IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Appeal From Order No. 290 of 2006 National Insurance Company Ltd. … Appellant Vs Smt. Kanwari Devi & 3 others … Respondents Sri K.K. Shah, learned counsel for the appellant Sri G.S. Negi, learned counsel for the respondents Hon’ble B.C. Kandpal, J. This appeal under Section 173 of the Motor Vehicle Act, 1988 has been filed by the appellant against the judgment and award dated 14.02.2006 passed by M.A.C.T./District Judge, Rudraprayag in M.A.C. No. 10 of 2005 whereby the Tribunal awarded a sum of Rs. 4,22,000/- against the Insurance Company. 2. Brief facts of the case are that the deceased – Bharat Singh was a registered owner as well as driver of vehicle No. UA07/6997 (Tata Specio). On 15.10.2004, when the deceased was coming from Gaurikund to Gauchar the vehicle met with an accident near the place of Kungarh due to the technical defects and the deceased Bharat Singh died at the spot. The deceased was a young man and suffered the all expenses of is family. The said vehicle of the deceased was insured for the amount of Rs. 2,40,000/- with opposite party i.e. The National Insurance Company Ltd. The deceased was also insured for the amount of Rs. 2,00,000/-, hence the claimants filed the claim petition of Rs. 4,15,000/- as compensation. 2 3. The National Insurance Company contested the claim petition by filing its written statement. It has alleged that the deceased was himself the owner of the vehicle while the owner of the vehicle cannot self drive his vehicle. It has further alleged that the expenditure shown in the claim petition has not been proved by any documentary evidence. It has also alleged that at the time of accident the driver of the vehicle has no valid driving licence. So the claim petition was liable to be dismissed against the Insurance Company. 4. On the basis of the pleadings of the parties, the Tribunal has framed following issues:- 1. Whether the accident occurred in which the vehicle No. UA07/6997 Tata Specio (Maxi Cab) met to an accident causing the death to Bharat Singh? 2. Whether all papers of the vehicle were updated and the driver has valid driving licence? 3. Whether both the claim i.e. the claim of accident damaged vehicle and compensation due to the death of deceased can be granted by this petition? 4. For what amount of compensation the claimants are entitled from the Insurance Company? 5. Both the parties led the evidence in support of their cases. The Tribunal discussed above issues in great 3 detail. After hearing learned counsel for the parties and perusing the entire material available on record, the Tribunal decreed the claim petition to the tune of Rs. 4,22,000/- against the Insurance Company vide judgment and award dated 14.02.2006. 6. Feeling aggrieved by the aforesaid judgment and award, the Insurance Company preferred this appeal before this Court. 7. Heard Sri K.K. Shah, learned counsel for the appellant, Sri G.S. Negi, learned counsel for the respondents and perused the record. 8. Learned counsel for the appellant has confined his arguments that the Tribunal has fell in error in awarding a sum of Rs. 2,15,000/- under the head of damage of vehicle. He has invited my attention towards the provision of Section 147 read with Section 165 of the Motor Vehicle Act and has submitted that the amount under the head of damage of vehicle could not have exceeded more than Rs. 6,000/- in any case to the third party. 9. Learned counsel for the claimant/respondent has argued that the Tribunal has discussed the provision of Section 165 of the Motor Vehicle Act and thereafter come to the conclusion that the amount under the head of damage to the vehicle to third party comes to Rs. 2,15,000/- and the impugned judgment and award suffers with no infirmity. 4 10. In order to decide the question in hand, it would be relevant to read Section 147 as well as Section 165 of the Motor Vehicle Act, which reads as under:- “147. Requirements of policies and limits of liability. –(1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which- (a) is issued by a person who is an authorized insurer; and (b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)- (i) against any liability which may be incurred by him in respect of the death of or bodily (injury to any person, including owner of the goods or his authorized representative carried in the vehicle) or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place; (ii) 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; Provided that a policy shall not be required- (i) to 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 insured sustained by such an employee arising out of and in the course of his 5 employment other than a liability arising under the Workmen’s Compensation Act, 1923 (8 of 1923), in respect of the death of, or bodily injury to, any such employee- (a) engaged in driving the vehicle, or (b) if it is a public service vehicle, engaged as a conductor of the vehicle or in examining tickets on the vehicle, or (c) if it is a goods carriage, being carried in the vehicle, or (ii) to cover any contractual liability. Explanation.- For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in public place. (2) Subject to the proviso to sub-section (1), a policy of insurance referred to in sub-section (1), shall cover any liability incurred in respect of any accident, up to the following limits, namely:- (a) save as provided in clause (b), the amount of liability incurred. 6 (b) in respect of damage to any property of a third party, a limit of rupees six thousand. Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier. (3) A policy shall be of no effect for the purposes of this Chapter unless and until there is issued by the insurer in favour of the person by whom the policy is effected a certificate of insurance in the prescribed form and containing the prescribed particulars of any condition subject to which the policy is issued and of any other prescribed matters; and different forms particulars and matters may be prescribed in different cases. (4) Where a cover note issued by the insurer under the provisions of this Chapter or the rules made thereunder is not followed by a policy of insurance within the prescribed time, the insurer shall, within seven days of the expiry of the period of the validity of the cover note, notify the fact to the registering authority in whose records the vehicle to which the cover note relates has been registered or to such other authority as the State Government may prescribe. 