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Judgment
B.S. Raikote, J.—This is an appeal preferred by the United India Insurance Company Limited, Adilabad, the first respondent in O.P. No. 127of 1986 on the file of Addl. District Judge, Adilabad (Motor Vehicles Accidents Claims Tribunal, Adilabad) against the Judgment and Award dated 10-3-1988 passed in O.P. No. 127 of 1986. Though the learned Addl. District Judge disposed of O.P. No. 126 and 127 of 1986 by a common Judgment, now we are concerned with the Judgment and Award in so far as it pertains to O.P. No. 127 of 1986.
The learned counsel appearing for the appellant Mr. S. Hanumaiah, Seriously contested the Judgment and Award in so far as it fixes the liability on the appellant/Insurance Company contending that having regard to the facts and circumstances of the case, no liability could have been fixed on the appellant.
In order to appreciate the arguments of learned counsel for the appellant, a few facts of this case would be necessary. The deceased Vijaya Kumar Goud, having taken the motor cycle bearing No. API 6300 from his brother, was driving the same on 5-12-1985 at about 6-30 p.m and when he was passing Umdam village, a Double Bullock Cart came infront of that motor cycle and the bullocks of the said cart were frightened and the said D.B. cart gave a dash against the motor cycle on which the deceased was driving and as a result, the deceased sustained injuries and died on the spot. It appears that there was another person driving on the said vehicle as a pillion driver. He sustained minor injuries.
On the basis of these facts, the claimants, who are the legal representatives of the deceased, filed the above Claim Petition. In support of their case, P.Ws. 1 to 3 have been examined. P.W. 3 is said to be an eye-witness to the occurrence. P.Ws. 1 and 2 are not the direct witnesses. Relying on the evidence of P.W. 3, while answering Issue No. 1, the lower court held as follows:-
"There is no evidence adduced by the respondents to show that there was any fault on the part of the deceased. On the other hand, the evidence of P.W. 3 coupled withEx.A-3/true copy of FIR; Ex. A-4/true copy of inquest report and Ex. A-5/ the photostat copy of post-mortem report clinchingly established that the accident occurred not due to the fault of the deceased."
While answering Issue No. 2, the lower court came to the conclusion that the claimants were entitled to the compensation of Rs. 90,000/- in aggregate. The contest issue-so far as the appellant is concerned was issue No. 3 decided by the lower court. With reference to this issue, the appellant examined RW. 1, the Branch Manager of the appellant and he deposed that Ex. B-1 was the insurance policy issued by their branch office for the vehicle involved in the accident and owned by the 2nd respondent in the O.P. The 2nd respondent in the O.P., ie., 5th respondent herein, is no other than the brother of the deceased. It is not in dispute that the vehicle belonged to the 2nd respondent in that O.P. On the basis of the evidence, it is clear that the deceased had borrowed the said vehicle from his brother. From the evidence of R.W. 1, it is clear that the said vehicle was insured with the appellant Insurance Company so as to cover the third party risk. On the basis of the evidence of R.W. 1 and Ex. B-1, the Insurance Company streneously contended before the Claims Tribunal that it was not liable to pay compensation and having regard to the facts and circumstances of the case, it is not a case of any vicarious liability. However, the lower tribunal gave a finding that Under Sections 95 (1) and 96 (2) (ii) of the Motor Vehicles Act, 1939, hereinafter referred to as ''the Act'' the insurance company was liable. In this appeal, the learned counsel for the appellant contested this finding of the claims tribunal, in fixing the liability of the insurance company jointly and severally along with the owner of the vehicle, the 2nd respondent in the O.P.
On he basis of the evidence of R.W. 1 and Ex. B-1, the Claims Tribunal has concluded that the insurance policy covered only ''third party'' risk. On the basis of the policy, which covers only a third party risk, whether the Insurance Company could be fastened with the liability having regard to the facts of this case, is a serious question I am considering presently. Since the accident occurred on 5-12-1985, it is the M.V. Act, 1939 that would be applicable to the facts of the case. Section 95 (1) of the Act reads as under:-
"95. Requirements of policies and limits of liability:
(1) In order to comply with the requirements of this Chapter, a policy of insurance may be a policy which-
(a) is issued by a person who is an authorised insurer or by a co-operative society allowed u/s 108 to transact the business of an insurer, and
(b) insures the person or classes of persons specified in the policy to the extent specified in Sub-section (2)-
(i) against any liability which may be incurred by him in respect of the death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place.
