SUPREME COURT OF INDIA
Oriental Insurance Company Limited
Vs
Brij Mohan and Others
(S. B. Sinha and Markandeya Katju, JJ)
15.05.2007
JUDGMENT
S. B. SINHA, J.
1. Leave granted.
2. Appellant Insurance Company is before us being aggrieved by and dissatisfied
with the judgment and order dated 27.1.2004 passed by a Division Bench of the
High Court of Rajasthan dismissing an appeal from the judgment and award dated
7.4.1999 passed by Motor Accident Claims Tribunal, Baran in the State of
Rajasthan.
3. First Respondent Brij Mohan filed the claim petition. He was a labourer. On
or about 11.3.1998 he was travelling on a trolley attached to a tractor. There
exists a dispute as to whether both the tractor and the trolley were insured or
not. It may not be necessary to determine the said question. He was engaged to
dig earth from a place known as Shishwali Ka Rasta. The earth so dug was loaded
on the trolley attached to the tractor. Respondent and other workers were
returning to the Bhatta (brick-klin). He was sitting on the earth loaded on the
trolley. The tractor allegedly was being driven rashly and negligently by
Hemraj, the driver. He slipped down from the trolley, came under the wheels thereof
injuring his gall-bladder and left thigh, as a result whereof he suffered
grievous injuries.
4. The learned Tribunal noticed the defence raised by the appellant herein in
the said proceedings which, inter alia, were:
(i) The trolley was not insured, and only the tractor was insured;
(ii) As the tractor was not being used for agricultural work, the claim
petition was not maintainable.
(iii) Issuance of premium having been paid only for one person, namely, the
driver of the tractor; no award could be passed against the insurer.
5. The Tribunal, however, by reason of its award, awarded a sum of Rs. 1, 96,
100/- by way of compensation in favour of the respondent in respect of the
injuries suffered by him as a result of the said accident. An appeal, preferred
thereagainst, as noticed hereinbefore, has been dismissed by the High Court by
reason of the impugned judgment.
6. Mr. M.K. Dua, learned counsel appearing on behalf of the appellant submitted
that the Tribunal as also the High Court committed manifest errors in passing
the impugned Award and judgment insofar as they failed to take into
consideration :
(i) The tractor alone was insured and thus the claim petition was not
maintainable.
(ii) In any event, Respondent no.1 was merely a gratuitous passenger and thus
the claim was not covered under Section 147 of the Motor
Vehicles Act, 1988.
(iii) The tractor having not been used for agricultural purpose there had been
a violation of the conditions of contract of insurance.
7. Ms. Indu Malhotra, learned counsel appearing on behalf of the respondent, on the other hand, submitted :
(i). the question as to whether both the tractor and the trolley were insured
or not having not been raised before the Tribunal, this Court should not permit
the appellant to raise the said contention before this Court.
(ii) The representative of the appellant in his statement before the Court
admitted that putting the earth and leveling the field would also be an agricultural
work and thus it cannot now be contended that the tractor was not being used
for the said purpose.
(iii) In any event, having regard to the grievous injuries suffered by the
respondent, this Court should direct the appellant to pay the awarded amount
and recover the same from the owner of the tractor and trolley.
8. The Tribunal in its award has, inter alia, noticed that the appellant herein
had raised a specific defence, namely, the trolley was not insured. It does not
appear that the said contention of the appellant had been gone into. There is
nothing on records to show that the owner of the tractor had produced any
insurance cover in respect of the trolley. It is furthermore not disputed that
the tractor was insured only for the purpose of carrying out agricultural
works. The representative of the Insurance Company Mr. Hari Singh Meena on
cross-examination merely accepted the suggestion that cutting the earth and
levelling the field with earth would be an agricultural work but respondent no.1
himself categorically stated in his claim petition before the Tribunal stating
that the earth had been dug and was being carried in the trolley to the
brick-klin. Evidently the earth was meant to be used only for the purpose of
manufacturing bricks. Digging of earth for the purpose of manufacture of
brick-klin indisputably cannot amount to carrying out of the agricultural work.
9. In National Insurance Co. Ltd. v. V. Chinnamma & Ors. Â , this
Court held :-
"14. An insurance for an owner of the goods or his authorised
representative travelling in a vehicle became compulsory only with effect from
14-11-1994 i.e. from the date of coming into force of amending Act 54 of 1994.
15. Furthermore, a tractor is not even a "goods carriage". The
expression goods carriage has been defined in Section 2(14) to mean
"any motor vehicle constructed or adapted for use solely for the carriage
of goods, or any motor vehicle not so constructed or adapted when used for the
carriage of goods" (emphasis supplied)
Whereas "tractor" has been defined in Section 2(44) 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".
