ORDER
A.K. Patnaik, C.J.
1. This is a reference made by a Division Bench of this Court in this M.A. for reconsideration of the decision rendered by another Division Bench in Oriental Insurance Co. v. Jamna Bai and Ors. 2001 (4) M.P.H.T. 293.
The facts of the case in the miscellaneous appeal which necessitated the reference are that on 3-5-1997, when Bhanwar Lal Lokhande was travelling in a truck bearing registration No. CIB-3490, the truck turned turtle and in the accident Bhanwar Lai Lokhande sustained injuries and eventually died. The legal heirs of the deceased Bhanwar Lai Lokhande instituted Claim Case No. 14/97 before the Motor Accident Claims Tribunal, Betul claiming an amount of Rs. 7,77,500/- as compensation against the New India Assurance Company Ltd., which had insured the truck. The truck was owned by Bhanwar Lal Lokhande and his brother Umesh Kumar Lokhande and therefore the Insurance Company contended before the Tribunal that the Insurance Company was not liable to indemnify the owners of the truck or their legal heirs and that the Insurance Company was only liable under the policy read with Section 147 of the Motor Vehicles Act, 1988 (hereinafter referred to as “the Act”) to pay compensation to the third party. The Tribunal upheld the contention of the Insurance Company and dismissed the claim petition.
2. Aggrieved, the legal heirs of Bhanwar Lal Lokhande, filed M.A. No. 2461/99 before this Court. Before the Division Bench hearing the M.A, the appellants relied upon the decision of a Division Bench of this Court in the case of Oriental Insurance Co. Ltd. v. Jamna Bai and Ors. (supra). In Jamna Bai’s case, the facts were that the deceased was the owner of tractor along with Apa. The deceased, however, was not travelling in the tractor insured with the Insurance Compay. The tractor was being driven by a driver appointed by Apa and when the tractor was being taken towards the land, the deceased was injured. On these facts, the Division Bench held that the deceased fell within the definition of “third party”. The Division Bench further found that under the policy of Insurance of that case, besides normal premium, the deceased had paid Rs. 150/- against “Own damages”. The Division Bench held that the Insurance Company was liable to pay compensation on the death of deceased Umrao Singh, a
3. Before the Division Bench of the present M.A., the Counsel for the Insurance Company cited inter alia the decision of the Supreme Court in Dhanraj v. New India Assurance Co. Ltd. and Anr. , and contended that the law laid down by the Division Bench in the case of Jamna Bai (supra), requires reconsideration in view of the decision of the Supreme Court in Dhanraj v. New India Assurance Co. Limited and Anr. (supra). The Division Bench passed an order dated 8-11-2004 taking a prima facie view that the decision of the Division Bench rendered in the case of Jamna Bai (supra), requires reconsideration by the Full Bench and framed following questions to be answered by the Full Bench:
(a) Whether the owner can claim compensation in respect of an injury sustained by him in a motor accident, unless a premium in respect of personal injury has been taken by way of special insurance contract?
(b) Can the legal heirs of the deceased owner put forth the claim for compensation in the absence of special policy?
(c) Can the owner under any circumstances be treated or deemed to be treated as a third party?
(d) Whether own damage would cover the damage to the person of the owner or it is confined to the properties of the vehicle owner?
4. We have heard Mr. Subodh Kathar, learned Counsel for the appellants and Mr. Anoop Nair, learned Counsel for the respondent No. 1. None has appeared for the other respondents. We have also heard Mr. S.K. Rao and Mr. Sanjay Agrawal, who assisted the Court us Amicus Curiae.
5. Under question (a) referred by the Division Bench, we are required to answer whether the owner can claim compensation in respect of an injury sustained by him in the motor accident, unless a premium in respect of personal injury has been taken byway of special insurance contract? In Dhanraj v. New India Assurance Co. Ltd. and Anr. (supra), the Supreme Court held:
Thus, an insurance policy covers the liability incurred by the insured in respect of death of or bodily injury to any person (including an 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. Section 147 does not require an Insurance Company to assume risk for death or bodily injury to the owner of the vehicle.
It is thus clear that in Dhanraj v. New India Assurance Co. Ltd. and Anr. (supra), the Supreme Court clearly held that Section 147 of the Act does not require the Insurance Company to assume risk for death or bodily injury to the owner of the vehicle and therefore the Insurance Company under the Insurance Policy which covers only liability under Section 147 of the Act would not be liable for death or bodily injury to the owner of the vehicle.
6. Again, in Oriental Insurance Co. Ltd. v. Jhuma Saha and Ors. , the Supreme Court after referring to the law as laid down in Dhanraj v. New India Assurance Co. Ltd. and Anr. (supra), held:
The additional premium was not paid in respect of the entire risk of death or bodily injury of the owner of the vehicle. If that be so, Section 147(1)(b) of the Motor Vehicles Act, which in no uncertain terms covers a risk of a third party only would be attracted in the present case.
7. It is clear from the aforesaid two decisions of the Supreme Court in Dhanraj v. New India Assurance Co. Ltd. and Anr. (supra), and Oriental Insurance Co. Ltd. v. Jhuma Saha and Ors. (supra), that the owner cannot claim compensation in respect of injury or death suffered by him in a motor accident, unless additional premium in respect of such personal injury or death has been taken by way of special insurance contract. Question No. (a) referred by the Division Bench in the present case is answered accordingly.
8. Question No. (b) referred by the Division Bench, is whether legal heirs of the deceased-owner can put forth a claim for compensation in the absence of special policy. As a logical corollary of our answer to question No. (a) above, we hold that the legal heirs of deceased-owner cannot put a claim for compensation for death or injury o[ deceased in a motor accident unless additional premium in respect of personal injury has been taken by the Insurance Company byway of special insurance contract from the owner of the vehicle.
