G. Dhyanand and Another vs Zaamni Bi and Others

Sengottuvelan, J.—One Abdul Jabbar, the husband of the first respondent and the father of respondents 2 to 7, lost his life in a fatal road,

accident about 12 O''clock midnight on 2-10-75, on the Hosur-Krishnagiri Road while he was traveling in the lorry MYD 3425 belonging to the

first appellant and insured with the second appellant. The case of the respondents 1 to 7, who are petitioners before the Motor Accidents Claims

Tribunal, in M.A.C.T.O.P. No. 20 of 1977 under S. 116-A of the Motor Vehicles Act J& as follows -

The deceased Abdul Jabbar was a sheep merchant and was aged about 50 years at the time of his death, The de ceased was travelling in the lorry

MYD 3425 from Bangalore. The lorry was driven by the 8th respon- dent, ''herein, and when the lorry was proceeding near Kurubarabelli at

about 12 O''clock m the midnight on 2-1''0-1975 due to the rash and negligent driving at high speed, the lorry capsized and Abdul Jabbar who sat

in the cabin met with instantaneous death. The accident took place on account of the rash and negligent driving of the 8th respondent here in. The

respondents 1 to 7 claimed compensation of Rs. 30,000 before the Tri bunal. The driver of the lorry remained ex parte. In the counter statement

filed by the lorry owner, who is the first appellant herein before the Tribunal, the allegation that the lorry was driven at a high speed and in a rash

and negligent manner was denied. He attributed the accident to the mechanical defect in the lorry. He also contended that the driver was directed

not to carry any passenger in the lorry and as such the driver had acted beyond the course of employment and taken the deceased passenger in the

vehicle for which the lorry owner cannot be held liable. In any event, the deceased was not a fare-paying passenger and the Insurance Company is

not liable in terms of the insurance Policy. It was also contended that the compensation claimed is excessive. In a separate counter-statement, the

Insurance company, the second appellant herein, denied the allegation that the lorry ""was insured so as to cover the liability of the deceased

passenger and the age, income and occupation of the deceased passenger were also disputed by the Insurance Company. The Insurance

Company also contended that in any event, the compensation claimed is high and exaggerated. On these pleadings, the Tribunal framed the

following Points for determination-

1, Whether the accident took place on account of the rash and negligent driving of the lorry MYD 3425 by the first respondent?

2, What is the amount of compensation to be awarded?

On behalf of the claimants the first respondent was examined as PW 1, and one C. Venkataippah an eyewitness to the accident was also

examined on behalf of the claimants to prove that the lorry was driven by the driver, the 8th respondent herein, at a high speed and in a rash and

negligent manner resulting in the death of the deceased. The claimants also filed the certified copy of the judgment in C.C. No. 164 of 1976, on the

file of the Chief Judicial Magistrate, Dharmapuri at Krishnagiri, in which the driver admitted his guilt before the criminal court and was duly

convicted and sentenced on the charge of rash and negligent driving. On this evidence, the Tribunal came to the conclusion that the accident

occurred on account of the rash and negligent driving of the lorry MYD 3425 by the driver. In the grounds of appeal the finding of the Tribunal that

the lorry was driven in a rash and negligent manner by the driver is not challenged. The main grounds taken by the appellants in this civil

miscellaneous appeal is as follows: -

The Tribunal erred in not taking note of the provisos (i), (c) and (ii) of S. 95 (1) (b), which states that there need not be any policy to cover any

liability in relation to a person carried in a goods vehicle.

The Tribunal ought to have held that the deceased being carried in the lorry was not a third party on whose behalf a claim could be preferred

against the Insurance Company.

The Tribunal ought to have held that there is no privity of contract between the claimants and the Insurance Company.

In any event, the compensation awarded is excessive.

Hence the liability of the owner of the lorry and the Insurance Company in respect of the death of a third party passenger in the lorry AM 3425

will have to be decided. In this case there is evidence to show that the deceased was the owner of the goods carried in the above said lorry.

Section 96 Of the Motor Vehicles Act dealing with the requirements of policies and the limits of liability is set out hereunder: -

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 authorised insurer or by a Co-operative Society allowed under S. 108 to transact the business an insurer; and

(b) Insures the person or, classes of persons specified in the policy to the extent specified in sub-section (2) against any liability which may be

incurred by him or them in respect of the death or bodily injury to any person 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 out of and

in the course of his employment other than a liability arising under the Workmen''s Compensation Act f923, 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 the vehicle is a vehicle in which passengers are carried for hire or reward 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.

