Rajasthan High Court - Jaipur
Abdul Shahid vs Smt. Naraini And Ors. on 2 March, 1988
Equivalent citations: II(1988)ACC259, [1989]65COMPCAS367(RAJ)
JUDGMENT Bhargava, J.
1. This is a miscellaneous appeal by the owner of a truck, against the award dated July 24, 1985, passed by the Motor Accidents Claims Tribunal, Jaipur, amounting to Rs. 1,20,000. The appeal came up for admission on October 18, 1985. Shri Rajendra Soni appeared on behalf of respondents Nos. 1 to 6 and notices were issued to respondents Nos. 7 and 8 as to why the appeal should not be admitted. It was admitted on October 29, 1985, and notices were issued to respondent No. 8. When the appeal came up for hearing, one of the points raised in this appeal was that since the goods vehicle (truck) was insured under a comprehensive policy, the whole amount awarded as damages by the Tribunal should be recoverable from and payable by the insurance company, and reliance was placed on Smt. Chand Kanwar v. Mannaram, AIR 1986 Raj 2; [1988] 63 Comp Cas 721 (Raj). Learned counsel for the insurance company submitted that he had already filed an appeal against the said judgment which is still pending for service but since the point involved was very important and it was likely to arise in other cases, the case was referred to a larger Bench for an authoritative pronouncement. Thereafter, the Hon'ble Chief Justice constituted the Full Bench.
2. Truck No. R.J.G. 3277, which was being driven by Abdul Shakoor, respondent No. 7, met with an accident on April 15, 1982, as a result whereof Daula Ram died. The legal representatives and dependants Nos. 1 to 6 of Daularam filed a claim petition before the Motor Accidents Claims Tribunal, Jaipur, claiming an amount of Rs. 3,22,000. The insurance company in reply submitted that it was responsible only to the tune of Rs. 50,000. The owner and the driver of the truck also contested the claim. The Tribunal, after recording evidence, came to the conclusion that Daularam died on account of rash and negligent driving by the driver, Abdul Shakoor, respondent No. 7, and that the claimants were entitled to a compensation of Rs. 1,20,000 in all. The Tribunal further held that the insurance company, respondent No. 8, is responsible only to the extent of Rs. 50,000 and interest thereon, and the remaining amount of claim would be recoverable from the owner of the truck and the driver. It is against this award that the present appeal has been filed by the owner of the truck.
3. Learned counsel for the appellant has placed reliance on a decision of this court in Smt. Chand Kanwar v. Mannaram, AIR 1986 Raj 2; [1988] 63 Comp Cas 721 (Raj) wherein the learned single judge, relying on a decision of the Andhra Pradesh High Court in Srisailam Devasthanam v. Bhavani Prameelamma, AIR 1983 AP 297; [1983] ACJ 580; [1985] 58 Comp Cas 816 (AP) and also two judgments of the Madras High Court in Rajeswari Transports (Firm), Theni v. M.G. Rajan [1982] ACJ (Suppl.) 118 ; [1982] 1 MLJ 248, and Oriental Fire and General Insurance Co. Ltd. v. V. Ganapathi Ramalingam, AIR 1981 Mad 299; [1982] ACJ (Suppl.) 106, and keeping in mind the observations of Justice V.R. Krishna Iyer in Gujarat Steel Tubes v. Gujarat Steel Tubes Mazdoor Sabha, AIR 1980 SC 1896, held that the liability of the insurance company would extend to the limit of the award given by the Tribunal and since the vehicle was insured comprehensively, the whole amount awarded as compensation is recoverable from and payable by the insurance company.
4. Learned counsel for the appellant also placed reliance on New Asiatic Insurance Co. Ltd. v. Pessumal Dhanatnal Aswani, AIR 1964 SC 1736 ; [1964] 34 Comp Cas 693 (SC), Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan, AIR 1987 SC 1184; [1987] 62 Comp Cas 138 (SC) and Sheikhupura Transport Co. Ltd. v. Northern India Transporters Insurance Co. Ltd., AIR 1971 SC 1624.
5. On the other hand, learned counsel for the insurance company has placed reliance on Kanan Bordotoi v. Balwant Rai Mukkar [1984] ACJ 469 (Gauhati) wherein the Gauhati High Court has held that the insurer is liable to pay only a limited amount of Rs. 50,000 and no more.
