Jagannathan, J.:—
These two appeals by the United India Insurance Company are directed against the award of the M.A.C.T, Bagalakote, allowing the claim applications filed by one Akkawa (claimant in M.V.C No. 34/2002) and one Neelawwa (claimant in M.V.C No. 811/2001) and as the accident in question is one and the same, these two appeals are disposed of by this common judgment.
2. The case of the respective claimants is that on 21.8.2001, when they, along with several others, were travelling in the tractor-cum-trailer No. KA-28.T-1170 & 1171 on Bagalakote-Alamatti Road, the vehicle, being driven in a rash and negligent manner by the driver concerned, turned turtle leading to the above named claimants suffering injuries along with many others, who were also in the said vehicle. The claim petitions filed by the claimants mentioned above came to be allowed and claimant Akkawa was awarded a sum of Rs. 75,500/- and the other claimant Neelawwa was awarded a sum of Rs. 26,250/- by the M.A.C.T as compensation, putting the liability on the appellant to satisfy the award amounts.
3. The said order of the M.A.C.T is called in question mainly on the ground that the tractor-cum-trailer, though insured with the appellant, the policy issued was one coming under the farmer's package and, therefore, the appellant is not liable to pay the compensation because the claimants were found travelling in the tractor-cum-trailer and the vehicle was not being used for agricultural purposes and farmer's policy did not cover the risk of any other persons except those mentioned in the policy itself. Therefore, the question of the Insurance Company becoming liable will not arise. Another ground urged in the appeals is that, as the vehicle was used as a transport vehicle to carry the claimants as well as many others, the insured ought to have obtained necessary permit as required under Section 66 of the Motor Vehicles Act, 1988 no such permit was obtained by the insured. The claimants and others, who were found travelling in the tractor-cum-trailer, were never the employees of the insured and, as such, the question of covering the risk of the claimants even under Section 147 of the Act will not arise. It is on these grounds, the awards of the Tribunal are being assailed in these two appeals.
4. I have heard the arguments advanced by the learned counsel Shri A.N Krishna Swamy for the appellant and the learned senior Counsel Shri S.P Shankar for R-2 and the learned counsel Shri Babu H. Metagudda for R-1. As the points raised in the course of the arguments were of such nature, the learned counsel for R-1 was also assisted by the learned counsel Shri Manjunath Udupa.
5. The learned counsel for the appellant contended that the tractor along with the trailer together constituted a goods vehicle and, as such, it was incumbent on the part of the insured to have obtained necessary permit as required under Section 66 of the Act and no such permission was obtained in the instant case and, therefore, there is clear violation of the requirement of law on the part of the insured. The vehicle in question was used for the purpose other than agricultural purpose and therefore, no liability will fall on the insurer in view of the nature of the policy taken out by the insured. The risk of the claimants also is not covered by the policy in question and it is nobody's case that the two claimants herein were the employees engaged in the vehicle in question by the insured or that the two claimants were actually employed in the vehicle for the purpose of carrying out the agricultural operation. It is not the case of the claimants that they were actually employed in the vehicle. Therefore, Section 147 of the M.V Act has no application to the case on hand. In support of the above submission, the learned Counsel place reliance on the decisions of the Apex Court reported in 2004 ACJ 2094, 2003 ACJ 1550, and 2006 ACJ 1 and also the decision of this Court reported in ILR 2006 KAR 1498.
6. On the other hand, the learned Senior Counsel Shri S.P Shankar appearing for respondent No. 2 insured contended that the evidence of R.W 1, officer of the insurance company cannot be looked into as the same is not in accordance with Order 18 Rule 4 of CPC. Secondly, it is submitted that out of four cases in which the Tribunal has passed the award, the appellant-insurance company has satisfied the award in two cases and therefore, it is not open to the appellant to take a stand that it is not liable. The learned Counsel also place reliance on the decision of the Apex Court reported in (1987) 2 SCC 654 : AIR 1987 SC 1184 and drew my attention to pages 1190 and 1191, emphasizing the object behind the enactment of the M.V Act.
7. On behalf of the respondents-claimants, the learned Counsel Shri Babu H. Metagudda submitted that the policy in question is a comprehensive policy and therefore, the risk of the claimants is covered by the said policy and as per Rule 100 of the Motor Vehicles Rules, there is compulsory coverage of six persons plus driver and therefore, the risk of the claimants herein is deemed to have been covered by the policy in question. Reference was made to the decision of the Apex Court in Bhimavva's case reported in 2005 ACJ 301 and also to the decision of this Court in the case reported in 1996 (1) KLJ 417, 1992 ACJ 1083 and 2005 ACJ 805 (Thippeswamy) and also the decision rendered in M.F.A No. 1870/2005.
