JUDGMENT
Neeladri Rao, J.
1. The point for consideration in all these appeals is whether the insurer is liable in regard to compensation to be awarded under Section 92-A, Motor Vehicles Act, 1939 (hereinafter referred to as (M.V. Act, 1939′) and if so, whether any defence is available to the insurer?
2. In all these cases the injured or the deceased travelled in lorries, i.e., goods vehicles by paying fare. Those lorries were involved in accidents and these passengers sustained injuries and some of them succumbed to the same. In regard to the latter the legal representatives-cum-dependants filed the applications under Section 110-A, Motor Vehicles Act, claiming compensation. The injured also filed similar applications. A Division Bench of this court (of which I am also a member) held in Oriental Fire and General Insurance Co. Ltd. v. M. Bhanumathi 1990 ACJ 1043 (AP), that such passengers are not covered by Act policy and hence the insurance company is not under an obligation to pay the compensation. Hence it has to be held that these injured persons or the legal representatives of the deceased passengers are not entitled to the compensation fixed under Section 110-B, M.V. Act, 1939.
3. But it was urged for the claimants as under:
No fault liability is provided in case of death or permanent disablement under Section 92-A, M.V. Act, 1939 and to that extent the insurer should be held liable. As Division Bench of this court (of which I am also a member) held in T. Srinivasulu Reddy v. C. Govardhana Naidu 1990 ACJ 66 (AP), that Section 92-A is applicable to pending proceedings even in respect of accidents which occurred prior to 1.10.1982, the date when the aforementioned provision had come into effect, the insurer has to be held liable even in cases where accidents had taken place prior to 1.10.1982.
4. Section 92-A (1), M.V. Act, 1939 postulates that the owner or the owners of the vehicles are liable and the insurer was not referred to in any of the provisions in Chapter VII-A, M.V. Act, 1939. As per Section 93(ba) which is in Chapter VIII, liability in relation to death or bodily injury to any person includes liability in respect thereof under Section 92-A Whether there is Act policy in regard to injured or deceased passenger in a goods vehicle, the same has to be considered in the light of Section 95(1)(b) of the Act. If such passengers are not covered by Act policy, the insurer cannot be held liable. The insurer can also contend that it may be absolved from the liability if any of the defences under Section 96 is open to it in the circumstances of the case. It was so urged for the insurer.
5. It was further urged for the insurer thus:
Though it can be stated that at the stage of enquiry under Section 92-A, the insurer cannot refer to any defences under Section 96 or cannot contend that there is no Act policy and thus the insurer can be directed to pay compensation for no fault liability still when it is ultimately held that there is no Act policy or that the insurer is entitled to any of the defences under Section 96, the owner should be directed to reimburse the insurer in regard to such amounts. As in these cases the petitions were filed only under Section 110-A, M.V. Act, 1939 and as enquiry in those petitions was over and when it was found that these passengers in the goods vehicles are not covered by Act policy, the insurer cannot be directed to pay the compensation to be awarded under Section 92-A, M.V. Act, 1939.
6. To appreciate the rival contentions, the relevant provisions in Motor Vehicles Act can be referred to and they are as under:
92-A Liability to pay compensation in certain cases on the principle of no fault.-
(1) Where the death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or disablement in accordance with the provisions of this section.
(2) The amount of compensation which shall be payable under Sub-section (1) in respect of the death of any person shall be a fixed sum of fifteen thousand rupees and the amount of compensation payable under that Sub-section in respect of the permanent disablement of any person shall be a fixed sum of seven thousand five hundred rupees.
(3) In any claim for compensation under Sub-section (1), the claimant shall not be required to plead and establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act, neglect or default of the owner or owners of the vehicle or vehicles concerned or of any other person.
(4) A claim for compensation under Sub-section (1) shall not be defeated by reason of any wrongful act, neglect or default of the person in respect of whose death or permanent disablement the claim has been made nor shall the quantum of compensation recoverable in respect of such death or permanent disablement be reduced on the basis of the share of such person in the responsibility for such death or permanent disablement.
