: 1 : SD IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION CIVIL APPELLATE JURISDICTION CIVIL APPELLATE JURISDICTION FIRST APPEAL NO.1077 OF 1985 FIRST APPEAL NO.1077 OF 1985 FIRST APPEAL NO.1077 OF 1985 WITH WITH WITH CROSS OBJECTION (ST.) NO.3856 OF 1986 CROSS OBJECTION (ST.) NO.3856 OF 1986 CROSS OBJECTION (ST.) NO.3856 OF 1986 Bapu Nivrutti Devkate ...Appellant V/s. Parvatibai Bibhishan Jadhav & Ors. ...Respondents Mr.A.M. Kulkarni, Advocate, for the Appellant. Mr.S.D. Thokade, Advocate, for Respondent Nos.1 and 2. Mr.S.M. Vidyarthi, Advocate, for Respondent No.4. Mr.P.M. Mengane, Advocate, for Respondent Nos.5 to 7. CORAM : ABHAY S. OKA, J. CORAM : ABHAY S. OKA, J. CORAM : ABHAY S. OKA, J. DATE : 10TH APRIL, 2008. DATE : 10TH APRIL, 2008. DATE : 10TH APRIL, 2008. ORAL JUDGMENT : ORAL JUDGMENT : ORAL JUDGMENT : 1. The submissions of the learned Counsel appearing for the parties were heard on 28th February, 2008. The Appeal was kept for dictation of Judgment on 27th March, 2008. On account of paucity of time, Judgment could not be dictated and, therefore now the Appeal is kept today for dictation of Judgment. 2. The appellant has taken an exception to the Judgment and Award dated 28th February, 1985 passed by the learned Member of the Motor Accident Claims Tribunal at Solapur. It will be necessary to briefly : 2 : refer to the facts of the case. 3. The 1st and 2nd respondents filed an application under Section 110-A of the Motor Vehicles Act, 1939 claiming compensation on account of death of one Bibhishan Sonba Jadhav. The 1st respondent is the widow of the deceased and the 2nd respondent is the daughter of the deceased who was a minor at the time of filing of the claim petition. The deceased was employed as a line-helper with the Maharashtra State Electricity Board and was earning Rs.450/- per month. The accident occurred on 11th April, 1979. On that fateful day, in the afternoon, he was proceeding on his bicycle by Shelgaon-Vairag Road. At that time a truck bearing No.MHF-8707 gave a dash to the deceased. The deceased was knocked down from his bicycle. The claim for compensation was made in the sum of Rs.1,07,060/-. 4. In the claim petition the appellant was impleaded as the purchaser of the said truck. A case was made out by the appellant (opponent No.1 in the claim petition) in his written statement that the driver of the truck was driving the truck by correct side at a moderate speed. It is alleged that the deceased was plying his bicycle on the wrong side of : 3 : the road and the accident occurred due to negligence of the deceased. The driver of the truck namely the 3rd respondent in the Appeal also filed his written statement. It is his case that he was driving the truck in a normal speed and the entire negligence was on the part of the deceased. According to him the deceased and his friend were proceeding towards Vairag by two different bicycles. There was a bullock-cart in front of them. The truck was behind the said deceased and his friend. It is stated that on sighting the bullock-cart he reduced the speed of the truck and sounded horn. At that stage the deceased and his friend overtook the bullock-cart. It is alleged that the deceased after overtaking the bullock-cart instead of taking the bicycle to left side, turned his bicycle towards right. As he was carrying load, he could not balance the bicycle properly. He stated that the deceased was frightened as he lost his balance and the load carried by him fell down on the road. It is alleged that the 3rd respondent took the truck towards his right side and stopped. Thereafter he noticed that the deceased was lying on the tar road with bleeding injury to his head. It is stated that the 3rd respondent took the deceased to the hospital. : 4 : 5. The 4th respondent-insurance company was impleaded as the insurer of the truck. The insurance company filed a written statement contending that the insured transferred the truck to the appellant without any intimation to the said company. It is alleged that there was a breach of conditions of the policy of insurance as the driver was not the employee of the insured and did not possess a driving licence. It was stated that the limit of the liability under the insurance policy was Rs.50,000/-. It was contended that the policy was in the name of one S.M. Kumbhar who was already dead and therefore the said respondent No.4 was not liable. 6. A written statement was filed by the 5th respondent. In the written statement he stated that the truck was owned by his father Shivappa who under a will made a bequest of the said truck to the 5th respondent. The said Shivappa died on 21st February, 1978. Thereafter on 3rd October, 1978, the 5th respondent sold the truck to the appellant. It is stated that the 5th respondent thereafter applied to the Regional Transport Office, Pune for change of name. On 25th October, 1979, an entry of the the truck was made in the name of the 5th respondent. The 5th respondent submitted that on the day of the : 5 : accident, the appellant was the owner of the truck and therefore only the appellant was liable to pay compensation. 7. The learned Member of the Tribunal framed various issues. The first issue was regarding the negligence. The learned Judge held that the accident occurred due to rash and negligent driving on the part of the 3rd respondent. The learned Member of the Tribunal observed that on 3rd October, 1978, the appellant had obtained possession of the truck. It was observed that the appellant also took the custody of the registration book and insurance policy on 3rd October, 1978. He also renewed the insurance policy in the name of Mr.S.M. Kumbhar from 31st October, 1978 till 30th October, 1979 by paying the premium. The learned Member of the Tribunal observed that the next policy from 31st October, 1979 was for a year which was similarly got renewed by the appellant. The learned Member of the Tribunal held that since 3rd October, 1978, the appellant was running the truck as the owner thereof and that was possessing the registration and insurance documents of the truck. The learned Member of the Tribunal observed that not only that the appellant entered into possession but did considerable business of transport with the truck. : 6 : It was held that prior to the date of the accident he had satisfied and fully repaid the bank loan. The learned Member of the Tribunal referred to the decision of this Court in the case of Smt.Gulab Bai V/s. Peter [1975 SCJ 100]. Thereafter the learned Member of the Tribunal proceeded to observe that it was not the case of the 4th opponent i.e. the 5th respondent herein that he had informed the insurer i.e. the 4th respondent herein of the change in ownership. He observed that there was no question of assent on the part of the insurer to the transfer of the vehicle unlike in the Bombay decision. The learned Member of the Tribunal held that the insurer of the vehicle was not liable to pay the compensation. After computing the compensation payable, a sum of Rs.36,000/- with proportionate costs and interest at the rate of 6% p.a. was granted by the Tribunal to the respondent Nos.1 and 2. The compensation was made payable by the appellant and the 3rd respondent herein. 8. The Advocate for the appellant challenged the finding of the Tribunal on the issue of negligence. He submitted that the learned Member has committed an error by holding that the appellant was liable to pay compensation in his capacity as the owner. It was : 7 : submitted that mere possession of the vehicle does not confer any title on the transferee. He submitted that on the date of the accident, the appellant was neither a registered owner nor even an ostensible owner of the motor truck. Therefore, the appellant was not liable to pay the compensation on account of death caused in accident. He submitted that the Tribunal ought to have held that the person who was the registered owner of the vehicle at the time of accident should be taken as the owner of the vehicle. In respect of the transfer, it is submitted that on the date of the accident i.e. on 11th April, 1979, the motor vehicle stood registered in the name of the deceased husband of respondent No.7. The last submission made by the learned Counsel for the appellant is that in any event the insurer of the vehicle ought to have been held liable for payment of compensation. The learned Advocate for the appellant has taken me through the notes of evidence and various decisions of this Court and other High Courts. He also submitted that the compensation granted is on the higher side. 9. The learned Counsel appearing for respondent Nos.1 and 2 supported the finding on the issue of negligence by inviting attention of this Court to the evidence of the witnesses. He submitted that the : 8 : compensation awarded is on the lower side. He submitted that compensation of Rs.1,00,000/- ought to have been granted. He submitted that interest ought to have been awarded at the rate of 12% p.a. He submitted that the Cross-Objection deserves to be allowed. 10. Reliance is placed by the Counsel appearing for the insurer of the truck on certain decisions. He submitted that the insured had never informed the insurer of the transfer of the truck and therefore, the insurer was not liable. He submitted that the policy of insurance was in the name of the dead person (S.M. Kumbhar) and therefore, it was null and void. He submitted that no interference was called for. 11. Broadly, three questions arise in the Appeal; (i) whether the appellant was the owner of the truck on the date of the accident? (ii) whether the insurer (the 4th respondent) was liable to pay compensation? (iii) whether the finding of the Tribunal on the issue of negligence is correct? (iv) whether the quantum of compensation awarded is just and reasonable? 12. Before adverting to the submissions made by the learned Counsel appearing for the parties it will : 9 : be necessary to refer to the evidence adduced by the parties. Firstly a reference will have to be made to the evidence of the appellant. He stated that the accident took place on 11th April, 1979 in which the truck was involved. According to him the original opponent No.4 (respondent No.5) was the owner at the time of the accident. The case made out by the appellant is that he purchased the truck on 8th February, 1980 and that he insured the truck on the same day. He stated that the employer of the deceased had deposited a sum of Rs.10,000/- in the Civil Court for making payment to the 1st respondent (1st claimant). He was cross examined by the Advocates appearing for the parties. In the cross-examination he stated that the talks regarding purchase of the vehicle in question took place in October, 1978. He stated that he agreed to purchase the truck for Rs.57,000/-. He stated that he paid a sum of Rs.37,000/- to the 5th respondent on that day. He stated that the truck was hypothecated in favour of the Bank of India for the sum of Rs.20,000/-. He admitted that prior to the date of the accident, he had paid the entire amount payable to the bank. He stated that on 25th October, 1979, the registration of the vehicle was changed in the name of respondent No.5. He stated that on 8th February, 1980 he himself : 10 : applied to the R.T.O., Solapur and got the vehicle registered in the name of his son Dayashankar. He stated that from 3rd October, 1979 he was running the truck as owner thereof. 