Bhagwandas v. National Insurance Co. Ltd

(1.) THIS order shall dispose of this appeal, Misc. First Appeal No. 97 of 1985 (Bhagwandas v. National Insurance Co. Ltd.) and Misc. First Appeal No. 98 of 1985 (Bhagwandas v. National Insurance Co. Ltd.).

(2.) APPELLANTS in these three appeals are owners of the truck No. CPC 1996 which was involved in an accident on the Agra-Bombay Road, near the bridge of the Asan river, adjacent to the village of Chhoda, about 8 km. from the town of Morena, in the afternoon of 28th February, 1982. Phoola, wife of Ramchandra and their minor son Pappu, (aged 2 years), Rajuka, wife of Ram Prasad and Ramad himself were travelling in the truck as passengers. The truck overturned. Of the aforementioned passengers, Phoola, wife of Ramchandra and their son Pappu and Ram Prasads wife Rajuka died from the injuries received in the accident. Ram Prasad also received injury.

(3.) RAMCHANDRA filed two claim petitions before the Member of the Motor Accidents Claims Tribunal, Morena, on 26th August, 1982. In Claim Case No. 30 of 1982, Ramchandra claimed Rs. 1,07,000/- as compensation for the death of his wife Phoola (aged 28 years). In Claim Case No. 31 of 1982, Ramchandra claimed Rs. 1,02,000/- as compensation for the death of his son Pappu (aged 2 years).

(4.) RAM Prasad filed Claim Case No. 32 of 1982 on 27. 8. 1982. In it, he claimed Rs. 1,50,000/-as compensation for the death of his wife Rajuka and a sum of Rs. 2,03,000/- as compensation for his injury.

(5.) THE cases were contested by the truck owners and the National Insurance Co. Ltd. which had issued a comprehensive insurance in their favour in respect of the truck in question and the insurance policy was in force on the date of the accident. It covers third party risks.

(6.) THE Tribunal disposed of all the three claim petitions by its award dated 8th July, 1985.

(7.) CLAIMANT Ramchandra (respondent No. 2) in Misc. First Appeal No. 90 of 1985 and Misc. First Appeal No. 97 of 1985 got an award of Rs. 15,000/- (in Claim Case No. 30 of 1982), and another award of Rs. 4,000/- (in Claim Case No. 31 of 1982) as compensation, respectively for the death of his wife Phoola and his minor son Pappu.

(8.) THE truck owner Saheb Singh and the truck driver Bhagwandas, (the appellants in these three appeals) were made liable, jointly and severally, but the insurance company was held not liable under the insurance policy. This was the situation in the three claim petitions in question.

(9.) IN Misc. First Appeal Nos. 90 of 1985 and 97 of 1985 claimant Ramchandra has filed cross-objections claiming in effect an award of Rs. 50,000/- against the driver, the owner and also against the National Insurance Co. Ltd.

(10.) IN Misc. First Appeal No. 98 of 1985 claimant-respondent No. 2 Ram Prasad died during the pendency of the appeal. His four sons and three daughters were impleaded as his legal representatives. The legal representatives of Ram Prasad have filed a cross-objection claiming Rs. 3,60,000/- against the owner and the truck driver and also against the National Insurance Co. Ltd.

(11.) DURING the appeals, the claimants were permitted to amend their respective claim petitions and cross-objections claiming no fault compensation under Section 92-A of the Motor Vehicles Act, 1939.

(12.) IT is now not disputed by the appellants that the truck in question, with appellant No. 1 Bhagwandas as a duly licensed driver thereof overturned, resulting in the accident in question in which Phoola, Pappu, Rajuka died and Ram Prasad received injuries and others who lost their lives or received injuries--all had been travelling in the truck as passengers from whom the truck driver had taken money to take them on the truck and to carry them to their respective destinations.

(13.) THE first point, then, for determination is whether the accident was the result of rash or negligent driving by appellant No. 1 Bhagwandas.

(14.) CLAIMANT Ram Prasad AW 2, Kamal Singh AW 3 and Sardar Singh AW 4 were travelling in the same truck as passengers. Their evidence is to the effect that when all of them including the dead and the injured boarded the truck, it was drizzling. They consistently deposed that the truck driver tore off in an excessive speed which induced fear and apprehension in the minds of the passengers. They cried out for the slackening of the speed but the truck driver did not pay any heed to them. The result was that the truck overturned. These witnesses withstood the cross-examination very well.

(15.) THE sole witness in rebuttal was appellant No. 1 Bhagwandas, the truck driver. He admitted that the truck was loaded with murrum. He admitted that the truck overturned on its side near the river.

(16.) THE drivers explanation is that two buffaloes were crossing the road. The truck was being driven slowly. He applied the foot brakes resulting in the sudden breakdown of some parts of the truck and the accident occurred. The claimants witnesses denied the aforementioned suggestions.

(17.) THE five labourers, who had escaped uninjured, were not examined by the appellants, who did not adduce any corroborative evidence about the breakdown of the truck as a result of the use of the foot brakes of the truck.

(18.) WE accept the claimants evidence and hold that the accident occurred--it is a clear case of res ipsa loquitur--as a result of rash driving by appellant No. 1 Bhagwandas.

(19.) THE next point for determination is whether the learned Member of the Tribunal erred in holding that the National Insurance Co. Ltd. was not liable in terms of the insurance policy, in so far as the truck driver picked up Phoola, Pappu, Rajuka and claimant Ram Prasad as passengers. The Tribunal relied on Abdul Salam v. Kishan, 1981 MPWN 226.

(20.) THE relevant terms and conditions of the insurance policy in question run as follows: Limitations as to use: Use only under a public carriers permit within the meaning of the Motor Vehicles Act, 1939. The policy does not cover:

(1) Use for organised racing, pace-making, reliability trial or speed testing. (2) Use whilst drawing a trailer except the towing (other than for reward) of any one disabled mechanically propelled vehicle. (3) Use for the conveyance of passengers for hire or reward.

(21.) NOW, we turn to the relevant provisions of the Motor Vehicles Act, 1939, contained in Chapter VIII (Insurance of Motor Vehicles Against Third Party Risks). 94. Necessity for insurance against third party risk.-- (1) 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 in 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. XXX XXX XXX

95. Requirements of policies and limits of liability.-- (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which- (a) is issued by a person who is an authorised insurer or by a co-operative society allowed under Section 108 to transact the business of an insurer, and (b) insures the person or classes of persons specified in the policy to the extent specified in Sub-section (2)- (i) against any liability which may be incurred by him in respect of the 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; (ii) 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: Provided that a policy shall not be required- (i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmens Compensation Act, 1923 (8 of 1923), in respect of the death of, or bodily injury to, any such employee- (a) engaged in driving the vehicle, or (b) if it is a public service vehicle, engaged as a conductor of the vehicle or in examining tickets on the vehicle, or (c) if it is a goods vehicle, being carried in the vehicle, or (ii) except 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, to cover liability in respect of the death of or bodily injury to persons being carried in or upon or entering or mounting or alighting from the vehicle at the time of the occurrence of the event out of which a claim arises, or (iii) to cover any contractual liability.

