- 1 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21ST DAY OF JULY, 2025 BEFORE THE HON'BLE MR. JUSTICE T.M.NADAF MISCELLANEOUS FIRST APPEAL NO.4770 OF 2020(MV-I) BETWEEN: SMT. PUTTALAKSHMAMMA AGED ABOUT 61 YEARS, R/AT AKKIHEBBALU VILLAGE, AKKIHEBBALU HOBLI, K.R.PET TALUK, MANDYA DISTRICT-571 33 …APPELLANT (BY SRI. P NATARAJU, ADVOCATE) AND: 1. SRI P KAPANAIAH MAJOR, S/O PUTTAPPA, R/AT SASALU VILLAGE, KIKKERI HOBLI, K.R.PET TALUK, MANDYA DISTRICT-577 133 2. THE BRANCH MANAGER BAJAJ ALLIANZ GENERLA INSURANCE COMPANY LIMITED, NO.363, SRI HARI COMPLEX, SEETAVILASA ROAD, MYSURU-570 024 …RESPONDENTS (BY SRI. B. PRADEEP, ADVOCATE FOR R2, R1-SERVED AND UNREPRESENTED) Digitally signed by MADHUSHREE H Location: High Court of Karnataka - 2 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 THIS MFA IS FILED U/S.173(1) OF MV ACT, AGAINST THE JUDGMENT AND AWARD DT.09.09.2020 PASSED IN MVC NO.39/2009 ON THE FILE OF THE SENIOR CIVIL JUDGE AND JMFC, K.R.PET, PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION. THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR. JUSTICE T.M.NADAF ORAL JUDGMENT This appeal by the claimant is directed against the judgment and award dated 09.09.2020 in M.V.C.No.39/2009 passed by the Senior Civil Judge and JMFC at K.R. Pet (herein after referred as 'Tribunal') on the quantum as well as on liability. Brief facts leading to the filing of the present appeal are as follows: 2. The date of accident, involvement of vehicle and injury sustained by the appellant are not in dispute. The only question on which this appeal is filed before this Court is fastening liability on the owner of the vehicle on account that the driver of the tractor was holding learner's - 3 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 license and driving without instructions from the licensed driver as contemplated under Rule 3(1) of the Central ernment Motor Vehicle Rules, 1989 which reads as under, "3. General:- The provisions of sub-section (1) of section 3 shall not apply to a person while receiving instructions or gaining experience in driving with the object of presenting himself for a test of competence to drive, so long as- (a) such person is the holder of an effective learner's licence issued to him in Form 3 to drive the vehicle; (b) such person is accompanied by an instructor holding an effective driving licence to drive the vehicle and such instructor is sitting in such a position to control or stop the vehicle; and (c) there is painted, in the front and the rear of the vehicle or an a plate or card affixed to the front and the rear, the letter "L" in red on a white background as under: L Note:-The painting on the vehicle or on the plate or card shall not be less than 18 centimetres squares and the letter "L" shall not be less than 10 centimetres high, 2 centimetres thick and 9 centimetres wide at the bottom: - 4 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 Provided that a person, while receiving instructions or gaining experience in driving a motorcycle (with or without a side-car attached), shall not carry any other person on the motorcycle except for the purpose and in the manner referred to in clause (b)" 3. Heard Sri P. Nataraju, learned counsel appearing for the appellant and Sri B. Pradeep, learned counsel appearing for respondent No.2-Insurance Company. Respondent No.1 though served remained absent. 4. Sri P. Nataraju, learned counsel for the appellant vehemently submitted that the Tribunal has not considered the judgment of three Judge Bench of the Hon'ble Apex Court in the case of Pappuu and Others vs. Vinod Kumar Lamba and Another in Civil Appeal No.20962/2017 decided on 19.01.2018 wherein Hon'ble Apex Court following the judgment in the case of National Insurance Co.Ltd. vs. Swarn Singh and - 5 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 Others1 particularly at paragraph No.14 has held as under, "14. The next question is: whether in the fact situation of this case the insurance company can be and ought to be directed to pay the claim amount, with liberty to recover the same from the owner of the vehicle (respondent No.1)? This issue has been answered in the case of National Insurance Company Ltd. (supra). In that case, it was contended by the insurance company that once the defence taken by the insurer is accepted by the Tribunal, it is bound to discharge the insurer and fix the liability only on the owner and/or the driver of the vehicle. However, this Court held that even if the insurer succeeds in establishing its defence, the Tribunal or the Court can direct the insurance company to pay the award amount to the claimant(s) and, in turn, recover the same from the owner of the vehicle. The three-Judge Bench, after analysing the earlier decisions on the point, held that there was no reason to deviate from the said well-settled principle. In paragraph 107, the Court then