Madhya Pradesh High Court
Oriental Insurance Co. Ltd. vs Smt. Radharani And Ors. on 11 August, 1997
Equivalent citations: 1999ACJ1524, AIR1999MP47, 1998(1)MPLJ645, AIR 1999 MADHYA PRADESH 47, (1998) 2 TAC 365, (1998) 1 MPLJ 645, (1999) 2 ACJ 1524
Author: Dipak Misra
Bench: Dipak Misra
JUDGMENT Dipak Mishra, J.
1. Sustainabitity of the award dated 22-7-1996, passed by the Motor Accident Claims Tribunal, Mandla in Claim Case No. 41/94 granting compensation of Rs. 2,22,667/- in favour of legal heirs of the deceased, the respondents Nos. 1 to 8 herein, is called in question by the insurer, Oriental Insurance Company Limited.
2. The factual scenario as depicted is as follows :--
On 6-5-1993 one Mohanlal boarded a jeep bearing registration No. M. P. 20-A/5692 which was coming from Mandla to Jabalpur. The jeep was driven by Hukumsingh, the respondent No. 9, and owned by Sanjay, the respondent No. 10. As put forth by the claimants the deceased had travelled in the jeep as a gratuitous passenger and was sitting in the front. The jeep was being driven in a high speed. The driver, as alleged, had exhibited rashness and gross negligence. As misfortune would have it, the vehicle deshed against an electric-pole at village Udaipur as a result of which it fell into a ditch. Mohanlal sustained injuries in the said accident and ultimately succumbed to the same. It has been set forth in the petition that Mohanlal was working in Ordinance Factory at Khamaria and was getting Rs. 2300/-towards salary and was receiving Rs. 1200/-towards bonus every year. He was 50 years of age at the time of accident. Stating all these facts the legal heirs advanced a claim of Rs. 5,53,000/-towards compensation.
3. The aforesaid claim petition was resisted by the driver on the ground that the accident had occurred due to mechanical failure and not because of rash and negligent driving. The owner of the vehicle was proceeded ex pane. The Insurance Company, non-applicant No. 3 before the Tribunal, disputed the claim of the legal representatives of the deceased on the ground that the vehicle in question was insured for the private use, but as the same was used for carrying passengers in breach of the policy, the insurer was not liable to pay any compensation. It was also pleaded by the Insurance Company that though the vehicle was registered as a public service vehicle, it was insured for private use and this aspect was concealed by the owner at the time of submitting proposal for insurance. The further stand of the said non-applicant is that the deceased was a fare paying passenger, and therefore, under no circumstance, the Insurance Company can be saddled with the liability.
4. On consideration of the materials brought on record the learned Tribunal came to hold that as there was an amendment with regards to averments in the petition pertaining to payment of fare and the said amendment having been allowed the plea of the insurer that the deceased was a fare paying passenger was of no avail. The Tribunal further recorded a finding that the accident occurred due to rash and negligent driving of the driver. The Tribunal taking into consideration the income and the age of the deceased applied multiplier 13 and, thereafter reduced it by 1/3rd and arrived at the figure 1,90,667. To this Rs. 2,000/- was added towards funeral expenses, Rs. 15,000/- towards loss of consortium and 15000/- towards loss of estate. Thus the total amount of compensation came to Rs. 2,22,667/-. Thereafter the Tribunal considering the nature, terms and conditions of the policy came to hold that Insurance Company was liable to indemnify the owner. Being of this view he directed Insurance Company to pay the awarded amount with interest at the rate of 12% per annum.
5. Assailing the aforesaid award, Mr. R.P. Agrawal learned counsel for the appellant has contended that the vehicle in question was insured for private use and the policy in question is an 'Act only Policy', and, therefore, the Tribunal has fallen into error by holding the insurer liable to pay the compensation in regard to the death of the deceased who was a passenger in the said vehicle. His further submission is that the method of computation adopted by the Tribunal is contrary to law as has been enunciated by the Apex Court in the case of General Manager, Kerala State Road Transport Corporation, Trivandrum v. Mrs. Susma Thomas AIR 1994 SC 1631 : (1994 AIR SCW 1356).
6. Mr. R. Jain learned counsel for the respondents Nos. 1 to 3 (claimants before the Tribunal) has supported the award for the reasons indicated therein. Mr. B.K. Rawat, learned counsel appearing for the respondents Nos. 9 and 10 has canvassed that the vehicle in question was registered as Light Motor Vehicle (Jeep) as defined under Section 2(21) of the Motor Vehicles Act, 1988. and therefore, the vehicle in question is to be regarded as a private car, hence there is no breach of policy by the Insured. His further submission is that the Insurance Company is liable to indemnify because of the terms and conditions of the policy.
