Judgment:
S.T. Kharche, J.
1. By invoking the jurisdiction of this Court under Section 96 of the Code of Civil Procedure, this first appeal has been filed by M/s New India Assurance Company Ltd. Challenging the judgment and award passed by the Claim Tribunal underSection 110-A of the Motor Vehicles Act, 1939 (for short the M. V. Act) directing the Insurance Company as well as the owner of the motor vehicle involved in the accident to pay jointly and severally the amount of Rs. 17,000/- to the applicants together with interest @ 12% per annum from the date of application till realisation.
2. Relevant facts are required to be stated as under :
The accident occurred on 25-1-1982. Sher Ali died as a result of an accident arising out of the use of motor vehicle, i.e. truck bearing No. MHG 7622. This truck was hired by the deceased for carrying iron rods, sheeps and goats. He along with goods, was travelling in the truck which was scheduled for Nagpur. When the truck reached near Shahapur bridge, it turned turtle as a result of which Sher Ali and his master Sheikh Hamid died in that accident. So also 36 out of 55 sheeps and goats also succumbed to the injuries and remaining 19 sheeps and goats sustained injuries. It is contended that the truck bearing No. MHG 7622 is owned by the respondent No. 4 Mohansingh Punjabi and the said motor vehicle is said to have been insured with the appellant. The respondent Nos. 1, 2 and 3 are the legal representatives of the deceased who had filed claim petition before the Tribunal.
3. The contention of the appellant before the Tribunal was that the truck bearing No. MHG 7622 was carrying unauthorised passengers in the goods vehicle against the terms and conditions of the insurance policy and also sheeps and goats were being carried without obtaining special permit for carrying such animals as is required under the M. V. Act and therefore, the insurer cannot be held liable for any compensation. The parties adduced the evidence before the Tribunal and by the order dated 1842-1989, the Tribunal allowed the claim petition and directed the Insurance Company, driver and the owner of the motor vehicle to pay jointly and severally the amount of compensation of Rs. 17,000/-with interest @ 12% per annum from the date of application till realisation. This order is under challenge in this appeal.
4. Ms. Khare, the learned counsel for the appellant contended that the Tribunal has committed an error in saddling the Insurance Company with the liability to pay the amount of compensation. She contended that the deceased was travelling along with the goods in the goods vehicle i.e. the truck and therefore, the Insurance Company is not liable to pay the compensation as there was breach of the terms and conditions of the insurance policy, though the vehicle involved in the accident has been duly insured with it. She contended that the insurance policy which is issued is not statutorily required to cover the liability of the passengers or the owners of the goods, travelling in the goods vehicle. The learned counsel therefore contended that the impugned award passed by the Tribunal is not sustainable in law and therefore, this appeal may kindly be allowed. In support of these submissions she relied on the decision of the Division Bench of the Hon'ble Supreme Court in the case of National Insurance Co. Ltd. vs. Ajit Kumar and others, : AIR2003SC3093 .
5. None present for the respondent No. 3, owner of the motor vehicle, i.e. truck.
6. The learned counsel for the respondents-legal representatives of the deceased contended that the Tribunal has considered the question whether the Insurance Company was liable to pay compensation and held that the Insurance Company as well as the driver and owner of the motor vehicle are jointly and severally liable to pay the amount of compensation. Therefore, according to him, the order passed by the Tribunal is perfectly legal and valid and no interference into the same is warranted.
7. This Court has given thoughtful consideration to the contentions canvassed by the learned counsel for the parties. In Ajit Kumar's case, : AIR2003SC3093 it has been observed by the Hon'ble Supreme Court that:
'Third party risks in the background of vehicles which are the subject matter of insurance are dealt with in Chapter VIII of the old Act and Chapter XI of the Act. Proviso to Section 147 needs to be juxtaposed with Section 95 of the old Act. Proviso to Section 147 of the Act reads as follows:
'Provided that a policy shall not be required -
(i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen's Compensation Act, 1923 (8 of 1923), in respect of the death of, or bodily injury to, any such employee -
(a) engaged in driving the vehicle, or
(b) if it is a public service vehicle engaged as a conductor of the vehicle or in examining tickets on the vehicle, or
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability.'
It is of significance that the proviso appended to Section 95 of the old Act containedClause (ii) which does not find place in the new Act. The same reads as follows:
'(ii) except where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment, to cover liability in respect of the death of or bodily injury to persons being carried in or upon or entering or mounting or alighting from the vehicle at the time of the occurrence of the event out of which a claim arises.'
