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2002 DIGILAW 208 (ORI)

NATIONAL ALUMINIUM COMPANY v. DANAMATI MALI

2002-04-06

A.S.NAIDU

body2002
JUDGMENT : A.S. Naidu, J. - National Aluminium Company ('NALCO' for short), the owner of the offending bus, has preferred this appeal u/s 173 of the Motor Vehicles Act, inter alia challenging the judgment and award dated 21 st May, 1996 passed by the Second Motor Accident Claims Tribunal (S.D.), Berhampur in M.J.C. No. 139 of 1989. 2. The dispute has a chequered career, in as much as this is the second Miscellaneous Appeal filed before this Court. Bereft of unnecessary details, the short facts which are necessary for effectual adjudication are stated hereinbelow : Admittedly the accident took place on 8th June, 1989 causing death of one Bolu Mali who was working as a mason at Damanjodi, NALCO Township. The deceased was hit by the offending vehicle bearing No. ORK 8619 belonging to NALCO and succumbed to the injuries. The widow and minor son of the deceased filed application u/s 110-A the Motor Vehicles Act, 1939 claiming Rs. 2,00,000.00 (Two Lakhs) as compensation. The Tribunal by a well-discussed judgment dated 2nd June, 1992 awarded a sum of Rs. 1,35,000.00 as compensation against the Insurance Company. Being aggrieved by the said award, the United Insurance Company Limited preferred Miscellaneous Appeal No. 359 of 1992 in this Court on the sole ground that in accordance with the provisions of the Motor Vehicles Act, 1939, which Act was in vogue at the relevant time, the limited liability of the Insurance Company, in consonance with Section 95(2)(b)(i) of the Motor Vehicles Act, 1939 was only Rs. 50,000.00 (Fifty Thousand) towards third-party risk. This Court remanded the case to the Tribunal with the following direction .- "The Tribunal is directed to re-hear the question regarding the liability of the Insurance Co. and that of the owner giving them (owner and Insurance Co.) opportunity to adduce evidence on the said question." 3. It is an admitted fact that the vehicle in question was being used by NALCO for transporting its employees, and on the date in question the vehicle hit the pedestrian who succumbed to the injuries. 4. After remand, the matter was once again heard by the learned Tribunal in extenso. The NALCO examined one witness and the Insurance Company examined two witnesses. The sole contention of the NALCO was that proviso (ii) to Section 95(1) is not applicable and the case is covered u/s 95(2)(c) of the Motor Vehicles Act. 5. 4. After remand, the matter was once again heard by the learned Tribunal in extenso. The NALCO examined one witness and the Insurance Company examined two witnesses. The sole contention of the NALCO was that proviso (ii) to Section 95(1) is not applicable and the case is covered u/s 95(2)(c) of the Motor Vehicles Act. 5. At the other hand, the contention of the Insurance Company was that the vehicle was covered squarely under proviso (ii) to Section 95(1) and the liability of the Insurance Company was limited only to Rs. 50,000.00 (Fifty Thousand). 6. The learned Tribunal, after careful consideration of the evidence on record, both oral and documentary, and relying upon the evidence of D.W. 2 and the Insurance Policy (Ext. A), held that the liability of the Insurance Company was governed u/s 95(1)(b)(ii) of the Motor Vehicles Act, 1939 and the liability cannot exceed Rs. 50,000.00. The learned Tribunal, therefore, directed the Insurance Company to pay a sum of Rs. 50,000.00 towards compensation and NALCO, the owner of the offending bus, to pay the balance sum of Rs. 85,000,00 to the claimants. 7. The only question which needs to be determined in the present case is as to whether the offending bus which was admittedly used for transporting the employees of NALCO is covered under proviso (ii) to Section 95(1) or u/s 95(2)(c) of the Motor Vehicles Act, 1939 (old Act). 