Lingam v. R. Sekhar — 1989 DIGILAW 262 (MAD)

JUDGMENT Padmini Jesudurai, J. 1. The lorry-owner, made liable by the Motor Accidents Claims Tribunal to answer in full the Award, exonerating his insurer, has filed the present appeal contending that the liability ought to have been fastened on his insurer alone. 2. Facts as per the claim briefly are: On 21.7.1979 the first respondent was travelling in a lorry No. MDN. 5868 belonging to the appellant, accompanying a load of fertiliser belonging to his employer, Kunjakshan. The lorry was driven in a rash and negligent manner. It capsized, throwing the first respondent outside, resulting in serious injuries to him. He, therefore, filed M.C.O.P. No. 169 of 1980 under Section 110-A of the Motor Vehicles Act (the Act for short) before the Motor Accidents Claims Tribunal (Principal Subordinate Judge), Coimbatore, claiming a total compensation of Rs. 20,000. 3. The second respondent resisted the claim contending that the vehicle was not driven in a rash and negligent manner and also contending that the first respondent was travelling in the lorry unauthorisedly without the knowledge of the driver and in contravention of Motor Vehicles Rules prohibiting travel in the rear portion of the lorry and as such the liability could not be fastened on it. The claim was also excessive. The appellant adopted the counter filed by the second Respondent. 4. The first respondent examined himself as P.W.1 and examined the Medical Officer, who treated him as P.W.2. Exts.A-1 to A-4 were marked on his side. On behalf of the appellant and the second respondent, the driver of the lorry, Palaniswamy, was examined as R.W.1. No documentary evidence was offered. 5. On the above materials, the Tribunal held that the first respondent was travelling in the lorry, accompanying the fertiliser loads belonging to his employer under instructions from his employer and with the permission of the driver of the lorry. Holding that the accident was due to the vehicle being driven in a rash and negligent manner by R.W.1, the Tribunal assessed the compensation at Rs. 20,000 and following certain decisions of this Court held that, the second respondent, the insurer could not be made to answer the Award. The compensation was made payable by the appellant alone. Aggrieved with this finding, the present appeal has been filed by the owner of the vehicle. 6. 20,000 and following certain decisions of this Court held that, the second respondent, the insurer could not be made to answer the Award. The compensation was made payable by the appellant alone. Aggrieved with this finding, the present appeal has been filed by the owner of the vehicle. 6. Thiru B. Ramamurthy, learned Counsel for the appellant contended that the Tribunal had positively found that the first respondent had travelled under orders from his employer accompanying the goods of his employer and that, since the first respondent's travel was in pursuance to a contract of employment between the owner of the goods and the first respondent, liability ought to have been fastened on the insurer, the second respondent. Learned Counsel placed reliance upon certain decisions of this Court, as well as other High Courts, in support of the above proposition. 7. Per contra, Thiru K. Padmanabhah, learned Counsel for the second respondent contended that the finding arrived at by the Tribunal that the first respondent was travelling under orders from his employer and with the permission of the driver of the lorry, could not be factually sustained. Learned Counsel made a detailed reference to the pleadings as well as the evidence adduced on the side of the first respondent. 8. The factual findings should first be settled. It is contended by the second respondent that the first respondent could not have been travelling in the cabin as contended by him but should have been travelling in the rear portion of the lorry without the knowledge of the driver. This was so, since others who were actually in the cabin had not been injured when the lorry capsized, while the first respondent alone was thrown out of the vehicle and had sustained injuries. R.W. 1 had also given evidence to that effect. I am, however, unable to accept this version put forward by the learned Counsel for the second respondent. It is impossible to accept the theory that without the knowledge of R.W.1, the first respondent could have got into the rear portion of the lorry; particularly when even according to R.W.1 there were others also travelling in the cabin. It would have been impossible for the first respondent to get into the rear portion of the lorry without the knowledge of any one of them and that too in broad day light. It would have been impossible for the first respondent to get into the rear portion of the lorry without the knowledge of any one of them and that too in broad day light. The first respondent should have been travelling only in the cabin of the vehicle and that too with the consent and knowledge of the driver of the vehicle, as the others in the cabin were travelling. 