Legal Reference Library

The Karnataka High Court in Hussain vs. Imtiyan Khan has held that a legal representative of a claimant cannot challenge the award and she does not inherit the right to prosecute the appeal after death of the claimant. The legal representative of the claimant had contended that when insurance company files an appeal challenging the award of the tribunal, if a legal representative of the injured can be permitted to come on record on the death of injured during the pendency of the appeal, the same is to be permitted when the injured files an appeal and dies subsequently. Justice Sreenivas Harish Kumar said: “If he had not died, he could have prosecuted the appeal seeking enhancement of compensation. The moment he died, his wife is only entitled to recover the compensation granted by the tribunal. Right to prosecute an appeal being a legal representative is not heritable. If it is possible to make out the cause of death as due to personal injuries owing to accident, the wife gets a ri...

In Sheela O.K. Vs. New India Insurance Company, the Hon'ble Kerala High Court decided that When an insurer is impleaded as a party-respondent to the claim petition, as contrasted from merely being a noticee under Section 149(2) of the Act, its rights are significantly different. If the insurer is only a noticee, it can only raise such of those grounds as are permissible in law under Section 149(2). But if he is a party-respondent, it can raise, not only those grounds which are available under Section 149(2), but also all other grounds that are available to a person against whom a claim is made. If the insurer is already a respondent, having been impleaded as a party-respondent, it need not seek the permission of the Tribunal under Section 170 of the Act to raise grounds other than those mentioned in Section 149(2) of the Act.

The Supreme Court in Sandhya Rani Debbarma & Ors. Vs. The National Insurance Company Ltd. & Anr, has observed that determining the compensation under different heads such as loss of estate, funeral expenses, loss of consortium etc. is crucial while computing award of compensation due to dependants of the deceased in motor accidents. In the instant case, the husband of the appellant Sadhya Rani died in an accident in Baramur in 2003, following which she filed a suit before the Agartala Motor Accident Claims Tribunal seeking a compensation of Rs 33.45 lakh. The Tribunal in 2005, by way of judgment, said Rs 32,52,700 be given to the deceased’s family. The National Insurance Company challenged the Tribunal verdict in Gauhati High Court, which modified the award and reduced it to Rs 20.40 lakh in 2006. An apex court Bench comprising Justice V Gopala Gowda and Justice Adarsh Kumar Goel said it disagreed with the view adopted by the Gauhati High Court, which had modified the Tribunal ...

National Consumer Disputes Redressal Commission:  An insurance company can reject an insurance claim of a stolen vehicle on the ground that the vehicle was not duly registered, observed NCDRC while allowing a revision petition of Oriental Insurance Co. Ltd. vide which the Company challenged the order of Himachal Pradesh State Consumer Commission granting compensation to vehicle owner. This order of the National Consumer Disputes Redressal Commission has its origin in the theft of a vehicle owned by the complainant, and the rejection of his claim by the insurance company on the ground that the vehicle was not registered at the time of theft. The vehicle, Mahindra Bolero SLX, purchased on June 14, 2008 for Rs 5,94,000  had been insured covering the period from 19.06.2008 to 18.07.2009. Six months later, on December 27, 2008, the vehicle unfortunately was stolen, giving rise to a claim. The insurance company however repudiated the claim on the ground that the vehicle had no va...

The district consumer court has ruled that an insurance company cannot repudiate claim for damages if the driver of the insured vehicle has, in any way, not contributed to the accident involving the vehicle. The consumer court imposed a cost of Rs 5,000 on New India Assurance Company and directed it to reimburse a city-based lawyer Rs 40,897 as car repair charges after her vehicle was involved in an accident on Lal Bahadur Shastri road on March 7, 2013. A speeding tempo had dashed against the car, resulting in the driver momentarily losing control over the steering wheel and crashing into a road divider. Manasi Joshi, the complainant, had filed a Rs40,897 claim for damages suffered by her car. The insurance company rejected Joshi's claim on May 5, 2013, arguing that the car was being driven by her husband who did not posses a valid driver's license. Later, she filed a consumer complaint seeking the court's directions to the insurance company for reimbursement of her insu...

Uttarakhand High Court has recently held that a person, who met with accident, in any manner, being an employee, then he may claim compensation under either Motor Vehicles Act or Workmen’s Compensation Act but he cannot be at liberty to claim such compensation under both the Acts. Justice Servesh Kumar Gupta has dismissed an Appeal filed by Dalbir Lal who already got the compensation under Motor Accidents Claims who approached the Court seeking further compensation under the Workmen Compensation Act for the reason that he met an accident when he had already left his Office and was in the way to reach his home. Dismissing the Appeal the Court held that Section 167 of the Motor Vehicles Act contemplates in so many words regarding claims for compensation of a person, who met with accident, in any manner, being an employee, then he may claim compensation under either Motor Vehicles Act or Workmen’s Compensation Act but he cannot be at liberty to claim such compensation under both the A...

