1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELATE JURISDICTION FIRST APPEAL NO.1535 OF 2009 The National Insurance Co.Ltd. Kamani Chambers, 32, R.K.marg, Mumbai 400 038. Policy No.281801/31/04/6319632 valid from 22.2.2005 to 21.2.2006 Through RO-II, 5th floor, Sterling Cinema Bldg., Mumbai-I .. Appellant V/s. 1.Smt.Vrushali Sitaram Gavnang, aged 28 yrs, widow of the deceased 2.Miss Sanika Sitaram Gavnang, aged 1 yr. Minor duaghter of deceased 3.Smt.Anandibai Harishchandra Gavnang aged 66 yrs, mother of the deceased Residing at 306/B, Sanket CHS, Anand Nagar, Near Vakola Police Stn, Santacruz (W), Mumbai 400 055. 4.Mr.Narendrasingh Dari, Bailarpur, Dist-Chandrapur, Maharashtra 442 401. 5.M/s.Patel Travel Services P/1358, Kenson Gowdown, Near Ekta Hotel, Sarkhej Bavia Rd, Dist: Ahmedabad. 6.The New India Assurance Co.Ltd. Noble Ashram Road, Opp.Nehru Bridge Ahmadabad  380009 Policy No.210100/31/05/01/00013585 validity  27.11.2005 to 26.11.2006 (Owner and Insurer of M/Luxury bearing No.GJ/01-XX-8998. .. Respondents WITH FIRST APPEAL NO 1534 OF 2009 The National Insurance Co.Ltd. Kamani Chambers DO 5, R.K.Marg, Mumbai 38. Policy No.281801-31-04-6319632 valid from 22.2.05 to 21.2.06 2 Through RO-II, 5th floor, Sterling Cinema Building, Mumbai-1. .. Appellant V/s 1.Mr.K.N.Raghavan,Aged 60 yrs, father of deceased, 2.Mrs.Nalini K.N.Raghvan, Aged 48 years mother of deceased, 3.Ms.Anita K.N.Raghvan, Aged 20 yrs, sister of deceased, All R/at D-233 Chawl No.15, Punjabi Colony, G.T.B.Nagar, Mumbai 400 037. 4.M/s.Patel Travel Services, P/1358, Kenson Godown, Sarkhej Bavala Rd. Near Ekta Hotel, Ahmedabad, A/2, Puspanjali Flat, Near Paldi, Ahmedabad, (owner of Volvo Bus No.GJ-01-XX-8998) 5.Mr.Narendra Singh Duri, Ballar Pure, Dist.Chandrapur, Maharashtra 442 401. (Owner of M.Truck No.MH-34-M-2586) 6.New India Assurance Co.Ltd. CDU-1, (210 100) 1st Floor, Nobel Ashram Road, Ahmadabad. Policy No.210100/31/05/1/000/3505 valid from 27.11.2005 to 26.11.2006 Insured of Bus No.GJ-01-XX-8998 .. Respondents Mr.Indrajeet R.Kulkarni for the Appellnats. Mr.M.B.Kotak for Respondent Nos.1 to 3. CORAM : R.G.KETKAR, J. DATE : 2nd JULY, 2010 JUDGMENT: 1.The National Insurance Company Limited 3 (hereinafter referred to as the Insurer) has preferred these two appeals. First Appeal 1535 of 2009 arises from the judgment and order dated 18th February, 2008 below Exh.2 in Claim Application No.860 of 2006 passed by the learned Member of the Motor Accident Claims Tribunal, Mumbai (for short the Tribunal), whereby the Tribunal allowed the application made by the Respondent Nos.1 to 3 (hereinafter referred to as the claimants) u/s.140 of the Motor Vehicles Act, 1988 (for short the Act). 2.First Appeal No.1534 of 2009 arises from the judgment and order dated 5th April, 2008 below Exh.2 in Claim Petition No.2267 of 2006 passed by the learned Member of the Motor Accident Claims Tribunal, Mumbai (for short the Tribunal), whereby the Tribunal allowed the application made by the Respondent Nos.1 to 3 (hereinafter referred to as the claimants) u/s.140 of the Act. Since common questions of law and facts arise in both the appeals, they can be 4 conveniently disposed of by this common order. 3.Heard Mr.Kulkarni, learned counsel for the appellant-Insurer and Mr.Kotak, learned counsel for the claimants at length. Mr.Kulkarni submitted that u/s.140 of the Act, the liability to pay the compensation is saddled only on the owner of the vehicle or as the case may be the owners of the vehicles. There is no scope to implicate the Insurance Company even if the vehicle was covered under the valid insurance policy at the time of the accident. In support of this submission, Mr.Kulkarni relied upon several decisions which will be referred to at the appropriate place. He further submitted that Section 140 as well as Section 144 of the Act fall in Chapter X of the Act. Section 144 provides that the provisions of the Chapter X shall have effect notwithstanding anything contained in any other provision of the Act or any other law for the time being in force. He 5 therefore submitted that Section 140 of the Act has overriding effect on the other provisions of the Act. Finally he submitted that where the words of the statute are absolutely clear and unambiguous, recourse cannot be had to the principles of interpretation other than the literal rule. In other words, his submission is that the words  Insurance Company cannot be read into section 140 so as to saddle the Insurance Company with a liability for payment of compensation thereunder. 