New India Assurance Co. Ltd. vs Veena Devi and Others

Surjit Singh, J.—Appellant New India Assurance Co. Ltd. is aggrieved by the award dated 14.9.1998 of Motor Accidents Claims Tribunal, Rampur Bushahr, whereby liability for payment of compensation awarded to respondents Veena Devi and others, the dependants of deceased Devku Devi, who died in an accident of a truck, has been imposed upon it (the appellant) on account of its being the insurer.

Appellant''s plea is that the deceased was a gratuitous passenger on board the truck and this fact is borne out from the evidence and the pleadings and, therefore, the liability could not have been imposed upon it.

I have heard the learned counsel for the parties and perused the record.

The learned Tribunal has rejected the plea of the appellant for two reasons. First the deceased, even if a gratuitous passenger, was a third party and hence her risk was covered by the policy. Reliance was placed by the learned Tribunal on a Full Bench decision of Gauhati High Court in New India Assurance Co. Ltd. v. Satyanath Hazarika 1989 ACJ 685 (Gauhati) and a Division Bench judgment of our own High Court in New India Assurance Co. Ltd. Vs. Lachhmi Devi and Others, The second reason recorded by the learned Tribunal for rejecting the appellant''s plea is that the deceased had paid Rs. 15 as hire charges and so she could not be said to be a gratuitous passenger.

As regards the first reason given by the Tribunal in support of the finding that insurer is liable to pay the compensation, the same cannot be endorsed. The precedents relied upon by learned Tribunal are no longer a good law. Hon''ble Apex Court in New India Assurance Co. Ltd. Vs. Asha Rani and Others, and Oriental Insurance Company Ltd. Vs. Devireddy Konda Reddy and Others etc. etc. and Jogi Subbamma and Others etc. etc., has authoritatively held that Section 147 of the Motor Vehicles Act, 1988 does not enjoin any obligation on the owner of the vehicle to get his vehicle insured for the risk of any passenger travelling in a goods carriage and the insurer will have no liability therefor.

So far as the second reason is concerned, same appears to be well founded. A reading of the insurance policy, Exh. RD, tendered in evidence by the appellant itself shows that it covered the risk of the deceased. Section II of the policy pertaining to liability of third parties, inter alia, contains the following clause:

Except so far as is necessary to meet the requirements of the Motor Vehicles Act, the company shall not be liable in respect of death and/or bodily injury to any person who is not employee of the insured and not being carried for hire or reward, other than owner of the goods or representative of the owner of the goods, being carried in or upon entering or mounting or alighting from the motor vehicle described in the Schedule of this policy.

A reading of the above reproduced clause shows that the liability of the insurer is excluded only in the case of a passenger, who is not an employee of the insured and is not being carried for hire or reward. In the present case, the deceased as per averments in para 10 of the petition had paid Rs. 15 as hire charges for travelling by the truck, in question. The appellant did not lead any evidence in support of the allegation that the deceased was on board the truck as gratuitous passenger, in spite of the fact that the petitioner categorically alleged in para 10 of their petition that the deceased had paid Rs. 15, on account of hire charges, for travelling by the truck.

The learned counsel for the appellant urged that in view of the law laid down by Apex Court in New India Assurance Co. Ltd. Vs. Asha Rani and Others, and Oriental Insurance Company Ltd. Vs. Devireddy Konda Reddy and Others etc. etc. and Jogi Subbamma and Others etc. etc., , the insurance company is not required to pay the compensation. The argument has been stated only to be rejected. It is true that Section 147 of the Motor Vehicles Act does not require that the risk of the passenger, being carried in a goods carrier, should be covered by the insurance policy, but there is nothing in the Motor Vehicles Act prohibiting the insurer to cover such a risk. By a contract between the insurer and the insured, i.e., owner of the vehicle, any risk can be covered besides those statutorily required to be covered.

For the reasons recorded in the preceding para, it cannot be said that the deceased was a gratuitous passenger or the risk of her death was not covered by the insurance policy. Consequently, the appeal is dismissed.