IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA FAO(MVA) No.572 of 2000 Decided on : September 10, 2009 New India Assurance Company ....Appellant. VERSUS Sunita Devi and others ....Respondents. Coram The Hon’ble Mr. Justice Surjit Singh, Judge. Whether approved for reporting?1 No. For the Appellant : Mr. K.D. Sood, Advocate. For the respondents : Mr. Anil Chauhan, Advocate, for respondents No.1 to 5. Ms Aruna Sharma, Advocate, vice Ms Jyotsna Rewal Dua, Advocate, for respondent No.6. Surjit Singh, J This appeal by the Insurance Company is directed against the award, dated 22nd August, 2000, of the Motor Accident Claims Tribunal, whereby petition, under Section 166 of the Motor Vehicles Act, filed by the dependents of deceased Dalip Singh, who died in an accident of Car No. UPT-6397, has been allowed and appellant-Insurance Company has been ordered to pay compensation amounting to Rs.3,38,500/-. 2. Respondent Sunita Devi, widow, Master Vishal Thakur son, Kumari Tanuja, daughter, Smt. Divri Devi, mother and Chet Ram, father, of deceased Dalip Singh filed Whether the reporters of the local papers may be allowed to see the Judgment? …2… a petition, under Section 166 of Motor Vehicles Act against respondents Manish Kumar and Shah Alam, as also the present appellant, in its capacity as Insurer of the vehicle, seeking compensation for the death of said Dalip Singh, in an accident of Car No.UPT-6397. It was alleged that initially the Car belonged to respondent Shah Alam, but he sold it to respondent Manish Kumar. The Car was insured with the appellant for third party risk. 3. On 10th October, 1998, deceased Dalip Singh and his father respondent Chet Ram hired the Car, in question, for travelling to Shillai in Sirmour District of Himachal Pradesh, from Harbertpur in Uttar Pradesh. Respondent Manish Kumar, owner of the Car, was himself driving it. When the Car reached near village Timbi, respondent Manish Kumar drove it in a rash or negligent manner, as a result of which the Car rolled down the road and fell into a Khad. Dalip Singh died as a result of that accident. 4. Respondent Manish Kumar denied that he was the owner of the vehicle. He stated that Shah Alam was the owner of the vehicle and the vehicle was registered in his name and it was he who had purchased the Insurance Policy covering third party risk. He denied that he was driving the vehicle in a rash or negligent manner. It was also denied that the Car was hired by deceased Dalip Singh …3… and his father Chet Ram. Allegation that the vehicle was being driven in a rash or negligent manner was also denied. 5. Shah Alam, who was impleaded as respondent No.3, did not appear and so, he was proceeded against ex- parte. The present appellant, which was impleaded as respondent No.2, took the plea that Insurance Policy having been purchased by Shah Alam and not by Manish Kumar, there was no privity of contract between it (the appellant) and Manish Kumar and, hence, it was not liable to indemnify him. It was also stated that the vehicle was being driven in breach of one of the conditions of the Policy, viz. the vehicle was not to be used for hire or reward, but, as per averment in the petition itself, deceased Dalip Singh and his father Chet Ram had hired the Car. 6. The Tribunal, on conclusion of inquiry, held that the accident took place because of rash or negligent driving of the Car. Appellant’s plea that the Car was used for hire or reward, in breach of one of the conditions of the Policy, was rejected and it was held that there was no evidence that any fare had been paid by the deceased or his father Chet Ram. Insurer’s plea that there was no privity of contract between it and respondent Manish Kumar also did not find favour with the Tribunal. Consequently, the Tribunal allowed the petition and ordered the appellant to pay the compensation, being the insurer. …4… 7. Appellant has challenged the award on the following three grounds, namely (1) deceased was travelling for hire or reward and, hence, there was breach of a condition of Policy, on account of which it (the Insurance Company) is not liable; (2) Policy having been purchased by Shah Alam after the transfer of the vehicle in favour of respondent Manish Kumar, there was no privity of contract between it (the appellant) and respondent Manish Kumar; and (3) the compensation awarded by the Tribunal was grossly on the higher side. 8. Appeal was allowed by the Court, vide judgment dated 17th November, 2006. Respondent Manish Kumar filed an application, under Order 9 Rule 13 of the Code of Civil Procedure, seeking setting aside of the order dated 17th November, 2006, passed by this Court, on the plea that he had not been served and, hence, ex-parte order passed against him, by this Court, was bad. That application was allowed and order dated 17th November, 2006 was set aside. 