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2000 DIGILAW 956 (AP)

Andhavarapu Kamaraju v. Chintada Savitramma

2000-12-19

BILAL NAZKI, V.ESWARAIAH

body2000
NAZKI, J. ( 1 ) A short point is involved in all these appeals which are being disposed of by this common order. Facts are admitted. An accident occurred on 8. 12. 1990 at about 3. 30 p. m. Some students were travelling in the lorry. Some of them died and some of them received injuries. Claims were filed which were allowed. Appeals being A. A. O. Nos. 1528, 1581, 1529 and 1538 of 1997 were filed by the owner of the vehicle and appeals A. A. O. Nos. 1825, 1922, 1974 and 2267 of 1997 were filed by the insurance company. These appeals were heard by the learned single Judge and he disposed them of by a common order. This order is challenged by way of these letters Patent Appeals by the owner of the vehicle. ( 2 ) THE case of the insurance company who filed the appeals before the learned single Judge was that the passengers were gratuitous and the vehicle had been used contrary to the terms of the contract therefore they were not liable. The Tribunal had held the insurance company liable to the extent of Rs. 25,000. The learned single judge relying on various judgments of this high Court and of the Supreme Court allowed the appeals filed by the insurance company, i. e. , A. A. O. Nos. 1825, 1922, 1974 and 2267 of 1997 and set aside the award fastening the liability of payment of Rs. 25,000 under no fault liability and directed the owner to pay the full compensation amount. The appeals filed by the owner of the vehicle were dismissed. Against this order the present appeals have been filed. ( 3 ) THE learned counsel for the appellant submits that although there was some confusion earlier with regard to the liability of the insurance company with respect to gratuitous passengers it has now been settled by the Apex Court in a latest judgment and the insurance company under new Motor vehicles Act is liable to pay compensation in full even with respect to gratuitous passengers. He submits that the judgments referred by the learned single Judge should not have been relied upon in view of the latest judgment of the Apex Court in New india Assurance Co. Ltd. v. Satpal Singh, 2000 ACJ 1 (SC ). He submits that the judgments referred by the learned single Judge should not have been relied upon in view of the latest judgment of the Apex Court in New india Assurance Co. Ltd. v. Satpal Singh, 2000 ACJ 1 (SC ). In this judgment the supreme Court considered the impact of the earlier judgments which were relied upon by the learned single Judge, namely, mallawwa v. Oriental Insurance Co. Ltd. , 1999 ACJ 1 (SC ). ( 4 ) THE facts in this case are not at dispute. Some students had taken a truck and were travelling in the truck when it fell into a ditch and turned turtle killing some of the students and causing injuries to some of the students. While considering the impact of Mallawwa s judgment, 1999 acj 1 (SC), the Supreme Court in para 5 of Satpal Singh s case, 2000 ACJ 1 (SC), held:" (5) Learned counsel for the appellant banked on the decision of a three-Judge bench of this court in Mallawwa v. Oriental Insurance Co. Ltd. , 1999 ACJ 1 (SC), to disclaim the liability on the premise that the victim of the accident was gratuitous passenger in the vehicle covered by the insurance policy. But the said decision was rendered under section 95 of the Motor Vehicles Act, 1939 (which can be referred to as the old act ). . . "after considering the impact of section 95 of the old Act (Motor Vehicles Act, 1939) the court was of the view that Mallawwa s judgment was correct as far as applicability of the old Act was concerned. In the present case the accident had taken place in the year 1990 which is much after coming into force of the new Act (59 of 1988) therefore the liability of the insurance company has to be seen under section 147 of the new Act which corresponds to section 95 of the old Act. The Apex Court even in mallawwa s case had pointed out that the old Act had been repealed and the new section 147 has substantially altered the legal position and, therefore, the interpretations given to section 95 of the old Act in Mallawwa s case would only operate where the cases were governed by the old act. The Apex Court even in mallawwa s case had pointed out that the old Act had been repealed and the new section 147 has substantially altered the legal position and, therefore, the interpretations given to section 95 of the old Act in Mallawwa s case would only operate where the cases were governed by the old act. While coming to section 147 of the new Act the Supreme Court found that, under sub-section (2) of section 147 there was no limitation for the insurer regarding the amount of compensation to be awarded in respect of death or bodily injury of the victim of the accident and even the limits which were prescribed under the old Act have been removed. The Supreme Court after considering the impact of section 147 held (para 10):"the result is that under the new Act an insurance policy covering third party risk is not required to exclude gratuitous passenger in a vehicle, no matter that the vehicle is of any type or class. Hence the decisions rendered under the old Act vis-a-vis gratuitous passengers are of no avail while considering the liability of the insurance company in respect of any accident which occurred or would occur after the new Act came into force. "therefore, this judgment makes it clear that even for gratuitous passengers in any type of vehicle the insurance company cannot disclaim its liability. The learned counsel for the respondents has also relied on a judgment in Oriental Insurance Co. Ltd. v. Sunita Rathi, 1998 ACJ 121 (SC), but we do not find that the judgment is relevant for the purposes of the present case particularly in view of judgment in satpal Singh s case (supra ). ( 5 ) AS a result the appeals filed by the owner before the learned single Judge are allowed and appeals filed by the insurance company stand dismissed. These L. P. As. are also eventually allowed. The award passed by the Tribunal is modified to the extent that the insurance company and the owner shall jointly and severally be liable to pay the whole compensation amount to the claimants. L. P. As. allowed.