D.H. Waghela, J.
1. The appeal under Section 173 of the Motor Vehicles Act, 1988 (for short, the Act) seeks to challenge order dated 18.06.2007 of M.A.C.T., Bhuj in M.A.C.P. No.556 of 2004 only on the ground that the claim under Section 163A of the Act could not have been allowed in favour of the heirs of the driver of sole vehicle involved in the accident. The appeal was restricted to the liability upto Rs. 2,82,834/- out of the award of Rs. 3,82,834/- (with interest and cost) in view of the fact that, admittedly, compensation of Rs. 1,00,000/- was covered by the personal accident insurance of the driver. The facts about which there is no controversy are that, on 05.06.2004, the deceased, driving scooter No. GJ-7-P-5487, dashed with the parapet of a bridge near village Anandsar in Kachchh district. The deceased aged 42 was claimed to be earning Rs. 40,000/- and his parents, widow and children claimed compensation under Section 163A of the Act. The scooter driven by the deceased was owned by respondent No.7 and insured by the appellant. Learned counsel Mr. Sunil B. Parikh, appearing for the appellant, vehemently argued that compensation could not legally be claimed by the heirs of the victim of the accident, who was himself solely responsible for the accident. He relied upon the Division Bench judgment dated 13.07.2005 of this Court in National Insurance Co. v. Rasilaben Shantilal Yadav Wd/o Late Shantilal Yadav and Ors. First Appeal No. 3354 of 2000 wherein the deceased was going on a scooter which was hit by a tanker which was not traceable. The Court observed that the claim should have been made against the driver, owner and insurance company of the tanker and in absence of their particulars, the claimants could claim compensation from the Collector of the district under Section 163 of the Act as a Shit and run case.
2. Having regard to the language and purport of the provisions of Section 163A, the owner of the motor vehicle or the authorised insurer has to be held liable to pay compensation in case of death or permanent disablement due to accident arising out of the use of motor vehicle. Therefore, the present case is apparently covered by the terms of Section 163A of the Act. Recently, this Court has, in First Appeal No. 2042 of 2007 and allied matters, on 16.01.2008, analyzed the scheme of the provisions and, after referring to and relying upon a series of relevant judgments of this Court and the Apex Court, held as under:
9. The scheme of the provisions relevant for interpretation and application of section 163A is fairly clear, although not very simple. Section 163A is engrafted into Chapter XI entitled 'Insurance Of Motor Vehicles Against Third Party Risks' and clearly provides for liability of the insurer to pay compensation, as indicated in the Second Schedule, notwithstanding anything contained in the Act or in any other law or instrument having force of law. Simply put, it creates an absolute liability of the owner of the motor vehicle as well as the authorised insurer in case of death or permanent disablement due to accident arising out of the use of motor vehicle. And, self-contained code as it is held to be in the liability should not depend upon or be subject to any other consideration under any other provision of law. That conclusion would be further buttressed by reading the relevant part of Sub-section (1) of Section 149 of the Act. That part, shorn of irrelevant or adjectival clauses, provides that if an award in respect of any liability required to be covered by the policy OR under the provisions of Section 163A is obtained against any person insured by the policy, the insurer shall, subject to the provisions of that section, pay to the other person entitled to the benefit of the decree, any sum not exceeding the sum assured payable thereunder, as if he were the judgment debtor.
9.1 Conjoint reading of Sections 149(1) and 163-A(1) would lead to the conclusion that liability to pay compensation under Section 163A arises directly against the authorised insurer as such and for obtaining an award in that regard so as to execute a decree as if the insurer were the judgment debtor, the provisions of Section 149 have to be complied. The fact, however, would remain that the liability under Section 163A is an independent statutory liability directly arising against the insurer.