8. The learned Counsel Shri Manjunath Udupa assisting the Counsel for the claimants placed reliance on the decision of the Apex Court reported in 2005 (6) SCC 172 and 2001 ACJ 1410 and another unreported decision of this Court in M.F.A No. 1865/2002. Particularly, reference was made to Section 147 to contend that the policy shall not be required to cover the liability of an employee of the insured being carried in a goods carriage vehicle. Therefore, in the instant case, although policy on the face of it does not cover the risk of the two claimants herein, in view of Section 147 of the M.V Act, the risk is deemed to have been covered as they were the employees of the insured.
9. In the light of the contentions put forward as above and having gone through all the decisions referred to by the Counsel for the parties, the point that arises for consideration is “whether the appellant is liable to pay compensation to two claimants herein above having regard to the nature of policy that is taken out by the insured in the instant case?”.
10. It is not in dispute that the policy in question which has been marked as Ex. R1 in the evidence of R.W.I is a farmer's package insurance policy. It is also not in dispute that the said Ex. R1 does not cover the risk of any coolie as such and it only covers the risk of the insured himself and his vehicle, i.e, the tractor cum trailer as well as the risk in respect of building of Class-A constructions and the contents excluding jewellery and valuables. Therefore, having regard to the nature of the policy taken out by the insured and the said policy being the standard policy forming the basis of contract between the insured and the insurance company, the question for consideration will be whether the said policy covers the risk of the two claimants herein who were found travelling with several other persons in the trailer in question on the date of the accident.
11. R.W 1 one Mr. Milind, Manager of the insurance company in the course of his evidence has deposed to the effect that the tractor cum trailer having been covered by the farmer's package insurance, cannot be used for carrying coolies or unauthorised passengers and it is his evidence that the claimants and other persons travelled as unauthorised passengers in the trailer on that day and the insured had not paid additional premium to cover the risk of such persons. He has denied the suggestion that the policy being the comprehensive policy will also cover the risk of the coolies. Thus, the evidence of R.W 1 read with Ex. R1 insurance policy makes it clear that the policy was issued only in respect of a vehicle used for agricultural purposes and the said policy did not cover use of tractor cum trailer either for hire or reward.
12. It is also not in dispute that in the instant case the insured had not obtained any permit to use the tractor cum trailer for the purposes other than agricultural purposes. The very fact that the tractor cum trailer was used to carry number of persons, which is put at 60 to 70 by the witnesses examined before the MACT, it is therefore established that the tractor was used as a transport vehicle to carry large number of persons. As such, the insured ought to have taken necessary permit as required under Section 66 of the M.V Act. The said Section 66(1) reads as follows:
“Necessity for permits-No owner of a motor vehicle shall use or permit the use of the vehicle as a transport vehicle in any public place whether or not such vehicle is actually carrying any passengers or goods save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority or any prescribed authority authorising him the use of the vehicle in that place in the matter in which the vehicle is being used:
Provided that a stage carriage permit shall, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a contract carriage:
Provided further that a stage carriage permit may, subject to any conditions that may be specified in the permit, authorise the use of the vehicle as a goods carriage either when carrying passengers or not:
Provided also that a goods carriage permit shall, subject to any conditions that may be specified in the permit, authorise the holder to use the vehicle for the carriage of goods for or in connection with a trade or business carried on by him”.
13. Therefore, in the instant case, no such permit was obtained by the insured to use the tractor cum trailer as a transport vehicle to carry 60 to 70 persons. Thus, there has been violation of the provisions of the M.V Act in so far as the necessity to obtain permit is concerned. The Apex Court in the case of New India Assurance Company Limited v. Asharani . AIR 2002 SCW 5299. has observed that Section 149(2) of the 1988 Act enables the insurers to raise defences against the claim of the claimants. In terms of Clause (c) of sub-section 2 of Section 149 of the Act one of the defences which is available to the insurer is that the vehicle in question has been used for a purpose not allowed by the permit under which the vehicle was used. In the case on hand, the permit itself was not there and therefore, the position is still worst than the vehicle being used for the purpose which is not allowed by the permit.
