1 FA : 645/2011 IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION . 645 2011 FIRST APPEAL NO OF WITH .2712 2002 CIVIL APPLICATION NO OF Vijaykumar Rajaram Narale .... Appellant . Vs . . Smt Malan Dnyanu Misal & Ors .... Respondents . , / . . . , . Mr Rohan Darandale h f Mr R S Datar Advocate for appellant . . . / . . . , . .3. Mr S S Vidyarthi i by Mr S M Vidyarthi Advocate for resp no : . . . , . Coram Smt R P SondurBaldota J : 4 2011 Date th May . .: P C 1. 2001, This appeal filed in the year coming up for admission in the 2011, 140 year challenges the order passed by the Tribunal under Section Motor Vehicles Act awarding compensation on the basis of no fault liability .1 .3, to respondents no and exonerating respondent no the Insurance , Company from the liability on the ground that the appellant the owner of the offending vehicle has committed breach of the terms and conditions . of the insurance policy 2. . , Mr Darandale the learned counsel for the appellant submits that .3 the Tribunal had erred in exonerating respondent no from payment of compensation on the basis of “no fault liability” because unless .3, respondent no insurer establishes breach by producing the necessary , , evidence in support of thereof at the time of trial it cannot be absolved 2 FA : 645/2011 . from responsibility of payment of compensation Secondly according to , him permitting the insurer to raise defence of breach of terms of the insurance policy at the interim stage of award of compensation under 140 Section Motor Vehicles Act would frustrate the legislative intent of . introducing the concept of “no fault liability” 3. .3 The breach alleged by respondent no on the part of the appellant . is that the appellant had used the goods vehicle for carrying persons . . . The copy of the F I R produced by the claimants before the Court shows , that the tempo meant for carrying goods was jampacked to its capacity . 35 40 . by persons There were to persons travelling in the tempo The police have prosecuted the appellant for causing accident and for carrying . such large number of passengers in a goods vehicle In view of the . . ., contents of the F I R the Tribunal found that there is breach of policy . committed by the appellant It noted that carrying passengers in goods , vehicle is prohibited and if the passengers are carried the insurance . company is required to be absolved 4. , In view of the above facts there can be no substance in the submission that the insurance company must establish the breach by . bringing necessary evidence before the court 5. , As regards the second part of the argument the learned counsel for the appellant relies upon decision of Single Judge of Madhya Pradesh High court in the case of Harsh Malik vs. Munna Burman, reported in 2005 . . ., AC J 71 holding that the Tribunal cannot examine defences available to the . insurance company while passing interim award under “no fault liability” 10 , He particularly relies upon paragraph of the decision which reads as 3 FA : 645/2011 : under 10. “ , , Looking to the statutory scheme if the vehicle is insured . the natural liability would fall on the insurer Permitting the insurer at that stage to raise any defence other than one that , there is no insurance policy in force would frustrate the . legislative object in introducing the concept of no fault liability The legislative intent is to ensure that some succor reaches the victim or the dependant without going into the question which . may arise for consideration while passing the final award Simply because insurance company has taken some statutory , . , defences interim compensation cannot be denied If ultimately it is found that the insurer has been successful in establishing the defences taken by it and consequently stands exonerated then the Tribunal can issue appropriate direction enabling the insurer to recover the amount paid by it from the owner of the . vehicle The court must take into consideration the high legislative purpose sought to be served by the provisions under 140 . section of the Act” A contrary view is seen to have been taken by the Division Bench of our High Court in New India Assurance Company Limited vs. Babasaheb Anna Mali and others, reported in 2002 642 ACJ . 8 Paragraph of the : judgment relevant for the present purposes reads as follows 8. , “ We therefore have no hesitation in holding that pillion rider of the motor cycle which was insured with the appellant was not covered under the policy of insurance which was admittedly . third party policy When the pillion rider of a motor cycle is not , covered under the policy of insurance obviously the insurer of the motor cycle could not have been saddled with the no fault 92- liability under section A even under the limited and restricted , inquiry as laid down by the Apex Court in Shivaji Dayanu Patil 1991 777 ( ). ACJ SC The learned Single Judge in the impugned 14 order particularly in para cannot be said to have rightly observed that some evidence shall have to be led by the . insurance company to make out the case that it is not liable Though the learned single Judge extensively referred to judgment of the Apex Court in Shivaji Dayanu Patil’s case and rightly appreciated the ratio laid down thereunder but erred in applying it on the facts of the case when he observed that some evidence shall have to be led by insurance company to prove that it is not liable under the policy and thereby committed an . error which deserves to be corrected by us On the face of the , third party insurance policy when pillion rider is not covered in 4 FA : 645/2011 claim of compensation made by the claimant for having sustained permanent disability while riding the motor cycle as , pillion rider which met with an accident apparently insurance company is not liable and no further material was required to be seen at the stage of consideration of application under section 92- . A to find out whether insurer was liable or not From the insurance policy it is not seen that any extra premium was paid . for coverage of pillion rider” 6. . , .2 Mr Vidyarthi the learned counsel for respondent no submits that the Apex Court has taken the same view as the Division Bench of our High Court in the case of . . . . Smt Yallwwa & Ors vs National Insurance Co . Ltd & Anr., reported in 2007 . . . 1934 AC J , the Apex Court had in paragraphs 16 21 : and observed as follows 16. “ The question which is required to be considered is what would be the meaning of the term `award’ when such a . contention is raised Although in a given situation having regard , to the liability of the owner of the vehicle a claim Tribunal need not go into the question as to whether the owner of the vehicle , in question was at fault or not but determination of the liability , , of the insurance company in our opinion stands on a different . footing When a statutory liability has been imposed upon the , , owner in our opinion the same cannot extend the liability of an , insurer to indemnify the owner although in terms of the , . insurance policy or under the Act it would not be liable therefor 21. “ . . . In National Insurance Co Ltd v Jethu Ram and others [(1999) 9 62], SCC this Court while construing the provisions of 92- 92- , 1939, : Section A and B of the Motor Vehicles Act opined 2. “ , On a close scrutiny of the aforesaid provisions we do not find anything contained therein which would suggest that the 92- liability which accrues under the provisions of Section 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 judgments of the Tribunal and the High Court cannot be sustained so far as they relate to the liability of the 92- 92- \005. insurer arising under sections A and B of the Act ” 5 FA : 645/2011 In view of the direct decisions of the Apex Court on the question of , liability of the insurance company while passing interim award the second . . , argument of Mr Darandale must also be rejected Therefore there is no . , infirmity whatsoever in the impugned order Hence the appeal is . dismissed , In view of dismissal of the First Appeal the civil application does not , . survive the same is accordingly disposed off ( . . . , .) Smt R P SondurBaldota J