Supreme Court of India
UNITED INDIA INSURANCE CO. LTD.versusSURESH K.K. & ANR.
- Citation
- 2008 INSC 456
- Decided
- 4 April 2008
- Disposal
- Case Allowed
Holding
Section 147(1) of the Motor Vehicles Act covers only the owner of goods or his authorised representative, not a gratuitous passenger, and a breach of the policy condition excludes insurer liability, but the insurer may be directed to pay the compensation and recover it from the vehicle owner to do complete justice.
Summary
The claimant, a coolie, hired a three‑wheeler auto‑rickshaw (a goods carriage) and was seated beside the driver when the vehicle overturned, causing serious injuries. He claimed compensation under Section 166 of the Motor Vehicles Act, asserting that he was covered by the compulsory insurance under Section 147(1) as the "owner of goods or his authorised representative". The High Court held that the owner or representative of goods is covered irrespective of the presence of goods, but the Supreme Court clarified that the statutory protection extends only to the owner of goods or his authorised representative and does not include a gratuitous passenger. The Court found that the insurer’s policy condition prohibiting passengers sharing the driver’s seat was breached, thereby excluding insurer liability, yet directed the insurer to pay the compensation and recover the amount from the vehicle owner to achieve complete justice. The appeal was allowed in part and no costs were awarded.
Issues considered
- Whether a person who hires a goods‑carriage vehicle but is not the owner of goods falls within the definition of "owner of goods or his authorised representative" under Section 147(1) of the Motor Vehicles Act.
- Whether a gratuitous passenger is covered by the compulsory insurance mandated by Section 147(1).
- Whether a breach of the insurance policy condition (allowing a passenger to sit beside the driver) disqualifies the insurer from liability.
- Whether the insurer can be directed to pay compensation and recover the amount from the vehicle owner despite the breach.
Legislation cited
- Constitution of Indias. Article 142
- Motor Vehicles Act, 1988s. 147(1), s. 166
Subjects
Motor Vehicles ActSection 147Compulsory insuranceGratuitous passengerInsurance breachCompensationAuto rickshawGoods carriageLiability
Judgment
[2008] 5 S.C.R. 1178
A UNITED INDIA INSURANCE CO. LTD.
v
SURESH K.K. & ANR.
(Civil Appeal No. 2565 of 2008)
APRIL 4,2008
(S.8. SINHA AND LOKESHWAR SINGH PANTA, JJ.)
Motor Vehicles Act, 1988
ss.147(1) and 166 - Three wheeler 'goods carriage' -
C Accident- Injury to person sitting by the side of driver claiming
himself as 'owner of goods' - Claim for compensation -
Allowed by High Court directing the insured and insurer to pay
the compensation - Held: High Court may be correct inholding
that owner of goods would be covered in terms of s.147(1) -
D But, as no other person whether passenger or owner of vehicle
is supposed to share the seat of the driver, violation of
condition of contract of insurance is proved - Tribunal and
High Court should have held the owner of the vehicle as guilty
of breach of condition of policy- However, keeping in view the
E fact that the claimant being a coolie and may not be able to
realise the dues from owner of the vehicle, with a view to do
complete justice between the parties, insurer is directed to pay
the amount to the claimant and realise the same from owner
of the vehicle - Insurance - Breach of condition of policy -
F Constitution of India, 1950 - Article 142.
National Insurance Co. Ltd. v Baljit Kaur 2004(2) SCC 1
referred to.
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
G 2565 of 2008.
From the final Judgment and Order dated 7.4.2006 of the
High Court of Kera la Ernakulam in MACA No. 1018/2004
K.L. Nandwani, S.K. Mishra, Raj Kishore Choudhary and
H 1178
UNITED INDIA INSURANCE CO. LTD. v. SURESH KK. 1179
&ANR.
Debasis Mishra for the Appellant. A
The following order of the Court was delivered:
.Leave granted.
Despite service of notice nobody has appeared on behalf
of the responden~. B
The core question which arises for consideration in this
appeal is as to whether a person who has hired a goods carriage
vehide would come within the purview of sub-Section 1 of
Section 147 of the Motor Vehicles Act, 1988, although no goods c
as such were carried in the vehicle.