8. It is no longer res Integra that the liability of the Insurance Company could be either statutory or contractual. A statutory liability cannot be more than what is stipulated under the Statute. However, there is nothing in Section 95 of the M. v. Act prohibiting the parties from contracting to create unlimited or higher lability to cover wider risk. In such an event, the Insurance Company is bound by the terms of the Contract as specified in the Policy, in regard to unlimited or higher liability as the case may be. In the absence of specific clause in the Policy pursuant to a contract of insurance, a limited statutory liability cannot be expanded to make it unlimited or higher. If it is so done, it amounts to re-writing the statute or the contract of insurance which is not permissible. In the absence of specific clause in the Policy pursuant to a contract of insurance, a limited statutory liability cannot be expanded to make it unlimited or higher. If it is so done, it amounts to re-writing the statute or the contract of insurance which is not permissible. The Courts, while adjudicating the disputes, have to keep strict vigil of the aforesaid principle as has been observed in the case of New India Assurance Co. Ltd. Vs. C.M. Jaya and Others, 9. Admittedly the accident took place on June 8, 1989. On the said date, the old Motor Vehicles Act of 1939 was in vogue. The amended Motor Vehicles Act of 1988 came into force with effect from July 1st, 1989. Thus, the case in hand is covered under the provisions of the 1939 Act. Section 95 of the 1939 Act restricts the liability of the Insurance Company, Sub-section (1) of Section 95 categorically provides that the terms and conditions stipulated in the Insurance Policy will give coverage to the persons or classes of persons, specified in the Policy, to the extent of Sub-section (2), against any liability which may incur by the Insured, Sub-section (2), of Section 95 of the 1939 also clearly quantifies the liability of the Insurance Company, so far as compensation is concerned, with regard to third party, and the number employees in a goods vehicle who were otherwise entitled to get compensation. On the other hand, Sub-section(2)(b)(i) of Section 95 clearly provides that where the vehicle is used for passenger service for hire or reward, or by reasons of or in pursuance of a contract of employment, the limit of liability of the Insurance Company for persons other than passengers is limited to Rs. 50,000.00 only and so far as passengers are concerned, in consonance with Section 95(2)(b)(ii), the liability of the Insurance Company is restricted to Rs. 15,000.00 only. 10. Admittedly, the offending vehicle was a bus which was used for carrying passengers either on hire or reward, or in pursuance of the contract of employment. Thus, the vehicle is not covered nor does it satisfy the criteria specified in Section 95(2)(c) of the old Act. 11. Learned counsel for the appellant tried his best to convince me that the vehicle comes within the category specified in Section 95(2)(c) of the Motor Vehicles Act, 1939. Thus, the vehicle is not covered nor does it satisfy the criteria specified in Section 95(2)(c) of the old Act. 11. Learned counsel for the appellant tried his best to convince me that the vehicle comes within the category specified in Section 95(2)(c) of the Motor Vehicles Act, 1939. but then admittedly the vehicle was a bus meant to carry passengers or persons in pursuance of the contract of employment on hire or for reward. Keeping in view the definition of Section 95(2)(c) of the 1939 Act, I fail to be convinced. The Policy (Ext. A) clearly reveals that the liability of the Insurance Company is limited to Rs. 50,000.00. In view of proviso (ii) to Section 95(1), coupled with the contractual obligations flowing out of Ext. A, I have no hesitation to agree with the finding arrived at by the learned Tribunal to the effect that the offending bus was covered under the category mentioned in Section 95(1), and not u/s 95(2)(c) of the 1939 Act. Thus the liability of the Insurance Company in the present case, is limited to Rs. 50,000.00 only. The view taken by me also gets fortified from the decisions in Akhaya Kumar Sahoo Vs. Chhabirani Seth and Another, and United India Insurance Co. Ltd. Vs. Haramani Das and Others, where it has been categorically held that the liability of the Insurance Company would be limited to Rs. 50,000.00 only in respect of a third party. 12. Thus the Miscellaneous Appeal has no merit and is, accordingly, dismissed. The impugned award of the Tribunal is confirmed. Parties to bear their respective costs. Final Result : Dismissed