9. It could not also be seriously contended that the first respondent was not accompanying the goods of his employer. Learned Counsel for the second respondent, relying upon Co. 5 of the claim petition filed by the first respondent, wherein as against the column viz., "the address of the employer, if any", the answer is shown as 'nil'., strongly contended that could not have, in any way, been connected with the fertiliser that was being carried in the lorry. Pleadings have to be taken as a whole. In the claim petition in Col. No. 23 details of the accident are mentioned. Therein, it is stated that the first respondent was accompanying the load of manure of Kunjashan of Ketti, Palada. It cannot, therefore, be suggested that the averment that the first respondent was accompanying the load of manure in the lorry, was an afterthought. Nor could the statement of the first respondent he rejected merely because the owner of the fertiliser, Kunjakshan, had not been examined and no document had been produced to show any employment between the employer and the first respondent. The contract of employment, referred to in the Act, need not necessarily be of a long duration or spread over several transactions. It could be a contract even for a single transaction, a contract to perform a single service. If Kunjakshan had paid the first respondent for the service of accompanying his goods in the vehicle, there would then be a contract of employment between Kunjakshan and the first respondent. The tribunal, therefore, had rightly held that the first respondent was accompanying the goods of his employer Kunjashan. 10. It has now to be seen whether the second respondent could be called upon to answer the liability incurred in respect of the first respondent. The provisions of the Act could first be referred to. The tribunal, therefore, had rightly held that the first respondent was accompanying the goods of his employer Kunjashan. 10. It has now to be seen whether the second respondent could be called upon to answer the liability incurred in respect of the first respondent. The provisions of the Act could first be referred to. The relevant portions of Section 95 are as follows: (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which (a) xx xx xx (b) insures the person or classes of persons specified in the policy to the extent specified in Sub-section (2)- Provided that a policy shall not be required- (i) xx xx xx (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 on 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, or xx xx xx A reading of the above provision shows that those who are carried for hire or reward or by reason of or in pursuance of a contract of employment are required to be covered by the policy. Rule 261 of the Tamil Nadu Motor Vehicles Rules, 1940 is as follows: No person shall be carried in the cab of a goods vehicle beyond the number for which there is seating accommodation at the rate of thirty-eight centimetres 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 be carried in any goods vehicle. This shows that even in a goods vehicle a maximum of six persons, besides the driver, could be carried, provided, of course, the seating accommodation at the rate of thirty eight centimetres per passenger, was available in the cabin. Such persons are required to be covered by the policy of insurance. 11. This shows that even in a goods vehicle a maximum of six persons, besides the driver, could be carried, provided, of course, the seating accommodation at the rate of thirty eight centimetres per passenger, was available in the cabin. Such persons are required to be covered by the policy of insurance. 11. Though there is cleavage of opinion as to whether the owners of goods travelling in the goods vehicle along with their goods, are required to be covered under the proviso to Sub-Section (ii) of Section 95(1)(b) of the Act, courts have uniformly held that an employee of the owner of the goods, who travels in the vehicle along with the goods of his employer, in pursuance of a contract of service between him and the owner of the goods, comes within the above provision. As far as this Court is concerned, in Vanguard Insurance Company Ltd. v. Chinnammal 1969 A.C.J. 226, Alagiriswami, J., had held that though on a superficial view of the provisions, it might appear that the words "contract of employment" found in Section 95 of the Motor Vehicle Act would cover only a contract of employment with the owner of the insured vehicle, there has been a preponderance of authority in favour of the other view that it would cover not only such persons but also persons who are on the vehicle in pursuance of a contract of employment with the owner of the goods carried in it. Learned Judge had further held that what was necessary was that for sufficient practical or business reasons the person must be present on the vehicle in pursuance of a contract of employment and if so, he would be covered by the provision. While the above decision was pressed into