Oriental Insurance Co Ltd v. Bhola Kushwaha & Ors.

1. These two appeals (MAC. APP.565/2010 and MAC.APP. 567/2010) arise out of common judgment dated 04.06.2010 passed by the Motor Accident Claims Tribunal (the Claims MAC APP 565/2010 & 567/2010 Page 1 of[6] 2015:DHC:11347 Tribunal) whereby while awarding compensation of Rs.3,25,000/j- in Suit no.l39/08(01d no.66/07) and Rs.2,79,000/r in Suit no.l50/08(01d no.65/07) in MAC. APP.565/2010 and MAC.APP. 567/2010 respectively, the Claims Tribunal made the Appellant Oriental Insurance Co. Ltd. liable to pay the compensation.

2. The only ground of challenge raised by the Appellant Insurance Company is that the Appellant had successfully proved breach of terms and conditions of insurance policy and therefore, recovery rights ought to have been granted.

3. It is contended that without granting sufficient opportunity to the Appellant, its evidence was closed by the Claims Tribunal by an order dated 01.06.2010. The Appellant Insurance Company moved an application for additional evidence which was allowed by this Court by an order dated 23.05.2013. The learned counsel for the Appellant urges that the Appellant examined three witnesses before this Court to prove that there was conscious and willful breach of the terms and conditions of the insurance policy and the Appellant Insurance Company was therefore, entitledto recovery rights.

4. I have perused the record and the evidence of the three witnesses produced by the Appellant Insurance Company by way of additional evidence.

5. At this stage, it may be noted that notice ofthe appeals were MAC APP 565/2010 &567/2010 Page 2of[6] ordered to be issued to Respondents no.3 and 4, who are the owner and driver of the vehicle no.DL-lLD-5700 which caused the accident in question. Respondent no.3(the owner) preferred not to contest the proceedings despite sufficient service and was ordered to be proceeded exparte by an order dated 02.02.2011. Respondent no.4 expired during the pendency of the-appeal. His legal representatives were not brought on record and the appeals were ordered to have abated against Respondent no.4.

6. The learned counsel for the Appellant thus, claims recovery rights against Respondent no.3 only.

7. First of all, I would refer to the evidence of Smt. Ragni Mehrotra, Manager of the Appellant Insurance Company who was examined as AW-3. She testified that vehicle no. DL-ILD- 5700 was insured for the policy, copy of which was proved as Ex.AW-3/1. She further proved the notice Ex.AW-3/3 purported to have been issued to Baljit Singh, Respondent no.3 whereby he was directed to produce the original policy of insurance as also the driving licence ofthe driver Gulab Singh. AW-3 further proved a notice dated 26.05.2010 issuecllby the Appellant Insurance Company to Gulab Singh(Respondent no.4), driver of the offending vehicle to produce his driving licence. However, inpursuance ofthe notice, neither the driver nor the owner came forward to contest the claim petition before the Claims Tribunal. The owner did not even come forward to contest the instant appeal and as stated earlier, he was ordered MAC APP 565/2010 & 567/2010 Page 3 of[6] to be proceeded exparte. i

8. The Appellant Insurance Company not only required the driver and the owner to produce the original insurance policy and the driving licence but also examined Devender Singh, AW-1, Clerk, RTO, Gurgaon and Bhupendra Shant, AW-2, an independent investigator who proved that the licence purported to be seized by the police (mark D) was not issued by the Transport Authority by which it was purported to be issued.

9. In my view, the Appellant Insurance Company did whatever was in its power to prove that there was conscious and willful breach of the terms and conditions ofthe insurance policy. The onus thereafter shifted upon the owner to prove as to the circumstances under which the driver was engaged and whether he had taken sufficient precautions not to commit the breach of the terms and conditions of the policy. In this cormection, a reference may be made to the judgment of this Court in New India Assurance Company Ltd. v. Sanjay Kumar & Ors., ILR (2007) 11 Delhi 733, wherein it was held as under:

MAC APP 565/2010 &567/2010 Page 4of[6] I been 'against said person. As knowledge is personal to theperson possessed ofthe knowledge, his absence at the trial would entitle the insurance company to a presumption against the owner.

24. That apart, what more can the insurance company do other than to serve a notice under Order 12 Rule 8 of the Code of Civil Procedure calling upon the owner as well as the driver to produce a valid driving licence. If during trial such a notice is served and proved to be served, non response by the owner and the driver would fortify the case ofthe insurance company. "

10. The Appellant therefore, has proved that there was willfull and conscious breach of the terms and conditions of the insurance policy. Although in view ofthe judgment ofthe Supreme Court in Sohan Lai Passi v. P. Sesh Reddy, (1996) 5 SCC 21; National Insurance Company Limited v. Swaran Singh & Ors., (2004) 3 SCC 297 and UnitedIndia Insurance Company Ltd. v. Lehru & Ors., (2003) 3 SCC 338, the Appellant was under obligation to satisfy third party liability, butatthe same time, the Appellant is entitled to recovery rights from the owner of the offending vehicle.

11. The appeals are hence, allowed and the Appellant Insurance Company shall be entitled to recover the amount of compensation paid along with interest and further interest @ 6% per annum from the date of payment till its relisation in execution of these very judgments without any recourse to MAC APP 565/2010 &567/2010 Page 5of[6] > IS j j independent proceedings for recovery.

12. The appeals are allowed in above terms.