cared to
explain as to why such currency notes
were
in
their
possession
though
according to provisions contained in
Section 106 of the Evidence Act the
burden was on them to explain it. Their
failure to do so raises an adverse
inference against them and for such