Onus Is On Insurance Company To Prove That Insured Is Guilty Of Violating Terms & Conditions Of Insurance Policy: P&H HC Reaffirms

The Punjab and Haryana High Court has partly allowed an appeal filed by the claimant for modification of an award passed by the Motor Accident Claims Tribunal while also setting aside the finding of the Tribunal whereby the insurance company had been exonerated and the liability had been fastened upon the driver and owner of the vehicle.

The Single Judge Bench of Justice Sukhvinder Kaur observed that “As per settled proposition of law, it is for the insurance company to discharge the onus that the insured is guilty of violating the terms and conditions of the insurance policy, constituting a defence in favour of the insurer”.

Advocate Gaurav Khera appeared for the Appellant, whereas Advocate Neeraj Khanna appeared for the Respondent.

In a brief background of the case, the son of the Appellant/ Claimant (Bhateri) was employed as Helper on a light transport vehicle. On one day while going with the owner of the vehicle to Meham from Hansi, a truck being driven by its Driver/ Respondent at a high speed and in a rash and negligent manner, hit their vehicle. Resultantly, the Appellant's son & the owner sustained multiple grievous injuries and were taken to General Hospital Meham. The Appellant's son succumbed to his injuries. It was therefore pleaded that at the time of his death, he was 27 years old and was earning Rs.15,000 per month and mother was dependent upon him. In view of these averments, an amount of Rs 40 lakhs as compensation was claimed by the claimant from Respondents being driver, owner, and insurer of the offending vehicle.

After considering the submission, the Bench observed that the Tribunal had rightly observed that as no document had been placed on record that deceased son was getting Rs 15,000 per month by working as a Helper on the said vehicle, so income of the deceased for the purpose of determination of compensation was to be taken as minimum wages of an unskilled worker fixed by the State Government.

Thus, the Bench stated that the Tribunal had rightly taken the notional income of the deceased for the purpose of compensation as Rs.6,000 per month.

As per the ratio of law laid down by the Apex Court in National Insurance Company Limited Vs. Pranay Sethi [2017(4) RCR (Civil) 1009], the Bench said that the addition of 40% in the income of the deceased/ Sonu was required to be made by the Tribunal which had not been done.

The High Court also noticed that the Tribunal had committed an error while taking into consideration the age of the claimant/the mother of the deceased for choosing the multiplier.

In view of the fact that age of the deceased to be 27 years, the High Court observed that the multiplier of 17 was to be applied in the present case, to assess the total loss of dependency.

The Bench observed that from the evidence on record, it transpired that absolutely no evidence had been led by the insurance company to prove that driving license was fake and was not a genuine driving license.

As per the Bench, nothing was brought on record by the insurance company, in order to prove that license was fake and not valid, so as to result in violation of terms and conditions of the insurance policy.

Hence the Bench partly allowed the appeal and added that when it has not been proved that driving license was fake, then it cannot be said that terms and conditions of the insurance policy had been violated by Respondents.

Accordingly, the High Court held that the liability of all the Respondents to pay the compensation shall be joint and several and no recovery rights will be available to Respondent – Insurance company.

Cause Title: Bhateri and Ors v. Jaimal and Ors. [Neutral Citation: 2023: PHHC: 075847]

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