THE ORIENTAL INSURANCE CO LTD vs N.NATARAJ -died

CMA No. 1073 of 2020
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 31-08-2026
CORAM
THE HON'BLE MR.JUSTICE M.JOTHIRAMAN
CMA No. 1073 of 2020
AND
CMP NO. 6825 OF 2020
The Oriental Insurance Co Ltd
Rep.By Its Branch Manager, R.V.K.Building,
First Floor, No.54, Dhali Road,
Udumalpet.
..Appellant(s)
Vs
1. N.Nataraj -died
1/81, Kulathupalayampudur, Pollachi Tk,
Kovai Dt.
2. S.T.Nagaraj
S/o.Thngaraj, No.5/20-a, M.G.R.Nagar,
Upper Road, Pollachi.
3. S.Samuel Rajkumar
S/o.Selvaraj, No.5/2484, Ananda Kiri,
Kodaikanal.
4. Rathinam
1/81, Kulathupalayampudur, Devanainpalayam,
Kinathukadavu, Pollachi Taluk,
Coimbatore District.
5. Kanagaraj
1/81, Kulathupalayampudur, Devanainpalayam,
Kinathukadavu, Pollachi Taluk,
Coimbatore District.
6. Mayilsamy
1/81, Kulathupalayampudur, Devanainpalayam,
Kinathukadavu, Pollachi Taluk,
=Coimbatore District.
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CMA No. 1073 of 2020
7. Rajalakshmi
1/81, Kulathupalayampudur, Devanainpalayam,
Kinathukadavu, Pollachi Taluk,
Coimbatore District.
8. Senthilkumar
1/81, Kulathupalayampudur, Devanainpalayam,
Kinathukadavu, Pollachi Taluk,
Coimbatore District
9. Radhamani
1/81, Kulathupalayampudur, Devanainpalayam,
Kinathukadavu, Pollachi Taluk,
Coimbatore District.
(R1 died, RR 4 to 9 B/R as LRs of the deceased
R1 vide court order dt 17/04/2026 Made in
CMPs 28254, 28258, 28259/2024 - KBJ)
..Respondent(s)
Prayer: Civil Miscellaneous Appeal filed under Section 173 of the Motor
Vehicles Act, 1988 to set aside the judgment and decree passed by the tribunal
in the above M.C.O.P.No.105 of 2014 on the file of the Motor Accidents Claims
Tribunal (Subordinate Judge) at Pollachi dated 24.07.2019.
For Appellant(s): Mr.M.Krishnamoorthy
For Respondent(s): R1 - Died (Steps Taken)
R2 - Exparte
R-3 to R9 – No Appearance
JUDGMENT
Unsuccessful Insurance Company has preferred this Civil Miscellaneous
Appeal, challenging the quantum of compensation awarded by the Tribunal,
vide award dated 24.07.2019 in M.C.O.P.No.105 of 2014 on the file of the
Motor Accidents Claims Tribunal (Subordinate Judge) at Pollachi.
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CMA No. 1073 of 2020
2. According to the claimants, on 24.01.2010, the claimant along with 3
persons were travelling in a Maruti 800 Car bearing Reg.No.TN 38 5505, which
st nd
was driven by the 1 respondent driver therein / 2 respondent herein, namely
S.T.Nagaraj. While so at about 5.40 pm., when the said car was nearing
Reliance Petrol Bunk at Udumalpet to Pollachi Main Road proceeding from
st
East to West direction, the 1 respondent therein driven the car in a rash and
negligent manner and he had overtaken the vehicle and at that time, he had lost
control and dashed upon a TATA Ace vehicle bearing Reg.No.TN 38 AQ 9826,
which came in the opposite direction. Due to the accident, the claimants and 3
other persons, who had travelled in the Maruti 800 car bearing Reg.No.TN 38
5505, had sustained multiple grievous injuries all over the body. According to
the claimants, the accident occurred only due to the rash and negligent driving
st st
of the 1 respondent/ driver and the said accident was occurred when the 1
nd
respondent was in the course of employment of the 2 respondent / owner of the
rd
vehicle. 3 respondent therein was the insurer of the Maruti 800 belonging to
nd
the 2 respondent.
