Himachal Pradesh High Court
The New India Assurance Company vs Shakuntla Devi And Others on 19 August, 2023
Author: Virender Singh
Bench: Virender Singh
1 IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA.
FAO No. 73 of 2013 Reserved on: 26.06.2023 Decided on: 19th August, 2023 .
The New India Assurance Company .......Appellant Versus Shakuntla Devi and others ...Respondents Coram of The Hon'ble Mr. Justice Virender Singh, Judge. Whether approved for reporting?1 Yes. For the appellant:
rt Mr. B.M. Chauhan, Senior
Advocate with Mr. M.S. Katoch
and Mr. Amit Himalvi,
Advocates.
For the respondents: Mr. H.S. Rangra, Advocate for
respondent No.1.
Mr. G.R. Palsra, Advocate for
respondents No. 2 to 7.
Virender Singh, Judge.
Appellant-The New India Assurance Company has filed the present appeal under Section 173 of the Motor Vehicle Act, 1968 (hereinafter referred to as the 'M.V. Act') against the award dated 20.10.2012 passed by learned Motor Accident Claims Tribunal-cum-Presiding Officer, Fast Track Court, Mandi, District Mandi, H.P. (hereinafter, referred to as the 'learned Tribunal').
1 Whether the reporters of Local Papers may be allowed to see the judgment? Yes.
::: Downloaded on - 19/08/2023 20:34:53 :::CIS 22. By way of award dated 20.10.2012, the learned Tribunal has decided the claim petition filed by respondent No. 1, bearing Claim Petition No. 86 of 2009 titled as .
Shakuntla Devi and others vs. The New India Assurance Company Limited and awarded a sum of Rs. 70,000/- to respondent No. 1 along-with interest @ 7.5 per annum from the date of filing the petition till the deposit of the award of amount. The liability to pay the amount of compensation along-with interest has been put on the appellant/Insurance rt Company.
3. The parties, to the present lis, are hereinafter, referred to, in the same manner, as were referred to, by the learned Tribunal.
4. In this case, following are the admitted facts:-
4.1. That on 02.06.2009, petitioner was going to Jogindernagar to meet her husband and took lift from village Bhadyara in vehicle No. HP-33-0037 (hereinafter referred to as the 'offending vehicle') being driven by Chaman Lal, predecessor-in-interest of respondents No. 1 to 6. Sh.
Chaman Lal, driver-cum-owner while driving the offending vehicle had moved just a distance of 200 meters, the vehicle in question, met with an accident and had fallen into a deep gorge. Due to the accident, the driver-cum-owner Chaman ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 3 Lal and one Duni Chand died on the spot and the petitioner sustained injuries.
4.2. The matter was reported to the police of Police .
Station, Jogindernagar. The petitioner sustained injuries and firstly, she was taken to Civil Hospital, Jogindernagar and thereafter, she was referred to Zonal Hospital, Mandi. The petitioner, thereafter, remained admit as indoor patient, in of Mandav Hospital, Mandi. According to her, she had spent Rs.35,000/- on her treatment.
rt
5. After affording opportunity to the parties to lead evidence, the learned Tribunal has allowed the petition by putting the liability to pay compensation on the Insurance-
Company.
6. In this case, except the Insurance-Company, no-
one has assailed the award.
7. The Insurance-Company has filed the present appeal mainly on the ground that insurance policy Ext. RW-
1/C is the act policy, as such, the occupant of the vehicle i.e. petitioner was not covered under the policy, which was in force, at the time of accident.
8. It is the further case of the Insurance-Company that since the occupants, in private car, cannot be treated, as ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 4 'third party' and under the terms of the policy of insurance, the Insurance-Company is not liable to pay compensation.
9. Challenging the liability of the Insurance-
.
Company to indemnify the owner, Mr. B.M. Chauhan, learned Senior Advocate assisted by Mr. M.S. Katoch and Mr. Amit Himalvi, Advocates, has prayed that the appeal may kindly be accepted by exonerating the Insurance-Company to pay the of amount of compensation.
10. The prayer has been opposed by the learned rt counsel for the petitioner, as well as respondents No.1 to 6 on the ground that the learned Tribunal has rightly saddled the liability upon the Insurance-Company to pay the amount of compensation. As such, a prayer has been made to dismiss the appeal.
