Oriental Insurance Company v. Roshni Devi & Ors.

claimants along with interest @ 12% per annum. The first liability was held to be that of Insurance Company. Feeling dissatisfied with the Award dated 17.02.1994, the Insurance Company has preferred the present appeal so as to take the plea that Insurance Company is not liable to pay any amount. It is contended that deceased Sewa Singh @ Sewa Ram was a gratuitous passenger and in view of authority “Oriental Fire and General Insurance Co. Ltd. vs. Gurdev Kaur and others” 1967 ACJ 158, Insurance Company is not liable to pay the compensation. It is further contended that even if the case of claimants is taken as a gospel truth, in that case also, in view of authority “New India Assurance Co. Ltd. vs. Asha Rani and ors.” 2003 (3) BCR 765, the Insurance Company is not liable. It is submitted that in that authority, it has been held that Insurance Company is not liable in respect of death or injury of a person travelling in a goods vehicle between the period

01.07.1989 till 14.11.1994. It is further submitted that Motor Vehicles Act, 1988, was made operational from 01.07.1989 and prior to that date, the Motor Vehicles Act, 1939 was applicable. In F.A.O NO. 1494 OF 1994 (O & M) -5- Section 95 of the Motor Vehicles Act, 1939, there was a proviso that any passenger travelling in the goods vehicle during employment in connection with plying the vehicle, in that case, Insurance Company is liable. That clause was deleted in the Motor Vehicles Act, 1988. The Parliament via Act 54 of 1994 added the following words in Section 147 (1) (b) (i) :- “147. Requirements of Policies and limits of liability- (b) xxx xxx (i) xxx Injury to any person, including owner of the goods or his authorised representative carried in the vehicle.” It is submitted that Hon'ble Apex Court in New India Assurance Co. Ltd.'s case (supra) has dealt with all the situations i.e cases relating to accidents prior to enforcement of Motor Vehicles Act, 1988 i.e cases covered under Motor Vehicles Act, 1939, cases relating to accidents covered after the enforcement of Motor Vehicles Act, 1988 till 14.11.1994 and the cases covered thereafter. So the Insurance Company is not liable. It is submitted that in the present case, the amount has been paid to the claimants. So, the Insurance Company is held entitled to recover the said amount from the owner of the vehicle in terms of policy. F.A.O NO. 1494 OF 1994 (O & M) -6- In reply to the above noted submissions, learned counsel for the owner and driver has supported the Award passed by the Tribunal. It is further submitted that since there is no gross violation of the terms of policy and as such, the Insurance Company is liable to pay the amount of compensation. I have considered the submissions made by both the sides and have gone through the case file. So far as Oriental Fire and General Insurance Co. Ltd's case (supra) is concerned, that relates prior to enforcement of Motor Vehicles Act, 1988 and as such, is not applicable to the facts of present case. In the present case the accident has taken place on

13.02.1992 and at that time Motor Vehicles Act, 1988 was applicable. In order to properly appreciate the controversy, proviso of Section 95 of the Act, 1939 is reproduced as under :-

(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 contract of 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;

F.A.O NO. 1494 OF 1994 (O & M) -7- Section 147 of the Motor Vehicles Act, 1988 is also reproduced as under :- “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 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 death of, or F.A.O NO. 1494 OF 1994 (O & M) -8- bodily injury to, any such employee- (a) engaged in driving the vehicle (b) if it is a public service vehicle engaged as conductor of the vehicle or in examining the tickets on the vehicle, or (c ) if it is a goods carriage, being carried in the vehicle, or (d) to cover any contractual liability.

The Parliament in its wisdom having realized that the owner or authorised agent who are travelling in a goods vehicle along with goods are not covered, added following words in Section 147 (1) (b) (i) of the Act :- “147. Requirements of Policies and limits of liability- (b) xxx xxx (i) xxx Injury to any person, including owner of the goods or his authorised representative carried in the vehicle.” The Hon'ble Apex Court in New India Assurance Co. Ltd.'s case (supra) has dealt with all the situations i.e cases relating to accidents prior to enforcement of Motor Vehicles Act, 1988 i.e cases covered under Motor Vehicles Act, 1939, cases relating to accidents covered after the enforcement of Motor Vehicles Act, 1988 till 14.11.1994 and the cases covered thereafter. The Hon'ble Apex Court reached to the conclusion that F.A.O NO. 1494 OF 1994 (O & M) -9- owner or employee of the goods travelling in goods vehicle during the period 01.07.1989 to 14.11.1994 are not covered by the terms of policy and as such, Insurance Company is not labile.

The present case also falls within that period. So in these circumstances, I have no hesitation in holding that since there is gross violation of the terms of policy, as such, Insurance Company is not liable to pay the amount. Consequently, the appeal preferred by the Insurance Company stands accepted and the Award stands modified to the extent that Insurance Company shall be entitled to recover the amount awarded by the Tribunal along with interest, as ordered by the Tribunal, from the owner of vehicle. Disposed of. APRIL 03, 2012 shalini (K. C. PURI) JUDGE