Ram Mohan Reddy, J.:—

The insurer of the Motor Cycle bearing registration No. KA-09-EE-3947, has preferred this appeal assailing the judgment and award dated 30.09.2006 in MVC No. 235/06 on the file of the Civil Judge (Sr. Dn.) & MACT, Malavalli (for short ‘MACT’).

2. The first respondent filed a claim petition under Section 166 of the Motor Vehicles Act, 1988 (for short ‘the Act’) numbered as MVC 235/06, for Rs. 5,00,000/-, as compensation, for injuries sustained, while as a pillion rider, in an accident that occurred on 05.05.2005 due to the rash and negligent riding by the second respondent-owner of the Motor Cycle insured by the appellant. Before the MACT, the insured was arraigned as the first respondent, filed his written statement dated 01.12.05 admitting the factum of accident and injuries to the claimant, but denied the allegation of rash and negligent riding of the Motor Cycle. The appellant arraigned as the second respondent, though served with Court notice remained absent and unrepresented on 05.11.05 and was placed ex parte. The MACT in the premise of the pleadings of the parties, framed the following three issues:

1. Whether petitioner proves that accident was solely due to rash and negligent driving of the driver of the offending vehicle and he sustained injuries as alleged?

2. Whether petitioner is entitled to get compensation? If so, to what amount and from whom?

3. To what order or relief the petitioner is entitled?

3. On 01.12.05 the claimant examined himself as PW-1, produced 14 documents marked as Exs. P1 to P14 and on 14.12.05 examined one Dr. C. Rajanna as PW-2. On 14.12.05, the appellant, filed an application to set aside the exparte order dated 05.11.05, which was allowed on the same day whence statement of objections was filed and the witnesses for the claimant cross-examined. For the respondents, the Insurance Company examined its Officer by name Vishwanathan as RW-1 and marked four documents as Exs. D1 to D4.

4. The MACT having considered the material on record, appreciated the evidence both oral and documentary, answered issue No. 1 in the affirmative, attributing actionable negligence to the rider of the Motor Cycle and awarded Rs. 1,15,000/- with interest at 6% p.a from the date of petition, as compensation, while fastening the liability on the appellant-Insurance Company to pay the compensation.

5. Learned Counsel for the appellant advances the following contentions:

a) That the policy of insurance being a ‘package policy’ without an endorsement for having paid additional premium to cover the risk of the pillion rider, the MACT was not justified in fastening the liability to pay compensation on the appellant.

b) That the alleged accident was fictitious since in the claim form (Ex. D2), the insured did not disclose that the claimant was a pillion rider when the accident occurred on 05.05.2005 and the medical records from J.S.S Hospital, where the claimant allegedly took treatment on 05.05.2005 were not produced nor the Doctor examined and that the wound certificate dated 21.07.2005 issued by the Chief Medical Officer Senior Specialist, K.R Hospital, Mysore, disclosed that the claimant was an inpatient from 16.06.2005, while the complaint Ex. P1 dated 12.06.2005 was lodged after a lapse of more than a month from the date of accident.

c) According to the learned Counsel, the MACT fell in error in not noticing the aforesaid indisputable facts leading to the only conclusion that the claimant and the insured took advantage of the alleged accident dated 05.05.2005 in order to make unlawful gain to themselves by having the liability to pay the compensation, fastened on the appellant.

d) Learned Counsel, in support of his contention places reliance upon the decision of the Apex Court in the United India Insurance Co. Ltd. v. Tilak Singh reported in 2006 ACJ 1441.

6. Learned Counsel for the first respondent-claimant seeks to support the judgment and award, impugned, as being well merited, fully justified and not calling for interference. The learned Counsel places reliance on a Larger Bench decision of the Supreme Court in Amrit Lal Sood v. Kaushalya Devi Thapar . 1998 ACJ 531..

7. In addition it is contended that the appeal is not maintainable for the following two reasons:

a) that the insured, in his statement of objections before the MACT admitted that the claimant was the pillion rider and suffered injuries in the accident that occurred on 05.05.05 involving the Motor Cycle and the finding attributing actionable negligence on the insured, owner cum rider of the Motor Cycle cannot be disputed by the appellant.

b) That the appellant-insurer did not apply for and seek leave of the MACT under Section 170 of the Act to contest the claim on all or any of the grounds that are available to the insured against whom the claim is made.

