The Oriental Insurance Co. Ltd. v. K.T. Thomas, Cheriyan Mathew and Jose Philip

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** ## **PRESENT:** **THE HONOURABLE MR. JUSTICE P.D.RAJAN** **TUESDAY, THE 31ST DAY OF JANUARY 2017/11TH MAGHA, 1938** **MACA.No. 47 of 2015 ()** **----------------------AGAINST THE AWARD IN OPMV 454/2005 of MOTOR ACCIDENTS CLAIMS TRIBUNAL,PATHANAMTHITTA DATED 05-05-2014** **APPELLANT(S)/4TH RESPONDENT IN THE O.P.: --------------------------------------THE ORIENTAL INSURANCE CO. LTD. RANNY, REPRESENTED BY ITS AUTHORISED SIGNATORY, THE ORIENTAL INSURANCE CO.LTD., REGIONAL OFFICE ERNAKULAM, METRO PALACE, ERNAKULAM NORTH, KOCHI-18.** **BY ADV. SRI.A.R.GEORGE** **RESPONDENT(S)/CLAIMANT & RESPONDENTS 1 & 2 IN THE OP:** **-----------------------------------------------------** **1. K.T.THOMAS S/O.THOMAS, KANJIRATHUMOOTTIL HOUSE, PUTHUSSERY KALLUPPARA VILLAGE, PATHANAMTHITTA-696 605.** **2. CHERIYAN MATHEW S/O.GEE VARUGHESE CHERIAN, MARATHU KUNNEL VEEDU, MALLAPPALLY, PATHANAMTHITTA DIST-689 584.** **3. JOSE PHILIP PERIYILATHU HOUSE, MADATHUMBHAGOM NORTH P.O., PURAMATTOM, PATHANAMTHITTA DIST-689 543.** **R1 BY ADV. SRI.ARUN.B.VARGHESE R1 BY ADV. SRI.JAYKAR.K.S. R3 BY ADV. SMT.M.B.DHANYA BABU R2 BY ADV. SRI.D.G.VIPIN R2 BY ADV. SRI.KAROL MATHEWS SEBASTIAN ALENCHERRY** **THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON 31-01-2017, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:** **acd** ## **'C.R.'** ## **P.D. RAJAN, J.** ------------------------------------------M.A.C.A.No. 47 of 2015 ---------------------------------------------Dated this the 31[st] day of January, 2017 ## **JUDGMENT** This appeal is preferred against the award in O.P.(MV) No.454/2005 of the Motor Accidents Claims Tribunal, Pathanamthitta by the insurer of the lorry KL-3E-9007. The injured's case is that on 31.01.2004 at 10 a.m., while he was alighting from a lorry KL 3E 9007 the 2[nd] respondent had driven the vehicle in a rash and negligent manner, as a result the claimant was thrown away and sustained serious injuries, immediately, he was removed to Pushpagiri Hospital, Thiruvalla. On the basis of a complaint, the police registered a case and after completing investigation, laid charge before the Judicial First Class Magistrate Court, Thiruvalla. The appellant insurance company in the written statement contended that M.A.C.A.No.47/2015 2 the petitioner is a gratuitous passenger and he is not covered as per the policy. The injured was examined as PW1 and his documents were marked as Exts.A1 to A10. The appellant examined RW1 and marked Exts.B1 to B3 as his documentary evidence. The learned tribunal awarded total compensation of 78,309/- with 9% interest and cost₹ to the injured and directed the appellant to satisfy the award. 2. The learned counsel for the appellant contended that the 1[st] is a respondent gratuitous passenger in a lorry and he is not covered as per the policy. The injured is an additional driver-cum-cleaner, who was not driving the lorry at the time of accident as directed by his employer. Merely he was travelling in the cabin of the lorry would not make him different from any other gratuitous passenger. 3. The learned counsel appearing for the 1[st] respondent contended that additional premium was M.A.C.A.No.47/2015 3 collected under Ext.B3 policy and the claimant is covered as per the policy as an employee. 4. While appreciating the rival contention, it is necessary to refer S.146 of the Motor Vehicles Act 1994 (for short 'Act') which ensures the necessity for obtaining insurance policy to vehicles to third party risk. Section 146 of the Act reads as follows: “146. Necessity for insurance agaisnt third party risk:- (1) No person shall use, except as a passenger, or causes or allow any other person to use, a motor vehicle in a public place unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of this Chapter. Provided that in the case of a vehicle carrying, or meant to carry, dangerous or hazardous goods, there shall also b e a policy of insurance under the Public Liability Insurance Act, 1991 (6 0f 1991).” In this context, it is appropriate to quote Section 147 of the Act, which reads as follows: - “147. **Requirements of policies and limits of liability.** (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which- - (a) is issued by a person who is an authorised - insurer; and - (b) insures the person or classes of persons M.A.C.A.No.47/2015 4 specified in the policy to the extent specified in subsection (2)- (i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place; (ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place: provided that a policy shall not be required- (i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the police or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen's Compensation Act, 1923 (8 of 1923) in respect of the death of, or bodily injury to, any such employee,- (a) engaged in driving the vehicle or (b) if it is a public service vehicle engaged as a conductor of the vehicle or in examining tickets on the vehicle or (c) if it is a goods carriage, being carried in the vehicle or (ii) to cover any contractual liability. Explanation.