Skip to content


Smt. Padmadevi and ors. Vs. Gurbakshsingh and ors. - Court Judgment

LegalCrystal Citation
SubjectMotor Vehicles
CourtRajasthan High Court
Decided On
Case NumberFirst Appeal No. 50 of 1969
Judge
Reported inAIR1973Raj317; 1973()WLN249
ActsMotor Vehicles Act, 1939 - Sections 2(19), 31, 96(2) and 96(6)
AppellantSmt. Padmadevi and ors.
RespondentGurbakshsingh and ors.
Appellant Advocate N.M. Kasliwal, Advs.
Respondent Advocate R.P. Goyal, Adv. (for No. 2) and; H.M. Lodha, Adv. (for No. 4)
DispositionAppeal partly allowed
Cases ReferredInsurance Society Ltd. v. Bhagaban Sahu
Excerpt:
.....the transfer was done after the permission of the transport authority granting the permit.;(b) motor vehicles act, 1939 - section 96(2)--action by third parties for compensation--insurance co. can raise a defence specified in section 96(2).;it is not open to an insurance company to raise the plea that the policy lapsed on the transfer of a vehicle in an action by third parties for compensation. section 96(2) of the motor vehicles act has specified the defences that are open to an insurance company to raise any other defence. the specification of the defence is exhaustive & it is not open to an insurance company to raise any other defence. the only circumstance in which the company can take up the above defence is that the policy has been cancelled in accordance with the..........also argued another aspect of this matter and we have considered that as well. section 22 of the motor vehicles act provides that no person shall drive any motor vehicle and no, owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place for the purpose of carrying passengers or goods unless the vehicle is registered in accordance with chapter iii of the act.12. another important section is 31 of the act and it reads as follows:--'31. where the ownership of any motor vehicle registered under this chapter is transferred,-- (a) the transferor shall, within fourteen days of the transfer, report the transfer to the registering authority within whose jurisdiction the transfer is effected and shall simultaneously send a copy of the said.....
Judgment:

Jain, J.

1. This is a plaintiffs' appeal, whose suit for damages has been decreed against respondents Nos. 1 and 5 only, seeking a decree against respondents Nos. 2, 3 and 4 as well.

2. One Manakchand, who was a lower division clerk in the office of the Assistant Director of Industries, Jaipur, was coming from his office on 11-10-1960 at about 5.30 p. m. and going towards Ajmeri Gate on Mirza Ismail Road, was struck by truck No. RJD-672, driven by Gurbaksh Singh, defendant-respondent No. 1. This accident took place near the Show Room of Globe Motors, on the Mirza Ismail Road, Jaipur. As a result of this accident Manakchand sustained injuries and he died on the spot soon after. The deceased was 30 years' old and was drawing Rs. 110 p. m. He was survived byhis widow Mst. Padma Devi, plaintiff No. 1, his son Tarachand, plaintiff No. 2 and three daughters, plaintiffs Nos. 3, 4 and 5. They claimed damages on account of the death of Manakchand in a sum of Rs. 20,000/-, from Gurbaksh Singh, driver of the truck, Har-charan Lal, defendant No. 2, (owner of the truck) and the New India Insurance Company Ltd., defendant No. 4. Since the plaintiffs were informed that the truck had been transferred prior to the date of the accident to Sardar Brijendra Singh under a hire-purchase agreement with Narula Finance Company, they also impleaded the said company as defendant No. 3 and the alleged transferee as defendant No. 5 and a decree was claimed against them as well.

3. Gurbaksh Singh did not put in appearance and the case proceeded against him ex parte.

4. Defendant No. 5 Sardar Brijendra Singh filed his written-statement and pleaded that the driver of the truck was not instructed to take the vehicle on the Mirza Ismail Road. It was also contended that there was no rash and negligent driving on the part of the driver. Another defence taken up by him was that he was holding the truck under the hire-purchase agreement. The financier of the truck was defendant No. 3 Narula Finance Company and as such till the instalments were paid, it was the Company which was the real owner of the truck. After filing the written-statement this defendant did not put in appearance and the case against him as well proceeded ex parte. It was admitted by him that the truck was insured with defendant No. 4 and it was the insurance company which was liable to pay the damages.

5. Harcharan Lal, defendant No. 2, pleaded in his written-statement that the truck had been sold out to defendant No. 5 and as such he was no longer liable for accident having taken place with the said vehicle. He, however, admitted that the truck was insured with defendant No. 4, the Indian Insurance Company.

6. Defendant No. 3 contended that the vehicle belonged to defendant No. 5, but the Company was the owner being the financier till the entire instalments were paid by defendant No. 5. According to this defendant, hire-purchase agreement was executed by defendant No. 5 first on 10-2-1960, but it was later superseded by agreement dated 23-2-1960 by which the defendant No. 5 agreed to pay Rs. 27,000/- in 24 instalments at the monthly rate of Rs. 1125/-.

7. Defendant No. 4 admitted that the truck No. RJD-672 was insured with the company in the name of Messrs. Harcharan Lal and Sons. But as the truck had been transferred to defendant No. 5 without the sanc-tion of the Company, Clause 5 of Section 2 of the policy has been contravened and, therefore, the insurance company was notliable for the damages on account of the accident.

8. The Senior Civil Judge No. 2, Jaipur City, tried the case on the issues arising on the pleadings of the parties. It was held that Manakchand died on account of the accident which had taken place on the Mirza Ismail Road on 11-10-1960 on account of rash and negligent driving by Gurbaksh Singh, driver of the truck No. RJD-672. The learned Judge also came to the conclusion that the truck had been transferred by defendant No. 2 to defendant No. 5 on 12-2-1960 and on that account there was a violation of the conditions of the policy. His finding, therefore, is that defendants Nos. 2 and 4 were not liable. He also exonerated Narula Finance Company, defendant No. 3, from the liability, as, according to him, the control of the vehicle was with defendant No. 5. The plaintiffs' claim for Rs. 19,200, was decreed against defendants Nos. 1 and 5 only. The plaintiffs being dissatisfied by the decree have come in appeal and have prayed for a decree against defendants Nos. 2. 3 and 4.

9. Respondents Nos. 1. 3 and 5 have not put in appearance in spite of notice. We have heard Shri N. M. Kasliwal on behalf of the appellants, Shri R. P. Goyal on behalf of respondent No. 2 and Shri H. M. Lodha on behalf of respondent No. 4.

10. The first contention on behalf of the appellants is that there was in fact no transfer of the vehicle by defendant No. 2 Harcharan Lal to defendant No. 5 Brijendra Singh. We were taken through the pleadings of the parties. Defendant Harcharan Lal has no doubt stated in his written-statement that he had transferred the truck in question to defendant No. 5, but we find that he did not give particulars of the same. He did not even mention as to on what date and for what amount the vehicle had been transferred to defendant No. 5. He also failed to produce the registration certificate or a copy of the same to show that the truck had actually been transferred before 11-10-1960 when the accident took place. Harcharan Lal did not come into the witness-box to allow himself to be subjected to cross-examination. On his behalf Kedarnath and Ganearam have been examined Kedarnath stated that he was at one time a partner in the Firm of Harcharan Lal and Sons and the truck in question had been sold to Brijendra Singh on 12-2-1960 for a sum of Rs. 28,100/-. He has produced an agreement purporting to have been signed by Brijendra Singh on 12-2-1960, but it has not been proved that it was so signed by him. In the written-statement it was not even disclosed whether Harcharan Lal and Sons was a partnership firm or a sole proprietorship concern. Another witness is Gangaram who is Munim of Harcharan Lal. Some 'rokar' and 'khata' entries have been produced and the Munim has tried to prove them. Both these wit-nesses are definitely not independent and they are interested in Harcharan Lal. It has been admitted by these witnesses that truck No. RJD-672 was registered in the name of Messrs. Harcharan Lal and Sons and it continues to be in that name. None of these witnesses has stated that any attempt was made to get the registration certificate transferred in the name of Brijendra Singh. The road tax as well has been paid in the name of Harcharan Lal and Sons. The truck is a public carrier and it is covered by a permit authorising the owner of the vehicle to ply for transportation of goods. For these reasons we are unable to hold that in fact the vehicle was transferred by Harcharan Lal to Sardar -Brijendra Singh.

11. Learned counsel for the parties have also argued another aspect of this matter and we have considered that as well. Section 22 of the Motor Vehicles Act provides that no person shall drive any motor vehicle and no, owner of a motor vehicle shall cause or permit the vehicle to be driven in any public place or in any other place for the purpose of carrying passengers or goods unless the vehicle is registered in accordance with Chapter III of the Act.