service on behalf of the owner of the goods carried in the vehicle, Ramanujam, J., in South India Insurance Co. Ltd. v. Subramanium (1971)2 M.L.J. 198 : 84 L.W. 591 41 Com. Cas 986 : A.I.R. 1971 Mad. While the above decision was pressed into service on behalf of the owner of the goods carried in the vehicle, Ramanujam, J., in South India Insurance Co. Ltd. v. Subramanium (1971)2 M.L.J. 198 : 84 L.W. 591 41 Com. Cas 986 : A.I.R. 1971 Mad. 49 : 1972 A.C.J. 439 declined to accept the same and drawing a distinction between an employee of the owner of the goods, which was the case in Vanguard Insurance Company Ltd. v. Chinnammal 1969 A.C.J. 226 and between the owner of the goods himself, which was the case before the learned Judge, held that the owner of the goods, cannot be deemed to be under a contract of employment with himself. Authorities of other High Courts that an employee of the owner of the goods would also be covered by the policy of insurance are not lacking. Suffice it to mention a few of them. (i) United India General Insurance Company Ltd., v. Shantaben Jarambhai Parmar 1983 A.C.J 74); (ii) Partharibai Koran Singh v. Firm Laji shankarlal 1985 A.CJ. 526; (iii) Santra Bai v. Prahlad 1985 A.CJ. 762; (iv) Prafulla Chandra Chowdhry v. Pravakar Sahu 1988 A.C.J. 428. In view of my finding that the first respondent had been travelling in the cabin of the lorry with the knowledge of the driver and applying the legal principles enunciated above, it has to be held that under the Act, the first respondent is required to be covered by the policy and the second respondent is liable to indemnify any liability incurred by the appellant in respect of the first respondent... by virtue of the proviso to Sub-section (ii) of Section 95(1)(b) of the Act. 12. That apart, in the instant case, we also find that the second respondent has not produced the policy of insurance even in this Court. Despite several adjournments taken by the second respondent inability to produce the same was finally expressed. As indicated earlier, the Tamil Nadu Motor Vehicles Rules permit carrying six persons in the cabin subject to availability of seating accommodation. The rule does not impose any limitation regarding the circumstances under which those six could travel. Carrying six persons in the cabin, therefore, in a goods vehicle is not prohibited by the Tamil Nadu Motor Vehicles Rules. As indicated earlier, the Tamil Nadu Motor Vehicles Rules permit carrying six persons in the cabin subject to availability of seating accommodation. The rule does not impose any limitation regarding the circumstances under which those six could travel. Carrying six persons in the cabin, therefore, in a goods vehicle is not prohibited by the Tamil Nadu Motor Vehicles Rules. Though Section 95 requires compulsory coverage for those who are carried for hire or reward or in pursuance of a contract of employment, there could still be persons who might not fall within one of these three categories, but could still be carried on in the cabin of the vehicle, the maximum number being always limited to six. It would, therefore, be open to the owner of a vehicle to contract with his insurer by paying additional premium, requiring the insurer to undertake liability in respect of even those persons who may not come within the categories of persons carried for hire, reward or in respect of in pursuance of a contract of employment. That it is open to the owner of a vehicle to take policies covering risks which are not covered by the requirements of Section 95 of the Act or cover a higher risk than the amount provided for in that section, has been made clear by the Supreme Court in Pushpabai Purushottam Udeshiv v. Ranji Ginning and Pressing Co. 1977 A.C.J. 343. In National Insurance Co. Ltd., v. Jugal Kishore 1988 A.CJ. 270, the Supreme Court, while depreciating the attitude often adopted by the Insurance Companies of not filing a copy of the policy of insurance either before the Tribunal or at least before the High Court, has emphasised that, when the Insurance company wishes to take a defence in a claim petition that its liability is not in excess of the statutory liability, it should file a copy of the insurance policy along with its defence. In the instant case where the second respondent has not filed the policy of insurance, it would not be open to it to contend that the policy is only an "Act only policy". Even on this ground, the second respondent has to fail. 13. In the result, the appeal is allowed and the compensation of Rs. In the instant case where the second respondent has not filed the policy of insurance, it would not be open to it to contend that the policy is only an "Act only policy". Even on this ground, the second respondent has to fail. 13. In the result, the appeal is allowed and the compensation of Rs. 20,000 awarded by the Tribunal shall be paid by the second respondent initially, together with interest at 6% p.a. from the date of the filing of the claim petition (26.6.1980) till the date of deposit. No costs.