Judgment :- 1. MFA Nos.10993/2007, 10990/2007, 10991/2007, 10992/2007 and 9500/2007 are all appeals preferred by the insurance company challenging the fastening of the liability on them in respect of the death of the occupants of a private car. MFA No. 11917/2007 is an appeal filed by the claimant who is respondent in MFA No. 9500/2007 seeking enhancement of compensation. 2. The question involved in all these cases is identical. They are taken up for consideration together and disposed of by this common order. 3. In all these cases, the deceased were occupants in a private car. The owner of the car had taken a policy of insurance as stipulated under Section 146 of the Motor Vehicles Act. 1998 (hereinafter referred to as the Act) i.e. Liability Only Policy’ i.e. the policy under which he sought coverage for third party risk only. 4. In the claim petition, insurance company was made a party. They did not dispute the accident, they also did not dispute the coverage of the vehicle involved in the accident. The specific defence taken was that, they have issued a policy. In terms of the policy they were expected to cover the risk of only third parties. In other words, it is their case that, an occupant in a private car is not a third party. The insured has not paid any additional premium to cover risk of an occupant. Therefore, as the claims are preferred by the legal representatives of the occupants of a private car, the Insurance company is under no obligation to indemnify the insured and pay compensation to the claimants in terms of Section 149 of the Act. The Motor Accident Claims Tribunal without properly appreciating this contention of the insurance company, proceeded on the assumption that, the insurance policy issued covers the risk of an inmate of a car and therefore, insurance company is liable to pay compensation awarded and therefore, it proceeded to pass an award directing the insurance company to pay the amount awarded. Aggrieved by the said award, the insurance company is before this court. 5. The learned counsel for the appellant – insurance company, assailing that portion of the award contends, the insurance policy issued by the insurance company covers the risk of third parties. The occupant of a private car is not a third party as held by the Apex Court. Aggrieved by the said award, the insurance company is before this court. 5. The learned counsel for the appellant – insurance company, assailing that portion of the award contends, the insurance policy issued by the insurance company covers the risk of third parties. The occupant of a private car is not a third party as held by the Apex Court. Therefore, they are not liable to pay the compensation awarded in terms of the award passed by the tribunal. The tribunal committed a serious error in mis-interpreting the terms of the insurance policy and in holding that the insurance policy and in holding that the insurance policy covers the risk of inmate of the car which is factually incorrect and therefore, he contended that, the award of the tribunal in so far as fastening the liability on the insurance company is liable to be set aside. 6. Per contra, learned counsel appearing for the claimants contended the work third party has been defined to mean in includes the Government. The insured being first party, insurance company being the second party, all other persons fall within the phraseology of third party and therefore when once a third party risk is covered as contemplated under Sections 146 and 147 of the Act, the insurance company is liable to answer the claim of the claimants who are the legal heirs of the deceased inmates of the private car. He further submitted, in the judgment relied on by the learned counsel for the insurance company, the Apex Court has not considered the scope of policy as defined in Section 2 of the Tariff for Private Car Regulations and therefore, the judgment of the Apex Court has no application to the facts of this case. He also relies on the terms of the policy, which categorically states the limit of the amount of the company liability under Section (ii)-1(1) in respect of any one accident as per Rules and therefore, he contends the occupant of a private car is a third party and accordingly, the liability foisted by the tribunal is valid and legal and do not call for any interference. 7. In the light of the aforesaid contentions, the point that arises for our consideration in this appeal is as under: Whether an occupant/passenger/inmate of a private car is a third party as defined under Section 145(g) r/w Section 146 of the Act. 8. 7. In the light of the aforesaid contentions, the point that arises for our consideration in this appeal is as under: Whether an occupant/passenger/inmate of a private car is a third party as defined under Section 145(g) r/w Section 146 of the Act. 8. Chapter XI of the Act deals with insurance of motor vehicles against third risk. The word third party has been defined under Section 145(g) of the Act as under: 145(g) third party includes the Government. Section 146 as the heading states deals with necessity for insurance against third party risk. Section 147 of the Act deals with the requirement of the policies and limits of liability and Section 149 deals with the duty of the insurers to satisfy the judgments and awards against persons insured in respect of third party risks. No person shall use except as a passenger or cause or allow any other person to use a motor vehicle in a public place, unless there is any force in relation to the use of the vehicle by that person or that other person, as the case may be a policy of insurance complying with the requirements of this Chapter. Once the insurance policy is issued by a person who is an authorized insurer and policy is issued by a person who is an authorized insurer and such policy is issued insuring persons referred to in subsection (i) of Section 147, then the liability of the insurer is unlimited as far as third party is concerned and in respect of the damage to any property of the concerned party, it is up Rs. 6,000/-. So it is in this context, we have to find out whether an inmate/passenger or an occupant of a private car is a third party. 