92-B. Provisions as to other right to claim compensation for death or permanent disablement.-
(1) The right to claim compensation under Section 92-A in respect of death or permanent disablement of any person shall be in addition to any other right (hereafter in this section referred to as the right on the principle of fault) to claim compensation in respect thereof under any other provision of this Act or of any other law for the time being in force.
(2) A claim for compensation under Section 92-A in respect of death or permanent disablement of any person shall be disposed of as expeditiously as possible and where compensation is claimed in respect of such death or permanent disablement under Section 92-A and also in pursuance of any right on the principle of fault, the claim for compensation under Section 92-A shall be disposed of as aforesaid in the first place.
(3) Notwithstanding anything contained in Sub-section (1), where in respect of the death or permanent disablement of any person, the person liable to pay compensation under Section 92-A is also liable to pay compensation in accordance with the right on the principle of fault, the person so liable shall pay the first-mentioned compensation and-
(a) if the amount of the first-mentioned compensation is less than the amount of the second-mentioned compensation, he shall be liable to pay (in addition to the first-mentioned compensation) only so much of the second-mentioned compensation as is equal to the amount by which it exceeds the first-mentioned compensation;
(b) if the amount of the first-mentioned compensation is equal to or more than the amount of the second-mentioned compensation, he shall not be liable to pay the second-mentioned compensation.
92-C. XXX XXX XXX 92-D. XXX XXX XXX 92-E. Overriding effect.- The provisions of this Chapter shall have effect, notwithstanding anything contained in any other provision of this Act or of any other law for the time being in force. 93. Definitions.- In this Chapter- (a) 'authorised insurer' means an insurer in whose case the requirements of the Insurance Act, 1938 (IV of 1938), are complied with; (b)XXX XXX XXX (ba) 'liability' wherever used in relation to the death of or bodily injury to any person includes liability in respect thereof under Section 92-A; It is manifest from the aforementioned provisions that in order to claim no fault liability, the following factors have to be established: (1) Motor vehicle is used. (2) It was involved in an accident. (3) The accident resulted in the death or permanent disablement as contemplated under Section 92-C.
If the above factors are established the legal representatives of the deceased are entitled to Rs. 15,000/- and the injured who suffered permanent disablement is entitled to Rs. 7,500/-. No other fact need be proved for entitlement of the said compensation. It is evident from Section 92-A (4) that the said claim cannot be defeated even if the said accident was due to the wrongful act, neglect or default of the injured or the deceased.
7. It may be noted that in the Law of Torts, the driver of the vehicle, which is involved in an accident resulting in death or bodily injury, is liable to pay damages to the legal representatives of the deceased or the injured if the said accident was due to rash or negligent driving on his part. In such a case the owner of the vehicle is vicariously liable. But a reading of Section 92-A(1), (3) and (4) suggests that the owner of the vehicle is liable even if the accident is not due to the rash or negligent act of the driver and even in a case where the injured or the deceased was solely responsible for such accident. Thus it is a case of absolute liability on the part of the owner of the vehicle to pay damages in case of death or permanent disablement caused due to the accident, if that accident had arisen due to the use of his vehicle. Thus this liability which is termed as no fault liability is distinct and different from liability under Law of Torts which is termed as fault liability. The two liabilities are treated as separate liabilities as is evident from Section 92-B (1). It reads that the right to claim compensation under Section 92-A is in addition to the right on the principle of fault to claim compensation in respect of death or permanent disablement. Thus a fault has to be established to claim compensation under Section 110-A The fault on the part of the owner, a driver of the vehicle or any other person need not be established to claim compensation under Section 92-A Further, even the fault on the part of the victim, i.e., injured or the deceased is not a ground to defeat the claim under Section 92-A
8. But it was urged for the insurer that even the claim under Section 92-A is part of the claim under Section 110-A and thus it is neither distinct nor independent of the claim under Section 110-A To substantiate the said contention the following provisions are referred to.