The claimant/respondent was a 'coolie-worker'. He
allegedly hired an auto rickshaw which is a goods carriage
vehicle bearing registration No. KL-8/M8568. The accident
occurred when he was sitting by the side of the driver. According D
to him the driver was driving the vehicle in a most rash and
negligent manner. When the vehicle reached at Kandanchira,
the driver turned it to the left side without applying brake, as a
result whereof, it overturned: The claimant allegedlYsuffered the
following injuries : E
"1. Compound fracture lower both bones of 113rd left leg
and multiple abrasions.
2. Lacerated would (R) & (L) Legs."
He filed a claim application in terms of Section 166 of the F
Motor Vehicles Act for a sum of Rs. 2.25 Lakhs; the details
't whereof are as under :
"a) Loss of earning from 13.08.99
to till now Rs. 15,000.00 G
b) Partial loss of earnings
from ..... to .....
at the net rate of Rs .....
a day I week Rs. 10,000.00
c) Transport of hospital Rs. 3,000.00 H
1180 SUPREME COURT REPORTS [2008] 5 S.C.R.
A d) Extra nourishment Rs. 25,000.00
e) Damage of clothing & Article Rs. 2,000.00
f) Other : Medical Expenses Rs. 40,000.00
95,000.00
B
g) Compensation for pain & suffering Rs. 30,000.00
h) Compensation for continuing or
permanent disability, if any Rs. 50,000.00
i) Compensation for the loss of
c earning Rs. 50,000.00
Rs. 1,30,000.00
Total Rs. 2,25,000.00
D Appellant in his written statement raised the contention that
although the vehicle in question was insured, it is not liable to
reimburse the owner of the vehicle as the injured was not the
owner of the alleged goods carried therein, and he was travelling
as a gratuitous passenger. Violation of conditions of policy was
E also alleged. By reason of the award dated 23.01.2003, the
Tribunal held :
"10. I have already found that the accident had occurred
due to the rash and negligent driving of the goods auto
rickshaw by the 1st respondent. That he was also the owner
F
of that vehicle, at the time of accident, is evident from Ext
A3, Report of Inspection of the vehicle. Hence he is liable
to pay the rickshaw was insured with the 2nd respondent
the time of accident. Ext. 81 is copy of the insurance
policy. Hence, they respondents 1 and 2 are liable to pay
G
the compensation to the petitioner. Issue is found
accordingly."
A sum of Rs. 1.19,300/- was awarded in favour of the
claimant with interest @ 9% pr annum. Appellant preferred an
H appeal before the High Court in terms of Section 173 of the
UNITED !NOIA INSURANCE CO. LTD. v. SURESH K.K. 1181
&ANR.
Motor Vehicles Act. The High Court negatived the contention of A
the appellant that the word 'goods' was used in Section 147 of
the Act, would not be referable to the word 'carried' stating :
. .
"According to us, the language of the amended provision
does not show that the owner or the representative must
accompany the goods or his representative who hires the 8
vehicle travels in the hired vehicle from the place of hiring
to the place where the goods are to be loaded into the
vehicle and then proceeds to travel along with the goods.
It is also common that after unloading the goods such
passengers travel in the same vehicle to the place from C
where they commenced journey. The passenger does so
and is allowed to do so in his capacity as the owner of the
goods or his representative who has hired the vehicle for
transporting goods. The amended provision makes it
explicitly clear that the word 'carried' qualifies the owner D
of goods or his representative and not the goods carried.
If goods are found _inside the vehicle at the time of the
accident, it is a clinching circumstance to establish that
the passenger who claims to be the owner of goods or the
owner's representative was travelling in that capacity. E
Chances of passengers or the insured raising false claims
in this regard cannot be safe method to ascertain the
intention of the Legislature. False claims can be
disapproved by appropriate contentions. In our view, such
issues are matters of evidence and will not stand scrutiny F
while construing a beneficial provision intended to
compensate the loss caused to innocent victims of motor
accidents. The party who claims that the person
representative of the owner of the goods shall discharge
the burden cast on him. Merely for the reason that the G
benefit granted will be misused, it will not be proper to
give a narrow interpretation to the above provision. We,
therefore, hold that the owner or the authorised
representative need not invariably be shown to accompany
the goods at the time the goods carriage meets with
H
1182 SUPREME COURT REPORTS [2008] 5 S.C.R.
A accident causing injury to or resulting in the death of the
passenger who is either the owner of the goods or the
authorised representative of the owner of the goods."
