Pre-emptory compensation award u/s 92A of Motor Vehicles Act

There is a proviso added to this section by amendment of 1982 and it says that where such application makes a claim for compensation u/s 92A in respect of the death or permanent disablement of any person, such claim and any other claim (whether made in such application or otherwise) for compensation in respect of such death or permanent disablement shall be disposed of in accordance with the provisions of Chapter VII-A.

Thus it is clear from this legislation that a separate application u/s 92A can be filed and a separate claim u/s 110A can also be filed by the claimants. As mentioned above, to give expeditious relief Section 92A has been enacted and according to this section on a principle of no fault, a compensation is to be granted to the claimant as first mentioned compensation. The point is that u/s 92A only the owner is liable to make this compensation or the Insurer is also liable. If the vehicle is insured and the Insurer is liable to the extent to which the vehicle is insured. So the Insurance Company can also be saddled with the liability u/s 92A of the Act keeping in view the provisions of Section 96 which says that it is the duty of the insurers to satisfy demands against persons insured.

This matter has also been examined in the case of Mahaveer Prasad v. Manmohan (1986) 2 JS 521. This is the decision of our High Court where the question was whether the Insurance Company can be made liable for payment of the interim compensation u/s 92A. In this case it has been observed as under : —

“Having regard to the provisions contained in Sections 92A, 95, 96 and 110B, the insurance company is liable for specifying the compensation claimed, arising from the accident by the insured vehicles in accordance with the terms of Section 95. In this view of the matter, to the extent of the policy, which covers the risk without enquiry as to whether the amount awarded is u/s 92A of the Act or is otherwise, the insurance company is liable to pay the amount awarded. The Tribunal was not right in holding that in terms of Section 92A of the Act, the owner is only liable.

The case of Oriental Fire and General Insurance Co. Ltd. Goa Vs. Aleixo Fernandes and others, is also with regard to this very aspect and where a claim is u/s 92A it has been held that the Insurer is liable to pay pre-emptory compensation award u/s 92A.

 Thus the intention of the legislation at the time of amending the Motor Vehicles Act in the year 1982 is clear that interim relief is to be given to the claimant u/s 92A and this can be awarded against the owner as well as the Insurance Company. In the present case the owner has raised an objection before the Tribunal that Insurance Company is necessary party and it should be impleaded as party. At that time the claimant should have requested the Court to implead the Insurance Company as party in the claim and after hearing it the Tribunal should have decided the matter. When it was brought to the notice of the Tribunal that in a claim u/s 92A the Insurer is also liable to make pre-emptory compensation it was incumbent on the Tribunal to implead the Insurance Company as party. The claimant have also not requested the Court to make the Insurer party in this claim. So without calling a party no order could be passed. The Tribunal had passed Award only against Mohanlal, the appellant who is the owner of the vehicle. The Insurance Company, respondent 1 has not been made party and no award has been passed against it. In the appeal notice has been issued to respondent 1, Insurance Company and their objection that unless the Company is party in the claim before the Tribunal, no appeal lies against it and the appeal is not maintainable. This objection raised by Shri Bhansali has force and I agree with him. When respondent 1, the Insurance Company, was not made party in the original claim u/s 92A of the Act, when no award has been passed against it, no appeal lies against the Company. But as Section 92A makes liable the Insurer also, so in the interest of justice I feel that the order of the Tribunal be set aside and the matter be remanded back to the Tribunal after making the National Insurance Company as party to the claim and after giving opportunity to the Insurance Company to decide the claim afresh. As there is objection raised by the owner before the Tribunal the claimant should move an application before the Tribunal to implead National Insurance Company as party to the claim and after giving notice to the Company the matter be decided afresh.

Condition that High Courts and Supreme Court in exercise of their jurisdictions under Articles 226 and 32 can award compensation for such violations but such a power should not be lightly exercised.

Supreme court in Rajender Singh Pathania and Others Versus State of N.C.T. of Delhi and Others [ JT 2011 (10) SC 294 : (2011) 9 SCALE 124]

The issue of award of compensation in case of violation of FUNDAMENTAL RIGHTS of a person has been considered by this Court time and again and it has consistently been held that though the High Courts and Supreme Court in exercise of their jurisdictions under Articles 226 and 32 can award compensation for such violations but such a power should not be lightly exercised. These Articles cannot be used as a substitute for the enforcement of RIGHTS and obligations which could be enforced efficaciously through the ordinary process of courts. Before awarding any compensation there must be a proper enquiry on the question of facts alleged in the complaint. The court may examine the report and determine the issue after giving opportunity of filing objections to rebut the same and hearing to the other side. Awarding of compensation is permissible in case the court reaches the same conclusion on a re-appreciation of the evidence adduced at the enquiry. Award of monetary compensation in such an eventuality is permissible “when that is the only practicable mode of redress available for the contravention made by the State or its servants in the purported exercise of their powers.”

(Vide: Sebastian M. Hongray v. Union of India AIR 1984 SC 1026; Bhim Singh, MLA v. State of J and K and Ors., AIR 1986 SC 494; Smt. Nilabati Behera v. State of Orissa and Ors., AIR 1993 SC 1960; D.K. Basu v. State of W.B., AIR 1997 SC 610; Chairman, Railway Board and Ors. v. Mrs. Chandrima Das and Ors., AIR 2000 SC 988; and S.P.S. Rathore v. State of Haryana and Ors., (2005) 10 SCC 1).

18. In Sube Singh v. State of Haryana and Ors., AIR 2006 SC 1117, while dealing with similar issue this Court held as under:

In cases where custodial death or custodial torture or other violation of the RIGHTS guaranteed under Article 21 is established, the courts may award compensation in a proceeding under Article 32 or 226. However, before awarding compensation, the Court will have to pose to itself the following questions: (a) whether the violation of Article 21 is patent and incontrovertible, (b) whether the violation is gross and of a magnitude to shock the conscience of the court, (c) whether the custodial torture alleged has resulted in death….. Where there are clear indications that the allegations are false or exaggerated fully or in part, the courts may not award compensation as a public law remedy under Article 32 or 226, but relegate the aggrieved party to the traditional remedies by way of appropriate civil/criminal action.

(See also: Munshi Singh Gautam (D) and Ors. v. State of M.P., AIR 2005 SC 402; and Bharat Amratlal Kothari v. Dosukhan Samadkhan Sindhi and Ors., AIR 2010 SC 475).

 

United Air Travel Services through its Proprietor A.D.M. Anwar Khan Vs. Union of India through Secretary (Ministry of External Affairs) [ALL SC 2018 MAY]

KEYWORDS:-Private Tour Operators-Quota for the Hajj-Hajj policy-

supreme court of india 1

DATE:-May 07, 2018

“It was also emphasized that it is a sound policy to punish the wrongdoer and it is in that spirit that the courts have molded the relief by granting compensation in exercise of writ jurisdiction”.

SUPREME COURT OF INDIA

United Air Travel Services through its Proprietor A.D.M. Anwar Khan Vs. Union of India through Secretary (Ministry of External Affairs)

[Writ Petition (Civil) No.631 of 2016] [Writ Petition (Civil) No.636 of /2016]

[Writ Petition (Civil) No. 634 of 2016] [Writ Petition (Civil) No. 934 of 2016]

[Writ Petition (Civil) No. 941 of 2016] [Writ Petition (Civil) No. 938 of 2016]

[Writ Petition (Civil) No. 11 of 2017] [Writ Petition (Civil) No. 94 of 2017]

SANJAY KISHAN KAUL, J.

1. A batch of writ petitions raises the issue of Private Tour Operators (for short ‘PTOs’) who are, inter alia conducting the travel business for Hajj and Umrah being disqualified for grant of registration for the year 2016 for the Hajj pilgrimage. The prayer is for quashing the identical communications dated 27.7.2016 issued by the respondent rejecting the application of the petitioners for registration and allocation of quota for the Hajj 2016 on the ground that they have not complied with certain clauses of the policy for the PTOs as laid down by this Court.

2. The issue relating to the Hajj policy and the registration of these PTOs has resulted in two judicial pronouncements by this Court in Union of India v. Rafique Shaikh Bhikan1 and Al Ismail Haj Tour v. Union of India2. The policy presented on behalf of the Government was approved by this Court with slight modifications and was annexed as Appendix-I to the order in Union of India v. Rafique Shaikh Bhikan3 case referred to aforesaid to be called as ‘Policy for Private Tour Operators for hajj 2013 – 2017’.

The policy was to remain valid for a period of five years and was not to be questioned in any court or authority. The petitioners were all eligible to be qualified as PTOs for the year 2015 for Hajj pilgrimage but in the process of draw of lots dated 7.8.2015, luck did not favour them and they thus did not get quota. The relevant extract of the policy is as under:

“Appendix I

Ministry of External Affairs

(Gulf and Haj Division)

***

Registration of Private Tour Operators – Haj 2013

The Government of Saudi Arabia has notified that Private Tour Operators (PTOs) registered with the Government of India and involved in the preparation of the Haj Pilgrimage will be eligible for grant of Haj group visas subject to fulfilment of other terms and conditions as laid down by the Saudi Authorities.

2. Applications are invited from eligible PTOs for registration for Haj 2013. The eligibility criteria are at Annexures A and B. The applications must be submitted in the prescribed format (Annexure C) directly to MEA or any other agency appointed by it.

3. It is to be noted that the Government of Saudi Arabia has stipulated that effective Haj 2013, a PTO should facilitate at least 150 pilgrims. Accordingly, the PTO Policy has been reframed. For registration and allotment of quota of Haj seats for Haj 2013, interested PTOs may apply under the following two categories:

Category I

PTOs registered with MEA and facilitated Hajis at least for 7 Haj operations or more.

Category II

PTOs registered with MEA and facilitated Hajis for at least for 1 to 6 Haj operations and PTOs which have facilitated at least 50 umrah pilgrims in a year for any five years.

4. 70% of the overall quota of seats will be allocated to eligible PTOs under Category 3(I) and 30% to eligible PTOs under Category 3(II). Distribution of seats among qualified PTOs will be done as follows:

(a) 70% of the Haj 2013 PTO seats (31,500) will be allocated to eligible PTOs under Category 3(I) at the rate of 150 seats per PTO. In case the number of PTOs exceeds 210, the allocation of seats will be done on draw of lots. If the number of qualified PTOs is less than 210, each PTO will be allocated 150 seats and surplus seats, if any, will be distributed equally among them.

(b) 30% of Haj 2013 PTO seats (9000) will be allocated to eligible PTOs under Category 3(II) at the rate of 150 seats per qualified PTO. If the number of qualified PTOs exceeds 90, the allocation of seats will be done by draw of lots. In case the number of PTOs is less than 90, each PTO will be allocated 150 seats. Balance seats, if any, will be transferred to Category I and distributed equally among them. A qualified PTO which fails to get selected under the draw of lots in any year will be allocated 150 seats in the ensuing year without qurrah if it remains a qualified PTO.

5. This Policy is expected to remain valid for five years 2013- 2017 unless there are substantive developments which affect it. The allocation of seats to qualified PTOs in each category will be done every year on the basis of the overall quota of PTO seats specified in the Annual India-Saudi Arabia Haj Agreement and the number of qualified PTOs remaining in each category. The policy envisages cross-category upward movement of PTOs from Category II to Category I. A qualified PTO shall remain qualified unless it is otherwise disqualified either by the Government of India or by the Government of Saudi Arabia for valid reasons. It is to be noted that the PTOs who do not wish to take a minimum of 150 Hajis or are unable to do so, need not apply.

6. Last date for receipt of applications which should be addressed to the MEA or any other agency appointed by it.

(emphasis supplied)

3. In terms of the aforesaid policy since the qualified PTOs exceeded 90, a draw of lots was held. Further, since the petitioners were not successful in the draw of lots, they were entitled, under clause 4(b) of the policy aforesaid, to be allocated 150 seats in the ensuing year without Qurrah if they remain qualified as PTOs. We may note at this stage that as per the submissions advanced, in view of certain changes in the policy of the Saudi Government, the number of seats to be allocated for 2016 would have been 50.

4. It is also apparent from the Press Release of 7.8.2015 giving the list of PTOs who have qualified but did not get quota, that the petitioners figured in the said list.

5. On 29.4.2016, the Ministry of External Affairs published the norms for registration of PTOs for Hajj 2016. Para 3 of this reads as under:

“3. All the terms and conditions laid down in Annexure A & B will also apply on PTOs that qualify under Category-II by virtue of facilitating a minimum of 50 Umrah pilgrims in a year for any 5 years, but with the exception of the terms and conditions contained under Clause (vii), (x), (xi) and (xii) of Annexure A. In addition, these PTOs are also required to submit the proof of payment made through banking or any other authorised channels towards purchase of tickets and hiring of accommodation in Makkah and Madinah in respect of Umrah pilgrims facilitated by them in support of their claim.”

6. The aforesaid, thus, provided that persons like the petitioners who had qualified for the year 2015 but were not successful in the draw of lots would have the benefit of exemption of terms and conditions contained in clauses (vii), (x), (xi) and (xii) of Annexure A.

7. For purposes of completion of record, we enumerate hereinbelow the said clauses of Annexure A:

“ANNEXURE-A

Terms and Conditions for Registration of Private Tour Operators (PTOs) for Haj-2016

Each PTO should establish that it is a genuine and established Tour Operator having experience in sending tourists/pilgrims abroad for which it should produce the following documents:

Sl. No.

Terms and Conditions

Vii

Proof of payment made through banking (Bank Statement) or other authorized channels towards purchase of tickets and hiring of accommodation in Makkah/Madinah for the financial year 2013-14 (Haj2013) or 2014-15 (Haj 2014).

Payments towards purchase of tickets, hiring of accommodation for pilgrims in Makkah/Madinah, by any other means, would not be accepted.

x

Copies of Registration Certificate issued to the PTO in support their aim-wise and PTO-wise.

Xi

Contract for hiring of buildings for pilgrims and “Tasreeh” together with English translations PTO category wise. (Please enclose rental receipts and a copy of lease deed, duly signed with the Saudi owners for Haj.

Xii

Copy of Munazzim Card and relevant Haj visa pages of the Passport of the Proprietor/Owner.

8. The petitioners, however, faced identical rejection letters of 26.7.2016 (sent through e-mail dated 27.7.2016), the contents of which are as under:

“Subject: Intimation regarding non-allocation of quota to Private Tour Operators (PTOs) for Haj-2016.

Dear Sirs,

This has reference to your application regarding registration for Haj 2016.

2. On scrutiny of your application submitted for Haj-2016, your firm has not been found eligible for registration and allocation of quota for Haj 2016 on the following grounds:

PTO has not complied with clause vii, x, xi and xii of Annexure A of PTO. Policy as laid down by Hon’ble Supreme Court for any one of the Haj year.

3. Your ineligibility for registration and allocation of quota for Haj 2016, however, does not prejudice your right to debar you from applying for registration for Haj 2017 on the basis of the required conditions for Haj 2017.”

9. A bare perusal of the aforesaid letter would show that the reason cited for disqualification was non-compliance of the very clauses of which exemption had been granted to the petitioners.

10. Learned Additional Solicitor General appearing for the respondents could not dispute the aforesaid position but sought to canvas that the reasons were wrongly communicated in the rejection letter, and there was actually, some other reason for the rejection. The aforesaid plea can hardly be countenanced in view of the reasons referred to and communicated.

11. Learned counsel for the petitioner has, thus, rightly drawn our attention to the Constitution Bench judgment of this Court in Mohinder Singh Gill v. Anr. v. The Chief Election Commissioner, New Delhi & Ors.4 to submit that such a plea cannot be accepted.

We may note that this is a well settled legal position in many judicial pronouncements of this Court, but it is not necessary to revert to the same. In para 8 of the aforesaid judgment, V.R. Krishna Iyer, J, in his inimitable style states as under:

“8. The second equally relevant matter is that when a statutory functionary makes an order based on certain grounds, its validity must be judged by the reasons so mentioned and cannot be supplemented by fresh reasons in the shape of affidavit or otherwise. Otherwise, an order bad inthe beginning may, by the time it comes to Court on account of a challenge, get validated by additional grounds later brought out.

We may here draw attention to the observations of Bose, J. in Gordhandas Bhanji: “Public orders, publicly made, in exercise of a statutory authority cannot be construed in the light of explanations subsequently given by the officer making the order of what he meant, or of what was in his mind, or what he intended to do. Public orders made by public authorities are meant to have public effect and are intended to affect the actings and conduct of those to whom they are addressed and must be construed objectively with reference to the language used in the order itself. Orders are not like old wine becoming better as they grow older.”

12. The aforesaid legal position, thus, makes the stand of the respondent unsustainable, resulting in the quashing of the impugned letters of rejection.

13. The question, however, rises what relief can be granted in such a situation. The passage of time has made certain reliefs infructuous. The time period for conducting Hajj tours for 2016 as well as 2017 is over. Thus, even the alternative relief prayed for 2017 has become infructuous. In three of the writ petitions, i.e., WP (C) Nos.631/2016; 634/2016 & 636/2016, there is a specific alternative plea for compensation to the petitioners for the loss accrued due to non-grant of registration for the Hajj of 2016. While there is no such specific plea in the other writ petitions, given the identical situation, we are of the view that the same principle ought to be applied in all these cases. The petitioners cannot be left remediless.

The mindless action of the respondents in rejecting the eligibility of the petitioners for the year 2016 on the very grounds on which they were exempted necessitates that the petitioners should be entitled to damages in public law so that they are compensated, at least, to some extent for not having been able to carry on with their business on account of illegal action of the respondents.

14. The principles of damages in public law have to, however, satisfy certain tests. In Nilabati Behera v. State of Orissa5, it was observed that public law proceedings serve a different purpose than private law proceedings. In that context, it was observed as under: “The purpose of public law is not only to civilize public power but also to assure the citizen that they live under a legal system which aims to protect their interests and preserve their rights. Therefore, when the court molds the relief by granting ‘compensation’ in proceedings under Articles 32 or 226 of the Constitution seeking enforcement or protection of fundamental rights, it does so under the public law by way of penalising the wrongdoer and fixing the liability for the public wrong on the State which has failed in its public duty to protect the fundamental rights of the citizen.

The payment of compensation in such cases is not to be understood, as it is generally understood in a civil action for damages under the private law but in the broader sense of providing relief by an order of making ‘monetary amends’ under the public law for the wrong done due to breach of public duty, of not protecting the fundamental rights of the citizen. The compensation is in the nature of ‘exemplary damages’ awarded against the wrong doer for the breach of its public law duty and is independent of the rights available to the aggrieved party to claim compensation under the private law in an action based on tort, through a suit instituted in a court of competent jurisdiction or/and prosecute the offender under the penal law.”

It was also emphasized that it is a sound policy to punish the wrongdoer and it is in that spirit that the courts have molded the relief by granting compensation in exercise of writ jurisdiction. The objective is to ensure that public bodies or officials do not act unlawfully. Since the issue is one of enforcement of public duties, the remedy would be available under public law notwithstanding that damages are claimed in those proceedings.

15. The aforesaid aspect was, once again, emphasized in Common Cause, a Registered Society v. Union of India6. We may also usefully refer to N. Nagendra Rao & Co. v. State of A.P.7 qua the proposition that the determination of vicarious liability of the State being linked with the negligence of its officer is nothing new if they can be sued personally for which there is no dearth of authority.

16. In the facts of the present case, the arbitrariness and illegality of the action of the authority is writ large. The petitioners have been deprived of their right to secure the quota on a patently wrongful order passed for reasons, which did not apply to them and for conditions, which had been specifically exempted. What could be a greater arbitrariness and illegality? Where there is such patent arbitrariness and illegality, there is consequent violation of the principles enshrined under Article 14 of the Constitution of India. The facts of the present case are, thus, undoubtedly giving rise to the satisfaction of parameters as a fit case for grant of compensation.

17. On a conspectus of the aforesaid facts including the number of pilgrims for whom the petitioners would have been entitled to arrange the Hajj pilgrimage, an amount of Rs.5 lakh per petitioner would be adequate compensation for the loss suffered by them and sub-serve the ends of justice. We are conscious of the fact that there is no quantification based on actual loss, but then the award by us is in the nature of damages in public law.

18. The amount for each of the petitioners be remitted by the respondents within two months from the date of this order failing which the amount would carry interest @ 15 per cent per annum apart from any other remedy available to the petitioners. It will be open to the respondents to recover the amount of damages and costs from the delinquent officers responsible for passing such unsustainable orders.

19. The writ petitions are allowed in the aforesaid terms with costs quantified at Rs.10,000 per petition.

………………………………J. [J. Chelameswar]

………………………………J. [Sanjay Kishan Kaul]

New Delhi.

May 07, 2018.

_____________________________

1 (2013) 4 SCC 699

2 (2016) 15 SCC 246

3 (supra)

4 (1978) 1 SCC 405

5 (1993) 2 SCC 746

6 (1999) 6 SCC 667

7 (1994) 6 SCC 205

Malay Kumar Ganguly vs Sukumar Mukherjee & Ors [ALL SC 2009 AUGUST]

KEYWORDS:- MEDICAL NEGLIGENCE-mandatory compensation-doctrine of the cumulative effect-

c

DATE: 7 August, 2009

  • The doctrine of cumulative effect is not available in criminal law-
  • “for the death of Anuradha although Dr. Mukherjee, Dr. Halder, Dr. Abani Roy Chowdhury, AMRI, Dr. B. Prasad were negligent, the extent thereof and keeping in view our observations made hereinbefore, it cannot be said that they should be held guilty for commission of an offence under Section 304-A of the Indian Penal Code”

IN THE SUPREME COURT OF INDIA

Malay Kumar Ganguly vs Sukumar Mukherjee & Ors 

Bench: S.B. Sinha, Deepak Verma

CRIMINAL APPELLATE JURISDICTION

CRIMINAL APPEAL NOS. 1191-1194 OF 2005

WITH

CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 1727 OF 2007

Dr. Kunal Saha Versus Dr. Sukumar Mukherjee and others

JUDGMENT

S.B. SINHA, J.

A. INTRODUCTION

A. 1. BACKGROUND FACTS:

The patient (Anuradha) and her husband Dr. Kunal Saha (for short, “Kunal”) were settled in the United States of America. Anuradha, a child Psychologist by profession, was a recent graduate from a prestigious Ivy League School (`Columbia University’ in the New York State). Although a doctor by profession, Kunal has been engaged in research on H.I.V/ AIDS for the past 15 years.

They left U.S.A. for a vacation to India on 24th March, 1998. They arrived in Calcutta on 1st April, 1998. While in Calcutta, Anuradha developed fever along with skin rash on 25th April, 1998. On 26th April, Dr. Sukumar Mukherjee, Respondent No. 1 herein attended and examined Anuradha at her parental residence on a professional call. Dr. Mukherjee assured the patient and her husband of a quick recovery and advised her to take rest but did not prescribe her any specific medicine. However, two weeks thereafter, i.e., on 7th May, 1998, the skin rash reappeared more aggressively. Dr. Mukherjee was again contacted and as per his instructions, Anuradha was taken to his chamber. After examining Anuradha, Dr. Mukherjee prescribed Depomedrol injection 80 mg twice daily for the next three days. Despite administration of the said injection twice daily, Anuradha’s condition deteriorated rapidly from bad to worse over the next few days. Accordingly, she was admitted at the Advanced Medicare Research Institute (AMRI) in the morning of 11th May, 1998 under Dr. Mukherjee’s supervision. Anuradha was also examined by Dr. Baidyanath Halder, Respondent No. 2 herein. Dr. Halder found that she had been suffering from Erithima plus blisters. Her condition, however, continued to deteriorate further. Dr. Abani Roy Chowdhury, Consultant, Respondent No. 3 was also consulted on 12th May, 1998.

On or about 17th May, 1998, Anuradha was shifted to Breach Candy Hospital, Mumbai as her condition further deteriorated severely. She breathed her last on 28th May, 1998.

Kunal sent a lawyer’s notice to 26 persons on 30th September, 1998. The first 19 addressees were those who had treated Anuradha at Kolkata while addressee numbers 20 to 26 were those who treated her in Mumbai.
On or about 19th November, 1998 one of his relatives, Malay Kumar Ganguly filed a Criminal Complaint in the Court of Chief Judicial Magistrate, 24 Paraganas at Alipore against Dr. Sukumar Mukherjee, Dr. Baidyanath Halder and Dr. Abani Roy Chowdhury, respondent Nos. 1, 2 and 3 for commission of offence under Section 304-A of the Indian Penal Code.
Thereafter Kunal filed O.P. Nos. 240 of 1999 against 19 persons who had rendered medical advice/treatment/facilities to Anuradha between 23rd April, 1998 and 17th May, 1998 at Kolkata before the National Consumer Disputes Redressal Commission, New Delhi (Commission). However, pursuant to the orders of the Commission names of some of the respondents were struck off.

In the said petition the complainant claimed an amount of compensation of Rs. 77,76,73,500/- with interest for the alleged deficiency in the service rendered by Respondent Nos. 1, 2, 3, 5, 6 and AMRI hospital (Respondent No.4).

On or about 17.7.1999, a complaint was filed by Kunal against Dr. Sukumar Mukherjee, Dr. Baidyanath Halder and Dr. Abani Roy Chowdhury before the West Bengal Medical Council (WBMC) making allegations similar to the one he had made in his complaint before the Commission.
On or about 29th May, 2000 , OP No. 179 of 2000 was filed by Kunal against the doctors, including Dr. Udwadia of the Breach Candy Hospital at Mumbai and the hospital itself before the Commission.
Before the learned Chief Judicial Magistrate, in the said criminal complaint a large number of witnesses were examined. A large number of documents were also marked as exhibits. The learned Chief Judicial Magistrate, Alipore by his judgment and order dated 29th May, 2002 found Respondent Nos. 1 and 2 guilty of commission of an offence under Section 304-A of the Indian Penal Code and sentenced them to undergo simple imprisonment for three months and to pay a fine of Rs.3,000/- each and in default to undergo a further simple imprisonment for 15 days. Respondent No.3, Dr. Abani Roy Chowdhury was, however, acquitted.

The West Bengal Medical Council dismissed the complaint filed by Dr. Kunal by its order dated 1st July, 2002.

On 25th May, 2003 the complainant-Kunal withdrew O.P. No.179/2009 filed before the Commission against the doctors/Breach Candy Hospital.

Against the order of the learned Magistrate, Respondent No.1 filed Criminal Appeal which was marked as Criminal Appeal No.55 of 2002 and Respondent No.2 filed Criminal Appeal No. 54 of 2002 before the learned Sessions Judge at Alipore, whereas the complainant, Mr. Malay Kumar Ganguly, filed a revision application being C.R.R. No. 1856 of 2002 for enhancement of the punishment imposed on Respondent Nos. 1 and 2. The complainant also filed another revision application before the High Court questioning the legality of the judgment with respect to acquittal of Respondent No.3. The Calcutta High Court withdrew the appeals preferred by Respondent Nos. 1 and 2 before the learned Sessions Judge to itself and heard the criminal appeals and revision petitions together.
By a judgment and order dated 19th March, 2004 the appeals preferred by Respondent Nos. 1 and 2 were allowed while the Criminal Revision Petitions filed by the complainant were dismissed. The said order has been challenged before us by way of Criminal Appeal Nos. 1191-1194 of 2005.
The Commission also by its judgment and order dated 1st June, 2006 dismissed O.P. No. 240 of 1999. Civil Appeal No.1727 of 2007 arises out of the said order.

A.2. SUBMISSIONS OF APPELLANT:

Dr. Kunal Saha, who appeared in person, made the following submissions :-

(i) Respondent No.1 from the very beginning should have referred Anuradha to a Dermatologist as she had skin rashes all over her body.
(ii) Diagnosis of Respondent No.1 that Anuradha was suffering from angioneurotic oedema with allergic vasculitis was wrong.

In any event, prescribing a long acting corticosteroid `Depomedrol’ injection at a dose of 80 mg. twice daily for the next three days when it was the beginning of angeioneurotic oedema and the continued treatment on the same line later at AMRI by Respondent No.1 and other doctors led to her death inasmuch as –

(a) The Medical Journals as also the experts’ opinion show that although steroid is not to be used when the patient is diagnosed to be suffering from Toxic Epidermal Necrolysis (TEN), and although some doctors still administer steroids, the administering of Depomedrol of 80 mg. twice daily, could not be prescribed under any clinical condition.

(b) For the said purpose the evidence of Dr. Anil Shinde (PW-8), Manager of Medical Service for Pharmacia; Dr. S. Bhattacharyya (PW-11), a highly respected Professor of Pharmacology at the Banaras Hindu University and opinions of Prof. Jo-David Fine ; Professor Gerald Pierard and Prof. Fritsch Peter (Exts. 4, 5 and 6) opining that steroids and in any event Depomedrol could not be prescribed; far less, in the quantity in which it had been done.

(iii) The pro-steroid experts also only use “quick acting” steroids for a short period and that too at very early stages of the disease and then quickly stop the same to avoid its side effects to enhance the infection or taper it gradually.
(iv) Respondents failed to adhere to the treatment protocol as outlined in the Table of the Textbook “Cutaneous Medicine and Surgery” authored by Prof. J.E. Revuz and J.C. Rojeau recommending – 5 “Primary Emergency Care” and “Symphtomatic Therapy” including specific direction for “fluid replacement’, “antibacterial policy”, “nutritional support’ etc. The aforementioned should have been advised for treatment of Anuradha at AMRI.
(v) The treatment given to Anuradha at AMRI hospital continued as Respondent Nos. 2 and 3 jointly took charge and recommended steroids, despite stopping “‘Depomedrol’ after 12th May, 1998 without realizing that she had already been a huge amount of a “long-acting” steroid (Depomedrol) and in that view of the matter they should have administered adopted remedial measures which was not done.
(vi) Respondents Nos.2 and 3 added more fuel to the fire in the form of a new “quick-acting” steroid, “Prednisolone” at 40 mg. three times daily, which was itself an excessive dose. Dr. Udwadia of Breach Candy Hospital noticed the same when Anuradha was examined by him; as according to him not more than 40 mg. Prednisolone daily for one day, to be reduced to 5 mg. within the next 5 to 6 days is the ideal dosage.
(vii) When a patient is diagnosed to be suffering from TEN, supportive therapy is imperative in character but no such advice was rendered.
(viii) On and after 12th May, 1998, Anuradha was not provided any supportive treatment which could be evident from the hospital records seized by the police.
(ix) Although the police seized 71 pages of the record from AMRI, merely 22 pages are in relation to her stay during 11th May to 17th May, 1998, whereas the medical record of Breach Candy Hospital from 17th May to 27th May, 1998 cover around 370 pages.

(x) At AMRI records of vital parameters like temperature, pulse, blood pressure; etc. were not maintained which itself is an act of gross negligence.
(xi) Respondent Nos. 5 and 6, although were junior doctors, also followed the treatment guidelines set forth by the three seniors doctors, even though they were independent physicians with postgraduate medical qualifications and, thus, it was expected of them that they would take their independent decisions.
(xii) The Expert doctors has categorically stated that mal-practice had been committed during the treatment of Anuradha.
(xiii) The High Court committed a serious error in opining that there was no medical negligence on the part of Respondents.
(xiv) The allegation that the appellant had resorted to forgery was arrived at by the High Court without any application of mind as Dr. Anil Kumar Gupta testified that it was Respondent No.5 who had inserted the words “for better treatment” in his presence, which was also supported by Mr. T.R. Nehra, handwriting expert.
(xv) The transfer certificate when issued, in any event, must be held to be `for better treatment” as otherwise transfer of a patient from one hospital to the other, in the situation of the present case, was not necessary.
(xvi) The claim that the appellant had interfered in the treatment and had been responsible for his wife’s death is absolutely incorrect inasmuch as his name did not even appear in any of the hospital records suggestive of any interference whatsoever. (xvii) The alleged defence of alibi resorted to by Respondent No.3 and accepted by the High Court is not borne out from the record which clearly shows that he was closely involved in the treatment of Anuradha at AMRI.
(xviii) The telephone bills brought on record clearly show that numerous calls were made by Dr. Kunal Saha to Respondent No.3’s residence as well as to his office, during Anuradha’s stay at AMRI which clearly established that Respondent No.3 was involved with Anuradha’s treatment.
(xix) The High Court has failed to consider the previous decisions of this Court on criminal negligence, as in the instant case gross negligence on the part of the Respondents establishes the offence committed by them under Section 304-A of the Indian Penal Code.
(xx) Negligence in fact in Anuradha’s treatment had been admitted by the Respondents at different stages of the proceedings. A.3. SUBMISSIONS OF RESPONDENTS Mr. Kailash Vasdev, learned senior counsel appearing for Respondent Nos. 1 and 2 would submit :-

(i) Kunal misled the doctors from time to time on the drugs/treatment to be administered to Anuradha.
(ii) The Pathological Reports which were carried out on the basis of the prescription of Respondent No.1 had never been shown to him.
(iii) A panel of elected Committee of the West Bengal Medical Council being an Expert Body having come to a specific finding vis-`-vis the Respondents that there had been no deficiency or negligence on the part of the doctors and use of the drugs is demonstrative of the fact that Respondents had not committed an offence under Section 304-A of the Indian Penal Code.

Mr. Ranjan Mukherjee, learned counsel appearing on behalf of Respondent No.3 contended :-

(i) It stands admitted by the appellant during his cross-examination that Respondent No.3 came to AMRI on 12th May, 1998 hours after Dr. B.N. Halder came there.
(ii) There is no evidence that Dr. B.N. Halder and Respondent No.3 were together at AMRI or that those they discussed about the treatment to be given to the patient.
(iii) Dr. B.N. Halder in his examination under Section 313 of the Code of Criminal Procedure has admitted that the prescription was written by him and, therefore, Respondent No.3 cannot be said to have any liability.
(iv) The plea of the appellant that a joint prescription was made by Respondent Nos. 2 and 3 having been found to be in the handwriting of Kunal himself must be held to be a self-serving document.
(v) Apart from making the joint prescription, Respondent No.3 having not been involved in the treatment of the deceased, the prosecution has miserably failed to prove its case.
(vi) So far as the certificate of transfer of the patient is concerned, the same admittedly being interpolated, no credence thereto can be attached.
(vii) As no witness has testified in support of the allegation that he was the principal physician of Anuradha during her stay at AMRI, the courts below must have correctly held.
(viii) Respondent No.3 having been acquitted by both the courts, this Court should not exercise its jurisdiction under Article 136 of the Constitution of India as the view taken by the courts below is a plausible one.

B. PROCEEDINGS

B.1. TRIAL COURT PROCEEDINGS

The common defence of all the Respondents in the case is denial of material allegations brought against them as also false implication. Separate defences, however, have been entered into by each of the Respondents. We would notice them in seriatum:

(i) Dr. Sukumar Mukherjee examined Anuradha Saha (deceased) only on 7th May, 1998 and 11th May, 1998. He left India on 11th May, 1998 which was within the knowledge of her husband. He treated Anuradha as per medical protocol. He diagnosed her disease as allergic/hypersensitivity vasculitis. Depomedrol was correctly prescribed, being required for the disease Anuradha had been suffering from. The dose prescribed was also correct. He prescribed certain tests to be taken on 7th May as also on 11th May but he was not apprised of the results of those tests. On 11th May, he had also prescribed the requisite supportive treatment which was necessary for the recovery of Anuradha.

(ii) Dr. Baidyanath Halder examined the patient for one day only on 12th May, 1998. He diagnosed the disease as Toxic Epidermal Necrolysis (TEN) correctly and prescribed medicines as per the treatment protocol noted in the text books. He examined the patient having been requested by a group of his students who were friends of Anuradha’s husband. He did not charge any fees. He prescribed all necessary supportive therapy required for the patient of TEN. He had not been given any feedback by the husband of the deceased after 12th May, 1998.

(iii) Dr. Abani Roychowdhury had never seen the patient nor treated her at AMRI at any point of time. He being attached to AMRI visited the hospital once in a week at the outdoor. On 12th May, 1998 having been requested by Dr. Kunal Saha as also Dr. Prasad, he went to the cabin only for the purpose of boosting the patient’s morale. He neither treated her nor was he a member of the team of doctors treating Anuradha at AMRI. As despite requests he had not participated in the treatment of the deceased, Kunal implicated him falsely.

(iv) Respondent No. 4 contended that the Appellant was fully aware of the absence of a burn ward in AMRI at the time of admission of the deceased patient. Furthermore, the deceased was shifted to a VIP cabin in the hospital which was fully isolated, with environmental temperature control. Moreover it was Kunal, himself who had prevented the nursing staff from taking the temperature, blood pressure etc. Also the infection, as alleged, aggravated due to transportation of the deceased from Kolkata to Mumbai. Moreover non administration of IV fluids is a matter of judgment for the treating doctor and is not open to the Hospital Management to interfere with.
(v) Respondents 5, Dr. Balaram Prasad contended that the medical treatment sheet of AMRI dated 11.5.1998, would show that he not only attended the patient for the first time but he also meticulously noted the diagnosis and continued the same medicine for one day as was prescribed by Dr. Mukherjee. Before, however, medicines as per his prescription could be administered, Respondent Nos.1 and Respondent 2 took over the treatment.

(vi) Respondent 6, denied the allegation of the appellant that he did not give effect to the medical protocol while dressing Anuradha. According to him, reference was made to him by Respondent No.5 for the sole purpose of dressing the patient. He took care of the patient as far as wound care was concerned and did the dressing as per medical norms in support whereof reliance was placed on the opinion of Dr. Jean Claude Roujeau of France.
Respondents did not plead guilty, they were put to trial in the criminal matter.

Before the learned Chief Judicial Magistrate, South – 24 Parganas, Alipore, the prosecution examined 11 witnesses. The complainant Malay Kumar Ganguly examined himself as PW-1 whereas husband of the deceased Kunal examined himself as PW-2. Dr. Balaram Prasad who was a visiting consultant of AMRI at the relevant time was examined as PW-3. He is Respondent No 5 in the connected civil appeal. Dr. Aloke Majumdar attached to the B.R. Singh Railway Hospital, Sealdah as Senior Divisional Medical officer (ENT) examined himself as PW-4. PW-5 is Dr. Anil Kumar Gupta who was attached to the Sub-divisional Hospital, Asansol as a Medical Officer. The President of the West Bengal Medical Council Dr. Ashoke Kumar Chowdhury was examined as PW-6. Prasenjit Bhattacharjee, a Sub-Inspector of Kolkata Police who was attached to the Lake Police Station at the relevant time was examined as PW-7. Dr. Anil Shinde, a medical practitioner and Manager of Pharmacia India Limited, Gurgaon, Haryana (the company manufacturing Depomedrol) was examined as PW-8. Dilip Kumar Ghosh who was the Registrar, West Bengal Medical Council has been examined as PW-9. Dr. Faruk E. Udwadia, a consultant physician with specialization in critical care and respiratory medicine of Breach Candy Hospital, Mumbai who treated the deceased from 12th May, 1998 to 18th May, 1998 was examined as PW-10. Dr. Salil Kumar Bhattacharjee, Professor of Pharmacology Institute of Medical Science, Benaras Hindu University was examined as an expert witness PW-11 on behalf of the prosecution.

The defence has also examined 3 witnesses. DW-1 Smt. Sutapa Chanda is the Nursing Superintendent of A.M.R.I. Dr. Kaushik Nandy, a Plastic Surgeon attached to AMRI, who is a Respondent in the connected Civil Appeal and had treated the deceased, was examined as DW-2. Mihir Pal, a Group `D’ staff attached to Asansol Sub-Sivisional Hospital was examined as DW-3.

The prosecution proved as many as 20 documents, whereas the defence has proved 4 documents.

Before the learned Trial Judge as also before the Commission, the parties hereto had relied upon several medical text books of different authors, journals, research papers/ deliberations of the National Conference on Medical Science, transcripts of CDs, package insert, etc. One audio cassette has been produced on behalf of the complainant to prove the conversation which took place between him and the President of the West Bengal Medical Council Dr. Ashoke Kumar Chowdhury.

JUDGMENT OF THE TRIAL COURT

The Trial Court observed as under:
I. The cause of death of Anuradha was Septicemia shock with multi-
organ failure leading to cardio-respiratory arrest. II. The Breach Candy Hospital, Mumbai was not responsible for causing the death of Anuradha.
III. Re : Dr. Sukumar Mukherjee:

(i) He having been consulted by Dr. Kunal Saha since the 4th week of April, 1998, i.e., at his residence, at his chamber at Nightingale Diagnostic & Eye Care Rresearch Centre Private Limited and particularly on 3rd May, 1998, 4th May, 1998, 7th May, 1998 as also on 11th May, 1998 at AMRI and his line of treatment having been followed despite his leaving abroad on the night of 11th May, 1998, his defence that his prescription from the afternoon of 11th May, 1998 became automatically redundant and inoperative cannot be accepted from a doctor of his status. Such a stand taken by him was not only a motivated one but beyond the moral obligation of a doctor to his patients. The medicine was prescribed by him [ Corticosteriod, viz., Depomedrol (Methyleprednisolone Acetate) ] without even diagnosing a disease. But, he did not advise symptomatic therapy like bed rest, elevation of the legs and bandage to reduce Oedema nor prescribed any medicine for control of the underlying disease. It was held:

“…Small vessel vasculitis are of different kinds of which allergic vasculitis is one. It corresponds approximately to Hypersensitivity Angilis. The term allergic is little contentious since it implies a immunological etiology which may be an over simplification. Allergic vasculitis is the most common part of Leucocytoclastic vasculitis in adults. It is characterized by purpuric or necrotic skin lesions, with or without systemic features. Rheumatoid Arthritis is the most common association with coetaneous leucocytoclastic vasculitis…”
(ii)At least on 11th May, 1998, Anuradha was correctly diagnosed by Dr. A.K. Ghoshal as also the following day by Dr. B.N. Halder, still application of Corticosteriod Prednisolone for all these days in prohibitive quantity and dosing intervals with no supportive therapy was continued. That made her lose all her immunity to fight out bacteria and become immunosuppressed leading to `Septicemia’ or `Septic shock’.