11. Perusal of the record shows that the Insurance-
Company, before the learned Tribunal, has put forward the plea that the "policy in force" at the relevant time, does not include the petitioner, in the definition of 'third party' being the occupant of the vehicle. In this regard, the Insurance-
Company has relied upon the decision of the Hon'ble Apex Court in Yallwwsa vs. National Insurance Co. Ltd. 2007 A.C.J. 1934. In addition to this, the Insurance-Company has also relied upon the decision of the Hon'ble Apex Court in ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 5 Bhagyalakshmi and others vs. United Insurance Co. Ltd.
and another 2009 (4) T.A.C 393.
12. The plea which has been raised by the Insurance-
.
Company has been negated by the learned Tribunal, on the basis of decision of the Full Bench of Kerala High Court in Oriental Insurance Co. Ltd. vs. AjayaKumar, 1(2000) ACC 507 (FB), decision of the High Court of Jammu and Kashmir of in United India Insurance Co. Ltd. vs. Karam Chand and others AIR 2012 Jammu and Kashmir 20 and decision of the rt Karnatka High Court in Ramchandra vs. Shantaram and others, II (2005) ACC 746.
13. In this background, now, this Court proceeds to decide the question as to whether the petitioner, being the occupant of the offending vehicle, falls within the definition of 'third party' as occurred in Section 145 of the Motor Vehicles Act.
14. The Insurance-Company has placed on record the policy as Ext. R-1. This is the act policy covering 'third party' and compulsory personal accident covered for the driver-cum-
owner. It has been limited to the extent of Rs.2,00,000/-.
15. The Insurance-Company has examined RW-1 Assistant Manager, who has categorically stated that the occupants of the vehicle were not insured in the insurance ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 6 policy Ext. R-1. No premium of the occupants for extending the benefit of insurance cover to the occupants has been received/charged by the Insurance-Company. He has also .
admitted that the insurance cover of Rs.2,00,000/- has already been paid to the owner-cum-driver, who had died in the accident, in question.
16. The policy in question is Ext. R-1, has provided of the 'third party' cover, as well as compulsory P.A. cover to owner-cum-driver.
rt Meaning thereby that the third party premium has been paid, as per policy and not for the occupant of the vehicle. When the additional premium has not been paid, then, the petitioner does not fall within the definition of 'third party', but falls within the definition of 'gratuitous passenger.
17. The Hon'ble Apex Court in United India Insurance Co. Ltd., Shimla vs. Tilak Singh and others, (2006) 4 SCC 404 has elaborately discussed the effect of the act policy on the liability to pay compensation to the gratuitous passenger. The relevant paras 19 to 21 of the judgment are reproduced as under:-
"19. The argument that the risk pertaining to a third party would extend to a person other than the parties to the insurance contract was raised in New India Assurance Company v. Satpal Singh and Ors., [2000] 1 SCC 237 where ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 7 after contrasting the language of section 95 (1) of the 1939 Act with the provisions of section 147 (1) of the 1988 Act this Court held:-
"The result is that under the new Act an insurance policy .
covering third party risk is not required to exclude gratutious passengers in a vehicles, no matter that the vehicle is of any type or class. Hence the decisions rendered under the old Act vis-a-vis gratuitous passengers are of no avail while considering the liability of the insurance company in respect of any accident which occurred or would occur after the new of Act came into force."
20. The view expressed in Satpal Singh's case (supra) rt however, has been specifically overruled in the subsequent judgment of a Bench of three judges in New India Assurance Company v. Asha Rani and Ors., [2003] 2 SCC 223. 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's case (supra) 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 paras 25 and 27):
"25. Section 147 of 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 `good carriage'.::: Downloaded on - 19/08/2023 20:34:53 :::CIS 8
27. Furthermore, sub-clauses (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 .
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 passenger of a public service caused by or arising out of the use of the vehicle in a public place."