4.On the other hand, Mr.Kotak, learned counsel for the claimants submitted that even if the words  Insurance Company are not found in Section 140 of the Act, none the less Section 140 is construed by this Court as well as by the Apex Court whereby it is held that even the Insurance Company is liable to pay the compensation jointly and severally. He further invited my attention to the Maharashtra Motor Vehicles Rules, 1989 (for short the Rules) and in particular Rule 281 6 thereof 5.Mr.Kulkarni, learned counsel for the Insurer in support of his submissions that u/s.140 of the Act only the owner or as the case may be the owners of the Vehicle/s are liable to pay the compensation and not the Insurance Company, relied upon the following decisions:- (1) Smt.Bani Rani Das V/s.Manager, National Insurance Company Limited and Another, 2007 (4) T.A.C.126 (Cal.), (2) United India Insurance Company Limited V/s.Smt.Puti Mahato & Others, 2007 (4). T.A.C.161 (Cal.), (3) Deepal Girishbhai Soni & Others V/s.United India Insurance Company Ltd., 2004 ACJ 934, (4) Yallwwa (Smt.) and Others V/s.National Insurance Company Ltd.& Another, (2007) 3 SCC (Cri) 247, (5) National Insurance Company Ltd., V/s.Jethuram & Others, (1999) 9 SCC 62. 6.On the other hand, Mr.Kotak, learned counsel for the claimants relied upon following judgments:- (1) Bajaj Allianz General Insurance Co.Ltd., V/s.Vaishali Shetty & Others, 2008 ACJ 2642, 7 (2) Oriental Fire & General Insurance Co.Ltd., V/s.Alixo Fernandes, 1986 ACJ 1137, (3) Shivaji Dnyanu Patil V/s.Vatsala Uttam More, 1991 ACJ 777. (4) National Insurance Co.Ltd., V/s.Nicolletta Rohatgi & Ors, 2002 ACJ 1950, (5) Oriental Insurance Co.Ltd.V/s.Inderjit Kaur & Ors., 1998 ACJ 123. 7.Before I consider the submission made by the learned counsel for the parties, in the light of various decisions cited at the Bar, it would be relevant to note the provisions of the Act and the Rules. Section 140 of the Act provides that where the death or permanent disability of any person is resulted from the accident arising out of the use of the motor vehicle or motor vehicles, the owner of the vehicle shall or as the case may be the owners of the vehicles shall jointly and severally be liable to pay compensation in respect of such death or disablement. The amount of compensation in respect of death of any 8 person shall be a fixed sum of Rs.50,000/- and the amount of compensation in respect of permanent disablement of any person shall be a fixed sum of Rs.25,000/-. The application made u/s.140 is based on the principle of  no fault liability . Section 144 of the Act lays down that the provision of Chapter X shall have effect notwithstanding anything contained in any other provision of the Act or any other law for the time being in force. Section 145(c) of the Act defines liability as under:- In this chapter, - (c) liability , wherever used in relation to the death of or bodily injury to any person, includes liability in respect thereof under section 140. 8.Sub-section (5) of Section 147 lays down that notwithstanding anything contained in any law for the time being in force, an Insurer issuing a policy u/s.147, shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability, which the policy purports to cover in the case of that person or those 9 classes of person. 9.Section 149 of the Act speaks of duty of Insurer to satisfy judgments and awards against the persons insured in respect of third party risk and lays down that when a judgment in respect of any liability as is required to be covered by the policy under clause (b) of sub-section (1) of Section 147, is obtained against any person insured by the policy, then, the Insurer shall pay to the person entitled to the benefit of the decree in a sum not exceeding the sum assured as if he were the judgment debtor in respect of that liability together with any amount payable in respect of the costs or any sum awarded by way of interest. 10.Section 165 of the Act provides for constitution of the Claims Tribunal and sub- section (1) thereof reads as under:- 165 Claims Tribunal  (1) A State Government may, by notification in the Official Gazette, constitute one or more Motor Accidents Claims Tribunals (hereinafter in this Chapter referred to as Claims Tribunal) for such area as may be specified in the notification for the 10 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 motor 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 11.Section 176 of the Act empowers the State Government to make rules for the purpose of carrying into effect the provisions of Sections 165 to 174 and in particular such rules may provide among others, the following matters viz. Form of application for claims for compensation and the particulars it may contain and