9. Section 93 (ba) defines the liability under Chapter VIII as inclusive of liability under Section 92-A Under Section 92-B (3) (a) if the amount of compensation on the principle of fault liability is more than the compensation on the principle of no fault liability, the compensation which is equal to the amount by which the former exceeds the latter, has to be awarded under Section 110-A When the claims are made on the basis of both fault and no fault liabilities, the claim in respect of no fault liability has to be first disposed of as per Section 92-B (2). The legislature by incorporating the Chapter VII-A intends that some amount should be paid immediately to the injured in case of permanent disablement and to the legal representatives-cum-dependants in case of death and hence some limits are prescribed for such payments pending enquiry which generally takes long time for determining the quantum of compensation and the persons who are liable to pay the same. Hence it is urged that even if the insurer can be held liable for compensation under Section 92-A it should be permitted to raise all the defences and pleas open to it under Chapter VIII.
10. By virtue of Amendment Act 47 of 1988, Chapter VII-A was incorporated. Reference to the statement and reasons of that Amending Act shows that, inter alia, it was regarded as a measure of social justice. The legislature has taken note of the fact that the motor vehicle accidents were increasing and the victims of the accident are the pedestrians who do not belong to the affluent sections of the society. Even those who travel in lorries mainly belong to those sections. It was also realised that it was difficult to prove the rashness or negligence on the part of the driver especially in cases where the victims had become unconscious and subsequently succumbed to the injuries.
11. Of course, it is also one of the objects that succour should go to the needy at an early date. Be that as it may, the legislature by incorporating Section 92-A created a new type of liability in case of motor accidents. For this type of liability, particular monetary limit in case of death or permanent disability is prescribed. Such a liability was made even in a case where the accident was solely due to the negligence of the injured or the deceased. The legislature might have felt that such an accident would not have taken place if the motor vehicle is not used. The liability that was fixed under Section 92-A is indefeasible, peremptory and total. Thus it is an absolute liability. This type of liability on the part of the owner of the vehicle does not exist under Law of Torts. The claim for compensation under Section 110-A is only on the principle of fault liability which exists in Law of Torts. That is not an absolute liability. In case of Law of Torts if the accident had taken place solely due to the negligence of the injured or the deceased, neither the driver of the vehicle nor the owner of the vehicle is liable. Further, owner of the vehicle can avoid liability if he establishes that he had specifically instructed the driver not to take passengers in lorry, i.e., a goods vehicle. But in view of Section 92-A (4) even if the accident had taken place solely due to the negligence of injured or deceased, the owner of the vehicle is liable in regard to no fault liability, if his vehicle is involved in accident resulting in death or permanent disablement and no defence is open to him. Thus the nature of liability under Section 92-A is different from the nature of liability under Law of Torts which is the basis for claiming compensation under Section 110-A So the argument that the enquiry under Section 92-A is just like an enquiry in an interlocutory application pending enquiry of the main proceeding, i.e., Section 110-A in this case cannot be countenanced. Further when the language used in Section 92-B (1) is unambiguous and when it is specifically stated that the right to claim on the basis of no fault liability is in addition to claim under fault liability, the contention that the former is the part of the latter is not tenable. Of course as per Section 92-B (3) (a) if one claims both under no fault liability and fault liability and if the amount under fault liability is quantified over and above the compensation to be awarded under no fault liability, the difference alone has to be awarded under the head ‘fault liability’ in cases where the compensation under no fault liability was awarded. In the absence of Section 92-B (3), the injured or the legal representative of the deceased would have been entitled to compensation both under fault liability and no fault liability. Absolute liability is provided under Section 92-A One of the reasons for making such liability absolute is that the victim may not be in a position to establish the fault. The legislature felt that it is not proper to award compensation under no fault liability even in a case where the fault is established. It may be further seen that the right to claim compensation on the basis of fault liability, in addition to claim on the basis of no fault liability, is only optional. To illustrate one may be satisfied with the compensation that may be awarded under Section 92-A by way of no fault liability. Then he may not even contemplate to file a petition under Section 110-A to claim compensation on the basis of fault liability. Can it then be stated that the enquiry under Section 92-A is similar to enquiry in an interlocutory application pending the main proceeding. When the petition under Section 92-A alone is filed and when there is no application under Section 110-A, the enquiry has to be held under Section 92-A only. The only facts to be established in such enquiry are:
(1) A motor vehicle was used.
(2) It was involved in an accident.
(3) It resulted in death or permanent disability.