XXX XXX XXX 95 (2) Subject to the proviso to Sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely- (a) where the vehicle is a goods vehicle, a limit of fifty thousand rupees in all, including the liabilities, if any, arising under the Workmens Compensation Act, 1923 (8 of 1923), in respect of the death of, or bodily injury to, employees (other than the driver), not exceeding six in number, being carried in the vehicle; (b) 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,- (i) in respect of persons other than passengers carried for hire or reward, a limit of fifty thousand rupees in all; (ii) in respect of passengers,- (1) a limit of fifty thousand rupees in all where the vehicle is registered to carry not more than thirty passengers; (2) a limit of seventy-five thousand rupees in all where the vehicle is registered to carry more than thirty but not more than sixty passengers; (3) a limit of one lakh rupees in all where the vehicle is registered to carry more than sixty passengers; and (4) subject to the limits aforesaid, ten thousand rupees for each individual passenger where the vehicle is a motor car, and five thousand rupees for each individual passenger in any other case; (c) save as provided in Clause (d), where the vehicle is a vehicle of any other class, the amount of liability incurred; (d) irrespective of the class of the vehicle, respect of damage to any property of a third party. XXX XXX XXX 95 (5) Notwithstanding anything elsewhere contained in any law, a person issuing a policy of insurance under this section shall be liable to indemnify the person or classes of person specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of person.

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96. Duty of insurers to satisfy judgments against persons insured in respect of third party risks.- (1) If, after a certificate of insurance has been issued under Sub-section (4) of Section 95 in favour of the person by whom a policy has been effected, judgment in respect of any such liability as is required to be covered by a policy under Clause (b) of Sub-section (1) of Section 95 (being a liability covered by the terms of the policy) is obtained against any person insured by the policy, then, notwithstanding that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable there under, as if he were the judgment-debtor, in respect of the liability, together with any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments.

(2) 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 proceeding 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) that the policy was cancelled by mutual consent or by virtue of any provision contained therein before the accident giving rise to the liability, and that either the certificate of insurance was surrendered to the insurer or that the person to whom the certificate was issued has made an affidavit stating that the certificate has been lost or destroyed, or that either before or not later than fourteen days after the happening of the accident the insurer has commenced proceedings for cancellation of the certificate after compliance with the provisions of Section 105, or (b) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely: (i) a condition excluding the use of the vehicle- (a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or (b) for organised racing and speed testing, or (c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or (d) without side-car being attached, where the vehicle is a motor cycle, or (ii) a condition excluding driving by a named person or persons or by any person who is not duly licensed, or by any person who has been disqualified for holding or obtaining a driving licence during the period of disqualification; or (iii) a condition excluding liability for injury caused or contributed to by conditions of war, civil war, riot or civil commotion; or (c) that the policy is void on the ground that it was obtained by the non-disclosure of a material fact or by a representation of fact which was false in some material particular.

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(3) Where a certificate of insurance has been issued under Sub-section (4) of Section 95 to the person by whom a policy has been effected, so much of the policy as purports to restrict the insurance of the persons insured thereby by reference to any conditions other than those in Clause (b) of Subsection (2) shall, as respects such liabilities as are required to be covered by a policy under Clause (b) of Sub-section (1) of Section 95, be of no effect, provided that any sum paid by the insurer in or towards the discharge of any liability of any person which is covered by the policy by virtue only of this Sub-section shall be recoverable by the insurer from that person.

(4) If the amount which an insurer becomes liable under this section to pay in respect of a liability incurred by a person insured by a policy exceeds the amount for which the insurer would apart from the provisions of this section be liable under the policy in respect of that liability, the insurer shall be entitled to recover the excess from that persson.

(5) In this section the expression material fact and material particular mean, respectively, a fact or particular of such a nature as to influence the judgment of a prudent insurer in determining whether he will take the risk and, if so, at what premium and on what conditions, and the expression liability covered by the terms of the policy means a liability which is covered by the policy or which would be so covered but for the fact that the insurer is entitled to avoid or cancel or has avoided or cancelled the policy. (6) No insurer to whom the notice referred to in Sub-section (2) [or Sub-section (2-A)] has been given shall be entitled to avoid his liability to any person entitled to the benefit of any such judgment as is referred to in Sub-section (1) or Sub-section (2-A) otherwise than in the manner provided for in Sub-section (2) or in the corresponding law of the reciprocating country, as the case may be.

(22.) RULE 111 of the M. P. Motor Vehicles Rules, 1974 deals with carriage of persons in goods vehicles. The material portions of Rule 111 are as follows:

111. Carriage of persons in goods vehicles.- (1) Save in the case of vehicle which is being used for the carriage of police or a stage carriage in which goods are being carried in addition to passengers no person shall be carried in a goods vehicle other than a bona fide employee of the owner or the hirer of the vehicle, or the owner or the hirer and except in accordance with this rule. XXX XXX XXX (2) No person shall be carried in the cab of a goods vehicle beyond the number for which there is seating accommodation at the rate of thirty-eight centimetres measured along the seat for each person excluding the space reserved for the driver, and not more than (i) six persons in addition to the driver in any goods vehicle other than light transport vehicle; XXX XXX XXX (5) No person shall be carried in any goods vehicle- (a) unless an area of not less than 3600 square centimetres of the floor of the vehicle is kept open for each person; (b) in such manner- (i) that such person when carried on goods or otherwise is in danger of falling from the vehicle; (ii) that any part of his body, if he was in a sitting position, is at a height exceeding three metres from the surface upon which the vehicle rests.

(23.) THE undisputed and proved facts may be recapitulated at this stage. Appellant No. 1 Bhagwandas, a licensed truck driver, was driving the truck in question with a load of murrum with five labourers, when he stopped the truck and picked up about a dozen persons (including Phoola, Pappu, Rajuka and Ram Prasad) after recovering fares from them. These passengers were carried on the top of the load of the murrum in the truck. At this point of time, appellant No. 2 Saheb Singh, was not present. It was appellant No. 1 Bhagwandass rashness/negligence in the driving of the truck in the public place that resulted in the accident and the deaths of Phoola, Pappu, Rajuka and injuries to claimant Ram Prasad.

(24.) THE truck driver is, therefore, liable to pay compensation. Appellant No. 2 Saheb Singh, was vicariously liable.

(25.) IT is clear that the truck in question was also being used for the conveyance of passengers for hire or reward--a user expressed to be not covered by the policy in view of Clause (3), extracted at paragraph 20 (supra). This user also contravened Sub-rules (1), (2) and (5) of Rule 111 extracted above in paragraph 22 (supra).

(26.) THE common submission of the appellants and the claimants, directed against the insurance company, is that the law laid down by the Supreme Court in Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan 1987 ACJ 411 (SC), establishes their plea that the National Insurance Co. Ltd. is also liable to satisfy the award to the extent specified in the insurance policy.

(27.) THE facts were that the truck had unloaded the goods at Baroda. The owner of the truck was not there. The truck had been in the charge of a licensed truck driver, accompanied by a cleaner who did not hold any driving licence. The driver left the truck, with the engine running and the ignition key in the ignition lock and had left the control of the truck to the cleaner. The cleaner started the truck in the absence of the driver resulting in an accident. Admittedly, the truck was used by a person, not duly licensed. The insurance policy had an exclusion clause, prohibiting driving of the vehicle in question by a person not duly licensed. The High Court of Gujarat held that the insurance company was liable to satisfy the award passed against the truck owner and the truck driver. It was observed:

. . . The owner in the present case never gave permission to this cleaner to drive and, therefore, the owner even though he had become liable by reason of his vicarious liability, he could not be held guilty of the breach of the contractual condition embodied in the policy of insurance. Therefore, the insurer cannot plead any exemption on the ground that the owner had committed breach of the specified condition. . . .

Before the Supreme Court the appellant insurance company took the plea that once it was established that the accident occurred when an unlicensed person was the driver the insurance company would be exonerated from the liability. The reason advanced was that the exclusion clause in the insurance policy is strictly in accordance with the statutorily permissible exclusion embodied in Section 96 (2) (b) (ii) of the Motor Vehicles Act.

(28.) THE Supreme Court observed that the validity of this argument advanced by the insurance company had to be tested in the light of the provisions contained in Sections 96 (1) and 96 (2) (b) (ii) of the Motor Vehicles Act.

