The judgment establishes the principle that the liability of the insurance company for compensation in a motor vehicle accident is restricted to the amount specified in the insurance policy and the relevant provisions of the Motor Vehicles Act, 1939.

EQBAL, SINHA, JJ.

( 1 ) THIS appeal filed by insurance company is directed against the judgment and award dated 28. 2. 2004 passed by the First Additional District judge-cum-Motor Accidents Claims Tribunal, Chaibasa in Compensation Case No. 85 of 1988 awarding compensation of rs. 1,65,000 and fixed the liability upon the appellant insurance company.

( 2 ) THE facts of the case lie in a narrow compass: on 22. 2. 1988 deceased Dukhu Hansda was coming from Champua to Jamshedpur by bus bearing registration No. BRS 4450. The bus was overcrowded and was being driven rashly and negligently which resulted in an accident and deceased succumbed to the injuries. The appellant insurance company contested the case on the ground, inter alia, that the liability of the insurance company under the policy and also under the provisions of section 95 of Motor Vehicles act, 1939 is restricted to Rs. 15,000. The Tribunal after hearing the parties assessed the compensation and held that the entire amount is to be paid by the appellant insurance company.

( 3 ) MR. D. C. Ghose, the learned counsel appearing for appellant insurance company assailed the impugned judgment and award as being illegal and contrary to the terms and conditions of the insurance policy. The learned counsel submitted that the accident took place on 22. 2. 1988 when old Motor vehicles Act was in force, wherein liability of the insurance company in respect of the passenger is restricted to Rs. 15,000. The learned counsel has drawn our attention to exh. A which is insurance policy and submitted that no extra premium was paid for covering unlimited liability and, therefore, the Tribunal has erred in law in fastening the entire liability upon the insurance company.

( 4 ) MR. M. K. Dey, the learned counsel appearing for the owner of the vehicle submitted that the liability determined by the Tribunal needs no interference by this court. The learned counsel submitted that the Tribunal has given liberty to the appellant insurance company to realise excess amount from the owner of the vehicle. For better appreciation paras 23, 24 and 25 are worth to be quoted hereinbelow:

"the learned lawyer of the O. P. No. 1 has argued that since the vehicle in question was covered under a valid insurance certificate at the time of alleged accident, so the entire compensation amount payable in the present case is to be paid by the insurance company to indemnify the owner of the vehicle. It is also argued that driver of the offending vehicle was also holding a valid driving licence at the time of the said accident, which was renewed up to 24. 2. 1991 from 26. 1. 1984. The driver was also authorised to drive H. M. V. as would appear from Exh. B. So the insurance company cannot deny its liability. On the other hand, the learned lawyer of the O. P. insurance company has argued that under Motor Vehicles Act, 1939, as amended in the year 1982 the liability to pay compensation in case of death of the deceased in a motor vehicle accident by the insurance company is limited only up to Rs. 15,000, in case of death of a passenger of a stage carriage. In support of his contention the learned lawyer of the O. P. insurance company has referred case-law in New IndiaAssurance co. Ltd. v. Shanti Bai, 1995 ACJ 470 (SC) and argued that in the said case law it has been held that regarding the liability of insurance company to third party risk in case no special contract between the company and the owner of vehicle to cover unlimited liability - premium at the rate of 12 per passenger paid by owner as stated in tariff of company to cover liability of accident to passenger - Held: policy covered only statutory liability of Rs. 15,000 and it is immaterial that the insurance policy was a comprehensive policy. On the other hand, the learned lawyer of the owner O. P. of the vehicle has argued that from perusal of certificate of insurance, Exh. A it would appear that in the present case liability of insurance company wa