12. Another important Section is 31 of the Act and it reads as follows:--

'31. Where the ownership of any motor vehicle registered under this Chapter is transferred,--

(a) the transferor shall, within fourteen days of the transfer, report the transfer to the registering authority within whose jurisdiction the transfer is effected and shall simultaneously send a copy of the said report to the transferee;

(b) the transferee shall, within thirty days of the transfer, report the transfer to the registering authority within whose jurisdiction he resides, and shall forward the certificate of registration to that registering authority together with the prescribed fee and a copy of the report received by him from the transferor in order that particulars of the transfer of ownership may be entered in the certification of registration.

(2) A registering authority other than the original registering authority making any such entry shall communicate the transfer of ownership to the original registering authority.'

13. The combined effect of the above two sections is that no owner of a vehicle shall cause or permit the vehicle to be driven in a public place without getting it registered in accordance with the provisions contained in Chapter III. If the ownership of a motor vehicle registered under Chapter III is transferred, the transferor shall report the transfer to the registering authority within 14 days of, the transfer. And similarly the transferee shall within 30 days of the transfer report the matter to the registering authority. The transferee shall forward the certificate of re-gistration to the registering authority together with the prescribed fee for obtaining an endorsement of transfer. This is a mandatory requirement to be complied with when a vehicle used for the purpose of carrying goods or passengers is transferred. In the present case neither Harcharan Lal nor Sardar Brijendra Singh reported the factum of transfer to the concerned authority; nor did they obtain the endorsement of transfer on the registration certificate. Harcharan Lal has not appeared in the witness-box, nor did he or Brijendra Singh care to produce the registration certificate. In this view of the matter, we will only infer that the registration certificate which stood in the name of Messrs. Harcharan Lal and Sons continued to be in the name of Harcharan Lal and Sons.

14. Assuming that the truck in question exchanged hands and it came into the possession of Sardar Brijendra Singh, even then Harcharan Lal and Sons cannot escape the consequences of the accident on the mere ground that it had been transferred by them. In our opinion the transfer was of no legal effect. We may here give the relevant extracts or some provisions of the Motor Vehicles Act which are contained in Chapter IV of the Act and are meant to regulate the control of transport vehicles.

'42. (1) No owner of a transport vehicle shall use or permit the use of the vehicle in any public place (whether or not such vehicle is actually carrying any passenger or goods) save in accordance with the conditions of a permit granted or countersigned by a Regional or State Transport Authority (or the Commission) authorising the use of the vehicle in that place in the manner in which the vehicle is being used.'

'59. (1) Save as provided in Section 61 a permit shall not be transferable from one person to another except with the permission of the transport authority which granted the permit and shall not without such permission operate to confer on any person to whom a vehicle covered by the permit is transferred any right to use that vehicle in the manner authorised by the permit.'

15. It may be noticed here that Section 61 deals with cases of permits when the permit-holder dies. This section is obviously not applicable to the facts of the present case and need not be reproduced. From these provisions of the Act and others referred to hereinbefore, it is abundantly clear that a transport vehicle cannot be used nor can the owner cause the vehicle to be used in any public place except with the permit and in accordance with the conditions contained therein. Even the transfer of a vehicle, which is covered by a permit, will not confer any title on the transferee unless the permission of the Transport Authority granting the permit has been sought in advance. It has not been disputed that the truck in question wasused as a transport vehicle and it was covered by a permit granted to Harcharan Lal and Sons. On the date of the accident this was on the road. The mere fact that Harcharan Lal and Sons had transferred the possession of the vehicle to Brijendra Singh would not confer any title on the transferee as it has not been alleged or brought on record that the transfer was done after the permission of the Transport Authority granting the per-unit.

16. Reference in this connection may be made to Vimal Rai v. Gurcharan Singh, 1967 Ace CJ 115 (Delhi). In that casa Andley, J. observed :--

'To my mind, the sale of a motor vehicle will not- be governed by the ordinary law relating to sales of movable property. The Motor Vehicles Act, 1939 makes it compulsory for every owner of a motor vehicle to get the motor vehicle registered with the Registering Authority (vide Section 22). The Act prescribes by Section 24 the method of registration of a motor vehicle and by Section 31 of the transfer of ownership of a motor vehicle. A perusal of the various provisions of the Act leads to only one conclusion that ownership of a motor vehicle is to be evidenced by the registration as such with the Motor Registering Authority and the registration book which is supplied is the document of title. I think the Act proceeds on the basis that it is only the ostensible owner who is entered as such in the registration books, who is to be considered to be the owner of the motor vehicle irrespective of the fact that the real ownership may be with somebody else.'

