Judgment:
R.L. Khurana, J.
1. The above noted appeal and the cross-objections arising out of the award dated 8.12.1992 of the learned Motor Accidents Claims Tribunal, Chamba, (for short 'the Tribunal') passed in ACT Case No. 28 of 1989, are being disposed of by this single judgment.
2. One Rajinder Singh, a science teacher of about 35 years of age, died in an accident on 31.10.1989 which took place at about 7.30 p.m. near Tarvai curve within the local limits of jurisdiction of Police Station Tissa of District Chamba. The deceased at the relevant time was travelling as a pillion rider on scooter No. HIC 865 of which Tilak Singh, appellant before this Court, was the owner-cum-driver.
3. Respondent Nos. 1 to 3, the widow and minor daughters of the deceased, hereinafter referred to as the claimants, approached the learned Tribunal under Section 166, Motor Vehicles Act, 1988, seeking compensation to the tune of Rs. 7,00,000 for the death of the deceased. It was averred that the accident had taken place due to the rash and negligent driving of the appellant.
4. The appellant, though admitted the accident and the death of the deceased therein, denied the rash and negligent driving on his part. It was averred that the accident had taken place as the road was kacha and the scooter had slipped.
5. The insurance company, respondent No. 4 before this Court, denied its liability on two grounds, namely:
(a) the deceased was a pillion rider and the insurance policy did not cover the liability of a pillion rider; and
(b) the original insured was one Bal Krishan, the respondent No. 5 in this appeal. He had sold the scooter to the appellant before the accident. Neither any intimation of such sale was given nor the insurance policy was got transferred in favour of the appellant.
6. Respondent No. 5, Bal Krishan, the previous owner of the scooter denied his liability and it was pleaded that he had sold the scooter to the appellant much prior to the accident.
7. The learned Tribunal came to the conclusion that the accident had taken place due to rash and negligent driving on the part of the appellant. The claimants were held entitled to total compensation of Rs. 3,89,000. The insurance company, respondent No. 4 before this Court, was absolved from the liability on the ground that the scooter was sold by respondent No. 5 to the appellant prior to the accident and the insurance policy was never transferred in favour of the appellant. The appellant above was held liable for payment of the amount of compensation and interest thereon to the claimants.
8. Feeling aggrieved by the award of the learned Tribunal, the appellant has come up before this Court by way of appeal assailing the findings of the learned Tribunal as to the negligence, quantum of compensation and absolving respondent No. 4, insurance company, from the liability.
9. The claimants by way of cross-objections have also assailed the quantum of compensation awarded. It has been pleaded that the amount of compensation awarded is on the lower side. The same is neither adequate nor just.
10. The first point arising for determination is whether the accident was as a result of rash and negligent driving of the appellant.
11. Admittedly, the accident took place on the right side of the road. The scooter had gone off the road on the right side and fell into a nala. Appellant, while appearing as his own witness has admitted that the road was about 20 feet wide at the place of occurrence. There was no impact of the scooter with any other vehicle. According to the appellant, the scooter had skidded due to the bajri lying on the road. He has admitted that he had seen the bajri on the road. It appears that in spite of having seen the bajri, the appellant continued driving at the same speed, as a result the scooter might have skidded. The fact that the scooter skidded from the left side of the road to the right side and after having gone off the road had fallen into a nala shows that the scooter was being driven at a very high speed. The appellant, therefore, failed to take the necessary precautions expected of him, while driving the scooter. On the facts and in the circumstances of the case, the learned Tribunal by applying the principle of res ipsa loquitur, has rightly held that the accident had taken place due to rash and negligent driving on the part of the appellant.
12. There is no denying that the scooter was sold by respondent No. 5 to the appellant before the accident. The appellant, while appearing as his own witness, has admitted that the registration certificate of the scooter was transferred in his name on 23.3.1989. He has also admitted that no notice to the insurance company was given by him for the transfer of insurance policy in his name.
13. In absolving the insurance company of its liability under the insurance policy due to transfer of scooter by the original insured, respondent No. 5, in favour of the appellant prior to the accident, the learned Tribunal has placed reliance on the ratio laid down by a learned single Judge of this Court in Kanta Devi v. Dayal Singh 1991 ACJ 336 (HP).
14. It is significant to note that the ratio, on which reliance has been placed by the learned Tribunal, was laid down keeping in view the provisions of the Motor Vehicles Act, 1939. The said Act stands repealed with effect from 1.7.1989, on the coming into force of the Motor Vehicles Act, 1988.
15. Section 157 (1) of the Motor Vehicles Act, 1988, provides:
157. Transfer of certificate of insurance.-(1) Where a person in whose favour the certificate of insurance has been issued in accordance with the provisions of this Chapter transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.
16. The above provisions lay down that the certificate of insurance and the policy described therein would be deemed to have been transferred in favour of the person to whom the vehicle is transferred from the date of transfer.
17. In National Insurance Co. Ltd. v. Lalita Prabhakar 1998 ACJ 1124 (HP), this very Division Bench of the court had the occasion to deal with the scope of Section 157, Motor Vehicles Act, 1988 and it was held that the policy of insurance would be deemed to have been transferred in favour of the transferee with effect from the date of transfer and the liability of the insurance company would continue during the subsistence of the policy irrespective of the transfer of the vehicle.