observed thus: “We may, however, hasten to add that the Tribunal and the court must, however, exercise their jurisdiction to issue such a direction upon consideration of the facts and circumstances of each case and in the event such a direction has been issued, despite arriving at a finding of fact to the effect that the insurer has been able to establish that the insured has committed a breach of contract of insurance as envisaged under sub- clause (ii) of clause (a) of sub-section (2) of Section 149 of the Act, the insurance company shall be entitled to realize the awarded amount 1 reported in (2004) 3 SCC 297 - 6 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 from the owner or driver of the vehicle, as the case may be, in execution of the same award having regard to the provisions of Sections 165 and 168 of the Act. However, in the event, having regard to the limited scope of inquiry in the proceedings before the Tribunal it has not been able to do so, the insurance company may initiate a separate action therefor against the owner or the driver of the vehicle or both, as the case may be. Those exceptional cases may arise when the evidence becomes available to or comes to the notice of the insurer at a subsequent stage or for one reason or the other, the insurer was not given an opportunity to defend at all. Such a course of action may also be resorted to when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage.” Further, in paragraph No.110, the Court observed thus: 110. The summary of our findings to the various issues as raised in these petitions are as follows: (i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object. (ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a) (ii) of the said Act. (iii) The breach of policy condition, e.g. disqualification of driver or invalid driving licence - 7 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 of the driver, as contained in Sub-section (2)(a)(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time, (iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof where for would be on them. (v) The court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case. (vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/ are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under Section 149(2) of the Act. - 8 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 (vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver, (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case. (viii) xxx (ix) xxx (x) Where on adjudication of the claim under the Act the tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of Section 149(2) read with Sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third party under the award of the tribunal Such determination of claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by Sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the tribunal. (xi) The provisions contained in Sub-section (4) with proviso thereunder and Sub-section (5) which are intended to cover specified contingencies mentioned therein to enable the insurer to recover amount paid under the contract of insurance on behalf of the insured can be taken recourse of by the Tribunal and be extended to claims and defences of insurer against insured by, - 9 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 relegating them to the remedy before, regular court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims.” (emphasis supplied)" 5. Sri P. Nataraju, learned counsel for the appellant submits that in view of the law laid down by the Hon'ble Apex Court the liability on the owner of the vehicle is modified directing the insurance company primarily to pay the compensation and recover the same from the owner. So far as quantum of compensation is concerned. He further submits that the appellant has sustained mild head injury and type III A fracture of both bones of the right leg. She has spent sum of Rs.1,25,000/- towards the medical expenses. She has produced total 39 medical bills marked as Ex.P9 to Ex.P15. The bills produced by her for a sum of Rs.92,012/- and she was inpatient for a period of 11 days and underwent operation for fixing of implants. The Tribunal has failed to consider the award in proper compensation towards food, conveyance and attendant charges, loss of income during laid up period - 10 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 loss of amenities and sought to enhance the compensation by suitable modification. 6. Sri B. Pramod, learned counsel for respondent No.2 vehemently submitted that the driver of the tractor was driving having learner license without there being an instructor ought not to have driven the vehicle, which has caused the accident and injuries to the appellant. 