- 1 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 R IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE26H DAY OF JULY, 2023 BEFORE THE HON'BLE MR JUSTICE HANCHATE SANJEEVKUMAR MISCELLANEOUS FIRST APPEAL No.4502 OF2015(MV-D) C/W MISCELLANEOUS FIRST APPEAL No.4498 OF2015(MV-D) MISCELLANEOUS FIRST APPEAL No.4499 OF2015(MV-D) MISCELLANEOUS FIRST APPEAL No.4503 OF2015(MV-D) IN MFA NO45022015 BETWEEN: SRI. REVANAPPA M SINCE DECEASED BY HIS LRS SMT. SIDDAMMA S/O MARULASIDDAPPA, AGED ABOUT70YEARS PROPRIETOR - REPUBLIC MOTOR SERVICE, R/O OPP. TO FIRE FORCE OFFICE, DAVANAGERE-577 002 (AMENDED AS PER COURT
ORDER2404.2018) …APPELLANT (BY SRI. K.MANJUNATH, ADVOCATE) AND:
1. SRI. THIPPANNA @ THIPPESWAMY, SINCE DECEASED BY HIS LRS SMT. GANGAMMA THE2D RESPONDENT AGED ABOUT62YEARS R/O HIRE ARAKERE VILLAGE, - 2 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 DEVIKERE POST, JAGALUR TALUK, DAVANGERE DISTRICT, PIN – 577 528 2. SMT. GANGAMMA, W/O THIPPANNA @ THIPPESWAMY, AGED ABOUT50YEARS R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, DAVANAGERE DISTRICT-577 528 (AMENDED AS PER COURT
ORDERDATED22011.2022) 3. SRI. LOKESH O.H S/O HALAPPA. O AGE:MAJOR, R/O HALLADAKERI, B. DURGA, HOLALKERE TALUK, CHITRADURGA DISTRICT PIN – 577 526 4. THE MANAGER ORIENTAL INSURANCE CO. LTD., SRI SHARADA COMPLEX, 1ST FLOOR, OPP:TO K.S.R.T.C BUS STAND, P.B.ROAD, CHITRADURGA - 577 501 RESPONDENTS (BY SRI. HAREESH BHANDARY T, ADVOCATE FOR R2; SRI.B.S.UMESH ADVOCATE FOR R4; R3 IS SERVED; V/O DATED2211/2022, R2 IS TREATED AS LR’S OF DEED R1) - 3 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 THIS MFA IS FILED U/S1731) OF MV ACT AGAINST THE
JUDGMENTAND AWARD DATED3103.2015 PASSED IN MVC NO.299/2014 ON THE FILE OF THE3D ADDITIONAL SENIOR CIVIL JUDGE AND7H MACT, DAVANGERE, AWARDING THE COMPENSATION OF RS.2,25,000/- WITH INTEREST AT6 P.A. FROM THE DATE OF PETITION TILL THE DEPOSIT. IN MFA NO44982015 BETWEEN: SRI. REVANAPPA M SINCE DECEASED BY HIS LRS SMT. SIDDAMMA S/O MARULASIDDAPPA, AGED ABOUT70YEARS PROPRIETOR - REPUBLIC MOTOR SERVICE, R/O OPP. TO FIRE FORCE OFFICE, DAVANAGERE-577 002 (AMENDED AS PER COURT
ORDER0211.2022) …APPELLANT AND:
1. SRI. THIPPANNA @ THIPPESWAMY, SINCE DECEASED BY HIS LRS SMT. GANGAMMA THE2D RESPONDENT AGED ABOUT62YEARS R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, DAVANGERE DISTRICT, PIN – 577 528 2. SMT. GANGAMMA, W/O THIPPANNA @ THIPPESWAMY, AGED ABOUT50YEARS - 4 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, DAVANAGERE DISTRICT-577 528 (AMENDED AS PER COURT
ORDERDATED1712/2018) 3. SRI. LOKESH O.H S/O HALAPPA. O AGE:MAJOR, R/O HALLADAKERI, B. DURGA, HOLALKERE TALUK, CHITRADURGA DISTRICT PIN – 577 526 4. THE MANAGER ORIENTAL INSURANCE CO. LTD., SRI SHARADA COMPLEX, 1ST FLOOR, OPP:TO K.S.R.T.C BUS STAND, P.B.ROAD, CHITRADURGA - 577 501.
