# The Oriental Insurance Co. Ltd v. Kanchan Pandey and others

- **Citation:** (2009) 1 ILRA 56
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2008-12-11
- **Case number:** First Appeal From Order No.3775 of 2008
- **Bench:** V.M. Sahai, Ran Vijai Singh
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/the-oriental-insurance-co-ltd-v-kanchan-pandey-and-others-41317
- **Pages:** 7

## Headnote

Motor Vehicle Act 1988-Section 170 and
173-Appeal
against
order-rejecting
application to contest the case passed
under section 170 can be challenged only
under supervisory jurisdiction under Act
227-not under section 173-in absence of
award.

Held: Para 10 & 21

From the aforesaid decisions it is clear
that the insurance company can file
appeal under section 173(1) on all the
1 All] The Oriental Insurance Co. Ltd. V. Kanchan Pandey and others
57
grounds which are available to the
owner of the vehicle and the grounds
mentioned in section 149(2) of the Act if
the application under section 170 had
been allowed by the tribunal. But if the
application is rejected, the appeal can be
filed only on the grounds available under
section 149(2) of the Act, as no appeal is
provided against the order rejecting the
application under section 170. An appeal
under section 173(1) of the Act lies only
against the award of the tribunal and the
order under section 170 not being an
award, no appeal would be maintainable
against such an order. A Division Bench
of this Court, however, has held in
Oriental Insurance Co. Ltd. vs. Smt.
Manju and others 2007 (3) T.A.C. 456
(All)
that
the
order
rejecting
the
application under section 170 of the Act
can be challenged by the insurance
company
under
the
supervisory
jurisdiction of this Court under Article
227 of the Constitution of India. We
respectfully agree with the above view.

The argument of the learned counsel
that the appellant could challenge the
order passed by the tribunal in these
appeals, is liable to be rejected. We have
examined the relief claimed in these
appeal but we do not find that orders
dated 17.4.2007 or 19.9.2007 have been
challenged by the appellant. After the
application
under
Section
170
was
rejected it was open to the appellant to
challenge
the
orders
17.4.2007
or
19.9.2007
under
the
supervisory
jurisdiction of this Court under Article
227 of the Constitution of India. But the
order dated 17.4.2007 or 19.9.2007
cannot be challenged in these appeals,
as an appeal under Section 173(1) of the
Act lies only against the award of the
Motor Accident Claims Tribunal and the
orders under Section 170 not being an
award, no appeal would be maintainable
against such an order.
Case law discussed:
AIR 2002 SC 456, AIR 2006 SC 577, AIR 2006
SC 1255, 2007 (3) T.A.C. 456 (All),

## Text

56 INDIAN LAW REPORTS ALLAHABAD SERIES [2009
Act, 1947. A bare reading of the said
section would demonstrate that Central
Government has to consider as to whether
any dispute exists or is apprehended before
making
reference.
If
the
Central
Government is of the opinion that no
dispute exists or is apprehended, it has
every right to refuse to make the reference.
A dispute may die because of raising of
same with inordinate delay as well as for
other reasons. It is doubt true that no
limitation is provided for raising a dispute,
however, from the language of Section 10
of the Industrial Disputes Act, 1947, it is
apparently clear that only if an industrial
dispute exists or is apprehended, that
reference is to be made. Therefore,
existence of a dispute or apprehension
thereof is a condition precedent for any
reference being made. In the facts of the
present case, the Central Government for
the reasons recorded in the order namely
that the appellant was a casual worker and
has raised the dispute qua his oral
termination/disengagement after more than
13 years has rightly refused to make
reference. Such an action of the Central
Government cannot be said to be illegal,
which may warrant interference under
Article 226 of the Constitution of India.