(29.) THE Supreme Court held that the exclusion clause did not exonerate the insurer.

(30.) AT paragraph 12 of the judgment their Lordships gave three reasons for rejecting the defence of the insurance company which run as follows:

(1) On a true interpretation of the relevant clause which interpretation is at peace with the conscience of Section 96, 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 express or implied mandate being given to the licensed driver not to allow the vehicle to be left unattended so 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.

(31.) AT paragraph 13 of the judgment, their Lordships of the Supreme Court highlighted the goals set by the provisions of Sections 94 and 96 of the Motor Vehicles Act and their vital role in the interpretation of the exclusion clauses in the insurance policy. In order to divine the intention of the legislature in the course of interpretation of the relevant provisions there can scarcely be a better test than that of probing into the motive and philosophy of the relevant provisions keeping in mind the goals to be achieved by enacting the same. Ordinarily it is not the concern of the legislature whether the owner of the vehicle insures his vehicle or not. If the vehicle is not insured, any legal liability arising on account of third party risk will have to be borne by the owner of the vehicle. Why then has the legislature insisted on a person using a motor vehicle in a public place to insure against third party risk by enacting Section 94 Surely the obligation has not been imposed in order to promote the business of the insurers engaged in the business of automobile insurance. The provision has been inserted in order to protect the members of the community travelling in vehicles or using the roads from the risk attendant upon the user of motor vehicles on the roads. The law may provide for compensation to victims of the accidents who sustain injuries in the course of an automobile accident or compensation to the dependants of the victims in the case of a fatal accident. However, such protection would remain a protection on paper unless there is a guarantee that the compensation awarded by the courts would be recoverable from the persons held liable for the consequences of the accident. A court can only pass an award or a decree. It cannot ensure that such an award or decree results in the amount awarded being actually recovered, from the person held liable who may not have the resources. The exercise undertaken by the law courts would then be an exercise in futility. And the outcome of the legal proceedings which by the very nature of things involve the time cost and money cost invested from the scarce resources of the community would make a mockery of the injured victims or the dependants of the deceased victim of the accident, who themselves are obliged to incur not inconsiderable expenditure of time, money and energy in litigation. To overcome this ugly situation the legislature has made it obligatory that no motor vehicle shall be used unless a third party insurance is in force. To use the vehicle without the requisite third party insurance being in force is a penal offence. The legislature was also faced with another problem. The insurance policy might provide for liability walled in by conditions which may be specified in the contract of policy. In order to make the protection real, the legislature has also provided that the judgment obtained shall not be defeated by the incorporation of exclusion clauses other than those authorised by Section 96 and by providing that except and save to the extent permitted by Section 96 it will be the obligation of the insurance company to satisfy the judgment obtained against the persons insured against third party risks (vide Section 96). In other words, the legislature has insisted and made it incumbent on the user of a motor vehicle to be armed with an insurance policy covering third party risks which is in conformity with the provisions enacted by the legislature. It is so provided in order to ensure that the injured victims of automobile accidents or the dependants of the victims of fatal accidents are really compensated in terms of money and not in terms of promise. Such a benign provision enacted by the legislature having regard to the fact that in the modern age the use of motor vehicles, notwithstanding the attendant hazards, has become so inescapable fact of life, has to be interpreted in a meaningful manner which serves rather than defeats the purpose of the legislation. The provision has, therefore, to be interpreted in the twilight of the aforesaid perspective.

(32.) AT paragraph 14, the Supreme Court examined the subject of the immunity to the insurance company consequent upon the breach of the condition in Section 96 (2) (b) (ii). It was stated:. . . The expression breach is of great significance. The dictionary meaning of breach is infringement or violation of a promise or obligation. (See Collins English Dictionary). It is, therefore, abundantly clear that the insurer will have to establish that the insured is guilty of an infringement or violation of a promise that a person who is not duly licensed will have to be in charge of the vehicle. The very concept of infringement or violation of the promise that the expression breach carries within itself induces an inference that the violation or infringement on the part of the promisor must be a wilful infringement or violation. If the insured is not at all at fault and has not done anything he should not have done or is not amiss in any respect how can it be conscientiously posited that he has committed a breach It is only when the insured himself places the vehicle in charge of a person who does not hold a driving licence, that it can be said that he is guilty of the breach of the promise that the vehicle will be driven by a licensed driver. It must be established by the insurance company that the breach was on the part of the insured and that it was the insured who was guilty of violating the promise or infringement of the contract. Unless the insured is at fault and is guilty of a breach the insurer cannot escape from the obligation to indemnify the insured and successfully contend that he is exonerated having regard to the fact that the promisor (the insured) committed a breach of his promise. . . . And it is only in case of a breach or a violation of the promise on the part of the insured that the insurer can hide under the umbrella of the exclusion clause.

(33.) THE Lordships of the Supreme Court extracted Section 84 pertaining to stationary vehicles which runs as follows: 84. Stationary Vehicles.--No person driving or in charge of a motor vehicle shall cause or allow the vehicle to remain stationary in any public place, unless there is in the drivers seat a person duly licensed to drive the vehicle or unless the mechanism has been stopped and a brake or brakes applied or such other measure taken as to ensure that the vehicle cannot accidentally be put in motion in the absence of the driver.

(34.) TO deal with the effect of the aforementioned Section 84 their Lordships observed as follows: In view of this provision apart from the implied mandate to the licensed driver not to place a non-licensed person in charge of the vehicle, there is also a statutory obligation on the said person not to leave the vehicle unattended and not to place it in charge of an unlicensed driver. What is prohibited by law must be treated as a mandate to the employee and should be considered sufficient in the eye of law for excusing non-compliance with the conditions. It cannot, therefore, in any case be considered as a breach on the part of the insured. To construe the provision differently would be to rewrite the provision by engrafting a rider to the effect that in the event of the motor vehicle happening to be driven by an unlicensed person regardless of the circumstances in which such a contingency occurs, the insurer will not be liable under the contract of insurance.

(35.) THE Lordships of the Supreme Court highlighted the problem by further observing as follows: It needs to be emphasised that it is not the contract of insurance which is being interpreted. It is the statutory provision defining the conditions of exemption which is being interpreted. These must, therefore, be interpreted in the spirit in which the same have been enacted accompanied by an anxiety to ensure that the protection is not nullified by the backward looking interpretation which serves to defeat the provision rather than to fulfil its life-aim. To do otherwise would amount to nullifying the benevolent provision by reading it with non-benevolent eye and with a mind not tuned to the purpose and philosophy of the legislation without being informed of the true goals sought to be achieved. What the legislature has given, the court cannot deprive of by way of an exercise in interpretation when the view which renders the provision potent is equally plausible as the one which renders the provision impotent. In fact it appears that the former view is more plausible apart from the fact that it is more desirable. When the option is between opting for a view which will relieve the distress and misery of the victims of accidents or their dependants on the one hand and the equally plausible view which will reduce the profitability of the insurer in regard to the occupational hazard undertaken by him by way of business activity, there is hardly any choice. The court cannot but opt for the former view. Even if one were to make a strictly doctrinaire approach, the very same conclusion would emerge in obeisance to the doctrine of reading down the exclusion clause in the light of the main purpose of the provision so that the exclusion clause does not cross swords with the main purpose highlighted earlier. The effort must be to harmonize the two instead of allowing the exclusion clause to snipe successfully at the main purpose.

