Karnataka High Court
Oriental Insurance Co. Ltd. vs Smt. Irawwa And Others on 3 March, 1992
Equivalent citations: 1992ACJ918, AIR1992KANT321, [1995]83COMPCAS764(KAR), ILR1992KAR1592, AIR 1992 KARNATAKA 321, (1992) ILR (KANT) 1592, (1992) 3 KANT LJ 62, (1992) 2 TAC 615, (1992) 2 ACC 197, (1992) 2 ACJ 918, (1993) 76 COMCAS 830
ORDER Rama Jois, J.
1. In this appeal presented under Section 173 of the Mo'tor Vehicles Act, 1988 against an interim award made by the Motor Accidents Claims Tribunal, Belgaum, on a claim petition presented under Section 166 of the Granting compensation of Rs..25,000-00 under Section 140 of the 1988 Act in respect of death of a passenger travelling in a goods carriage together with his goods as a result of a motor accident which took place on 6-11-1990, that is, after the commencement of the 1989 Act, the following question of law arises for consideration :
Whether under an Insurance Policy taken in conformity with the requirement of Section 147 of the Motor Vehicles Act, 1988, the Insurance Company is liable to pay compensation in respect of death or bodily injury to any passenger travelling in a 'goods carriage' whether as a hirer or otherwise?
2. Brief facts of the case are these :-- One Suresh was travelling in a goods carriage bearing Registration No. MEH 5015. The goods carriage was plying from Belgaum to Bagewadi on 6-11-1990. The vehicle met with an accident at about 16-15 hours. A claim petition was presented by the wife of the deceased Suresh claiming a compensation of Rs. 3,50,000/- for the death of Suresh in the said accident. In the claim petition, the claimants also claimed interim compensation of Rs. 25,000/- payable on the ground of "No Fault Liability" under Section 140 of the Motor Vehicles Act, 1988, which corresponds to Section 92-A of the Motor Vehicles Act, 1939. As regards the liability of the Insurance Company under Section 92-A of the 1939 Act, a question of law had been referred to a Full Bench of this Court in United India Insurance Company v. Immam Aminasab Nadar, . The Full Bench of this Court, after analysing the provisions of Section 92-A of the 1939 Act, which for the first time created No Fault Liability and all the related provisions, held that in order to fix the liability on the Insurance Company in a given case, the following findings of fact must be arrived at by the Tribunal, namely, (1) The vehicle concerned was involved in the accident, and (2) The risk giving rise to the claim petition was covered by the insurance policy covering the vehicle involved in the accident.
In this case there was no dispute that the vehicle in question, namely, MEH 5015 was involved in the accident. The Tribunal while considering the prayer of relief under Section 140 of the 1988 Act, proceeded to hold that as there was insurance policy covering the vehicle on the date of accident and as the deceased was travelling in a goods vehicle as owner of the goods, the Insurance Company was liable to pay compensation of Rs. 25,000/-payable under Section 140 of the 1988 Act. In coming to the conclusion that the risk was covered by the Insurance Policy, the Tribunal followed the Division Bench Judgment of this Court in T. N. Renukappa v. Fahmida, in which this Court had held that if a person was travelling in a goods vehicle along with his goods for the carrying of which he had hired the goods vehicle, the risk arising out of the death of or injury to such a passenger would be covered by an insurance policy taken in conformity with Section 95 of the 1939 Act. According, the Tribunal made an award for Rs. 25,000/-payable under Section 140 of the 1988 Act on the ground of no Fault Liability and made both the owner of the vehicle, who is respondent-6 in the appeal as well as the appellant-Oriental Insurance Company liable to pay the said amount. Aggrieved by the said award, the appellant Insurance Company has presented this appeal.
