[Insurance] No double benefit if victim also reimbursed by non-statutory source: Calcutta High Court

The Calcutta High Court has held that the liability of an insurer in reimbursing medical expenses through Mediclaim is independent of the liability imposed on an insurance company to pay compensation as per the Motor Vehicles Act, 1988. (Ratna Dey vs. Bajaj Allianz General Insurance Co. Ltd.).Justice Shekhar B Saraf concluded that there would be no double benefit to the victim if they were reimbursed from another source, if the compensation additionally payable is statutory in nature..The Single Judge clarified that there lies a distinction between the right to claim compensation via a statute vis-à-vis a contract..“The statutory liability arising from the Act is absolute and it must be discharged if no contributory negligence has been proved on part of the victim”, the Judge said. .The Court was hearing an appeal challenging an order of the Motor Accident Claims Tribunal (MACT), which had granted the claimant a total compensation of ₹ 4,43,240 after deducting the medical reimbursement of expenses received by her husband from his employer. .The MACT deducted the mediclaim amount from the insurance payable under the Motor Vehicles Act, reasoning that a double benefit cannot be given to the claimant..This order was challenged by the claimant. It was argued that the tribunal erred in not ordering full reimbursement for medical expenses amounting to ₹21,75,853, since the bills and medical expenses exhibited are undisputed. .Reliance was placed on the judgement in The New India Assurance Co. Ltd. vs. Bimal Kumar Shah to buttress the argument that the amount ought to have been reimbursed..The insurance company, on the other hand, argued that the medical expenses were already paid by the employer of the claimant’s husband and that the same was proved by Right to Information (RTI) replies..The Court, while dealing with the issue of double benefit arising out of medical reimbursement, discussed the judgement of the Supreme Court in Helen C. Rebello vs. Maharashtra State Road Transport Corporation, which had stated:“Any amount received or receivable not only on account of the accidental death but that would have come to the claimant even otherwise, could not be construed to be the ‘pecuniary advantage’, liable for deduction.”.Further, the Single Judge referred to the judgement titled The New India Assurance Co. Ltd. vs. Bimal Kumar Shah, which also relied upon by the claimant. .This decision established that an insurance company, despite receiving premiums from the insured, cannot achieve gains merely because the victim received money out of the faithful discharge of contractual liability by another insurance company..“Should such an insurance company despite receiving premiums from the insured to indemnify him be allowed to achieve gains merely because the victim of the accident has received some money out of faithful discharge of contractual liability by another insurance company? The answers to the aforesaid questions cannot be in favour of the insurance company which is under a statutory liability to pay", it was held in the Bimal Kumar Shah case. .Finally, the High Court relied on a judgment by the Bombay High Court, wherein it was laid down that that a claim for compensation in regard to motor accident filed by the injured is neither a suit nor an adversarial lis in the traditional sense. Thus, the benefits emanating from an independent and unconnected contract of insurance cannot be considered by the Tribunal..“In the context of the distinction between the contractual liability under the contract of insurance (medical) and the statutory liability under the Act, the aforesaid proposition, not to deduct the amount of reimbursement received, under a Mediclaim policy, appears to be in consonance with the principle of beneficial interpretation and advances the object of the Act", the Bombay High Court had ruled..In view of these precedents, the Calcutta High Court decided that the liability of an insurer to provide insurance through mediclaim is distinct from and independent of the liability imposed on the insurance company under the Motor Vehicles Act..Justice Saraf stressed that while interpreting beneficial legislation it is important to focus on the legislative intent behind it. In case the victim was to be compensated by virtue of two statues for the same incidents, the picture would be different, he added..Unless the victim is compensated by virtue of another statute, the question of deduction of any reimbursement of the medical expenses cannot arise while calculating the compensation payable to a victim under the Act, Justice Saraf said. .The appeal before the Court was disposed of with directions to pay the claimant the balance amount due from the insurance company. .Advocate Ashique Mondal appeared for the petitioners and the respondents were represented by Advocate Rajesh Singh..[Read Judgement]