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 employees of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen''s Compensation Act, 1923 in respect of the death of, or bodily injury to, any such employee-
(a) engaged in driving the vehicle, or
(b) if it is a public service vehicle, engaged as a conductor of the vehicle or in examining tickets on the vehicle, or
(c) if it is a goods vehicle, being carried in the vehicle; or
(ii) except where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of 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; or
(iii) to cover any contractual liability;"
From the reading of this provision, it is clear that the Insurance company would be liable jointly and severally along with the owner of the vehicle under this section on the following counts: i.e., against any liability which may be incurred by him in respect of the death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place; and against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place. Under the proviso to the said section, it has been provided that such policy shall not cover the liability in respect of the death arising out of and in the course of his employment, of the employees of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen''s Compensation Act, 1923 in respect of the death of, or bodily injury to, any such employee engaged in driving the vehicle; or if it is a public service vehicle engaged as a conductor of the vehicle or in examining tickets on the vehicle; or it it is a goods vehicle, being carried in the vehicle.
As an exception it is provided under Clause (ii) of the proviso, that the Insurance Company would be liable, where the vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of the 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.
Now, the question for me is to consider whether the case on hand falls under main principle vide Clause (b) (i) or at least under Clause (ii) of the proviso. It is not in dispute that the vehicle in question belonged to the brother of the deceased, and the deceased was using the vehicle in the public place and while using the vehicle, he sustained bodily injuries. But from the finding given by the Claims tribunal, it is clear that the deceased himself was not driving the vehicle negligently and the negligence that was attributed was to the driver of the bullock cart, who is not made a party to the case as one of the co-respondents nor there is any claim against that owner of the bullock cart. The principle laid down in Section 95 of the Act is nothing but the principles of vicarious liability. The principle of vicarious liability, which has been earlier the Common Law Principle has been codified in Section 95 of the Act. Section 95 of the Act is nothing but a replica of British Act viz., Road Traffic Act, 1972. In order to fix the liability on the Insurance Company, it is therefore necessary to make the owner of the vehicle liable primarily for the rash and negligent driving of the driver or some other person authorised by him so as to make such person vicariously liable.
In the instant case, on doubt the deceased, being the brother of the owner of the vehicle, himself was driving the vehicle. As per the finding of the tribunal, he was not driving the vehicle rashly and negligently and it is not the evidence of the claimants also that the deceased was driving the vehicle rashly and negligently. The simple case made out by them is that the deceased was driving the motor cycle in question and it is the driver of the cart who hit the motor cycle, as a result of which the deceased sustained injuries and died on the spot. So, primarily there is no negligence on the part of the deceased as a driver of the vehicle so as to make the owner liable, assuming for the sake of argument that the deceased was driving the vehicle as a driver on behalf of the owner. At any rate, he was not the driver as commonly understood for the owner. Having regard to the facts and circumstances of the case, absolutely there is no relationship of servant and master between the deceased and the owner of the motor cycle i.e., 2nd respondent in the O.P. This must be established as a basic fact in order to make the Insurance Company (appellant herein) liable co-extensively along with the owner of the vehicle. From the evidence on record, this fact itself is not proved in this case.