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3. The appellant Insurance Company / 3 respondent therein had filed a
counter statement wherein they denied all the allegations levelled in the claim
nd
petition. It is true that the 2 respondent / owner / Samuel Raj has insured the
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car being Reg.No.TN 38 5505 with the 3 respondent therein / Insurance
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CMA No. 1073 of 2020
Company subject to the terms, conditions and limitations thereof. The policy
rd
issued by the appellant / 3 respondent therein is “Act Only Cover policy” and
the occupant of the car, namely the claimant is not covered in Act Policy issued
by the appellant Insurance Company. Since the policy issued does not covered
the passengers of the car, the appellant Insurance Company is not liable to pay
compensation to the claimant. Since the accident took place due to the rash and
st
negligent driving of the driver of the car / 1 respondent therein, the claim
petition is liable to be dismissed.
4. Before the Tribunal, on behalf of the claimant, the claimant examined
himself as PW1 and Exs.P1 to P6 were marked. On behalf of the respondents,
one Tmt.Amirdha was examined as RW1 and marked Ex.R1.
5. Upon appreciation of evidence adduced on either side, the Tribunal
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opined that due to the rash and negligent driving of the 1 respondent therein,
nd
the accident had occurred and the owner of the vehicle / 2 respondent therein
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has permitted the 1 respondent driver to drive the vehicle without any driving
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licence. The claimant was a 3 party and the insurer has to indemnify the
insured and therefore, directed the Insurance Company to pay compensation and
recover the same from the owner and driver of the vehicle. The Tribunal,
considering the disability assessed by the Medical Board in Ex.P6 at 30%,
awarded a sum of Rs.3,000/- for each percentage of disability and also awarded
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CMA No. 1073 of 2020
compensation under various other heads, in total a sum of Rs.1,20,000/- was
arrived and ordered the appellant Insurance Company to pay the same and
st nd
thereafter to recover the same from the 1 respondent / driver and 2 respondent
/ owner of the vehicle. Being aggrieved over the same, the Insurance
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Company / 3 respondent therein has preferred the present appeal.
6. The learned counsel appearing for the appellant would submit that the
Tribunal committed an error and the vehicle involved in the accident was
insured under Liability only policy, which covers the risk of third parties and
not covering the risk of the claimant / first respondent, a passenger in the
insured car. The Tribunal overlooked the evidence of RW1, the Assistant
Manager of the appellant and the copy of the policy produced by him under
Ex.R1, which proved that the car in which the claimant was travelling was
insured with the appellant was insured under Liability only policy covering the
risk of third parties only. The Tribunal ought to have exonerated the appellant
as per Ex.R1, which is only a liability only policy and did not cover the
occupants of the car as held in NIA v. S.Krishnasamy & Ors. [2015 (1)
TNMAC 19] and NIC v. K.Rajasekaran & Ors.[2017 (2) TNMAC 253].
7. Despite notice served to the driver and owner of the vehicle, none
appeared either in person or through counsel.
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CMA No. 1073 of 2020
8. This Court considered the submissions made by the learned counsel for
the appellant and also perused the materials available on record.
9. According to the claimants, on 24.01.2010, claimant along with 3
persons were travelling in a Maruti Car bearing Reg.No.TN 38 5505 which was
st
driven by the 1 respondent therein / driver in a rash and negligent manner and
dashed against TATA Ace vehicle, which came in the opposite direction. Due
to the accident, the claimant and 3 persons, who travelled in the Maruti Car had
st
sustained multiple injuries all over the body. According to the claimants, the 1
nd
respondent therein drove the vehicle in the course of employment under the 2
nd
respondent / owner of the vehicle. The 2 respondent therein has insured the
car with the appellant herein.
10. A perusal of Ex.R1 – Insurance Policy issued by the appellant herein
nd
shows that the 2 respondent therein is the owner of the Maruti 800 bearing
Reg.No.TN 38 5505. It is seen from Ex.R1 – Insurance Policy that there are
certain limitations as to use and the policy covers use of the vehicle for any
purpose other than (a) hire or reward, (b) carriage of goods (other than samples
or personal luggage) (c) organised racing (d) pace making (e) speed testing (f)
reliability trials (g) use in connection with Motor Trade. In the case on hand,
according to the claimant, the claimant and three persons have travelled in the
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CMA No. 1073 of 2020
st
car which was driven by the 1 respondent therein, but drove the same in a rash
and negligent manner and dashed against the TATA Ace, which came in the
opposite direction. A perusal of Ex.R1- Insurance Policy reveals that the
vehicle which was involved in the accident was insured under Act Only /
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Liability only policy which covers the risk of 3 parties only and not covers the
risk of claimants, who are passengers in the insured car.
