C.P. Sen, J.
1. This Full Bench has been constituted for resolving the conflict between the two Division Bench decisions of this Court in South India Insurance Co. Ltd., Indore v. Heerabai 1967 Acc CJ 65 and Patharibai v. Firulalji Shankarlal AIR 1985 Madh Pra 103. Though the learned single Judge had requested the Hon'ble the Chief Justice for constituting an appropriate Bench for disposal of the appeal but only the question has been referred for decision. This opinion will also govern the following question referred in Ramsingh v. Smt. Shantiba (M.F.A. No. 181/81):
Whether the owner/agent of the goods accompanying the goods and travelling in the goods-vehicle which met with an accident in which owner/agent of the goods sustained fatal injuries, would be deemed to be a passenger who was being carried for hire or reward or not, within the meaning of Clause (ii) of the proviso to Clause (b) of Sub-section (1) of Section 95 of the Motor Vehicles Act?
2. In Misc. First Appeal No. 124/1981 the appellant is the owner of truck No. MPS 9555. Respondent No. 4 was the driver and the vehicle was insured with the respondent No. 5- Insurance Company. The respondents 1 to 3 are the claimants being sons and widow of deceased Laxman Sahu who loaded some bags of grain in the truck for carrying to market and himself travelled with the goods from Amlidih to Bhatapara. Near Simariapara, the truck turned turtle as a result Laxtnan Sahu died. Claim was preferred by his legal representatives. The Claims Tribunal found the driver to be rash and negligent in driving the truck and awarded compensation of Rs. 8000/- but held that the Insurance Company was not liable as the deceased was not travelling in pursuance of any contract of employment.
3. In Misc. F. Appeal No 181/81 the appellant is the owner of truck No. HRJ 1380 which was insured with respondent No. 5 Insurance Company and was driven by respondent No 6 at the relevant times. The truck was coming from Haryana carrying 6 buffaloes belonging to one Kawar Singh. Deceased Mangal was travelling with the buffaloes in the said truck as care-taker on behalf of owner of the buffaloes. It has come in evidence that Mangal was acting as a caretaker for transporting of buffaloes on behalf of several hirers who were transporting buffaloes by truck and he was receiving remuneration for the job. Therefore, clearly he was acting as an employee of the hirer and even if not an employee, he was a representative of the hirer to take care of the buffaloes. On 9-7-1977 at about 5pm. the truck overturned near village Agri Tahsil Bemetara, as a result the buffaloes and the occupants of the truck including Mangal were thrown out. Mangal sustained serious injuries and succumbed after 2 months. His widow and minor children filed the present claim case. The Tribunal found the driver to be rash and negligent and awarded compensation of Rs 15,200/-against the owner and driver of the truck but held that the Insurance Company was not liable as the deceased was not covered by the terms of the policy since he was not travelling in pursuance of a contract of employment.
4. Section 94 of the Motor Vehicles Act makes insurance against third party risk compulsory in respect of all motor vehicles used in a public place.
5. Section 95 provides that in order to comply with the requirements of Chap. VIII of the Act, a policy of insurance must be (a) issued by an authorised insurer and (b) policy must insure the person or classes of persons specified in the policy to the extent specified in Sub-section (2). For ready reference it will be useful to quote Clause (b) of Sub-section (1) of Section 95:
Section 95(1 Kb): 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, 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 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.
It is clear that the insurance policy must cover (i) against any liability which may be incurred by the insurer in respect of the death or bodily injury to any person or damage to any property of a third party and (ii) against the death 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 (i) a policy shall not be required to cover any liability in respect of death or bodily injury to any employee other than the liability arising under the Workmen's Compensation Act, 1923, in respect of (a) driver of the vehicle, (b) conductor of a public service 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 so carried, or (iii) to cover any contractual liability. So it is evident that the section requires that the policy must cover against any liability in respect of death or bodily injury to any person or damage to any property, except passengers in the public service vehicle, driver of any vehicle or the conductor of a public service vehicle or a person being carried in a goods vehicle for transporting goods, no other passenger. So while any third party i.e. one who is not an occupant of the vehicle, is covered under the policy but all occupants of the vehicle are not so covered except those specified aforesaid in the sub-section. The question which remains for consideration is if the hirer of a goods vehicle or his employee travels with the goods and the vehicle met with an accident and the hirer or employee dies or receives bodily injury, whether the insurance company is liable to cover this risk.