(36.) THEIR Lordships also referred to para 251 in Carters Breach of Contract which was extracted in the judgment as follows: Notwithstanding the general ability of contracting parties to agree to exclusion clauses which operate to define obligations there exists a rule, usually referred to as the main purpose rule, which may limit the application of wide exclusion clauses defining a promisors contractual obligations. For example, in Glynn v. Margetson and Co. (1893) AC 351, Lord Halsbury, L. C. stated: it seems to me that in construing this document, which is a contract of carriage between the parties, one must in the first instance look at the whole instrument and not at one part of it only. Looking at the whole instrument, and seeing what one must regard. . . as its main purpose, one must reject words, indeed whole provisions, if they are inconsistent with what one assumes to be the main purpose of the contract. Although the rule played a role in the development of the doctrine of fundamental breach, the continued validity of the rule was acknowledged when the doctrine was rejected by the House of Lords in Suissee Atlantique Societe D Armement Maritime, S. A. v. N. V. Rotterdamsche Kolen Centrale (1967) 1 AC 361. Accordingly, wide exclusion clauses will be read down to the extent to which they are inconsistent with the main purpose, or object of the contract.

(37.) THE following is a conspectus of the law enunciated in Skandia Ins. Co. Ltd. v. Kokilaben Chandravadan 1987 ACJ 411 (SC). An owner of a motor vehicle or a person employed by him to drive the motor vehicle, driving the vehicle rashly or negligently causes an accident resulting in the infliction of injuries on a person travelling in the vehicle or using a public road. The driver is liable in tort to pay compensation to them receiving injuries in the accident or to the dependants of the persons dying in the accident. If the driver of the vehicle is an employee of the owner, the latter is vicariously liable to pay the compensation. The fact that a judgment or an award has been passed against the persons held liable as aforesaid, does not necessarily ensure payment of the compensation by the truck owner and/or the truck driver to the claimants. For one thing, the truck owner and/or the driver may not have means or sufficient means to meet their liability. The legislature stepped in and enacted the provisions contained in Chapter VIII of the Motor Vehicles Act, 1939. Section 94 made it compulsory for the owner of the motor vehicle to take out a policy of insurance in accordance with the provisions of Chapter VIII of the Act, before using his motor vehicle in a public place. (The driving of an uninsured vehicle, in contravention of the provisions of Section 94, is made punishable with imprisonment or fine or both under Section 125 of the Motor Vehicles Act, 1939). Once an insurance policy is taken out fulfilling the requirements of Chapter VIII and a certificate of insurance has been issued under Sub-section (4) of Section 95 and then an accident results from the user of the motor vehicle in a public place, the claimant, that is, the injured person or the dependants of the person dying in the accident, file a claim petition for compensation. Then under Subsection (2) of Section 96, a notice of the claim proceeding has to be given to the insurer through the court. If it is established in the proceeding that the truck driver and the owner of the truck, that is, the insured, are found liable in the proceeding to pay compensation to the claimants, the insurance company in question is bound to pay to the claimants a sum not exceeding the sum assured, as if the insurance company were the judgment-debtor in respect of the liability, together with interest payable on the compensation, and also the costs of the proceeding. The insurance company may defend the proceeding on the grounds set out in clauses (a), (b) and (c) of Sub-section (2) of Section 96. If the insurance company relies on the conditions specified in Sub-clause (i) or sub-clause (ii) of Clause (b) of Sub-section (2) of Section 96, the insurance company cannot stand absolved merely on proof that the conditions mentioned in Sub-clauses (i) and (ii) of Clause (b) of Sub-section (2) of Section 96 have been taken care of by the facts and circumstances of the case. The insurance company has to prove that there was a breach of the conditions in question, that is, wilful infringement or violation committed by the insured. If the insurance company fails to establish all this and it is found that the insured is not at all at fault and has not done anything, he should not have done, or was amiss in any respect, the insurance company cannot succeed on the strength of the exclusion clause in the insurance policy in respect of condition complained of. This view of the law is based on the hypothesis that the conditions referred to in Section 96 (2) (b) (i) and (ii) are not absolute ones. Hence, if the insured could show that he himself was not guilty of a deliberate breach of the condition, the insurance company must be made to fulfil its statutory obligations under Section 96 (1).

(38.) AT any rate, any statutory rule providing for penal consequences for the breach of the condition by the driver, could not, therefore, in any case be taken as a breach on the part of the nsured himself.

(39.) IT is only the aforementioned interpretation which is at peace with the conscience of Section 96, involving, of necessity, of reading-down of the exclusion clause in the insurance policy to the extent that it is not at war with the main purpose of the provisions enacted for the protection of victims of the accident, that is, to ensure them a quick payment of the compensation by the insurance company, because it was for this purpose and not for the purpose of promoting the business of the insurers engaged in the business of automobile insurance that the provisions of Chapter VIII of the Act were enacted.

(40.) THE law enunciated by the Supreme Court in Skandia Insurance Companys case, 1987 ACJ 411 (SC), applies to the facts and the circumstances of the case before us. Here, the truck owner himself did not carry the accident-victims for hire or reward. He was, therefore, not guilty of the breach of the condition excluding the use of the vehicle for a purpose not allowed by the permit under which the vehicle was used, that is, of item (c) of Sub-clause (i) of Clause (b) of Sub-section (2) of Section 96, or of the conditions of limitation as to the user of the vehicle, contained in the insurance policy, extracted at paragraph 20 (supra). It may be underscored that the provisions of items (a), (b), (c) and (d) of Sub-clause (i) and the provisions of Sub-clause (ii) of Clause (b) of Sub-section (2) of Section 96 have been categorised together under Clause (b). Hence, the effect given in the Supreme Court judgment to Sub-clause (ii) of Clause (b) of Sub-section (2) of Section 96 would apply with equal force to the effect of Sub-clause (i) of Clause (b) of Sub-section (2) of Section 96. It is clear that the National Insurance Co. Ltd. is bound under Section 96 (1) as if it were the judgment-debtor to pay to the claimants compensation up to the extent of the sum assured in the insurance policy.

(41.) BEFORE discussing these rulings, it would be appropriate to see what the Supreme Court judgment in Skandia Insurance Companys case 1987 ACJ 411 (SC), said about the case-law found to be inadequate and not of any help in resolving the issues that arose in the Supreme Court case.

(42.) IN Shankarrao Prahladrao Joshi v. Babulal Fouzdar 1982 ACJ (Supp) 338 (MP), the insurance company was exonerated on the ground that the driver of the vehicle did not hold a licence to drive the vehicle and this was a condition specified in the insurance policy. The Supreme Court held that the view of the High Court was erroneous. It was observed at paragraph 7:

. . . the conclusion of the High Court is backed only by an assertion and not by reasoning. It is, therefore, of little assistance in resolving the issue.

(43.) ABOUT Kripa Nath Chakravarthy v. Rup Chand Lunawat AIR 1955 Assam 157, the Supreme Court said (at paragraph 5): The High Court has, however, proceeded to absolve the insurance company from the liability in the light of Section 96 (2) of the Act. The High Court in doing so has not examined or analysed the provisions of Section 96 (2) and has taken for granted that once it is established that the vehicle was being driven by an unlicensed person, the insurance company stood exonerated. The decision is, therefore, of little significance for testing the validity or otherwise of the view taken in the judgment under appeal.

(44.) ORISSA State Commercial Trans. Corpn. v. Dhumali Bewa 1982 ACJ 225 (Orissa), held the insurer not liable by observing that the driver of the vehicle had no driving licence and that the accident did not occur in a public place. The Supreme Court observed:

The entire reasoning. . . does not throw any light in regard to the basis of the reasoning or the interpretation of Section 96 (2) (b) (ii).

(45.) THE Assam and the Orissa decisions were also held to be erroneous.

(46.) THE upshot is that for the issue of liability of an insurer in third party risk cases, the court has to read down the exclusion clause in the insurance policy and to see that the insurance company has also to establish that the insured himself was responsible for the fundamental breach of the conditions set out in Section 96 (2) (b) (i) and (ii) and that if all this is not done, the judgment in question results in a solution of the problem which is not in accordance with Section 96 (2) and, therefore, of little help.

