JUDGMENT 1. - This is an appeal against the judgment and award of the learned Motor Accidents Claims Tribunal, Jodhpur (hereinafter referred to as the Tribunal) dated 27.4.1982 whereby the learned lower court has awarded a sum of Rs. 7,500/- in favour of claimant-respondent No. 1 against the appellant and has rejected the claim of the claimant-respondent No. 1 against the respondent Nos. 2 and 3. The amount of the claim has been made payable with 6 per cent interest per annum from 3.10.1977. 2. The facts necessary to be noticed for the disposal of this appeal briefly stated are: that the claimant-respondent No. I Shanker- lal was going to Sheoganj alongwith his companions Prabhu, Mangilal, Tararam, Liladhar and Pukhraj on three cycles at about 9.30 p.m. on 2.4.1978 to see a picture at Sheoganj. When they reached the 'Jawai Bridge', on account of an upgradient in the road of the bridge, they got down from their cycles. It is alleged that from the opposite side, i.e., from Sheoganj side, a car came at a fast speed and struck against the cycle of claimant-respondent No. I Shankerlal. That car was bearing No. RJQ 3191. It was an Ambassador car and was driven by appellant Shankerlal. It struck against the cycle of claimant-respondent No. I Shankerlal, by which he received two grievous injuries and five simple injuries. It is alleged that the car was being driven with such a high speed that it dragged the injured to a distance of about 30 feet and when his leg released from the bumper of the car, he fell down and that is how his life was saved. He was then shifted to Sumerpur Hospital where he remained as an indoor patient for quite some time. According to the claimant-respondent No. 1, his companions Prabhu and Liladhar also got injuries but this claim does not relate to them. It is alleged that this vehicle is owned by non- applicant-respondent No. 2 Magharam and it is insured with non-applicant-respondent No. 3. The claimant-respondent No. I has preferred a claim for a sum of Rs. 20,000/- on account of the injuries that have been received by him. 3. Non-applicant-respondent No. 2 Magharam sent his reply by post. It was received in the court through a registered letter on 31.1.1979. The claimant-respondent No. I has preferred a claim for a sum of Rs. 20,000/- on account of the injuries that have been received by him. 3. Non-applicant-respondent No. 2 Magharam sent his reply by post. It was received in the court through a registered letter on 31.1.1979. It has been mentioned in this reply that this vehicle has been sold by Magharam to appellant Shankerlal, who was its driver on 26.12.1975 for a sum of Rs. 8,011/- and the appellant Shankerlal paid him a sum of Rs. 7,511/- then and there and the remaining amount of Rs. 500/- was paid to him on 15.3.1976 and, therefore, on the date of the accident, i.e., on 2.4.1978, the vehicle already stood transferred in the name of non- applicant-appellant Shankerlal and hence, non-applicant-respondent No. 2 Magharam is not liable to pay any compensation so far as this accident is concerned. 4. Mr. M.L. Kala, learned counsel for the non-applicant-appellant has submitted that reply sent by post cannot be considered. If non-applicant-respondent No. 2 Magharam had put in appearance in the court and filed the reply, it could have been considered but as the reply has been received by post, no notice of such a reply can be taken by the court. So far as the insurance company, i.e., non-applicant-respondent No. 3 is concerned, it has taken the plea that it has come to know that non-applicant-respondent No. 2 Magha- ram has sold his vehicle to appellant Shankerlal before 2.4.1978. It has further submitted that although it is true that originally, this car was owned by defendant No. 2 Magharam but when it has been sold to the appellant by non-applicant-respondent No. 2 then no privity of contract existed between the appellant and respondent No. 3 and, therefore, respondent No. 3 is not liable to any compensation. It has also been claimed that on the date of the accident, this vehicle was not insured. It was also conceded that the driver was not having any valid licence for driving the car and, therefore, the respondent No. 3 is not liable to pay any compensation. 5. On the basis of these pleadings of the parties, certain issues were framed. The appellant Shankerlal initially filed no reply but later when issues were framed, he filed an application for setting aside the ex pane orders against him. 5. On the basis of these pleadings of the parties, certain issues were framed. The appellant Shankerlal initially filed no reply but later when issues were framed, he filed an application for setting aside the ex pane orders against him. That application was accepted on payment of costs but that cost was not paid and, therefore, the reply filed by appellant on 8.12.1981 has not been considered by the learned Tribunal. In the reply, it has been contended that appellant Shankerlal was not driving the car rashly and negligently. 6. Claimant-respondent No. I examined PW 1 Pukhraj, PW 2 Tarachand, PW 3 Dr. S.P. Purohit, PW 4 Prabhulal, PW 5 Prakash- chandra and PW 6 Shankerlal. Nobody has entered in the witness-box on behalf of the non-applicants. 7. After hearing the parties, the learned lower court has decreed the claim of the claimant-respondent No. 1 against the appellant as aforesaid. It held that because the vehicle has been transferred by non- applicant-respondent No. 2 in favour of the appellant before the accident, the respondent No. 2 is not liable for payment of damages and consequently, the respondent No. 3, insurance company, is also not liable to pay any compensation. Aggrieved against this judgment of the learned Tribunal, non- applicant No. 1-appellant has preferred this appeal and has prayed that the findings of the learned Tribunal regarding issue No. 2 be quashed and respondent Nos. 2 and 3 should be made liable for payment of the sum awarded by the learned Tribunal. 8. 1 have heard Mr. M.L. Kala, learned counsel for non-petitioner No. 1-appellant, Mr. RL. Jangid, learned counsel for the claimant-respondent No. 1 and Mr. P.K. Bhansali, learned counsel for respondent No. 3. 1 have carefully gone through the record of the case. 9. Mr. M.L. Kala, learned counsel appearing for the appellant, has submitted that although the appellant has not paid the costs awarded by the learned lower court for setting aside the ex pane decree and so for the non- payment of the costs, his defence should not have been closed. In this respect, he has placed reliance on a decision of this court in Gulabsingh v. Dhanraj, 1982 WLN 609 , wherein it has been held that if the payment of costs is not made on account of bona fide mistake or inadvertent error then the court should not take extreme step of closing the evidence. In this respect, he has placed reliance on a decision of this court in Gulabsingh v. Dhanraj, 1982 WLN 609 , wherein it has been held that if the payment of costs is not made on account of bona fide mistake or inadvertent error then the court should not take extreme step of closing the evidence. In this case, it has not been pleaded that the cost has not been paid on account of a bona fide mistake or inadvertence. The appellant was granted several adjournments to pay the costs but despite that, he has failed to pay the costs and therefore, the proceedings were again ordered to be taken ex pane against him. It is neither a case of bona fide mistake nor a case of inadvertence and nor a case of closure of the evidence but of the closure of defence because costs for setting aside ex pane decree were not paid in spite of providing him with several opportunities to pay them and hence, this ruling has no application to the facts and circumstances of this case and, therefore, this preliminary objection of Mr. M.L. Kala stands overruled. 10. Mr. M.L. Kala, learned counsel for the appellant, has next submitted that this court has consistently taken the view that the transfer of motor vehicles is not governed by the provisions of Sale of Goods Act and the compliance of section 31 of the Motor Vehicles Act is essential for completion of a transfer by sale of motor vehicle. In this respect, he placed reliance on a decision of this court in United Motors of Rajasthan v. Mathuralal, 1970 RLW 589 , wherein, while relying on Vimal Rai v. Gurcharan Singh, 1967 ACJ 115 (Delhi) , Hon'ble CM. In this respect, he placed reliance on a decision of this court in United Motors of Rajasthan v. Mathuralal, 1970 RLW 589 , wherein, while relying on Vimal Rai v. Gurcharan Singh, 1967 ACJ 115 (Delhi) , Hon'ble CM. Lodha, J. (as he then was) observed as under: "For the purposes of this case, it is not necessary to decide whether the ownership of a motor vehicle can be recognised only when the fact of transfer of ownership is reported to the Registering Authority but there is not doubt in my mind that by the provisions of section 31 of the Act, responsibility has been placed both on the transferee and the transferor to report the fact of transfer to the Registering Authority within a certain time, and thus, law required something more for the sale of motor vehicles than what is necessary for sale of other immovable property." Placing reliance on the aforesaid observations contained in Vimal Rai's case, 1967 ACJ 115 (Delhi), a Division Bench of this court in Padma Devi v. Gurbakhsh Singh, 1973 ACJ 460 (Rajasthan) , held that the owner of the vehicle in whose name the motor vehicle has been registered is the ostensible owner of the vehicle unless proceedings were taken for transfer of the ownership as requisite under section 31 and permit also continued in his name. It was further held that the provisions of section 31 of the Act are mandatory and its compliance is necessary for the transfer of the ownership of a public vehicle. Vimal Rai's case, 1967 ACJ 115 (Delhi), United Motors of Rajasthan's case, 1970 RLW 589, and Padma Devi's case, 1973 ACJ 460 (Rajasthan), were followed in a later decision of this court in Maina v. Niranjan Singh, 1976 ACJ 1 (Rajasthan). 11. However, a Division Bench of this court in Automobile Transport (Rajasthan) P. Ltd. v. Dewalal, 1977 ACJ 150 (Rajasthan) , held that the law laid down by this court in United Motors of Rajasthan's case, 1970 RLW 589 and Padma Devi's case, 1973 ACJ 460 (Rajasthan), and Maina's case, 1976 ACJ 1 (Rajasthan), does not lay down good law. 11. However, a Division Bench of this court in Automobile Transport (Rajasthan) P. Ltd. v. Dewalal, 1977 ACJ 150 (Rajasthan) , held that the law laid down by this court in United Motors of Rajasthan's case, 1970 RLW 589 and Padma Devi's case, 1973 ACJ 460 (Rajasthan), and Maina's case, 1976 ACJ 1 (Rajasthan), does not lay down good law. The Division Bench in this case observed that in the earlier cases decided by this court, the ratio and observations made in Vimal Rai's case, 1967 ACJ 115 (Delhi), were followed and Vimal Rai s case (supra) was decided by a learned single Judge of the Delhi High Court but on appeal, that decision was overruled by the Division Bench of the Delhi High Court. It was, therefore, observed: "that the provisions of the Act regarding registration and issue of permit have nothing to do with ownership of the vehicle. They only provide for regulation of the use of the motor vehicles in public places and if the requirements of the Act were not fulfilled, penalties were attracted. The transfer in the records of the Registering Authority is not a condition precedent to the transfer nor does it deal with the legality or validity of the transfer which must be determined by other provisions of the law. A person though registered as owner may or may not be a real owner and for the purposes of awarding compensation, it is the real owner who should be found out by the court on the facts of each case." It was further held that the sale of a motor vehicle is not governed by section 54 of the Transfer of Property Act but it being a movable property was to be governed by the provisions of the Sale of Goods Act. The ratio of this decision of the Division Bench in Automobile Transports case, 1977 ACJ 150 (Rajasthan), stands fully vindicated by a higher authority of their Lordships of the Supreme Court in Pannalal v. Shri Chand Mal, 1980 ACJ 233 (SC) , wherein their Lordships of the Supreme Court held that in the transfer of a vehicle, if the owner sold the vehicle to the transferee and the registration papers and sale memo have been handed over to the transferee but the registration continued to remain in the name of the owner because the transferee failed to move the registration authority for transfer, the sale will not be ineffective and the transferee cannot claim refund of the purchase money or damages from the owner. Their Lordships felt that the sale of a motor vehicle is governed by the Sale of Goods Act. It was further observed that section 31 itself starts with the clause that within thirty days of the transfer of ownership of any motor vehicle registered under this Chapter, the transferee shall report the transfer to the Registering Authority within whose jurisdiction he resides and shall forward the certificate of registration to that registering authority together with the prescribed fee in order that the particulars of the transfer of ownership may be entered therein. It is, therefore, clear that for making a transfer complete, it is not necessary that the name of the transferee should be recorded with the Registering Authority. 