CMA/612/1994 of UNITED INDIA INSURANCE CO LTD Vs TTC TRANSPORT CORPN LTD, on 31 December 2002

:COMMON JUDGEMENT

(Judgment of the Court was made by P. SATHASIVAM,J.,)

Since all these three appeals arose from a common award of theMotor Accidents Claims Tribunal, Villupuram, they are being disposed of by thefollowing common judgement.

2. CMA.Nos.612 and 613 of 1994 are by M/s. United IndiaInsurance Company Limited. C.M.A.No.612 of 1994 is filed against the award ofthe Motor Accident Claims Tribunal, Villupuram dated 23.04.1993 made inM.A.C.T.O.P.No.376 of 1987, wherein the United India Insurance Companychallenges the conclusion of the Tribunal relating to negligence and quantumof compensation. C.M.A.No.613 of 1994 is filed against the award passed inM.A.C.T.O.P.No.227 of 1988, wherein the very same Insurance Company challengesits liability. Aggrieved by the same award, directing Tiruvalluvar TransportCorporation to pay 50% of the award amount, the Transport Corporation hasfiled C.M.A.No.1784 of 1996.

3. Among the three appeals, let us consider C.M.A.Nos.612 and613 of 1994, filed by M/s. United India Insurance Company Limited. As statedearlier, in C.M.A.No.612 of 1994, the Insurance Company challenges the finding regarding negligence and quantum of compensation determined by the Tribunal,which we shall consider after arriving a decision in the other appeals.

4. In C.M.A.No.613 of 1994, the Insurance Company challenges its liability. Mrs. N.B. Surekha, learned counsel for the Insurance Companyafter taking us through the claim of M/s. Annamalai Roadways Company (inshort "ARC"), claiming a sum of Rs.6,62,545.70 towards compensation for theloss of the goods carried in their lorry bearing registration No.TMF 3238 andthe impugned award of the Tribunal directing the Insurance Company toindemnify the loss caused to ARC in respect of the goods carried in theirlorry, would contend that in the light of Section 2 (i) (ii) of the Policy,which excludes the liability of the Insurance Company in respect of damage toproperty in control of the insured, the contrary conclusion arrived at by theTribunal cannot be sustained.

5. In the light of the said contention, let us consider the

necessary facts which necessitated ARC to file a claim for compensation, forthe loss of the goods carried in their lorry. It is the case of ARC that theyhired lorry bearing registration No. TMF 3238 belonged to one Chitty Babu -third respondent in CMA.No.613 of 1994 and transported the goods through 26way bills, valued at Rs.6,62,545.70 from Madras to Madurai. The goodsbelonged to third parties / consignors. While the said lorry, namely TMF 3238with goods was proceeding towards Madurai, at about 3.30 a.m. on 21.04.1987at Shenkuruchi near Ulundupet from North to South, the Tiruvalluvar TransportCorporation bus bearing registration No.TMF 9756, which was coming in theopposite direction, driven in a rash and negligent manner, dashed against thelorry. It is further stated that as a result of the heavy impact, the buscaught fire and spread over to the lorry, causing total damage to the entireconsignments carried and also to the lorry. A criminal complaint had beenlodged by the driver of the lorry before the Tiruvallur Police Station inCrime No.96 of 1987. The loss to the goods is valued at Rs.6,62,545.70. Theaccident occurred as a direct result of the rash and negligent driving on thepart of the bus driver. It is alleged that as the owner of the bus, firstrespondent is vicariously liable to compensate the loss of Rs.6,62,545.70.

6. Before going further, it is relevant to refer the case of ARC, as pleaded in their claim petition (O.P.No.227/88). In Column 24, subpara 4 it is stated.

"..... As owner of the Transport bus the first respondent is vicariouslyliable to compensate the loss of Rs.6,62,545.70. to the petitioner,consignors and consignees (emphasis supplied).

In sub-para 6 it is stated,

"The petitioner has claimed a sum of Rs.6,62,545.70 as damage of the goods asper the list attached herewith. The details of way bill numbers anddescription of goods which were consigned and carried in the lorry are givenin the said list. The respondents are liable to compensate the damages to thepetitioner at Rs.6,62,545.70. Hence this petition."

7. It is contended on behalf of the Insurance Company that as

per the statutory provisions and the Policy of Insurance, they are liable toindemnify and pay compensation in respect of bodily injury or death and damageto the properties belonging to third parties. Though ARC has produced numberof documents as Exs.R.1 to R.52 to show that the goods were entrusted to themfor transport by various persons, admittedly, the owners of the goods have notfiled any claim petitions before the Tribunal. It is relevant to note that asper Section 166(1)(b) of the Act, the "owner of property" alone is permittedto make an application for compensation. In the light of the said statutoryprovision (i.e., Section 166 of 1988 Act) and in view of Section 2 (i) (ii) ofthe Policy, it is clear that the owner of the goods alone is entitled to claimcompensation from the Tribunal. In our case ( MACTOP.No.227 of 1988), thoughARC has claimed that they are the owner of the goods entrusted to them, thesaid question cannot be gone into by the Tribunal. We have already referredto the claim of ARC vide sub-para 4 and 6 in Column 24, as extracted above.It is not clear whether ARC has filed the said claim petition as owner orconsignor or on behalf of the consignees. Therefore, in the light of theparticulars furnished in the claim petition (O.P.No.227 of 1988), we are ofthe view that the said question can not be agitated before the Tribunal.