the fees, if any, to be paid in respect of such application. In exercise of powers conferred by Sections 26, 28, 38, 65, 107, 111, 138, 159, 176 and 203 of the Act read with Section 22 of the General Clauses Act, 1897 and all other powers enabling it in this behalf, the Government of Maharashtra 11 made the rules. Rule 281 of the Rules provides that the Claims Tribunal shall proceed to award the claim of compensation under sections 140 and 163-A, among others, on the basis of insurance certificate of policy relating to the insurance of the vehicle against the third party risk; or certificate regarding the insurance particulars of the vehicle from Regional Traffic Office or the police. Sub-rule 2 of Rule 281 lays down that the Claims Tribunal in passing order shall make the award of compensation in respect of death and in respect of permanent disablement, to be paid by the Insurer or owner involved in the accident. 12.Sub-rule 3 thereof further provides that the Claims Tribunal in passing the order under sub-rule 2 shall direct the Insurer or owner of the vehicle involved in the accident to pay the amount of compensation to the claimants within two weeks from the date of the said order. 12 13.In the case of Orient Fire & General Insurance Company Ltd.V/s.Alixo Fernandes (supra), the learned Single Judge of this Court considered the provisions of the Motor Vehicles Act 1939 (old Act) and in paragraph No.8 held thus:- 8. So a combined reading of section 92- A, sub-section (5) of Section 95 and section 96 of the Act it is clear that the insurer has to indemnify a person who is covered under a policy and if he is required to satisfy a judgment made against such person even pay directly the third party (claimant), I am therefore unable to accept that the insurer is or can be excluded from the liability to pay under section 92-A. What emerges from the above-cited provisions of the Motor Vehicle Act is that it is really speaking not a question of insurer being omitted from section 92-A. Likewise reading the word  insurer in section 92-A is not necessary. Section 92-A casts liability on the owner of the vehicles. By virtue of the cover of insurance the insurer is bound to pay the awarded amount. It is therefore clear that the mention of the word  insurer in that section is really not necessary and the argument of the appellant should therefore fail. This interpretation lends support inasmuch as section 93 has been amended by the incorporation of another sub-clause (ba) where the word  liability has been explained. This sub-clause states liability wherever used in relation to the death or bodily injury to any person includes liability under section 92-A. Coming back to sub-section (5) of section 13 95 it speaks of insurer indemnifying the person or classes of persons specified in the policy in respect of any liability (emphasis added). Mere omission of the word insurer in section 92-A cannot exclude insurer from the liability as long as the vehicle involved in the accident is duly covered by a certificate of insurance granted by the insurer. 14.In the case of Bajaj Allianz Insurance Co.Ltd.V/s.Vaishali Shetty & Ors.(supra), the learned single Judge of this Court, after considering the judgment of the Apex Court in the case of Yallwwa held that the very fact that the Apex Court has held that a defence under sub-section (2) of Section 149 of the Act is available to the Insurer in a claim petition under section 140 shows that the Insurer is liable under the statute to satisfy the award made u/s.140 of the Act against the insured. 15.Mr.Kulkarni, learned counsel relied upon the Division Bench Judgment of the Calcutta High Court in the case of Smt.Bani Rani Das (supra). Paragraph 10 of the said judgment reads as under:- Now comes the question as to who would be 14 called upon to pay the compensation amount of Rs.50,000/- as provided in Section 140 of the Motor Vehicles Act and in this regard, following the submission of Mr.Das and on careful examination of the statutory provisions of Section 140 of the Motor Vehicles Act itself, we have no doubt in mind that the statute never placed any liability on the Insurance Company even if the vehicle is covered under valid insurance policy to pay the amount and the statute clearly placed the responsibility on the owner to pay the compensation and this legal point was further clarified both in the case of National Insurance Company Ltd.v.Jethu Ram & Others (supra) and National Insurance Company Ltd.v.Smt.Krishna Biswas, (supra). 