THE HON’BLE MR JUSTICE R. KANTHA RAO MACMA No. 457 of 2004 Date: 23.12.2009 BETWEEN: The Oriental Insurance Co. Ltd. .. Appellant And Bukya balu and others .. Respondents THE HON’BLE MR JUSTICE R. KANTHA RAO MACMA No. 457 of 2004 JUDGMENT: This appeal is directed against the order, dated 31.01.2003 passed by the Motor Accident Claims Tribunal-cum- II Additional District Judge, Nalgonda in O.P.No.604 of 1999. 2. The Oriental Insurance Company Limited, Nalgonda which is the second respondent before the Tribunal, preferred the present appeal challenging the order passed by the learned Tribunal against the finding viz. holding the appellant liable to indemnify the owner of offending vehicle-3rd respondent. According to the appellant, the learned Tribunal ought not to have held that the appellant and the third respondent are jointly and severally liable to pay compensation in view of the fact that the third respondent- insured willfully allowed the passengers to travel in a tractor and trailor bearing No.AP 24 T 504 and 505 which is a goods vehicle in violation of terms and conditions of the policy. 3. I have heard both the learned counsel. 4. For disposal of the present appeal, the following two points would arise for determination: 1. Whether the appellant – insurance company is liable to pay compensation to the respondents 1 and 2, who are the parents of the deceased Bukya Nagulu? 2. In the event of exonerating the appellant insurance company from paying compensation, a direction can be issued to satisfy the award in the first instance and then recover the amount from the owner of the vehicle? 5. POINT No.1: There is no dispute about the fact that the accident occurred on 09.05.1999 due to the rash and negligent driving of the driver of the tractor and trailor bearing No.AP24 T 505 and 505. It has been proved by the claimant before the learned Tribunal that the tractor and trailor turned turtle. 6. The fact that the driver of the tractor and trailor had driven the vehicle in a rash and negligent manner and on account of the same, the deceased who sat on the mudguard of the said vehicle, fell down and the wheel of the said vehicle ran over the deceased which ultimately resulted in his death has been proved before the Tribunal. Before the learned Tribunal, PW.1 admitted in the cross examination that he and his family members traveled in the said vehicle to attend a marriage function and while returning after attending the said function, the accident took place. The evidence of PW.2 is to the effect that he also traveled in the same vehicle for the purpose of attending the marriage function and the accident took place while he and others were returning in the same vehicle after attending the said function. Therefore, there is no dispute about the fact that the insured permitted the deceased and some other persons to travel in the tractor and trailor bearing No.24 T 504 and 505, which is a goods vehicle. 7. It is the contention of the learned counsel appearing for the appellant – insurance company that permitting the passengers to travel in a goods vehicle is in violation of terms and conditions of the policy and the same also being prohibited under Section 147 of the Motor Vehicles Act, the appellant insurance company is not liable to pay compensation. 8. Since the judgment in the case of NEW INDIA ASSURANCE CO. LTD v ASHARANI AND OTHERS[1], the law is well settled on the aspect that the insurance company is not liable to pay compensation for the passengers traveling in a goods vehicle whose risk is not covered under the policy of insurance. It was contended by the claimants before the learned Tribunal that the deceased was an employee under the third respondent – owner of the vehicle and therefore, the insurance company is liable to pay compensation. But absolutely they did not lead any evidence in proof of the said fact and in view of the legal position that unless the employee comes within the definition of Workman under Workmens’ Compensation Act, 1923, his risk is not covered under Section 147 of the Motor Vehicles Act. Since the evidence clinchingly establishes that the accident occurred while the deceased and other passengers were returning after attending a marriage function in the tractor and trailor belonging to the third respondent, which is a goods vehicle, it can be safely presumed that the owner of the vehicle permitted the passers to travel in a goods vehicle which is prohibited under Section 147 of the Act and also contrary to the terms and conditions of the policy of insurance. The appellant – insurance company is not liable to pay compensation. The finding of the Tribunal on this aspect therefore, is set aside and this point is answered in favour of the appellant – insurance company. 9. POINT NO.2: The other question requires consideration is even after holding that the appellant-insurance company is not liable to pay compensation whether it can be directed to satisfy the award in the first instance and recover the amount from the third respondent-owner of the vehicle. 10. Reliance is placed by the learned counsel appearing for the appellant-insurance company on the following decisions: SMT. THOKCHOM ONGOI SANGEETA AND ANOTHER v ORIENTAL INSURANCE CO. LTD AND OTHERS[2], UNITED INDIA INSURANCE CO. LTD v SERJERAO AND OTHERS[3], wherein the Supreme Court besides holding that the insurance company is not liable to pay compensation in respect of the death or injuries arising out of the motor vehicle accident, while the passengers were permitted to travel in a goods vehicle, remitted the matters to the respective High Courts for the limited purpose of fixing the responsibility of the person, who has to satisfy the award made by the Tribunals. 