caselaws
Supreme Court of India
Kalim Khan vs Fimidabee on 3 July, 2018Author: Dipak Misra
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Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 87858786 OF 2015
Kalim Khan & Others …Appellant(s)
Versus
Fimidabee & Others …Respondent(s)
J U D G M E N T
Dipak Misra, CJI
The legal representatives of the deceased Firoz preferred a
claim petition being MAC Petition No. 64 of 2006 before the
Chairman, Motor Accidents Claims Tribunal (for short, ‘the
tribunal’), Washim under Section 166 of the Motor Vehicles Act,
1988 (for brevity, “the Act”) claiming compensation of Rs. 15 lacs
on the foundation that the deceased was an Assistant Teacher in
Urdu Primary School at Pusad run by Zilla Parishad, Yeotmal
and was drawing monthly salary of Rs. 8,123/ and they were
Signature Not Verified
dependent on the income of the deceased. The assertion in the
Digitally signed by
CHETAN KUMAR
Date: 2018.07.03
16:55:20 IST
Reason:
claim petition was that land situated in survey number 136 of
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village Kajleshwar, Tq Karanja, Washim District was belonging to
Respondent No. 1 who had commenced the work for digging of
well in the above agricultural land. On 08.04.2005 at about 4.15
p.m., when the deceased was returning towards his house after
purchasing certain articles from the grocery shop, a heavy stone
came flying and fell on his head, as a consequence of which, he
sustained grievous injuries and was carried for treatment in a
jeep to the hospital where he was declared dead. The case of the
claimants before the Tribunal was that the stone fell on the
deceased due to blasting operation carried out for digging of well
in the field of respondent No. 1. It is further put forth that the
tractor belonging to the 1st respondent and insured with the
respondent No. 4 was used for digging up well by keeping the
blasting machine and, therefore, the causing of death by the use
of the tractor was established.
2. The tribunal, appreciating the materials brought on record,
came to hold that digging of the well with use of blasting machine
was carried on in the field of the owner and the tractor was used
for digging of the well with the blasting machine. Thereafter, it
proceeded to deal with fixing of the liability and the quantum of
the compensation. On the first aspect, it took note of the
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submission advanced on behalf of the insurer that the owner had
committed breach of the policy by using the tractor for
commercial use. To bolster the said stance, the insurer asserted
that the owner had not taken permission from the competent
authority for carrying on the blasting work in his field and,
hence, there was violation of the policy. On behalf of the owner,
the stand was taken that the tractor was used for agricultural
purposes, for digging of the well was carried on for the irrigation
of the crops which work was incidental to agriculture and hence,
there was no violation of the policy.
3. The tribunal came to hold that on the basis of the material
brought on record, the vehicle was used for commercial purpose
and, therefore, there was a fundamental breach of the insurance
policy. It further opined that the cause of the death of the
deceased was due to vehicular accident because of the evidence
brought on record. Emphasis was laid on the fundamental
breach of the insurance policy by the owner and, ultimately the
liability was fastened on him directing him and other respondent
to pay the compensation of Rs. 9,30,000/ with interest at the
rate of 6% per annum from the date of the petition till realization.
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4. Two appeals were preferred before the High Court
challenging the award of the tribunal. The High Court noted that
the power for trigger of the explosives came from the battery of
the tractor which was parked nearby and as explosion took
place, a large stone flew in air and fell on the head of the
deceased who was standing in front of a shop that was 300 ft.
away. It addressed to the concept of ‘use of motor vehicle’ and in
that context stated that the tractor, when it is stationary with the
additional implements/machines can be run using the power
generated by its engine for thrashing and cutting agriculture
produce. It also dwelt upon the concept that when a storage
battery of a vehicle is disconnected and taken for some other use,
sometimes it is used for other purposes without disconnecting
the battery from the vehicle. On the factual issue, the High
Court opined that the battery of the vehicle was still installed
inside and the terminals were used for providing power to the use
of explosive. However, it further went on to say that the battery
was practically detached from the vehicle and was not a part of
the vehicle and on that basis ruled that use of battery for causing
explosion cannot be said to be use of vehicle, for the vehicle was
not used for causing explosion. Eventually, it held that it could
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not be said that the accident that took place had arisen out of
the use of motor vehicle as defined in Section 165 of the Act and,
therefore, the claim petition under Section 166 was not
maintainable. Expressing the aforesaid view, the High Court set
aside the award passed by the tribunal.
