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1988 Supreme(AP) 537

Andhra Pradesh High Court
Judges : G.RADHA KRISHNA RAO
New India Assurance Co., Ltd., Nizamabad - Appellant
Versus
Suram Ramulamma - Respondent
A.A.O.Nos. 646, 921/87
Decided On : 12-15-88
Advocates Appeared :
Mr. K. Subba Rao,Mr. P. Prabhakar Reddy,K. Ramana Rao

Headnote:MOTOR VEHICLES ACT, Sec. 94 [2] - Insurance Policy excluding liability of Insurance Company in case of contravention of clause in the policy - Requisition of a private lorry by Government for election purpose - Accident involved causing death of certain persons -Insurance Company is not liable to pay compensation - Government is liable to pay compensation to claimants.

       Held : When a valid requisition is there for a vehicle and the user of the vehicle has been changed from the real owner to the State Government, in the event of an accident that taken, place by the requisitioned vehicle, the claim should be against the Government alone. When a specific condition is envisaged in the policy as contemplated under Section 94 (2) of the Motor Vehicles Act, it must be deemed that the liability also has been transferred during the period of requisition by the Government. Mere payment of batta to the driver to whom the vehicle is entrusted does not mean that the effect of requisition has been lost. Once the vehicle is given out by way of requisition, the effect of requisition divests the liability of the Insurance Company during the period of requisition. Merely because the owner is there and the vehicle is .insured and the third party that has been affected by it, no claim against the insurance Company can be made, ignoring the conditions that have been laid down in the requisition order, issued by the Government. The State Government alone is liable to pay the compensation amount, if any, during the period of requisition.

G. RADHAKRISHNA RAO, J.

( 1 ) LORRY bearing No. APT 5045 belongs to Mohd. Jahangir, 1st Respondent in the O. P. The 2nd respondent Mogili Narsimlu drove the vehicle on the date of the accident i. e. on 9-6-1981. The lorry was insured with the New India Assurance Co. Ex. B-1 is the policy. The lorry was placed by the owner at the disposal of the District Collector for the use in the Panchayat Samithi elections. The Government delegated to the respective district Collectors the powers vested in it under Sec:. . 63-B, 6s-D and 68-E of the A. P. Panchayat Samithis and Zilla Parishads Act, 1950, by a notification. The notification was issued with G. O. Ms. No. 328 Panchayat raj (Election IV) Department dated 17-5-1981, true copy of which is filed as ex. B-2. The Government in its G. O. Ms. No. 337, Punchayat Raj (Election IV) Department dated 20-5-1981, true copy of which is filed as ex. B-3, issued instructions for payment of hire charges for the motor vehicles requisitioned and batta charges to the drivers, conductors and cleaners of the vehicles. The Secretary to Government, Panchayat Raj, by letter dated 26-5-1981, true copy of which is filed as Ex. B-4, asked the transport authorities in the district to help the Collectors in requisitioning the required number of vehicles. The lorry in question was requisitioned by the Collector for election purposes under the delegated authority and the vehicle was allotted for transport of election personnel. One constable died and some others received injuries while they were on election duty, travelling in the vehicle. The learned Judge found that the claimants arc entitled for compensation. In the O. Ps the Government was not made a party. The Insurance Co. was made liable to pay the amount. It is against that, the insurance Co, filed the appeals.

( 2 ) THE contention of the Insurance Co, is that there is a requisition by the Government and it is in contravention of Clause (9) of Ex. B-1 which is as under :"the due observence and fulfilment of the terms, conditions and endorsements of this policy in so far, as they relate to anything to be done or complied with by the Insured and the truth of the statements and answers in the said proposal shall be conditions precedent to any liability of the company to make any payment under this policy". The Insurance Co. contended that it is not liable to pay any compensation and in support of its contention, it relied on National Insurance Co. Ltd. vs. Durdadakya K. Samal. In that case also, the vehicle was requisitioned by the Collector for election purposes and the vehicle was met with an accident due to the negligence of its driver and a person sustained injuries. The point that urose for consideration in that case was whether the Collector who had requisitioned the vehicle is vicariously liable. The answer is yes : as the driver remains under the control of the Collector and the Collector for the purpose of liability, becomes the owner of the vehicle. While construing the provisions of Sec. 95 of the Motor Vehicles Act in the case of requisition of vehicle, it has been found in the same judgment, that the insurance is a contracted guarantee to the owner of the vehicle to discharge his liability under the terms of the policy and it is not a universal guarantee for the vehicle whosoever becomes the owner and the liability during the period of requisition has been specifically excluded under the terms of the policy.

( 3 ) THE learned counsel for the respondents herein relied upon M. S. Ramachandra Pillai vs. V. K. R. Kumarappa Chettiar and Ors. In that case, the 3rd defendant who is the owner of the lorry lent the lorry and the driver to the 2nd defendant to one Subrahmanya Chettiar for marriage purpose and at the time of the accident, the 2nd defendant "continued to be the servant of the 3rd defendant and the person who hired the lorry had no control over the 2nd defendant. The 3rd defendant, the owner of the lorry, was also held liable for the damag








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