SANJEEV KUMAR SAMRATversusNATIONAL INSURANCE CO. LTD. AND OTHERS

                      [2012) 13 S.C.R. 174


A                 SANJEEV KUMAR SAMRAT
                                v.
        NATIONAL INSURANCE CO. LTD. AND OTHERS
             (Civil Appeal No. 8925 of 2012 etc.)

                      DECEMBER 11, 2012
B
        [K.S. RADHAKRISHNAN AND DIPAK MISRA, JJ.]

       Motor Vehicles Act, 1988 - ss. 147 and 167 - Insured
  goods vehicle - Hired - Accident of the vehicle - Causing
C death of the hirer and its two employees - Claim for
  compensation - Tribunal holding that Insurance company was
  liable to pay the compensation - High Court holding that
  Insurance company was liable only in respect of the hirer and
  not to its employees - On appeal, held: Order of High Court
D is correct - The statutory policy only covers the employees
  of the insured, covered under Workmen's Compensation Act
  and not any other kind of employee - Workman's
  Compensation Act, 1923.

E       The appellant-owner of a goods vehicle, insured the
    vehicle with the respondent-Insurance Company. The
    vehicle was hired for carrying goods. When the hirer
    alongwith his two labourers was going with the goods,
    the vehicle met with an accident resulting in death of the
    hirer and the two labourers.
F
       The legal representatives of the deceased filed claim
  petitions. The Insurance Company took the stand that it
  was not liable to indemnify the labourers employed by
  the hirer. Motor Accident Claims Tribunal held that
G Insurance Company was liable to indemnify the legal
  heirs of the three deceased. In appeal, Single Jude of High
  Court held that the Insurance Company was liable to pay
  the compensation to the legal representatives of the hirer,
  but not to his employees. Since the Insurance Company
H                              174
      SANJEEV KUMAR SAMRAT v. NATIONAL                    175
             INSURANCE CO. LTD.
had already deposited the amount of compensation, the            A
Court held that the company was entitle to recover the
compensation amount from the owner of the vehicle as
regards the compensation amount for the two deceased
employees.
                                                                 8
    Dismissing the appeals, the Court

    HELD: 1.1 As per Section 147(1)(b)(i) of the Motor
Vehicles Act, the policy is required to cover a person
including the owner of the goods or his authorised
representative carried In the vehicle. An owner of the           C
goods or his authorised agent is covered under the
policy. That is the statutory requirement. It does not
cover any passenger. [Para 19] [186-C-D]
      1.2 The insurer's liability as regards employee is         o
restricted to the compensation payable under the
Workmen's Compensation Act, 1923. The categories of
employees which have been enumerated in the sub·
clauses (a), (b) and (c) of the proviso (i) to Section 147(1)
are the driver of a vehicle, or the conductor of the vehicle,    E
If it is a public service vehicle or in examining tickets on
the vehicle, if it is a goods carriage, being carried in the
vehicle. [Para 19] [186-C-G]

     1.3 It is the settled principle of law that the liability of
an Insurer for payment of compensation either could be F
statutory or contractual. On a reading of the proviso to
Sub-Section (1) of Section 147 of the Act, it is demonstrable
that the insurer is required to cover the risk of certain
categories of employees of the insured stated therein. The
Insurance company Is not under statutory obligation to G
cover all kinds of employees of the insurer as the statute
does not show command. That apart, the liability of the
insurer in respect of the said covered category of
employees is limited to the extent of the liability that arises
                                                                  H
    176    SUPREME COURT REPORTS             [2012) 13 S.C.R.


A under the 1923 Act. There is also a stipulation in Section
  147 that the owner of the vehicle is free to secure a policy
  of insurance providing wider coverage. In that event, the
  liability would travel beyond the requirement of Section
  147 of the Act, regard being had to its contractual nature.
a But, a pregnant one, the amount of premium would be
  different. [Para 20] [187-B-E]

        Oriental Insurance Co. Ltd. v. Devireddy Konda Reddy
    and Ors. (2003) 2 sec 339: 2003 (1) SCR 537 - relied on.
C        Ved Prakash Garg v. Premi Devi and Ors. (1997) 8 SCC
    1: 1997 (4) Suppl. SCR 250 - referred to.