6. The hirer of a goods vehicle or his employee cannot come under the first proviso but can only come under the second proviso i.e. if they are either passengers carried for hire or reward or by reason of or in pursuance of a contract of employment. Goods vehicle is defined under Section 2(8) of the Act as vehicles constructed or adapted for use for the carriage of goods or any motor vehicle not so constructed or adapted when used for the carriage of goods, solely or in addition to passengers. From this definition it would be clear that a goods vehicle can be a vehicle meant to carry passengers also. Rule 111 of the M.P. Motor Vehicles Rules provides that no person shall be carried in the cab of a goods vehicle beyond six persons in addition to the driver. Therefore, the rule also provides that in addition to driver six more persons can be carried as passengers in a goods vehicle, obviously as caretaker of the goods, or for loading and unloading purposes. So it cannot be said that carrying of passengers in a goods vehicle is totally prohibited. In fact, in the policies in both the cases there is a stipulation that the passengers carried for hire or reward or in pursuance of a contract of employment are covered under the policies and further in Misc. F. Appeal No. 124/81 the policy itself specified that six persons can be carried in the vehicle in question apart from the driver. We are of the opinion that the hirer while paying hire charges for carrying the goods in the vehicle and while he or his employee is required to travel with the goods for its safety in the vehicle, it will be deemed that the hirer was carried in the vehicle for reward while his employee was carried in the vehicle in pursuance of his employment. So the hirer and his employee both have to be covered under the insurance policy and the insurer is bound to pay compensation for the death or, bodily injury while the vehicle met with the accident.
7. A Division Bench of the Karnataka High Court in Channappa v. Laxman AIR 1979 Kant 93 held 'From this it would follow that the goods vehicle which carries the owner of the goods as a passenger can be construed as a vehicle in which passengers are carried for hire or reward as would answer the exception contained in the first part of the Second proviso so as to make the coverage of risk of such a person compulsory under Chap. VIII of the Act.' A Division Bench of the Kerala High Court in State Insurance Officer, Trivandrun v. Sosamm : AIR1979Ker15 held that a person travelling in goods vehicle for and on behalf of the owner of goods in pursuance of a contract of employment with the owner of the goods is covered by the policy of insurance against third party risks. A Division 8ench of the Allahabad High Court in Abdul Razak v. Smt.Sharifunnisan AIR 1983 All 400 following the aforesaid decisions held that the owner of goods or his employee travelling in goods vehicle along with his goods is also covered by third party risk and in case of death of the owner the insurer is liable to indemnify the owner. The risk is covered by the second proviso to Section 95(lXb) and the Act requires compulsory insurance. A Division Bench of the Orissa High Court in Oriental F. and G. Insurance Co. Ltd. v. Narayanibai : AIR1984Ori43 held that the owner of the goods accompanying the goods in a goods vehicle hired by him is a passenger who is being carried for hire or reward. A Division Bench of the Bombay High Court in Nasibdar v. Adhia and Co. : AIR1984Bom1 held that when a hirer of a goods vehicle for carriage of his goods is travelling by the said vehicle in connection with the carriage of the goods with the consent of the driver or owner of the goods vehicle in question, he must be deemed to be a passenger on the vehicle for reward with in the meaning of Clause (ii) of the proviso to Section 95(1) of the Act and hence the tortious liability of the owner towards him must be covered by the insurance policy contemplated by the said section. A Division Bench of this Court in Patharibai v. Firulalji Shankarlal AIR 1985 Madh Pra 103 (supra) held that on a plain reading of the language of Section 95(l)(b), Proviso (ii)it seems that the coverage of risk is extended to all those who are required of necessity to be on the insured vehicle by reason of or in pursuance of contract of employment and the employer having not been specified therein there is no reason to put a limitation that the benefit of coverage of risk is intended only for those who are in the employment of the insured owner of the vehicles. G.P. Singh, C.J. in Sardar Jagdish Singh v. Mst. Sushilabai and ors. M.F.A. No. 318/77 decided on 20-8-1981 held that the truck had been engaged by Chainsingh for transporting 40 bags of wheat. Chainsingh and his son Bharat Kumar were sitting on the top of the loaded truck in order to see that the goods are safely transported. The truck overturned resulting in the death of Chainsingh and injury to Bharatkumar. Although both of them were not travelling for hire or reward on the truck but the insurance company was liable as they had to travel in the truck for the safe transport of goods. A Full Bench of the Rajasthan High Court in Santra Bai v. Prahlad held that 'insurer is liable to indemnify the owner of the goods, when he receives bodily injury or death while accompanying the goods or without goods in a goods vehicle which he hires from the owner of the vehicle Rule 133 of the rules permits the carrying of persons in a goods vehicle also subject to limitation of number of persons and seating capacity etc. The Legislature has not used the words 'public service vehicle' in the above clause and this clearly shows that a goods vehicle will also come within the purview of this clause if passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment even in goods vehicle. However, a Division Bench of the Andhra Pradesh High Court in Meesala Suryanarayana v. Goli Satyavathi 1979 Acc CJ 513 held that the owner of the goods travelling in the goods vehicle is covered under the contract of employment. Though Karnataka, Allahabad, Bombay and Orissa High Courts have not gone to that extent and. they have only held that the owner of goods vehicle falls within the purview of being carried for reward. In our view also, the owner of the goods cannot be said to be carried by reason of or in pursuance of the contract of employment. The owner of the goods can only fall within the purview of passenger carried for reward.
