Allahabad High Court
The Oriental Insurance Co. Ltd. Thru ... vs Smt. Mithlesh And Ors. on 27 February, 2017
HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH AFR Court No. - 18 ( Reserved ) Case :- FIRST APPEAL FROM ORDER No. - 462 of 2016 Appellant :- The Oriental Insurance Co. Ltd. Thru Branch Manager Barabanki Respondent :- Smt. Mithlesh And Ors. Counsel for Appellant :- Vashu Deo Mishra Counsel for Respondent :- Abdul Rafey Siddiqui,Akhter Abbas Hon'ble Attau Rahman Masoodi,J.
As per service report dated 24.1.2017, service on respondents no. 1 to 4 is deemed sufficient under Chapter VIII Rule 12 Exp. II of the High Court Rules. Sri Abdul Rafey Siddiqui has put in appearance on behalf of respondents no. 1 and 2. Respondent no. 3 despite service being sufficient, has neither chosen to appear in person nor through counsel. Sri Akhter Abbas learned counsel has put in appearance on behalf of respondent no. 4.
This appeal was admitted by order dated 27.5.2016. The point for determination that has cropped up is a legal question, therefore, parties were heard in the light of material available on record. The factual grounds raised in the appeal are dependent upon the legal question hence need not be delved into in detail.
Insofar as the ownership of private vehicles operated on contract basis by Uttar Pradesh Road Transport Corporation (hereinafter referred to as the 'UPSRTC') is concerned, law is settled on the point by the apex court in the case reported in (2011) 8 SCC 142 (Uttar Pradesh State Road Transport Corporation v. Kulsum and others).
It is no more res integra that once a private vehicle is plied by UPSRTC on contract basis, its ownership will vest in the State Undertaking by virtue of definition contained in Section 2 (30) of the Motor Vehicles Act, 1988 (hereinafter referred to as the Act) which reads as under:
"2 (30) "owner" means a person in whose name a motor vehicle stands registered, and where such person is a minor, the guardian of such minor, and in relation to a motor vehicle which is the subject of a hire-purchase, agreement, or an agreement of lease or an agreement of hypothecation, the person in possession of the vehicle under that agreement."
The question that has arisen in the present appeal is, as to whether a private vehicle operated by UPSRTC on contract basis, if not possessed with a permit under section 66 of the Act, can at all be operated by a State Undertaking as per the permits issued in their favour under the Act and as to whether lack of permit under section 66 in respect of such a vehicle would amount to violation of the conditions incorporated in the insurance policy placed reliance upon and benefit of Section 149 (2) would be available to the appellant.
The first and foremost argument advanced by learned counsel for the appellant is that for the purpose of plying any vehicle on a notified route, whether by a private owner or UPSRTC, possession of permit under Section 66 of the Act is a condition precedent. The absence of a permit under Section 66 would thus being violative of the provisions of the Act would constitute breach of the insurance policy, hence the statutory defence is available to the appellant. The relevant clause stipulated in the insurance policy for ready reference is reproduced below:
"Limitations as to Use The Policy covers use only under a permit within the meaning of the Motor Vehicle Act 1988 or such a carriage falling under sub-section 3 of Section 66 of the Motor Vehicles Act, 1988"
Be it clarified at the outset that the condition incorporated in the insurance policy is marked by a disjunctive clause, therefore, the stipulation has to be given its full meaning. The stipulation runs into two parts; the first part essentially requires the vehicle to be possessed with a permit issued under the Motor Vehicles Act, 1988 and the second condition incorporated in the insurance policy is exclusionary. Essentially a vehicle as per the stipulations in the insurance policy is bound to have a permit under the Act. The question that immediately crops up is as to whether the buses plied by UPSRTC on contract basis are required to have permit under Section 66 of the Act or a permit issued under the Act once possessed with would comply with the requirement of law.
Chapter V and Chapter VI of the Act contain provisions which operate independent of each other. Chapter VI envisages the provisions which are exclusively applicable to State Transport Undertakings.
Before coming to the relevant provisions it is apt to make a reference to Section 217 (2)(b) of the Act, which for ready reference, is extracted below:
"217. (2) Notwithstanding the repeal by sub-section (1) of the repealed enactments,--
(a) ............................................;
(b) any certificate of fitness or registration or licence or permit issued or granted under the repealed enactments shall continue to have effect after such commencement under the same conditions and for the same period as if this Act had not been passed;"
The aforesaid provision clearly demonstrates that a permit issued or granted under the repealed enactments shall continue to have effect after such commencement under the same conditions and for the same period as if the Act had not been passed. It is not the case of appellant that the vehicle plied by UPSRTC at the relevant point of time was not possessed with a permit but what is argued in the present case is that the permit so issued was not a permit within the meanings of Section 66 of the Act. For this purpose it would be necessary to refer to Section 98, 103 (1) and 103 (1A) of the act which are reproduced hereunder:
"98. Chapter to override Chapter V and other laws.--The provisions of this Chapter and the rules and orders made thereunder shall have effect notwithstanding anything inconsistent therewith contained in Chapter V or in any other law for the time being in force or in any instrument having effect by virtue of any such law."