(47.) ABDUL Salam v. Kishan 1981 MPWN 226, relied on by the Claims Tribunal in the impugned award and Thakurbai v. Virath Rustamji Patel 1983 MPWN 355, Nanu v. Hayat Khan 1 (1988)ACC 10 and Santra Bai v. Prahlad 1985 ACJ 762 (Rajasthan), relied on by the insurer, there was no reference whatsoever to the provisions of Section 96 (2) and no attempt to read down the exclusion clause in the insurance policy in the light of the aims and objects for which the provisions of insurance against third party risks were enacted. Hence, these rulings are of no help to the insurance company here in the face of the dictum of the Supreme Court in Skandias case 1987 ACJ 411 (SC).

(48.) PUSHPABAI Purshottam Udeshi v. Ranjit Ginning and Pressing Co. Ltd. 1977 ACJ 343 (SC), turns on its own facts. There all that was held was that Clause (ii) of the proviso to Subsection (1) of Section 95 did not require that a policy of insurance should cover risk to the passengers who are not carried for hire or reward. Hence, this judgment is of no help to the insurance company.

(49.) IN the result, the National Insurance Co. Ltd. is bound, in terms of Sub-section (2) of Section 96, to pay compensation to the claimants to the extent of the sums assured in the policy.

(50.) THE next point for determination is whether the claimants are entitled to enhancement of their respective compensation, as claimed in their cross-objections, vide paras 9 and 10 (supra). On scrutinising the reasons given by the Claims Tribunal in the light of the rather meagre and inadequate evidence of the claimants on the subject, no case for enhancement is made out. To this extent, the cross-objections fail in the appeals before us.

(51.) AS regards the plea for compensation under Section 92-A of the Motor Vehicles Act, 1939 which came into force on 1. 10. 1982, we are of the view that in view of the finding that the insurance company is liable as a judgment-debtor to satisfy the judgment against the appellants under Section 96 (2), it is not necessary to examine and consider the plea under Section 92-A.

(52.) IN the result, the appeals fail to the extent the appellants liability to compensate the claimants is concerned. The appeals and the cross-objections of the claimants, however, succeed to the extent that the National Insurance Co. Ltd. (respondent No. 1) is held liable to pay compensation with interest and costs for their respective claims cases to the respective claimants under Section 96 of the Motor Vehicles Act, 1939.

(53.) IN the particular circumstances of the case, we leave the parties to bear their costs of these appeals as incurred. The claimants shall also bear the costs of their respective cross-objections. Counsels fees Rs. 300/-, if certified, in each appeal before us. T. N. Singh, J.

(54.) WITH the general conclusion of my noble brother that the Claims Tribunal has erroneously exonerated the insurer, I express my full and complete agreement, albeit for reasons of my own to be stated hereinafter. Beyond that also, I have to say something as respects one cross-objection for enhancement as in that regard, I disagree with my learned brothers conclusion that no case for any enhancement is made out by any claimant.

(55.) FIRST, about the cross-objection of respondent/claimant Ramchandra in MA No. 97 of 1985. He has been awarded Rs. 4,000/-for death of his minor son Pappu, aged 2 years. The view of this court in Shamsher Khan v. MR Electricity Board 1988 ACJ 394 (MP), decided by Gwalior Bench that for loss of human life in a motor accident, the lowest ceiling in the matter of payment of compensation can only be that of Rs. 15,000/- irrespective of the age of the deceased and his station in life, has been reiterated in Indore Benchs decision in Devji v. Anwarkhan, 1989 ACJ 567 (MP). Accordingly, for Pappus death, compensation awarded to his father Ramchandra is enhanced to Rs. 15,000/ -. In so far as the other claims for enhancement are concerned, I agree with the conclusion of my learned brother that neither Ramchandra nor claimant/respondent Ram Prasad (in MA No. 98 of 1985) can get more for the death of their respective wives. The Claims Tribunal has granted compensation in both cases in the sum of Rs. 15,000/- each, applying Section 92-A of the Motor Vehicles Act, for short, the act and has discussed evidence in both cases to hold that higher loss of dependency has not been proved by the two husbands. I accept the reasoning, finding and conclusion in that regard of the Claims Tribunal.

(56.) LET me give my reason to explain first my disagreement with my learned brother on the interpretation of the holding in Skandia Insurance Companys case, 1987 ACJ 411 (SC), before proceeding to indicate how I have reached the conclusion that Section 92-A is attracted to the present proceedings in this court and on that basis passing on to the insurer the liability for payment of compensation to the claimants contemplated thereunder. Frankly speaking, my disagreement is rooted in my own perception of Apex Courts decision that it does not write a charter of freedom for unscrupulous traders and transporters to allow them free scope for unjust enrichment by passing on their statutory liability, compounded by an illegal act, to insurance companies which, under present dispensation, are State undertakings. The beneficent provisions of Chapter VIII, meant to advance social justice, must be given full effect. There can be no doubt about that, but, it is difficult to concede, on the other hand, that in doing so, national wealth at the disposal of such undertakings can be allowed to be squandered and social injustice thereby caused in the process. Such an exercise is undoubtedly interdicted by the constitutional mandate of Article 39 (b) that "material resources of the community are (to be) so distributed as best to subserve the common good", I would, therefore, rivet my attention at para 12 of the report [1987 ACJ 411 (SC)] of the decision cited, which my learned brother has reproduced in para 30 of his judgment, as therein I have read its heart and soul clearly embalmed in constitutional cast. I have considered it necessary to focus exclusively thereon notwithstanding copious quotations of other passages from the said decision also extracted by my learned brother as the key to the interpretation of the exclusionary clause has, in my opinion, been manifestly posited therein by their Lordships. Indeed, that key matches the constitutional shutter through which must be resolved each and every legal controversy that arises at any time for decision by any court of law in this country.

(57.) BEFORE the triune tests above-referred set out in para 12 of the report are analysed, let it be noted importantly that the facts, circumstances and the particular law (particular exclusionary clause) interpreted in the Skandia Insurance Companys case, 1987 ACJ 411 (SC), were different and that is apparent from paras 1 and 3 of the report. Therein is set out the single question posed for determination with respect only to Clause (ii) of Section 96 (2), besides the finding of fact recorded by the High Court that the owner of the offending vehicle in that case "never gave permission to (the) cleaner to drive and, therefore, the owner, even though he had become liable by reason of his vicarious liability, he could not be held guilty for the breach of the contractual condition embodied in the policy". Although my learned brother has held to the contrary, these two distinguishing features make inapplicable, in my opinion, the ratio of that decision to the instant case. The only finding that can be possibly recorded in the instant case, as noted, however, by my learned brother also, is that the owner was not present when the ill-fated passengers had paid to the driver the fare contracted for the journey undertaken. The fact which cannot also be ignored in the instant case is that although the insurer took specific plea in its written statement invoking the exclusionary Clause (i) (a) of Section 96 (2), that plea has remained unchallenged and uncontroverted by the driver and the owner in the instant case. In their written statements, they had both set up commonly an entirely false case alleging that the deceased and injured were not passengers, but were sitting on the roadside and that they were hit when the truck turned turtle. The owner did not even enter into the witness-box, leaving open to court scope for drawing adverse inference against him in accordance with the law that he was party to the drivers illegal act.