5. M.R.SHIVPRAKASH, S/O LATE REVANNAPPA, AGED ABOUT53YEARS, 6. M.R.SIDDESH, S/O LATE REVANAPPA, AGED ABOUT48YEARS, 7. M.R. DRAKSHYANI, D/O LATE M. REVANNA, AGED ABOUT50YEARS. …RESPONDENTS (BY SRI. HAREESH BHANDARY T, ADVOCATE FOR R2; SRI. B. S. UMESH, ADVOCATE FOR R4; SRI. ARVINDA GOWDA PATIL ADVOCATE FOR R5 TO R7 R3 IS SERVED; - 5 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 V/O DATED2211.2022 R2 IS TREATED AS LRS OF DECEASED R1) THIS MFA IS FILED U/S1731) OF MV ACT AGAINST THE
JUDGMENTAND AWARD DATED31.03.2015 PASSED IN MVC NO.296/2014 ON THE FILE OF THE3D ADDITIONAL, SENIOR CIVIL JUDGE AND7H MACT, DAVANGERE, AWARDING THE COMPENSATION OF RS.6,76,000/- WITH INTEREST AT6 P.A., FROM THE DATE OF PETITION TILL THE DEPOSIT. IN MFA NO44992015 BETWEEN: SRI. REVANAPPA M SINCE DECEASED BY HIS LRS SMT. SIDDAMMA S/O MARULASIDDAPPA, AGED ABOUT70YEARS PROPRIETOR - REPUBLIC MOTOR SERVICE, R/O OPP. TO FIRE FORCE OFFICE, DAVANAGERE-577 002 (AMENDED AS PER COURT
ORDER1904.2018) …APPELLANT (BY SRI.K.MANJUNATH, ADVOCATE) AND:
1. SRI. THIPPANNA @ THIPPESWAMY, SINCE DECEASED BY HIS LRS SMT. GANGAMMA THE2D RESPONDENT AGED ABOUT62YEARS R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, - 6 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 DAVANGERE DISTRICT, PIN – 577 528 2. SMT. GANGAMMA, W/O THIPPANNA @ THIPPESWAMY, AGED ABOUT50YEARS R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, DAVANAGERE DISTRICT-577 528 (AMENDED AS PER COURT
ORDERDATED2211.2022) 3. SRI. LOKESH O.H S/O HALAPPA. O AGE:MAJOR, R/O HALLADAKERI, B. DURGA, HOLALKERE TALUK, CHITRADURGA DISTRICT PIN – 577 526 4. THE MANAGER ORIENTAL INSURANCE CO. LTD., SRI SHARADA COMPLEX, 1ST FLOOR, OPP:TO K.S.R.T.C BUS STAND, P.B.ROAD, CHITRADURGA - 577 501. …RESPONDENTS (BY SRI. B S UMESH, ADVOCATE FOR R4; SRI.HAREESH BHANDARY. T, ADVOCATE FOR R2; R3 IS SERVED; V/O DATED2211/2022, R2 IS TREATED AS LR’S OF DECEASED R1) - 7 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 THIS MFA IS FILED U/S1731) OF MV ACT AGAINST THE
JUDGMENTAND AWARD DATED31.3.2015 PASSED IN MVC NO.298/2014 ON THE FILE OF THE III ADDITIONAL SENIOR CIVIL JUDGE, 7TH MACT, DAVANGERE, AWARDING A COMPENSATION OF RS.3,30,400/- WITH INTEREST @ 6% P.A FROM THE DATE OF PETITION TILL THE DATE OF REALIZATION. IN MFA NO45032015 BETWEEN: SRI. REVANAPPA M SINCE DECEASED BY HIS LRS SMT. SIDDAMMA S/O MARULASIDDAPPA, AGED ABOUT70YEARS PROPRIETOR - REPUBLIC MOTOR SERVICE, R/O OPP. TO FIRE FORCE OFFICE, DAVANAGERE-577 002 (AMENDED AS PER COURT
ORDER1904.2018) …APPELLANT (BY SRI. K. MANJUNATH, ADVOCATE) AND:
1. SRI. THIPPANNA @ THIPPESWAMY, SINCE DECEASED BY HIS LRS SMT. GANGAMMA THE2D RESPONDENT AGED ABOUT62YEARS R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, DAVANGERE DISTRICT, PIN – 577 528 2. SMT. GANGAMMA, W/O THIPPANNA @ - 8 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 THIPPESWAMY, AGED ABOUT50YEARS R/O HIRE ARAKERE VILLAGE, DEVIKERE POST, JAGALUR TALUK, DAVANAGERE DISTRICT-577 528 (AMENDED AS PER COURT
ORDERDATED2211.2022) 3. SRI. LOKESH O.H S/O HALAPPA. O AGE:MAJOR, R/O HALLADAKERI, B. DURGA, HOLALKERE TALUK, CHITRADURGA DISTRICT PIN – 577 526 4. THE MANAGER ORIENTAL INSURANCE CO. LTD., SRI SHARADA COMPLEX, 1ST FLOOR, OPP:TO K.S.R.T.C BUS STAND, P.B.ROAD, CHITRADURGA - 577 501. …RESPONDENTS (BY SRI. HAREESH BHANDARY.T ADVOCATE FOR R2; SRI. B. S. UMESH ADVOCATE FOR R4; R3 IS SERVED; V/O DATED2211/2022 R2 IS TREATED AS LR’S OF DECEASED R1) THIS MFA IS FILED U/S1731) OF MV ACT AGAINST THE
JUDGMENTAND AWARD DATED31.03.2015 PASSED IN MVC NO.297/2014 ON THE FILE OF THE III ADDITIONAL SENIOR CIVIL JUDGE AND VII MACT, DAVANGERE, AWARDING COMPENSATION OF RS.2,25,000/- WITH INTEREST @ 6% P.A FROM THE DATE OF PETITION TILL THE DATE OF REALIZATION.-. 9 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 THESE APPEALS, COMING ON FOR
ORDERS, THIS DAY, THE COURT DELIVERED THE FOLLOWING:
JUDGMENTAll the four appeals MFA No.4502/2015, 4498/2015, 4499/2015 and 4503/2015 are filed by the owner of the bus No.KA-17/B-7065, against the Judgment and Award dated 31.03.2015 in MVC Nos.299/2014, 296/2014, 298/2014 and 297/2014, respectively, passed by the III Addl. Senior Civil Judge and VII M.A.C.T, at Davanagere, questioning the liability fixed on the owner.
2. Brief facts of the case are that on 13.02.2014, while the deceased was going on his motor cycle No.KA-17/EC-2636 along with his wife and children as pillion riders, near Sibara village, the Respondent No.3-driver of the bus No.KA-17/B- 7065 came in a rash and negligent manner and dashed the motor cycle. As a result, all the four persons sustained grievous injuries and succumbed to the injuries. Four claim petitions were filed and compensation has been awarded in all - 10 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 the petitions and the driver and owner of the bus were held liable to pay the compensation jointly and severally.
3. Heard the learned counsel for both sides and perused the records. REGARDING PERMIT:
4. Learned counsel for the owner submitted that the bus No.KA-17/B-7065 was having permit for plying between the destinations Chitradurga-Davanagere via Mallappanahatti Chikkapura, Kyasapura, Kodagavalli, V.S.Halli, Chikkalaghatta, O.B.Halli, Sirigere Cross, Sirigere, Medikaripura, Sasaluhalla, Dandigehalli, Abbikere Gate, Santhebennuru, Thanigere, Bada, Attigere, Kurki, Turchaghatta, Davanagere and back. But on the day of the accident, the bus had plied on other than the above-mentioned route and met with an accident on Nijalingappa Tomb near National Highway, Shibira village, which is not covered in the permit. Therefore, on this ground, the Tribunal has exonerated the Insurance Company and saddled the liability on the appellant-owner and driver of the - 11 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 bus to pay compensation. Learned counsel further submitted that the matter is squarely covered by the Judgment of this Court in MFA No.2526/2018 connected with MFA No.5720/2018 dated 22.07.2022 - THE MANAGER, ORIENTAL INSURANCE COMPANY LIMITED vs. MELAPPA (for short ‘MELAPPA case’) and in the Judgment in MFA No.6604/2016 connected with MFA No.507/2016 dated 29.09.2022 - SRI.SANNABALAIAH vs. SMT.B.SUJATHA (for short ‘SANNABALAIAH case’). Therefore, submitted that mere deviation of the route permit and causing of the accident is not a ground to exonerate the Insurance Company and hence, prays to issue direction to the Insurance Company to indemnify the owner and pay compensation to the claimant.