9. The Apex Court in the case of New India Assurance Co. Ltd vs. Satpalsingh & Ors. reported in 2000 ACJ I SC explaining the meaning of the word third party held as under: “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. Ltd vs. Satpalsingh & Ors. reported in 2000 ACJ I SC explaining the meaning of the word third party held as under: “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-à-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.” 10. However, the said judgment was specifically overruled by subsequent judgment of the Apex Court in the case of New India Assurance Co. Ltd vs. Asha Rani & Ors reported in 2003 ACJ I as under: “It was felt that the decision of the court in New India Assurance Co Ltd vs. Satpal Singh 2000 ACJ and that is how this bunch of appeals had been placed before a three-judge Bench (2001 ACJ 1847) (SC). This in turn necessitates interpretation of the provisions in Section 147 of the Motor Vehicle Act. 1988 (hereafter referred to as the Act) as it stood prior to its amendment in 1994. It may be stated that the provisions of Sections 147 of the Act correspond to Section 95 of the Motor Vehicle Act, 1939. In Mallawwa vs. Oriental Insurance Co. Ltd 1999 ACJ I (SC) while approving the earlier decision of the court in Pushpabai Purshottam Udeshi vs Ranjit Ginning and Pressing Co. 1977 ACJ 343(SC), the court construed the provisions of Section 95(1)(b) of the Motor Vehicle Act, 1939 and held that while the expression any person and the expression every motor vehicle are in wide terms but by proviso (ii) it restricts the generality of the main provision by confining the requirement to cases 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, therefore the vehicle had to be vehicle in which passengers are carried. The court further held that the goods vehicle cannot be held to be a passenger vehicle even if the vehicle was found to be used on some stray occasions for carrying passengers for hire or reward. The court further held that the goods vehicle cannot be held to be a passenger vehicle even if the vehicle was found to be used on some stray occasions for carrying passengers for hire or reward. In Satpals case 2000 ACJ I (SC) court assumed that the provisions of Section 95(1) of Motor Vehicles Act, 1939 are identical with Section 147(1) of the Motor Vehicles Act 1939 as it stood prior to amendment. But a careful scrutiny of the provisions would make it clear that prior to the amendment of 1994 it was not necessary for the insurer to insure against the owner of the goods or his authorized representative being carried in a goods vehicle. On an erroneous impression this court came to the conclusion that the insurer would be liable to pay compensation in respect of the death or bodily injury caused to either the owner of the goods or his authorized representative when being carried in a goods vehicle. On an erroneous impression this court come to the conclusion that the insurer would be liable to pay compensation in respect of the death or bodily injury caused to either the owner of the goods or his authorized representative when being carried in a goods vehicle the accident occurred. If the Motor Vehicles (Amendment) Act of 1994 is examined particularly Section 46 of Act 54 of 1994 by which expression injury to any person in the original Act stood substituted by the expression injury to any person, including owner of the goods or his authorized representative carried in the vehicle the conclusion is irresistible that prior to the aforesaid Amendment Act of 1994, even if widest interpretation is given to the expression to any person it will not cover either the owner of the goods or his authorized representative being carried in the vehicle. The objects and reasons of Section 46 also states that it seeks to amend Section 147 to include owner of the goods or his authorized representative carried in the vehicle for the purposes of liability under the insurance policy. The objects and reasons of Section 46 also states that it seeks to amend Section 147 to include owner of the goods or his authorized representative carried in the vehicle for the purposes of liability under the insurance policy. It is no doubt true that some times the legislature amends the law by way of amplification and clarification of an inherent position which is there in the statute, but a plain meaning being given to the words used in the statue as it stood prior to its amendment of 1994 and as it stands subsequent to its amendment in 1994 and bearing in mind the objects and reasons engrafted in the amended provisions, it is difficult for us to construe that the expression including owner of the goods or his authorized representative carried in the vehicle which was added to the preexisted expression injury I any person is either classification or amplification of the pre-existing statute. On the other hand it clearly demonstrates that the legislature wanted to bring within the sweep of Section 147 and making it compulsory for the insurer to insure even in case of a goods vehicle, the owner of the goods or his authorized representative being carried in a goods vehicle when that vehicle met with an accident and the owner of the goods or his representative either dies or suffers bodily injury.” It is held that the insurer will not be liable for praying compensation to the owner of the goods or his authorized representative on being carried in a goods vehicle when that vehicle meets with an accident and the owner of goods or his representative dies or suffers any bodily injury. 