"103. Issue of permits to State transport undertakings.--
(1) Where, in pursuance of an approved scheme, any State transport undertaking applies in such manner as may be prescribed by the State Government in this behalf for a stage carriage permit or a goods carriage permit or a contract carriage permit in respect of a notified area or notified route, the State Transport Authority in any case where the said area or route lies in more than one region and the Regional Transport Authority in any other case shall issue such permit to the State transport undertaking, notwithstanding anything to the contrary contained in Chapter V. (1A) It shall be lawful for a State transport undertaking to operate on any route as stage carriage, under any permit issued therefor to such undertaking under sub-section (1), any vehicle placed at the disposal and under the control of such undertaking by the owner of such vehicle under any arrangement entered into between such owner and the undertaking for the use of the said vehicle by the undertaking."
A plain reading of the provisions extracted above, clearly shows that Section 98 gives an overriding effect to the provisions contained in Chapter VI of the Motor Vehicles Act, 1988. Section 103 sub-section (1) contains non-obstante clause, therefore, any provision contained in Chapter V inconsistent with the provisions of Chapter VI of the Act would have no application.
Insofar as the question of issuance of permit is concerned, Section 103 (1) of the Act clearly envisages the mechanism for issuance of permits in favour of UPSRTC. Once an independent provision for issuance of permits is stipulated under the statute, to say that for operating a vehicle by UPSRTC under Section 103(1A) of the Motor Vehicles Act, 1988, a permit under Section 66 of the Act would be necessary, in my humble consideration, such a proposition of law is misconceived and does not deserve acceptance. The rejection of contention is further strengthened when we look at the definition of owner as defined under Section 2(30) of the Act quoted hereinabove.
Section 103(1A) was inserted by U.P. Act No. 5 of 1993 w.e.f. 17.1.1993 and is applicable insofar as the present case is concerned. Once a motor vehicle operated by UPSRTC is fully covered under the provisions of Chapter VI of the Act, there is no reason as to why the stipulation incorporated in the insurance policy may require satisfaction of permit issued under Section 66 of the Act for a vehicle covered under the provisions of Section 103 read with Section 103 (1A) of the Act.
There is yet another reason as to why meaning of stipulation in the insurance policy be not confined and interpreted within the ambit of Section 66. The stipulation itself provides for a permit issued under the provisions of Motor Vehicles Act, 1988. The condition in the insurance policy is wide enough to bring all the types of permits conceived under the Act within the cover of insurance policy, as such, the question raised by the appellant on the strength of Section 66 of the Act is without any legal foundation. The plea advanced by learned counsel for the appellant was also considered in the light of relevant Rules i.e. U.P. Motor Vehicle Rules, 1998. Rule 130 of the above Rules prescribes the procedure for issuance of permits in favour of UPSRTC in Form SR-46. Form SR-46 as is prescribed for the vehicles operated by UPSRTC clearly mentions the issuance of such a permit under Section 103 of the Act, whereas, the vehicles operated privately are to be issued a permit in Form SR-29 which is regulated under Section 66 of the Act. This is however, not to suggest that a privately operated vehicle may not have a permit under Section 66 of the Act. It may be fruitful to bear in mind that private operators first of all purchase a vehicle which is bound to have a permit and then comes operation of a vehicle on the notified route; but for a State Undertaking, a route under a scheme comes into existence first which follows by a permit and operation of vehicle in terms of permit comes last.
Once the prescribed statutory norms for the purposes of issuance of permit stand at variance, there is no reason as to why the permits issued under Chapter V and Chapter VI of the Act may not be treated to be satisfying the condition of insurance policy placed reliance upon. The two chapters being mutually exclusive provide for distinct permits which have to operate interdependently.
It was lastly argued that once a motor vehicle is operated on the basis of an arrangement i.e. contract, such a condition does not stand indemnified in terms of second proviso appended to Section 147 (1) of the Act even if the insurance policy is operative. The submission put forth when tested in the light of Section 146 read with Section 157 of the Act does not deserve acceptance.
The ground of multiplier argued by learned counsel for the appellant is also not made out looking to the recent view of the apex court in the judgment rendered in the case of Munna Lal Jain and another v. Vipin Kumar Sharma reported in (2015) 6 SCC 347.
No other point was argued before this Court.
The appeal fails and is hereby dismissed. No order as to cost.
Order Dated :- Feb. 27, 2017 Fahim