12. In this case, it may be worthwhile to note here that it has not been shown that any written document of sale was executed between the parties. It is not further clear that registration papers etc. were handed over to the transferee by the transferor and, therefore, it can be held that this sale is not complete. So far as the non-applicants are concerned, none has entered in the witness-box. Non- applicant No. 1-appellant could not do so because he did not pay the costs for setting aside the ex pane order against him and so, the case proceeded against him ex pane. Non- applicant No. 2-respondent No. 2 has not put in appearance in the court and nobody has been examined on behalf of non-applicant- respondent No. 3 and, therefore, nothing has been brought on record to show that registration papers, sale memo and any other relevant documents have been handed over to the transferee. Non- applicant No. 2-respondent No. 2 has not put in appearance in the court and nobody has been examined on behalf of non-applicant- respondent No. 3 and, therefore, nothing has been brought on record to show that registration papers, sale memo and any other relevant documents have been handed over to the transferee. It has also not come on record whether any receipt has been executed and that has been issued by the transferor to the transferee. In these circumstances, I feel that there is some force in the contention of Mr. M.L. Kala, learned counsel appearing for non-applicant-appellant that there is no proof on record that the vehicle has been transferred by the non-applicant-respondent No. 2 in favour of non-applicant-appellant. Moreover, Magharam has claimed that he has sold this vehicle to the appellant Shanker- lal on 26.12.1975 whereas he got it insured in his name from 29.5.1977 to 28.5.1978. Had he sold the vehicle, he could not have paid the premium to get the vehicle insured almost one and a half year after its sale in favour of the appellant. This also shows that actually, the plea of sale put forth by the non- applicants is ficticious and weak. 13. It has been claimed by the claimant- respondent No. 1 in his claim petition that non-applicant-respondent No. 2 is the owner of this vehicle and non-applicant No. 1- appellant is only its driver and this vehicle has been insured with the non-applicant- respondent No. 3 and, therefore, all the three non-applicants are responsible to compensate him. The learned lower court has, however, relied on an admission contained in the statement of PW 6 Shankerlal, claimant- respondent No. 1, that the vehicle has been transferred before the accident by non- applicant-respondent No. 2 to non-applicant- appellant. Actually, in the examination-in- chief, the claimant-respondent No. 1 has stated on oath that the vehicle belongs to non-applicant-respondent No. 2 and non- applicant No. 1-appellant is its driver. Even in cross-examination, he has stated that the owner of the vehicle is non-applicant- respondent No. 2 Magharam and the vehicle was insured in his name but in the next sentence, he has stated that it is correct to say that non-applicant-respondent No. 2 has sold the vehicle to non-applicant-appellant before the accident and so, the non-applicant- respondent No. 2 was not the owner of the vehicle at the time of the accident. The insurance policy existed in the name of the non-applicant-respondent No. 2 at the time of the accident. Much stress has been laid on this admission. Actually, this admission is against the pleadings and it is not clear as to on what information it is based. If somebody on the hearsay testimony comes to know that the vehicle might have been transferred, it does not mean that that has been accepted by him as a fact. It is the duty of the owner of the vehicle or its driver to prove that the sale of the vehicle has taken place and as observed earlier, none has appeared on behalf of the non-applicants to prove this fact. Not a single document has been produced to support this fact. Actually, the insurance policy has been filed which shows that the proposal for the insurance from 29.5.1977 to 28.5.1978 was made by non-applicant-respondent No. 2 Magharam. Non-applicant-respondent No. 2 Magharam has mentioned in his reply filed by post that the vehicle was sold by him to non-applicant-appellant Shankerlal on 26.12.1975 for a sum of Rs. 8,011/- and the appellant Shankerlal paid him a sum of Rs. 7,511/- then and there and the remaining amount of Rs. 500/- was paid to him on 15.3.1976, i.e., that the entire sale consideration was paid to him more than one year before the proposal for getting this vehicle insured was made by him. If he has really transferred the vehicle and has handed over the papers to non-applicant-appellant Shankerlal then there was no occasion for him to have filed the proposal for getting the vehicle insured in his own name on 29.5.1977. This clearly shows that he has not transferred the vehicle and he was actually the owner of the vehicle and non-applicant-appellant Shankerlal was its driver. I, therefore, hold that there is a lot of substance in the submission of Mr. Kala, learned counsel for the appellant, that in this case, non-applicant-respondent Nos. 2 and 3 have failed to prove that the ownership of the vehicle has been transferred by non-applicant- respondent No. 2 Magharam in favour of non-applicant-appellant Shankerlal. 14. Be that as it may, even if for the arguments' sake we accept the submission of non-applicant-appellant Shankerlal that the vehicle was transferred prior to the accident by non-applicant-respondent No. 2 Magharam to the claimant-appellant then too, it has to be decided whether non-applicant-respondent Nos. 14. Be that as it may, even if for the arguments' sake we accept the submission of non-applicant-appellant Shankerlal that the vehicle was transferred prior to the accident by non-applicant-respondent No. 2 Magharam to the claimant-appellant then too, it has to be decided whether non-applicant-respondent Nos. 2 and 3 are responsible for the payment of the amount of compensation awarded by the Tribunal. In this respect, Mr. P.K Bhansali, learned counsel appearing for the respondent No. 3, has submitted that once the vehicle has been transferred, no insurable interest subsists in favour of the insured. According to him, the policy lapses as soon as the vehicle is transferred in the name of another person by sale or otherwise or the insured dies or becomes bankrupt. In this respect, reliance was placed on Motor Owners' Insurance Co. Ltd v. Khet Pal Singh, 1982 ACJ (Supp) 383 (Rajasthan) , wherein D.P. Gupta, Actg. CJ. (as he then was) observed as follows: "The contract of insurance is a personal contract of indemnity and the same comes to an end and the insurance policy lapses as soon as the ownership of the motor vehicle covered by the said policy of insurance is transferred to another person by sale or otherwise or the insured dies or becomes bankrupt." In Precto Pipe Co. v. National Ins. Co. Lid, 1984 ACJ 218 (P&H) , a learned single Judge of the Punjab & Haryana High Court observed that where insured transferred the vehicle before the accident and purchaser sent letters under certificate of posting to the insurance company seeking transfer of policy but no such plea was taken in the claim application and the insurance company denied such intimation and the statement to this effect remained unchallenged, it was held that the insurance company is not liable to any compensation. In that case, the accident took place on 23.10.1974 and the vehicle was transferred on 17.6.1974. The insurance policy remained in force from January 24, 1974 to January 23, 1975. The intimation of the transfer was sent on 31.10.1974 and, therefore, it was held that the insurance company is not liable. Mr. Bhansali also placed reliance on National Insurance Co. In that case, the accident took place on 23.10.1974 and the vehicle was transferred on 17.6.1974. The insurance policy remained in force from January 24, 1974 to January 23, 1975. The intimation of the transfer was sent on 31.10.1974 and, therefore, it was held that the insurance company is not liable. Mr. Bhansali also placed reliance on National Insurance Co. Ltd v. Labanya Roy, 1985 ACJ 720 (Calcutta) , wherein it has been held that if the vehicle insured in the name of B had been transferred in favour of G before the accident and no application under section 103-A was made by B to transfer the certificate of insurance, the insurance company is not at all liable to pay any compensation for the accident. 