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21. In our view, although the observation made in Asha Rani's case (supra) were in connection with carrying passengers in a goods vehicle, the same would apply with rt 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 toward 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 gratuitous passenger." (self emphasis supplied)
18. Similarly, the Hon'ble Apex Court in New India Assurance Company Limited vs. Sadanand Mukhi and others, (2009) 2 SCC 417 has also distinguished the statutory and contractual insurance. The relevant paras 11 to15 of the judgment are reproduced as under:-
11. Provisions relating to grant of compensation occurring in Chapter XI and XII of the Act have been enacted by the Parliament in order to achieve the purpose and object stated therein. Section 146 of the Act lays down the requirements for insurance against third party risk. Where a third party risk is involved, an insurance policy is required to be mandatorily taken out. The requirements of ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 9 policies and the limits of liability, however, have been stated in Section 147 of the Act. Section 147(1)(b) of the Act, reads as under:
"147. Requirements of policies and limits of liability.--(1) In .
order to comply with the requirements of this Chapter, a policy of insurance must be a policy which-
***
(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 of respect of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
rt
(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 employee 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 (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 a conductor of the vehicle or in examining tickets on the vehicle, or
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability.
Explanation.--For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 10 vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place."
.
The provisions of the Act, therefore, provide for two types of insurance - one statutory in nature and the other contractual in nature. Whereas the insurance company is bound to compensate the owner or the driver of the motor vehicle in case any person dies or suffers injury as a result of an accident; in case involving owner of the vehicle or others are proposed to be covered, an additional premium is required to be paid for covering their life and property.
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12. It is not a case where even Section 163-A of the Act was resorted to. Respondents filed an application under Section 166 of the Act. Only an act policy was taken rt in respect of the motor vehicle. Submission of the learned counsel that being a two wheelers, the vehicle was more prone to accident and, therefore, whosoever becomes victim of an accident arising out of the use thereof would come within the purview of the term "a person" as provided for in Section 147 of the Act, in our opinion, is not correct.
13. Contract of insurance of a motor vehicle is governed by the provisions of the Insurance Act. The terms of the policy as also the quantum of the premium payable for insuring the vehicle in question depends not only upon the carrying capacity of the vehicle but also on the purpose for which the same was being used and the extent of the risk covered thereby. By taking an `act policy', the owner of a vehicle fulfils his statutory obligation as contained in Section 147 of the Act. The liability of the insurer is either statutory or contractual. If it is contractual its liability extends to the risk covered by the policy of insurance. If additional risks are sought to be covered, additional premium has to be paid. If the contention of the learned counsel is to be accepted, then to a large extent, the provisions of the Insurance Act become otiose. By reason of such an interpretation the insurer would be liable to cover risk of not only a third party but also others who would not otherwise come within the purview thereof. It is one thing to say that the life is uncertain and the same is required to be covered, but it is another thing to say that we must read a statute so as to grant relief to a person not contemplated by the Act. It is not for the court, unless a statute is found to be unconstitutional, to consider the rationality thereof. Even otherwise the provisions of the Act read with the ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 11 provisions of the Insurance Act appear to be wholly rational.
14. Only because driving of a motor vehicle may cause accident involving loss of life and property not only of a .
third party but also the owner of the vehicle and the insured vehicle itself, different provisions have been made in the Insurance Act as also the Act laying down different types of insurance policies. The amount of premium required to be paid for each of the policy is governed by the Insurance Act. A statutory regulatory authority fixes the norms and the guidelines.
15. Keeping in view the aforementioned Parliamentary of object, let us consider the fact of the present case so as to consider as to whether the insurer is liable to pay the amount of compensation in relation to the accident occurred by use of the vehicle which was being driven by the son of rt the insured. We may, for the said purpose, notice certain decisions covering different categories of the claims. In United India Insurance Co. Ltd. v. Tilak Singh, [(2006) 4 SCC 404 ] this Court considered the provisions of the Motor Vehicles Act, 1939 as also 1988 Act and inter alia opined that the insurance company would have no liability towards the injuries suffered by the deceased who was a pillion rider, as the insurance policy was a statutory policy which did not cover the gratuitous passenger."
19. Further, the Hon'ble Apex Court in National Insurance Company Limited vs. Balakrishnan and another, (2013) 1 SCC 731 had an occasion to held that the act policy stands on different footings from the comprehensive/package policy. The relevant paras 10, 11, 21, 22, 23 and 26 of the judgment are reproduced as under:-
"10. As per the command of Section 146 of the Act, the owner of a vehicle is obliged to obtain an insurance for the vehicle to cover the third party risk. Section 147 deals with the requirements of policies and limits of liability. Section 147 (1) which is relevant for the present purpose is reproduced below:-::: Downloaded on - 19/08/2023 20:34:53 :::CIS 12
"147. Requirement of policies and limits of liability. - (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which -
(a) is issued by a person who is an authorised insurer;
.
and
(b) insurers 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 of or bodily [injury to any person, including owner of the goods or his authorised representative carried in the vehicle] or of 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 rt 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 employee 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 (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 a conductor of the vehicle or in examining tickets on the vehicle or
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability.