7. The Hon'ble Supreme Court in the
case of Ajaib Singh (Supra), relied upon
by the learned counsel for the appellant
was considering a case where the High
Court while exercising its jurisdiction
under Article 226 of the Constitution of
India upset an award of the Labour Court
on the ground that there was inordinate
delay in making of the reference qua the
dispute. It is in this background that the
Hon'ble Supreme Court has held that since
no limitation is provided for making a
reference and, in facts of the case reference
was made, it is only for the Labour Court
to mould the relief if there was any delay
in raising of the dispute. It has been held
that the High Court ought not to have
interfered with the award made by the
Labour Court on the ground of delay in
reference. We are, therefore, of the opinion
that the judgment relied upon by the
learned counsel for the appellant has no
application to the facts of the present case.

8. In view of the above, we find no
reason to interfere with the judgment and
order of the Hon'ble Single Judge.

The Special appeal is dismissed.
---------
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 11.12.2008

BEFORE
THE HON'BLE V.M. SAHAI, J.
THE HON'BLE RAN VIJAI SINGH, J.

First Appeal From Order No.3775 of 2008

The Oriental Insurance Company Limited

...Appellant
Versus
Kanchan Pandey & others ...Respondents

Counsel for the Appellant:
Sri Ashok K. Jaiswal

Counsel for the Respondents:

Motor Vehicle Act 1988-Section 170 and
173-Appeal
against
order-rejecting
application to contest the case passed
under section 170 can be challenged only
under supervisory jurisdiction under Act
227-not under section 173-in absence of
award.

Held: Para 10 & 21

From the aforesaid decisions it is clear
that the insurance company can file
appeal under section 173(1) on all the
1 All] The Oriental Insurance Co. Ltd. V. Kanchan Pandey and others
57
grounds which are available to the
owner of the vehicle and the grounds
mentioned in section 149(2) of the Act if
the application under section 170 had
been allowed by the tribunal. But if the
application is rejected, the appeal can be
filed only on the grounds available under
section 149(2) of the Act, as no appeal is
provided against the order rejecting the
application under section 170. An appeal
under section 173(1) of the Act lies only
against the award of the tribunal and the
order under section 170 not being an
award, no appeal would be maintainable
against such an order. A Division Bench
of this Court, however, has held in
Oriental Insurance Co. Ltd. vs. Smt.
Manju and others 2007 (3) T.A.C. 456
(All)
that
the
order
rejecting
the
application under section 170 of the Act
can be challenged by the insurance
company
under
the
supervisory
jurisdiction of this Court under Article
227 of the Constitution of India. We
respectfully agree with the above view.

The argument of the learned counsel
that the appellant could challenge the
order passed by the tribunal in these
appeals, is liable to be rejected. We have
examined the relief claimed in these
appeal but we do not find that orders
dated 17.4.2007 or 19.9.2007 have been
challenged by the appellant. After the
application
under
Section
170
was
rejected it was open to the appellant to
challenge
the
orders
17.4.2007
or
19.9.2007
under
the
supervisory
jurisdiction of this Court under Article
227 of the Constitution of India. But the
order dated 17.4.2007 or 19.9.2007
cannot be challenged in these appeals,
as an appeal under Section 173(1) of the
Act lies only against the award of the
Motor Accident Claims Tribunal and the
orders under Section 170 not being an
award, no appeal would be maintainable
against such an order.
Case law discussed:
AIR 2002 SC 456, AIR 2006 SC 577, AIR 2006
SC 1255, 2007 (3) T.A.C. 456 (All),

(Delivered by Hon'ble V.M. Sahai, J.)

1. These two appeals directed against
the award of the Motor Accident Claims
Tribunal (in brief the tribunal) give rise to
an interesting questions of law, whether the
statutory order under section 170 of the
Motor Vehicles Act, 1988 (in brief the
Act) can be deemed to have been passed;
whether the order passed by the tribunal
rejecting an application under section 170
can be challenged in an appeal under
section 173(1); whether the order passed
by the tribunal permitting the insurance
company to cross-examine the claimant's
witness in absence of the owner satisfies
the requirements of law as provided in
section 170 of the Act?

