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National Insurance v. Nagammal - CRP.PD.144 of 2007  RD-TN 1918 (13 June 2007)
IN THE HIGH COURT OF JUDICATURE AT MADRAS
THE HON'BLE MR.JUSTICE S.ASHOK KUMAR
CRP(PD) Nos. 144 and 145 of 2007
M.P.Nos. 1 + 1 of 2007
The Branch Manager,
National Insurance Co.,Ltd.,
Krishnagiri Post and District ... Petitioner in both CRPs Vs.
Tmt.Nagammal ... Respondent in both CRPs Civil Revision Petitions are filed against the fair and decretal order dated 8.11.2005 made in I.A.Nos.1050 and 1052 of 2005 in MCOP.No:1365 of 2001 on the file of the learned I-Additional District Court, Dharmapuri at Krishnagiri. For Petitioner : Mr.N.Vijayaraghavan For Respondent : Mr.M.Selvam
These Civil Revision Petitions are filed against the fair and decretal order dated 8.11.2005 made in I.A.Nos.1050 and 1052 of 2005 in MCOP.No:1365 of 2001by the learned I-Additional District Court, Dharmapuri at Krishnagiri dismissing the two I.As., filed by the revision petitioner/2nd respondent in the MCOP to reopen the respondents evidence and to receive a letter dated 12.9.2005 as additional document.
2. According to the revision petitioner, the Driver of the vehicle at the time of the accident was one Srinivasan and not Mr.Elavarasan. But, with the connivance of the police official, the claimants filed the petition and therefore, the respondents referred the matter to the CBCID. Hence the said reference letter dated 12.9.2005 addressed to the DIG of CBCID is a vital document and consequently evidence has to be reopened and the said document has to be marked as an Exhibit. However, the claimants resisted the petitions stating that the Insurance Company did not raise such an objection in the MCOP Nos:38, 39 of 1999 and 342 of 2001 which are already divided and award have been passed. Mere marking the letter will not improve the case or demolish the claim of the claimants and the said letter is totally irrelevant and the same need not be marked.
3. The learned First Additional District Judge, Dharmapuri, dismissed the I.As holding that the said letter is irrelevant either to accept the case of the petitioner or negative the claim of the claimants in the main O.P., Aggrieved of the same, the present revisions are filed.
4. In a similar matter between the National Insurance Company Ltd., Vs. Shanaz Begam and 6 others, in CRP.No:332 and 332 of 2006, decided by this court on 28.11.2006, while dealing with Sections 149 and 170 of the Motor Vehicles Act, this court observed as follows:- "6. Section 149 of the Motor Vehicles Act deals with the duty of the Insurers and also the grounds on which they can defend any claim or action brought against them which are as follows:- (a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:- (i) a condition excluding the use of the vehicle- (a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or (b) for organised racing and speed testing, or (c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or (d) without side car being attached where the vehicle is a motor cycle; or (ii) a condition excluding driving by a named person or persons or by any person who is not duly licensed, or by any person who has been disqualified for holding or obtaining a driving licence during the period of disqualification; or (iii)a condition excluding liability for injury caused or contributed to by conditions of war, civil war, riot or civil commotion; or (b) that the policy is void on the ground that it was obtained by the non disclosure of a material fact or by a representation of fact which was false is some material particular.
7. But, Section 170 of the Motor Vehicles Act makes it clear that if there is a collusion between the person making the claim and the person against whom the claim is made, or the person against whom the claim is made has failed to contest the claim, it may, for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaed as a party to the proceeding and the insurer so impleded shall thereupon have, without prejudice to the provisions contained in Sub section (2) of Section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made.
