IN THE HIGH COURT OF KARNATAKA CIRCUIT BENCH AT GULBARGA BEFORE. THE HON BLE Dr.JUSTICE JAWAD RAHIM

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1 1 IN THE HIGH COURT OF KARNATAKA CIRCUIT BENCH AT GULBARGA DATED THIS THE 9 TH DAY OF APRIL, 2013 BEFORE THE HON BLE Dr.JUSTICE JAWAD RAHIM MFA No.6785/2008(WC) CONNECTED WITH MFA No.6786/2008(WC) MFA No.6787/2008(WC) IN MFA No.6785/2008 BETWEEN: THE DIVISIONAL MANAGER THE UNITED INDIA INSURANCE CO. LTD. DIVISIONAL OFFICE V.V.SUKHANI COMPLEX, I FLOOR GANDHI CHOWK, RAICHUR APPELLANT (BY SRI SUDARSHAN.M, ADVOCATE) AND: 1. UCHUNGAPPA S/O DURGAPPA AGED: 45 YEARS OCC: EX. HAMALI R/O KALLI LINGASUGUR LINGASGUR TALUK RAICHUR DISTRICT 2. A. NAGARAJA S/O A. HALAPPA OCC: OWNER OF TRACTOR

2 2 No.KA R/O HEGGADAL VILLAGE KUDLIGI TALUK 3. P. GOVINDA NAIKA S/O P. DHARMA NAIKA OCC: OWNER OF TRAILER No.KA-35-T-4564 R/O HAGARI BOMMANAHALLI TALUK BELLARY DISTRICT... RESPONDENTS (BY SRI MAHADEV S. PATIL FOR R2 & R3) THIS MISCELLANEOUS FIRST APPEAL FILED UNDER SECTION 30(1) OF WORKMEN'S COMPENSATION ACT PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED IN WCA/CR-671/2006 PASSED BY THE LABOUR OFFICER AND COMMISSIONER FOR WORKMEN'S COMPENSATION. IN MFA No.6786/2008 BETWEEN: THE DIVISIONAL MANAGER THE UNITED INDIA INSURANCE CO. LTD. DIVISIONAL OFFICE V.V.SUKHANI COMPLEX, I FLOOR GANDHI CHOWK, RAICHUR APPELLANT (BY SRI SUDARSHAN M., ADVOCATE) AND: 1. G. SOMANNA S/O SHIVALINGAPPA AGED 68 YEARS OCC: EX. HAMALI R/O KALLI LINGASUGUR LINGASUGUR TALUK RAICHUR DISTRICT

3 3 2. A.NAGARAJA S/O A. HALAPPA OCC: OWNER OF TRACTOR No.KA R/O HEGGADAL VILLAGE KUDLIGI TALUK 3. P.GOVINDA NAIKA S/O P. DHARMA NAIKA OCC: OWNER OF TRAILER No.KA-35-T4564 R/O HAGARI BOMMANAHALLI TALUK BELLARY DISTRICT... RESPONDENTS (BY SRI MAHADEV S. PATIL, ADVOCATE FOR R2 & R3, R1-NOTICE H/S V/O DT ) THIS MISCELLANEOUS FIRST APPEAL FILED UNDER SECTION 30(1) OF WORKMEN'S COMPENSATION ACT PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED IN WCA/CR-672/2006 PASSED BY THE LABOUR OFFICER AND COMMISSIONER FOR WORKMEN'S COMPENSATION, RAICHUR. IN MFA No.6787/2008 BETWEEN: THE DIVISIONAL MANAGER THE UNITED INDIA INSURANCE CO. LTD. DIVISIONAL OFFICE V.V.SUKHANI COMPLEX, I FLOOR GANDHI CHOWK, RAICHUR APPELLANT (BY SRI SUDARSHAN M., ADVOCATE) AND: 1. CHAKERI DURGAPPA S/O GANGAMMA AGED 35 YEARS OCC: EX. HAMALI R/O KALLI LINGASUGUR