2. The brief facts are that on
24.1.2005 Shiv Shankar Mishra along with
Dilip Kumar Pandey was going to his
residence, driving Motor Cycle No.UP65/V-6821. The bus no.UP-42/T-2889
collided with motor cycle. Due to injuries
received in the accident Shiv Shanker
Mishra died on the spot. The pillion rider
Dilip Kumar Pandey was also seriously
injured and he died at the hospital. The bus
belonged to U.P. State Road Transport
Corporation. It was insured by the
appellant.

3. The legal representatives of Dilip
Kumar Pandey filed M.A.C.P. No.44 of
2005 claiming Rs.20 lacs as compensation
under section 166 of the Act. The appellant
filed an application under section 170 of
the Act which was rejected on 7.4.2007 by
the tribunal. The claim petition was
allowed by the tribunal and compensation
of Rs.2,11,000/- was awarded to the
claimants. The award of the tribunal dated
27.9.2008 has been challenged by the
appellant in F.A.F.O. no.3775 of 2005.
58 INDIAN LAW REPORTS ALLAHABAD SERIES [2009
4. The legal representatives of Shiv
Shankar Mishra filed M.A.C.P. No.45 of
2005 claiming Rs.25 lacs as compensation
under section 166 of the Act. The appellant
filed an application under section 170 of
the Act on which an order was passed on
19.9.2007 permitting the appellant to
cross-examine the witness produced by the
claimants PW-1, as the owner was not
present. The claim petition was allowed by
the
tribunal
and
compensation
of
Rs.2,23,000/-
was
awarded
to
the
claimants. The award of the tribunal dated
17.10.2008 has been challenged by the
appellant in F.A.F.O. no.3776 of 2005.

5. In both the claim petitions
identical evidence was led and almost
identical findings were recorded. The
tribunal held that motor cyclist was not
negligent and the accident took place due
to rash and negligent driving of the driver
of the bus. The driving licence of its bus
driver Jagarnath was valid. The claim
petition was not bad for non-joinder of
necessary parties. The bus was not being
driven in breach of insurance policy, and
the
claimants
were
entitled
to
compensation from the appellants.

6. Both the claim petitions have been
allowed, with regard to the same accident,
by the same tribunal, although on different
dates. However, both the appeals, with the
consent of the counsel for the appellant,
are heard together.

7. We have heard the learned counsel
for the appellant. In F.A.F.O. No.3775
challenging the award of the tribunal in
M.A.C.P. No.44 of 2005, the learned
counsel has urged that the order passed on
application under section 170 by the
tribunal rejecting the application can be
challenged in an appeal under section
173(1) of the Act, because the appellant
wants to challenge the quantum of
compensation
etc.,
in
absence
of
availability of any grounds of breach of
insurance policy mentioned in section
149(2) of the Act.

8. In F.A.F.O. No.3776, challenging
the award of the tribunal in M.A.C.P.
No.45 of 2005 the learned counsel has
urged that the order passed on application
under
section
170
by
the
tribunal
permitting insurance company to crossexamine the witness of the claimant, in
absence of the owner, amounts to allowing
the application under section 170. He
urged that if any order is passed by the
tribunal on an application under section
170, except an order of rejection, in law, it
would be deemed that the application
under section 170 has been allowed. He
vehemently urged that passing of the order
of rejection would only prevent the
insurance company to contest the claim on
merits on all the points arising in the
award.

9. The peculiar feature of these
appeals is that although they arose out of
the same incident, in which the owner was
common, yet the tribunal has passed two
inconsistent orders on the applications filed
by the insurer for granting permission
under section 170 of the Act. What is the
effect of such inconsistent order, we
propose to examine latter but before it we
may extract Section 170 of the Act,

"Section 170. Impleading insurer in
certain cases - Where in the course of any
inquiry, the Claims Tribunal is satisfied
that-
(a) there is collusion between the
person making the claim and the person
against whom the claim is made, or
1 All] The Oriental Insurance Co. Ltd. V. Kanchan Pandey and others
59
(b) the person against whom the
claim is made has failed to contest the
claim, it may for reasons to be recorded in
writing, direct that the insurer who may be
liable in respect of such claim, shall be
impleaded as a party to the proceeding and
the insurer so impleaded shall thereupon
have, without prejudice to the provisions
contained in sub section (2) of Section 149,
the right to contest the claim on all or any
of the grounds that are available to the
person against whom the claim has been
made."

