Judgment:
Hari Nath Tilhari, J.
1. This appeal has been filed by the owner of the motor vehicle, i.e., the insured from the judgment and award dated 11.11.1993 in M.V.C. Case No. 1019 of 1989 which M.V.C. case had been decided along with other M.V.C. cases arising from one and same accident. The Tribunal in its award has ordered that M.V.C. Case No. 1019 of 1989 is allowed awarding compensation of Rs. 1,47,000 only with interest at the rate of 6 per cent per annum from the date of petition till the date of deposit and has directed the respondent No. 1 National Insurance Co. Ltd. to deposit Rs. 10,000 with proportionate interest and respondent No. 2 C.K. Seetharam, owner of the lorry, to deposit Rs. 1,37,000 with proportionate interest and proportionate cost.
2. According to the averments made in the claim petition on 10.7.1989 deceased Gangasundar at 7.00 a.m. was travelling in a lorry bearing registration No. CRT 8200. That lorry according to the claimant's case was driven in a rash and negligent manner by the driver of the lorry and it met with the accident which resulted in causing fatal injury to deceased Gangasundar who died on the spot. According to the claimant's case Gangasundar was aged about 26 years and was earning about a sum of Rs. 1,000 as an employee of Indian Oxygen Limited, Tumkur Road, Bangalore. According to the claimant's case Gangasundar boarded the lorry bearing No. CRT 8200 near Kengal Kepohalli Gate on the Bangalore-Tumkur Road with his goods. Gangasundar had to engage the lorry to carry the goods, viz., two bags of rice. He boarded the lorry along with his goods and paid the charges for transporting goods. According to the claimant's case, the claimant was sitting in the cabin of the lorry along with his goods and lorry proceeded towards Bangalore, the driver drove the same in a rash and negligent manner as a result of which lorry bearing No. CRT 8200 dashed with the lorry No. CAS 6464 which was standing on the left side of the road. As a result of the above accident Gangasundar was injured and had died and was taken to the Dabaspet Primary Health Centre for conducting the post-mortem as he had died out of the injuries caused during the accident. After post-mortem, the claimants took the dead body of Gangasundar and performed the funeral ceremony, etc., and spent a sum of Rs. 10,000. The claimant's case is that since on account of the death of Gangasundar which had taken place on account of rash and negligent driving of the lorry No. CRT 8200, the family lost source of income and livelihood and as such the claimants made a claim for award of compensation to the tune of Rs. 5,00,000 and that claim of the claimant was denied by the insurance company, i.e., respondent No. 1 in the claim petition who is respondent No. 5 in the memo of appeal. Respondent No. 2 also filed its objections. They denied the allegations made in the claim petition. Respondent No. 2 to the claim petition, i.e., the present appellant took the plea to the effect that the motor vehicle, i.e., the lorry No. CRT 8200 was covered by a comprehensive insurance policy with respondent No. 1 insurance company, viz., policy No. 60200-4630/614 - Certificate No. 070775. Respondent No. 2 pleaded that he was not liable to pay any compensation. In para 3 of the written statement of respondent No. 2 there was no denial of the allegation that deceased Gangasundar was travelling in the lorry in question with the goods and it has been stated that it is correct to say that Gangasundar had engaged the lorry from Gate to transport or to carry two bags of rice to Bangalore. Respondent No. 2, i.e., the present appellant in its written statement stated that the driver of the lorry was not driving with greater speed, rashly and negligently. As mentioned earlier respondent No. 2 denied the case pleaded by the claimant in other respects. On behalf of the insurance company, i.e., the respondent No. 1, in the case as mentioned earlier, written statement was filed. The case pleaded by the claimant was denied by respondent No. 1 as well, but respondent No. 1 the insurance company admitted that lorry bearing registration No. CRT 8200 belonging to C.K. Seetharam, respondent No. 2, was insured with it and the period of insurance commenced from 13.1.1989 and it ran up to 12.1.90 and it was further averred that respondent No. 1's liability was to indemnify the liability subject to the terms and conditions of the policy. The respondent No. 1, viz., the insurance company by an amendment has raised the following plea as well by addition of para 7 in its written objections. The newly added para 7 reads as under:
(7) This respondent states that the deceased Sundar had travelled in the lorry No. CRT 8200 on 10.7.1989 as a gratuitous passenger and the risk in respect of a passenger travelling in a goods vehicle not required to be covered under Section 95 of the Motor Vehicles Act and not being covered under the policy in question; this respondent is not liable to indemnify the insured.
3. On the basis of the pleadings of the parties, the Tribunal framed the following issues:
(1) Whether the petitioner proves that on 10.7.1989 at about 7 a.m. while he was standing near Kengal Kepohalli on Bangalore-Tumkur Road, that the vehicle bearing registration No. CRT 8200 came at high speed in a rash and negligent manner and dashed him in the act of overtaking another lorry, resulting in injuries to him?
(2) Whether the petitioner is entitled to any compensation? If so, what amount?
(3) What order?
4. The Tribunal on consideration of material on record answered issue No. 1 in affirmative and held that the accident in question did take place at the time, date and place as pleaded by the claimants due to rash and negligent driving of the lorry bearing No. CRT 8200 by its driver and that Sundar alias Gangasundar died as a result of injuries caused to him on account of that accident. The Tribunal further held that driver of the lorry bearing registration No. CRT 8200 has been solely responsible for causing the accident and accident did take place on account of rash and negligent driving of the said lorry by the driver.