4 4 LINGASUGUR TALUK RAICHUR DISTRICT 2. A.NAGARAJA S/O A. HALAPPA OCC: OWNER OF TRACTOR No.KA R/O HEGGADAL VILLAGE KUDLIGI TALUK 3. P.GOVINDA NAIKA S/O P.DHARMA NAIKA OCC: OWNER OF TRAILER No.KA-35-T-4564 R/O HAGARI BOMMANMAHALLI TALUK BELLARY DISTRICT... RESPONDENTS (BY SRI MAHADEV S. PATIL, ADVOCATE FOR R2 & R3) THIS MISCELLANEOUS FIRST APPEAL FILED UNDER SECTION 30(1) OF WORKMEN'S COMPENSATION ACT PRAYING TO SET ASIDE THE JUDGMENT AND ORDER DATED IN WCA/CR-673/2006 PASSED BY THE LABOUR OFFICER AND COMMISSIONER FOR WORKMEN'S COMPENSATION, RAICHUR. THESE APPEALS COMING ON FOR ORDERS THIS DAY, THE COURT DELIVERED THE FOLLOWING:- JUDGMENT These three appeals are by the insurance company against the award in favour of claimants questioning the liability as also the quantum.

5 5 2. Heard Sri Sudarshan M., learned counsel for the appellant, learned counsel for the respondents/claimants and perused the records in supplementation thereto. 3. The genesis of these appeals is the motor vehicle accident on involving tractor and trailer bearing registration Nos.KA and KA-35-T-4564 in which persons carried in the trailer suffered injuries and laid claim placing actionable and culpable negligence in driving of the tractor owned by the first respondent in the claim petition. Owner of the trailer was brought into party array as respondent No.2 and insurer as respondent No The claimants assertively contended they were employed by the owner of the trailer to work as loader and during the course of such employment they were made to carry tamarind the agricultural produce to a defined destination, enroute the tractor driver drove it rashly and negligently resulting in accident in which they suffered injuries. Thus, they sought compensation for pecuniary and non-pecuniary loss through their claims filed under the

6 6 provisions of Workmen's Compensation Act before the Commissioner for Workmen's Compensation. 5. In the enquiry that ensued, the Commissioner for Workmen's Compensation keeping in mind the defence of the insurance company that persons who lodged claims were not the employees of the owner of the tractor, analyzed the evidence but rejected such defences. Secondly, the insurance company assertively resisted the claims on the ground the policy is miscellaneous agricultural policy provided to cover only risk as defined under the policy in relation to agricultural work and no other. However, the learned Commissioner has opined the evidence establishes firstly culpable negligence of the driver of the trailer and secondly that claimants were coolies/loaders employed by the owner of the trailer. Therefore, he quantified the compensation depending on each victims injuries and the pecuniary and non-pecuniary loss suffered and passed the award.

7 7 6. All the three awards are assailed by the insurance company in these appeals filed under Section 30 of the Workmen's Compensation Act. Firstly, it must be noticed the appeal under Section 30 is permissible only when substantial question of law is raised for an answer and not on facts. Be that as it may, appeals were admitted and taken up for final disposal. 7. Learned counsel referred to the policy of the insurance issued by the appellant which undoubtedly show the premium collected by the insurance company is more than the basic premium prescribed for the tractor as well as trailer. In the circumstances, I had directed insurance company to furnish the details as to cover which risk the insurance company had collected extra amount more than the basic premium. This was necessitated as the policy contained no material information as to the risk covered except showing high premium collected. 8. In response to such direction, learned counsel has filed a memo showing braking up all the amount

