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2025 DAILYLAW 3683 (HP)

Jai Chand v. United India Insurance Co. Ltd.

2025-12-10

Sushil Kukreja

body2025
JUDGMENT : SUSHIL KUKREJA, J. 1. The instant appeal has been preferred by the appellant, who was respondent No. 3 before the learned Court below, against award dated 27.04.2013, passed by learned Motor Accidents Claims Tribunal, Kullu, District Kullu, H.P., (hereinafter referred to as “the learned Tribunal below”), in Claim Petition No. 35 of 2011, whereby the petition filed by petitioner Anarkali (since deceased) was allowed with costs and compensation of Rs. 2,53,000/- alongwith interest at the rate of 9% per annum from the date of filing the petition till its realization was awarded in favour of the petitioner, which was ordered to be paid by respondent No. 3 being owner of the vehicle in question. 2. The brief facts of the case are that on 09.11.2009, Mam Chand (since deceased) was coming from Jana towards Raison after selling his bakery products and on his way, he took lift from one Surinder Kumar, in a vehicle bearing registration No. HP-34A-4943. When the said vehicle reached Naggar Jhor, it met with an accident and Surinder Kumar and Mam Chand died on the spot. As per the petitioner, deceased was running a bakery shop under the name and style of “Kisan Bakery” and was earning Rs. 20,000/- per month, as such, compensation to the tune of Rs. 10,00,000/- was claimed. 3. Respondent No. 1, by filing reply, contested the petition and stated that he had sold the vehicle on 04.02.2009 to one Jai Chand and at the time of accident Jai Chand was the owner of the vehicle in question. 4. Respondent No. 2/Insurance Company in its reply took preliminary objections that driver of the vehicle was not possessing valid and effective driving licence to drive the vehicle in question and the vehicle was being plied in contravention of the provisions of the Motor Vehicles Act and the vehicle was being plied without valid documents. On merits, income and occupation of the deceased has been denied and it has been pleaded that the deceased was travelling as gratuitous passenger in the vehicle. 5. Respondent No. 3 in his reply stated that he had purchased the vehicle from respondent No. 1 on 20.05.2010. He admitted that vehicle in question met with an accident on 09.11.2009, in which, Surinder Kumar and Mam Chand had died. 6. On pleadings of the parties, the following issues were framed on 22.06.2012:- “1. 5. Respondent No. 3 in his reply stated that he had purchased the vehicle from respondent No. 1 on 20.05.2010. He admitted that vehicle in question met with an accident on 09.11.2009, in which, Surinder Kumar and Mam Chand had died. 6. On pleadings of the parties, the following issues were framed on 22.06.2012:- “1. Whether Mam Chand had died in an accident on account of rash and negligent driving of deceased driver of vehicle No. HP-34A-4943? OPP 2. If issue No. 1 is proved in affirmative, to what amount of compensation the petitioner is entitled and from whom? OPP 3. Whether respondent No. 2 being indemnifier is liable to pay the compensation? OPR-1 4. Whether the vehicle was being plied in breach of terms and conditions of the Insurance Policy? OPR-2 5. Whether the deceased driver was not having valid and effective driving licence at the time of accident? 6. Whether the deceased was travelling in the vehicle in question as gratuitous passenger? OPR-2 7. Relief.” 7. After the parties led evidence and after hearing the learned Counsel for the parties, the petition was allowed with costs and compensation of Rs. 2,53,000/- alongwith interest at the rate of 9% per annum from the date of filing of the petition till its realization was awarded in favour of the petitioner and respondent No. 3, being owner of the vehicle in question, was held liable to pay the same. 8. Feeling dissatisfied, respondent No. 3 preferred the instant appeal under Section 173 of the Motor Vehicles Act, (for short “MV Act”) for quashing and setting aside the impugned award, dated 27.04.2013. 9. I have heard the learned counsel for the appellant, learned counsel for respondents No. 1 & 3(a) and carefully examined the entire record. 10. Learned counsel for the appellant contended that the deceased was not travelling in the offending vehicle as a gratuitous passenger and the learned Tribunal below has erred in fastening the liability upon the owner of the vehicle in question, as such, the impugned award deserves to be modified to the extent that since the vehicle was insured at the relevant time, therefore, liability, if any, should have been fastened upon the Insurance Company and not upon the owner of the vehicle. 11. 11. Per Contra, the learned Counsel for the respondent No. 2/Insurance Company contended that the learned Tribunal below has correctly fastened the liability to pay the compensation on the owner of the vehicle in question, as the vehicle was having “Liability Only Policy” and the persons traveling in the same were not having any insurance coverage. He further submitted that the insured/owner of the vehicle paid no premium to cover the risk of the occupants of the vehicle and the vehicle was not comprehensively insured. 