Under proviso (1) to S. 95 of the Motor Vehicles Act a policy shall not be required to cover liability in respect of ft death of a person or a

passenger being carried in the vehicle if it is a goods vehicle except in so far as is necessary to meet the requirements In relation to a liability under

the Workmen''s Compensation Act, 1923. Rule 261 of the Madras Motor Vehicles Rules is as follows:-

No person shall be carried in the cab of the goods - vehicle beyond the number of which there is seating accommodation at the rate of 38

centimeters measured along the seat excluding the space reserved for the driver, for each Person and not more than six persons in all in addition to

the driver shall lie carried in any goods vehicle."" Relying on this rule an argument is advanced that there is no prohibition of carrying of passengers

in the cabin of the lorry within the prescribed limits. In the case reported in The Common Wealth Assurance Co. Ltd., Bombay Vs. V.P. Rahim

Khan Sahib and Others, , a single Judge of this court camp to the conclusion that in the case of passengers carried in a goods vehicle the Insurance

Company is liable to pay compensation only in respect of death or bodily injury to such passengers who are carried in the vehicle by reason of or

in pursuance of the contract of employment. A owner of goods accompanying the goods in a truck cannot be said to be traveling in the truck by

virtue of any such contract. In the case reported in South Indian Insurance Co. Ltd. Vs. P. Subramaniam and Another, to which one of us was a

party, this court came to the conclusion that in the case of a owner of the goods accompanying the goods there is no contract of employment

between the owner of the goods and the owner of the lorry. It was also held that even if it is taken that the words ''contract of employment referred

to in the second proviso to S. 95 (1) (b) would include not only the employee of the insured but also the employees of the owner of the goods, as

owner of the goods traveling in the lorry cannot be said to be doing so by reason of or in pursuance of any contract of employment for there is no

such employment as such in such a case. Taking this view the terms of the Insurance policy was held not to extend to any liability arising out of the

owner of the goods travelling in the lorry, and the Insurance company was held to be not liable to pay compensation. In the case reported in

Pushpabai Purshottam Udeshi and Others Vs. Ranjit Ginning and Pressing Co. (P) Ltd. and Another, , the Supreme Court had occasion to

consider the claim for compensation in respect of a passenger permitted to travel with the Manager of the company in the car which met with an

accident resulting in the death of the passenger. The High Court of Madhya Pradesh found that there is no evidence to show that the owner of the

vehicle was aware that the passenger was taken by the Manager and that under the circumstances the owner cannot be held liable for the tortuous

act committed by his servant The High Court found that the car was going from Nagpur to Pandhurna on the business of the company and it may

also be that the Manager of the owner''s car, was also going on the business of the owner and it may also be that he had the implied authority to

drive the vehicle. Having agreed with the contentions of the claimants, the Madhya Pradesh High Court came to the conclusion that there were no

pleading or material on record to establish that the deceased was traveling in the vehicle either on some business of the owner of the vehicle or

under any ostensible authority from them to their Manager to take the deceased as a passenger in the vehicle. A reference was made in the

judgment of Supreme Court to the observation by the Lord Justice Denning in the case reported in Young v. Edward Box and Co. Ltd., (1951) 1

TLR 789 as follows: -

.....the first question is to see whether the servant was liable, if the answer is yes, the second question is to see whether the employer must

shoulder the servant''s liability. So far as the driver is concerned, his liability depends on whether the plaintiff was on the lorry with his consent or

not the next question is how far the employers are liable for their servant''s conduct. In order to make the employer liable to the passengers it is not

sufficient that they should be liable for their servant''s negligence in driving. They must also be responsible for, his conduct in giving the man a lift. If

the servant has been for bidden, or is unauthorised, to give any one a lift, then no doubt the passenger is a trespasser on the lorry so far as the

owners are concerned; but that is not of itself an answer to the claim In my opinion, when the owner of a lorry sends his servant on a journey with

it, there by putting the servant in position not only to drive it, but also to give people a lifts in it, then he is answerable for the manner in which the

servant con ducts himself on the journey not only in the driving of it but also in giving lifts in it, provided, of course, that in so ,doing the servant is

acting in the course of his employment."".

