In the erstwhile All India Motor Tariff – there were Sections 14 (a) & 14 (b) – providing coverage to Third parties traveling in a Goods carrying vehicle by charging 15% & 17.5% on the TP premium. However, the coverage excluded ‘Gratuitous’ passengers !
Gratuitous (adjective) would mean – 1) done without good reason;
uncalled for. 2) given or done free of charge.synonyms: free, gratis, complimentary, voluntary, volunteer, unpaid,
unrewarded, unsalaried, free of charge, without charge, for nothing, at no cost,
without payment.
Sec
147 of Motor Vehicles Act 1988 seeks to exclude gratuitous passengers but
provides cover for owner of the goods or their authorised agents traveling in
a goods carrier.There have been
judgements exonerating the Insurer when petition claiming compensation in
respect of injury of death to a passenger traveling in a goods carrying
vehicle unless the reason for their travel is established to be a person
connected with the journey.The present
Motor Tariff provides charging premium and extending endorsement IMT 37 – legal
liability to Non-Fare Paying Passengers other than Statutory Liability except
the Fatal Accidents Act, 1855 (Commercial Vehicles only).Under this, there is coverage for any
employee who is not a workman and not being carried for hire or reward.~ and any other person not being carried for
hire or reward provided the person is:charterer
or representative of the charterer of the truck or any other person directly
connected with the journey in one form or other being carried in or upon
entering or mounting or alighting from any vehicle described in the
schedule.
With
this background the present judgment of Apex Court dated Aug 9, 2019 is of
significance to the Insurers.(Appeal
6231-6232/2019) were appeals against the judgment and order of High Court of
Punjab & Haryana relating to claim of compensation in respect of injuries
sustained by two gratuitous persons in a jeep (goods vehicle).MACT had dismissed the claim petitions on the
ground that the negligence of the driver
was not proved.
However, the High Court,
after holding that the accident was as a result of composite negligence
of 2 the driver of the jeep and the other offending vehicle, held that the
owner and driver
of the jeep
would be liable
for payment of compensation and exonerated the insurer
of the jeep, on the ground that the vehicle was insured as a goods vehicle and
the claimants, who had sustained
injuries, were gratuitous
passengers in the goods
vehicle (Jeep) andwouldthusnot
be coveredunderthe insurance policy as they were not traveling as owner of the
goods. The insurance of the jeep, as a goods vehicle, has been found to be
valid.
The
petition before the High Court, was of one Anu Bhanvara, aged about fifteen
years at the time of the accident, who, because of injuries sustained, had to
have amputation of wrist
resulting in 55%
disability. The Tribunal assessed total
compensation of Rs.5,26,000/-that included cost of artificial limb at 3.76
lakhs.The High
Courtenhanced the
compensation to Rs.6,41,750/- after
awarding additional compensation for medical expenses, pain and suffering,
income loss etc. in addition to what was assessed by the Tribunal. There was
another petition too – filed byRohit
Kumar, aged about 18 years at the time
of accident, who, because of the injuries sustained in the accident,
had to have
his arm amputated
below theelbow resulting in
70% disability.Here, High Court enhanced the compensation to
Rs.7,36,000/-
Challenging the said judgments of the High Court,appealswere filed
by the claimants
for enhancement of compensation and also to direct payment
of compensation by the insurer. The
issues before the Court were :
1.
Whether
the amount of compensation was adequate ? and
2.
Whether
the payment should be made jointly by Owner & driver of vehicle or by
Insurer who could have recourse to recover from the owner and driver ?
Having
regard to the age of the two claimants and keeping in view that compensation
has been awarded on all requisite heads by the High Court, Apex Court opined that no interference is called with regard to
the quantum of compensation awarded to the two claimants. On the Q of fixing liability- appellants contended that vehicle was
insured and Insurer should be directed to pay and recover. The counsel for appellants relied on the following decisions: ManuaraKhatoon v. 5 Rajesh Kumar Singh (2017) 4 SCC 796,
Puttappa v. Rama Naik (Civil Appeal No.4397 of 2016, disposed of on 2ndApril, 2018); Manager, National Insurance Co.
Ltd. v. Saju P. Paul (2013) 2 SCC 41; New India Assurance Co. Ltd. v. Vimal
Devi and more.
The Insurers contended that since
the claimants were gratuitous passengers
in a goods
vehicle, the liability
for payment of compensation fordeath
or body injury
to the passengers of such goods
vehicle would not be covered,hence the
principle of pay and recover would not apply.
It was further contended that the
order of the High Court is perfectly justified in law and calls for no
interference by this Court.In support
of her submission, learned counsel
relied on decisions: New India Assurance Co. Ltd. v.
Asha Rani (2003) 2 SCC 223; National InsuranceCo. Ltd. v. BaljitKaur (2004) 2
SCC1; National Insurance Co. Ltd. v.
Kaushalya Devi (2008) 8 SCC 246; 6 National Insurance Co. Ltd. v. Rattani
(2009) 2 SCC 75; National Insurance Co. Ltd. v. Prema Devi (2008) 5 SCC 403;
Bharat AXA General Insurance Co. Ltd. v. Adani MANU/TN/6503/2018; Bajaj Allianz General Insurance Co. Ltd. v.
Lal Singh (2015).
The Court on hearing the
Counsels and perusing records and the various decisions cited held that - insurance of the vehicle, though as a goods
vehicle, is not disputed by the parties.The claimants in the casewere
young children who suffered
permanent disability.Hon’ble Court decreed that keeping in view the peculiar facts and
circumstances of the case, we are of the considered view that the principle of
“pay and recover” should be directed to be invoked in the present case. Stating to, the appeals were disposed
of with the direction that the respondent no.1 –
insurance company shall be liable to pay the awarded compensation to the
claimants in both the appeals.It
further recorded that Insurance
company shall have the right to
realize the said amount of compensation from the 7 respondents no.
2 and 3
(driver and owner
of the vehicle)
in accordance with law.
Order
by Hon’ble RF Nariman&Vineet Saran – 9.8.2019
With
regards – S. Sampathkumar
5th
Sept. 2019.
