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HIGH COURT OF HIMACHAL PRADESH
C. B. CAPOOR, J.
Union of India
Versus
Shri Labh Chand Sharma
Civil Misc. First Appeal No. 42 of 1962
Decided On : 29-06-1962
MOTOR VEHICLES ACT - SECTIONS 94, 95, 110 - LIABILITY OF STATE TRANSPORT UNDERTAKING EXEMPTED FROM INSURANCE REQUIREMENT - JURISDICTION OF MOTOR ACCIDENT CLAIMS TRIBUNAL.
Fact of the Case:
A bus owned by the Himachal Pradesh Transport Department met with an accident resulting in the death of a passenger. The Motor Accidents Claims Tribunal awarded compensation of Rs. 6,000 to the deceased's family. The State appealed, arguing that the Tribunal lacked jurisdiction to award compensation in excess of Rs. 2,000, the limit for third-party liability insurance under the Motor Vehicles Act.
Finding of the Court:
The Court held that the State Transport Department was not an insurer and its liability was not limited to the amount specified in section 95 of the Motor Vehicles Act. The Court also held that the Motor Accidents Claims Tribunal had jurisdiction to adjudicate upon claims for compensation arising out of accidents involving the use of motor vehicles, regardless of whether the vehicles were insured.
Issues: 1. Whether the State Transport Department was an insurer and its liability was limited to the amount specified in section 95 of the Motor Vehicles Act. 2. Whether the Motor Accidents Claims Tribunal had jurisdiction to adjudicate upon claims for compensation arising out of accidents involving the use of motor vehicles, regardless of whether the vehicles were insured.
Ratio Decidendi: 1. The Court interpreted section 94(3) of the Motor Vehicles Act, which exempts State Transport Undertakings from the requirement of insurance against third-party risks, and held that this exemption did not make the Transport Department an insurer. 2. The Court interpreted section 110(1) of the Motor Vehicles Act, which establishes Motor Accident Claims Tribunals, and held that the jurisdiction of these Tribunals is not limited to claims against insurers, but extends to all claims for compensation arising out of accidents involving the use of motor vehicles.
Final Decision: The Court dismissed the appeal and upheld the award of compensation by the Motor Accidents Claims Tribunal.
2. Gusaon Ram, the husband of respondent No. 3 and the father of respondents Nos. 1 and 2, boarded the Himachal Pradesh Government Transport bus No. Him-971 at Simla on 27-1-1961. The bus was bound for Bilaspur and the aforesaid Gusaon Ram was to travel up to Khunera. When the aforesaid bus reached near Shalaghat on the Simla-Mandi road at about 4.30 P.M. it met with an accident and the aforesaid Gusaon Ram sustained serious injuries in his chest and on his head and breathed his last while he was being taken to the hospital at Arki. The respondents submitted an application claiming a sum of Rs. 10,000/- as damages on account of the loss sustained by them as a result of the death of the aforesaid Gusaon Ram. The deceased was employed as a head-bearer by the Grand Hotel Simla and also carried on cultivation in his village and it was alleged that his monthly income was Rs. 150/-. At the date of the accident he was about 50 years old.
3. The application was resisted by the appellants on the grounds that the respondents were not the legal representatives of Gusaon Ram and that in any view of the case the amount of compensation claimed was excessive and could not exceed Rs. 2,000/-.
4. The Tribunal reached the conclusion that the respondents were the legal representatives of the deceased Gusaon Ram, and that finding has not been challenged in this appeal. It further held that Gusaon Ram might well be expected to have lived for another 10 years if the accident had not happened and that as a result of his death the family has suffered a loss of Rs. 50/- p.m. It rejected the contention advanced on behalf of the appellants that it was not within his powers to award compensation in excess of Rs. 2,000/-. The first reason assigned by it for arriving at the aforesaid conclusion was that in Himachal Pradesh transport has been nationalized and the buses are not insured against third party risks and the department was both an insurer and assured and as such its liability was not limited to Rs. 2,000/- only.
What the learned Tribunal meant was that the department was both an insurer and owner of the vehicles and qua the owner its liability was not limited to the limits laid down in section 95 of the Motor Vehicles Act. The second reason assigned by it was that the language in which sub-section (2) of section 110 (d) of the aforesaid Act was couched indicated that a Tribunal could award compensation in excess of Rs. 2,000/- also. It accordingly awarded a sum of Rs. 6,000/- as compensation.
5. The first contention advanced on behalf of the appellants is that the transport department was an insurer and as such the Tribunal was incompetent to award compensation in excess of the limits laid down in section 95 of the Motor Vehicles Act.
6. Sub-section (1) of section 94 of the Motor Vehicles Act makes it obligatory for every person plying a motor vehicle in a public place to have it insured against third party risk and sub-section (3) empowers the appropriate Government to exempt from the operation of sub-section (1) any vehicle owned inter alia by a State Transport undertaking within the meaning of section 68A. The proviso to sub-section (3) runs as below :
"Provided that no such order shall be made in relation to any such authority unless a fund has been established and is maintained by that authority in accordance with the rules made in that behalf under this Act for meeting any liability arising out of the use of any vehicle of that authority which that authority or any person in its employment may incur to third parties."
7. It is not disputed that in Himachal Pradesh Transport has been nationalized and that the State transport u
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