28. An owner of a passenger carrying vehicle must pay premium for covering the risks of the passengers. If a liability other than the limited liability provided for under the Act is to be enhanced under an insurance policy, additional premium is required to be paid. But if the ratio of this court’s decision in New India Assurance Co. Ltd vs. Satpal Singh 2000 ACJ I (SC) is taken its logical conclusion although for such passengers the owner of a goods carried need not take out an insurance policy they would be deemed to have been covered under the policy therefore even no premium is required to be paid. 29. Ltd vs. Satpal Singh 2000 ACJ I (SC) is taken its logical conclusion although for such passengers the owner of a goods carried need not take out an insurance policy they would be deemed to have been covered under the policy therefore even no premium is required to be paid. 29. We may consider the matter from another angle Section 149(2) of the 1988 Act enables the insurers to raise defences against the claim of the claimants. In terms of clause (a)(i)(c) of sub-section (2) of Section 149 of the Act one of the defences which is available to the insurer is that the vehicle in question has been used for a purpose not allowed by the permit under which the vehicle was used. Such a statutory defence available to the insurer would be obliterated in the view of the decision of this court in Satpal Singh’s case, -2000 ACJ I (SC) 11. Following the aforesaid judgment the Apex Court in the case of United India Insurance Co Ltd Shimla vs. Tilak Singh & Ors. reported in AIR 2006 SC 1576 has held as under. 19. The argument that the risk pertaining to a third party would extend to a person other than the parties to the insurance contract was raised in new India Assurance Company vs. Satpal Singh & Ors. (2000) I SCC 237 where after contrasting the language of Section 95(1) of the 1939 Act with the provisions of Section 147(1) of the 1988 Act this court held. The result is that under the new Act an insurance policy covering third party risk is not required to exclude gratuitous passengers in a vehicle no matter that the vehicle is of any type or class. Hence the decisions rendered under the old Act vis-à-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. 20. The view expressed in Satpal Singh’s case (supra) however, has been specifically overruled in the subsequent judgment of a Bench of three judges in New India Assurance Company vs. Asha Rani and others (2003) 2 SCC 223 . In the case of discussion arose in connection with carrying passengers in a goods vehicle. 20. The view expressed in Satpal Singh’s case (supra) however, has been specifically overruled in the subsequent judgment of a Bench of three judges in New India Assurance Company vs. Asha Rani and others (2003) 2 SCC 223 . In the case of discussion arose in connection with carrying passengers in a goods vehicle. This court after referring to the terms of Section 147 of the 1988 Act, as contrasted with Section 95 of the 1939 Act held that the judgment in Satpal singh’s case (supra) had been incorrectly decided and that the insurer will not be liable to pay compensation. In the concurring judgment of Sinha. J., after contrasting the language used in the 1939 Act with that of the 1988 Act, it has been observed (vide paras 25 and 27). 25. Section 147 of 1988 Act inter alia prescribes compulsory coverage against the death of or body injury to any passenger of public service vehicle. Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle would be limited to the liability under the Workmen’s Compensation Act. It does not speak of any passenger in a goods carriage. 27. Furthermore sub-clause (i) of Clause (b) of sub-section (1) of Section 147 speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place, whereas sub-clause (ii) thereof deals with liability which may be incurred by the owner of a vehicle against the death of or bodily injury to any passenger of a public service vehicle cause by or arising out of the use of the vehicle in a public place. 21. In our view although the observation made in Asha Rani’s case (supra) were in connection with carrying passengers in a goods vehicle the same would apply with equal force to gratuitous passengers in any other vehicle also. 21. In our view although the observation made in Asha Rani’s case (supra) were in connection with carrying passengers in a goods vehicle the same would apply with equal force to gratuitous passengers in any other vehicle also. Thus, we must uphold the contention of the appellant-insurance company that it owed no liability towards the injuries suffered by the deceased Rajinder Singh who was a pillion rider as the insurance policy was a statutory policy and hence it did not cover the risk of death of or bodily injury to gratuitous passengers. 