IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE J.B.KOSHY & THE HONOURABLE MRS. JUSTICE K.HEMA TUESDAY, THE 25TH MARCH 2008 / 5TH CHAITHRA 1930 MACA.No. 1621 of 2007 ------------------------------- OPMV.588/1986 MOTOR ACCIDENT CLAIMS TRIBUNAL, KOLLAM ........................................ APPELLANT/ADDL.4TH RESPONDENT --------- --------------------------------------------- THE ORIENTAL INSURANCE CO.LTD., QUILON, REPRESENTED BY ITS ADMINISTRATIVE OFFICER, REGIONAL OFFICE, ERNAKULAM NORTH, KOCHI-18. BY ADV. SRI.GEORGE CHERIAN (THIRUVALLA) RESPONDENTS: CLAIMANTS & RESPONDENTS 1 & 2 ---------------------------------------------------------------------------- 1. ARUNDHATHI, SREE BHAVAN, PUNNATHALA, THANGASSERI P.O., QUILON. 2. BAIJU, SREE BHAVAN, PUNNATHALA, THANGASSERI P.O., QUILON. 3. BIJU, SREE BHAVAN, PUNNATHALA, THANGASSERI P.O., QUILON. 4. BINDHU, SREE BHAVAN, PUNNATHALA, THANGASSERI P.O., QUILON. 5. T.T.JOSEPH, PRIOR MARTHOMA BHAVANAM, HOLLY CROSS, KALAMASSERY - 683 503, KERALA. 6. K.M.JOY, S/O.MATHAI, KOCHARAD HOUSE, MANJINIKARA, OMALLOOR P.O., PATHANAMTHITTA. R1 TO R4 BY ADV. SRI.T.M.CHANDRAN SRI.V.A.SASIDHARAN SRI.JOSEPH ALBIN NEDUNTHALLY SRI.A.K.JOSE THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 25/03/2008, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: ORDER ON CMP NO. 1929/2007 IN MACA NO. 1621/2007 C. DISMISSED 25/03/2008. SD/- J.B.KOSHY, JUDGE. SD/- K.HEMA, JUDGE. True copy tga J.B.KOSHY & K.HEMA, JJ. -------------------------------------- M.A.C.A.No.1621 OF 2007 ------------------------------------- Dated 25th March, 2008 JUDGMENT Koshy,J . Dependents of a motor accident victim filed an application for compensation contending that the accident occurred due to the negligence of the driver of the vehicle insured by the appellant insurance company. Tribunal accepted the above plea and awarded an amount of Rs.1,62,000/= and directed the insurance company to deposit the same. The only dispute is regarding the limit of liability pleaded by the insurance company. According to the insurance company, even though policy issued was a comprehensive policy, liability to third party is only limited to the minimum amount mentioned in the Act. The accident occurred on 26.3.1986 when Motor Vehicles Act, 1939 was in force. At that time, third party liability was limited to Rs.50,000/= and third party property damage was limited to Rs.6,000/=. Now, we shall look into the policy. In the policy (Ext.R1) it is seen that apart from the premium for own damage following amounts are paid; liability to passengers Rs.180/=, liability to driver Rs.8/= and additional T.P Rs.240/=. Thus, after discount net premium paid is Rs.1352.70. It is further stated as follows: MACA.1621/2007 2 “Limits of Liability : Limit of the amount of the Company's liability under Section II-1(i) in respect of any one accident: Such amount as is necessary to meet the requirements of the Motor Vehicles Act, 1939. Limit of the amount of the Company's liability Under Section II-1(ii) in respect of any one claim or series of claims arising out of one event: Rs.50,000.” The contention of the insurance company is that under Section II(1)(i) it is specifically stated that company's liability is limited to such amount as is necessary to meet the requirements of the Motor Vehicles Act,1939. Therefore, according to the appellant, third party liability is limited to Rs.50,000/=. It is true that as per Ext.R3, if `Act policy' was taken, premium is only Rs.200/=. Here Rs.240/= was collected as third party premium. Third party property liability in `Act policy' is only Rs.6,000/=. But, here, as per the policy, because of the additional premium that liability is extended to Rs.50,000/=. Ext.R3 is the Agent's Mannual wherein it is stated that comprehensive premium is own damage premium plus third party premium and third party premium is Rs.240/=. The above Ext.R3 shows hints to agents and inspectors and in comprehensive policy minimum amount that has to be taken is mentioned. Policy is in a printed form for comprehensive policies and policy itself states MACA.1621/2007 3 that Rs.240/= is collected for third party liability. It is the contention of the appellant that by paying that, company's liability is limited to meet the requirements of the Motor Vehicles Act in the case of third party liability and property damages up to Rs.50,000/=. According to the respondents, as found by the Tribunal for covering the Act policy liability limited to Rs.50,000/= to third party, premium was only Rs.200/-. Rs.40/= was collected as additional third party (Additional TP) to cover third party liability without limit. Alternate contention of the respondents is that the omni bus involved in the accident is not a vehicle in which passengers are carried for hire or reward. Section 95 on the relevant date reads as follows: “95. Requirements of policies and limits of liability.- (1) xx xx xx (2) Subject to the proviso to sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely- (a) where the vehicle is a goods vehicle, a limit of one lakh and fifty thousand rupees in all, including the liabilities, if any, arising under the Workmen's Compensation Act, 1923 (8 of 1923), in respect of the death of, or bodily injury to, employees (other than the driver), not exceeding six in number, being carried in the vehicle; (b) 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,- MACA.1621/2007 4 (i) in respect of persons other than passengers carried for hire or reward, a limit of fifty thousand rupees in all; (ii) in respect of passengers, a limit of fifteen thousand rupees for each individual passenger; (c) save as provided in clause (d), where the vehicle is a vehicle of any other class, the amount of liability incurred; (d) irrespective of the class of the vehicle, a limit of rupees six thousand in all in respect of damage to any property of a third party. (3)-(4) xx xx xx (4-A) xx xx xx (5) xx xx xx” Since section 95(2)(c) is applicable in this case as the vehicle involved is not a vehicle carrying passengers for hire or reward. It belongs to religious organization. It is true that the Omnibus involved in the accident is registered for carrying 15 + 1 passengers. But, since the vehicle is not carrying or intended for carrying passengers for hire or reward or in pursuance of a contract of employment, it will not come under section 95(2)(a) or (b). It is intended for the members of the institution. In this connection, we refer to the decision of the Supreme Court in Jameskutty Jacob v. United India Insurance Co. Ltd. and others ((2003) 7 SCC 131) in which the Apex Court held as follows: MACA.1621/2007 5 “We are informed by the counsel for the appellant that there is no evidence on record to show that the vehicle was a taxi. We, therefore, fail to understand on what basis the High Court has restricted the liability of the Insurance Company to Rs.50,000. In view of the fact that it has not been shown to us that the vehicle was a taxi, the case would be covered by Section 95(2)(c) and the liability of the Insurance Company would be the amount of liability incurred, even though it is an “act only” policy.” Here, even if the liability is limited as per the Act, this will correctly come under section 95(2)(c) and the entire third party liability is to be paid by the insurance company. Hence, we see no ground to interfere in the matter. In view of the stay order only 50% of the amount awarded was deposited by the insurance company. Balance amount with interest also should be deposited within two months from today. The appeal is dismissed. J.B.KOSHY JUDGE K.HEMA JUDGE tks