JUDGMENT :

R.F. Nariman. J. - Leave granted.

2. In the present case, death occurred to a 45 year old who was on a cycle and hit by a bus on 16.08.2001. The Motor Accident Claims Tribunal (hereinafter referred to as 'MACT') found that it was as a result of rash and negligent driving by the driver of the bus, which was hired by the appellant-Uttar Pradesh State Road Transport Corporation under an agreement between it and the bus owner. Ultimately finding that the income would be Rs.18,000/- per year, minus one-third, and with a multiplier of 13, Rs.1.65 lakhs + 8 per cent interest was awarded by the MACT, but it was held, following Rajasthan State Road Transport Corporation vs. Kailash Nath Kothari (1997) 7 SCC 481 ["Kailash Nath Kothari"], that it is only for the appellant-Corporation to pay this entire amount and not the insurance company. This was held as follows:

"15. The bus is a private one. It ran under the control of the UPSRTC. The ld. counsel for the Insurance Company has argued that the bus under the control of UPSRTC devolved the responsibility of payment of any compensation upon UPSRTC because it is not the owner who is in control of the bus but the Corporation who controls the working of the driver. The ld. counsel for the company cites Rajasthan State Road Transport Corporation versus Kailash Nath Kothari 1997 ACT 1148. I find the case law referred to applies squarely to the present case at hand. The UPSRTC O.P. No. 3, and not the O.P. No. 1 and 2, is responsible to pay the award."

3. In the High Court, by a judgment dated 27.09.2016, the same judgment of Kailash Nath Kothari (supra) was referred to and followed, making it clear, therefore, that the appellant alone is vicariously liable to pay the victim's family the amount of compensation that has been ordered. It was therefore also stated, referring to the agreement between the Corporation and the owner of the vehicle, as follows:

"Much emphasis has been laid by learned counsel for the appellant on Clause 10 of the agreement between the appellant and the owner to wriggle out of its responsibility to make payment of compensation. There is no reference of the said agreement in the impugned award. No such ground has been taken in the memo of appeal that it was filed before the Tribunal but has not been considered. In any view of the matter, even if such a clause exists in the agreement, it is between the appellant and the owner and shall not affect the rights of the claimants to receive compensation flowing from the provisions of the Act. Thus, the first argument advanced by learned counsel for the appellant is devoid of any force and not liable to be accepted."

4. Having heard learned counsel appearing for all the parties, we are of the view that the judgment relied upon, viz., Kailash Nath Kothari (supra), is itself distinguishable for the reason that the judgment itself records as follows:

"3. . . . The insurance company took the plea, in its reply to the claim petitions, that the bus at the time of the accident was under the control of the RSRTC, therefore, it was the liability of the RSRTC to pay compensation and the insurance company was not liable. It was further pleaded by the insurance company that the liability of the insurance company, in any event, was limited and its liability could not exceed Rs. 75000/- in respect of all the claim petitions arising out of one accident. .. .

4. ... Issue No. 2 was also decided in favour of the claim petitioners but it was held that in the light of the terms of the policy of insurance and relevant provisions of the Act, the liability of the insurance company was limited, in respect of the accident, to a total amount of Rs.75,000/-only."

xxx xxx xxx"

7. . . . Learned counsel appearing for the insurance company, did not question the finding on Issue No. 2 and submitted that the specified amount had since been paid by the insurance company. . . ."

In addition to this, the Court also held, relying upon the definition of "owner" in Se