12. The Apex Court in the case of Oriental Insurance Co. Ltd vs. Sudhakaran K.V. & Ors, reported in 2008 ACJ 2045 dealing with the obligation of the insurer to indemnify the claim on account of the death of the pillion rider on the scooter after referring to the various judgments of the Apex Court, held as under in para 19: “19. The law which emerges from the said decisions is (i) the liability of the insurance company in a case of this nature is not extented to a pillion rider of the motor vehicle unless the requisite amount of premium is paid for covering his/her risk (ii) the legal obligation arising under Section 147 of the Act cannot be extended to an injury or death of the owner of vehicle or the pillion rider and (iii) the pillion rider on a two wheel was not be treated as a third party when the accident has taken place owing to rash and negligent riding of the scooter and not on the part of the driver of another vehicle. 13. The Apex Court in the case of Dr. T.V. Jose Vs. Chacko P M & Ors. reported in 2001 ACJ 2059 explaining the meaning of the word third party in the context whether it includes a gratuitous passenger in a car held as under: The section does not however require a policy to cover the risk to passengers who are carried for hire or reward. The statutory insurance does not cover injury suffered by occupants of the vehicle who are not carried for hire or reward and the insurer cannot be held liable under the Act. The statutory insurance does not cover injury suffered by occupants of the vehicle who are not carried for hire or reward and the insurer cannot be held liable under the Act. But that does not prevent an insurer from entering into a contract of insurance covering a risk wider than the minimum requirement of the statute whereby the risk to gratuitous passengers could also be covered. In such cases, where the policy is not merely a statutory policy the terms of the policy have to be considered to determine the liability of the insurer. The legal liability is restricted to clause (I) (a) which states that the indemnity is in relation to the legal liability to pay in respect of death of or bodily injury to any person but except so far as is necessary to meet the requirements of Section 95 of the Motor Vehicles Act, the company shall not be liable where such death or injury arises out of and in the course of the employment of such person by the insured. Clauses (I) and (I) (a) are not very clearly worded but the words except so far as is necessary to meet the requirements of Section 95 of the Motor Vehicles Act. 1939 would indicate that the liability is restricted to the liability arising out of the statutory requirements under Section 95. These clauses would themselves indicate that what was intended to be covered under clauses (1) and (1) (a) is the risk required to be covered under Section 95 of the Motor Vehicle Act. In this case only the first sheet of the policy is on record. This clearly shows that the policy is a third party policy. The terms and conditions governing this policy are not on record. What was shown to court was terms and conditions of a comprehensive policy relating to private cars. These cannot apply to this policy. In the absence of terms and conditions governing this policy it is not possible to accept the submission of Mr. Iyer that this policy covered liability to occupants of the car. As has been set out hereinabove, the law on this subject it clear a third party policy does not cover liability to gratuitous passengers who are not carried for hire or reward. The respondent No.8 company will therefore not be liable to reimburse the appellant. 14. Iyer that this policy covered liability to occupants of the car. As has been set out hereinabove, the law on this subject it clear a third party policy does not cover liability to gratuitous passengers who are not carried for hire or reward. The respondent No.8 company will therefore not be liable to reimburse the appellant. 14. From the scheme of Chapter XI, the statutory insurance which is made mandatory is only to protect the interest of third parties. Section 146 deals with necessity for insurance against third party risks. Section 147 deals with the requirement of policies and limits of liability. Sub-clause (i) of Clause (b) of sub-section (1) of Section 147 speaks of liability which may be incurred by the owner of a vehicle in respect of death of or bodily injury to any person of damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. Whereas sub-clause (ii) thereof deals with liability which may be incurred by the owner of a vehicle against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place. Section 2(35) of the Act defines what a public service vehicle means i.e. any motor vehicle used or adopted to be used for the carriage of passengers for hire or reward and includes a maxi cab, a motor cab contract carriage and stage carriage. Proviso appended thereto categorically states that compulsory coverage in respect of drivers and conductors of public service vehicle and employees carried in a goods vehicle however the liability in so far as they are concerned is limited to the liability under the Workmen’s Compensation Act. It does not speak of any passenger in a goods carriage. Therefore it is clear the statutory insurance is confined to the death or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place. 15. Therefore the passenger of a vehicle which is not meant for public service is not covered under this Section. Therefore it is clear the statutory insurance is confined to the death or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place. 