15. Actually, the majority of the High Courts in the country have taken the view that on transfer of the motor vehicle, no insurable interest survives in the insurer and when it does not survive in favour of the insured, the insurance company issuing that policy cannot be held liable for payment of any compensation for the accident. In support of this view, Mr. Bhansali placed reliance on Gulab Bai Damodar tapse v. Peter K. Sunder, 1975 ACJ 100 (Bombay) , H. I. Insurance Co. Ltd v. P. Ankiah, 1972 (1) APU 47 , Hema Ramaswami v. K.M. Valarence Panjani, 1981 ACJ 288 (Madras) , M. Bhoopathy v. MS. Vijayalakshmi, 1966 ACJ 1 (Madras) , Oriental Fire& Genl Ins. Co. Ltd. v. Meena Sharma, 1975 ACJ 335 (P&H) and South India Insurance Co. Ltd v. Puran Chandra Misra, 1973 ACJ 46 (Orissa) . I do not propose to deal and discuss the ratios of all these authorities in detail. It is enough to say that the basic ratio of these decisions is that the contract of insurance is a personal contract of indemnity and the same comes to an end and the insurance policy lapses as soon as the ownership of the motor vehicle covered by the said policy of insurance is transferred to another person by sale or otherwise or the insured dies or becomes bankrupt. Not only a learned single Judge of this court but a Division Bench of this court in Automobile Transport (Rajasthan) P. Ltd. v. Dewalal,1977 ACJ 150 (Rajasthan) , considered several authorities on the point but it did not finally decide this matter on this ground that in the instant case, the owner was unable to prove that he has transferred this vehicle to the transferee. 16. Be that as it may, Mr. M.L. Kala, learned counsel for the non-applicant- appellant, Mr. R.L. Jangid, learned counsel for the claimant-respondent No. 1 and Mr. D.K. Parihar, learned counsel for non- applicant-respondent No. 2, have claimed that these decisions do not hold good so far as this court is concerned, firstly, because this ground that the policy has lapsed on account of the transfer of the vehicle is not available to the insurance company under section 96 (2) of the Motor Vehicles Act, 1939 and secondly, so far as the third parties are concerned, the insurable interest survives in the transferor till the compliance of section 31 of the Act has been made and the insurance company is not absolved of its responsibility to pay compensation. 17. Sections 94, 95 and 96 of the Act have been inserted in the Act to safeguard the interest of the third parties, who use the public road and whose life is always in jeopardy on account of the public vehicles run on the road and, therefore, this fact should be kept in view that these provisions have been inserted in the Act for the benefit of the third parties or to safeguard the interest of the third parties. In Skandia Ins. Co. Ltd. v. Kokilaben Chandravadan, AIR 1987 SC 1184 : 1987 ACJ 411 (SC) , their Lordships of the Supreme Court have observed as follows: "It needs to be emphasised that it is not the contract of insurance which is being interpreted. It is the statutory provision defining the conditions of exemption which is being interpreted. These must, therefore, be interpreted in the spirit in which the same have been enacted accompanied by an anxiety to ensure that the protection is not nullified by the backward looking interpretation which serves to defeat the provision rather than to fulfil its life-aim. It is the statutory provision defining the conditions of exemption which is being interpreted. These must, therefore, be interpreted in the spirit in which the same have been enacted accompanied by an anxiety to ensure that the protection is not nullified by the backward looking interpretation which serves to defeat the provision rather than to fulfil its life-aim. To do otherwise would amount to nullifying the benevolent provision by reading it with a non- benevolent eye and with a mind not tuned to the purpose and philosophy of the legislation without being informed of the true goals sought to be achieved. In order to divine the intention of the legislature in the course of interpretation of the relevant provisions there can scarcely be a better test than that of probing into the motive and philosophy of the relevant provisions keeping in mind the goals to be achieved by enacting the same. Section 94 requiring the owner of the motor vehicle using it in a public place has been inserted in order to protect the members of the community travelling in vehicles or using the roads from the risk attendant upon the user of motor vehicles or the roads. The law may provide for compensation to victims of the accidents who sustain injuries in the course of an automobile accident or compensation to the dependents of the victims in the case of a fatal accident. However, such protection would remain a protection on paper unless there is a guarantee that the compensation awarded by the courts would be recoverable from the persons held liable for the consequences of the accident. A court can only pass an award or a decree. It cannot ensure that such an award or decree results in the amount awarded being actually recovered from the person held liable who may not have the resources. To overcome this ugly situation, the legislature has made it obligatory that no motor vehicle shall be used unless a third party insurance is in force. It cannot ensure that such an award or decree results in the amount awarded being actually recovered from the person held liable who may not have the resources. To overcome this ugly situation, the legislature has made it obligatory that no motor vehicle shall be used unless a third party insurance is in force. To use the vehicle without the requisite third party insurance being in force is a penal offence."It is, therefore, clear that a meaningful interpretation has to be taken keeping in view the dominant spirit of the Act which appears to be to protect the members of the community using the motor vehicles or using the roads from the risk attendant upon the user of the motor vehicles on the road and not to enhance the business of the insurance company and it be ensured that that protection does not remain a protection on paper only. The provisions should be interpreted in a manner where the compensation awarded by the court can be recovered from the persons held liable for the consequences of the accident. This is the actual intention of the legislature and that intention has to be given effect to. It is in this background that it has to be gathered as to what defences are available to the insurance company. 