The Tribunal further relied on the evidence of PWs as well as the averments contained in deposition of RW, Ramesh, driver of the lorry that Sundar requested him for transportation of the rice bags and the sum to be paid was agreed as Rs. 15 for the transportation of the two rice bags. Sundar was travelling in the lorry with those two bags of rice at the time when the accident did take place. It held that Sundar cannot be said to be a person travelling as gratuitous person. The Tribunal held that Sundar was travelling with his goods as the owner of the goods with two bags of rice to be transported in that lorry or by that lorry. The Tribunal further opined that the evidence on record including the postmortem report establishes that the death had taken place on account of the injuries caused on Sundar's body and the injuries had been caused due to the fatal accident. The Tribunal found that total dependency was to the extent of Rs. 1,26,000 and a sum of Rs. 1,26,000 would be just and proper to be awarded as compensation for loss of dependency. The Tribunal further awarded a sum of Rs. 5,000 with reference to funeral and obsequies expenses. It awarded another sum of Rs. 10,000 for loss of consortium and Rs. 6,000 for loss to estate to the claimants. Thus the Tribunal awarded a total sum of Rs. 1,47,000 as compensation with interest at the rate of 6 per cent per annum from the date of petition till the date of deposit. It further held that company was liable to deposit a sum of Rs. 10,000 with proportionate interest out of the sum awarded as compensation and the balance of sum of Rs. 1,37,000 with proportionate interest at the rate of 6 per cent per annum and proportionate cost, the Tribunal found to be payable and be paid by Seetharam, who was respondent No. 2 in the claim petition and who is the present appellant.
5. Having felt aggrieved from the order of the Tribunal, the respondent No. 2 in the claim petition, Seetharam, the owner of the motor vehicle, has come up in appeal before this Court. I have heard Mrs. Bhushani Kumari, learned Counsel for the appellant and Mr. Hegde Mulkhand, learned Counsel for the respondent No. 5, i.e., insurance company at length.
6. The principal and the only point that has been urged before me by the learned Counsel for the appellant is that the Tribunal committed a legal error in taking the view that the liability of the insurance company was limited only to the tune of Rs. 10,000 plus proportionate interest and in fastening the responsibility for payment of the rest amount of Rs. 1,37,000 plus proportionate interest on the appellant. Learned counsel submitted that the Tribunal ought to have held that as the vehicle in question was insured, the liability of respondent insurance company was unlimited and it should have held insurance company to be liable to pay the entire amount under the award. Mrs. Bhushani Kumari, learned Counsel for the appellant submitted that in view of the fact that the occurrence did take place on 10.7.1989 the law applicable would be the law under Section 147 of the Motor Vehicles Act, 1988 and not the provision of law of 1939 Act. She submitted that in view of Section 147, as the deceased Sundar alias Gangasundar died in course of the accident, he was either a passenger or hirer or was he a gratuitous passenger as was asserted by respondent No. 5. Mrs. Bhushani Kumari submitted that he was the owner of two bags of rice which he had to carry and was carrying in the vehicle from his village to Bangalore. She submitted that on this fact there is no dispute between the claimant and the owner of the vehicle and as per evidence before the Tribunal also, that deceased Gangasundar hired the lorry aforesaid for transporting two bags of rice and he had accompanied with that rice. No doubt the vehicle was a goods vehicle but he could travel in view of the provisions of Rule 100 of the Karnataka Motor Vehicles Rules, 1989 which is analogous to Rule 161 of the old Rules. She submitted that in Section 147(1) the legislature has used the expression 'including the owner' after expression 'any person' in this section. She submitted it might have been added by the Amending Act of 1994 but under the scheme of the new Act the owner of the goods is included. 1994 Act only makes it more explicit and clear, that is, it clarified the intention of the framers of the Act as originally enacted. So she submitted that there was no question of any specific policy or premium being paid by the insured for the goods being carried along with owner of goods or hirer in the goods vehicle when the owner is and has under the Rules, been authorised to travel along with the goods and the liability clause, i.e., Sub-section (1) of Section 147 indicates that in respect of owner also, i.e., the owner or his authorised representative, the insurance company gives assurance to the insured to indemnify when any liability is fastened on the insured. She submitted that the liability for damages arising on account of death of deceased Sundar when it was fastened on the appellant by the Tribunal, equal liability should have been fastened on the insurance company and not the liability to pay or indemnify the compensation only to the extent of Rs. 10,000. These contentions of Mrs. Bhushani Kumari, counsel for the appellant, have been hotly contested by Mr. Hegde Mulkhand.
7. Learned counsel for the respondent insurance company submitted that the policy only covers the liability with reference to six employees and the driver, i.e., to the maximum number of seven only. The liability as owner of the goods was not the subject-matter of liability to be covered under law and the time when the insurance policy was taken and with respect to non-fare paying passengers (NFPP), the policy indicates that liability had been taken with reference to one accident in all to the extent of Rs. 50,000 while with reference to an individual to the extent of Rs. 10,000. Learned counsel further submitted that the deceased Sundar alias Gangasundar was a NFPP and the liability was only for one person to the extent of Rs. 10,000 and the maximum liability with reference to an accident was Rs. 50,000. Learned counsel invited my attention to the endorsement contained in the policy. He submitted that even if there was statutory liability, the liability had been limited to the extent of the sum indicated thereunder and no liability can be fastened for any sum beyond one indicated in the policy. Learned counsel further submitted that accident did take place within a period of 4 months from the date of enforcement of new Act and, therefore, limited liability policy will be operative and remains operative. It is wrong to submit that there was unlimited liability. Mr. Mulkhand further submitted that in Section 147(1)(b) expression 'including owner of the goods or his authorised representative carried in the