3. The main ground urged by Sri Shankar, learned Counsel for the appellant in this appeal is that in the Full Bench decision of this Court in National Insurance Company v. Dundamma, , the Division Bench decision in Renukappa's case on which the Tribunal relied, has been and it was held that the Insurance Company was not liable to pay compensation in respect of passengers in a goods vehicle other than the employees or coolies travelling in a goods vehicle and even in respect of them the risk stands coveted only to the extent of the risk required to be covered by Section 95 of the 1939 Act, which corresponds to Section 147 of the 1988 Act. Learned Counsel pointed out that in respect of passengers travelling in a goods vehicle along with their goods, the Full Bench held that liability of the insurance company to pay compensation should be held to exist by applying the principle of Stare Decisis, as the Division Bench decision of this Court in Channappa Channaveerappa Katti v. Laxman Bhimappa Bajantri, , in which it was held that in view of Clause (ii) of the proviso to Section 95(1) of the 1939 Act, an Insurance Company was liable to pay compensation in respect of death of or bodily injury to passengers travelling in a goods vehicle along with their goods which was followed in Renukappa's case , held the field for nearly 12 years and it was not expedient to disturb the said position as the 1939 Act has since been repealed by the 1988 Act and in the corresponding Section 147 and there was no provision similar to Clause (ii) of the proviso to Section 95(1) of the 1939 Act which had lead to such an interpretation. He submitted that in view of the Full Bench decision, the appellant was not liable to pay compensation in this case as the decision was a passenger travelling in a goods vehicle, even though he was travelling with his goods and the accident took place on 6-11-1990 after the 1988 Act came into force.
4. Elaborating his contention, Sri S.P. Shankar, the learned Counsel for the Insurance Company, submitted as follows:-- The question as to whether an Insurance Company was liable to pay compensation in respect of passengers travelling in a goods vehicle even to the extent permitted by the Motor Vehicle Rules in the absence of special coverage of the risk taken by the owner of the vehicle by making extra payment of premium and whether the Division Bench decisions of this Court in Channappa and Renukappa on the point were correct, have been the subject-matter of consideration by the Full Bench of this Court in the case of Dundamma . After interpreting the provisions of Section 95 of the 1939 Act, which prescribed compulsorily the taking of insurance policies in respect of motor vehicles and limits of the liability and the provisions of Section 96 of the Act which prescribed the defences open to an Insurance Company in a claim petition presented under Section 110-A of the 1939 Act, as also Section 66 of the 1939 Act which provided that any contract restricting the liability of the owner in respect of a passengers travelling in a passenger vehicle shall be void, held that an Insurance Company was not liable to pay compensation under an 'Act only Policy' in respect of death of or bodily injury to passengers travelling in a goods vehicle. The Full Bench overruled the view taken by the Division Bench of this Court in the case of Channappa and also in Renukappa . The Full Bench, however, applied the principle of Stare Decisis and held that as the Division Bench decision of this Court in Channappa's case was being applied by this C'ourt and was being followed by the Insurance Companies for nearly 12 years and as Clause (ii) of the proviso to Section 95(l)(b) which had given rise to such an interpretation had been omitted in the corresponding provisions of the 1988 Act, the Insurance Company would continue to be liable to pay compensation in respect of persons who had engaged the goods vehicle for carrying their goods and were travelling with their goods. As far as the 1988 Act is concerned, Section 147 corresponds to Section 95, Section 149 corresponds to Section 96 and Section 92 corresponds to Section 66 of the 1939 Act and all the relevant definitions of the words such as 'transport vehicle', 'passenger vehicle', 'goods vehicle' and 'goods' are all similar under the new Act, the ratio of the decision in Dundamma's case (FB) applies on all fours to the facts of the present case, as the accident which gave rise to the claim petition before the Tribunal took place on 6-11-1990 after the 1988 Act came into force. Therefore, it cannot be said that the risk which gave rise to the claim petition was covered by the Insurance Policy covering the vehicle involved in the accident. The Insurance Company was therefore not liable to pay compensation on the count of "Fault Liability". It was also not liable to pay compensation on the basis of "No Fault Liability" incorporated in Section 140 of the 1988 Act, in view of the Full Bench decision in Aminsab Nadaf , as admittedly according to the pleadings of respondents-claimants, the deceased was travelling as passenger in a goods vehicle, albeit he was travelling with his goods after having paid freight charges and as the risk which gave rise to the claim petition was not covered by the insurance policy.
5. Coming to the facts of this case, there is no dispute that the deceased Suresh was travelling as a passenger in a goods vehicle bearing Registration No. MEH 5015 on 6-11-1990. As a result of the rash and negligent driving of the said vehicle there was an accident, at which the deceased Suresh sustained severe injuries and succumbed to the severe injuries. The 1988 Act had already come into force with effect from 1-7-1989. The question of law referred for the opinion of the Full Bench in Dundamma's case when the 1939 Act was in force, read as follows:--
"Whether by force of Clause (ii) of the proviso to Section 95(1) (b) of the Motor Vehicles Act, 1939, the Insurance Company is liable to pay compensation in respect of death or bodily injury to any person travelling in a vehicle, though it is not a vehicle constructed and adapted and meant in law for carrying passengers for hire or reward, even to the extent of number of passengers permitted to be carried in the vehicle though not for hire or reward, even in the absence of any extra coverage secured by the owner under the policy concerned in respect of such passengers?"
