LexORIENTAL INSURANCE CO. LTD. versus SUDHAKARAN K.V. & ORS.
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[2008] 9 S.C.R. 367 .l .. ORIENTAL INSURANCE CO. LTD. A v. SUDHAKARAN K.V. & ORS. (Civil Appeal No. 3634 of 2008) MAY 16, 2008 B [S.B. SINHA AND LOKESHWAR SINGH PANTA, JJ] ~ Motor Vehicles Act, 1988: s.147 - Claim in respect of death of a pillion rider on a scooter - Liability of insurer - Held : Pillion rider in a two c wheeler was not treated to be a third party when accident took place owing to rash and negligent riding of the scooter and not of the driver of another vehicle - Judgment of High Court upholding the liability of insurer set aside. A petition was filed before the Motor Accident Claims D Tribunal claiming compensation for death of a pillion rider, who fell from the scooter of respondent no.1 and sue- cumbed to the injuries. The Tribunal held that the accident took place due to rash and negligent riding of respondent E no.1. It awarded a sum of Rs. 1,18.900/- with 12% interest from the date of filing of the claim petition till the realiza- tion, holding that since existence of insurance policy was admitted, the insurance company was also liable. The Di- ..., vision Bench of the High Court having upheld the award, F ~ the insurance company filed the instant appeal. The question for consideration before the Court was: whether the pillion rider on a scooter would be a third party within the meaning of Section 147 of the Motor Vehicles Act, 1988? G Allowing the appeal, the Court ' -t HELD: 1.1 The provisions of the Motor Vehicles Act, 1988 and, in particular, Section 147 of the Act were en- 367 H 368 SUPREME COURT REPORTS [2008] 9 S.C.R. ... A acted for the purpose of enforcing the principles of so- cial justice. It, however, must be kept confined to a third party risk. A contract of insurance which is not statutory in nature should be construed like any other contract. In the instant case, the contract of insurance was entered B into on or about 2.12.1992. It was 'A policy for act liability' meaning thereby a third party liability and not covering the risk of the owner or a pillion rider. Indisputably, a dis- ,. tinction has to be made between a contract of insurance in regard to a third party and the owner or the driver of c the vehicle. An exception in the contract of insurance has been made, i.e., by covering the risk of the driver of the vehicle. The deceased was, indisputably, not the driver of the vehicle. In view of the terms of the contract of in- surance, however, she would not be covered thereby. D [para 7, 10,14-16] [371-G; 372-F-G; 373-F-G; 374-C] 1.2 The law which emerges from the decisions of the ~ Court is: (i) the liability of the insurance company in a case of this nature is not extended to a pillion rider of the mo- tor vehicle unless the requisite amount of premium is paid E for covering his/her risk (ii) the legal obligation arising un- der Section 147 of the Act cannot be extended to an injury or death of the owner of vehicle or the pillion rider; (iii) the pillion rider in a two wheeler was not to be treated as a third party when the accident has taken place owing to rash F and negligent riding of the scooter and not on the part of .. the driver of another vehicle. [para 19) [375-H; 376-A-B] United India Insurance Co. Ltd., Shim/a v. Tilak Singh and Ors. [(2006) 4 SCC 404]; National Insurance Co. Ltd. v. Laxmi Narain Dhut [(2007) 3 SCC 700), Oriental Insurance G Co. Ltd. v. Meena Variyal [(2007) 5 SCC 428) and New India Assurance Co. Ltd. v. Ved Wati (2007) 9 SCC 486 .. ~ • United India Insurance Company Ltd. v. Serjerao & Ors. 2007 (13) SCALE 80; Ghulam Mohammad Dar v. State of H J&K and Ors. (2008) 1 SCC 422; The New India Insurance ORIENTAL INSURANCE v. SUDHAKARAN K.V. 369 & ORS. [S.B.SINHA.J:] Company v. Darshana Devi & Ors. 2008 (2) SCALE 432; and A United India Insurance Co. Ltd. Shim/a v. Tilak Singh and Ors. (2006) 4 sec 404 - referred to. CIVILAPPELLATE JURISDICTION: Civil Appeal No. 3634 From the final Judgment and Order dated 22.3.2006 of B the High Court of Kerala at Ernakulam in M.F.A. No. 536of1999 Anchal Jain, Santosh Paul and M.J. Paul for the Appellant. Purnima Bhat and K. Sarada Devi for the Respondents. The Judgment of the Court was delivered by c S.B.SINHA.J: Leave granted. 1. This appeal is directed against a judgment and order dated 22.3.2006 passed by the High Court of Kerala at Ernakulam in M.F.A. No. 536of1999 whereby and whereunder D ~ the appeal preferred by the
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