vehicle' did not exist at the time either when the policy was taken or at the time when the accident did take place. He submitted this expression was not at the time when Act was originally enacted. Learned counsel submitted that the expression 'any person' has been interpreted by the Full Bench in the light of Section 95 of the Motor Vehicles Act, 1939 and it will only mean and include the persons, i.e., the employees to the extent of 6 as determined under the Rules and liability in respect thereof is limited to the one awarded under Workmen's Compensation Act and not for anything else. This expression will not include in itself the owner of the goods travelling in the goods vehicle unless and until there has been a specific agreement or unless and until specifically premium has been paid to cover such a person under the policy. It has been submitted that Rs. 36 must be paid for NFPP with limited liability to the extent of Rs. 10,000 with respect to one person and there is no question of this being made unlimited. Learned counsel further submitted that Full Bench had taken the view that the owner of the goods in respect of whom liability could be fastened against insurance company should be the person who is established to have entered into an agreement with the owner of vehicle for carrying goods and goods are those as defined in Section 2 (7) of the Act of 1939. The learned Counsel contended that really the Tribunal should not have fastened the liability on the respondents even to the tune of Rs. 10,000 as well. Learned counsel submitted that as for NFPP an additional premium had been paid for additional respondents and that limited liability had been indicated in the policy, insurer's liability will be limited to the tune of Rs. 10,000 only. Insurance company's liability for death of the owner of the goods, if at all, could be fastened on the insurance company only to the extent of Rs. 10,000 in view of the terms of the insurance policy. Learned counsel invited my attention to item 14-B contained in the policy. Learned counsel for the respondents placed before me the Full Bench decision of this Court in National Insurance Co. Ltd v. Dundamma, : ILR1991KAR2045 . He also made reference to the decision of this Court in the case of Oriental Insurance Co. Ltd. v. Irawwa, : AIR1992Kant321 and to the decision of this Court in United India Insurance Co. Ltd. v. H.B. Siddappa, : AIR1994Kant338 . He also made reference to the decision of their Lordships of the Supreme Court in the case of National Insurance Co. Ltd. v. Jugal Kishore, 1988 ACJ 270 (SC). These contentions of the learned Counsel for the respondent have been hotly contested by the appellant's learned Counsel in the rejoinder and she submitted that the expression 'any person' in the context of the change of language of Section 147 or to say in a context of its language variation from Section 95 used in Act of 1939 'any person' under Act of 1988 can be said to have included in itself the owner of the goods travelling in the goods vehicle and particularly in the context of language of Section 147(2)(a) of the Act. The learned Counsel submitted that the expression 'including the owner of the goods or his authorised representative' was really something which already existed, included and covered by the expression 'any person' and by Amending Act No. 54 of 1994, which has come into force on 14.11.1994, legislature has only made explicit and clear what was contained and covered by within the expression 'any person' used in Section 147(1) earlier and that has been done taking in view this Court's earlier decisions as well as to avoid any confusion. The learned Counsel submitted that the beneficial provision has been enacted for the benefit no doubt of the injured or the dependants, in case of death in accident, of the deceased so that they may get the real compensation at the earliest possible time. That learned Counsel for appellant urged the purpose oriented interpretation of such beneficial provisions which may be beneficial to the injured or in case of death, to the dependants of deceased need be given, and it may fulfil the object of provisions which require compulsorily that the vehicles should be insured.
8. I have applied my mind to the contentions raised by the learned Counsel for the parties. Before I proceed further let us have a glance on the factual position. The case of the claimant had been that the deceased Gangasundar had hired the goods vehicle and asked the driver to allow his two bags of rice to be taken and with the rice or goods he had also travelled and for the transportation of the goods, i.e., two bags of rice, he paid Rs. 15. This allegation of the claimant has been admitted by the respondent No. 2 in the claim petition vide para 3 of the objections as referred to above of respondent No. 2. PW 3 Jayalakshmamma has deposed that:
On 10.7.1989 while my husband was returning in the lorry bearing No. CRT 8200 to Bangalore with two gunny bags of rice to their residence at Kantegrava Nagar, Yeshwanthpur, the vehicle was involved in an accident near Kengal Kepohalli in which he succumbed to injuries and states that she came to know her husband loaded the two gunny bags of rice at Yedahalli on the said lorry and was coming to Bangalore.
In cross-examination which has been done on behalf of R1, i.e., the insurance company, PW 1 clearly states that:
After coming to know of the accident, I went near the place and shifted two bags of rice from that place to my house.
She had denied the suggestion that the deceased was not carrying the rice bags on the date of the accident. The evidence of this witness clearly reveals that deceased was carrying two gunny bags of rice on the vehicle in question which met with the accident. Statement of the driver, RW 1, is,
When I reached near Dabaspet, an ex-labourer by name Sundar was standing by the side of the road along with 2 gunny bags of rice. On seeing him I stopped the lorry, Sundar requested me for transportation of the rice bags and that he paid Rs. 15. Then I asked him if he also assists for loading of dalmatic minerals at Bangalore, then I would pay Rs. 30 as unloading charges for which Sundar accepted. Accordingly, Sundar boarded the lorry along with his two bags of rice.
This statement in examination-in-chief clearly supports the claim of the claimant that deceased Sundar hired the lorry in question, loaded his two bags of rice on that lorry and as per agreement the consideration for transportation of rice was Rs. 15. He not only loaded the rice bags but he also boarded the lorry with his goods. Ramesh, RW 1, denied the suggestion made on behalf of the insurance company in course of cross-examination and deposed that,
It is not correct to suggest that the deceased Sundar was not standing along with two bags of rice and that I picked him without collecting any charges.