16.He also relied upon the judgment of the learned single Judge of the Calcutta High Court in the case of United India Insurance Company Limited V/s.Smt.Puti Mahato & Ors. (supra). In paragraph No.11 of the said judgment, the learned Single Judge held that the Insurance Company neither can be made a party in the proceedings u/s.140 of the Act, nor any liability could be fixed upon their shoulder. 17.Perusal of these judgments indicates that the said judgments were rendered following the judgment of the Apex Court in the case 15 of National Insurance Company Limited V/s.Jethuram & Ors.(supra). In that case the appeals were preferred by the Insurer against the judgment of Himachal Pradesh High Court in an appeal under the old Act. The Motor Accident Claims Tribunal, after perusing the material produced before it, came to the conclusion that under the policy of insurance, the insurer was not liable to pay compensation in question and had finally awarded compensation to the claimants to be recovered from the owner of the vehicle. During the pendency of the proceedings by virtue of the statutory liability accruing u/s.92-A of the old Act, the payments were made by the Insurer to the extent of Rs. 15,000/- in case of death and to the extent of Rs.7,500/- in case of permanent disablement. The Tribunal though held that the Insurer is not liable under the policy of Insurance to pay the compensation in question, as provided under Chapter VII-A and more particularly u/s.92-A of the old 16 Act, held that the said amount has to be borne by the Insurer and the owner will not be liable to pay the said amount. The matter was carried to the High Court, which held that the liability u/s.92-A of the old Act is independent of the liability to pay the compensation u/s.110-A and therefore such liability arising out of Section 92-A has to be borne by the Insurer. While allowing the appeal, it was observed in paragraph No.2 of the judgment of the National Insurance Co.Ltd.v/s.Jethu Ram & Others as under:- On a close scrutiny of the aforesaid provisions, we do not find anything contained therein which would suggest that the liability which accrues under the provisions of Section 92-A has to be borne by the insurer even if it is ultimately held that under the policy of insurance the insurer is not liable to pay the compensation in question. In our considered opinion the Tribunal and the High Court have misread the aforesaid provisions of the Motor Vehicles Act. In the aforesaid premises the impugned judgment of the Tribunal and High Court cannot be sustained so far as it relates to the liability of the insurer arising under Sections 92-A and 92-B of the Act. These appeals are allowed. The Insurer having paid the amount under the aforesaid provisions is entitled to get it reimbursed from the owner. 17 18.In that case ultimately it was held that under the policy of insurance, the insurer was not liable to pay the compensation and therefore, there is no liability accrued under the provisions of section 92-A, which has to be borne by the insurer. 19.In the present case, the main claim petitions filed by the claimants are pending and we are at the stage of interim award u/s.140 of the Act. In my opinion, the judgment of the Apex Court in the case of National Insurance Company Ltd.V/s.Jethuram & Ors.(supra) is not applicable. In view of the judgments of the learned Single Judges of this Court in the case of Oriental Fire & General Insurance Company Ltd.V/s.Alixo Fernandes (supra) as also in the case of Bajaj Allianz Company Ltd.V/s.Vaishali Shetty & Others (supra), I am of the opinion that u/s.140 of the Act, the Insurer has to indemnify a person who is covered under a policy and he is required to satisfy a 18 judgment made against such person in terms of Section 147 (5) of the Act. Having due regard to Section 145 (c) of the Act, wherever the term liability is used in relation to the death of or bodily injury to any person, it includes liability in respect thereof under Section 140 of the Act. I respectfully do not agree with the Division Bench judgment of the Calcutta High Court in the case of Smt. Bani Rani Das and the judgment of the learned Single Judge in the case of United Insurance Company Ltd. (supra). 