- For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by or to have arisen out of, the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place. (2) Subject to the proviso to sub-section (1), a policy of insurance referred to in sub-section 91), shall cover any liability incurred in respect of any accident, up to the M.A.C.A.No.47/2015 5 following limits, nameluy:- (a) save as provided in clause (b), the amount of liability incurred; (b) in respect of damage to any property of a third party, a limit of rupees six thousand: Provided that any policy of insurance issued with any limited liability and in force, immediately before the commencement of this Act, shall continue to be defective for a period of four months after such commencement or till the date of expiry of such policy whichever is earlier. (3) A policy shall be f no effect for the purposes of this Chapter unless and until there is issued by the insurer in favour of the person by whom the policy is effected a certificate of insurance in the prescribed form and containing the prescribed particulars of any condition subject to which the policy is issued and of any other prescribed matters; and different forms, particulars and matters may be prescribed in different cases. (4) Where a cover note issued by the insurer under the provisions of this Chapter or the rules made thereunder is not followed by a policy of insurance within the prescribed time, the insurer shall, within seven days of the expiry of the period of the validity of the cover note, notify the fact to the registering authority in whose records the vehicle to which the cover note relates has been registered or to such other authority as the State Government may prescribe. (5) Notwithstanding anything contained in any law for the time being in force, an insurer issuing a policy of insurance under this section shall be liable to indemnify the person or classes of persons specified in the policy in respect of any liability which the policy purports to cover in the case of that person or those classes of persons.” ## 5. The Section quoted above would show that the M.A.C.A.No.47/2015 6 owner of the goods or his authorised representative carried in the vehicle are covered under S.147 of the Act 1988. As per Section 147(1) (b) (i), the policy is required to cover the person or class of persons specified in the policy under sub section (i) of Section (1), against any liability which may be incurred by him in respect of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damages to any property of a third party caused by or arising out of the use of the vehicle in a public place. It is clear from the above Section that the owner of the goods or his authorised agent is covered under the policy, which is a statutory requirement provided under the above Section. An owner of the vehicle carrying passengers must pay premium for covering passengers risk in a passenger vehicle. Any liability other than the liability provided under the Act is to be extended under the insurance policy only on payment of additional M.A.C.A.No.47/2015 7 premium. Therefore the scheme of the Act does not ensure any statutory liability on the insurer to pay compensation for any passenger travelling in a goods vehicle. Therefore, any passenger other than a person mentioned under S.147 (1) (b) does not cover by such policy. 6. The liability of insurer towards spare driver travelling in the vehicle has been explained by the Apex Court in _**Manager, National Insurance Company Limited**_ v. _**Saju P. Paul & another**_ which was relied on by the appellant. In the above case, injured was travelling in the vehicle as a part of his employment as a spare driver. The appellant in this case contended that there is no insurance coverage to the spare driver in the policy. What is contemplated by proviso to Section 147 (1) is that the policy shall not be required to cover liability in respect of death or bodily injury sustained by an employee arising out of and in the course of his employment other than a liability M.A.C.A.No.47/2015 8 arising under the Workmen 's Compensation Act, 1923 (for short '1923 Act'). The claimant was admittedly not driving the vehicle. Appellant alleged that merely because he was travelling in a cabin would not make his case different from any other gratuitous passenger. In _**Saju P.