(iii)PWs 5 and 11 also deposed about high dose of Depomedrol. Its adverse effects caused `Immunosuppression’ and `Septicemia’ which resulted in the death of Anuradha.

(iv)The working Manager of Pharmacia India Ltd., Dr. Anil Shinde (PW-8) has categorically stated that the maximum recommended dose of Depomedrol for any dermatological or other clinical condition is 40 mg to 120 mg once a week or once in two weeks as per the severity of the disease and clinical need. Depomedrol cannot be given 80 mg twice daily in any clinical condition and even in the right dose it is not recommended for TEN patients as it is a long acting steroid. Therefore, musking of infection, latent infections become active and opportunistic infections are likely as it has immunosuppressive action. The package insert of Depomedrol in U.S.A. indicates that Corticosteroids may musk some signs of infections and new infections may appear during their use.

(v) Another expert Dr. Salil Kumar Bhattacharya (PW-11) has gone further and stated that Depomedrol has a prolonged duration of action. The half life of the drug is 139 hours for which 80 mg twice daily is excessive which is dangerous for the patient and the immediate adverse effect of overuse of this steroid is immunosuppression and chance of opportunistic infection. Sepsis is a severe infective condition which is systemic in nature and is caused by rapid growth and multiplication of infective organism as opined by PW-11.

(vi)Dr. Anil Kumar Gupta (PW-5) made correspondences with Pharmacia Upjohn to receive the following reply:
“…our package insert on Depomedrol does not recommend the twice daily dose of injection Depomedrol 80 mg. in any clinical condition…”
(vii) In his opinion, the use of Depomedrol in high doses can cause immunosuppression and H.P.A. Axis suppression as per package insert.

(viii) Dr. Balaram Prasad who admittedly treated Anuradha had doubt with regard to the treatment of the patient and sought immediate advice regarding continuation of the drug from Dr. Mukherjee and others. However, he was asked to continue with the medicine by Dr. Mukherjee which was started by Dr. Roychowdhury, the Dermatologist.

(ix) Dr. Mukherjee did not follow the treatment guidelines provided for in the Journals. The resolution taken in an International Conference known as Creteilis Experience, 1987 authored by J. Revus and J.C. Roujeau (Ref. Archives of Dermatology, Vol. 123, pages 1156-57) had also not been followed.

(x) Although steroids are used but the supposed advantage of the said therapy are far outweighed by its drawbacks. It is not used as a standard therapy in TEN.

(xi) Although use of Corticosteroid is advocated in the treatment of TEN, reports from early 1980s condemn their use.
(xii) The husband of the deceased is a Non-Resident Indian settled in America as a doctor. The complainant examined doctors from different corners of the country. On the other hand, the witnesses examined on behalf of the defence were one doctor, one Nursing Superintendent and one employee of the Department of Health, Govt. of West Bengal.

(xiii) It is not denied by Dr. Mukherjee in his examination under Section 313 of the Code of Criminal Procedure that immunosuppression, infection and sepsis are the serious adverse effects of Corticosteroids as also the probable effect of the overuse and excessive dose of the said steroids including Depomedrol.

(xiv) Even Dr. Kaushik Nandy (DW-2) admitted that immunosuppression can be a side-effect of overuse or excessive use of Corticosteriods and may cause a chance of infection in any patient. He admitted that steroids should not be used as a standard therapy for treatment of TEN.

(xv) In Fitz Patrick’s Dermatology for General Medicine, the text book on which both sides placed reliance, it is stated that “Glucocorticosteroids (steroids) may promote the risk of infection (Pneumonia, Septicemia)”.
(xvi) Steroid was used in the Breach Candy Hospital, as deposed by PW-10, to completely taper the dose as the patient had very high-circulating steroid level in her body because of her receiving 120 mg. of Prednisolone daily in Kolkata and it was done for her safety only. The point with regard to Haemodialysis was not put to Dr. Udwadia and, thus, no benefit in this behalf can be given to defence.

(vii)Dr. Kaushik Nandy (DW-2) has admitted that a very high circulating steroid level in a patient may appear if large doses of steroids are administered.

(viii)Non-examination of some witnesses like the brother of the deceased Amritava Roy and sisters of AMRI was not very material.
Dr. Sukumar Mukherjee was accordingly held guilty of the charge of negligence.
IV. Dr. Baidyanath Halder
(i) He although diagnosed correctly but prescribed steroids. Although, according to him, he had examined Anuradha only once and no feedback about her condition was given to him. If he was so sincere and careful, he could have collected the information about the condition of the patient with regard to the result of his treatment from the Hospital authorities or the patient party. He had issued a certificate on 16th May, 1998. His prescription of Prednisolone 40 mg. thrice daily and Minabol twice daily was followed by the nurses of AMRI, as stated by Sutapa Chanda (DW-1).

(ii)Dr. Halder was intimated about the prescription of Dr. Mukherjee and the fact that Anuradha had already received 800 mg. of Depomedrol which is equivalent to 1100 mg. of Prednisolone but despite the same he had advised Prednisolone three times a day without any supportive therapy which is mandatory for the patient of TEN as accepted by different universal protocols.
(iii)As Dr. Halder advised against pricking of needles in case of such patients, no supportive treatment could be administered.
(iv)In view of the certificate given by Dr. Halder, the court had reason to believe that he treated the patient from 12th May, 1998 at least upto 16th May, 1998.

(v) Non-tapering of doses of steroid is in violation of the treatment protocol for the disease TEN. The principles of supportive care have been violated totally in the prescription of Dr. Halder.
(vi)In his statement under Section 313 of the Code of Criminal Procedure, he had taken a specific plea that “journey from Kolkata to Bombay likely to enhance the danger”, still, he had issued the certificate.

(vii)The purported interpolation of three words “for better treatment” did not make any difference, i.e., in the certificate itself to show that it was issued at the instance of the patient party.
(viii)The defence that the patient was removed at their own risk is not correct as Dr. Saha did not furnish any risk bond and only some other person not connected with the patient had endorsed the record for taking the patient at his own risk. In any event, such undertaking was not of much significance.

(ix)The accused doctor should not be allowed to raise the question of chance of infection in transit from Kolkata to Mumbai as Anuradha was suffering from TEN which is a non-infectious disorder and she was found fit to travel from Kolkata to Mumbai. In view of her physical condition which was found at Breach Candy Hospital, the certificate issued does not properly reflect the actual physical condition of the patient, which itself amount to avoidance of responsibility on the part of the treating Physician. V. Dr. Abani Roychowdhury
(i) There is nothing to show that Dr. Roychowdhury treated Anuradha except the entries which appeared in the prescription of Dr. Mukherjee dated 11th May, 1998, viz., “May I request Dr. Abani Roychowdhury to see her” and another endorsement dated 15th May, 1998 wherein PW-3 Dr. B. Prasad wrote to continue as advised by Dr. Mukherjee and Dr. Abani Roychowdhury. There is nothing to show that he issued any prescription.
(ii) The statement of DW-1 that Dr. Roychowdhury had been to AMRI is wholly unworthy of credence as she is a hearsay witness having heard the same from PW-2 who in his evidence did not state thereabout.

(iii)The statement made by DW-2 in his affidavit affirmed in the case before the Commission stating that “I carried out and suggested necessary treatment in conformity with the general treatment pattern prescribed by senior consultants, namely O.P. Nos. 2 and 3 who were generally heading the medical team looking after the treatment of the deceased. All the steps were taken to minimize chance of infection and discomfort to the patient/deceased” has not been proved as only a Xerox copy of the same had been produced.
(iv) The complainant has failed to establish the role of Dr. Roychowdhury in the treatment of Anuradha.
VI. The defence story that Dr. Saha had interfered in the matter of treatment, as deposed by DW-2 is not borne out from the treatment sheet and consultation record maintained and kept by the nurses at AMRI particularly in view of the statement of DW-1 that Anuradha’s nurses had been maintaining all the records.
VII. There is nothing on record to show that any advice was given for biopsy. It was not necessary to conduct the post-mortem on the dead body of Anuradha as the cause of death, as expressed by Dr. Udwadia, was known. Immunosuppression having been found by Dr. Udwadia, permission for laboratory tests was not considered necessary.

B.2. HIGH COURT JUDGMENT

(i) The High Court on the other hand in its judgment observed that in view of the nature of the offence under Section 304-A, coupled with the fact that the penalty imposed therefor was imprisonment for two years, the Chief Judicial Magistrate should have converted the summons case into a warrant one.

(ii) The C.J.M. should not have issued warrant of arrest without treating the case into a warrant case.

(iii) It should have been considered that three renowned professors of the State could have been man handled (by the police) on the basis of said arrest warrant.

(iv) The fact that accused doctors did not levy any professional fees was also a matter of relevance.

(v) In absence of the post-mortem examination with regard to the cause of death of Anuradha, it must be held that the death was a natural one. The death certificate issued by the Breach Candy Hospital, Mumbai was not a conclusive proof of the cause of death but was only a tentative one. It was silent about the antecedent cause or other significant conditions contributing to the death. The death certificate could not rule out the possibility of accidental, suicidal or homicidal cause of death. The doctor who issued the death certificate was not examined. Thus immediate cause of death vis-a-vis the link thereof with the treatment at Kolkata and that too specially at the hands of Respondents 1 to 3 was not proved.

(vi) Improvement to her health noticed in the Mumbai hospital after 25th May, 1998 ran contrary to the contention of complainant. Re : DR. MUKHERJEE The allegation that he was responsible for causing the death of Anuradha by his rash and negligent act not amounting to culpable homicide by advising, prescribing and treating the deceased with steroid drugs namely Depomedrol, 80 mg, IM stat twice daily and other drugs in improper dosage at improper interval without any supportive treatment was rejected for the following reasons :-

(i) Various tests advised by him were not undertaken and he was not apprised of the treatment chart of Anuradha for the period 3rd April, 1998 to 6th May, 1998.
(ii) Anuradha admittedly was suffering from certain allergic disorders which were aggravated due to the intake of Chinese food and for treating such allergic disorders generally steroids would be used and thus the trial court was not correct to hold that Dr. Mukherjee should not have prescribed Depomedrol.
(iii) There is nothing on record to show that the drug was actually administered to the patient because no feedback of the treatment was given to him.
(iv) At the time of admission at AMRI, Dr. Mukherjee’s prescription was not taken into consideration. In fact it was indicated that the patient was being treated by somebody else whose identity had not been disclosed.
(v) Diagnosis that Anuradha was suffering from TEN was not done by Dr. Mukherjee. The package insert of Depomedrol did not indicate that it could not be prescribed for the said disease. As Anuradha is stated to be suffering from vasculitis and could be treated with the said medicine, which opinion has been supported by others including Dermatologist – Dr. A.K. Ghoshal, it could not be construed to be incorrect and contrary to medical practice and ethos.

(vi) Dr. Ghosal was not examined to explain the basis upon which the patient was diagnosed to be suffering from TEN.
(vii) Oral admission of Tab. Wysolone was sufficient to indicate that the treatment of the patient was being carried out as per the prescription of Dr. Mukherjee. However, in any event the evidence on record was sufficient to indicate that from 3rd April, 1998 till her admission at AMRI on 11th May, 1998, Anuradha was being treated after taking advice from different doctors. There was evidence on record to indicate that Kunal’s doctor friends contributed in her treatment.

(viii) There is a possibility of Anuradha suffering from drug allergy as well as allergy from Chinese foods. Application of steroid is undoubtedly an accepted treatment protocol for allergic disorders. In fact, Depo-Medrol is a Glucocorticoid which has anti inflammatory and anti-allergic action.

(ix) Allergic vasculitis is an allergic and inflammatory condition of the blood vessels in the body and can affect not only the blood vessels of the skin but also any internal vital organs leading to death of the patient at any point of time. Allergic vasculitis is not a dermatological disease. The treatment suggested by Dr. Mukherjee, therefore, could not be considered to be an act of rash and negligence.

Re : DR. HALDER

The allegation of the complainant that the prescription by Dr. Halder of Prednisolone 40 mg. thrice daily had aggravated the disease was held not tenable on the following grounds :-

(i) He visited the patient only on 12th May, 1998 which was supported by Dr. Balaram Prasad. He, therefore, had no role to play in the treatment of Anuradha which would be evident from the record of AMRI.
(ii) There is nothing on record to show that the prescription of Prof. Halder was given effect to.

(iii) Occlusive dressings were carried as a result of which infection had been increased
(iv) He had suggested Benadryl Syrup as there were eruptions inside the mouth and Cortisone Kemicetin eye ointment for eye care. However, the steroid based Neomycin Antibiotic was prescribed by the Consultant Ophthalmologist Dr. S. Bhattacharya on 12th May, 1998, although Prof. Halder in his prescription advised to avoid Neomycin and Soframycin which are common causes of drug allergy. As such the treatment suggested by Prof. Halder was not followed.

(v) There was no evidence to show that he was incharge of the patient.

(vi) There was no evidence to indicate that Dr. Mukherjee ever requested Dr. Halder to see the patient.

(vii) Despite the fact that Dr. Halder confirmed that the patient was suffering from TEN, records indicated that his line of treatment was not followed and, thus, the evidence to consider the deceased to be suffering from TEN is of no value.

(viii) Anuradha was thus not suffering from TEN. Although the papers of Breach Candy Hospital mention that the disease was diagnosed as TEN, but the attending physician was not a dermatologist. Thus no one came forward to say that Anuradha was suffering from TEN.

(ix) The death certificate also did not indicate that Anuradha was suffering from TEN.

(x) Dr. Kunal Saha, husband of the deceased Anuradha being himself not a Dermatologist; his opinion is irrelevant, particularly when he is said to have become specialist of TEN subsequently upon studying the subject after her death.
(xi) Prescription of Prof. Halder indicted that he stopped Depo-
Medrol once he started Prednisolone 40 mg. thrice with other medicines. He also prohibited local anesthesia, Neomycin, Soframycin. He also gave importance on Elecrtolyte balance, nutrition and advised for prevention of secondary infection.
(xii) Prof. Halder is a renowned Dermatologist with numerous publications and teaching experience. His line of treatment was in conformity with the accepted norms particularly in view of the fact that there is no universal protocol for the treatment of TEN. Treatment of each patient will depend upon his/her condition on a particular day.

(xiii) During Anuradha’s stay at AMRI there was no indication of any complication like hypovolemia, internal organ failure, infection of septicemia etc.

Re : PROF. ABANI ROY CHOWDHURY.

Allegation that he had also taken active part in the treatment of Anuradha is not established from the record.

There is nothing on record to show that Dr. Halder while writing the prescription had any prior discussion with Dr. Abani Roychowdhury. The endorsement that the prescription was a joint prescription of Dr. Halder and Dr. Roychowdhury was admittedly made by Dr. Kunal Saha himself Although some of the doctors of AMRI had stated that they had received the advice of Dr. Roychowdhury but the nature of the advice had not been clarified by them.
RE: CERTIFICATE The allegation that the certificate was issued at the instance of Dr. Roychowdhury is not correct as the certificate issued by Prof. Halder did not indicate that Anuradha was being carried by a Chartered flight for better treatment. The words “for better treatment” were not written by Prof. Halder and only in the course of evidence it was proved that there was an interpolation in the certificate. The same was also admitted by Dr. Balaram Prasad and thus the certificate of Prof. Halder was held to be forged. The forged certificate demolishes the prosecution story that at the advice of Prof. Halder or Prof. Roychowdhury the patient was taken to Mumbai. The endorsement of Dr. Kunal Saha on the record of AMRI really proved that Anuradha was shifted from the hospital at their own risk. The evidence on record also indicates that till the evening of 18th May, 1998, the dressing of Anuradha was not changed. Thus, by removing Anuradha, her husband Kunal Saha took upon himself great risk of infection to her in course of transit being aware that infection was very common at that critical stage for the patient.

Kolkata doctors had no hand in shifting Anuradha from Kolkata to Mumbai.

The High Court also opined that the patient party did neither follow the advice of Dr. Mukherjee nor that of Prof. Halder. GENERAL OBSERVATIONS BY THE HIGH COURT
(i) As Anuradha was treated at AMRI for six days and at Breach Candy Hospital for 12 days, by no stretch of imagination her death had anything to do with the treatment at AMRI ; the cause of death being absent.
(ii) The contention of Dr. Kunal Saha that his wife was almost dead when brought to Breach Candy Hospital, was untrue.

(iii) Anuradha was admitted under Dr. Balaram Prasad, who was a Consultant Physician having Post Graduate Degree. He also claimed to be the physician-in-charge of the treatment.

(iv) Interference by Dr. Kunal Saha was sufficient to indicate that treatment of Anuradha was monitored by him alone and nobody else. Although, he claimed that Anuradha was suffering from TEN which was a dermatological disease, but Anuradha was admitted by him under a Plastic Surgeon, Dr. S. Keshwani. Even at the initial stage Dr. Kunal Saha gave instructions to the doctors on 17th May, 1998 rejecting the treatment suggested by doctors attending at Breach Candy Hospital, Mumbai. Thus the diagnosis of the disease and the follow-up action was done under the direct supervision of Dr. Kunal Saha and his brother-in-law. Such was the position at AMRI also.

(v) The opinion of three internationally-accepted experts on TEN was not acceptable as none of them were examined in Court. From the records of Breach Candy Hospital it would itself appear that Anuradha was being administered medicines other than the ones prescribed by the doctors. Cash memos for purchase of medicines would show the discrepancy in the medicines prescribed by the doctors like Bactroban Ointment, Efcorlin (one kind of steroid) and Sofratule purchased on 12th, 13th and 16th May, 1998 had not been prescribed by the doctors. Relatives of the patient having not followed the treatment protocol of the doctors under whom the patent is admitted; as soon as any interference is made therewith, the doctors are absolved of their liability.

Charge of professional negligence on a medical person is a serious one as it affects his professional status and reputation and as such the burden of proof would be more onerous. A doctor cannot be held negligent only because something has gone wrong. He also cannot be held liable for mischance or misadventure or for an error of judgment in making a choice when two options are available. The mistake in diagnosis is not necessarily a negligent diagnosis.

Even under the law of tort a medical practitioner can only be held liable in respect of an erroneous diagnosis if his error is so palpably wrong as to prove by itself that it was negligently arrived at or it was the product of absence of reasonable skill and care on his part regard being held to the ordinary level of skill in the profession. For fastening criminal liability very high degree of such negligence is required to be proved.
Death is the ultimate result of all serious ailments and the doctors are there to save the victims from such ailments. Experience and expertise of a doctor are utilised for the recovery. But it is not expected that in case of all ailments the doctor can give guarantee of cure.

B.3. NATIONAL COMMISSION JUDGMENT

The Commission in its judgment noted that doctor or a surgeon never undertakes that he would positively cure the patient nor does he undertake to use the highest degree of skill, but he only promises to use fair, reasonable and competent degree of skill. In this regard the commission opined that if there are several modes of treatment and a doctor adopts one of them and conducts the same with due care and caution, then no negligence can be attributed towards him It went on to note that there was no negligence on part of Dr. Mukherjee because even Dr. A. K. Ghoshal, Dermatologist, who diagnosed the disease of Mrs. Anuradha as TEN, prescribed the same treatment.
Further, it observed that no records were produced by Dr. Saha regarding the treatment given to Mrs. Anuradha from 1st April 1998 to 7th May 1998. As there is no specific treatment for TEN, error of judgment in the process of diagnosis does not amount to deficiency in service, considering that the disease TEN is a rare occurring in 1 case out of 1.3 per million per year.

It went on to observe that the patient was never in the absolute care of Dr. Haldar, who had treated her only on 12th of May 1998. Dr. Haldar, it noted, was, therefore, an unnecessary party.

It opined that all the necessary care was taken by Dr. Mukherjee and Dr. Haldar. It laid special emphasis on the fact that a complaint had been filed before the West Bengal Medical Council, which concluded that there was no deficiency on the part of the doctors. The Writ petition against the said decision before the High Court was dismissed. Therefore, it was concluded that there was no negligence on the part of the doctors.

C. DETERMINATION OF CERTAIN SALIENT POINTS OF LAW AND FACTS

C.1. EXPERT EVIDENCE

Section 45 of the Indian Evidence Act speaks of expert evidence. It reads as under :-

“45. Opinions of experts – When the Court has to form an opinion upon a point of foreign law, or of science, or art, or as to identity of hand writing or finger-impressions, the opinions upon that point of persons specially skilled in such foreign law, science or art, or in questions as to identity of handwriting or finger impressions, are relevant facts. Such person called experts.
Illustrations
(a) The question is, whether the death of A was caused by poison. The opinions of experts as to the symptoms produced by the poison by which A is supposed to have died, are relevant.
(b) The question is whether A, at the time of doing a certain act, was by reason of unsoundness of mind, in capable of knowing the nature of the act, or that he was doing what was either wrong or contrary to law.
The opinions of experts upon the question whether the symptoms exhibited by A commonly show unsoundness of mind, and whether such unsoundness of mind usually renders persons incapable of knowing the nature of the acts which they do, or knowing that what they do is either wrong or contrary to law, are relevant.
(c) The question is, whether a certain document was written by A. Another document is produced which is proved or admitted to have been written by A.
The opinion of experts on the question whether the two documents were written by the same person or by different persons are relevant.”
A Court is not bound by the evidence of the experts which is to a large extent advisory in nature. The Court must derive its own conclusion upon considering the opinion of the experts which may be adduced by both sides, cautiously, and upon taking into consideration the authorities on the point on which he deposes.

Medical science is a difficult one. The court for the purpose of arriving at a decision on the basis of the opinions of experts must take into consideration the difference between an `expert witness’ and an `ordinary witness’. The opinion must be based on a person having special skill or knowledge in medical science. It could be admitted or denied. Whether such an evidence could be admitted or how much weight should be given thereto, lies within the domain of the court. The evidence of an expert should, however, be interpreted like any other evidence.
This Court in State of H.P. v. Jai Lal and others, [ (1999) 7 SCC 280] held as under :-

” 17. Section 45 of the Evidence Act which makes opinion of experts admissible lays down that when the court has to form an opinion upon a point of foreign law, or of science, or art, or as to identity of handwriting or finger impressions, the opinions upon that point of persons specially skilled in such foreign law, science or art, or in questions as to identity of handwriting, or finger impressions are relevant facts. Therefore, in order to bring the evidence of a witness as that of an expert it has to be shown that he has made a special study of the subject or acquired a special experience therein or in other words that he is skilled and has adequate knowledge of the subject.
18. An expert is not a witness of fact. His evidence is really of an advisory character. The duty of an expert witness is to furnish the Judge with the necessary scientific criteria for testing the accuracy of the conclusions so as to enable the Judge to form his independent judgment by the application of this criteria to the facts proved by the evidence of the case. The scientific opinion evidence, if intelligible, convincing and tested becomes a factor and often an important factor for consideration along with the other evidence of the case. The credibility of such a witness depends on the reasons stated in support of his conclusions and the data and material furnished which form the basis of his conclusions.
19. The report submitted by an expert does not go in evidence automatically. He is to be examined as a witness in court and has to face cross- examination. This Court in the case of Hazi Mohammad Ekramul Haq v. State of W.B.
concurred with the finding of the High Court in not placing any reliance upon the evidence of an expert witness on the ground that his evidence was merely an opinion unsupported by any reasons.”

ADMISSIBILITY OF EXHIBITS 4, 5 AND 6

Kunal, before us, contended that the High Court committed a serious error in not placing reliance upon medical opinions i.e. Exts. 4, 5 and 6 on the premise that no objection in that behalf was raised at any point of time.
Kunal would argue that this Court having given him permission to examine the expert witnesses on Video Conferencing and he having deposed in terms thereof, Respondents could have asked for their cross-examination at any point of time and not having done so, it does not lie in their mouth to contend that the opinions of the said experts who are themselves authors on TEN and having done research on the disease TEN, are not admissible.

FOR THE PURPOSES OF CRIMINAL PROCEEDINGS

Kunal, however, would contend that the aforementioned documents were exhibited without any demur whatsoever. The respondents, furthermore, did not make any prayer to cross-examine the said witnesses.
It is true that ordinarily if a party to an action does not object to a document being taken on record and the same is marked as an exhibit, he is estopped and precluded from questioning the admissibility thereof at a later stage. It is, however, trite that a document becomes inadmissible in evidence unless author thereof is examined; the contents thereof cannot be held to have been proved unless he is examined and subjected to cross- examination in a court of law.

The document which is otherwise inadmissible cannot be taken in evidence only because no objection to the admissibility thereof was taken. In a criminal case, subject of course, to the shifting of burden depending upon the statutes and/or the decisions of the superiors courts, the right of an accused is protected in terms of Article 21 of the Constitution of India. The procedure laid in that behalf, therefore, must be strictly complied with. Exhibits 4, 5 and 6, in our opinion, are not admissible in evidence in the criminal trial.

FOR PURPOSES OF PROCEEDINGS BEFORE THE NATIONAL COMMISSION

The said exhibits, however, are admissible before the consumer court. This Court in R.V.E. Venkatachala Gounder v. Arulmigu Viswesaraswami & V.P. Temple,(2003) 8 SCC 752, at page 763 :
“… Ordinarily, an objection to the admissibility of evidence should be taken when it is tendered and not subsequently. The objections as to admissibility of documents in evidence may be classified into two classes: (i) an objection that the document which is sought to be proved is itself inadmissible in evidence; and (ii) where the objection does not dispute the admissibility of the document in evidence but is directed towards the mode of proof alleging the same to be irregular or insufficient. In the first case, merely because a document has been marked as “an exhibit”, an objection as to its admissibility is not excluded and is available to be raised even at a later stage or even in appeal or revision. In the latter case, the objection should be taken when the evidence is tendered and once the document has been admitted in evidence and marked as an exhibit, the objection that it should not have been admitted in evidence or that the mode adopted for proving the document is irregular cannot be allowed to be raised at any stage subsequent to the marking of the document as an exhibit. The latter proposition is a rule of fair play. The crucial test is whether an objection, if taken at the appropriate point of time, would have enabled the party tendering the evidence to cure the defect and resort to such mode of proof as would be regular. The omission to object becomes fatal because by his failure the party entitled to object allows the party tendering the evidence to act on an assumption that the opposite party is not serious about the mode of proof. On the other hand, a prompt objection does not prejudice the party tendering the evidence, for two reasons: firstly, it enables the court to apply its mind and pronounce its decision on the question of admissibility then and there; and secondly, in the event of finding of the court on the mode of proof sought to be adopted going against the party tendering the evidence, the opportunity of seeking indulgence of the court for permitting a regular mode or method of proof and thereby removing the objection raised by the opposite party, is available to the party leading the evidence. Such practice and procedure is fair to both the parties. Out of the two types of objections, referred to hereinabove, in the latter case, failure to raise a prompt and timely objection amounts to waiver of the necessity for insisting on formal proof of a document, the document itself which is sought to be proved being admissible in evidence. In the first case, acquiescence would be no bar to raising the objection in a superior court.”

Section 22 of the Consumer Protection Act, 1986 provides that Sections 12, 13 and 14 thereof and the rules made thereunder for disposal of the complaints by the District Forum, shall with such modification as may be considered necessary by the Commission, be applicable to the disposal of disputes by the National Commission. Section 12 of the 1986 Act provides for the manner in which the complaint shall be made. Section 13 prescribes the procedure on admission of the complaint. Sub-section (3) thereof reads:-
“(3) No proceedings complying with the procedure laid down in sub-sections (1) and (2) shall be called in question in any court on the ground that the principles of natural justice have not been complied with.”

Apart from the procedures laid down in Section 12 and 13 as also the Rules made under the Act, the Commission is not bound by any other prescribed procedure. The provisions of the Indian Evidence Act are not applicable. The Commission is merely to comply with the principles of natural justice, save and except the ones laid down under sub-section (4) of Section 13 of the 1986 Act.

The proceedings before the National Commission are although judicial proceedings, but at the same time it is not a civil court within the meaning of the provisions of the Code of Civil Procedure. It may have all the trappings of the Civil Court but yet it can not be called a civil court. [ See Bharat Bank Ltd. v. Employees of the Bharat Bank Ltd. [1950 SCR 459] and Nahar Industries Ltd. v. Hong Kong & Shanghai Banking Corporation etc. (Civil Appeal arising out of SLP (C) No. 24715 of 2008 etc decided on 29th July, 2009)] Mr. Gupta, learned counsel appearing on behalf of Dr. Balram Prasad contended that the opinions, exhibits P-4, P-5 and P-6 are inadmissible in evidence.

The opinions of the experts as contained in the said documents are probably based on the hospital records and other relevant papers. Such opinions have been rendered on the basis of their expertise. They were notarized. The said opinions have been appended to the complaint petition even as documents. Respondents did not question the correctness thereof either before the court or before the Commission. They did not examine any expert to show that said opinion are not correct. The concerned respondents in their depositions before the Commission also did not challenge the correctness or otherwise of the said opinions. Even otherwise the deficiencies pointed out therein are explicit from the records.

This Court in J.J. Merchant (Dr) v. Shrinath Chaturvedi, [(2002) 6 SCC 635], held as under :-

“19. It is true that it is the discretion of the Commission to examine the experts if required in an appropriate matter. It is equally true that in cases where it is deemed fit to examine experts, recording of evidence before a Commission may consume time. The Act specifically empowers the Consumer Forums to follow the procedure which may not require more time or delay the proceedings. The only caution required is to follow the said procedure strictly. Under the Act, while trying a complaint, evidence could be taken on affidavits [under Section 13(4)(iii)]. It also empowers such Forums to issue any commission for examination of any witness [under Section 13(4)(v)]. It is also to be stated that Rule 4 in Order 18 CPC is substituted which inter alia provides that in every case, the examination-in-chief of a witness shall be on affidavit and copies thereof shall be supplied to the opposite party by the party who calls him for evidence. It also provides that witnesses could be examined by the court or the Commissioner appointed by it. As stated above, the Commission is also empowered to follow the said procedure. Hence, we do not think that there is any scope of delay in examination or cross-examination of the witnesses. The affidavits of the experts including the doctors can be taken as evidence. Thereafter, if cross-examination is sought for by the other side and the Commission finds it proper, it can easily evolve a procedure permitting the party who intends to cross-examine by putting certain questions in writing and those questions also could be replied by such experts including doctors on affidavits. In case where stakes are very high and still a party intends to cross-examine such doctors or experts, there can be video conferences or asking questions by arranging telephonic conference and at the initial stage this cost should be borne by the person who claims such video conference. Further, cross-examination can be taken by the Commissioner appointed by it at the working place of such experts at a fixed time.”

C.2. DIAGNOSIS AND TRAIL OF TREATMENT OVERVIEW OF TOXIC EPIDERMAL NNECROLYSIS

Toxic Epidermal Nnecrolysis (TEN hereinafter) is also known as Lyell’s Syndrome, epidermolysis acuta toxica and scalded skin syndrome. TEN begins with a non- specific prodome of 1- 14 days in atleast half of the patients. It is a severe and extensive variant of erythematobullous drug eruption. In TEN, the patient is ill with high fever occasionally suffers somnolence and lassitude. Because of the extensive area of eroded skin, large amount of body fluid is lost with consequent disturbances of electrolyte and fluid balance. [See Dermatology in General Medicine ( Fitz Patrick’s) (5th Ed), and Comprehensive Dermatological Drug Therapy] NEGLIGENCE IN TREATMENT OF TEN For determining the question as to whether the respondents herein are guilty of any negligence, we may notice the treatment protocol.
Anuradha, it is conceded, was suffering from TEN. She had been positively diagnosed to be suffering from the said disease on 12th May, 1998. TEN is a spectrum of symptoms. The treatment protocol for TEN has undergone considerable change throughout the world.
TEN was discovered in the year 1956 by Lyell. It leads to immunosuppression. For treating the patients suffering from TEN, doctors used to administer steroid. Later researches showed that they should not be used. Such a conclusion was arrived at upon undertaking researches of patients suffering from the said disease with administration of steroid as well as non-administration of them. It was found that those patients treated with steroids do not respond properly thereto. Indisputably, however, some doctors still use steroids. It is stated that the researchers found out that use of steroids was more detrimental than beneficial to the TEN patients.
Admittedly, Anuradha was administered steroids. The learned counsel for the parties have brought before us a vast volume of material to contend that the experts in the field as also the doctors or medical practitioners who have specialized in TEN and other dermatological diseases are sharply divided on the administration of steroid. We for the sake of brevity refer to them as the pro-steroid group and anti-steroid group. Medical science, therefore, has a grey area in this respect.
At the outset, we may place on record the treatment pattern prescribed by two experts, viz., Jean Edouard Revuz and Jean Claude Roujeau who are generally accepted world over. According to them, the treatment pattern should be as under:

“The disease usually begins with non specific symptoms, such as fever, cough, sore throat, burning eyes, followed in 1 to 3 days by skin and mucous membrane lesions. A burning or painful rash starts systematically on the face and in the upper part of the tongue and rapidly extends. Most frequently, the initial individual skin lesions form poorly defined margins with darker purpuric centre progressively emerging on the skin, chest and back. Less frequently, the initial manifestations may be extensive scarlatiniform erythema. Symptomatic therapy is a must. IV fluids must be replaced mandatorily.
The treatment protocol includes:
7 Symptomatic treatment 7 Monitoring 7 Fluid replacement and anti-infection therapy 7 Nutrition 7 Warming (30-32 degree Celsius) 7 Skin care 7 Eyes and mucous membrane care”

They hold the view that the current evidence suggests that corticosteroids are more dangerous than useful in these disorders as they increase the risk of death from infections, including systemic candidiasis, a complication that had never been observed in many patients treated without steroids.

After the death of Anuradha, Kunal consulted a large number of experts from various countries including India.

The Canadian Treatment Protocol is as under:

“IV fluid resuscitation- including internal feeding, use of air- fluidized beds, complete avoidance of steroids, use of narcotics for pain, use of catheters to be avoided, meticulous eye care daily, use of systemic antibiotic therapy for specific infections but not for prophylaxis, topical antibiotic therapy is not used, meticulous wound care and moist saline gauge dressing are applied once daily when most of the involved epidermal surface has sloughed off, usually 3 to 4 days after the onset of TEN the patient is given general anesthesia for washing the wounds vigorously and applying briobrane under tension to be stapled all over”.
Dr. George Goris, Managing Director Medical and Drug Information of Pharmacia and Upjohn expressed that “DEPO” dosage of more than the approved indication, that too 80 mg twice daily, was not correct.
Dr. David Fine, Dermatologist from University of North Carolina opined as under:

“….. conventional therapy of TEN with systemic corticosteroids involves either oral or intravenous preparation. I have personally never seen intramuscular corticosteroids administration for this condition. In addition, intramuscular corticosteroids are never given on a BID schedule (and with some preparations no more frequently than every 4-6 weeks) because of the prolonged Depot effect related to administration by this particular route. In general, intramuscular administration of systemic corticosteroids is not employed in the treatment of dermatological diseases since this routes provides very erratic release of medication from the tissue…..”

He also remarked, as far as the treatment in the present case is concerned:

” …. manner in which the treatment was instituted in your wife certainly appears to be unprecedented.”

Dr. David Heimbach, Professor of University of Washington holds the view that the injection “DEPO” in twice daily dose was not indicated in TEN protocol and the dosing interval as advised in the prescriptions of the opposite party no. 1 is not recommended for treatment of any medical condition, leave aside for, far less an acute medical condition such as the one the patient was suffering from i.e. TEN.

Dr. Timothy Bradley, noted Physician wrote a famous article on TEN wherein it was stated that several patients of TEN with 95% total BSA involvement were treated without use of steroids and there was 100% survival rate. In his view, the keystone, for survival in patients with TEN is fluid resuscitation and nutritional support and vigilant surveillance for infection.
Gerald Pierard in his treatise on TEN stated:-

a) Antiseptic measures are essential to treat TEN patients since septicaemia shock is the first cause of mortality. So a sterile room and antiseptic bathes have to be used. Intact blisters can be left in place but when they burst, the narcotic skin must be eliminated otherwise it becomes an excellent medium for the proliferation of microorganisms.
Repeated skin swabs should be done to detect excessive coetaneous infection and to guide prophylactic antibiotherapy. Systematic antibiotics should also be used if direct or indirect signs of septicaemia happen: positive blood cultures, pneumonia, decrease of the urinary flow, fever or rapid fall of the temperature, impairing of the general condition, and decrease in the white cells count with neutropenia. The search of these signs implies a permanent patient’s supervision with many blood takes. Of course, unnecessary i.v. catheters should be avoided but in practise it is impossible to totally avoid them. They have to be changed frequently and placed in culture after removal.
b) Supportive measures are also essential. Several litres of fluid per day are needed since fluid loss is enormous in severe cases. The absence of substitution of these fluids leads to important internal problems. The only way to bring such amount of fluid is by catheters. The oral way is absolutely inadequate, more especially as digestive tract is also often injured. Once more, as previously said, catheters should be changed very regularly (maximum every 3 days), placed if possible in areas of intact skin and examined for bacterial contamination after removal.
c) Any definite TEN drug treatment is currently not recognised. The case of systematic steroids is controversial. The use of high doses of quick acting corticosteroids for a short time could be defensible for patients treated at the beginning of TEN without any sign of septic contamination, to try to stop the advancement of the disease. Steroids are clearly harmful and ineffective when the disease has settled. Long-acting steroids have no place in TEN treatments. Their action is too late.
d) The slough of the skin and mucous membrane is painful and it is medical and ethical concern to relief pain in TEN.”

Our attention has also been drawn to the resolutions adopted in the year 1985 at Creteil in France. We would label it as `Creteil Experience’. It is summarized as under:

” The absence of dermal inflammatory infiltration in TEN is an argument against steroid therapy. Certain authors have claimed that the extension of necrolysis is arrested by high-dose corticosteroid therapy, but the natural history of TEN is very variable both in extent and time course. In some cases nerolysis is complete within 24 hours. Clearly, steroid therapy is illogical in such patients. In other patients, necrolysis may occur in waves. The unpredictable course of the disease casts further doubt on uncontrolled claims of the efficacy of steroid therapy. The benefits of steroid therapy, if any, would be observed only at an early stage of a slowly evolving case of TEN. It cannot be overemphasised that once a large area of dermis is uncovered i.e. more than 20% of the body surface area, the supposed advantages of steroid-therapy are far outweighed by its drawbacks. The opinion that steroids should not be used as a standard therapy for TEN is shared by the majority of authors and was unanimously agreed on at an international workshop on TEN held in Creteil, France in October 1985. More recently, Halebian et al have reported high improvement of survival in patients treated without steroids when compared with a previous series of patients treated with high dose steroid therapy in the same institution.
Kunal had also consulted several doctors and experts in India. We would notice the opinion of some of them here but we would deal with their admissibility at a later stage.

Dr. S.K. Bose from Apollo Hospital, Delhi, on a query made by the appellant, opined that the treatment protocol should be symptomatic and corticosteroids should be avoided. The resume of the protocol which should be followed, according to him, is as under:

– Discontinue all drugs implicated in TEN JAAD 1991
– Intravenous canalization for fluid replacement depending upon % of TBSA, Nasogastric tube feeding, catheter if required
– Topical skin care
– Monitoring serum electrolytes by culture
– Room Temperature of about 30-32 degrees Celsius, sterile environment, air fluidized bed, barrier nursing
– Encourage oral fluids
– Hyperbaric oxygen, aerosols, bronchial aspiration, physical therapy, therapies for herpes and mycoplasma.

Appellant also consulted those Indian doctors who still administered steroids. Dr. J.S. Pasricha is one of them. According to him, use of corticosteroids in TEN was very controversial; however, if they are used appropriately, the patient’s life can be saved. Death due to usage of corticosteroids in TEN patients, he stated, occurs only when :
– The reaction is not controlled properly
– Corticosteroids are not withdrawn quickly Attention has also been drawn to the protocol treatment on behalf of the respondents. They have placed reliance on a number of authorities to suggest a protocol of treatment of the disease TEN in which the administration of glucocorticosteriods plays an integral role. Some of the authorities suggested by them include:
– Journal of Association of Physicians of India.
– Comprehensive Dermatological Drug Therapy.
– Dermatology by O. Brian Falco.
– Dermatology in General Medicine (Fitz Patrick) (5th Ed)
– Goodman and Gillman: The Pharmacological Basis of Therapuetics (9th) (Ed)
– Harrison’s Principle of Internal Medicine
– Principle’s of Pharmacology.
– Journal of Burn Care and Rehabilitation ( A 10 year experience with TEN)
– TEN – Medical Findings and Prognosis in 87 Patients, Jean Revuz, From the archives of Dermatology
– J.S. Pasricha, TEN, International Journal of Dermatology.
Nonetheless the following principles are integral to the treatment of TEN as suggested by the Respondents:
a. Treatment in burn units should be strived for in exceptional cases but is not generally necessary.
b. Treatment has to be individually tailored according to cause, type, stage and presence of complications.
c. Systemic glucocorticoids should not be used routinely but are justified in the early stages of drug induced TEN. They should be given in doses from 80 to 120 mg of methlypredisolone per day by mouth, for several days until disease progression has ceased. Dosages should be tapered quickly and cautiously since no further benefit can be expected thereafter and the untoward effects may then predominate.
d. Treatment may focus on early detection and prevention of the most fatal complication e.g. overwhelming infection. Cultures from skin and mucosal erosions, must be regularly performed. e. Blood gases and fluid, electrolytes and protein balance must be monitored and adjusted appropriately. Fluid replacement regimens as used for burn patients.
f. Supportive care is of great importance and particular attention must be paid to a high calorie and high – protein diet.
g. Debridgement of necrotic skin should not be performed before disease activity ceases.
In the criminal case, the appellant examined Dr. Salil Kumar Bhattacharjee. For the sake of completeness it would be necessary to place on record his opinion in the matter.

