( 1 ) THIS reference has come up before us in terms of the reference order of a Division Bench dated 12-09-2006. The motor Accidents Claims Tribunal, Thodupuzha had directed award of compensation to the legal representatives of a deceased individual. It was on a finding that a private jeep, wherein he was a traveller, was driven in a negligent manner resulting in the accidental death. The jeep had been registered as a private vehicle, but the finding was that it was used for hire and there was violation of the policy conditions. The Tribunal held that the vehicle owner is liable to pay the amount of compensation, although the initial liability for payment was on the insurer. The insurance company normally would have been liable, however, but was entitled to be exonerated, according to the Tribunal, as there was violation of the policy conditions. It would have been therefore possible for them to proceed against the vehicle owner for reimbursement. The appeal has been filed by the vehicle owner principally contending that the finding about the violation of the policy conditions was without justification. It had been further contended that under Section 147 of the Motor Vehicles Act, the insurer was liable to indemnify him in view of the comprehensive policy taken by him.

( 2 ) THE accident had taken place on 09-01-1995. While the matter was being heard, the Division Bench expressed a doubt as regards the relevancy and impact of certain decisions, and the possible conflict, which might have been there, while adverting to and relying upon them. This is principally because, if the argument of the appellant was acceptable, the deceased could have been treated as a gratuitous passenger. With respect to the liability of the insurer, in such cases, according to the learned Judges, there might have been conflict between the view taken by a Full bench of this Court reported in Oriental Insurance Co. Ltd. v. Ajayakumar [1999 (2) KLT 886-FB] on the one hand and united India Insurance Co. Ltd. v. Tilak Singh [2006 (2)KLT 884-SC]. The later decision was one following the judgment of the Supreme Court in New India Assurance co. Ltd. v. Asha Rani and others [2003 (1) KLT 165-SC]. The reference order concluded as following:

"the Apex Court in the above decision just followed the decision in New India Assurance Co. Ltd. v. Asha Rani and others [2003 (1) KLT 165-SC] and stated that statutory policy will not cover the death or bodily injury suffered to gratuitous passengers. Learned counsel for the appellant referred to the decision of the Supreme Court in Asha Rani's case (supra) and submitted that Asha Rani's case (supra) related to coverage of passengers in a goods vehicle. However, it classifies the claims into three categories i. e. (1) cases covered under the provisions of the Motor Vehicles Act, 1939 (2) cases covered under the provisions of the M. V. Act, 1988 prior to the amendment in 1994 and (3) cases covered under the M. V. Act, 1988 after the amendment in 1994. It was pointed out that in Tilak Singh's case (supra) the accident occurred on 23. 3. 1989, i. e. before 1988 Act came into force on 1. 7. 1989 when the 1939 Act was in force and it will come under the first category and there is no dispute that in the first category cases passengers are not covered even as per earlier decisions of the Apex Court. However, there is no decision with regard to the second or third categories for liability of insurance company for passengers in a private vehicle after the introduction of new 1988 Act which came into force with effect from 1. 7. 1989 and after the amendment of the above Act in 1994. Since already there is a Full Bench decision of this Court and large number of cases are pending and insurance company is taking the stand that in view of the decision in Tilak Singh's case (supra) the Full Bench decision is no more good law, we are of the opinion that the matter should be reconsidered by the Full Bench. Hence, we adj