(58.) RULES of pleadings and evidence, according to me, are not meant by their Lordships to be obliterated and I am sure in my mind that the tests aforementioned do not give a total go-bye to them, as is clear from the requirements inhered by the tests. The particular exclusionary Clause construed by their Lordships is required to be read down and insurers protection thereunder is held not absolute, but it is equally clear that the owner is not excused from pleading and proving his contest to the statutory protection of any of the exclusionary clauses claimed by him in any particular case. In the first as also in the third test, owners duty in that regard has been expressly made clear positively indicating, in one case, that it has to be 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" and in the other case, that "the promisor is exculpated when he does everything in his power to keep the promise". The owner must take a clear and positive stand to contest enforcement by the insurer of any of the exclusionary clauses envisaged under Section 96 (2); if he takes merely a negative or neutral stand, he would be outside the umbrella of protection judicially afforded to him in Skandia Insurance Companys case, 1987 ACJ 411 (SC). That he himself is not guilty and the breach complained is not deliberate are facts which are to be pleaded and proved. So also, the fact that he had done everything in his power to honour his specific obligation contemplated under the policy in question as respects any of the exclusionary clauses. His connivance with the driver and his acquiescence in latters illegal act of contravening one or the other specific statutory condition of the policy concerning insurers defence, is to be ruled out by the court on the basis of positive evidence. Otherwise, there would be scope for the unscrupulous owners taking cover behind illegal and forbidden acts of the driver (in some cases the owners may be really privy to such acts) resulting in minimum statutory protection to the insurer deliberately inscribed by the legislature being defeated.

(59.) TO translate into legal language the moral-legal perceptions aforesaid, I would refer to certain statutory provisions, first of the Act itself. Special provisions have been enacted in Section 109-A et. seq. for payment of compensation in cases of hit and run motor accidents and compulsory contribution to the Solatium Fund (contemplated under those provisions) by the insurance companies embraced by the General Insurance Business (Nationalisation) Act, 1978 so that social justice is fully insured in all types of cases of motor accidents. For a just social order to be ordained in the country generally, those provisions must be given solid judicial support; and not ignored or overlooked as would result in a lopsided view being taken in the matter of determination of a claim preferred under Section 110-A and saddling unwarranted liability on the insurance company. Indeed, as such, Section 110-C (2-A) obligates Claims Tribunal to enquire into cases of collusion from which the insurer is likely to suffer in any case and it contemplates further that on collusion being proved, the scope of protection under Section 96 (2) granted to the insurer gets enlarged to enable him to contest the claim freely, openly and fully.

(60.) IT is true that provisions of Code of Civil Procedure do not proprio vigore apply to a proceeding before the Claims Tribunal, but as per Section 110-C, the Tribunal acts generally as a civil court and is vested with necessary powers in that regard. It does not act as an arbitrator but conducts proceedings judicially like a court and indeed, subject to rules framed as per Section 111-A, it has to follow such procedure as is consonant with principles of fair play, propriety and natural justice. The provisions of the Evidence Act, as per Section 1 thereof, are to be applied to the proceedings before the Tribunal because such proceedings are judicial proceedings and the Tribunal is a court. According to Section 103 of that Act, burden of proof as to the particular fact lies on that person who wishes the court to believe in its existence while under Section 106 thereof, when any fact is especially within the knowledge of any person, the burden of proving that fact is upon him. Reference may also be made to certain provisions of Civil Procedure Code which are of fundamental nature based on principles of fair play, propriety and natural justice. Those are: rules 2 and 3 and Sub-rules (1) and (2) of rule 5 of Order 8, Civil Procedure Code. When no pleading is filed by the defendant, namely, the person contesting the cause or claim tried, the court is competent to pronounce judgment on the basis of facts contained in the plaint; in other words, accept the claim filed in writing by the other side. And, indeed, written pleadings by defendant to contest a claim are required to be filed with the object of giving notice to the other side of the case to be tried so that the trial is fair and the other side is not taken by surprise resulting in denial of opportunity to adduce rebuttal evidence. The provisions contained in Order XVII, Civil Procedure Code are equally salutory and have been advisedly applied, in terms, to proceedings before a Claims Tribunal by rule 297 of M. P. Motor Vehicles Rules, 1974, for short, the rules. Rules 2 and 3 of Order XVII contemplate telescoping of proceedings to ensure speedy trial and quick decision being rendered by the court. In my view, the owner cannot in this background claim any procedural immunity. In my opinion, Skandia Insurance Companys case, 1987 ACJ 411 (SC), does not offer him any shield against radiation emanating from the provisions of the Evidence Act and Civil Procedure Code.

(61.) AS earlier alluded, in the instant case, unfortunately, the owner took no care at all to contest the claim of the insurer founded on the breach of Sub-clause (i) (a) of Section 96 (2) (b) of the Act because the insured trucks permit did not allow passengers to be carried for hire. Indeed, although he had filed his written statement at one stage, he preferred to be proceeded against ex parte (vide Tribunals order dated 31. 1. 1984) and did not enter the witness-box or even by proxy prove his case through his driver. The course of proceedings and indeed the conclusion of the Tribunal as also ours, would have been different if the driver had deposed that he had definite instructions of the owner against carrying any passengers on hire in the truck, or that the fare he had collected from the ill-fated passengers was not appropriated by the owner; in other words, that his act was outside the scope of his employment. The only thing that the driver deposed was that the owner was not present at the site when the accident took place. His further evidence that the deceased and the injured involved in the accident were not passengers in the vehicle has been rejected by the Tribunal and by us also. I see little warrant, therefore, in evidence to extend to the instant case the ratio of Skandia Insurance Companys case, 1987 ACJ 411 (SC). It will be, in my opinion, a hazardous exercise to act without any evidence to deny the insurer in the instant case the protection of Sub-clause (i) (a) of Section 96 (2) (b) and indeed, it is not permissible for us to act on surmises and conjectures to take the view that in the instant case, the owner had done everything in his power to ensure that no passenger was carried for hire or reward in the insured truck or that the breach of the condition in that regard was not his own or that it was not deliberate.

(62.) DIFFERENT considerations obviously arise in disposing of insurers defence founded on Sub-clause (i) (a), the purport of which differs materially from that of Sub-clause (ii) considered in Skandia Insurance Companys case, 1987 ACJ 411 (SC). In that context there is relevance not only of Rule 111 of the Rules extracted by my learned brother at para 22 of his judgment, but of other statutory provisions as well to be referred to presently. Be it noted first that Sub-clause (i) (a) speaks of a condition of a permit to be granted not to the driver, but to the owner; and the latter is, therefore, saddled obviously with the primary duty of complying with that condition of use of the vehicle for the purpose specified in the permit. Rule 111 has to be read not only along with Rule 22 (4), but more importantly subject to the parent provisions of Sections 42 and 69 (b) of the Act. There is no doubt that Rule 82 et. seq. contain only guidelines for grant of permit by the Regional Transport Authority. Rule 82 (4) (b) speaks of the conditions to be incorporated in a permit for a goods vehicle that the number of persons shall not exceed the number which may be specified in the permit. According to Section 42 (1), the prohibition is against the owner of a transport vehicle "to use or permit the use" of the vehicle save in accordance with the condition of a permit granted by the concerned Transport Authority. Sub-section (2) deals specifically with the case of carriage of goods for hire or reward in a transport vehicle indicating the exceptions to the prohibition. Cancellation and suspension by the Transport Authority of a permit granted to an owner is contemplated under Section 60 which, inter alia, provides vide Clause (b) such an eventuality in case "the holder of the permit uses or causes or allows the vehicle to be used in any manner not authorised by the permit". The owner cannot, therefore, be excused from pleading and proving a specific case to deny protection to the insurer on the ground merely of his vicarious liability for the accident, the tortfeasor being the driver. There cannot be any doubt that in so far as Sub-clause (i) (a) is concerned, he had to plead and prove that the breach of the condition regarding the permit was not his own and was not deliberate as that statutory provision is not exculpatory, unlike that of Sub-clause (ii) construed in Skandia Insurance Companys case, 1987 ACJ 411 (SC). Indeed, the requirement herein indicated with respect to Sub-clause (i) (a) emerges from the triune tests laid down in that decision, which are to be read subject to Sections 42 and 60 of the Act. The owner must plead and prove that he did not "permit the use of the vehicle or "caused or allowed" that to be so used as not authorised by the permit.