17. In a similar case United Motors of Rajasthan v. Mathuralal, 1970 Raj LW 589 where the ostensible owner of the vehicle set up the plea of transfer before the date of the accident Lodha, J. quoted the aforesaid observation of Andley, J. with approval and said that the law requires something more for the sale of motor vehicles than what is necessary for sale of the property under the provisions of the Transfer of Property Act We fully endorse the above view.

18. In our judgment, therefore, Harcharan Lal and Sons being the ostensible owners of the truck were liable for the consequences of the accident which took place on 11-10-1960.

19. Learned counsel for Harcharan Lal placed reliance on a decision of this Court reported in Bhagwandas v. Nasir Mohammad, 1973 WLN 41 = (AIR 1973 Raj 237). In that case the plaintiff sold his truck to the defendant and handed over its possession to him. An agreement in that connection was also executed between the parties. According to the terms of the agreement all the taxes pertaining to the truck for the period prior to the date of the sale were to be paid by the plaintiff and subsequent thereto they were to be paid by the defendant. The registrationof the truck was not got transferred hi the name of the defendant with the result that the concerned Sales Tax Officer recovered goods tax and penalty in respect of the said truck from the plaintiff even for the period after the sale. The plaintiff instituted suit for recovery of the amount recovered from him against the defendant. Obviously the facts of that case are distinguishable. In that case the plaintiff filed the suit to enforce the agreement executed between them. The decision does not lend support to the contention that the sale in the present case was valid even when the registration of the vehicle was not endorsed in favour of the transferee.

20. Harcharan Lal has been described as proprietor of the Firm Harcharan Lal and Sons. No controversy has been raised in this regard by defendant No. 2. We, therefore, hold that Harcharan Lal as Proprietor, Harcharan Lal and Sons has a civil liability for the accident by the truck hi question.

21. Kedarnath witness D2/W1 for defendant No. 2 has admitted that Gurbaksh Singh was in the employment of Harcharan Lal, but as the truck had been transferred to Brijendra Singh on 12-2-1960, he was not in the employment of Harcharan Lal on the date of the accident. Another witness Ganga-ram D2/W2 has admitted that Gurbaksh Singh was in the employment of Harcharan Lal and he, on his behalf, used to pay the salary to Gurbaksh Singh. We have already found that there was no transter of the truck by Harcharan Lal in favour of Sardar Brijendra Singh. We will, therefore, hold that Gurbaksh Singh continued to remain in the employment of Harcharan Lal and he drove the truck on the date of the accident hi the course of his employment as a driver.

22. The trial judge has found that Gurbakash Singh was guilty of rash and negligent driving when he struck the deceased Manakchand on 11-10-1960. No argument has been addressed to us on behalf of Harcharan Lal to assail that finding.

23. As a necessary corollary, the Insurance Company, defendant No. 4, is liable inasmuch as it has been admitted that the truck in question was insured with the company by Harcharan Lal and Sons. The Insurance company only pleaded that it was not liable for the accident as there was a transfer by defendant No. 2 in favour of defendant No. 5 and that was in contravention of some condition of the policy. In view of our findings, recorded above, the plea of the insurance company cannot be upheld. Accordingly in our judgment defendant No. 4 is also liable for damages.

24. It has also been argued by Mr. Kasliwal that even if the plea of transfer is upheld, the Company cannot escape its liability as the plea of transfer was not open to the Company to be taken up in its defence. He has placed reliance on Section 96 (2) of the Motor Vehicles Act. He has referredto British India General Insurance Co. Ltd. v. Captain Itbar Singh, AIR 1959 SC 1331, where their Lordships of the Supreme Court were called upon to interpret Section 96 of the Motor Vehicles Act. It was observed:

'To start with it is necessary to remember that apart from the statute an insurer has no right to be made a party to the action by the injured person against the insured causing the injury. Sub-section (2) of Section 96 however gives him the right to be made a party to the suit and to defend it. The right therefore is created by statute and its content necessarily depends on the provisions of the statute. The question then really is, what are the defences that Sub-section (2) makes available to an insurer? That clearly is a question of interpretation of the sub-section.

Now the language of Sub-section (2) seems to us to be perfectly plain and to admit of no doubt or confusion. It is that an insurer to whom the requisite notice of the action has been given 'shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely', after which comes the enumeration of the grounds. It would follow that an insurer is entitled to defend on any of the grounds enumerated and no others. If it were not so, then of course no grounds seed have been enumerated. When the grounds of defence have been specified, they cannot be added to. To do that would be adding words to the statute.