The difference in the language of 'Goods vehicle' as appearing in the old Act and 'goods carriage' in the Act is of significance. A bare reading of the provisions makes it clear that the legislative intent was to prohibit goods vehicle from carrying any passenger. This is clear from the expression 'in addition to passengers' as contained in the definition of 'goods vehicle' in the old Act. The position becomes further clear because the expression used in 'goods carriage' is 'solely for the carriage of goods'. Carrying of passengers in a goods carriage is not contemplated in the Act. There is no provision similar toClause (ii) of the proviso appended to Section 95 of the old Act prescribing requirement of the insurance policy. EvenSection 147 of the Act mandates compulsory coverage against death of or bodily injury to any passenger of 'public service vehicle'. The proviso makes it further clear that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in goods vehicle would be limited to liability under the Workmen's Compensation Act, 1923 (in short 'the WC Act'). There is no reference to any passenger in 'goods carriage'.
The inevitable conclusion, therefore, is that provisions of the Act do not enjoin any statutory liability on the owner of a vehicle to get his vehicle insured for any passenger travelling in a goods carriage and the insurer would have no liability therefor.
Our view gets support from a decision of a three-Judge Bench in New India Assurance Co. Ltd. vs. Asha Rani and Oriental Insurance Co. Ltd. vs. Devireddy Konda Redy.
8. This Court may usefully refer the larger Bench decision of the Supreme Court in the case of National Insurance Co. Ltd. vs. Baljit Kaur and others, : AIR2004SC1340 wherein it has been held in para 20 as under:
'It is, therefore, manifest that in spite of the amendment of 1994, the effect of the provision contained inSection 147 with respect to persons other than the owner of the goods or his authorised representative remains the same. Although the owner of the goods or his authorised representative would now be covered by the policy of insurance in respect of a goods vehicle, it was not the intention of the Legislature to provide for the liability of the insurer with respect to passengers, especially gratuitous passengers. Who were neither contemplated at the time the contract of insurance was entered into, nor any premium was paid to the extent of the benefit of insurance to such category of people.'
9. The Hon'ble Supreme Court having taken into consideration the earlier decisions on this issue in the case of National Insurance Co. Ltd. vs. Ajit Kumar, : AIR2003SC3093 , New India Assurance Co. Ltd. vs. Asha Rani, : AIR2003SC607 , New India Assurance Co. vs. Satpal Singh, : AIR2000SC235 , laid down the law that it was not the intention of the Legislature to provide for the liability of the insurer with respect to passengers, especially gratuitous passengers, who were neither contemplated at the time the contract of insurance was entered into, nor any premium was paid to the extent of the benefit of insurance to such category of people.
10. In the present case, admittedly the deceased and his servant were travelling as passengers in the goods vehicle. Though the deceased was also travelling along with goods in the goods vehicle, it cannot be said that the Insurance Company is liable to pay the compensation especially when the deceased and his servant were neither contemplated at the time of the contract of insurance was entered into, nor any premium was paid to the extent of the benefit of insurance to such category of people, therefore it is obvious that the appeal deserved to be allowed to this extent.
11. However, the Hon'ble Supreme Court also laid down law by observing in para 21 in National Insurance Co. Ltd. vs. Baljit Kaur's case (cited supra) as under:
'The upshot of the aforementioned discussions is that instead and in place of the insurer the owner of the vehicle shall be liable to satisfy the decree. The question, however, would be as to whether keeping in view the fact that the law was not clear so long such a direction would be fair and equitable. We do not think so. We, therefore, clarify the legal position which shall have prospective effect. The Tribunal as also the High Court had proceeded in terms of the decisions of this Court in Satpal Singh (supra). The said decision has been overruled only in Asha Rani (supra). We, therefore, are of the opinion that the interest of justice will be subserved if the appellant herein is directed to satisfy the awarded amount in favour of the claimant if not already satisfied and recover the same from the owner of the vehicle. For the purpose of such recovery, it would not be necessary for the insurer to file a separate suit but it may initiate a proceeding before the executing Court as if the dispute between the insurer and the owner was the subject-matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer. We have issued the aforementioned directions having regard to the scope and purport ofSection 168 of the Motor Vehicles Act, 1988 in terms whereof it is not only entitled to determine the amount of claim as put forth by the claimant for recovery thereof from the insurer, owner or driver of the vehicle jointly or severally but also the dispute between the insurer on the one hand and the owner or driver of the vehicle involved in the accident inasmuch as can be resolved by the Tribunal in such a proceeding.'
12. In view of this clear law laid down by the Supreme Court, it is obvious that the appellant Insurance Company would not be liable to pay the compensation to the claimants, but at the same time the insurer will have to satisfy the award and therefore to subserve the ends of justice, this Court direct the appellant to deposit the amount of the award in this Court within four weeks, if the amount of compensation is not already paid to the claimants and then to recover it from the owner of the motor vehicle in accordance with the observations mentioned above by filing the application for execution before the Tribunal. For these reasons, the appeal is partly allowed to the aforesaid extent and in the circumstances there shall be no order as to the cost. The copy of this judgment be retained in First Appeal No. 56 of 1990.