ORIENTAL INSURANCE CO. LTD. versus SONY CHERIAYAN

Citation: [1999] SUPP. 1 S.C.R. 622 · Decided: 19-08-1999 · Supreme Court of India · Bench: S. SAGHIR AHMAD · Disposal: Appeal(s) allowed
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Judgment (excerpt)

A 
ORIENTAL INSURANCE CO. LTD. 
v. 
SONY CHERIA YAN 
AUGUST 19, 1999 
B 
[S. SAGHIR AHMAD AND R.P. SETHI;JJ.] 
Motor Vehicles Act, 1988-Sections 2(13), 2(14), 2(31), 66(1) third 
proviso, 77, 78 and 79(2)-Truck, insured only for carriage of goods within 
the .meaning of the Act and eligible under the permit issued.to it to carry only 
C unhazardous goods-Truck caught fire while carrying ether solvent, a highly 
flammable and. hazardous substance-Claim filed against the insurer for 
loss-Held, not maintainable-Central Motor Vehicles Rules, 1989, Rules 
9/(c), 129, 137, and Tables/, If, and lll. 
Insurance-Liability of insurer-Interpretation of insurance policy-
D Held, should be strictly construed to determine the extent of insurer's liability. 
Words and Phrases-'Ethyl ether' and 'ether'-Meaning of-In the 
context of Central Motor Vehicles Rules 1989. 
The respondent's truck was insured with the appellant. It caught fire 
E while carrying barrels of ether solvent. Respondent filed a claim before the 
Distric_t Consumer Disputes Redressal Forum against the Insurance Company 
for a certain sum together with interest. The complaint was dismissed. 
However, the appeal filed before the State Commission was allowed in favour 
of the respondent. The revision filed before the National Commission was 
F also allowed in favour of the respondent. Hence this appeal. 
It was contended by the appellant that Table Ill to Rule 137 of the 
Central Motor Vehicle Rules contains the list of hazardous and toxic 
chemicals and one of the items described in the Table was 'ethyl ether' which 
was classified as flammable, and as per the 'permit' issued to the respondent, 
G he could transport only non-hazardous articles, and the insurance policy 
covered only those goods which were permissible under the Motor Vehicles , 
Act to be carried by the respondent. 
It was contended by respondent that what was carried by the respondent 
was 'ether solvent' and not 'ethyl ether' which was not specified 'in ttole III 
II 
622 
ORIENTAL INSURANCE CO. LTD. v. SONY CHERIA YAN [S. SAGHIR AHMAD, J.) 623 
:.,. 
. appended to Rule 137 of the Central Motor Vehicles Rules. 
A 
Allowing the Appeal, the Court · 
HELD: 1. The insurance policy between the insurer and the insured 
.-. 
represents a contract between the parties. Since the insurer undertakes to 
compensate the loss suffered by the insured on account of risks covered by B 
the insurance policy, the terms of the agreement have to be strictly construed 
to determine the extent of liability of the insurer. The insured cannot claim 
anything more than what is covered by the insurance policy. [627-G-H) 
2. The respondent was carrying ether solvent in his truck, which has 
been described in Table III to Rule 137 of the Central Motor Vehicles Rules, C 
1989 as a hazardous and highly flammable article. Since under the "permit" 
granted.to the respondent he could transport only non-hazardous articles, 
and the insurance policy covered only those goods which were permissible 
under the Motor Vehicles Act to be carried by the respondent, the judgments 
passed by the State and National Commissions are incorrect. [627-E-F) 
D 
3. Ether solvent is only a descriptive name for ether, which is widely 
used as a solvent not only in the industry, but also in chemical manufacture 
and in research laboratories. Ether and ethyl ether are the same substance 
..., 
and the term "ether" is used synonymously with "ethyl ether". 
(628-G-H; 629-A) E 
Hawely's Condensed Chemical Dictionary, 11th Edn., McGraw-Hill 
Encyclopedia of Chemistry, 2nd Edition, referred to. (628-E) 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4913of1997. 
From the Judgment and Order dated 10.2.97 of the National Consumers 
Disputes Redressal Commission, New Delhi in R.P. No. 580of1996. 
T.L.V. Iyer, and M.J. Paul for the Appellant. 
Subramonium Prasad for the Respondent. 
The Judgment of the Court was delivered by 
F 
G 
S. SAGHIR AHMAD, J. Respondent's truck was insured with the 
appellant. On 19.4.1994, while the truck was on its way from Bombay to 
Allapuzha carrying 15 barre.ls of Ether Solvent, it caught fire at Bisalkoppa H 
624 
SUPREME COURT REPORTS (1999) SUPP. I S.C.R. 
,. 
A near Hubli, which gave rise to a Claim Petition being filed by the respondent 
..: 
before the District Consumer Disputes Redressal Forum, Allapuzha, in the 
sum of Rs. 2,75,000, along with interest @ 18 per cent per annum from 
19.4.1994, but the Complaint was dismisse
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