11. However, in view of the ratio laid down in NATIONAL INSURANCE COMPANY LTD v BALJIT KOUR[4] even though the insurance company is not liable to pay compensation for the violations of the terms and conditions of the policy committed by the owner of the vehicle, it has to satisfy the award in the first instance and then recover the amount from the owner of the vehicle. In a given situation, if such a direction is justified, the Tribunal can be directed to satisfy the award with a liberty to recover the amount from the owner of the vehicle without filing any separate suit for the said purpose. 12. In BALJITH KAUR1, the Apex Court held as follows: “It is clear that although the insurance company is not liable to pay the suit claim, all the same it has to first satisfy the suit claim and then recover the amount from the owner or holder of the policy of insurance.” 13. As a matter of fact, in some of it’s judgments, the Supreme Court upheld the orders of the Tribunals whereunder the Tribunals directed the insurers to first satisfy the award and then recover the amount from the owner of the offending vehicle. The decisions are referred below. 14. I n NATIONAL INSURANCE COMPANY LTD. VS. SAVITHRI DEVI AND OTHERS[5], the Supreme Court having held that the insurance company is not liable to pay compensation to the claimants where the vehicle was driven by a person, who had no valid driving licence clarified that no exception could be taken to the impugned order of the Tribunal that the insurance company has to pay the amount of compensation to the claimant, then it can recover the same from the owner of the offending vehicle. 15. In ORIENTAL INSURANCE COM. LTD. v NANJAPPAN[6] the Supreme Court following the ratio laid down in NATIONAL INSURANCE CO LTD. v. BALJIT KOUR[7] held that “the insurer shall pay quantum of compensation fixed by the Claims Tribunal about which there was no dispute raised, to the respondents/claimants within three months. 16. In NATIONAL INSURANCE COMPANY v KUSUM RAI[8] the Supreme Court held as follows: “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, in exercise of our jurisdiction under Article 136 of the Constitution of India, but we direct that the appellant to pay the award amount and it may recover the amount from the owner in the same manner as was directed in NANJAPPAN CASE. 17. Again in ORIENTAL INSURANCECOMPANY LIMITED v ZAHARULNISHA[9] it was held as follows: “Though the appellant/insurance company is not liable to pay the amount of compensation, but in the nature of this case it shall satisfy the award and shall have the right to recover the amount deposited along with interest from the owner of the vehicle, particularly in view of the fact that no appeal was preferred by him nor has he chosen to appear before this Court to contest this appeal. 18. Further in DADDAPPA v. BRANCH MANAGER, NATIONAL INSURANCE CO. LTD.[10] it was held as follows: “ However as the appellant hails from the lowest strata of society, we are of the opinion that in a case of this nature, we should, in exercise of our extraordinary jurisdiction under Article 142 of the Constitution of India, direct the responentNo.1 to pay the amount of claim to the appellants herein and recover the same from the owner of the vehicle, particularly, in view of the fact that no appeal was preferred by him.” 19. I n NEW INDIA ASSURANCE CO. LTD. v KUSUM AND OTHERS[11] the Supreme Court held that whenever, thus, a direction to pay the claimants and recover from the owner has been issued by the Tribunal, it must be held to have been done in exercise of its inherent power. 20. It has to be kept in mind that the Motor Vehicles Act in so far as it relates to payment of compensation to the victims of motor vehicle accidents is beneficent legislation and it has to be construed in favour of the victims of the accidents to the extent possible. The object of the act is not only to provide compensation, which is just and reasonable to the victims of the road traffic accidents, but also make them enjoy the fruits of the awards without subjecting them to long drawn procedure. In the Judgments relied upon by the learned counsel appearing for the appellant, the Supreme Court remitted the matter to the respective High Courts to decide the question relating to the liability to satisfy the award. The Supreme Court does not say that whenever the insurance company is held not liable to pay compensation, it shall not be directed to satisfy the award and then recover the amount from the owner of the vehicle. Further in the other decisions referred to above, the Supreme Court held that such a direction can be issued following the ratio in the case of Baljit Kaur. More particularly, in a recent decision in the case of Kusum Rai the Supreme Court held in categorical terms that whenever such a direction has been issued by the Tribunal, it cannot be interfered with, since such a direction is issued to avoid hardship to the claimant in realizing the amount of compensation awarded by the Tribunal. 21. In the present case, the claimants filed petition seeking compensation on account of death of the deceased in a motor vehicle accident occurred on 09.05.1999, they belong to a tribal community and residents of remote village, they being illiterate persons, it is highly difficult for them to recover the amount from the owner of the vehicle at this length of time. Therefore, it is expedient to issue a direction to the appellant-insurance company to satisfy the award and then recover the amount from the owner of the vehicle. 22. Consequently, it is held in this appeal that the appellant- insurance company is not liable to pay compensation, however, it is directed to satisfy the award and recover the amount from the owner of the vehicle-3rd respondent without filing any separate suit. 23. Accordingly, the appeal is partly allowed. No order as to costs. ___________________ Date: 23.12.2009. R. KANTHA RAO, J kvrm [1] 2003(1) ACJ [2] AIR 2008 SC 245 [3] AIR 2008 SC 460(1) [4] 2004 ACJ428 (SC) [5] 2004(2) AJR 88 SC [6] 2004 ACJ 721 SC [7] 2004 ACJ 428 (SC) [8] 2006 ACJ 1336 (SC) [9] 2008 ACJ 1928 (SC) [10] 2008 ACJ 581 (SC) [11] 2009 ACJ 2655