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Tuesday, April 8, 2014

Accident claim - Sec.103 and 157 of M.V. Act - Transfer of ownership - mere failure to intimate the same to the insurance company under sec. 103 of M.V. Act , does not exempt the insurance company from liability to pay compensation to the victim - Apex court held that we are of the considered view that as on the date of accident, the deceased workman was in the course of employment of Jeeva Rathna Setty in whose name the ownership of the vehicle stood transferred and the said vehicle was covered under a valid insurance policy, the High Court ought not have simply brushed aside the decision of the Commissioner fastening joint liability on the Insurance Company in the light of the deeming provision contained in Section 157 (1) of the M.V. Act. For the foregoing reasons, we allow this appeal, set aside the impugned judgment passed by the High Court and restore the judgment of the trial Court.= MALLAMMA (DEAD) BY L.Rs. … APPELLANT(S) VERSUS NATIONAL INSURANCE CO. LTD. & ORS. … RESPONDENTS = 2014 ( April. Part ) http://judis.nic.in/supremecourt/filename=41395

Accident claim - Sec.103 and 157 of M.V. Act - Transfer of ownership - mere failure to intimate the same to the insurance company under sec. 103 of M.V. Act , does not exempt the insurance company from liability to pay compensation to the victim - Apex court held that we are of the  considered  view  that as on the date of accident, the  deceased  workman  was  in  the  course  of employment of Jeeva Rathna Setty in whose name the ownership of the  vehicle stood transferred  and the said vehicle was covered under a valid  insurance policy, the High Court ought not have simply brushed aside the  decision  of the Commissioner fastening joint liability on the Insurance Company  in  the light of the deeming provision contained in Section  157  (1)  of  the  M.V. Act.    For the foregoing reasons, we  allow  this  appeal,  set  aside  the impugned judgment passed by the High Court and restore the judgment  of  the trial Court.=

Transfer of ownership
Once  the
      ownership of the vehicle is admittedly proved to have been transferred
      to Jeeva Rathna Setty, the existing insurance policy in respect of the
      same vehicle will also be deemed to have been transferred to  the  new
      owner and the policy will not lapse even if the intimation as required
      under Section 103 of the M.V. Act is not given to the  insurer,  hence
      the impugned order passed by the High Court is  contrary  to  law. 

 The counsel for the Insurance Company of course contended  that  as  per
 their records, on the date of accident, the vehicle was registered  in  the
 name of Gangadhara. Hence  in  the  absence  of  a  valid  proof  that  the
 ownership of the vehicle has been transferred in the name  of  Jeeva  Ratna
 Setty, the benefits of insurance policy cannot  be  given  to  Jeeva  Ratna
 Setty. However,  the said contention is  contrary  to  record.  A  specific
 finding by the  Commissioner  to  this  effect  in  his  order  dated  28th
 February, 2003 reads thus:
      “The 4th respondent had stated that on the date of the accident,  this
      vehicle was in the name of Sh. Gangadhara.  But  the  applicants  have
      proved the said statement as false through documents and on  the  date
      of the accident, the vehicle was in the name of the Respondent No.1.”


14.   In view of the above finding, it can be discerned that on the date  of
accident, the ownership of the tractor stood transferred from Gangadhara  to
Jeeva Ratna Setty. In addition to  that,  a  perusal  of  the  ‘Schedule  of
Premium’ extracted above shows that an amount of Rs.15-00 has been  paid  as
premium “for L.L. to persons  employed  in  connection  with  the  operation
and/or loading of vehicle (IMT 19)”.
15.    In view of the above discussion we are of the  considered  view  that
as on the date of accident, the  deceased  workman  was  in  the  course  of
employment of Jeeva Rathna Setty in whose name the ownership of the  vehicle
stood transferred  and the said vehicle was covered under a valid  insurance
policy, the High Court ought not have simply brushed aside the  decision  of
the Commissioner fastening joint liability on the Insurance Company  in  the
light of the deeming provision contained in Section  157  (1)  of  the  M.V.
Act.
16.     For the foregoing reasons, we  allow  this  appeal,  set  aside  the
impugned judgment passed by the High Court and restore the judgment  of  the
trial Court.
2014 ( April. Part ) http://judis.nic.in/supremecourt/filename=41395
P SATHASIVAM, S.A. BOBDE, N.V. RAMANA
                                                                 REPORTABLE


                        IN THE SUPREME COURT OF INDIA
                        CIVIL APPELLATE JURISDICTION

                        CIVIL APPEAL NO. 1391 OF 2009


MALLAMMA (DEAD) BY L.Rs.                …    APPELLANT(S)

VERSUS

NATIONAL INSURANCE CO. LTD. & ORS.      …    RESPONDENTS


                                  JUDGMENT

N.V. RAMANA, J.