After considering all the relevant definitions regarding various types of vehicles and the entire scheme of the Act, with particular reference to Sections 95, 96 and 66 of the 1939 Act and applying the ratio of the decision of the Supreme Court in Pushpabai v. Ranjit, , the Full Bench held as follows :
"From the ratio of the above decision, it is clear that by virtue of the exception incorporated in clause (ii) below the proviso to Section 95(1), the compulsory coverage provided was only in respect of passengers carried for hire or reward; and in respect of any passenger carried in any vehicle not for hire or reward, no compulsory coverage is prescribed under Section 95. From this it follows that, it is only in respect of vehicles in respect of which the permit has been taken in accordance with the provisions of the Motor Vehicles Act for carrying passengers for hire or reward, Section 95 of the Act makes it obligatory to take an insurance policy which covers the risk in respect of death or bodily injury to passengers travelling in such vehicles in addition to compulsory coverage of risk as against death or injury to third parties. In respect of every other vehicle even assuming that the vehicle like a private car or an ominbus or a goods vehicle in which passengers/persons could be carried legitimately, but not for hire or reward, Section 95 of the Act does not make it obligatory on the part of the owner to take insurance policy which covers the risk in respect of persons travelling in the said vehicles. The liability of the Insurance Company in such cases arises only if the owner of the vehicle had chosen to take a policy covering the risk of the persons travelling in such vehicles, as had been the position in the case of Pushpabai (ATR 1977 SC 1735)."
XXX XXX xxx "28. For the aforesaid reason, we respectfully agree with the view taken by the Full Bench of the Gujarat High Court in New India Assurance Co. Ltd. v. Nathiben Chaturbhuj, (FB) and in the two decisions of the Madras High Court, and 1988 Ace CJ 689 (Mad) and in the Full Bench decision of the Punjab High Court, (FB) and in the decision of the Andhra Pradesh High Court, and respectfully disagree with the view taken by the Division Bench of this Court in Channappa, , Renukappa, and Gangamma (AIR 1982 Kant 261 and the view expressed in the judgments of the Allahabad, Bombay, Madhya Pradesh, Rajasthan and Kerala High Courts, referred to in paragraph G of this order.
29. The learned counsel for the claimants. however, submitted that even in the event of our taking the view that on a correct interpretation of Clause (ii) of ihe proviso, to Section 95(1)(b) of the Act, the risk in respect of passengers in a goods vehicle is not covered by, the insurance policy taken in conformity with the statutory requirement only i.e.. "Act Policy". We should apply the principle of Stare Decisis and hold that at least in respect of the owner of the vehicle travelling in a goods vehicle with his goods, the Insurance Company was liable, as that is the view prevailing in this Court for the last twelve years after the decision in Channappa's case . The learned counsel also further pointed out that the 1939 Act has since been replaced by the provisions of the 1988 Act and in the corresponding section the exception incorporated in Clause (ii) of the proviso to Section 95(l)(b) which has given rise to the controversy, has been omitted and therefore in respect of accidents occurring on and after 1-7-1989, on which date the new Act came into force, the controversy arising in these cases do not arise. The learned counsel for the Insurance Company, as stated earlier, had submitted that actually the said clause should have been deleted in the 1939 Act by the Amending Act 56/1959, when sub-clause (ii) was incorporated creating statutory liability in respect of death of or bodily injury to passengers travelling in a public service vehicle, as to some extent the two provisions overlapped each other. This fact has been taken note of by the Legislature, as is evident from non-incorporation of a similar provision in the 1988 Act. They, however, do not dispute that right from 1979 till now as far as the owner of the goods travelling in the vehicle concerned, the Insurance Companies have been required to pay and have been paying the compensation in view of the ratio of the judgment in Channappa's case .
30. In the circumstances. We are of the view that though the Question of Law referred for our opinion has to be answered in favour of the Insurance Company, there is justification to apply the principle of Stare Decisis regard ing the liability of the Insurance Company in respect of owner of goods travelling in a goods vehicle, as the said view is holding the fieid for the last nearly twelve years, and particularly in view of the replacement of the 1939 Act by the 1988 Act, in which there is no similar clause. Therefore, We restrict the answer to the passengers travelling in a foods vehicle other than the owner of the goods. In this behalf, we should also make it clear, the owner of the goods in respect of whom liability could be foisted against the Insurance Company in respect of cases arising prior to 1-7-1989 should be persons who have entered into an agreement with the owner of the vehicle for carrying goods, and the goods carried should be these as defined in S. 2(7) of the Act, and the liability shall not cover the number of persons carried in excess of what is permitted by Rule 161 of the Karnataka Motor Vehicles Rules, 1963.
