ORIENTAL INSURANCE CO. LTD. versus JHUMA SAHA AND ORS.

Citation: [2007] 1 S.C.R. 979 · Decided: 16-01-2007 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Appeal(s) allowed

Cited by 2 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

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ORIENTALINSURANCECO.LTD. 
A 
v. 
JHUMA SAHA AND ORS. 
JANUARY 16,2007 
[S.B. SINHAAND MARKANDEYKATJU, JJ.] 
B 
Motor Vehicles Act, 1988: 
s.147(l)(b) read with s.166-Third party insurance-Vehicle met 
with accident-Resulting in death of owner driving the vehicle-Held, · 
additional premium for entire risk of death or bodily injury to owner not c 
having been paid, S-l 47(J)(b) which covers risk of a third party only 
would be attracted-Insurer cannot be fastened with any liability toward 
owner. 
__, ... 
An insured vehicle, which was being driven by its owner, dashed 
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. against a tree and as a result of the said accident the owner died. The claim 
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petition under section 166 of the Motor Vehicles Act, 1988 was resisted 
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by the insurer on the ground that since the insurance policy was a third 
party in nature and did not cover the owner, the claimants were not entitled. 
to any compensation. The Tribunal rejected the contention. The appeal of 
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the insurer was held by the High Court as not maintainable. 
In the appeal it was contended for the insurer-appellant that in 
view of s.147 of the Act, the jurisdiction of the Tribunal was confined to 
a third party claim, and, as such, the impugned judgment could not be 
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sustained. 
Allowing the appeal, the Court 
HELD : 1.1. The additional premium was not paid in respect of the 
entire risk of death or bodily injury of the owner of the vehicle, and, 
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therefore, s.147(l)(b) of the Motor Vehicles Act, 1988, which in no 
uncertain terms covers the risk of a third party only, would be attracted 
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in the instant case. The accident did not involve any motor vehicle other 
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than the one which the owner was driving. 
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[Paras 13 and 10) (984-A, 983-B) 
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979 
980 
SUPREME COURT REPORTS 
[2007] 1 S.C.R 
A 
Dhanjraj v. New India Assurance Co. Ltd. & Anr., [2004] 8 SCC 553, 
B 
relied on. 
1.2. Liability of the insurer-Company is to the extent of indemnification 
of the insured against the respondent or a injured person, a third person 
or in respect of damages of property. Thus, if the insured cannot be 
fastened with any liability under the provisions of Motor Vehicles Act, the 
question of the insurer being liable to indemnify insured, therefore, does 
not arise. [Para 11] [983-C-D] 
National Insurance Co. Ltd, Chandigarh v. Nicol/eta Rohtagi and 
C 
Ors., (2002) 7 SCC 456, cited. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 280 of2007. 
From the Final Judgment and Order dated 28.10.2003 of the Gauhati 
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High Court in C.R.P. No. 69/2003. 
Santosh Paul, Abhishek K. Rao, Kaveri Mohan and M.J. Paul for the 
Appellant. 
Sarada Devi for the Respondents. 
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The Judgment of the Court was delivered by 
S.B. SINHA, J. : Leave granted. 
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2. This appeal is directed against judgment and order dated 28.10.2003 
passed by the Gauhati High Court in C.R.P. No. 69 of 2003 whereby and 
whereunder the appeal preferred by the appellant herein was dismissed. 
3. The deceased was the owner of an insured vehicle bearing 
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Registration No. TR 03-2304, a maruti van. While he was driving the said 
vehicle, allegedly, in order to save a goat which was running across the 
road, the steering of the vehicle failed and it dashed with a tree on the road 
side. He suffered injuries. He later on succumbed thereto. 
4. On the aforementioned premise a claim petition under Section 166 of 
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the Motor Vehicles Act, 1988 was filed. 
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ORIENTAL INSURANCE CO. LTD. v. JHUMASAHA[SINHA,J.] 981 
5. The insurer resisted the claim petition when served with a notice, 
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inter alia, contending as under : 
"That as per Motor Vehicle Acts and Rules the owner is not 
entitled to get any compensation if he drives the vehicle and falls 
in an accident- As the Insurance Policy is a third party in nature-
The contract between the insured and insurer is that if any accident 
occurred out of the use of Motor Vehicle then only third party is 
entitled to get compensation. The insurer and insured is the first 
and second party and other than the all are third party. But in this 
case as per the version of the petition the deceased was the owner 
of the vehicle and was driving the vehicle and he met with an 
acddent. Though the deceased had valid driving licence still he is 
not the third party as per Rules and Acts. Hence the petitioners are 
not entitled to get any compensation ... " 
6. The said contention of the appellant, however did no

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