5. We have heard Ms. Aparna Jha, learned counsel for the
appellants, Ms. Aishwarya Bhati, learned counsel for the
respondent No. 2 and Mr. Abhishek Kumar, learned counsel for
the respondent No. 4.
6. As is noticeable, the High Court has recorded a finding that
the battery was practically detached from the vehicle. The
correctness of this finding is required to be determined first. It is
necessary to note here that the tribunal has treated the accident
to be a vehicular accident and entertained the claim. As we find,
the High Court has not analyzed any evidence brought on record
to come to the conclusion that the battery of the vehicle was
practically detached from the vehicle and was not a part of the
vehicle. On the contrary, the Tribunal had noticed that the
panchnama of the tractor, Ex42, clearly showed that the tractor
was in the field and the blasting machine was found on tractor
with wrapped gas pipe and an explosive battery found on the
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tractor with the wooden cover. It has referred to Ex41 and other
oral evidence to record the finding that the blasting machine was
kept on the tractor driven by the driver engaged by the owner
and the tractor was used for digging of the well with the blasting
machine. The insurer, as is evident, had only raised a singular
plea with regard to use of the tractor, namely, ‘commercial
purpose’ and on that foundation, it had advanced the stance that
there had been fundamental breach of the insurance policy.
Keeping in view the evidence on record, we agree with the view
expressed by the tribunal that the battery was still installed on
the vehicle and the power was drawn from the battery for
explosive purposes. Having arrived at the aforesaid conclusion,
we shall proceed to deal with the concept of ‘use’ and determine
whether the accident could be regarded as a vehicle accident.
7. Section 165 deals with the claims tribunals. It uses the
word ‘use of motor vehicles’. For the sake of completeness, we
reproduce the relevant part of the said provision:
“Section 165. Claims Tribunals.—
(1) A State Government may, by notification in the
Official Gazette, constitute one or more Motor
Accidents Claims Tribunals (hereafter in this
Chapter referred to as Claims Tribunal) for such
area as may be specified in the notification for the
purpose of adjudicating upon claims for
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compensation in respect of accidents involving the
death of, or bodily injury to, persons arising out of
the use of motor vehicles, or damages to any
property of a third party so arising, or both…..”
The aforesaid provision makes it vivid that the tribunal can
adjudicate the claims for compensation in respect of accidents
arising out of use of motor vehicles. Thus, the fundamental
requirement is that the accident should arise out of the use of
the motor vehicle. If there is no use of the motor vehicle, the
question of vehicular accident will not arise.
8. In this context, reference to certain definitions, as stated in
the dictionary clause would be apt. Section 2(28) defines ‘motor
vehicle’ or ‘vehicle’. It reads as follows:
“(28) “motor vehicle” or “vehicle” means any
mechanically propelled vehicle adapted for use upon
roads whether the power of propulsion is
transmitted thereto from an external or internal
source and includes a chassis to which a body has
not been attached and a trailer; but does not
include a vehicle running upon fixed rails or a
vehicle of a special type adapted for use only in a
factory or in any other enclosed premises or a
vehicle having less than four wheels fitted with
engine capacity of not exceeding twentyfive cubic
centimeters;”
Section 2(44) defines ‘tractor’ to mean a motor vehicle which
is not itself constructed to carry any load (other than equipment
used for the purpose of propulsion); but excludes a roadroller.
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9. Keeping the aforesaid definitions in view, we are required to
analyze whether the use of the vehicle in the manner in which it
is done can be treated as use of the vehicle to cause a vehicular
accident. This Court in Shivaji Dayanu Patil and another v.