6. Great reliance has been placed by the respondent on a Division Bench judgment of this court in Sohan Lal v. Bal Swaroop Bal Bhatnagar [1987] ACJ 113, wherein their Lordships have held that merely because the insurance policy is stated to be a comprehensive policy, it cannot be said that the insurance company has agreed to indemnify the owner to an unlimited extent because this term is used only in distinction with third party risk, and, in that case, since there was no clause under the insurance policy for the unlimited liability of the insurer, the insurance company was not liable to pay the whole amount of the award but only to the extent of Rs. 50,000.
7. Our attention was also drawn by learned counsel for the respondent to another decision of this court by a single judge in Kota Sand Co. v. Santosh Talwar [1985] ACJ 98 as also another decision of this court in Sampat Lal v. Geeta Devi [1984] RLR 1052, but none of these two cases has any relevancy because there is no discussion on the point which is involved in the case at hand because in Santosh Talwar's case [1985] ACJ 98, the insurance policy was not produced and Sampat Lal's case [1984] RLR 1052 was not a case of a comprehensive policy.
8. Our attention was also drawn to an earlier Full Bench decision of this court in Vimla Srivastava v. Rajnidevi Sharma [1986] ACJ 922 ; [1988] 64 Comp Cas 613 (Raj) [FB] but in that case also, we do not find any discussion about the point involved in this case and, therefore, it is also of no assistance to us.
9. Reliance was also placed by the appellant on a recent decision of this court in Smt. Darshani Devi v. Shri Sheo Ram [1989] 65 Comp Cas 353 wherein the learned single judge, referring to his earlier judgment in Smt. Chand Kanwar, AIR 1986 Raj 2; [1988] 63 Comp Cas 721 (Raj) held that the liability of the insurance company is unlimited. In that case, learned counsel for the insurance company submitted that the Division Bench of this court in Sohan Lal's case [1987] ACJ 113 held that the interpretation of the comprehensive policy by the single judge in Chand Kanwar's case, AIR 1986 Raj 2; [1988] 63 Comp Cas 721 (Raj) is not correct. The Hon'ble Justice G.M. Lodha, after discussing both these cases, observed that Chand Kanwar's case, AIR 1986 Raj 2 ; [1988] 63 Comp Cas 721 (Raj) has not been overruled, and it had not been declared no longer good law by the Division Bench and that the observations made by the Division Bench were in the nature of obiter dicta only. It was further mentioned that it will be for a larger Bench in a proper case to consider whether the observations made in this respect are correct or not, so that the clouds which have gathered on the horizon are cleared and no confusion is left. We shall be adverting towards this aspect a little later.
10. Our attention was also drawn to a decision of the Gujarat High Court in Bomanji Rustomji Ginwala v. Ibrahim Vali Master [1982] ACJ 380 where, after considering an earlier decision of the Gujarat High Court, it was observed that the insurance company can cover a wider risk by contract other than the statutory limit of Rs. 2,000 and it will depend on the facts of each case and on the basis of the terms of the insurance policy.
11. Our attention has also been drawn to Narcinva V. Kamat v. Alfredo Antonio Doe Martino [1985] 58 Comp Cas 383; [1985] ACJ 397, wherein the Supreme Court has observed that if the insurance company fails to prove that there was a breach of the terms of contract of insurance as evidenced by the policy of insurance, its liability under the contract of insurance remains intact and unhampered and it was bound to satisfy the award under the comprehensive policy of insurance. In this case also, there is no discussion on the question involved in the present case.
12. Our attention was also drawn to a Division Bench decision of the Gujarat High Court in British India Insurance Co. Ltd. v. Minor Khagesh Devendra Prasad Jani [1977] ACJ 416 wherein the whole liability of the award was fastened on the insurance company. In this case also, there is no discussion about the point in issue before us.
13. Reliance was also placed on a Division Bench decision of the Calcutta High Court in National Insurance Co. Ltd. v. Mahadev [1986] ACJ 362 wherein their Lordships have observed as under (at p. 365):
" When under an insurance policy, the liability of the insurer was not limited to the requirements of Section 95(1) of the said Act, then the insurer's extent of liability would be governed by the terms of the particular policy. Only in the absence of a contract to the contrary, the measure of the liability of the insurer would be ascertained with reference to Section 95(2) of the Motor Vehicles Act. An insurance company may, however, issue a comprehensive policy and agree to cover all risks, and in that event, its liability would be more extensive than contemplated by Section 95 of the Motor Vehicles Act. The extent of the insurer's liability in each case would be determined with reference to the terms of the particular policy."