14. In the decision reported in National Insurance Company Limited v. V. Chinnamma . 2004 ACJ 1909., reported in the Apex Court has observed that the Insurance Company will not be liable if vegetables are carried in a tractor for being transported to the market for sale and such an use of the vehicle cannot be termed as use of the tractor for agricultural purpose and hence the Court held that the vehicle was not used for agricultural purpose. In the very same decision at paragraph No. 15 of the judgment, it has been observed thus:
“A tractor fitted with trailer may or may not answer the definition of ‘goods carriage’ contained in Section 2(14) of the Motor Vehicles Act. The tractor was meant to be used for agricultural purposes. The trailer attached to the tractor, thus necessary is required to be used for agricultural purposes, unless registered otherwise. It may be, as has been contended by Mrs. K. Sharda Devi, that carriage of vegetables being agricultural produce would lead to an inference that the tractor was being used for agricultural purposes but the same by itself would not be construed to mean that the tractor and trailer can be used for carriage of goods by another person for his business activities. The deceased was a businessman. He used to deal in vegetables. After he purchased the vegetables, he was to transport the same to market for the purpose of sale thereof and not for any agricultural purpose. Tractor and trailer, therefore, were not being used for agricultural purposes”
15. In another decision in the case of New India Assurance Company Limited v. Sandepudi Mariyamma . 2004 ACJ 1692., the High Court of Andhra Pradesh has referred to number of decisions concerning the policy issued in respect of agricultural purposes. After referring to several decisions, it has been held that when the policy covered the tractor-trailer with a condition to use for agricultural purposes only and the policy did not cover use of the vehicle for hire or reward, the insurance company will not be liable where the owner had given the vehicle for hire and it has been used for transporting slabs for construction house.
16. The effect of the above decisions is that a vehicle, which is insured for agricultural purpose, cannot be used for any other purpose and if so used in contravention of the policy taken, the insurance company will not be liable. Coming to the decisions referred to by the learned Counsel for the claimants as well as insured are concerned, the decision in M.F.A No. 2545/2003 of this Court concerns a person travelling as a loader in the tractor cum trailer and therefore, the Court observed that the claimants are entitled for compensation as per the W.C Act. At the same time, it was observed in the said decision at paragraph No. 6 that the insurer has not placed any evidence before the Court to show that it is an agricultural tractor-trailer. The facts therefore are different from the one with which we are concerned, because in the instant case, the policy Ex. R1 clearly indicates that the tractor-cum trailer was to be used only for agricultural purpose and for no other purpose.
17. As regards the decision reported in 1996 (1) KLJ 417 is concerned, that was a case in which the policy in question was not a policy of the nature that is taken out by the insured in the instant case. Therefore, referring to Rule 100(1) of the M.V Act, 1989, this Court had held that the insurer cannot be absolved of liability to pay compensation as statutory requirement is to cover the risk of six employees apart from the driver. The said decision therefore, is not applicable to the case on hand. Similar is the situation in the case of Bhimawa v. Shankar, in as much as in the said case, the Court held that the insurance company will be liable to the extent of liability under the W.C Act in respect of employees travelling in the goods vehicle. Thus, we see the facts are quite different and it is not a case of a tractor cum trailer being used for agricultural purposes.
18. In the decision of the Apex Court in the case of Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan . 1987 2 SCC 654 the Apex Court has referred to the intention behind the passing of the M.V Act and has observed that the said act is a benevolent legislation and therefore, the legislation has made it obligatory that no more vehicle shall be used unless third party insurance is in place. The facts are concerned, that was the case where the vehicle in question was left with his engine running in the control of the cleaner and that led to the accident. In the instant case, we are concerned with use of the tractor-cum-trailer for the purpose other than agricultural purposes.
19. Concerning the submission of the learned senior counsel that the evidence of RW 1 should not be looked into because it is in violation of Order 18 Rule 4 of the CPC, I do not find any merit in the said ground urged because not only RW1 has been examined before the MACT, but even the claimants have given their evidence by way of affidavit so far as examination-in-chief is concerned. It is, therefore, not possible to ignore the evidence of RW1, but accepted the evidence of the claimants though they also give evidence by way of affidavit. The learned senior counsel also referred to the evidence of RW1 in regard to which the Tribunal has observed in paragraph No. 12 of its order that since Ex. R-1 is the farmer's package insurance and the same being comprehensive policy, the coolies travelling in the tractor-trailer are covered under the said insurance policy. Having carefully examined the evidence of RW1, I do not find any such statement being made by RW1 in the course of his evidence and therefore, the said observation of the Tribunal is wholly incorrect.
20. As regards the contention that the policy being comprehensive in nature and therefore, the insurer is liable to cover the risk of the claimants is concerned, though the said submission was made by the learned counsel for the claimants, I do not find any merit in the said submission also because the use of the expression comprehensive policy does not itself give room to take the view that such a policy will cover the risk of anybody and every body under the sun.