This section has come up for consideration
before the Apex Court on number of
occasions. It is well settled by the Hon'ble
Court that where an application under
section 170 of the Act had been allowed by
the tribunal, it is open to the insurance
company to challenge the award not only
on the grounds of breach of insurance
policy mentioned in section 149(2) of the
Act, but to contest the claim on merits,
namely, quantum of compensation and all
or any other grounds which were available
to the owner of the vehicle. A three judges
Division Bench in National Insurance
Co. Ltd., vs. Nicolletta Rohtagi and
others AIR 2002 SC 456 had held as
under:-
".......it is open to an insurer to seek
permission of the tribunal to contest the
claim on the ground available to the
insured or to a person against whom a
claim has been made. If permission is
granted and the insurer is allowed to
contest the claim on merits in that case it is
open to the insurer to file an appeal against
an award on merits, if aggrieved. In any
case where an application for permission is
erroneously rejected the insurer can
challenged only that part of the order while
filing appeal on grounds specified in subsections (2) of section 149 of 1988 Act.
But such application for permission has to
be bona fide and filed at the stage when the
insured
is
required
to
lead
his
evidence........."

In National Insurance Co. Ltd., v.
Mastan and another AIR 2006 SC 577
the Apex Court held as under:-

"It is beyond any doubt or dispute that
in a proceeding where the right of the
insurer to raise a defence is limited in
terms of sub-section (2) of Section 149, an
appeal preferred by it against an award of
the Motor Accident Claims Tribunal must
only be confined or limit to some extent.
But once a leave has been granted to the
insurer to contest the claim on any ground
as envisaged in Section 170 of the 1988
Act, an appeal shall also be maintainable
as a matter of right, wherein the High
Court can go into all contentions."

The Apex Court in Bijoy Kumar
Dugar v. Bidyadhar Dutta and others
AIR 2006 SC 1255 has held as under:-

"......The appeal being a product of
the statute it is not open to an insurer to
take any plea other than those provided
under section 149(2) of the Act. However,
in a situation where there is collusion
between the claimant and the insurer or
the insured does not contest the claim and
further, if the MACT does not implead the
Insurance Company to contest the claim,
in such a situation it is open to the insurer
to seek permission of the MACT to contest
the claim on the ground available to the
insured or to a person against whom the
claim has been made. If permission is
granted and the insurer is allowed to
contest the claim on merit, in that case it is
open to the insurer to file an appeal
against the Award of the MACT on merits.
60 INDIAN LAW REPORTS ALLAHABAD SERIES [2009
Thus, in such a situation the insurer can
question the quantum of compensation
awarded by the MACT."

10. From the aforesaid decisions it is
clear that the insurance company can file
appeal under section 173(1) on all the
grounds which are available to the owner
of the vehicle and the grounds mentioned
in section 149(2) of the Act if the
application under section 170 had been
allowed by the tribunal. But if the
application is rejected, the appeal can be
filed only on the grounds available under
section 149(2) of the Act, as no appeal is
provided against the order rejecting the
application under section 170. An appeal
under section 173(1) of the Act lies only
against the award of the tribunal and the
order under section 170 not being an
award, no appeal would be maintainable
against such an order. A Division Bench of
this Court, however, has held in Oriental
Insurance Co. Ltd. vs. Smt. Manju and
others 2007 (3) T.A.C. 456 (All) that the
order rejecting the application under
section 170 of the Act can be challenged
by the insurance company under the
supervisory jurisdiction of this Court under
Article 227 of the Constitution of India.
We respectfully agree with the above view.

