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CASE NO.: Appeal (civil)  1667 of 2008

PETITIONER: National Insurance Co. Ltd

RESPONDENT: Prema Devi & Ors

DATE OF JUDGMENT: 29/02/2008

BENCH: Dr. ARIJIT PASAYAT & P. SATHASIVAM

JUDGMENT: JUDGMENT CIVIL APPEAL NO. 1667 2008 (Arising out of SLP(C) No. 7058/2004)

Dr. ARIJIT PASAYAT, J

1.      Leave granted. 2.      Challenge in this appeal is to the order passed by a  learned Single Judge of the Allahabad High Court, Lucknow  Bench dismissing the appeal filed by the appellant.   

3.      Background facts in a nutshell are as follows: The accident in the instant case took place on 1.6.1996.   The claimant was travelling in a goods carriage, as a  gratuitous passenger. Undisputedly she was not traveling in  the goods carriage in the capacity of owner of goods or  representative of owner of goods being transported in the  goods carriage.  This aspect was also accepted by the claimant  in the claim petition.

4.      Stand of the appellant was that the owner of the goods  carriage had not taken any policy for such passenger and  there was no requirement under law for obtaining a policy for  passenger.

5.      Learned counsel for the appellant submitted that the  claimant could not claim indemnification by the appellant and  the owners of the offending vehicles were to indemnify the  award.

6.      Learned counsel for the claimant and the owners of the  offending vehicles supported the order of the High Court.

7.      In New India Assurance Co. Ltd. v. Vedwati and Ors.   (2007 (3) SCALE 397), it was held as under:  "6. 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’). 7.      The present appeals belong to the second  category. 8.      In Satpal Singh’s case (supra) this Court  proceeded on the footing that provisions of

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Section 95(1) of the old Act are in pari materia  with Section 147(1) of the Act as it stood prior  to the amendment in 1994. 9.      On a closer reading of the expressions  "goods vehicle". "public service vehicle", "state  carrier" and "transport vehicle" occurring in  Sections 2(8), 2(25), 2(29) and 2(33) of the old  Act with the corresponding provisions i.e.  Section 2(14), 2(35) 2(40) and 2(47) of the Act,  it is clear that there are conceptual differences.  The provisions read as follows: Old Act: "2 (8) "goods vehicle" means any motor vehicle  constructed or adapted for use for the carriage  of goods, or any motor vehicle not so  constructed or adapted when used for the  carriage of goods solely or in addition to  passengers" "2(25) "public service vehicle" means any motor  vehicle used or adapted to be used for the  carriage of passengers for hire or reward and  includes a motor cab contract carriage, and  stage carriage." "2(29) "stage carriage" means a motor vehicle  carrying or adapted to carry more than six  persons excluding the driver which carries  passengers for hire or reward at separate fares  paid by or for individual passengers either for  the whole journey or for stages of the journey:" "2(33) "transport vehicle" means a public  service vehicle or a goods vehicle:" The Act (New Act): "2(14) "goods carriage" any motor vehicle  constructed or adapted for use solely for the  carriage of goods or any motor vehicle not to  constructed or adapted when used for the  carriage of goods:" "2(35) "public service vehicles" means any  motor vehicles used or adapted to be used for  the carriage of passengers for hire or reward,  and includes a maxicab a motorcab, contract  and stage carriage:" " 2(40) "stage carriage" means a motor vehicle  constructed or adapted to carry more than six  passengers excluding the driver for (SIC) or  reward at separate fares paid by or for  individual passengers either for the whole  journey or for stages of the journey:" "2(47) "transport vehicle" means a pubic  services vehicle a goods carriage an  educational institution bus or a private service  vehicle:" (Underlined for emphasis) 10.      "Liability" as defined in Section 145(c) of  the Act reads as follows: "Liability", wherever used in relation  to the death of or bodily injury to  any person, includes liability in  respect thereof under Section 140."

11.      Third party risks in the background of  vehicles which are subject-matter of insurance  are dealt with in Chapter VIII of the old Act  and Chapter XI of the Act. Proviso to Section  147 of the Act (sic) is to be (sic) with Section 96

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of the old Act. Proviso to Section 147 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 employment 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) if it 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."

12.     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."

13.      The difference in the language of "goods  vehicle" as appear in the old Act and "goods  carriage" in the Act is of significance. A bare  reading of the provisions makes it clear that  the legislative intent was to prohibit goods  vehicle from carrying any passenger. This is  clear from the expression "in addition to  passengers" as contained in definition of "good  vehicle" in the old Act. The position becomes  further clear because the expression used is  "good carriage" is solely for the carriage of  goods. Carrying of passengers in a goods  carriage is not contemplated in the Act. There  is no provision similar to Clause (ii) of the  proviso appended to Section 95 of the old Act  prescribing requirement of insurance policy.  Even Section 147 of the Act mandates  compulsory coverage against death of or bodily  injury to any passenger of "public service  vehicle". The proviso makes it further clear  that compulsory coverage in respect of drivers

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and conductors of public service vehicle and  employees carried in goods vehicle would be  limited to liability under the Workmen’s  Compensation Act, 1923 (in short ’WC Act").  There is no reference to any passenger in  "goods carriage". 14.      The inevitable conclusion, therefore, is  that provisions of the Act do not enjoin any  statutory liability on the owner of a vehicle to  get his vehicle insured for any passenger  travelling in a goods carriage and the insurer  would have no liability therefor. 15.     Our view gets support from a recent  decision of a three-Judge Bench of this Court  in New India Assurance Company Limited v.  Asha Rani and Ors. (2002 (8) Supreme 594] in  which it has been held that Satpal Singh’s  case (supra) was not correctly decided. That  being the position, the Tribunal and the High  Court were not justified in holding that the  insurer had the liability to satisfy the award. 16.     This position was also highlighted in  Oriental Insurance Co. Ltd. v.  Devireddy  Konda Reddy and Others (2003(2) SCC 339).  Subsequently also in National Insurance Co.  Ltd. v. Ajit Kumar and Others   (2003(9) SCC  668), in National Insurance  Co. Ltd. v. Baljit  Kaur and Others (2004 (2) SCC 1) and in  National Insurance Co. Ltd. v. Bommithi  Subbhayamma and Others (2005 (12) SCC  243),  the view in Asha Rani’s case (supra) was  reiterated."   8.      Above being the position, the impugned order of the High  Court is not sustainable and is set aside. It is open to the  claimant to recover the amount awarded from the owners of  the offending vehicles.

9.      The appeal is allowed with no order as to costs.