IMPORTANT POINT
Insurance Company cannot be held liable for paying compensation if the vehicle is driven in contravention of the terms of the insurance policy.

ORDER :

1. Leave granted. National Insurance Company Ltd. (in short “the Insurance Company”) is before us against the judgment and order passed by the High Court of Himachal Pradesh at Shimla in four first appeals, two preferred by the Insurance Company and two preferred by the claimants, which were heard together and disposed of by the common impugned order dated 28-7-2005 National Insurance Co. Ltd. v. Savitri Devi, FAO No. 143 of 2000, decided on 28-7-2005 (HP). According to the appellant Insurance Company, no liability could have been fastened on it as admittedly, on the date of the accident on 12-11-1996, a barat was being carried in a Tata mini open truck, bearing Registration Number HPK 9276. It is unfortunate that in the said accident, four persons including the owner-cum-driver of the mini truck had lost their lives.

2. Since four persons had died, obviously, four claim petitions came to be filed before the Motor Accidents Claims Tribunal II, Kangra at Dharamshala (in short “the Claims Tribunal”). On the strength of the pleadings of the parties, the Claims Tribunal framed Issue 4, which is relevant for deciding the aforesaid appeals as mentioned hereinbelow:

“Whether the vehicle involved in accident was being driven in contravention of the terms and conditions of the insurance policy at the relevant time, if so, its effect?”

3. The appellant Insurance Company submitted Policy No. 31/21/95/948 before the Claims Tribunal, marked as Ext. R-1, but did not lead any oral evidence with respect to this issue. However, it was not disputed that the said policy pertained to the aforesaid Tata mini open truck and was in force at the relevant point of time. For our perusal, a copy thereof has been submitted before us once again. We have gone through it critically. It was insured as goods carrying vehicle only. The terms and conditions of the policy categorically say that the policy would not cover the following contingencies:

(i) Use for organised racing pace making reliability trial or speed testing;

(ii) Use whilst drawing a trailer except the towing (other than for reward) of any one disabled mechanically propelled vehicles.

(iii) Use for carrying passengers in the vehicle except employees (other than the driver) not exceeding six (6) in number coming under the purview of the Workmen's Compensation Act, 1923.

4. The Claims Tribunal was largely impressed by the fact that even though it was insured only as a goods carrying vehicle, but was being used regularly for carrying members of marriage parties on the occasion of marriages. Thus, on the strength of the evidence of PW 3 and PW 4, the Claims Tribunal, in its wisdom, deemed it fit that even if such an act violated the clear terms and conditions of the policy, but since the truck was being used to carry passengers on a regular basis for such a long period, therefore, the appellant Insurance Company could be held liable to pay the amount of compensation. To make the things clear, we deem it fit and proper to reproduce para 13, dealing with Issue 4 by the Tribunal:

“Issue 4

The onus of this issue too was on the Insurance Company, Respondent 4. Respondent 4 has not led any evidence, worth the name, except tendering policy, Ext. R-1. Indeed, the Insurance Company has not proved the relevant and specific exclusion clause of the insurance policy under which it seeks exoneration from the liability. It is no doubt true that as per policy, Ext. R-1, the vehicle in question was a tempo, but it has come in the evidence of PW 3 and PW 4 that the said tempo, apart from carrying the goods, used to be regularly used for carrying members of the marriage parties in the marriages, and as such it used to be hired frequently for that purpose, which means that the tempo in question was used for carrying passengers for hire or reward and in such a situation, the deceased cannot be treated as gratuitous passenger, especially when as seen above, Respondent 4 has led no evidence.”

5. In the light of this