5. On the other hand, learned counsel for the Insurance Company submitted the Company is not liable to indemnify the owner and this is correctly considered by the Tribunal. Therefore, prays for dismissal of the appeal filed by the owner. It is further submitted that in that particular area where - 12 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 accident had occurred, the bus was not having permit. Hence, it is amounting to the case of “no permit”. Hence, the Tribunal is correct in absolving the Insurance Company. Therefore, prays to dismiss the appeal filed by the owner.
6. Upon the similar facts and circumstances as involved in the case of accident occurring in deviated route, which means when deviation of route permit is taken and the accident had occurred, this Court in SANNABALAIAH’s case supra, after considering various Judgments of the Hon’ble Supreme Court and of this Court, has held as follows:
9. In this regard, the learned counsel places reliance on the judgment of this Court in the case of THE MANAGER, ORIENTAL INSURANCE COMPANY LTD., vs. MELAPPA AND OTHERS, in MFA Nos.2526/2018 c/w. MFA No.5720/2018, dated 22.07.2022, at para Nos.10, 11, 12, 13 and 14, which reads as follows: “10. Considering the submission of learned counsel for the Insurance Company that the accident was occurred in the place other than the permitted area and the Insurance Company is not liable to pay the compensation, the - 13 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 judgments of Hon’ble Apex Court and of this Court are to be considered. This Court in the case of M/s Hanuman Transport Co. Pvt. Ltd (stated supra) has held that plying a stage carriage on a road not covered by the route mentioned in the permit amounts only to a breach of condition of the permit and does not affect the purpose for which the stage permit was granted. The breach does not automatically invalidate the permit and make it ineffective in law. Therefore, the Insurance Company is liable to pay the compensation as the insurance policy was in existence.
11. Further in the case of SMT. LEELAVATHI (stated supra) dealing with the liability of Insurance Company by holding that the insurer cannot contend that place of starting journey was outside permit for the reason that the MV Act is beneficial legislation. Therefore, insurer’s contention in this regard cannot be accepted and the said submission is not tenable and accordingly, held that the Insurance Company is liable to satisfy the claim. The Division Bench of this Court in the case of SMT.REHANNA BEGUM (stated supra) also held by referring the earlier judgments of this Court and the Hon’ble Apex Court that just deviation of route cannot absolve the Insurance Company to satisfy the claim as it does not amount to fundamental statutory infraction and thus the Insurance Company cannot be absolved of its liability to pay the compensation. In the similar line, this Court in the cases of S.N.Kenchanna and Durgamma (stated supra) has held the same view. In both the - 14 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 judgments, the facts are that the accident had occurred in the place other than the permitted area. Although, because of the fact that the permit was in existence and just because, there was deviation in the route cannot absolve the Insurance Company from paying the compensation.
12. The learned counsel for the Insurance Company mainly relies on the decision of full bench of the Hon’ble Apex Court in Rani’s case (stated supra). In Rani’s case (stated supra), the facts are that the bus had got permit from the State of Maharashtra to ply within the boundaries of State of Maharashtra, but the bus plied in the State of Karnataka and met with an accident. For traveling in the State of Karnataka, there was no permit by the State of Karnataka or there was no endorsement on the permit given by the State of Maharashtra to ply on the roads of Karnataka State also. Under these facts and circumstances, the Hon’ble Apex Court has held that there was no permit to ply within the State of Karnataka. Hence, the order of pay and recovery was made absolving the Insurance Company to pay the compensation. But in the present case, the facts and circumstances are that the Tribunal in its judgment has observed that the Insurance Company itself has produced the permit of the bus bearing No.KA-18-8172 and according to which, route between Hosadurga to Hiriyuru is not covered, but permit was given to the bus to ply from Hosadurga to Holalkere, but the accident has taken place on the route between Hosadurga to Hiriyuru, which is 4 k.ms away from - 15 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 Hosadurga. Therefore, in the present case, the bus was having permit from the State of Karnataka, but there is deviation of route, in which place, the accident has occurred other than the permitted area. But in Rani’s case (stated supra) the facts and circumstances are that the bus was not having permit from the State of Karnataka to travel on the roads of Karnataka State and this makes difference in the facts and circumstances in Rani’s case (stated supra) and in the present case. In Rani’s case, even though, the bus was having permit from the State of Maharashtra only to travel on the roads of State of Maharashtra, but there was no permit either from the State of Karnataka or even endorsement on the permit issued by the State of Maharashtra to ply on the roads of State of Karnataka, which means the bus was not having permit at all to ply on the roads in the State of Karnataka. Therefore, in Rani’s case, the bus was not having permit at all by the State of Karnataka to travel on the roads in the State of Karnataka, which means that the bus was not having permit at all. Therefore, under these circumstances, an order of pay and recovery can be made. The Hon’ble Apex Court in the case of National Insurance Co., Ltd., Vs. Challa Bharathamma and Others reported in AIR2004SC4882has observed that the vehicle plied without having any permit is standing on a different pedestal than the vehicle which is having permit, which met with an accident in the area other than the permitted area, the same principle is applicable. Where there is no permit at all as in Rani’s case, the facts are revealed that an order of pay and recovery can be made.-. 16 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 Accordingly, it is made. But in the present case, bus bearing No.KA-18-8172 was having permit, but just because of deviation of route that does not fundamentally construe as an infraction so as to absolve the Insurance Company. Therefore, the principles laid down in the cases of M/s Hanuman Transport Company Limited, Smt.Leelavathi, Smt.Rehanna Begam, S.N.Kenchanna and Durugamma (stated supra) are squarely applicable to the case on hand.
13. Further the learned counsel for the Insurance Company submitted that by placing reliance on the judgment of the Division Bench of this Court in case of Dilip Vs. Nitin Jain and Others (stated supra) and in the present case, the facts are that the offending vehicle was plying outside the permitted area and even there is deviation of route, the Insurance Company is not liable to pay compensation, but an order of pay and recovery can be made and therefore, the learned counsel for the Insurance Company submitted to rely on this judgment. The said judgment was decided on 07.10.2020, but equal Co-ordinate Bench of this Court in Smt.Rehanna Begam’s case it is held that, even though, there is deviation of route, but it is not fundamental infraction so as to absolve the Insurance Company from its liability. Hence, there are two conflicting views between two Division Bench of this Court in Smt.Rehanna Begam’s case and it was decided on 27.07.2021, but the judgment in Dilip Vs. Nitin Jain and Others (stated supra) was delivered on 07.10.2020. Therefore, under these circumstances, if there is any - 17 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 conflict views between two Co-ordinate Benches then what is to be applied is stated by the Hon’ble Apex Court on the principles of law precedent. This Court in A.N.GANGADHARAPPA’s case (stated supra) by following the judgment of the Hon’ble Apex Court observed as follows: “14. In a situation when there is conflict between two decisions of the Supreme Court, whether it is the later of the two decisions or the decision of the larger of the Benches which rendered those decisions be followed by High Court and other Courts in the country, came up for consideration before a Full Bench of five Learned Judges of this Court in the case of GOVINDANAIK G. KALAGHATIGI vs. WEST PATENT PRESS CO.LTD. AND ANOTHER ((1976) 4 SCC52, and the said question was answered as follows: “5………If two decisions of the Supreme Court on a question of law cannot be reconciled and one of them is by larger Bench while other is by smaller Bench, the decision of larger Bench, whether it is earlier or later in point of time, should be followed by High Courts and other Courts. However, if both such Benches of the Supreme Court consist of equal number of Judges, the later of the two decisions should be followed by High Courts and others courts.” (emphasis supplied) 14. Therefore, it is now well settled that, if there are two conflicting judgments of the High Court having equal strength, then later judgment shall prevail over the earlier. Therefore, according to this principle, the judgment rendered in SMT.REHANNA BEGUM’s case - 18 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 (stated supra) is latest one compared to Dilip Vs. Nitin Jain and Others’s case (stated supra). Therefore, this Court has followed the principle laid down in SMT.REHANNA BEGUM’s case (stated supra). In the said case, it was held that mere deviation of route does not mean to fundamental infraction so as to absolve the Insurance Company from the responsibility of paying the compensation and the same is followed in the present case also for the reasons discussed above. Therefore, in the case on hand, it is proved that the bus bearing No.KA- 18-8172 having valid permits, but accident has occurred other than the permitted route. The permit route is between Hosadurga to Holalkere, but the bus was plied from Hosadurga to Hiriyuru and met with an accident 4 k.ms away from Hosadurga. Therefore, the place of accident is other than the permitted route. It is only the deviation of route and this deviation cannot be construed as fundamental infraction so as to avoid liability of the Insurance Company from paying the compensation. Therefore, the Insurance Company is responsible to satisfy the claim of the claimants as there was valid insurance policy between the Insurance Company and the owner of the bus as it is not disputed.
