Oriental Insurance Co. Ltd Vs.
Brij Mohan & Ors  Insc 580 (15 May 2007)
S.B. Sinha & Markandey Katju
CIVIL APPEAL NO. 2532 of 2007 [Arising out of S.L.P. (C) No. 10655 of 2004]
S.B. SINHA, J.
1. Leave granted.
2. Appellant Insurance Company is before us being aggrieved by and
dissatisfied with the judgment and order dated 27.1.2004 passed by a Division
Bench of the High Court of Rajasthan dismissing an appeal from the judgment and
award dated 7.4.1999 passed by Motor Accident Claims Tribunal, Baran in the
State of Rajasthan.
3. First Respondent Brij Mohan filed the claim petition. He was a labourer.
On or about 11.3.1998 he was travelling on a trolley attached to a tractor.
There exists a dispute as to whether both the tractor and the trolley were insured
or not. It may not be necessary to determine the said question.
He was engaged to dig earth from a place known as Shishwali Ka Rasta.
The earth so dug was loaded on the trolley attached to the tractor.
Respondent and other workers were returning to the Bhatta (brick-klin). He
was sitting on the earth loaded on the trolley. The tractor allegedly was being
driven rashly and negligently by Hemraj, the driver. He slipped down from the
trolley, came under the wheels thereof injuring his gall-bladder and left
thigh, as a result whereof he suffered grievous injuries.
4. The learned Tribunal noticed the defence raised by the appellant herein
in the said proceedings which, inter alia, were :
(i) the trolley was not insured, and only the tractor was insured;
(ii) as the tractor was not being used for agricultural work, the claim
petition was not maintainable.
(iii) issuance of premium having been paid only for one person, namely, the
driver of the tractor; no award could be passed against the insurer.
5. The Tribunal, however, by reason of its award, awarded a sum of Rs.
1,96,100/- by way of compensation in favour of the respondent in respect of
the injuries suffered by him as a result of the said accident. An appeal,
preferred thereagainst, as noticed hereinbefore, has been dismissed by the High
Court by reason of the impugned judgment.
6. Mr. M.K. Dua, learned counsel appearing on behalf of the appellant
submitted that the Tribunal as also the High Court committed manifest errors in
passing the impugned Award and judgment insofar as they failed to take into
(i) The tractor alone was insured and thus the claim petition was not
(ii) In any event, Respondent no.1 was merely a gratuitous passenger and
thus the claim was not covered under Section 147 of the Motor Vehicles
(iii) The tractor having not been used for agricultural purpose there had
been a violation of the conditions of contract of insurance.
7. Ms. Indu Malhotra, learned counsel appearing on behalf of the respondent,
on the other hand, submitted :
(i). The question as to whether both the tractor and the trolley were
insured or not having not been raised before the Tribunal, this Court should
not permit the appellant to raise the said contention before this Court.
(ii) The representative of the appellant in his statement before the Court
admitted that putting the earth and leveling the field would also be an
agricultural work and thus it cannot now be contended that the tractor was not
being used for the said purpose.
(iii) In any event, having regard to the grievous injuries suffered by the
respondent, this Court should direct the appellant to pay the awarded amount
and recover the same from the owner of the tractor and trolley.
8. The Tribunal in its award has, inter alia, noticed that the appellant
herein had raised a specific defence, namely, the trolley was not insured. It
does not appear that the said contention of the appellant had been gone into.
There is nothing on records to show that the owner of the tractor had
produced any insurance cover in respect of the trolley. It is furthermore not
disputed that the tractor was insured only for the purpose of carrying out
agricultural works. The representative of the Insurance Company Mr. Hari Singh
Meena on cross-examination merely accepted the suggestion that cutting the
earth and levelling the field with earth would be an agricultural work but
respondent no.1 himself categorically stated in his claim petition before the
Tribunal stating that the earth had been dug and was being carried in the
trolley to the brick-klin. Evidently the earth was meant to be used only for
the purpose of manufacturing bricks. Digging of earth for the purpose of
manufacture of brick-klin indisputably cannot amount to carrying out of the
9. In National Insurance Co. Ltd. v. V. Chinnamma & Ors. [(2004) 8 SCC
697], this Court held :- "14. An insurance for an owner of the goods or
his authorised representative travelling in a vehicle became compulsory only
with effect from 14-11-1994 i.e. from the date of coming into force of amending
Act 54 of 1994.