21. What is meant by a comprehensive policy has been explained by the Apex Court in the case of New India Assurance Co. Ltd. v. C.M Jaya . 2002 1 ACJ 271. by observing that the comprehensive policy merely means that the loss sustained by such person or class of persons specified in the policy will be payable upto the insured amount irrespective of the actual liability suffered. Therefore, on the said line of reasoning, it was held that merely because the policy is a comprehensive policy, it would not cover the risk of a khalasi.
22. The next submission of the learned counsel for the claimants that it has been admitted by RW1 that the risk of the claimants is covered by the policy is concerned, RW1 has clearly stated in the course of his evidence that the risk of the coolies is not covered by the farmer's package policy.
23. There is no evidence to indicate that the two claimants herein were the employees of the insured. Neither the claimants Akkawwa nor Neelawwa has stated before the MACT that they were the employees of the insured. On the other hand, the evidence of these two witnesses gives the impression that they along with several others numbering 30 to 40 according to one claimant and numbering 60 to 70 according to another claimant were all travelling in the trailer in order to go for coolie work at a place called Araladinni. The claimant Akkawwa examined as PW1 in MVC No. 34/02 out of which the appeal No. 6959/2003 arises has gone to the extent of stating that she and others travelled in the trailer in order to do coolie work after going to the land. She further admits that in the trailer, passengers are not allowed to travel. Although the insured has not entered the witness box before the MACT, the statement filed by him also does not give the impression that the claimants were the employees under the insured. In fact, he has denied the said relationship between him and the claimants.
24. Therefore, when the claimants have not been able to establish that they were the employees engaged by the insured in connection with the tractor-cum-trailer which is used for agricultural purpose, the risk of such persons therefore, does not require to be covered by the insurer notwithstanding the provisions of law as contended under Section 157 of the M.V Act.
25. In this connection, it is pertinent to refer to the decision of this court in the case of United India Insurance Company Limited v. Hanumanthappa . ILR 2006 KAR 1498.. In the said decision, it has been held that there is no statutory liability on the part of the insurer to cover the risk of all types of employees of the insured owning a motor vehicle, but only such of those employees within the meaning of workmen under the W.C Act will have to be covered compulsorily. Therefore, the employees who are employed in connection with the motor vehicle as defined under Section 2(n) will have the benefit of statutory coverage and the court also further held that on fact as the deceased and insured were not the employees employed in connection with the motor vehicle, but employed for agricultural work, the award against the insurer is bad in law. While laying down the above law, this court also placed reliance on the decision of the Apex Court in National Insurance Company Limited v. V. Chinnamma (Supra).
26. Yet another decision referred to by the learned counsel for the claimants concerning Section 39 of the M.V Act has no application to the case on hand for the reasons already stated, as we are concerned with a motor vehicle which is insured under the farmer's package policy and meant for agricultural purposes only, the use of the said tractor-cum-trailer to carry number of persons who are going for coolie work therefore, is contrary to the very purpose for which the policy was issued.
27. Thus, to conclude, the policy in question that is Ex. R-1 is a policy in the nature of farmer's package policy insurance, covering the risk of only those persons mentioned in the policy and the said vehicle was used in contravention of Section 66 of the Motor Vehicles Act.
28. For the foregoing reasons and having regard to the law laid down by the Apex Court and also by this Court in respect of a policy which is issued for the use of vehicle for agricultural purpose, in the instant case, as there has been a violation of the policy conditions by the insured and as the claimants having failed to establish that they were the employees engaged in connection with use of the tractor-cum-trailer for agricultural purpose only, the Tribunal could not have saddled the liability on the appellant-insurance company.
29. Last of the contentions urged by the learned Senior Counsel Sri. S.P Shankar is that the insurance company has already satisfied the award in two cases and therefore, in the present cases also the appellant is liable. I do not find any force in the said submission, because, as rightly pointed out by the learned counsel Sri. A.N Krishnaswamy for the appellant, in the two cases in regard to which the award has been satisfied by the appellant, they are related to quantum of compensation which is less than Rs. 10,000/-. Therefore, when no appeal can be filed in respect of the award amount which is less than Rs. 10,000/-, non-challenge of the award in such cases does not ipso facto leads to the inference that the insurer has admitted the liability in all cases. Therefore, the said ground also lacks merit.
30. In the result, I pass the following order:
The two appeals are allowed and the impugned award of the MACT fastening the liability on the appellant to satisfy the award amount are set aside and the amount in deposit be refunded to the appellant-insurance company. It is also made clear that the liability will be on the insured to pay the compensation to the claimant.