FA/492120/2008 1/18 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 4921 of 2008 To FIRST APPEAL No. 4926 of 2008 With CIVIL APPLICATION No. 12012 of 2008 To CIVIL APPLICATION No. 12017 of 2008 For Approval and Signature: HONOURABLE MR.JUSTICE H.K.RATHOD Sd/- ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? YES 2 To be referred to the Reporter or not ? YES 3 Whether their Lordships wish to see the fair copy of the judgment ? YES 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? NO 5 Whether it is to be circulated to the civil judge ? NO ========================================================= NATIONAL INSURANCE COMPANY LTD. - Appellant(s) Versus BHIMSING BHAILA NAYAK & 3 - Defendant(s) ========================================================= Appearance : MS MEGHA JANI for Appellant(s) : 1, MR SK BUKHARI for Defendant(s) : 1 - 2. None for Defendant(s) : 3 - 4. ========================================================= CORAM : HONOURABLE MR.JUSTICE H.K.RATHOD Date : 15/10/2008 ORAL JUDGMENT 1. Heard learned advocate Ms. Megha Jani appearing on behalf of appellant – National Insurance Company FA/492120/2008 2/18 JUDGMENT Limited and learned advocate Mr. Sunil Mehta for learned advocate Mr. S.K. Bukhari appearing on behalf of respondents claimants. 2. The appellant Insurance Company has challenged common award passed by Motor Accident Claims Tribunal, Fast Track Court, Godhra District Panchmahals in Motor Accident Claim Petition No.569 of 1995 to 574 of 1995 dated 16th March 2007. The Claims Tribunal has awarded compensation in favour of respondents claimants with 9% interest upto 31st December 2000 and thereafter, 7.5 interest. 3. Learned advocate Ms. Megha Jani raised one contention that amount of premium received by Insurance Company in respect to two labourers only and rest of the passengers those who were travelling in truck at the time of accident, their risks are not covered under policy. Therefore, Insurance Company is not liable to pay any compensation to rest of persons except two labourers whose premium Rs.30/- have been received by Insurance Company. 4. Learned advocate Ms. Jani relied upon one decision of Apex Court in case of National Insurance Co. Ltd. v. Anjana Shyam and others reported in 2007 ACJ 2129, where, Apex Court has considered the question of overloading, where, liability of Insurance Company has been examined where bus fell in a nallah leading to death of 25 passengers and driver and 63 passengers sustained injuries. Therefore, FA/492120/2008 3/18 JUDGMENT question raised that whether Insurance Company can be held liable for all the passengers those who have been injured and died in said accident ? The contention raised by Insurance Company having insured 42 passengers, its liability is confined to passengers insured, cannot be enlarged beyond that for persons who were not at all covered by Insurance Policy and there was no obligation on the owner of vehicle to take insurance coverage for them. Therefore, question is that whether Insurance Company is liable only in respect of number of passengers for whom insurance can be taken under the Act and not in respect of other passengers involved in the accident in case of overloading. The answer is 'yes'; in terms of Section 149. The duty of Insurance Company is only to satisfy judgment and award against persons insured in respect of third party risk; Insurance Company directed to satisfy 42 awards in descending order starting from the highest of the awards and Tribunal directed to distribute the total amount deposited by Insurance Company proportionately to all the claimants and leave all the claimants to recover the balance from the owner of the vehicle. 5. Learned advocate Ms. Jani also relied upon the relevant observations made in Para 15, where, an observations made as under : “15. ...The High Court has considered only the aspect whether by overloading the vehicle, the owner had put the vehicle to a FA/492120/2008 4/18 JUDGMENT use not allowed by the permit under which the vehicle is used. This aspect is different from the aspect of determining the extent of the liability of the insurance company in respect of the passengers of a stage carriage insured in terms of Section 147(1)(b)(ii) of the Act. We are of the view that the insurance company can be made liable only in respect of the number of passengers for whom the insurance can be taken under the Act and for whom insurance has been taken as a fact and not in respect of other passengers involved in the accident in a case of overloading.“ 6. Except that, no other submission is made by learned advocate Ms. Megha Jani before this Court. 7. I have considered the submissions made by learned advocate Ms. Jani and also perused the award passed by Claims Tribunal. It is necessary to note that accident occurred on 14th May 1995. In the said accident, in all, five young persons were died. On 14th May 1995, deceaseds were going as a labourer in Truck No.GJ-17-T-8579, where, coal was loaded. Opponent No.1 was driving the truck and due to his rash and negligent driving, in Ahmedabad Highway in Khari River Pool village, the truck was turned turtle and in that accident, in all five persons were died those who were working as a laboueres in truck. This is a case of claimants before Claims Tribunal. FA/492120/2008 5/18 JUDGMENT 8. Therefore, on the basis of negligence of opponent No.1 driver, the claimants have claimed compensation from driver, owner and Insurance Company. After receiving the notice from Claims Tribunal, matter was decided ex-parte against opponent Nos.1 and 2 those who were driver and owner and Insurance Company appeared through advocate and filed reply denying the averments made in claim petition. The Claims Tribunal has examined the first question about negligence of opponent No.1 driver after considering FIR – Exh.35, panchnama – Exh.36, inquest panchnamas Exh.37 and 38, PM Notes – Exh.39 to 42 and Copy of insurance policy – Exh.43. The persons who died in accident, their father and mother and in other cases, widow have filed necessary affidavits before Claims Tribunal vide Exh.44 to 47. In their affidavits, the facts were made clear that on 14th May 1995, when accident was occurred, in that truck, deceaseds were working as labourers going to unload the goods i.e. coal because at the time when accident occurred, the coal was loaded in truck. The Claims Tribunal has come to conclusion after considering the complaint, panchnama and other evidence that accident was occurred due to rash and negligent driving of opponent No.1 driver of truck. Thereafter, Claims Tribunal has examined the matter for deciding the quantum, which is not challenged by Insurance company before this Court. The challenge is before this Court; the liability of Insurance Company in respect to other persons except two labourers. This question was raised before Claims Tribunal by FA/492120/2008 6/18 JUDGMENT Insurance Company. The contention raised before Claims Tribunal by Insurance Company was that other persons may be considered those who are travelling as unauthorised passengers or gratuitous passengers, but, they were not working as labourers and not travelling as labourers except two labourers whose premium Rs.30/- was accepted by Insurance Company. Therefore, beyond that, Insurance Company is not liable to make any payment of compensation to claimants. The truck was going from Godhra to Sevaliya, meanwhile, it was turned turtle. The question has been examined by Claims Tribunal as to whether Insurance Company is liable to pay to rest of persons except two labourers or not. 9. The Claims Tribunal has considered the decision of Bombay High Court in case of Shivraj Vasant Bhagwat v. Shevanta Dattaram Indulkar and another reported in 1997 ACJ 1014, where, Bombay High Court has considered that it is a statutory liability of Insurance Company under Section 147 when insurance was taken in that normal insurance; the six labourers are included, for that, additional premium is not necessary; meaning thereby that, if owner wants to take insurance from Insurance Company, then, by payment of normal insurance, a liability of six labourers are covered/included. Therefore, Rs.30/- which has been paid for additional premium for two labourers they are more than six not only two labourers, therefore, relying upon Bombay High Court decision and after verifying the insurance policy FA/492120/2008 7/18 JUDGMENT Exh.66, Claims Tribunal has come to conclusion that evidence led before Claims Tribunal by claimants, in which, facts proved that all the persons those who are travelling upon the truck loaded with coal, they were labourers. No rebuttal evidence was led by Insurance Company before Claims Tribunal. Therefore, contention which has been raised by Insurance Company, except two labourers, rest of persons are gratuitous passengers or unauthorised passengers, cannot be considered to be correct or cannot be believed in absence of cogent rebuttal evidence from Insurance Company. Therefore, there was no breach of insurance policy obtained by owner from Insurance Company. 10. The Claims Tribunal has also considered that in case of more than labourers are there, then, insured in insurance policy, due to that, the policy is not breached by owner. The facts proved before Claims Tribunal that persons those who were travelling were working as labourers and one fact was there that truck was loaded with coal. Therefore, Claims Tribunal has decided the matter and come to conclusion that policy was in existence on the date of accident which pertains to truck in question and there was no breach of policy and additional premium of Rs.30/- is covered additional two persons, over and above, those labourers who are covered from initial premium of truck paid by insured to Insurance Company. Therefore, Claims Tribunal has decided that Insurance Company is liable to pay compensation to FA/492120/2008 8/18 JUDGMENT claimant. 11. The decision of Apex Court which has been relied upon by learned advocate Ms. Jani which is pertaining to overloading vehicle, where, a specific insurance per passenger is obtained by owner and if more than passengers were travelling, then, Apex Court has come to conclusion that liability is depend upon insurance obtained by owner for per passenger not beyond that. Therefore, the facts of that case are not applicable to the facts of the present case, because, in this case, persons those who were travelling were not passengers, but, they are labourers and labourers were working on the truck as an employees of owner. Against this evidence of claimant, there was no rebuttal evidence led by Insurance Company before Claims Tribunal. 12. Therefore, in light of aforesaid facts, the question is that under Section 147 of MV Act, a statutory liability is accepted by Insurance Company if any vehicle is insured by Insurance Company for third party risks. Section 147(1)(b)(i) and Section 147(1)(b)(ii) of MV Act reads as under : “147(1)(b)(i) provided that; a policy shall not be required 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 injury sustained by such an FA/492120/2008 9/18 JUDGMENT employee arising out of and in the course of his 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 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 147(1)(b)(ii) - to cover any contractual liability.” 13. Section 147(1)(b)(i)(c) covers; if it is a goods carriage, being carried in the vehicle, meaning thereby that, if any person as a labourer carried in goods vehicle by the insured, then, his liability has been covered under insurance policy. Under MV Act, two types of liabilities are accepted by Insurance Company; one is statutory and another is contractual. In respect to two labourers, Rs.30/- additional premium was paid. This is being a contractual liability and this is being to those rest of the labourers who are covered by obtaining the insurance itself, then, such liability is statutory liability under Section 147 of MV Act. 14. This very aspect has been examined by Bombay High Court in case of Shivraj Vasant Bhagwat v. FA/492120/2008 10/18 JUDGMENT Shevanta Dattaram Indulkar and another reported in 1997 ACJ 1014, where, the goods vehicle policy; breach of; liability of Insurance Company; claim for injuries sustained by labourer travelling in the truck; truck was carrying more than 11 labourers at the time of accident which was in violation of the policy which restricts the number of persons to be carried to six persons; Tribunal exempted the Insurance Company; whether the breach of condition is such by which the contract of insurance is vitiated so as to absolve the insurance company from its liability; the answer is given 'No'; the term violated is not so fundamental as to offer ground to the insurance company to exonerate itself. The Division Bench of Bombay High Court has considered that “it is plain from the terms of the Insurance Policy that insured vehicle was entitled to carry six workmen excluding driver.” This is the basic policy is to be issued by Insurance Company when the truck as a goods vehicle insured by owner. This aspect has not been properly highlighted by advocate of other side before Claims Tribunal, even though, Claims Tribunal has considered that liability of six labourers for getting insurance which is covered, for that, additional premium is not necessary and these persons were travelling as a labourers proved on the basis of evidence led before Claims Tribunal, no rebuttal evidence was led before Claims Tribunal by Insurance Company. Therefore, according to my opinion, Claims Tribunal has rightly examined the matter and for that, Tribunal has not committed any FA/492120/2008 11/18 JUDGMENT error. 