By the Court.—Heard Sri Dinkar Mani Tripathi, Advocate, for appellant, Sri Arun Kumar Shukla and Sri Vijay Kumar Dwivedi, Advocates, for respondents and perused the record.

2. U.P. State Road Transport Corporation (hereinafter referred to as “UPSRTC”) has filed this appeal being aggrieved by judgment and award dated 25.3.2003 passed by Motor Accident Claims Tribunal/Additional District Judge, Court No. 1, Varanasi in Motor Accident Claim Petition No. 197 of 2001.

3. Tribunal was moved by heirs of deceased who died in accident involving appellant-Corporation’s Bus. Claim Petition was partly allowed by awarding Rs. 7,17,000/-. However, while passing award, Tribunal exonerated Insurance Company and directed Corporation to pay the awarded amount.

4. The only ground for which we are being addressed is that despite the fact that ownership of the vehicle remained with owner and the Driver was holding effective driving license, the vehicle was insured with New India Insurance Company and the finding of fact on issues No. 2 and 3 were in their favour, despite that Tribunal has exonerated Insurance Company and the only reason given is that since private company with whom contract of insurance was there was attached with UPSRTC and hence the Insurance Company would not be liable.

5. The facts which are important for our purpose are that accident is not disputed. The only question is exoneration of Insurance Company by Tribunal and holding the appellant solely responsible. It is an admitted position of the fact that Bus which met with accident was being run by Driver but under control and possession of Corporation. The fact as pleaded is that the Corporation entered into an agreement with owner of Bus No. UP 65H/2999 to ply the bus under a contract according to which Driver of Bus would be an employee of owner. The Bus was plying under the contract with Corporation and as per contract, for any tortious act of Driver, owner would be responsible. Tribunal has held against appellant.

6. While admitting this appeal, following order came to be passed:

“Admit.”

Issue notice by RPAD returnable at an early date.

Until further orders, the operation of the impugned judgment and award dated 25-3-2003 passed by Motor Accident Claims Tribunal/Additional District Judge, Court No. 1, Varanasi in Motor Accident Claims Case No. 197 of 2001-Smt. Sukha Devi and others v. U.P. State Road Transport Corporation-shall remain stayed, provided the appellant deposits Rs. 5,00,000/- with the concerned Tribunal within two months from today. If such amount is deposited, the claimants shall be entitled to withdraw 50% amount with security (other than cash and Bank guarantee) and balance amount without security.

The amount of Rs. 25,000/- deposited in this Court under Section 173 of the Motor Vehicles Act shall be remitted to the concerned Tribunal within three weeks from today and the aforesaid amount shall be duly accounted for while making deposit before the Tribunal under this order.

Balance amount shall be subject to final orders being passed after hearing the parties.”

7. It is an admitted position of fact and undisputed that owner has placed vehicle with Corporation but the insurance continued even on date of accident.

8. The only ground raised is whether it would be the liability of New India Insurance Company or of appellant to pay compensation to claimants. It is submitted that it was not in issue as to who would be liable to pay compensation. It is not mentioned how there was any breach of condition. Tribunal while considering issues-2 and 3 and observing that vehicle was insured, has held that vr% ;g ugha dgk tk ldrk fd nq?kZVuk ds le; cl pkyd ds ikl oS/k MªkbZfoax ykblsUl ugha Fkk and Issue-3 was decided in negative. Despite this, the has Tribunal has exonerated the Insurance Company without assigning reason as why Insurance Company would not be liable to indemnify the owner of the vehicle and this finding that contract between UPSRTC and owner of