(63.) REFERENCE may now be made, briefly, to decisions cited by insurers counsel, Mr. Malhotra, to support Tribunals decision that the insurer was entitled to invoke Sub-clause (i) (a) of Section 96 (2) (b) to be exonerated of liability in this case. A Division Bench of this court, at Indore, in a recent decision, Oriental Fire and Genl. Ins. Co. Ltd. v. Pramila, 1989 ACJ 809 (MP), deciding a case similar to the one in hand, found reliance on Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan, 1987 ACJ 411 (SC), inadequate and inappropriate. That was a case of a private car used as a taxi and this court, while exonerating the insurer, referred to and relied on a decision of the Madras High Court taking similar view on similar facts. [see United India Fire and Genl. Insurance Co. Ltd. v. M. S. Dorairai, 1982 ACJ 261 (Madras)]. In two other Division Bench decisions of this court, the case was of a truck owner similar to the instant case; and the insurer was held entitled to be exonerated [see Thakurbais case, 1983 MPWN 355; Nanus case, 1 (1988) ACC 10 [LQ/MPHC/1987/385] ]. In two Full Bench decisions--of Rajasthan High Court in the case of Santra Bai, 1985 ACJ 762 (Rajasthan) and of this court in Harishankar Tiwari v. Jagru, 1987 ACJ 1 (MP)---the position on facts was different. Reliance thereon must, therefore, be held inappropriate. Indeed, in those cases, though passengers were carried for hire in a goods vehicle, it was held that primary contract in that case being for carriage of goods with which they were travelling, they were not passengers simplicitor and insurers liability was secured in terms of Section 95 (1) of the Act, justifying their carriage "by reason of or in pursuance of a contract of employment".

(64.) FOR the several reasons enumerated in the foregoing paragraphs, I have found Apex Courts decision in Skandia Insurance Companys case, 1987 ACJ 411 (SC), inapplicable to the facts of the instant case and that explains my respectful difference with my learned brother. However, I propose now to simplify my view that insurers liability can still be secured with the aid of Section 92-A Indeed, during the pendency of these appeals, amendments were effected in the memo of appeal, cross-objections and the claim petitions in order to invoke Section 92-A and on that basis to challenge Tribunals decision exonerating the insurer.

(65.) IT is contended by Mr. Malhotra that Section 92-A has to be read along with Sections 11 and 13 of the Amending Act, namely, Act No. 47 of 1982 and in the context of requirements of Sections 95 and 96 of the Act. According to me, the real question is not whether Section 92-A is retrospective but what is the true scope, ambit and purport of the provision. Admittedly, the provisions of the Amendment Act were brought into force with effect from 1. 10. 1982 and in the instant case, the accident as well as lodgement of claim took place prior to that, namely, on 26. 2. 1982 and 26. 8. 1982 respectively. Counsel had mainly relied on this courts decision in Shamsher Khans case, 1988 ACJ 394 (MP), to submit that in that case this court had expressed the view, that Section 92-A cannot be given retrospective effect. That decision was rendered by me but there is another decision of this court rendered at Indore Bench by another learned single Judge, in the case of Rukmabai v. Ramlal, 1988 ACJ 351 (MP), wherein the view expressed was that Section 92-A may be deemed to have retrospective operation. Other decisions are also cited at the Bar and those will be referred to in due course.

(66.) IT is no doubt true, as contended by Mr. Malhotra, that neither the Amending Act nor in terms, Section 92-A in particular, has been expressly made retrospective in operation. Section 1 (2) of the Amending Act makes this position clear by providing that the Act shall come into force on such date as may be appointed by the Central Government and admittedly, 1. 10. 1982 was appointed in that behalf. The question indeed, in my opinion, as earlier alluded is of the interpretation of Section 92-A (1), but in the context, importantly, of Section 93 (ba). Because, by the same Amending Act, simultaneously Clause (ba) was inserted in Section 93 and the new Chapter VII-A, containing Section 92-A etc. was inserted in the Act; and both provisions took effect simultaneously.

(67.) HOWEVER, relevant portions of all related provisions of the Act having a bearing on the interpretation of Section 92-A are extracted with emphasis appropriately added: 92-A. Liability to pay compensation in certain cases on the principle of no fault.-- (1) Where the death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or disablement in accordance with the provisions of this section. XXX XXX XXX

92-B. Provisions as to other right to claim compensation for death or permanent disablement.-XXX XXX XXX (3) Notwithstanding anything contained in Sub-section (1), where in respect of the death or permanent disablement of any person, the person liable to pay compensation under Section 92-A is also liable to pay compensation in accordance with the right on the principle of fault, the person so liable shall pay the first-mentioned compensation and- (a) if the amount of the first-mentioned compensation is less than the amount of the second-mentioned compensation, he shall be liable to pay (in addition to the first-mentioned compensation) only so much of the second-mentioned compensation as is equal to the amount by which it exceeds the first-mentioned compensation; (b) if the amount of the first-mentioned compensation is equal to or more than the amount of the second-mentioned compensation, he shall not be liable to pay the second-mentioned compensation.

XXX XXX XXX 92-E. Overriding effect.--The provisions of this Chapter shall have effect notwithstanding anything contained in any other provision of this Act or of any other law for the time being in force. 93. Definitions.--In this Chapter-XXX XXX XXX (ba) liability wherever used in relation to the death of or bodily injury to any person includes liability in respect thereof under Section 92-A;. . . 95. Requirements of policies and limits of liability.-- (1) In order to comply with the requirements of this chapter, a policy of insurance must be a policy which- -. . . (b) insures the person or classes of persons specified in the policy to the extent specified in Sub-section (2)- (i) against any liability which may be incurred by him in respect of the 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;. . .

96. Duty of insurers to satisfy judgments against persons insured in respect of third party risks.-- (1) If, after a certificate of insurance has been issued under Subsection (4) of Section 95 in favour of the person by whom a policy has been effected, judgment in respect of any such liability as is required to be covered by a policy under Clause (b) of Sub-section (1) of Section 95 (being a liability covered by the terms of the policy) is obtained against any person insured by the policy, then, notwithstanding that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment-debtor, in respect of the liability. . . .

(68.) ALTHOUGH for the first time Section 92-A creates no fault liability, that event has no significance in the matter of enforcement of that liability as that is attached to the cause of "use of a motor vehicle or motor vehicles" involved in the accident, to be satisfied not in any other manner but "in accordance with the provisions of (that) section". This view is supported by the purport and language of Section 92-A (1) and 92-B (3). This court had taken the same view in Mahila Ramdei v. Nand Kumar, 1987 ACJ 764 (MP), holding that "till such time as the Us was pending there was a jurisdiction vested in the Tribunal and a duty cast on it first to act under Section 92-A before proceeding to dispose of in any manner the claim petition", preferred under Section 110-A The legal position that is clearly manifested in Section 92-B (3) is that pre-existing liability under extant law is merely modified by contemplating that till such time as "the person liable to pay compensation in accordance with the right on principle of fault" has not been absolved finally of his liability arising out of the accident his liability under Section 92-A shall subsist and always remain enforceable. As held in Mahila Ramdei v. Nand Kumar, 1987 ACJ 764 (MP), the liability under Section 92-A is absolute and indefeasible. If during trial of the claim petition under Section 110-A that is not enforced, in the pending appeal (under Section 110-D) the question of non-determination of that liability can be raised. That question must be decided so long as the lis survives as to determination of a claim for compensation for death or permanent disablement due to a motor accident and the date of the accident (which may have taken place before enactment of Section 92-A) can have no bearing on that.

