NEW INDIA ASSURANCE COMPANY LTD Vs. KRISHNA DEVI

JUDGEMENT

(1.) IN this appeal two main questions have been raised, namely, (1) whether the liability of the insurance company is limited to the extent of Rs. 50,000/- under the Motor Vehicles Act (in short the Act) ? (2) whether the cross objections filed by the claimants seeking enhancement of compensation are not tenable because appeal has been filed by the Insurance Company ?

(2.) IN order to appreciate these questions we may have quick glance to the relevant facts of this case. Deceased Shri Siri Pal aged about 37 years was standing in front of a tea shop behind Lawrence Road factory area on 10th August, 1982 at about 7.45 AM when a truck bearing No. DEL-6075 driven rashly and negligently came and struck him and his cycle. The deceased was crushed under the front wheels of the truck. At the time of this accident he was employed as a Peon in P&T Department. He was drawing a salary of Rs. 650/- per month. Besides his salary the deceased was also doing part-time business wherefrom he was earning Rs. 800/- per month. Thus his total monthly income was Rs. 1,450/- per month. His legal heirs consisting of his wife and three minor children filed a petition under the Act claiming compensation to the tune of Rs. 3 lakhs. His parents were impleaded as respondents 4 and 5. Written statement was filed by this appellant in which the privity of contract was denied. A plea of limited liabilty was also taken in the written statement but neither the insurance policy was produced nor the insurance company led any evidence. By the impugned award the Motor Accident Claims Tribunal (in short the Tribunal) awarded a sum of Rs. 76,800/- in favour of the claimants besides awarding interest at the rate of 12% from the date of petition till realisation. The awarded amount was to be shared by the claimants and respondents 4 and 5. The Tribunal fixed the liability of the insurance company (present appellant) and of owner and driver joint and several.

(3.) MR . Sanjeev Sachdeva appearing for the claimants contended that if we read the above provision in its proper perspective then it is difficult to subscribe to the version that the provision of clause (a) of sub-section (2) applied to third party. According to him provision of Sub Section (2)(a) talks about a goods vehicle and employees being carried in it. Admittedly in the present case accident took place with a goods vehicle i.e. a Truck. Clause (a) of Sub Section (2) was substituted thereby restricting the liability arising out of the Workmen Compensation Act to six employees carried in a goods vehicle. This is in contrast to the amendment in provisions of Sub Section (1) of Section 95 which makes it compulsory that a policy of insurance must also cover liability arising under the Workmen Compensation Act, 1923 because there may be cases which are not covered by Workmen Compensation Act, 1923 and it is, therefore, justifiable to protect the employees by providing a right against the insurer. Clause (a) of Sub-Section (2) of Section 95 of the Act covers the employees to a limited extent as provided under the clause who are carried in a goods vehicle but certainly it does not apply to a third person crushed on the road, in that case of third party the question of limited liability would not arise. Limited liability under clause (a) is in respect of employees carried in the vehicle. If any injury is caused to them the liability is limited as mentioned in Clause (a) but not if such a vehicle kills a person on the road. In that case the liability is unlimited. Clause (a) of Sub Section 2 provides that whatever the number of persons employed and whatever the number who have suffered death or bodily injury, the liability in respect of them will not extend beyond six persons. But that does not mean that if a goods vehicle kills a third person the Insurance Company would not be liable for the whole amount awarded. By amending Clause (a) the Legislature intended to restrict the liability arising out of the Workmen Compensation Act to six employees carried in a goods vehicle. This clause limits the liability incurred in respect of any one accident with reference to the class of persons carried in the goods vehicle. Thus this Sub Section 2(a) cannot be invoked to restrict the liability to death caused to a third party like the claimants in this case. Deceased was not one of the class of persons referred to in clause (a) of Sub-Section (2) of Section 95 of the Act.