Explanation.- For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 13 arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a .
public place."
On a scanning of the aforesaid provision, it is evident that the policy of insurance must be a policy which complies with the conditions enumerated under Section 147 (1) (a) & (b). It also provides where a policy is not required and also stipulates to cover any contractual liability.
11. In United India Insurance Co. Ltd., Shimla v. Tilak Singh of and Others[1], this Court referred to the concurring opinion rendered in a three-Judge Bench decision in New India Assurance Co. Ltd. V. Asha Rani[2] and ruled thus:-
rt "21. In our view, although the observations made in Asha Rani case 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."
It is worthy to note that in the said case the controversy related to gratuitous passenger carried in private vehicle."
21. At this stage, it is apposite to note that when the decision in Bhagyalakshmi (supra) was rendered, a decision of High Court of Delhi dealing with the view of the Tariff Advisory Committee in respect of "comprehensive/package policy" had not come into the field. We think it apt to refer to the same as it deals with certain factual position which can be of assistance. The High Court of Delhi in Yashpal Luthra and Anr. V. United India Insurance Co. Ltd. and Another[13], after recording the evidence of the competent authority of Tariff Advisory Committee (TAC) and Insurance Regulatory and Development Authority (IRDA), reproduced a circular dated 16.11.2009 issued by IRDA to CEOs of all the Insurance Companies restating the factual position relating to the liability of Insurance companies in respect of a pillion rider ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 14 on a two-wheeler and occupants in a private car under the comprehensive/package policy.
22. The relevant portion of the circular which has been reproduced by the High Court is as follows:-
.
"INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY "Ref: IRDA/NL/CIR/F&U/073/11/2009 Dated: 16.11.2009 To CEOs of all general insurance companies of Re: Liability of insurance companies in respect of occupants of a Private car and pillion rider on a two- wheeler under Standard Motor Package Policy (also called Comprehensive Policy).
rt Insurers' attention is drawn to wordings of Section (II) 1 (ii) of Standard Motor Package Policy (also called Comprehensive Policy) for private car and two-wheeler under the (erstwhile) India Motor Tariff. For convenience the relevant provisions are reproduced hereunder:- 'Section II - Liability to Third Parties (1). Subject to the limits of liabilities as laid down in the Schedule hereto the company will indemnify the insured in the event of an accident caused by or arising out of the use of the insured vehicle against all sums which the insured shall become legally liable to pay in respect of -
(i) death or bodily injury to any person including occupants carried in the vehicle (provided such occupants are not carried for hire or reward) but except so far as it is necessary to meet the requirements of Motor Vehicles Act, the Company shall not be liable where such death or injury arises out of and in the course of employment of such person by the insured.' It is further brought to the attention of insurers that the above provisions are in line with the following circulars earlier issued by the TAC on the subject:
(i) Circular M.V. No. l of 1978 - dated 18th March, 1978 (regarding occupants carried in Private Car) effective from 25th March, 1977.::: Downloaded on - 19/08/2023 20:34:53 :::CIS 15
(ii) MOT/GEN/10 dated 2nd June, 1986 (regarding pillion riders in a two-wheeler) effective from the date of the circular.
The above circulars make it clear that the insured .
liability in respect of occupant(s) carried in a private car and pillion rider carried on two-wheeler is covered under the Standard Motor Package Policy. A copy each of the above circulars is enclosed for ready reference.
The Authority vide circular No. 066/IRDA/F&U/Mar-08 dated March 26, 2008 issued under File & Use Guidelines has reiterated that pending further orders the insurers shall not vary the coverage, terms and of conditions wording, warranties, clauses and endorsements in respect of covers that were under the erstwhile tariffs. Further the Authority, vide circular No. 019/IRDA/NL/F&U/Oct-08 dated November 6, 2008 rt has mandated that insurers are not permitted to abridge the scope of standard covers available under the erstwhile tariffs beyond the options permitted in the erstwhile tariffs. All general insurers are advised to adhere to the afore-mentioned circulars and any non- compliance of the same would be viewed seriously by the Authority. This is issued with the approval of competent authority.