15. Recently, this very question has been examined by Full Bench of Madhya Pradesh High Court in case of Bhav Singh v. Savirani and others reported in 2008 ACJ 1043. The Full Bench of Madhya Pradesh High Court has considered that passenger risk in goods vehicle, liability of Insurance Company in case of death of labourer working for the owner of tractor-trolley and travelling in the vehicle when it met with accident; whether employee of owner of vehicle is a third party as he is a party other than the contracting party to the insurance policy; the answer is 'yes' and whether insurance company is liable for death or bodily injury to an employee of owner of vehicle who falls in categories (a), (b) and (c) of Clause (i) of proviso to Section 147(1), the answer is given 'yes'. Therefore, this is being a recent decision and very question has been examined by Full Bench, the contention raised by learned advocate Ms. Jani, therefore, cannot be accepted. 16. This question has been also examined by Rajasthan High Court in case of New India Assurance Co. Ltd. v. Sita and others reported in 2006 ACJ 2212. Here also, the Insurance Company disputed his liability on the ground that it cannot be believed that as many an 23 persons can be labourers in truck, they were either gratuitous passengers or they were travelling unauthorisedly and risk of only 4+2 persons was covered under the policy. The evidence is FA/492120/2008 12/18 JUDGMENT that all the persons travelling in the vehicle were labourers and they were required for loading/unloading fodder; extra premium had been paid and risk of persons, without any limit, engaged for loading/unloading goods was covered in the policy; whether the insurance company is liable, the answer is given 'yes'; moreover, no case that more number of persons in the vehicle contributed to causing of accident. Here also, the Rajasthan High Court has examined the question of liability of Insurance Company under Section 147 when labourers are travelling along with goods in the truck. [See : (1) United India Insurance Co. v. Mattedu Manikyam – 2000 (2) ACC 601 ; 2000 AIHC 758; (2000)1 ALD 572; (2000)3 Andh LT 273. (2) National Insurance Co. v. Pyarelal – 2001 ACJ 680 (HP) (DB). (3) New India Assurance Co. v. Kistamma – 2001 ACJ 516; 2000 AIHC 153 (AP). (4) Vardhaneedi Pandu Venkatachala Prabhakar v. Bunga Santhi Kumari – (2000) 1 Andh WR 390; 2000 AIHC 967 (AP) (5) United India Insurance Co. v. Shobhnaben Girishbhai Patel – AIR 1999 Guj 216; (1999-2) Guj LR 113 (DB). FA/492120/2008 13/18 JUDGMENT (6) Oriental Insurance Co. v. Bhuma Bi – 1995 ACJ 627; 1994 (2) ACC 715 (Bom) (DB). (7) K. Easwaramma v. Shaik Khader Mahiddin – 1991 (!) ACC 184 (AP). (8) National Insurance Co. Ltd. v. Sheeta Sharma – 1995 ACJ 929; 1995(1) ACC 501; 1995(2) AJR 81 (AP). (9) Somti Bai v. Misri Lal Choudhury – 1995 ACJ 1233; 1996(1) AJR 367 (MP) (DB). (10) National Insurance Co. Ltd. v. Balawwa – 1993 ACJ 815; 1993(2) TAC 357; 1993(2) ACC 463 (Kant). (11) New India Assurance Co. Ltd. v. V. Salamma – 1990 ACJ 988; 1990(1) TAC 689 (AP). (12) United India Insurance Co. Ltd. v. Thimmawwa – 1989 ACJ 149; 1989(1) ACC 51; 1989(1) ACC 208 (Kant)(DB). (13) S.D. Sharma v. Ramesh Mukun – 1993 ACJ 385; 1992(2) TAC 324; 1994(2) ACC 139; 1993(1) AJR 620 (Ori). (14) M.K. Palasingiri v. Palaniammal – AIR 1991 Mad 314; 1992 ACJ 137; 1992(1) TAC 280; FA/492120/2008 14/18 JUDGMENT 1991(2) ACC 611. (15) Baldev Singh v. Vidya Devi – 1993 ACJ 938 (P&H). (16) Purushottam v. Dev Chand – 1997 ACJ 167 (Raj.) (17) New India Assurance Co. Ltd. v. Shukri alias Lungi – 1991 ACJ 897; 1992(1) AJR 684; 1991(2) TAC 637; 1991(2) ACC 251 (HP). (18) New India Assurance Co. Ltd. v. Smt. Shakuntala Devi – 1997 (2) TAC 45 (J&K) (DB). (19) National Insurance Co. v. Kans Ram – 2002 ACJ 1177 (MP) (DB) case followed B.V. Nagaraju v. Oriental Insurance Co. - 1996 ACJ 1178 (SC). (20) B.V. Nagaraju v. Oriental Insurance Co. Ltd. - AIR 1996 SC 2054; (1996)4 SC 647; 1996 ACJ 1178; 1996(2) TAC 429; 1996(3) Civ LJ 147; 1997(1) AJR 320; 1997(1) ACC 123. (21) United India Insurance Co. v. Guguloth Khana – 2001(2) ACC 392; 2002 ACJ 1294. (22) United India Insurance Co. v. A. Govindan – 2000(3) ACC 363; (2000)1 MLJ 721; 2002 ACJ 539. FA/492120/2008 15/18 JUDGMENT (23) United India Insurance Co. v. Gouri Rajubai – 2001 ACJ 281; 2000 AIHC 2000; 1999(2) ACC 702 (AP). (24) Oriental Insurance Co. Ltd. v. Smt. Irawwa – AIR 1992 Kant 321; 1992 ACJ 918; 1992(2) TAC 615; 1992(2) ACC 197; (1992)3 Kant LJ 62; ILR (1992) Kant 1592; 1992(2) AJR 7 (DB). 