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P.K. Panda Vs. Smt. Premalata Choudhury and ors. - Court Judgment

LegalCrystal Citation
SubjectMotor Vehicles
CourtOrissa High Court
Decided On
Case NumberMisc. Appeal No. 163 of 1976
Judge
Reported inAIR1980Ori102; 49(1980)CLT285
ActsMotor Vehicles Act, 1939 - Sections 22, 24, 24(2), 31, 96 and 110; Transfer of Property Act, 1882 - Sections 123
AppellantP.K. Panda
RespondentSmt. Premalata Choudhury and ors.
Appellant AdvocateR. Mohanty, Adv. for ;P.C. Misra, Adv.
Respondent AdvocateK.C. Mohanty and ;P. Roy, Advs.
DispositionAppeal dismissed
Cases Referred(Roshan Lal Bhalla v. Sudesh Kumar
Excerpt:
.....assurance co. ltd. v birendra mohan de, 1995 (2) gau lt 218 (db) and union of india v smt gita banik, 1996 (2) glt 246, are not good law]. - the failure to report the transfer may involve some penalties under the law. if this proposition were to be correct, a consumer would never be able to obtain the ownership of a motor vehicle because he cannot get better title to the vehiclethan his transferor, that is the dealer. 3 :the legal position is well settled that once there is a change or a transfer of ownership of the vehicle, the policy of insurance automatically lapses and the insurance company stands totally absolved from the liability to indemnify the insured......p.k. panda had engaged late choudhury to defend him in a case at puri and on the date of accident shri panda requested late choudhury to go to puri in that connexion. though late choudhury wanted to travel by train or bus, shri panda insisted on taking him on his motor cycle. late choudhury reluctantly agreed to travel on the back of the motor cycle. shri panda drove the motor cycle at a high speed most rashly and negligently and caused the accident. as a result of this accident, late choudhury was thrown out of the motor cycle and he sustained serious injuries which resulted in his death. according to the claimants, late choudhury was earning about rs. 1,000/- per month and was contributing rs. 800/- per month for maintenance of his family. he was aged 47 years at the time of his death.....
Judgment:

P.K. Mohanti, J.

1. This is an appeal under Section 110-D of the Motor Vehicles Act against the decision of the Second Motor Accident Claims Tribunal, Puri awarding a compensation of Rs. 30,000/- in favour of respondents 1 to 6.

2. The accident which resulted in the death of Khetramohan Choudhury, an Advocate of this Court, occurred on 17-7-73 and it involved a motor cycle hearing No. ORO 9230. This motor cycle was purchased by respondent No. 7 Shyarna Sundar Misra on 16-5-73 and was registered in his name. He has taken an insurance policy from the New India Assurance Company Limited (respondent No. 8), which was valid till 16-5-74. The appellant Prafulla Kumar Panda is the sister's husband of the said Shyama Sundar Misra. The motor cycle had been given to him as dowry on the occasion or his marriage which took place on 27-5-73.

3. Respondent No. 1 is the widow of late Khetramohan Choudhury and respondents 2 to 6 are his children. They claimed a compensation of Rs. 1,28,000/-alleging that Shri P.K. Panda had engaged late Choudhury to defend him in a case at Puri and on the date of accident Shri Panda requested late Choudhury to go to Puri in that connexion. Though late Choudhury wanted to travel by train or bus, Shri Panda insisted on taking him on his motor cycle. Late Choudhury reluctantly agreed to travel on the back of the motor cycle. Shri Panda drove the motor cycle at a high speed most rashly and negligently and caused the accident. As a result of this accident, late Choudhury was thrown out of the motor cycle and he sustained serious injuries which resulted in his death. According to the claimants, late Choudhury was earning about Rs. 1,000/- per month and was contributing Rs. 800/- per month for maintenance of his family. He was aged 47 years at the time of his death and would have normally lived up to the age of at least 70 years. The claimants contended that Shri P.K. Panda, Shri S.S. Misra and the New India Assurance Company Ltd., were jointly and severally liable to pay the compensation.

4. The stand taken by Shri S.S. Misra was that he was neither the owner of the vehicle at the time of the accident nor had he authorised its driving by Shri P.K. Panda. He gave the motor cycle to Shri Panda as dowry on the occasion of his marriage which took place on 27-5-73 arid applied to the Regional Transport Oificer, Rourkela for recording the transfer of ownership with effect from 28-5-73. His contention was that he had ceased to be the owner of the vehicle since 28-5-73 and was not liable to pay compensation for the accident which occurred long after the transfer of ownership.

5. Shri P.K. Panda, the appellant, denied the allegation that he had engaged late Choudhury to defend him in a case at Puri. His contention was that on the date of accident while he was going to Puri, on the way he met late Choudhury who requested him for a lift on the pillion of the motor cycle. At first he did not agree, but ultimately agreed to give a lift being goaded and persuaded by late Choudhury. He denied the allegation that the accident occurred due to rash and negligent driving and stated that while he was negotiating a road-bend he turned the vehicle to the right side to avoid impact with two bullock carts and at the moment late Choudhury out of misapprehension jumped down and met with the accident.

6. The Insurance Company denied its liability to pay compensation for the death of a pillion rider and also contended that the policy of insurance had lapsed on the transfer of ownership.

7. The Tribunal, on a consideration of the evidence led, by the parties, came to the findings (1) that the accident occurred due to the negligent driving of the vehicle by the appellant Shri P. K Panda; (2) that Shri S.S. Misra had ceased to be the owner of the vehicle by the date of accident and Shri Panda was really the owner on that date; (3) that after transfer of the vehicle to Shri Panda the policy of insurance had lapsed; and (4) that Section 95 of the Motor Vehicles Act does not cover any liability in respect of death or bodily injury to a gratuitous passenger. Upon these findings, a sum of Rs. 30,000/- was awarded as compensation together with interest @ 6 per cent pet annum from the date of claim, i. e., 59-1973 and a sum of Rs. 300/- as costs of the claim proceeding. The appellant Shri P.K. Panda was held liable to pay the compensation and the claim as against the Insurer and the Insured was dismissed.

8. The questions that arise for consideration in this appeal are as follows:--

(1) Whether the accident occurred due to rash and negligent driving of the motor cycle by the appellant Shri P.K. Panda?

(2) Whether on the date of accident the motor cycle in question was owned by the appellant Shri P.K. Panda or the respondent No. 7 Shri S.S. Misra?

(3) Whether the respondent No. 8 --The New India Assurance Company --is liable to pay the Compensation?

(4) Whether the amount of compensation awarded is high and excessive? 9. Question No. 1:--

In order to prove rash and negligent driving of the vehicle, the claimants examined P. W. 2 Bansidhar Sahu. who claimed to be an eye-witness to the occurrence. He stated that the motor-cycle came from Bhubaneswar side at a high speed and while taking a turn at the road-bend it dashed against a heap ol chips, as a result of which the driver fell down with the vehicle and was draped to a distance over the metal chips and the person sitting on the back side of the vehicle was thrown to a distance of 20 cubits over a heap of chips. In cross-examination, he stated that he was working in his field which is close to the road and his attention was attracted towards the road when the motor-cycle went over the heap of chips making a sound. In view of this statement, the Tribunal rightly held that the witness had not actually seen the vehicle being driven at a high speed before the accident. The statements of the witness that the motor-cycle went over the heap of chips; that the driver fell down with the motor-cycle arid was dragged to a distance over the metalchips and that the person sitting on the back of the vehicle was thrown at a distance of 20 cubits, however, remained un-shaken by cross-examination. It is apparent that the appellant could not control the vehicle while negotiating the bend because it was driven at a high speed. The appellant, who was examined as O. P. W. 1, stated that while he was approaching the road-bend, he found two bullock carts coming from his opposite direction and slowed down the speed and attempted to pass the bullock carts by turning to his right. But at that moment late Choudhury, being afraid of the situation jumped down and fell on the metal chips. He stated in cross-examination that the vehicle was at a speed of about 30 kilometres per hour when he was negotiating the road-bend. While approaching the road-bend, it was incumbent on him to have reduced the speed and driven cautiously. As the carts were at a distance of about 100 cubits from him, he should have stopped the vehicle and allowed the carts to pass. If he had kept to left side of the road instead of taking a turn to the right side, the accident would have been averted. If he had taken all these precautions, it is extremely unlikely that the accident would have occurred. There can be no doubt that the appellant was negligent in not reducing the speed while approaching the bend, in not keeping to the left side of the road and in taking a turn to the right side. The Tribunal was, therefore, justified in holding that the accident occurred due to the negligent driving by the appellant.

10. Question No. 2:--

Shii S.S. Misra averred in his written statement that he had announced about presentation of the motor-cycle to Shri Panda on the marriage altar and physically delivered the same to him. He also stated that he had made an application to the registering authority to record the transfer of ownership with effect from, 25-5-1973. But the transfer of ownership; was recorded by the registering authority on 11-9-1973 after necessary enquiry. Shri. Panda admitted during his evidence in court that he had received the motor-cycle as dowry on the date of his. marriage, that: is, 27-5-73 and stated that about a week thereafter he had applied to the registering authority, Rourkela for recording the transfer of ownership in his favour. Section 123 of the T. P. Act provides that for the purpose of making a gift of movable property, the transfer may be, effected either by a registered instrument or by delivery.

The Tribunal held that as there was physical transfer of the vehicle in favour of Shri Panda on 27-5-73 and both the transferor and the transferee had intimated tile registering authority about transfer ol Ownership Shri Panda was the real owner of the vehicle on the date of accident Mr. R. Mohanty. the learned counsel appearing on behalf of Shri Panda contended that it is only the ostensible owner, whose name is entered in the registration book, who is to be considered as the owner of the vehicle irrespective of the fact that the ownership may be with somebody else. In support of his contention he relied upon a single Bench decision of this Court reported in 1971 ACJ 49, Orissa Co-operative Insurance Society Ltd. v. Bhagaban Sahu. The facts of that case are materially different. In that case there was no legal evidence to prove the alleged sale of the vehicle. The truck stood registered in the name of Hansraj who took the plea that he had sold it on 1-12-1960 to Mahendra Singh. Mahendra Singh did not admit the transaction of tale. An agreement for sale in respect ot the truck alleged to have been executed by Hansraj and Mahendra Singh was produced in court, but it was not duly proved. The learned Judge, however, observed, without examining any of the authorities on the subject that it is only the ostensible owner whose name is entered as such in the registration book, who is to be considered as the owner of the motor vehicle irrespective of the fact that the ownership may be with somebody else, It appears, however, that in a later decision of this Court in the case of South India Insurance Co. Ltd. v. Purna Chandra Misra; 1973 ACJ 46, the learned Judge who had decided the case in 1971 ACJ 49 accepted the contrary view taken by the Madras and Delhi High Courts to which I shall presently refer.

11. There is no provision of law that the registration of a motor vehicle with the registering authority is a sine qua non for transfer of ownership or that transfer without registration would be void or ineffective. Section 22 of the Motor Vehicles Act imposes a ban on 'the owner of a motor vehicle' from causing or permitting the vehicle to be driven in any public place either for the purpose of carrying passengers or goods without the vehicle being registered in accordance with the provisions of Chap. III of the Act, Section 24 provides that an application 'by or on behalf of the owner of a motor vehicle' for registration has to be made in the prescribed form and that a certificate of registration shall be issued to 'the owner of a motor vehicle in the prescribed form. Section 31 provides for recording all the particulars of the transfer of ownership in the certificate of registration and makes it obligatory on the transferor and the transferee to notify the registering authority of the fact of transfer of ownership. Thus, it pre-supposes a valid and subsisting transfer by the registered owner of the vehicle to another person. It is clear that the above provisions of the Act contemplate a completed transfer of ownership of a motor vehicle. The provisions of the Act regarding registration of vehicles have nothing to 5o with ownership. They only provide for regulation of the use of the motor vehicles in public places. The certificate of registration issued under Section 24(2) of the Act is not a document of title, but it is a piece of evidence to show the owner of the vehicle who is liable to pay taxes and to perform duties and obligations under the Act. There is nothing in the Act to indicate that it is the registered owner who shall be liable to pay compensation.

12. In the case of Sajan Singh v. Sardara Ali, 1960 AC 167, the Judicial Committee of the Privy Council observed that the registration book is not a document of title. It was also observed that the absence of registration would no doubt put the plaintiff in difficulty if he had to prove his title, but it would not invalidate the same.

13. A Division Bench of the Delhi Court in the case of Oriental Fire and General Insurance Co. Ltd. v. Vimal Roy 1972 ACJ 314, after referring to the several provisions of the Act and relying upon the Privy Council decision cited above, held as follows :--

'..... Our conclusion is that the certificate of registration is an important piece of evidence to ostensibly show the owner of the vehicle who is liable to pay taxes and to perform duties and obligations under the Motor Vehicles Act, but the endorsement of transfer on the certificate is not a condition precedent and its absence does not make an otherwise valid sale as illegal or ineffective'.

14. The Rajasthan High Court in the case of Automobile Transport (Rajasthan) Private Ltd. v. Dewalal, 1977 ACT 150 followed the view taken by the Delhi High Court in 1972 ACJ 314.

15. The Madras High Court in the case of the South India Insurance Co.Ltd. v. Lakshmi, 1971 ACJ 122 held asfollows:

'..... Change of registry under Section 31 is not a condition precedent for the transfer of ownership of the vehicles. Section 31 merely imposes an obligation both on the transferor and the transferee of the vehicles to notify the transfer. It does not invalidate a transfer as such for non-compliance with that section.

After referring to the decisions of different High Courts on the subject, it was also held as follows :--

'From the above decisions it is clearthat where a person states in the proposalform that he is the owner of the vehicleto be insured and gets his vehicle insuredon that basis, the insurer will be entitledto avoid liability if the owner of the vehicle has transferred the vehicle to anotherbefore the accident, and that notwithstanding the fact that the registry under Section 31continued in the name of the insured thecontract of insurance and along with itthe liability of the insurer to indemnifythe insured comes to an end as soon asthe vehicle is transferred by the insuredto another. ... .'

In an earlier decision reported in 1970 ACJ 18 (V. Muthuswami Goundar v. Thu-lasi Ammal) the High Court of Madras held as follows:--

'..... A reading of Section 31shows that contractual transfer of owner ship of a vehicle has to precede the application for transfer of ownership. As between the transferor and transferee, the sale gets completed before the transfer of the registration certificate. The failure to report the transfer may involve some penalties under the law. But that certainly does not interdict the passing of property in the vehicle to the transferee

16. The Punjab and Haryana High Court in the case of Phul Bus Service v. Financial Commr. Taxation Punjab, 1968 ACJ 57 laid down as follows :--

'........ No provision in the Act hasbeen shown to me which prohibits a motor vehicle being owned without its first being registered. If this were so, the manufacturers of motor vehicles and the dealers who acquire them from the manufacturers and sell them in the market, would not be owners of the vehicles before they sell the same to the consumers. If this proposition were to be correct, a consumer would never be able to obtain the ownership of a motor vehicle because he cannot get better title to the vehiclethan his transferor, that is the dealer. Section 31 of the Motor Vehicles Act also presupposes a completed transfer of the ownership of a vehicle before transferor and the transferee are required to intimate and report the transfer to the registering authority concerned. 1 am, therefore, of the considered opinion that registration under the Motor Vehicles Act is not a necessary ingredient of a completed title of ownership of a motor vehicle.....