20.Mr.Kulkarni submitted that in the case of Deepal G.Soni (supra) it was observed in paragraph 37 that whereas in terms of section 140 of the Act, the statutory liability has been cast upon the owner in case of death or permanent disablement, both u/s.163-A and section 166 of the Act, the insurer had been made responsible. He therefore submitted that the Apex Court in that case has held that the statutory 19 liability u/s.140 of the Act is upon the owner and not the Insurer. In that case the Appellants before the Apex Court had filed two claim petitions; one u/s.163-A and other u/s.166 thereof claiming compensation for a sum of Rs.4,97,800/- on account of death of their mother Prabhaben as also a sum of Rs. 17,30,900/- on account of death of their father Girishbhai. The learned Tribunal considered the matters on their own merits and also proceeded on the basis that in terms of section 163-A of the Act, merely an interim relief was to be granted and accordingly, the learned Tribunal by order dated 24th March, 2000 awarded Rs.4,20,500/- and Rs.11,74,500/- respectively with interest @ 12% p.a.from the date of the application till realisation. The Tribunal further directed that the applications filed by the Appellants purported to be u/s.166 of the Act would be determined separately. The Insurance Company preferred appeals before the High Court of Gujrat at Ahmedabad. 20 Having regard to the concession made at the bar to the effect that in view of the cap of annual income of Rs.40,000/- as contained in the Second Schedule appended to the Act, the awarded amount was reduced to Rs.3,24,500/- from Rs.4,20,500/- and to Rs.3,78,500/- from Rs.11,74,500/- respectively. It was argued on behalf of the appellants that the concept of  no fault liability is envisaged both under Section 140 and Section 163-A of the Act and the proceeding thereunder being alternative to each other providing for identical rights and liabilities, an order under section 140 being not final, there is no reason as to why an award made under section 163-A should be treated to be final. The Apex Court observed that payment of the amount in terms of section 140 of the Act, is ad-hoc in nature. The claim made thereunder is in addition to any other claim which may be made under any other law for the time being in force. Section 163-A does not contain any such provision. In terms of 21 section 163-B of the Act, an option is provided to the claimant to make a claim for compensation either u/s.140 or section 163-A and not under both. 21.In paragraph No.68 of the said judgment, the Apex Court recorded that the parties have proceeded to file two applications; one u/s.163-A and another u/s.166 of the Act. Both the claims were entertained. The Tribunal and the High Court proceeded on the basis that the amount of compensation u/s. 163-A is by way of an interim award and the same would not preclude the claimants to proceed with his claim made in terms of section 166 of the Act. The Apex Court accepted the submission made on behalf of the appellants that the claim made by them u/s.163-A be treated to be one u/s.140 of the Act and upon adjusting the amount provided for thereunder, the Appellants would refund the rest thereof to the Insurer. The Division Bench of the Apex Court by order dated 19th April, 2002 22 doubting the correctness of two Judges Bench decision in Oriental Insurance Company Limited V/s.Hansrajbhai V.Kodala 2001 ACJ 827 (SC) had referred the matter to the three Judges Bench for considering whether the proceedings u/s.163-A of the Act are final proceedings, as a result whereof the claimants would be debarred for proceeding further with the claim made on the basis of fault liability in terms of Section 166 thereof. In paragraph No.51 the Apex Court after considering the scheme as envisaged u/s.163-A of the Act held that the rights and obligations of the parties are to be determined finally. It was further observed that the remedy for the payment of compensation both u/s.163-A and 166 being final and independent of each other as statutorily provided, a claimant cannot pursue his remedies thereunder simultaneously. One must opt or elect to go either for proceeding u/s.163-A or u/s.166 of the Act, but not under both. Thus the 23 controversy before the Apex Court in the case of Deepal Girishbhai Soni (supra) was in the context of Section 163-A vis-a-vis Section 166 of the Act. The Apex Court, however, did not lay down that u/s.140 of the Act, the Insurer is not at all liable to pay the compensation. I am therefore of the opinion that the reliance placed by Mr.Kulkarni onthe decision of Deepal G.Soni (supra) is mis-conceived. 22.He further submitted that in Yallwwa s case (supra), the Supreme Court has observed in paragraphs 10 & 11 as under: 10. Section 140, as noticed hereinbefore, provides for no fault liability. It uses the words accident arising out of the use of a motor vehicle the owner of a vehicle and when more than two vehicles are involved, the owners of the vehicles shall, joint and severally, be liable to pay compensation. The said provision, therefore, makes the owners of the vehicles liable but not the insurer per se. Irrespective of the