THE HON’BLE SRI JUSTICE R. SUBHASH REDDY Writ Petition No.21401 of 2006 ORDER: 1 In this Writ Petition the petitioner has questioned the proceedings of the Regional Manager, A.P.S.R.T.C, Tirupathi i.e. the 2nd respondent dated 01.04.2005 issued in proceedings No.T1/785 (59) / 2004-RM (T). By the aforesaid order the petitioner is requested to arrange to deposit a sum of Rs.39,000/- which was awarded as compensation by the Motor Accidents Claims Tribunal – cum – V Additional District Judge, Tirupati (for short ‘the Tribunal’) in MVOP No.403 of 2000. 2 The petitioner is the owner of the stage carriage vehicle bearing No.AP 03 U 4177. The said vehicle was hired to the Andhra Pradesh State Road Transport Corporation (for short ‘the Corporation’) and an agreement was also entered into. When the petitioner was plying the bus on the route from Chandragiri – Rayalapuram road on 19.04.2000, it met with an accident, in which one Mr.S. Ramaswamy Nadar sustained injuries. In that connection the said Ramaswamy Nadar filed MVOP No.403 of 2000 under Section 166 (1) (a) of the Motor Vehicles Act, 1988 before the Tribunal claiming compensation of Rs.1,50,000/- alleging that there was negligence on the part of the respondents and the petitioner herein in handling the vehicle. In the aforesaid claim application before the Tribunal the petitioner herein is the first respondent, the insurer of the offending vehicle is the second respondent and the Corporation represented by its Managing Director is the third respondent. The Tribunal by its judgment and decree dated 31.01.2005, while allowing the said claim application partly, awarded a sum of Rs.39,000/- together with interest at the rate of 9% p.a. as compensation only against the insurance company and the Corporation. 3 In view of the award of the Tribunal, the second respondent issued the impugned proceedings referring to the award of the Tribunal passed in MVOP No.403 of 2000. The basis for the second respondent to pass the impugned proceedings is that as per the terms of the agreement entered into between the petitioner and the Corporation, while hiring the bus, it is agreed that the petitioner is liable to pay compensation in the event of any award being passed by the Tribunals. 4 In this Writ Petition it is the case of the petitioner that the vehicle was totally under the control of the Corporation and for all practical purposes, the Corporation is treated as owner of the bus for awarding compensation. It is his further case that when the Tribunal granted decree only against the insurer of the vehicle and the Corporation, there is no reason for the second respondent to issue the impugned proceedings against the petitioner for arranging payment of Rs.39,000/-. On the other hand, it is the case of the respondents that in view of the agreement entered into by the petitioner with the Corporation, where there is a clear agreed term that the petitioner is liable to pay the compensation in the event of any award by the Tribunals, the petitioner has to pay the compensation. 5 Heard the learned counsel for the petitioner and also the learned standing counsel for the Corporation. When the matter is taken up, the learned counsel for the petitioner placed reliance on the judgment of the apex Court in Uttar Pradesh State Road Transport Corporation Vs. Kulsum and others[1]. In the said case, almost on similar set of facts when the insurance company was not made liable, when the vehicle was insured, the apex Court held that the insurance company cannot escape the liability to pay the amount of compensation. In the aforesaid judgment it is also held that when the vehicle is in possession of the Corporation and when it is running on hire basis, for all practical purposes, the Corporation will be construed as the owner of the said bus for the specified period of contract. 6 In this case, it is to be noticed that when the third party filed a claim petition and when the Corporation was impleaded as a party respondent to the said proceedings, and when such an agreement is there with a recital to the effect that the petitioner has to bear the liability in the event of any award by the Tribunals, it is open to the Corporation to take such plea before the Tribunal. But, in this case, is it not in dispute that the award of the Tribunal is against the insurance company and the Corporation only. Though the petitioner was arrayed as respondent No.1 to the aforesaid MVOP, there is no decree against him. In spite of specific recitals in the agreement, when there is a decree awarded against the Corporation and the insurance company only, it is open to the Corporation to question the liability by way of filing an appeal, but the Corporation cannot recover the amount from the petitioner under the guise of the agreed terms in the agreement. It is also to be noticed that Kulsum case (1 supra) also supports the case of the petitioner. In this case also it is not in dispute that by virtue of possession of the vehicle by the respondents during the relevant period of time, in view of the agreement entered into between the Corporation and the petitioner, for all practical purposes, the Corporation itself has to be treated as the owner of the bus. When the accident had occurred during the specified period of contract, and when there is a decree awarded by the Tribunal only against the Corporation and the insurance company, the respondents cannot recover the amount from the petitioner by issuing the impugned proceedings. 7 For the aforesaid reasons, the impugned proceedings No.T1/785 (59)/2004-RM (T) dated 01.04.2005 issued by the 2nd respondent are hereby set aside. However, it is made clear that if the Corporation claims that it is not liable to pay the compensation, it is open to the Corporation to take steps to assail the award of the Tribunal by taking appropriate steps in accordance with the provisions of the Motor Vehicles Act, 1988. 8 Subject to the above directions, this Writ Petition is allowed. No costs. --------------------------- R.Subhash Reddy, J. 10.11.2011 Kvsn [1] 2011 (7) SCJ 40