Full Judgment Text
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CASE NO.:
Appeal (civil) 16 of 2004
PETITIONER:
M/s. National Insurance Co. Ltd.
RESPONDENT:
Baljit Kaur and Ors.
DATE OF JUDGMENT: 06/01/2004
BENCH:
CJI., V. N. Khare,S.B. Sinha & Dr. AR. Lakshmanan.
JUDGMENT:
JUDGMENT
(Arising out of S.L.P. [C] No. 17763 of 2001)
WITH
CIVIL APPEAL NO. 17/04 (@ SLP (C) No. 17837/01)
CIVIL APPEAL NO. 18/04 (@ SLP (C) No. 18027/01)
CIVIL APPEAL NO. 20/04 (@ SLP (C) No. 5220/02)
CIVIL APPEAL NO. 27/04 (@ SLP (C) No. 5225/02)
CIVIL APPEAL NO. 28/04 (@ SLP (C) No. 6045/02)
CIVIL APPEAL NO. 26/04 (@ SLP (C) No. 6046/02)
CIVIL APPEAL NO. 25/04 (@ SLP (C) No. 6047/02)
CIVIL APPEAL NO. 24/04 (@ SLP (C) No. 6048/02)
CIVIL APPEAL NO. 23/04 (@ SLP (C) No. 6049/02)
CIVIL APPEAL NO. 22/04 (@ SLP (C) No. 6050/02)
CIVIL APPEAL NO. 21/04 (@ SLP (C) No. 6051/02)
V.N. KHARE, CJI.
Leave granted.
The question that arises for consideration in these appeals is whether
an insurance policy in respect of a goods vehicle would also cover gratuitous
passengers, in view of the legislative amendment in 1994 to Section 147 of
the Motor Vehicles Act, 1988.
The first respondent herein preferred a claim petition for
compensation before the Motor Accident Claims Tribunal, Ludhiana
(hereinafter referred to as ’the Claims Tribunal’), in view of the death of her
sixteen year old son, Sukhwinder Singh, due to the allegedly reckless driving
by the second respondent and driver of the goods vehicle, bearing Number
PB-10U-8937, on February 19, 1999. It was found by the Claims Tribunal
that the victim, who was returning in the truck from a marriage ceremony,
died as a result of the rash and negligent driving by the driver of the goods
vehicle, the second respondent herein. It was an admitted fact that the said
vehicle was insured with the appellant insurance company.
The Claims Tribunal relying upon the decision of this Court in New
India Assurance Co. v. Satpal Singh (2000) 1 SCC 237, accepted the claim
petition, and rejected the contention of the appellant insurance company that
the concerned vehicle being a goods vehicle, it would not have to incur any
liability with respect to passengers transported in the vehicle. It further
directed the appellant to pay an amount of Rs.1,32,000/- as compensation,
with interest at the rate of 9% from the date of application. The High Court
upheld the verdict of the Claims Tribunal on appeal, with the further
direction that in the event the owner, the third respondent herein, had
committed any breach, the appellant insurer would be entitled to recover the
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amount of compensation from him.
It may be noticed at the outset that the Judgment rendered in Satpal
Singh case (supra) has been subsequently reversed by a three-judge Bench
of this Court in New India Assurance Co. Ltd. Vs. Asha Rani (2003) 2 SCC
223, which was followed in the case of Oriental Insurance Co. Ltd. Vs.
Devireddy Konda Reddy (2003) 2 SCC 339.
Reference in this connection may also be made to National Insurance
Co. Ltd. v. Ajit Kumar and Others [JT 2003 (7) SC 520].
In the case of New India Assurance Co. Ltd. Vs. Asha Rani (Supra),
it was held that the previous decision in Satpal Singh Case, was incorrectly
rendered, and that the words "any person" as used in Section 147 of the
Motor Vehicles Act, 1988, would not include passengers in the goods
vehicle, but would rather be confined to the legislative intent to provide for
third party risk. The question in the subsequent judgment in Oriental
Insurance Co. Ltd. Vs. Devireddy Konda Reddy (supra), involved, as in the
present case, the liability of the insurance company in the event of death
caused to a gratuitous passenger traveling in a goods vehicle. The Court
held that the Tribunal and the High Court were not justified in placing
reliance upon Satpal Singh case (supra), in view of its reversal by Asha
Rani (supra), and that, accordingly, the insurer would not be liable to pay
compensation to the family of the victim who was traveling in a goods
vehicle.