14. Our attention was also drawn to a decision of the Delhi High Court in Mahinder Singh v. Manju Sawhney [1986] ACJ 446 wherein it has been held that since the insurance policy was not proved in accordance with law, the liability of the insurance company was unlimited. This case also does not throw any light on the question involved before us.
15. Reliance was also placed by learned counsel for the insurance company on a decision of the Madhya Pradesh High Court in New India Insurance Co. Ltd. v. M.P.S.R.T. Corporation [1986] ACJ 1144; [1988] 64 Comp Cas 309 ; wherein it has been observed that as regards the liability of the insurer in case of damage to property, the insurer was held liable to the extent of Rs. 2,000 only as per the provisions of Section 95(2)(d) and terms of policy, i.e., such amount as is necessary to meet the requirements of the Motor Vehicles Act, 1939, and the owner was held liable to pay the balance. In this case also, we do not find any discussion regarding the question before us.
16. Our attention was also drawn to the recent decision of the Supreme Court in M.K. Kunhimohammed v. P.A. Ahmedkutty [1987] ACJ 872; [1988] 64 Comp Cas 7 wherein their lordships of the Supreme Court have proposed some suggestions to the Central Government in respect of certain provisions of the Motor Vehicles Bill then pending before Parliament but that also does not relate to the question before us.
17. Learned counsel for the insurance company has submitted that there are three types of policies--(i) Act policy, i.e., a policy only to comply with the provisions of Section 94 of the Act of 1939 which provides that no person shall use a motor vehicle in a public place unless there is in force in relation to the use of the vehicle, a policy of insurance, complying with the requirements of the Motor Vehicles Act; the second one is the third party policy as per Section 95(2)(d) of the Motor Vehicles Act and the third one is the comprehensive policy. The Act policy fulfils only the requirement of law, i.e., the obligation under Section 94 of the Act, whereas, in the third party policy, the limits of the liability are fixed and in case of a comprehensive policy, the insurance company is liable to indemnify the insured against loss or damage of the motor vehicle and its accessories. Even if the vehicle is insured comprehensive, it does not mean that the insurance company is liable to indemnify the insured against the total award beyond the limits of the liability mentioned in the insurance policy or in terms of Section 95 of the Motor Vehicles Act. We requested learned counsel for the insurance company to produce before us some evidence, literature, instructions or books in support of his contention as to the meaning of the three types of policies, especially the comprehensive policy, but no such documentary evidence like some journal, books, instructions, literature has been produced before us by learned counsel for the insurance company. Therefore, it is very difficult to accept his contention. The insurance company must be having some literature to canvass to its clients as to why they should go in for a comprehensive policy. What is the difference between a comprehensive policy and a policy under the Act or for covering third party risk? No oral evidence has been led on this point by either party as this was never in issue at the stage of trial before the Tribunal as is obvious by going through the points which have been framed by the Tribunal for the purpose of a decision in the judgment, nor is there any discussion on this point in the award of the Tribunal. It is barely mentioned that since, as per the terms of the insurance policy, the limited liability was to the tune of Rs. 50,000, the insurance company is liable to pay only a sum of Rs. 50,000. Even in the reply to the claim petition filed on behalf of the insurance company, this aspect of the matter, involving the impact of the policy being comprehensive, has not been asserted. No oral evidence was led by the insurance company nor have any documents been produced and, therefore, we are left only with the insurance policy as such. The heading of the policy reads as under:
" Commercial Vehicles Comprehensive (India)".
18. The printed terms of the policy are divided into two sections--(i) Loss or damage and the other liability to third parties. With regard to Section 1 it has been stated that the company will indemnify the insured against loss or damage to the motor vehicle and/or its accessories whilst thereon ;
(a) by accidental extraordinary......
whereas with regard to Section 2, liability to third parties, it has been stated that " subject to the limits of liability, the company will indemnify the insured against all sums including the claims, costs and expenses which the insured shall become legally entitled to pay in respect of-
(i) death or bodily injury to any person caused by or arising out of the use of the motor vehicle;
(ii) damage to property caused by the use of the motor vehicle.
19. Then, it also contains some provisos which are not very relevant for discussion in the present case. It also provides some general exceptions which are also not relevant for the purpose of deciding the issue before us.
