An 'Act policy' does not cover passenger liability, distinguishing it from comprehensive policies per Motor Vehicles Act, influencing compensation rulings.

1. This miscellaneous appeal has been filed by the appellant insurance company under S.173 (1) of Motor Vehicles Act, 1988 being aggrieved by the award dated 29.8.2019 passed by 3rd Additional MACT, Barwani in MACC / 16/2018.

2. Brief facts of the case are that respondent Nos. 1 to 5 preferred a claim application before the Claims Tribunal alleging that they are legal heirs and dependants of deceased Ravindra. On 6.3.2017, Ravindra was travelling in Scorpio bearing No. MP 09 - BC 3788 which was being driven rashly and negligently by respondent No. 7 due to which it overturned resulting in grievous injuries and his death. The aforesaid vehicle was owned by respondent No. 6 and insured with the appellant, compensation was claimed on various grounds.

3. The respondent Nos. 6 and 7 were proceeded ex parte and appellant denied all averments.

4. The Claims Tribunal framed issues and after recording the evidence held that the accident occurred due to rash and negligent driving on the part of respondent No. 7 and awarded compensation in favour of respondent Nos. 1 to 5 to the tune of Rs.10,15,000 from the date of filing of claim petition till realization.

5. Learned counsel for the insurance company filed this appeal submitting that policy in question was for 'liability only', therefore, neither the risk of the passengers travelling in the said vehicle was statutorily required to be covered nor was covered under the policy and, therefore, it being a liability only policy, i.e., Act only policy, the liability of the occupant travelling in the vehicle could not have been fastened upon the appellant. The Claims Tribunal has committed error in holding that the deceased was a third party without appreciating the evidence that deceased was a passenger travelling in the private car and, therefore, by virtue of S.147 of the Motor Vehicles Act, risk of the passengers other than a public service vehicle is not required to be covered nor the same was covered under the policy issued which was duly proved by the appellant, therefore, no liability could have been fastened upon the appellant. Hence, it is prayed that the impugned award be set aside against the appellant and appeal be allowed.

6. Learned counsel for the respondents / claimants supported the impugned award and prayed for rejection of the appeal.

7. Heard the learned counsel for the parties and perused the record.

8. S.147 of the Motor Vehicles Act, 1988 reads as under:

"147. Requirement of policies and limits of liability. - (1) In order to comply with the requirements of this Chapter, a policy of insurance must be a policy which -

(a) is issued by a person who is an authorised insurer; and

(b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2) -

(i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person including owner of the goods or his authorised representative carried in the motor vehicle or damage to any property of a third party caused by or arising out of the use of the motor vehicle in a public place;

(ii) against the death of or bodily injury to any passenger of a transport vehicle, except gratuitous passengers of a goods vehicle, caused by or arising out of the use of the motor vehicle in a public place."

9. According to S.147 (1) (b) (ii) of Motor Vehicles Act, death of or bodily injury to any passenger of a transport vehicle, except gratuitous passengers of a goods vehicle, caused by or arising out of the use of the motor vehicle in a public place (sic).

10. In the present case, appellant filed insurance policy, Exh. D - 1 in which it has been