The Madras High Court has said compensation awarded by the Motor Accident Claims Tribunal or the interest accruing therein cannot be subjected to tax deducted at source (TDS). A civil revision plea was filed by the Managing Director, Tamil Nadu State Transport Corporation (Salem) Limited, Dharmapuri, against an order passed by Additional District Judge, Fast Track Court, directing the corporation to deposit the amount deducted as TDS to the MACT claimant. The Hon'ble court said that compensation awarded by the Motor Accident Claims Tribunal, and interest accruing thereon, is to ameliorate the sufferings of the victims and does not have the character of "income". If there is a conflict between a social welfare legislation and a taxation legislation, the social welfare legislation will prevail since it subserves larger public interest. Article referred: http://www.financialexpress.com/article/personal-finance/accident-compensation-cannot-be-subjected-to-tds-madras-hi...

The National Consumer Dispute Redressal Commission has held that vehicles carrying passengers in excess of its capacity, cannot claim own damage insurance cover. The Bench comprising of Justices Ajit Bharihoke and Rekha Gupta upheld the State Forum view that in an own damage claim case, defense of overloading is available to the insurer. In this case, the District Forum had allowed the own damage claim against the insurer by the bus owner. But on appeal, the State Consumer Dispute Redressal Forum [Read order] had observed that there is ample material on record to show that the bus having seating capacity of 35+1 was carrying passengers much in excess of its capacity, and hence in these circumstances if the claim is not paid by the insurer it cannot be said to be deficiency in service. In third party cases defense of overloading might not be available but this is an Own Damage case and a person cannot be permitted to take advantage of his own wrongs, the Forum had said. Dismissing the R...

While observing that the theft of a vehicle is required to be reported to the insurance company immediately after the theft is detected otherwise the insurer is not liable to reimburse the insured for such a loss, NCDRC upheld the repudiation of insurance claim by insurance companies in two separate cases of theft of vehicle. This order was pronounced by the Commission during the hearing of two revision petitions. Subject matter of both the petitions was similar i.e. theft of vehicle and repudiation of claim by insurance companies on the ground of delay in intimation of the theft to the insurance company. In one case complainant purchased a truck dumper and got the same insured with the Reliance General Insurance Co. Ltd. for the period from 10.10.2010 to 09.10.2011. During the subsistence of the insurance policy, the vehicle was stolen between 06.6.2011 to 07.6.2011 and a report with the concerned police station was lodged on 07.6.2011 itself. The intimation to the insurance company h...

IN THE SUPREME COURT OF INDIA Civil Appeal Nos. 49-50 of 2016 (Arising out of SLP (C) Nos. 37534-37535 of 2013) Decided On: 07.01.2016 Appellants: Lakhmi Chand Vs. Respondent: Reliance General Insurance Hon'ble Judges/Coram: T.S. Thakur, C.J.I. and V. Gopala Gowda, J. Counsels: For Appellant/Petitioner/Plaintiff: Munawwar Naseem, Adv. For Respondents/Defendant: Garvesh Kabra, Adv. Subject: Consumer Subject: Insurance Catch Words Mentioned IN Acts/Rules/Orders: Consumer Protection Act, 1986 - Section 12, Consumer Protection Act, 1986 - Section 21, Consumer Protection Act, 1986 - Section 149(2), Consumer Protection Act, 1986 - Section 163A, Consumer Protection Act, 1986 - Section 166; Indian Penal Code (IPC) - Section 279, Indian Penal Code (IPC) - Section 304A, Indian Penal Code (IPC) - Section 337, Indian Penal Code (IPC) - Section 338, Indian Penal Code (IPC) - Section 427 Cases Referred: National Insurance Co. Ltd. v. Pravinbhai D. Prajapati IV 2010 ...

When several persons are guilty of causing a road accident leading to death or injury, the claim for compensation can be made against each,or all of them. The claimant has a choice. The persons liable can later sue each other for their share of liability after paying the amount to the claimant. This rule was reiterated in the case, Kamlesh vs Attar Singh, by the Supreme Court. A speeding car hit an equally negligent tempo killing a passenger in the latter. His widow, mother and three minor children sued the drivers of both vehicles, the owner of the car and its insurance company. The tribunal found that they were all guilty of 'composite negligence' and they should pay Rs 5.81 lakh to the family. The tempo driver appealed to the Punjab & Haryana High Court, which set aside the award made by the tribunal. The family appealed to the Supreme Court and it restored the order of the tribunal, stating that the high court had not assessed the evidence properly.

