The insurer's liability under S.96 of the Motor Vehicles Act, 1939, is conditional on a judgment or award against the insured.

S.S.SANDHAWALIA, J.

1. Whether the insurer can still be held liable under S.96 of the M.V. Act, 1939, when the insured has himself been exonerated of such liability is the pristinely legal question which falls for determination before this Full Bench. Equally at issue in this context is the direct discordance of views in the two Division Bench judgements of this Court in Alwar Motor Association (P.) Ltd., Alwar V/s. Hazari Lal, (1964) 66 Pun LR 804 and New India Assurance Co. Ltd., New Delhl V/s. Norati Devi, AIR 1978 Punj and Har 113.

2. The facts, though brief disclose a long delay which sometimes occurs even in the urgent compensation cases of claims by victims of motor vehicle accidents. Way back on the 4th of Dec. 1970, Gurmel Singh deceased the son of Bachan Singh respondent was fatally run over by truck No. HRK 6664. An application for compensation on behalf of the dependents of the deceased was preferred against Prabh Dayal, the driver of the truck, Dai Ram the alleged owner thereof, and the Oriental Fire and General Insurance Company Ltd., who were the insurers of the offending vehicle. The case of the claimants rested on the ground that the truck was being rashly and negligently driven by Prabh Dayal driver. In resisting the claim application the respondents took the plea that Dai Ram was not the owner of the truck though it was admitted that it stood insured with the Oriental Fire and General Insurance Co. Ltd. and was driven by Prabh Dayal at that time. The Tribunal on issue No.3 held that Dai Ram was not the owner of the truck and in fact M/s. Bal Kishan Ram Dhari of Samalkha were its real owners who were not impleaded as such. It was, however, found that the death of Gurmel Singh deceased was on account of rash and negligent driving by Prabh Dayal and compensation therefor was assessed at Rs. 16,600. The claim petition, however, was dismissed in view of the aforesaid finding on issue No.3. However, on appeal the dismissal of the claim application was set aside and the matter was remanded to the Tribunal to decide the same afresh in the light of the observations of the appellate Court. For the purposes of this reference it is unnecessary to advert to the chequered history of the second trial before the Tribunal and it suffices to mention that during the course thereof Prabh Dayal driver died and the counsel for the claimants made a statement to the effect that he had left no estate and consequently his name be struck off from the array of respondents which was accordingly done. The Tribunal then found that M/s. Bal Kishan Ram Dhari were the owners of the truck and not Dai Ram respondent. The firm stand taken on behalf of the owners before the tribunal was that the evidence recorded at the original trial when they were not parties to the proceedings could not be looked at for fastening them with liability. Consequently it was contended that there was no evidence against them that the death of the deceased was caused by rash and negligent driving of the truck by Prabh Dayal, after they were impleaded as parties. This stand found favour with the Tribunal and as a necessary corollary thereof M/s. Bal Kishan Ram Dhari the owners were exonerated from all liability. Nevertheless the Tribunal found that the appellant insurer M/s. Oriental Fire and General Insurance Co. Ltd. would continue to be liable in view of the observations in Norati Devi s case (AIR 1978 Punj and Har 113) (supra).

3. This appeal first came up before my learned brother S.P. Goyal, J. Learned counsel for the parties placed reliance on the conflicting views in Hazari Lal s (1964) 66 Pun LR 804 and Norati Devi s cases. Noticing that there was a direct conflict betwixt the two judgements, the matter has been referred to the Full Bench.

4. At the very outset it deserves highlighting that there is a long line of unbroken precedents (to which reference would inevitably follow hereinafter) in favour of the view that the liability of the insurer is co