The insurance company is not liable to pay compensation for an unauthorised passenger in the goods vehicle, and is entitled to recover the compensation amount from the owner of the goods vehicle after paying the same to the victim.

The revision petitioner M/s.New India Assurance Company Ltd is the 4th respondent in the Motor Accident Claim Petition.

2. The first respondent filed the claim petition in M.C.O.P.No.235 of 1998 on the file of the Motor Accident Claims Tribunal (Principal District Judge), Vellore for compensation in respect of the grievous injuries sustained by her in a motor vehicle accident. A goods vehicle bearing registration No.TN-23-B-7273 and insured with the revision petitioner herein and another bus bearing registration No.TN-27-Z-6565 and insured with the 3rd respondent herein were involved in the accident.

3. While the claim made by the first respondent was allowed, it was held by the learned Principal District Judge that the accident occurred on account of contributory negligence of both the drivers and therefore apportioned liability at 50% each and directed the respective insurance companies liable to pay the compensation amount.

4. This revision is mainly based on the ground that since the first respondent's claim was in respect of an unauthorised passenger travelling in the goods vehicle, who sustained injuries, the revision petitioner-Insurance Company is not liable to pay the compensation. Though such contention was raised before the Tribunal, the learned Principal District Judge negatived the same and passed the impugned order. Hence, the revision.

5. Heard Mr.S. Jayasankar, learned counsel for the revision petitioner and Ms.P.Jeya and Mr.A.S.Ekambaram, learned counsel appearing for respondents 1 and 3 respectively.

6. There is no controversy regarding the findings rendered by the Motor Accident Claims Tribunal (Principal District Judge), with reference to the negligence and quantum of compensation.

7. In this context, the learned counsel appearing for the revision petitioner herein referred to the decision NEW INDIA ASSURANCE COMPANY v. SATPAL SINGH (2000 (1) S.C.C. 237) in support of his arguments that the revision petitioner is not liable to pay the compensation in respect of an unauthorised passenger in the goods vehicle. In view of the finding of the Tribunal, I am of the view that as per the ratio in the said decision, such contention of the revision petitioner has to be sustained. The only question now posed in this revision is with reference to the liberty to be extended to the revision petitioner to recover the amount from the owner of the goods vehicle after paying the compensation to the first respondent, as the revision petitioner is not duty bound to pay the compensation amount on the basis of vicarious liability for the simple reason that the policy of insurance had been violated in taking the gratuitous passenger in the goods vehicle.

8. In view of the above said reasons, there is no difficulty in concluding that on account violation of the policy condition, the revision petitioner/Insurance Company is not liable vicariously to pay the compensation amount (vide) the ratio laid down in the decision rendered by the Hon'ble Supreme Court referred supra. If that be so, learned District Judge (Motor Accident Claims Tribunal) ought to have given liberty to the revision petitioner to recover the amount from the owner of the vehicle after paying the same to the victim, namely, the first respondent herein. Thus, this Court is of the considered view that the order of the Motor Accident Claims Tribunal has to be modified to the extent pointed out in this revision.

9. Though the learned counsel for the 3rd respondent would also urge that the similar benefit should be extended to that Insurance Company also, as has been rightly pointed out by the learned counsel for the revision petitioner, the Court below held on the basis of the recorded evidence that the 3rd respondent herein is vicariously liable to pay the compensation for the fact that the vehicle insured with them is a passenger vehicle and therefore covered by the policy of insurance on the date of the accident. Hence, I am unable to accept the contention