Smt. Vatschala Uttam More1 was dealing with conceptual
meaning of the phrase “arising out of the use of motor vehicle”
as contained in Section 92A of the Motor Vehicles Act, 1939
(hereinafter referred to as ‘the 1939 Act’). We may note with profit
that Section 92A(1) used the words “an accident arising out of
the use of a motor vehicle” and Section 165 of the Act that has
been reproduced hereinabove also uses the words “arising out of
the use of motor vehicles”. Thus, there has been no change in
this part of the provision.
10. In Patil’s case, there was a collision between a petrol tanker
and a tractor on the national highway as a result of which, the
petrol tanker went off the road and fell on its left side as a result
of its turning turtle, the petrol contained in it leaked out and
collected nearby. The accident took place at about 3 a.m. and at
about 7.15 a.m. an explosion took place in the said petrol tanker
resulting in fire and the persons who had assembled near the
1 (1991) 3 SCC 530
9
tanker sustained injuries and one of them succumbed to the
injuries. On a claim petition being filed, the tribunal dismissed
the same on the ground that the explosion could not be said to
be an accident arising out of the use of the petrol tanker and that
the provision of Section 92A of the 1939 Act were not attracted.
It expressed the view that the accident that took place at 7.15
a.m. was an independent explosion. On appeal, the learned single
Judge of the High Court held that though at the material time the
tanker was not being driven on the highway and was lying turtle
on its side on the highway but it would be covered by the
expression ‘use’ as contemplated in Section 92A of the 1939 Act.
In Letters Patent Appeal, the Division Bench opined that the
expression ‘use’ of motor vehicle covers a very wide field, a field
more extensive than which might be called traffic use of the
motor vehicle and that the use of a vehicle is not confined to the
periods when it was in motion or was moving and that a vehicle
would still be in use even when it was stationary. It had also
expressed the view that it could not be inferred that there was no
causal relation between the earlier event and the later incident of
explosion and fire and further, the earlier collision if not the
cause, was at least the main contributory factor for the
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subsequent explosion. Being of this view, the Division Bench
affirmed the judgment of the learned single Judge.
11. This Court referred to the Statement of Objects and Reasons
for introduction of Section 92A to Section 92E of the Motor
Vehicles (Amendment) Act, 1982. Analyzing, Chapter VIIA of the
1939 Act which was amended by Act 47 of 1982 dealt with
“Liability without fault in certain cases”, the Court referred to
the anatomy of Section 92A, the purpose behind it, the concept
of beneficial legislation and proceeded to interpret the words
‘arising out of the use of motor vehicle’. Be it noted, on behalf of
the petitioners therein, a contention was raised that the tanker
had ceased to be a mechanically propelled vehicle. The Court
relied on the decision in Newberry v. Simmonds2 wherein it was
held that the motor car does not cease to be a mechanically
propelled vehicle upon the mere removal of the engine if the
evidence admits the possibility that engine may shortly be
replaced and the moving power restored. The Court further
referred to the authority in Smart v. Allan3 where the defendant
had brought a car for £ 2 and subsequently sold it as scrap for
30 cents. It was found that the engine was in a rusty condition
2 [1961] 2 ALL ER 318
3 [1962] 3 ALL ER 893
11
and was incomplete and it did not work, and there was no gear
box or electric batteries; and the car was incapable of moving
under its own power, having been towed from place to place and
that it could only have been put in running order again by
supplying a considerable number of spare parts and effecting
considerable repairs, the cost of which would have been out of all
proportion to its value. It was contended before the House of
Lords that every vehicle which starts its life as a mechanically
propelled vehicle remains as such until it is physically destroyed.
