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CASE NO.: Appeal (civil)  38 of 1999

PETITIONER: Jameskutty Jacob                                                 

RESPONDENT: Vs. United India Insurance Co. Ltd. & Ors.                   

DATE OF JUDGMENT: 05/08/2003

BENCH: S. N. VARIAVA & (H. K SEMA.

JUDGMENT:

J U D G M E N T

S. N. VARIAVA, J.

       This Appeal is against the Judgment dated 17th October, 1997.         Briefly stated the facts are as follows: On 5th February, 1986 an accident took place in which a young boy  was seriously injured.  A claim was filed against the Appellant, who  was shown as the owner of the vehicle, and the Insurance Company.   The Motor Accident Claims Tribunal awarded a sum of Rs. 2,00,000/-  with interest thereon.  In so awarding it did not accept the contention  of the Appellant that the Appellant was not owner of the vehicle  inasmuch as he had sold the vehicle in 1983.   The Motor Accident  Claims Tribunal also did not accept the contention that the liability of  the Insurance Company was limited to Rs. 50,000/-.  It held both the  Appellant and the Insurance Company jointly and severally liable.         The Insurance Company filed an Appeal.  It claimed that the  Policy was an ’Act only’ policy on which no extra premium had been  paid for making the liability unlimited.   It was submitted that as the  policy was an ’Act only’ policy the liability of the Insurance Company  was limited to Rs. 50,000/- only under Section 95 (2)(b)(i) of the  Motor Vehicles Act, 1939.   The High Court accepted this contention  and limited the liability of the Insurance Company to a sum of Rs.  50,000/-.             After this Appeal was filed this Court directed the Insurance  Company to produce the complete policy as also any other document  to show that the vehicle insured was a taxi and not a private car.   The  Insurance Company had produced the policy.  We, however, do not  find, from the Policy or from any other document produced on record,  that the vehicle was a taxi.   Undoubtedly the policy is an ’Act only’  policy, however, even in respect of an ’Act only’ policy the Insurance  Company would be liable for the statutory amount as payable under  Section 95 of the Motor Vehicles Act, 1939.  The relevant portion of  Section 95 reads as follows: 95. Requirements of policies and limits of liability.- (1)             xxx             xxx             xxx                 xxx             xxx             xxx

(2)     Subject to the proviso to sub-section (1), a policy of  insurance shall cover any liability incurred in respect of any  one accident up to the following limits, namely - (a)     where the vehicle is a goods vehicle, a limit of  one lakh and fifty thousand rupees in all,  including the liabilities, if any, arising under  the Workmen’s Compensation Act, 1923 (8 of  1923), in respect of the death of, or bodily  injury to, employees (other than the driver),

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not exceeding six in number, being carried in  the vehicle; (b)     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,- (i)     in respect of persons other than  passengers carried for hire or reward,  a limit of fifty thousand rupees in all; (ii)    in respect of passengers, a limit of  fifteen thousand rupees for each  individual passenger; (c)     save as provided in clause (d), where the  vehicle is a vehicle of any other class, the  amount of liability incurred; (d)     irrespective of the class of the vehicle, a limit  of rupees six thousand in all in respect of  damage to any property of a third party.

(3)                     xxx             xxx             xxx

(4)                     xxx             xxx             xxx

(4-A)                   xxx             xxx             xxx

(5)                     xxx             xxx             xxx"

       Accordingly, it is to be seen that if the vehicle was a vehicle in  which passengers are carried for hire or reward then the liability would  be limited to Rs. 50,000/- under Section 95(2)(b)(i).   However, if the  vehicle does not carry passengers for hire or reward, then under  Section 95(2)(c) the liability of the Insurance Company would be the  amount of liability incurred. In this case, nobody has appeared on behalf of the Insurance  Company in spite of the fact that they were served.   We are informed  by counsel for the Appellant that there is no evidence on record to  show that the vehicle was a taxi.  We, therefore, fail to understand on  what basis the High Court has restricted the liability of the Insurance  Company to Rs. 50,000/-.        In view of the fact that it has not been  shown to us that the vehicle was a taxi, the case would be covered by  Section 95 (2)(c) and the liability of the Insurance Company would be  the amount of liability incurred, even though it is an ’Act only’ Policy.         Under the circumstances, the impugned Judgment of the High  Court is set aside and that of the Motor Accident Claims Tribunal is  reinstated.   

       The Appeal stands disposed of accordingly.  There will be no  order as to costs.