A perusal of this statement of RW 1 along with statement of PW 3 clearly reveals that at the time when he boarded the goods vehicle he had hired it for the transportation of two bags of rice to Bangalore from his village for charges therefor as agreed and he boarded along with those two bags of rice as the owner of the goods. Nothing has been brought in cross-examination which may cause any doubt upon the reliability of his deposition or evidence. Thus in my opinion when deceased Sundar hired the lorry for the purpose of transportation of the goods and when he boarded with those two bags of rice he cannot be said to be gratuitously moving but he was sitting in the lorry as the owner of the goods which were being transported from the village as mentioned in the statement to Bangalore. Under Rule 100 it is clearly laid down as a general rule that no person shall travel in a goods vehicle but there is explanation/exception provided in the rule and the one who is the owner of the goods or a hirer or any employee of the owner or hirer of the vehicle or a police officer in uniform may be carried in a goods vehicle. The total number of such persons is no doubt a fixed one. It is nobody's case that in addition to transportation charges he had to or did pay any sum more. So under Rule 100 framed under the new Act of 1988 by Karnataka it can be said that deceased Sundar was travelling with the goods, he was an authorised traveller in the goods vehicle, i.e., lorry. It is nobody's case that number of persons carried in the vehicle, i.e., lorry was more than the fixed number under the Rules. So the deceased was neither a gratuitous traveller nor an unauthorised traveller but was an authorised person, and carried with goods transported as per Rule 100 of Karnataka Motor Vehicles Rules, 1989. Learned counsel for the respondent submitted and emphasised that in Full Bench decision of this Court it has been laid down that owner of the goods may be authorised to travel in the goods vehicle under Rule 161 of the old Rules, but the insurance policy does not by itself cover the liability for damages/ compensation which the owner of the lorry has to make good to pay-off or to discharge in case of injury to or death of such a person travelling in the goods vehicle though he may be the owner of the goods unless and until a special or additional premium is paid for insuring the liability of such a person by the insured. It is in this connection he also made reference to the other decisions which may be referred hereinafter. He further submitted that by substitution for the expression 'injury to any person' by the expression 'injury to any person, including owner of the goods or his authorised representative carried in the vehicle' amendment has been effected subsequent to the occurrence and is not retrospective, so he vehemently submitted that even if under Rule 100 he was authorised to travel but liability with reference to such person, i.e., owner of goods cannot be fastened as a statutory liability under Section 147, except that it may be on the ground of an extra premium paid separately, i.e., Rs. 36 premium paid for non-fare paying passengers liability which is mentioned to the extent of Rs. 10,000. Before I proceed further, it will be just and proper and profitable to refer to Section 147 of the Motor Vehicles Act, 1988 which reads as under:
Section 147. Requirements of policies and limits of liability.-(1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-
(a) is issued by a person who is an authorised insurer; and
(b) insures the person or classes of persons specified in the policy to the extent specified in Sub-section (2)-
(i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place:
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.
Explanation.-For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place.
(2) Subject to the proviso to Sub-section (1), a policy of insurance referred to in Sub-section (1), shall cover any liability incurred in respect of any accident up to the following limits, namely:
(a) save as provided in Clause (b), the amount of liability incurred;
(b) in respect of damage to any property of a third party, a limit of rupees six thousand:
Provided that any policy of insurance issued with any limited liability and in force immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier.
(3) A policy shall be of no effect for the purposes of this Chapter unless and until there is issued by the insurer in favour of the person by whom the policy is effected a certificate of insurance in the prescribed form and containing the prescribed particulars of any condition subject to which the policy is issued and of any other prescribed matters; and different forms, particulars and matters may be prescribed in different cases.
(4) Where a cover note issued by the insurer under the provisions of this Chapter or the rules made thereunder is not followed by a policy of insurance within the prescribed time, the insurer shall, within seven days of the expiry of the period of validity of the cover note, notify the fact to the registering authority in whose records the vehicle to which the cover note relates has been registered or to such other authority as the State Government may prescribe.
(5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons.
'Any Person'
Any person as used in the Act here refers to person who on account of the acts of the negligent operation or negligent or rash driving of the motor vehicle carrying passengers or carrying goods dies or suffers injury or is injured as a result of negligent driving of the motor vehicle. It may be a person riding or travelling in the vehicle either as a passenger or under the Rules provide permitting of such person to travel. It may also include in itself the pedestrians who are adversely affected, i.e., injured and died or injured as a result of motor accident caused by the rash and negligent driving of the motor vehicle by the insured or his employee. This section is contained under Chapter XI and bears title 'Insurance of Motor Vehicles Against Third Party Risks' so no doubt it may be said that it does not include the insured or his heirs whose vehicle has been got insured against the third party liability. Reference may be made in this connection to the decision of City of Providence v. Paine, 103 A 786, 788, 41 RI 333 and to the 'Words and Phrases', Permanent Edn., Vol. 3A, p. 173. It may also include persons authorised to be carried in the vehicles concerned. It will definitely include the persons authorised to be carried in the vehicles concerned.
9. It will also be profitable to refer to the provisions of Section 95 particularly Sub-sections (1) and (2) of Motor Vehicles Act, 1939. This section reads as under:
Section 95. Requirements of policies and limits of liability.-(1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-
(a) is issued by a person who is an authorised insurer or by a co-operative society allowed under Section 108 to transact the business of an insurer, and
(b) insures the person or classes of persons specified in the policy to the extent specified in Sub-section (2)-
(i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place:
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 in the vehicle, or
(c) if it is a goods vehicle, being carried in the vehicle, or
(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, or
(iii) to cover any contractual liability.
Explanation.-For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place.
(2) Subject to the proviso to Sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely-
(a) where the vehicle is a goods vehicle, a limit of one lakh and fifty thousand rupees in all, including the liabilities, if any, arising under the Workmen's Compensation Act, 1923, in respect of the death of, or bodily injury to, employees (other than the driver), not exceeding six in number, being carried in the vehicle;
(b) 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,-
(i) in respect of persons other than passengers carried for hire or reward, a limit of fifty thousand rupees in all;
(ii) in respect of passengers, a limit of fifteen thousand rupees for each individual passenger;
(c) save as provided in Clause (d), where the vehicle is a vehicle of any other class, the amount of liability incurred;
(d) irrespective of the class of the vehicle, a limit of rupees six thousand in all in respect of damage to any property of a third party.
