NATIONAL INSURANCE COMPANY LTD Vs. KAMALA KHAITAN

JUDGEMENT

(1.) Present appeal is directed against an order dated 26th March, 2004 passed by Motor Accident Claims Tribunal dismissing an application under Section 170 of the Motor Vehicles Act, 1988 (for short â the Actâ ) made by appellant insurance company.

(2.) The application was made seeking permission to widen scope of its defences on the ground that the owner and/or driver of the offending vehicle have colluded with the claimant as they failed to contest the claim and were proceeded ex parte. Though the Tribunal noticed that to attract application of Section 170 of the Act either of the two conditions, namely, (a) that there is collusion between the claimant and the owner and/or driver of the offending vehicle; or (b) owner and/or driver of the offending vehicle failed to contest the proceedings, has to be satisfied it proceeded to find that clause (b) of Section 170 would be invokable only where failure of owner/driver to contest the claim is in furtherance of collusion between them and the claimant. It further held that merely because owner and driver were proceeded ex parte and did not contest the claim that by itself would not suffice to infer that there was collusion between the claimant and the owner and driver of the offending vehicle to attract Section 170 of the Act to accord permission to the appellant to widen the scope of its defence.

(3.) Learned counsel for the appellant refers to a decision of the Supreme Court in United Indian Insurance Co. Ltd. Vs. Jyotsnaben Sudhirbhai Patel and Ors; (2003) 7 SCC 212 to contend that the view taken by the Tribunal is wholly erroneous inasmuch as the two conditions contemplated under Section 170 of the Act are independent of each other and where the owner and/or driver of the offending vehicle fail/s to contest the proceedings that would satisfy the legal requirement to accord permission under Section 170 to widen the scope of defences available to the insurance company and it need not be shown that the owner and/or driver of the offending vehicle failed to contest the proceedings by virtue of any collusion between them and the claimant.