"Trailer" has been defined in Section 2(46) to mean "any
vehicle, other than a semi-trailer and a sidecar, drawn or intended to be drawn
by a motor vehicle". 16. A tractor fitted with a trailer may or may not
answer the definition of goods carriage contained in Section 2(14) of the Motor
Vehicles Act. The tractor was meant to be used for agricultural purposes. The
trailer attached to the tractor, thus, necessarily is required to be used for
agricultural purposes, unless registered otherwise. It may be, as has been
contended by Mrs K. Sharda Devi, that carriage of vegetables being agricultural
produce would lead to an inference that the tractor was being used for
agricultural purposes but the same by itself would not be construed to mean
that the tractor and trailer can be used for carriage of goods by another person
for his business activities. The deceased was a businessman. He used to deal in
vegetables. After he purchased the vegetables, he was to transport the same to
the market for the purpose of sale thereof and not for any agricultural
purpose. The tractor and trailer, therefore, were not being used for
agricultural purposes. However, even if it be assumed that the trailer would
answer the description of "goods carriage" as contained in Section
2(14) of the Motor Vehicles Act, the case would be covered by the decisions of
this Court in Asha Rani1 and other decisions following the same, as the
accident had taken place on 24-11-1991 i.e. much prior to coming into force of
the 1994 amendment."
10. Furthermore, respondent was not the owner of the tractor. He was also not
the driver thereof. He was merely a passenger travelling on the trolley
attached to the tractor. His claim petition, therefore, could not have been
allowed in view of the decision of this Court in New India Assurance Co. Ltd.
v. Asha Rani & Ors. Â 0 wherein the
earlier decision of this Court in New India Assurance Co. v. Satpal Singh
 was overruled. In Asha Rani (supra) it was, inter alia, held:-
"25. Section 147 of the 1988 Act, inter alia, prescribes compulsory
coverage against the death of or bodily injury to any passenger of "public
service vehicle". Proviso appended thereto categorically states that
compulsory coverage in respect of drivers and conductors of public service
vehicle and employees carried in a goods vehicle would be limited to the
liability under the Workmens Compensation Act. It does not speak of any
passenger in a "goods carriage".
26. In view of the changes in the relevant provisions in the 1988 Act vis-'-vis
the 1939 Act, we are of the opinion that the meaning of the words "any
person" must also be attributed having regard to the context in which they
have been used i.e. "a third party". Keeping in view the provisions
of the 1988 Act, we are of the opinion that as the provisions thereof do not
enjoin any statutory liability on the owner of a vehicle to get his vehicle
insured for any passenger travelling in a goods vehicle, the insurers would not
be liable therefore.
27. Furthermore, sub-clause (i) of clause (b) of sub- section (1) of Section
147 speaks of liability which may be incurred by the owner of a vehicle in
respect of death of or bodily injury to any person or damage to any property of
a third party caused by or arising out of the use of the vehicle in a public
place, whereas sub-clause (ii) thereof deals with liability which may be
incurred by the owner of a vehicle against the death of or bodily injury to any
passenger of a public service vehicle caused by or arising out of the use of
the vehicle in a public place."
[See also National Insurance Co. Ltd. v. Bommithi Subbhayamma and Others
 2005 (12) SCC 243 and United India Insurance Co. Ltd., Shimla v. Tilak
Singh and Ors. Â.
11. Although the effect in 1994 amendment in the Motor Vehicles Act did not
call for consideration in Asha Rani (supra), a 3 Judge Bench of this Court had
the occasion to consider the said question in National Insurance Co. Ltd. Vs.
Baljit Kaur & Ors. Â in the following terms :
"17. By reason of the 1994 amendment what was added is
"including" owner of the goods or his authorised representative
carried in the vehicle. The liability of the owner of the vehicle to insure it
compulsorily, thus, by reason of the aforementioned amendment included only the
owner of the goods or his authorised representative carried in the vehicle
besides the third parties. The intention of Parliament, therefore, could not
have been that the words any person occurring in Section 147 would cover all
persons who were travelling in a goods carriage in any capacity whatsoever. If
such was the intention, there was no necessity of Parliament to carry out an
amendment inasmuch as the expression any person contained in sub-clause (i) of
clause (b) of sub-section (1) of Section 147 would have included the owner of
the goods or his authorised representative besides the passengers who are
gratuitous or otherwise.