Dr. Bhattacharjee, as noticed hereinbefore, is a Professor of Pharmacology at the Institute of Medical Science, Benaras Hindu University. In an answer to a query, on whether he was aware of the drug Depomedrol and its usage, he answered that “it is usually used in chronic clinical condition like Bronchial Asthma and Rheumatiod Arthritis” and on being questioned, whether Depomedrol can be used for TEN, he answered in the negative. He stated that recommended usage is 40 to 120 mg at intervals of at least one week and a daily dose of 80 mg can never be used.
Appellant also examined Dr. Udwadia. He is the Consultant Physician in the Breach Candy Hospital. Anuradha was a patient in the said hospital under him. He has not used Depomedrol although his personal view was that he would have used lesser doses of corticosteroid. Although he had not used Depomedrol and he had no experience with the said drug, he categorically stated that it could obviously add to steroid. In his statement, he made it clear that “all corticosteroids are double-edged weapons on the one hand, there can be a beneficial effect and on the other, they can have untoward effects and the effect is immunosuppression leading to infection”. He also testified that supportive therapy was necessary.
In the criminal case, even Dr. Prasad who was examined as PW-3 stated that he prescribed Depomedrol for a day after seeing the prescription of Dr. Mukherjee. And before the National Commission he stated that Depomedrol 80 mg twice daily cannot be administered to any patient. Before the Commission Dr. Mukherjee admitted that he prescribed the injection of Depomedrol and gave it to the patient at the request of Kunal on compassionate grounds. Dr. Halder accepted that Depomedrol is not the correct medicine for TEN and is used in acute medical condition.
We would, in view of the difference of opinion amongst experts as noticed by us heretoabove in some detail, proceed on the assumption that steroid can be administered in the TEN patients. However, it is clear from the opinion of the pro-steroid experts that:

(i) The nature of steroid which should be used is corticosteroid meaning thereby methyl prednisolone.
(ii) It should be used only at the early stages for a few days and then should be stopped or tapered to avoid the effect of immunosuppresion as also sepsis.
(iii) Supportive treatment must be administered.
(iv) It should be individually tailored according to the patients’ need.
Supportive treatment is also advised by Dr. Pasricha and others.
Two factors, however, must be noticed at this juncture :
(i) The chemical composition of Depomedrol is different from other type of glucocorticosteroid inasmuch as Depomedrol is methyl prednisolone acetate and glucocorticosteroid is methyl prednisolone sodium succinate. The evidence of Kunal in this behalf is absolutely categorical and unequivocal.
(ii) All the authors are one in stating that their opinion is subject to the instructions given in the package insert of the medicine.

Kunal examined Dr. Anil Shinde as PW-8. He is the Manager, Medical Service of Pharmacia India Private Limited. Depomedorol is manufactured by Pharmacia and Upjohn, USA. The company is the distributor of the said product in India. The packet insert of Depomedrol reads as under:

“DOSAGE:-
The usual dosage for patients with Dermatalogic Lesions benefitted by systemic corticoid therapy is 40-120 MG of Methyl Prednisolone acetate administered intramuscularly at weekly intervals for 1-4 weeks. In acute severe dermatitis due to poison IV relief may result within 8-12 hrs following intramuscular administration of a single dose of 80-120 MG. In chronic Contact dermatitis, repeated injections at 5-10 day intervals may be necessary. Following intramuscular administration of 80-120 MG to asthmatic patient’s relief may result within 6-48 hrs and persist for upto 2 weeks. Intramuscular dosage will vary with the condition being treated when a prolonged effect is desired; the weekly dose may be calculated by multiplying the daily dose by 7 and given as a singular intramuscular injection. Dosage must be individualised according to the severity of the disease and the response of the patients. In general, the duration of the treatment should be kept as short as possible. Medical surveillance is necessary.

PROPERTIES After a single IM injection of 40-80 MG of Depomedrol, duration of HPA Axis suppression ranges from 4-8 days. An intra-articular injection of 40 MG in both knees given after 4-8 hrs methyl prednisolone peaks of approximately 21.5 micrograms/ 100 ML. After intrarticular administration, methyl prednisolone acetate defuses from the joint into systemic circulation over approximately 7 days as demonstrated by the duration of HPA Axis suppression and by the serum Methyl Prednisolone Values.
INDICATIONS For Intramuscular administration, Methyl Prednisolone acetate (Depomedrol) is not suitable for the treatment of acute life threatening conditions if a rapid hormonal effect of maximum intensity is required the IV administration of highly soluble methyl prednisolone sodium succinate (Solumedrol) is indicated.
PRECAUTION Since the complications of treatment with glucocorticoids are dependant on the size of the dose and the duration of treatment ,a risk/ benefit decision must be made in each individual case as to dose and duration of treatment and as to whether daily or intermittent therapy should be used.
Glucocorticoids may musk some signs of infection and new infections may appear during their use.
There may be decreased resistance and inability to localise infection when glucocorticoids are used.
Do not use intrarticulary, intra bursally or intra tendinous administration in the presence of acute infection. IM administration can only be considered after institution of an appropriate anti microbial treatment.”
The necessity of following the instructions given in the packet insert cannot be underestimated. Admittedly, the instructions in the said packet insert had not been followed in the instant case. EFFECT OF EXCESS DOSAGE There is, thus, a near unanimity that the doses of glucocorticosteroid and in particular Depomedrol were excessive. From the prescription of Dr. Mukherjee, it is evident that he not only prescribed Depomedrol injection twice daily, but had also prescribed Wysolone which is also a steroid having the composition of Methyl Predinosolone.

From the AMRI records, it would appear that while admitting the patient, it had categorically been noticed that both Depomedrol injection twice daily and Wysolone were being administered from 7th May, 1998 following the prescription of Dr. Mukherjee. It also now stands admitted that Dr. Prasad also prescribed the same medicine. From Dr. Mukherjee’s prescription dated 11.05.1998, it is furthermore evident that he had prescribed Wysolone 50 mg once daily for one week, 40 mg daily for next week and 30 mg daily for the third week. He had also prescribed Depomedrol injection 80 mg twice daily for two days. “Depomedrol”, is a “long acting” steroid recommended for the treatment of “chronic” clinical conditions like “asthma” or “arthritis” for its prolonged immnumosupressive action. The maximum recommended dose of Depomedrol is 40-120 mg at 1-4 week intervals as clearly mentioned by the drug manufacturer, Pharmacia. Dr. J.S. Pasricha, Prof. and Ex – head of Dermatology at the All India Institute of Medical Sciences (AIIMS) has categorically stated, “Depo – preparations are used for chronic diseases and not for acute disease like TEN. Secondly, Depo preparations are not to be used twice a day”.
In his deposition, Dr. Anil Gupta deposed that, he wrote to Pharmacia Upjohn, to know from them if the drug can be used in this fashion (as was done by the Kolkata doctors) in any clinical condition. In the reply sent by Dr. S.P.S. Bindra, it was stated that “our package insert on Depomedrol does not recommend the twice daily dose of injection Depomedrol 80 mg in any clinical condition”. Moreover he also testified to the cause of Anuradha’s death was due to Septicemia, which happened as a result of profound immuno – suppression, caused by overuse of steroid as prescribed by Dr. Mukherjee. Further cause of death of Anuradha was lack of supportive treatment and lack of care on the part of Dr. Abani Roycoudhuri and Dr. Halder and other attending Physicians.

In his deposition Dr. Anil Shinde stated that he was working as a Manager, Medical Service with Pharmacia India Pvt. Ltd and elucidated the details of Depomedrol. He stated that the dosage should be between 40 to 120 mg once a week or once in two weeks. On questioned whether 80 mg of Depomedrol can be given twice daily, the answer was “No”.
In his deposition Dr. Salil Kumar Bhattacharya stated that he was a ] Professor of Pharmacology. On being questioned whether he is aware of the Drug Depomedrol and its usage, it was answered that “it is usually used in chronic clinical condition like Bronchial Asthama and Rheumatoid Arthritus”. On being questioned whether Depomedrol can be used for TEN, the answer was “No” He furthermore stated that the recommended usage is 40 to 120 mg. at intervals of at least 1 week and a daily dose of 80 mg can never be used. On the question whether `long acting’ steroids can accumulate in the body, he replied `Yes, it can accumulate.’ On being questioned, whether it is discretion of the Physician to decide the mode of administration of any drug, he answered that the choice is “prerogative”. However, he has to follow the pharmaco- therapeutic norms of the drug chosen.
SUPPORTIVE THERAPY No symptomatic therapy was administered. No emergency care was provided. Dr. Halder himself accepted that the same was necessary. This has also been stated by Roujeau and Revuz in their book in the following terms:

“Withdrawal of any suspect drug, avoidance of skin trauma, inserting a peripheral venous line, administration of macromolecular solution, direct the patient to burn unit or ICU.”

AMRI records demonstrate how abysmal the nursing care was. We understand that there was no burn unit in AMRI and there was no burn unit at Breach Candy Hospital either. A patient of TEN is kept in ICU. All emphasis has been laid on the fact that one room was virtually made an ICU. Entry Restrictions were strictly adhered to. Hygiene was ensured.
But constant nursing and supervision was required. In the name of preventing infection, it cannot be accepted that the nurses would not keep a watch on the patient. They would also not come to see the patients or administer drugs. No nasogastric tube was given although the condition of mouth was such that she could not have been given any solid food. She required 7 to 8 litres of water daily. It was impossible to give so much water by mouth. The doctors on the very first day found that condition of mouth was bad.

The ENT specialist in his prescription noticed blisters around the lips of the patient which led her to difficulty in swallowing or eating.
No blood sample was taken. No other routine pathological examination was carried out. It is now beyond any dispute that 25-30% body surface area was affected (re. prescription of Dr. Nandy, Plastic Surgeon) The next day, he examined the patient and he found that more and more body surface area was affected. Even Dr. Prasad found the same.
Supportive therapy or symptomatic therapy, admittedly, was not administered as needle prick was prohibited. AMRI even did not maintain its records properly. The nurses reports clearly show that from 13th May onwards even the routine check-ups were not done. LINE OF TREATMENT Kunal and Anuradha came on a vacation to Calcutta on 1st April, 1998, principally to attend a wedding in the family. Anuradha supposedly, after eating some Chinese food in some restaurant, developed fever and skin rash on or about 25.4.1998. Respondent No.1, Dr. Sukumar Mukherjee, indisputably is a very reputed Physician. He was a Professor of Medicine in Calcutta Medical College. Anuradha and Kunal were advised to consult him.

Respondent No.1 examined Anuradha at her residence in the evening of 26th April, 1998. He suggested certain pathological examinations. On that date no medicine was prescribed. Two weeks thereafter i.e. on or about 7th May, 1998, Respondent No.1 was informed by Kunal Saha that Anuradha’s condition had deteriorated and the skin rash and fever were back. She was taken to his chamber at 11, Shakespeare Sarani, Calcutta. Maculopropular rash, palpable penpina, enlarged neck glands were found to be present. She was diagnosed to be suffering from `Anglo-Neurotic Oedema with allergic vasculitis’. Respondent No.1 prescribed Depomedrol stat (immediately) injection 80 mg. on a twice daily schedule(B.I.D) for 3 days to be followed by other oral steroids. One injection was given by him.
Despite the institution of Depomedrol, Anuradha’s condition worsened from bad to worse in the next few days and Dr. Kunal Saha, contacted Respondent No. 1 from time to time for advice on telephone, who, however, insisted on continuing Depomedrol in the same dose. Anuradha was said to have also examined by two Consulting Dermatologists – Dr. A.K. Ghoshal and Dr. S. Ghosh, who diagnosed disease to be a case of Vasculitis. The injection, as suggested by Respondent No.1, however, was continued to be given.

On or about 11th May, 1998 Respondent No.1 was informed by Kunal that his wife’s condition had not been improving. The skin rash was persisting alongwith the fever and palpable neck glands whereafter he was recommended that Anuradha be hospitalised immediately. On the same date Anuradha was admitted in the Advanced Medicare Research Institute (AMRI) (Respondent No. 4). On being admitted she was examined by Dr. Balaram Prasad, Respondent No.5, who also continued with the injection of Depo-Medrol 80 mg.(2 ml.) I/M B.D. x 1 day.

Anuradha was examined by Respondent No.1 at 2.15 p.m. on the same date. The prescription provided for Inj. ‘Depomedrol’ 80 mg IM twice daily x 2 days (then 40 mg IM twice x days) among other things.
On the basis of the said advise Anuradha was examined by Consultant Dermatologist Dr. A.K. Ghoshal. Anuradha was diagnosed to be suffering from TEN. The bed ticket reads as under :-

“Toxic Epidermal Necrolysis.
Separation of large sheets of skin from back and limbs, many small/ large bulla on limbs. Dusky red areas of vasculitis almost all over the body. Mild conjunctivitis. Erosive lesions on tongue and buccal mucosali.
Adv.
Maintain fluid and electrolyte balance. Maintain maximum asepsis.
Continue same medicines.
Soframycin cream to apply on rash areas only Capsule Zevit – 1 Cap daily To be reviewed later.”

Respondent No.3, Prof. Dr. Abani Roy Chowdhury, Consultant, as recommended by Respondent No.12 was also consulted on 12th May, 1998. It is however, stated that he did not examine the patient as he had not been contacted by the hospital. Anuradha was also examined by Respondent No.2, Dr. Baidyanath Halder, a Consultant Dermatologist of fame and author of several Books on Skin Disorders. He also diagnosed that it could be a case of TEN. He recommended treatment with Steroids like Pedmeslan and and others and the application of ointments. Dr Halder found that Anuradha was suffering from Erithima plus blisters. However, no abnormality in the eyes or lungs was detected. He, although opined that an electrolytic balance of the patent should be maintained and steps should be taken to prevent any secondary infection, but did not prescribe any medicine or indicated the steps to be taken therefor.

Dr. Prasad referred the patient to the following Consultants.
(i) Dr. K. Nandy – a Plastic Surgeon ;

(ii) Dr. Purnima Chatterjee – a Gynecologist ;

(iii) Dr. S. Ahmed – an E.N.T. Surgeon ;

(iv) Dr. S. Bhattacherjee ; and

(v) Dr. N. Iqbal – General Surgeon.

Her condition deteriorated further. On or about 17th May, 1998 Kunal was advised to shift Anuradha to Breach Candy Hospital, Mumbai. For the aforementioned purpose Respondent No.2 issued a certificate. Three words in the said certificate, namely – “for better treatment” were said to be added. A Chartered Plane was arranged for taking Anuradha to Mumbai from Kolkata on 17th May, 2009. She was admitted in the said hospital at about 9.30 p.m. On her admission to the Breach Candy Hospital, it was recorded inter alia :-

“Mrs. Anuradha Saha has been admitted to Breach Candy Hospital, on 17.5.98 at night – 9.30 PM. Her condition on admission is serious. She has been accompanied by her husband Dr. Saha, who has given the history of antibiotic injection for respiratory tract injection – Rovamycin, Routhromycin, Ampicillin and Ampiclox and Nemuslide followed by development of Toixc Epidermal Necrolysis. She has received T Prednisolone 120 mg/day for 7 days and also Inj. Depomedrol Im x 3 days. She has been hemodynamically stable till now. She is able to swallow liquids, which has been her only nourishment over the past few days.”

She was examined by Dr. Farokh E. Udwadia at the Breach Candy Hospital in the afternoon of 18th May, 1998. His diagnosis was as under :-
“Patient has come with a diagnosis Toxic Epidermal Necrolysis (TEN). She has had a number of drugs at Calcutta form antibiotics to non-steroid and inflammatory agents. Is there any way of distinguishing this from a Stevens & Johnson Syndrome? There is no skin left. The mucus of the mouth, genitals and area is also severely affected. And have not seen the evolution of the skin lesions to the point where there is now no skin left. So far there is no organ evolvement in particular. No pulmonary lesions nor any urinary lesions (organs commonly involved as in a Steven Johnson Syndrome). In any case the basic management is the same. I do feel that the dose of steroids used in Calcutta is either excessive – 120 mg. Daily for a number of days, preceded by 80 mg Depomedral Injections. I would not give more than 40 mg /day Kg. body weight.”

On the same date Kunal’s brother who is also a doctor practicing in U.S.A. flew to Mumbai. He brought with him a new antibiotic known as “Quinolone”. There was some difference of opinion between the brother-in- law of Anuradha and Dr. Udwadia, which was noted by Dr. Udwadia. It reads as under :-

“He was claiming of blood transfusion – insisted that his blood or the relatives or friends blood be used – no objection. But I have requested that this is done quietly. The advice was to give whole blood. My view is that `blood’ is being used to increase Hb., and it is unusually accepted that to do so one gives packed cell and not whole blood. He was also advising the use of Erthropoitin as a marrow stimulant. My view was that at the point of time Erythropeitin will make no difference to her condition. To increase her Hb., from the present and Requested packed RBC infusions.
He was keen on immediately giving a tonic supplement. In my experience at this point of time, Zinc supplement was not of immediate importance that if gut was working and her external feed could be increased, she would receive sufficient tonic.”

However, some differences between Kunal and his elder brother on one hand and Dr. Udwadia persisted. He noted as under :-
“Have had great problems with the husband and brother-in-law. It is with great difficulty that I have controlled myself. When presented with his arrogance and condescends – merely and solely for the patient’s sake. To keep the peace, I have compromised on the following:
To allow the use of Erythropoeitin. I reasoned that though it cannot do much good, it does not do harm.
To allow the use of a Zinc preparation – totally unnecessary but not likely to lead to Zinc poisoning.
I would not allow parental alimentation through the same central line as fluids and electrolytes as I feel that gut if viable used at IV alimentation at this point of time may add to her hazards”.

Her condition was better during 24th May and 25th May, 1998. She, however, breathed her last on 28th May, 1998.

NOSOCOMIAL INFECTIONS:

Nosocomial infections are infections which are a result of treatment in a hospital or a healthcare service unit, but secondary to the patient’s original condition. Infections are considered nosocomial if they first appear 48 hours or more after hospital admission or within 30 days after discharge. Thus it becomes the liability of the hospital to prevent such infection specially in the cases where the patient has high risk of infection due to the nature of disease suffered.

AMRI as also the other respondents say that the room was made infection free. Certain restrictions on the visitors had also been taken. It is, however, not disputed that the dressing of body surface by Dr. Kaushik Nandy started only on 13th May, 1998. What type of dressing was to be done is a matter of dispute. We may not go into the said question. But, we must notice that in Breach Candy Hospital, the dressing was done in operation theatre, firstly, on 18th May, 1998 and then on all subsequent days. No dressing was done at AMRI in operation theatre.
It is now almost accepted worldwide that the hospital is liable to prevent such infections specially in the case where the patient has high risk thereof due to the nature of the disease suffered. It also almost stands established that use of Depomedrol and other high dose of glucocorticosteroid may first lead to immunosuppression which may in turn lead to septisis.

In April, 1998, when she started suffering, she had skin rash. By the time, she came to AMRI on 11th May, 1998, 25-30% of body surface area was infected. Admittedly, by 14th May, 1998, her entire body except the skull denuded of skin. Plastic Surgeon at Breach Candy Hospital who had been doing the dressings on 19th May, 1998 stated that green tinge had appeared on the back. Such a green tinge would not occur within a day. Thus, infection was widespread. It might have been controlled to some extent at Breach Candy Hospital. In the said hospital, the entire body was put in bandage without leaving any part of the body open. It is only with a view to control such bacterial infection, the antibiotics were administered.

C.3. FINDINGS AND ANALYSIS WITH RESPECT TO SO CALLED CLEAVAGE OF OPINION FINDINGS ON SO CALLED CLEAVAGE OF OPINION

Appellant, thus, has placed on record the view points of experts – both of the pro-steroid and anti-steroid group. Would it amount to cleavage of opinion so as to enable the court to arrive at a safe conclusion that no negligence is proved or there was no deficiency in service? In other words, the question is as to whether the treatment of Anuradha was in accordance with the medical protocol. In our opinion, the answer must be rendered in the negative. Those who support use and administration of steroid do so with note of caution. They in no uncertain terms state that the same should be used at a preliminary stage. Respondents do not spell out as to what would be the preliminary stage. The preliminary stage must have started with the onset of the disease. She had been suffering from skin rash from 3rd week of April, 1998. It increased with the passage of time. The cause of such eruption was not ascertained. In fact what caused the onset of disease was not known. It may be from Chinese food or it may even be from use of vitamin.

On and from 7th May, 1998, she was prescribed injection Depomedrol twice a day and Wysolone. It was continued upto 13th May, 1998, nobody even thought of stopping the injection. Dr. Halder although stopped Depomedrol injection from 13th May, 1998, but prescribed a high dose of steroid.

No doctor posed unto themselves a basic question why despite use of steroid, condition of the patient was going from bad to worse. It is agreed across the board and at least during trial, that supportive treatment should have been given. The medicine was propagated which did not exist. The medical literatures were not consulted. Even for pulse therapy Depomedrol could not have been used and only Solumedrol could have been used. Kunal in his evidence explained the difference between the two. Dr. Mukherjee in his deposition indirectly accepted the same. Each of those pro-steroid group spoke of a single injection. Nobody suggested on the face of the voluminous medical literature and authoritative opinions of the experts that two injections daily could be prescribed by any prudent physician. A great deed of confusion was sought to be created between one kind of steroid and another. Vague questions were asked from the experts to show that steroids may be used but Dr. Pasricha stated that only a quick acting steroid should be used. Depomedrol is not a quick acting steroid.
Kunal in his evidence categorically stated so in the following terms:
“Prednisolone can be used daily at 200 mgs for multiple sclerosis. But if instead of Prednisolone, Depomedrol which is Methyl Prednisolone Acetate is used to this patient he or she is likely to die. Depomedrol is not Prednisolone. And majority of the dermatologists in the West do not do not use any steroid whatsoever on TEN patients.” “However there is no controversy even among the “Pro-steroid” dermatologists that once more than 20% of the BSA is affected no steroid should be used as it would only enhance the chance of development of septicemia and death.”
ANALYSIS The High Court as also the Commission principally proceeded on the premise that the respondents herein are not liable either for any act of criminal misconduct or negligence because of cleavage of opinion. The cleavage of opinion, if any, as we have noticed hereinbefore, is between pro- steroid group and anti-steroid group. Accepted treatment protocol so far as the pro-steroid group is concerned has also been noticed by us. We have proceeded to determine the question of negligence on the part of the respondents herein principally on the premise that even if the opinion of the pro-steroid group is followed, the respondents have failed and/or neglected to even act strictly in terms of the treatment protocol laid down by them. The opinion of the anti-steroid group appears to be more scientific and structured but the same by itself, we are conscious of the fact, would not lead us to the conclusion that the respondents are guilty of gross negligence.
We may, however, notice that Mr. Fitz Patrick in his book Dermatology in General Medicine (5th Edition), inter alia, opined as under:-
“Treatment:
2. According to our view, agreement should be used on following for the treatment of TEN:
a. Treatment in burn units should be strived for in exceptional cases but is not generally necessary.
b. Treatment has to be individually tailored according to cause type and stage and presence and type of complications.
c. Systemic glucocorticoids should not be used routinely but are justified in the early stages of drug induced TEN. They should be given in doses from 80 to 120 mg of methlypredisolone per day by mouth, for several days until disease progression has ceased. Dosages should be tapered quickly and cautiously since no further benefit can be expected thereafter and the untoward effects may then predominate.
d. Treatment may focus on early detection and prevention of the most fatal complication e.g. overwhelming infection. Cultures from skin and mucosal erosions, must be regularly performed.
e. Blood gases and fluid, electrolytes and protein balance must be monitored and adjusted appropriately. Fluid replacement regimens as used for burn patients.
f. Supportive care is of great importance and particular attention must be paid to a high calorie and high – protein diet.
g. Debridgement of necrotic skin should not performed before disease activity ceases.
3. Course and Prognosis: The following factors appear to be unfavourable prognostic signs: old age, extensive skin lesions, nuetropenia, impaired renal function and intake of multiple drugs. Septesemia, gastrointestinal hemorrhage, pnuemoina and fluid and electrolyte imbalance leading to renalinsufficiency are major complications leading to death.”
As noticed hereinbefore, precautions as also the course of actions suggested by the authors have not been undertaken by the respondents. It is to be noted that the learned authors’ expertise in the field is neither in doubt nor in dispute, particularly when both parties have extensively relied thereupon. Even the suspected offending drug was not withdrawn at later stages. This drug is considered to be a real risk for the patient suffering from TEN. The medicine has also been administered having regard to the physical condition of the patient. They were required to be given only as a part of the total program. We may also place on record that there has been a cleavage of opinion in regard to mortality rate. Whereas according to the one group of experts in TEN patients when properly treated and in particular given supportive treatment, the mortality rate is 0-10%’ the respondents contend that that in fact the mortality rate is quite high being 30-70%.
We would assume that the mortality rate is very high. If that be so, we feel that the doctors should have been more careful. They should have treated the patient upon exercise of more care and caution. For the said purpose, if they had not been able to diagnose the disease properly or identify the proper drug they would have undertaken some research. It is clear that they did not have any expertise in the field and therefore they ought not to have behaved as experts We are, therefore, of the opinion that the universally accepted medicated treatment protocol had also not been followed.
It is also to be noted at this juncture, that there may well be a difference of opinion on the course of action to be adopted while treating a patient of TEN, but the treatment line followed by Dr. Mukherjee which entailed administration of 80 mg of Depomedrol injection twice is not supported by any school of thought. The treatment line, in this case, does not flow from any considered affinity to a particular school of thought, but out of sheer ignorance of basic hazards relating to use of steroids as also lack of judgment.
C.4. BURDEN OF PROOF Kunal had not only obtained opinion of a large number of experts, he examined some of the including Dr. Anil Shinde P.W. 9,; Dr. Udwadia (P.W.10) and, Dr. Salil Kumar Bhattacharyya, P.W. 11.
Respondents did not examine any expert. They, however, relied upon some authorities to which we have referred to heretobefore. The onus of proof, therefore, on a situation of this nature shifted to the respondents.
While we say so we must place on record that we are not oblivious of the fact that the principle of res ipsa loquitur may not be strictly applicable in a criminal case, although certain authorities suggest application of the said principle.

In Spring Meadows Hospital v. Harjol Ahluwalia, [(1998) 4 SCC 39], this Court has held as under :-
“10. Gross medical mistake will always result in a finding of negligence. Use of wrong drug or wrong gas during the course of anaesthetic will frequently lead to the imposition of liability and in some situations even the principle of res ipsa loquitur can be applied. Even delegation of responsibility to another may amount to negligence in certain circumstances. A consultant could be negligent where he delegates the responsibility to his junior with the knowledge that the junior was incapable of performing of his duties properly.”

However, in Rattan Singh v. State of Punjab, [(1979) 4 SCC 719}, this Court has held :-
“3. This, however, does not excuse the accused from his rash driving of a “blind Leviathan in berserk locomotion”. If we may adapt the words of Lord Greene, M.R. : “It scarcely lies in the mouth of the truck driver who plays with fire to complain of burnt fingers”. Rashness and negligence are relative concepts, not absolute abstractions. In our current conditions, the law under Section 304-A IPC and under the rubric of Negligence, must have due regard to the fatal frequency of rash driving of heavy duty vehicles and of speeding menaces. Thus viewed, it is fair to apply the rule of res ipsa loquitur, of course, with care. Conventional defences, except under compelling evidence, must break down before the pragmatic Court and must be given short shrift. Looked at from this angle, we are convinced that the present case deserves no consideration on the question of conviction.”

In B. Nagabhushanam v. State of Karnataka, [(2008) 5 SCC 730],this Court held as under :-
“12. Reliance placed by Mr Kulkarni on Syad Akbar v. State of Karnataka1 is not apposite. It proceeded on the basis that res ipsa loquitur stricto sensu would not apply to a criminal case as its applicability in an action for injury by negligence is well known. In Syad Akbar this Court opined: (SCC p. 41, para 30):
“30. Such simplified and pragmatic application of the notion of res ipsa loquitur, as a part of the general mode of inferring a fact in issue from another circumstantial fact, is subject to all the principles, the satisfaction of which is essential before an accused can be convicted on the basis of circumstantial evidence alone. These are: Firstly, all the circumstances, including the objective circumstances constituting the accident, from which the inference of guilt is to be drawn, must be firmly established. Secondly, those circumstances must be of a determinative tendency pointing unerringly towards the guilt of the accused. Thirdly, the circumstances should make a chain so complete that they cannot reasonably raise any other hypothesis save that of the accused’s guilt. That is to say, they should be incompatible with his innocence, and inferentially exclude all reasonable doubt about his guilt.”
There cannot, however, be any doubt whatsoever that in the civil appeal the said principle is applicable. It has clearly been held by this Court that the onus of proof would shift on the respondents.

In Nizam Institute of Medical Sciences v. Prasanth S. Dhananka and others, [2009 (7) SCALE 407] this Court held as under :-
“32. We are also cognizant of the fact that in a case involving medical negligence, once the initial burden has been discharged by the complainant by making out a case of negligence on the part of the hospital or the doctor concerned, the onus then shifts on to the hospital or to the attending doctors and it is for the hospital to satisfy the Court that there was no lack of care or diligence. In Savita Garg (Smt.) v. Director, National Heart Institute it has been observed as under:
Once an allegation is made that the patient was admitted in a particular hospital and evidence is produced to satisfy that he died because of lack of proper care and negligence, then the burden lies on the hospital to justify that there was no negligence on the part of the treating doctor or hospital. Therefore, in any case, the hospital is in a better position to disclose what care was taken or what medicine was administered to the patient. It is the duty of the hospital to satisfy that there was no lack of care or diligence. The hospitals are institutions, people expect better and efficient service, if the hospital fails to discharge their duties through their doctors, being employed on job basis or employed on contract basis, it is the hospital which has to justify and not impleading a particular doctor will not absolve the hospital of its responsibilities.”

C.5. CONTRIBUTORY NEGLIGENCE

The High Court as also the Commission opined that the death of Anuradha took place not because of any negligence on the part of the doctors of AMRI but by reason of interference by Kunal Saha. It was on the insistence of Kuanl Saha that the patient was transferred to Bombay. It has been submitted that it was the infection which developed during transportation which ultimately proved fatal.

Interference by Kunal at AMRI was sought to be proved through Sutapa Chanda, Nursing Superintendant at AMRI, who appeared as DW-1. However, the statement of the said Nursing Superintendent in regard to the alleged interference by Kunal is not borne out from the record. As a matter of fact she had not been able to explain the medicines which were to be administered to her stating:-

“Q.38 (Ld. complainant counsel sows the witness Exbt. 8). What do you understand by this line “Fusys 200 mg. / weekly once”; – 3rd line from the end?
Ans. Regarding this question I like to say all instructions for mediction in Exbt. 8 were carried out by Dr. Kunal Saha but not by my nurses. If I can not understand this instruction I would have made queries and doctor would clear it. But I had no such chance to make queries regarding this.”

It is to be noted here that Nursing Superintendent being a professional cannot take this plea. Moreover, the same is not borne out of records at AMRI. Even if we assume this statement to be true, in a professional setting of this nature, these interferences should have been resisted by them. Interference cannot be taken to be an excuse for abdicating one’s responsibility especially when an interference could also have been in the nature of suggestion.
Same comments were said to have been made by Dr. Halder while making his statement under Section 313 of the Code of Criminal Procedure. They are admissible in evidence for the said purpose. Similarly the statements made by Dr. Mukherjee and Dr. Halder in their written statements before the National Commission are not backed by any evidence on record. Even otherwise, keeping in view the specific defence raised by them individually, interference by Kunal, so far as they are concerned, would amount to hearsay evidence and not direct evidence.
Dr. K. Nandy in his evidence stated that he was not allowed to change the dressings on 15th May and 16th May, 1998. However, according to him, he forced his decision to do the dressing on 17th May, 1998 before she was taken away from the hospital.
However, it appears from the AMRI records that the name of Kunal only appears once i.e. when he got Anuradha admitted in the hospital. His name is not borne out from any other record. So far as the statement of Dr. Nandy is concerned, Kunal’s explanation is that he did not follow the medical protocol in the matter of dressing. This may or may not be correct.
We may notice that whenever any interference in contrast to the AMRI was attempted to be made by the patient party at Breach Candy Hospital, it had scrupulously been placed on record. Wherever “Dr. Saha” appears in the record, it is evident that the same refers to the elder brother of Kunal, who is a surgeon. However, when there is any discussion with both the brothers, like in the case of Dr. Udwadia, it had been recorded `both of them’.

It is accepted that the elder brother of Kunal came to Mumbai on 17th May, 1998 itself. He brought with him a new antibiotic named “Quinolone” which was not available in India. He persuaded Dr. Udwadia to administer the said injection. This discussion between them has also been recorded. Some adverse remarks have also been recorded with regard to the conduct of Dr. Saha. Dr. Udwadia has noticed in the records of the Breach Candy Hospital that he tolerated the said conduct on the part of the elder brother of Kunal solely for the patient’s sake.
Though some of the suggestions of Dr. Saha did not seem particularly useful to Dr. Udwadia, but those measures which were not harmful to the patient were administered. We, however, may also notice that where Dr. Udwadia thought that there could be some harm to the patient, he did not agree thereto. He, therefore, acted in a professional manner.
We may also place on record that despite such elaborate and careful treatment meted out to Anuradha, her condition had been worsening; Dr. Udwadia even agreed to administer the injection “Quinolone” during her last day as he might have thought that there was no harm in trying the same at that juncture.
Respondents also sought to highlight on the number of antibiotics which are said to have been administered by Kunal to Anuradha while she was in AMRI contending that the said antibiotics were necessary. Kunal, however, submitted that the said antibiotics were prescribed by the doctors at AMRI and he did not write any prescription. We would, however, assume that the said antibiotics had been administered by Kunal on his own, but it now stands admitted that administration of such antibiotics was necessary.
To conclude, it will be pertinent to note that even if we agree that there was interference by Kunal Saha during the treatment, it in no way diminishes the primary responsibility and default in duty on part of the defendants. In spite of a possibility of him playing an over-anxious role during the medical proceedings, the breach of duty to take basic standard of medical care on the part of defendants is not diluted. To that extent, contributory negligence is not pertinent. It may, however, have some role to play for the purpose of damages.

C.6. NON-JOINDER OF NECESSARY PARTIES

Respondents contend that Dr. Kunal had been selective in prosecuting three principal doctors on the criminal side who allegedly treated Anuradha but some more before the Commission. Contending that no reason has been assigned as to why case against Dr. A.K. Ghoshal as also Breach Candy Hospital and doctors treating Anuradha at Bombay from 17th May, 1998 till 28th May, 1998 had been given up, the learned counsel urged that these appeals should be dismissed on that ground alone.
We are afraid that the aforementioned submission cannot be accepted in view of the decision of this Court in Smt. Savita Garg (supra), wherein it has been held:

” So far as the law with regard to the non- joinder of necessary party under Code of Civil Procedure, Order 1 Rule 9 and Order 1 Rule 10 of the CPC there also even no suit shall fail because of mis-joinder or non-joinder of parties. It can proceed against the persons who are parties before the Court. Even the Court has the power under Order 1 Rule 10(4) to give direction to implead a person who is a necessary party. Therefore, even if after the direction given by the Commission the concerned doctor and the nursing staff who were looking after the deceased A.K. Garg have not been impleaded as opposite parties it can not result in dismissal of the original petition as a whole.”

An argument has also been advanced that Anuradha was treated by as many as 16 doctors and, thus, there was no reason as to why only the respondents should have been proceeded against. Proceeding should be initiated both under the criminal law as also the tort law only against those who are specifically found to be guilty of criminal misconduct or medical negligence or deficiency in service and not against all. Apart from making a general submission, it has not been pointed out as to what difference would have been made if others were also impleaded as parties. The medical records were before the court. The hospital records of both AMRI and Breach Candy were also before it. AMRI records contained 22 pages, records of Breach Candy runs into more than 400 pages. No party had relied on any evidence other than those records as also the oral evidence and documentary evidence brought on record by them. Respondents have also not pointed out as to how treatment by any other doctor has contributed in any manner to the death of Anuradha.

Submissions have also been made at the bar that Kunal issued notices to a large number of persons but withdrew the cases against most of them. It was placed before us that in the first notice there were as many as 26 addresses and in the complaint filed before the National Commission, there were 19 addresses. Withdrawal of cases against some of them, in our opinion, is not of much significance. The Directors of AMRI were impleaded as parties. Cases against them had also been withdrawn and, in our opinion, rightly so as most of them were liable in their personal capacity. Dr. Kunal says that the proceeding against Breach Candy Hospital and doctors treating Anuradha had been withdrawn as the principal grievance against the hospital was that they did not have any burn ward although he was already informed thereabout. Burn ward was also not there in AMRI. In fact, it was brought on record that no nursing home in Calcutta has a separate burn ward. Absence of burn ward by itself, thus, might not be a contributory factor although existence thereof was highly desirable keeping in view the treatment protocol.

We must bear in mind that negligence is attributed when existing facilities are not availed of. Medical negligence cannot be attributed for not rendering a facility which was not available. In our opinion, if hospitals knowingly fail to provide some amenities that are fundamental for the patients, it would certainly amount to medical malpractice. As it has been held in Smt. Savita Garg (supra), that a hospital not having basic facilities like oxygen cylinders would not be excusable. Therein this Court has opined that even the so-called humanitarian approach of the hospital authorities in no way can be considered to be a factor in denying the compensation for mental agony suffered by the parents. The aforementioned principle applies to this case also in so far as it answers the contentions raised before us that the three senior doctors did not charge any professional fees.
In any event, keeping in view of the said decision, we are of the firm opinion that notices to a large number of persons and withdrawal of cases against some of them by itself cannot be considered to be a relevant factor for dismissal of these appeals.

D. CIVIL LIABILITY UNDER TORT LAW AS ALSO UNDER CONSUMER PROTECTION ACT

In this case, we are concerned with the extent of negligence on the part of the doctors, if any, for the purpose of attracting rigours of Section 304A of the Indian Penal Code as also for attracting the liability to pay compensation to the appellant in terms of the provisions of the Consumer Protection Act, 1986. We intend to deal with these questions separately.
It is noteworthy that standard of proof as also culpability requirements under Section 304 -A of Indian Penal Code stands on an altogether different footing. On comparison of the provisions of Penal Code with the thresholds under the Tort Law or the Consumer Protection Act, a foundational principle that the attributes of care and negligence are not similar under Civil and Criminal branches of Medical Negligence law is borne out. An act which may constitute negligence or even rashness under torts may not amount to same under section 304 – A.

Bearing this in mind, we further elaborate on both the questions separately.

D.1. LAW OF NEGLIGENCE UNDER TORT LAW

Negligence is the breach of a duty caused by the omission to do something which a reasonable man, guided by those considerations which ordinarily regulate the conduct of human affairs would do, or doing something which a prudent and reasonable man would not do. [See Law of Torts, Ratanlal & Dhirajlal Twenty-fourth Edition 2002, at p.441-442] Negligence means “either subjectively a careless state of mind, or objectively careless conduct. It is not an absolute term but is a relative one; is rather a comparative term. In determining whether negligence exist in a particular case, all the attending and surrounding facts and circumstance have to be taken into account.” [See Municipal Corpn. Of Greater Bombay v. Laxman Iyer, (2003) 8 SCC 731, para 6; Adavanced Law Lexicon, P Ramanatha Aiyar, 3rd ed. 2005, p. 3161] Negligence is strictly nonfeasance and not malfeasance. It is the omission to do what the law requires, or the failure to do anything in a manner prescribed by law. It is the act which can be treated as negligence without any proof as to the surrounding circumstances, because it is in violation of statute or ordinance or is contrary to the dictates of ordinary prudence.

In Bolam v. Friern Hospital Management Committee, [(1957) 2 All ER 118], the law was stated thus:

“Where you get a situation which involves the use of some special skill or competence, then the test…..is the standard of ordinary skilled man exercising and professing to have that special skill. A man need not possess the highest expert skill; it is well-established law that it is sufficient if he exercises the ordinary skill of an ordinary competent man exercising that particular art….
[A doctor] is not guilty of negligence if he has acted in accordance with a practice accepted as proper by a responsible body of medical men skilled in that particular art….Putting it the other way round, a [doctor] is not negligent, if he [has acted] in accordance with such a practice, merely because there is a body of opinion which [takes] a contrary view.”

It has been laid down that an ordinary skilled professional standard of care for determining the liability of medical professional should be followed. (See Maynard v. West Midland Regional Health, Authority, [(1985) 1 All ER 635 (HL)]) Recently in Martin F.D’ Souza v. Mohd. Ishfaq, [ (2009) 3 SCC 1], this Court laid down the precautions which doctors/hospitals etc. should have taken, in the following terms :-

“(a) Current practices, infrastructure, paramedical and other staff, hygiene and sterility should be observed strictly….
(b) No prescription should ordinarily be given without actual examination. The tendency to give prescription over the telephone, except in an acute emergency, should be avoided.
(c) A doctor should not merely go by the version of the patient regarding his symptoms, but should also make his own analysis including tests and investigations where necessary.
(d) A doctor should not experiment unless necessary and even then he should ordinarily get a written consent from the patient.
(e) An expert should be consulted in case of any doubt….”

