JUDGMENT :- 1. Appeal filed against the judgment and decree dated 8.5.2003 made in MACTOP No.276 of 1998 on the file of the Motor Accidents Claims Tribunal (Addl District and Sessions Judge – Fast Track Court No.III), Coimbatore. The Insurance Company is the appellant. The brief facts of the case is as follows: The respondents 1 to 3 filed a claim petition before the Motor Accidents Claim Tribunal, Coimbatore claiming a total compensation of Rs.18,00,000/- for the death of one Rupan, husband of the 1st respondent and father of the respondents 2 and 3. According to the claimants, on 1.6.1997, the said Rupan was travelling in an Ambassador car bearing Registration NO.TNJ 7936 along with his relatives from Vellore to Gobichettipalayam. The vehicle was driven by the 4th respondent and it belonged to the 5th respondent. It is also insured with the appellant. Around 6.30 a.m, when the car was nearing Mathanur, it hit against a parked lorry bearing Regn No.HR 29B5240, owned by the 6th respondent. The deceased was working as Assistant at the office of the District Police, Coimbatore and he was earning a sum of Rs.4850 and aged 42 years at the time of accident. The appellant filed a counter inter-alia stating that the car was insured with them as a private vehicle and the Insurance Policy is an Act policy. The appellant contended that the deceased had travelled in the car as a passanger and the car was also used for a hire and reward and therefore, the insurance company is not liable. However, the learned MOCOP Tribunal, Coimbatore found that the accident had occurred due to rash and negligent act of the 4th respondent/driver. While considering the issue whether the appellant is liable, the Tribunal held that the deceased is a third party and therefore, the Insurance Company is liable to satisfy the claim. A sum of Rs.5,04,000/-was awarded and the appellant as well as the insured were directed to satisfy the claim with 9% interest. Aggrieved by the fastening of the liability of the Insurance Company, the present appeal has been filed. Mr.P.G. Padmanabhan, the learned counsel for the appellant would contend that the finding of the Tribunal that the deceased was the third party was erroneous. Aggrieved by the fastening of the liability of the Insurance Company, the present appeal has been filed. Mr.P.G. Padmanabhan, the learned counsel for the appellant would contend that the finding of the Tribunal that the deceased was the third party was erroneous. The learned counsel pointed out that it is an admitted case that a private car was used for hire and the deceased was a passanger and there is no coverage for the passanger. The learned counsel also pointed out that the Insurance policy is also a third part act policy which will not cover even the passenger in a private car. Tehl earned counsel relied on a decision reported in 2006 ACJ 1441 (United India Insurance Co Ltd vs Tilak Singh and others), wherein the Apex court has held as follows: para21 “In our view, although the observations made in Asha Rani's case, 2003 ACJ 1 (SC), 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 didn’t cover the risk of death of or bodily injury to gratuitous passenger”. He also relied on a decision reported in 2009 2 MLJ 963 (Royal Sundaram Alliance Insurance Co Ltd Coimbatore vs A. Meenakshi and Others), wherein, the Division Bench of this Court laid down the following Rationes decidendi: “RATIONES DECIDENDI I. The liability of insurer to a gratuitous passenger will depend on the insurance policy that has been taken. A Comprehensive Policy covers the risk of a gratuitous passenger to the extent of the liability incurred. As such, when the Policy is a Package Comprehensive Policy covering the risk of death or injury of any occupant and when that is the contract to which the parties have bound themselves and when there is no limit imposed on the insurer's liability, the Insurance Company cannot evade its duty to pay the compensation and the relief cannot be denied to a third part occupant in a car covered by such Comprehensive Policy. II. II. The law governing the insurance policy ultimately is a law of contract and so both parties should understand exactly what are the terms of the contract and for exactly what extent and what type of coverage the policy holder is paying premium III. While deciding the claim petition, the Tribunal should examine the terms of the Policy produced by the insurer, and in the event of denial of liability, a finding should be rendered with regard to the nature of the Policy as to whether it was an Act Policy or a Package policy” He also relied on a decision reported in 2009 1 CTC 1 (Branch Manager, United India Insurance Co Ltd, Branch Office, Nethaji Bye Pass Road, dharmapuri Town vs Nagammal and 2 others), wherein, the Full Bench of this Court took up the issue whether the Insurer can be directed to pay compensation to the claimant in a case where the deceased and/or the injured was travelling as a gratuitous passenger in a goods vehicle and recover the same thereafter from the owner of such goods vehicle and laid down para31 “31. Thus from an analysis of the statutory provisions as explained by the Supreme Court in various decisions rendered from time to time, the following picture emerges: (i) The Insurance Policy is required to cover the liability envisaged under Section 147, but wider risk can always be undertaken. (ii) Section 149 envisages the defences which are open to the Insurance Company. Where the Insurance Company is not successful in its defence, obviously it is required to satisfy the decree and the award. Where it is successful in its defence, it may yet be required to pay the amuont to the claimant and thereafter recover the same from the owner under such