Manjula Chellur, Ag.C.J.

1. This appeal is by way of reference before us by order dated 24.08.2009. It reads as under:

"Respondents 1 and 2 filed claim petition under Section 163A of the Motor Vehicles Act. They claim to be the legal representatives of their son, who died in a motor accident.

2. The deceased was riding the motor cycle. The learned counsel for the appellant contends that the driver of the motor cycle was not covered by the policy. The learned counsel for the respondents 1 and 2 relied on the decision of the Division Bench of this court which is reported in New India Assurance Co. Ltd., V. Radhika (2009 (2) KLT 488). The same position has arisen for consideration in this appeal. The conditions of Policy providing for liability to third party were as follows, in the said decision:

"In terms of and subject to the limitations of the indemnify which is granted by this Section to the Insured the company will indemnify any Driver who is driving the Motor Cycle on the insured's order or with his permission provided that such Driver shall as though he were the insured observe, fulfill and be subject to the terms, exceptions and conditions of this Policy in so far as they can apply.

In the event of death of any person entitled to indemnify under this Policy the company will in respect of the liability incurred by such person indemnity his personal representatives in the terms of and subject to the limitations of this Policy provided that such personal representatives shall as though there were the insured observe, fulfill and be subject to the terms, exceptions and conditions of this Policy in so far as they can apply."

3. The Division Bench has taken the view that the driver is covered. We are unable to subscribe to the dictum. The liability which appears to be undertaken by Clause 3 and 4 would appear to be the liability under a contract of indemnity. The company has undertaken to indemnity the driver and Clause also provides for the indemnification of the personal representative of such person, who is entitled to indemnity in the event of his default. It is very clear from Clause 4 that the company undertakes to indemnify in respect of the liability incurred by such person. His personal representative would be the beneficiary of such indemnification. The liability is clearly undertaken only to the third parties in our view.

In view of our disagreement, place this matter before the Honorable Chief Justice, for passing appropriate orders for reference to a Larger Bench."

2. It is necessary to refer to the facts of the present case to understand the real question of controversy raised in the matter. The claimants before the Tribunal are the parents of one Mr. Shine aged about 21 years, who met with an accident on 22.08.2000 at Bangalore, while riding a motor cycle belonging to the insured, third respondent. He succumbed to injuries on 30.09.2000. The claimants, parents of the deceased Shine, approached the Tribunal claiming compensation for the death of their son in a motor accident. The respondents were; the owner of the vehicle -the insured and the present appellant - the insurer of the motorcycle in question. The defence raised by the appellant/insurer before the Tribunal was, the rider was negligent and the injury leading to his death was not covered under the policy, therefore, they are not liable to pay compensation. The Tribunal, though held that the accident was due to the negligent riding of the vehicle by the deceased Shine, but assessed compensation, ultimately directing the appellant insurance company to pay the amount and recover from the owner of the vehicle, the insured. Aggrieved by the same, the appellant/insurance company approached this Court. As stated above, the Division Bench referred the matter to a larger Bench.

3. The deceased was not the paid employee of the insured. As a matter of fact, two vehicles involved in the accident i.e the motor cycle manned by the deceased Shine and als