12. Now the question which arises for consideration before this Court is as to whether the risk of the occupants/persons traveling in the offending vehicle, other than the owner and driver has been covered and whether the owner was not liable to pay the amount of compensation to the petitioner. 13. Before adverting to adjudicate the instant appeal on merits, this court finds it germane to consider the current position of law with regard to the issue in hand. 14. In United India Insurance Co. Ltd. vs. Tilak Singh & Ors., 2006 (4) SCC 404 , the Supreme Court extended the ratio of Asha Rani case, 2003 (2) SCC 223 to vehicles other than goods vehicles as well in the following terms:- "20. The view expressed in Satpal Singh case [ (2000) 1 SCC 237 : 2000 SCC (Cri) 130] however, has been specifically overruled in the subsequent judgment of a Bench of three Judges in New India Assurance Co. Ltd. v. Asha Rani [ (2003) 2 SCC 223 : 2003 SCC (Cri) 493]. In that case the discussion arose in connection with carrying passengers in a goods vehicle. This Court after referring to the terms of Section 147 of the 1988 Act, as contrasted with Section 95 of the 1939 Act, held that the judgment in Satpal Singh case had been incorrectly decided and that the insurer will not be liable to pay compensation. In the concurring judgment of Sinha, J. after contrasting the language used in the 1939 Act with that of the 1988 Act, it has been observed (vide SCC p. 235, paras 25 and 27): "25. Section 147 of the 1988 Act, inter alia, prescribes compulsory coverage against the death of or bodily injury to any passenger of 'public service vehicle'. In the concurring judgment of Sinha, J. after contrasting the language used in the 1939 Act with that of the 1988 Act, it has been observed (vide SCC p. 235, paras 25 and 27): "25. Section 147 of the 1988 Act, inter alia, prescribes compulsory coverage against the death of or bodily injury to any passenger of 'public service vehicle'. Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle would be limited to the liability under the Workmen's Compensation Act. It does not speak of any passenger in a 'goods carriage'. xxx xxx xxx 27. Furthermore, sub-clause (i) of clause (b) of sub- section (1) of Section 147 speaks of liability which may be incurred by the owner of a vehicle in respect of death of 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, whereas sub-clause (ii) thereof deals with liability which may be incurred by the owner of a vehicle against the death of or bodily injury to any [2024:RJ- JD:32556] (9 of 12) [CMA-2207/2017] passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place." 21. In our view, although the observations made in Asha Rani case [ (2003) 2 SCC 223 : 2003 SCC (Cri) 493] were in connection with carrying passengers in a goods vehicle, the same would apply with equal force to gratuitous passengers in any other vehicle also. Thus, we must uphold the contention of the appellant Insurance Company that it owed no liability towards the injuries suffered by the deceased Rajinder Singh who was a pillion rider, as the insurance policy was a statutory policy, and hence it did not cover the risk of death of or bodily injury to a gratuitous passenger." 15. In National Insurance Co. Ltd. vs. Balakrishnan and Anr. , (2013) 1 SCC 731 , the Hon’ble Supreme Court while making a distinction between an "act only policy" and "Comprehensive/package policy" made following observation:- "26. In view of the aforesaid factual position, there is no scintilla of doubt that a "comprehensive/package policy" would cover the liability of the insurer for payment of compensation for the occupant in a car. , (2013) 1 SCC 731 , the Hon’ble Supreme Court while making a distinction between an "act only policy" and "Comprehensive/package policy" made following observation:- "26. In view of the aforesaid factual position, there is no scintilla of doubt that a "comprehensive/package policy" would cover the liability of the insurer for payment of compensation for the occupant in a car. There is no cavil that an "Act policy" stands on a different footing from a "comprehensive/package policy". As the circulars have made the position very clear and IRDA, which is presently the statutory authority, has commanded the insurance companies stating that a "comprehensive/package policy" covers the liability, there cannot be any dispute in that regard. We may hasten to clarify that the earlier pronouncements were rendered in respect of the "Act policy" which admittedly cannot cover a third-party risk of an occupant in a car. But, if the policy is a "comprehensive/package policy", the liability would be covered. These aspects were not noticed in Bhagyalakshmi [ (2009) 7 SCC 148 : (2009) 3 SCC (Civ) 87 : (2009) 3 SCC (Cri) 321] and,therefore, the matter was referred to a larger Bench. We are disposed to think that there is no necessity to refer the present matter to a larger Bench as IRDA, which is presently the statutory authority, has clarified the position by issuing circulars which have been reproduced in the judgment by the Delhi High Court and we have also reproduced the same." 16. In the case on hand, it is not in dispute that on 09.11.2009, vehicle bearing registration No. HP-34-A-4943 met with an accident on account of rash and negligent driving of its driver, as a result of which he died on the spot. Mam Chand (since deceased) was also sitting in the vehicle in question at the relevant time and he also died. The claim petition has been filed by wife of the deceased Mam Chand, wherein, she categorically stated that her husband had taken lift in the offending vehicle, which met with an accident, as a result of which, he sustained multiple grievous injuries on his body and died on the spot. 17. Admittedly, respondent No. 3, Jai Chand was the owner of the vehicle in question at the time of accident and in his reply, he has not denied that the deceased had not taken lift in the vehicle in question. 18. 17. Admittedly, respondent No. 3, Jai Chand was the owner of the vehicle in question at the time of accident and in his reply, he has not denied that the deceased had not taken lift in the vehicle in question. 18. The petitioner while appearing in the witness box as PW-2 tendered in evidence her affidavit, wherein, also she stated that deceased Mam Chand took lift in the vehicle, which met with an accident as a result of which, he died on the spot. However, no suggestion has been given to her that the deceased had not taken lift in the vehicle in question. 19. Respondent No. 2/Insurer had examined one Harish Kumar Verma, Branch Manager, United India Insurance Company, Kullu, H.P., who appeared in the witness box as RW-4 and he deposed that vehicle No. HP- 34-A-4943 was insured for a period w.e.f. 21.01.2009 to 20.01.2010. Under the Policy, apart from third party risk, the risk of owner and one employee was also covered therein. 20. At the very out-set, it may be pertinent to mention here that the insurance can be of two types, i.e., comprehensive/package policy of a private vehicle, which covers the insurance of the passengers traveling in the same and the other policy is known as “Liability Only Policy” wherein only the risk of the owner-driver is covered, but risk of an occupant of a private vehicle is not covered. 21. In the present case, the policy in question has been placed on record as Ex. RW-4/A, the perusal of which shows that it is “Liability Only Policy”, wherein only the risk of the owner -driver is covered and in this respect basic premium of Rs.670/-, Rs. 100 and Rs.25/- was paid by the insured. Its perusal nowhere suggests that it was package policy (comprehensive policy). The deceased was neither the owner of the vehicle in question, nor an employee of the owner. As per the policy, the Insurance Company will indemnify any driver, who is driving the motor vehicle on the insured’s order or with insured’s permission, provided that such driver shall fulfill and be subject to the terms, exceptions and conditions of the policy in so far as they apply. The perusal of the aforesaid policy shows that the risk of the occupants/persons traveling in the vehicle, other than the owner and driver has not been covered. The perusal of the aforesaid policy shows that the risk of the occupants/persons traveling in the vehicle, other than the owner and driver has not been covered. There is no statutory requirement to cover the risk of occupants in private vehicle. The risk of occupant in a private vehicle can only be covered by paying premium, which is not the case in the present matter. It is admitted fact that no premium was paid by the owner of the vehicle in question for covering the risk of the occupants. Learned Tribunal also exonerated the Insurance Company since the policy was 'Liability Only Policy'. 22. The risk of deceased, who was sitting in insured vehicle would not be covered by third party and hence, the appellant Insurance Company would not be liable to satisfy the award. It is well settled proposition of law that in such a case, provision of direction to pay and recover cannot be issued. 23. In view of my aforesaid discussion, since Insurance policy Ex. RW-4/A, was “Liability Only Policy” as such the same did not cover the risk of death or bodily injury to the persons traveling in the vehicle, therefore, learned Tribunal below has not committed any error while fastening the liability to pay the compensation on the appellant/respondent No. 3 who is the owner of the vehicle in question. 24. Hence, the appeal filed by the appellant being devoid of any merit is dismissed and the impugned award dated 27.04.2013 is upheld. 25. The appeal is disposed of, so also pending application(s), if any.