RAMESH MADHAV BAPAT, J.

( 1 ) THIS is an appeal by District Co-operative Central bank Limited, Mahabubnagar, represented by its General Manager T. Suresh. The appellant herein was aggrieved by the award passed in O. P. No. 313 of 1989 by the motor Accidents Claims Tribunal-cum-Additional District Judge, Mahabubnagar making appellant liable to pay compensation to the respondent Nos. 1 and 2 herein. These two persons were claimants in the aforesaid O. P. The original petition was filed claiming compensation on the ground that a person named P. V. Narasimaha Rao, who was working as Assistant Regional officer in A. P. Co-operative Central Bank limited was travelling in a jeep bearing no. AHK 5180 on National Highway No. 7 from Atmakur-Mahabubnagar. The respondent no. 5 in the O. P. named Telugu ramulu drove the jeep. The jeep was hired by the respondent No. 3 from respondent no. 1 in the O. P. and it was insured with the insurance company. After hearing the parties, Tribunal awarded compensation of rs. 3,24,000 with interest at the rate of 12 per cent per annum making the District co-operative Central Bank Limited liable to pay compensation to the claimants.

( 2 ) MR. N. Vasudeva Reddy, the learned counsel appearing on behalf of the appellant herein did not dispute the quantum but submitted that the District Co-operative central Bank Limited is not liable to pay compensation because the vehicle in question was hired by them from the owner of the vehicle named M. V. Krishnaiah Goud, i. e. , the respondent No. 3 herein. The said vehicle was insured with the New India assurance Co. Ltd. The learned counsel further submitted that if the vehicle is hired and it met with an accident, then the person who hired the vehicle could not be made liable. In support of his contention, the learned counsel relied upon a ruling of this court in L. P. A. Nos. 87 to 90 of 1990, which was decided by the Division Bench of this court, held as under:"the question involved in these appeals is whether the A. P. S. R. T. C. is liable to pay the compensation. It is held in more than one decision by this court that where the A. P. S. R. T. C. takes vehicles on hire from the owner which is insured with the insurance company, the a. P. S. R. T. C. is not liable to pay the compensation. (Vide A. A. O. No. 1028 of 1984 dated 27. 10. 1988 ). However, the liability of the owner and the insurance company cannot be disputed. It is open to the claimants-respondents to proceed against the insurance company and the owner of the vehicle for realisation of the amounts. "considering the above ruling, this court holds that the appellant cannot be made liable to pay compensation to the claimants in O. P. No. 313 of 1989.

( 3 ) NOW the second question arises for our consideration as to who is liable to pay compensation?

( 4 ) IT is not in dispute that the vehicle owner by name M. V. Krishnaiah Goud was the respondent in the O. P. as well as in the appeal. The said vehicle was insured with the New India Assurance Co. Ltd. and, therefore, they are liable to pay compensation to the claimants. In support of his contention the learned counsel relied upon a ruling reported in New India Assurance co. Ltd. v. Kamla, 2001 ACJ 843 (SC), in which their Lordships of the Supreme court were pleased to hold that even there is a breach, the insurance company is liable to pay compensation. As it is found in this case that the owner had given the vehicle on hire to the District Co-operative bank Limited without paying any additional premium, the insurance company is not exonerated from paying the compensation. After paying compensation, the insurance company gets rights to recover the said amount from the owner as he has committed the breach.

( 5 ) SIMILAR view as expressed earlier by the Hon ble Supreme Court in a ruling reported in Amrit Lal Sood v. Kaushalya devi Thapar, 1998 ACJ 531 (SC ).

( 6 ) CONSIDERING the above legal position, we are of the considered view that the liability fastened

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