circumstance envisaged and enumerated in Section 149(4) and Section 149(5). (iii) Under Section 147 the Insurance Company is not statutorily required to cover the liability in respect of a passenger in a goods vehicle unless such passenger is the owner or agent of the owner of the goods accompanying such goods in the concerned goods vehicle. (iii) Under Section 147 the Insurance Company is not statutorily required to cover the liability in respect of a passenger in a goods vehicle unless such passenger is the owner or agent of the owner of the goods accompanying such goods in the concerned goods vehicle. (iv) Since there is no statutory requirement to cover the liability in respect of a passenger in a goods vehicle, the principle of “pay and recover”, as statutorily recognised in Section 149(4) and Section 149(5), is not applicable ipso facto to such cases and, therefore, ordinarily the Court is not expected to issue such a direction to the Insurance Company to pay to the claimant and threafter recover from the owner. (v) Where, by relying upon the decision of the Supreme Court in Satpal Singh's case, either expressly or even by implication, there has been a direction by the Trial Court to the Insurance Company to pay, the Appellate Court is obviously required to consider as to whether such direction should be set aside in its entirely and the liability should be fastened only on the driver and the owner or whether the Insurance Company should be directed to comply with the direction regarding payment to the claimant and recover thereafter from the owner. (vi) No such direction can be issued by any Trial Court to the Insurance Company to pay and recover relating to liability in respect of a passenger travelling in a goods vehicle after the decision in Baljit Kaur's case merely because the date of accident was before such decision. The date of the accident is immaterial. Since the law has been specifically clarified, no trial court is expected to decide contrary to such decisio. (vii) Where, however, the matter has already been decided by the Trial court before thedecision in Baljit Kaur's case, it would be in the discretion of the Appellate Court, depending upon the facts and circumstances of the case. Whether the doctrine of “pay and recover” should be applied or as to whether the claimant would be left to recover the amount from the person liable i.e., thedriver or the owner, as the case may be”. Whether the doctrine of “pay and recover” should be applied or as to whether the claimant would be left to recover the amount from the person liable i.e., thedriver or the owner, as the case may be”. On the contrary, Nicholos for R.1 to R.3, claimants would submit that the offending car was properly insured with the appellant and therefore, the Insurance Company must and should satisfy the claim first as the dispute is interse between the insurer and the insured. The learned counsel pointed out that the breach of policy conditions the claimant should not suffer. Mr.R. Karthkeyan, counsel for R.5/owner of the vehicle would submit that the deceased is a third party to the contract of policy and therefore, the Tribunal is right in holding that the Insurance Company is liable. The point for consideration that arises in the present appeal is whether the insurance company is liable. It is well settled that the liability of the insurance company is both statutory and also based on the contract of the insurance. It is admitted that the car bearing Registration No........was insured with the appellant. Ex.R.1 is the copy of the insurance policy. As per the endorsement therein, it is a private car act policy. Premium has been paid on three heads. Third party Rs.240/-, driver Rs.15/- UNTPPL (Unlimited Third party Property Liability) Rs.50/-. According to the appellants the passenger is not covered and there is a limitation as to the use of the car and the policy does not cover the use of the vehicle for hire or reward. The 1st respondent who was examined as PW1 would state that the deceased and some of the relatives were travelling in the car from Vellore to Gobichettipalayam at the time of the accident. In the cross examination, it was suggested by the appellant that the deceased and others hired the vehicle for travelling for which P.W.1 would plead ignorance. P.W.2 is a relative cum eyewitness. She would state that they were travelling in a hired car. Ex.P.1 is the first information report. P.W.2 is the informant. She would state that they travelled in a taxi. It is not the case of the claimants that the deceased hired the vehicle and was travelling as gratious passenger. But the fact remains that the vehicle was a private car and covered by an act policy. Ex.P.1 is the first information report. P.W.2 is the informant. She would state that they travelled in a taxi. It is not the case of the claimants that the deceased hired the vehicle and was travelling as gratious passenger. But the fact remains that the vehicle was a private car and covered by an act policy. IN Amritlal's case reported in AIR 1998 SC 1433 (Amritlal Sood vs Kaushalya Devi Thapar) , it is held as follows: para21 In a similar issue, a Division Bench Judgment of this Court reported in 2009 2 MLJ 963 (Royal Sundaram Alliance Insurance Co Ltd Coimabtore vs A.Meenakshi and Others) has discussed in detail andhas held para28 Therefore, a comprehensive policy alone covers the risk of gratious passenger in a private car. In the above judgment, the circular of the tariff advisory committee was also extracted which reads as follows page 971 (marekd portion) This Circular relates to a comprehensive policy. Therefore, if it is a comprehensive policy, a gratious passenger in a private car is covered and if it is an act policy, it does not cover.