In fact, the Bolam case in common laws jurisdictions is weakened in recent years by reasons of series of decisions in Australia [Rogers v. Whitaker: (1992) 109 Aus LR 625 and Roenbreg v. Percival 2001 HCA 18]; Canada [Ribl v. Hughes: (1980) 114 DLR 3d 1] and the United States and even in the United Kingdom.

We may refer to Bolitho v. City and Hackney Health Authority, [(1997) 4 All ER 771 (HL)], where the Court got away from yet another aspect of Bolam case. It was observed :-

” The court is not bound to hold that a defendant doctor escapes liability for negligent treatment or diagnosis just because he leads evidence from a number of medical experts who are genuinely of opinion that the defendant’s treatment or diagnosis accorded with sound medical practice. The use of these adjectives –
responsible, reasonable and respectable – all show that the court has to be satisfied that the exponents of the body of opinion relied upon can demonstrate that such opinion has a logical basis. In particular in cases involving, as they so often do, the weighing of risks against benefits, the judge before accepting a body of opinion as being responsible, reasonable and respectable, will need to be satisfied that, in forming their views, the experts have directed their minds to the question of comparative risks and benefits and have reached a defensible conclusion on the matter.”
In this regard it would be imperative to notice the views rendered in Jacob Mathew v. State of Punjab, [(2005) 6 SCC 1, where the court came to the conclusions:

(i) Mere deviation from normal professional practice is not necessarily evidence of negligence.
(ii) Mere accident is not evidence of negligence
(iii) An error of judgment on the part of a professional is not 7negligence per se.
(iv) Simply because a patient has not favourably responded to a treatment given by a physician or a surgery has failed, the doctor cannot be held liable per se by applying the doctrine of res ipsa loquitor.

RIGHT OF THE PATIENT TO BE INFORMED

The patients by and large are ignorant about the disease or side or adverse affect of a medicine. Ordinarily the patients are to be informed about the admitted risk, if any. If some medicine has some adverse affect or some reaction is anticipated, he should be informed thereabout. It was not done in the instant case.

In Sidaway v. Board of Governors of Bethlem Royal Hospital and the Maudsley Hospital, [ [1985] All ER 643 ], the House of Lords, inter alia held as under :-

“The decision what degree of disclosure of risks is best calculated to assist a particular patient to make a rational choice as to whether or not to undergo a particular treatment must primarily be a matter of clinical judgment.
An issue whether non-disclosure of a particular risk or cluster of risks in a particular case should be condemned as a breach of the doctor’s duty of care is an issue to be decided primarily on the basis of expert medical evidence. In the event of a conflict of evidence the judge will have to decide whether a responsible body of medical opinion would have approved of non-disclosure in the case before him.
A judge might in certain circumstances come to the conclusion that disclosure of a particular risk was so obviously necessary to an informed choice on the part of the patient that no reasonably prudent medical man would fail to make it, even in a case where no expert witness in the relevant medical field condemned the non-disclosure as being in conflict with accepted and responsible medical practice.”

The law on medical negligence also has to keep up with the advances in the medical science as to treatment as also diagnostics. Doctors increasingly must engage with patients during treatments especially when the line of treatment is a contested one and hazards are involved. Standard of care in such cases will involve the duty to disclose to patients about the risks of serious side effects or about alternative treatments. In the times to come, litigation may be based on the theory of lack of informed consent. A significant number of jurisdictions, however, determine the existence and scope of the doctor’s duty to inform based on the information a reasonable patient would find material in deciding whether or not to undergo the proposed therapy. [See Canterbury v. Spence, 464 F.2d 772 (D.C. Cir. 1972), cert. denied, 409 U.S. 1064 (19r72); see also Cobbs v. Grant, 8 Cal. 3d 229, 104 Cal. Rptr. 505, 502 P.2d 1 (1972); Hamiltorn v. Hardy, 37 Colo. App. 375, 549 P.2d 1099 (1976)]. In this respect, the only reasonable guarantee of a patient’s right of bodily integrity and self-determination is for courts to apply a stringent standard of disclosure in conjunction with a presumption of proximate cause. At the same time, a reasonable measure of autonomy for the doctor is also pertinent to be safeguarded from unnecessary interference.

D.2. TRANSPORTATION

So far as transportation of Anuradha from Kolkata to Mumbai is concerned, we must place on record that a certificate in that behalf was given by Dr. Baidyanath Halder correctness whereof, except for the words “for better treatment” is not in dispute. Dr. Halder does not contend that the contents of the same are wrong. He merely says that the same was issued at the instance of the patient. The submission of Dr. Halder that he had issued the certificate without seeing the patient cannot be believed. If that be so, such a certificate could have been issued by Dr. Balram Prasad and/or any other doctor. Why he had taken the burden of issuing such a certificate is not explained.
We are of the opinion that a conclusion as to whether the words “for better treatment” have been inserted in the said certificate or not or the same was done at the instance of Kunal, is wholly unnecessary for our purpose. The only question which arises is as to whether there was any risk of Anuradha developing infection due to exposure during transportation. She was flown to Mumbai by an exclusive chartered flight (air ambulance) of East-West Rescue of Delhi. Kunal had to pay about $ 2000 for the said purpose. Respondents did not suggest that the service provided by the said airlines was of inferior character or sufficient precautions were not taken during transportation. In fact, the condition of Anuradha was so critical that there was no other option but to take her to a better hospital. Her transportation to Mumbai was necessary and was not an act borne out of desperation alone.
We may notice that even a couple of Kunal’s friends, who were doctors, came to Mumbai by Jet Airways flight.
It appears that East West Rescue of Delhi, which provided air ambulance, must have taken all necessary precautions. Although lot of literature on the subject relating to the services of the said airlines showing that it is considered to be one of best in the world is available, we refrain from dealing with the same, as it is not necessary.
Dr. Udwadia made a comment that transportation of Anuradha from Kolkata to Mumbai may have exposed her to infection. He, however, added a proviso thereto – unless better care was taken. There was no reason as to why the proper care was not taken, particularly seeing her condition. There is no evidence on record leading to an opposite conclusion. Dr. Nandy, stated dressing was necessary before transportation. He must have done so keeping in view the necessity of prevention of further infection during flight. At Bombay, Dr. Kulkarni noticed a green patch showing old infection. It must have escaped the notice of even Dr. Nandy. Dr. Kulkarni noticing the same, observed that the patient’s condition was worse than he anticipated.

D.3. LEGITIMATE EXPECTATION Kunal approached the best doctors available. He admitted his wife at AMRI on the recommendation of Dr. Mukherjee, evidently, expecting the best possible treatment from the renowned doctors and a renowned hospital. It was not too much for a patient to expect the best treatment from the doctors of the stature of Dr. Mukherjee, Dr. Halder and Dr. Abani Roy Chowdhury. Services of other experts in fields were requisitioned by the Hospital. References were made and the Hospital on the basis of the recommendations made by the doctors themselves consulted the best doctors in their respective fields. Kunal or Anuradha or his relatives never interfered therewith. They did not call any doctor of their choice to the Hospital. In fact, after Dr. A.K. Ghoshal came to know that Anuradha was suffering from TEN, he suggested a line of treatment which was not adhered to keeping in view the fact that Dr. Halder and hospital authorities were in charge of the case.

The standard of duty to care in medical services may also be inferred after factoring in the position and stature of the doctors concerned as also the hospital; the premium stature of services available to the patient certainly raises a legitimate expectation. We are not oblivious that the source of the said doctrine is in administrative law. A little expansion of the said doctrine having regard to an implied nature of service which is to be rendered, in our opinion, would not be quite out of place.

AMRI makes a representation that it is one of the best hospitals in Calcutta and provides very good medical care to its patients. In fact the learned Senior Counsel appearing on behalf of the respondents, when confronted with the question in regard to maintenance of the nurses register, urged that it is not expected that in AMRI regular daily medical check-up would not have been conducted. We thought so, but the records suggest otherwise. The deficiency in service emanates therefrom. Even in the matter of determining the deficiency in medical service, it is now well- settled that if representation is made by a doctor that he is a specialist and ultimately it turns out that he is not, deficiency in medical services would be presumed.

We may notice some of the decisions in this behalf. In Smt. Savita Garg v. The Director, National Heart Institute [2004 (8) SCALE 694 : (2004) 8 SCC 56], this Court opined:

“It is the common experience that when a patient goes to a private clinic, he goes by the reputation of the clinic and with the hope that proper care will be taken by the Hospital authorities. It is not possible for the patient to know that which doctor will treat him. When a patient is admitted to a private clinic/ hospital it is hospital/ clinic which engages the doctors for treatment. …They charge fee for the services rendered by them and they are supposed to bestow the best care.”

D.4. INDIVIDUAL LIABILITY OF THE DOCTORS

There cannot be, however, by any doubt or dispute that for establishing medical negligence or deficiency in service, the courts would determine the following:

(i) No guarantee is given by any doctor or surgeon that the patient would be cured.

(ii) The doctor, however, must undertake a fair, reasonable and competent degree of skill, which may not be the highest skill.
(iii) Adoption of one of the modes of treatment, if there are many, and treating the patient with due care and caution would not constitute any negligence.
(iv) Failure to act in accordance with the standard, reasonable, competent medical means at the time would not constitute a negligence. However, a medical practitioner must exercise the reasonable degree of care and skill and knowledge which he possesses. Failure to use due skill in diagnosis with the result that wrong treatment is given would be negligence.
(v) In a complicated case, the court would be slow in contributing negligence on the part of the doctor, if he is performing his duties to be best of his ability.
Bearing in mind the aforementioned principles, the individual liability of the doctors and hospital must be judged.

We enumerate heretobelow the duty of care which ought to have been taken and the deficiency whereof is being complained of in the criminal case and the civil case, respectively, so far as respondent Nos. 1 to 3 are concerned.

When Dr. Mukherjee examined Anuradha, she had rashes all over her body and this being the case of dermatology, he should have referred her to a dermatologist. Instead, he prescribed “Depomedrol” for the next 3 days on his assumption that it was a case of “vasculitis”. The dosage of 120 mg Depomedrol per day is certainly a higher dose in case of a TEN Patient or for that matter any patient suffering from any other bypass of skin disease and the maximum recommended usage by the drug manufacturer has also been exceeded by Dr. Mukherjee. On 11th May, 1998, the further prescription of Depomedrol without diagnosing the nature of the disease is a wrongful act on his part.

According to general practice, long acting steroids are not advisable in any clinical condition, as noticed hereinbefore. However, instead of prescribing to a quick acting steroid, the prescription of a long acting steroid without foreseeing its implications is certainly an act of negligence on his part without exercising any care or caution. As it has been already stated by the Experts who were cross examined and the authorities that have been submitted that the usage of 80-120 mg is not permissible in TEN.
Furthermore, after prescribing a steroid, the effect of immunosuppression caused due to it, ought to have been foreseen. The effect of immunosuppression caused due to the use of steroids has affected the immunity of the patient and Dr. Mukherjee has failed to take note of the said consequences.

After taking over the treatment of the patient and detecting TEN, Dr. Halder ought to have necessarily verified the previous prescription that has been given to the patient. On 12th May, 1998 although `depomedrol’ was stopped, Dr. Halder did not take any remedial measures against the excessive amount of `depomedrol’ that was already stuck in the patient’s body and added more fuel to the fire by prescribing a quick acting steroid `Prednisolone’ at 40mg three times daily, which is an excessive dose, considering the fact that a huge amount of “Depomedrol” has been already accumulated in the body.

Life saving `supportive therapy’ including IV fluids/ electrolyte replacement, dressing of skin wounds and close monitoring of infection is mandatory for proper care of TEN patients. Skin(wound) swap and blood tests also ought to be performed regularly to detect the degree of infection. Apart from using the steroids, aggressive supportive therapy that is considered to be rudimentary for TEN patients was not provided by Dr. Halder. Further `vital-signs’ of a patient such as temperature, pulse, intake- output and blood pressure were not monitored. All these factors are considered to be the very basic necessary amenities to be provided to any patient, who is critically ill. The failure of Dr. Halder to ensure that these factors are monitored regularly is certainly an act of negligence.
Occlusive dressing were carried as a result of which the infection had been increased. Dr Halder’s prescription was against the Canadian treatment protocol reference to which we have already made herein before.
It is the duty of the doctors to prevent further spreading of infections. How that is to be done is the doctors concern. Hospitals or nursing homes where a patient is taken for better treatment should not be a place for getting infection.

After coming to know that the patient is suffering from TEN, Dr. Abani Roy Chowdhury ought to have ensured that supportive therapy had been given. He had treated the patient along with Dr. Halder and failed to provide any supportive therapy or advise for providing IV fluids or other supplements that is a necessity for the patient who was critically ill.
As regards, individual liability of the respondent Nos 4, 5 and 6 is concerned, we may notice the same hereunder.

As regards AMRI, it may be noticed:

(i) Vital parameters of Anuradha were not examined between 11.05.1998 to 16.05.1998 (Body Temperature, Respiration Rate, pulse, BP and urine input and output)
(ii)I.V. Fuid not administered. (I.V. fluid administration is absolutely necessary in the first 48 hours of treating TEN) As regards, Dr. Balaram Prasad, Respondent No. 5, it may be noticed:
(i) Most Doctors refrain from using steroids at the later stage of the disease – due to the fear of Sepsis, yet he added more steroids in the form of quick – acting “Prednisolone” at 40g three times a day.
(ii)He stood as second fiddle to the treatment and failed to apply his own mind.
(iii)No doctor has the right to use the drug beyond the maximum recommended dose.
So far as the judgment of the Commission is concerned, it was clearly wrong in opining that there was no negligence on the part of the hospital or the doctors. We are, however, of the opinion, keeping in view the fact that Dr. Kaushik Nandy has done whatever was possible to be done and his line of treatment meets with the treatment protocol of one of the experts, viz. Prof. Jean Claude Roujeau although there may be otherwise difference of opinion, that he cannot be held to be guilty of negligence. D.5. CONCLUSION We remit the case back to the Commission only for the purpose of determination of quantum of compensation.

The principles of determining compensation are well-known. We may place on record a few of them.

In Oriental Insurance Company Limited v. Jashuben and Others [(2008) 4 SCC 162], this Court held:

“28. We, therefore, are of the opinion that what would have been the income of the deceased on the date of retirement was not a relevant factor in the light of peculiar facts of this case and, thus, the approach of the Tribunal and the High Court must be held to be incorrect. It is impermissible in law to take into consideration the effect of revision in scale of pay w.e.f. 1.1.1997 or what would have been the scale of pay in 2002.
29. The loss of dependency, in our opinion, should be calculated on the basis as if the basic pay of the deceased been Rs. 3295/- X 2 = Rs. 6,590/-, thereto should be added 18.5% dearness allowance which comes to Rs. 1219/-, child education allowance for two children @ Rs. 240/- X 2 = Rs. 480 and child bus fair Rs. 160 X 2 = Rs. 320/- should have been added which comes to Rs. 8,609/-.
30. From the aforementioned figure 1/3rd should be deducted. After deduction, the amount of income comes to Rs. 5,738/- per month [Rs. 8609/-
– Rs. 2871/-] and the amount of compensation should be determined by adopting the multiplier of 13, which comes to Rs. 8,95,128/-
31. In the present case, the High Court itself has applied the multiplier of 13. We are of the opinion that no interference therewith is warranted. We furthermore do not intend to interfere with the rate of interest in the facts and circumstance of the case.”

Indisputably, grant of compensation involving an accident is within the realm of law of torts. It is based on the principle of restitution in integrum. The said principle provides that a person entitled to damages should, as nearly as possible, get that sum of money which would put him in the same position as he would have been if he had not sustained the wrong. [See Livingstone v. Rawyards Coal Co. [ (1880) 5 AC 25 ].
When a death occurs the loss accruing to the dependent must be taken into account; the balance of loss and gain to him must be ascertained ; the position of each dependent in each case may have to be considered separately [ See Davis v. Powell Duffrya Associated Collieries Ltd. [ (1942) AC 601 ]. The said principle has been applied by this Court in Gobald Motor Service Ltd., Allahabad v. R.M.K. Veluswami, [AIR 1962 SC 1 ].

Loss of wife to a husband may always be truly compensated by way of mandatory compensation. How one would do it has been baffling the court for a long time. For compensating a husband for loss of his wife, therefore, courts consider the loss of income to the family. It may not be difficult to do when she had been earning. Even otherwise a wife’s contribution to the family in terms of money can always be worked out. Every housewife makes contribution to his family. It is capable of being measured on monetary terms although emotional aspect of it cannot be. It depends upon her educational qualification, her own upbringing, status, husband’s income, etc. This Court, we may notice, has laid down certain norms for grant of compensation for the death of members of family including the loss of child in some of its decisions. [See Lata Wadhwa v. State of Bihar (2001) 8 SCC 197 and R.K. Malik and Anr. v. Kiran Pal & Ors. 2009 (8) SCALE 451] In R.D. Hattangadi v. Pest Control (India) (P) Ltd. [AIR 1995 SC 755], this Court observed:

“Broadly speaking while fixing an amount of compensation payable to a victim of an accident, the damages have to be assessed separately as pecuniary damages and special damages. Pecuniary damages are those which the victim has actually incurred and which are capable of being calculated in terms of money; whereas non- pecuniary damages are those which are incapable of being assessed by arithmetical calculations. In order to appreciate two concepts pecuniary damages may include expenses incurred by the claimant: (i) medical attendance; (ii) loss of earning of profit up to the date of trial; (iii) other material loss. So far non-pecuniary damages are concerned, they may include (i) damages for mental and physical shock, pain and suffering, already suffered or likely to be suffered in future;
(ii) damages to compensate for the loss of amenities of life which may include a variety of matters i.e. on account of injury the claimant may not be able to walk, run or sit; (iii) damages for the loss of expectation of life, i.e., on account of injury the normal longevity of the person concerned is shortened; (iv) inconvenience, hardship, discomfort, disappointment, frustration and mental stress in life.”

The Commission must, therefore, while arriving at the adequate compensation bear in mind all these relevant facts and circumstances.
E. ASSESSING CRIMINAL CULPABILITY UNDER SECTION 304-A E.1. CRIMINAL NEGLIGENCE UNDER SECTION 304-A Criminal Medical Negligence is governed by Section 304A of the Indian Penal Code. Section 304-A of the Indian Penal Code reads as under:-
“304-A. Causing death by negligence.- Whoever causes the death of any person by doing any rash or negligent act not amounting to culpable homicide, shall be punished with imprisonment of either description for a term which may extend to two years, or with fine, or with both.”
Essential ingredients of Section 304-A are as under:-
(i) Death of a person

(ii) Death was caused by accused during any rash or negligence act.

(iii) Act does not amount to culpable homicide.

And to prove negligence under Criminal Law, the prosecution must prove:

(i) The existence of duty.
(ii)A breach of the duty causing death.
(iii) The breach of the duty must be characterized as gross negligence.

[See R. v. Prentice and R v. Adomako: [1993] 4 All ER 935] The question in the instant case would be whether the Respondents are guilty of criminal negligence. Criminal negligence is the failure to exercise duty with reasonable and proper care and employing precautions guarding against injury to the public generally or to any individual in particular.
It is, however, well settled that so far as the negligence alleged to have been caused by medical practitioner is concerned, to constitute negligence, simple lack of care or an error of judgment is not sufficient. Negligence must be of a gross or a very high degree to amount to Criminal Negligence.
Medical science is a complex science. Before an inference of medical negligence is drawn, the court must hold not only existence of negligence but also omission or commission on his part upon going into the depth of the working of the professional as also the nature of the job. The cause of death should be direct or proximate. A distinction must be borne in mind between civil action and the criminal action.

The jurisprudential concept of negligence differs in civil and criminal law. What may be negligence in civil law may not necessarily be negligence in criminal law. For negligence to amount to an offence the element of mens rea must be shown to exist. For an act to amount to criminal negligence, the degree of negligence should be much high degree. A negligence which is not of such a high degree may provide a ground for action in civil law but cannot form the basis for prosecution. To prosecute a medical professional for negligence under criminal law it must be shown that the accused did something or failed to do something which in the given facts and circumstances no medical professional in his ordinary senses and prudence would have done or failed to do.

SHIFTING OF BLAME It is also of some great significance that both in the criminal as also the civil cases, the concerned doctors took recourse to the blame game. Some of them tried to shirk their individual responsibilities. We may in this behalf notice the following:
(i) In response to the notice of Dr. Kunal, Dr. Mukherjee says that Depomedrol had not been administered at all. When confronted with his prescription, he suggested that the reply was not prepared on his instructions, but on the instruction of AMRI.
(ii) Dr. Mukherjee, thus, sought to disown his prescription at the first instance. So far as his prescription dated 11th May, 1998 is concerned, according to him, because he left Calcutta for attending an international conference, the prescription issued by him became non-operative and, thus, he sought to shift the blame on Dr. Halder.
(iii) Dr. Mukherjee and Dr. Halder have shifted the blame to Dr. Prasad and other doctors. Whereas Dr. Prasad counter-charged the senior doctors including the respondent No. 2 stating:
“Prof. B.N. Halder (Respondent No. 2) was so much attached with the day to day treatment of patient Anuradha that he never found any deficiency in overall management at AMRI so much so that he had himself given a certificate that her condition was very much fit enough to travel to Mumbai…”

In answer to a question as to whether Dr. Halder had given specific direction to him for control of day to day medicine to Anuradha, he stated:
“…this was done under the guidance of Dr. Sukumar Mukherjee (Respondent No. 1), Dr. B.N. Halder (Respondent No. 2) and Dr. Abani Roychowdhury (Respondent No. 3)”

He furthermore stated that those three senior doctors primarily decided the treatment regimen for Anuradha at AMRI.

(iv) Dr. Kaushik Nandy had also stated that three senior doctors were incharge of Anuradha’s treatment.
(v) AMRI states that the drugs had been administered and nursing care had been given as per the directions of the doctors.
(vi) Respondent Nos. 5 and 6, therefore, did not own any individual responsibility on themselves although they were independent Physicians with Post Graduate medical qualifications. In `Errors, Medicine and the Law’, Cambridge University Press, p.14., the authors, Alan Merry and Alexander McCall Smith, 2001 ed., stated:
“Many incidents involve a contribution from more than one person, and this case is an example. It illustrates the tendency to blame the last identifiable element in the claim of causation – the person holding the `smoking gun’. A more comprehensive approach would identify the relative contributions of the other failures in the system, including failures in the conduct of other individuals…”

In R v. Yogasa Karan [1990] 1 NZLR 399, the New Zealand Court opined that the hospital is in a better position to disclose what care was taken or what medicine was administered to the patient. It is the duty of the hospital to satisfy that there was no lack of care or diligence. The hospitals are institutions, people expect better and efficient service, if the hospital fails to discharge their duties through their doctors, being employed on job basis or employed on contract basis, it is the hospital which has to justify and not impleading a particular doctor will not absolve the hospital of its responsibilities. [See also Errors, Medicine and the Law, Alan Merry and Alexander McCall Smith, 2001 ed., Cambridge University Press, p.12] It is generally expected that very senior doctors would behave responsibly, and they were entitled to take any defence which is available to them but they should not resort to mudslinging. This being a case where both sides being doctors, fair dealings were expected from them. CUMULATIVE EFFECT OF NEGLIGENCE A patient would feel the deficiency in service having regard to the cumulative effect of negligence of all concerned. Negligence on the part of each of the treating doctors as also the hospital may have been contributing factors to the ultimate death of the patient. But, then in a case of this nature, the court must deal with the consequences the patient faced keeping in view the cumulative effect.

In the instant case, negligent action has been noticed with respect to more than one respondent. A cumulative incidence, therefore, has led to the death of the patient. It is to be noted that doctrine of cumulative effect is not available in criminal law. The complexities involved in the instant case as also differing nature of negligence exercised by various actors, make it very difficult to distil individual extent of negligence with respect to each of the respondent. In such a scenario finding of medical negligence under section 304-A cannot be objectively determined.

E.2. CONCLUSION .

In view of our discussions made hereinbefore, we are of the opinion that for the death of Anuradha although Dr. Mukherjee, Dr. Halder, Dr. Abani Roy Chowdhury, AMRI, Dr. B. Prasad were negligent, the extent thereof and keeping in view our observations made hereinbefore, it cannot be said that they should be held guilty for commission of an offence under Section 304-A of the Indian Penal Code. We furthermore in a case of this nature do not intend to exercise our discretionary jurisdiction under Article 136 of the Constitution of India having regard to the fact that a judgment of acquittal has been recorded by the Calcutta High Court.

F. OBSERVATIONS OF THE CALCUTTA HIGH COURT

We must express our agony in placing on record that the Calcutta High Court in its judgment has made certain observations which apart from being not borne out from the records, are also otherwise highly undesirable.
Some of the conclusions arrived at by the High Court are not based on the findings emerging from the records.

These conclusions are as produced as under:

“28…On 24.5.1998, it was noted “wounds were healing well, epidermal islands have appeared over palms, soles and trunk ………….. no obvious Pseudomonas Colony like before”. All these noting in the record of Breach Candy Hospital indicate that her skin had started healing and undoubtedly, such healing was outcome of effective treatment. This betterment of skin lesion in the instant case could have been due to timely and effective treatment, undoubtedly with steroids. This may indicate the benefit of treatment at Calcutta…
It was furthermore stated:
“32. In this connection it is also to be mentioned that the death certificate alone cannot rule out the possibility of accidental suicidal or homicidal cause of the death. A post-mortem examination alone could rule out the possibility of these three kinds of death….On the other hand, the improvement of Anuradha as noticed before 25.5.1998 indirectly supports the argument that the treatment at Calcutta was at best not wrongly directed.”
….
“119…But in the present case, it indicates that there was no fixed treatment, and no faith was reposed on any of the accused doctors and over- jealousness of the patient party practically brought the untimely death of a young lady.
The High Court observed that Anuradha died because of interference of Kunal. Such an observation was made on the basis of some representations although his name did not appear in the records of AMRI. It was stated:
“124. At the close, it is to be pointed out that Dr. Kunal Saha did not repose faith on any institution as can be ascertained from his conduct discussed hereinabove in details. He also failed to take the investigating agency of this country into confidence and in paragraph 25 of the complaint, it was noted –“that the accused persons are highly influential and are likely to interfere with investigation and as such, complainant would be left with no other alternative than to institute the complaint before the highest magistracy of the Sessions Division of 24-Paraganas (South)”. It is rightly contended by the learned counsel appearing on behalf of the accused doctors that such an action may lead to two conclusions :–
(i) The complainant has no confidence on the police investigation of this country, or,
(ii) The police investigation could unveil some untold facts or circumstances leading to the untimely death of Anuradha.
Be that as it may, by filing a complaint for the purpose of proving the rash and negligent act against the three specialized doctors, the complainant party intentionally took upon themselves a heavy burden of proving the case which they actually failed to discharge. So it was claimed to be an uneven battle, which was declared by the complainant party without being aware of the law on the subject and the consequences. It is needless to mention that now-a- days there is an attempt amongst the patient party to lodge complaint against the attending doctors for the purpose of their punishment. On several occasions patient party also ransacked the hospitals or chambers of the doctors and mishandled them on the plea of negligence to duty. In this way the doctors have been suffering from fear psychosis.”

We must also express our great dissatisfaction when the Calcutta High Court stated:

“121. But it is sufficiently clear that a man of the medical field now residing at United States with family after acquiring citizenship of that country has challenged the conduct and integrity of the three Professors. In this connection, I deem it proper to quote a remark of Lord Denning MR in White House v. Jordan (supra);
“……………. Take heed of what has happened in the United States. ‘Medical malpractice’ cases there are very worrying, especially as they are tried by juries who have sympathy for the patient and none for the doctor who is insured. The damages are colossal. The doctors insure but the premiums become very high ; and these have to be passed on in fees to the patients. Experienced practitioners are none to have refused to treat patients for fear of being accused of negligence. Young men are even deterred from entering the profession because of the risks involved. In the interests of all, we must avoid such consequences in England. Not only must we avoid excessive damages. We must say and say firmly, that in a professional man, an error of judgment is not negligent …………..”.
Further the statement made by the High Court that the transfer certificate was forged by the patient party is absolutely erroneous, as Dr. Anil Kumar Gupta deposed before the trial court that he saw the transfer certificate at AMRI’s office and the words “for better treatment” were written by Dr.Balaram Prasad in his presence and these words were written by Dr.Prasad, who told it would be easier for them to transport the patient.

In a case of this nature, Kunal would have expected sympathy and not a spate of irresponsible accusation from the High Court.

G. SUMMARY For the reasons aforementioned, the criminal appeals are dismissed. As regards the civil appeal, the matter is remitted to the National Commission for determining the compensation with a request to dispose of the matter as expeditiously as possible and preferably within a period of six months from the date of receipt of a copy of this judgment. Civil Appeal is disposed of accordingly.

We, keeping in view the stand taken and conduct of AMRI and Dr. Mukherjee, direct that costs of Rs. 5,00,000/- and Rs. 1,00,000/- would payable by AMRI and Dr. Mukherjee respectively.
We further direct that if any foreign experts are to be examined it shall be done only through video conferencing and at the cost of respondents.

[S.B. Sinha]
[Deepak Verma]

New Delhi;
August 07, 2009

Pappu and Ors. Vs. Vinod Kumar Lamba and ANR [SC 2018 January]

KEYWORDS :- Insurance-Fault Liability-Motor Accident Claim-Authorised person-

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DATE : January 19, 2018

ACTS:- Motor Vehicles Act, 1988-Sections 165 and 168

SUPREME COURT OF INDIA

Pappu and Ors. Vs. Vinod Kumar Lamba and ANR.

[Civil Appeal No. 20962 of 2017 arising out of SLP(C) No.29032 of 2015]

A.M. Khanwilkar, J.

1. This appeal questions the legality and tenability of the judgment of the High Court of Judicature at Allahabad in First Appeal from Order No.1138 of 2000, dated 9th October, 2014, whereby the appeal filed by the appellants was dismissed by the High Court whilst rejecting the only question raised before it regarding absolving the Insurance Company (Respondent No.2) from any liability in respect of truck bearing No.DIL-5955, which was duly insured by respondent No.2 Insurance Company, on the ground that the same was not driven by a person having a valid licence, as found by the Motor Accident Claims Tribunal, District Allahabad in Claim Petition No.215 of 1999.

2. In the claim petition it was asserted that on 12.08.1995 Om Prakash, son of Satku Lal, was driving Truck No.URS-2735 when it was knocked down by a rashly and negligently driven Truck No.DIL-5955 coming from the opposite direction, as a result of which Om Prakash succumbed to fatal injuries.

The claim petition was filed by the widow of deceased Om Prakash. Om Prakash left behind his children Pappu, aged 16 years, Ramu, 12 years, Kumari Geeta, 14 years, Kumari Neetu, 10 years, Kumari Guriya, 8 years and his mother, Smt. Shiv Rani, at the time of the accident. The widow of deceased Om Prakash claimed compensation of Rs.7 lakh under Fault Liability and Rs.25,000/- under No Fault Liability. The mother of Om Prakash claimed compensation of Rs.50,000/- separately. On the date of the accident, Om Prakash was around 35 years of age and was a driver by profession.

3. In the context of the sole contention raised before the High Court and reiterated before this Court, it is not necessary for us to dilate on factual aspects considered by the Tribunal except to state that the Tribunal, on analysis of the evidence on record, held that Om Prakash died because of the accident caused by rash and negligent driving of Truck No.DIL-5955. Although the Tribunal allowed the claim petition in part, it absolved respondent No.2 Insurance Company by dismissing the claim petition against the said respondent.

The Tribunal awarded a sum of Rs.25,000/- to opposite party No.3 Shiv Rani and Rs.1,75,000/- to claimant Nos.1 to 6, with interest at the rate of 12% per annum from the date of petition till the date of payment. In other words, the claim petition was partly allowed against respondent No.1 – the owner of the offending vehicle DIL-5955.

4. In the appeal preferred by the appellants/claimants against the said decision, the only question urged before the High Court was about the correctness of the view taken by the Tribunal in absolving the respondent No.2 Insurance Company even though the offending Truck No.DIL-5955 was duly insured by the said Insurance Company.

The High Court affirmed the view taken by the Tribunal that there was no pleading or any evidence adduced by the owner of the offending Truck to substantiate the fact that the Truck was driven by one Joginder Singh, whose driving licence was produced on record. The High Court also noted that there could be no presumption that Joginder Singh was driving the offending vehicle. The appellants have assailed the aforesaid view taken by the Tribunal and affirmed by the High Court.

5. According to the appellants, the Insurance Company did not produce any evidence before the Tribunal. As a result, it was not open to the respondent No.2 Insurance Company to extricate itself from the liability, having duly insured the offending vehicle DIL-5955, which fact has been substantiated by production of the Insurance Policy.

A defence being available to the Insurance Company, that the offending vehicle was not driven by an authorised person and/or person not having a valid driving licence, it was obligatory on the part of the Insurance Company to substantiate that defence and more so, to rebut the plea taken by the owner of the offending vehicle that the offending vehicle was being driven by an authorised person having a valid driving licence. To buttress this argument, reliance has been placed on the decision of this Court in the case of National Insurance Co. Ltd. Vs. Swarn Singh and Ors.

6. We have heard Mr. Sharve Singh, learned counsel appearing for the appellants and Mr. Rishi Malhotra, learned counsel appearing for the Insurance Company.

7. In the context of the issue that arises for our consideration, we may first advert to the claim petition. In the claim petition, the name of the driver of the offending vehicle DIL-5955 has not been mentioned. The assertion made in the claim petition is that Truck No.URS-2735 driven by Om Prakash was knocked down by the offending Truck No.DIL-5955 coming from the opposite direction by rash and negligent driving.

The reply filed by respondent No.1 – owner of the offending Truck DIL-5955 also does not mention the name of the driver of the offending Truck No.DIL-5955. Indeed, the reply filed by respondent No.1 asserts that the vehicle No.DIL-5955 was comprehensively insured by the respondent No.2 Insurance Company for unlimited liability. The details of the Insurance Certificate have been mentioned in the Written Statement. In paragraph 18 of the Written Statement, however, a vague assertion has been made that on the alleged date of incident, the offending vehicle DIL-5955 6 was plied by an authorised person having a valid driving permit.

8. In the Written Statement filed by the respondent No.2 Insurance Company to oppose the claim petition, it is asserted that the claimants should be put to strict proof about the occurrence of the accident and other related matters. It is then asserted that no insurance is directly issued by the Head Office of respondent No.2. The name of the Branch Office by which the vehicle in question was allegedly insured has not been disclosed and in its absence, it was difficult to trace out the insurance policy.

Further, the original insurance policy will have to be summoned from the Insurer or owner of the vehicle. It is then asserted that neither has the alleged owner of the vehicle (respondent No.1) informed about any claim nor have the claimants made any claim to the Insurance Company. As regards the plea taken by respondent No.1 – owner of the offending vehicle, in paragraph 29 of the Written Statement, it has been asserted by respondent No.2 as follows:

“29. That in petition anywhere or in column 16 of the petition details or driving licence of the alleged driver are not given and in absence of details it is quite impossible for answering opposite party to ascertain the driving licence and its validity on the alleged date of accident, hence the driving licence if any and its validity on the alleged date of accident is denied. The answering opposite party could not be held liable for payment of any award if made, unless it is proved that the vehicle allegedly involved in the alleged accident was driving under valid driving licence by its authorized driver with due permission and under control of its owner and under valid road, permit, fitness, road tax etc. as required under the provisions of M.V. Act and also was driven with full compliance of the terms and conditions of the alleged insurance policy.” It is not necessary to reproduce the other averments in the Written Statement filed by respondent No.2.

9. On the basis of these pleadings, the matter proceeded before the Tribunal. Admittedly, the respondent No.1 – owner of the vehicle did not produce any evidence in support of his plea taken in the Written Statement that the offending vehicle was plied by an authorised person having a valid driving permit. All that respondent No.1 did was to produce a driving licence purportedly of one Joginder Singh. The Tribunal adverted to the said driving licence but found that nowhere the owner of the vehicle has asserted that the Truck No.DIL-5955 was in fact driven by said Joginder Singh at the time of the accident. On the basis of the pleadings, the Tribunal framed issue No.3 and answered the same in favour of the Insurance Company as follows:

“Issue No.3: Whether the Truck No. DIL-5955 was not being driven by a person having valid and effective driving licence? As it has been stated earlier, that the owner of Truck No. DIL-5955 has filed original driving licence of one Joginder Singh but he has not mentioned anywhere that Joginder Singh was driving his truck at the time of accident. The owner has filed photo copy of insurance policy in which at paragraph 5 proviso A, it is written that the insurance company will be liable when driver was holding a valid and effective driving licence. The owner of the vehicle has not proved that his driver was holding a valid and effective driving licence. This issue is decided in the negative.”

10. This view taken by the Tribunal was assailed before the High Court by the claimants. No other contention was raised before the High Court except about the liability of the Insurance Company. The High Court, after analysing the record, negatived the said contention in the following words:

“5. The only question which has been raised before this Court is, whether Insurance Company has rightly been held not liable by holding that Truck No. DIL 5955 was not being driven by a person having valid licence. This Court has to consider, whether findings recorded in respect of issue no.3 is correct or not.

6. Learned counsel for the appellants could not dispute that neither any pleadings nor evidence have been led before Tribunal to suggest or to tell, as a matter of fact, that aforesaid truck was being driven by Sri Joginder Singh. It is not in dispute that owner of aforesaid vehicle produced driving licence which was in the name of Sri Joginder Singh but at no stage it is pleaded or brought on record before Tribunal that Sri Joginder Singh was the person who was driving aforesaid Truck. This fact has been noticed by Tribunal in the impugned order as under. ‘Joginder Singh Ko Prastut Kiya Gaya Hai Parantu Joginder Singh Truck No. 5955 Ka Chalak Tha Yah Kahi Par Bhi Nahi Kaha Gaya Hai.’

7. Learned counsel for the appellants could not dispute this fact. In view of above statement of fact that it was not pleaded or proved before Tribunal, the mere production of driving licence of Sri Joginder Singh, by owner of vehicle, cannot raise a presumption that he was a person who was driving vehicle. The findings recorded by Tribunal, therefore, cannot be faulted in any manner. No other argument has been advanced.”

11. The question is: whether the fact that the offending vehicle bearing No.DIL-5955 was duly insured by respondent No.2 Insurance Company would per se make the Insurance Company liable? This Court in the case of National Insurance Co. Ltd. (supra), has noticed the defences available to the Insurance Company under Section 149(2)(a)(ii) of the Motor Vehicles Act, 1988. The Insurance Company is entitled to take a defence that the offending vehicle was driven by an unauthorised person or the person driving the vehicle did not have a valid driving licence. The onus would shift on the Insurance Company only after the owner of the offending vehicle pleads and proves the basic facts within his knowledge that the driver of the offending vehicle was authorised by him to drive the vehicle and was having a valid driving licence at the relevant time.

In the present case, the respondent No.1 owner of the offending vehicle merely raised a vague plea in the Written Statement that the offending vehicle DIL-5955 was being driven by a person having valid driving licence. He did not disclose the name of the driver and his other details. Besides, the respondent No.1 did not enter the witness box or examine any witness in support of this plea. The respondent No.2 Insurance Company in the Written Statement has plainly refuted that plea and also asserted that the offending vehicle was not driven by an authorised person and having valid driving licence. The respondent No.1 owner of the offending vehicle did not produce any evidence except a driving licence of one Joginder Singh, without any specific stand taken in the pleadings or in the evidence that the same Joginder Singh was, in fact, authorised to drive the vehicle in question at the relevant time.

Only then would onus shift, requiring the respondent No.2 Insurance Company to rebut such evidence and to produce other evidence to substantiate its defence. Merely producing a valid insurance certificate in respect of the offending Truck was not enough for the respondent No.1 to make the Insurance Company liable to discharge his liability arising from rash and negligent driving by the driver of his vehicle. The Insurance Company can be fastened with the liability on the basis of a valid insurance policy only after the basic facts are pleaded and established by the owner of the offending vehicle – that the vehicle was not only duly insured but also that it was driven by an authorised person having a valid driving licence.

Without disclosing the name of the driver in the Written Statement or producing any evidence to substantiate the fact that the copy of the driving licence produced in support was of a person who, in fact, was authorised to drive the offending vehicle at the relevant time, the owner of the vehicle cannot be said to have extricated himself from his liability. The Insurance Company would become liable only after such foundational facts are pleaded and proved by the owner of the offending vehicle.

12. In the present case, the Tribunal has accepted the claim of the appellants. It has, however, absolved the respondent No.2 Insurance Company from any liability for just reasons. The High Court has also affirmed that view. It rightly held that there can be no presumption that Joginder Singh was driving the offending vehicle at the relevant time.

13. Be that as it may, no grievance about the quantum of compensation awarded by the Tribunal has been made by the appellants – claimants (either before the High Court or before us in this appeal). Hence, that issue does not warrant any scrutiny. Similarly, the owner of the vehicle (respondent No.1) has not challenged the findings of the Tribunal as affirmed by the High Court in favour of the insurer (respondent No.2), including on the factum that the vehicle was driven by a person who did not have a valid driving licence at the relevant time.

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 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 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.

(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 16 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, 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)

15. In the present case, the owner of the vehicle (respondent No.1) had produced the insurance certificate indicating that vehicle No. DIL- 5955 was comprehensively insured by the respondent No.2 (Insurance Company) for unlimited liability. Applying the dictum in the case of National Insurance Company Ltd. (supra), to subserve the ends of justice, the insurer (respondent No.2) shall pay the claim amount awarded by the Tribunal to the appellants in the first instance, with liberty to recover the same from the owner of the vehicle (respondent No.1) in accordance with law.