(69.) IT needs to be clarified, however, that Section 92-B (3) itself, in terms, saddles on the insurer the duty of satisfying the award passed under Section 92-A by using the words "also liable to pay compensation in accordance with the right on principle of fault" for interlinking Section 96 (1). There is no provision in the Act that debars enforcement of a claim under Section 92-A in respect of an accident taking place prior to the enactment of Section 92-A Rather, legislature has advisedly pre-empted such an objection by inserting Clause (ba) in Section 93 of Chapter VIII to indicate the imperative of reading together the relevant provisions of both Chapters. In 1973 (Sic. 1957), provisions were made in Chapter VIII to provide for compulsory insurance of a motor vehicle by the owner and passed on to the insurer his vicarious liability arising out of a motor accident to be enforced at a new forum. By enacting in 1982 the new Chapter VII-A (with Section 92-A et. seq.) that forum was invested with more powers to make an interim award to provide for immediate payment to the extent of specified amounts to the destituted claimants, for death or permanent disablement of any person in a motor accident. The definition of liability with reference to Section 92-A was noted by this court in New India Assurance Co. Ltd. v. Phoolwati, 1986 ACJ 106 (MP), and it was held that the liability could not be defended by any objection of non-joinder as the provision was "meant to take care of widows and orphans, to prevent their destitution by providing instant relief to persons who become victims paradoxically of the advent of modern civilisation and its scientific and technological advancement".

(70.) NEEDLESS to reiterate that the interpretation of Section 92-A herein made has emphasized the pre-existing liability of an owner and insurer of a motor vehicle involved in an accident to focus on the procedural duty of the court/tribunal created thereunder and in that connection the universally respected rule of construction that presumption against retrospective operation of the statute is not extended to matters of procedure may be recalled. [see Colonial Sugar Refining Co. , 1905 AC 369; Garikapati Veeraya v. iv. Subbiah Choudhry AIR 1957 SC 540 [LQ/SC/1957/10] ]. We may also profitably refer to Apex Courts recent decision in Mithilesh Kumaris case, 1989 (2) SCC 95 [LQ/SC/1989/100] , wherein it was observed that "a statute is not properly called retrospective statute because a part of the requisite for its action is drawn from a time antecedent to its passing". It was further observed that the court must look at the general scope and purview of the statute and at the remedy sought to be applied and consider what was the former state of law and what the legislation contemplated.

(71.) FEW words remain to be said about Shamsher Khan v. M. P. Electricity Board, 1988 ACJ 394 (MP) and other decisions on Section 92-A, cited at the Bar. In the opening sentence of the judgment in that case the question for determination was posed--"what minimum a human life should fetch in todays money market in this country" and in answering that question it was held that the guidelines provided by Section 92-A must be deemed influenced with the constitutional imperative flowing from Articles 14 and 39 (a) of the Constitution. At para 4 of the report, there is a sentence on which Mr. Malhotra has placed great emphasis--"therefore, Mr. Dubey, who appears for the respondents, is right in submitting that the provision cannot be given retrospective effect and would not also apply otherwise to the instant lis litigated under Section 110-A of the Act. " That observation must be read obiter for the simple reason that the question of retrospective operation or interpretation of Section 92-A et. seq. was not, in specific terms, raised in that case and indeed, the scope of enquiry was limited to the quantum of compensation that could be awarded in a lis litigated under Section 110-A in the case of a child, aged 12 years. Indeed, only Sub-section (2) of Section 92-A was extracted and considered and there is no consideration in the judgment of the language or even of the ambit and purport of Sub-section (1) of Section 92-A or of the other provisions of the new Chapter VII-A It is only in the later decision in Manila Ramdei v. Nand Kumar, 1987 ACJ 764 (MP), that the language of Section 92-A in its entirety was given due consideration.

(72.) IT has to be noticed also that the view taken by this court in Rukmabai v. Ramlal, 1988 ACJ 351 (MP), in interpreting Section 92-A is also based on the premise that the main question to be decided is not of retrospective nature or otherwise of the provision, but of its proper interpretation as noted in para 7 of the report. Indeed, for that view reliance was placed on Oriental Fire and General Insurance Co. v. Shantabai S. Dhume, 1987 ACJ 198 (Bombay), wherein the court interpreted Section 92-A in the same perspective as ours, observing that pendency of the case kept alive the question of liability to be determined and the question was not whether cause of action arose prior to, or after, coming into force of the new provision. In New India Assurance Co. Ltd. v. Ramesh Kalita, 1989 ACJ 609 (Gauhati), the Gauhati High Court has agreed with the Bombay High Court and disagreed with the view expressed by Allahabad, Andhra Pradesh and Rajasthan High Courts, that Section 92-A was not retrospective in operation. I have also looked into those decisions--Ram Mani Gupta v. Mohammad Ibrahim, 1985 ACJ 476 (Allahabad); Ratni Devi Shyam Suka v. B. Venkata Rami Reddy, 1988 ACJ 142 (AP) and Yashoda Kumari v. Rajasthan State Road Trans. Corpn. , 1984 ACJ 716 (Rajasthan)--and am of the same view because in all those cases emphasis is laid only on the fact of creation of new liability in Section 92-A and without, in express terms, making that enforceable retrospectively. I have already observed that Section 92-A has to be interpreted not in isolation, but in the company of Sections 92-B (3), 92-E, 93 (ba), 95 (1) (b) and 96 (1) to divine the object and scope of the provision.

(73.) FOR the foregoing reasons, according to me, the pendency of the instant appeal and the cross-objection claiming benefit of Section 92-A, has given jurisdiction to this court to hold the insurer liable for satisfying the award passed by the Tribunal. In my view, the Tribunals award suffers a patent error of law impairing partially the validity thereof as it has exonerated the insurer even after rightly invoking Section 92-A To the limited liability whether of the owner or the insurer in respect of the amount of compensation specified therein payable in the case of a death or partial disablement in a motor accident, there can be no valid defence by either. Indeed, the overriding and pervasive effect of Section 92-E achieves that position and there would be no impact on that of insurers success or failure in establishing its defence under Section 96 (2) whose relevance must be restricted to the determination of the claim under Section 110-A, for higher amount. This view is not affected, let it be noted, by the Apex Courts holding in Skandia Insurance Companys case, 1987 ACJ 411 (SC), for the simple reason that neither Section 92-A et. seq. was interpreted nor impact thereof on Section 96 (2) was considered in that case.

(74.) IN the result the appeal and cross-objection succeed partially to the extent that liability for payment of Rs. 15,000/- as compensation awarded by the Tribunal to claimant/respondent Ramchandra for his wifes death shall be discharged by the insurer, respondent No. 1 and the impugned award stands modified accordingly.

(75.) BEFORE parting with the record I must discharge my solemn duty as the presiding judge to state reasons for delay in delivery of judgment in this matter. My learned brothers judgment was ready on 5. 5. 1989. Next day the summer break commenced and only on reopening of the court, we could confabulate and deliberate. Thereafter, I could prepare my separate opinion, as aforesaid; and another weeks delay occurred. ORDER OF THE COURT In accordance with the view taken by us in separate judgments rendered by us we dispose of the three connected appeals in terms of the following directions:

(1) This appeal (MA No. 90 of 1985) and the cross-objection are finally disposed of. So also, the connected MA No. 98 of 1985. In both cases the impugned common award is modified to the extent that the insurer-respondent shall discharge the liability for payment of compensation Rs. 15,000/- each to claimants/respondents Ramchandra and Ram Prasad for their wives death. (2) MA No. 97 of 1985 survives consideration of the question as to whether Ramchandras cross-objection has to be allowed and compensation awarded to him for his sons death enhanced. In regard to that we are passing separate order in that appeal.