Appeal (Civil) 2532 of 2007
(18. The Observations Made In This Connection By The Court In Asha Rani Case2 To Which One Of Us, Sinha, J., Was A Party, However, Bear Repetition: (SCC P. 235, Para 26), JJ)
26. In view of the changes in the relevant provisions in the 1988 Act vis-'-vis
the 1939 Act, we are of the opinion that the meaning of the words any person
must also be attributed having regard to the context in which they have been
used i.e. a third party. Keeping in view the provisions of the 1988 Act, we are
of the opinion that as the provisions thereof do not enjoin any statutory
liability on the owner of a vehicle to get his vehicle insured for any
passenger travelling in a goods vehicle, the insurers would not be liable
therefore.
19. In Asha Rani2 it has been noticed that sub-clause (i) of clause (b) of
sub-section (1) of Section 147 of the 1988 Act speaks of liability which may be
incurred by the owner of a vehicle in respect of death of or bodily injury to
any person or damage to any property of a third party caused by or arising out
of the use of the vehicle in a public place. Furthermore, an owner of a
passenger- carrying vehicle must pay premium for covering the risks of the
passengers travelling in the vehicle. The premium in view of the 1994 amendment
would only cover a third party as also the owner of the goods or his authorised
representative and not any passenger carried in a goods vehicle whether for
hire or reward or otherwise.
12. Interpretation of the contracts of insurance in terms of Section 147 and
149 of the Motor Vehicles Act came up for consideration recently before a
Division Bench of this Court in National Insurance Co. Ltd. v. Laxmi Narain
Dhut  2007 (4) Scale 36, wherein it was held :-
"24. As noted above, there is no contractual relation between the third
party and the insurer. Because of the statutory intervention in terms of
Section 149, the same becomes operative in essence and Section 149 provides
complete insulation.
25. In the background of the statutory provisions, one thing is crystal clear
i.e. the statute is beneficial one qua the third party. But that benefit cannot
be extended to the owner of the offending vehicle. The logic of fake licence
has to be considered differently in respect of third party and in respect of
own damage claims."
It was further observed:
"36. It is also well settled that to arrive at the intention of the
legislation depending on the objects for which the enactment is made, the Court
can resort to historical, contextual and purposive interpretation leaving
textual interpretation aside.
37. Francis Bennion in his book "Statutory Interpretation" described
"purposive interpretation" as under:
'A purposive construction of an enactment is one which gives effect to the
legislative purpose by-
(a) Following the literal meaning of the enactment where that meaning is in
accordance with the legislative purpose, or
(b) Applying a strained meaning where the literal meaning is not in accordance with
the legislative purpose.'
38. More often than not, literal interpretation of a statute or a provision of
a statute results in absurdity. Therefore, while interpreting statutory
provisions, the Courts should keep in mind the objectives or purpose for which
statute has been enacted. Justice Frankfurter of U.S. Supreme Court in an
article titled as Some Reflections on the Reading of Statutes (47 Columbia Law
Reports 527), observed that, "legislation has an aim, it seeks to obviate
some mischief, to supply an adequacy, to effect a change of policy, to
formulate a plan of Government. That aim, that policy is not drawn, like
nitrogen, out of the air; it is evidenced in the language of the statutes, as
read in the light of other external manifestations of purpose."
[See also The Oriental Insurance Company Ltd. v. Meena Variyal Ors. Â 2007
(5) Scale 269
13. However, respondent no.1 is a poor labourer. He had suffered grievous
injuries. He had become disabled to a great extent. The amount of compensation
awarded in his favour appears to be on a lower side. In the
aforementioned situation, although we reject the other contentions of Ms. Indu
Malhotra, we are inclined to exercise our extraordinary jurisdiction under
Article 142 of the Constitution Of India, 1950 so as
to direct that the award may be satisfied by the appellant but it would be
entitled to realize the same from the owner of the tractor and the trolley
wherefore it would not be necessary for it to initiate any separate proceedings
for recovery of the amount as provided for under the Motor Vehicles Act.
14. It is well settled that in a situation of this nature this Court in
exercise of its jurisdiction under Article 142 of the Constitution
Of India, 1950 read with Article 136 thereof can issue suit directions
for doing complete justice to the parties.
15. In National Insurance Company Ltd. v. Kusum Rai & Others  , this
Court observed :
"19. Thus, although we are of the opinion that the appellant was not
liable to pay the claimed amount as the driver was not possessing a valid
licence and the High Court was in error in holding otherwise, we decline to
interfere with the impugned award, in the peculiar facts and circumstances of
the case, in exercise of our jurisdiction under Article 136 of the Constitution
but we direct that the appellant may recover the amount from the owner in the
same manner as was directed in Nanjappan."
16. This appeal is allowed with the aforementioned directions. There shall,
however, be no order as to costs.