The main legal point established in the judgment is that under the Motor Vehicles Act, 1939, S.11(1)(a) of the Act provides indemnity to the insured in the event of an accident caused by the use of the motor car, but the insurance company shall not be liable where such death or injury arises out of and in the course of employment of such person by the insured. The Court's decision was influenced by the interpretation of this provision and its application to the insurance policy in question.

1. These appeals are against a judgment dated 30th January, 1991.

2. Briefly stated the facts are as follows:

Car bearing No. KLO 4828, driven by the 1st respondent (herein), met with an accident on 9th April, 1987. One of the passengers viz., one Anthony Alexander was seriously injured in that accident. The said Anthony Alexander thereafter succumbed to his injuries on 10th April, 1987. Respondents 1 to 6 are the legal representatives of the said Anthony Alexander. They filed a claim before the Motor Accidents Claims Tribunal (hereinafter referred to as the M.A.C.T.) against the appellant, the 1st respondent and the 8th respondent (insurance company).

3. Before M.A.C.T. the appellant claimed that he had sold the car, on 7th May, 1986, to one Smt. M.K. Bhavani, it was claimed that Smt. Bhavani had thereafter sold the car, on 12th May, 1986, to Sh. Aboobacker. It was claimed that on 15th August, 1986 Sh. Aboobacker had sold the car to one George Mathew. The said George Mathew had supposedly thereafter sold the car to one Roy Thomas on 18th August, 1986. The appellant claimed that on the date of the accident the car belonged to Roy Thomas. However, it was an admitted position that the transfer of ownership of the car was never intimated to the R.T.O. and that in the records of R.T.O. the name of the appellant continued to be shown as the owner.

4. An insurance policy bearing no 100505/22/1/0067/86 had been issued by the 8th respondent. It was valid from 25th November, 1986 to 24th November, 1987. This policy had been issued in the name of the appellant. Before M.A.C.T. the appellant claimed that he had not taken out the insurance policy.

5. The 1st respondent claimed, before the M.A.C.T., that the real owner was the appellant. The 1st respondent claimed that he was employed by the appellant. The 8th respondent claimed that the policy was only an Act policy (third party policy) and, therefore, it did not cover liability towards passengers.

6. Before M.A.C.T. the appellant examined himself. He also examined Smt. M.K. Bhavani, her son, Sh. Aboobacker and George Mathew to show that the car had been sold by him. The 1st respondent gave evidence to the effect that the appellant was still the owner of the car.

7. After considering the evidence M.A.C.T. gave an award dated 5th May, 1988. It held that the appellant was not the owner of the car and was, therefore, not liable. It held that the insurance company was also not liable as the policy had been got issued in the name of the appellant when he was not the real owner. It held that the driver was rash and negligent and responsible for the accident. M.A.C.T. passed an award in a sum of Rs. 1,40,700/- with interest at 12 per cent per annum. M.A.C.T. held that the driver was bound to pay the sum to the claimants.

8. The 1st respondent and respondents 1 to 6 filed appeals before the High Court. The High Court disposed of both the appeals by the impugned judgment dated 30th January, 1991. The High Court held that all the documents disclosed the appellant to be the owner of the car. The High Court held that the appellant was thus the owner of the car. The High Court held that as such owner the appellant was liable to pay compensation to the claimants. The High Court confirmed the finding that the driver had been rash and negligent and was the cause of the accident. The High Court held that the policy was an Act only (third party policy) and, therefore, the insurance company was not liable. The High Court, however, reduced the compensation to a sum of Rs. 1,32,000/- with interest at 12 per cent per annum from 7th July, 1987. Hence these civil appeals.

9. Mr. Iyer appearing for the appellant submitted that the High Court was wrong in ignoring the oral evidence on record. He submitted that the oral evidence clearly showed that the appellant was not the owner of the car on the date of the accident. Mr. Iyer submitted that merely because the name had not been changed in the records of the RTO