As stated above, at the cost of repetition, I should say that the Insurance Company would be only liable when the owner of the vehicle is liable. The insurance company simply takes over the liability of the owner and nothing more. I am fortified by a decision of the Supreme Court for this proposition in Minu B. Mehta and Another Vs. Balkrishna Ramchandra Nayan and Another, . The Supreme Court held as follows:-
"The liability of the owner of the car to compensate the victim in a car accident due to the negligent driving of his servant is based on the law of tort. Regarding the negligence of the servant the owner is made liable on the basis of vicarious liability. Before the master could be made liable, it is necessary to prove that the servant was acting during the course of his employment and that he was negligent. u/s 95 (1) (b) (i) it is required that policy of insurance must be a policy which insures the person against any liability which may be incurred by him in respect of the death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. The insurance policy is only to cover the liability of a person which he might have incurred in respect of the death or bodily injury. The accident to which the owner or the person insuring is liable is to the extent of his liability in respect of the death or bodily injury and that liability is covered by the insurance. Therefore, if the owner has not incurred any liability in respect of the death or bodily injury to any person, there is no liability and it is not intended to be covered by the insurance. The expression "liability which may be incurred by him" is meant as covering any liability arising out of the use of the vehicle. A person is not liable unless he contravenes any of the duties imposed on him by common law or by the statute. In the case of a motor accident the owner is only liable for negligence and on proof of vicarious liability for the acts of his servant. Proof of negligence is therefore necessary before the owner or the insurance company could be held to be liable for the payment of compensation in a motor accident claim case."
From the Law declared by the Hon''ble Supreme Court in the above decision, it is clear that proof of negligence on the part of the driver is necessary before the owner or Insurance Company could be held liable for payment of compensation in the motor accidents claims. In the instant case, it cannot be said that the deceased was a driver of the owner of the vehicle. Assuming that he was driving the vehicle as a driver, even then the finding is that he was not driving the vehicle rashly and negligently. Therefore, it is clear that there was no liability on the part of the owner to pay the compensation to the deceased. Therefore, absolutely there cannot be any liability on the Insurance Company.
From the facts of this case, it is clear that the deceased was in the position of the owner himself, in the sense that he was driving the vehicle belonging to his brother and he was not driving for or on behalf of the owner of the vehicle. It is also not a case that there was any contract of employment between the owner of the vehicle and the deceased on the basis of the material on record. As per the finding of the Claims Tribunal, the vehicle was covered with the third party risk. Now, a question arises whether the claimants are entitled to compensation on the basis of the insurance policy, Ex. B-1, that it covered third party risk and the deceased was the third party for the purpose of compensation. Thus, the question would be who is a ''third party'' who would be entitled to compensation from the Insurance Company if the vehicle in question is covered by the insurance policy only in regard to the third party risk. This is a question that has to be considered depending on the facts of each case.
The Act itself has not defined who is a ''third party''. At any rate, it is a common knowledge that the driver of the vehicle would not constitute a third party for purpose of Section 95 of the Act. Considering the similar provision tinder Section 145 of the Road Traffic Act, 1972, in a reported case Cooper v. Motor Insurers'' Bureau,1985 Q.B. 575, the Appeal Court in England has held as follows:-
"A policy covering him ''in respect of third party risks'' clearly does not include the actual driver of the vehicle at the time of the use of the vehicle which gives rise to the damage. The scope of phrase ''any person'' in Section 145 (3) (a) is limited by Section 143 (1) so as to exclude the driver of the vehicle. "(Extracted from Bingham''s Motor Claims Cases of Butter-Worths Publication, 9th edition, Page No. 743)
From this position of Law, it is clear that the driver cannot constitute as third party for the purpose of Section 95 (1) of the Act. Therefore it is clear that if the deceased is treated as a driver of the vehicle in question his L.Rs. would not be entitled to claim any compensation.
The next question would be whether the claimants would be entitled to compensation treating the deceased as a passenger on the motor cycle and as such, a passenger. Dealing with the similar contention in Pushpabai Purshottam Udeshi and Others Vs. Ranjit Ginning and Pressing Co. (P) Ltd. and Another, , the Hon''ble Supreme Court has laid down the Law as under:-
''Section 95 (a) and (b) (i) of the Motor Vehicles Act adopted the provisions of the English Road Traffic Act, 1960, and excluded the liability of the insurance company regarding the risk to the passengers. Section 95 provides that a policy of insurance must be a policy which insures the persons against any liability which may be incurred by him in respect of death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. The plea that the words "third party" are wide enough to cover all persons except the person and the insurer is negatived as the insurance cover is not available to the passengers made clear by the proviso to Sub-section which provides that a policy shall not be required."
