Holding

The appeal under Section 173 is maintainable, but the insurance company is not liable to pay compensation to labourers travelling in trolleys attached to tractors.

Summary

Labourers travelling in trolleys attached to tractors were injured in motor accidents and claimed compensation under the Motor Vehicles Act, 1988. The Motor Accident Claims Tribunal awarded compensation, rejecting the insurer's claim that it was not liable and that the tractor owner alone was responsible. The insurer appealed the award under Section 173 and also filed writ petitions during execution proceedings, which the High Court dismissed, holding the appeal non‑maintainable. The Supreme Court examined (i) the maintainability of a Section 173 appeal and (ii) the insurer's liability for compensation to trolley passengers, relying on earlier decisions. It held that the appeal is maintainable but the insurer is not liable for such compensation, directing the High Court to reconsider the matters in light of the cited precedents. The appeals were disposed of and remitted to the High Court without any order as to costs.

Issues considered

Whether an appeal under Section 173 of the Motor Vehicles Act, 1988 is maintainable when a writ petition is filed during execution proceedings.
Whether the insurance company is liable to pay compensation to persons travelling in a trolley attached to a tractor under the Motor Vehicles Act, 1988.

Legislation cited

Motor Vehicles Act, 1988s. 140, s. 168, s. 173, s. 174

Subjects

Motor Vehicles ActSection 173 appealinsurance liabilitymotor accident compensationtrolley attached to tractorMotor Accident Claims Tribunalwrit petitionexecution proceedings

Judgment

i
A UNITED INDIA INSURANCE CO. LTD.
V.
SE1'.JERAO AND ORS.

NOVEMBER 14, 2007
B
[DR. ARinT PASAYAT AND P. SATHASIVAM,JJ.) ·-
Motor Vehicles Act, 1988-ss. 140and173-Motor accident-
Injury to persons travelling in Trolly attached to Tractor-Claim for
c compensation-Granted by Tribunalfixing the liability to pay, on the ...
Insurance Compan~Appeal ofInsurance Company u/s 173-During
pendency thereof, execution proceedings-Writ Petition by insurance
Company dismissed-On appeal, held: The issues regarding
maintainability ofappeal u/s 173 and regarding liability ofinsurance
D Company to pay compensation in such case, covered by judgments of ...(

Supreme Court-Matter remitted to decide the case in accordance
therewith.
Persons traveling in a Trolly attached to a Tractor, suffered
injuries in a motor accident. They claimed compensation. Tribunal
E -passed the award rejecting the plea of the Insurance Company that
it was not liable to pay compensation in such case, as it was the
liability of the owner of the Tractor. While appeal of Insurance
j'
Company was pending before High Court, execution proceedings
were initiated. Therefore the Company filed a Writ Petition, but the
F same was dismissed. Hence the present appeals. A_

Disposing of the appeals and remitting them to High Court, the
Court
HELD: The issues regarding maintainability of the appeal in
G terms of Section 173 of Motor Vehicles Act, 1988 and regarding
liability oflnsurance Company to pay compensation to the labourers
travelling in trollics, since have been decided by this Court, appeals
arc remitted to High Court to consider the matters in the light of

1150
H
UNITEDINDIAINSURANCECO.LTD. v. SERJERAO 1151
[PASAYAT,J.]
those judgments. [Paras 6.and 8] [1152-C, D; 1153-E, F] A
Smt. Yellawwa and Ors. v. Nationallnsurance Co. Ltd. andAnr.,
(2007) 8 SCALE 77 and Oriental Insurance Company Ltd. v. Brij'
Mohan and Ors., (2007) 7 SCALE 753, relied on.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5201 B
of2007.
From the final Judgment and Order dated 20.4.2004 of the High'
Coutt of Judicature of Bombay, Aurangabad Bench at Aurangabad in
Writ Petition No. 4187 of2003.
WITH
c
C.A. Nos. 5202-5205, 5207 & 5208 of 2007.
Sudhir Kumar Gupta for the Appellant.
The Judgment of the Court was delivered by D
DR. ARIJIT PASAYAT, J. 1. Leave granted.
2. Challenge in these appeals is to the order passed by a learned
Single Judge of the Bombay High Court, Aurangabad Bench dismissing
the writ petitions filed by the appellant (described hereinafter as 'the E
Insurance Company'). The controversy lies within a very narrow compass.
3. The respondents were travelling in the Trolly attached to a Tractor ,
as labourers. They claimed to have suffered injuries because the Tractor
with the Trolly in each case met with an accident. Petitions claiming
compensation under the Motor Vehicles Act, 1988 (in short 'the Act') F
were filed along with application under Section 140 of the Act. Order
was passed by the learned Additional District Judge and Ex-officio ·
Member, Motor Accident Claims Tribunal, Latur (in short 'the MACT)
on the principle of no fault liability. The Insurance Company took the stand ·
that it had no liability in respect of the persons travelling in the Trolly and iG
.1, the owner of the Tractor is liable to pay compensation. This plea was
rejected by the MACT. Appeal in tenns of Section 173 of the Act in ,
each case was preferred before the High Court. Learned Single Judge,
primajacie, was of the view that the appeal was not maintainable.
Neve1theless, he referred the matter to the Division Bench, which, it
H
1152 SUPREME COURT REPORTS (2007] 11 S.C.R.
-·
\