10. In Section 147 as originally enacted, the expression 'Including the owner of the goods or his authorised representative carried in the vehicle' was not there. This expression really came to be added later on by Act of 1994. Really the expression 'injury to any person including the owner of the goods or his authorised representative in the vehicle' was placed by way of substitution for the words and expression 'injury to any person' as originally used in Sub-section (1) of Section 147. It is to be examined whether the Sub-section (1) of Section 147 as it existed prior to its amendment by Act of 1994 included in itself the owner of the goods and the amendment was nothing but an amplification or explanation of what had already been contained within this phrase. The expression 'any person' is a term of wide connotation. It has to be interpreted in the context of other provisions or other parts of the section. With reference to the goods vehicle it may be said that 'any person' cannot be interpreted in vacuum. Any person here means any person authorised to be carried or entitled to travel in the motor vehicle. With reference to the public carnage or stage-carriage permits it may include the passengers in ordinary sense but it is not the same with respect to the goods vehicles. Goods vehicles are primarily meant for transportation of or for carrying the goods and as per rule and the general and ordinary rule is that no person shall travel in a goods vehicle. Proviso to rule framed under the Act clearly provides exception to the general principle that no person shall be carried in a goods vehicle. There are exceptions and that is provided by the proviso to Rule 100 of Karnataka Motor Vehicles Rules of 1989.
This rule is similar to Rule 161 of the Karnataka Motor Vehicles Rules of 1963, under which it is provided that the owner or the hirer of the vehicle can be carried free of charge or a police officer in uniform travelling on duty may be carried in goods vehicle. Thus proviso explains with reference to the owner or hirer or their employees that they or any of them may be carried in the goods vehicle, if they are carried free of charge in the sense that no travelling or hiring charges are to be taken from them apart from charges of transportation of goods. In Sub-section (2) of Section 147 which has been quoted earlier, Clause (b) is also relevant and needs to be taken into consideration in interpreting the expression 'any person' as used and as existed in the Act with Section 147(1). Sub-Section (2) deals with the extent of liability incurred which has been specified under Clause (a) to be, save as provided under Clause (b), the amount of liability incurred. While Clause (b) provides for and deals with statutory liability as for damages to any property of a third party and its limit is to the extent of Rs. 6,000. This Clause (a) of Sub-section (2) is a development and modification in its contents, language, nature, scope and Section 95 (2) (a) quoted above reveals that with reference to the liability and extent of liability, it had divided the vehicles in two separate categories or separate parts and has made provision under two heads as Clause (a) and Clause (b). With reference to goods vehicles vide the Clause (a) and vehicles other than goods vehicles vide the Clause (b) and it specifically provided with reference to goods vehicles that the liability in case of goods vehicle will be limited to a sum of Rs. 1,50,000 in all including the liabilities arising under Workmen's Compensation Act, 1923 in respect of death of or bodily injury to employees other than driver not exceeding six in number being carried in vehicle while with reference to the vehicles meant for taking passengers provision separately had been made in Clause (b) of Sub-section (2). Clause (a) of Section 95 (2) did throw a light on the question of interpretation of expression 'any person' with reference to the goods vehicle and it was interpreted as it did not ordinarily include any person other than the driver and the employees, be the employees of the owner of the vehicle or the hirer and the extent of liability was indicated by the use therein of expression 'arising under the Workmen's Compensation Act' Clause (a) of Sub-section (2) of Section 147 having been completely overhauled and it appears to be taking in its scope both types of vehicles. Clause (a) only provides the amount of liability incurred which leads me to the conclusion that 'any person' used in Section 147(1)(b) meant and included in itself all or every person who under law, i.e., Act or the Rules framed under the Act has been entitled or authorised to be carried in a vehicle, i.e., in case of a goods vehicle if and when the provisions made under the Rules, permit that not only employees but the owner or the hirer or the bona fide employee of owner or hirer of vehicles while transporting the goods can be carried with, free of charge or a police officer in uniform travelling on duty can be carried in a goods vehicle but the total number thereof should not exceed the one prescribed. The expression 'any person' used in Section 147(1) of the Act of 1988 included in itself the owner of the goods, the hirer of the vehicle for transportation of goods or the employees thereof as well as the police officer in uniform travelling on duty as well as pedestrian, injured or dead as a result of accident in course of user of motor vehicle by the insured or his employees on or in a public place. Thus this section as amended by Act No. 54 of 1994 and as it stood in Section 147(1) of the Act, in my opinion, included the owner of the goods and even pedestrian, if he is injured or dies as a result of motor accident caused due to motor accident be it a goods vehicle or a stage carriage permit. Substitution of the expression 'injury to any person including the owner of the goods or his authorised representative carried in the vehicle' in place of expression 'injury to any person' is nothing new but only an amplification of or making something more explicit which was contained in the expression to any person used in Section 147(1)(b)(i). In my opinion, the amendment is only explanatory and mere revelatory of the legislative intent which existed when it enacted the Act originally or the provisions of Section 147 of the new Act, even prior to its amendment. In my opinion the Amending Act No. 54 of 1994 was not intended to bring out a change of law but it was meant to make explicit what has been contained in Section 147 originally enacted for due interpretation of provisions of Section 147(1)(b)(i) read with 147(2)(a) It is well settled and recognised principle of interpretation that a subsequent legislation may be looked at in order to arrive at the proper interpretation and the one which fulfils the object of the Act has to be adopted. Thus considered even earlier to enforcement of Amending Act No. 54 of 1994 'any person' or injury to any person included the owner of goods, hiring the vehicle as well. This interpretation does not amount to giving of retrospectively to amendment at all instead it is only following and giving effect to what has been contained in originally enacted Section 147 as amplified and explained by Amending Act by revealing legislative intent behind the use of language or expression in original section. When I so observe I find support from the following decisions and reference may be made and reliance may be placed on the decisions of their Lordships of Supreme Court in the cases of:
(a) State of Bihar v. S.K. Roy, : 1966CriLJ1538 ;
(b) Kajarilal v. Union of India, AIR 1966 SC 1538 (para 14);
(c) Kajarilal v. Union of India, : AIR1996SC2155 .
In the case of State of Bihar v. S.K. Roy, : 1966CriLJ1538 , their Lordships have laid it down as under:
In our opinion, the change in the language of Section 2 (b) of the earlier Act brought about by the Amending Act (Act 45 of 1955) was not meant to bring about a change of law in this respect but was meant to fix a proper interpretation upon the earlier Act. It is a well recognised principle in dealing with matters of construction that subsequent legislation may be looked at in order to see what is the proper interpretation to be put upon the earlier Act where the earlier Act is obscure or ambiguous or is readily capable of more than one interpretation [See Ormound Investment Co. Ltd. v. Belts, 1928 AC 143 at 156].