It is further held:-
"The insurer can always take policies covering risks which are not covered by the requirements of Section 95 of the Act. In this case, the insurer had insured with the insurance company the risk to the passengers. By an endorsement to the policy the insurance company had insured the lability regarding the accidents to passengers........."
But in the case on hand, the insurer had not taken any special coverage regarding the passengers by paying extra premium required for that purpose. As per the Law declared by the Hon''ble Supreme Court, in the above case, unless the insurer takes a special coverage even regarding the risk to the passengers, the insurance company would not be liable. In the instant case, passenger is not covered by the Insurance policy. From this Law declared by the Supreme Court, it is clear that the passengers cannot be treated as third parties. Therefore, even the contention of the claimants that they are entitled to compensation as the third party treating the deceased as a passenger is not acceptable.
The last contention urged by the learned counsel for the claimants is that since the motor cycle was insured by its owner, the deceased being the brother of the owner at least can claim the compensation in the capacity of the owner of the vehicle. In fact, a similar question did arise in this Court and the matter was referred to the Division Bench by the learned single Judge opining that the case involves important question of Law to be decided by the Division Bench in A.A.O. No. 453 of 1986. Speaking for the Division Bench, Mr. Justice Syed Shah Mohammed Quadri, vide his judgment dated 13-4-1993, after referring number of decisions reported in National Insurance Co. Ltd., New Delhi Vs. Jugal Kishore and Others, ; M. Akkavva v. New India Assurance Company Ltd. ( 1988 ACJ 445); Mathew Koshy v. The Oriental Insurance Co. Ltd. (II (1988) ACC 504)); The Oriental Fire and General Insurance Co. Ltd. Vs. Smt. Shakuntala Devi, ; Oriental Insurance Co. Ltd. v. Chimajirao Kanhojirao Shirke (1992 ACJ 452); Premier Insurance Co. Ltd., Vijayawada v. Siromanamma (AIR 1988 AP 396); Minu B. Mehta and Another Vs. Balkrishna Ramchandra Nayan and Another, ; and Pushpabai v. Ranjit Ginning & Pressing Co. Pvt. Ltd., (3 supra); held as follows:-
"The liability of the insurance company is to indemnify the insured against the claim of a third party but not to pay compensation for injury or death of the insured - owner of a vehicle who died while driving the vehicle due to accident."
From this declaration of law made by the Division Bench of this Court, it is clear that even on this court, the claimants cannot succeed and accordingly, this contention is hereby rejected.
From the discussion referred to above, it is clear that the Judgment and award passed by the Claims Tribunal so far as it pertains to the appellant/ Insurance Company making it liable along with the owner of the vehicle is hereby set aside. It is further made clear that absolutely there is no liability on the insurance company, the appellant herein, to pay compensation.
In the result, I allow the appeal filed by the insurance company and set aside the Judgment and award of the claims Tribunal in so far as it relates to the liability of the appellant/Insurance Company and the Claim Petition filed by the Claimants in so far it pertains to the Insurance Company, the present appellant herein, is hereby dismissed. But having regard to the facts and circumstances of the case, there shall not be any order to costs.
Cross-objections
Order (made on 3-9-1994)
The C.M.A. is filed by the United India Insurance Company Limited, Adilabad against the Judgment and Award dt. 10-3-1988 in O.P. No. 127/86on the file of the Motor Accidents Claims Tribunal, Adilabad. This appeal was heard by me and allowed on 5-8-1994 so far as it pertains to the appellant Insurance company.
Now, the office has put up a note that there is Cross-objection filed in this appeal by the claimants and same was not disposed of.
Since, the existence of Cross-objection was not brought to my notice when the CMA was disposed of, the cross-objection has remained on the file. Now the office has posted the said cross objection for order of the Court.
None appears on behalf of Cross-objections. Hence, the Cross-objection is dismissed for default.