31. In the result, we answer the question referred for our opinion, as follows:
Under motor vehicle insurance policy issued by an Insurance Company in conformity with Section 95 of the Motor Vehicles Act, 1939, the Insurance Company is not liable; by the force of clause (ii) of the Proviso to Section 95(l)(b) of the Act; to pay compensation in respect of death of or bodily injury to any person travelling in a vehicle which is not a vehicle constructed or adapted and meant in law for carrying passengers for hire or reward such as a goods vehicle even to the extent of number of passengers/persons permittee! to be carried in the vehicle, except in respect of the owners of the goods travelling in a goods vehicle having engaged the vehicle under an agreement with the owner for carrying goods for hire or reward, and the goods carried as those as defined in Section 2(7) of the Act, subject to the condition that such liability shall cover only up to the extent of the number of persons permitted to be carried in the goods vehicle under Rule 161 of the Karnataka Motor Vehicles Rules, 1963."
(Underlined by us) As can be seen from the above decision of the Full Bench, the entire controversy, namely, as to whether the passengers travelling in a goods vehicle were also required to be compulsorily covered by an insurance policy arose on account of Clause (ii) of the Proviso to Section 95(l)(b) of the Act and particularly for the reason that the said clause was not deleted even after the amendment of Section 95 by Act No. 56/1989, by which the risk in respect of death of or bodily injury to any passenger travelling in a public service vehicle caused by or arising out of the use of the vehicle in a public place, was expressly included in Section 95(l){b)(ii) of the 1939 Act. At this stage, it is appropriate to set out Sections 94(1) and 95(1) of the 1939 Act and Sections 146(1) and 147(1) of the 1988 Act as also the relevant definitions of the words given in the two enactments. They read :--
The 1989 Act The 1988 Act "94. NECESSITY FOR INSURANCE AGAINST THIRD PARTY RISK : --
"146. NECESSITY FOR INSURANCE AGAINST THIRD PARTY RISK :-
(1) No person shall use except as a passenger or cause or allow any other person to use a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person, or that other person, as the case may be, a policy of insurance complying with the requirements of this chapter."
(1) No person shall use, except as a passenger or cause or allow any other person to use, a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of this Chapter."
XXX XXX XXX XXX 95. REQUIREMENT OF POLICIES ANDAND LIMITS OR LIABILITY: (1) In order to comply with the. requirements of this chapter a policy of insurance must be a policy which -- "147. REQUIREMENTS OF POLICIESAND LIMITS OR LIABILITY:-- (1) In order to comply with the requirements of this Chapter, a policy of insurance must a policy which -- (a) is issued by a
person who is an authorised insurer or by a co-operative society allowed under Sec. 108 the transact the business of an insurer, and
(a) is issued by a person who is an authorised insurer; and
(b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2) --
(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.
(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,
(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 thevehicle in a public place;
Provided that a policy shall not be required --
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, in respect of the death of, or bodily injury to, any such employee:
(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
(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
(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
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) except where the vehicle is a vehicle in which passengers are carried for hire orreward or by reason of or in pursuance of a contract of employment, to cover liability in respect of the death of 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 of the event out of which a claim arises, or
(iii) to cover any contractual liability.
(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 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."
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 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."
DEFINITIONS "2(3) 'contract carriage' means a motor vehicle which carries a passenger or passengers for hire or reward under a contract expressed or implied for the use of the vehicle as a whole at or for a fixed or agreed rate or sum --
"2(7) 'contract carriage' means a motor' vehicle which carries a passenger or passengers for hire or reward and is engaged under a contract, whether expressed or implied, for the use of such vehicle as a whole for the carriage of passengers mentioned therein and entered into by a person with a holder of a permit in relation to such vehicle or any person authorised by him in this behalf on a fixed or an agreed rate or sum --
(i) on a time basis whether or not with reference to any route or distance, or
(ii) from one point to another, and in either case without stopping to pick up, or set down along the line of route passengers not included in the contract; and includes a more cab notwithstanding that the passengers may pay separate fates.
(a) on a time basis, whether or not with reference to any route or distance; or
(b) from one point to another, and in either case, without stopping to pick up or set down passengers not included in the contract anywhere during the journey, and includes --
(i) a maxicab; and
(ii) a motorcab notwithstanding that separate fares are charged for
its passengers." ''
XXX XXX
XXX XXX
"2(7) "goods" includes livestock and anything (other
than equipment ordinarily used with the vehicle) carried by a vehicle except living persons, bul does not inlcude luggage or personal effects carried in a motor car or in a trailer attached to a motor car or the personal luggage of passengers travelling in the vehicle."
"2(13) "goods" includes live-stock, and anything (other than equipment ordinarily used with the vehicle) carried by a vehicle except living persons, but does not include luggage or personal effects carried in a motor car or the personal luggage of passengers travelling in the vehicle."
"2(8) "goods vehicles" means any motor vehicle constructed or adapted for use for the carriage of goods, or any motor vehicle not so constructed or adapted when used for the carriage of goods solely or in addition to passengers.
"2(14) "goods carriage" means any motor vehicle constructed or adapted for use solely for the carriage of goods, or any motor vehicle not so constructed or adapted when used for the carriage of goods."
XXX XXX
XXX XXX
" 2(18- A) "Omnibus" means any motor vehicle
constructed or adapted to carry more than six persons excluding the
driver."
"2(29) "Omnibus" means any motor vehicle
constructed or adapted to carry
more than six persons excluding
the driver."
XXX XXX
XXX XXX
"2(22) "private Carrier" means an owner of a transport
vehicle other than a public carrier
"2(33) "Private Service Vehicle" means a motor vehicle
constructed or adapted to carry
who
uses that vehicle solely for the carriage of goods which are his property or
the carriage of which is necessary for the purposes of his business not being a business of providing transport, or who uses the vehicle for any of the purposes specified in sub-section (2) of Section 42."
more than six persons excluding the driver and ordinarily used by or on behalf of the owner of such vehicle for the purpose of carrying persons for, or in connection with, his trade or business otherwise than for hire or reward but does not include a motor vehicle used for public purposes."
XXX XXX XXX XXX "2(25) "Public Service Vehicle" means any motor vehicle used or adapted to be used for the carriage of passengers for hire or reward, and includes a motor cab, contract carriage, and stage carriage."
"2(35) "Public Service Vehicle means any motor vehicle used or adapted to be used for the carriage of passengers for hire or reward, and includes a maxicab, a motorcab, contract carriage, and stage carriage."
XXX XXX XXX XXX "2(29) "Stage Carriage" means a motor vehicle carrying or adapted to carry more than six persons excluding the driver which carrier passengers for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey."
"2(40) "Stage Carriage" means a motor vehicle constructed or adapted to carry morethan six passengers excluding the driver for hire or reward at separate fares paid by or for individual passengers, either for the whole journey or for stages of the journey."
XXX XXX XXX XXX "2(33) "Transport Vehicle" means a public service vehicle or a goods vehicle." "2(47) "Transport Vehicle" means a public service vehicle, a goods carriage, an educational institution bus or a private service vehicle."
6. On a comparison of the material provisions of the two Acts, it is seen that S. 146(1) of the 1988 Act which prescribes compulsory insurance for the use of motor vehicle in a public place is word to word similar to Section 94(1) of the 1939 Act. Section 147 of the 1988 Act which prescribes the requirements of an insurance policy in respect of a motor vehicle is similar to Section 95 of the 1939 Act, with this difference, namely, a provision similar to Clause (ii) of the proviso to Section 95 is not found in Section 147. As may be seen from the Full Bench decision in Dundamma's case the argument that the Insurance Company was liable to pay compensation for the death of or injury to passengers travelling even in a goods vehicle for hire or reward was based on Clause (ii) of the Proviso to Section 95(1) of the 1939 Act. The Full Bench on a detailed examination of all the relevant provisions of the 1939 Act held that Clause did not require the covering of liability in respect of passengers in any vehicle which in law was not meant or authorised to carry passengers for hire or reward. However, by applying the principle of Stare Decisis, the liability in respect of passengers travelling in a goods vehicle along with their goods was upheld. While doing so, the Full Bench pointed out that the question was placed beyond as far as the 1988 Act is concerned, as a provision similar to Clause (ii) of the Proviso to Section 95(l)(b) of the 1939 Act has not been included in the corresponding Section 147 of the 1988 Act. In other words, the Full Bench was clearly of the view that in the absence of such a clause in Section 147 of the 1988 Act, even the basis for the argument that an Act Policy taken in conformity with Section 147 of the 1988 Act would cover the risk in respect of passengers carried in a goods vehicle on payment of fare, whether the passenger concerned was travelling with his goods or otherwise does not exist.