   1. This appeal by special leave is directed against the impugned judgment
      and order dated  10th  August,  2005  passed  by  the  High  Court  of
      Karnataka in M.F.A. No. 3842 of 2003 whereby  the  High  Court  partly
      allowed  the  appeal  preferred  by  the  Respondent  No.   1—National
      Insurance Company discharging it from  the  liability  of  payment  of
      compensation to the claimants— Appellants.
   2. The brief facts of the case leading to this appeal  are  that  on  3rd
      April, 1997 at about 1.00 p.m., when Honniah  @  Dodda  Thimmaiah  was
      returning from the field driving a tractor with the sand load  on  the
      trailor, the tractor overturned and Honnaih  @  Dodda  Thimmaiah  died
      owing to the injuries sustained in the  accident.   Appellants  herein
      are the claimants—legal representatives  of  the  deceased  Honniah  @
      Dodda  Thimmaiah.  The  tractor  involved  in  the  accident  had  the
      registration number KA  18/717-718  and  the  tractor  was  originally
      registered in the name of one Gangadhara (Respondent No.  3)  and  the
      same was insured with the Respondent No.  1  while  the  deceased  was
      employed as a driver with the Respondent No. 2-Jeeva Rathna Setty.
   3. On 4th September, 1997, the legal  representatives  of  the  deceased,
      filed  an  application   before   the   Commissioner   for   Workman’s
      Compensation,  Chickmagalur   (hereinafter   referred   to   as   “the
      Commissioner”) claiming compensation under the Workmen’s  Compensation
      Act.
   4. The Commissioner while issuing notices to the respondents  called  for
      filing of objections, if any. The respondents filed objections denying
      their liability to pay compensation. The  National  Insurance  Company
      (Respondent No. 1) deposed before the Commissioner that   as  per  its
      records on the date of accident, the vehicle was no  doubt  under  the
      insurance policy but  in the name of Gangadhara,  not in the  name  of
      Jeeva Ratna Setty, hence there is  no  relation  of  employee-employer
      between the deceased and Gangadhara and therefore, it has no burden of
      liability to pay compensation to the claimants.
   5. After hearing parties and perusing the documents  brought  on  record,
      the Commissioner came to the conclusion that the deceased was employed
      with  Jeeva  Rathna  Setty,  hence  there  is   an   employee-employer
      relationship between the deceased and the Respondent  No.  1  and  the
      deceased had died during the course of his employment. At the time  of
      accident, the age of the deceased was determined as 25  years  with  a
      monthly  earning  capacity  of  Rs.2,000/-  p.m.   and   thereby   the
      Commissioner fixed compensation at  Rs.2,16,910/-.  As  the  Insurance
      Company did not  deposit  the  amount,  the  Commissioner  awarded  an
      interest @ 12% p.a. from 3rd April 1997 till  the  date  on  which  he
      passed  the  order,  i.e.  14th  February,  2003,  which  amounted  to
      Rs.1,50,265/- and ordered that the appellants are entitled to  receive
      a total compensation of Rs.3,67,275/- from the  employer  Jeeva  Ratna
      Setty and the Insurance Company. Finally,  by  the  Award  dated  28th
      February, 2003, the  Commissioner  held  that   though  the  insurance
      policy was in the name of  Gangadhara, the ownership of the vehicle on
      the date of accident was with the Jeevaratna Setty; it is proved  that
      during the validity period of the  said  insurance  policy,  the  said
      vehicle was transferred from Gangadhara to Jeevaratna  Setty;  as  per
      Section 157(1) of the Motor Vehicles Act, 1968 whenever a  vehicle  is
      transferred from one person to another, the benefits of the  insurance
      policy shall also be transferred to the new owner; accordingly instant
      policy benefits will also be automatically transferred from Gangadhara
      to Jeevaratna Setty. Therefore, the National Insurance  Company  shall
      be liable to pay  the  compensation  and  interest  thereupon  to  the
      claimants. Accordingly, the Commissioner fixed the liability of paying
      compensation  on  the  Insurance  Company  and   Jeeva   Ratna   Setty
      individually and severally and directed them  to  deposit  the  amount
      within a period of 30 days from the date of the  Award  failing  which
      they shall further be liable to pay interest @ 9% p.a. for the delayed
      period. The Commissioner, however, discharged  Gangadhara  (Respondent
      No. 3) and Laxmana Bhovi, (Respondent No. 4) from the case.
   6. Aggrieved by the said order of the learned Commissioner, the Insurance
      Company (Respondent No. 1) filed M.F.A. No. 3842 of  2003  before  the
      High Court of Karnataka urging  that  no  liability  could  have  been
      fastened by the Commissioner on the Insurance Company.
   7. The High Court, by the impugned order, affirmed the  findings  of  the
      Commissioner that (i) the deceased workman was actually employed  with
      Jeeva Rathna Shetty, and therefore, there is a relation  of  employee-
      employer between them;  (ii) the deceased workman  having  died  as  a
      result of an accident arising out of and in the course of  employment,
      hence the claimants as  legal  representatives  of  the  deceased  are
      entitled to recover compensation, (iii) there was  a  valid  insurance
      policy in force on the date of accident (iv) and the original owner of
      the tractor was Gangadhara.  However,  the  High  Court  excluded  the
      liability of the Insurance Company on the ground that  the  contention
      of deemed transfer of the insurance policy in favour of  Jeeva  Rathna
      Setty by virtue of Section 157 of M.V.  Act  was  not  actually  urged
      before the Commissioner.
   8. Against the Judgment of the High Court relieving the Insurance Company
      from the liability of  payment  of  compensation,  the  claimants  are
      before this Court in this appeal.
   9. We have heard learned counsel for the parties and perused the material
      on record.
  10. Before us, learned counsel for the appellants relying upon Section 157
      of the M.V. Act, contended that  there  is  an  admitted  transfer  of
      ownership of the vehicle as proved before the Commissioner.  Once  the
      ownership of the vehicle is admittedly proved to have been transferred
      to Jeeva Rathna Setty, the existing insurance policy in respect of the
      same vehicle will also be deemed to have been transferred to  the  new
      owner and the policy will not lapse even if the intimation as required
      under Section 103 of the M.V. Act is not given to the  insurer,  hence
      the impugned order passed by the High Court is  contrary  to  law.  In
      support of this contention, learned  counsel  for  the  appellant  has
      relied upon a judgment of this Court in  G.  Govindan  Vs.  New  India
      Assurance Co. Ltd. (1999) 3 SCC 754.
  11.  Learned counsel has also brought to our  notice  a  relevant  portion
      from the ‘Schedule of Premium’ of the  insurance  policy,  a  copy  of
      which is available on record as Annexure P-1., which reads thus:
|B.   |LIABILITY TO PUBLIC RISK           |Rs. 120-00    |
|     |Liability to Trailor               |Rs.   87-00   |
|     |                                   |              |
|Add: |for L.L. to persons employed in    |Rs.  15-00    |
|     |Connection with the operation and/ |              |
|     |or loading of vehicle (IMT 19)     |              |
|     |                                   |              |
|     |                                   |              |
|Add: |for increased third party property |Rs.  75-00    |
|     |damage limits. Section II-I(ii)    |              |
|     |upto Rs. Unltd. IMT 70             |              |
|     |                                   |              |
|     |TOTAL PREMIUM (A +B)               |Rs. 1318-00   |