9.2 Under the provisions of Section 146 of the Act, insurance is compulsorily required 'in relation to the use of the vehicle' and the policy has to compulsorily comply with the requirements of Chapter XI which includes provisions of Section 163A. However, the provisions in Section 149(1) creating a direct duty of the insurer to satisfy awards made under Section 163A is subject to the provisions of Sub-section (2) of Section 149 which provide for notice to and defences available for the insurer. That opportunity and availability of defences, however, are again subject to Sub-sections (4) and (5) and restricted by the provisions of Sub-section (7) of Section 149. According to Sub-section (4), once a certificate of insurance has been issued, so much of the policy as purports to restrict the insurance by reference to any condition other than those in Clause (b) of Sub-section (2) shall be of no effect; provided that any liability discharged by the insurer by virtue only of Sub-section (4) shall be recoverable by the insurer from any person whose liability was discharged. That would mean, even in case of breach of specified condition as enumerated in Section 149(2), liability has to be discharged by the insurer except where the policy was void on the ground of having been obtained by non-disclosure of material fact or by misrepresentation. Even if the liability incurred by the insurer exceeds the amount for which the insurer would be liable under the policy, the insurer will have to pay, but would be entitled to recover the excess from the insured. The insurer is, by Sub-section (7), expressly prohibited from avoiding his liability towards any person entitled to the benefit of an award made under Section 163A, otherwise than in the manner provided for in Sub-section (2) of Section 149.
9.3 Thus, as clearly held in National Insurance Co. Ltd. v. Swaran Singh (supra), insurer is entitled to raise defences in terms of Section 149(2) subject to such qualifications as are laid down in that judgment. Otherwise, the scheme of compulsory insurance 'in relation to the use of the vehicle' to insure against death, bodily injury or damage to any property of a third-party caused by or arising out of the use of the vehicle in a public place is wide enough to encompass 'any liability' in respect of 'any person'. Since the requirement of even pleading any wrongful act, neglect or default of the owner or any other person is expressly excluded by Sub-section (2) of Section 163A, the question of attributing negligence to any person, in proceeding under Section 163A, cannot be allowed to arise. As held by this Court in Bajaj Allianz General Insurance Co. Ltd. v. Belaben (supra), insurer's liability under Section 163A encompasses the liability to pay compensation on the basis of 'no fault principle' even in case of a driver who is alleged to be responsible for causing the accident in question. As held by another Division Bench of this Court in New India Assurance Co. Ltd. v. Muna Maya Basant (supra), by introduction of Section 163A, liability arising thereunder must now be deemed to have been covered under the statutory liability regardless of the pecuniary limit in that regard specified in the policy or premium charged. Thus, the limits of statutory liability has to be deemed to have been extended or enlarged appropriately so as to cover the liability that arises under Section 163A and, for that, extra premium is not to be charged or specific contract is not required to be entered into. These propositions of law supported by aforesaid statutory provisions and precedents binding on this court cover all the contentions of the appellants. The victim of the accident being the tort easer, pillion rider, employee of the insured or gratuitous passenger appears to be wholly irrelevant for the purposes of adjudication of a claim for compensation under Section 163A of the Act.
10. However, it was vehemently argued that very title of Chapter XI indicated that a scheme of compulsory insurance was provided against third-party risks and the title of the Second Schedule prescribed under Section 163A also provides for compensation for third-party claims which would not include the claims arising from death or injury to an employee, a driver, a pillion rider or a gratuitous passenger. The submissions in that regard were sought to be supported by the observations quoted hereinabove in Oriental Insurance Co. Ltd. v. Meena Variyal (supra), United India Insurance Co. Ltd. v. Tilak Singh (supra) and New India Assurance Co. Ltd. v. Asha Rani (supra). It was submitted that the cover of compulsory insurance provided by Chapter XI of the Act was only against third-party risks and 'any person' is to be understood as 'a third party', as held in the aforesaid judgments. And, as the provisions for compulsory insurance do not enjoin any statutory liability on the owner of the vehicle to get his vehicle insured for any passenger travelling in a goods vehicle, or gratuitous passenger in any other vehicle, their claim under Section 163A also need not be satisfied by the insurer. It must, however, be noted that the observations in Oriental Insurance Co. Ltd. v. Meena Variyal (supra), Dhanraj v. New India Assurance