It does not contemplate any enquiry as to whether the injured or deceased was covered by the Act or contract policy and even if covered by Act policy, whether it comes within the defences available under Section 96. If the insurer also can be held liable for the compensation payable under Section 92-A, then under what provision the enquiry has to be held as to whether such injured or the deceased was covered by the Act policy or whether the circumstances indicate that it comes under one of the other defences available under Section 96? So when there is no scope to enquire in regard to the same, in cases where only a petition under Section 92-A was filed and when in such a case the insurer cannot come up with any pleas or defences available under Chapter VIII, can it be stated that the insurer could come up with such pleas or defences merely because the claimants filed a petition under Section 110-A also.
12. As the insurer Vas not referred to in Chapter VII-A and as the definition of liability’ as per Section 93(ba) is only in regard to Chapter VIII, the insurer cannot be held liable for the compensation under Section 92-A, was urged for the insurer. But this court in New India Assurance Co. Ltd. v. Chotinabee 1986 ACJ 120 (AP), held that the insurer is also liable in regard to the compensation to be awarded under Section 92-A In this context Section 92-E and Section 93(ba) were referred to. Section 92-A has an overriding effect over the other provisions of this Act and also of any other law for the time being in force. As already observed that as per Law of Torts, the owner is liable only for the negligent acts of his employee, in case of death or bodily injury caused due to the use of the vehicle. But as per Section 92-A, the owner of the vehicle is liable not only in a case where the driver of the vehicle is not even negligent for the accident, but also in a case where the injured or the deceased was solely responsible for such accident. Thus it is a new liability that was created under the Act. When thus the owner is absolutely liable, can it be stated that the cover of insurance does not include such a liability.
13. It may be noted that under Section 92-A, the liability is in case of death or permanent disability. But under Section 93(ba), the liability was defined in relation to the death or bodily injury of any person includes the liability in respect thereof under Section 92-A The bodily injury may result in permanent disability as contemplated under Section 92-C and it also includes other types of injuries. The liability under Section 92-A does not arise in regard to other bodily injuries. So in that context it has to be stated that for the purpose of Section 92-A, the bodily injury referred to in Section 93(ba) is only permanent disablement as defined under Section 92-C. At best it can be stated that it was not happily worded.
14. Further when an absolute liability was fastened and when the owner of the vehicle has to insure the vehicle compulsorily, can it be stated that the owner of the vehicle alone is liable for no fault liability, in cases where he need not take policy under Section 95(1)(b). As Section 92-E has got an overriding effect and when the intendment under Section 94 is to have insurance coverage in all cases where the owner is statutorily liable, it is just and proper to hold that the insurer is also liable in regard to the compensation payable under Section 92-A Hence I respectfully agree with the judgment of this court in New India Assurance Co. Ltd. v. Chotinabee 1986 ACJ 120 (AP), wherein it was held that the insurer is also liable to the compensation to be awarded under Section 92-A
15. But in Oriental Fire & General Insurance Co. Ltd. v. Beasa Devi 1985 ACJ 1 (P&H) and in Oriental Fire & General Insurance Co. Ltd. v. Shantabai S. Dhume 1987 ACJ 198 (Bombay), it was held that if for any reason the insurance company is not liable to pay the compensation under the terms of the insurance, it will be always open to it to get from the owner refund of the money paid under Section 92-A to the victim or to his family. But with due respect I disagree. The no fault liability is created for the first time under Section 92-A Such a liability does not exist as per the Law of Torts. As already observed this no fault liability is distinct and different from the fault liability available under the Law of Torts. The owner is made liable for no fault liability for the use of his vehicle. If that vehicle is not used, there could not be any accident because of that vehicle and there could not be any death or permanent disablement either to pedestrians and the question of passengers getting into that vehicle does not arise. As already observed, the owner of the vehicle is liable for no fault liability even in cases where the driver of the vehicle was not at fault and also in cases where the accident was solely due to the fault of the injured or the deceased. A reading of Section 92-A suggests that no defence is available to the owner of the vehicle if it is established that his vehicle was involved in the accident resulting in death or permanent disability as contemplated under Section 92-C. Thus even if a person enters into the lorry without heeding to the protests of the driver, the owner of the vehicle is liable if such person dies because of the injuries sustained in that accident or if they result in permanent disablement. Section 93(ba) reads that the liability in regard to Chapter VIII includes the liability under Section 92-A This court held in New India Assurance Co. Ltd. v. Chotinabee 1986 ACJ 120 (AP), that insurer is also liable for no fault liability.