That the decision given by the Full Bench, in the case of National Insurance Co. v. Dundamma, : ILR1991KAR2045 , relied on by learned Counsel for respondent relates to interpretation of Section 95 of the Act of 1939 and that view of the Full Bench as expressed is based on the language of Section 95 (1) and (2) of the Act of 1939 and has been in the context of the language of that section. In para 27, their Lordships observed:
(27) The wording of the proviso to Section 95 (1) (b) indicates that as far as employees travelling in a vehicle, such as a person driving a vehicle, conductor or ticket examiner in a public service vehicle, and employees carried in a goods vehicle, the risk is required to be compulsorily covered, though in view of Section 95 (2) (a) such compulsory coverage of risk in respect of goods vehicle is restricted to six. As far as any other person travelling in a vehicle by reason of or in pursuance to a contract of employment, such travelling could be only in a vehicle in respect of which permit is secured to carry passengers for hire or reward. To illustrate, a stage carriage or contract carriage which includes a motor cab might be engaged by any employer for providing free conveyance to his employees from their residence to the place of work and vice versa. In such a situation also though employees do not pay any hire, as their travelling in such a vehicle is by reason of or pursuant to a contract of employment, the risk in respect of death of or bodily injury to such person, resulting from an accident is also required to be compulsorily covered in view of Sub-clause (ii) of the proviso to Section 95 (1) (b) of the Act. Whatever that may be, passengers travelling in a goods vehicle, other than employees, are not required to be covered by a policy issued in terms of Section 95 of the Act, by the force of Clause (ii) of the proviso to Section 95 (1) (b) of the Act.
It was on the basis of reading of Section 95 (1) (b) read with Section 95 (2) (a), the Full Bench expressed the view that the owner of the goods in respect of whom the liability could be fastened against insurance company in respect of cases arising prior to 1.7.1989, should be persons who have entered into an agreement with the owner of the vehicle for carrying goods and the goods carried should be those as defined in Section 2(7) of the Act. The Full Bench has clarified that with reference to cases arising prior to 1.7.1989, if owner of goods is carried in the vehicle and in respect of whom liability can be fastened on the insurance company, those persons should have entered into an agreement with the owner for carrying the goods. Anyway even under rule of law of 'Stare Decisis', the Full Bench has taken the view that in respect of owner travelling in the goods vehicle with his goods, the liability may be fastened on the insurance company with reference to death or injury being caused to such persons on the basis of stare decisis. So the Full Bench also did not all together rule out that in cases where the owner of the goods travels in the goods vehicle along with his goods, after having hired the goods vehicle for the purpose of transportation of goods, if on account of some accident death or injury is caused to such a person, and the owner of the vehicle under the decree becomes liable to pay the compensation, then the liability of the company will also be there as that of the owner of the vehicle. The law laid down by the Full Bench very clearly provides that the law laid down with reference to other passengers travelling in the goods vehicle is restricted to passengers travelling in the goods vehicle other than the owner of the goods. In para 29, the Full Bench observes:
They, however, do not dispute that right from 1979 till now as far as the owner of the goods travelling in the vehicle is concerned, the insurance companies have been required to pay and have been paying the compensation in view of the ratio of the judgment in Channappa's case, : AIR1979Kant93 .
Thereafter, their Lordships have further observed dealing with the doctrine of stare decisis:
Therefore, we restrict the answer to the passengers travelling in a goods vehicle other than the owner of the goods.
The decision of the Full Bench, in my opinion does not lay down anything to the contrary with reference to Section 95, as far as the case of owner of the goods has been concerned and followed the law laid down earlier in the case of Channappa v. Laxman, : AIR1979Kant93 .
In view of the fact that change in the language of Section 147(2)(a) of the Act of 1988, from that of Section 95 (2) (a) of the Act of 1939, that is, old Act and attention of the Division Bench in the case of Oriental Insurance Co. Ltd. v. Irawwa, : AIR1992Kant321 , not having been invited thereto, which had material bearing on the interpretation of Section 147(1) of the Act, as well as subsequent amendment clarifying the position of law in the context of language used in Section 147(1)(b), with reference to 'any person' as including the owner of the goods or authorised agent carried in the vehicle, within the framework of the expression 'any person', the view expressed in the case of Oriental Insurance Co. Ltd. v. Irawwa (supra), may not be said to be binding as a precedent as it suffers from doctrine of per incuriam.
In this view of the matter, in my opinion, under Section 147(1) of the Act of 1988, the policies may be said to compulsorily cover the liability in respect of death of or injury to the owner of the goods or his authorised representative carrying the goods in the vehicle, even without payment of any extra coverage, but not in respect of other passengers, that is, in other words compulsory coverage of risk under the policy, as per Section 147(1) covers within itself the liability arising with reference to death of or injury to the owner of goods or hirer of the goods vehicle for transportation of goods, the employees of the owner of vehicle or employees or representative of the hirer/owner of the goods being carried with the goods in the goods vehicle, subject to the extent of limit of six persons, in addition to the driver of goods vehicle.
