Judgment :- 1. On 19.8.1989 at about 14.00 hrs. an accident had taken place near Kattakulam Sholavandan, Madurai District. The van bearing Registration No. TA.U.5573 in which the first respondent in C.R.P. No. 574 of 1993, the first respondent in C.M.A. No. 84 of 1993 and the husband of the first respondent in C.M.A. No. 83/1993 travelled, was involved in the accident. 2. According to the first respondent in C.M.A. No. 84 of 1993, he was employed by one Kamatchi, son of Chelliah Nadar, to load and unload tamarind bundles from Palamedu to Chekkanurani and to assist him in the market at Chekkanurani. The said van was proceeding from Palamedu to Chekkanurani with 48 tamarind bundles and the first respondent was travelling in the said vehicle, for the safety of the articles as employed by the said Kamatchi, the owner of the goods. The driver of the said vehicle was driving the van in a rash and negligent manner without observing the traffic rules. So, it was involved in the accident. The first respondents left side hip bone was fractured and so he was not able to walk, run or to do any other work. On that basis be claimed a compensation of Rs. 50,000/- with interest at 12% by filing MCOP No. 308 of 1990 on the file of the Motor Accidents Claims Tribunal, Madurai. The appellant/insurance company filed an objection denying the fact that the claimant was employed by one Kamatchi to load and unload tamarind bundles and he travelled in the said van in that capacity. It is also denied that the driver of the said vehicle was driving the vehicle in a rash and negligent manner. It is further stated that the vehicle is a goods vehicle entitled to carry goods alone and not the passengers and so the insured violated the terms and conditions and so the insurance company is not liable to pay the said compensation to the first respondent. They have disputed the quantum of compensation claimed by the first respondent. 3. The first respondent in C.R.P. No. 574 of 1993 filed the claim petition on the ground that he was travelling in the said van. He was working as a labourer in building construction. They have disputed the quantum of compensation claimed by the first respondent. 3. The first respondent in C.R.P. No. 574 of 1993 filed the claim petition on the ground that he was travelling in the said van. He was working as a labourer in building construction. According to him, the petitioner/insurance company is liable to pay the compensation to the first respondent for the negligent act of the driver in the course of his employment under the first respondent in the said M.C.O.P., and the second respondent therein is also liable to pay the compensation to the first respondent herein, as the insurer as well as the indemnifier. He claimed a compensation of Rs. 30,000/- by filing the claim petition in M.C.O.P. No. 651 of 1991. 4. The respondents 1 to 5 in C.M.A. No. 83 of 1993 filed the claim petition in A.C.O.P. No. 55 of 1992 on the file of the IV Additional Sub-Judge/Motor Accidents Claims Tribunal, Madurai stating that they are the legal representatives of the deceased Ayyavu, who travelled in the said van and died due to the accident. The claimant has further stated that Ayyavu travelled in the said van as a loadman and so they are entitled for compensation, and the second respondent herein is also liable to indemnify the payment of the said compensation of Rs. 1,50,000/-. On the basis of the abovesaid fact and pleadings, the claim petition was resisted by the appellant before the said Tribunal by taking the same defence as that of the one M.A.C.O.P. No. 308 of 1990. 5. The Court below in its order dated 11.8.1992 granted compensation of Rs. 21,500/-plus interest at the rate of 12% to the first respondent in CM. A. No. 84 of 1993, a sum of Rs. 3,000/- with interest at 12% for the first respondent in C.R.P. No. 574 of 1993, and a sum of Rs. 92,000/- plus interest at 12% for the respondents 1 to 5 in CMA. No. 83 of 1993 Aggrieved against the same, the Insurance Company has filed the above revision and the appeals. 6. 3,000/- with interest at 12% for the first respondent in C.R.P. No. 574 of 1993, and a sum of Rs. 92,000/- plus interest at 12% for the respondents 1 to 5 in CMA. No. 83 of 1993 Aggrieved against the same, the Insurance Company has filed the above revision and the appeals. 6. According to the learned counsel appearing for the insurance Company, the claimants and the deceased were travelling in the said vehicle without any authorisation from the owner of the vehicle and the driver is not authorised to take passengers and so the insurance policy did not permit to carry as such, and there was gross violation of the permit conditions and therefore the Insurance Company is not liable, ass per the Act, and the terms and conditions of the insurance policy. 7. The question that has to be decided in this case is whether the persons who travelled in the said vehicle are authorised passengers, and the Insurance company is liable to indemnify the insured in respect of the compensation claimed. 8. In so far as the claimant in C.M.A. No. 84 of 1993 is concerned, he examined himself as P.W.2. According to him, he accompanied the goods of one Kamatchi, the owner of the goods. R.W.1 has deposed that he does not know anybody, who travelled in the van, and nobody was permitted to travel by getting charges. R.W.2, the driver of the said vehicle has also deposed that one Ayyavu, and Adhimurthi were permitted to travel as loadmen. He has also stated in his chief examination that no permission is granted to take passengers. He has also stated about the claimant in M.C.O.P No. 308 of 1990. According to him, the claimant travelled along with the goods of one Kamatchi. The claimant in MCOP No. 651 of 1991 examined himself as P.W.4. He has deposed that he travelled in the said van as a loadman at the request of the driver. That has been admitted by the driver as R.W.2. The deceased in CM. A. No. 83 of 1993 was also engaged as a loadman, even according to R.W.2. the driver. 