16. Accordingly, the appeal is allowed to the extent that the compensation amount awarded by the Tribunal and confirmed by the High Court shall be paid and satisfied by the insurer (respondent No.2) in the first instance, with liberty to recover the same from the owner of the vehicle (respondent No.1) in accordance with law.

17. Appeal is disposed of in the aforementioned terms with no order as to costs.

CJI. (Dipak Misra)

J. (A.M. Khanwilkar)

J. (Dr. D.Y. Chandrachud)

New Delhi;

January 19, 2018.

National Insurance Co. Ltd. Vs Swaran Singh and others [SC 2004 January]

KEYWORDS:- MOTOR VEHICLE CLAIM-

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DATE:-05-01-2004-

  • If a vehicle at the time of accident was driven by a person having a learner’s licence, the insurance companies would be liable to satisfy the decree.

AIR 2004 SC 1531 : (2004) 1 SCR 180 : (2004) 3 SCC 297 : JT 2004 (1) SC 109 : (2004) 1 SCALE 180

(SUPREME COURT OF INDIA)

National Insurance Co. Ltd. Appellant
Versus
Swaran Singh and others Respondent

(Before : V. N. Khare, C.J.I., D. M. Dharmadhikari And S. B. Sinha, JJ.)

Spl. Leave Petn. (C) No. 9027 of 2003 with SLP (C) Nos. 10017, 10042, 10055, 10510, 10787, 10829-10831, 11129 of 2003, 153 of 2004, 4917 of 2003, 154, 156, 155, 157, 159, 356 of 2004, 9335, 9356, 9554, 9560, 9811, 9812, 9815, 9867, 9900, 9947 of 2003, 321, 160, 357 of 2004, 15528 and 15772 of 2002,

Decided on : 05-01-2004.

Motor Vehicles Act, 1988—Sections 7(2), 4(3) and 10—Accident caused by person having learner’s licence—Liability of insurer—Insurance company liable.

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.

Motor Vehicles Act, 1988 provides for grant of learner’s licence. (See Section 4(3), Section 7(2), Section 10 and Section 14). A learner’s licence is, thus, also a licence within the meaning of the provisions of the said Act. It cannot, therefore, be said that a vehicle when being driven by a learner subject to the conditions mentioned in the licence, he would not be a person who is not duly licensed resulting in conferring a right on the insurer to avoid the claim of the third party. It cannot be said that a person holding a learner’s licence is not entitled to drive the vehicle. Even if there exists a condition in the contract of insurance that the vehicle cannot be driven by a person holding a learner’s licence, the same would run counter to the provisions of Section 149(2) of the said Act.

The provisions contained in the said Act provide also for grant of driving licence which is otherwise a learner’s licence. Sections 3(2) and 6 of the Act provides for the restriction in the matter of grant of driving licence. Section 7 deals with such restrictions on granting of learner’s licence. Section 8 and 9 provide for the manner and conditions for grant of driving licence. Section 15 provides for renewal of driving licence. Learner’s licences are granted under the rules framed by the Central Government or the State Governments in exercise of their rule-making power. Conditions are attached to the learner’s licences granted in terms of the statute. A person holding learner’s licence would, thus, also come within the purview of “duly licensed” as such a licence is also granted in terms of the provisions of the Act and the rules framed thereunder.

Motor Vehicles Act, 1988—Section 149—Liability of insurer—Available defences—Burden of proof—No criteria laid down how the burden to be discharged.

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 circumstances of each case.

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.

Motor Vehicles Act, 1988—Section 149(2)—Accident caused by person having learner’s licence—Liability of insurer—Insurance company liable.

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.

If a vehicle at the time of accident was driven by a person having a learner’s licence, the insurance companies would be liable to satisfy the decree.

Motor Vehicles Act, 1988 provides for grant of learner’s licence. (See Section 4(3), Section 7(2), Section 10(3) and Section 14). A learner’s licence is, thus, also a licence within the meaning of the provisions of the said Act. It cannot, therefore, be said that a vehicle when being driven by a learner subject to the conditions mentioned in the licence, he would not be a person who is not duly licensed resulting in conferring a right on the insurer to avoid the claim of the third party. It cannot be said that a person holding a learner’s licence is not entitled to drive the vehicle. Even if there exists a condition in the contract of insurance that the vehicle cannot be driven by a person holding a learner’s licence, the same would run counter to the provisions of Section 149(2) of the said Act.

The provisions contained in the said Act provide also for grant of driving licence which is otherwise a learner’s licence. Sections 3(2) and 6 of the Act provides for the restriction in the matter of grant of driving licence. Section 7 deals with such restrictions on granting of learner’s licence. Section 8 and 9 provide for the manner and conditions for grant of driving licence. Section 15 provides for renewal of driving licence. Learner’s licences are granted under the rules framed by the Central Government or the State Governments in exercise of their rule-making power. Conditions are attached to the learner’s licences granted in terms of the statute. A person holding learner’s licence would, thus, also come within the purview of “duly licensed” as such a licence is also granted in terms of the provisions of the Act and the rules framed thereunder.

Motor Vehicles Act, 1988—Section 149(2)—Insurance policy conditions—Construing of—In interpreting policy conditions, tribunal to apply ‘rule of main purpose’ and ‘concept of fundamental breach’ to allow defences available under Section 149(2).

Motor Vehicles Act, 1988—Section 149(2)—Liability of insurer—Insurance company to satisfy the decree first and recover the awarded amount later—No deviation from the said principle.

Liability of the insurance company to satisfy the decree at the first instance and to recover the awarded amount from the owner or driver thereof has been holding the field for a long time.

Apart from the reasons stated hereinbefore the doctrine of stare decisis persuades us not to deviate from the said principle.

It is well-settled rule of law and should not ordinarily be deviated from.

Motor Vehicles Act, 1988—Section 149(2)(a)(ii)—Third party risks—Defences available to insurer—Mere absence, fake/invalid driving licence or disqualification of driver for driving at relevant time, not by themselves defences for insurer.

The breach of policy condition e.g. disqualification of driver or invalid driving licence 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.

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 wherefore would be on them.

Motor Vehicles Act, 1988—Section 165—Accident claim—Adjudication by tribunal—Powers of—Tribunal has power and jurisdiction to decide disputes inter se between insurer and insured.

The claims tribunal constituted under Section 165 read with Section 168 is empowered to adjudicate all claims in respect of the accidents involving death or of bodily injury or damage to property of third party arising in use of motor vehicle. The said power of the tribunal is not restricted to decide the claims inter se between claimant or claimants on one side and insured, insurer and driver on the other. In the course of adjudicating the claim for compensation and to decide the availability of defence or defences to the insurer, the Tribunal has necessarily the power and jurisdiction to decide disputes inter se between insurer and the insured. The decision rendered on the claims and disputes inter se between the insurer and insured in the course of adjudication of claim for compensation by the claimants and the award made thereon is enforceable and executable in the same manner as provided in Section 174 of the Act for enforcement and execution of the award in favour of the claimants.

Where an 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 Sections 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 as 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.

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 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.

Counsel for the Parties:

Harish N. Salve, M. L. Verma, P. P. Malhotra, Sr. Advocates, Pramod Dayal, Piysh Sharma, Vishnu Mehra, B. K. Satija, Joy Basu, Atul Nanda, Ms. Veena Nanda, P. N. Puri, Shailendra Sharma, Ms. Binu Tamta, Ms. Pankaj Bala Verma, Ms. Kirti Renu Mishra, S. L. Gupta, S. P. Jain, K. P. Singh, S. M. Suri, Ms. Meenu Pandey, Pramod Dayal, Sudhir Kumar Gupta, P. K. Seth, Anurag Pandey, Ms. Kiran Suri, Kishore Rawat, M. K. Dua, Manish Goswami, Rameshwar Prasad Goyal, B. S. Chahar, Ms. Jyoti Chahar, Vinay Garg, Parveen K. Vohra, Dinesh Verma, Ms. Suresh Kumari and A. P. Mohanty, Advocates with them, for Appearing Parties.

Judgment

V. N. Khare, C.J.I. And D. M. Dharmadhikari, S. B. Sinha, Jj—Interpretation of S. 149(2)(a)(ii) vis-a-vis the proviso appended to sub-sections (4) and (5) of the Motor Vehicles Act, 1988 is involved in this batch of special leave petitions filed by the National Insurance Company Limited (hereinafter referred to as Insurer) assailing various awards of the Motor Vehicles Claims Tribunal and judgments of the High Courts.

2. In view of the fact that these petitions involve pure questions of law, it is not necessary to advert to the individual fact pertaining to each matter.

Suffice, however, is to point out that the vehicles insured with the petitioners, were involved in accidents resulting in filing of claim applications by the respective legal representatives of the deceased(s) or the injured person(s) as the case may be.

3. Defences raised by the petitioner-company in the claim petitions purported to be in terms of S. 149(2)(a)(ii) of the Motor Vehicles Act, 1988 (hereinafter referred to as ‘the Act’) were (a) driving licence produced by the driver or owner of the vehicle was a fake one; (b) driver did not have any licence whatsoever, (c) licence, although was granted to the concerned driver but on expiry thereof, the same had not been renewed; (d) licence granted to the drivers being for one class or description of vehicle but the vehicle involved in the accident was of different class or description; and (e) the vehicle in question was driven by a person having a learner’s licence.

4. Before we proceed further in the matter it is relevant to notice certain relevant statutory provisions which are :

“2(10) “driving licence” means the licence issued by a competent authority under Chapter II authorising the person specified therein to drive, otherwise than as a learner, a motor vehicle or a motor vehicle of any specified class or description;

3. Necessity for driving licence.- (1) No person shall drive a motor vehicle in any public place unless he holds an effective driving licence issued to him authorising him to drive the vehicle; and no person shall so drive a transport vehicle other than (a motor cab or motor cycle hired for his own use or rented under any scheme made under sub-section (2) of S. 75 unless his driving licence specifically entitles him so to do.

(2) The conditions subject to which sub-section (1) shall not apply to a person receiving instructions in driving a motor vehicle shall be such as may be prescribed by the Central Government.

4. Age limit in connection with driving of motor vehicles.- (1) No person under the age of eighteen years shall drive a motor vehicle in any public place :

Provided that a motor cycle with engine capacity not exceeding 50cc may be driven in a public place by a person after attaining the age of sixteen years.

(2) Subject to the provisions of S. 18, no person under the age of twenty years shall drive a transport vehicle in any public place.

(3) No learner’s licence or driving licence shall be issued to any person to drive a vehicle of the class to which he has made an application unless he is eligible to drive that class of vehicle under this section.

5. Responsibility of owners of motor vehicles for contravention of Ss. 3 and 4.- No owner or person in-charge of a motor vehicle shall cause or permit any person who does not satisfy the provisions of S. 3 or S. 4 to drive the vehicle.

6. Restrictions on the holding of driving licences.- (1) No person shall, while he holds any driving licence for the time being in force, hold any other driving licence except a learner’s licence or a driving licence issued in accordance with the provisions of S. 18 or a document authorising, in accordance with the rules made under S. 139, the person specified therein to drive a motor vehicle.

(2) No holder of a driving licence or a learner’s licence shall permit it to be used by any other person.

(3) Nothing in this section shall prevent a licensing authority having the jurisdiction referred to in sub-section (1) of S. 9 from adding to the classes of vehicles which the driving licence authorises the holder to drive.

7. Restrictions on the granting of learner’s licences for certain vehicles. (1) No person shall be granted a learner’s licence to drive a transport vehicle unless he has held a driving licence to drive a light motor vehicle for at least one year.

(2) No person under the age of eighteen years shall be granted a learner’s licence to drive a motor cycle without gear except with the consent in writing of the person having the care of the person desiring the learner’s licence.”

Section 9 provides for grant of driving licence.

“9. Grant of driving licence.- (1) Any person who is not for the time being disqualified for holding or obtaining a driving licence may apply to the licensing authority having jurisdiction in the area-

(i) in which he ordinarily resides or carries on business, or

(ii) in which the school or establishment referred to in S. 12 from where he is receiving or has received instruction in driving a motor vehicle is situated.

for the issue to him of a driving licence.

**********

(7) When any application has been duly made to the appropriate licensing authority and the applicant has satisfied such authority of his competence to drive, the licensing authority shall issue the applicant a driving licence unless the applicant is for the time being disqualified for holding or obtaining a driving licence :

Provided that a licensing authority may issue a driving licence to drive a motor cycle or a light motor vehicle notwithstanding that it is not the appropriate licensing authority, if the licensing authority is satisfied that there is good and sufficient reason for the applicant’s inability to apply to the appropriate licensing authority :

Provided further that the licensing authority shall not issue a new driving licence to the applicant, if he had previously held a driving licence, unless it is satisfied that there is good and sufficient reason for his inability to obtain a duplicate copy of his former licence.

(8) If the licensing authority is satisfied, after giving the applicant an opportunity of being heard, that he-

(a) is a habitual criminal or a habitual drunkard; or

(b) is a habitual addict to any narcotic drug or psychotropic substance within the meaning of the Narcotic Drugs and Psychotropic Substances Act, 1985 (61 of 1985); or

(c) is a person whose licence to drive any motor vehicle has, at any time earlier, been revoked,

it may, for reasons to be recorded in writing, make an order refusing to issue a driving licence to such person and any person aggrieved by an order made by a licensing authority under this sub-section may, within thirty days of the receipt of the order, appeal to the prescribed authority.

(9) Any driving licence for driving a motor cycle in force immediately before the commencement of this Act shall, after such commencement, be deemed to be effective for driving a motor cycle with or without gear.

10. Form and contents of licences to drive.- (1) Every learner’s licence and driving licence, except a driving licence issued under S. 18, shall be in such form and shall contain such information as may be prescribed by the Central Government.

(2) A learner’s licence or, as the case may be, driving licence shall also be expressed as entitling the holder to drive a motor vehicle of one or more of the following classes, namely :-

(a) motor cycle without gear;

(b) motor cycle with gear;

(c) invalid carriage;

(d) light motor vehicle;

(e) transport vehicle;

(i) road-roller;

(j) motor vehicle of a specified description.

14. Currency of licences to drive motor vehicles.- (1) A learner’s licence issued under this Act shall, subject to the other provisions of this Act, be effective for a period of six months from the date of issue of the licence.

(2) A driving licence issued or renewed under this Act shall.-

(a) in the case of a licence to drive a transport vehicle, be effective for a period of three years :

Provided that in the case of licence to drive a transport vehicle carrying goods of dangerous or hazardous nature be effective for a period of one year and renewal thereof shall be subject to the condition that the driver undergoes one day refresher course of the prescribed syllabus; and

(b) in the case of any other licence,-

(i) if the person obtaining the licence, either originally or on renewal thereof, has not attained the age of fifty years on the date of issue or, as the case may be, renewal thereof,-

(A) be effective for a period of twenty years from the date of such issue or renewal; or

(B) until the date on which such person attains the age of fifty years, whichever is earlier;

(ii) if the person referred to in sub-clause (i), has attained the age of fifty years on the date of issue or as the case may be, renewal, thereof, be effective, on payment of such fee as may be prescribed, for a period of five years from the date of such issue or renewal:

Provided that every driving licence shall, notwithstanding its expiry under this sub-section continue to be effective for a period of thirty days from such expiry;

15. Renewal of driving licences.- (1) Any licensing authority may, on application made to it, renew a driving licence issued under the provisions of this Act with effect from the date of its expiry :

Provided that in any case where the application for the renewal of a licence is made more than thirty days after the date of its expiry, the driving licence shall be renewed with effect from the date of its renewal :

Provided further that where the application is for the renewal of a licence to drive a transport vehicle or where in any other case the applicant has attained the age of forty years, the same shall be accompanied by a medical certificate in the same form and in the same manner as is referred to in sub-section (3) of S. 8, and the provisions of sub-section (4) of S. 8 shall, so far as may be, apply in relation to every such case as they apply in relation to a learner’s licence.

(2) An application for the renewal of a driving licence shall be made in such form and accompanied by such documents as may be prescribed by the Central Government.

(3) Where an application for the renewal of a driving licence is made previous to, or not more than thirty days after the date of its expiry, the fee payable for such renewal shall be such as may be prescribed by the Central Government in this behalf;

(4) Where an application for the renewal of a driving licence is made more than thirty days after the date of its expiry the fee payable for such renewal shall be such amount as may be prescribed by the Central Government :

Provided that the fee referred to in sub-section (3) may be accepted by the licensing authority in respect of an application for the renewal of a driving licence made under this sub-section if it is satisfied that the applicant was prevented by good and sufficient cause from applying within the time specified in sub-section (3) :

Provided further that if the application is made more than five years after the driving licence has ceased to be effective the licensing authority may refuse to renew the driving licence unless the applicant, undergoes and passes to its satisfaction the test of competence to drive referred to in sub-section (3) of S. 9.

(5) Where the application for renewal has been rejected, the fee paid shall be refunded to such extent and in such manner as may be prescribed by the Central Government.

(6) Where the authority renewing the driving licence is not the authority which issued the driving licence it shall intimate the fact of renewal to the authority which issued the driving licence.

16. Revocation of driving licence on grounds of disease or disability.- Notwithstanding anything contained in the foregoing sections, any licensing authority may at any time revoke a driving licence or may require, as a condition of continuing to hold such driving licence, the holder thereof to produce a medical certificate in the same form and in the same manner as is referred to in sub-section (3) of S. 8 if the licensing authority has reasonable grounds to believe that the holder of the driving licence is, by virtue of any disease or disability, unfit to drive a motor vehicle and where the authority revoking a driving licence is not the authority which issued the same, it shall intimate the fact of revocation to the authority which issued that licence.”

5. Section 19 provides for power of the licensing authority to disqualify from holding a driving licence or revoke such licence.

6. Section 20 empowers the Court to disqualify a person in the event a person is convicted of an offence under the Motor Vehicles Act or of an offence in the commission of which a motor vehicle was used.

7. Section 21 provides for suspension of driving licence in certain cases. Section 23 provides for effect of disqualification order. Section 27 provides for the power of the Central Government to make rules.

8. Chapter II of the Act deals with the provisions of licensing of drivers of motor vehicles.

9. Section 147 of the Act provides for requirements of policies and limits of liability. Section 149 provides for the duty of insurers to satisfy judgments and award against persons insured in respect of third party risks. Sub-section (1) of S. 149 postulates that in the event of a certificate of insurance has been issued in terms of sub-section (3) of S. 147 a judgment or award in respect of any such liability is obtained by the insured, the insurer notwithstanding its entitlement to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment-debtor, in respect of the liability, together with any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments. Sub-section (2) of S. 149 of the Act, however, seeks to make an exception thereto. Sub-sections (4), (5) and (7) of S. 149 read thus :

“(4) Where a certificate of insurance has been issued under sub-section (3) of S. 147 to the person by whom a policy has been effected, so much of the policy as purports to restrict the insurance of the persons insured thereby by reference to any condition other than those in Cl. (b) of sub-section (2) shall, as respects such liabilities as are required to be covered by a policy under Cl. (b) of sub-section (1) of S. 147, be of no effect :

Provided that any sum paid by the insurer in or towards the discharge of any liability of any person which is covered by the policy by virtue only of this sub-section shall be recoverable by the insurer from that person.

(5) If the amount which an insurer becomes liable under this section to pay in respect of a liability incurred by a person insured by a policy exceeds the amount for which the insurer would apart from the provisions of this section be liable under the policy in respect of that liability, the insurer shall be entitled to recover the excess from that person.

(7) No insurer to whom the notice referred to in sub-section (2) or sub-section (3) has been given shall be entitled to avoid his liability to any person entitled to the benefit of any such judgment or award as is referred to in sub-section (1) or in such judgment as is referred to in sub-section (3) otherwise than in the manner provided for in sub-section (2) or in the corresponding law of the reciprocating country, as the case may be.”

Section 165 of the Act provides as under:

“165. Claims Tribunals.- (1) A State Government may, by Notification in the Official Gazette, constitute one or more Motor Accidents Claims Tribunals (hereafter in this chapter referred to as Claims Tribunal) for such area as may be specified in the Notification for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both.

Explanation.- For the removal of doubts, it is hereby declared that the expression “claims for compensation in respect of accidents involving the death of or bodily injury to persons arising out of the use of motor vehicles” includes claims for compensation under S. 140 (and S. 163-A).

(2) A Claims Tribunal shall consist of such number of members as the State Government may think fit to appoint and where it consists of two or more members, one of them shall be appointed as the Chairman thereof.

(3) A person shall not be qualified for appointment as a member of a Claims Tribunal unless he-

(a) is, or has been, a Judge of a High Court, or (b) is, or has been a District Judge, or

(c) is qualified for appointment as a High Court Judge

(or as a District Judge).

(4) Where two or more Claims Tribunals are constituted for any area, the State Government, may by general or special order, regulate the distribution of business among them.”

Section 168 of the Act provides as follows:

“168. Award of the Claims Tribunal.- On receipt of an application for compensation made under Section 166, the Claims Tribunal shall, after giving notice of the application to the insurer and after giving the parties (including the insurer) an opportunity of being heard, hold an inquiry into the claim or, as the case may be, each of the claims and, subject to the provisions of S. 162 may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom compensation shall be paid and in making the award the Claims Tribunal shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them, as the case may be :

Provided that where such application makes a claim for compensation under S. 140 in respect of the death or permanent disablement of any person, such claim and any other claim (whether made in such application or otherwise) for compensation in respect of such death or permanent disablement shall be disposed of in accordance with the provisions of Chapter X.

(2) The Claims Tribunal shall arrange to deliver copies of the award to the parties concerned expeditiously and in any case within a period of fifteen days from the date of the award.

(3) When an award is made under this section, the person who is required to pay any amount in terms of such award shall, within thirty days of the date of announcing the award by the Claims Tribunal, deposit the entire amount awarded in such manner as the Claims Tribunal may direct.”

10. r. Harish Salve and Mr. M. L. Verma, learned senior counsel appearing on behalf of the insurer made the following submissions in support of these petitions.

(1) The insurer in terms of sub-section (2) of S. 149 of the Act has an absolute right to raise a defence specified, inter alia, in sub-clause (ii) of Cl. (a) thereof;

(2) Such a right being clear and unequivocal having regard to the judgment of this Court in National Insurance Company Ltd., Chandigarh vs. Nicolletta Rohtagi and others (2002) 7 SCC 456) must be allowed to be invoked by the insurer to its full effect. In the proceedings before the Tribunal, the insurers, thus, were entitled to show that the vehicle involved in the accident at the material point of time was driven by a person who was not ‘duly licensed’ or was ‘disqualified to hold a licence.’

(3) A person cannot be said to be ‘duly licensed’ unless he has been granted a permanent licence for driving a particular vehicle in terms of the provisions of Chapter II of the Motor Vehicles Act and, thus, a vehicle cannot be held to be driven by a person duly licensed therefor if : (a) he does not hold a licence; (b) he holds a fake licence; (c) he holds a licence but the validity thereof has expired; or (d) he does not hold a licence for the type of vehicle which he was driving in terms of Chapter II of the Motor Vehicles Act, 1988, or (e) he holds merely a learner’s licence. Reliance in this behalf has been placed on New India Assurance Co. Ltd. vs. Mandar Madhav Tambe and others (1996) 2 SCC 328) and United India Insurance Co. Ltd. vs. Gian Chand and others (1997) 7 SCC 558).

(4) Once the defence by the insurer is established in the proceedings before the Tribunal, it is bound to discharge the insurer and fix the liability only on the owner and/or the driver of the vehicle.

(5) Once it is held that the insurer has been able to establish its defence, the Tribunal or the Court cannot direct the insurance companies to pay the awarded amount to the claimant and in turn recover the same from the owner and the driver of the vehicle.

11.The decisions of this Court in New India Assurance Co., Shimla vs. Kamla and others etc. (2001) 4 SCC 342) and United India Insurance Company Ltd. vs. Lehru and others (2003) 3 SCC 338) wherein it has been held that the Court is entitled to issue a direction upon the insurer to satisfy the award and thereafter recover the same from the owner of the vehicle do not lay down the correct law and should be overruled.

12. The learned counsel appearing on behalf of the respondents, who are third party claimants on the other hand, submitted :

(i) that the Parliament deliberately used two different expressions ‘effective licence’ in S. 3 and ‘duly licensed’ in sub-section (2) of S. 149 of the Act which are suggestive of the fact that a driver once licensed, unless he is disqualified, would continue to be a duly licensed person for the purpose of Chapter XI of the Act.

(ii) Thus, once a person has been duly licensed but has not renewed his licence, the same would not come within the purview of S. 149 and thus would not constitute a statutory defence available to the insurer in terms thereof. Only in the event of lapse of five years from the date of expiry of the licence, such statutory defence may be raised.

(iii) Once a certificate of insurance is issued in terms of the provisions of the Act, the insurer has a liability to satisfy an award. It has been pointed that a major departure has been made in the 1988 Act insofar as in terms of S. 96(2)(b) of the 1939 Act all the statutory defences were available in terms of sub-section (3) thereof provided that the policy conditions other than those prescribed therein had no effect, whereas in the new Act, Section 149(2)(a) prescribes that the policy is void if it is obtained by non-disclosure of material fact. Section 149(4) confines to only Cl. (b) and states that the conditions of policy except as mentioned in Cl. (b) of sub-section (2) are of no effect and, thus, after the amendment, except in cases which are covered under Cl. (b) of S. 149, the insurance companies are liable to pay to the third parties. In other words, the right of insurer to avoid the claim of the third party would arise only when the policy is obtained by misrepresentation of material fact and fraud and in no other case.

(iv) Sub-section (1) of S. 149 makes it clear that the insurer should pay first to the third parties and recover the same if they are absolved on any of the grounds specified in sub-section (2) thereof. Reliance, in this connection, has been placed on BIG Insurance Co. Ltd. vs. Captain Itbar Singh and others (AIR 1959 SC 1331) and New India Assurance Company vs. Kamla and others (2001) 4 SCC 342).

(v) The burden to prove the defence raised by the insurers as regard the question as to whether there has been any breach of violation of policy conditions of the insurance policy has been issued or not, would be upon the insurer.

(vi) The breach on the part of the insured must be a wilful one being of fundamental condition by the insured himself and the burden of proof, therefore, would be on the insurer.

(vii) With a view to avoid its liabilities it is not sufficient for the insurer to show that the person driving at the time of accident was not duly licensed but it must further be established that there was a breach on the part of the insured. Reliance, in this connection, has been placed on Narcinva V. Kamath and another vs. Alfredo Antonio Doe Martins and others (1985) 2 SCC 574), Skandia Insurance Company Ltd. vs. Kokilaben Chandevadan and others (1987) 2 SCC 654); Sohan Lal Passi vs. P. Sesh Reddy and others (1996) 5 SCC 21) and United India Insurance Company Ltd. vs. Lehru and others (2003) 3 SCC 338) .

13. Before we deal with various contentions raised by the parties it is desirable to look into the legislative history of the provisions for its interpretation. The relevant provisions of the Act indisputably are beneficent to the claimant. They are in the nature of a Social Welfare Legislation.

14. Chapter XI of the Motor Vehicles Act, 1988, inter alia, provides for compulsory insurance of vehicles in relation to the matters specified therefor. The provision for compulsory insurance indisputably has been made inter alia with a view to protect the right of a third party.

This Court in Sohan Lal Passi (supra) noted :

“10. The road accidents in India have touched a new height. In majority of cases because of the rash and negligent driving, innocent persons become victims of such accidents because of which their dependents in many cases are virtually on the streets. In this background, the question of payment of compensation in respect of motor accidents has assumed great importance for public as well as for Courts. Traditionally, before the Court directed payment of tort compensation, it had to be established by the claimants that the accident was due to the fault of the person causing injury or damage. Now from different judicial pronouncements, it shall appear that even in western countries fault is being read and assumed as someone’s negligence or carelessness. The Indian Parliament, being conscious of the magnitude of the plight of the victims of the accidents, have introduced several beneficial provisions to protect the interest of the claimants and to enable them to claim compensation from the owner or the insurance company in connection with the accident.”

15. The intention of the Parliament became further evident when in the Motor Vehicles Act, 1939, a new chapter being Chapter VIIA dealing with insurance of motor vehicles against third party risks was introduced and the beneficent provisions contained in the Motor Vehicles Act, 1939 were further made liberal by reason of the Motor Vehicles Act, 1988 and the amendments carried out therein from time to time in aid of the third party claims by way of grant of additional or new rights conferred on the road accident victims.

16. Under the common law a person injured by reason of another person’s wrongdoing had no right of action against insurers who undertook to indemnify the wrongdoer. The first invasion of this principle took place by reason Third Parties (Rights Against Insurers) Act, 1930. The British Parliament in the light of the aforementioned Act enacted the Road Traffic Act, 1930 which has since been replaced by Road Traffic Act, 1988.

17. The Third Parties (Rights Against Insurers) Act, 1930 was enacted with a view to correct injustice effecting a statutory assignment of the rights of the assured to the injured person as prior thereto the right of a person to be indemnified under a contract of insurance against claims made against him by persons whom he might have injured was one personal to himself, and there was no privity of any sort between the injured person and the insurers. The injured person had no interest either at law or in equity in the insurance money, either before or after it was paid by the insurers to the assured. In a case where the assured became bankrupt and if the injured person had not already obtained judgment and levied execution of his claim for damages his only rights was to move in the bankruptcy or the winding up of proceedings. The beneficial provisions of the aforementioned English statutes were incorporated by the Parliament of India while enacting the Motor Vehicles Act, 1939 which has also since been repealed and replaced by the Motor Vehicles Act, 1988.

18. Concededly different types of insurance covers are issued containing different nature of contract of insurance. We are, however, in this batch of cases mainly concerned with third party right under the policy. Any condition in the insurance policy, whereby the right of the third party is taken away, would be void.

19. Indisputably such a benefit to a third party was provided under the Statute keeping in view the fact that the conditions in the assured’s policy may not be of no or little effect in relation to a claim by a person to whom an assured was under a compulsorily insurable liability.

20. In this context, it is necessary to consider as to what is a third party right. A third party claim arises when a victim of an accident suffers a bodily injury or death as a result thereof or his property is damaged. An accident is not susceptible to a very precise definition.

21. The popular and ordinary sense of the word was “an unlooked for mishap or an untoward event which is not expected or designed.”

22. In R. V. Morris (1972) 1 WLR 228), the Court of appeal defined the word as an “unintended occurrence which has an adverse physical result.” The Supreme Court of Canada in Pickford and Black Ltd. vs. Canadian General Insurance Co. (1976) 2 Lloyd’s Rep 108), stated the law thus :-

“The meaning to be attached to the word “accident” as employed in the body of an insurance policy was thoroughly explored by Mr. Justice Pigeon in the reasons for judgment which he delivered on behalf of the majority of this Court in the Canadian Indemnity Co. vs. Walkem Machinery and Equipment Ltd. (1975) DLR (3d) 1. In the course of these reasons at p. 5 he adopted the views expressed by Mr. Justice Freedman, in a dissenting opinion in the Court of Appeal of Manitoba in Marshall Wells of Canada Ltd. vs. Winnipeg Supply and Fuel; R. Litz and Sons Co. vs. Canadian General Insurance Co. (1964) 49 WWR 644 at p. 665 where that learned Judge said :

With respect, I am of the view that what occurred here was an accident. One must avoid the danger of construing that term as if it were equivalent to “inevitable accident.” That a mishap might have been avoided by the exercise of greater care and diligence does not automatically take it out of the range of accident. Expressed another way, “negligence” and “accident” as here used are not mutually exclusive terms. They may co-exist.

After expressing the view that even an occurrence which is the result of a calculated risk or of a dangerous operation may come within the meaning of the word “accident,” Mr. Justice Pigeon went on to say at p. 6 :

While it is true that the word “accident” is sometimes used to describe unanticipated or unavoidable occurrences, no dictionary need be cited to show that in every day use, the word is applied as Halsbury says… to any unlooked for mishap or occurrence… this is the proper test…”

23. In Halsbury’s Laws of England, Fourth Edition Reissue, it is stated :

“An injury caused by the wilful or even criminal act of a third person, provided the assured is not a party or privy to it, is to be regarded as accidental for the purposes of the policy, since from the assured’s point of view it is not expected or designed.”

24. In Colinvau’s Law of Insurance (6th Edition) page 304, the following illustration is given :

“If a man walks and stumbles, thus spraining his ankle, the injury is accidental for while he intends to walk he does not intend to stumble. In Hamlyn vs. Crown Accidental Insurance the assured’s injury was due to stopping forward to pick up a marble dropped by a child as it rolled from him. He stood with his legs together, separated his knees, leaned forward and made a grab at the marble, and in doing so wrenched his knee. The injury was held by the Court of Appeal to be accidental, on the ground that the assured did not intend to get into such a position that he might wrench his knee.”

25. At para 17-13 of the said treatise it is stated :

“Accident includes negligence

It makes no difference that the accident was caused by the negligence of the assured (as opposed to his intentional act). Thus there is an accident where the assured crosses a railway line without exercising due care and is knocked down by an approaching train. In fact, one of the commonest causes of accidents is negligence, and an accident policy applies, excepted perils apart, whether the injury is caused by the negligent act of the assured himself or of a third party.”

26. A right of the victim of a road accident to claim compensation is a statutory one. He is a victim of an unforeseen situation. He would not ordinarily have a hand in it. The negligence on the part of the victim may, however, be contributory. He has suffered owing to wrongdoing of others. An accident may ruin an entire family. It may take away the only earning member. An accident may result in the loss of her only son to a mother. An accident may take place for variety of reasons. The driver of a vehicle may not have a hand in it. He may not be found to be negligent in a given case. Other factors such as unforeseen situation, negligence of the victim, bad road or the action or inaction of any other person may lead to an accident.

27. A person suffering grievous bodily injury may require money for his survival/medical treatment. Statutory compensation paid to the next of kin of the victim of an accident may, thus, bring to a large number of families the only ray of light at the end of the tunnel.

28. In other words, what would also be covered by the contract of insurance vis-a-vis the beneficent statutory provisions like sub-section (2) of Section 149 of the said Act would be when a death or bodily injury has been caused as a result of assured’s own voluntary act. Even an unforeseeable result of assured’s deliberate act may come within the purview of the accident. Even if an accident has occurred due to negligent driving of the assured person, it may not prevent recovery under the policy and certainly thereby a third party would not be non-suited.

29.However, we may notice that in C.M. Jaya’s case (supra), a Constitution Bench of this Court held that the liability of the insurer will have to be determined having regard to the question as to whether any extra premium is paid or not. It was observed:

“. . . The said decision cannot be read as laying down that even though the liability of the Insurance Company is limited to the statutory requirement, an unlimited or higher liability can be imposed on it. The liability could be statutory or contractual. A statutory liability cannot be more than what is required under the statute itself. However, there is nothing in Section 95 of the Act prohibiting the parties from contracting to create unlimited or higher liability to cover wider risk. In such an event, the insurer is bound by the terms of the contract as specified in the policy in regard to unlimited or higher liability as the case may be. In the absence of such a term or clause in the policy, pursuant to the contract of insurance, a limited statutory liability cannot be expanded to make it unlimited or higher. If it is so done, it amounts to rewriting the statute or the contract of insurance which is not permissible.”

30. For the aforementioned reasons, the provisions contained in Chapter XI of the Motor Vehicles Act, 1988 must be construed in that light.

31. Sub-section (1) of Section 149, casts a liability upon the insurer to pay to the person entitled to the benefit of the decree as if he were the judgment debtor. Although the said liability is subject to the provisions of this section, it prefaces with a non-obstante clause that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy. Furthermore, the statute raises a legal fiction to the effect that for the said purpose the insurer would be deemed to be judgment debtor in respect of the liability of the insurer.

32. In Halsbury’s Laws of England, Fourth Edition Reissue, Volume 25, it is stated :

“743. Benefits conferred on third parties by the Road Traffic Act, 1930. It was against the background of the Third Parties (Rights against Insurers) Act 1930 that the Road Traffic Act 1930 (now replaced by the Road Traffic Act 1988), was passed. It was realised that, unless some alterations were made in the rights to which the third party was by the first-named Act subrogated, those rights would frequently be of little, if any, value. Accordingly, it was provided that certain conditions in the assured’s policy were to be of no effect in relation to a claim by a person to whom an assured was under a compulsorily insurable liability. The conditions to that extent avoided are any conditions providing (1) that no liability is to arise, or (2) that any liability which has arisen is to cease, in the event of some specified thing being done, or omitted to be done, after the occurrence of the event giving rise to the claim. If, therefore, any admission of liability is made after an accident contrary to a condition in the policy, or if, contrary to a condition in the policy, proper notice of the accident is not given to the insurers, the injured third party is not affected so far as his claim is concerned.”

33. This Court in Nicolletta Rohtagi (supra) which has since been followed in Sadhana Lodh vs. National Insurance Company Ltd. and another reported in (2003) 1 SCR 567 in no uncertain terms held that the defence available to an insurance company would be a limited one.

34. The question as to whether an insurer can avoid its liability in the event it raises a defence as envisaged in sub-section (2) of Section 149 of the Act corresponding to sub-section (2) of Section 96 of the Motor Vehicles Act, 1939 had been the subject-matter of decisions in the large number of cases.

35. It is beyond any doubt or dispute that under Section 149(2) of the Act an insurer, to whom notice of the bringing of any proceeding for compensation has been given, can defend the action on any of the grounds mentioned therein.

36. However, Clause (a) opens with the words “that there has been a breach of a specified condition of the policy”, implying that the insurer’s defence of the action would depend upon the terms of the policy. The said sub-clause contains three conditions of disjunctive character, namely, the insurer can get away from the liability when (a) a named person drives the vehicle; (b) it was being driven by a person who did not have a duly granted licence; and (c) driver is a person disqualified for holding or obtaining a driving licence.

37. We may also take note of the fact that whereas in Section 3 the words used are ‘effective licence’, it has been differently worded in Section 149(2) i.e. ‘duly licensed’. If a person does not hold an effective licence as on the date of the accident, he may be liable for prosecution in terms of Section 141 of the Act but Section 149 pertains to insurance as regard third party risks.

38. A provision of a statute which is penal in nature vis-a-vis a provision which is beneficent to a third party must be interpreted differently. It is also well known that the provisions contained in different expressions are ordinarily construed differently.

39. The words ‘effective licence’ used in Section 3, therefore, in our opinion cannot be imported for sub-section (2) of Section 149 of the Motor Vehicles Act. We must also notice that the words ‘duly licensed’ used in sub-section (2) of Section 149 are used in past tense.

40. Thus, a person whose licence is ordinarily renewed in terms of the Motor Vehicles Act and the rules framed thereunder despite the fact that during the interregnum period, namely, when the accident took place and the date of expiry of the licence, he did not have a valid licence, he could during the prescribed period apply for renewal thereof and could obtain the same automatically without undergoing any further test or without having been declared unqualified therefor. Proviso appended to Section 14 in unequivocal term states that the licence remains valid for a period of thirty days from the day of its expiry.

41. Section 15 of the Act does not empower the authorities to reject an application for renewal only on the ground that there is a break in validity or tenure of the driving licence has lapsed as in the meantime the provisions for disqualification of the driver contained in Sections 19, 20, 21, 22, 23 and 24 will not be attracted, would indisputably confer a right upon the person to get his driving licence renewed. In that view of the matter he cannot be said to be delicensed and the same shall remain valid for a period of thirty days after its expiry.

42. If a person has been given a licence for a particular type of vehicle as specified therein, he cannot be said to have no licence for driving another type of vehicle which is of the same category but of different type. As for example when a person is granted a licence for driving a light motor vehicle he can drive either a car or a jeep and it is not necessary that he must have driving licence both for car and jeep separately.

43. Furthermore, the insurance company with a view to avoid its liabilities is not only required to show that the conditions laid down under Section 149(2)(a) or (b) are satisfied but is further required to establish that there has been a breach on the part of the insured. By reason of the provisions contained in the 1988 Act, a more extensive remedy has been conferred upon those who have obtained judgment against the user of a vehicle and after a certificate of insurance is delivered in terms of Section 147(3) a third party has obtained a judgment against any person insured by the policy in respect of a liability required to be covered by Section 145, the same must be satisfied by the insurer, notwithstanding that the insurer may be entitled to avoid or to cancel the policy or may in fact have done so. The same obligation applies in respect of a judgment against a person not insured by the policy in respect of such a liability, but who would have been covered if the policy had covered the liability of all persons, except that in respect of liability for death or bodily injury.

44. Such a breach on the part of the insurer must be established by the insurer to show that not only the insured used or caused or permitted to be used the vehicle in breach of the Act but also that the damage he suffered flowed from the breach.

45. Under the Motor Vehicles Act, holding of a valid driving licence is one of the conditions of contract of insurance. Driving of a vehicle without a valid licence is an offence. However, the question herein is whether a third party involved in an accident is entitled to the amount of compensation granted by the Motor Accidents Claims Tribunal although the driver of the vehicle at the relevant time might not have a valid driving licence but would be entitled to recover the same from the owner or driver thereof.

46. It is trite that where the insurers relying upon the provisions of violation of law by the assured takes an exception to pay the assured or a third party, they must prove a wilful violation of the law by the assured. In some cases violation of criminal law, particularly, violation of the provisions of the Motor Vehicles Act may result in absolving the insurers but, the same may not necessarily hold good in the case of third party. In any event, the exception applies only to acts done intentionally or “so recklessly as to denote that the assured did not care what the consequences of his act might be”.

