LexMOTOR OWNERS INSURANCE CO. LTD. versus JADAVJI KESHAVJI MODI & ORS.
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A 860 B c D E F G MOTOR OWNERS INSURANCE CO. LTD. v. JADAVJI KESHAVJI MODI & ORS. September 29, 1981 [Y.V. CHANDRACHUD, C.J., S. MUll.TAZA FAZAL ALI AND D.A. DESAI, JJ.] Motor Vehicles Act 1939, S. 95(2) as amended by Motor Vehicles (Amend- ment) Act 1956,.S. 14-Scope of. "in all"-crany one accident"-Meaning of, Section 95 of the Motor Vehicles Act, 1939 prescribes the requirements of an insurance policy and the limits of liability thereunder. By sub-section (1) of section 95, a policy of insurance must insure the person or classes of persons specified in the policy to the extent specified in sub-section (2) against any liabi- Jity which may be incurred by him or them in respect of the death of or bodily injury to any person caused by or arising out of the use of the vehicle in a public place. Section 95(2) of the Act as it originally stood read thus : "95(2) : Subject to the proviso to sub·section (1) a policy of insurance shall cover any liability incurred in respect of any one accid~nt upto the following limits, namely :- (a) \vhcre the vehicle is a vehicle used or adapated to be used for th~ carriage of goods, a limit of twenty thousand rupees ...... ". This provision was substituted by a new clause by section 74 of the Motor Vehicles (Amendment) Act, 1956 with effect from February 16, 1957. The amended clause read : "9j(2) (a) :-Where the vehicle is a goods vehicle, a limit of twenty thousand rupees in all, including the liabilities, if any, arising under the Work- men's Compensation Act, 1923, in respect of the death of, or bodily injury to, employees (other than the driver), not exceeding six in number, being carried in the vehicle". This provision underwent further amendment by the Motor Vehicles (Amendment) Act, 1969 which came into force on March 2, 1970. A colJision took place between a motor car and a goods truck in February ff 1966 as a result of which the driver of the car died instantaneously and the person travelling in the car sustained injuries. The truck was insured against third party risk with the appeliant·insurance company. t MOTOR OWNERS INSURANCE Y J.K. MODI 861 The heirs and legal representatives of the deceased filed an application before the Motor Accidents Claims Tribunal, under section llO·D of the Act~ claiming compensation in the sum of Rs. 30,000 for the death caused in the acci- dent. The person who was injured filed a separate application asking for com- pensation of Rs. 10,000 for the injuries suffered by him. The Tribunal dismissed both the applications on the ground that respondent No. 3 could not be said to have been driving the truck rashly and negligently at the tirue of the accident. The claimants filed separate appeals in the High Court, which awarded a compensation of Rs. 19,125 to the heirs of the deceased and Rs. 10,000 to the injured person. In the appeals to this Court it was contended on behalf of the appellant- insurance company : (i) that under clause (a) of section 95(2) as it stood at the material time, the liability of the insurer under the statutory policy taken by the owner of the goods vehicle is limited to Rs. 20,000 in all and, therefore, the insurer cannot be asked to pay compensation in excess of that amount, and that the liability to pay the balance must be fixed on the owner of the goods vehicle who would be vicariously responsible for the negligence of his employee who was driving the goods vehicle, and (ii) that the Amendment Act of 1956 which came into force on February 16, 1957 introduced the words 'in all' in clause (a) and that these words were introduced to limit the overall liability of the insurer to twenty thousand rupees. Dismissing the appeals, HELD : 1. The High Court took a just, correct and realistic view of the A B c D matter by holding that, under the statutory policy the appellant-insurance com- E pany is liable to pay the full amount of compensation to the heirs of the decea- sed and to the passenger travelling in the car, each amount being less than Rs. 20,000. [880 G-H] The purpose of law is to alleviate, not augment, the sufferings of the people. The award of compensation depends upon a variety of factors, including the extent of monetary deprivation to which the heirs of the deceased are subjected. (870 G] 3. By common practice and the application of recognised rules of statu~ tory construction, harsh consequences following upon an interpretation are not cons
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