9. Matter has been heard afresh today, in the presence of the learned counsel appearing for respondent Manish Kumar, learned counsel for the dependants of deceased Dalip Singh, who are also respondents in this appeal and the learned counsel for the appellant. 10. In the petition, under Section 166 of the Motor Vehicles Act, to which Chet Ram, the father of deceased …5… Dalip Singh, is one of the signatories, it is categorically stated that the deceased and Chet Ram were travelling by the Car, in question, as paid passengers, as they had paid fare to Manish Kumar. Though Chet Ram, while in the witness-box, denied that any fare had been paid or was agreed to be paid, that carried no weightage, when there was an averment in the petition itself, which amounts to admission in the petition itself that they had paid fare to respondent Manish Kumar, which averment can be used as admission in its favour by the appellant. In view of this admission by the claimants, learned trial Tribunal was not right in holding that there was no evidence that the deceased was travelling by the Car, on payment of fare and so he was only a gratuitous passenger. 11. Insurance Policy Ex. R-1, specifically provided vide sub-clause (i)(a) of Clause (a) that the vehicle was not to be used for hire or reward. Respondent Manish Kumar having charged fare from the deceased and his father Chet Ram, there was clearly breach of the aforesaid condition of the Policy and so the appellant was not liable to indemnify the insured for his liability to third party, i.e. the dependents of deceased Dalip Singh. 12. Learned counsel representing respondent Manish Kumar has submitted that Shah Alam never sold the vehicle to respondent Manish Kumar and as such he was not the owner of the vehicle and cannot be ordered to pay the …6… compensation. The submission is without merit. Respondent Manish Kumar did not lead any evidence during the course of inquiry. Appellant examined PW-4 Rajni Sharma, an employee of the Court of Additional Chief Judicial Magistrate, Paonta Sahib, and got proved from her copies of four documents available on the record of case file No.439/4 of 1998. These documents are an application, copy Ex. P-4, a letter written to the SHO by the Additional Chief Judicial Magistrate, copy Ex. P-5, Spurdginama Ex. P- 6 and surety bond Ex. P-7. 13. Application Ex. P-4 was submitted to the Additional Chief Judicial Magistrate by respondent Manish Kumar for release of the Car, in question, which had been impounded after the accident, in which Dalip Singh died. In the said application, he stated that he had purchased the Car from previous owner Shah Alam and that the letter of sale was with the police. That application was allowed and the Car was ordered to be released in favour of the applicant (respondent Manish Kumar), vide communication Ex.P-5 addressed to the Station House Officer, Police Station, Shillai. Respondent Manish Kumar then furnished Spurdginama Ex. P-6 and also a surety bond Ex. P-7, and get the Car released. Averment in application Ex. P-4 by respondent Manish Kumar that he had purchased the Car from previous owner Shah Alam amounts to admission on …7… his part that he was the owner of the vehicle, at the time when the accident took place. 14. There is nothing on record, indicating that the Insurance Policy Ex. R-1 was purchased by Shah Alam, after he had sold the Car to Manish Kumar. It is quite likely that the Policy was purchased before the transfer of the vehicle by Shah Alam in favour of Manish Kumar. If that is so, Manish Kumar being the transferee of the vehicle, subsequent to the purchase of Policy by Shah Alam, is entitled to the benefit under the Policy. 15. In view of the abovestated position, appeal is accepted and it is held that on account of breach of condition as to the use of the vehicle, the Insurance Company is not liable to indemnify the insured. However, in view of the law laid down by the Hon’ble Supreme Court in National Insurance Co. Ltd. vs. Swaran Singh and others, it is ordered that the appellant is liable to satisfy the award and after satisfying the award, it may recover the entire amount, paid by it towards the satisfaction of the award, from the insured/owner of the vehicle and for such recovery it need not file any fresh suit or other case and may do so by executing this judgment itself. Appeal stands disposed of. September 10, 2009(sd) ( Surjit Singh ), J.