NATIONAL INSURANCE CO. LTD Vs. PURUSHOTHAMAN C.K.

JUDGEMENT

(1.) THE 3rd respondent in O.P. (MV) Nos. 250, 251, 252, 253, 254 & 255 of 2010 has come up in appeal challenging the common award dated 26.04.2010 passed by the Motor Accidents Claims Tribunal, Kasaragod.

(2.) THE petitioners in all the original petitions were passengers of a private jeep bearing Reg. No. KL -14A -5871 which capsized on 06.02.2010 whereby the petitioners sustained injuries. In paragraph 10 of the impugned award itself the Tribunal has shown that Ext. B1 policy discloses that it is only an 'act only policy' covering liability to compensate third parties. It has been further admitted that all the petitioners are passengers of a private jeep. After making such observations, strangely, the Tribunal has held that there is no legal liability on the part of the 3rd respondent to indemnify the 2nd respondent owner and that still the vehicle is insured with the 3rd respondent, and that the 3rd respondent shall pay the amount and recover the liability from the 2nd respondent, who is the registered owner of the jeep. The insurer has come up in appeal.

(3.) IT is trite law that in the case of an 'act only policy' there cannot be a coverage for the gratuitous passenger or the pillion rider, as the case may be, unless extra premium for such coverage has not been paid. In these cases, the Tribunal has found that the policy in question was an 'act only policy' which would not cover gratuitous passengers. In such a case, the insurer is not liable to pay the amount as per the decision in United India Insurance Company Limited v. Tilak Singh and Others [ : (2006) 4 SCC 404]. In National Insurance Company Limited Vs. Balan @ Balakrishnan and Others [2008(1) KHC 202], it was held that in the case of an 'act only policy', there is no coverage for the gratuitous passenger of a private vehicle, unless extra premium for such coverage is paid. The same is supported by the decision in National Insurance Co. Ltd. v. Parvathneni [ : 2009(3) KLT 995(SC)] wherein it was held that in cases wherein the insurance company has no liability to pay the compensation, it cannot be compelled to make the payment with a direction to recover it later from the owner of the vehicle. A Full Bench of this Court in Oriental Insurance Co. Ltd. v. Joseph [ : 2012(2) KLT 132(FB)] also has held as follows: