N.D.OJHA - (1.) THIS appeal by special leave has been filed by the National Insurance Company Ltd., New Delhi, against a judgment of the Delhi High Court in an appeal under Section 110-D of the Motor Vehicles Act, 1939 (hereinafter referred to as the 'Act').
(2.) NECESSARY facts may be stated herein in a nutshell. Shri Jugal Kishore, Respondent No. 1 was, on 15/06/1969, driving a three-wheeler scooter when he met with an accident with bus No. DLP-3699, driven by Shri Rai Singh, Respondent No. 2 and owned by M/s. Delhi Janata Co-operative Transport Society Limited, Respondent No. 3. He sustained injuries consequent upon which he made a claim for compensation before the Motor Accident Claims Tribunal, Delhi against Respondents 2 and 3 and the appellant which was the insurer of the bus aforesaid. The claim of Respondent No. 1 was contested by the appellant and also by Respondent No. 3 but proceeded ex parte against Respondent No. 2. The Tribunal awarded compensation in the sum of Rs. 10,000.00 recoverable jointly and severally from the appellant and Respondent No. 3. Aggrieved by the award of the Tribunal Respondent No. 1 preferred an appeal before the High Court of Delhi and asserted that the amount of compensation awarded by the Tribunal was inadequate. His appeal was allowed by the High Court and the award was modified. The High Court awarded a sum of Rs. 1,00,000.00 as compensation to Respondent No. 1 with interest at 9 per cent per annum from the date of institution of the claim till realisation with costs against the driver as well as the owner of the bus as also against the appellant, Insurance Company. Before granting special leave this Court required the appellant to deposit Rs. 1,00,000.00 namely the amount of compensation awarded by the High Court and permitted Respondent No. 1 to withdraw the same. Special leave was granted on 14/09/1984 by the following order of this Court :- "Under the orders of this Court the appellant has deposited Rs. one lac, which is the amount of compensation awarded to the claimants. The claimants have withdrawn the amount without furnishing security. Special leave granted on condition that in the event of reversal of the decision of the High Court, the said amount shall not be refunded by the claimants. Stay of further execution of the award confirmed. It has been urged by the learned counsel for the appellant that in view of the statutory provision contained in this behalf in clause (b) of sub-section (2) of Section 95 of the Act as it stood on the date of accident namely 15/06/1969 which happens to be prior to 2/03/1970, the date of commencement of Amending Act 56 of 1969, no award in excess of Rs. 20,000.00 could have been made against the appellant. Before dealing with the submission we may point out that the policy under which the bus aforesaid was insured had not been filed either before the Tribunal or before the High Court. A photostat copy of the policy has, however, been filed in this Court and learned counsel for the respondents did not have objection to the same being admitted in evidence. Clause (b) of sub-section (2) of Section 95 of the Act as it stood at the relevant time reads as under:- "95. (1) ... ... ... . (2) Subject to the proviso to sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely :- (a) ... ... ... ... (b) where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment, in respect of persons other than passengers carried for hire or reward, a limit of twenty thousand rupees; and in respect of passengers a limit of twenty thousand rupees in all, and four thousand rupees in respect of an individual passenger, if the vehicle is registered to carry not more than six passengers excluding the driver or two thousand rupees in respect of an individual passenger, if the vehicle is registered to carry more than six passengers excluding the driver; (c) ... ... ... .
(3.) ON the plain language of the aforesaid clause (b) which applies to the instant case it is apparent that the liability of the appellant could not be in excess of Rs. 20,000.00. Learned counsel for the respondents, however, urged that notwithstanding the provision contained in this behalf in clause (b) aforesaid it was open to the insurer to take a policy covering a higher risk than contemplated by the aforesaid clause (b) and consequently the said clause had to be read subject to the terms of the policy which was taken in the instant case. We find substance in this submission in view of the decision of this Court in Pushpabai Purshottam Udeshi v. Ranjit Ginning and Pressing Co., 1977 Acc CJ 343 : (AIR 1977 SC 1735), where it was held that the insurer can always take policies covering risks which are not covered by the requirements of Section 95 of the Act. We have accordingly perused the photostat copy of the policy to ascertain whether risk for any amount higher than the amount of Rs. 20,000/- contemplated by Cl. (b) aforesaid was covered. Our attention was invited by learned counsel for the respondents to the circumstance that at the right hand corner on the top of page 1 of the policy the words "COMMERCIAL VEHICLE COMPRE-HENSIVE" were printed. On this basis and on the basis that the premium paid was higher than the premium of an "act only" policy it was urged by the learned counsel for the respondents that the liability of the appellant was unlimited and not confined to Rs. 20,000.00 only. We find it difficult to accept this submission. Even though it is not permissible to use a vehicle unless it is covered at least under an "act only" policy it is not obligatory for the owner of a vehicle to get it comprehensively insured. In case however, it is got comprehensively insured a higher premium than for an "act only" policy is payable depending on the estimated value of the vehicle. Such insurance entitles the owner to claim reimbursement of the entire amount of loss or damage suffered up to the estimated value of the vehicle calculated according to the rules and regulations framed in this behalf. Comprehensive insurance of the vehicle and payment of higher premium on this score, however, do not mean that the limit of the liability with regard to third party risk becomes unlimited or higher than the statutory liability fixed under sub-sec. (2) of S. 95 of the Act. For this purpose a specific agreement has to be arrived at between the owner and the insurance company and separate premium has to be paid on the amount of liability undertaken by the insurance company in this behalf. Likewise, if risk of any other nature for instance, with regard to the driver or passengers etc. in excess of statutory liability, if any is sought to be covered it has to be clearly specified in the policy and separate premium paid therefor. This is the requirement of the tariff regulations framed for the purpose. Coming to the photostat copy of the policy in the instant case it would be seen that S. II thereof deals with liability to third parties. Sub-section (1) minus the proviso thereto reads as hereunder :- "1. Subject to the Limits of Liability the Company will indemnify the insured against all sums including claimant's cost and expenses which the insured shall become legally liable to pay in respect of - (i) death or bodily injury to any person caused by or arising out of the use (including the loading and/or unloading) of the Motor Vehicle (ii) damage to property caused by the use (including the loading and/or unloading of the Motor Vehicle)." ;