       1.4 On an apposite reading of Sections 147 and 167,
  the intendment of the Legislature, is to cover the injury
0 to any person including the owner of the goods or his
  authorised representative carried in a vehicle and an
  employee who is carried in the said vehicle. A policy is
  not required to cover the liability of the employee except
  an employee covered under the 1923 Act and that too in
E respect of an employee carried in a vehicle. To put it
  differently, it does not cover all kinds of employees. [Para
  24) [189-H; 190-A-B]

       1.5 On a contextual reading of the provision,
  schematic analysis of the Act and the 1923 Act, it is quite
F limpid that the statutory policy only covers the employees
  of the insured, either employed or engaged by him in a
  goods carriage. It does not cover any other kind of
  employee and therefore, someone who travels not being
  an authorised agent in place of the owner of goods, and
G claims to be an employee of the owner of goods, cannot
  be covered by the statutory policy and to hold otherwise
  would tantamount to causing violence to the language
  employed in the Statute. Therefore, the insurer would not
  be liable to indemnify the insured. [Para 24) [190-8-D]
H
      SANJEEV KUMAR SAMRAT v. NATIONAL                  177
             INSURANCE CO. LTD.

     1.S The policy in the instant case clearly states that    A
insurance is only for carriage of goods and does not
cover use of carrying passengers other than employees
not more than six in number coming under the purview
of the 1923 Act. On a bare reading of the policy, there can
be no iota of doubt that the policy relates to the insured     B
and it covers six employees (other than the driver, not
exceeding six in number) and it is statutory in nature. It
neither covers any other category of person nor does it
increase any further liability in relation to quantum. [Para
25) [190-E; 191-A-B]                                           C

     National Insurance Company Ltd. v. Baljit Kaur and Ors.
(2004) 2 SCC 1: 2004 (1) SCR 274; New India Assurance
Co. Ltd. v. Satpal Singh (2000) 1 SCC 237:1999 (5) Suppl.
 SCR 149; New India Assurance Co. Ltd. v. Asha Rani and
Ors. (2003) 2 SCC 223: 2002 (4) Suppl. SCR 543; National       D
Insurance Co. Ltd. v. Bommithi Subbhayamma and Ors.
(2005) 12 SCC 243; New India Assurance Co. Ltd. v. Vedwati
and Ors. (2007) 9 SCC 486: 2007 (2) SCR 918; National
Insurance Co. Ltd. v. Cholleti Bharatamma and Ors. (2008)
1 SCC 423:2007 (11) SCR 531; National Insurance Co. Ltd.       E
v. Prembati Patel and Ors. (2005) 6 SCC 172: 2005 (3)
SCR 655 - relied on.

    New India Assurance Co. Ltd. v. Satpal Singh (2000) 1
SCC 237: 1999 (5) Suppl. SCR 149 - referred to.                F
                    Case Law Reference:
    2004 (1) SCR 274           Relied on          Para 6
    1999 (5) Suppl. SCR 149 Relied on             Para 12
                                                               G
    2002 (4) Suppl. SCR 543 Relied on             Para 13
    (2005) 12 sec 243          Relied on          Para 15
    2007 (2) SCR 918           Relied on          Para 16
    2007 (11) SCR 531          Relied on          Para 17      H
    178      SUPREME COURT REPORTS              (2012] 13 S.C.R.


A         2005 (3) SCR 655          Relied on          Para 18

          2003 (1) SCR 537          Relied on          Para 22

          1997 (4) Suppl. SCR 250 Referred to          Para 23

B       CIVIL APPELLATE JURISDICTION : Civil Appeal No.
    8925 of 2012.

        From the Judgment & Order dated 13.01.2006 oft he High
    Court of Himachal Pradesh, Shimla at Shimla in F.A.O. (MVA)
    No. 175 of 2003.
c                                 WITH
    C.A. No. 8926 of 2012.

      Rajesh Gupta, Harpreet Singh (for K.J. John & Co.) for the
D Appellant.
        M.K. Dua, Karan Chawla, Kishore Rawat for the
    Respondents.