The said submission was rejected by Lord Parker, CJ who
observed thus:
“… it seems to me as a matter of common sense
that some limit must be put, and some stage must
be reached, when one can say: ‘This is so immobile
that it has ceased to be a mechanically propelled
vehicle’. Where, as in the present case, and unlike
Newberry v. Simmonds, there is no reasonable
prospect of the vehicle ever being made mobile
again, it seems to me that, at any rate at that stage,
a vehicle has ceased to be a mechanically propelled
vehicle.”
This Court agreed with the aforesaid formulation and
reasoning and came to hold that the petrol tanker had not ceased
to be a motor vehicle.
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12. The twoJudge Bench thereafter proceeded to interpret the
expression ‘use of the motor vehicle’, for it was urged that a
vehicular accident could only take place when the vehicle is
mobile.
13. Learned counsel for the petitioner therein urged for placing
a narrow meaning on the word ‘use’ by confining it to a situation
only when the vehicle is mobile. On behalf of the respondent, it
was suggested that a wider connotation for the word ‘use’ should
be taken so as to include the period when the vehicle is
stationary. On behalf of the respondents, observations made in
Elliott v. Grey4, Government Insurance Office of New South
Wales v. R.J. Green & Lloyd Pty. Ltd.5, Pushpa Rani Chopra
v. Anokha Singh6, General Manager, K.S.R.T.C. v. S.
Satalingappa7 and Oriental Fire and General Insurance Co.
Ltd. v. Suman Navnath Rajguru8 were pressed into service. The
Court, after referring to the decisions cited by the respondent and
the analysis made by the High Court, opined:
“26. …In our opinion, the word “use” has a wider
connotation to cover the period when the vehicle is
not moving and is stationary and the use of a
vehicle does not cease on account of the vehicle
4 [1960] 1 QB 367 : [1959] 3 All ER 733
5 (1965) 114 CLR 437
6 1975 ACJ 396 (Del HC)
7 1979 ACJ 452 (Kant HC)
8 1985 ACJ 243 (Bom HC)
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having been rendered immobile on account of a
breakdown or mechanical defect or accident. In the
circumstances, it cannot be said that the petrol
tanker was not in the use at the time when it was
lying on its side after the collision with the truck.”
14. After so holding, the Court proceeded to consider whether
explosion and fire which caused injuries to the insured and
eventual death of one could be said to have taken place due to an
accident arising out of the use of the motor vehicle, i.e., the petrol
tanker. In that context, the question of causal relationship
between the user of the motor vehicle and the accident which has
resulted in death or disablement arose. Be it stated, the stand of
the petitioner that the deceased and the injured persons were
engaged in pilferage of petrol and the explosion of fire took place
because of the unlawful activities was negatived as the finding
recorded by the tribunal on the said score had been overturned
by the learned Single Judge whose view had been approved by
the appellate Bench of the High Court.
15. The Court referred to Heyman v. Darwins Ltd.9, Union of
India v. E.B. Aaby’s Rederi A/S10 and Samick Lines Co. Ltd.
v. Owners of the Antonis P. Lemos 11 and thereafter adverted to
9 [1942] AC 356 : [1942] 1 All ER 337
10 [1975] AC 797 : [1974] 2 All ER 874
11 [1985] 2 WLR 468
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the decision of the High Court of Australia in R.J. Green Case
wherein Lord Barwick, C.J. has stated:
“Bearing in mind the general purpose of the Act I
think the expression ‘arising out of’ must be taken
to require a less proximate relationship of the
injury to the relevant use of the vehicle than is
required to satisfy the words ‘caused by’. It may be
that an association of the injury with the use of the
vehicle while it cannot be said that that use was
causally related to the injury may yet be enough to
satisfy the expression ‘arise out of’ as used in the
Act and in the policy.”
The observation of Windeyer, J. that was reproduced by the
Court is to the following effect:
“The words ‘injury caused by or arising out of the
use of the vehicle’ postulate a causal relationship
between the use of the vehicle and the injury.
‘Caused by’ connotes a ‘direct’ or ‘proximate’
relationship of cause and effect. ‘Arising out of’
extends this to a result that is less immediate; but it
still carries a sense of consequence.”