7. In view of violation of policy conditions the Tribunal rightly fastening the entire liability on the owner of the vehicle. However, he is not disputing the law laid down by the Hon'ble Apex Court. So far as quantum is concerned, he submits that the Tribunal after taking into consideration the entire facts and circumstances of the case awarded proper compensation which does not call for any interference at the hands of this Court. 8. Having heard the learned counsel appearing for the parties and perused the records. - 11 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 9. The points which arise for my consideration is as follows, i. Whether the Trial Court is justified in fastening the liability on the owner of the vehicle and exonerating the insurance company? ii. Whether the judgment and award passed by the Tribunal requires any modification and enhancement? My answer to the above two points for consideration are partly affirmative. 10. In view of the law laid down by the Hon'ble Apex Court, the appellant being a third party though there are violation of policy conditions that is disqualification of driver or invalid driving license of the driver, as held by the Hon'ble Apex Court at paragraph No.110 which I have extracted above, the insurance company is primarily liable to pay the compensation and recover the same thereafter. - 12 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 In view of the judgment of the Hon'ble Apex Court, this Court is of the opinion that the insurance company is directed to pay the compensation primarily with liberty to recover the same from the owner of the vehicle. 11. Accordingly, point No.1 for consideration is answered partly in affirmative. 12. As per Ex.P2-wound certificate the appellant has suffered two injuries that is mild head injury and type III A fracture of both bones of the right leg. The treated doctor who has been examined as CW1 has stated that the disability comes to 5% to the particular limb and also stated that the appellant is suffering from disability which comes into her day to day affairs/activities. 13. Though the Tribunal has considered the case of the appellant for awarding compensation under their pain and agony and medical expenses, loss of future income and future medical expenses. However, this Court is of the opinion that the compensation awarded under the head - 13 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 food, conveyance and attendant charges, loss of income during the laid up period and under the amenities are at the lower side. It is on record that the appellant was inpatient for a period of 11 days and undergone surgeries for inserting implants. Considering the said facts the compensation awarded under the head food conveyance and attendant charges is enhanced by another Rs.10,000/-, for loss of income during the laid up period considering the fractures suffered by the appellant and the length of treatment taken, age being 50 years at the time of accident, she may be out of work at least for a period of two months. Accordingly, a sum of Rs.13,500/- is awarded in addition to Rs.4,500/-. So far as amenities are concerned, considering the injury and the age of the appellant another Rs.20,000/- is awarded in addition to Rs.10,000/- which has been awarded by the tribunal and on redetermination of the compensation, same comes to as under: - 14 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 SL. NO. Particulars Amount in Rs. 1. Pain and suffering 50,000/- 2. Medical Expenses 92,100/- 3. Food, Conveyance and attendant charges 17,000/- 4. Loss of future income due to disability 29,700/- 5. Loss of income during laid up period 18,000/- 6. Loss of future amenities 30,000/- 6. Future operation 35,000/- Total 2,71,800/- 14. The appellant is entitled for redetermined compensation of Rs.2,71,800/- which would carry an interest at the rate of 6% per annum from the date of petition till realization. 15. Accordingly, I pass the following order, ORDER i) The appeal is allowed-in-part. - 15 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 ii) The compensation award passed by the Tribunal in MVC.No.39/2009 is hereby modified. iii) The insurance company is directed to primarily pay the compensation of Rs.2,71,000/- with interest at the rate of 6% P.a. from the date if petition till realisation and with liberty to recover the same from the owner of the vehicle treating this order as straight away by filing execution on this order. iv) The insurance company is hereby directed to deposit the entire compensation including the compensation awarded by the Tribunal as well as the compensation enhanced in this appeal along with interest at 6% per annum from the date of petition till the realization within a period of Six weeks from the date of receipt of a copy of this order, with aforesaid liberty. - 16 - HC-KAR NC: 2025:KHC:27249 MFA No. 4770 of 2020 v) Entire amount after deposit be released in favour of the appellant on proper identification. Sd/- (T.M.NADAF) JUDGE CR List No.: 1 Sl No.: 35