A appears referred it to a Full Bench. While the matter was pending
consideration by the Full Bench, execution proceedings were filed.
The.~fore, writ petitions were filed before the High Cowt The High Court,
by the impugned order in each c;ase, dismissed the writ petitions holding
that thqugh arguable questions were involved, the writ petitions did not
B de~rve CQI1Sidera,tion.
4. In support of the appeals, learned counsel for the appellant-
Insurance Gompany subviitted that the appeals in terms of Section 173
of the Ac;t we.re m,aipta)nable arid in any event, the {nsurap.ce Company
has no liability in resp~t of the persons ti:awlling in trQllies a,ttached to
C the Tractors.
5. There is no appea{an,ce on behalf of the respondents when the
111atter was called.
6. So far as the question of maintainability aspect ~s conceme~ the
D issue is concluded by ajudgment of this Court in Smt. Yallwwa & Ors.
v. National Insurance Co. Lt4 and Anr., (2007) 8 SCALE 77.
7. I.n paragraphs 16 to 19 of the jl:lclgment, it was observed as
follows:
'-'16. The ql,l~On,wlJ.ich is require.cl to be CQnsi(iere,d is.wlltlt WOWd
be the meaning o{ the tern:i 'award' when sµch ~ co.Qtenc~ioP: is ·
rais~. Altli<?IJgp_ in a given sitpation having regar(l to the. liab.ility
of the owner o{ the ve.hicle, a claim Tribunat ne~ n<;>t g0_i}1_tQ the
questjqn ~ to whether the. owner of tl).e ve.wcle in ques.tion was 1;1t
fault or not_, but_ c!_eterq:lln_<tt_i_on o( t_he Ii_[!bility o( the_ in_~ilran.ce
company,. in QW opinjoI),, slfill~s on a_ dif:fer~nt. fQoth1g. When_ a
statutory liability h_as been illlposed upon tbe owner, in our opinion,
the same cruwot. e.xtend, the lial;>iJity of an ~r to indemnify the
owner, although in terms of the insurance policy or und~r the Act,
it would-not b~ liable tl1erefor. - -
....
J
17~ In a giv~n ~e, the st,atutory liability, of an insurance company,
therefore, eitl;ier- may be nil or a sum lower· than the amount
specified_ 4nqer- Section 140 of the-Act l'hus, when a se.pai:ate
applic;ation is file<! in terms of Sectjon 140 o~ the A~t, in t~m,::is of
Section 168 thereof, an insurer has to be given a notice in which
UNITEDINDIAINSURANCECO.LTD. v. SERJERAO 1153
[PASAYAT,J.]
event, it goes without saying, it would be open to the insurance {\.
company to plead and prove that it is not liable at all.
18. Furthermore, it is not in dispute that there can be more than
one award particularly when a sum paid may have to be adjusted
from the final award. Keeping in view the provisions of Section '
168. of the Act, there cannot be any doubt whatsoever that an B
award for enforcing the right under Section 140 of the Act is also
required to be passed under Section 168 only after the parties
concerned have filed their pleadings and have been given a
reasonable opportunity of being heard. A Claims Tribunal, thus,
must be satisfied that the conditions precedent specified in Section C
140 of the Act have been substantiated, which is the basis for
1

making an award.
19. Furthe1more, evidently, the amount directed to be paid even
in tenns of Chapter-X of the Act must as of necessity, in the event D
of non-compliance of directions has to be recovered in terms of
Section 174 of the Act. There is no other provision in the Act '
which takes care of such a situation. We, therefore, are of the
opinion that even when objections are raised by the insurance
company in regard to its liability, the Tribunal is required to render
a decision upon the issue, which would attain finality and, thus, E
the S8!11e would be an award within the meaning of Section 173
of the Act."
8. So far as the question ofliability regarding labourers travelling in
trollies is concerned, the matter was considered by this Court in Oriental F
Insurance Company Ltd v. Brij Mohan and Ors., (2007) 7 SCALE
753 and it was held that the Insurance Company has no liability. In view
of the aforesaid two decisions of this Court, we set aside the impugned
order in each case and remit the matters to the High Court to consider
the ma~ers afresh in the light of what has been stated by this Court in
Smt. Yalrwwa 's case (supra) and Brij Mohan 's case (supra). G
9. The appeals are accordingly disposed of with no order as to
-costs.
K.K.T. Appeals disposed of.
H