Co. Ltd. (supra), National Insurance Co. Ltd. v. Laxmi Narain Dhut (supra), and in United India Insurance Co. Ltd. v. Tilak Singh (supra), were not made with reference to the above aspect of the provisions of Section 163A of the Act; whereas the claims of compensation under Section 163A of the Act were under direct consideration of three Judge Bench of the Apex Court in National Insurance Co. Ltd. v. Swaran Singh (supra). In Meena Variyal (supra) itself it is observed that an obitur dictum of the Supreme Court is binding only in absence of a direct pronouncement on a particular question. The judgment in Laxmi Narain Dhut (supra) emphasises 'rule of legislative intent'. Interpretation must depend on the text and the context and the Court has to choose that interpretation which represents the true intention of the legislature. The enactment of Section 163A and amendment of Section 149(1) clearly marks a departure from the concept of insurer indemnifying the owner for the benefit and purpose of satisfying decrees obtained by third parties and breaks new ground by making the insurer directly liable to pay regardless of its liability under the policy of insurance. After the Amendment Act 54 of 1994, broadly two kinds of awards are required to be satisfied by the insurer under Section 149(1); viz. (i) 'awards in respect of any such liability as is required to be covered by a policy under Clause (b) of Sub-section (1) of Section 147 (being a liability covered by the terms of the policy) OR (ii)'under the provisions of Section 163A'. That addition of the alternative category of liability 'under the provisions of Section 163A' unequivocally makes such liability different from the liability covered by the express terms of the policy.
10.1 Even as late as in the year 2007, in Smt. Yallwwa and Others (supra), while considering the provision for 'no fault liability' under Section 140, it was observed that it made the owner of the vehicle liable, but not the insurer per se. As against that, by express language of Section 163A, insurer is made directly liable per se as discussed earlier. Therefore, keeping in mind the objectives and purpose for which the provisions of Section 163A are made, and made to supersede all other provisions of law, it has to be held that the claim for compensation by a third-party cannot be defeated by an insurer of the motor vehicle out of the use of which the accident had arisen and death or permanent disablement caused, except as indicated hereinabove. It may be pertinent to reproduce as under, the observations of Justice Frankfurter of the United States Supreme Court, as quoted in Paragraph 35 of National Insurance Co. Ltd. v. Laxmi Narain Dhut(supra):
35. Legislation has an aim, it seeks to obviate some mischief, to supply an adequacy, to effect a change of policy, to formulate a plan of Government. That aim, that policy is not drawn, like nitrogen, out of the air; it is evidenced in the language of the statutes, as read in the light of other external manifestations of purpose.
The observations of the Supreme Court in Mehboob Dawood Shaikh v. State of Maharashtra : 2004CriLJ1359 on application of precedent may be quoted as under:
12. ...A decision is available as a precedent only if it decides a question of law. A judgment should be understood in the light of facts of that case and no more should be read into it than what it actually says. It is neither desirable nor permissible to pick out a word or a sentence from the judgment of this Court divorced from the context of the question under consideration and treat it to be complete law decided by this Court. The judgment must be read as a whole and the observations from the judgment have to be considered in the light of the questions which were before this Court.
11. Therefore, following the judgments directly applicable in the cases under Section 163A and in view of the benevolent scheme of creating a statutory liability of the insurer, independent of the terms of policy and any other provision of law, it is held that the pleas and defences of the victim of the accident being tortfeaser, pillion rider, gratuitous passenger or employee of the insured were not available to the insurer for avoiding or defeating its liability to pay compensation in accordance with the prescribed formula.
3. In view of the above facts and discussion of law, aforesaid judgment of the Division Bench of this Court relied upon by the appellant could not be applied even as the issue squarely covered by the above observations was not raised and considered by the Court.
4. Therefore, the appeal fails and it is accordingly dismissed with no order as to costs. Civil Application does not survive in view of rejection of the appeal and accordingly, stands rejected. Rule issued in that application is discharged with no order as to costs. Learned counsel Mr. Parikh requested to continue the Ad-interim relief granted by the initial order dated 08.10.2007 for a period of six weeks, since the aforesaid judgment of this Court was proposed to be challenged in the higher forum. Accordingly, the Ad-interim relief in respect of liability under challenge of Rs. 2,82,834/- together with proportionate interest and cost shall continue to operate till 31.03.2008.