It was contended by the learned counsel appearing on behalf of the
second and third respondents, the driver and owner of the vehicle
respectively, that the decision in Asha Rani case (supra) and Konda Reddy
case (supra) were delivered with respect to the position prevailing prior to
the amendment of Section 147 by the Motor Vehicles (Amendment) Act,
1994. As such, the effect of the legislative amendment was not in question
in the above cases, and therefore, the law laid down by these decisions
would not be considered as binding law in view of coming into force of the
said amendment. Since the accident in the present instance occurred in
1999, this Court would now have to consider afresh the impact of the 1994
amendment, and could not consider itself circumscribed by the
aforementioned decisions in the Asha Rani case (supra) and Konda Reddy
case (supra) which both involved motor accidents predating the said
amendment.
It is the submission of the respondent vehicle owner and driver that
the insertion, by way of legislative amendment, of the words "including
owner of the goods or his authorized representative carried in the vehicle" in
Section 147 would result in the inference that gratuitous passengers would as
well be covered by the scope of the provision. Any other construction, it
was urged by the learned counsel for the second and third respondents,
would render the effect of the words "any person" as completely redundant.
The material portion of the provision contained in Section 147 of the
Motor Vehicles Act, 1988, as amended by the Motor Vehicles (Amendment)
Act, 1994 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)
(b) insures the person or classes of persons
specified in the policy to the extent specified in sub-
section (2) \026
(i) against any liability which may be
incurred by him in respect of the
death of or bodily injury to any
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person, including owner of the goods
or his authorized 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) *"
(emphasis added)
Admittedly, it is incumbent upon a Court of law to eschew that
interpretation of a statute that would serve to negate its true import, or to
render the words of any provision as superfluous. Nonetheless, we find no
merit in the above submissions proffered by the learned counsel for the
respondent. The effect of the 1994 amendment on Section 147 is
unambiguous. Where earlier, the words "any person" could be held not to
include the owner of the goods or his authorized representative travelling in
the goods vehicle, Parliament has now made it clear that such a construction
is no longer possible. The scope of this rationale does not, however, extend
to cover the class of cases where gratuitous passengers for whom no
insurance policy was envisaged, and for whom no insurance premium was
paid, employ the goods vehicle as a medium of conveyance.
We find ourselves unable, furthermore, to countenance the contention
of the respondents that the words "any person" as used in Section 147 of the
Motor Vehicles Act, would be rendered otiose by an interpretation that
removed gratuitous passengers from the ambit of the same. It was observed
by this Court in the case concerning New India Assurance Co. Ltd. Vs.
Asha Rani (supra) that the true purport of the words "any person" is to be
found in the liability of the insurer for third party risk, which was sought to
be provided for by the enactment.
It is pertinent to note that a statutory liability enjoined upon an owner
of the vehicle to compulsorily insure it so as to cover the liability in respect
of a person who was travelling in a vehicle pursuant to a contract of
employment in terms of proviso (ii) appended to Section 95 of the 1939 Act
does not occur in Section 147 of the 1988 Act. The changes effected in the
1988 Act vis-‘-vis the 1939 Act as regard definitions of ’goods vehicle’,
’public service vehicle’ and ’stage carriage’ have also a bearing on the subject
inasmuch as the concept of any goods carriage carrying any passenger or
any other person was not contemplated.
In a situation of this nature, the doctrine of suppression of mischief
rule as adumbrated in Heydon’s case [3 Co Rep 7a, 76 ER 637] shall apply.
Such an amendment was made by the Parliament consciously. Having
regard to the definition of ’goods carriage’ vis-‘-vis ’public service vehicle’, it
is clear that whereas the goods carriage carrying any passenger is not
contemplated under the 1988 Act as the same must be used solely for
carrying the goods.
In Halsbury’s Laws of England, Volume 44(1), fourth reissue, para
1474, pp 906-07, it is stated :
"Parliament intends that an enactment shall
remedy a particular mischief and it is therefore
presumed that Parliament intends that the court,
when considering, in relation to the facts of the
instant case, which of the opposing constructions
of the enactment corresponds to its legal meaning,
should find a construction which applies the
remedy provided by it in such a way as to suppress
that mischief. The doctrine originates in Heydon’s
case where the Barons of the Exchequer resolved
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that for the sure and true interpretation of all
statutes in general (be they penal or beneficial,
restrictive or enlarging of the common law), four
things are to be discerned and considered :
(1) what was the common law before the
making of the Act;
(2) what was the mischief and defect for which
the common law did not provide;
(3) what remedy Parliament has resolved and
appointed to cure the disease of the
commonwealth; and
(4) the true reason of the remedy,
and then the office of all the judges is always to
make such construction as shall :
(a) suppress the mischief and advance the
remedy; and
(b) suppress subtle inventions and
evasions for the continuance of the
mischief pro privato commodo (for
private benefit); and
(c) add force and life to the cure and
remedy according to the true intent of
the makers of the Act pro publico (for
the public good)."