7. On a perusal of the award we find the Tribunal has recorded a finding that the accident had occurred due to rash and negligent driving of the driver. The said finding has not been seriously questioned before us. Accordingly, we affirm the said finding.
With regard to the registration of the vehicle we notice that the Tribunal in paragraph 11 of the award has referred to Ex. P. 2, the registration certificate and has arrived at the conclusion that the vehicle was registered as 'light public service vehicle'. The tribunal has opined that the vehicle was insured under that category. We find from Ex. D.1, the cover note issued by the Insurer, it is mentioned 'private use'. In view of this position the finding of the Tribunal on this score is not tenable and accordingly we hold that the vehicle was insured as a private jeep.
8. The question that falls for consideration is whether the insurance Company is liable to indemnify in view of the fact that the vehicle has been insured as a private jeep and the policy taken by him under Ex. D. 1 is only an 'Act Only Policy'. Mr. Agrawal strenuously urged that the policy in question is an 'Act Only Policy' and does not cover the risk of the occupants or passengers who are taken gratuitously or non-gratuitously as the premium charged is Rs. 240/-. He has also pointed out that no extra premium was paid for passenger and the policy was issued only for private use and not for commercial purpose. He has drawn our attention to a policy which is called 'B' policy, namely, a comprehensive policy for private car which covert risk in respect of third parties. It is his submission that in such a comprehensive policy risk of occupant is covered if such an occupant/passen-ger is not carried for hire or reward. In absence of a comprehensive policy, submitted learned counsel for the appellant, the Insurance Company has to be exonerated.
9. At this juncture we would like to refer to the terms and conditions of the policy which has been brought on record. The policy under Ex. B. 1 is called 'A' policy for 'Act liability'. Clause (1) under the heading 'liability to the third par ties' reads as follows :
"LIABILITY TO THIRD PARTIES
1. Subject to the Limit of liability as laid down in the Motor Vehicles Act the Company, will indemnify the insured in the event of accident caused by or arising out of the use of the Motor Vehicle anywhere in India against all sums including claimant's cost and expenses which the insured shall become legally liable, to pay in respect of death of or bodily injury to any person and/or damage to any property of Third Party."
The aforesaid clause clearly states that the Insurance Company will indemnify the insured in the event of an accident against all sums. The insurer has also agreed to pay in respect of death or bodily injuries to any person and/or damages to any property of third party. The submission of Mr. Rawat is that the aforesaid clause in the policy covers a passenger's liability. To substantiate his contention he has placed reliance on the decision rendered in New India Assurance Co. Ltd. v. H. Siddaliange Naika and Ors. 1985 ACJ 89 : (AIR 1984 Kant 228). In paragraph 8 of the judgment their Lordships construing the Section 2 of the policy involved therein have held as follows at page 230 (of AIR) :--
"Adverting to the second point, in Section 2 of the Policy, it is very clearly stated that the insurer will indemnify the insured in the event of accident caused by or arising out of use of motor car, including claims, costs and expenses which the insurer which had become legally liable to pay on death or bodily injury to any person. Therefore, it is obvious that passenger's liability also is covered."
It is not mentioned whether the policy was an 'Act Only Policy' or 'Comprehensive Policy'. But on reference to a comprehensive policy which has been brought on record by Mr. Agrawal we find that aforesaid terms occur in 'B' policy. But we find the liability to third parties occurring in 'Act Only Policy' covers death or bodily injuries to any person. On a perusal of the language used in the policy which was the matter of consideration in H. Siddalinga Naika's case (supra), their Lordships interpreted that the passenger's liability is also covered.
10. At this juncture we may refer to the decision rendered by Delhi High Court in Nagar Chand Phool Chand v. Santosh Gupta and Ors., 1985 ACJ 585. wherein the Court was dealing with a comprehensive policy. After referring to the concept of 'any person' it held thus :
"The bare reading of the Insurance policy with its schedule demonstrates that while charging a sum of Rs. 540/- for a comprehensive policy, the company has undertaken to cover a risk to "any person". The clause in Section 2 referring to the liability under Section 95 is a mere repetition of the contents of Section 95 but where after reproducing Section 95 the policy speaks of the risk to "any person" it must be held that the occupants/ passengers are also covered by the policy."
It is relevant to note here that it was observed by the Court that the Insurance Company had failed to produce any material wherein a special contract was entered to cover the risk of occupants/passengers in a private car. The Court referred to instructions dated 13-3-1978 issued by the Tariff Advisory Committee. The aforesaid decision was followed by the High Court of Orissa in the case of Oriental Fire & General. Insurance Co. Ltd. v. Sanatan Pradhan and Ors. 1989 ACJ 792, and it was held that the Insurance Company was liable, to pay compensation in respect of a passenger in a jeep.