Sub-section (6) also indicates clearly how Sub-section (2) should be read. It says that no insurer to whom the notice of the action has been given shall be entitled to avoid his liability under Sub-section (1) 'otherwise than in the manner provided for in Sub-section (2).' Now the only manner of avoiding liability provided for in Sub-section (2) is by successfully raising any of the defences therein mentioned. It comes then to this that the insurer cannot avoid his liability except by establishing such defences. Therefore subsection (6) clearly contemplates that he cannot take any defence not mentioned in Sub-section (2). If he could, then, he would have been in a position to avoid his liability in a manner other than that provided for in Sub-section (2). That is prohibited by Sub-section (6).

We therefore think that Sub-section (2) clearly provides that an insurer made a defendant to the action is not entitled to take any defence which is not specified in it.'

25. Mr. Kasliwal also referred to Madras Motor Insurance Co. Ltd., Madras v. Mohamed Mustafa Badsha, AIR 1961 Mad 208. In that case the Insurance company set up the plea of transfer in a suit for damages on account of an accident having taken place by the vehicle insured with the company. His Lordship placing reliance on the decision of the Supreme Court referred to above held that the statute had expressly con-fined the right of the insurer toavoid his liability under the policy to certain grounds and the Court cannot add to those grounds for reasons of hardship. The plea of transfer was thus not upheld.

26. Mr. Kasliwal has also referred to Vimal Rai v. Gurcharan Singh, 1967 Acc, C. J. 115 (Delhi). The Hindusthan General Insurance Society Ltd. v. P. R. Narsa Reddi, AIR 1972 Andh Pra 151 and Orissa Co-operative Insurance Society Ltd. v. Bhagaban Sahu, 1971 Ace C. J. 49 (Orissa). In all these cases it has been held that it is not open to an insurance company to raise the plea that the policy lapsed on the transfer of a vehicle in an action by third parties for compensation. Section 96 (2) of the Motor Vehicles Act has specified the defences that are open to an insurance company in a claim by a third party. The specification of the defences is exhaustive and it is not open to an insurance company to raise any other defence. The only circumstance in which the company can take up the above defence is that the policy has been cancelled in accordance with the provisions of Section 96 (2) (a). We are in respectful agreement with the decisions referred to above and we are (irmly of the opinion that it was not open to defendant No. 4 to raise any plea outside the scope of Section 96 (2).

27. Having found that the alleged transfer of the truck in question was of no legal consequence, the question that now arises before us is whether defendant No. 3 is also liable. Defendant No. 3 is a financier of defendant No. 5. In our opinion, liability for the accident cannot be fastened upon it.

28. Defendant No. 5 Sardar Brijendra Singh admittedly had the control of the truck in question and be has been held to be liable by the decree under challenge. According to the written statement of this defendant, he was in control of the vehicle. Section 2 (19) defines the word 'owner' and it can be aptly quoted here:--

'2 (19) 'Owner' means, where the person in possession of a motor vehicle is a minor, the guardian of such minor, and in relation to a motor vehicle which is the subject of a hire-purchase agreement, the person in possession of the vehicle under that agreement;' The definition of the word 'owner' is not exhaustive. Ordinarily the word 'owner' means a person in whom the proprietary title vests and in whose name the registration certificate stands. In the case of a minor, a person who manages the vehicle on behalf of the minor as guardian can be treated as the owner. Admittedly defendant No. 5 was in possession of the vehicle. That apart, he has not challenged the decree that has been passed against him. In this view of the matter, we do not propose to disturb the decree against him.

29. The respondents who have contested this appeal have not addressed any argument to challenge the quantum of dama.

30. In the result, the appeal is partly allowed, and we pass a decree against respondent No. 2 Harcharan Lal and respondent No. 4 New India Insurance Company Limited as well for Rs. 19,200/-. The decree against respondents Nos. 1 and 5 shall stand. All the respondents against whom the suit has been decreed shall be jointly and severally liable to pay the decretal amount

31. The appellants shall get costs of this Court from respondents Nos. 2 and 4 and of the court below from respondents Nos. 1, 2, 4 and 5. Since the appeal was filed in forma pauperis and the appellants have succeeded against respondents Nos, 2 and 4 also, the Court-fees payable on the memo of appeal shall be recoverable by the State Government from respondents Nos. 2 and 4. The appeal against respondent No. 3 is dismissed but without any order as to costs.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //