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Judgment
The appellant who was respondent 2 in M. V. C. No. 181 of 1971 on the file of the Motor Accidents Claims Tribunal and the First Additional District Judge, Bangalore, has, in this appeal, challenged the award passed by the Tribunal saddling it with the liability of the insurer, who was respondent 4 in the said claims case to Rs. 2,000/-only as provided u/s 95 (2) (d) of the Motor Vehicles Act (to be hereinafter referred to as the ''Act'').
A jeep belonging to the appellant crashed into the shop of the claimant and caused damage to the property of the claimant. The Tribunal assessed this damage at Rs. 10,500/- and passed an award limiting the liability of the insurer to a sum of Rupees 2,000/- only in view of Section 95 (2) (d) of the Act
The only point urged before us is that the Tribunal was wrong in limiting the liability of the insurer to a sura of Rs. 2,000/-only and it ought to have held that the insurer was liable to pay the whole amount of the damages to the claimant jointly and severally with the owner viz. the appellant Sri G. V. Shantaraju, the learned Advocate appearing on behalf of the appellant, urged that in view of Section 95 (5) of the Act, the insurer was at liberty to enter into terms of contract which are different from the terms found in Section 95 (2) of the Act with the insurer so long as the minimum requirements laid down in Section 95 (2) of the Act were complied with. We find that there cannot be any controversy in this proposition of law put forward by Sri G. V. Shantaraju. His further argument is that by Ex. R.1 the insurance policy in question, it was stipulated between the insured and the insurer that the insurer should indemnify the insured to the full amount (in regard to damages to property belonging to third party) to which he would be liable by a Court or a Tribunal. He placed reliance on the relevant provision in Ex. R.1. The relevant provision in Ex. R.1 reads as follows:
"The Society will indemnify the insured in the event of accident caused by or arising out of the use of the Motor Car against all sums including claimant''s costs and expenses which the insured shall become legally liable to pay in respect of--
(b) damage to property other than property belonging to the insured or held in trust by or in the custody or control of the insured." (Note underlining (italics) is ours). Sri G. V. Shantaraju wanted us to read the words ''legally liable'' to mean found liable or held liable by a Court or a Tribunal. We are unable to agree with this contention in view of the provisions of Sections 94 and 95 of the Act. The policy in question was issued on 6-5-1970. The amended provision of Section 95 of the Act came into force on 2-3-1970. Section 94 of the Act makes it compulsory that insurance against third party risks should be taken out by owners of vehicles. It is, therefore, evident that this policy Ex. R.1 has been taken out in view of the provisions of Sections 94 and 95 of the Act. This background cannot be forgotten while understanding the terms of the policy. In his view of the mailer, the words ''legally liable'' found in the above term of the policy would have only one meaning and that is Liable According to Law. The law in regard to liability of an insurer is laid down specifically in Section 95 (2) of the Act. In regard to damages to the property belonging to a third party, the relevant provision is found in Section 95 (2) (d) of the Act. That provision limits the liability of an insurer to a sum of Rs. 2,000/- only. In case the insured and the insurer had agreed between themselves that there should be a term which is different from what is found in Section 95 (2) (d) of the Act, it ought to have been, in our opinion, explicitly mentioned in that manner, as a specific term in the policy. No such term is found in the policy Ex. R.1. Therefore, we have no hesitation in rejecting this contention of Sri G. V. Shantaraju.
In view of the foregoing reasons, we find no substance in this appeal and, hence dismiss the same. No order as to costs under the circumstances of the case.