Case BriefsHigh Courts

Himachal Pradesh High Court: Jyotsna Rewal Dua, J., partly allowed an appeal and declared that insurance company does not have the right to absolve itself from payment of compensation in absence of valid registration number.

In the present case, due to rash and negligent driving of respondent, an individual named Shri Ram Krishan died on the spot and the other passengers suffered injuries. The family members of the deceased filed for a claim petition under the Motor Vehicles Act, 1988 (‘Act’). The Learned Motor Accidents Claims Tribunal had awarded the claimants a compensation amount and the respondents did not challenge the award hence the award was pronounced ex parte. The tribunal had taken note of the fact that the driver was carrying a valid driving license at the time of the accident and thereby directed the insurance company to satisfy the award fastened upon the insured. The Insurance Company had submitted a reply stating that the vehicle did not have a registration certificate at the time of the accident; thereby the company shall be absolved from the onus of payment of compensation amount due to violation of the insurance policy. However, the issue was not argued before in the lower court and thus due to the issue involving questions of law and evidence the High Court has dealt the matter at length.

The counsel representing the appellant/Insurance Company, Jagdish Thakur submitted that the vehicle was unregistered according to the Chapter IV of the Act thus they were not liable to discharge the compensation amount as awarded by the Tribunal. The appellant placed reliance on Narinder Singh v. New India Assurance Company Ltd., (2014) 9 SCC 324 in support of his argument that plying of vehicle without valid registration number amounts to a fundamental breach in policy. The appellant had also questioned the computation of the award, stating that there were no documentary evidences to the income of the deceased and thus the learned tribunal erred in assuming the income.

The counsel representing the respondents, G.S. Palsra contended on this point that the precedent referred to by the appellants shall not be applicable in the present case due to the present matter dealing with third party liability.

The High Court upon perusal of the impugned judgment, award and the evidences produced, stated that an Insurance Company cannot exonerate itself from its duty to pay the compensation amount simply because the vehicle did not bear a permanent registration number in the cases of third-party liability. The Court stated that the Supreme Court decision in Narinder Singh dealt with cases of claims made by the owner of the vehicle, whereas the present case dealt with claimants being the dependents of the deceased-third party. It pointed out that “when the vehicle was insured towards third party liability, it was done so on the basis of engine number and chassis number. These numbers were duly mentioned in the insurance policy. The insurance is a contract between the insured and the insurer. It was not insured on the basis of temporary registration number or the permanent registration number.” The Court also noted that there was no connection between the cause of the accident and the registration/non-registration of the vehicle. However, placing reliance on the decisions in Shamanna v. Oriental Insurance Co. Ltd., (2018) 9 SCC 650 and Amrit Paul Singh v. TATA AIG General Insurance Co., (2018) 7 SCC 558, the present bench stated that the Insurance company can recover the compensation amount from the insured through the principle of “pay and recover” as laid down in the above precedents.   With regard to the issue of income of the deceased, the Court, due to lack of evidence, took into consideration the minimum wages of the year of the accident and accordingly delivered the calculation.[National Insurance Company Ltd. v. Kamal Kishore, 2019 SCC OnLine HP 932, decided on 05-07-2019]

Case BriefsHigh Courts

Gujarat High Court: A.Y. Kogje, J. passed an order of release of a vehicle involved in transporting mineral / illegal mining after imposing certain conditions. 

A petition was filed under Articles 14, 19, 21 and 226 of the Constitution of India to release the vehicle which was seized under the provisions of Gujarat Mineral (Prevention of Illegal Mining, Storage and Transportation) Rules, 2017 for it being involved in transporting mineral / illegal mining.

Kruti M. Shah, learned counsel for the petitioner submitted that he was ready to pay the penalty amount that may be specified by the authority after completion of entire proceedings at the departmental level or upon the completion of the trial if any.