**_ ## _**Paul 's case (supra) ,**_ Apex court held as follows: “ 17. In the present case, Section 147 as originally existed in 1988 Act is applicable and, accordingly, the judgment of this Court in Asha Rani1 is fully attracted. The High Court was clearly in error in reviewing its judgment and order delivered on 09.11.2010 in review petition filed by the claimant by applying Section 147(1)(b)(i). The High Court committed grave error in holding that Section 147(1) (b)(i) takes within its fold any liability which may be incurred by the insurer in respect of the death or bodily injury to any person. The High Court also erred in holding that the claimant was travelling in the vehicle in the course of his employment since he was a spare driver in the vehicle although he was not driving the vehicle at the relevant time but he was directed to go to the worksite by his employer. The High Court erroneously assumed that the claimant died in the course of employment and overlooked the fact that the claimant was not in any manner engaged on the vehicle that met with an accident but he was employed as a driver in another vehicle owned by M/s. P.L. Construction Company. The insured (owner of the vehicle) got insurance cover in respect of the subject goods vehicle for driver and cleaner only and not for any other employee. There is no insurance cover for the M.A.C.A.No.47/2015 9 spare driver in the policy. As a matter of law, the claimant did not cease to be a gratuitous passenger though he claimed that he was a spare driver. The insured had paid premium for one driver and one cleaner and, therefore, second driver or for that purpose 'spare driver ' was not covered under the policy. 18. The High Court misconstrued the proviso following sub-section (1) of Section 147 of the 1988 Act. What is contemplated by proviso to Section 147 (1) is that the policy shall not be required to cover liability in respect of death or bodily injury sustained by an employee arising out of and in the course of his employment other than a liability arising under the Workmen 's Compensation Act, 1923. The claimant was admittedly not driving the vehicle nor he was engaged in driving the said vehicle. Merely because he was travelling in a cabin would not make his case different from any other gratuitous passenger. “ 7. Now the question is whether all the employees of the vehicle would come within the ambit of employee u/s.147(1). A reading of the Section shows that the liability of the insurer with regard to the employee is restricted to the compensation payable under the Workmen's Compensation Act, 1923. The categories of employees permissible under the Section specifically mentioned in proviso (i) (a) (b) and(c) of Section 147(1) M.A.C.A.No.47/2015 10 are driver of the vehicle or the conductor of the vehicle, if it is a public service vehicle engaged as a conductor of the vehicle or in examining tickets in the vehicle or if it is a goods carriage, being carried in the vehicle or to cover any contractual liability. The learned counsel appearing for the first respondent submitted that clause (c) has to be interpreted in wide sense and it has special importance other than owner of the goods or his authorised representative carried in the vehicle or employees. But when additional premium is collected for non-fare **.** passengers it will cover the contractual liability Similarly, a policy is not required to cover the liability of the employee except an employee covered under the 1923 Act and that too in respect of an employee carried in a vehicle. To put it differently, it does not cover all kinds of employees. This position has been explained by the Apex Court in _**Sanjeev Kumar Samarat**_ v. _**National Insurance Co.Ltd and others**_ [AIR 2013 Sc 1125]. Thus, on a reading M.A.C.A.No.47/2015 11 of the above decision and analysis of the 1923 Act, it is quite transparent that the statutory policy only covers the employees of the insured, either employed or engaged by him in a goods carriage. It does not cover any other kind of employee and therefore, someone who travels not being an authorised agent in place of the owner of goods, and claims to be an employee of the owner of goods, cannot be covered by the statutory policy. 8. In this context, it is profitable to refer the decision of the Apex Court in _**Sanjeev Kumar Samrat's case**_ ## _**(supra)**_ ] which reads as follows: “It is worthy to note that sub-clause (i)(c) refers to an employee who is being carried in the vehicle covered by the policy. Such vehicle being a goods carriage, an employee has to be covered by the statutory policy. On an apposite reading of Sections 147 and 167 the intendment of the Legislature, as it appears to us, is to cover the injury to any person including the owner of the goods or his authorised representative carried in a vehicle and an employee who is carried in the said vehicle. It is apt to state here that the proviso commences in a different way. A policy is not required to cover the liability of the employee except an employee covered under the 1923 Act and that too in respect of an employee carried