7 (5) Notwithstanding anything contained in any law for the time bring in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons. Corresponding Law – Section 147 corresponds to section 95 of the Motor Vehicles Act, 1939. Objects and reasons – Clause 147 lays down the requirements of the policies and the limit of liability in respect of passengers and persons other than passengers in relation to passenger vehicles and goods carriages. Scope – Requirements enjoined by section 147 in relation to use of particular vehicle – Section 147 enjoins upon the insurer certain requirements in relation to the use of particular vehicle. They are (1) the policy must specify the persons or class of persons who are insured with respect to their liability to third party (2) the policy must specify the extent of liability which must extend to the extents specified in sub-S(2), and (3) the liability which may be incurred by the specified persons or class of persons in respect of death or bodily injury to any person caused by or arising out of the use of the vehicle insured in a public place. 8 Section has to be given wider, effective and practical meaning – S-147 is quite comprehensive in scope and meaning. It is to be given wider, effective and practical meaning so that the object of the Legislature which was faced with divergent views of various Courts of the country giving different interpretation to the provisions of S – 95 of the 1939 Act causing immense harm to many categories of persons by disentitling them from claiming compensation either from the insurer or the insured or both, in the facts and circumstances of the case, is given effect to. New provision, therefore, covers such kind of cases as well. The Legislature clearly intended that every policy of insurance is statutorily required to cover the risk of liability in respect of classes of persons relating to all types of vehicles without exception and with no defence to the insurance company disclaiming, the liability with respect to particular class of persons or particular kind of vehicles. Person specified in policy need not necessarily be a registered owner- Section 147 deals with requirements of policies and limits of liability. In Cl (b) of sub- Section (1) of Section 147, it is provided that in order to comply with the requirement of this Chapter, a policy of insurance must be policy which insures the person or classes of persons specified in the policy to the extent specified in sub Section (2). This provision does not qualify that the person or classes of persons specified in the policy must be a registered owner. 9 Time from which insurance policy to be operative – In absence of specific mention of time, policy becomes effective from previous midnight – Should there be no contract to the contrary, an insurance policy becomes operative from the previous midnight, when bought during the day following. However, in case there is mention of a specific time for its purchase then a special contract to the contrary comes into being and the policy would be effective from the mentioned time. 165 Claims Tribunals-(1) A State Government may, by notification in the Official Gazette, constitute one or more Motor Accidents Claims Tribunals (hereafter in this Chapter referred to as Claims Tribunal) for such area as may be specified in the notification for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of mother vehicles, or damages to any property of a third party so arising, or both. Explanation:- for the removal of doubts, it is hereby declared that the expression “claims for compensation in respect of accidents involving the death of or bodily injury to persons arising out of the use of motor vehicles” includes claims for compensation under section 140. (2) A Claims Tribunal shall consist of such number of members as the State Government may think 10 ft to appoint and where it consists of two or more members, one of them shall be appointed as the Chairman thereof. (3) a person shall not be qualified for appointment as a member of a Claims Tribunal unless he- (a) is, or has been, a Judge of a High Court, or (b) is, or has bee, a District Judge, or (c) is qualified for appointment as a High Court Judge (or as a District Judge) (4) Where two or more Claims Tribunals are constituted for any area, the State Government, may by general or special order, regulate the distribution of business among them. Corresponding Law – Section 165 corresponds to section 110 of the Motor Vehicles Act, 1939. Objects and Reasons – Clause 165 empowers the State government to constitute Claims Tribunals to adjudicate upon claims for compensation arising out of motor vehicle accidents, resulting in death or bodily injury to persons or damages to any property of third party. Where a bomb exploded inside the bus of the Assam State Transport Corporation just before it reached its last stoppage and the passengers were alighting, held, in the absence of the usual police escort 11 and despite the atmosphere during the period of the accident being so polluted that the conductor and the driver ought to have taken special care, the accident had undoubtedly arisen out of the use of the motor vehicle and the injured was entitled to compensation therefore.” 11. The bare reading of the aforesaid provision, it is quite clear that as far as damage of property of third party which would not be granted by the Tribunal more than the tune of Rs. 6,000/-. In view of the provisions quoted above, the approach adopted by the Tribunal appears to be wrong. 12. I therefore, direct that the appellant – National Insurance Company Ltd. is liable to pay the amount under the head of damage of vehicle to third party to the tune of Rs. 6,000/- only, rest of the amount invested for repairing to the damage of vehicle can be recovered by the claimant by adopting the proper forum. 13. With the aforesaid observation, the appeal is partly allowed. The impugned judgment and order dated 14.02.2006 passed by the Tribunal is modified upto the extent that the claimants are entitled for a sum of Rs. 2,07,000/- as compensation (2,00,000/- towards Insurance + 2,000/- towards funeral expenses + 5,000/- towards loss of consortium) along with interest as mentioned by the Tribunal in the impugned judgment and award, instead of Rs. 4,22,000/- as has been awarded by the Tribunal. It is open for the claimant/respondent to approach before the appropriate legal forum for recovery of the rest of the amount for damage of the vehicle. 12 (B.C. Kandpal, J.) 06.06.2008 ASWAL