9. The question referred under Clause (c) by the Division Bench is whether the owner in any circumstance can be treated or deemed to be treated as a “third party”. The expression “third party” was interpreted by the Full Bench of this Court in Jugal Kishore and Anr. v. Ramlesh Devi and Ors. 2003(4) M.P.H.T. 574 (FB) : 2003 (4) MPLJ 546, to mean parties other than the contracting parties to the insurance policy. Paragraph 17 of the judgment of the Full Bench in Jugal Kishore (supra), is quoted hereunder:
Section 145(g) of the Act defines “third party”. It defines that the “third party” includes the Government. It would mean that other than the contracting parties to the insurance policy, the expression “third party” should include everyone, be it a person travelling in another vehicle, one walking on the road or a passenger in the vehicle itself which is the subject-matter of the insurance policy. Every insured takes out an insurance policy against a third party risk and enters into a contract with insurer only with the motive, intention and purpose of covering the risks which may arise in relation to claims lodged against him by a third party. Insurer agreeing to issue insurance policy thereby undertakes to insure the insured and indemnify him against all risks in relation to all claims lodged against him by third party. It will not be proper to narrow the scope and ambit of the word “third party” and exclude the passengers from the operation and purview which would not only defeat the very purpose of taking out the insurance policy, but the very object of the Motor Vehicles Act which makes it mandatory requirement of law that all vehicles/owners of the vehicles must be compulsorily insured against third party risk.
It will be clear from the aforesaid judgment of the Full Bench that the insured who is a party to the policy of insurance is not a “third party” for the purposes of Chapter XI of the Act and in particular Section 147 thereof.
10. The next question is whether the person who is insured and the owner of the vehicle can be two different persons. If they can be two different persons, then there may be a case, where the owner of a vehicle, who is not the insured person, would be a “third party” for the purposes of Chapter XI of the Act. But Section 157 of the Act contemplates that the certificate of insurance will be issued in favour of the owner of the vehicle. Section 157 of the Act is quoted hereinbelow:
157. Transfer of certificate of insurance.-(1) Where a person in whose favour the certificate of insurance has been issued in accordance with the provisions of this chapter transfers to another person the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer.
Explanation: For the removal of doubts, it is hereby declared that such deemed transfer shall include transfer of rights and liabilities of the said certificate of insurance and policy of insurance.
(2) The transferee shall apply within fourteen days from the date of transfer in the prescribed form to the insurer for making necessary changes in regard to the fact of transfer in the certificate of insurance and the policy described in the certificate in his favour and the insurer shall make the necessary changes in the certificate and the policy of insurance in regard to the transfer of insurance.
It will be further clear from a plain reading of Section 157 of the Act quoted above that whenever a person in whose favour the certificate of insurance has been issued traders to any other person, the ownership of the motor vehicle in respect of which such insurance was taken together with the policy of insurance relating thereto, the certificate of insurance and the policy described in the insurance certificate shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer, This provision goes to show that the owner of the vehicle and the insured under an insurance policy is one and the same person. Accordingly, the owner of the vehicle cannot be a “third party” for the purposes of Chapter XI of the Act. Question number (c) referred by the Division Bench is answered accordingly.
11. This is not to say that the owner of the vehicle would not be entitled to any loss suffered in an accident from the insurer. All that we have held is that a policy only satisfying the requirements of Section 147 of the Act does not cover such loss suffered by the owner of the vehicle. But Sub-section (5) of Section 147 of the Act makes it clear that a policy of insurance may contain terms and conditions under which the owner can claim loss suffered by him in the accident from the insurer notwithstanding anything contained in any law for the time being.
12. This leads us to question number (d) referred by the Division Bench:
Whether own damage would cover the damage to the person of the owner or it is confined to the properties of the vehicle owner.
In Dhanraj v. New India Assurance Co. Ltd. and Anr. (supra), the Supreme Court considered a policy which covered “own damage” and held that under the policy of insurance in that case under the heading “own damage” words “premium on vehicle and non-electrical accessories” appear and on the terms and conditions of the said policy held that the premium that was paid was towards damage to vehicle and not for injury to the person of the owner. Thus, the expression “own damage” will have to be read along with the express terms and conditions of the insurance policy and if on a reading of the terms and conditions of the insurance policy, it is found that the premium that is paid for “own damage” covers only damage to the property of the insured and not to injury to the person of the owner or life of the owner, then obviously the insurer would not be liable for compensation for injury or death of the owner, but if on a reading of the terms and conditions of the insurance policy it is found that additional premium has been paid not only for damage to property but also for injury or death of the owner then the insurance company will also be liable for compensation for injury or death of the owner in addition to loss of property. Accordingly, we answer question No. (d), referred to us by the Division Bench of saying that it will ultimately depend upon the terms and conditions of the insurance policy and the premium or additional premium paid and the purpose for which premium or additional premium has been paid for coming to the conclusion whether “own damage” would cover damage to the person of the owner or will be confined to the properties of the vehicle owner.
13. Before we part with this case, we would like to record our appreciation for the assistance rendered by Mr. S.K. Rao, Senior Advocate and Mr. Sanjay Agrawal, Advocate, Amicus Curiae, Mr. Ashok Lalwani, Advocate who appeared for the appellant in M.A. No. 246/04, Mr. Anoop Nair, Advocate for the respondent and Mr. Subodh Kathar, Advocate for the appellant in writing this judgment on very intricate questions of law.
This M.A. will now be placed before the appropriate Bench for hearing on merits.