9. He has deposed that he travelled in the said van as a loadman at the request of the driver. That has been admitted by the driver as R.W.2. The deceased in CM. A. No. 83 of 1993 was also engaged as a loadman, even according to R.W.2. the driver. 9. On the basis of the abovesaid pleadings and evidence, the learned counsel appearing for the Insurance Company has submitted that in view of the decision in Kanniappa Nadar v. Jayapandi & 10 others (1997 - I-L.W. 174), the Insurance Company is not liable for payment of any compensation as held by the Tribunal. Since the learned counsel has solely relied on the decision of the Division Bench cited supra, it is necessary for me to consider about the scope of the said decision. In the said decision the claimants were travelling in a lorry with the paddy bags and in the accident that took place some persons lost their lives and other sustained injuries. The legal representatives of the deceased persons claimed various amounts as compensation alleging that the lorry involved in the accident was driven rashly and negligently by its driver and that has caused the accident and therefore, the compensation should be awarded to them. The owner of the vehicle has pleaded that he was not liable for payment of any compensation. The Insurance Company also contested the same stating that the persons accompanying the goods were not covered under the terms of the policy issued by the insurance company and therefore the company was not liable to pay any compensation. The Tribunal found that the persons who travelled in the lorry had sustained injuries or lost their lives have not been established to have travelled on payment of hire charge and that they were in the lorry only for the purpose of safeguarding their paddy bags and for loading and unloading purposes. In the view so taken, the Tribunal fastened liability on the insurance company for payment of compensation to the claimants. In the view so taken, the Tribunal fastened liability on the insurance company for payment of compensation to the claimants. Aggrieved against the said award, the insurance company filed appeals and mainly contended that the permit in respect of the lorry did not permit carrying of passengers in the goods vehicle and there was gross violation of the permit conditions and therefore the insurance company was not liable as per the Act and the terms and conditions of the insurance policy Accepting this arguments made on behalf of the insurance company, the learned single judge allowed the appeals and directed the owner of the lorry to pay the amount. Aggrieved against the judgment of the learned single Judge the owner of the vehicle preferred Letters Patent Appeals before the Division Bench. Before the Bench, contention was raised on behalf of the owner of the vehicle that the learned single judge has not appreciated that mere breach of the exclusion clause in the policy does not absolve the liability and the onus is on the insurer to establish that the insured himself is guilty of committing the breach of contract of insurance and the learned Judge ought to have held that the immunity sought under S. 96(2)(B)(ii) of the Act was not available to the insurance company in respect of the issue governing the claim in question. It was further argued that there can be no breach of violation of the promise on the part of the insured so as to enable the insurer to take shelter under the umbrella of the exclusion clause and when the insured had not committed any wilful infringement or violation of the terms and conditions of the policy and unless it is established that the insured was at fault and was guilty of a breach, the insurer cannot escape from its obligation to indemnify the insured. After considering the arguments, the Division Bench has held as follows:— “In our opinion, the principles laid down by the Supreme Court in the aforesaid Schan Lal Passis case would squarely apply to the case on hand. In the instant case, the owner of the vehicle had appointed the licensed driver to the vehicle and the accident-in-question as taken place when the vehicle was transporting goods. In the instant case, the owner of the vehicle had appointed the licensed driver to the vehicle and the accident-in-question as taken place when the vehicle was transporting goods. There is no evidence adduced by the insurer that the owner of the vehicle authorised or permitted the owners of the goods which was being transported in the vehicle at the time of the accident, to travel in the transport vehicle-in-question, nor is, there any evidence to show that the driver was authorised to carry the owners of the goods along with the goods in the transport vehicle in question. There is no evidence to infer that there was even an implied consent for doing it by the owner of the vehicle. There is also no evidence to show that with the knowledge of the owner of the vehicle the owners of the goods were taken along with the goods in the vehicle. Further, it is also not proved that they are the gratuitous passengers. Then, this is a case in which the driver on his own accord appears to have allowed the owners of the goods to travel in the transport vehicle along with their goods. There is no evidence to show that the owner of the vehicle wilfully allowed the transport vehicle in question to be used for the purpose which was not allowed by the permit. S. 96 (2)(b)(i)(c) provides thus:— 96.