  12. On the other hand, learned counsel for the National Insurance Company,
      mainly contended that unless  it  is  proved  by  evidence   that  the
      vehicle has been transferred in the name of Jeeva  Rathna  Setty,  the
      deeming provision of  Section  157  of  the  M.V.  Act  would  not  be
      applicable.  In the absence of such evidence on record the High  Court
      has rightly absolved the Insurance Company from the liability and  the
      order passed by the High Court does not require any interference  from
      this Court.
13. The counsel for the Insurance Company of course contended  that  as  per
 their records, on the date of accident, the vehicle was registered  in  the
 name of Gangadhara. Hence  in  the  absence  of  a  valid  proof  that  the
 ownership of the vehicle has been transferred in the name  of  Jeeva  Ratna
 Setty, the benefits of insurance policy cannot  be  given  to  Jeeva  Ratna
 Setty. However,  the said contention is  contrary  to  record.  A  specific
 finding by the  Commissioner  to  this  effect  in  his  order  dated  28th
 February, 2003 reads thus:
      “The 4th respondent had stated that on the date of the accident,  this
      vehicle was in the name of Sh. Gangadhara.  But  the  applicants  have
      proved the said statement as false through documents and on  the  date
      of the accident, the vehicle was in the name of the Respondent No.1.”


14.   In view of the above finding, it can be discerned that on the date  of
accident, the ownership of the tractor stood transferred from Gangadhara  to
Jeeva Ratna Setty. In addition to  that,  a  perusal  of  the  ‘Schedule  of
Premium’ extracted above shows that an amount of Rs.15-00 has been  paid  as
premium “for L.L. to persons  employed  in  connection  with  the  operation
and/or loading of vehicle (IMT 19)”.
15.    In view of the above discussion we are of the  considered  view  that
as on the date of accident, the  deceased  workman  was  in  the  course  of
employment of Jeeva Rathna Setty in whose name the ownership of the  vehicle
stood transferred  and the said vehicle was covered under a valid  insurance
policy, the High Court ought not have simply brushed aside the  decision  of
the Commissioner fastening joint liability on the Insurance Company  in  the
light of the deeming provision contained in Section  157  (1)  of  the  M.V.
Act.
16.     For the foregoing reasons, we  allow  this  appeal,  set  aside  the
impugned judgment passed by the High Court and restore the judgment  of  the
trial Court.
17.     There shall, however, be no order as to costs.

                            …………………………………………CJI.
                            (P. SATHASIVAM)


                            ……………………………………………J.
                            (S.A. BOBDE)


                            ……………………………………………J.
                            (N.V. RAMANA)
 NEW DELHI,
APRIL 07, 2014

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