18. The law on the point has been laid down by their Lordships of the Supreme Court in B.I.G. Insurance Co. v. Captain Itbar Singh, 1958-65 ACJ 1(SC) , wherein it has been held that the insurance company cannot raise the defences other than those set out in sub- section (2) of section 96 "the company is not entitled to take any defence which is not specified in sub-section (2)." Their' order ships of the Supreme Court interpreted the pro- visions of the Motor Vehicles Act in giving this verdict and the defences of insurance company were thus narrowed down. It can only take those defences which are permitted to it by law, Le., section 96 (2) of the Act. Their Lordships further observed that to put such an impediment on defence was equitable because the insurance companies are business houses. They have profit motive in doing business. They can always arrange their business to suit their profit motive and therefore, it is held just to put a narrow interpretation on these provisions. The issue has to be considered from the standpoint of `luck'. They have profit motive in doing business. They can always arrange their business to suit their profit motive and therefore, it is held just to put a narrow interpretation on these provisions. The issue has to be considered from the standpoint of `luck'. If such an impediment is placed on the defence of the insurance, it was observed may be it is `bad luck' for the insurance company, but luck was set off as a hazard in business ventures. These perspectives were expressed in the following passage: "We are furthermore not convinced that the statute causes any hardship... avoid all hardship, if any, by providing for a right to defend the action in the name of the assured and this he has full liberty to do. Secondly. if he has been made to pay something which on the contract of the policy he was not bound to pay, he can under the proviso to sub-section (3) and under sub- section (4) recover it from the assured. It was said that the assured might be a man of straw and the insurer might not be able to recover anything from him. But the answer to that is that it is the insurer's bad luck. In such circumstances, the injured person also would not have been able to recover the damages suffered by him from the assured, the person causing injuries. The loss had to fall on someone and the statute has thought it fit that it shall be borne by the insurer. That also seems to us to be equitable for the loss falls on the insurer in the course of his carrying on his business, a business out of which he makes profit, and he could so arrange his business that in the net result he would never suffer a loss..." (Emphasis supplied)This matter again came up for consideration before their Lordships of the Supreme Court in New Asiatic Ins. Co. Co. Ltd v. Pessumal Dhanamal Aswani, 1958-65 ACJ 559 (SC) , where sections 94, 95 and 96 of the Act were again reviewed and it was held that: "Chapter VIII of the Act, it appears from the heading, makes provision for insurance of the vehicle against third party risks, that is to say, its provisions ensure that third parties who suffer on account of the user of the motor vehicle would be able to get damages for injuries suffered and that their ability to get the damages will not be dependent on the financial condition of the driver of the vehicle, whose user led to the causing of the injuries. The provisions have to be construed in such a manner as to ensure this object of the enactment." In adopting such an interpretation importance of insurance policy was again high- lighted by saying that "we are of the opinion that once the company had undertaken liability to third parties incurred by the persons specified in the policy, the third parties' right to recover any amount under or by virtue of the provisions of the Act is not affected by any condition in the policy. It was further observed that it is reasonable to conclude that proviso (a) of para 3 of section II is a mere condition affecting the rights of the insured who effected the policy and the persons to whom the cover of the policy was extended by the company and does not come in the way of third parties' claim against the company on account of its claim against a person specified in para 3 as one to whom cover of the policy was extended. True, it is that provisions of statute are stretched by implication in favour of third parties. This was done to strengthen the remedies of third parties. British India General Insurance Co. Ltd. v. Captain Itbar Singh, 1958-65 ACJ 1 (SC) , was followed by a Division Bench of this court in Padma Devi v. Gurbakhsh Singh, 1973 ACJ 460 (Rajasthan) . This court also placed reliance on Hindustan General Insurance Society Ltd. v. P.R. Narsa Reddi, AIR 1972 AP 151 and Orissa Cooperative Ins. Society Ltd. v. Bhagaban Sahu, 1971 ACJ 49 (Orissa) . This court also placed reliance on Hindustan General Insurance Society Ltd. v. P.R. Narsa Reddi, AIR 1972 AP 151 and Orissa Cooperative Ins. Society Ltd. v. Bhagaban Sahu, 1971 ACJ 49 (Orissa) . In all these authorities quoted above, it has been held that it is not open to an insurance company to raise the plea that the policy lapsed on the transfer of a vehicle in an action by third parties for compensation. Section 96 (2) of the Motor Vehicles Act has specified the defences that are open to an insurance company in a claim by a third party. The specification of the defence is exhaustive and it is not open to an insurance company to raise any other defence. The only circumstance in which the company can take up any other defence than those provided by section 96 (2) of the Act, is when the policy has been cancelled in accordance with the provisions of section 96 (2) (a). In Padma Devi's case, 1973 ACJ 460 (Rajasthan), this court further observed, "we are in respectful agreement with the decisions referred to above and we are firmly of the opinion that it was not open to defendant No. 4 to raise any plea outside the scope of section 96 (2) of the Act. The above observations of Padma Devi's case (supra) were followed by a Division Bench of this court consisting of Bhargava and Israni, JJ. in a recent decision in New India Assurance Company Ltd. v. Sheela Rani, 1988 ACJ 206 (Rajasthan) . Further, it will be profitable here to refer to a decision of their Lordships of the Supreme Court in Skandia Ins. Co. Ltd. v. Kokilaben Chandravadan, 1987 ACJ 411 (SC) , wherein it was observed as follows: "The legislature was also faced with another problem. The insurance policy might provide for liability walled in by conditions which may be specified in the contract of policy. Co. Ltd. v. Kokilaben Chandravadan, 1987 ACJ 411 (SC) , wherein it was observed as follows: "The legislature was also faced