8. Having heard the learned Counsel for the parties examined the impugned judgment and award and perused the lower Court records, the following two questions arise for consideration:

1) Whether the appellant-Insurance Company is entitled to maintain this appeal calling in question the finding of the MACT on issue No. 1 attributing actionable negligence on the insured for riding the Motor Cycle in question, on 05.05.05, in a rash and negligent manner causing the accident and injuries to the claimant?

2) Whether the ‘package policy’ issued by the appellant-insurer in respect of the motor cycle in question, in favour of the insured, does not cover the risk of claim of the pillion rider as contended by the appellant?

9. Facts briefly stated are:— The claimant alleges to have sustained injuries in an accident that occurred on 05.05.05 while riding pillion, due to the rash and negligent riding of the Motor Cycle in question by the insured, and taken treatment at J.S.S Hospital, Mysore on 05.05.05 as disclosed in the complaint Ex. P1 and thereafter at K.R Hospital, Mysore, from 16.06.05 to 25.06.05, as an inpatient, certified in the wound certificate dated 21.07.05 and the discharge-cum-identity card Ex. P5. The claim is supported by the first information report, Ex. P2 furnishing particulars of the date of accident, names and addresses of the claimant and the insured, the spot mahazar, Ex. D4 dated 12.06.05 containing the signatures of both the claimant as well as the insured and the insurance policy, Ex. P3.

10. The appellant-insurer seeks to support its contention from the claim form, Ex. D2 said to be filed by the insured, leaving blank the column for information about the occupant/passenger/third party injury details, while recording as “one” against the column providing particulars of the number of people travelling at the time of accident. That claim of the insured for Rs. 1,083/- towards vehicle damage is said to be settled under Ex. D3-acknowledgement, in terms of the insurance policy known as “two wheeler package policy” Ex. D1.

11. The appellant, arraigned as respondent No. 2 before the MACT on being placed exparte, filed an application on 14.12.2005, whence the application was allowed. The MACT allowed another application for permission to cross-examine the claimant's witnesses. Though the appellant, in the statement of objections filed on 14.12.05, sought permission to contest the claim on all the grounds as are available to the insured, no permission was ordered under Section 170 of the Act.

12. The appellant-insurer examined one Vishwanathan as RW-1 who stated that the insured failed to comply with the terms of the policy and having suppressed material facts of the pillion rider having been involved in the accident, committed a breach of the terms of the policy by reason of which the appellant stood exonerated from paying the compensation.

13. It is apparent that the appellant-insurer did not obtain leave of the Court under Section 170 of the Act to contest the claim on any of the grounds available to the insured against whom the claim was made although such a request was made in the statement of objections. As a matter of fact, the insured contested the quantum of compensation, by filing his statement of objections admitting the accident and the injuries sustained by the claimant while denying the riding of the Motor Cycle in a rash and negligent manner. In these circumstances, it cannot be said that the appellant-insurer is entitled in law to maintain an appeal questioning the finding of the MACT attributing actionable negligence on the rider of the Motor Cycle, more so in the light of the limitations imposed by Section 149(2) of the Act. Reference may be made to the observations of the Apex Court in National Insurance Company Ltd. v. Nicolletta Rohtagi . 2002 7 SCC 456..

14. Even otherwise the fact of accident and injuries sustained by the claimant is not disputed by the insured, though neither the insured nor the injured-claimant lodged a complaint before the jurisdictional police on 05.05.05 J.S.S Hospital where the claimant is said to have been treated for the first time on 05.05.05 for the injuries sustained did not record the case, as medico-legal. So also, Krishnarajendra Hospital, Mysore, did not treat the case of injuries to the claimant as a medical legal case on 16.06.05 when the claimant was admitted in the Hospital since by then on 12.06.05, the claimant had lodged the complaint, Ex. P1. Merely on the basis of the claim form Ex. D2, claiming cost of repairs for vehicle damage, which did not provide the particulars of the claimant as a pillion rider, and the injuries sustained in the accident, cannot by itself and nothing more be said that the accident did not occur. In the facts and circumstances of this case, the non-registration of a criminal case on 05.05.05 over the alleged accident and injuries sustained by the claimant, in my opinion, no adverse inference could be drawn that the accident did not occur. The claimant having established by independent evidence the occurrence of the accident and having sustained injuries, as admitted by the insured owner cum rider of the Motor Cycle, it cannot but be said that the accident involving the Motor Cycle in question did occur on 05.05.05, in which the claimant sustained injuries. The MACT, in my considered opinion, was fully justified, in recording of finding of actionable negligence on the part of the owner cum rider of the Motor Cycle in question.