16. The twoJudge Bench, appreciating the wider connotation,
proceeded to lay down:
“36. This would show that as compared to the
expression “caused by”, the expression “arising out
of” has a wider connotation. The expression “caused
by” was used in Sections 95(1)(b)(i) and (ii) and 96(2)
(b)(ii) of the Act. In Section 92A, Parliament,
however, chose to use the expression “arising out
of” which indicates that for the purpose of awarding
compensation under Section 92A, the causal
relationship between the use of the motor vehicle
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and the accident resulting in death or permanent
disablement is not required to be direct and
proximate and it can be less immediate. This would
imply that accident should be connected with the
use of the motor vehicle but the said connection
need not be direct and immediate. This construction
of the expression “arising out of the use of a motor
vehicle” in Section 92A enlarges the field of
protection made available to the victims of an
accident and is in consonance with the beneficial
object underlying the enactment.”
17. Thereafter, the Division Bench posed the question, whether
the accident involving explosion and fire in the petrol tanker was
connected with the use of tanker as a motor vehicle. Concurring
with the view of the High Court, it ruled:
“37. …In our view, in the facts and circumstances of
the present case, this question must be answered in
the affirmative. The High Court has found that the
tanker in question was carrying petrol which is a
highly combustible and volatile material and after
the collision with the other motor vehicle the tanker
had fallen on one of its sides on the sloping ground
resulting in escape of highly inflammable petrol and
that there was grave risk of explosion and fire from
the petrol coming out of the tanker. In the light of
the aforesaid circumstances the learned Judges of
the High Court have rightly concluded that the
collision between the tanker and the other vehicle
which had occurred earlier and the escape of petrol
from the tanker which ultimately resulted in the
explosion and fire were not unconnected but related
events and merely because there was interval of
about four to four and half hours between the said
collision and the explosion and fire in the tanker, it
cannot be necessarily inferred that there was no
causal relation between explosion and fire. In the
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circumstances, it must be held that the explosion
and fire resulting in the injuries which led to the
death of Deepak Uttam More was due to an accident
arising out of the use of the motor vehicle viz. the
petrol tanker No. MKL 7461.”
[Emphasis supplied]
The aforesaid analysis throws immense light to understand
the concept of “related events” and “causal relation”. They have
been distinguished from an event which is not connected.
Needless to say, the appreciation of causal relation is a question
of fact in each case and is to be weighed and appreciated on the
basis of the materials brought on record.
18. In Union of India v. United India Insurance Co. Ltd. and
others12, a twoJudge Bench has opined that the words ‘use of
the motor vehicle’ is to be construed in a wider manner. The
learned Judges referred to the decision in Patil’s case wherein
reference was made to the Australian case in R.J. Green (supra)
and to the observations of Lord Barwick, C.J. that those words
have to be widely construed. The Court, in the latter case,
referred to the observations of Windeyer, J. in R.J. Green’s case
which read thus:
“… no sound reason was given for restricting the
phrase, ‘the use of a motor vehicle’ in this way. The
12 (1997) 8 SCC 683
17
only limitation upon it … that I can see is that the
injury must be one in any way a consequence of a
use of the vehicles as a motor vehicle.”
The aforesaid passage emphasizes on “consequence of a
use”. It is equated with a “related event”.
19. The aforesaid view has been reiterated in Samir Chanda v.
Managing Director, Assam State Transport Corporation13. In
the said case, a bomb exploded inside the bus as a result of
which the appellant sustained serious injuries on his legs. The
tribunal passed an award in favour of the claimant. In appeal
preferred by the respondent, the High Court, while not disturbing
the finding of the tribunal on facts, expressed the view that there
was no negligence on the part of the owner or the driver of the
vehicle and, therefore, the question of paying compensation did
not arise. This Court referred to Patil’s case and placing reliance
on the same, opined:
“14. … The explosion took place inside the bus is an
admitted fact and the usual police escort was not
there. The High Court, except observing that there
was no negligence, has not upset the finding of the
Tribunal that the atmosphere during the period of
accident was so polluted requiring care on the part
of the conductor and the driver of the bus. There
cannot be any doubt that the accident arose out of
13 (1998) 6 SCC 605
18
the use of the motor vehicle justifying the claim of
the appellant.”