It is well settled principle of law, that if two interpretations are possible, the one which subserves the purpose and object of the Act and the provision, must be adopted. The purpose of the provision for compulsory insurance or making provision for insurance of the vehicle, compulsory insurance is for the benefit of the injured or dependant of the deceased-one who is injured due to motor accident, whether by goods vehicle or by a public carriage. It is not the object of the Act or the provision relating to compulsory insurance that more profit and more business be provided to the insurance company. The purpose is that the dependants of the deceased dying on account of motor accident or in a motor accident or the persons injured may get real compensation and compensation at the earliest without difficulties and undue harassment or trouble being caused in realisation. This has well been explained by their Lordships of the Supreme Court in the case of Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan, 1987 ACJ 411 (SC), vide para 13 of the report, where their Lordships observe as under:
(13) In order to divine the intention of the legislature in the course of interpretation of the relevant provisions there can scarcely be a better test than that of probing into the motive and philosophy of the relevant provisions keeping in mind the goals to be achieved by enacting the same. Ordinarily it is not the concern of the legislature whether the owner of the vehicle insures his vehicle or not. If the vehicle is not insured any legal liability arising on account of third party risk will have to be borne by the owner of the vehicle. Why then has the legislature insisted on a person using a motor vehicle in a public place to insure against third party risk by enacting Section 94. Surely the obligation has not been imposed in order to promote the business of the insurers engaged in the business of automobile insurance. The provision has been inserted in order to protect the members of the community travelling in vehicles or using the roads from the risk attendant upon the user of motor vehicles on the roads. The law may provide for compensation to victims of the accidents who sustain injuries in the course of an automobile accident or compensation to the dependants of the victims in the case of a fatal accident. However, such protection would remain a protection on paper unless there is a guarantee that the compensation awarded by the courts would be recoverable from the persons held liable for the consequences of the accident. A court can only pass an award or a decree. It cannot ensure that such an award or decree results in the amount awarded being actually recovered from the person held liable who may not have the resources. The exercise undertaken by the law courts would then be an exercise in futility. And the outcome of the legal proceedings which by the very nature of things involve the time cost and money cost invested from the scarce resources of the community would make a mockery of the injured victims, or the dependants of the deceased victim of the accident, who themselves are obliged to incur not inconsiderable expenditure of time, money and energy in the litigation. To overcome this ugly situation the legislature has made it obligatory that no motor vehicle shall be used unless a third party insurance is in force. To use the vehicle without the requisite third party insurance being in force is a penal offence. The legislature was also faced with another problem. The insurance policy might provide for liability walled in by conditions which may be specified in the contract of policy. In order to make the protection real, the legislature has also provided that the judgment obtained shall not be defeated by the incorporation of exclusion clauses other than those authorised by Section 96 and by providing that except and save to the extent permitted by Section 96, it will be the obligation of the insurance company to satisfy the judgment obtained against the persons insured against third party risks [vide Section 96]. In other words, the legislature has insisted and made it incumbent on the user of a motor vehicle to be armed with an insurance policy covering third party risks which is in conformity with the provisions enacted by the legislature. It is so provided in order to ensure that the injured victims of automobile accidents or the dependants of the victims of fatal accidents are really compensated in terms of money and not in terms of promise. Such a benign provision enacted by the legislature having regard to the fact that in the modern age the use of motor vehicles notwithstanding the attendant hazards, has become an inescapable fact of life, has to be interpreted in a meaningful manner which serves rather than defeats the purpose of legislation. The provision has, therefore, to be interpreted in the twilight of the aforesaid perspective.
As mentioned earlier, it is well settled in case of social, economic and beneficial provision if two interpretations are possible, the one fulfilling the purpose and beneficial to the person for whose beneficial interest it has been enacted should be adopted. Reference may be made to the decision of their Lordships of the Supreme Court in the case of Bharat Singh v. Management of New Delhi Tuberculosis Centre, New Delhi, : (1986)IILLJ217SC . Dealing with Section 17-B of Industrial Disputes Act, their Lordships observed:
(11) Section 17-B on its terms does not say that it would bind awards passed before the date when it came into force. The respondent's contention is that a section which imposes an obligation for the first time cannot be made retrospective. Such sections should always be considered prospective. In our view, if this submission is accepted, we will be defeating the very purpose for which this section has been enacted. It is here that the court has to evolve the concept of purposive interpretation which has found acceptance whenever a progressive social beneficial legislation is under review. We share the view that where the words of a statute are plain and unambiguous effect must be given to them. Plain words have to be accepted as such but where the intention of the legislature is not clear from the words or where two constructions are possible, it is the court's duty to discern the intention in the context of the background in which a particular section is enacted. Once such an intention is ascertained the courts have necessarily to give the statute a purposeful or a functional interpretation. Now, it is trite to say that acts aimed at social amelioration giving benefits for the have-nots should receive liberal construction. It is always the duty of the court to give such a construction to a statute as would promote the purpose or the object of the Act. A construction that promotes the purpose of the legislation should be preferred to a literal construction. A construction which would defeat the rights of the have-nots and the underdogs and which would lead to injustice should always be avoided. This section was intended to benefit the workmen in certain cases; It would be doing injustice to the section if we were to say that it would not apply to awards passed a day or two before it came into force.
The addition of expression 'including the owner of the goods or his representative carried in the goods vehicle' as observed earlier, has only been explanatory in a manner of what has been contained in Section 147(1) of the Act of 1988. The purpose of the amending provision appears to clarify that position and to make the principle that has been followed since long, that is, from 1979 to 1990 that owner of the goods carried in the goods vehicle along with the goods was taken to be covered under the compulsory coverage, more explicit as contained and enshrined in unamended Section 147 of the Act. That material difference in the language of Clause (a) of Section 147(2) in the Act of 1988 is distinct from that of Section 95 (2) (a) of the Act of 1939, along with the use of expression 'any person' in Clause (a) of Section 147(1) of the Act of 1988, is more expressive of above intent of the legislature as well. But even then when some contrary view was expressed, the legislature enacted Motor Vehicles (Amendment) Act, 1994 and substituted the expression 'injury to any person, including owner of the goods or his authorised representative carried in the goods vehicle'. The interpretation which I have placed, appears to me purposeful and to be serving the purpose and the object with which Section 147 of the Act of 1988 appears to have been enacted and subserves the basic cause and object to fulfil which position was clarified by Act No. 54 of 1994, by substitution of the expression as mentioned above, which is beneficial to the subject, for the benefit of which it had been enacted. Thus considered, in my opinion under Section 147(1) of the Act of 1988, coverage of the liability arising with reference to the owner of the goods is covered by way of compulsory statutory coverage.
On behalf of the insurance company, my attention had been invited to I.M.T. 14 (b) mentioned under the heads 'Conditions' and 'Endorsements' of the policy, and it had been argued by the learned Counsel for the respondent that liability at the most of the company with respect to any one passenger has been limited to the extent of Rs. 10,000 while in respect of one accident with reference to NFPP has been Rs. 10,000 for which a premium of Rs. 36 had been deposited. This contention of the learned Counsel for the respondent had been disputed by the counsel for the appellant who had pressed the contention that the liability had been unlimited. I.M.T. 14 (b) under the head 'Endorsements' reads as under:
I.M.T. 14 (b). Legal liability to authorised non-fare paying passengers who are not employees of the insured: In consideration of the payment of an additional premium as stated in the Schedule and notwithstanding anything to the contrary contained in Section II '(c)' is hereby understood and agreed that the company will indemnify the insured against his legal liability under the statute (except Fatal Accidents Act, 1855) in respect of death of or bodily injury to any person not being an employee of the insured nor carried for hire or reward, provided the person is-
(a) Owner or the representative of the owner of the goods;
(b) Charterer or the representative of the charterer of the truck;
(c) Any person directly connected with the journey in one form or another.
Whilst being carried in or upon or entering or mounting, alighting from the motor vehicle, but such indemnity is limited to the sum as mentioned in the Schedule in respect of any one such person and subject to the aforesaid limit in respect of any one person to the sum as mentioned in the Schedule in respect of any number of claims in connection with any one of such vehicle arising out of one cause subject otherwise to the terms, exceptions, conditions and limitations of this policy.
Section II, bearing head 'Liability to Third Parties' containing the conditions read as under:
(1) Subject to the limits of liability, the company will indemnify the insured against all sums including claimant's cost and expenses which the insured shall become legally liable to pay in respect of-
(i) Death of or bodily injury to any person caused by or arising out of the use (including the loading and/or unloading) of the motor vehicle;
(ii) Damage to the property caused by the use (including the loading and/or unloading) of the motor vehicle.
My attention has been invited by the learned Counsel for the appellant who had pressed for the unlimited liability, to the Schedule and to the premium for increased third party liability under Section I (i)- death of or bodily injury to any person caused by or arising out of use of motor vehicle, the liability column mentions unlimited liability, while Section I referring to third party, refers to damage to the property of the third party limit of liability as Rs. 3,00,000.
The expression 'third party' has been defined in Section 145(g) of the Act of 1988, as under:
145(g) 'Third party' includes the Government.
This definition is illustrative, to say it includes the Government. The expression 'Third party' has been defined in the Black's Law Dictionary, 5th Edn. at p. 1327 to mean:
Third party: One not a party to an agreement or to a transaction but who may have rights therein.
In the context of insurance and the provisions of this Motor Vehicles Act, third party will mean a party other than insurer and the insured (including persons connected with the insured) to an insurance policy or contract of insurance. Insurance is taken for the benefit of third party as well in case of motor vehicles; motor vehicles are required to be insured for the benefit of the third parties who may get benefit of insurance, in the sense that in case of accident taking place causing damage, death or other injuries, for a person other than those who are parties to the contract of insurance, that is, who are other than the insurer and the insured, that they may be able to realise the compensation by earliest process of insurance. A person who is a passenger may be a third party with reference to vehicles ordinarily used for conveyance or one who is carried in a goods vehicle with the goods transported by him or by his motor vehicle, may also come within the framework of the expression 'third party' in the context of Sections 145(g) and 146 of the Act of 1988.
No doubt in the policy with reference to third party limits, with reference to the death of or bodily injuries to any person caused, arising out of the use of motor vehicle, it is mentioned that liability is unlimited, but so far as any person who may be a third party, but who comes within the framework of the expression 'non-fare paying passenger', the Schedule to the premium indicates the limit of liability with respect to any one passenger is Rs. 10,000 while limit with respect to one accident involving such passengers who may be called 'non-fare paying passengers', the total liability is mentioned to be Rs. 50,000 only. Cleaners and coolies are separately mentioned. With reference to 'non-fare paying passengers' the premium paid is indicated as Rs. 36. So in such a case, the position falls out to this, that even though the deceased who was travelling with the goods in the goods vehicle, which goods had to be transported on that lorry, he cannot be said to be travelling in an unauthorised manner, he also cannot be termed to be a simple gratuitous passenger, instead he was one who was travelling with the goods which have been transported by him on the vehicle along with the goods. The limit of liability of the insurance company with respect to such person has been specified as limited one, with respect to an individual person so travelling as Rs. 10,000 and with respect to such person so travelling more than one, in total Rs. 50,000. In my opinion, there is no force in the contention of the appellant that the liability of the insurance company in such a case was unlimited one. No doubt such a passenger or such a person who is carried in the goods vehicle may be said to be a third party, as he is a party other than the insurance company and the insured, but when with reference to such a party it has been specifically indicated in the policy that the liability is limited to the tune of Rs. 10,000.
In my opinion, the Tribunal has been justified in holding that insurance company is liable to pay Rs. 10,000 out of the total compensation awarded, while the balance of Rs. 1,37,000 is and shall be payable with reference to the deceased Sundar alias Gangasundar (sic. by the owner of the lorry). As such, in my opinion, the Tribunal was justified in holding, while making an award that the National Insurance Co. Ltd. which is present respondent No. 5 and who was respondent No. 1 in the claim petition shall be liable to pay and deposit Rs. 10,000 with proportionate costs and interest and respondent No. 2 in the claim petition, namely, owner of the lorry (present appellant) shall be liable to pay and deposit a sum of Rs. 1,37,000 with proportionate costs and interest, does not suffer from any error of law or of fact. Thus considered in my opinion the appeal has got no force and is finally dismissed.
Costs of the appeal are made easy.