15. The policy of insurance Ex. D1 bears the nomenclature “Two Wheeler Package Policy”. The contract opens with the following sentence:

“Whereas the Insured by a proposal and declaration dated as stated in the Schedule which shall be the basis of this contract and is deemed to be incorporated herein has applied to Bajaj Allianz General Insurance Company Ltd. for insurance contained and has paid or agreed to pay the premium as consideration for such insurance in respect of accident loss or damage occurring during the period of Insurance.”

16. Under the heading “Section II-LIABILITY TO THIRD PARTIES”, the following conditions are mentioned:

1. Subject to the limits of liability as laid down in the Schedule thereto the company will indemnify the insured in the event of an accident caused by or arising out of the use of the insured vehicle against all sums which the insured shall become legally liable to pay in respect of

i) death of or bodily injury to any person including occupants carried in the insured vehicle (provided such occupants are not carried for hire or reward) but except so far as it is necessary to meet the requirements of Motor Vehicles Act, the Company shall not be liable where such death or injury arises out of and in the course of the employment of such person by the insured,

ii) damage to the property other than property belonging to the insured or held in trust or in the custody or control of the insured.

(Emphasis supplied)

17. The schedule of premium in the Certificate Cum Policy Schedule, Ex. P3 discloses that Rs. 1030.25 is paid towards own damage; Rs. 175/- as Basic Act, Rs. 50/- towards PA cover for owner-driver Rs. 1,00,000/- and that the total premium is Rs. 1,384/- inclusive of Rs. 129/- as service tax.

18. Under the heading limits of liability under Section II-1(i) of the policy, reads thus:

“Death or bodily injured: Such amount as is necessary to meet their requirements of the Motor Vehicles Act, 1”.

In the said policy Ex. P3, as against the word “endorsements” “227” is printed.

19. A reading of the aforesaid terms and conditions discloses that the Insurance Company issued a policy known as “Package Policy” for two wheelers and collected a premium to cover the risk of not only own damage, but also third party. The coverage also included the death or bodily injury to any person including occupants carried in the insured vehicle (provided such occupants are not carried for hire or reward). The terms and conditions of the policy and the schedule of payment cannot but be said to cover claims of the injured pillion rider of the Motor Cycle.

20. Although the learned Counsel for the appellant strenuously contends that covering the risk of injury or death of a pillion rider of the Motor Cycle is permissible only on payment of additional premium, such a contention in my opinion cannot be countenanced. I say so because, as noticed supra, the Insurance Policy is known as “Package Policy” and not an “Act Policy”. An “Act Policy” undoubtedly covers risks under the statute. The evidence of RW-1 is not in the direction of establishing that the policy of the insurance was an “Act Policy”. The “endorsement 227” in the schedule to the policy remains unexplained and the evidence of RW1 does not make reference to the said endorsement. RW-1 does not point out to any particular term in the ‘package policy’ Ex. D1 or the certificate cum policy schedule, Ex. P3 with regard to non-payment of an additional premium to cover the risk of pillion rider of the Motor Cycle or that the insurer was not liable to answer the claim of the pillion rider in the event of death or injury. In that view of the matter, it cannot therefore be said that the risk under the policy Ex. D1 was limited to claims of the owner or the rider of the Motor Cycle.

21. In my considered opinion, the MACT though did not consider the terms and conditions of the policy of insurance, nevertheless stumbled upon the correct decision by fastening the liability on the Insurance Company to pay the compensation. The second question is answered accordingly.

22. The decision in Tilak Singh's case relied upon by the learned Counsel for the appellant, in my considered opinion has no application to the facts and circumstances of this case. That was a case of a statutory insurance policy under the Act intended to cover the risk to life or damage to properties of third parties, without an endorsement of IMT 70, pertaining to accident to unnamed hirer/driver/pillion passenger, on payment of additional premium. The Apex Court held that the policy of the insurance being an “Act policy” relating to private vehicle, the pillion rider being a gratuitous passenger, without an endorsement of payment of additional premium, the insurer was not liable to pay the compensation.

23. In the result, this appeal is without merit and is accordingly, rejected. The Registry is directed to forthwith transmit Rs. 25,000/- in deposit to the MACT concerned.