with another problem. The insurance policy might provide for liability walled in by conditions which may be specified in the contract of policy. In order to make the protection real, the legislature has also provided that the judgment obtained shall not be defeated by the incorporation of exclusion clauses other than those authorised by section 96 and by providing that except and save to the extent permitted by section 96, it will be the obligation of the insurance company to satisfy the judgment obtained against the persons insured against third party risks." The same view has been expressed by a Full Bench of the Andhra Pradesh High Court in Madineni Kondaiah v. Yaseen Fatima, 1986 ACJ I (AP) , wherein British India General Insurance Co. Ltd.'s case, 1958-65 ACJ 1 (SC), and New Asiatic Iris. Co. Ltd.'s case, 1958-65 ACJ 559 (SC), came up for consideration and their Lordships respectfully followed the ratio of these decisions. These decisions were also considered by a Full Bench of the Gujarat High Court in Shantilal Mohanlal v. Aher Bawanji Malde, 1985 ACJ 505 (Gujarat) , wherein, while interpreting section 96 of the Act, the Full Bench has held that section 96 which casts a legal duty on the insurer to satisfy judgments restricts it to those judgments which are obtained against persons insured by the policy. Therefore, we do not agree with the contention that the object and the relevant provisions of the Act require us to construe the policy in the manner suggested by the counsel representing the claimant. It was also observed that the observations of the Supreme Court in New Asiatic Ins. Co's case, 1958-65 ACJ 559 (SC), cannot be read out of context and, therefore, it was held that the observations of their Lordships of the Supreme Court were given in context of a particular case. Of course, it, i.e., Full Bench of Gujarat High Court has dissented from the decision in Haji Zakaria v. Naoshir Cama, 1976 ACJ 320 (AP) , but the ratio of that decision has been approved by a Full Bench of the Andhra Pradesh High Court in the aforesaid Madineni Kondaiah v. Yaseen Fatima, 1986 ACJ 1 (AP) . Haji Zakaria's case. 1976 ACJ 320 (AP), decided two points. Haji Zakaria's case. 1976 ACJ 320 (AP), decided two points. Firstly, it held that the proof of negligence is not essential. That, of course, has been overruled by their Lordships of the Supreme Court, but the second point that on the death of the insured, the rights under the policy like other properties devolved on his heirs by operation of law has been approved by the Full Bench in the aforesaid decision. I, therefore, hold that this defence is not available to the insurance company that it is not liable for compensation because the vehicle has been transferred prior to the accident by the insured to somebody else. 19. In this case, the facts are little different from the cases, that have been decided by their Lordships of the Supreme Court, this court and Andhra Pradesh High Court. Here, actually, after the alleged transfer, the ostensible owner has applied for the grant of insurance policy and that policy has been issued in his name. The contention of non- applicant-respondent No. 2 Magharam is that he has transferred the vehicle on 26.12.1975 and received the full payment on 15.3.1976 whereas the policy relates to the year 1977-78. It is, therefore, clear that Magharam had some insurable interest in the vehicle and, therefore, he has obtained the insurance policy in his name. I have already held that in this case, it has not been proved that the vehicle has been transferred and, therefore, it can safely be held that when it has not been proved that the vehicle has been transferred, then non- applicant-respondent No. 2 is the real owner of the vehicle. Even if he is its ostensible owner, this court has held in Automobile Transport (Rajasthan) P. Ltd v. Dewalal, 1977 ACJ 150 (Rajasthan) , that under section 94 of the Act, it is not only the real owner of the vehicle who can effect insurance in compliance with the provisions of Chapter VIII of the Act, any other person using a motor vehicle or allowing it to be used at a public place can also effect insurance. The disclosure, therefore, of the real owner of the vehicle to the insurer would not be a material fact for effecting the policy. The disclosure, therefore, of the real owner of the vehicle to the insurer would not be a material fact for effecting the policy. Sub-section (5) of section 96 lays down that the expression 'material fact' means a fact of such a nature as can influence the judgment of a prudent insurer in determining whether he will take the risk and if so, at what premium and on what conditions. The insurer cannot be said to have been influenced in his judgment as to the premium and other conditions merely because it is not disclosed that the ostensible and registered owners of the vehicle are not real owners of the vehicle. In this case, when non-applicant-respondent No. 2 Magharam has obtained the insurance policy about this vehicle even after its alleged transfer, which of course is not proved, then too the insurance policy does not become invalid on that ground. 20. Now, I take up the next contention raised by Mr. M.L. Kala, learned counsel for the non-applicant-appellant, as also by Mr. Jangid that even after the transfer of the vehicle, the compliance of section 31 of the Act has not been made and hence, the insurable interest still survived to non- applicant-respondent No. 2 Magharam and he can still be held liable for the payment of the compensation. When he can be made liable, the insurance company can also be made liable. Both of them have submitted that this is the intention of the legislature as pointed out by their Lordships of the Supreme Court in Skandia Ins. Co. Lid. v. Kokilaben Chandravadan, 1987 ACJ 411 (SC) . All the three advocates placed reliance on a Full Bench decision of the A.P. High Court in Madineni Kondaiah v. Yaseen Fatima, 1986 ACJ I (AP) , wherein Raghuvir, J. speaking for the court observed as follows: "It is seen in our country often owners of vehicles are not anxious to protect third party rights. They do not obtain policies to cover third party risks, though under the Act, it is obligatory. In cases where the vehicle is not insured by the transferor or the transferee an altogether difficult situation emerges which we are not considering in this case. Instances are legion where after sale without covering third party risks the purchasers ply vehicle on the highway. In cases where the vehicle is not insured by the transferor or the transferee an altogether difficult situation emerges which we are not considering in this case. Instances are legion where after sale without covering third party risks the purchasers ply vehicle on the highway. Law journals are replete with instances of cases posing problems and courts considered how best to remedy the victim who due to mistakes of drivers of vehicles on highways either get injured or killed. The pedestrians generally get injured by vehicles. They are simply left high and dry without