16. Now it has to be seen whether the insurer is entitled to raise any pleas under Section 95(1)(b) or any defence under Section 96 to defeat the claim on the basis of no fault liability. Section 92-E is having overriding effect not only against other provisions in this Act but also against the general law. It follows that the other provisions in this Act are applicable in regard to no fault liability so long as they are not inconsistent with the provisions in Chapter VII-A The pleas under Section 95(1)(b) and the defences under Section 96 are applicable to an insurer if the claim is on the principle of fault liability. It means that if the claim is for damages as per Law of Torts. But when no defence is open to the owner even in case of contributory or sole negligence on the part of the victim or any act of the victim, it has to be held that it is a case of absolute liability and it cannot be defeated by way of any defence or other pleas. So the pleas or the defences available to an insurer as per Section 95(1)(b) or Section 96 are inconsistent with the concept of absolute liability created under Section 92-A- Hence in view of non-obstante clause as per Section 92-E which has overriding effect over the other provisions in the Act, it follows that the insurer is not entitled to raise the pleas available under Section 95(1)(b) or Section96. So if it is established that the vehicle which was involved in the accident was insured and that the policy was in force on the date of the accident, the insurance company is liable for no fault liability as Section 93(ba) defines that liability to include no fault liability under Section 92-A and as it means that Act policy covers no fault liability created under Section 92-A Hence I find that even if it is ultimately established that the insurer is not liable in regard to the amount awarded as per Section 110-B, still the insurance company is not entitled to recover the amount paid towards no fault liability. It follows that to the extent of no fault liability, the insurer is liable even in cases where it is not liable for the amount awarded under Section 110-B.C.M.A. Nos. 1017 and 1144 of 1982
17. The appellants in both these appeals are the claimants. They are the legal representatives of the respective deceased who succumbed to the injuries sustained in a motor accident while they were travelling in a lorry, a goods vehicle.
18. In view of the judgment of Division Bench of this court in Oriental Fire and General Insurance Co. Ltd. v. M. Bhanumathi 1990 ACJ 1043 (AP) and in view of my finding above, the insurer is liable only to the extent of Rs. 15,000/- with interest thereon from the date of the petition.
19. Thus these appeals are allowed to the extent indicated above; but no costs in the circumstances of the case.
C.M.A. Nos. 838, 839, 840, 841, 843 and 844 of 1985
20. These are the appeals preferred by the owner of the vehicle. It is contended for these appellants as under:
21. Lorry with 200 bags of cement was proceeding from Kesoram Cement Factory towards Peddapalli. On that day the buses were not plying due to strike. A police constable in uniform stopped the lorry and 24 to 25 persons climbed over the cement bags. When that lorry proceeded to a distance of 4 km., it turned turtle. As those persons entered the lorry by force, the owner is not liable.
22. But there is no evidence to substantiate the same. The driver and owner of the vehicle engaged the same advocate. The driver was examined. The owner was not examined. No fact in support of the plea of the owner of the vehicle was elicited from the driver. Thus there is no material to support the contention that the owner is not liable. Hence all these appeals are dismissed. No costs.
C.M.A. Nos. 871, 873, 874, 875, 876, 877, 878 and 879 of 1985
23. These appeals were filed by the insurance company in regard to the very accident for which the owner of the vehicle preferred the above-mentioned appeals. In view of, my findings the liability of the insurance company is limited to the extent the compensation can be awarded under Section 92-A with interest thereon from the dates of the original petitions.
24. The above C.M.As. are thus partly allowed. No costs.
C.M.A. Nos. 646, 1334, 1347, 1518, 1564, 1565, 1566, 1567 of 1985 and 291 of 1982
25. The insurers are the appellants herein. In view of my findings, these appeals are allowed in part and partly dismissed in regard to the following extent: The insurer is liable to the extent of the compensation provided under Section 92-A with interest thereon from the dates of the original petitions. No costs.
26. C.M.A No. 657 of 1984 is dismissed as total amount awarded is less than Rs. 15,000/-.