8. But there are decisions to the contrary. A Division Bench of this Court in South India Insurance Co Ltd. v. Heeraba 1967 Acc CJ 65 held that if a person hires a vehicle for carrying goods and himself or his agent travels in it, which may be permissible under the rules, and either dies or receives injury as a result of an accident caused by the driver thereof, the case will not be covered by the terms of the policy and he or his heirs will not be entitled to any compensation from the insurer as neither of them travelled in pursuance of any contract of employment. It may be mentioned that R. 111 of the M.P. Motor Vehicles Rules, 1974, was not framed at that time. Following this decision, a single Bench of this Court in Amar Singh v. Suraj~ mal 1981 Acc CJ 382 took the same view. Similar views has also been taken in New India Assurance Co. v. Mehrunnisa 1983 Jab LJ (SN) 21. In all those cases it has not been considered that the hirer of the goods vehicle travelling with the goods in the vehicle can be covered within the purview of a passenger carried for hire or reward and so the risk has to be covered by the policy. There are certain Division Bench decisions of this Court which are clearly distinguishable. The following cases were in respect of gratuitous passengers travelling in a goods vehicle and, therefore it was held that their risk is not covered under the policy issued Under Section 95 (Mangubai v. Kishan, Abdul Salam v. Kishan 1981 (2) MPWN (SN) 193 and 226; Thakurbai v. Virath Rustamji Patel 1983 MPWN (SN) 355).
9. A Full Bench of the Punjab High Court in O.F. & G. Insurance Co. v. G. Kaur AIR 1967 Punj 486 has held that 'the normal and the ordinary meaning and scope of the expression 'a contract of employment' points to a person being employed to do something or to carry out something for another person. It has the element of rendition of some service in one shape or another for the employer. So it cannot refer to the hiring of a goods carrier as a contract of employment or to the owner of such a carrier as the person with whom a contract of employment has been made So the policy was not one that was required to cover the liability under Clause (b) of Sub-section (1) of Section 95.' Similar view has been taken in C. Narayanan v. M S.P.G. Sammelan : AIR1974Mad281 Hindustan Ideal Insurance Corpn. Ltd. v. Manne Chimparamma : AIR1974AP120 and M. Kanda Swamy v. Chinnasvamy : AIR1985Mad290 . But all these cases are distinguishable because in all these cases the only point considered and decided was that the owner of the goods accompanying the goods in the truck cannot be said to b; travelling in the truck by virtue of any contract of employment, but the point that the owner of the goods accompanying the goods in the truck hired by him can be covered under the description 'passenger carried for hire or reward was not urged or considered in those cases. A Division Bench of the Gujarat High Court in Sakinabibi v. Gordhanbhai Prabhudas (1974) 15 Guj LR 428 had held that every passenger in the goods vehicle was likely to be covered by the insurance risk. The Supreme Court in Pushptbai v. Ranjit G. & P. Co. : [1977]3SCR372 held that it is not required that a policy of insurance should cover risk to the passengers who are not carried for hire or reward as under Section 95 the risk to a passenger in a vehicle who is not carried for hire or reward is not required to be insured. In a subsequent case, a Full Bencd of the Gajarat High Court in Anbaben v. Usmanbhai Amir-miya : AIR1979Guj9 after observing that the aforesaid Supreiiis Court decision has toned down and not overruled the earlier decision of the Gujarat High Court in Sakinabibi's case and held that the Gujarat High Court has gone to the extent in saying that the hirer of the goods vehicle for transport of his goods or other passengers would be covered by the insurance policy required to be taken Under Section 95. The Full Bench took the view that certain categories of passengers in goods vehicle would be covered by the insurance policy whereas the other categories of passengers need not be covered. The Gujarat High Court in another Full Bench decision in New India Assurance Co. Ltd v. Smt. Nathiben Chatrabhuj AIR 1982 Guj 116 held that when there is death or bodily injury to a passenger carried for hire or reward of an insured vehicle and accident occurred, the benefit of statutory insurance will not be available in respect of any such passenger if the insured vehicle was expressly or impliedly not covered by a permit to carry any passenger or the policy excluded carrying of any passenger. Therefore, the vehicle was used in breach of such specified condition.
10. Therefore, the question is answered in the affirmative that the Insurance Company is liable to cover the risk of a hirer/agent or his employee travelling with the goods in a goods vehicle under proviso (ii) of Clause (b) of Section 95(1) as a passenger carried for reward or by reason of or in pursuance of a contract of employment.
11. M.F.A. No. 181/81: For the reasons stated in the Opinion delivered by us today in Misc. First Appeal No. 124/81 (Harishankar Tiwari v. Jagru and Ors. the question is answered in the affirmative that the Insurance Company is liable to cover the risk of a hirer/agent or his employee travelling with the goods in a goods vehicle under proviso (ii) of Clause (b) of Section 95(1) as a passenger carried for reward or by reason of or in pursuance of a contract of employment.