15. Furthermore, a tractor is not even a "goods carriage".
The expression goods carriage has been defined in Section 2(14) to mean
"any motor vehicle constructed or adapted for use solely for the carriage
of goods, or any motor vehicle not so constructed or adapted when used for the
carriage of goods"
(emphasis supplied) whereas "tractor" has been defined in Section
2(44) to mean "a motor vehicle which is not itself constructed to carry
any load (other than equipment used for the purpose of propulsion); but
excludes a roadroller".
"Trailer" has been defined in Section 2(46) to mean "any
vehicle, other than a semi-trailer and a sidecar, drawn or intended to be drawn
by a motor vehicle".
16. A tractor fitted with a trailer may or may not answer the definition of
goods carriage contained in Section 2(14) of the Motor Vehicles Act.
The tractor was meant to be used for agricultural purposes. The trailer
attached to the tractor, thus, necessarily is required to be used for
agricultural purposes, unless registered otherwise. It may be, as has been
contended by Mrs K. Sharda Devi, that carriage of vegetables being agricultural
produce would lead to an inference that the tractor was being used for
agricultural purposes but the same by itself would not be construed to mean
that the tractor and trailer can be used for carriage of goods by another
person for his business activities. The deceased was a businessman. He used to
deal in vegetables. After he purchased the vegetables, he was to transport the
same to the market for the purpose of sale thereof and not for any agricultural
purpose. The tractor and trailer, therefore, were not being used for
agricultural purposes. However, even if it be assumed that the trailer would
answer the description of "goods carriage" as contained in Section
2(14) of the Motor Vehicles Act,
the case would be covered by the decisions of this Court in Asha Rani1 and
other decisions following the same, as the accident had taken place on
24-11-1991 i.e. much prior to coming into force of the 1994 amendment."
10. Furthermore, respondent was not the owner of the tractor. He was also
not the driver thereof. He was merely a passenger travelling on the trolley
attached to the tractor. His claim petition, therefore, could not have been
allowed in view of the decision of this Court in New India Assurance Co. Ltd.
v. Asha Rani & Ors. [(2003) 2 SCC 223] wherein the earlier decision of this
Court in New India Assurance Co. v. Satpal Singh [(2000) 1 SCC 237] was
overruled. In Asha Rani (supra) it was, inter alia, held :- "25. Section
147 of the 1988 Act, inter alia, prescribes compulsory coverage against the
death of or bodily injury to any passenger of "public service
Proviso appended thereto categorically states that compulsory coverage in
respect of drivers and conductors of public service vehicle and employees
carried in a goods vehicle would be limited to the liability under the Workmens
Compensation Act. It does not speak of any passenger in a "goods
26. In view of the changes in the relevant provisions in the 1988 Act
vis-`-vis the 1939 Act, we are of the opinion that the meaning of the words
"any person" must also be attributed having regard to the context in
which they have been used i.e. "a third party". Keeping in view the
provisions of the 1988 Act, we are of the opinion that as the provisions
thereof do not enjoin any statutory liability on the owner of a vehicle to get
his vehicle insured for any passenger travelling in a goods vehicle, the
insurers would not be liable therefor.
27. Furthermore, sub-clause (i) of clause (b) of sub- section (1) of Section
147 speaks of liability which may be incurred by the owner of a vehicle in
respect of 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, whereas sub-clause (ii) thereof deals with liability which may be incurred
by the owner of a vehicle 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."
[See also National Insurance Co. Ltd. v. Bommithi Subbhayamma and Others
[(2005) 12 SCC 243 and United India Insurance Co. Ltd., Shimla v.
Tilak Singh and Ors. [(2006) 4 SCC 404].
11. Although the effect in 1994 amendment in the Motor Vehicles Act
did not call for consideration in Asha Rani (supra), a 3 Judge Bench of this
Court had the occasion to consider the said question in National Insurance
"17. By reason of the 1994 amendment what was added is
"including" owner of the goods or his authorised representative
carried in the vehicle. The liability of the owner of the vehicle to insure it
compulsorily, thus, by reason of the aforementioned amendment included only the
owner of the goods or his authorised representative carried in the vehicle
besides the third parties. The intention of Parliament, therefore, could not
have been that the words any person occurring in Section 147 would cover all
persons who were travelling in a goods carriage in any capacity whatsoever. If
such was the intention, there was no necessity of Parliament to carry out an
amendment inasmuch as the expression any person contained in sub-clause (i) of
clause (b) of sub-section (1) of Section 147 would have included the owner of
the goods or his authorised representative besides the passengers who are
gratuitous or otherwise.