Vrunda Shah, learned counsel for the respondent submitted that the vehicle was found involved in the illegal mining activity and therefore, the department has acted as per the provisions of Rules of 2017 and as the petitioner was not ready and willing to compound the offence, the vehicle could not have been released.

High court on noting the submission by the parties held that authorized officer was obliged to release the vehicle the moment the person alleged whose vehicle is involved in illegal mining activity furnishes the bank guarantee or the security deposit. The Court thus ordered the authorized officer to release the vehicle after complying with the certain mandatory conditions.[Mohammadkhan Karimkhan Ghori v. State of Gujarat, 2019 SCC OnLine Guj 838, decided on 09-05-2019]

Case BriefsHigh Courts

Madhya Pradesh High Court: This petition was filed before a Division Bench of S.C. Sharma and Virender Singh, JJ., against the order passed by the Collector under Rule 53 (6) of the M.P. Minor Mineral Rules, 1996 where a fine was imposed and petitioner’s truck and the trolley was confiscated.

Petitioner contended that the offence he was charged under was his first offence and thus, in light of the rule aforementioned, a collector could not have passed such order. Both parties had referred judgment dated 28-09-2018 passed in WP No.22046/2018 and other identical matter where it was submitted that under Rule 53 of M.P. Minor Mineral Rules, 1996, in case of the first offence, the penalty was 30 times the royalty of the mineral which petitioner was transporting illegally without any transit pass and the authorities without heeding to the aforesaid had directed the confiscation of the vehicle. In a catena of identical writs as mentioned above, similar submissions were made and Court had set aside the impugned order.

Therefore, impugned order was set aside with a view that lest, it is found that this is the first offence by petitioner, the question of compounding should be considered in view of the directions made in the aforesaid case referred. [Kanhaiya Dhangar v. State of M.P., 2019 SCC OnLine MP 184, dated 21-01-2019]

Case BriefsHigh Courts

Patna High Court: The Bench of Ahsanuddin Amanullah, J. dismissed an application filed under Section 482 of the Code of Criminal Procedure, 1973 praying for quashing of trial court’s order whereby prayer made by the petitioner regarding the release of a vehicle was dismissed.

In the instant case, OP-3 had filed a complaint alleging that opposite party 2 (OP-2) had taken a Scorpio vehicle belonging to him on the pretext of marriage in family assuring that he would return it. The vehicle was not returned and OP-3 was told by OP-2 that it had been stolen. OP-3 was assured that the vehicle would be located or OP-2 would pay him money for the same. On enquiring, OP-3 found that the vehicle had been allegedly sold to the petitioner and was with him. The vehicle was seized by the police pursuant to the lodging of FIR by OP-3.

The Court noted that the purported agreement of sale of vehicle relied upon by the petitioner was not even duly registered. Further, the certificate of registration for the vehicle was still in the name of opposite party 3.

It was held that the only document to prove ownership of a vehicle is a certificate issued by the transport department, i.e., the certificate of registration. Till such time the name of any other person is not duly entered in the official records and reflected in the certificate of registration with regard to the vehicle, vehicle could not be released in favour of a person who comes before with an unregistered agreement for sale of vehicle. [Md. Abdullah v. State of Bihar, 2019 SCC OnLine Pat 51, Order dated 17-01 2019]

Case Briefs

Supreme Court: Deciding the question involving the permissible alteration in a Motor Vehicle in view of the provisions contained in section 52 of the Motor Vehicles Act, 1988, Rule 126 of the Central Motor Vehicles Rules, 1989 and the effect of Rules 96, 103 and 261 of the Kerala Motor Vehicle Rules, 1989, the bench of Arun Mishra and Vineet Saran, JJ held:

“No vehicle can be altered so as to change original specification made by manufacturer. Such particulars cannot be altered which have been specified by the manufacturer for the purpose of entry in the certificate of registration.”

The Court said that the Rules are subservient to the provisions contained in section 52 of the MV Act and what is prohibited therein. It was clarified that

“No doubt about it that the vehicle has to be in conformity with the rules also but Rules cannot be so interpreted so as to permit the alteration as prohibited under section 52(1) of the Act. The alteration under the Rules is permissible except as prohibited by section 52.”

The Court noticed that Section 52 of the MV Act has undergone change by way of Amendment Act 27/2000 with the purpose to prohibit alteration of vehicles in any manner including change of tyres of higher capacity, keeping in view road safety and protection of environment. It said:

“The amended section 52(1) has specified the extent to which vehicle cannot be altered. A reading of the provisions makes it clear that no vehicle can be altered in a manner where particulars in the certificate of registration are at variance with those “originally specified by the manufacturer”.”

The Court further explained:

“The emphasis of section 52(1) is not to vary the “original specifications by the manufacturer”. Remaining particulars in a certificate of registration can be modified and changed and can be noted in the certificate of registration as provided in section 52(2), (3) and (5) and the Rules. Under section 52(5), in case a person is holding a vehicle on a hire purchase agreement, he shall not make any alteration except with the written consent of the original owner.”

[Regional Transport Officer v. K. Jayachandra, CIVIL APPEAL NOS.  219­222 OF 2019), decided on 09.01.2019]

Case BriefsForeign Courts

High Court of South Africa, Eastern Cape Division: Plaintiff had approached this court before a Single Judge Bench of E. Revelas, J., for grant of damages against the defendant for injuries sustained by him during a motor vehicle accident.

Counsel of defendant, Advocate Paterson conceded that in absence of any contrary version the plaintiff’s account of the accident had to be accepted but since plaintiff did not apply brakes shows his negligence and that there was contributory negligence on his part.

High Court was of the view that even if some other driver would have reacted differently in the same circumstances, it does not mean that the plaintiff’s responses and actions were negligent. It was noticed that if the plaintiff had applied brakes it could have caused the vehicle to skid into other traffic and could have then resulted in contributory negligence. Court found the other colliding vehicle’s driver to be aggressive, reckless and inconsiderate and the one to be wholly blamed. Therefore, the defendant was directed to pay 100% of damages to the plaintiff. [Nicholas v. Road Accident Fund, Case No. 3880 of 2015, decided on 27-11-2018]


Case BriefsHigh Courts

Gujarat High Court: A Single Judge Bench of R.P. Dholaria, J., allowed a petition filed against the order of the lower courts, whereby petitioner’s application for granting custody of his vehicle which was involved in an offence under the provision of Gujarat Prohibition Act, 1949, was dismissed.

The main issue that arose before the Court was whether the lower courts were justified in rejecting the application of petitioner for the release of his vehicle, pending investigation.

The Court observed that the lower courts have not handed over the interim custody of the vehicle to petitioner in view of Section 98 of the Gujarat Prohibition Act, 1949, which provides embargo for handing over the custody of the vehicle used in the offence pending the trial. The respondent’s contention with regard to the lower courts and revisional courts having no jurisdiction to hand over custody of the vehicle used in the offence as per the provisions of Section 451 of the Code of Criminal Procedure 1973, was rejected by the Court.

The Court held that this instant case was covered by the judgment delivered in Hardikbhai Mukeshbhai Chauhan v. State of Gujarat, Special Criminal Application No. 7642 of 2018 and subsequently allowed the petition filed by the petitioner. The Court directed the lower court to immediately release the vehicle owned by the petitioner after due verification and following the procedure of recording such evidence as it thinks necessary as provided under Section 451 of the Code of Criminal Procedure 1973. [Rangrej Shokatbhai Noormohammed v. State of Gujarat, R/Special Criminal Application No. 9528 of 2018, Order dated 30-10-2018]

Case BriefsHigh Courts

Kerala High Court: A Full Bench of Kerala High Court comprising of CJ Hrishikesh Roy P.R. Ramachandra Menon, A.K. Jayasankaran Nambiar, Anil K. Narendran and Devan Ramachandran, JJ. while a reference held that non-possession of a valid fitness certificate for a vehicle constitutes fundamental breach of insurance policy, entitling the insurer to exercise ‘pay and recover’ option in compensation cases arising out of accidents caused by such vehicles.

