The Oriental Fire and General Insurance Co. Ltd. vs Dr. Sitaram and Others

S.K. Seth, J.

The Motor Accidents Claims Tribunal, Khandwa vide its award dated 30.1.1979 passed in Claim Case No. 2 of 1978 ordered the three opposite parties namely the owner of the truck, its driver and the insurer i.e. the Oriental Fire and General Insurance Company Ltd., to pay to the claimant i.e Dr. Sitaram Rs. 4,800/- with interest as compensation for the damage to the motor-cycle of the claimant caused in a motor accident involving the said truck. Being aggrieved by the said award, one of the opposite parties namely the insurer has filed the present appeal in this Court.

The sole contention of the insurer in the present appeal is that Section 96(2) read with Section 95(2)(d) of the Motor Vehicles Act, 1939 restricted the statutory liability of an insurer in respect of damage to any property of a third party to a limit of Rs. 2,000/- and as such in the present case the Tribunal acted illegally in making the insurer liable to pay the compensation of Rs. 4,800/- jointly and severally along with the other opposite parties. In the opinion of this Court, the contention is misconceived and deserves to be rejected.

As observed by the Supreme Court in Pushpabai Purshottam Udeshi and Others Vs. Ranjit Ginning and Pressing Co. (P) Ltd. and Another, the insurer is always at liberty to take policies covering risks which are not covered by compulsory insurance u/s 96(2) read with Section 95(2)(d) of the Motor Vehicles Act. The liability u/s 95(2)(d) is the minimum liability, but there is nothing in the act which prohibited the insurance company from expanding limits of its liability by a contract of insurance. Section 96(2) read with Section 95(2)(d) only prescribes statutory compulsion, it does not follow from it that it is not open to an insurer to cover the third party property risk in excess of Rs. 2,000/-. There is no bar or embargo, for covering the higher risk under the policy of insurance. [See also: Bomanji Rustomji Ginwala Vs. Ibrahim Vali Master and Others, ; Hans Raj and Another Vs. Sukhdev Singh and Another, ; Srisailam Devastanam Vs. Bhavani Pramilamma and Others, and Sharda Prasad Singh Vs. Maharashtra State Road Transport Corporation and Others,

In the case in hand, the contract of insurance between the insurer and the owner of the truck was very clear regarding the liability of the insurer in respect of damage to any property of a third party. Section Il-l(i) of the contract of insurance provided that subject to the ''limits of liability'' the Company would indemnify the insured against all sums including claimant''s costs and expenses which the insured shall become legally liable to pay in respect of damage to property of a third party. In the later part of the document, it was specifically provided under the head ''limits of liability'' that the limit of the amount of the company''s liability u/s ll-l(i) in respect of any one claim or series of claims arising out of one event would be upto to the limit of Rs. 50,000/-. In the circumstances, the insurer could take no objection to it being held liable to pay Rs. 4,800/- with interest as compensation for the damage to the motor-cycle of the claimant along with other opposite parties.

There is no merit in the appeal and the same is accordingly dismissed with costs. Counsel''s fee Rs. 100/-, if certified.