NATIONAL INSURANCE COMPANY LIMITED Vs. NOOTI VENKATESWARULU

JUDGEMENT

(1.) This appeal is filed by the National Insurance Company Limited aggrieved by the Award of the Motor Vehicle Accidents Claims Tribunal-cum-the Court of District Judge, Ongole, passed in O.P.No.509 of 1992, dt.30.5.1996. Brief facts of the case are as follows. One Sri Nooti Venu met with an accident on 26.8.1992 involving lorry bearing No.AP 16T 0775 which was driven by the driver in rash and negligent manner. He died in the accident. The claimants therefore filed the O.P. before the Tribunal claiming compensation of Rs.80,000/-.The O.P. was opposed by the Insurance Company inter alia on the ground that the deceased was unauthorised passenger in the goods vehicle and therefore, the claim does not cover under the insurance policy. The Tribunal rejected the contention of the Insurance Company and awarded a sum of Rs.39,000/- with interest at 6% per annum from the date of petition till the date of the Award, at 12% per anum from the date of the Award till 29.8.1996, and thereafter at 15% per annum till the date of payment. Hence, the present C.M.A. is filed by the Insurance Company.

(2.) The learned counsel for the appellant has reiterated the submissions taken before the Tribunal.

(3.) The question raised in this C.M.A is squarely covered by the judgment of the Supreme Court in NEW INDIA ASSURANCE CO. LTD. v. SATPAL SINGH wherein their Lordships held that under the Motor Vehicles Act, 1988 all insurance policies covering third party risks are not required to exclude gratuitous passengers in the vehicle though vehicle is of any type or class. It was held: Under clause (ii) of the proviso to Section 95(1) of the Motor Vehicles Act, 1939 (for short "the old Act") the insurance policy was not required to cover liability in respect of the death of or bodily injury to persons who were gratuitous passengers of that vehicle. But the proviso to Section 147(1) of the Motor Vehicles Act, 1988 (for short, "the new Act") shows that it is a recast provision by placing the erstwhile clause (iii) as the present clause (ii). In other words, clause (ii) of the proviso to Section 95(1) of the old Act is totally non-existent in the proviso to Section 147(1) of the new Act. Moreover, under Section 147(2) of the new Act there is no upper limit for the insurer regarding the amount of compensation to be awarded in respect of death or bodily injury of a victim of the accident. It is, therefore, apparent that the limit contained in the old Act has been removed and the policy should insure the liability incurred and cover injury to any person including owner of the goods or his authorised representative carried in the vehicle..... Therefore, under the new Act an insurance policy covering third-party risk is not required to exclude gratuitous passengers in a vehicle, no matter that the vehicle is of any type or class.