TaxTMI 
TaxTMI 
1981 (9) TMI 302
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....ompensating those who receive injuries or die in road or train accidents. The victims of road accidents or their dependents are driven to wage a long and unequal battle against the Insurance Companies, which deny their liability on every conceivable ground and indulge in an ingenious variety of factual disputations from 'who was driving the vehicle' to 'whose negligence was the sine qua non of the accident'. The delay in the final disposal of motor accident compensation cases, as in all other classes of litigation, takes the sting out of the laws of compensation because, an infant child who seeks compensation as a dependent of his deceased father has often to await the attainment of majority in order to see the colour of the money. Add to that the monstrous inflation and the consequent fall in the value of the rupee: Compensation demanded say, ten years ago, is less than quarter of its value when it is received today. We do hope that the Government will apply itself seriously and urgently to this problem and find a satisfactory method of ameliorating the woes of victims of road accidents. 2. We have just talked of delay and it is just as well that we begin....
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....ile Section 94(1) provides for the necessity to insure a vehicle against third party risks. By that section, no person can use a motor vehicle in a public place, except as a passenger, unless there is in force in relation to the use of the vehicle a policy of insurance complying with the requirements of the chapter. Section 95 prescribes the requirements of the insurance policy and the "limits of liability" thereunder. Broadly, by Sub-section (1) of Section 95, a policy of insurance must insure the person or classes of persons specified in the policy to the extent specified in Sub-section (2) against any liability which may be incurred by him or them in respect of the death of or bodily injury to any person caused by or arising out of the use of the vehicle in a public place. The proviso to Sub-section (1) consists of three clauses by which, speaking generally, a policy is not required to cover (i) liability in respect of the death of or injuries to an employee arising out of and in the course of his employment; (ii) liability in respect of the death of or bodily injury to persons carried in the vehicle except where the vehicle is used for carrying passengers for hire or reward; an....
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....r Vehicles (Amendment) Act, 56 of 1969, which came into force on March 2, 1970. As a result of that amendment, the section reads thus: (2) -Subject to the proviso to Sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident upto the following limits, namely: (a) where the vehicle is a goods vehicle, a limit of fifty thousand rupees in all, including the liabilities, if any, arising under the Workmen's Compensation Act, 1923, in respect of the death of, or bodily injury to employees (other than the driver), not exceeding six in number, being carried in the vehicle; (b) where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment- (i) in respect of persons other than passengers carried for hire or reward, a limit of fifty thousand rupees in all; (ii) in respect of passengers: (1) a limit of fifty thousand rupees in all where the vehicle is registered to carry more than thirty passengers; (2) a limit of seventy-five thousand rupees in all where the vehicle is registered to carry more than thirty but not more than sixty passengers; ....
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....as restricted to twenty thousand rupees in respect of persons other than passengers carried for hire or reward; and to twenty thousand rupees in all in respect of passengers. The Amendment Act of 1956 did not make any change in Clause (b). But, the Amendment Act of 1969 enhanced the liability to the limit of fifty thousand rupees in all in respect of persons other than passengers carried for hire or reward. In respect of passengers, the liability was enhanced from twenty thousand rupees to fifty thousand rupees in all, seventy-five thousand rupees in all one lakh rupees in all, depending upon the registered capacity of the vehicle to carry passengers. 13. It may be recalled that the High Court awarded compensation in the sum of Rs. 19,125 to respondents 1 (a) to 1 (g) who are the heirs and legal representatives of Ajit Sinh who was driving the car, and Rs. 10,000 to Jadavji Modi who was travelling in the car. The total amount of compensation awarded to the claimants thus comes to Rs. 29,125 that is to say, it is in excess of Rs. 20,000. The contention of Shri Sorabjee who appears on behalf of the appellant insurance-company is, that under Clause (a) as it stood at the material t....
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....appellant and it is this: If two persons of unequal economic status die in the kind of collision mentioned above, the heirs of the affluent victim will virtually monopolise the compensation by getting a lion's share in it, thereby adding insult to the injury caused to the heirs of the indigent victim. The purpose of law is to alleviate, not augment, the sufferings of the people. It is well-known that the award of compensation depends upon a variety of factors, including the extent of monetary deprivation to which the heirs of the deceased are subjected. Applying that criterion as one of the many variable criteria which are applied for fixing compensation in motor accident cases, the heirs of the affluent victim may have been awarded, say, a compensation of Rs. 90,000. The heirs of the other victim who may have been just managing to keep his body and soul together will probably have received by that standard a compensation of, say, ten thousand rupees. The compensation awarded to these two groups of heirs shall have to be reduced ratably in the proportion of 9: 1, in order to ensure it does not exceed rupees twenty thousand "in all". The result of this will be that the insurance....
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....and alone and is not the only provision to be considered for determining the outside limit of the insurer's liability. In fact, Clause (a) does not even form a complete sentence and makes no meaning by itself. Like the other Clauses (b) to (d), Clause (a) is governed by the opening words of Section 95(2) to the effect that "a policy of insurance shall cover any liability incurred in respect of any one accident upto the following limits", that is to say, the limits laid down in Clauses (a) to (d). We have supplied emphasis in order to focus attention on the true question which emerges for consideration: What is the meaning of the expression "any one accident"? If that expression were plain and unambiguous, and its meaning clear and definite, effect would be required to be given to it regardless of what we think of its wisdom or policy. But as we will presently show, the expression "any one accident" does not disclose one meaning conclusively according to the laws of language. It, clearly, is capable of more than one meaning, introducing thereby an ambiguity which has to be resolved by resorting to the well-settled principles of statutory construction. 17. The expression "any ....
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....which deals with third party risks. That is a sensitive process which has to accommodate the claims of the society as reflected in that purpose. Indeed, it is in this area of legislative ambiguities, unfortunately not receding, that courts have to fill gaps, clear doubts and mitigate hardships. In the words of Judge Learned Hand: It is one of surest indexes of a mature and developed jurisprudence...to remember that statutes always have some purpose or object to accomplish whose sympathetic and imaginative discovery is the surest guide to their meaning. Cabell v. Markham 148 F. 2d 737, 739 (1945). There is no table of logarithms to guide or govern statutory construction in this area, which leaves a sufficient and desirable discretion for the Judges to interpret laws in the light of their purpose, where the language used by the law-makers does not yield to one and one meaning only. Considering the matter that way, we are of the opinion that it is appropriate to hold that the word "accident" is used in the expression "any one accident" from the point of view of the various claimants, each of whom is entitled to make a separate claim for the accident suffered by him and not from ....
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....sing out of the same occurrence". The Solicitor's assistant gave a certain advice in a motor accident case which betrayed negligence. The assistant had wrongly allowed a person to become administratrix of her late husband's estate and the assistant also failed to issue writs the six-month limitation period. A claim was made against the Solicitor for his assistant's negligence for depriving the claimants of their right to be paid damages. The court assessed the quantum of damages differently for different claimants, which together exceeded the sum of # 3000. It was held that the Solicitor's assistant was negligent twice and therefore there were two occurrences in the same case in respect of which the Solicitor became liable to pay damages for negligence. Accordingly, the insurance company was held liable to indemnify the Solicitor in respect of the damages awarded against him upto a limit of 3000 for each act of negligence. 21. In Halsbury's Laws of England, 4th Edn. Volume 25 Pages 354-355, paragraph 696 the decision in South Staffordshire Tramways company is cited in support of the proposition that the word 'accident'may fall to be construed from the....
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.... to rupees twenty thousand under Section 95(2)(a) of the Act. The involvement of more than one person in a single occurrence raises a different question for consideration under Section 95(2)(a) than the involvement of a single person in a single occurrence. In the latter case, it may be true to say that the liability of the insurer is limited to rupees twenty thousand under a statutory policy. In the former, the interpretation of the words "any one accident" came into play and we have already expressed our view on the meaning of those words. 24. In the case before the Karnataka High Court in Sanjiva Shelly, a taxi and a car met with a collision, as a result of which two persons travelling in the taxi, the driver of the car and a boy called Bharatisha sitting on the roadside were injured. Before the High Court was the claim of the driver of the car and the boy. A Division Bench of the High Court held that the total liability of the Insurance Company was limited to rupees twenty thousand in respect of the injuries suffered by them. The High Court apportioned the liability by directing the insurance company to pay Rs. 18,730 to the boy and Rs. 1,270 to the driver of the car. In vie....
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....ourt held that the straightforward course was to take the language of the Act as it stood, which left no doubt that in the case of a bus registered for carrying more than six passengers, the limit of the liability was twenty thousand rupees in all and there was a further limit in respect of each individual passenger in the sum of two thousand rupees. The words "any one accident' in the opening part of Section 95(2) made no difference to this interpretation because, if more than one passenger was injured in a single occurrence, no one passenger was entitled to receive more than rupees two thousand or four thousand, depending on the registered capacity of the vehicle to carry passengers. 26. The judgment of the Punjab High Court was brought in appeal to this Court in Sheikhupura Transport Co. Ltd. v. Northern India Transport Co. [1971] Supp. S.C.R. 20 For reasons aforesaid, the judgment in that case is not an authority on the interpretation of Clause (a) of Section 95(2). After setting out the relevant provisions of Section 95(2) at pages 24 and 25 of the Report, Hegde J. speaking for himself and Jaganmohan Reddy, J. concluded: In the present case we are dealing with a vehi....
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....larly so when the frequency of accidents involving the public transport system has increased beyond believable limits. The newspaper reports of August and September 1981 regarding deaths and injuries caused in such accidents have a sorry story to tell. But we need not reproduce figures depending upon newspaper assessment because, the newspapers of September 18, 1981 carry the report of a statement made by the Union Minister of State for Shipping and Transport before the North Zone goods transport operators ...that 20,000 persons were killed and 1.5 lakh were injured in highway accidents during 1980. We wonder whether adequate compensation was paid to this large mass of suffering humanity. In any event, the need to provide by law for the payment of adequate compensation without contest to such victims can no longer be denied or disputed. It was four years ago that this Court sounded a warning and a reminder Manjusri Raha and Ors. v. B.L. Gupta and Ors. [1977]2SCR944 . With the emergence of an ultra-modern age which has led to strides of progress in all spheres of life, we have switched from fast to faster vehicular traffic which has come as a boon to many, though some times in th....