18. The observations made in this connection by the Court in Asha Rani case2
to which one of us, Sinha, J., was a party, however, bear repetition: (SCC p.
235, para 26)
26. In view of the changes in the relevant provisions in the 1988 Act
vis-`-vis the 1939 Act, we are of the opinion that the meaning of the words any
person must also be attributed having regard to the context in which they have
been used i.e. a third party. Keeping in view the provisions of the 1988 Act,
we are of the opinion that as the provisions thereof do not enjoin any
statutory liability on the owner of a vehicle to get his vehicle insured for
any passenger travelling in a goods vehicle, the insurers would not be liable
19. In Asha Rani2 it has been noticed that sub-clause (i) of clause (b) of
sub-section (1) of Section 147 of the 1988 Act speaks of liability which may be
incurred by the owner of a vehicle in respect of 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. Furthermore, an owner of a
passenger- carrying vehicle must pay premium for covering the risks of the
passengers travelling in the vehicle. The premium in view of the 1994 amendment
would only cover a third party as also the owner of the goods or his authorised
representative and not any passenger carried in a goods vehicle whether for
hire or reward or otherwise.
12. Interpretation of the contracts of insurance in terms of Section 147 and
149 of the Motor
Vehicles Act came up for consideration recently before a Division Bench of
this Court in National Insurance Co. Ltd. v.
Laxmi Narain Dhut [2007 (4) SCALE 36], wherein it was held :- "24. As
noted above, there is no contractual relation between the third party and the
insurer. Because of the statutory intervention in terms of Section 149, the
same becomes operative in essence and Section 149 provides complete insulation.
25. In the background of the statutory provisions, one thing is crystal
clear i.e. the statute is beneficial one qua the third party. But that benefit
cannot be extended to the owner of the offending vehicle. The logic of fake
licence has to be considered differently in respect of third party and in
respect of own damage claims."
It was further observed :
"36. It is also well settled that to arrive at the intention of the
legislation depending on the objects for which the enactment is made, the Court
can resort to historical, contextual and purposive interpretation leaving
textual interpretation aside.
37. Francis Bennion in his book "Statutory Interpretation"
described "purposive interpretation" as under:
'A purposive construction of an enactment is one which gives effect to the
legislative purpose by- (a) following the literal meaning of the enactment
where that meaning is in accordance with the legislative purpose, or (b)
applying a strained meaning where the literal meaning is not in accordance with
the legislative purpose.'
38. More often than not, literal interpretation of a statute or a provision
of a statute results in absurdity. Therefore, while interpreting statutory
provisions, the Courts should keep in mind the objectives or purpose for which
statute has been enacted. Justice Frankfurter of U.S. Supreme Court in an
article titled as Some Reflections on the Reading of Statutes (47 Columbia Law
Reports 527), observed that, "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."
[See also The Oriental Insurance Company Ltd. v. Meena Variyal Ors.
[2007 (5) SCALE 269]
13. However, respondent no.1 is a poor labourer. He had suffered grievous
injuries. He had become disabled to a great extent. The amount of compensation
awarded in his favour appears to be on a lower side. In the aforementioned
situation, although we reject the other contentions of Ms.
Indu Malhotra, we are inclined to exercise our extraordinary jurisdiction
under Article 142 of the Constitution of India so as to direct that the award
may be satisfied by the appellant but it would be entitled to realize the same
from the owner of the tractor and the trolley wherefor it would not be
necessary for it to initiate any separate proceedings for recovery of the
amount as provided for under the Motor Vehicles Act.
14. It is well settled that in a situation of this nature this Court in
exercise of its jurisdiction under Article 142 of the Constitution of India
read with Article 136 thereof can issue suit directions for doing complete
justice to the parties.
15. In National Insurance Company Ltd. v. Kusum Rai & Others (2006) 4
SCC 250], this Court observed :
"19. Thus, although we are of the opinion that the appellant was not
liable to pay the claimed amount as the driver was not possessing a valid
licence and the High Court was in error in holding otherwise, we decline to
interfere with the impugned award, in the peculiar facts and circumstances of
the case, in exercise of our jurisdiction under Article 136 of the Constitution
but we direct that the appellant may recover the amount from the owner in the
same manner as was directed in Nanjappan."
16. This appeal is allowed with the aforementioned directions. There shall,
however, be no order as to costs.