8. Thus it is clear that Section 170 of the Act has a overriding effect on Section 149 of the Act. This Court is aware of the fact that number of bogus claims have been filed and awards have been obtained based on such bogus claims incurring heavy loss to the Insurance Companies. In this regard in 2006 (2) L.W. 176 (National Insurance Company Ltd., Vs. DGP, and 28 Others) the First Bench of this Court in a batch of Writ Petitions observed as follows:- "8....The Director of Central Bureau of Investigation, new Delhi is directed to constitute a Special Team of Investigation for carrying the investigation in the present matter. It is further directed that when filing of such complaint is brought to the notice of the concerned Motor Accident Claims Tribunal, the Tribunal shall take note of it before passing the order and if necessary to record further evidence in order to ascertain the genuineness of the claim...."
9. Again the First Bench of this Court in a batch of writ petitions filed by the contesting parties and some of the Insurance Companies as well, gave the following direction:- "4. We find considerable merit in the submission of the learned counsel for the Insurance Companies. Insurers alone are not the affected parties due to such fraudulent claims. The liability saddled on the insurers is naturally being passed on to the ordinary consumers of the Insurance. Such large scale insurance fraud are prevailing not only in the State of Tamil Nadu but even in other parts of the Country. In the State of Tamil Nadu alone more than 1100 cases have been detected. It is pertinent to note that as soon as the CBI started taking cognizance of the cases, more than 1500 claims involving Rs.60crores of rupees have been withdrawn by the so called claimants. Considering the large number of fraudulent cases and the amount involved, which directly affects the financial interest of the PSU Insurers in particular and the ordinary consumers of insurance, it is high time that Union of India and the Insurance Regulatory Development Authority to consider the setting up of Insurance Frauds Offices/Bureaus or such similar bodies in different parts of the country to deal with the insurance frauds. The Secretary to Government, "Finance Department, Union of India is directed to file an affidavit explaining the stand of the Union of India on this issue within a period of eight weeks."
5. The anguish and concern of their Lordships referred to above equally applies to the present facts of this case. In the present case, the contention of the Insurance Company is that the Insurance Claim itself is false and according to them the accident never occurred as claimed by the claimants and at the time of the accident, the driver of the vehicle was one Srinivasan and not one Elevarasan. According to the learned counsel for the revision petitioner/Insurance Company, there is a collusion between the first respondent-owner of the vehicle as well as the claimants and to investigate the same, they have addressed a letter to the CBCID. If the finding of the investigation is in favour of the Insurance Company, then the very liability to pay compensation would arise for consideration before the trial court. The document which is sought to be adduced is the copy of the letter given to the CBCID. Therefore, the document which is sought to be adduced as additional evidence by the Insurance Company assumes much importance in the light of the observations made by the Hon'ble First Bench of this Court wherein their Lordships have observed that when filing of such complaint is brought to the notice of the concerned Motor Accident Claims Tribunal, the Tribunal shall take note of it before passing the order and if necessary to record further evidence in order to ascertain the genuineness of the claim. Therefore the revision petitioner/Insurance Company must be given an opportunity to make a defence as contemplated under Section 170 of the Motor Vehicles Act, which provisions has a overriding effect on the provisions of Section 149 of the Act under certain peculiar circumstances of the Case when it comes forward with a contention that the claim itself is bogus and the accident never took place as alleged by the claimants, which raises a serious doubt as to the genuineness of the claim.
6. In such circumstances, if the Insurer is not permitted to take all the available defences, then great hardship will be caused to the Insurance Companies, particularly, in view of the prevailing situation, where large number of bogus claims have been found out throughout the country. Therefore, in the peculiar facts and circumstances of the case, it is just and necessary for the revision petitioner/Insurance Company to file additional documents which shall be received by the trial court and taking into consideration of the same pass suitable orders and if necessary to record further evidence in order to ascertain the genuineness of the claim as directed by the Hon'ble First Bench of this Court.
7. In the result, both the CRPs are allowed setting aside the orders made in I.A.Nos:1050 and 1052 of 2005 respectively in MCOP.No. 1365 of 2001 passed by the learned I-Additional District Judge, Krishnagiri. Consequently, connected Miscellaneous Petitions are closed. No costs.
The I-Addl.District Judge,
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