          The Judgment of the Court was delivered by
E         DIPAK MISRA, J. 1. Leave granted.
       2. The centripodal issue that emanates for consideration
  in these appeals is whether the insurer is obliged under law to
  indemnify the owner of a goods vehicle when the employees
F engaged by the hirer of the vehicle travel with the owner of the
  goods on the foundation that they should be treated as
  "employees" covered under the policy issued in accordance
  with the provision contained under Section 147 of the Motor
  Vehicles Act, 1988 (for brevity "the Act").
G
       3. The expose' of facts are that a truck bearing HP/10/
  0821 was hired on 12.4.2000 for carrying iron rod and cement
  by one Durga Singh who was travelling with the goods along
  with two of his labourers. When the vehicle was moving through
H Khara Patthar to Malethi, 1.5 KM ahead of Khara Patthar, about
      SANJEEV KUMAR SAMRAT v. NATIONAL                         179
      INSURANCE CO. LTD. [DIPAK MISRA, J.]
4.30 p.m., it met with an accident as a consequence of which          A
the labourers, namely, Nagru Ram and Desh Raj and also
Durga Singh, sustained injuries and eventually succumbed to
the same.

     4. The legal heirs of all the deceased persons filed             B
separate claim petitions under Section 166 of the Act before
the Motor Accidents Claims Tribunal (II), Shimla (for short "the
tribunal"). Before the tribunal, respondent No. 3, namely,
National Insurance Company Ltd., apart from taking other pleas,
principally took the stand that it was not liable to indemnify the    C
labourers employed by the hirer. The owner of the truck, the
present appellant, admitted the fact of hiring the truck but
advanced the plea that the insurer was under legal obligation
to indemnify the owner.

     5. On consideration of the evidence brought on record, the       D
tribunal came to hold that the legal representatives of Nagru
Ram and Desh Raj were covered as per the insurance policy,
exhibit RW-2/3/A, as the policy covered six employees and
accordingly fixed the liability on the insurer. As far as the legal
representative of Desh Raj is concerned, the tribunal treated         E
him as the owner of the goods who was travelling along with
the goods and accordingly saddled the liability on the 3rd
respondent therein.

     6. Being grieved by the awards passed by the tribunal, the       F
insurer preferred FAO (MBA) Nos. 175, 176 and 178 of 2003
before the High Court of Himachal Pradesh at Shimla. In
appeal, the learned single Judge, by order dated 13.1.2006,
allowed FAQ Nos. 175 and 176 of 2003 wherein the legal
representatives of the deceased employees were the
claimants. As far as FAQ No. 178 of 2003 is concerned, the            G
High Court concurred with the finding recorded by the tribunal
that Durga Singh was the owner of the goods and travelling
along with the goods and, therefore, the insurer was liable to
pay compensation to his legal representatives. It is worthy to
note that as the insurance company had already deposited the          H
    180      SUPREME COURT REPORTS                 [2012] 13 S.C.R.


A amount of compensation, the High Court, placing reliance on
  the decision in National Insurance Company Ltd. v. Baljit Kaur
  and Others 1 , directed that the insurance company having
  satisfied the award shall be entitled to recover the same along
  with interest from the owner-insured by initiating execution
B proceedings before the tribunal. Hence, the present appeals
  at the instance of the owner of the vehicle.

         7. We have heard Mr. Rajesh Gupta, learned counsel for
    the appellant, and Mr. M. K Dua, learned counsel for respondent
C No. 1.
       8. It is submitted by Mr. Gupta that the High Court has
  committed serious error in coming to hold that an employee of
  the hirer is not covered without appreciating the terms of the
  policy which covers the driver and six employees. Learned
D Counsel has laid emphasis on the words "any person" used in
  Section 147 of the Act. Referring to the said provision, it is
  urged by him that tho term "employee" has to be given a
  broader meaning keeping in view the language employed in
  the policy and also in view of the fact that the Act is a piece of
E beneficial legislation. It is his further submission that there is a
  distinction between "passenger" in a goods vehicle and an
  "employee" of the hirer of the vehicle but the High Court has
  gravely erred by not appreciating the said distinction in proper
  perspective.
F      9. Mr. M.K. Dua, learned counsel for the first respondent,
  combating the aforesaid proponements, contended that the
  decision rendered by the High Court is absolutely flawless
  inasmuch as the entire controversy is covered by many a dictum
  of this Court some of which have been appositely referred to
G by the High Court. It is urged by him that the extended meaning
  which is argued to be given to the term "employee" by the
  appellant is not legally acceptable as the employee has to be
  that of the insurer. It is canvassed by him that there is a manifest