10. The above view is expressed by taking aid of the Division Bench judgment of this Court in the case of UNITED INDIA INSURANCE COMPANY LIMITED vs. SMT.SANDHYA W/O. TUKARAM PATIL AND OTHERS, passed in MFA No.1024428/2017. In the above stated case, the facts are that the driver had valid permit to ply within the - 19 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 territorial limits of Karnataka state, but the vehicle met with an accident at the place beyond territorial limits of Karnataka State. On this factual matrix, it was considered where the insurance company can be exonerated at para- 17 and 18 of the judgment which reads as follows:
17. It is held in Durugamma’s case stated supra that, “there are different kinds of contravention of the permit, one of which is relating to the route on which or the area in which the vehicle may be used. The purpose for which the vehicle may be used is distinguishable from the terms and conditions of the permit. At last, the route on which or the area in which the vehicle may be used, is one of the terms and conditions of the permit. But the same cannot be construed as the purpose for which the vehicle was to be used. Making the distinction, the learned Single Judge of this Court rightly came to the conclusion that the terms and conditions attached to each type of permit cannot be construed as a purpose of the permit. The purpose and the terms and conditions are two different aspects.” Therefore, the learned Single Judge interpreted that the legislature in its wisdom has restricted the defence that are available to the insurer under Section 149(2)(a)(i)(c) of the Act for a purpose and it is not allowed by the permit and not for violation of any terms and conditions of the permit. For example, if a vehicle has a goods carriage permit - 20 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 but has carried passengers or vice versa, then it can be held that the offending vehicle goods carriage permit is being used for a purpose not allowed by the permit.
18. There, the sole distinction on which the authorities relied on by the learned counsel for the appellant can be distinguished is on the ground that whether there was any violation of the purpose for which the vehicle was to be used and whether the violation of exceeding the territorial jurisdiction granted on the ground to ply the vehicle would amount to violation of purpose for which the vehicle was to be used. If that distinction is understood and kept in mind, we find that whether the Insurance Company can absolve its liability on the ground that the vehicle in question has plied beyond the territorial limits granted under the permit and therefore there is no permit for the vehicle can be decided. Further, the Insurance Company cannot contend that its liability is absolved on the ground that the purpose for which the vehicle was to be used, is violated. Because in this case the sole ground taken is violation of permit condition.
11. The judgment relied on by the learned counsel for the insurance company in the case of UNITED INDIA INSURANCE COMPANY LIMITED vs. SMT.SANDHYA W/O.-. 21 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 TUKARAM PATIL AND OTHERS supra, is not applicable in this case because of difference in facts and circumstances for the reason that the said judgment was delivered by following the law laid down by the Hon’ble Apex Court in the case of NATIONAL INSURANCE CO. LTD VS CHELLA BHARATHAMMA & ORS. 2008 (1) SCC423 The factual matrix involved of CHELLABHARATAMMA’s case was that the offending vehicle was not having any permit at all therefore the insurance company was exonerated, but was directed to pay and recovery. In the said case of CHELLABHARATAMMA as discussed above, the distinction is made between the aspects the vehicle having permit on one route and the said vehicle met with an accident while plying in another route and the vehicle which is not at all having any permit. These two aspects which are different, but in CHELLABHARATAMMA’s case the facts are that the offending vehicle was not having any permit. Therefore, the insurance company was exonerated. This makes the difference in the present case and in the above cited case. But the Division Bench of this court in the above cited case of SMT. REHANA BEGUM and in the case of SMT.SANDHYA has - 22 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 categorically held that the insurance company is liable, on the facts as involved in the case therein. Furthermore, the judgment delivered in the SANDHYA’s case as referred to supra was not brought before the Division Bench of this Court in the case of SRI.VENKATESH vs. IFFCO TOKIO GEN-INSURANCE AND OTHERS, passed in MFA No.967/2017, dated 22.04.2022. In case of SANDHYA’s as referred to supra, the Division Bench of this Court has laid down the principle of law by applying the relevant legal provisions enumerated in the Motor Vehicles Act. Therefore, the judgment in VENKATESH’s case stated supra is not applicable to the insurance company’s case.