18. The Apex Court also in Complete Insulations (P) Ltd. v. New India Assurance Co. Ltd. 1996 ACJ 65 (SC), has held that in respect of the third party risks, Section 157 of the Motor Vehicles Act, 1988, provides that the certificate of insurance together with the policy of insurance described therein 'shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred'.
19. In view of the provisions contained in Section 157 of the Motor Vehicles Act, 1988 and the ratio laid down by the Division Bench of this Court in Lalita Prabhakar's case, 1998 ACJ 1124 (HP), and that laid down by the Apex Court in Complete Insulations (P) Ltd.'s case, 1996 ACJ 65 (SC), the law laid down by the learned single Judge of this Court in Kama Devi's case, 1991 ACJ 336 (HP), is no more a good law in respect of the cases governed by the provisions of the Motor Vehicles Act, 1988.
20. There is yet another aspect of the case. The defence that policy had lapsed because of sale of the vehicle is not available to the insurance company under Section 149 (2), Motor Vehicles Act, 1988 [See: Lalita Prabhakar's case, 1998 ACJ 1124 (HP)].
21. The learned Tribunal, therefore, committed an error in absolving the insurance company, respondent No. 4, of its liability. Such findings of the learned Tribunal are as such liable to be set aside, which we do hereby set aside.
22. The next contention raised on behalf of the insurance company is that it is not liable for the death of a pillion rider, since such a rider was not covered under the terms of the policy. The learned Counsel has drawn our pointed attention to IMT 70 of the 'Endorsements' forming part of the insurance policy, Exh. R-l. This clause reads:
I.M.T. 70: Accident to any unnamed hirer/driver/pillion passengers.-In consideration of the payment of an additional premium as stated in the Schedule it is hereby understood and agreed that the company undertakes to pay compensation to any unnamed hirer/ driver/any unnamed pillion passenger on the scale provided below for bodily injury caused by violent accidental external and visible means whilst mounting into/onto and dismounting from or travelling in/on the motor cycle/auto-cycle/scooter which independently of any other cause shall within six calendar months of the occurrence of such injury results in...
23. A perusal of the policy, Exh. R-l, as a whole brings to light two facts, namely:
(a) Only endorsements mentioned/ attached in the Schedule formed part of the policy; and
(b) The policy has been made subject to I.M.T. Nos. and Memorandum 2 (a), 21 and 23.
24. It is, therefore, evident that I.M.T. 70, on which reliance has been placed by the learned Counsel for the insurance company did not form part of the policy. As such, the said clause cannot be pressed into service by the insurance company.
25. In Oriental Insurance Co. Ltd. v. Ved Parkash 1995 ACJ 1125 (HP), on similar facts, a Division Bench of this Court had held the insurance company liable for the death of a pillion rider of a motor cycle. This ratio is applicable to the facts of the present case on all fours.
26. The question of liability of the insurance company in respect of the death of a pillion rider under the provisions of Motor Vehicles Act, 1988, vis-a-vis the provisions of the old Act of 1939 came up for consideration before the High Court of Kerala in United India Insurance Co. Ltd. v. Appukuttan 1995 ACJ 888 (Kerala). It was held:
But the position has completely been changed when the new Motor Vehicles Act, 1988, came into force. In Section 147 of the new Act which corresponds to Section 95 of the old Act there is no limit in certain cases as contained in Clause (ii) of the old Act. The corresponding proviso in the old Act contained three clauses whereas now there are only two clauses. What was dropped in the new Act is the clause which excluded the coverage for death of or bodily injury to persons carried in or upon the vehicle. That means such liability cannot now be excluded from the policy. The result is, when a policy of insurance is an 'Act policy', it does not necessarily mean that the insurance company will stand absolved from the liability in respect of the pillion rider of a motor cycle.
27. The present case is also governed by the provisions of the Motor Vehicles Act, 1988 and, therefore, the ratio laid down by Kerala High Court in the above referred case and with which we are in full agreement, would apply. Therefore, we hold that the insurance company is liable for the death of the deceased, who was a pillion rider, to the whole extent of the amount of compensation without any limit.
28. Insofar as the quantum of compensation is concerned, it is significant to note that the deceased was a science teacher of about 35 years of age. His monthly income by way of salary was about Rs. 2,500. The learned Tribunal on the basis of this monthly income of the deceased had rightly assessed the dependency of the claimants at Rs. 1,600 per month or say Rs. 19,200 per annum. Considering the age of the deceased proper multiplier was applied by the Tribunal and proper and just compensation stands awarded to the claimants. The amount of compensation awarded by the learned Tribunal can be said to be neither on a lower side nor on a higher side. The assessment of quantum of compensation by the learned Tribunal, therefore, calls for no interference.
29. Resultantly, while the appeal being F.A.O. No. 9 of 1993 is partly allowed, the cross-objections as preferred by the claimants being CO. No. 190 of 1994 are dismissed. The award of the learned Tribunal is modified to the extent that the respondent No. 4, insurance company, would be also liable jointly and severally along with the appellant for the payment of amount of compensation awarded to the claimants along with interest. Parties are, however, left to bear their own costs.