8 8 collected and has also produced the supplementary policy showing what was collected. The appellant has collected Rs.1,397/- also and supplementary policy shows it is in addition to what the premium was collected earlier. There is again no details mentioned regarding collection of Rs.1,397/-. On the face of it, the policy is a contractual policy falling under sub-section (5) of Section 147 of the motor vehicles Act and not a case falling under sub section (1) of Section 147 granting only statutory insurance cover. The policy issued is a package policy in view of such high premium collected. 9. The second ground urged by the learned counsel is, on facts, claims were untenable as the claimants were carried as passengers by contravention of the permit granted by the RTO. Since the insurance company had described them as passengers necessarily we have to look for the evidence on record from which no material has been salvaged by the insurance company to support the defence. Each of the claimants has categorically deposed

9 9 that he or she was the coolie carried in a trailer for the loading and unloading of Tamarind. That assertive statement of claimants has remained undisturbed despite all the defence of insurance company. There is no independent evidence apart from what is referred to above. The ocular testimony of the claimants has established claimants were carried in the trailer for loading and unloading. Thus statutorily covered under Section 147 of the Act. This takes us to the next question raised by the insurance company i.e., even presuming they were loaders, miscellaneous agricultural policy does not cover the risk of such loaders. 10. Learned counsel placed reliance on the decision of this Court in the case of DIVISIONAL MANAGER v. AKKAVVA reported in LAWS(KAR) equivalent to ILR(KAR) , wherein learned single Judge of this Court opined that miscellaneous agricultural policy does not cover the risk of employees who were employed as loaders or coolies in the trailer or

10 10 tractor. Basis for such opinion is found in paragraph 5, wherein it is observed: 5. It is not in dispute that the policy in question which has been marked as Ex.R1 in the evidence of R.W.1 is a farmer s package insurance policy. It is also not in dispute that the said Ex.R1 does not cover the risk of any coolie as such and it only covers the risk of the insured himself and his vehicle, i.e., the tractor cum trailer as well as the risk in respect of building of Class-A constructions and the contents excluding jewellery and valuables. Therefore, having regard to the nature of the policy taken out by the insured and the said policy being the standard policy forming the basis of contract between the insured and the insurance company, the question for consideration will be whether the said policy covers the risk of the two claimants herein who were found travelling with several other persons in the trailer in question on the date of the accident. 11. In paragraph 6, the learned Judge has referred to the fact that insurance company had not collected any

11 11 additional premium. Therefore, on facts also that decision will not apply as in this case insurance company has collected a very heavy premium as referred to supra. 12. However, the final opinion expressed by the learned Judge is in paragraphs 9 and 12, wherein it has observed thus: 9. Concerning the submission of the learned senior counsel that the evidence of RW1 should not be looked into because it is in violation of Order 18 Rule 4 of the CPC, I do not find any merit in the said ground urged because not only RW1 has been examined before the mact, but even the claimants have given their evidence by way of affidavit so far as examination-in-chief is concerned. It is, therefore, not possible to ignore the evidence of RW1, but accepted the evidence of the claimants though they also give evidence by way of affidavit. The learned senior counsel also referred to the evidence of RW1 in regard to which the Tribunal has observed in paragraph No.12 of its order that since Ex.R1 is the farmer s package insurance and the

12 12 same being comprehensive policy, the coolies travelling in the tractor-trailer are covered under the said insurance policy. Having carefully examined the evidence of RW1, I do not find any such statement being made by RW1 in the course of his evidence and therefore, the said observation of the Tribunal is wholly incorrect. 12. In this connection, it is pertinent to refer to the decision of this Court in the case of UNITED INDIA INSURANCE COMPANY limited vs. HANUMANTHAPPA AND OTHERS. In the said decision, it has been held that there is no statutory liability on the part of the insurer to cover the risk of all types of employees of the insured owning a motor vehicle, but only such of those employees within the meaning of workmen under the W.C. Act will have to be covered compulsorily. Therefore, the employees who are employed in connection with the motor vehicle as defined under Section 2 (n) will have the benefit of statutory coverage and the court also further held that on fact as the deceased and insured were not the employees employed in connection with

