Andhra HC (Pre-Telangana)
Dudekula Salabee vs R. Siva Sankar Reddy And Anr. on 27 June, 2007
Equivalent citations: 2008(1)ALD161
JUDGMENT D.S.R. Varma, J.
1. When Sri Kota Subba Rao and Sri Naresh Byrapaneni, learned Counsel, are requested to assist this Court, as amicus curiaes, they readily accepted.
Heard both sides.
2. This civil miscellaneous appeal is directed against the order and decree, dated 30.1.1997, passed by the Commissioner for Workmen's Compensation, Kurnool (for brevity "the competent authority under the Act"), partly allowing W.C. No. 24 of 1995 filed under the provisions of the Workmen's Compensation Act, 1923, awarding a sum of Rs. 60,502/-, as against the claim of Rs. 1,00,220/-, fastening the liability only against the first respondent therein, for the death of one Dudekula Mader Sab, during the course of his employment as Hamali.
3. Appellant is the claimant, "respondent No. 1 is the owner of tractor and trailor bearing Registration Nos.AP.21.U-186 and AP.21.U-187, respectively, and respondent No. 2 is the New India Assurance Company Limited, in the O.P., before the Court below.
4. For the sake of convenience, the appellant, respondent No. l and respondent No. 2 will be referred to as "the claimant", "the insured" and "the insurer", respectively.
5. The particulars as regards the manner in which the accident has occurred and other related aspects are not worth mentioning since the same are not in dispute.
6. The only point that arises for consideration, in this civil miscellaneous appeal, is whether the competent authority under the Act was in error in awarding a sum of Rs. 60,502/- as compensation, fastening the liability only on the insured-cum-employer of the deceased?
7. The competent authority under the Act, after adjudicating the entire issue, awarded the aforesaid compensation, fastening the entire liability only on the insured (i.e., the employer of the deceased) and dismissed the claim as against the insurer.
8. Learned Counsel for the claimant mainly contended that the competent authority under the Act went wrong in exonerating the insurer from its liability of paying the compensation and fastening the liability only against the insured. He lays much stress on Sub-clause (c) of Clause (i) of Proviso to Sub-section (1) of Section 147 f the Motor Vehicles Act, 1988 (for brevity 'the Act') and contends that no policy need be taken at all, in which case the insurer is at an obligation to pay the compensation.
Section 147 of the Act deals with the aspect of taking the policies and the limits of liability.
9. For convenience and ready reference, it is apt to extract Section 147 of the Act, which is thus:
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-
(a) is issued by a person who is an authorized 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, including owner of the goods or his authorized 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;
(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 of 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 public service vehicle engaged as a conductor of the vehicle or in examining tickets on the vehicle; or
(d) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability.
10. A perusal of Section 147 of the Act makes it abundantly clear that it is broadly divided into two aspects. It prescribes the cases in which insurance policy is required to be taken and need not be taken. Since the proviso and the clauses therein deal with a case where policy need not be taken, the learned Counsel for the claimant lays much stress on the language employed in Sub-clause (c) of Clause (i) of Proviso to Sub-section (1) of Section 147 of the Act.
11. In this context, it is to be seen that Section 146 of the Act, which deals with the necessity for insurance against the third party risks, mandates that insurance policy has to be taken. In other words, it is an imperative necessity for any owner to take a policy covering third party risks under Section 146 of the Act, whereas Section 147 of the Act deals with the requirement of policies and limits of the liability.
12. The first part i.e., Sub-section (1) of Section 147 of the Act, deals with the requirements of policies. In other words, different kinds of policies can be taken covering different contingencies, different persons, different vehicles and different risks. Further, it appears from Sub-section (1) of Section 147 of the Act that the owner has a discretion to take a policy or policies covering person or persons, in which case, basing on the nature and the terms and conditions of the policy, the premium has to be paid. It implies that unless and until premium is paid, depending upon the nature of the policy or the terms and conditions of the policy, the insurer is not under obligation to pay the compensation beyond the scope of agreement under the policy. In other words, it is not mandatory for the insured to take policy or policies covering all types of persons or all types of vehicles or risks. Though under Sub-clause (c) of Clause (i) of Proviso to Sub-section (1) of Section 147 of the Act, it is mentioned that "if it is a goods carrier being carried in a vehicle..." the policy need not be taken, I am of the view that it does not mean that the insurer is automatically liable. By necessary implication, when there is no requirement to take policy and consequently, when no policy is taken, no risk can be covered by any policy. Therefore, the language employed in Sub-clause (c) cannot be relied on nor it is useful in any manner to the claimant.
13. In this context, it is to be seen that Clause (b) of Sub-section (1) of Section 147 of the Act refers to Sub-section (2) of Section 147. Sub-section (2) of Section 147 of the Act is in the nature of exception to Clause (b) of Sub-section (1) of Section 147 of the Act.
14. A bare perusal of Sub-section (2) of Section 147 of the Act makes it obvious that the coverage of policy is limited to the extent mentioned in Clauses (a) and (b) of Sub-section (2) of Section 147 of the Act only. Therefore, it further implies that a policy has to be necessarily taken if the insured wants coverage of a class or classes of persons. In any event, there must be a contractual obligation in the shape of insurance policy and there must be a specific condition under the policy covering a person or persons like the deceased in the present case. It presupposes and as decided by the apex Court, in various judgments, a separate premium has to be paid for such a person or classes of persons and then only, the obligation of indemnification by the insurer does arise.
15. In this regard, I am fortified with the judgment of the apex Court in Ramashray Singh v. New India Assurance Co. Ltd. , wherein it was observed that an insurance policy only covers the persons or classes of persons specified in the policy and the relief was denied to the claimants therein from the insurer on the ground that there was no payment of premium for a Conductor, whose designation was actually a Kalasi
16. The said observations further make it clear that taking a policy by paying premium covering risk or risks at the discretion of the insured is permissible and the liability of the insurer is only limited to that extent as was agreed in the policy.
17. Same is the effect of the view taken by a learned Single Judge of this Court in New India Assurance Co. Limited v. Lodya Shankar .
18. Further, the apex Court, in a recent judgment, in Oriental Insurance Co. v. Meena Variyal , at Paragraph No. 20, held thus:
We are thus satisfied that based on the ratio in Swaran Singh's case , the insurance company cannot be made liable in the case on hand to pay the compensation first and to recover it from the insured, the owner of the vehicle. The deceased being an employee not covered by the Workmen's Compensation Act, of the insured, the owner of the vehicle, has not to be covered compulsorily under the Act and only by entering into of a special contract by the insured with the insurer could such a person be brought under coverage. There is no case that there is any special contract in that behalf in this case.
19. In view of the above discussion and the decisions referred to supra, I am of the considered view that the claim of the claimant against the insurer cannot be held to be valid and the competent authority under the Act, confining itself to the limitations under the Act only, was right in awarding compensation, fastening the liability only against the insured and, inasmuch as, there is no separate contractual obligation between the insured and the insurer covering the risk of the present nature, the question of liability of insurer does not arise.
For the foregoing reasons, the civil miscellaneous appeal fails and is liable to be dismissed.
20. Accordingly, the civil miscellaneous appeal is dismissed. However, there shall be no order as to costs.
This Court is beholden for the effective assistance rendered by Sri Kota Subba Rao and Sri Naresh Byrapaneni, learned Counsel, as amicus curiaes.