a remedy even against the insurance company. The Supreme Court, therefore, emphasised the role of the insurance company in this area. The transferor and the transferee are noted not financially solvent to redeem orders or discharge decree passed against them." In this respect, it will be profitable to quote the observations of a Division Bench of the M.P. High Court in Geetabai v. Hussainkhan, 1985 ACJ 44 (MP) , which are as follows: "If the owner of the vehicle by private arrangement transfers a vehicle to another person but continues to be the registered owner thereof, it would be very difficult, if not impossible, for the injured person or the dependents of the deceased person to find out who is the owner of the vehicle at the time of the accident. The problem will become more complex if there is a series of private transfers and the vehicle continues to be under the registered ownership of the original owner. In such cases, the claimants may not get any compensation from the transferee because it may not be known as to who is the actual owner of the vehicle at the time of the accident and such a person may be a man of straw. The helpless claimants also cannot recover compensation from the insurance company because the vehicle is insured in the name of the registered owner. In our opinion, the principle laid down in Mohammad Ramzan'r case, 1982 ACJ 445 (MP), applies to the case in hand also because the tempo at the time of the accident was under the registered owner- ship of respondent No. 2 and was also insured in his name with the respondent No. 3. In our opinion, the principle laid down in Mohammad Ramzan'r case, 1982 ACJ 445 (MP), applies to the case in hand also because the tempo at the time of the accident was under the registered owner- ship of respondent No. 2 and was also insured in his name with the respondent No. 3. When the respondent No. 2, who continues to be the registered owner of the vehicle, transferred it, he must be deemed to have knowledge that the vehicle will be used by the transferee or his agent or servant and that they might use it negligently or rashly causing injury to third persons. If with this knowledge, the respondent No. 2 has transferred the vehicle there is no valid reason why he should not be held liable for the negligent act of the transferee or his servant or agent. As the vehicle was insured in the name of the respondent No. 2 at the time of accident, the respondent No. 3, insurance company, also cannot escape its liability." Held further: "There is also the possibility of an unscrupulous owner of a vehicle indulging in fake transfer of a vehicle to avoid his liability to pay compensation to the claimants claiming compensation on account of an accident caused by the vehicle. The principle of vicarious liability must be extended in such cases so that effective relief may be given to the claimants. In such cases, there is no valid reason why the registered owner should not be held vicariously liable for the negligent act of the transferee or his servant or agent in driving the vehicle." Keeping these facts in view, Kodandaramayya, J., speaking in a separate judgment rendered by him giving additional reasons to support the main judgment, for the court after discussing various authorities of the English courts as also taking into consideration the definition of the `insurable interest' given in different decisions by English courts observed in Madineni Kondaiah's case, 1986 ACJ I (AP), as follows: "it is incorrect to assume that the moment the title of the vehicle passes to the transferee the statutory obligation under section 94 ceases and the original owner is no longer guilty of causing or allowing the purchaser to use the vehicle. The question is when does the statutory liability cease. The mere passing of title in the vehicle to the transferee will not put an end to this liability. The question is when does the statutory liability cease. The mere passing of title in the vehicle to the transferee will not put an end to this liability. For this purpose, we must examine two more provisions of the Act. Under section 31, the transferor shall within 14 days of the transfer report the fact of transfer to the registering authority within whose jurisdiction the transfer is to be effected and shall simultaneously send a copy of the said report to the transferee and within forty-five days of the transfer forward to the registering authority no objection certificate obtained by him under section 29-A. Section 29-A contemplates issuing of no objection certificate both on the occasion of assignment of a new registration mark and also while transferring the motor vehicle. The registering authority is enjoined to issue a certificate within a period of thirty days and if no orders are passed, the registering authority shall be deemed to have granted the no objection certificate. The failure to comply with section 31 is made punishable under section 112....Thus we see till the transferor fulfils the statutory obligation under section 31 his liability continues. Further he is the ostensible owner of the vehicle so long the registration is not changed. The liability to pay tax continues irrespective of his rights against the transferee for reimbursement. In fact, it was ruled in Northern India General Insurance Company Ltd. v. Kanwarjit Singh, 1973 ACJ 119 (Allahabad) , that a registered owner would have sufficient interest to effect insurance because he is the ostensible owner. The question raised in that case was whether the registration in favour of benamidar is valid when the registered owner of the vehicle is only benamidar when the real owner never obtained the insurance. It was held that the registered owner has sufficient interest to effect insurance because he is the ostensible owner and there is nothing in section 94 which would be interpreted to mean that it is only the real owner who could effect the insurance. Any person who uses the vehicle or allows any other person to use the vehicle could also get the insurance effected. Thus, it is seen the public liability to notes the transfer and securing no objection certificate under section 31 read with section 94 would make the original owner retain the insurable interest. Any person who uses the vehicle or allows any other person to use the vehicle could also get the insurance effected. Thus, it is seen the public liability to notes the transfer and securing no objection certificate under section 31 read with section 94 would make the original owner retain the insurable interest. The insurable interest in this case is not the proprietary interest but the public liability, not to run the vehicle or cause or allow any person to run the vehicle without insurance and also to notify the transfer of such vehicle to the registering authority. So long such obligation continues not with- standing the cessation of proprietary interest the insurable interest which is the foundation for the continuance of the operation of the policy stands." (Emphasis provided) In para 47 of the judgment in Madineni Kondaiah's