JUDGMENT
P. Ray, J.
1. The present appeal has been preferred by the Insurance Company against the judgment and award dated February 17, 2001, passed by the 2nd Motor Accident Claims Tribunal, Sambalpur in Misc. (A) 7 of 1992 (S).
2. The point urged by the Insurance Company is that the offending vehicle was insured as a private vehicle, but the same was being used for commercial purposes and carrying passengers for hire at the time of the accident. According to the Insurance Company, such use was in breach of the policy condition and accordingly, the Insurance Company cannot be held liable for paying compensation to the claimants. Supreme Court in New India Assurance Company, Shimla v. Kamla and Ors. (AIR 2001 SC 1419) has interpreted the Sectio’n 149 of the Motor Vehicles Act and summed up the effect of the said provision.
“22. To repeat, the effect of the above provisions is this; when a valid insurance policy has been issued in respect of a vehicle as evidenced by a certificate of insurance the burden is on the insurer to pay to third parties, whether or not there has been any breach or violation of the policy conditions. But the amount so paid by the insurer to third parties can be allowed to be recovered from the insured if as per the policy conditions the insurer had no liability to pay such sum to the insured.”
3. In view of the aforesaid decision of the Supreme Court, the Insurance Company remains liable to pay the determined compensation to the third party subject to its right to recover the said amount from the owner of the vehicle if any material condition of the policy has been infringed by the owner of the vehicle.
4. In the present case the Insurance Company has categorically raised the question that the vehicle was being used for commercial purpose in breach of the condition of the policy. The Tribunal has taken the view that the third party claimant should not suffer for an act of the owner in violation of the condition of the policy and the dispute regarding the violation of material condition of the policy is a dispute between the insurer and the insured, but unfortunately the Tribunal has not kept the said dispute open and it may not be possible for the Insurance Company to recover the amount from the owner of the vehicle, if the judgment of the Tribunal is allowed to stand as it is. The Tribunal committed error in not deciding whether there was any violation of the condition of the policy or by not keeping the said question open for further adjudication at the instance of the Insurance Company.
5. In view of the decision of the Supreme Court as referred to hereinbefore, the Tribunal has not committed any error in directing the Insurance Company to pay compensation to the third parties, but has committed error in not making it clear that such payment is subject to insurer’s right to recover the amount from the owner
of the vehicle, if it is proved that there was breach of conditions of the policy.
6. There is no dispute that the vehicle was covered by a valid Insurance policy. So far as the Insurer’s initial liability vis-a-vis the third parties is concerned, it is no longer res Integra. Accordingly, this Court is not inclined to admit this appeal on the said ground and to drag the unfortunate claimants unnecessarily to this Court. However,’Tribunal should consider whether there was breach of any material condition of the insurance policy and whether the insurer was thereby absolved of its liability to indemnify the insured,. But no useful purpose will be served by admitting the appeal and keeping it pending in this Court for the said limited purpose of determining the dispute between the insurer and the insured. The owner of the vehicle has not appeared nor filed any written statement In the Tribunal. Tribunal has also not considered the said contention of the insurer on merit. It is not possible for this Court to determine the said question of fact for the first time. This Court, therefore is of the view that interest of all the parties will be best served if the appeal is disposed of with necessary directions. The owner of the vehicle will not suffer any material prejudice inasmuch as he will get an opportunity of contesting the plea of the insurer regarding breach of condition of the insurance policy and Insurer’s right to claim reimbursement from the insured.
7. Accordingly, this Court disposes of this appeal with the following directions :
(i) Appellant-Insurance Company’s initial liability to pay the compensation as determined to the claimants is upheld but it is made clear that such payment is subject to further adjudication of the dispute regarding breach of condition of insurance policy.
(ii) The Appellant-Insurance Company is directed to deposit the awarded amount with interest in the Tribunal by June 15, 2002 for payment to the claimants.
(iii) The claim case is sent back on remand to the Tribunal for the limited purpose of determining the dispute between the insurer and the insured regarding breach of the conditions of the policy. But such determination will be made only after the Insurance Company deposits the entire awarded amount in the Tribunal as directed hereinabove.
(iv) The Tribunal will issue fresh notice to the owner of the vehicle for rehearing. It will allow the parties to lead evidence, if they so like and consider such evidence
In accordance with law. The claimants are not required to be heard for the aforesaid limited purpose.
(v) If Tribunal finds that there was breach of any material condition of the Insurance Policy, it will direct the insured (owner of the vehicle) to reimburse the amount paid by the Insurance Company to the claimants.
(vi) The cheques deposited by the Insurance Company be returned to the learned Advocate for the appellant-Insurance Company.