15. Therefore the passenger of a vehicle which is not meant for public service is not covered under this Section. The said passenger in the case of a two wheeler is the pillion rider and in the case of three wheeler and four wheeler the occupants of such vehicle who are not carried in the said vehicle for hire or reward. Therefore, the insurance policy taken in respect of a vehicle, in which they are travelling as such passengers are not treated as third parties and such an insurance do not cover the risk of such persons. The reason is Section 147 does not require a policy to cover the risk to passengers who are not carried for hire or reward. The statutory insurance does not cover injuries suffered by occupants of the vehicle who are not carried for hire or reward and the insurer cannot be held liable under the Act. The occupants/passengers/inmates of a private vehicle do not fall within the definition of the word third party. Therefore, the legal obligation arising under Section 147 of the Act cannot be extended to an injury or death of the owner of the vehicle, passengers in such private vehicle or a pillion rider in the case of a two wheeler. Gratuitous passengers who are not carried for hire or reward in a vehicle other than a public service vehicle cannot be construed as third parties. 16. If the risk of an occupant of a car, inmate of a vehicle or passenger in a private car, is to be covered additional premium has to be paid. If no additional premium is paid their risk is not covered. The statutory liability under Sections 146 and 147 of the Act has to be read with the terms of the insurance policy issued under Section 146 of the Act. But that does not prevent an insurer from entering into a contract of insurance covering a risk wider than the minimum requirement of the statute whereby the risk to gratuitous passengers could also be covered. But that does not prevent an insurer from entering into a contract of insurance covering a risk wider than the minimum requirement of the statute whereby the risk to gratuitous passengers could also be covered. A third party policy does not cover liability to gratuitous passengers who are not carried for hire or reward, if a liability other than the limited liability provided for under the Act is to be enhanced under an insurance policy additional premium is required to be paid. The liability is restricted to the liability arising out of the statutory requirement under-Section 14 only. 17. In view of the authoritative pronouncement of the apex Court holding that an occupant/inmate/passenger in a private car is not a third party the finding recorded by the tribunal that the insurance policy issued covers the risk of such persons and therefore the insurance company is liable to pay compensation amount is illegal and contrary to the law declared by the apex court. In fact in the policy no additional premium is received by the insurance company to cover the risk of such persons. It is clear from the terminology used in the policy which fact is not in dispute. In one of the cases additional premium is collected to loading the risk of third party only as is clear from the policy that loading was not meant to cover risk of inmates of a private car and therefore merely because an additional premium is collected under the said policy, it cannot be inferred that the risk of inmates of a car are covered. The words are specific that the loading is done in order to cover only third party risk, it is not a case of additional premium being collected to cover the risk of inmates along with third parties. Therefore, in the facts of this case we are satisfied as the insured has not paid additional premium and the insurance company has not collected any additional premium, the risk of the occupants of a private car was not covered. Therefore, liability foisted on the insurance company cannot be sustained and accordingly, it is hereby set aside. 18. In so far as the appeal for enhancement of compensation in MFA NO.11917/2007 is concerned income of the deceased is taken as Rs. Therefore, liability foisted on the insurance company cannot be sustained and accordingly, it is hereby set aside. 18. In so far as the appeal for enhancement of compensation in MFA NO.11917/2007 is concerned income of the deceased is taken as Rs. 4,000/-she was a spinster therefore 50% of her income was deducted towards her personal expenses taking the age of the claimant mother, correct multiplier of 13 is adopted. In addition to that compensation under the conventional heads is also granted and therefore we do not see any justification for enhancement of compensation at the instance of the claimant. Hence, we do not see any merit in the said appeal also. 19. It was submitted that in MFA NO.9500/2007 the insurance company had already satisfied the award. If that is so insurance company is at liberty to proceed against the owner of the vehicle to recover the said amount. It was also submitted that 50% of the amount is kept in fixed deposit. The said amount shall not be given to the claimants they are entitled to receive periodical interest. The insurance company is entitled to proceed against the owner of the vehicle and to recover the amount which they have paid to the claimants. Only in the event of the insurance company not being able to recover the whole amount from the owner of the vehicle they can then proceed against the claimant and recover the money from the aforesaid deposit. Till they exhaust all their remedies to recover the money from the owner of the vehicle they shall not proceed against the deposit in the name of the claimants. 20. For the aforesaid reasons we pass the following ORDER .(i) MFA No.11917/2007 is dismissed .(ii) All other appeals are allowed and the liability foisted on the insurance company is hereby set aside. The liability on the owner of the vehicle stands (iii) The amount which is deposited by the insurance company at the time of preferring these appeals is ordered to be refunded to the insurance company as they have succeeded in these appeals.