LexNATIONAL INSURANCE CO. LTD. versus LAXMI NARAIN DHUT
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NATIONAL INSURANCE CO. LTD. A v. LAXMI NARAIN DHUT MARCH 2, 2007 [DR.ARIJITPASAYAT AND S.H. KAPADIA,JJ.] B Motor Vehicles Act, 1988: Sections 147 and 149. Motor vehicles-Insurance-Third party claims-Principles laid down in Swaran Singh's case (2004) 3 SCC 297-Applicability of-Held: The C decision in Swaran Singh's case has no application to cases other than third party risks-It has no application to own damage cases-Where originally the license was a fake one, renewal cannot cure the inherent fatality-In case of third party risks the insurer has to indemnify the amount and, if so advised, to recover the same from the insured Interpretation of Statutes: Purposive interpretation-Applicability of S. I 49 of the Motor Vehicles Act, I 988-Held: A statute is an edict of the Legislature and in construing D a statute, it is necessary to seek the intention of its maker-The concept of E purposive interpretation has no application to cases relatable to Section 149 of the Act. In these appeals the applicability of the decision of this Court in National Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 even to claims other than third party claims is in issue. F Allowing the appeals, the Court HELD: I. The terms of the policy have to be construed as it is and there is no scope for adding or subtracting something. However liberally the policy may be construed, such liberalism cannot be extended to permit substitution G · of words which are not intended. (Para 18] (594-F-G) United India Insurance Co. Ltd v. Harchand Rai Chandan Lal, (2004) 8 SCC 644 and Polymat India (P) Ltd. v. National Insurance Company Ltd., 579 H 580 SUPREME COURT REPORTS [2007) 3 S.C.R. A [2005) 9 sec 174, relied on. -: In Re: Harrington Motor Co. ex-parte Chaplin (1928) Ch 105 C.A. and Hoods' Trustees v. Southern Union Insurance Co. of Australasia Ltd., (1928) Ch 793, referred to. B 2. Where the claim relates to own damage claims, it cannot be adjudicated by the insurance company. But it has to be decided by another forum i.e. forum created under the Consumer Protection Act, 1985. Before the Motor Accidents Claims Tribunal, there were essentially three parties ... i.e. the insurer, insured and the claimants. On the contrary, before the c consumer forums there were two parties i.e. owner of the vehicle and the insurer. The claimant does not come into the picture. Therefore, these are cases where no third party was involved. [Para 21) (595-D) 3. There is no contractual relation between the third party and the insurer. Because of the statutory intervention in terms of Section 149 of the D Motor Vehicles Act, 1988, the same becomes operative in essence and Section 149 provides complete insulation. [Para 23) [595-F] 4. In the background of the statutory provisions, one thing is crystal clear i.e. the statute is a beneficial one qua the third party. But that benefit cannot be extended to the owner of the offending vehicle. The logic of fake E license has to be considered differently in respect of third party and in respect of own damage claims. [Para 24) (595-GJ Complete Insulations (P) Ltd. v. New India Assurance Co. Ltd., [1996] 1 sec 221, relied on. F 5. ''Golden Rule" of interpretation of statutes is that statutes are to be interpreted according to grammatical and ordinary sense of the word in r grammatical or liberal meaning unmindful of consequence of such interpretation. It was the predominant method of reading statutes. More often than not, such grammatkal and literal interpretation leads to unjust results which the Legislature never intended. The golden rule of giving undue G importance to grammatical and literal meaning of late gave place to 'rule of legislative intent'. The world over, the principle of interpretation according to the legislative intent is accepted to be more logical. r '- ~ [Para 28[ [597-H; 598-A-BJ 6. When the law to be applied in a given case prescribes interpretation H of statute, the Court has to ascertain the facts and then interpret the law to NATIONAL INSURANCE CO.LTD. v. LAXMI NARAIN DHUT 581 --,.. ·. apply to such facts. Interpretation cannot be in a vacuum or in relation to A hypothetical facts. It is the function of the legislature to say what shall be the law and it is for only the Court to say what the law is. (Para 29) [598-C) JT. Registrar of Co-op Societies v. T.A. Kuttappan, [2000) 6 SCC 127, Associated Timber Industries v. Central
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