11. The next question is whether the
order of the tribunal permitting the
insurance company to cross-examine the
witness produced by the claimant amounts
to allowing the application under section
170
of
the
Act?
In
Jyotsnaben
Sudhirbhai Patel's case the apex court in
paragraph 14 held as under:-

"In the instant case, the Insurance
Company
was
impleaded
as
third
respondent. The driver and owner of the
vehicle, though appeared before the
Tribunal, did not contest the proceedings.
They did not file the written statement nor
did they choose to give evidence before the
Tribunal. Admittedly, the appellant filed an
application under S.170 of the Act seeking
permission of the Tribunal to contest the
proceedings giving the necessary details.
The award passed by the Tribunal also
evidently shows that pursuant to this
permission, the counsel for the appellant
Insurance Company cross examined the
witnesses produced by the claimant to
prove the negligence of the offending
vehicle.
Unfortunately,
however,
the
Tribunal, while passing its orders on the
petition filed under S.170 of the Act only
stated that the prayer was granted, though
the mandate of S.170 (b) of the Motor
Vehicles Act states that the Tribunal while
passing an order shall record its reasons."

12. The import of the decision in
Jyotsnaben Sudhirbhai Patel's case is that
the tribunals are required to assign reasons
while allowing or rejecting an application
under section 170 of the Act. The tribunal
cannot ignore an application under section
170. It is mandatory for the tribunal to pass
an order under section 170 either in the
affirmative or in the negative. The reason
for it is that the right to contest of the
insurer depends on the order of the
tribunal. We may point out that an
application may be allowed or the tribunal
sometimes stops short and may direct,
"prayer is granted" or it may say, "heard",
the insurer to examine the witnesses or
cross-examine the witness as in this case.
Or it may reject the application. In
Jyotsnaben Sudhirbhai Patel's case it was
categorically held that since the insurance
company's right to contest gets enlarged,
the recording of reasons and passing of the
order was necessary.
1 All] The Oriental Insurance Co. Ltd. V. Kanchan Pandey and others
61
13. We may now examine whether
the order of the tribunal in M.A.C.P. No.45
of 2005 permitting the insurance company
to cross-examine the witness in absence of
the owner can be said to be allowing or
deemed allowing of the application under
section 170 of the Act. The insurer and the
insured stand on the same footing. But the
insurer is impleaded only where the
insured is in collusion with the insurer, to
safeguard the interest of the insurance
company, and to contest the claim on
merits. The only other circumstance where
the insurance company is allowed to
contest the claim is when the owner is not
contesting. If the contest by the owner is
real then the insurance company cannot be
permitted to cross-examine the witnesses
only because owner was absent on a date.
The order of prayer granted on the
application or heard and permitted to
cross-examine the witness may amount to
allowing the application.

14. Let us examine the orders of the
tribunal. From the awards of both the claim
petitions it is clear that the owner of the
Bus no.UP-42/T-2889 U.P. State Road
Transport Corporation was contesting both
the claim petitions. It had filed written
statements, produced and examined driver
of the bus Jagarnath as DW-1, filed copy
of driving licence of Jagarnath driver 29
Ga-4, registration book of the bus, permit,
insurance policy 27 Ga-2, 29 Ga-2 and 29
Ga-3, naksha nazri (site plan), and
technical report of inspection of bus and
motor cycle. The insurance company had
not led any evidence to establish that
driving licence was invalid or the bus was
being driven in breach of insurance policy.

15. In M.A.C.P. No.44 of 2005, the
application under section 170 of the Act
filed by the insurance company was
rejected on 7.4.2007 by the tribunal by the
following order:-

"Heard. Owner is contesting hence
rejected."

16. The application of the insurance
company had been rejected on 7.4.2007,
therefore, the appellant could assail the
award of the tribunal only on the grounds
mentioned in section 149(2) of the Act and
neither on negligence or contributory
negligence
nor
on
quantum
of
compensation.