Lord Justice Denning concluded by observing that the passenger therefore a trespasser, so far as the employers were concerned, but

nevertheless the driver was acting in the course of his employment, and that is sufficient to make the employer liable. Relying on the decision and on

the ostensible authority of the manager as a licencee to permit the deceased to travel with him, the Supreme Court held that the Endanger was

acting in the course of his employment in giving leave to the deceased to travel with him and that the owner of the vehicle is liable. In deciding the

liability of the Insurance Company, the Supreme Court after referring to S. 95 of the Motor Vehicles Act, as amended by Act 56 of 1969, held

that the insurance cover is not available to passengers in a case like the present, one and that the proviso to sub-sec. (ii) provides that a policy shall

not be required except where the vehicle is a vehicle in which passengers are carried for hire or reward or by a 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 arise-s. In the case reported in K.R. Sivagami Vs.

Mahaboob Nisa Bi and Others, , a Division Bench of this court, to which one of us was a party, in dealing with a case of a driver of a taxi carrying

more than the permitted load of Passengers which is contrary to the conditions of permit under which the vehicle was allowed to be used as a

tourist taxi, held that the non-observance of the rules relating to the number of passengers to be carried can only be said to be an improper

performance of the driver''s duty. Even assuming that the permit conditions not to take more than the permitted number of passengers is taken as a

prohibition, limitation restriction, that relates only to the manner of performance of the driver''s duties in the course of his employment and that

cannot in any way limit the sphere of his employment. Therefore, the carrying of two excess passengers by the driver of the taxi will only amount to

an improper performance of his duties as a driver of the taxi and therefore it cannot be taken to be outside the sphere of his employment and held

that the owner of the taxi is vicariously liable for the tort committed by the driver of his taxi. In United India Fire and General Insurance Co. Ltd.,

Madurai Vs. M.S. Durairaj and Others, , this Bench had occasion to consider a case where a senior clerk of the State Bank of India, Kodaikanal,

while he was returning from Madurai to Kodaikanal in a car MDA 1194, met with an accident resulting in injuries to the said clerk. In regard to the

claim for compensation by the injured clerk an objection was taken by the Insurance company that the injured was carried for hire which is against

the terms of the Insurance policy and as such the insurer was not liable. Following the judgment of the Supreme Court reported in Pushpabai

Purshottam Udeshi and Others Vs. Ranjit Ginning and Pressing Co. (P) Ltd. and Another, , referred to supra, this court negatived the liability of

the insurance company.

Adopting the principles laid down in the decisions cited above there is no difficulty in coming to the conclusion that the driver was acting in the

course of his employment in carrying the deceased and as such the owner of the lorry is liable.

But as far as Insurance Company is concerned, the terms, of the policy will have to prevail. The policy is marked as Ex. B-f. On a perusal of the

policy it is seen that it is nothing but a reproduction of the terms set out in S. 95 of the Motor Vehicles Act. Following views expressed in the

decisions referred to above interpreting similar clauses in the policy of insurance, we have no hesitation in holding that the second appellant,

Insurance Company is not liable since the liability in respect of the passenger in the lorry has been specifically excluded by the terms of the policy.

In the grounds of appeal it is also stated that the amount awarded is excessive. We have the evidence of P.W. 1, the first petitioner before the

Tribunal, to show that the deceased was doing sheep-skin business and was earning Rs. 400 per month. According to P.W. 1, he was paying her

a sum of Rs. 300 per month for family expenses. The deceased was, aged 50 years at the time of his death. On the material the Tribunal by

computing the life-span of the deceased at 65 years and on the basis the deceased could have contributed Rs. 1,200 per annum to the family

arrived at the amount of compensation at Rs. 18,000 towards the loss of support. Further a sum of Rs. 4,000 was added towards the loss of

expectation of - life. Deducting a sum of Rs. 2,000 towards uncertainties of life a sum of Rs. 20,000 was awarded as compensation. The

assessment of compensation by the Tribunal is not shown to be wrong under the circumstances of the case. Hence the plea that the quantum of

compensation awarded is excessive will have to be negative.

In view of the above discussion, the appeal in so far as the first appellant, viz., the owner of the lorry is concerned is dismissed and the appeal

by the second appellant, viz., the Oriental Fire and General Insurance Company Ltd. is allowed. However, there will be no order as to costs.

Appeal partly allowed.