NCDRC has upheld the repudiation of claim by the insurance company in a case of theft of cash on the ground that complainant (appellant) failed to take reasonable care for protection of cash by leaving the doors of the car unlocked. Earlier, complainant who is the proprietor of a firm M.R. Jewellers, engaged in export of jewellery, had taken cash in transit policy to cover any single cash in transit upto Rs. 10 lacs from National Insurance Co. It was alleged by the complainant that one day when the complainant was carrying a cash bag of Rs. 9,85,000/-, on the rear seat of the car, two young boys on a motorcycle indicated the complainant that the rear left side tyre of his car was punctured. Therefore, complainant stopped the car on the side of the road and got down and took out stepany from the dickey of the car and changed the rear left side tyre within 10 to 12 minutes. When complainant entered the car after change of wheel, he found cash bag missing from the car. The insurance claim...

While upholding the repudiation of the claim of the complainant by LIC on the ground of suppression of material facts, as proper, NCDRC observed that a contract between the parties falls in the category of contract uberrimae fidei, meaning a contract of utmost good faith on the part of the assured. When information on a specific aspect is asked for in the proposal form, an assured is under a solemn obligation to make a true and full disclosure of the information on the subject which is within his knowledge. It is not for the proposer to determine whether the information sought for, is material for the purpose of the policy or not. Earlier the deceased obtained LIC policy of Rs.1,00,000/- which commenced from July 9, 1994. He passed away due to cerebro-vascular accident in the hospital on 14.11.1994. The parents of the deceased filed the claim before LIC, which repudiated the claim stating that the assured was suffering from infective hepatitis and was hospitalized for treatment prior t...

NCDRC has upheld the repudiation of claim by the insurance company in a case of theft of vehicle on the ground that respondent was not having valid driving licence at the time of incident and he had also not taken ignition keys of the car when he went for urination, hence violating the terms of policy. National Insurance Co. Ltd. v. Ram Singh Gurjar, 2015 SCC OnLine NCDRC 2291, decided on 18-9-2015

National Consumer Disputes Redressal Commission (NCDRC): While declaring the repudiation of claim of a policyholder by the insurance company on the ground of non-disclosure of material facts as improper, NCDRC directed the insurance company to pay the insurance cover amount to the policyholder. A pilot of a private airline had approached NCDRC alleging that he was denied insurance claim on the ground that he did not disclose the fact that he was a known case of Hypertension and chronic kidney disease. Earlier, the complainant who was working for Jet Lite (India) Ltd. as pilot from 01.12.2007 had obtained a policy Ltd. of Rs.1.00 crore in April, 2009 from New India Assurance Co. and paid a sum of Rs.56, 200/- as premium. Later, in December, 2009, when the complainant was declared ‘permanently unfit’  for flying, he approached the insurance company for his policy claim but his claim was repudiated on the ground that he did not disclose the fact that he was a known case of Hypertensio...

Bombay High Court: In a case of a company involved in a dispute and undergoing arbitration, a bench comprising of G.S. Patel, J. directed its lenders to wait for the passing of interim award before taking steps to get their money back. In the instant case, a company was incorporated to construct a bridge on a build, operate and transfer basis. A tax policy announced subsequently gave vehicles operating within a 5 km radius a substantial discount in toll rates, which affected the profitability and feasibility of the project. As the plaintiffs were unable to service their debts, the lender banks moved to sell off the pledged shares. The plaintiff company then approached the Court to restrain the lender banks from selling off the pledged shares before the passing of interim award in an arbitration between the company and State Government as they were expecting a favourable decision. The Court held the request of the plaintiffs to be ‘reasonable’ and ‘moderate’ and in interest of both t...

1) Jyothi Ademma vs. Plant Engineer, Nellore & Another 2) A. Trehan vs. Associated Electrical Agencies and Another 3) Regional Director, ESI Corporation vs. Francis De Costa 4) P. Asokan vs. Western Indian Plywoods Ltd., Cannanore 5) Bharagath Engineering vs. R. Ranganayaki and Another 6) National Insurance Company Ltd. vs. Hamida Khatoon and Others IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.8155 OF 2014 Dhropadabai and Others Appellant(s) Versus M/s. Technocraft Toolings Respondent(s) The labour Court framed two principalcssues, namely, whether the accident had occurred during course of employment of the deceased-employee, and whether the legal heirs were entitled for grant of compensation amounting to Rs.3 lacs along with 50% penalty and interest at the rate of 18% per annum on the total amount of compensation from the date of accident till realization of compensation amount as per law. once an emp...

While deciding on the issue of rejection of claim on the ground of inordinate delay and laches in an industrial dispute, the bench of Sanjay Karol, J. held that delay in raising the dispute and referring the same to the Labour Court for adjudication is not erroneous and it also does not debar the workman from claiming rightful relief from his employer. The Court relying on Raghubir Singh v. General Manager, Haryana Roadways, (2014) 10 SCC 301, stated that the workman is entitled for reinstatement, back wages and consequential benefits from the date of raising the industrial dispute. Giving reasons, the Court observed that it is reasonable to adjudicate the industrial dispute in spite of the delay in raising and referring the matter, since there is no mention of any loss or unavailability of material evidence due to the delay. It further stated that the Labour Court is statutorily duty bound to answer the points of dispute referred to it by deciding the same on merits of the case, an...