Sd/-
(Prabodh Chander) Executive Director"
[emphasis supplied]
23. The High Court has also reproduced a circular issued by IRD dated 3.12.2009. It is instructive to quote the same:-
"INSURANCE REGULATORY AND DEVELOPMENT AUTHRORITY REF.: IRDA IRDA/NL/CIR/F&U/078/12/2009 DATED: 3.12.2009.
TO All CEOs of All general insurance companies (except ECGC, AIC, Staff Health, Apollo) Re: Liability of insurance companies in respect of occupant of a private car and pillion rider in a two-wheeler under Standard Motor Package Policy (also called Comprehensive Policy).::: Downloaded on - 19/08/2023 20:34:53 :::CIS 16
Pursuant to the Order of the Delhi High Court dated 23.11.2009 in MAC APP No. 176/2009 in the case of Yashpal Luthra v. United India and Ors., the Authority convened a meeting on November 26, 2009 of the CEOs of all the general insurance companies doing .
motor insurance business in the presence of the counsel appearing on behalf of the Authority and the leaned amicus curie.
Based on the unanimous decision taken in the meeting by the representatives of the general insurance companies to comply with the IRDA circular dated 16th November, 2009 restating the position relating to the liability of all the general insurance companies doing motor insurance of business in respect of the occupants in a private car and pillion rider on a two wheeler under the comprehensive/package policies which was communicated to the court on the same day i.e. November rt 26, 2009 and the court was pleased to pass the order (dt. 26.11.2009) received from the Court Master, Delhi High Court, is enclosed for your ready reference and adherence. In terms of the said order and the admitted liability of all the general insurance companies doing motor insurance business in respect of the occupants in a private car and pillion rider on a two-wheeler under the comprehensive/package policies, you are advised to confirm to the Authority, strict compliance of the circular dated 16th November, 2009 and orders dt. 26.11.2009 of the High Court. Such compliance on your part would also involve:
i) withdrawing the plea against such a contest wherever taken in the cases pending before the MACT, and issue appropriate instructions to their respective lawyers and the operating officers within 7 days;
ii) with respect to all appeals pending before the High Courts on this point, issuing instructions within 7 days to the respective operating officers and the counsel to withdraw the contest on this ground which would require identification of the number of appeals pending before the High Courts (whether filed by the claimants or the insurers) on this issue within a period of 2 weeks and the contest on this ground being withdrawn within a period of four weeks thereafter;
iii) With respect to the appeals pending before the Hon'ble Apex Court, informing, within a period of 7 days, their respective advocates on record about the IRDA Circulars, ::: Downloaded on - 19/08/2023 20:34:53 :::CIS 17 for appropriate advice and action. Your attention is also drawn to the discussions in the CEOs meeting on 26.11.2009, when it was reiterated that insurers must take immediate steps to collect statistics about accident claims on the above subject through a central point of .
reference decided by them as the same has to be communicated in due course to the Honourable High Court. You are therefore advised to take up the exercise of collecting and collating the information within a period of two months to ensure necessary & effective compliance of the order of the Court. The information may be centralized with the Secretariat of the General Insurance Council and also furnished to us.
of IRDA requires a written confirmation from you on the action taken by you in this regard.
This has the approval of the Competent Authority.
rt Sd/-
(Prabodh Chander)
Executive Director"
[emphasis added]
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 the 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 the case of Bhagyalakshmi (supra) 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 the 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.::: Downloaded on - 19/08/2023 20:34:53 :::CIS 18
20. In view of the above decisions, this Court is of the view that it is now no more res-integra that the Insurance-
Company is not liable to pay compensation when a private .
vehicle met with an accident and the person travelling in the same, which is a gratuitous passenger, sustained injuries.
The policy in question, in the present case, is the act policy, as such, learned Tribunal has wrongly saddled the liability to of pay compensation on respondent No.3, in this case.
21. In view of the discussion made above, the appeal rt is allowed. The award is modified by exonerating the Insurance-Company to pay the compensation. Consequently, respondents No. 1 to 6 are jointly and severally liable to pay the amount of compensation, along-with interest, as awarded by the learned Tribunal to the petitioner. In the peculiar facts and circumstances of the case, there shall be no order as to costs.
August 19, 2023 ( Virender Singh )
(naveen) Judge
::: Downloaded on - 19/08/2023 20:34:53 :::CIS