In this connection we may also refer to a decision rendered in the case of Madras Motor and General Insurance Co. Ltd. v. Katanreddi Subbareddy and Ors., 1975 ACJ 95, wherein Chinnappa Reddy J. (as His Lordship then was) held as follows :--
"The policy is what is styled as a comprehensive policy. Section 11 of the policy deals with liability to third parties. The first paragraph of Section II provides that the insurer shall indemnify the insured in the event of accident caused by or arising out of the use of the motor car against all sums which the insured shall become legally liable to pay in respect of death or bodily injury to any person. It also provides that the insurer shall not be liable where such death or injury arises out of and in the course of the employment of such person by the insured except so far as is necessary to meet the requirements of Section 95 of the Motor Vehicles Act. The expression used in the first paragraph Section 11 is 'any person' and there is no reason why the, expression should be interpreted so as, to exclude person s travelling in the car. It may be noticed that the expression 'any person' is also used in Section 93(1)(b)(i), But the second proviso to Section 95(1)(b) expressly provides that liability in respect of, death 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 need not be co,vered;by the Policy unless the vehicle is a vehicle in which passengers are carried for hire or reward. There is no similar; exclusion in the policy with which we are concerned. While adopting the language of Section 95(1)(b)(i) the Policy expressly omitted to exclude what is excluded by the proviso to that Section. I, therefore, hold that the policy is wide enough to cover liability incurred by the insured in respect of injury caused to occupants of the car."
From the ratio of the aforesaid decision we notice that the words 'any person' have been given a broad meaning. It is a cardinal rule of interpretation that words should be studied, in their context. In the case of Veerappa v. State of Mysore, AIR 1965 Mysore 227, a Full Bench of the said Court ruled that the word 'any' is a word which excludes limitatipn and qualifications and it connotes vide generalities. The Apex Court in the case pf Chief Inspector of Mines v. K. C. Thapar, AIR 1961 SC 838 while interpreting expression of 'any one of the Directors' as used in Section 76 of the Mines Act, 1952 observed that at times under certain context it would mean 'only one of the Directors, does not matter which one', but in some other context if can, cdnnpta-tively engulf of 'everyone of the Directors'.
Considering the words 'any person' in the context of the legal instrument we find that the meaning is absolutely clear and manifest, and there is no justification to give a restricted meaning to the said expression. The terms and conditions being wide enough, we are of the firm opinion, that the policy of the present nature would cover on occupant of any jeep who is carried without hire or reward.
11. The entire scenario can be looked into from another angle. In the Motor Vehicles Act, 1939 the insurer was required to cover certain categories of persons as contemplated under Section 95 of the Act. The relevant provisions of Section 95 of the Motor Vehicles Act, 1939 are reproduced below :
"95 (1). Requirements of policies and limits of liability -- (1) In order to comply with the requirements of this chapter, a policy of insurance may be a policy which -
(a) is issued by a person who is an authorised or by a co-operative society allowed under Section 108 to transact the business of an insurer, and
(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 respect of the death of or bodily injury to any person or damage to any property of a third party caused by or arising but of the use of the vehicle in a public place;
(ii) against the death of or bodily injury to any assenger of a pubfic 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 but of and in the course of his employment, of the employees of a person insured by the policy or in respect of bodily injury sustained by such an employee arising put 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 vehicle, being carried in the vehicle, or
(ii) except where me vehicle is a vehicle in which passengers are carried for hire or reward or by person of or in pursuance of a contract of employment, to cover liability in respee of the death of or bodily injury to persons being earried in or upon or entering or mounting or lighting from the vehicle at the time of the occurrence of the event out of which a claim arises, or
(iii) to cover any contractual liability."
It is worthwhile to mention here that Section 147 of the M.V. Act, 1988 does not contain the proviso (ii) of Section 95(1) of the earlier statute, Relevant provision of Section 147 before the amendment of 1994 reads as follows :
"147. Requirements of policies and limits of liability-
(i) 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 authqrised insurer; and
(b) insurer 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 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;
(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,
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability....."
From the aforesaid it is quite clear that the proviso (ii) to 95 (1) has been deleted in 1988.