20. The decision in United India Insurance Co. Ltd. (supra)
has ruled that if it is ultimately found that there is no negligence
on the part of the driver of the vehicle or there is no defect in the
vehicle but the accident is only due to the sole negligence of the
other parties/agencies, then on that finding, the claim would go
out of Section 110(1) of the 1939 Act because the case would
then become one of exclusive negligence of the Railways. Again if
the accident had arisen only on account of the negligence of
persons other than the driver/owner of the motor vehicle, the
claim would not be maintainable before the tribunal.
21. The said opinion has been overruled by a threeJudge
Bench decision in Union of India v. Bhagwati Prasad (Dead)
and others14. We have placed reliance on the Division Bench
judgment, as we are really not concerned about the overruled
part. However, we may note with profit that Bhagwati Prasad’s
case expands the horizon of the jurisdiction of the Motor
Accidents Claims Tribunal by stating that a combined reading of
Sections 110 and 110A, which deal with the constitution of one
14 (2002) 3 SCC 661
19
or more Motor Accidents Claims Tribunals and application for
compensation arising out of an accident, as specified in sub
section (1) of Section 110 unequivocally indicates that the Claims
Tribunal would have the jurisdiction to entertain application for
compensation both by the persons injured or legal
representatives of the deceased when the accident arose out of
the use of a motor vehicle. The crucial expression conferring
jurisdiction upon the Claims Tribunal constituted under the
Motor Vehicles Act is the accident arising out of the use of a
motor vehicle and, therefore, if there has been a collision between
the motor vehicle and railway train then all those persons injured
or legal representatives of the deceased could make application
for compensation before the Claims Tribunal not only against the
owner, driver or insurer of the motor vehicle but also against the
Railway Administration. Once such an application is held to be
maintainable and the tribunal entertains such an application, if
in course of enquiry the tribunal comes to a finding that it is the
other joint tortfeasor connected with the accident who was
responsible and not the owner or driver of the motor vehicle then
the tribunal cannot be held to be denuded of its jurisdiction
which it had initially. In other words, in such a case also tribunal
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would be entitled to award compensation against the other joint
tortfeasor.
22. From the aforesaid authorities, it is limpid that the
expression ‘use of the vehicle’ under certain circumstances can
be attracted when the vehicle is stationary or static. A Division
Bench of the High Court of Orissa in Kanhei Rana and another
v. Gangadhar Swain and others15 while dealing with a
situation where the deceased labourer after loading the truck
with logs lost his life. The tribunal had categorically found that
death was on the account of fall of a log, when the truck was
being loaded with logs. The learned Single Judge, in appeal, had
concurred with the view of the tribunal by opining that the fall of
the log had no nexus with the use of the vehicle not even
remotely, and there was no material to show that the fall of the
log was occasioned due to use of the vehicle. He had further held
that the careless handling of goods being loaded on or unloaded
from a vehicle had no connection to the vehicle itself. Reversing
the conclusion of the learned single Judge, the Division Bench
opined that the concept of movement being not intrinsically or
inherently connected with the use and the term ‘use’ having been
15 AIR 1993 ORI 89
21
connotatively expanded, there can be no doubt that the same can
also be extended to the arena/sphere of a claim advanced under
Section 110 of the 1939 Act. Heavy onus is cast on the driver to
avoid negligence while the vehicle is in use. If the term ‘use’ in its
conceptual sweep engulfs no motion or no movement or
stationariness, then by logical corollary it is made essential that
the driver or for that matter any agent of the owner should be
careful and nonnegligent. Negligence in driving is regarded as a
fact that the vehicle is in motion. But the definition of ‘use’
having been expanded in its broader canvas, it has to clothe in
its sweep other categories of negligence. To elaborate, when a
vehicle remains static, it cannot constitute that the driver is
negligent because of his rash and negligent driving. On the
contrary, it has to embody some other different types of
negligence. Of course that would depend upon the facts and
circumstances of each case. The Division Bench of the High
Court went on to say that the apex Court in Patil (supra)
was dealing with the negligence so far as it was concerned with
Section 92 of the Act, but as the language of Section 92A and
Section 110 of the old Act used the same phraseology and there
is absence of any etymological distinction, the same
22
meaning should be given to the expression under Section 110 of
the old Act. The appellate Bench held that
there was causal relationship with the accident which had
resulted in the death of the claimant.
