The purpose of the vehicle as defined by the permit and any violation of permit conditions are crucial in determining the liability of the insurer under S.96 of the Motor Vehicles Act.

1. The second appeal is the consequence of a tragic bus accident in the High ranges of Kerala which resulted in the loss of 7 lives and injuries to many others. we are immediately concerned with the death of a father and son, Kuruvilla Joseph and Joseph Varkey, whose representatives have brought the present action for compensation under the Fatal Accidents Act. Both the lower courts have held that the driver was negligent and that the fatal consequence was directly caused by such negligent driving. A decree for Rs. 2700/-referrable to the death of the father and for Rs. 2000 of the son was granted to the plaintiffs. The sums were obviously small. But the poor plaintiffs did not carry the matter in appeal. It is unfortunate that the trial court has awarded only such a small amount by way of damages. But I am not concerned to go into this aspect of the matter as the plaintiffs have acquiesced in the decree. The first defendant also did not bother to file an appeal, for the additional reason that he had to pay only Rs. 700 out of his pocket since the second defendant, the State Insurance Department, was directed to pay Rs. 2000 for each life lost. However, the second defendant challenged the decree making it liable and urged before the appellate court that the first defendant alone was liable in view of the provisions of S.96 of the Motor Vehicles Act. The plea of the second defendant was that there was overloading by the first defendant at the time of the accident, and since one of the conditions of the permit issued to the stage carriage in question had thus been violated the insurer was not liable in damages and that the first defendant alone had to pay the sum decreed. Two questions were considered by the courts below, one of fact and the other of law. The learned Subordinate Judge took the view that there was no overloading at the time of the accident, while the learned District Judge disagreed with this finding. I have no doubt, after having read the discussions of the two courts and also on a reasonable understanding of the evidence adduced in the case, that the trial court's decision that there was no overloading is perverse. Apart from the fact that outrageous overloading under the nose of the police has become the order of the day in the Kerala State, the positive evidence adduced in this case leads to no conclusion but that there was no space for a number of passengers to sit because all the seating accommodation had already been filled. The learned Subordinate judge, expanding upon minor discrepancies and relying upon a first information statement which had not been proved by its author (and was therefore inadmissible in evidence) has reached a strange conclusion. The learned District Judge has set the record right, if I may say so, by holding that the bus was clearly overloaded.

2. Based on this finding the argument was put forward by the insurer that under S.96 (2) (b) (i) (c) there was no liability for the State Insurance Department. More particularly, the point made was that there had been a breach of a condition of the Policy in that the vehicle had been used for a purpose not allowed by the permit. The permit issued to the vehicle in question was one for a stage carriage as defined in S.2(29). A stage carriage means "a motor vehicle carrying or adapted to carry more than 6 persons for hire or reward"

There is no dispute that the bus in question was a stage carriage, and that a permit had been issued as defined under S.2 (20) of the Act, for this bus. The only question is whether the bus had.been used for a purpose not allowed by the permit under which the vehicle is used. lam afraid, the argument is fallacious and confuses between the purpose for which the vehicle is used and the conditions subject to which such purpose is effectuated. The purpose of the stage carriage was to carry passengers and, in this case, it is obvious that the bus was carrying passengers. If it had been used not for carrying hum