By an amendment vide Motor Vehicles (Amendment) Act, 1994 the provision under Section 147(b)(i) has been amended substituting the words "Injury to any person, including owner of the goods or his authorised representatives carried in the vehicle for the words 'injury to any person'. The High Court of Orissa in the case of Divisional Manager, Oriental Insurance Company Ltd. Katak Divisional Office v. Jasoda Mohanta and Ors. (1996) 81 CIT 580 relying on the ratio of the decision rendered in the case of Laxmi Engineering Works v. P & G Industrial Institute (1995) 3 SCC 583 : (AIR 1995 SC 1428), has held that the words 'any person' before the amendment could not have been given restricted meaning and the amendment is clarificatory in nature. We have referred to the aforesaid decision to indicate that the words 'any person' is of wide amplitude and the liability accepted by the Insurance Company cannot be curtailed or restricted.
12. In this context we would hasten to refer to the Tariff Advisory Committee, report dated 1-9-1989 which has been produced by Mr. Agrawal along with a written note of submission. Mr. Agrawal has referred to private car tariff and commercial vehicle tariff as found place at page 86 of the report. The commercial vehicle tariff is totally different than that of 'private' car tariff. Mr. Agrawal has made an effort to draw a distinc-tion between the 'Act Only Policy' and comprehensive policy to indicate that the risk of occu-pant/passenger is not covered by the said policy, though a comprehensive policy covers the same. We have not been apprised at the Bar whether any extra premium is paid to cover the passenger's risk in a comprehensive policy. In absence of said stipulation in the policy, we are of the considered view that in a policy of the nature of Ex. D. 1 the passenger risk is covered.
Mr. Agrawal learned counsel for the appellant has drawn out attention to a Division Bench decision of the Kerala High Court rendered in wherein their Lordships Have distinguished the decisions rendered in the cases of N. Siddalinga Naike, Santosh Gupta, and Sanatan Pradhan (supra) on the ground that most of the cases were dealing with a comprehensive policy. The distinction has been drawn between the 'Act Only Policy' and 'Comprehensive Policy' with regard tocoverage of passenger risk. We have not been persuaded to accept the said distinction and we respectfully disagree with the said view.
13. At this juncture we may add that in a comprehensive policy extra premium is paid with regard to own damages but the limit of liability with regard to third party risk does not become unlimited. In the case of National Insurance Co. Ltd., New Delhi v. Juggal Kishore, AIR 1988 SC 719, their Lordships of the Apex Court expressed thus :
"Comprehensive insurance of the vehicle and payment of higher premium on this score, however, does not mean that the limit of the liability with regard to third party risk becomes unlimited or higher than the statutory liability fixed under Sub-section (2) of Section 95 of the Act. For this purpose a specific agreement has to be arrived at between the owner and the insurance company and separate premium has to be paid on the amount of liability undertaken by the insurance company in this behalf."
This view has been reiterated in the case of New India Assurance Co. Ltd. v. Shanti Bai, AIR 1995 SC 1113 : (1995 AIR SCW 1142).
14. Now we shall avert to the quantum of compensation. In this context we are reminded of the observation of Lord Wright in the case of Bevies v. Powell Duffray Associated Collieries Limited (1942) AC 601 (M.L.), as follows :--
"There is no question here of what may be called sentimental damages, bereavement or pain and suffering it has a hard matter of pounds, shillings and pence, subject to the element of reasonable future probabilities."
There cannot be compensation for agony and anguish, and trauma and torture, but there has to be award of 'just compensation as that is the primary requirement as ordained by law. The question that falls for consideration is whether the Tribunal has granted just compensation keeping the established and accepted norms in view. Mr. Agrawal has urged with vehemence that the Tribunal has applied multiplier of 13 though the deceased was 50 years of age and has granted Rs. 30,000/- towards consortium and loss of estate which is not permissible in law. On a perusal of the order of the Tribunal we find that he has accepted the gross income of the deceased to be 23,228,60 per year and thereafter has multiplied with 13 and deducted 1/3rd from the said sum. Considering the age of the deceased we are of the view that the multiplier of 10 would be reasonable. In normal circumstance 1/3rd has to be deducted towards personal expenses and 2/3rd is to be taken as contribution towards the dependents. Thus yearly contribution would come to Rs. 15,485/- approximately and applying multiplier of 10, the amount comes to Rs. 1,54,840/-. The funeral expense of Rs. 2000/- has to be granted. The consortium of Rs. 10,000/- is normally added to this as has been held by the Apex Court. Computing thus, the claimants are entitled to Rs. 1,66,840/-.
15. The Insurance Company shall deposit the aforesaid amount before the Tribunal with 12% interest per annum less the amount already deposited within 2 months from the date of supply of certified copy, failing which the amount shall carry interest at the rate of 15% per annum from the date of application. The order directions contained in paragraph 14 of the order of the Tribunal regarding investment of the amount in favour of the minors, remains unaltered.
16. In the result, the appeal is partly allowed and the award is modified accordingly. However, in the circumstances of the case there shall be no order as to costs.