KACHARABHAI L LIMBACHIA Vs. RATANSINH J RATHOD PATELIA

JUDGEMENT

(1.) The appellant-owner of a tractor and a trolly has preferred this appeal against the award dated 4th December 1993, made by Motor Accident Claims Tribunal, Panchmahals at Godhra, in M.A.C. Petition No. 213 of 1990. The claimants submitted an application inter alia contending that, on 12-2-1990 deceased Sureshbhai while working as a labourer was sitting in the trolly attached with tractor No. GUH - 7809, which was driven by opponent No. 1 in the application. The deceased was thrown off from the trolly as the tractor was being driven at an excessive speed by the opponent No. 1 - driver. The Tribunal after considering the evidence on record held that, the claimants are entitled to recover an amount of Rs. 1,31,000.00 by way of compensation together with 15% per annum from the date of application till its realisation. However, the Tribunal has further held that the liability of the Insurance Company is limited to the extent of Rs. 50,000.00 only and the remaining amount of the award is to be recovered from opponent Nos. 1 and 2 jointly and severally. Being aggrieved by this award of the Tribunal, the present appellantoriginal opponent No. 2 has preferred this appeal. The respondents though served have not chosen to appear before this Court.

(2.) Mr. D. F. Amin, learned Advocate appearing for the appellant has said that the Tribunal had seriously erred in coming to the conclusion that, the Insurance Company is liable to pay an amount of Rs. 50,000.00 only to the claimants and had further erred in coming to the conclusion that the remaining amount should be recovered from the appellant. He invited our attention to S.147 of the Motor Vehicles Act, 1988 (hereinafter referred to as the "Act of 1988"), and the policy issued by the Insurance Company. The effective date of commencement of the insurance policy is 27-4-1989 and the date of expiry of insurance policy is 26-4-1990. According to the policy, limits of the amount of insurer's liability under S.11-1(ii) in respect of any one claim or series of claims arising out of one event is Rs. 50,000.00. It appears that, in view of this, the Tribunal has said that the liability of the Insurance Company is to indemnify to the extent of Rs. 50,000.00 only. The Motor Vehicles Act, 1988 came into force with effect from 1st July 1989, vide Notification No. S. O. 368 (E) dated 22-5-1989. Section 147 of the Act of 1988 which is in Chapter XI refers to requirements of policy and limits of liability. Section 147 of the Act of 1988 reads as under :-

(3.) Thus, the policy of insurance should be in consonance with the provisions contained in S.147 of the Act. Prior to the coming into force the Motor Vehicles Act of 1988, the policies were issued even for a limited liability. However, subsec. (2) of S.147 makes it clear that any policy of insurance issued with any limited liability and is in force immediately before the commencement of the Act, the same shall continue to be effective for a period of four months after such commencement or till the date of expiry of such policy, whichever is earlier. Therefore, the policy if issued with a limited liability, then, so far as that limited liability is concerned, the same shall continue to be in force for a period of four months after the commencement of the Act, or till the date of expiry of a policy, whichever is earlier. In the instant case, as stated earlier, the policy is effective from 27-4-1989. Thus, the policy has been issued before the commencement of the Motor Vehicles Act, 1988, hence that limited liability shall continue to be effective for a period of four months only. The date of expiry of the policy is 26-4-1990, but as the period of four months would expire on 1st November 1989, the liability thereafter will not be limited. So when the accident in question took place on 12- 2-1990, in view of the proviso to sub-S.(2) of S.147 of the Act of 1988, it cannot be said that the liability is limited. In view of S.147 read with proviso thereto the liability of the insurer in the instant case is deemed to have been unlimited on the date of accident.