20. When we look at the Schedule attached to the policy which gives the names of the insured, vehicle No, particulars of the vehicle, etc., there, is a mention of limits of liability. On the back portion of the Schedule, there are some conditions printed but they also do not help us in deciding the point in issue before us.
21. In this view of the matter, we do not get any assistance either by going through the insurance policy or by the evidence on record. The word "comprensive " has not been defined in the Motor Vehicles Act. The dictionary meaning of the word "comprehensive " is as under :
As given in The Random House Dictionary of the English Language, College Edition, 1977 Reprint, at page 276 " ' Comprehensive'--..... 3. Insurance covering or providing broad protection against loss."
The meaning of the word " Comprehensive " as given in Corpus Juris Secundum, 15A, part page 166, is as under:
" Comprehensive'--The word ' Comprehensive is defined as meaning including much ; comprising many things; having a wide scope, inclusive, having the power to comprehend many things; of wide mental grasp, intensive. The term is not superlative in significance.
'Comprehensive' has been held to be synonymous with 'compendious ',' extensive ', ' full', ' large', and ' wide' and has been held to be the antonym of ' circumscribed ', ' limited', ' narrow' and restricted."
22. In the absence of any evidence, oral or documentary, by either party, we have to interpret the meaning of the two clauses mentioned in the insurance policy. The insurance policy claims to be a commercial vehicle comprehensive policy. In the policy, Section II of its terms has the heading LIABILITY TO THIRD PARTIES, which reads as under :
" 1. Subject to the limits of liability, the company will indemnify the insured against all sums including claimant's costs and expenses which the insured shall become legally liable to pay in respect of
(i) death of, or bodily injury to, any person caused by or arising out of the use (including the loading and/or unloading) of the motor vehicle.
(ii) damage to property caused by the use (including the loading and/or unloading) of the motor vehicle....... "
23. It appaars that this provision in the policy is based on Section 95 of the Motor Vehicles Act, 1939, which runs as under :
"95. Requirements of policies and limits of liability,--In order to comply with the requirements of this Chapter, a policy of insurance may 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 respect of the 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;......"
24. The Schedule attached to the policy, under the heading LIMITS OF LIABILITY, provides as under :
" Limit of the amount of the company's liability under Section II-1(i) in respect of any one accident; Such amount as is necessay to meet the requirements of the Motor Vehicles Act, 1939.
Limit of the amount of the company's liability under Section II-1(ii) in respect of any one claim or series of claims arising out of one event: Rs. 50,000."
25. In this limit of liability, Section II-1(i) and (ii) relate to the conditions of the insurance quoted above. After reading all these together and taking their overall meaning and the fact that this is a comprehensive policy, we have to interpret the meaning of the words "such amount as is necessary to meet the requirements of the Motor Vehicles Act ". Though there is no evidence as to what is the premium payable for an ordinary policy like an Act policy or a third party policy and for a comprehensive policy, as no literature in this regard has been produced in spite of our requests to learned counsel for the insurance company, we take it that the premium for a comprehensive policy is higher than that for the other two policies. Even if there are two possible interpretations of this phrase, we have to opt and select the one which goes a step further to fulfil the objects of these provisions which would have been in the mind of the Legislature.
26. Chapter VIII of the Motor Vehicles Act deals with " Insurance of Motor Vehicles against third party risks ", that is to say, it is a provision to ensure that third parties, who suffer on account of the user of the motor vehicles, would be able to get damages for injuries suffered and that the recoverability of the damages will not be dependent on the financial condition of the driver or the owner of the vehicle. Section 94 of the Act prohibits, as a matter of necessity, for insurance against third party risk, the use of a motor vehicle by any person unless there exists a policy of insurance in relation to the use of the vehicle by that particular person, complying with the requirements of Chapter VIII. The policy must, therefore, provide insurance against any liability to third party incurred by that person when using that vehicle. The policy should, therefore, be with respect to that particular vehicle. It may, however, mention the person specifically or generally by specifying the class to which that person may belong, as it may not be possible to name specifically all the persons who may have to use the vehicle with the permission of the person owning the vehicle and effecting the policy. The policy of insurance contemplated by Section 94, therefore, must be a policy by which a particular vehicle is insured.
27. Section 95 of the Act lays down the requirements which are to be complied with by the policy of insurance issued in relation to the use of a particular vehicle. They are : (1) the policy must specify the person or classes of persons who are insured with respect to their liability to third parties; (2) the policy must specify the extent of liability which must extend to the extent specified in Sub-section (2); and (3) the liability which may be incurred by the specified person or classes of persons in respect of death or bodily enjury to any person caused by or arising out of the use of the vehicle insured in a public place.
28. Sub-section (4) of Section 95 requires the issue of a certificate of insurance, in the prescribed form, to the person who effects the policy. The form of the certificate prescribed by the Motor Vehicles Third Party Insurance Rules, 1946, requires the specification of persons or classes of persons entitled to drive. The authorised insurer is also to certify in the certificate that the policy to which the certificate relates, as well as the certificate of insurance, are issued in accordance with the provisions of Chapter VIII of the Act of 1939.
29. Sub-section (5) of Section 95 makes the insurer liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons. If the policy covers the insured for his liability to third parties, the insurer is bound to indemnify the person or classes of persons specified in the policy.
30. The Supreme Court in New Asiatic Insurance Co., AIR 1964 SC 1736 ; [1964] 34 Comp Cas 693, has observed that "once the company had undertaken liability to third parties incurred by the person specified in the policy, the third party's right to recover any amount under or by virtue of the provisions of the Act, is not affected by any condition in the policy. Considering this aspect of the terms of the policy, it is reasonable to conclude that proviso (a) of para. 3 of Section II (in that case) is a mere condition affecting the rights of the insured who effected the policy and the person to whom the cover of the policy was extended by the company and does not come in the way of third parties' claims against the company.
31. In this era of social justice, we cannot ignore the observations of Justice Krishna Iyer (as he then was) in a number of decisions, appealing to the judges to have an edge of baneficial interpretation for the have-nots and innocent persons which are based on the clarion call of the father of the nation, Mahatma Gandhi, quoted by Justice Krishna Iyer in Gujarat Steel Tubes Ltd. v. Gujarat Steel Tubes Mazdoor Sangh, AIR 1980 SC 1896, 1932: " whenever you are in doubt.....apply the following test Recall the face of the poorest and weakest man whom you may have seen and ask yourself, if the step you contemplate is going to be of any use to him."
32. Keeping these observations in mind, the object and purpose of getting the motor vehicle insured and looking to the classes mentioned in the insurance policy based on Section 95 of the Act, and specially when there is no evidence or any document or literature to throw any light as to the impact of a comprehensive policy, and in the absence of any evidence, keeping in mind the dictionary meaning of the word " comprehensive " and, as stated in the Corpus Juris Secundum, Part 15A, page 166, we are of the view that the interpretation taken by the learned single judge (Justice G.M. Lodha, as he then was), seems to be fully justified and we hereby confirm the same. We need not repeat his observations which are based on Srisailam Devasthanam, AIR 1983 AP 297; [1983] ACJ 580; [1985] 58 Comp Cas 816 (AP) and Rajeshwari Transport's case [1982] ACJ (Suppl.) 118 ; [1982] 1 MLJ 248, which get support from the observations of the Supreme Court in New Asiatic Insurance Co. AIR 1964 SC 1736 ; [1964] 34 Comp Cas 693 (SC) and Sheikhupura Transport Co., AIR 1971 SC 1624. We respectfully disagree with the observations of the Gauhati High Court in Kanan Bordoloi [1984] ALJ 469, and other cases in which the view similar to that in Kanan Bordoloi [1984] ACJ 469 (Gauhati) has been taken. We are not convinced by the views expressed by the Division Bench in Sohan Lal's case [1987] ACJ 113, interpreting the decision in Chand Kanwar, AIR 1986 Raj 2; [1988] 63 Comp Cas 721, more so because they are in the nature of obiter dicta only, as in that case, this point was never agitated at any earlier stage. It was for the first time in the High Court only because of the decision in Chand Kanwar's case, AIR 1986 Raj 2; [1988] 63 Comp Cas 721, that this argument had been put forth.
33. As and when, in some other case, the insurance company adduces or produces come tangible evidence, oral or documentary, stating the impact of a comprehensive policy or distinguishing it from an Act policy or third party policy, it will be open for the courts to decide that case in the light of evidence adduced or produced by the parties. We are really very sorry to observe that in spite of our repeated requests to learned counsel for the insurance company, no such material was placed before us and, therefore, we were left with interpreting the terms of the insurance policy as they existed, in the light of the decisions we have quoted above.
34. In the result, we allow this appeal and hold that the insurance company is liable to pay to the claimants, the whole amount of the award passed by the Motor Accidents Claims Tribunal. Costs easy.