case, 1986 ACJ 1 (AP), it was further observed as follows: "Any prudent purchaser should take steps to get the policy transferred to him under section 103. The insurer is bound to accept the transfer and can only refuse to consent on specified grounds. It is clearly an impracticable view to take that on passing of property in the vehicle, the policy lapses and the obligation under section 94 of the Act ceases. In fact as observed by Supreme Court the policy is to the vehicle and hence normally, it should run with the vehicle. It is just to expect a reasonable time for the transferor to make the necessary arrangement to notify the transfer under section 31 and secure the certificate under section 29-A within the time mentioned in those provisions. If this is not allowed, the moment the vendor receives the money and puts the vehicle in possession of the transferee, the latter is not in a position to use the vehicle in view of section 94 till a fresh policy is obtained. He cannot take the vehicle to his house passing through any public place. When the transferor is liable to pay penalty under section 31 and also liable to be prosecuted under section 112 for not notifying the transfer, we are clearly of the opinion such statutory liability makes him to retain the insurable interest as the liability subsists till he discharges the statutory obligations. When the transferor is liable to pay penalty under section 31 and also liable to be prosecuted under section 112 for not notifying the transfer, we are clearly of the opinion such statutory liability makes him to retain the insurable interest as the liability subsists till he discharges the statutory obligations. We disagree with the view expressed in N. Kanakalakshmi v. R. V. Subba Rao, 1972(1) APU 249 ." (Emphasis supplied) In para 50 of the judgment, it was observed as follows: "The registration of the vehicle in the name of the transferee is not necessary to pass title in the vehicle. Payment of price and delivery of the vehicle makes the transaction complete and the title will pass to the purchaser. When the policy of insurance obtained by the original owner of the vehicle is composite one covering the risk for his person, property (vehicle) and the third party claim on passing of title the transferee cannot enforce his claim in respect of any loss or damage to his person and vehicle unless there is a novation. So far the third party risk is concerned the proprietary interest in the vehicle is not necessary and the public liability continues till the transferor discharges the statutory obligation under sections 29-A and 31 read with section 94 of the Act. Till he complies with the requirement of section 31 of the Act, the public liability will not cease and that constitutes the insurable interest to keep the policy alive in respect of the third party risks are concerned. It must be deemed that the transferor allowed the purchaser to use the vehicle in a public place in the said transitional period and accordingly, till the compliance of section 31, the liability of the transferor subsists and the policy is in operation so farit relates to the third party risks. We answer the second question accordingly." (Emphasis supplied)Madineni Kondaiah's case, 1986 ACJ 1 (AP), was considered in Santosh Rani v. Sheela Rani, 1988 ACJ 299 (Rajasthan) , wherein the reasoning and the ultimate conclusion arrived in Madineni Kondaiah's case (supra) has been approved by a learned single Judge of this court. This decision of the learned single Judge has been upheld by the Division Bench of this court in New India Assurance Company Lid v. Sheela Rani, 1988 ACJ 206 (Rajasthan). 21. This decision of the learned single Judge has been upheld by the Division Bench of this court in New India Assurance Company Lid v. Sheela Rani, 1988 ACJ 206 (Rajasthan). 21. The upshot of the aforesaid discussion is that in claims arising out of the motor accidents where a policy regarding the vehicle involved in the accident is in force, i.e., it could not have lapsed but for the death or bankruptcy of the insured or on account of the transfer of the vehicle by the insured to the third person, the only defences available to the insurance company in such claims are those which are provided by section % (2) of the Motor Vehicles Act. It is a different matter that the insurance company on account of certain terms or exclusion clauses included in the insurance policy can claim reimbursement from the insured or transferor but it cannot take all those defences in a claim petition filed by the injured or in case of his death by his legal representatives. Likewise, in spite of the transfer of the vehicle insured or death or bankruptcy of the insured, the insurable interest survives in the insured unless he discharges the statutory obligations under sections 29-A and 31 read with section 94 of the Motor Vehicles Act so far as the third party risk is involved. So far as this particular case is concerned, I have held above that the appellant as well as respondent Nos. 2 and 3 have failed to prove that this vehicle has been transferred by respondent No. 2 Magharam to the appellant Shankerlal and therefore, even on account of that, the learned lower court should have ordered the payment of the amount of the award in favour of the claimant against respondent Nos. 2 and 3. 22. It was contended by Mr. P.K. Bhansali, learned counsel for respondent No. 3, that the vehicle was not being driven by a licensed driver. This objection has already been taken by respondent No. 3 in reply. No evidence has been led. Moreover, to prove a breach of the condition of the policy, mere admission of the driver is not sufficient. It was contended by Mr. P.K. Bhansali, learned counsel for respondent No. 3, that the vehicle was not being driven by a licensed driver. This objection has already been taken by respondent No. 3 in reply. No evidence has been led. Moreover, to prove a breach of the condition of the policy, mere admission of the driver is not sufficient. The burden of proof to prove the breach of the condition always lay on the insurance company and when the insurance company has failed to prove the breach of the condition of the policy, it cannot take shelter under the admissions contained in the cross-examination of the appellant. In this respect, I place reliance on a decision of this court in Abdul Zabbar v. Ram Swaroop, 1985 ACJ 594 (Rajasthan) . I further place reliance in this respect on a decision of the Gujarat High Court in United India Fire & General Ins. Co. Ltd. v. Hemlata, 1986 ACJ 1085 (Gujarat) . 23. In the result, I partially accept this appeal and modify the award granted by the learned Tribunal on 27.4.1982 to this extent that the amount of award is payable not only by the appellant but also by respondent Nos. 2 and 3. The claimant-respondent No. 1 is entitled to recover the amount of the award from any of these three non-applicants, i.e., appellant and respondent Nos. 2 and 3 jointly and severally. 24. The costs of this appeal will be easy.Appeal partially allowed. *******