23. We entirely agree with the aforesaid analysis, for it is in
accord with the view of the decisions of this Court.
24. It may be reiterated here that the causal relationship should
exist between violation and the accident caused. There has to be
some act done by the person concerned in causing the accident.
The commission or omission must have some nexus with the
accident. The word ‘use’ as has been explained by the authorities
of this Court need not have an intimate and direct nexus with the
accident. The Court has to bear in mind that the phraseology
used by the legislature is “accident arising out of use of the motor
vehicle”. The scope has been enlarged by such use of the
phraseology and this Court taking note of the beneficial provision
has placed a wider meaning on the same. There has to be some
causal relation or the incident must relate to it. It should not be
totally unconnected. Therefore, in each case what is required to
be seen is whether there has been some causal relation or the
event is related to the act.
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25. Presently, we shall scrutinse the factual score in the case at
hand. As is evincible, the battery was installed in the tractor and
the explosives were charged by the battery. The purpose was to
dig the well in the field. In such an obtaining factual matrix, it
would be an erroneous perception to say that the vehicle was not
in use as stipulated under Section 165 of the Act. Hence, we have
no hesitation in holding that the Division Bench has fallen into
error on the said score.
26. Having said that, we have to presently analyse on whom the
liability should be mulcted. As is evident, the insurer has
advanced the plea that the tractor was insured under “Farmer
Package Policy” for agriculture purpose by the owner of the
vehicle. However, it was used for commercial purpose by
mounting a blasting machine thereon. That use was in breach of
insurance policy and, therefore, the insurer was not liable to pay
the compensation. The insurer also examined its employee,
namely, Mr. Chararkar to establish the fact that the owner of the
vehicle had committed breach of insurance policy by using it for
commercial purpose and for transporting the blasting machine.
The tribunal has adverted to the plea of the insured that the
vehicle was used for digging of the well in the field of respondent
24
No. 1 (Fimidabee w/o Abdul Gaffar) which obviously was for
irrigation and incidental to agricultural activity and not in breach
of the insurance policy. The rival contention in this behalf has
been considered by the tribunal in the following words:
“29. The Respondent No.2 has admitted the fact
that Insurance Policy of offending tractor was for
the agricultural purpose. The insurance of
offending tractor was taken at Jaipur, Rajasthan. It
was brought for commercial activity namely the
blasting work. The blasting machine was found on
the tractor. No permission from Competent
Authority was taken for the blasting work and
therefore, the Respondent No.2 has used tractor for
commercial purpose and consequently there was
fundamental breach of the Insurance Policy. The
Respondent No.2 committed fundamental breach of
the Insurance Policy allowing the use of tractor for
commercial purpose and therefore, the decision
cited supra is inapplicable.”
And again in paragraphs 35, 36 and 37, the tribunal has
observed:
“35. The Respondent No. 1 has come with the case
that digging work with blasting operation was given
with sole responsibility of Respondent Nos. 2 and 3.
The Respondent Nos. 2 and 3 have come with the
case that blasting work for digging of well was taken
at the risk of Respondent No.1 to 3 have not
produced documentary evidence showing that
digging work of well with blasting operation was
being done on the sole responsibility either of
Respondent No.1 or of the respondent Nos. 2 and 3.
