Case Note & Summary
The appeal was filed by the claimants, Smt. Indubai and Ku. Annapurna, against the judgment and award dated 25th June 2008 passed by the Motor Accident Claims Tribunal, Yavatmal, in MACP No. 24/2003. The Tribunal had exonerated the insurer, The National Insurance Co. Ltd., from joint and several liability to pay compensation. The victim, Bhaiyalal Dube, was travelling as a non-fare paying passenger in a truck bearing registration No. MH 29 6655, which dashed against a roadside tree and turned turtle. The truck was carrying food materials and utensils for cooking breakfast. The claimants argued that the insurance policy was comprehensive and over and above the Act, covering non-fare paying passengers, and that the insurer had charged Rs. 100 as part of basic premium towards legal liability to passengers/non-fare paying passengers. The learned advocate for the appellants cited rulings in K. Arun Kumar v. Sri Ramdass Motor Transport Ltd. (2008 ACJ 227) and Subelal v. Phulbhansha (2008 ACJ 231) to support the argument that if the policy covers non-fare paying passengers and premium is charged, the insurer is liable. The insurer, though served with notice for final disposal, remained absent. The court, after considering the submissions, allowed the appeal, holding that the insurer cannot escape liability when the policy is comprehensive and premium is charged for non-fare paying passengers. The court set aside the Tribunal's order exonerating the insurer and directed the insurer to pay the compensation awarded.
Headnote
A) Motor Accident Claims - Insurance Liability - Comprehensive Policy - Non-Fare Paying Passenger - Motor Vehicles Act, 1988, Section 147 - The court considered whether the insurer is liable to pay compensation when the policy is comprehensive and premium is charged for legal liability to passengers/non-fare paying passengers. The Tribunal had exonerated the insurer, but the High Court held that if the policy covers non-fare paying passengers and premium is charged, the insurer is liable. (Paras 1-4)
Issue of Consideration
Whether the insurer can be exonerated from liability when the policy is comprehensive and premium is charged for non-fare paying passengers, and the victim was a non-fare paying passenger in a goods vehicle.
Final Decision
The appeal is allowed. The impugned judgment and award dated 25th June 2008 passed by the Motor Accident Claims Tribunal, Yavatmal, in MACP No. 24/2003, insofar as it exonerates the insurer, is set aside. The insurer is held jointly and severally liable to pay the compensation awarded.
Law Points
- Insurance liability
- comprehensive policy
- non-fare paying passenger
- Motor Vehicles Act
- 1988
- Section 147
- premium charged
- legal liability to passengers
Case Details
2010 LawText (BOM) (08) 163
First Appeal No. 1590/2008
Mr. S.C. Bhalerao for appellants; respondents served but absent
Smt. Indubai wd/o Bhaiyalal Dube and Ku. Annapurna d/o Bhaiyalal Dube
Sanjay Kawaduji Mowale, Yashwant Baburao Rode, and The National Insurance Co. Ltd.
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Nature of Litigation
Appeal against judgment and award of Motor Accident Claims Tribunal exonerating insurer from liability to pay compensation.
Remedy Sought
Appellants sought to set aside the Tribunal's order exonerating the insurer and to hold the insurer jointly and severally liable to pay compensation.
Filing Reason
The Tribunal exonerated the insurer despite the policy being comprehensive and premium charged for non-fare paying passengers.
Previous Decisions
The Motor Accident Claims Tribunal, Yavatmal, in MACP No. 24/2003, exonerated the insurer from joint and several liability.
Issues
Whether the insurer can be exonerated when the policy is comprehensive and premium is charged for non-fare paying passengers?
Whether the victim, a non-fare paying passenger in a goods vehicle, is covered under the insurance policy?
Submissions/Arguments
Appellants argued that the insurance policy was comprehensive and over and above the Act, covering non-fare paying passengers, and that the insurer had charged Rs. 100 as premium towards legal liability to passengers/non-fare paying passengers.
Appellants cited K. Arun Kumar v. Sri Ramdass Motor Transport Ltd. (2008 ACJ 227) and Subelal v. Phulbhansha (2008 ACJ 231) to support that if policy covers non-fare paying passengers and premium is charged, insurer is liable.
Insurer remained absent despite service of notice.
Ratio Decidendi
If the insurance policy is comprehensive and premium is charged towards legal liability to passengers/non-fare paying passengers, the insurer is liable to pay compensation for a non-fare paying passenger in a goods vehicle, and cannot be exonerated.
Judgment Excerpts
The instant Appeal is directed against the judgment and award dated 25th June, 2008 passed by learned Chairman, Motor Accident Claims Tribunal, Yavatmal in MACP No. 24/2003, whereby the insurer company/ respondent No.3 herein, was exonerated from joint and several liability to pay compensation awarded to the claimants.
It is submitted that the InsurerCompany can not escape the liability for payment of compensation, particularly when the policy cover note was comprehensive and over and above the Act to cover nonfare paying passenger in the offending motor vehicle truck.
Learned Advocate for the appellant made a reference to the ruling in K Arun kumar and another vs. Sri Ramdass Motor Transport Ltd. And others : 2008 (ACJ 227) ; so also ruling in Subelal and others vs. Phulbhansha and others : 2008 ACJ 231 : 2008 ACJ 231 ( M. P. High Court) in order to canvass an argument that if Insurance policy covers nonfare paying passengers and premium is charged towards liability for nonfare paying passengers carried in the motor vehicle then insurer is liable to pay compensation.
Procedural History
The Motor Accident Claims Tribunal, Yavatmal, passed judgment and award on 25th June 2008 in MACP No. 24/2003, exonerating the insurer. The claimants appealed to the High Court of Bombay at Nagpur, which heard the appeal and delivered judgment on 3rd August 2010.
Acts & Sections
- Motor Vehicles Act, 1988: Section 147