H · 1. (2004) 2 sec 1.
       SANJEEV KUMAR SAMRAT v. NATIONAL                        181
       INSURANCE CO. LTD. [DIPAK MISRA, J.]
fallacy in the argument propounded on behalf of the appellant         A
that the policy covers such kinds of employees though on the
plainest reading of the policy, it would be vivid that the same
does not cover such categories of employees. It is his further
submission that the policy in question is an "Act Policy" and in
the absence of any additional terms in the contract of insurance,     B
the same can be broadened to travel beyond the language
employed in the policy to cover the employees of the owner of
the goods making the insurer liable.

      10. To appreciate the controversy, it is necessary to refer     C
to certain statutory provisions. Section 146 of the Act provides
for the necessity for injuries against third party risk. On a
reading of the said provision, there can be no trace of doubt
that the owner of the vehicle is statutorily obliged to obtain an
insurance for the vehicle to cover the third party risk, apart from
the exceptions which have been carved out in the said provision.      D
Section 147 of the Act deals with requirements of policies and
limits of liability. The relevant part of Section 147 (1) is
reproduced below:-

     "147. Requirements of polictes and limits of liabllity.-         E
     (1} In order to comply with the requirements of this
     Chapter, a policy of insurance must be a policy which-

            (a) is issued by a person who is an authorised
            insurer; or
                                                                      F
            (b) insures the person or classes of persons
            specified in the policy to the extent specified in sub-
            section (2)-

                   (i) against any liability which may be incurred    G
                   by him in respect of the death of or bodily
                   [injury to any person, including owner of the
                   goods or his authorised representative
                   carried in the vehicle] or damage to any
                   property of a third party caused by or arising     H
    182       SUPREME COURT REPORTS                    [2012] 13 S.C.R.


A                        out of the use of the vehicle in a public place;

                         (ii) agairist the death of or bodily injury to any
                         passenger of a public service vehicle
                         caused by or arising out of the use of the
B                        vehicle in a public place:

          Provided that a policy shall not be required-

                 (i) to cover liability in respect of the death, arising
                 out of and in the course of his employment, of the
c                employee of a person insured by the policy or in
                 respect of bodily injury sustained by such an
                 employee arising out of and in the course of his
                 employment other than a liability arising under the
                 Workmen's Compensation Act, 1923 (8 of 1923)
D                in respect of the death of, or bodily injury to, any
                 such empfoyee-

                         (a) engaged in driving the vehicle, or

                         (b) if it is a public service vehicle engaged
E                        as conductor of the vehicle or in examining
                         tickets on the vehicle, or

                         (c) if it is a goods carriage, being carried in
                         the vehicle, or
F         (ii) to cover any contractual liability."

       11. Be it noted, before Section 147(1)(b)(i) came into
  existence in the present incarnation, it stipulated that a policy
  of insurance must be a policy which insured the person or
G classes of persons to the extent specified in sub-section (2)
  against the liability incurred by him in respect of the death of
  or bodily injury to any person or damage to any property or third
  party caused by or arising out of the use of the vehicle in public
  place.
H
                                                            •
        SANJEEV KUMAR SAMRAT v. NATIONAL                        183
        INSURANCE CO. LTD. [DIPAK MISRA, J.]
       12. Regard being had to the earlier provision and the           A
amendment, this Court in New India Assurance Co. Ltd. v.
Satpal Singh2 , scanned the anatomy of the provision and also
of Section 149 of the Act and expressed the view that under
the new Act, an insurance policy covering the third party risk
does not exclude gratuitous passenger in a vehicle, no matter          B
that the vehicle is of any type or class. It was further opined that
the decisions rendered under the 1939 Act in respect of
gratuitous passengers were of no avail while considering the
liability of the insurer after the new Act came into force.