17. In view of my foregoing discussions, I would agree with the Tribunal that Shri S.S. Misra had ceased to be owner of the vehicle and that Shri P.K. Panda was the real owner of the vehicle on the date of accident.

18. Question No. 3 :--

The legal position is well settled that once there is a change or a transfer of ownership of the vehicle, the policy of insurance automatically lapses and the insurance company stands totally absolved from the liability to indemnify the insured. In 1971 ACJ 122 (Mad) referred to above, it was held that the policy lapses as soon as the vehicle is physically transferred irrespective of whether the transfer has been registered with the registry or not. In 1971 ACJ 88 (Delhi) (Nanu Mal v. Inder Singh), a truck stood registered in the name of 'A' though he had sold it to 'B'. 'B' had made an application for transfer of the vehicle before the accident but the insurance company had not been informed of the transfer. It was held that neither 'A' nor the insurance company was liable to pay any compensation. In 1968 ACJ 63 (Roshan Lal Bhalla v. Sudesh Kumar), a Division Bench of the Jammu and Kashmir High Court held that when there is a change or transfer of ownership of the vehicle and the same is not conveyed to the insurer and accepted by him, the liability of the insurer under the policy is extinguished.

In 1973 ACJ 46, referred to above, the learned single Judge of this Court, who had decided the case in 1971 ACJ 49, referred to the decisions cited above and held as follows :--

' ...... An insurance policy being acontract of personal indemnity, the insurers cannot be compelled to accept responsibility in respect of a third party who may be quite unknown to them. Therefore, the motor car specified in the policy being the subject matter of the insurance, on insured parting with it by way of sale or transfer of ownership he can no longer have an insurable intererstto which the policy in his favour can relate and continue to have force.

...... It, therefore, follows that in theabsence of any express stipulation to thecontrary in the policy, the moment theinsured parts with the car the policy relating to it lapses......'

19. In the present case, there is absolutely no evidence that the transfer of ownership was reported to the Insurance Company and accepted by it before the accident. The policy of insurance has not been produced in the case. After arguments were concluded and judgment reserved, the appellant filed a petition on 27-11-79 for admitting a document as additional evidence to show that Shri S.S. Misra was the original holder of the policy which was valid from 17-5-73 to 16-5-74 and that the said policy was transferred from 1-10-73 in favour of Shri P.K. Panda. I do not think the document sought to be admitted as additional evidence will be useful for disposing of the appeal. Shri P.K. Panda might have got the policy of insurance transferred in his favour from 1-10-73, but the fact remains that transfer of ownership was not notified to the Insurance Company and accepted by it before the accident. A policy of insurance being a contract of personal indemnity, the Insurance Company cannot be compelled to indemnify a third party who was unknown to it at the time of accident. I would, therefore, agree with the Tribunal that the Insurance Company is not liable to pay the compensation.

20. Question No. 4 :--

Regarding the quantum of compensation, the Tribunal considered the life expectancy of the deceased, his monthly income and the expenditure which he could have made for himself and his family. The average span of life was taken to be 65 years and only a sum of Rs. 30,000/-was awarded as compensation. The widow of the deceased who was examined as P. W. 1 stated that the deceased had 20 years' practice at the Bar and he was earning about Rs. 1,000/- per month out of which he was contributing Rs. 800/-per month for maintenance of the family. P. W. 3 who is a close neighbour of the claimants stated that the deceased was a busy practitioner and his office was always crowded. The Tribunal, however, estimated the annual income of the deceased fat Rs. 5,000/-. After deducting Rs. 2,000/-for the personal expenses of the deceased, his contribution to the family consisting of his wife and five children was taken to be Rs. 3,000/- a year. I do not think in the circumstances of this case, the award made by the Tribunal is high and excessive.

21. There is, therefore, no merit in this appeal and it is accordingly dismissed with costs to respondents 1 to 6 only the hearing fee being assessed at Rs. 100/-.


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