47. In Narvinva’s case (supra), a Division Bench of this Court observed :

“. . . The insurance company complains of breach of a term of contract which would permit it to disown its liability under the contract of insurance. If a breach of term of contract permits a party to the contract to not to perform the contract, the burden is squarely on that party which complains of breach to prove that the breach has been committed by the other party to the contract. The test in such a situation would be who would fail if no evidence is led. . .”

48. In Skandia’s case (supra), this Court held :

“Section 96(2)(b)(ii) extends immunity to the insurance company if a breach is committed of the 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 from holding or obtaining driving licence during the period of disqualification. The expression “breach”, is of great significance. The dictionary meaning of “breach” is “infringement or violation of a promise or obligation” (See Collins English Dictionary). It is, therefore, abundantly clear that the insurer will have to establish that the insured is guilty of an infringement or violation of the promise that a person who is duly licensed will have to be in charge of the vehicle. The very concept of infringement or violation of the promise that the expression “breach” carries within itself induces an inference that the violation or infringement on the part of the promisor must be wilful infringement or violation. If the insured is not at all at fault and has not done anything he should not have done or is not amiss in any respect, how can it be conscientiously posited that he has committed a breach? It is only when the insured himself places the vehicle in charge of a person who dies not hold a driving licence, that it can be said that he is “guilty” of the breach of the promise that the vehicle will be driven by a licensed driver. It must be established by the insurance company that the breach was on the part of the insured and that it was the insured who was guilty of violating the promise or infringement of the contract. Unless the insured is at fault and is guilty of a breach, the insurer cannot escape from the obligation to indemnify the insured and successfully contend that he is exonerated having regard to the fact that the promisor (the insured) committed a breach of his promise. Not when some mishap occurs by some mischance. When the insured has done everything within his power inasmuch as he has engaged a licensed driver and has placed the vehicle in charge of a licensed driver, with the express or implied mandate to drive it himself, it cannot be said that the insured is guilty of any breach.”

49. In B. V. Nagaraju vs. M/s. Oriental Insurance Co. Ltd. (AIR 1996 SC 2054), Punchhi, J. speaking for the Division Bench followed Skandia (supra) and read down the exclusionary term of the insurance policy to save the main purpose thereof, holding :

“The National Commission went for the strict construction of the exclusion clause. The reasoning that the extra passengers being carried in the goods vehicle could not have contributed, in any manner, to the occurring of the accident, was barely noticed and rejected sans any plausible account; even when the claim confining the damage to the vehicle only was limited in nature. We, thus, are of the view in accord with the Skandia’s case (AIR 1987 SC 1184), the aforesaid exclusion term of the insurance policy must be read down so as to serve the main purpose of the policy that is indemnify the damage caused to the vehicle, which we hereby do.”

50. A contract of insurance also falls within the realm of contract. Thus, like any other contract, the intention of the parties must be gathered from the expressions used therein.

51. Ivamy in his treatise ‘Fire and Motor Insurance’ (2nd Edition) at page 272-273 narrated an interesting case concerning Employment of “under age” driver in Sweeney vs. Kennedy (1948) 82 LIL Rep 294 at 297) as under :

“In Sweeney vs. Kennedy the proposer in answer to a question stating “Are any of your drivers under twenty-one years of age or with less than twelve months’ experience” replied “No”. One of the lorries covered by the policy was involved in an accident whilst it was being unloaded, and a third party was fatally injured. At the time of the accident it was being driven by the insured’s son, who had twelve months’ driving experience but was under twenty-one. When a claim for an indemnity was made against the insurance company, payment was refused on the ground that the employment of a driver under twenty-one years of age amounted to such an alteration in the character of the risk as would avoid the policy.

Kingsmil Moore, J., giving judgment in the Eire Divisional Court, rejected this argument and held that the company was liable. He said that whether a change of risk was so great as to avoid an insurance must always be a question of degree and a question of the opinion of the Court on the circumstances of the case. He could see a vast difference between the risks involved in insuring a merchantman and a privateer; a smaller but still very substantial difference between the risk involved in insuring an explosive and non-explosive demolition; and a very exiguous difference between the risks of insuring when a driver was under or over-twenty-one.

He then observed :

“The law provides that licences to drive motor vehicles may be given to persons of specified ages, the ages varying with the class of the vehicle; and when a person is driving a vehicle of the category which by his age he is entitled to drive, there is, I think, some presumption that, as far as age reflects on competency, he is competent to drive it. Certainly this would be an honest and reasonable view for an insured person to take in a case where he had not been expressly limited by the terms of the policy to the employment of drivers over 21. Certain categories of vehicles may not, by law, be driven by persons under 21, and as the framework of the proposal form was apt to cover an application for insurance of such vehicle, he might reasonably consider that Q. 9 was designed to all attention to this fact. If insurers take a different view as to the proposer age of drivers from the view of the law, it is open to them – indeed, I would say incumbent upon them – to make this clear by the insertion of specific provisions in the policy and not attempt to secure their ends by a side wind. I hold that there was no such alteration in the subject-matter of the insurance as would or could avoid the policy.”

52. In the event the terms and conditions of policy are obscure it is permissible for the purpose of construction of the deed to look to the surrounding circumstances as also the conduct of the parties.

53.In Oriental Insurance Co. Ltd. vs. Sony Cheriyan (1999) 6 SCC 451), it has been held:

“The insurance policy between the insurer and the insured represents a contract between the parties. Since the insurer undertakes to compensate the loss suffered by the insured on account of risks covered by the insurance policy, the terms of the agreement have to be strictly construed to determine the extent of liability of the insurer. The insured cannot claim anything more than what is covered by the insurance policy. That being so, the insured has also to act strictly in accordance with the statutory limitations or terms of the policy expressly set out therein.”

54.Yet in Oriental Insurance Co. Ltd. vs. Samayanallur Primary Agricultural Co-op. Bank (AIR 2000 SC 10), this Court laid down the law in the following terms :

“The State Commission appreciated the real controversy between the parties and decided the dispute on interpretation of the insurance policies and the proposal produced before the District Forum. There was no necessity of referring to the dictionaries for understanding the meaning of the word ‘safe’ which the parties in the instant case are proved to have understood while submitting the proposal and accepting the insurance policy. The cashier’s box could not be equated with the safe within the meaning of the insurance policy. The alleged burglary and the removal of the cash box containing the jewellery and cash was not covered by the insurance policy between the parties. The insurance policy has to be construed having reference only to the stipulations contained in it and no artificial far-fetched meaning could be given to the words appearing in it.”

55. The Courts also readily apply the doctrine of waiver in favour of the insured and against the insurer.

56. The insurer’s liability arises both from contract as well as statute. It will, therefore, may not be proper to apply the rules for interpretation of a contract for interpreting a statute.

57.The correctness of the decision rendered in Skandia’s case (supra) was questioned and the matter was referred to a three-Judge Bench to which we shall advert to a little later.

58.Gian Chand’s case (supra) relied on behalf of the petitioner is of not much assistance. Therein this Court was dealing with peculiar fact-situation obtaining therein. In that case the insured admittedly did not have any driving licence and in that situation, the insurance company was held to be not liable. The Bench noticed the purported conflict between the two sets of decisions but did not refer the matter to a larger Bench. It merely distinguished the cases on their own facts stating :

“Under the circumstances, when the insured had handed over the vehicle for being driven by an unlicensed driver, the Insurance Company would get exonerated from its liability to meet the claims of the third party who might have suffered on account of vehicular accident caused by such unlicensed driver. In view of the aforesaid two sets of decisions of this Court, which deal with different fact-situation, it cannot be said that the decisions rendered by this Court in Skandia Insurance Co. Ltd. vs. Kokilaben Chandravadan and the decision of the Bench of three learned Judges in Sohan Lal in any way conflict with the decisions rendered by this Court in the cases of New India Assurance Co. Ltd. vs. Mandar Madhav Tambe and Kashiram Yadav vs. Oriental Fire and General Insurance Co.”

59. There may be a case where an accident takes place without there being fault on the part of the driver. In such an event, the question as to whether a driver was holding a valid licence or not would become redundant. (See Jitendra Kumar vs. Oriental Insurance Co. Ltd. and another, JT 2003 (5) SC 538.

60. Skandia (supra), on the other hand, has been approved by a three-Judge Bench, when the correctness thereof was referred to a larger Bench in Sohan Lal Passi’s case (supra) wherein a three-Judge Bench of this Court noticed the ratio propounded in Skandia’s case (supra) and observed :

“. . . In other words, once there has been a contravention of the condition prescribed in sub-section (2)(b)(ii) of Section 96, the person insured shall not be entitled to the benefit of sub-section (1) of Section 96. According to us, Section 96(2)(b)(ii) should not be interpreted in a technical manner. Sub-section (2) of Section 96 only enables the insurance company to defend itself in respect of the liability to pay compensation on any of the grounds mentioned in sub-section (2) including that there has been a contravention of the condition excluding the vehicle being driven by any person who is not duly licensed. This bar on the face of it operates on the person insured. If the person who has got the vehicle insured has allowed the vehicle to be driven by a person who is not duly licensed then only that clause shall be attracted. In a case where the person who has got insured the vehicle with the insurance company, has appointed a duly licensed driver and if the accident takes place when the vehicle is being driven by a person not duly licensed on the basis of the authority of the driver duly authorised to drive the vehicle whether the insurance company in that event shall be absolved from its liability? The expression ‘breach’ occurring in Section 96(2)(b) means infringement or violation of a promise or obligation. As such the insurance company will have to establish that the insured was guilty of an infringement or violation of a promise. The insurer has also to satisfy the Tribunal or the Court that such violation or infringement on the part of the insured was wilful. If the insured has taken all precautions by appointing a duly licensed driver to drive the vehicle in question and it has not been established that it was the insured who allowed the vehicle to be driven by a person not duly licensed, then the insurance company cannot repudiate its statutory liability under sub-section (1) of Section 96. . .”

61. A bare perusal of the provisions of Section 149 of the Act leads to only one conclusion that usual rule is that once the assured proved that the accident is covered by the compulsory insurance clause, it is for the insurer to prove that it comes within an exception.

62. In MacGillivray on Insurance Law it is stated :

“25-82. Burden of Proof : Difficulties may arise in connection with the burden of proving that the facts of any particular case fall within this exception. The usual rule is that once the assured has proved that the case comes within the general risk, it is for the insurers to prove that it comes within an exception. It has therefore been suggested in some American decisions that, where the insurers prove only that the assured exposed himself to danger and there is no evidence to show why he did so, they cannot succeed, because they have not proved that his behaviour was voluntary or that the danger was unnecessary. Since an extremely heavy burden is imposed on the insurers if they have to prove the state of mind of the assured, it has been suggested in Canadian decisions that the Court should presume that the assured acted voluntarily and that, where he does an apparently dangerous and foolish act, such danger was unnecessary, until the contrary is shown. In practical terms, therefore, the onus does in fact lie on the claimant to explain the conduct of the assured where there is no apparent reason for exposing himself to an obvious danger.”

63. In Rukmani and others vs. New India Assurance Co. Ltd. and others (1999 ACJ 171), this Court while upholding the defences available to the insurer to the effect that vehicle in question was not being driven by a person holding a licence, held that the burden of the insurer would not be discharged when the evidence which was brought on record was that the Inspector of Police in his examination-in-chief merely stated. “My enquiry revealed that the respondent No. 1 did not produce the licence to drive the abovesaid scooter. The respondent No. 1 even after my demand did not submit the licence since he was not having it.”

64. The proposition of law is no longer res integra that the person who alleges breach must prove the same. The insurance company is, thus, required to establish the said breach by cogent evidence. In the event, the insurance company fails to prove that there has been breach of conditions of policy on the part of the insured, the insurance company cannot be absolved of its liability. [See Sohan Lal Passi (supra)].

65. Apart from the above, we do not intend to lay down anything further i.e. degree of proof which would satisfy the aforementioned requirement inasmuch as the same would indisputably depend upon the facts and circumstances of each case. It will also depend upon the terms of contract of insurance. Each case may pose different problem which must be resolved having to a large number of factors governing the case including conduct of parties as regard duty to inform, correct disclosure, suppression, fraud on the insurer etc. It will also depend upon the fact as to who is the owner of the vehicle and the circumstances in which the vehicle was being driven by a person having no valid and effective licence. No hard and fast rule can therefor be laid down. If in a given case there exists sufficient material to draw an adverse inference against either the insurer or the insured, the Tribunal may do so. The parties alleging breach must be held to have succeeded in establishing the breach of conditions of contract of insurance on the part of the insurer by discharging its burden of proof. The Tribunal, there cannot be any doubt, must arrive at a finding on the basis of the materials available on records.

66. In the aforementioned backdrop, the provisions of sub-sections (4) and (5) of Section 149 of the Motor Vehicles Act, 1988 may be considered as the liability of the Insurer to satisfy the decree at the first instance.

67.A beneficent statute, as is well known, must receive a liberal interpretation (See Bangalore Water Supply and Sewerage Board etc. vs. A. Rajappa and others etc. (1978) 2 SCC 213), Steel Authority of India Ltd. and others vs. National Union Waterfront Workers and others (2001) 7 SCC 1), ITI Ltd. vs. Siemens Public Communications Network Ltd. (2002) 5 SCC 510), Amrit Bhikaji Kale and others vs. Kashinath Janardhan Trade and another (1983) 3 SCC 437) and Kunal Singh vs. Union of India and another (2003) 4 SCC 524).

68. The liability of the insurer is a statutory one. The liability of the insurer to satisfy the decree passed in favour of a third party is also statutory.

69. In Halsbury’s Laws of England, Fourth Edition Reissue, Volume 25, it is stated :

“749. Judgments required to be satisfied. The first condition of the obligation of the insurers to pay on a judgment is that there is a judgment.

The Second condition is that the judgment must be in respect of a liability which is required to be covered by compulsory insurance. In other words, the only person who can maintain a right of action direct against the insurers is a person falling within the class of third parties whose bodily injury or death or damage to whose property is required to be covered by a motor policy.

The third condition is that the liability is, in fact, covered by the terms of the policy, or would be covered but for the fact that the insurer is entitled to avoid or cancel, or has avoided or cancelled, the policy. For this purpose conditions declared to be invalid as against a third party are ignored, but if, even after ignoring all such conditions, the relevant use of the vehicle puts it outside the scope of the policy, the insurers are left immune. The most important clause in this connection is the ‘description of use’ clause. The assured is criminally liable if he uses his car for purposes outside the scope of his insurance and, in addition to his criminal liability, he has to bear unaided the cost of compensating third parties injured by his use if he is negligent. Subject to the statutory provision rendering certain conditions invalid against third parties, the insurers are not obliged to carry a wider scope of liability that they have agreed by their policy to carry.

The fourth condition is that the judgment must be against a person insured by the policy. This language covers a permitted driver as well as the person by whom the policy has been effected.”

70. As has been held in Sohan Lal Passi (supra), the insurance company cannot shake off its liability to pay the compensation only by saying that at the relevant point of time the vehicle was driven by a person having no licence.

71. Thus, where a liability has been established by a judgment, it is not permissible to look beyond the determination in order to establish the basis of the liability.

72.In United Insurance Co. Ltd. vs. Jaimy and others (1998 ACJ 1318), it is stated :

“Section 149(2) relates to the liability of the insurer and speaks of a situation in regard to which no sum shall be payable by an insurer to whom notice of bringing of any such proceeding is given, could defend the action stated in the said statutory provision. The contention in the context would be found in Section 149(2)(a) in the event of a breach of a specified condition of the policy enabling the insurer to avoid liability in regard thereto. In the process in regard to the right of the insurer to recover the amount from the insured, it would have to be seen by referring to Section 149(4) successfully recovered from the insured.

Section 149(4) says that where a certificate of insurance is issued, so much of the said policy as purports to restrict the insurance of the persons insured thereby by referring to any of the conditions mentioned and it is precisely enacted in regard thereto and that the liability covered by Section 2(b) as are required to be covered by the policy would not be available. The position is made further clear by the provisions enacting that any sum paid by the insurer in or towards the discharge of any liability of any person who is covered by the policy by virtue of this sub-section shall be recoverable by the insurer from that person.

In other words, Section 149(4) considers the right of the insurance company in regard to re-imbursement of the amount paid by them only in the context of a situation other than the one contemplated under Section 149(2)(b). It would mean that except under the situation provided by Section 149(2)(b), the insurer would not be in a position to avoid the liability because he has got rights against the owner under the above provision.

The learned counsel strenuously submitted that this would not be the correct understanding and interpretation of the statutory provisions of Section 149 of the 1988 Act. The learned counsel submitted that to read the statutory provision to understand that the insurance company could only claim from the owner in situations governed by Section 149(2)(b) and to have no right under the said provision with regard to other situations under Section 149(2)(a) would not be the proper reading of the statutory provision. The learned counsel submitted that in fact the provision would have to be meaningfully understood. It is not possible to consider the submission of the learned counsel in the light of the plain language of the statutory provision. It is necessary to emphasise that under the new Act the burden of the insurance company has been made heavier in the context of controlling the need of taking up contentions to legally avoid the liabilities of the insurance company.”

73. The social need of the victim being compensated as enacted by the Parliament was the subject-matter of consideration before a three-Judge Bench of this Court as early as in 1959 in British India General Insurance Co. Ltd. vs. Captain Itbar Singh and others (1960) 1 SCR 168, wherein Sarkar, J. speaking for the Bench observed:

“Again, we find the contention wholly unacceptable. The Statute has no doubt created a liability in the insurer to the injured person but the statute has also expressly confined the right to avoid that liability to certain grounds specified in it. It is not for us to add to those grounds, and therefore, to the statute for reasons of hardship. We are furthermore not convinced that the statute causes any hardship. First, the insurer has the right, provided he has reserved it by the policy, to defend the action in the name of the assured and if he does so, all defences open to the assured can then be urged by him and there is no other defence that he claims to be entitled to urge. He can thus avoid all hardship if any, by providing for a right to defend the action in the name of the assured and this he has full liberty to do. Secondly, if he has been made to pay something which on the contract of the policy he was not bound to pay, he can under the proviso to sub-section (3) and under sub-section (4) recover it from the assured. It was said that the assured might be a man of straw and the insurer might not be able to recover anything from him. But the answer to that is that it is the insurer’s bad luck. In such circumstances the injured person also would not have been able to recover the damages suffered by him from the assured, the person causing the injuries…….”

74. Similar view has been taken in Skandia’s case (supra), Sohan Lal Passi’s case (supra) Kashiram Yadav and another vs. Oriental Fire and General Insurance Co. Ltd. and others (1989) 4 SCC 128 and several others.

75. In Kamla’s case (supra) a Division Bench of this Court summed up the legal position :

“The position can be summed up thus :

The insurer and the insured are bound by the conditions enumerated in the policy and the insurer is not liable to the insured if there is violation of any policy condition. But the insurer who is made statutorily liable to pay compensation to third parties on account of the certificate of insurance issued shall be entitled to recover from the insured the amount paid to the third parties, if there was any breach of policy conditions on account of the vehicle being driven without a valid driving licence. Learned counsel for the insured contended that it is enough if he establishes that he made all due enquiries and believed bona fide that the driver employed by him had a valid driving licence, in which case there was no breach of the policy condition. As we have not decided on that contention it is open to the insured to raise it before the Claims Tribunal. In the present case, if the Insurance Company succeeds in establishing that there was breach of the policy condition, the Claims Tribunal shall direct the insured to pay that amount to the insurer. In default the insurer shall be allowed to recover that amount (which the insurer is directed to pay to the claimant-third parties) from the insured person.”

76.The submissions made on behalf of the petitioner may now be noticed. According to the learned counsel, sub-section (4) of Section 149 deals with the situation where the insurer in the policy purports to restrict the insurance of the persons insured thereby by reference to any condition other than those in Clause (b) of sub-section (2) of Section 149 and in that view of the matter no liability is covered for driving of a vehicle without licence or fake licence. The submission ignores the plain and unequivocal expression used in sub-section (2) of Section 149 as well as the proviso appended thereto. With a view to construe a statute the scheme of the Act has to be taken into consideration. For the said purpose the entire Act has to be read as a whole and then chapter by chapter, section by section and word by word. (See Reserve Bank of India etc. vs. Peerless General Finance and Investment Co. Ltd. and others (1987) 1 SCC 424 Para 33).

77.Proviso appended to sub-section (4) of Section 149 is referable only to sub-section (2) of Section 149 of the Act. It is an independent provision and must be read in the context of Section 96(4) of the Motor Vehicles Act, 1939. Furthermore, it is one thing to say that the insurer will be entitled to avoid its liability owing to breach of terms of a contract of insurance but it is another thing to say that the vehicle is not insured at all. If the submission of the learned counsel for the petitioner is accepted, the same would render the proviso to sub-section (4) as well as sub-section (5) of Section 149 of the Act otiose, nor any effective meaning can be attributed to the liability clause of the insurance company contained in sub-section (1). The decision in Kamla’s case (supra) has to be read in the aforementioned context.

78. Sub-section (5) of Section 149 which imposes a liability on the insurer must also be given its full effect. The insurance company may not be liable to satisfy the decree and, therefore, its liability may be zero but it does mean that it did not have initial liability at all. Thus, if the insurance company is made liable to pay any amount, it can recover the entire amount paid to the third party on behalf of the assured. If this interpretation is not given to the beneficent provisions of the Act having regard to its purport and object, we fail to see a situation where beneficent provisions can be given effect to. Sub-section (7) of Section 149 of the Act, to which pointed attention of the Court has been drawn by the learned counsel for the petitioner, which is in negative language may now be noticed. The said provision must be read with sub-section (1) thereof. The right to avoid liability in terms of sub-section (2) of Section 149 is restricted as has been discussed hereinbefore. It is one thing to say that the insurance companies are entitled to raise a defence but it is another thing to say that despite the fact that its defence has been accepted having regard to the facts and circumstances of the case, the Tribunal has power to direct them to satisfy the decree at the first instance and then direct recovery of the same from the owner. These two matters stand apart and require contextual reading.

WHEN ADMITTEDLY NO LICENCE WAS OBTAINED BY A DRIVER :

79.We have analysed the relevant provisions of the said Act in terms whereof a motor vehicle must be driven by a person having a driving licence. The owner of a motor vehicle in terms of Section 5 of the Act has a responsibility to see that no vehicle is driven except by a person who does not satisfy the provisions of Section 3 or 4 of the Act. In a case, therefore, where the driver of the vehicle admittedly did not hold any licence and the same was allowed consciously to be driven by the owner of the vehicle by such person, the insurer is entitled to succeed in its defence and avoid liability. The matter, however, may be different where a disputed question of fact arises as to whether the driver had a valid licence or where the owner of the vehicle committed a breach of the terms of the contract of insurance as also the provisions of the Act by consciously allowing any person to drive a vehicle who did not have a valid driving licence. In a given case, the driver of the vehicle may not have any hand at all, e.g. a case where an accident takes place owing to a mechanical fault or vis major. [See Jitendra Kumar (supra)]

80. In V. Mepherson vs. Shiv Charan Singh (1998 ACJ 601 (Delhi) the owner of the vehicle was held not to be guilty of violating the condition of policy by wilfully permitting his son to drive the car who had no driving licence at the time of accident. In that case, it was held that the owner and insurer both were jointly and severally liable.

81. In New India Assurance Co. Ltd. vs. Jagtar Singh and others (1988 ACJ 1074), Hon’ble M. Srinivasan, C.J. as His Lordship then was, dealing with the case where a duly licensed driver was driving a vehicle but there was a dispute as to who was driving the vehicle. In that case the Court referred to the judgment in Kashiram Yadav vs. Oriental Fire and General Insurance Co. Ltd. (1989 ACJ 1078 (SC) and expressed its agreement with the views taken therein.

82. In National Insurance Co. Ltd. vs. Ishroo Devi and others (1999 ACJ 615) where there was no evidence that the society which employed the driver was having knowledge that the driver was not holding a valid licence, it was held the insurance company is liable. The Court relied upon the decisions of this Court in Kashiram Yadav’s case (supra), Skandia’s case (supra) and Sohan Lal Passi’s case (supra). WHEN THE PERSON HAS BEEN GRANTED LICENCE FOR ONE TYPE OF VEHICLE BUT AT THE RELEVANT TIME HE WAS DRIVING ANOTHER TYPE OF VEHICLE :

83. Section 10 of the Act provides for forms and contents of licences to drive. The licence has to be granted in the prescribed form. Thus, a licence to drive a light motor vehicle would entitle the holder there to drive the vehicle falling within that class or description.

84. Section 3 of the Act casts an obligation on a driver to hold an effective driving licence for the type of vehicle which he intends to drive. Section 10 of the Act enables Central Government to prescribe forms of driving licences for various categories of vehicles mentioned in sub-section (2) of said section. The various types of vehicles described for which a driver may obtain a licence for one or more of them are: (a) Motorcycle without gear, (b) motorcycle with gear, (c) invalid carriage, (d) light motor vehicle, (e) transport vehicle, (f) road roller, and (g) motor vehicle of other specified description. The definition clause in Section 2 of the Act defines various categories of vehicles which are covered in broad types mentioned in sub-section (2) of Section 10. They are ‘goods carriage’, ‘heavy-goods vehicle’, ‘heavy passenger motor-vehicle’, ‘invalid carriage’, ‘light motor-vehicle’, ‘maxi-cab’, ‘medium goods vehicle’, ‘medium passenger motor-vehicle’, ‘motor-cab’, ‘motorcycle’, ‘omnibus’, ‘private service vehicle’, ‘semi-trailer’, ‘tourist vehicle’, ‘tractor’, ‘trailer’, and ‘transport vehicle’. In claims for compensation for accidents, various kinds of breaches with regard to the conditions of driving licences arise for consideration before the Tribunal. A person possessing a driving licence for ‘motorcycle without gear’, for which he has no licence. Cases may also arise where a holder of driving licence for ‘light motor vehicle’ is found to be driving a ‘maxi-cab’, ‘motor-cab’ or ‘omnibus’ for which he has no licence. In each case on evidence led before the Tribunal, a decision has to be taken whether the fact of the driver possessing licence for one type of vehicle but found driving another type of vehicle, was the main or contributory cause of accident. If on facts, it is found that accident was caused solely because of some other unforeseen or intervening causes like mechanical failures and similar other causes having no nexus with driver not possessing requisite type of licence, the insurer will not be allowed to avoid its liability merely for technical breach of conditions concerning driving licence.

85. We have construed and determined the scope of sub-clause (ii) of sub-section (2) of Section 149 of the Act. Minor breaches of licence conditions, such as want of medical fitness certificate, requirement about age of the driver and the like not found to have been the direct cause of the accident, would be treated as minor breaches of inconsequential deviation in the matter of use of vehicles. Such minor and inconsequential deviations with regard to licensing conditions would not constitute sufficient ground to deny the benefit of coverage of insurance to the third parties.

86. On all pleas of breach of licensing conditions taken by the insurer, it would be open to the Tribunal to adjudicate the claim and decide inter se liability of insurer and insured; although where such adjudication is likely to entail undue delay in decision of the claim of the victim, the Tribunal in its discretion may relegate the insurer to seek its remedy of reimbursement from the insured in the Civil Court.

WHERE THE DRIVER’S LICENCE IS FOUND TO BE FAKE :

87. It may be true as has been contended on behalf of the petitioner that a fake or forged licence is as good as no licence but the question herein, as noticed hereinbefore, is whether the insurer must prove that the owner was guilty of the wilful breach of the conditions of the insurance policy or the contract of insurance. In Lehru’s case (supra) the matter has been considered at some details. We are in general agreement with the approach of the Bench but we intend to point out that the observations made therein must be understood to have been made in the light of the requirements of law in terms whereof the insurer is to establish wilful breach on the part of the insured and not for the purpose of its disentitlement from raising any defence or the owners be absolved from any liability whatsoever. We would be dealing in some details with this aspect of the matter a little later.

LEARNER’S LICENCE :

88. Motor Vehicles Act, 1988 provides for grant of learner’s licence. (See Section 4(3), Section 7(2), Section 10(3) and Section 14). A learner’s licence is, thus, also a licence within the meaning of the provisions of the said Act. It cannot, therefore, be said that a vehicle when being driven by a learner subject to the conditions mentioned in the licence, he would not be a person who is not duly licensed resulting in conferring a right on the insurer to avoid the claim of the third party. It cannot be said that a person holding a learner’s licence is not entitled to drive the vehicle. Even if there exists a condition in the contract of insurance that the vehicle cannot be driven by a person holding a learner’s licence, the same would run counter to the provisions of Section 149(2) of the said Act.

89. The provisions contained in the said Act provide also for grant of driving licence which is otherwise a learner’s licence. Sections 3(2) and 6 of the Act provides for the restriction in the matter of grant of driving licence, Section 7 deals with such restrictions on granting of learner’s licence. Section 8 and 9 provide for the manner and conditions for grant of driving licence. Section 15 provides for renewal of driving licence. Learner’s licences are granted under the rules framed by the Central Government or the State Governments in exercise of their rule-making power. Conditions are attached to the learner’s licences granted in terms of the statute. A person holding learner’s licence would, thus, also come within the purview of “duly licensed” as such a licence is also granted in terms of the provisions of the Act and the rules framed thereunder. It is now a well-settled principle of law that rules validly framed become part of the statute. Such rules are, therefore, required to be read as a part of main enactment. It is also well-settled principle of law that for the interpretation of statute an attempt must be made to give effect to all provisions under the rule. No provision should be considered as surplusage.

90. Mandar Madhav Tambe’s case (supra), whereupon the learned counsel placed reliance, has no application to the fact of the matter. There existed an exclusion clause in the insurance policy wherein it was made clear that the Insurance Company, in the event of an accident, would be liable only if the vehicle was being driven by a person holding a valid driving licence or a permanent driving licence “other than a learner’s licence”. The question as to whether such a clause would be valid or not did not arise for consideration before the Bench in the said case. The said decision was rendered in the peculiar fact-situation obtaining therein. Therein it was stated that “a driving licence” as defined in the Act is different from a learner’s licence issued under Rule 16 of the Motor Vehicles Rules, 1939 having regard to the factual matrix involved therein.

91. The question which arises for consideration in these petitions did not arise there. Neither the same were argued at the Bar nor the binding precedents were considered. Mandar Madhav Tambe’s case (supra), therefore, has no application to the facts of these cases nor create any binding precedent. The view we have taken is in tune with the judgments rendered by different High Courts consistently. (See for example New India Assurance Co. Ltd. vs. Latha Jayaraj and others (1991 ACJ 298).

CONFLICT OF DECISIONS :

92.Contention of Mr. Salve that there exists a conflict in the decisions of this Court in Nicolletta Rohtagi (supra) on the one hand and Kamla (supra) and Lehru (supra) on the other cannot be accepted. We do not find in the said decisions any such conflict.

93. Nicolletta Rohtagi (supra) was a case where a question arose as to whether an appeal by the insurer on the ground dehors those contained in Section 149(2) would be maintainable. It was held not to be. There cannot be any doubt or dispute that defences enumerated in Section 149(2) would be available to the insurance companies, but that does not and cannot mean that despite such defences having not been established, they would not be liable to fulfil their statutory obligation under sub-section (1) of Section 149 of the Act.

94.So far as the purported conflict in the judgments of Kamla (supra) and Lehru (surpa) is concerned, we may wish to point out that the defence to the effect that the licence held by the person driving the vehicle was a fake one, would be available to the insurance companies, but whether despite the same, the plea of default on the part of the owner has been established or not would be a question which will have to be determined in each case.

95. The Court, however, in Lehru (supra) must not read that an owner of a vehicle can under no circumstances has any duty to make any enquiry in this respect. The same, however, would again be a question which would arise for consideration in each individual case.

96. The submission of Mr. Salve that in Lehru’s case (supra), this Court has, for all intent and purport, taken away the right of insurer to raise a defence that the licence is fake does not appear to be correct. Such defence can certainly be raised but it will be for the insurer to prove that the insured did not take adequate care and caution to verify the genuineness or otherwise of the licence held by the driver.

97. Our attention has also been drawn on an unreported order of this Court in Malla Prakasarao vs. Malla Janaki and others. (Civil Appeal No. 163 of 1996 disposed of on 6th August, 2002) which reads as under :

“It is not disputed that the driving licence of the driver of the vehicle had expired on 20th November, 1982 and the driver did not apply for renewal within 30 days of the expiry of the said licence, as required under Section 11 of the Motor Vehicles Act, 1939. It is also not disputed that the driver of the vehicle did not have driving licence when the accident took place. According to the terms of contract, the Insurance Company has no liability to pay any compensation where an accident takes places by a vehicle driven by a driver without driving licence. In that view of the matter, we do not find any merit in the appeal.

The appeal fails and is, accordingly dismissed. There shall be no order as to costs.”

98. In that case, the Court presumably as in the case of Mandar Madhav Tambe’s case (supra) was concerned with the terms and conditions of the contract of insurance. Before the Court, no occasion arose to consider the general terms and conditions of the contract of insurance vis-a-vis liability of insurance under the Motor Vehicles Act.

CONCLUSION :

99. It is, therefore, evident from the discussions made hereinbefore that the liability of the insurance company to satisfy the decree at the first instance and to recover the awarded amount from the owner or driver thereof has been holding the field for a long time.

100. Apart from the reasons stated hereinbefore the doctrine of stare decisis persuades us not to deviate from the said principle.

101. It is well-settled rule of law and should not ordinarily be deviated from. (See The Bengal Immunity Company Limited vs. The State of Bihar and others, (1955) 2 SCR 603 at 630-632; Keshav Mills Co. Ltd. vs. Commissioner of Income-tax, Bombay North, (1965) 2 SCR 908 at 921-922; Union of India and another vs. Reghubir Singh (Dead) by L.Rs. etc., (1989) 3 SCR 316 at 323, 327, 334; M/s. Gannon Dunkerle and Co. and others vs. State of Rajasthan and others, (1993) 1 SCC 364; Belgaum Gardeners Co-operative Production Supply and Sale Society Ltd. vs. State of Karnataka, (1993) 1 Suppl. SCC 96 ; Hanumantappa Krishnappa Mantur and others vs. State of Karnataka (1992) 2 Suppl. SCC 213).

102. 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 realise the awarded amount from the owner or driver and 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 had 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 opportunity to defend at all. Such a course of action may also be resorted 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.

103. Although, as noticed hereinbefore, there are certain special leave petitions wherein the persons having the vehicles at the time when the accidents took place did not hold any licence at all, in the facts and circumstances of the case, we do not intend to set aside the said awards. Such awards may also be satisfied by the petitioners herein subject to their right to recover the same from the owners of the vehicles in the manner laid down therein. But this order may not be considered as a precedent.

104. Although in most of the cases, we have not issued notices in view of the fact that the question of law has to be determined; we have heard counsel for the parties at length at this stage.

SUMMARY OF FINDINGS :

105. 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 163-A 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 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 wherefore 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 circumstances 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.

(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) If a vehicle at the time of accident was driven by a person having a learner’s licence, the insurance companies would be liable to satisfy the decree.

(ix) The claims tribunal constituted under Section 165 read with Section 168 is empowered to adjudicate all claims in respect of the accidents involving death or of bodily injury or damage to property of third party arising in use of motor vehicle. The said power of the tribunal is not restricted to decide the claims inter se between claimant or claimants on one side and insured, insurer and driver on the other. In the course of adjudicating the claim for compensation and to decide the availability of defence or defences to the insurer, the Tribunal has necessarily the power and jurisdiction to decide disputes inter se between insurer and the insured. The decision rendered on the claims and disputes inter se between the insurer and insured in the course of adjudication of claim for compensation by the claimants and the award made thereon is enforceable and executable in the same manner as provided in Section 174 of the Act for enforcement and execution of the award in favour of the claimants.

(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 Sections 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 as 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 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.

106. For the reasons aforementioned, these petitions are dismissed but without any order as to costs.

Susme Builders Pvt. Ltd. Vs. Chief Executive Officer, Slum Rehabilitation Authority and Ors.[SC 2018 JANUARY]

KEYWORDS:-Slum-Compensation-Article 142 of the Constitution-

Capture

DATE:-January 04, 2018-

  • When a slum, owned by any authority or person, is handed over to the developer, in addition to rehabilitating the slum dwellers, the developer also has to compensate the owner.
  • This is a case where the earlier Bench of this Court had invoked its power under Article 142 of the Constitution of India and we also feel that it is a fit case for invocation of this Court’s jurisdiction under Article 142 of the Constitution of India.

ACTS:-Development Control Regulations for Greater Bombay, 1991 under the Maharashtra Regional & Town Planning Act, 1966 -Section 13 of the Slum Act

SUPREME COURT OF INDIA

Susme Builders Pvt. Ltd. Vs. Chief Executive Officer, Slum Rehabilitation Authority and Ors.

[Civil Appeal No(S). 18121 of 2017]

Deepak Gupta, J.

1. A dream turned into a nightmare. The dream of over 800 slum dwellers who also happen to be owners of the land of having a permanent roof over their head has not turned into reality for more than three decades. The slum dwellers are embroiled in various litigations. There are many powerful persons involved, be they builders, promoters and even those slum dwellers who have managed to become office bearers of the society of slum dwellers. Learned senior counsel appearing for the parties produced before us graphic photographs showing the sordid conditions in which these slum dwellers continue to reside despite having entered into an agreement with the appellant more than 30 years back to develop the slums and rehabilitate the slum dwellers in proper accommodation.

THE FACTUAL BACKGROUND:

2. This case has a long and chequered history and has some features which are unique to it. The land in question measuring 23018.50 square meters is situated in the heart of Mumbai i.e. Santacruz (East), Mumbai. This land earlier belonged to the Ardeshir Cursetji Pestonji Wadia Trust, hereinafter referred to as ‘the Trust’. A slum had developed 3 over the said land. The slum dwellers formed an Association known as ‘the Shivaji Nagar Residents’ Association. It appears that the Trust had initiated some litigation for eviction of the slum dwellers. On 19.03.1980 a consent decree appears to have been passed in this litigation whereby the Trust agreed to transfer the entire land to the slum dwellers in case the slum dwellers formed a society.

The slum dwellers thereafter constituted a society in the name and style of Om Namo Sujlam Suflam Co-operative Housing Society, Respondent No. 3 herein (hereinafter referred to as ‘the Society’). About 800 slum dwellers formed the Society, which was registered under the Maharashtra Co-operative Societies Act, 1960. In furtherance to the decree, the Trust executed a deed of transfer in favour of the Society (Respondent No. 3 herein), transferring the entire land to the Society on 20.02.1985. Thus, this is a unique case where the slum is owned by the Society of which the slum dwellers themselves are the members. The slum dwellers are, therefore, also the owners of the land in question.

3. It would be pertinent to mention that the land in question was declared to be a slum under Section 4 of the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 (hereinafter referred to as ‘the Slum Act’) firstly on 16.08.1977 and again on 07.12.1983.

4. On 15.09.1985, a General Body Meeting of the Society was held and in this meeting it was decided to appoint M/s. Susme Builders Private Limited, hereinafter referred to as ‘Susme’ (the appellant herein), to develop the property. Thereafter, a development agreement was entered into between the Society and Susme on 27.02.1986. It was agreed that there were about 800 occupants on the land in question and each one of the slum dwellers would be provided accommodation measuring 240 sq. ft. built up area with carpet area of 190 sq. ft.

The agreement also contained a condition that the slum dwellers could purchase additional area of 60 or 110 sq. ft. by paying for the extra area at the rate of Rs. 350 per sq. ft.. The project was to be completed within a period of 5 years. Consequent to the agreement, the Society executed a power of attorney in favour of the nominee of Susme on 07.04.1986 virtually empowering it to act on behalf of the Society.

5. Admittedly, no work was done as per the terms of the agreement and nothing was constructed during this period. The stand of Susme is that during the period some public interest litigations were filed, hence the plot of land was not developed.

6. Thereafter, the Development Control Regulations for Greater Bombay, 1991 under the Maharashtra Regional & Town Planning Act, 1966 (for short ‘DCR’) were enforced. As per these DCRs, each one of the slum dwellers was entitled to a tenement of 180 sq. ft. free of cost. Therefore, the general body of the Society met on 30.10.1994 and passed a resolution that the earlier agreement be modified and a tenement of 225 sq. ft. carpet area be given to each slum dweller.

Thereafter, letter of intent in terms of the DCR was issued in favour of the Society and Susme on 05.04.1995. As per this letter of intent, each slum dweller was to be alloted 225 sq. ft. area. Susme was also to comply with the guidelines laid down for redevelopment of notified slums. It was made clear that first the existing slum dwellers were to be rehabilitated and only thereafter, free sale could be done in the open market. Susme was specifically directed to carry out the activities as per the activity chart and in terms of Regulation No. 33(10) of the DCR within five years from the date of issue of the commencement certificate. Thereafter, another agreement was entered between the Society and Susme on 10.07.1995 and in terms of this agreement each slum dweller was entitled for a tenement of 225 sq. ft.; 180 sq. ft. free of cost and 45 sq. ft. at the cost of Rs. 14,350/-.

7. In terms of the letter of intent dated 05.04.1995 and the agreement, Susme was to construct 12 buildings of ground plus seven floors for re-housing the slum dwellers and project affected persons on about 11,000 sq. mtrs. of land and remaining 12,497 sq. mtrs. was to be developed for the 7 purpose of free sale. During the pendency of this agreement, Susme constructed two buildings in which 128 slum dwellers were rehabilitated. This was the only progress which took place.

8. The DCR was amended in 1997. Under the new DCR, each slum dweller was entitled to a flat having carpet area of 225 sq. ft.. Naturally, the slum dwellers wanted, that as per the amended DCR, which was more beneficial to them, they should be granted a larger flat having carpet area of 225 sq. ft.. Therefore, another meeting of general body was held on 10.08.1997. In this meeting it was resolved that fresh negotiations be held with Susme and that Susme should carry out further development under the amended Regulation 33(10) and that 70% residents should consent for the redevelopment. Thereafter, another supplementary agreement was entered into between the Society and Susme on 07.01.1998.