11. At this juncture, it is relevant to refer the judgment of the Hon’ble
Division Bench of this Court in New India Assurance Co. Ltd. v.
S.Krishnasamy and others [2015 (1) TNMAC 19 (DB), wherein it has been
held as under:
“18. In view of the rulings cited above, we are of the
considered view that since, the Policy is only an Act Policy issued
by the Appellant – Insurance Company to the Insurer and the
deceased Palanisamy was only an occupant of the Private Car,
cannot be considered as ‘Third party’ of the vehicle and the policy
is covered risks to the third party alone. Hence, the deceased was
0only the occupant of the Private Car and the said Policy will not
cover the risk of the deceased. The Doctrine of Pay and Recovery
cannot be applied to the facts of the case, since the Appellant –
Insurance Company is not liable to pay the Compensation. Hence,
pay amount to the Claimants and then recover the same from the
owner of the vehicle involved in the accident cannot be ordered and
in view of the above, the ruling cited on the side of the Respondents
1 to 5 / Claimants are not applicable to the facts of the present case.
19. Hence, we are of the considered view that since the Act
Policy did not cover the risk, the Insurance Company is not liable to
pay any Compensation to the Claimants / dependents of the
deceased and the owner of the vehicle alone is liable to pay
damages to the claimants, as the accident occurred due to rash and
negligent act of the driver of the vehicle.
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CMA No. 1073 of 2020
20. In the result, this Appeal is partly allowed and the
Insurance Company is not liable to pay any amount to the
Claimants. If any amount is paid by the Insurance Company to the
Claimants, the Insurance Company is entitled to get back the
same…..”
12. By applying the ratio laid down in the aforesaid judgment, in the case
on hand, Ex.R1- Insurance policy is only a Act / Liability policy and did not
cover the risk of occupants of the car and further Ex.R1 proved that the car in
which the claimant was travelling was insured with the appellant covers the risk
rd
of 3 parties only and in such circumstances, the Tribunal ought to have
exonerated the appellant. The Tribunal erred in overlooking the evidence of
RW1 and Ex.R1, which proved that the car in which the claimant was travelling
insured with the appellant was insured under Act only / Liability only policy
rd
covering the risk of 3 parties only and has erroneously granted the relief of Pay
and Recovery in the absence of driving licence and therefore, the findings of the
Tribunal is unsustainable in law.
13. This Court is of the considered view that Act only policy did not
cover the risk of passengers and therefore, the appellant Insurance Company is
not liable to pay compensation to the claimants and the owner of the Vehicle
alone is liable to pay compensation to the claimants as the accident occurred
only due to the rash and negligent driving of the driver of the car. There are
merits in this case and the award of the Tribunal warrants interference only with
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CMA No. 1073 of 2020
regard to fixing of liability on the appellant Insurance Company and the
quantum of compensation awarded by the Tribunal does not warrants any
interference.
14. In the result, this Civil Miscellaneous Appeal is partly allowed and
the Insurance Company is not liable to pay compensation and the owner of the
rd nd
vehicle / 3 respondent herein and the driver of the vehicle / 2 respondent
herein alone are liable to pay compensation to the claimants, as the accident
occurred due to the rash and negligent driving of the driver of the vehicle
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belonging to the 3 respondent. If any amount is paid by the appellant
Insurance Company to the claimants, the appellant Insurance Company is
entitled to get back the same. The respondents 2 and 3 are directed to pay
compensation along with interest and costs as awarded by the Tribunal to the
claimants, within a period of four weeks from the date of receipt of a copy of
this order. In all other aspects, the award of the Tribunal dated 24.07.2019 in
M.C.O.P.No.105 of 2014 on the file of the Motor Accidents Claims Tribunal
(Subordinate Judge) at Pollachi remains unaltered. No costs. Consequently,
connected Miscellaneous Petition is closed.
31-08-2026
Index: Yes/No
Speaking/Non-speaking order
Neutral Citation: Yes/No
Jvm
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CMA No. 1073 of 2020
M.JOTHIRAMAN J.
Jvm
To
Motor Accidents Claims Tribunal
(Subordinate Judge) at Pollachi.
CMA No. 1073 of 2020
and CMP NO. 6825 OF 2020
31-08-2026
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