17. The another angle of looking to this matter that by amendment of 1994 - Section 147, a definition of injury to any person is extended to include owner of the goods or his authorised representative carried in vehicle. At the time of accident, the coal being a goods was loaded in the truck. The owner of the truck or owner of the goods either it may be a different or it may be the same person, because, a truck belongs to the owner, the coal as goods may be belong to owner, then, these labourers who were travelling in truck as an authorised representative of owner of goods. The reason is that truck was loaded with coal except labourers there were no other persons travelling in truck. Therefore, these persons were travelling along with goods, but, they were not owner of goods, but, they can consider to be his authorised representative which has been carried in the vehicle along with goods. So, according to my opinion, even labourers those who are travelling along with goods may be considered as his authorised representative of FA/492120/2008 16/18 JUDGMENT owner of goods travelling in truck being a third party and on that ground, Insurance Company is liable to pay compensation being a statutory liability to third party those who were labourers travelling in truck along with goods being his authorised representative of owner carried in vehicle. So, on that ground also, Insurance Company cannot deny the liability of labourers those who are travelling in truck at the time of accident occurred. 18. In the facts of this case, the persons those who were travelling upon the goods vehicle out of that according to Insurance Company, additional premium paid for two labourers. But, it is not the case of Insurance Company that rest of the persons are passengers travelling by paying a fare to driver. Therefore, rest of the persons were not travelling by paying fare in goods vehicle. No evidence was led by Insurance Company to prove this fact that they were travelling by paying fare in goods vehicle. Except premium for two labourers, no other defence raised before Claims Tribunal by Insurance Company. Therefore, presumption is that rest of the persons are travelling as his authorised persons of owner. In goods vehicle, coal was loaded being an undisputed facts. This coal being the goods is belong to his owner. The owner was not travelling with goods, but, in place of owner, his authorised representative carried in goods vehicle to take care of goods which was loaded in goods vehicle. Therefore, two types of persons are included in Section 147 of MV Act by way FA/492120/2008 17/18 JUDGMENT of amendment dated 14th November 1994. One is onwer of the goods and another is his authorised representative carried in vehicle. Rest of the persons were labourers travelling as an authorised representative of owner of goods in the goods vehicle, therefore, they are considered to be a third party within the meaning of Section 147 of MV Act having a statutory cover and protection under Section 147 of MV Act and accordingly, Insurance Company is statutorily liable for rest of the persons, those who have been expired, for paying compensation to the claimants. Without evidence on record, it cannot presume that these persons were travelling as an unauthorised or gratuitous passengers. The driver was not examined even owner of vehicle was also not examined. Therefore, contention raised by learned advocate Ms. Megha Jani cannot be accepted. Claims Tribunal has rightly examined the matter and rightly held liable the Insurance Company, for that, no error has been committed by Claims Tribunal. 19. Therefore, there is no substance in the present appeals. Accordingly, present appeals are dismissed. 20. It is made clear that except the aforesaid contention, appellant – Insurance Company has not made any other submissions before this Court which has been dealt with by this Court accordingly. 21. In view of above order passed by this Court FA/492120/2008 18/18 JUDGMENT today, no order is required to be passed in Civil Applications. Accordingly, Civil Applications are also disposed of. 22. The amount, if any, deposited by appellant before this Court, be transmitted to Claims Tribunal immediately. Sd/- [H.K. RATHOD, J.] #Dave