7. It may be seen that S. 147 of the 1988 Act, like S. 95 of the 1939 Act, apart from prescribing the compulsory coverage in respect of third party risks, prescribes the compulsory coverage against death of or bodily injury to any passenger in a "Public Service Vehicle" caused by or arising out of the use of the vehicle in a public place. The proviso to S. 147 of the 1988 Act which is similar to the corresponding Proviso to S. 95(1) of the 1939 Act, makes it clear that compulsory coverage in respect of drivers of any motor vehicle, conductors of public service vehicles and employees carried in a goods vehicle shall be limited to the liability under the Workmen's Compensation Act. Under S. 147(2) of the Act, while the liability in respect of damage to any property of third party is limited to Rs. Six thousand as regards the liability in respect of passengers as also third parties it is made equal to the liability incurred. Section 2(35) of the 1988 Act which defines 'Public Service Vehicle' is similar to S. 2(25) of the 1939 Act and does not include a goods carriage. The difference in the definition of goods vehicle given in S. 2(8) of the 1939 Act and the 'goods carriage' given in S. 2(14) of the 1988 Act is significant. While the definition given in the 1939 Act gave an indication, goods vehicle could carry some passengers, the definition in 1988 Act omits the words "in addition to passengers" and states that goods carriage means any motor vehicle constructed or adapted for use "solely for the carriage of goods". Therefore, the question whether risk in respect of passengers carried in a goods vehicle should be covered by an insurance policy does not arise at all under the 1988 Act.
8. Rule 100 of the Karnataka Motor Vehicle Rules prescribes who could be carried in a goods vehicle. Relevant portion of it reads:--
"100. CARRIAGE OF PERSONS IN GOODS VEHICLE:-- (I) Subject to the provisions of this rule, no person shall be carried in a goods vehicle :
Provided that the owner or the hirer or a bona fide employee of the owner or the hirer of the vehicle carried free of charge or a police officer in uniform travelling on duty may be carried in a goods vehicles, the total number of persons so carried :--
(i) in light transport goods vehicle having registered laden weight less than 990 Kgs. not more than one;
(ii)in any other light transport goods vehicle not more than three; and
(iii) in any goods vehicle not more than seven.
Provided that the provisions of sub-clauses (ii) and (iii) of the above proviso shall not be applicable to the vehicles plying on inter-State routes or the vehicles carrying goods from one city to another city."
This Rule is similar to Rule 161 of the 1963 Rules framed under the 1939 Act and as held by the Full Bench in Dundamma's case , it has no bearing on the question of liability of an insurance company under an Act Policy. In respect of persons permitted to be carried in a goods carrier, other than those required to be covered under S. 147(1) and also for covering higher risk for employees, a owner of a vehicle could secure coverage of such risks by paying extra premium.
9. For the aforesaid reasons, we answer the question of law set out in the first paragraph of this order as follows:--
Under a Motor Vehicle Insurance Policy issued by an Insurance Company in conformity with S. 147 of the Motor Vehicles Act, 1988, the Insurance Company is not liable by the force of S. 147 of the Motor Vehicles Act, to pay compensation in respect cf death of or bodily injury to any person travelling in a goods carriage as passenger whether as a hirer or otherwise.
We, however, make it clear that the answer given as above does not apply to the driver and the employees carried in a goods carriage in respect of whom S. 147(1) requires compulsory coverage of the risk to the extent of liability under the Workmen's Compensation Act.
10. As far as the facts of this case are concerned, as already stated there is no dispute. The deceased was a passenger in a goods carriage, though he was travelling with his goods in the vehicle. The accident took place on 6-11-1990 after the new Act came into force. In the present case, the Insurance Policy has been produced and it is seen from the insurance policy that no extra coverage in respect of any passenger, such as owner or higher travelling in the vehicle has been taken. Therefore, the Insurance Company is not liable to pay compensation either on the ground of Fault Liability or on the ground of No Fault Liability.
11. In the result, we make the following order:--
(i) The Appeal is allowed;
(ii) The order made by the Tribunal under S. 140 of the 1988 Act is set aside only to the extent it is against the appellant-Insurance Company;
(iii) The claimants shall be entitled to enforce the order against the owner of the vehicle:
(iv) The amount deposited by the appellant Insurance Company in terms of S. 173 of the Act is permitted to be withdrawn by the appellant.
12. Petition allowed.