13 13 the motor vehicle, but employed for agricultural work, the award against the insurer is bad in law. While laying down the above law, this court also placed reliance on the decision of the Apex Court in NATIONAL INSURANCE COMPANY limited vs. V. CHINNAMMA AND OTHERS (SUPRA). ILR 2006 Karnataka Yet another decision referred to by the learned counsel for the claimants concerning Section 39 of the M.V. Act has no application to the case on hand for the reasons already stated, as we are concerned with a motor vehicle which is insured under the farmer s package policy and meant for agricultural purposes only, the use of the said tractor-cumtrailer to carry number of persons who are going for coolie work therefore, is contrary to the very purpose for which the policy was issued. Thus, to conclude, the policy in question that is Ex.R1 is a policy in the nature of farmer s package policy insurance, covering the risk of only those persons mentioned in the policy and the said vehicle was used in

14 14 contravention of Section 66 of the Motor Vehicles Act. 13. It is evident from the decision on facts in that case it is held that employees like loaders and coolies are held not covered statutorily. Reference is made to section 2(n) of the Workmen's Compensation Act. Firstly, the definition of workman in Section 2(n) of the Workmen's Compensation Act as it was in the book of statute has since been omitted by amendment to the Workmen's Compensation Act by Act 45 of 2009 which has came in effect on However, for clarity, it is necessary to refer to Section 2(n), which reads thus: The workman is defined in Section 2(n) of the Workmen's Compensation Act as a person recruited as driver, helper, mechanic cleaner or in any other capacity in connection with a motor vehicle. 14. However, it is necessary to notice, even Section 2(n) by virtue of amendment Act 30 of 1996 with effect from (a) was introduced whereby person

15 15 recruited as driver, helper, mechanic, cleaner or in any other capacity in connection with the motor cycle are covered. After repeal of Section 2(n) of the Act, Section 2 (1)(dd) is inserted. Section 2(i)(c). A person recruited as driver, helper, mechanic, clearer or in any other capacity in connection with the motor vehicle. 15. This undoubtedly includes all or any other employees of the insured who are employed in connection with motor vehicle and works under his direction, carried in the vehicle to do a work in relation to vehicle in question. In the instant case, claimants claim they were coolies employed to load and unload agriculture produce in the trailer and therefore, it has to be held such persons were employed in connection with the vehicle insured. Once we held them as such, Section 147 of the Motor Vehicles Act is attracted. Section 147 of M.V. Act provides statutory cover to certain category of persons and as

16 16 defined under Section 147(i) of M.V. Act. The proviso reads thus: 147. Requirements of Policies and limits of liability: 1).. Provided that a policy shall not be required (i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen's Compensation Act, 1923 (8 of 1923) in respect of death of, or bodily injury to, any such employee (a) (b) (c) engaged in driving the vehicle, or if it is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicle, or if it is a goods carriage, being carried in the vehicle,

17 The category of persons referred to is employee as defined in the Workmen's Compensation Act. Now definition of workman having been removed from the book of statute, the provisions of Section 2(dd) defines employee. He is automatically covered under the provisions of the Employee s Compensation Act, 1923 which is Workmen's Compensation Act amended in 2009 and the insurer is bound to cover the risk even if it has collected only basic premium. This is statutory coverage provided under Section 147 and therefore, even if we hold that the policy is only the act policy, it binds the insurer to indemnify the insured. Besides, as insurer has collected extra premium, the policy has transformed into contractual policy covered by sub-section 5 of Section 147 of the Motor Vehicles Act, which reads thus. 147(5). Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in

18 18 the policy in respect of any liability which the policy purports to cover in the case of that person in the case of that person or those classes of persons. 17. The insurance company has issued cover to indemnify the person insured i.e., owner of the trailer against all his legal liability. As the claim is against the owner, in view of Section 5 having collected extra premium, insurance company is bound to indemnify him. 18. In this view, there is no merit in the appeals and each. NB* the appeals are dismissed with the cost of Rs.5,000/- Sd/- JUDGE