17. In M.A.C.P. No.45 of 2005, an
application under section 170 of the Act
was also filed by the insurance company. It
appears on 19.9.2007 the owner was not
present. The tribunal passed an order on
19.9.2007
permitting
the
appellant
insurance company to cross examine the
witness of the claimant PW-1 as the owner
of the bus was absent. It is necessary to
reproduce the order of the tribunal as
below:-

"Heard. Insurance Co. is permitted to
cross examine the witness of petitioner as
owner is not present to cross examine
P.W.I."

18. On the principle laid down by the
Apex Court in Jyotsnaben Sudhirbhai
Patel's case the word "heard" has to be
construed as permitting the insurance
company to contest. But the incident being
same, the owner being common, the
tribunal could not have passed two
contradictory orders.

19. In both the appeals the appellant
had challenged the award of the tribunal on
the questions of negligence or contributory
negligence and quantum of compensation.
62 INDIAN LAW REPORTS ALLAHABAD SERIES [2009
In appeal no.3775 of 2008 arising out of
M.A.C.P. No.44 of 2005 the application
under section 170 had been rejected on
7.4.2007 by the tribunal. The tribunal had
recorded a finding that no evidence had
been led by the insurance company on the
point of breach of insurance policy. No
argument before us, has been raised by the
learned counsel for the appellant on the
grounds mentioned in under section 149(2)
of the Act. The appellant cannot be
permitted to raise the points of negligence
or contributory negligence and quantum of
compensation. The appeal lacks merit and
deserves to be dismissed.

20. So far as appeal no.3776 of 2008
arising out of M.A.C.P. No.45 of 2005 is
concerned the tribunal had recorded a
finding that no evidence had been led by
the insurance company on the point of
breach of insurance policy. No argument
before us, has been raised by the learned
counsel for the appellant on the grounds
mentioned in under section 149(2) of the
Act. The appellant cannot be permitted to
raise
the
points
of
negligence
or
contributory negligence and quantum of
compensation. This appeal also has no
merit and deserves to be dismissed.

21. The argument of the learned
counsel that the appellant could challenge
the order passed by the tribunal in these
appeals, is liable to be rejected. We have
examined the relief claimed in these appeal
but we do not find that orders dated
17.4.2007
or
19.9.2007
have
been
challenged by the appellant. After the
application under Section 170 was rejected
it was open to the appellant to challenge
the orders 17.4.2007 or 19.9.2007 under
the supervisory jurisdiction of this Court
under Article 227 of the Constitution of
India. But the order dated 17.4.2007 or
19.9.2007 cannot be challenged in these
appeals, as an appeal under Section 173(1)
of the Act lies only against the award of
the Motor Accident Claims Tribunal and
the orders under Section 170 not being an
award, no appeal would be maintainable
against such an order.

22. For the aforesaid reasons, we do
not find any merit in both the appeals. The
appeals fail and are accordingly dismissed.

23. The amount of Rs.25,000/-
deposited by the appellant in this court
under section 173 of the Motor Vehicles
Act, 1988 in both the appeals shall be
remitted by the Registry to the Motor
Accident Claims Tribunal within one
month and shall be included in the amount
to be paid by the appellant to the claimants.
---------
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 20.11.2008

BEFORE
THE HON'BLE RAN VIJAI SINGH, J.

Civil Misc. Writ Petition No. 17015 of 2001

Kalika Prasad and others ...Petitioners
Versus
Board of Revenue & others ...Respondents

Counsel for the Petitioners:
Sri V.C. Srivastava

Counsel for the Respondents:
Sri V.K. Singh
Sri Gulab Chandra
Sri Ajay Kumar Sharma
Sri Shamimul Hasnain

U.P. Zamindari Absolution Act 1950Section 195 and 197-readwith Z.A. rule
115-P-allotment of land-Trees planted
by petitioner standing-land not within