In this agreement, it was stated that there are 867 occupants, out of which 825 are occupying residential premises, are occupying shops and 15 are occupying industrial units. This agreement also provided that tenements to be provided to each of the residential occupants would have a carpet area of 225 sq. ft.. Relevant portion of the agreement reads as follows: “The parties are aware that under the Slum Redevelopment Scheme and the Development Control Regulations each slum dweller is entitled to, a tenement admeasuring 225 sq. ft. carpet area. As regards 27 shops, the shops members shall be entitled to get such area as they are entitled under Sec. 23(10) of D.C. Regulations 1991 amended from time to time.

As regards 15 Industrial Units it is agreed that the Developer shall negotiate with them directly for developing the area occupied by them and the society agrees to sign and execute such papers and writings required by the Developer for that purpose.” Clause 26 of this agreement provided that the plans shall be submitted by the developer to the Slum Redevelopment Authority (for short ‘the SRA’) according to Regulation 33(10) of DCR, 1991 as amended from time to time. This agreement was treated to be a supplementary agreement to the earlier agreement.

9. Susme, on behalf of the Society, also moved the SRA for permission to convert the old SRD Scheme into a new slum rehabilitation scheme. The SRA granted letter of intent on 27.01.1998 and approval was granted for conversion of the scheme. Clause 19 of the letter of intent provided that Susme would submit the agreements with photographs of wife and husband in respect of all the eligible slum dwellers before issue of commencement certificate for sale building, or three months as agreed by the developer, whichever is earlier.

10. One writ petition was filed by the Shivaji Nagar Residents’ Association being Writ Petition No. 1301 of 1999 challenging the sanction by the SRA in favour of Susme on the ground that Susme had not obtained consent of 70% of the slum dwellers. The said writ petition was dismissed on 13.12.1999. The relevant portion of the Judgment reads as follows:- “We have heard learned counsel appearing for the parties. We do not find any substance in the contentions raised by the petitioners. It is required to be noted that some 109 slum dwellers filed Writ Petition No. 497 of 1997 raising identical challenge to the scheme and the said petition came to be withdrawn unconditionally on 10th July, 1997. Thereafter, as indicated earlier, two new buildings were constructed and the eligible slum dwellers were put in possession of their respective tenements.

Under the 1997 scheme the builder is required to enter into agreement with individual members and accordingly 582 agreements have already been signed between the parties. There is 10 also no merit in the contention of the petitioners that consent of 70% of the Slum dwellers was required under the 1991 scheme. On perusal of the said scheme it is clearly seen that consent of 70% of the slum dwellers was not required and what was contemplated was that if 70% of the Slum dwellers join the society, which is interested in the rehabilitation of the slum dwellers, then such society would be eligible to apply for sanction of the same under DCR 33(10).

It is not disputed before us that practically all the slum dwellers have been enrolled as members of the society and, therefore, it is not possible to hold that the requirement of 1991 scheme was not complied with. It is also pertinent to note that the proceedings of the general body meeting dated 13th October, 1994 were not challenged by the petitioners or any other slum dwellers by adopting appropriate remedy. Indeed, the general body meeting had unanimously, resolved to modify the agreement in terms of the 1991 scheme and it is too late to challenge the resolution for the first time by way of the present petition which was filed in 1999.

As regards the, 1997 scheme there is a Specific provision for conversion, of the old scheme into a new scheme and accordingly the proposal for conversion was accepted by the authorities and in pursuance of the acceptance, two new buildings have been constructed at an estimated cost of Rs. 5 crores. In our opinion, this petition suffers from gross delay and laches. It is clearly seen that the petitioners were aware of the sanction granted to the society under the 1991 scheme as well as the 1997 scheme. The construction on the property began in 1996 and two buildings have already been constructed. Under the circumstances, we do not find any reason to interfere in writ jurisdiction under Article 226 of the Constitution.”

11. After Susme had completed 80% construction of the two rehabilitation buildings, it applied for grant of Transfer of Development Rights (for short ‘TDR’) in terms of the amended DCR and sold the same. Occupation certificate in respect of these two buildings was issued on 03.11.1998. While granting permission it was observed on the file as follows:-

“Further, as per policy & DCR 33(10) it is necessary that agreements with more than 70% slum dwellers as per new scheme is required. This was pointed out to CEO (SRA) during discussion, when CEO (SRA) instructed to submit agreements with 70% slum dwellers before second phase of T.D.R. Developers have informed that out of 869 slum dwellers, they have submitted 450 agreements to the office of S.R.A. (52%).”

12. On 07.07.1999, the architects of Susme, on instructions of Susme, submitted 12 files containing 580 numbers of individual agreements with members of the Society and undertook to file the remaining individual agreements to make up 70% in due course of time. On 18.01.2000, Susme was again asked to furnish 70% individual agreements of eligible slum dwellers. Susme replied that in terms of judgment of the Bombay High Court dated 13.12.1999, it was not required to file 70% individual agreements. Under the 1997 amended DCR, the developer was entitled to a higher Floor Space Index (for short ‘the FSI’).

Therefore, Susme submitted fresh plans for construction of 14 storey buildings plus ground floor as against the earlier plan submitted for seven storey buildings plus ground floor buildings. These plans were submitted sometime in the year 1998. However, it appears that the plans were not sanctioned and Susme also did not pursue the matter earnestly with the authorities.

13. Thereafter, on 13.02.2001, SRA informed Susme that the request of Susme for approving amended plans for slum rehabilitation scheme was not considered since the plot under reference was affected by the Coastal Regulation Zone Notification (for short ‘the CRZ Notification’). Then Susme along with the Society filed Writ Petition No. 2269 of 2001 in which the main prayer was for setting aside the CRZ objection and it was also prayed that the petitioner be permitted to complete the rehabilitation scheme. In this petition, an interim order was passed on 07.08.2002.

14. The Government of Maharashtra during this period also appointed a one man Commission headed by Shri Chandrashekhar Prabhu to enquire into the complaints made with regard to the Society and the manner in which the rehabilitation scheme was implemented. Susme and the Society jointly filed Writ Petition No. 1854 of 2004 against this Commission. It was alleged that the SRA had handed over all the files to Shri Chandrashekhar Prabhu. However, an order was passed on 01.03.2005 in the aforesaid writ petition in which a statement was made on behalf of the SRA that all the concerned files had been retrieved from Shri Prabhu and, therefore, the decision on the plans would be taken within four weeks. The Petition was accordingly disposed of.

15. In 2005 itself it was clarified by the authorities that the property in question does not fall in CRZ, Part I and only a portion of the property falls in the CRZ, Part II. The architects of Susme applied for approval of construction of transit accommodation and this approval was granted by the SRA on 18.08.2005. This was, however, subject to the condition that agreements with individual slum dwellers would be executed before demolition of existing structure on the site. Again complaints were made by some people that transit camps were not constructed as per the approved plans and the SRA issued stop work notice on 14.03.2006.

16. Another supplementary agreement was entered into between Susme and the Society on 05.09.2006. This agreement had a clause that the developer i.e. Susme was to deal only with the Managing Committee of the Society. This agreement also provided that any of the Directors of Susme would be treated to be the attorneys of the Society. This agreement also provided that Susme had offered to pay a sum of Rs.75,000/- to each member of the Society having a structure not exceeding 17.00 sq. mtrs. and Rs.1,00,000/- to each of those members whose structure is of more than 17.00 sq. mtrs.. It is, however, not clear whether this amount was actually paid or not. An extraordinary general body meeting of the Society was held on 22.02.2009.

In this meeting it was pointed out that the members of the Society were not taken into confidence by the Managing Committee while issuing power of attorney in favour of the developer and changes to the detriment of the members have been made by the Managing Committee in collusion with Susme. It was also pointed out that agreements were entered into by the Managing Committee with Susme behind the back of the members of the Society. The majority of the members demanded for cancellation of the agreement made with Susme. It would not be out of place to mention that the old Managing Committee had been voted out and a new Managing Committee had taken over during this period.

Thereafter, another general body meeting was held on 29.03.2009 and the minutes of the meeting dated 22.02.2009 were approved. In this meeting it was also pointed out that now Susme had offered to make new plans giving each slum dweller a tenement of 269 sq. ft. carpet in terms of the new circular. But, the benefit of such bigger tenements was not made available to those who were already housed in the rehabilitation buildings. In effect, in this meeting it was decided to terminate the agreement with Susme.

17. Susme, thereafter, invoked the arbitration clause in the agreement and filed a petition for grant of interim relief under Section 9 of the Arbitration and Conciliation Act, 1996 on 29.10.2009. The said arbitration petition was withdrawn on 16 26.06.2012 with liberty to Susme to file a suit. However, the Society was restrained from implementing the Resolution terminating the agreement till 13.07.2012. Civil suit No. 1588 of 2012 was filed by Susme on 10.07.2012 in the High Court of Bombay against the Society and M/s. J.G. Developers Private Limited.

18. The Society made a complaint to the SRA on 05.04.2009 that Susme was not developing the project as per the agreement and necessary action be taken by the SRA against Susme. On 15.06.2009, a communication was sent to the Society on behalf of SRA that since Susme had constructed two buildings and is in the process of construction of transit camp, the developer Susme should be allowed to continue and the request for change of developer was virtually rejected.

There is some dispute as to whether this letter was signed by the Chief Executive Officer or the Executive Engineer but that is not very material for the decision of the case. On 24.07.2009, the Society terminated the agreement with Susme by a written notice. The Society made another complaint to the SRA and on 08.09.2009, the SRA issued notice to Susme in terms of Section 13(2) of the Slum Act, but it appears, that no action was taken pursuant to this notice.

19. Thereafter, on 14.09.2009, the Society entered into an agreement with M/s J.G. Developers Private Limited, respondent no.4 (hereinafter referred to as ‘J.G. Developers’). In this agreement J.G. Developers agreed to provide permanent alternative accommodation measuring 269 sq. ft. carpet area to each of the eligible members having residential premises. Sufficient alternative accommodation was also to be provided to those occupying commercial/industrial premises. In Clause (4) of the agreement, it was mentioned that since the Society was the owner of the plot, the developer would also grant it 72,000/- sq. ft. carpet area free of cost for use by the members of the Society.

This was crystallized in the supplementary agreement entered on 22.09.2009 between the Society and J.G. Developers. In terms of this supplementary agreement, 155 members occupying double residential premises would be entitled to additional area of 18 150 sq. ft. and 614 members having single residential premises would be entitled to 75 sq. ft. additional area. This effectively meant that those having single residential area would get a tenement of 344 sq. ft. and those having double residential area would get a tenement of 419 sq. ft.. J.G. Developers took the responsibility of getting permission for giving this extra area. Thereafter, J.G. Developers entered into individual agreements with some of the members of the Society in terms of the agreement and supplementary agreement as referred to above.

20. Complaint No. 30 was filed on 21.09.2006 before the Anti-Corruption Bureau, which was referred to the High Power Committee (for short ‘the HPC’), in which it was complained that the names of the occupants at Serial No. 774 to Serial No. 852 of the list of occupants issued on 21.06.1993 by the Additional Collector, Encroachment, are bogus and are based on fabricated documents. Notice was issued on this complaint. On 04.06.2011, Susme again wrote to the SRA to process the proposal submitted to SRA on 01.10.2008. Similar request was made on 16.07.2011 also.

21. Thereafter, on 11.08.2011, show cause notice under Section 13(2) of the Slum Act was issued by the SRA to Susme as to why the SRA should not determine the right granted to Susme to develop the land and entrust the work of rehabilitation of the slum of the Society to some other agency. The reasons for issuing the notice are contained in Annexure- A, which reads as follows:

“1) The LOI for conversion of SRA scheme was issued u/No.SRA/ChE/110/HE/PL/LOI dt. 27/01/1998. It is reported by the Secretary that the developer has failed and neglected to complete the work of Rehab building within the stipulated period as per LOI condition and committed the breach of the terms and conditions of the sanctioned S.R. Scheme.

2) As per complaint of Society, the Developer have not taken effective steps for speedy implementation of Scheme and shown wilful negligence.” Susme replied to the notice. Even the Society submitted its reply to the notice and stated that there was inordinate delay in completing the scheme. Written submissions were filed by all sides. Finally, by order dated 24.02.2012, the SRA set aside the appointment of Susme as developer mainly on two grounds:-

(i) that there was unexplained delay in carrying out the work under the rehabilitation scheme and,

(ii) Susme had failed to show that it had filed individual agreements with 70% slum dwellers. The SRA, instead of handing over the work to another agency, held that since the Society had already entered into an agreement with J.G. Developers, it may get the scheme implemented through it. Susme filed an appeal being No. 39 of 2012 before the HPC. This appeal was dismissed on 18.06.2012. This order of the HPC was challenged by filing Writ Petition No. 1718 of 2012, on the ground that one of the Members of the HPC was not entitled to hear the appeal.

This writ petition was allowed on 14.08.2012 and the matter was remanded back to the HPC. Thereafter, the HPC again heard the appeal and dismissed the same on 10.10.2012. Against this order of the HPC, the appellant filed Writ Petition No. 5 of 2013, which was rejected by the Bombay High Court by the impugned order dated 11.06.2014 and it is this order of the High Court which is under challenge in this appeal. In the meantime, on 03.08.2012 the Bombay High Court in the suit filed by Susme, refused to grant any interim relief.

22. Letter of intent dated 29.10.2012 was issued by the SRA in favour of the Society, J.G. Developers and also its architects. In this letter of intent approval was given for FSI of 3.78 for slum portion, 3.18 for slum portion in lieu of 128 tenements with carpet area of 20.90 sq. mtrs., already constructed and 2.58 for slum portion in CRZ-II. Effectively, the FSI for the developer had increased substantially. In this letter of intent it was mentioned that the eligible slum dwellers would be re-housed in residential tenements of carpet area of 25 sq. mtrs. (269 sq.ft.) or 20.90 sq. mtrs. (225 sq.ft.). It is thus apparent that no permission was granted for giving larger tenements to the eligible slum dwellers.

23. In another Special General Meeting of the Society held on 13.07.2014, it was decided by majority vote to cancel the agreement with J.G. Developers. It was also decided that in view of the cancellation of appointment of J.G. Developers, the Managing Committee should select a new and capable developer and the offer made by such developer should be put up before the next general body meeting. The Society terminated the appointment of J.G. Developers on 25.08.2014. J.G. Developers challenged the termination of their agreement by filing Civil Suit No. 756 of 2014 on 19.09.2014 and in this civil suit an interim order was passed on 24.09.2014.

24. After the termination of the agreement with J.G. Developers on 25.08.2014, on 26.08.2014 the Managing Committee of the Respondent No. 3, the Society, entered into consent terms with Susme again appointing Susme as the developer.

25. Susme filed the present petition for special leave to appeal challenging the decision of the High Court of Bombay in Writ Petition No. 5 of 2013, before this Court. The respondents put in appearance even before the notice was issued and on 27.03.2015 this Court has passed the following order:

“Heard Mr. Fali S. Nariman, learned senior counsel for the petitioner, Mr. P.C. Chidambaram, learned senior counsel and Mr. Mihir Joshi, learned counsel for respondent no.4, Mr. Kapil Sibal, learned senior counsel for respondent no.3, Mr. C.U. Singh, learned senior counsel for respondent no.1 and Mr. Raval, learned senior counsel for the applicant in IA No.5/14 along with their assisting counsel.

2. The present case frescoes a labyrinthine chequered history that can flummox the prudence of the wise, for the procrastination in putting an end to a litigation. But, a pregnant one, it is a problem created by human beings by use of adroit proclivity at their best and, therefore, as advised at present, this Court is obliged to take recourse to an innovative method, at least to attempt at a solution.

3. We need not reflect the nature of orders passed in various cases fought between the parties. Suffice it to mention that they have invoked the power of the authorities under the Maharashtra Slum Areas (Development, Clearance and Redevelopment) Act, 1971, instituted civil suits on the original side of the Bombay High Court and sometimes the society, namely, Om Namo Sujlam Sujlam Co-operative Housing Society, respondent no.3 herein, has changed its colour as chameleon with afflux of time may be yielding to the “hydraulic pressures of time” and thereby eventually, in all possibilities, making the slum dwellers of the area, i.e., C.T.S. No.7627, 7627/1 to 852 admeasuring 23018.50 sq. mtrs. situated at village Kolekalyan at Santacruz (East), Mumbai remain in that pathetic condition as they were since 1986, as if the parties have nurtured the notion that they can arrest time. Be that as it may, a solution has to be thought of.

4. In course of hearing Mr. Chidambaram, appearing for respondent no.4, assiduously asserted that he has got the 24 consent from 70% of the eligible slum dwellers and, therefore, the society is absolutely justified in entering into an agreement which is called a “development agreement”. Mr. F.S. Nariman, learned senior counsel, determined not to lag behind, would astutely asseverated that he has the consentum of 70% of eligible slum dwellers and hence, his case cannot be brushed aside. We have been apprised by Mr. Kapil Sibal, learned senior counsel appearing for respondent no.3, that at present there are slightly more than 800 eligible slum dwellers. Mr. Raval, learned senior counsel appearing for the assumed authorised authority of the society, would present that it is the respondent no.3 who has been correctly granted the privilege of development agreement inasmuch as there was a verification with regard to the consent earlier.

5. In our considered opinion, regard being had to the special features of the case which includes the longevity of the case and indefatigable spirit in which the parties are determined to fight, we think there should be appropriate verification of the consent of the eligible slum dwellers in praesenti. Regard being had to the same, we request Mr. Justice B.N. Srikrishna, formerly a Judge of this Court, to verify the factum of consentum of the eligible slum dwellers. The Slum Rehabilitation Authority represented by the Chief Executive Officer either by himself or by any responsible high level officer nominated by him shall assist Mr. Justice B.N. Srikrishna in this regard.

6. As secretarial staff would be required for this purpose, the petitioner and the respondent no.4 shall deposit a sum of Rs.5,00,000/- (Rupees five lacs only) each so that the verification can be expedited. In addition, learned Judge may fix his honorarium which shall be paid proportionately, as agreed to by the petitioner and the respondent no.4.

7. The parties are at liberty to file documents to facilitate the process of verification with regard to consentum in praesenti before the learned Judge. We repeat at the cost of repetition that such a mode has been adopted, regard being had to the special phenomena of the case. As we have taken recourse to such a method any other the litigation pending in any forum in this regard shall remain stayed.

8. Needless to say, the interim order of status quo passed in this special leave petition, except the directions which have been issued hereinabove, shall remain in force.

9. Let this matter be listed on 09.07.2015 awaiting the report from Mr. Justice B.N. Srikrishna.”

26. Thereafter, Justice B.N. Srikrishna, former Judge of this Court carried out the mandate, which he was required to do in terms of the aforesaid order. He decided that voting should be held by secret ballot. He categorized the voters in four categories.

Category “A”

Persons who were original slum dwellers and continue to be occupants as on the cut-off date i.e. 27th March 2015.

Category “B”

Persons who claim to exercise their vote as a result of legal heir ship.

Category “C”

Persons who claim to have become members of the Society by reason of sale and transfer of the shares.

Category “D”

79 persons whose eligibility is under challenge before the Competent Authority as per the directions of the High Power Committee.

He found that there were 867 slum dwellers in the four categories:

Category “A”

263

Category “B”

318

Category “C”

207

Category “D”

79

Total

867

Four separate ballot boxes were kept i.e. one for each category and the result of the voting is tabulated as follows:

Category

Total Eligible Voters

Voter turn-out at the Poll on 22/11/2015

Votes polled by Petitioner

Votes Polled by Respondent No.4

Invalid Votes

“A”

263

191

108

70

13

“B”

318

275

179

84

12

“C”

207

172

126

43

03

“D”

079

013

010

03

Total

867

651

423

200

28

Thereafter, Justice Srikrishna submitted his report setting out the voting pattern but did not make any recommendation.

CONTENTIONS:

27. The main contention raised on behalf of the appellant- Susme by Shri F.S. Nariman, learned senior counsel is that the order dated 27.03.2015 is an order passed by this Court in exercise of its extraordinary jurisdiction either under Article 136 or under Article 142 of the Constitution of India. It is submitted that this order was passed with a view to settle all disputes between the parties. It is urged that this Court cannot go behind this order especially when there is no application filed for recall of the said order. It is also urged that I.A.No. 10 of 2015 filed by J.G. Developers for modification of the order, was rejected. It is contended that since Justice B.N. Srikrishna has found that the majority supports Susme, the appeal should be allowed and Susme be permitted to carry on with the project.

28. The other contentions raised on behalf of the appellant- Susme by Shri Darius Khambata, learned senior counsel are:

(a) that Section 13(2) of the Slum Act is wholly inapplicable;

(b) that the notice under Section 13(2) was given only in respect of delay and not in respect of 70% consent and hence the SRA, the HPC and the High Court fell in error in insisting on 70% consent;

(c) that when migration of the scheme took place from redevelopment scheme to slum rehabilitation scheme, 70% consent was not necessary.

29. On behalf of J.G. Developers it is contended by Shri Gopal Subramanium, learned senior counsel that the intention of this Court was to find out whether any party had support of 70% of the slum dwellers or not. It is also contended that it was not the intention of this Court to bypass the legal provisions and this Court is not bound by the aforesaid order. In the alternative, it is submitted that the exercise carried out by Justice B.N. Srikrishna only shows that as on date there are more people with Susme. It is contended that the Bombay High Court has consistently held that there should be no competitive voting inter se developers because that gives rise to many malpractices with the developers trying to outbid each other by giving sops to the voters.

It is contended that the consistent view till now has been that once the slum dwellers have given consent for one developer or have entered into an agreement with a developer then they cannot be permitted to withdraw the consent, otherwise, it will lead to chaos and no slum rehabilitation scheme would be implemented. It is also contended that the matter should be decided on merits and not on the basis of this order. It is also contended that Susme does not have the support of 70% of the slum dwellers.

30. It is also contended on behalf of J.G. Developers that Susme is guilty of unexplained delay and the slum dwellers are suffering and, therefore, the Society had rightly decided to enter into a fresh agreement with J.G. Developers. It is also urged that Susme had never obtained the consent of 70% of the slum dwellers, which was mandatory. It is also contended that Susme had taken advantage of trading of the development rights by assuring the SRA that it would get 70% consent. It is further urged that Susme never contested the issue of 70% consent earlier.

31. Here, it would be pertinent to mention that the Society has two factions. One faction supports Susme and the other faction supports J.G. Developers. The faction supporting Susme states that it has terminated the agreement with J.G. Developers and cannot be forced to get the development work done through J.G. Developers. The other faction alleges that there is no valid existing agreement with Susme.

32. The following issues arise for decision in this case:

(i) What is the scope, ambit and effect of the order of this Court dated 27.03.2015;

(ii) What is the scope of powers under Section 13(2) of the Slum Act;

(iii) Whether the SRA has any power to remove the developer;

(iv) Whether in the notice issued under Section 13(2) of the Slum Act the issue of 70% consent was raised;

(v) Whether support of 70% of the slum dwellers is mandatory and whether slum dwellers are entitled to withdraw their consent;

(vi) Whether Susme delayed the construction of the Scheme, and is, therefore, not entitled to any relief;

(vii) Whether Susme is entitled to continue with the Scheme;

(viii) In case Susme is not entitled to continue with the scheme whether respondent no. 4 J.G. Developers is entitled to continue with the rehabilitation scheme.

THE SCOPE, AMBIT AND EFFECT OF THE ORDER OF THIS COURT DATED 27.03.2015:

33. Relevant portion of order dated 27.03.2015 has been quoted hereinabove. The main contention of Mr. Nariman, learned senior counsel appearing for the appellant is that this order is an order passed under Article 142 or Article 136 of the Constitution and is binding upon the parties. On the other hand, it was urged by M/s Gopal Subramanium and Neeraj Kishan Kaul, learned senior counsel appearing for the respondents that the order in question is not a binding order. In the alternative, it was submitted that even if the order is binding, this Court can interpret the order and even as per 32 the said order, the appellant is not entitled to continue with the Scheme.

34. At the outset, we may note that judicial propriety and discipline requires that a Coordinate Bench must respect the order of an earlier Bench. In fact, even a larger Bench should not brush aside the order passed by an earlier Bench even if it be a smaller Bench unless the order is in issue before the larger Bench. Suffice to say that the order in question holds the field. It has not been recalled and prayer for modification in I.A. No. 10 was rejected on 13.05.2015. Therefore, the order of this Court dated 27.03.2015 holds the field and we are bound by the same. At the same time, it is our duty to decipher what was the intention of the Bench while passing the order and to find out what the Court intended to do by the said order.

35. In Para 2 of the order, the Division Bench has noted the long and chequered history of the case and has noted that the 33 Court had to take recourse to an innovative method to try and find a solution. It is thus apparent that this is an order falling within the ambit of Article 142 to do complete justice between the parties. The Court was aware that the slum dwellers were suffering due to the long protracted litigation. Therefore, the Court felt the need to find an innovative solution. In Para 3 of the order, the Court has noted the factual aspects and again emphasized the need to find a solution to resolve the various issues. The Court was obviously moved by the pathetic condition in which most of the slum dwellers continued to reside.

36. Para 4 of the order is very important because it notes the contention of learned counsel appearing for J.G. Developers, who had emphatically stated that his client had the consent of 70% of the eligible slum dwellers and, as such, the Society was justified in entering into a development agreement with his client. On the other hand, learned senior counsel appearing for the appellant equally strongly refuted this claim and claimed that his client had the consent of 70% eligible 34 slum dwellers. It is in this context that the directions contained in Para 5 of the order dated 27.03.2015 were passed wherein this Court directed “…….there should be appropriate verification of the consent of the eligible slum dwellers in praesenti.” Justice B.N. Srikrishna was requested to verify the factum of the consent of the eligible slum dwellers.

37. The contention raised on behalf of Susme is that there is no mention of “70%” in the direction given in Para 5 of the order and, therefore, all that Justice B.N. Srikrishna was required to do was to ascertain consent of the slum dwellers in praesenti. It is contended that almost 70%, and at least much more than the majority, have exercised their choice in favour of Susme and, thus, there is no reason why the appeal should not be allowed. Susme should be permitted to carry on the development work in terms of the agreement entered into with the respondent no. 3-Society. It is also urged that as far as respondent no. 4 is concerned, it has got hardly 30% of the votes and, therefore, there is no question of awarding the contract to respondent no. 4.

38. We are not in agreement with this submission. It is settled law that a judicial order or judgment has to be read as a whole and a single line or phrase cannot be read out of context. A judgment is not to be interpreted like a statute. As far as the order dated 27.03.2015 is concerned, the intention of the Court, will have to be deduced from the entire order. We cannot read the phrase “…….there should be appropriate verification of the consent of the eligible slum dwellers in praesenti.” in isolation. This has to be read in the context of the rival contention of the contesting parties that each one of them had the consent of more than 70% of the slum dwellers.

According to us, this Court was not oblivious of the requirements of the Slum Act though it may not have explicitly referred to them. It is obvious from Para 4 of the order dated 27.03.2015 that learned counsel for both the parties claimed that their respective clients had the support of 70% of the slum dwellers. Obviously, both of them could not be correct. This factual dispute could not be decided in these proceedings. This was the dispute which was referred for resolution to Justice B.N. Srikrishna. We may observe that Justice B.N. Srikrishna in the first effective procedural order dated 27.04.2015, rightly understood the order to mean as follows:

“After carefully perusing the Order dated 27th March, 2015 made by the Hon’ble Supreme Court and the submissions made in writing and through Counsel and representatives on behalf of the Petitioners as well as the Respondents, I am of the view that the best way of verifying the factum of consentum of the eligible slum dwellers in praesenti would be to hold a secret ballot under my aegis and after counting the votes, make a report to the Court as to whether more than 70% of the eligible slum dwellers are in favour of the redevelopment agreement being signed with the Petitioner or Respondent No.4.”

39. It is, thus, clear that Justice B.N. Srikrishna had understood that he was to ascertain whether 70% of the eligible slum dwellers are in favour of the redevelopment scheme signed with the appellant-Susme or with respondent no. 4. We are clearly of the view that a holistic reading of the order admits of no other meaning. The only dispute raised before this Court on 27.03.2015 was which of the builders had the support of the 70% of the slum dwellers. Since this factual dispute could not be decided in Court, Justice B.N. Srikrishna was requested to do this job. It is not necessary for us to go into the other arguments raised with regard to the effect of the order because, according to us, this order admits of no other interpretation. Admittedly, neither the appellant nor respondent no. 4 has received 70% support.

40. Further, the words ‘in praesenti’ only mean that the Court wanted the verification of the consent of the eligible slum dwellers as on date of passing of the order. ‘In praesenti’ cannot be read to mean ‘present and voting’. It only means eligible slum dwellers as on 27.03.2015. Justice B.N. Srikrishna has divided the slum dwellers into four categories; 263 were the original slum dwellers, 318 were the legal heirs, 207 were those who had become members by means of sale and transfer of shares and 79 voters were disputed.

We may note that during these entire proceedings not a single complaint has been filed that an ineligible slum dweller was permitted to vote or that an eligible slum dweller was not permitted to vote. The procedure followed by Justice B.N. Srikrishna is absolutely correct and no error can be found in 38 this regard. Therefore, we have no hesitation in accepting the report submitted by Justice B.N. Srikrishna.

41. Out of 867 total eligible voters only 651 voted and the appellant secured 423 votes, which would mean 64.98% or roughly 65% of the votes polled. But, if we were to calculate this percentage from the total number of slum dwellers i.e. 867 then the percentage is 48.78%, which is less than 50%. In case we exclude 79 votes which are doubtful, then the total eligible voters would be 788 and the appellant secured 413 i.e. 52.41% of the total eligible slum dwellers, well below the magic figure of 70%. We are unable to accept the contention of Mr. Nariman that to put an end to all litigation, the Court only wanted to find out who had the majority. That, according to us, is not the essence of the order dated 27.03.2015.

It is true that 70% is not reflected in the direction given in Para 5 of the order but as earlier noted by us, the directions have to be understood in view of the intention of the Court, which was to find out that which of the builders had the support of 70% of the slum dwellers.

Unfortunately, both the developers do not enjoy 70% support, though it is true that the appellant has the support of more than twice the number of slum dwellers as compared to respondent no. 4. Since neither Susme nor J.G. Developers has the support of 70% slum dwellers, the order dated 27.03.2015 cannot be taken to its logical conclusion and we have to decide the appeal on merits.

THE SCOPE OF POWERS UNDER SECTION 13(2) OF THE SLUM ACT:

42. Relevant portion of Section 13 of the Slum Act which is the bone of contention between the parties reads as follows;

“13. (1) Notwithstanding anything contained in subsection (10) of section 12, the Slum Rehabilitation Authority may, after any area is declared as the Slum Rehabilitation Area, if the landholders or occupants of such area do not come forward within a reasonable time, with a scheme for re-development of such land, by order, determine to redevelop such land by entrusting it to any agency for the purpose.

(2) Where on declaration of any area as a Slum Rehabilitation Area the Slum Rehabilitation Authority, is satisfied that the land in the Slum Rehabilitation Area has been or is being developed by the owner in contravention of the plans duly approved, or any restrictions or conditions imposed under sub-section (10) of section 12, or has not been developed within the time, if any, specified under such conditions, it may, by order, determine to develop the land by entrusting it to any agency recognised by it for the purpose: Provided that, before passing such order, the owner shall be given a reasonable opportunity of showing cause why such order should not be passed.”

43. Shri Darius Khambata, learned senior counsel appearing for Susme urged that under Section 13(2) of the Slum Act, the SRA is entitled to take action only against the owner. He also submits that Section 13(2) will apply only when there is violation of the conditions imposed under sub-section 10 of Section 12 of the Slum Act and the condition with regard to the time should also be a condition contained in sub-section 10 of Section 12. He submits that there is no power to take action under this section against the developer. According to him, action could have been taken by the SRA against the Society but not against Susme.

44. We cannot accept such a wide submission. According to us, under Section 13(2) of the Slum Act, the SRA has the authority to take action and hand over the development of land to some other recognized agency under three circumstances:

i. When there is contravention of the plans duly approved;

ii. When there is contravention of any restriction or condition imposed under sub-section 10 of Section 12 of the Slum Act; and

iii. When the development has not taken place within time, if any, specified.

45. The requirement to complete the development within time may be there in the letter of intent issued by the SRA or may be in the agreement entered into between the owner/developer with the slum dwellers. Such condition, if violated, would attract the provisions of Section 13(2) of the Slum Act. Over and above that, when a clearance order is passed, then in terms of sub-section 10 of Section 12, the competent authority can include a condition with regard to the time within which the development should be completed and in that case also Section 13(2) would be attracted. We are not, however, able to accept the very wide argument that 42 in case of delay, the condition that is violated must be laid down under Section 12(10) of the Slum Act.

46. There may be cases where the slum dwellers do not offer any resistance and willingly consent to move into transit accommodation provided by the owner/developer. Therefore, the conditions laid down under Section 12(10) will come into play only when there is a clearance order, but in case there is no clearance order, then under Section 13(2), the SRA would be empowered to take action when there is violation of any plan or when there is violation of any condition relating to developing the project within time. The time limit can, some time, be provided in the letter of intent, in the agreement or even in the regulations.

47. Having held so, we are of the view that Shri Darius Khambata, learned senior counsel, is right in his submission that normally under Section 13(2) of the Slum Act, action by the SRA has to be taken against the owner. Here, we may repeat that this is a unique case where the slum dwellers are the members of the owner-Society. The Society, in turn, has given power of attorney to the builder. The builder virtually has two roles – one as developer and the other as power of attorney holder of the owner. Both are closely interlinked and inextricably mixed with each other. Therefore, though normally we would have accepted the contention that under Section 13(2) action can only be taken against the owner, in the present case, we are unable to accept this contention in its totality.

We may point out that even the SRA, in its order, has itself noted that since the Society is the owner of the plot of land, it is empowered and within its right to terminate the agreement executed with the said developer for breaches committed by the developer. It has, however, held that a private dispute between the Society and the developer cannot prevent the SRA from discharging its obligations. The SRA agreed with the submission made by the Society that Susme had not completed the project within time. It has taken action under Section 13(2) of the Slum Act. The action taken 44 by the SRA is to remove Susme as developer which amounts to cancelling the letter of intent issued in favour of Susme.

48. Otherwise, there would be an anomalous situation where the Society would have terminated its contract with Susme but the letter of intent issued by the SRA would continue to hold the field and it would be entitled to develop the land. The Society approached the SRA, in fact, asking it to take action against Susme. Since the SRA is the authority which issued the letter of intent, it will definitely have the power to cancel the letter of intent.

49. We are of the considered view that in the peculiar facts and circumstances of the case where the slum dwellers are virtually the owners of the land as members of the owner Society, the SRA had the power under Section 13(2) of the Slum Act to issue the order dated 24.02.2012.

WHETHER THE SRA HAS ANY OTHER POWER TO REMOVE THE DEVELOPER:

50. Even if we were to assume that the SRA did not enjoy this power under Section 13(2) of the Slum Act, we are of the considered view that since it was the SRA which issued this letter of intent, it necessarily must have the power to cancel the same. The SRA can also derive this power under clauses (c) and (d) of sub-section (3) of Section 3A of the Slum Act, which read as under:

“3A. (1) Notwithstanding anything contained in the foregoing provision, the State Government may, by notification in the Official Gazette, appoint an authority to be called the Slum Rehabilitation Authority for such area or areas as may be specified in the notification; and different authorities may be appointed for different areas.

xxx xxx xxx

(3) The powers, duties and functions of the Slum Rehabilitation Authority shall be,-

xxx xxx xxx

(c) to get the Slum Rehabilitation Scheme implemented;

(d) to do all such other acts and things as may be necessary for achieving the objects of rehabilitation of slums.”

51. A bare reading of these provisions shows that in terms of clause (c) and (d) of sub-section (3) of Section 3A of the Slum Act, the SRA not only has the power, but it is duty bound to get the slum rehabilitation scheme implemented and to do all such other acts and things as will be necessary for achieving the object of rehabilitation of slums. In this case, the SRA was faced with a situation where the slum dwellers were suffering for more than 25 years and, therefore the action taken by SRA to remove Susme for the unjustified delay was totally justified.

52. A perusal of the various provisions of the Slum Act would show that normally in a case falling under the Slum Act, it is the owner of the land, whether it be the Government, a statutory authority or a private person, who will be interested in the development work. Normally, the occupiers will be encroachers of slum land.

Therefore, there will be a conflict of interest between the occupiers and the owner. The owner, in turn, will always engage a developer/builder to carry out the development work. In case the owner gives a power of attorney to the developer, as in the present case, the developer now has two identities –

(i) the power of attorney holder of the owner and

(ii) the developer. As far as the present case is concerned, the Society is made up of the members who are occupiers and this Society has given power of attorney to the developer-Susme. Therefore, the developer Susme is actually having a dual role of owner and developer. Both the letters of intent have been issued in favour of the Society, Susme and the architects of Susme. Susme could not have carried out the development work on the basis of its agreement with the Society. It needed the permission of the SRA. Therefore, SRA can obviously revoke such permission.

WHETHER IN THE NOTICE ISSUED UNDER SECTION 13(2) THE ISSUE OF 70% CONSENT WAS RAISED:

53. Shri Darius Khambata, learned senior counsel, has raised another contention that there is no allegation in the notice under Section 13(2) of the Slum Act that Susme has violated any provisions of the Act, Regulations or Scheme in not getting consent of 70% of the slum dwellers. We have gone through all the three notices and find that, in fact, in the 48 notices there is no specific allegation in this behalf. On the other hand, Shri Gopal Subramanium, learned senior counsel appearing for J.G. Developers, urges that in the last notice reference has been made to violation of DCR and this will obviously include violation of requirement of consent of 70% slum dwellers.

54. We are unable to accept the contention of Shri Gopal Subramanium, learned senior counsel. When a notice is issued to a party it must be clearly told what are the allegations which it must meet. The notice should be clear and unambiguous.

55. There was no allegation in the notice(s) that the right to develop granted in favour of Susme was liable to be revoked because it had not obtained consent of 70% of the slum dwellers. The reference to Regulation 33(10) also did not specifically raise the issue of 70% consent. Susme was never put to notice by the SRA that its right to develop the land may be cancelled because of not having consent of 70% slum dwellers. It was confined to the issue of delay. We answer this issue accordingly.

56. However, we are of the view that while considering the issue of delay, the SRA was justified in making reference to the various communications made by Susme and its architects seeking time to obtain consent of 70% slum dwellers and, therefore, while dealing with the issue of delay, we shall take into consideration all these matters.

WHETHER SUPPORT OF 70% OF THE SLUM DWELLERS IS MANDATORY AND WHETHER SLUM DWELLERS ARE ENTITLED TO WITHDRAW THEIR CONSENT:

57. It would be important to note that under DCR of 1991, which were initially applicable to this project, a Scheme for rehabilitation could be initiated where more than 70% of the eligible hutment dwellers on the land agreed to the redevelopment scheme by becoming members of a cooperative society. Thereafter, the Scheme was to be considered by the 50 authorities for implementation. Relevant portion of the DCR reads as follows:

“INITIATION OF THE SCHEME:-

Where more than 70% of the eligible hutment dwellers on the land agree to join the redevelopment scheme and become members of the cooperative society, the scheme should be considered for implementation.”

58. Under Development Control Regulations 33(10) of 1991, the essential requirement was that at least 70% of the slum dwellers had to form a society with a view to redevelop the slum area. In case 70% slum dwellers did not join, there could be no rehabilitation scheme. As far as the present case is concerned, it is not disputed that more than 70% slum dwellers had formed the respondent no. 3-Society. It is the admitted case of the parties that 800 out of 867 slum dwellers formed respondent no. 3-Society, which is 92.27%.

59. DCRs of 1991 were amended in 1997.

Clause 1.15 of Appendix (IV) of the amended DCR provided that 70% or more of eligible hutment dwellers in a slum must agree to join a rehabilitation scheme before it can be considered for approval. This clause reads as follows: “Where 70 per cent of more of the eligible hutmentdwellers in a slum or pavement in a viable stretch at one place agree to join a rehabilitation scheme, it may be considered for approval: Provided that nothing contained herein shall apply to Slum Rehabilitation Projects undertaken by the State Government or Public authority or as the case may be a Government Company as defined in section 617 of the Companies Act, 1956 and being owned and controlled by the State Government.”

Clause 1.16 of Appendix (IV) of this DCR reads as follows:

“In respect of those [eligible] hutment-dwellers on site who do not join the Project willingly the following steps shall be taken:-

(i) Provisions for all of them shall be made in the rehabilitation component of the scheme.

(ii) The details of the actual tenement that would be given to them by way of allotment by drawing lots for them on the same basis as for those who have joined the Project will be communicated to them in writing by the Managing Committee of the Co-operative Housing Society. [If it is registered or the developer and in case of dispute decision of the CEO/SRA shall be final and binding on all the parties concerned.

(iii) The transit tenement that would be allotted to them would also be indicated alongwith those who have joined the Project.

(iv) If they do not join the scheme within 15 days after the approval has been given to the Slum Rehabilitation Project on that site, then action under the relevant provisions including sections 33 and 38 of the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971 as amended from time to time, shall be taken and their hutments will be removed, and it shall be ensured that no obstruction is caused to the scheme of the majority of persons who have joined the scheme willingly.”

