DIVISIONAL OFFICER ORIENTAL INSURANCE CO LTD Vs. SIVASANKARAN

JUDGEMENT

(1.) This is an appeal at the instance of Oriental Insurance Co. Ltd., which is impleaded as the respondent No. 3 in O.P. (M.V.) No. 696 of 1994. Petition was filed by the respondent herein under section 166 of the Motor Vehicles Act, 1988. The petitiont-, who was injured in a motor accident on 26.5.1993, claimed an amount of Rs. 5,00,000 as compensation. The owner and driver of the offending vehicle were impleaded as respondent Nos. 1 and 2. They remained ex parte, Respondent No. 3 entered appearance and contended that the accident happened not due to negligence on the part of the offending vehicle, that the amount of compensation claimed is exorbitant and that the respondent No. 1 had violated the policy conditions. The respondent No. 3 further contended that it is entitled to raise all defences independently, including the one relating to the quantum of compensation, which are open to the insured against third parties in view of the reservation clause included in the policy. It was also stated therein that in addition to the right under the reservation clause, respondent No. 3 was entitled to avail the provisions under section 170 of the Motor Vehicles Act, 1988. Tribunal found that the respondent No. 2 was driving the offending vehicle in a rash and negligent manner causing the accident. A total amount of Rs. 2,00,000 was granted as compensation to the peti tioner with 12 per cent interest from the date of petition till realisation. In this appeal filed by the insurance company, challenge is against the quantum of compensation granted by the Tribunal.

(2.) A preliminary objection was raised on behalf of the respondent. It was contended by the learned counsel that the appeal at the instance of the insurer challenging the quantum of compensation is not maintainable, since the insurance company has not obtained specific order under section 170 of the Motor Vehicles Act, 1988 in this regard. In support of his contention, learned counsel placed reliance on two decisions of the Supreme Court, viz., Shankarayya v. United India Insurance Co. Ltd., 1998 ACJ 513 (SC) and Chin- nama George v. N.K. Raju, 2000 ACJ 777 (SC). It was also contended that the insurance company cannot be permitted to produce copy of the insurance policy before this court for the first time as the circumstances would not satisfy the provisions contained under Order 41, rule 27 of the Code of Civil Procedure. Yet another objection raised by the respondent is that the appeal is not maintainable in the absence of respondent Nos. 1 and 2 in the original petition on the party array in this appeal.

(3.) Learned counsel for the appellant would submit that the dictum laid down by the Supreme Court in the decisions relied on by the respondent has no application in the present case as there is a reservation clause in the policy. Even without taking recourse to section 140 (Sic. 170} of the Motor Vehicles Act, it will be open to the insurance company to take up all the defences which are open to the insured under law. In support of his contention, he placed reliance on a decision of the Apex Court in British India Genl. Ins. Co. Ltd. v. Captain Itbar Singh, 1958-65 ACJ 1 (SC) and also a Full Bench decision of this court in New India Assurance Co. Ltd. v. Celine, 1993 ACJ 371 (Kerala). Learned counsel for the appellant further contended that respondent Nos. 1 and 2 in the petition were not made parties in the appeal since the Tribunal had passed the award only against the appellant insurance company. There was no occasion to produce the insurance policy before the Tribunal as the contention raised by the insurance company in its statement about the reservation clause was not challenged by the petitioner.