13. He was cross-examined by the Advocate for the 1st and 2nd respondents. He stated that on 3rd October, 1978 when he took possession of the truck, he also obtained the registration book and insurance policy. On 31st October, 1978, the insurance policy was renewed. The other evidence is of the driver of the truck. It will be necessary to refer to the evidence of the driver of the truck at a later stage. 14. It will be necessary to refer to certain documents produced on record. At Exhibit-98 there is a true copy of the policy produced by the 4th respondent-insurance company which was valid from 31st October, 1978 to 30th October, 1979. In the said policy the name of the insured is mentioned as S.M. Kumbhar (Shivappa M. Kumbhar). Thus the insured shown in the policy of the insurance is the said S.M. Kumbhar who was admittedly not alive on the day on which the policy was issued. Therefore a submission has been made by the learned Counsel appearing for the insurance company that the policy stood in the name of : 11 : a dead person and therefore the said policy was not valid. 15. It will be necessary to refer to the deposition of the appellant (the opponent No.1). Though in examination-in-chief he came out with the case that he purchased the truck involved in the accident on 8th February, 1980, in the cross-examination he has disclosed following facts:- (a). The negotiations for purchase of the truck took place between the appellant and the original opponent No.4 i.e. respondent No.5 herein on 3rd October, 1978. (b). He agreed to purchase the truck for the price of Rs.57,000/- and on 3rd October, 1978, the truck was placed in his possession against payment of sum of Rs.37,000/- made by him to the 5th respondent. (c). The truck at the relevant time was hypothecated in favour of Bank of India and the amount payable to Bank of India was Rs.20,000/-. It was agreed that the appellant will pay instalment of Rs.2,000/- per month to : 12 : the said Bank. (d). 4 days prior to the date of accident, the appellant paid the last instalment to the Bank and cleared all its dues. (e). On 25th October, 1979, the truck which was earlier standing in the name of Shivappa, the father of the 5th respondent, was transferred in the name of the 5th respondent. (f). On 8th February, 1980, an application was made to the R.T.O., Solapur and the truck was transferred in the name of son of the appellant. 16. In the cross-examination the appellant categorically admitted that since 3rd October, 1978, he was running the truck as the owner thereof. In response to questions asked by the Advocate for the original claimants, the appellant reiterated that on 3rd October, 1978 when he took possession of the truck, he also took custody of the registration book and the insurance policy. He stated that on 31st October, 1978 the policy was renewed. He stated that he paid the amount of premium to the 5th respondent : 13 : who in turn got the policy renewed in the name of his father. He stated that the policy was renewed from 31st October, 1979 in similar manner. The cover note as well as policy were handed over to the appellant by the 5th respondent. Thus he admitted that on 31st October, 1978 and 31st October, 1979 he paid the premium payable under the insurance policy. The deposition of the original opponent No.2-driver i.e. the 3rd respondent herein discloses that he was in the employment of the appellant on the date of the accident as a driver of the said truck. 17. The learned Counsel appearing for the appellant relied upon a decision of the learned Single Judge of this Court in the case of Jaysingrao Dadu Patil and Anr. V/s. Kutubuddin Ismail Soudagar & Ors. [1997 (1) Mh.L.J. 737]. He placed reliance on what has been held by the learned Single Judge in paragraph No.11 of the said decision. Paragraph No.11 of the said decision reads thus:- "11. The agreement entered into between the present appellants and respondent No.3 on 17-4-1980 leaves no manner of doubt that the sale of the tractor in question was conditional on payment of instalments of Rs.2,000/- per month by the present appellants to the State Bank of India. There is no dispute that said payment of : 14 : Rs.2,000/- per month till discharge of entire loan together with interest was not made by the present appellants. When the sale of the tractor in question was conditional sale depending upon due discharge of obligation under the terms of the agreement, the property in the said tractor cannot be said to have passed on to the present appellants at the time when the agreement was made on 17-4-1980. Section 20 of the Sale of Goods Act provides that where there is unconditional contract for the sale of specific goods, the property in the goods passes to the buyer when the contract is made and it is immaterial whether at that time payment of the price of delivery of goods, or both, is postponed. However, section 20 of the Sale of Goods Act cannot be invoked nor can it be attracted when the agreement for sale is conditional. In other words section 20 has application only where the contract for the sale of goods is unconditional." 18. Before discussing the said decision of the learned Single Judge, at this stage, it will be necessary to refer to a decision of the Apex Court in the case of Vasantha Viswanathan & Ors. V/s. V.K. Elayalwar & Ors. [(2001) 8 SCC 133]. In the said decision the Apex Court dealt with the issue of transfer of ownership of motor vehicle. The Apex Court held that section 31 of the Motor Vehicles Act, 1939 does not effect a transfer but the same only prescribes a procedure for entering the factum of transfer in the registration certificate which is an : 15 : act posterior to the actual transfer. The Apex Court held that the transfer of the motor vehicle would be governed by provisions of section 19 of the Sale of Goods Act, 1930. In paragraph No.10 of the decision, the Apex Court held thus:- "10. Section 31 of the Motor Vehicles Act, 1939 lays down that where the ownership of any motor vehicle registered under the Motor Vehicles Act is transferred, the transferor and transferee both are required to report the fact of transfer to the registering authority so that particulars of transfer of ownership may be entered in the certificate of registration. The transfer is not The transfer is not The transfer is not effected under Section 31 of the Motor effected under Section 31 of the Motor effected under Section 31 of the Motor Vehicles Act, 1939, but the same Vehicles Act, 1939, but the same Vehicles Act, 1939, but the same simply prescribes procedure for simply prescribes procedure for simply prescribes procedure for entering the factum of transfer in the entering the factum of transfer in the entering the factum of transfer in the registration certificate, which is an registration certificate, which is an registration certificate, which is an act posterior to the transfer. The act posterior to the transfer. The act posterior to the transfer. The transfer of vehicles in question would transfer of vehicles in question would transfer of vehicles in question would be governed by the provisions of be governed by the provisions of be governed by the provisions of Section 19 of the Sale of Goods Act Section 19 of the Sale of Goods Act Section 19 of the Sale of Goods Act according to which property in the according to which property in the according to which property in the vehicle would pass to Defendant 1 at vehicle would pass to Defendant 1 at vehicle would pass to Defendant 1 at such time as the parties to the such time as the parties to the such time as the parties to the contract intend it to be transferred. contract intend it to be transferred. contract intend it to be transferred. Thus the passing of property in the Thus the passing of property in the Thus the passing of property in the goods would be dependent upon the goods would be dependent upon the goods would be dependent upon the intention of the parties, as evidenced intention of the parties, as evidenced intention of the parties, as evidenced from the contract. from the contract. from the contract. From the contract, Exhibits A-1 and A-2, it would appear that the parties intended that after the registration formalities were completed, price of the vehicles covered by the permits would be ascertained and thereafter the same would be paid by the Defendant 1, entitling him to take possession of the vehicles. Thus the parties intended that property in the vehicles shall pass only after possession of : 16 : the vehicles was delivered to the Defendant 1 after completion of all the aforesaid formalities. In the present case, after registration formalities were completed, the value of the vehicles covered by the permits was not ascertained, much less paid, rather, on the other hand, possession was forcibly taken by the Defendant 1. Therefore, property in the vehicles did not pass to the Defendant 1 as required under Section 19 of the Sale of Goods Act. AS the Defendant 1 had illegally taken possession of the vehicles which he was not entitled to ply, it has been rightly held by the High Court that the plaintiff would be entitled to profits earned by the Defendant 1 and Defendants 4 to 7 from plying of the vehicles." (Emphasis added). 19. Thus what has been held by the Apex Court is in a transfer of vehicle is governed by the provisions of section 19 of the said Act of 1930 and accordingly, the property in the vehicle will pass to the transferee at such time as the parties to the contract intended it to be transferred. Thus, passing of the property in the vehicle would depend upon the intention of the parties as evidenced from the contract. 20. The learned Single Judge of this Court in the case of Jaysingrao Dadu Patil (supra) dealt with sections 19 and 20 of the said Act of 1930. Section 20 of the said Act of 1930 provides that where there : 17 : is an unconditional contract for sale of specific goods in a deliverable stage, the property in the goods passes to the buyer when the contract is made and it is immaterial whether at that time payment of the price or the time of delivery of the goods or both is postponed. In the case before the learned Single Judge there was an agreement entered into between the parties on 17th April, 1980 which left no manner of doubt that the sale of the tractor in question was conditional on payment of instalment of Rs.2,000/- per month by the appellants before the learned Single Judge to the State Bank of India. The said amount was payable to the Bank till discharge of the entire loan together with interest. The learned Single Judge, as is apparent from the paragraph No.11 of the said decision, was dealing with the case where the sale of the tractor in question was a conditional sale depending upon the due discharge of obligations under the terms of the agreement. Therefore, the learned Single Judge after considering the facts of the case before him came to the conclusion that the property in the tractor could not have passed on to the transferee on the date of execution of the