Heydon’s Rule has been applied by this Court in a large number of
cases in order to suppress the mischief which was intended to be remedied as
against the literal rule which could have otherwise covered the field. [See for
example, Smt. PEK Kalliani Amma and Others vs. K. Devi and Others,
[AIR 1996 SC 1963; Bengal Immunity Co. Ltd. vs. State of Bihar and
Others, AIR 1955 SC 661; and Goodyear India Ltd. vs. State of Haryana and
Another, AIR 1990 SC 781].
By reason of the 1994 Amendment what was added is "including the
owner of the goods or his authorised representative carried in the vehicle".
The liability of the owner of the vehicle to insure it compulsorily, thus, by
reason of the aforementioned amendment included only the owner of the
goods or his authorised representative carried in the vehicle besides the third
parties. The intention of the Parliament, therefore, could not have been that
the words ’any person’ occurring in Section 147 would cover all persons who
were travelling in a goods carriage in any capacity whatsoever. If such was
the intention there was no necessity of the Parliament to carry out an
amendment inasmuch as expression ’any person’ contained in sub-clause (i)
of clause (b) of sub-section (1) of Section 147 would have included the
owner of the goods or his authorised representative besides the passengers
who are gratuitous or otherwise.
The observations made in this connection by the Court in Asha Rani
case (supra) to which one of us, Sinha, J, was a party, however, bear
repetition:
"26. In view of the changes in the relevant
provisions in the 1988 Act vis-‘-vis the 1939 Act,
we are of the opinion that the meaning of the
words "any person" must also be attributed having
regard to the context in which they have been used
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i.e. "a third party". Keeping in view the provisions
of the 1988 Act, we are of the opinion that as the
provisions thereof do not enjoin any statutory
liability on the owner of a vehicle to get his vehicle
insured for any passenger traveling in a goods
vehicle, the insurers would not be liable therefor."
In Asha Rani (supra), it has been noticed that sub-clause (i) of clause
(b) of sub-section (1) of Section 147 of the 1988 Act speaks of liability
which may be incurred by the owner of a vehicle in respect of death of or
bodily injury to any person or damage to any property of a third party caused
by or arising out of the use of the vehicle in a public place. Furthermore, an
owner of a passenger-carrying vehicle must pay premium for covering the
risks of the passengers travelling in the vehicle. The premium in view of the
1994 Amendment would only cover a third party as also the owner of the
goods or his authorised representative and not any passenger carried in a
goods vehicle whether for hire or reward or otherwise.
It is therefore, manifest that in spite of the amendment of 1994, the
effect of the provision contained in Section 147 with respect to persons
other than the owner of the goods or his authorized representative remains
the same. Although the owner of the goods or his authorized representative
would now be covered by the policy of insurance in respect of a goods
vehicle, it was not the intention of the legislature to provide for the liability
of the insurer with respect to passengers, especially gratuitous passengers,
who were neither contemplated at the time the contract of insurance was
entered into, nor any premium was paid to the extent of the benefit of
insurance to such category of people.
The upshot of the aforementioned discussions is that instead and in
place of the insurer the owner of the vehicle shall be liable to satisfy the
decree. The question, however, would be as to whether keeping in view the
fact that the law was not clear so long such a direction would be fair and
equitable. We do not think so. We, therefore, clarify the legal position
which shall have prospective effect. The Tribunal as also the High Court had
proceeded in terms of the decisions of this Court in Satpal Singh (supra).
The said decision has been overruled only in Asha Rani (supra).
We, therefore, are of the opinion that the interest of justice will be sub-
served if the appellant herein is directed to satisfy the awarded amount in
favour of the claimant if not already satisfied and recover the same from the
owner of the vehicle. For the purpose of such recovery, it would not be
necessary for the insurer to file a separate suit but it may initiate a
proceeding before the executing court as if the dispute between the insurer
and the owner was the subject matter of determination before the tribunal
and the issue is decided against the owner and in favour of the insurer. We
have issued the aforementioned directions having regard to the scope and
purport of Section 168 of the Motor Vehicles Act, 1988 in terms whereof it
is not only entitled to determine the amount of claim as put forth by the
claimant for recovery thereof from the insurer, owner or driver of the vehicle
jointly or severally but also the dispute between the insurer on the one hand
and the owner or driver of the vehicle involved in the accident inasmuch as
can be resolved by the tribunal in such a proceeding.
For the aforementioned reasons, the appeals are partly allowed to the
aforementioned extent and subject to the directions aforementioned. But
there shall be no order as to costs.
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