ORIENTAL INSURANCE CO Vs. ANANDA PAI

JUDGEMENT

(1.) In this appeal by the insurer, the challenge is against the interest granted from the date of claim petition, 7.2.1992; as the appellant insurer was impleaded in the claim case only on 11.10.1996. Relying on S.171 of the Motor Vehicles Act, it is contended that the appellant became a party to the petition and the petition became pending against the appellant only from 11.10.1996. Therefore, the appellant is liable to pay interest, whatever be the rate granted by the tribunal below, only from the date and not from 7.2.1992, the appellant was impleaded as the appellant was not a party to the claim petition until then.

(2.) We are unable to accept this contention because the role of the appellant is only as an indemnifier. The primary liability is cast on the driver and the owner of the vehicle. It was on the basis of the contractual relationship subsisting between the owner and the appellant that the appellant undertakes to discharge the liability cast on the owner. The owner has the liability to pay interest on compensation from the date of application viz., 7.2.1992. In such circumstances, the appellant, whatever be the date, cannot shirk out of that liability and contend that the appellant will pay interest only from 11. 10.1996. With reference to the rate of interest also, we find no merit in the contention. The decision of the Supreme Court reported in Kaushunuma Begum v. New India Assurance Co. Ltd., 2001 (1) KLT 408 is also relied on this regard. But it has to be remembered that being an insurer, the appellant will have limited contentions and defences available under S.149(2) of the Motor Vehicles Act before the tribunal and in the appeal. With reference to the rate of interest, no such defence is available in terms of the statute. There was no order under S.170 to arm the appellant with all the defences that are available to the insurer. So that contention also fail.