60. It is thus obvious that under the amended DCR, not only 70% or more of the eligible hutment dwellers must first agree to join a rehabilitation scheme before it is taken up for consideration, but the owner/developer or cooperative society must also enter into individual agreements with each of these eligible hutment dwellers. We may also point out that the amended DCR in clause 1.16 of Appendix IV provides that even in respect of those eligible hutment dwellers who do not join the project willingly, the developer/builder has to make provision for accommodation of these hutment dwellers in the scheme.

They are entitled to the same benefits as the hutment dwellers who actually join the scheme. They are also entitled to similar transit accommodation as is allotted to those who willingly join the scheme. Further, the regulations also provided that if such hutment dwellers do not join the scheme and do not accept the transit accommodation or the completed premises, then they can be removed from their hutments and it will be ensured that these hutment dwellers do not cause any hindrance to the project.

61. Very lengthy arguments were addressed by learned counsel on the issue whether 70% support of the slum dwellers is mandatory. A large number of authorities have also been cited but, in our view, it is not necessary to refer to the various authorities because the bare provisions of law are sufficient to decide this issue. A bare reading of DCR of 1991 makes it absolutely clear that under the said DCR at least 70% of the slum dwellers/occupiers have to get together and form a Society for the purpose of slum re-development scheme.

Therefore, unless 70% slum dwellers agree to form a Society, the provisions of the Slum Act could not be invoked to frame an SRD scheme. Under the amended DCR of 1997, there is a change and the change is that now the developer/owner was required to enter into agreements with 70% of the slum dwellers and unless 70% of the slum dwellers agree, the slum rehabilitation scheme cannot be entertained. The magic figure remains at 70%. The idea behind it is that more than 2/3 of the occupiers must agree for the rehabilitation scheme.

62. As pointed out above, even if the remaining minority slum dwellers do not agree to be part of the scheme, the owner/developer is duty bound to make adequate arrangements for their rehabilitation under the scheme and they can join the scheme, and can take benefit of the scheme even at any later stage. We are, therefore, of the considered view that 70% consent of the occupiers is mandatory. As clarified above, we are not dealing with this aspect in relation to the order of the SRA because the notice under Section 13(2) did not raise this issue. However, we are clearly of the view that under the 1997 DCR the owner is required to produce individual agreements with 70% slum dwellers before the scheme can be taken up for consideration.

63. The circulars issued by the SRA, specially Circular dated 21.08.1997, 19.09.1998 and Circular No. 27 permit conversion of old approved SRD Scheme to new SRA Scheme under the provisions of Clause No.10.1 of Appendix IV of DCR. In the present case, the scheme was initiated under the 55 old DCR of 1991. There is no manner of doubt that the Society was formed by more than 90% of the occupiers.

64. The migration was done to the Scheme of 1997. There is no clear cut provision in the 1997 DCR as to how this migration has to be done. Since there is no clear cut provision, we may presume that while migrating, it was not necessary for Susme to have individual agreements with 70% of the slum dwellers.

We may, however, point out that it was Susme who applied for migration to the new Scheme, obviously because the new Scheme gave greater benefits to the developer. When migration was done, it was on the clear cut understanding that after the migration, the provisions of amended DCR would be applicable. When this application of the Society and Susme for conversion was taken up, it was noticed that one of the main objections was that there were no individual agreements with the slum dwellers.

65. Later, Susme submitted agreements of 450 of the eligible slum dwellers and stated in writing that the remaining to make up 70% would be submitted before start of Phase II of the construction. Fresh letter of intent dated 27.01.1998, in terms of the new DCR, was issued in favour of Susme and approved in accordance with Clause No.33(10) and Appendix IV of amended DCR subject to certain conditions. Clause 19 of the letter reads as follows: “That you shall submit the Agreements with the photographs of wife and husband on the agreements with all the eligible slum dwellers before issue of CC for sale bldg., or 3 months as agreed by developer whichever is earlier. And the name of the wife of the eligible occupier of hut shall be incorporated with joint holder of the tenements to be allotted in rehabilitation building.”

66. A bare perusal of this condition makes it clear that Susme was directed to submit agreements with all the eligible slum dwellers before commencement certificate for sale building was issued or within three months, as agreed by it. It has been urged by Shri Darius Khambata, learned senior counsel that, as per this condition, the agreements have to be submitted only at the stage when the commencement certificate is to be issued. It would also be important to note that even before the rehabilitation building numbers 5 and 6 were completed, Susme was granted TDR to the extent of 40% of the construction of building nos. 5 and 6, which they sold in the open market. The relevant portion of the note dated 16.02.1998 is extracted hereinbelow: “Further as per policy & DCR 33(10) it is necessary that agreements with more than 70% slum dwellers as per new scheme is required.

This was pointed out to CEO (SRA) during discussion, when CEO (SRA) instructed to submit agreements with 70% slum dwellers before second phase of T.D.R. Developers have informed that out of 869 slum dwellers, they have submitted 450 agreements to the office of S.R.A. (52%).” When Susme applied for permission to sell the TDR, the SRA ordered that 70% agreements should be submitted before Phase II TDR and, further, Susme was informed by the SRA that it has only submitted the agreements with 450 slum dwellers which comes to barely 52%.

The Bombay High Court, therefore, rightly recorded that Susme accepted the condition of 70% consent requirement when it accepted these conditions and sold the TDR. Thereafter, on 03.11.1998, occupation certificate was issued in favour of Susme with 58 regard to two rehabilitation buildings. Relevant portion of communication dated 03.11.1998 reads as under: “That the 70 percentage individual agreements with slum dwellers shall be submitted before further approval/CC.”

67. On 24.12.1998, the SRA permitted Susme to take 90% benefit of the TDR equivalent. Relevant portion of this note reads as follows: “As per policy it is necessary that agreements with minimum 70% slum dwellers for new scheme is required. It is also mentioned in the previous report sidelined ‘x’ at page 35. Architect has to submit 70% agreements before granting Phase-II TDR. At present 52 (sic 520) agreements (60%) out of 869 are submitted in this office as mentioned in the letter of Architect as at page…….However, these two Rehab Bldgs are physically occupied and list of documents rehoused is submitted at P-164 to 171 Phase II T.D.R. can be recommended if agreed. In view of above pending requirement if CEO (SRA) agreed TDR equivalent to 0.90 x 3720.90 = 3348.81 (1295 SQ.MT. released in Phase I + 2051.81 sq.mt. to be released & Phase II) sq. mt. Phase II TDR will be recommended to M.C.G.M. “

68. It was noted that Susme was required to submit agreements with 70% of the slum dwellers. On 07.07.1999 Susme, through its architects, sent a letter to respondent no. 1 forwarding 580 individual agreements of the members of the Society and also undertook to submit the remaining, to make 70% in due course. SRA pointed out in its letter dated 59 25.07.2001 addressed to Susme that out of the agreements submitted, only 372 were correct.

69. Here, it will be pertinent to note some other relevant facts. On 11.05.1999, some slum dwellers filed Writ Petition No. 1301 of 1999, challenging the letter of intent dated 27.01.1998 in favour of Susme on various counts including the ground that Susme had failed to obtain consent of 70% or more of the eligible slum dwellers. This petition was dismissed on 13.12.1999 and we have quoted the relevant portion of the Bombay High Court in the earlier part of the judgment. According to Susme, in view of this judgment, it was not required to obtain 70% consent of the slum dwellers. We do not think this is what was said by the High Court. We may note that the main contention by the appellant before the High Court was that the consent of 70% of the slum dwellers was not required under the 1991 Scheme.

The High Court held, and rightly so, that under the 1991 DCR what was required was that 70% of the slum dwellers joined the Society, which was interested in the rehabilitation of slum dwellers 60 and there was no requirement that there should be consent from 70% slum dwellers. The High Court did not discuss at all, the issue whether 70% consent was required under the 1997 Scheme. This judgment will have no bearing on the present case.

70. As we have already indicated above, in a migration from 1991 Scheme to 1997 Scheme, obviously 70% individual agreements cannot be obtained prior to submission of the Scheme. However, while granting migration, the SRA can lay down conditions and such conditions can also be laid down during the course of the Scheme. From the facts narrated above it is more than amply clear that the SRA envisaged, and Susme clearly understood, that it had to obtain consent of 70% of the slum dwellers. Even in the resolutions of the Society authorizing Susme to take up the development work entered after DCRs were amended it was clearly mentioned that amended Regulation 33(10) would govern the agreements. Susme cannot now say that it is not governed by the amended regulations. Even the letters issued by the architects of Susme clearly indicate that they would make up the balance to achieve 70% agreements.

The main dispute is by when this should have been done. Initially, time was given till commencement certificate of the sale building was issued. This was a meaningless condition because if this condition was to be applied after the rehabilitation buildings had been built, then having the consent of the slum dwellers would be an exercise in futility because by then they would have been thrown out of their dwellings. We can, at best, understand this to mean commencement of the rehabilitation buildings. The slum dwellers are interested with the rehabilitation buildings and not with the free sale buildings. Later on, when applying for permission to trade their development rights, Susme clearly understood and undertook that it would furnish the consent forms of 70% of the slum dwellers.

The architects of Susme, in fact, deposited 580 individual agreements but out of these, only 372 were found to be correct. Thereafter, Susme took a U-turn and, relying upon the judgment of the Bombay High Court in CWP No.1301 of 1999, took a stand that it was not required to submit agreements with 70% slum dwellers. This stand was not legally tenable. Susme cannot be permitted to back out of its commitments. The agreements with 70% slum dwellers should have been provided within a reasonable time and, though almost 20 years have elapsed since the second letter of intent was granted in favour of Susme, it has till date failed to submit such agreements. We may again reiterate that we are not dealing with this issue for the purpose of removing Susme but only for the purpose of showing that Susme delayed the project because it failed to get consent from 70% of the occupiers.

WHETHER SUSME DELAYED THE CONSTRUCTION OF THE SCHEME, AND IS, THEREFORE, NOT ENTITLED TO ANY RELIEF:

71. With regard to the issue whether the appellant is responsible for the delay in implementation of the Scheme, at the outset, we may note, that both the SRA and the High Court have dealt with this issue in detail and come to a concurrent finding of fact that Susme was responsible for the delay in implementation of the Scheme. Since this is a finding of fact and dealt with in detail by the High Court, we are not required to examine this contention in detail.

However, at the insistence of the learned senior counsel for Susme we have gone through the voluminous record. From the facts which are set out in this regard it is apparent that Susme first entered into an agreement with the Society on 27.02.1986 committing to complete the project in 5 years. Unfortunately, from 1986 to 1991, nothing was done and the only excuse is that some public interest litigation was pending.

On 25.03.1991, the DCRs were brought into force. On 09.10.1992, the appellant obtained permission for development of the property on certain conditions. It would be important to note that in the letter of 09.10.1992, while granting permission, it was stated that the developer should produce agreement of all the existing occupiers within six months and the development work is to be completed within two years, though the time could be extended for genuine reasons. Admittedly, no work was done during this period also. On 05.04.1995, letter of intent was issued in favour of Susme. In this letter also, there was a stipulation that Susme should produce the agreement with all the slum dwellers.

Thereafter, Susme entered into a fresh agreement with the Society. During this period of 9 long years, not an inch of construction was raised nor any portion of the property developed. Thereafter, in a meeting of General Body of the Society held on 12.11.1995, a resolution was passed that each slum dweller be provided 225 sq. ft. carpet area. This was accepted by Susme and crystallized in the agreement dated 07.01.1998. Between 15.01.1996 to 01.02.1996 Susme obtained ‘intimations of disapproval’ which, in fact, are sanctions for construction for rehabilitation buildings and started construction of two rehabilitation buildings nos. 5 and 6.

Susme’s proposal for conversion of SRD Scheme to SRA Scheme was approved in January, 1998 and fresh letter of intent was issued in favour of Susme on 27.01.1998. During this period, two rehabilitation buildings were constructed but nothing further was done. There is virtually no explanation as to why the remaining rehabilitation buildings were not constructed during this period except to 65 state that fresh plans were never approved.

It is more than obvious from the facts narrated above that Susme never earnestly pursued the authorities for approval of the plans and the reason is not far to seek – the reason being Susme did not have consent/agreements of 70% slum dwellers. It is more than obvious that Susme was buying time on one excuse or the other. On 18.01.2000, the SRA called upon the appellant to submit revised plans in respect of rehabilitation buildings within 10 days of the receipt of the letter. In reply thereto, the architects of Susme sent a letter on 27.01.2000 expressing their intention to start Phase II of the project but, at the same time, sought waiver of the requirement of obtaining 70% consent from the slum dwellers.

This clearly shows that Susme was using this excuse to delay the construction. On 05.01.2001, Susme addressed a letter to the SRA praying that the plan submitted in 1997 be approved. Thereafter, the SRA did not consider Susme’s proposal since, according to the SRA, the proposal was affected by the Coastal Regulations Zone (CRZ) Notification.

72. On 07.07.2001, Susme and the Society filed Writ Petition No. 2269 of 2001, in the Bombay High Court seeking removal of the remarks which indicated that part of the property of the Society was being affected by the CRZ Notification. A perusal of the writ petition and the other documents clearly shows that the entire property was not affected by the CRZ Notification, but only a part thereof. On 07.08.2002, in the petition filed by Susme and the Society, the Bombay High Court passed an order, relevant portion of which reads as follows:

“Prima facie, having perused the affidavit of Dr. Munshil Gautam filed before this Court on 24th June, 2002 and the documents annexed thereto it does appear that the property in question is affected by CRZ regulations. Respondent No. 2 and 3 have already placed Coastal Zone remark which is of course impugned in the present petition but until the petitioners are granted relief as prayed, the petitioners cannot raise any construction in the area which is covered by CRZ regulation. We accordingly observe that during the pendency of petition the petitioners shall not raise any construction in the property in question which is affected by CRZ regulation.”

73. It is apparent from the aforesaid order that stay was granted not to raise construction in the area which is covered by the CRZ Notification. No material has been brought on 67 record to show that the entire plot was covered by the CRZ Notification and it is amply clear that only a portion of the plot was covered by the CRZ Notification and nothing prevented Susme from raising construction on that portion of the land which was not affected by the CRZ Notification. On 09.05.2005, Susme’s architects sought approval of plans for transit accommodation.

This permission was granted on 18.08.2005, but a condition was laid down that 70% agreements must be submitted before the existing structures are demolished. On 14.03.2006, the SRA issued notice to Susme to stop work on various grounds including nonsubmission of demarcation from the competent authority permitting the transit camp to be set up. Thereafter, on 05.09.2006, Susme and the Society entered into another agreement and on 03.04.2008, respondent no. 1 revoked the order dated 29.05.2006, after Susme obtained permission from the State Government allowing the transit camps to remain.

It is apparent that sometime in the year 2005, it was clarified by the concerned authorities that Susme’s construction was not affected by the CRZ Notification. It is 68 obvious that only a portion of the land was affected by the CRZ Notification and nothing prevented Susme from constructing the buildings which were to be constructed on land not falling within the CRZ Notification. However for reasons known only to Susme, it withdrew the Writ Petition No.2269 of 2001 only on 07.04.2008.

It was only thereafter that respondent no. 3-Society passed a resolution on 29.03.2009, terminating the development agreement with Susme. Even after that, the SRA on 15.06.2009 issued a letter that the Society’s request for change of developer need not be considered. On 14.09.2009, the Society entered into agreement with respondent no. 4 – J.G. Developers Pvt. Ltd.. Thereafter, civil litigation started. It has also been urged on behalf of Susme that, in the meantime, a one man Commission was constituted and due to the constitution of this Commission, work was affected.

74. After going through all the material placed on record, we are clearly of the view that the finding given by the SRA that the appellant was responsible for the delay, is a finding based on appreciation of material on record. It cannot be said to be a perverse finding. It is a finding of fact and, therefore, the Bombay High Court was justified in coming to the conclusion that it could not set aside this finding of fact in writ jurisdiction.

We may, however, add that since lengthy arguments were addressed, we have ourselves gone through the various documents and though there may have been a few stop orders and a few occasions when Susme may not have been able to raise the construction but, by and large, Susme was itself guilty of delaying the construction for no reason at all. We, therefore, hold that Susme was rightly held responsible for the delay in implementation of the rehabilitation scheme and, as such, we find no error in the impugned order.

WHETHER SUSME IS ENTITLED TO CONTINUE WITH THE SCHEME:

75. With regard to the issue whether the appellant is entitled to continue with the Scheme; in view of the findings given above, we are clearly of the view that Susme is not entitled to 70 continue with the rehabilitation Scheme on account of the fact that it has been responsible for the delay in completion of the project for an inordinately long time. Susme has not been able to explain the delay. We are dealing with slum dwellers and Susme cannot take the benefit of technical points to defeat the rights of the slum dwellers.

The claim of Susme that it had the support of 70% slum dwellers, was contested before Justice Srikrishna and his findings clearly reveal that Susme does not have the support of 70% of the slum dwellers. We are of the view, that since the notice by the SRA to Susme did not make any specific allegation with regard to Susme not having 70% consent, that portion of the order of the SRA, setting aside the right to develop the land on the ground of lack of 70% consent, may have been beyond the scope of the notice. However, this issue was argued before the HPC and the High Court and on rival claims being made, this Court vide order dated 27.03.2015, referred this dispute to Justice Srikrishna, who has submitted his report.

76. In writ proceedings, the petitioner must show that both in law and in equity it is entitled to relief. In this case, both equity and law are against Susme. It has dealt with slum dwellers in a highly inequitable manner. The law and the conditions of the letter of intent as well as the conditions imposed in the various letters issued by the SRA clearly required Susme to produce agreements with at least 70% of the slum dwellers. This, Susme has miserably failed to do.

We may also add that though Susme may have remained the same entity in name, there have been, at least, three changes in the promoters of Susme and these transfers of shareholdings obviously must have been done for consideration. It is more than obvious that Susme, as a legal entity, was treating the slum dwellers only as a means of making money and, therefore, we are clearly of the view that Susme is not entitled to any relief.

IN CASE SUSME IS NOT ENTITLED TO CONTINUE WITH THE SCHEME WHETHER RESPONDENT NO. 4 J.G. DEVELOPERS IS ENTITLED TO CONTINUE WITH THE REHABILITATION SCHEME:

77. The next issue is whether J.G. Developers is entitled to any relief and can be permitted to continue with the rehabilitation scheme. In this behalf, we may note that the conduct of J.G. Developers is not above board. It is more than obvious that when respondent no. 3-Society entered into a development agreement with respondent no. 4, the members were given a false hope and dream that the size of their flats would go up.

78. Under the terms of this agreement, J.G. Developers agreed to provide permanent alternative accommodation of 344 sq. ft./419 sq. ft. carpet area to the slum dwellers. J.G. Developers also entered into individual agreements and under these agreements, it agreed to provide 344 sq. ft./419 sq. ft. carpet area to some residents. It is obvious that a false promise was held out by J.G. Developers that the carpet area of the flat would be increased from 269 sq. ft. to 344 sq. ft./419 sq. ft.. Obviously, the slum dwellers, who had been waiting for 23 long years for a flat admeasuring 269 sq. ft. would happily accept the offer of a flat of 344/419 sq. ft..

79. From the communications addressed by the SRA, it is obvious that J.G. Developers was legally not entitled to make this offer. It is submitted by Shri Gopal Subramanium, learned senior counsel that J.G. Developers was willing to sacrifice its free sale area to give a larger flat. However, he has failed to submit even one document to show that the SRA had agreed to this proposal of the J.G. Developers.

In fact, the communication sent by SRA clearly shows that the proposal was not accepted. It is, therefore, obvious that J.G. Developers had hoodwinked the members of the Society in entering into an agreement with it by holding out a false promise that they would be given much larger flats. As such, we are unable to accept the request of respondent no. 4- M/s. J.G. Developers, to be permitted to continue with the project.

We may also note that the Society has terminated its agreement with the J.G. Developers. We are not going into the question whether this has been done rightly or wrongly, but the fact is that the agreement stands terminated. We may also note that in the voting conducted by Justice Srikrishna, J.G. Developers failed to get the consent of 70% slum dwellers and, in fact, it has got less than 1/2 of the votes, as compared to Susme, and its support is even less than 30%.

80. It was urged before us that agreements once entered into and the consent once given, cannot be withdrawn. We are totally in agreement with the same. However, if the consent is obtained by misrepresentation of facts, then that is no consent. Now, when the position stands clarified that the slum dwellers would get flats of 269 sq. ft. area only, J.G. Developers has failed to get support of even 30% of the slum dwellers.

81. In view of the above discussion, we are clearly of the view that J.G. Developers is not entitled to continue with the project and is not entitled to any relief.

LAW LAID DOWN BY THE BOMBAY HIGH COURT:

82. Our attention was drawn to various judgments of the Bombay High Court that consent once given by the slum dwellers should not be permitted to be withdrawn. It was also brought to our notice that the Bombay High Court has consistently held that voting inter se developers should not be done. It has been the consistent view of the Bombay High Court that in case voting is done, then this will lead to developers trying to buy out the slum dwellers and then no rehabilitation scheme would attain fruition.

We totally agree with the aforesaid views of the Bombay High Court. We must remember that slum dwellers normally belong to the poorest section of the society. They can be tempted to change their mind. In the present case itself, the slum dwellers shifted from Susme to J.G. Developers for two reasons –

(i) Susme had delayed the project and (ii) J.G. Developers made a promise that it would give a flat of 344 sq. ft./419 sq. ft. area, which promise was obviously a false promise. The view of the Bombay High Court that consent once given should not be permitted to be withdrawn, is absolutely the right view. Otherwise, a person may give consent one day, withdraw it the second day and review the consent the third day, leaving the Scheme in a perpetual state of flux. For the aforesaid reasons, we agree with the Bombay High Court that there should be no inter se bidding between the builders.

The proper course is that the scheme of the developer who is the first choice, should be placed before the slum dwellers and if it gets 70% votes, then the Scheme can be considered, but if it does not get 70% consent, then obviously, the second developer can be considered. However, competitive bidding should not be done because that can lead to a very unholy practice of developers trying to buy out the slum dwellers, which is also not in the interest of the rehabilitation scheme.

83. As far as the present case is concerned, this Court while passing the order dated 27.03.2015, made a departure because of the peculiar facts of this case. The present case because of its own unique facts cannot be treated as a precedent in other cases with regard to action taken in this case.

CONCLUSION:

84. In view of the above discussion, we arrive at the following conclusions:

1. That the order dated 27.03.2015 was passed in exercise of jurisdiction vested in this Court under Article 142 of the Constitution of India and is an order binding on the parties;

2. That vide order dated 27.03.2015, this Court wanted Justice B.N.Srikrishna to find out whether Susme or J.G. Developers had the consent of 70% slum dwellers;

3. That, as a result of the Report submitted by Justice B.N. Srikrishna, both Susme and J.G. Developers have failed to show that they enjoyed support of the 70% of the slum dwellers;

4. That, in the peculiar facts and circumstances of this case, where the owners and occupiers are virtually  one, the SRA had the jurisdiction to invoke the provisions of Section 13(2) of the Slum Act to revoke and set aside the right to develop and cancel the letter of intent granted in favour of Susme. Even if it be assumed that Section 13(2) is not applicable, then the SRA could have exercised this power under Section 3A (3)(c) and (d) of Slum Act.

5. That the notice issued by the SRA to Susme was only on the ground of delay and the issue of obtaining 70% consent was not specifically raised in the notice. Consequently, the order dated 24.02.2012 passed by the SRA in so far as it rejects the case of Susme for lack of 70% consent is beyond the terms of the notice. Therefore, this part of the judgment of the Bombay High Court, holding that Susme was aware about this allegation, is not accepted and is set aside;

6. That, Susme was responsible for the delay in implementation of the Scheme and construction of the buildings and, therefore, the SRA was justified in setting aside the appointment of Susme as developer 79 and impliedly cancelling the letter of intent issued in its favour vide order dated 24.02.2012;

7. That, Susme has failed to show that it has the consent/agreements of 70% of the slum dwellers even today and, therefore, is not entitled to any relief from this Court; and

8. That J.G. Developers obtained the consent of the members of the Society by holding out a false promise of a larger flat and, therefore, the agreements entered into by J.G. Developers with the slum dwellers are legally unconscionable and not enforceable and, as such, J.G. Developers is also not entitled to continue with the Scheme.

RELIEF:

85. This, as pointed out earlier, is a very unusual case. We have held that both the contesting developers are not entitled to any relief. It is our duty to ensure that these owners who also happen to be slum dwellers do not live in sub-human conditions for eternity.

86. We are not only disappointed with the conduct of Susme, but also with the conduct of those persons who were the office-bearers of the Society whichever faction they may belong to. It is more than obvious that the two rival developers and the office-bearers of the Society were playing with the lives of large number of slum dwellers. We are not going into this issue in detail but, if we were to carefully examine the various agreements entered into by Susme with the Society, we find that though the members may have been entitled to larger flat in each subsequent agreement but, in fact, it was the builder, who was the biggest gainer as the advantage of higher FSI was cornered by the builder.

Only a small portion of this advantage was being transferred to the slum dwellers and a large portion was being retained by the builder. Another important aspect is that, in this case, it is the occupiers who, through the Society, are also the owners of the land. In our view, in addition to the flats which they would be entitled to as slum dwellers or occupiers or encroachers of land, they should have been given some benefits as owners of the land.

When a slum, owned by any authority or person, is handed over to the developer, in addition to rehabilitating the slum dwellers, the developer also has to compensate the owner. We see no reason why, in the present case, the slum dwellers, who are the owners, should also not be given some adequate compensation for the land which they own. It is these 800 plus slum dwellers, who own this 23018.50 sq. mtrs. of land, which would be valuing thousands of crores of rupees and, therefore, we see no reason why the slum dwellers, who also happen to be the owners of the land, should also not be compensated for the price of the land.

87. This is a case where the earlier Bench of this Court had invoked its power under Article 142 of the Constitution of India and we also feel that it is a fit case for invocation of this Court’s jurisdiction under Article 142 of the Constitution of India. Hence, in exercise of this Court’s power under Article 142 of the Constitution of India, we issue the following directions/orders for doing complete justice:

1. That the SRA shall within three weeks of the receipt of this order, invite letters of interest from renowned builders/developers, who have the capacity and experience to take up such a large project by issuing advertisements in not less than three newspapers having wide circulation in Mumbai, one each in English, Hindi and Marathi;

2. The advertisement may be brief but all necessary details must be incorporated in the advertisement. The details of the project including a copy of this judgment should be made available on the website of the SRA;

3. After the letters of interest are submitted, the SRA shall consider which is the best offer and while considering the best offer, it shall ensure that the terms offered to the occupiers are in no manner disadvantageous to them when compared to the last offer made by Susme in regard to the area of flat offered, the nature of construction and other facilities available on the site. The SRA must, while evaluating the proposals, take into consideration the past record of the party/person expressing interest: it shall also take into consideration the financial viability of such party/person and, therefore, it may ask such party/person to submit all the documents to support their financial viability. In case of any doubt, the SRA can move appropriate application before this Court;

4. The persons who express interest must be willing to give an assurance that they will submit plans within one month of the approval of their proposal and all the concerned authorities must, within 15 days thereafter, raise objections, if any, giving the successful bidder a chance to remove the objections, if any, within one month thereafter;

5. Thereafter, the concerned authorities should ensure that the plans are approved and sanctions granted latest within two months of the submission of the original plans. The successful developer should undertake to complete the rehabilitation of part of the project to rehabilitate all eligible occupiers/slum dwellers within a period of two years from the date of sanction of the plan. The successful bidder must give a bank guarantee of Rs. 200,00,00,000/- (Rupees Two Hundred crores only) to ensure that it does not violate the terms and conditions of the rehabilitation scheme.

In case of violation of the terms and conditions of the rehabilitation scheme without reasonable cause, the SRA will be entitled to invoke the bank guarantee, after giving notice to the developer;

6. Keeping in view the fact that the slum dwellers are also the owners, the developers may also indicate what benefit they will give to the members of the Society either in cash or in kind by means of giving additional built up area out of their own free sale area to such members of the Society;

7. The SRA shall monitor the progress of the Scheme to ensure that it is completed within the time granted by this Court;

8. No Court or authority shall pass any order which will in any manner affect the implementation of the directions/orders issued by us;

9. The Society, its members, the SRA and all concerned will render complete assistance to the builder/developer, who is awarded the project by the SRA; and

10. That all pending litigation shall be disposed of in view of the aforesaid orders passed by us and shall be disposed of by the Court(s) accordingly.

88. We may also point out that vide order dated 12.10.2017 this Court directed that elections to respondent no. 3-Society be conducted on or before 31.12.2017. These elections were held on 17.12.2017 and a new Managing Committee was constituted. This Managing Committee held its first meeting on 31.12.2017 and has filed an affidavit on 03.01.2018 praying that the mandate recorded in the Report of Justice B.N. Srikrishna be implemented. It has also referred to the proposed amendment to the DCR whereby the requirement for consent is being reduced from 70% to 50%. We have taken this affidavit on record. It does not in any manner affect the view which we have taken.

89. Pending application(s), if any, stand(s) disposed of.

90. The SRA to file status report by 31.03.2018. List on 09.04.2018.

(Madan B. Lokur)

 (Deepak Gupta)

New Delhi

January 04, 2018

A.V. Subramanian Vs. Union of India and ANR [SC 2017 JANUARY]

KEYWORDS:- COMPENSATION-

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We hold that the appellant shall be entitled to the benefit of the judgment of this court  IN Pattammal & Others. v. Union of India and Anotherdated 08.11.2005 passed in Civil Appeal No.1500 of 2004.

DATE:-JANUARY 10, 2017

SUPREME COURT OF INDIA

[Civil Appeal No(S). 303 of 2017 arising from SLP (C) No. 5108 of 2014]

KURIAN, J.

1. Leave granted.

2. Aggrieved by the award passed by the Additional District Judge, Karaikal on 24.1.1994 in L.A.O.P. No.38/1993, the Union of India approached the High Court in A.S.583 of 1994. The said appeal was partly allowed by the judgment dated 23.02.2001, reducing the compensation.

3. Aggrieved, the appellant approached this Court in SLP(C) No.16046 of 2001, which was dismissed in limine – “Special leave petition is dismissed,” by order dated 28.09.2001. Since, the dismissal was not on merits, the appellant filed a review petition before the High Court on 20.11.2001.

When the said review petition was pending before the High Court, in a connected matter, this Court in Civil Appeal No.1500 of 2004 by judgment dated 08.11.2005 titled Pattammal & Others. v. Union of India and Another reported in (2005) 13 SCC 63, allowed the appeal and restored the award passed by the Reference Court.

The appellant contended before the High Court that in view of the subsequent judgment by this Court and in view of the fact that the review petition was already pending before the High Court, the appellant should get the benefit of the judgment dated 08.11.2005 of this Court. It was not in dispute that the acquisition in both the cases was pursuant to the same notification and for the same purpose and the acquired lands were similar. However, the High Court declined to review the judgment. Thus, aggrieved, the appellant is before this Court.

4. As rightly submitted by Shri Venkatramani, learned senior counsel appearing for the Union of India, unless the order passed by this Court in the special leave petition, which rendered in dismissal on 28.09.2001, is reviewed and unless there is also a challenge thereafter to the original order passed by the High Court dated 23.02.2001, the appellant cannot succeed.

5. We may not have any quarrel with the legal position. However, having regard to the factual position that in a land acquisition case the claimants have received different amounts by way of compensation and that too in respect of the lands of same nature covered by the same notification and acquired for the same purpose, we are of the view that all these technicalities should give way since they are procedural and which can still be cured. We do not think that the appellant should be driven to such steps having regard to the factual position we have referred to above.

6. Therefore, we are of the view that the lis should be given a quietus. For doing complete justice, we hold that the appellant shall be entitled to the benefit of the judgment of this court dated 08.11.2005 passed in Civil Appeal No.1500 of 2004.

7. In case the appellant has already received payments, needless to say that the obligation under the security offered before the High Court will stand discharged.

8. . In view of the above, the impugned order is set aside and the appeal is allowed, as above.

9. There shall be no order as to costs.

10. Pending application(s), if any, shall stand disposed of.

[KURIAN JOSEPH]

 [A.M. KHANWILKAR]

Laxmidhar Nayak and Ors. Vs. Jugal Kishore Behera and Ors.[SC 2017 November]

KEYWORDS: COMPENSATION

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As per the decision of the Constitution Bench in National Insurance Company Limited v. Pranay Sethi and Others 2017 (13) SCALE 12, compensation of Rs.15,000/- for loss of estate and Rs.15,000/- for funeral expenses is awarded. Thus total compensation awarded to the claimants is enhanced to Rs.5,34,000/- payable with interest at the rate of 7% per annum.

DATE: November 28, 2017

SUPREME COURT OF INDIA

[Civil Appeal No.19856 of 2017 arising out of SLP(C) No.31405 of 2016]

R. BANUMATHI, J.

1. Leave granted.

2. Appellants who are the sons and daughter of the deceased Chanchali Nayak have filed this appeal seeking enhancement of compensation for the death of their mother in the road accident on 29.09.1991 as against compensation of Rs.70,600/- awarded by the tribunal and affirmed by the High Court of Orissa.

3. Mother of appellants-Chanchali Nayak was working as an agricultural labourer. On the date of accident – 29.09.1991 at about 8.00 a.m., Chanchali Nayak was proceeding on the left side of the road alongwith some other labourers. At that time, due to head-on-collision between two vehicles-bus (bearing No.OSF 5157) and truck (bearing No.OAC 495), the bus swerved to the extreme left side of the road and ran over Chanchali Nayak and she succumbed to injuries. In the claim petition filed by the claimants, the tribunal held that the accident was due to rash and negligent driving of both the vehicles.

3. So far as the compensation is concerned, the tribunal has taken the monthly income of the deceased at Rs.650/- per month and after deducting an amount of Rs.250/- towards her personal expenses, assessed the contribution to the family at Rs.400/- per month. Deceased was aged 42 years and the tribunal adopted multiplier of “12” and awarded compensation of Rs.57,600/- for the loss of dependency and adding conventional damages, tribunal has awarded total compensation of Rs.70,600/-. The respondents No.1 and 2 – owners of the bus and the truck were held liable to pay the compensation to the claimants at 50% each alongwith interest at the rate of 9% per annum. Pointing out that the claimants have not produced the insurance policies of the vehicles, the tribunal held that the insurance company is not liable to indemnify the compensation.

4. However, it is seen from the judgment of the High Court that the insurance company has been satisfied with the award. On appeal to the High Court by the claimants, the High Court affirmed the quantum of compensation of Rs.70,600/- awarded to the claimants but reduced the rate of interest from 9% to 7%. So far as the liability of the insurance company is concerned, the High Court held that the insurance company-respondent No.3 having paid the compensation to the claimants cannot avoid its liability to pay the compensation amount. Being dissatisfied with the quantum of compensation, the appellants have filed this appeal.

5. We have heard the learned counsel for the appellants. Respondent No.2 and insurance company-respondent No.3 have not entered their appearance. We have perused the impugned judgment and the materials placed on record.

6. PW-1 in his evidence stated that Chanchali Nayak was earning Rs.35/- per day as wages out of the labour work. Deceased Chanchali Nayak was an agricultural labourer. The tribunal has taken her income at the rate of Rs.25/- per day and assessed the monthly income at Rs.650/- per month. It is quite improbable that a labourer would be available for such a small amount of Rs.25/- per day. The wages fixed by the tribunal for the daily labourer at Rs.25/- per day and the monthly income at Rs.650/- is too low. The reasoning of the tribunal that a lady labourer may not get engagement daily is not acceptable. Even though works like cutting of paddy and other agricultural labour may not be available on all days throughout the year, in rural areas other kinds of work are available for a labourer.

Deceased Chanchali Nayak even though was said to be earning only Rs.35/- per day at that time, over the years, she would have earned more. In our view, deceased Chanchali Nayak, being a woman and mother of three children, would have also contributed her physical labour for maintenance of household and also taking care of her children. The High Court as well as the tribunal did not keep in view the contribution of the deceased in the household work, being a labourer and also maintaining her husband, her daily income should be fixed at Rs.150/- per day and Rs.4,500/- per month.

7. Taking income from the agricultural labour work at Rs.3,000/- per month and Rs.1,500/- per month for the household work, the monthly income of the deceased is fixed at Rs.4,500/- per month deducting 1/3rd for personal expenses, contribution of deceased towards the family is calculated at Rs.3,000/- per month and Rs.36,000/- per annum. Deceased Chanchali Nayak was aged 42 years. As per the second schedule to the Motor Vehicles Act, 1988, for the age groups 40-45 years multiplier is “15”. As per Sarla Verma (Smt.) and Others v. Delhi Transport Corporation and Another (2009) 6 SCC 121, for the age groups 41-45 years multiplier to be adopted is “14”.

Therefore, the multiplier of “12” adopted by the tribunal and the High Court may not be correct. Hence, the multiplier of “12” adopted may not be correct. Adopting the multiplier of “14” loss of dependency is calculated at Rs.5,04,000/- (3,000x12x14).

8. As per the decision of the Constitution Bench in National Insurance Company Limited v. Pranay Sethi and Others 2017 (13) SCALE 12, compensation of Rs.15,000/- for loss of estate and Rs.15,000/- for funeral expenses is awarded. Thus total compensation awarded to the claimants is enhanced to Rs.5,34,000/- payable with interest at the rate of 7% per annum.

9. The impugned judgment is modified and the compensation payable to the claimants is enhanced to Rs.5,34,000/-. The enhanced compensation is payable with interest at the rate of 7% per annum from 27.01.2016 (the date of judgment of the High Court) and this appeal is partly allowed. Respondents No.1 to 3 are jointly and severally liable to pay the enhanced compensation with interest.

 [RANJAN GOGOI]

 [R. BANUMATHI]

Ismail Hushen Ghanchi Vs. National Highways Authority of India[SC 2017 November]

KEYWORD: Award of compensation-

sc

  1. The compensation in respect of the land acquired from the appellants shall be worked out only on the basis of the calculation based on the return from the fruit-bearing trees, as calculated by the Reference Court.
  2.  On the compensation thus calculated, the appellants shall be entitled to additional compensation and solatium.
  3.  The appellants shall also be entitled to interest under Section 28 of the Land Acquisition Act, 1984

ACT : Land Acquisition

DATE  :November 14, 2017

BENCH: [KURIAN JOSEPH]  [R. BANUMATHI]


SUPREME COURT OF INDIA

Ismail Hushen Ghanchi Vs. National Highways Authority of India

[Civil Appeal Nos.18744-18745 of 2017 @ Special Leave Petition (C) Nos. 32180-32181 of 2016]

KURIAN, J.

1. Delay condoned.

2. Issue notice to Respondent No.1 in Diary No.23978/2017. Notice need not be issued to Respondent No.2, being a proforma respondent.

3. Ms. Jaikriti S. Jadeja, learned counsel, appears and accepts notice for Respondent No.1 in Diary No.23978/2017.

4. Leave granted.

5. The appellants are before this Court aggrieved by the award of compensation in respect of the land acquired along with the fruit-bearing trees. In the High Court, purportedly on the basis of a submission made by the learned counsel, the land value, as enhanced by the Reference Court, was sustained but the compensation in respect of the trees was reduced to 20%. According to the learned counsel for the appellants, it should have been reduced only by 20% and that was what had been submitted. Be that as it may, as an attempt for review also was in vain, we do not want to send back the matters to the High Court.

6. When the matters came up before this Court on 7.11.2017, this Court passed the following order:- “In a petition of compensation for the acquisition of land, the Award can be passed either on the basis of the income one would earn from the fruit bearing trees or on the basis of the market value of the land plus the value of the crops of that particular year. In view of the extent of land of some of the petitioners herein being very small, learned counsel for the petitioners submits that he may be given some time to ascertain whether the petitioners would like to choose the calculation based on the income from the trees.

List on 14.11.2017 as first item”.

7. Learned counsel for the appellants, on instruction, submits that since the holding is very small and since the people have been dependent on the income from the fruit-bearing trees they would go by the calculation on the basis of income from the fruit-bearing trees.

8. The above submission is recorded.

9. Accordingly, these appeals are disposed of as follows:

(i) The compensation in respect of the land acquired from the appellants shall be worked out only on the basis of the calculation based on the return from the fruit-bearing trees, as calculated by the Reference Court.

(ii) On the compensation thus calculated, the appellants shall be entitled to additional compensation and solatium.

(iii) The appellants shall also be entitled to interest under Section 28 of the Land Acquisition Act, 1984 on the entire compensation thus worked out in terms of para (i) and (ii) above.

(iv) Learned counsel appearing for the Respondent/National Highway Authority of India points out that the appellants have already received compensation on the basis of the calculation based on land value.

(iv) We make it clear that in case any of the appellants have received any compensation on the basis of the calculation based on land value, the amount shall be adjusted from the date of receipt along with 15% interest thereon, while granting the compensation. We further make it clear that in case the compensation awarded is deposited in Court, there shall be no adjustment of interest.

(v) Needless to say that compensation necessarily includes solatium and interest on the amount.

10. Pending applications, if any, shall stand disposed of.

11. There shall be no orders as to cost.


WITH : [C.A. No.18746/2017 @ SLP (C) No. 18269/2017] [C.A. No.18749/2017 @ SLP (C) No. 18789/2017] [C.A. No.18750/2017 @ SLP (C) No. 18790/2017] [C.A. No.18747/2017 @ SLP (C) No. 18547/2017] [C.A. No.18748/2017 @ SLP (C) No. 18549/2017] [C.A. No.18751/2017 @ SLP (C) No. 21374/2017] [C.A. Nos.18752-18753/2017 @ SLP (C) Nos.32195-32196 @ Diary No(S). 23978/2017]