8. In this regard learned counsel for the Insurance Company

8. In this regard learned counsel for the Insurance Company has relied on the earlier Division Bench decision of this Court in the case ofUnited India Insurance Company Limited vs. K.A.R.N. Janarthanam reported in1988 ACJ 503. The facts before the Division Bench are as follows: Theclaimant therein filed a petition under Section 110-A of the Motor VehiclesAct claiming compensation for damages caused to his goods at about 10.30 p.m.on 05.07.1977 for the lorry bearing registration No.MSL 771. He had booked aconsignment of 42 bales of MCU 5 cotton worth Rs.70,000/- on 05.07.1979 fromJayam Ginning Factory at Theni by the second respondent's lorry to be carriedto Rajapalyam. Freight was to be paid at the destination. The lorry wasdriven by second respondent's driver, who has been impleaded as firstrespondent. It left Theni at 7.00 p.m. and due to the rash and negligentdriving by the first respondent, the load of cotton came into contact with theelectric wire running east to west in the north south road, as a result ofwhich the entire 42 bales of cotton were burnt. Hence, he claimed acompensation of Rs.70,000/- from the owner of the lorry, being the secondrespondent and the Insurance Company with which the lorry had been insured,being the third respondent. On behalf of the Insurance Company it wassubmitted that when the policy issued contains a specific term in Clause (1)Sub-clause (d) of Section 11 that it shall not be liable in respect of damageto property belonging to or held in trust by or in the custody or control ofthe insured or a member of the insured's household or being conveyed by themotor vehicle, no liability could be fastened on it by the petitioner. It isfurther contended that when contractual liability had been excluded, thetransaction entered into between P.Ws.1 and 4 and the consequent happeningwould not be binding upon it. On behalf of the second respondent it wascontended that the petition filed under Section 110 -A of the Motor VehiclesAct itself is not maintainable on the finding that the goods damaged are notproperties of a third party. The Division Bench after finding that the goodsinvolved in the petition are not properties of a third party, coming withinthe scope of Section 95 (1) (b) (i), of Motor Vehicles Act 1939 and in view of Section 1 10 held that the claims Tribunal would have no jurisdiction toentertain such a claim. The Division Bench further held that, "the Tribunalconstituted under Section 110 of Motor Vehicles Act, 1939 could onlyadjudicate upon claims for compensation in respect of damage to any propertyof a third party so arising. Therefore, the petition as filed was notmaintainable before the Tribunal at Madurai. "

After holding so, the Division Bench allowed the appeals filed by theInsurance Company.

9. Mr.L. Mohan, learned counsel for ARC relying on a Full Bench decision of the Madhya Pradesh High Court in the case of HarishankarTiwari vs. Jagru reported in 1987 ACJ 1 would contend that the claim made byARC before the Tribunal is maintainable and the Tribunal has rightly grantedthe relief. In the light of the said contention, we have gone through thedecision of the Madhya Pradesh High Court. We have already referred to therelevant provisions of the Motor Vehicles Act both in 1939 and 1988 Acts aswell as the Division Bench decision of this Court i.e., 1988 ACJ 503 (citedsupra) and with respect, we are unable to share the view expressed by theMadhya Pradesh High Court and we follow the view of the earlier Division Benchdecision of this Court.

10. Sections 165 and 166 of 1988 Act are corresponding to

Sections 95 (1) (b) (i) and 110-A of the 1939 Act. Accordingly, by applyingthe said principles laid down by the Division Bench and in view of thelanguage used in Sections 165 and 166 of 1988 Act, we are of the view thatSection 166 of the Act does not cover the liability in question and damage tothe property as envisaged under. The Section only relates to the property ofa third party and does not cover the loss to the property carried in a "publiccarrier" held in trust by the carrier for the owners of the goods. Inasmuchas the claimant in O.P. No.227 of 1988 is not a third party, coming withinthe scope of Sections 165 and 166 of the Act, we are of the view that theClaims Tribunal would have no jurisdiction to entertain such a claim. It is awell settled law that the Tribunal constituted under Section 165 of 1988 Actcould only adjudicate upon the claims for compensation in respect of theaccident involving death or bodily injury to persons arising out of the use ofmotor vehicles or damages to any property of a third party, so arising. Inthe light of uncertain details furnished in Column 24 sub-para 4 and 6 inO.P.No.227 of 1988 by ARC, the said claim petition was not maintainable beforethe Tribunal. The Tribunal failed to consider the above material aspect andcommitted an error in adjudicating the issue by passing an award as claimed infavour of the claimant / ARC. Accordingly, we set aside the same.

11. Learned counsel appearing for Tiruvalluvar Transport Corporation - appellant in CMA.No.1784 of 1996 though questions the findingregarding negligence and apportionment by the Tribunal, in the light of theorder passed by this Court in CMA.No.585 of 1995 dated 26.03.200 2, confirmingthe very same finding on the negligence in MCOP.No.376 of 1987 (disposed ofalong with OP.No.227 of 1988), we reject the said contention. However, inview of our conclusion, namely the claim petition filed by ARC (Claim PetitionNo.227 of 1988) claiming compensation for the damages to the goods as carrier, is not maintainable before the Motor Accident Claims Tribunal, the appellantTransport Corporation is also entitled to the benefit of such conclusion.

12. In the light of what is stated above, we set aside the award ofthe Tribunal granting compensation of Rs.6,62,545.70 in favour of ARC.Consequently, we allow CMA.No.613 of 1994 filed by the Insurance Company andCMA.No.1784 of 1996 filed by Tiruvalluvar Transport Corporation. In view ofthe said orders, the question raised in CMA.No.612 of 1994 need not beconsidered; hence, the same is dismissed. No costs. Consequently, connectedCMP., is also dismissed.

Index:YesInternet: Yeskh

To1. The Subordinate Judge (MACT)Villupuram (with records).

2. The S.O., V.R. Section,High Court, Chennai.