Insurance Co. Ltd Vs. Prema Devi & Ors  Insc 317 (29 February 2008)
Arijit Pasayat & P. Sathasivam
APPEAL NO. 1667 2008 (Arising out of SLP (C) No. 7058/2004) Dr. ARIJIT PASAYAT,
Challenge in this appeal is to the order passed by a learned Single Judge of
the Allahabad High Court, Lucknow Bench dismissing the appeal filed by the
Background facts in a nutshell are as follows:
accident in the instant case took place on 1.6.1996.
claimant was travelling in a goods carriage, as a gratuitous passenger.
Undisputedly she was not traveling in the goods carriage in the capacity of
owner of goods or representative of owner of goods being transported in the
goods carriage. This aspect was also accepted by the claimant in the claim
Stand of the appellant was that the owner of the goods carriage had not taken
any policy for such passenger and there was no requirement under law for
obtaining a policy for passenger.
Learned counsel for the appellant submitted that the claimant could not claim
indemnification by the appellant and the owners of the offending vehicles were
to indemnify the award.
Learned counsel for the claimant and the owners of the offending vehicles
supported the order of the High Court.
New India Assurance Co. Ltd. v. Vedwati and Ors. (2007 (3) SCALE 397), it was
held as under:
This Court had occasion to deal with cases of passengers traveling in goods
vehicles which met accident resulting in death of such person or bodily injury.
Such cases belong to three categories i.e.
covered by the old Act,
covered by the Act; and
covered by amendment of the Act in 1994 by the Motor Vehicles (Amendment) Act.
1994 (hereinafter referred to as the 'Amendment Act').
present appeals belong to the second category.
8. In Satpal
Singh's case (supra) this Court proceeded on the footing that provisions of
Section 95(1) of the old Act are in pari materia with Section 147(1) of the Act
as it stood prior to the amendment in 1994.
a closer reading of the expressions "goods vehicle". "public
service vehicle", "state carrier" and "transport
vehicle" occurring in Sections 2(8), 2(25), 2(29) and 2(33) of the old Act
with the corresponding provisions i.e. Section 2(14), 2(35) 2(40) and 2(47) of
the Act, it is clear that there are conceptual differences.
provisions read as follows:
(8) "goods vehicle" means any motor vehicle 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
"public service vehicle" means any motor vehicle used or adapted to
be used for the carriage of passengers for hire or reward and includes a motor
cab contract carriage, and stage carriage."
"stage carriage" means a motor vehicle carrying or adapted to carry
more than six persons excluding the driver which carries passengers for hire or
reward at separate fares paid by or for individual passengers either for the
whole journey or for stages of the journey:"
"transport vehicle" means a public service vehicle or a goods
Act (New Act):
"goods carriage" any motor vehicle constructed or adapted for use
solely for the carriage of goods or any motor vehicle not to constructed or
adapted when used for the carriage of goods:"
"public service vehicles" means any motor vehicles used or adapted to
be used for the carriage of passengers for hire or reward, and includes a maxicab
a motorcab, contract and stage carriage:"
2(40) "stage carriage" means a motor vehicle constructed or adapted
to carry more than six passengers excluding the driver for (SIC) or reward at
separate fares paid by or for individual passengers either for the whole
journey or for stages of the journey:"
"transport vehicle" means a pubic services vehicle a goods carriage
an educational institution bus or a private service vehicle:"
"Liability" as defined in Section 145(c) of the Act reads as follows:
wherever used in relation to the death of or bodily injury to any person,
includes liability in respect thereof under Section 140."
Third party risks in the background of vehicles which are subject-matter of
insurance are dealt with in Chapter VIII of the old Act and Chapter XI of the
Act. Proviso to Section 147 of the Act (sic) is to be (sic) with Section 96 of
the old Act. Proviso to Section 147 of the Act reads as follows:
that a policy shall not be required
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 injure 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. 1993 (8 of 1923) in respect of the death of or bodily injury to, any such
in driving the vehicle, or
it is a public service vehicle engaged as conductor of the vehicle or in
examining tickets on the vehicles, or
it is a good carriage, being carried in the vehicle, or
cover any contractual liability."
is of significance that proviso appended to Section 95 of the old Act contained
Clause (ii) which does not find place in the Act. The same reads as follows:-
"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."
The difference in the language of "goods vehicle" as appear in the
old Act and "goods carriage" in the Act is of significance. A bare
reading of the provisions makes it clear that the legislative intent was to
prohibit goods vehicle from carrying any passenger. This is clear from the
expression "in addition to passengers" as contained in definition of
"good vehicle" in the old Act. The position becomes further clear
because the expression used is "good carriage" is solely for the
carriage of goods. Carrying of passengers in a goods carriage is not
contemplated in the Act. There is no provision similar to Clause (ii) of the
proviso appended to Section 95 of the old Act prescribing requirement of
Section 147 of the Act mandates compulsory coverage against death of or bodily
injury to any passenger of "public service vehicle". The proviso
makes it further clear that compulsory coverage in respect of drivers and
conductors of public service vehicle and employees carried in goods vehicle
would be limited to liability under the Workmen's Compensation Act, 1923 (in
short 'WC Act").
is no reference to any passenger in "goods carriage".
The inevitable conclusion, therefore, is that provisions of the Act do not
enjoin any statutory liability on the owner of a vehicle to get his vehicle
insured for any passenger travelling in a goods carriage and the insurer would
have no liability therefor.
Our view gets support from a recent decision of a three-Judge Bench of this
Court in New India Assurance Company Limited v. Asha Rani and Ors. (2002 (8)
Supreme 594] in which it has been held that Satpal Singh's case (supra) was not
correctly decided. That being the position, the Tribunal and the High Court
were not justified in holding that the insurer had the liability to satisfy the
This position was also highlighted in Oriental Insurance Co. Ltd. v. Devireddy Konda
Reddy and Others (2003(2) SCC 339).
also in National Insurance Co. Ltd. v. Ajit Kumar and Others (2003(9) SCC 668),
in National Insurance Co. Ltd. v. Baljit Kaur and Others (2004 (2) SCC 1) and
in National Insurance Co. Ltd. v. Bommithi Subbhayamma and Others (2005 (12)
SCC 243), the view in Asha Rani's case (supra) was reiterated."
Above being the position, the impugned order of the High Court is not
sustainable and is set aside. It is open to the claimant to recover the amount
awarded from the owners of the offending vehicles.
appeal is allowed with no order as to costs.