In absence of such evidence, the Respondent Nos. 1
to 3 are jointly and severally liable to pay
compensation.
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36. It was submitted on behalf of Respondent No.4
that Respondent No.2 committed fundamental
breach of Instruction Policy by using the tractor for
commercial purpose and therefore, Respondent
No.4 cannot be directed to make the payment to
petitioners and recover the same from the owner of
offending tractor.
xxx xxx xxx
37. The Respondent No.2 allowed the use of
offending tractor for doing the blasting work and
therefore there was fundamental breach of the
Insurance Policy. Since there was fundamental
breach of the Insurance Policy for using the
offending tractor for commercial purpose and
consequently, Respondent No. 4 is not liable to pay
the compensation and directed to pay the same and
recover the same from Respondent No. 2 owner of
offending tractor.
xxx xxx xxx”
The High Court, however, has not analysed this issue at all,
for it took the view that as the vehicle was not used for causing
explosion, it could not be said that the accident had arisen out of
use of motor vehicle as defined under Section 165 of the Act.
27. From the factual position as already analysed earlier, it is
noticed that the battery of the tractor was used for digging of well
in a field used for agricultural purpose. The insured had
contended that the work of digging of well in a field used for
agricultural purpose would embrace an activity associated with
agriculture for irrigating the field and we have answered the same
in the affirmative. We may immediately state that our answer
26
does not help in fastening the liability because there has been no
analysis as regards the terms and conditions of the policy and its
fundamental character. The High Court, as we notice, has not
dealt with any of these matters, the adjudication whereof has
now become inevitable to answer the issue about the liability to
be borne by the insurer, the owner of the vehicle (insured) or
otherwise. This adjudication requires analysis of relevant
material including the insurance policy and evidence of
concerned witnesses, for understanding the terms and conditions
of the policy regard being had to nature of policy and the extent
of the liability of the insurer, if any. As the High Court has not
considered this aspect at all, we deem it appropriate to relegate
the parties to the High Court for determining the singular issue
about fastening of the liability on the insurer or the owner of the
vehicle. Under these circumstances, we are of the considered
opinion that until that issue is finally decided, the insurance
company must pay the compensation amount payable to the
claimants as determined by the tribunal in terms of the award
dated 5th January, 2008, which payment will be subject to the
outcome of the remanded appeals to be decided by the High
Court. Needless to state that the claimants need not contest the
27
remanded proceedings before the High Court as it is remitted
only for limited purpose to determine the liability amongst the
insurer (United India Assurance Co. Ltd.) and owner of the
vehicle, Kanhaiyalal.
28. In view of the aforesaid analysis, we partly allow both the
appeals, set aside the judgment of the High Court dated 10 th
October, 2013 in First Appeal Nos. 494 of 2013 and 437 of 2008
and restore both the First Appeals to the file of the High Court to
their original numbers for being decided on the question as to
who should be made liable to pay the compensation amount as
determined by the tribunal to be paid to the claimants. We
request the High Court to decide the First Appeals expeditiously,
with reference to the limited issue of liability to pay
compensation. In terms of this order, the insurance company is
directed to deposit the compensation amount before the tribunal
within eight weeks hence, which will be without prejudice to the
rights and contentions of the insurance company in the
remanded First Appeals. In the event the insurance company
succeeds, it will have the right to recover the same with interest
accrued thereon from the owner of the vehicle. The amount
deposited by the insurance company shall be disbursed by the
28
tribunal keeping in view the law laid down in General Manager,
Kerala State Road Transport Corporation, Trivandrum v.
Susamma Thomas and others16.
29. In the facts and circumstances of the case, there shall be no
order as to costs.
……………………………CJI.
(Dipak Misra)
………………………………J.
(A.M. Khanwilkar)
………………………………J.
(Dr. D.Y. Chandrachud)
New Delhi;
03 July, 2018
16 (1994) 2 SCC 176
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