12. The learned counsel for the insurance company has relied on the judgment of the Hon’ble Apex Court in the case of AMRUTH PAL SINGH’s case. But this judgment is not applicable in the present case because of difference in factual matrix in the above stated case and in the present case. In the case of Amruth Pal Singh’s case, the accident was caused on 19.02.2013 but the permit was renewed w.e.f. 27.12.2013. Therefore, as on the date of the accident there was no permit. Under these factual matrix involved, the Hon’ble - 23 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 Supreme Court held that since as on the date of the accident there is no permit and subsequently, the permit was renewed therefore construed as on the date of the accident it amounting to no permit. Therefore, on this factual matrix it was held that the insurance company was not liable to indemnify the owner by making the payment of compensation.
15. Section-66 of the M.V. Act stipulates as follows: “66. Necessity for Permits : (1) No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorizing him the use of the vehicle in that place in the manner in which the vehicle is being used:
16. Section-149(2)(a)(i)(c) of the MV Act reads as follows: (2) No sum shall be payable by an insurer under sub- section (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given the insurer had notice through the Court or, as the case may be, the Claims Tribunal of the bringing of the - 24 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 proceedings, or in respect of such judgment or award so long as execution is stayed thereon pending an appeal; and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely:— (a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:— (i) a condition excluding the use of the vehicle— (a) xxx (b) xxx (c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or
17. Therefore, in this background applying the principle of law laid down as above stated, if there is any deviation in plying the vehicle other than the permit route, it does not amount to infraction. It is just only a deviation of route where the accident has occurred. Therefore, it cannot be said that the bus was not at all having any permit. Mere deviation of the route is not an absolute breach of the policy so as to absolve the insurance company from its liability. Furthermore, the defence raised in this - 25 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 appeal by the learned counsel for insurance company is not applicable as per Section- 149(a)(2)(i)(c) of the M.V. Act, if the vehicle is used for other purpose which the permit is granted, such option is available to the insurance company. Here the purpose for which the vehicle was used is a matter for consideration. Therefore, the said violation as contended by the insurance company is not available under Section-149(2) of the M.V.Act as contended as it amounts to breach of condition of permit policy. The Bus was used for the purpose of carrying passengers and not for any other purpose. The bus was used for the same purpose for which the permit was granted but on different route. Therefore, the defence raised by the insurance company is not available. As per the legal provisions above discussed, if the bus was used for any other purpose then the contention of the insurance company may be correct. But this is not the case herein. The purpose for which the permit was given was for carrying passengers. Therefore, just because there is a deviation of route, but at that time the bus was having permit. It is not amounting to absolute infraction so as to absolve the insurance company on this ground. Therefore, I do not find any merit in the - 26 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 contention urged by the learned counsel for the insurance company. Therefore, in this regard the judgment and award passed by the Tribunal in fastening the liability on the owner is liable to be set-aside and the same is fastened on the insurance company. In MELAPPA’s case supra also, the same view was taken by this Court.
7. In the present case, the only allegation of the Insurance Company is that the accident had occurred on the route other than the permitted area, which means there is a deviation of route. As per Section 149(2)(a)(1)(c) of the Motor Vehicles Act, where a transport vehicle is allowed to be used other than the purpose for which permission is given, for attracting this clause, there should be a deviation of purpose, but not the route. Here the bus is used for the same purpose for carrying passengers. The only deviation occurred is route, but not the purpose in the present case. Therefore, there is no fundamental infraction so as to absolve the Insurance Company by indemnifying the appellant-owner. Hence, as per - 27 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 principle of law laid down by this Court in MELAPPA and SANNABALAIAH cases supra, the Insurance Company shall indemnify the owner and pay compensation to the claimant. Therefore, the Judgment and Award passed by the Tribunal is liable to be modified.
8. Hence, I proceed to pass the following:
ORDERi) MFA No.4502/2015, 4498/2015, 4499/2015 and 4503/2015 filed by the owner are allowed. ii) The Judgment and Award dated 31.03.2015 in MVC Nos.299/2014, 296/2014, 298/2014 and 297/2014 passed by the III Addl. Senior Civil Judge and VII M.A.C.T, at Davanagere, are modified to the extent that the Insurance Company shall indemnify the owner of the bus No.KA-17/B-7065 and pay compensation to the claimants.-. 28 - NC:
2023. KHC:26296 MFA No.4502 of 2015 C/W MFA No.4498 of 2015 MFA No.4499 of 2015 MFA No.4503 of 2015 iii) The liability saddled on the appellant- owner is hereby set aside. iv) No order as to costs. v) Draw award accordingly. vi) Amount in deposit shall be refunded to the appellant-owner. Sd/- JUDGE BNV List No.:
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