in a M.A.C.A.No.47/2015 12 vehicle. To put it differently, it does not cover all kinds of employees. Thus, on a contextual reading of the provision, schematic analysis of the Act and the 1923 Act, it is quite limpid that the statutory policy only covers the employees of the insured, either employed or engaged by him in a goods carriage. It does not cover any other kind of employee and therefore, someone who travels not being an authorised agent in place of the owner of goods, and claims to be an employee of the owner of goods, cannot be covered by the statutory policy and to hold otherwise would tantamount to causing violence to the language employed in the Statute. Therefore, we conclude that the insurer would not be liable to indemnify the insured. 9. It is stated in Ext.B3 policy that an additional premium was collected for non-fare passengers. The learned counsel for the appellant contended that even if additional premium is collected, the 1[st] respondent is not a person coming under the Workmen's Compensation Act 1923. My attention has been drawn to the Indian Motor Tariff Rate (IMT 37) which reads as follows: ## “ **IMT 37 Legal Liability to Non-Fare Paying Passengers other than Statutory Liability except the Fatal Accidents Act, 1855 (Commercial Vehicles only).** i) Any employee of the within named insured who is not a workman within the meaning M.A.C.A.No.47/2015 13 of the Workmen's Compensation Act Prior to date of this endorsement and not being carried for the hire or reward. ii) Any other person not being carried for hire or reward provided that the person is a) charterer or representative of the charterer of the truck. b) Any other person directly connected with the journey in one from or other being carried in or upon or entering or mounting or alighting from any Motor Vehicle described in the schedule of the policy. Subject otherwise to the terms exceptions conditions and limitation of this policy. Keeping in view the aforesaid contractual liability, it is better to see how the term “employee” has been used under S.147 of the Act. The meaning becomes absolutely plain and clear that employee which is statutorily covered by the insured alone covers the employees employed or engaged by the employer according to the policy. It is the settled principle of law that the liability of an insurer for payment of compensation could be either statutory or contractual. Moreover S.147 says that the owner of the vehicle is free to obtain a policy of insurance providing wider coverage. In short, the liability would arise M.A.C.A.No.47/2015 14 according to its contractual nature and as per the Indian Motor Tariff Rate, non-fare passenger is covered subject to the terms, exceptions, conditions and limitations of the policy. Ext.B3 policy shows that the insured got insurance cover in respect of goods vehicle only for driver and cleaner and not for any spare driver. 10. In the instant case, the 1[st] respondent was travelling in the cabin before the accident. Merely because he was travelling in the cabin would not save him different from any other gratuitous passenger. The evidence in this case shows that PW1 was working in the lorry as Cleaner-cum-Driver. On 31.1.2004 at 10 a.m., when he got down from the lorry at Mallappally junction, the driver took the lorry to reverse side, as a result the left portion of the lorry hit against him, he fell down and sustained serious injury. The learned counsel for the appellant submitted that in the private complaint, the 1[st] respondent took a contention that while he was travelling M.A.C.A.No.47/2015 15 in the vehicle, the driver of the vehicle applied brake and driven the vehicle in reverse direction, as a result he was thrown out of the lorry, but in the police report and in the oral evidence, it is found that the injured got down from the lorry and was proceeding through the road, the driver reversed the vehicle and hit against his body and he sustained injury. If that being the position, it is pertinent to note that when PW1 got down from the vehicle and proceeded through the road, he became a 'third party' and not an employee of the vehicle. As a matter of law, the claimant did not cease to be a third party though he was a cleaner-cum-driver travelled in a lorry immediately before the accident. Therefore, the contention that the 1[st] respondent being a gratuitous passenger in a lorry, not covered as per Ext.B3 policy and he was travelling in the lorry at the time of accident as a workman is unsustainable in law. The accident occurred while he was walking through the road and being a third party, he is M.A.C.A.No.47/2015 16 entitled to get compensation as fixed by the tribunal. For the foregoing reason, I do not see any reason to interfere with the award passed by the tribunal. There is no merit in this appeal and it is dismissed accordingly. **P.D. RAJAN, JUDGE.** acd