NEW INDIA ASSURANCE CO. LTD. versus VEDWATI AND ORS.

Leave granted.

p. 919, margin F

Challenge in these appeals is to the judgment rendered by a Bench of the Allahabad High Court dismissing the appeal filed by the appellant (hereinafter referred to as the 'Insurer'). By the impugned judgment I. A Court held that the respondent Nos. I to 6 (hereinafter referred to as the 'Claimants') were entitled to compensation and that the same was to be paid "i by the insurer;

pp. 919–920, margin F

Background facts in a nutshell are as follows: B A Claim.Petition was filed under Section 166 of the Motor Vehicles Act, 1988 (in short the 'Act') claiming compensation with the allegation that Paras Ram Agnihotri (hereinafter referred to as the 'deceased') was returning from his village Gokhia from Atarra in tractor No.MP 16A/2637 after delivering certain goods there. The tractor overturned due to rash and negligent driving by the driver, with the result the deceased has lost his life. He was aged about 38 years and was working as priest and agricultural farmer from which he was earning about Rs.7,000/- per month. Adjudicating the Claim Petition, the IVth Additional D~strict Judge Banda-cum-Mot9r Accidents Claims Tribunal (in short the 'MACT') did not accept the plea of the insurer that there was violation of terms of the policy issued to Jagdish Prasad (hereinafter referred to as the 'insured'). The tractor could only be used for agricultural work. Since the same was used for carrying passenger, the insurer was not responsible to indemnify to any award and to pay any amount to the claimants. The Tribunal rejected this plea and held that in view of this Court's judgment in New India Assurance Company v. Satpal Singh & Ors. [2000) I SCC 237, passenger travelling in a goods vehicle graciously was also entitled to claim compensation which was to be paid by the insurer. The High Court affirmed the view by the impugned order.

p. 920

In support of the appeals, learned counsel for the appellant submitted that the view in Satpal Singh 's case (supra) has subsequently been overruled by this Court and therefore the view of the High Court is unsustainable.

p. 920, margin E

In response, learned counsel for the claimants submitted that in any event the liability of the insurer vis-a-vis the third party will not be altered.

p. 920, margin F

This Court had occasion to deal with cases of passengers traveling in goods vehicles which met accident resulting in death of such person or bodily injury. Such cases belong to three categories i.e. (1) those covered by the old Act, (2) those covered by the Act; and (3) those covered by amendment of the Act in 1994 by the Motor Vehicles (Amendment) Act. 1994 (hereinafter referred to as the 'Amendment Act').

p. 920, margin F

The present appeals belong to the second category.

p. 920, margin H

In Satpal Singh 's case (supra) that provisions of Section 95(1) of the Section 147(1) of the Act as it stood

p. 921, margin A

On a closer reading of the service vehicle", "state carrier" and "transport vehicle" 2(8), 2(25), 2(29) and 2(33) of the old i.e. Section 2(14), 2(35) 2(40) and 2(47) of conceptual differences. The provisions Old Act: "2 (8) "goods vehicle" means any for use for the carriage of constructed or adapted whelil used in addition to passengers" "2(25) "public service vehicle" adapted to be used for the carriage of and includes a motor cab contract carriage, "2(29) "stage carriage" means carry more than six persons excluding passengers for hire or reward at passengers either for the whole "2(33) "transport vehicle" means vehicle:" The Act (New Act): "2(14) "goods carriage" any motor use solely for the carriage of constructed or adapted when "2(35) "public service vehicles" adapted to be used for the carriage and includes a maxicab a motorcab, contract "2(40) "stage carriage" means to carry more than six passengers reward at separate fares paid by the whole journey or for stages A "2( 47) "transport vehicle" means a pubic services vehicle a goods carriage an educational institution bus or a private service vehicle:" (Underlined for emphasis)

pp. 921–922, margin A

"Liability" as defined in Section 145(c) of the Act reads as follows: B ' "Liability", wherever used in relation to the death of or bodily injury to any person, includes liability in respect thereof under Section 140."

p. 922

Third party risks in the background of vehicles which are subjectmatter of insurance are dealt with in Chapter VlII of the old Act and Chapter C XI of the Act. Proviso to Section 147 of the Act (sic) is to be (sic) with Section 96 of the' old Act. Proviso to Section 14 7 of the Act reads as follows: 'Provided that a policy shall not be required (i) 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 injure sustained by such an employee arising out of and in the course of his ~mployment other than a liability arising under the Workmen's Compensation Act. 1993 (8 of 1923) in respect of the death of or bodily injury to, any such employee- ( a) engaged in driving the vehicle, or (b) ifit is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicles, or ( c) if it is a good carriage, being carried in the vehicle, or (ii) to cover any contractual liability." ' +

p. 922

It is of significance that proviso appended to Section 95 of the old Act contained Clause (ii) which does not find place in the Act. The same reads as follows:- "except where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment to cover liability in respect of the death of or bodily injury to persons being carried in or upon or entering or mounting or alighting from the vehicle at the time of the occurrence of the event out of which a claim arises." NEW INDIA ASSljRANCE CO. LTD. VEDWATI [PASAYAT,

pp. 922–923

The difference in the language of "goods vehicle" old Act and "goods carriage" in the Act is of significance. of the provisions makes it clear that the legislative intent goods vehicle from carrying any passenger. This is clear from "in addition to passeng:ers" as contained in definition of the old Act. The position becomes further clear because the is "good carriage" is solely for the carriage of goods. Carrying in a goods carriage is not contemplated in the Act. There similar to Clause (ii) of the proviso appended to Section prescribing requirement of insurance policy. Even Section mandates compulsory coverage against death of or bodily passenger of "public service vehicle". The proviso makes it compulsory coverage in respect of drivers and conductors vehicle and employees carried in goods vehicle would be under the Workmen's Compensation Act, 1923 (in short 'WC Act"). no reference to any passenger in "goods carriage".

p. 923, margin A

The inevitable conclusion, therefore, is that provisions of do not enjoin any statutory liability on the owner of a vehicle vehicle insured for any passenger travelling in a goods carriage insurer would have no liability therefor.

p. 923, margin C

Our view gets support from a recent decision of a of this Court in New India Assurance Company Limited Ors., (2002) 8 Supreme 594, in which it has been held that Satpal Singh (supra) was not correctly decided. That being the position, the High Court were not justified in holding that the insurer to satisfy the award.

p. 923, margin D

This position was also highlighted in Oriental Insurance v. Devireddy Konda Reddy and Ors., [2003) 2 SCC 339. Subsequently National Insurance Co. Ltd. v. Ajit Kumar and Ors., [2003) National Insurance Co. Ltd. v. Baljit Kaur and Ors., [2004) National Insurance Co. ltd. v. Bommithi Subbhayamma and SCC 243, the view in Asha Rani's case (supra) was reiterated .

p. 923, margin E

Above being the position, the impugned order of not sustainable and we accordingly set aside the same.

p. 923, margin G

Appeals are allowed with no order as to costs. RP.

p. 923, margin G