Mr. Nandwani, learned counsel appearing on behalf of the
appellant would urge that the High court committed a serious
8 error in passing the impugned judgment in so far as it failed to
take into consideration that :
1. the vehicle in question being a goods vehicle, the
driver could not have allowed anybody to sit by his
c side.
2. the Tribunal as also the High Court did not arrive at
the finding that the claimant/respondent was the owner
of goods particularly when no goods were found to
have been carried therein.
D
3. on a plain reading of sub clause (i) of Clause (b) of
the sub-section 1 of Section 147, the words 'carried
~
in the vehicle" must be held to be qualifying 'owner
of the goods' or 'his authorised representative'.
E 4. Section 147 (b) (i) reads as under :
"(i) against any liability which may be incurred by
him in respect of the death of or bodily injury to any
person, including owner of the goods or his
authorised representative carried in the vehicle or
F damage to any property of a third party caused by or
arising out of the use of the vehicle in a public place."
5. Section 147 provides for mandatory insurance. The
policy of insurance in terms of the said provision
must be in relation to the person or classes of person
G
specified in the policy sought to be insured. The
insurance would be against any liability which the
insured incurs.
<(
The insurance policy should, inter alia, be in respect of
H death or bodily injury of the person carried in the vehicle. Such
UNITED INDIA INSURANCE CO. LTD. v. SURESH K.K. 1183
& ANR.
_.
person may be the owner of the goods or his authorised A
representative.
The High Court, therefore, may be correct that the owner
or the goods would be covered in terms of the said provision.
But the question which has not been adverted to by the B
High Court is as to whether the policy contemplates the liability
1 of the owner of the vehicle in respect of a person who was in the
vehicle in a capacity other than owner of the goods. If a person
has been travelling in a capacity other than the owner of the
goods, the insurer would not be liable. The purpose for which c
the provision had to be amended by Act No. 54 of 1994 was to
widen the scope of the liability of the insurance company.
It is now well settled that the term 'any person' envisaged
under the said provision shall not include any gratuitous
passenger. D
~
(1) (National Insurance Co. Ltd. v. Baljit Kaur 2004 (2)
sec 1).
If the claimant had not been travelling in the vehicle as
owner of the goods, he shall not be covered by the policy of the E
insurance. In any view of the matter in a three wheeler goods
carriage, the driver could not have allowed anybody else to share
his seat. No other person whether as a passenger or as a owner
of the vehicle is supposed to share the seat of the driver.
Violation of the condition of the contract of insurance, therefore, F
is approved.
'f
The Tribunal and the High Court, therefore, in our
considered opinion, should have held that the owner of the
vehicle is guilty of the breach of the conditions of policy.
G
The question which arises for our consideration, however,
is keeping in view the fact that the accident took place on or
about 13.08.99, and further in view of the fact that the claimant
' was a coolie worker as to whether he would be in a position to
realise the dues from the owner of the vehicle. We think not.
H
1184 SUPREME COURT REPORTS [2008] 5 S.C.R.
A Keeping in view the aforementioned facts and
circumstances into consideration, we are of the opinion that with
a view to do complete justice between the parties, a direction
should be given to the appellant to pay the amount to the claimant
and realise the same from the owner of the vehicle. Such a
B direction would, in our opinion, serve the ends of justice.
We are passing this order also in view of the fact that the
appellant has already deposited the amount pursuant to a
dirt:ction issued by this court dated 13.11.06.
c The appeal is allowed to the above extent.
No costs.
R.P. Appeal Allowed.
Search Indian case law
Ask in plain English, not just keywords. 25,000 AI words free, no card.
Try "Motor Vehicles Act"Sign in to search