(2)0 No sum shall be payable by an insurer under Sub-Section (1) in respect of any judgment unless, before or after the commencement of the proceedings in which the judgment is given, the insurer had notice through the Court of the bringing of the proceedings, or in respect of any judgment so long as execution is stayed thereon pending an appeal and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely; a.. b. that there has been a breach of specified condition of the policy being one of the following conditions, namely; i. . a. . b. . c. for a purpose not allowed by the permit; under which the vehicle is used, where the vehicle is a transport vehicle”. b. that there has been a breach of specified condition of the policy being one of the following conditions, namely; i. . a. . b. . c. for a purpose not allowed by the permit; under which the vehicle is used, where the vehicle is a transport vehicle”. Sohan Lal Passis case was referred to a three judge bench, in the light of the stand taken by the Insurance Company that when S. 96(2)(b)(ii) has provided that the insurer shall be entitled to defend the action on the ground that there has been breach of a specified condition to the policy it viz , the vehicle should not be driven by a person who is not duly licensed, the insurance company cannot be held to be liable to indemnify the owner of the vehicle. On this point the view taken in Skandia Insurance Co. Ltd. (1987) 2 SCC 654 =100 L.W. 75) was against the insurer. The relevant portion of the judgment in Skandia Insurance Co. Ltd.‘s case is as follows:— “The defence built on the exclusion clause cannot succeed for three reasons, viz. 1. On a true interpretation of the relevant clause which interpretation is at peace with the conscience of S. 6, the condition excluding driving by a person not duly licensed is not absolute and the promisor is, absolved once it is shown that he has done everything in his power to keep, honour and fulfil the promise and he himself is not guilty of a deliberate breach. 2. Even if it is treated as an absolute promise,, there is substantial compliance therewith upon an expressor implied mandate being given to the licensed driver not to allow the vehicle to be left unattended to that it happens to be driven by an unlicensed driver. 3. The exclusion clause has to be ‘read down’ in order that it is not at war with the ‘main purpose’ of the provisions enacted for: the protection of victims of accidents so that the promisor is exculpated when he does everything in his power to keep the promise. 3. The exclusion clause has to be ‘read down’ in order that it is not at war with the ‘main purpose’ of the provisions enacted for: the protection of victims of accidents so that the promisor is exculpated when he does everything in his power to keep the promise. It was to examine the correctness of the aforesaid view as pointed out above, the Sohan Lal Passs case was referred to a larger Bench of three judges, in which it was held thus:— “According to us, S. 96(2)(b)(ii) should not be interpreted in a technical manner, Sub-Section (2) of S. 96 only enables the insurance company to defend itself in respect of the liability to pay compensation on any of the grounds mentioned in Sub-Section (2) including that there has been a contravention of the condition excluding the vehicle being driven by any person who is not duly licensed. This bar on the facts of it operates on the person insured. If the person who has got the vehicle insured has allowed the vehicle to be driven by a person who is not duly licensed when only that clause shall be attracted. In a case where the person who has got insured the vehicle with the insurance company, has appointed a duly licensed driver and if the accident takes place when the vehicle is being driven by a person not duly licensed on the basis of the authority of the driver duly authorised to drive the vehicle whether the insurance company in that event shall be absolved from its liability? The expression ‘breach’ occurring in S. 96(2)(b) means infringement or violation of a promise or obligation. As such the insurance company will have to establish that the insured was guilty of an infringement or violation of a promise. The Insurer has also to satisfy the Tribunal or the Court that such violation or infringement on the part of the insured was wilful. As such the insurance company will have to establish that the insured was guilty of an infringement or violation of a promise. The Insurer has also to satisfy the Tribunal or the Court that such violation or infringement on the part of the insured was wilful. If the insured has taken all precautions by appointing a duly licensed driver to drive the vehicle in question and it has not been established that it was the insured who allowed the vehicle to be driven by a person not duly licensed, then the insurance company cannot repudiate its statutory liability under its statutory liability under Sub-Section (1) of S. 96.Therefore, It is clear from the rule laid down in Solum Lal Passis case that the burden of proving the breach of condition of permit or the contract of insurance by the insured is on the insurer, viz., the insurance company. In the instant case, that burden has not been discharged. Therefore, the Insurance Company cannot absolve from its liability to pay the compensation to the claimants. In the view we take, the contention of the learned counsel for the Insurance Company based on the exclusive clause contained in the contract of insurance has fail. It is accordingly rejected, what is said about the appeals will also apply to the C.R.P. 2655 of 1990-in-question”. 10. Since the insurance company has not discharged its burden of establishing that the insured himself is guilty of committing breach of contract of insurance, the insurance company cannot absolve its liability from paying the compensation. Even in the present case there is no evidence adduced by the insurer that the owner of the vehicle wilfully authorised or permitted the owner of the goods which were being transported in the vehicle at the time of accident, nor is there any evidence to show that the driver was authorised to carry the owner of the goods along with the goods, and others to travel in the vehicle in question. In the absence of any such evidence, as held by the Division Bench of this Court, the insurance company cannot absolve its liability from paying the compensation to the claimants. 11. In view of the above, I do not find any merits in the revision and the appeals, and thereby they are dismissed. No costs. Consequently, C.M.P. Nos. 11170, 1171 of 1993, & 7086 of 1996 in CM.As. 11. In view of the above, I do not find any merits in the revision and the appeals, and thereby they are dismissed. No costs. Consequently, C.M.P. Nos. 11170, 1171 of 1993, & 7086 of 1996 in CM.As. 83 and 84 of 1993 are closed.