The five-judge bench was considering the correctness of a three-judge bench judgment in Augustine v. Ayyappankutty, 2015 SCC OnLine Ker 14898 where it was held that absence of permit/ fitness certificate to a transport vehicle is only a technical breach.

The Court went through the provisions of the Motor Vehicles Act, 1988 (MV Act) dealing with requirement of permits and/ or fitness certificate and discerned the intention of Legislature behind incorporating the said provisions.

It was noted that as per Section 149(2)(c) of MV Act, an insurer is not bound to pay the insured amount in case the vehicle being used does not have a valid transport permit. Section 66 stipulates that any registered motor vehicle must have a valid permit in order for putting the same on road. The necessity of having a ‘certificate of fitness’ is prescribed under Section 54, and Section 56 of the MV Act also states that a transport vehicle will not be deemed as validly registered if it does not possess a certificate of fitness. Section 84 prescribes general conditions attached to all permits; and Rule 47(1)(g) of the Central Motor Vehicles Rules, 1989 stipulates that an application for registration of a vehicle must be mandatorily accompanied by a road worthiness certificate.

The Bench observed that “Certificate of Registration, existence of valid Permit and availability of Fitness Certificate, all throughout, are closely interlinked in case of a transport vehicle and one requirement cannot be segregated from another”. It was
noted that the abovementioned provisions clearly substantiated the importance and necessity of having a fitness certificate to a transport vehicle at all times. Assurance of a vehicle being completely fit to be plied on the road assumes importance in relation to the life and limb of people traveling in the vehicle, pedestrians, and other vehicles.

Relying on the aforesaid reasoning and judgment of the Apex Court in Amrit Paul Singh v. TATA AIG General Insurance Co. Ltd., (2018) 7 SCC 558 the High Court held that any lapse by the owner of the vehicle in relation to possession of a valid fitness certificate would amount to a fundamental breach enabling the insurer to recover the relevant amount from the insured. On that holding, the judgment in Augustine v. Ayyappankutty, 2015 SCC OnLine Ker 14898 was set aside. [Ramankutty v. Pareed Pillai,2018 SCC OnLine Ker 3542, decided on 09-10-2018]

Case BriefsHigh Courts

Rajasthan High Court: A Single Judge Bench comprising of  P.K. Lohra, J., decided a revision petition for an offence under Section 8 and 15 of the Narcotic Drugs and Psychotropic Substances Act, 1985 to assail the impugned order passed by the Special Judge.

The brief facts of the case are that the petitioner was an accused of an offence under the provisions of NDPS Act. Petitioner had moved his application for trial under Section 457 CrPC for the release of the vehicle which contained 37 kg poppy husk/straw in it. The petitioner has preferred this appeal for the release of his vehicle.

Learned Counsel for the petitioner stated the case of Prakash Chand v. State of Rajasthan; 2010 SCC OnLine Raj 992, in which the vehicle was seized for carrying contraband of small quantity. By taking the essence of the stated judgment, the Court acceded to the prayer of the incumbent.

Therefore, the Hon’ble Court concluded its judgment by stating that the vehicle is likely to be confiscated after the trial which leads to the conditional release of the vehicle on “NDPS Act” and interim custody of the vehicle can be granted on that basis.  Court also laid down a few conditions in which furnishing of a personal bond of a sum of Rs. 3,00,000/- along with the undertaking of ownership of the car not to be transferred or leased, further no such antisocial activity to be carried on which may constitute the offence under the NDPS Act. The High Court has thereby allowed the instant revision petition by allowing quashing of the impugned order and setting it aside. [Kamlesh v. State of Rajasthan, 2018 SCC OnLine Raj 1227, dated 16-05-2018]