     13. The correctness of the said decision came up for              C
consideration before a three-Judge Bench in New India
Assurance Co. Ltd. v. Asha Rani and Others3. The learned
Chief Justice, speaking for himself and H.K. Serna, J. took note
of Section 147(1) prior to the amendment and the amended
provision and the objects and reasons behind the said provision        D
and came to hold as follows:-
       ''The objects and reasons of clause 46 also state that it
      seeks to amend Section 14 7 to include owner of the goods
      or his authorised representative carried in the vehicle for E
      the purposes of liability under the insurance policy. It is no
      doubt true that sometimes the legislature amends the law
      by way of amplification and clarification of an inherent
      position which is there in the statute, but a plain meaning
      being given to the words used in the statute, as it stood F
      prior to its amendment of 1994, and as it stands
      subsequent to its amendment in 1994 and bearing in mind
      the objects and reasons engrafted in the amended
      provisions referred to earlier, it is difficult for us to construe
      that the expression "including owner of the goods or his G
      authorised representative carried in the vehicle" which was
      added to the pre-existing expression "injury to any person"
      is either clarificatory or amplification of the pre-existing
2.   c2000) 1 sec 237.
3.   (2003) 2 sec 223.                                                 H
    184       SUPREME COURT REPORTS                   [2012] 13 S.C.R.


A         statute. On the other hand it clearly demonstrates that the
          legislature wanted to bring within the sweep of Section 147
          and making it compulsory for the insurer to insure even in
          case of a goods vehicle. the owner of the goods or his
          authorised representative being carried in a goods vehicle
B         when that vehicle met with an accident and the owner of
          the goods or his representative either dies or suffers bodily
          injury."                     [Emphasis supplied]

          14. S.B. Sinha, J., in his concurring opinion, stated thus: -

c         "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
D         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.
E
                  An owner of a passenger-carrying vehicle must pay
          premium for covering the risks of the passengers. If a
          liability other than the limited liability provided for under the
          Act is to be enhanced under an insurance policy. additional
          oremium is required to be paid. But if the ratio of this
F         Court's decision in New India Assurance Co. v. Satpal
          Singh 4 is taken to its logical conclusion, although for such
          passengers, the owner of a goods carriage need not take
          out an insurance policy, they would be deemed to have
          been covered under the policy wherefor even no premium
G         is required to be paid."        [Emphasis supplied]

    Being of the aforesaid view, the three-Judge Bench overruled
    the decision in Satpal Singh (supra).

H 4. (2000) 1 sec 237.
        SANJEEV KUMAR SAMRAT v. NATIONAL                      185
        INSURANCE CO. LTD. [DIPAK MISRA, J.]
    15. In Baljit Kaur (supra) and National Insurance Co. Ltd.       A
v. Bommithi Subbhayamma and Others5, the aforesaid view
was reiterated.
    16. In New India Assurance Co. Ltd. v. Vedwati and
Others6, after referring to the scheme of the Act and the earlier    8
pronouncements, it has been held that the provisions of the Act
do not enjoin any statutory liability on the owner of a vehicle to
get his vehicle insured for any passenger travelling in a goodi;
carrier and the insurer would have no liability therefor.

     17. In National Insurance Co. Ltd. v. Cholleti Bharatamma       C
and Others7 , the Court laid down that the provisions engrafted
under Section 147 of the Act 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 and hence, any injury
to any person in Section 147(1)(b) would only mean a third party     D
and not a passenger travelling in a goods carriage, whether
gratuitous or otherwise.
     18. At this juncture, we may refer with profit to the decision
of a three-Judge Bench in National Insurance Co. Ltd. v. E
Prembati Patel and Others8 wherein the legal representatives
of the driver of the truck had succeeded before the High Court
and were granted compensation of Rs.2, 10,000/- repelling the
contention of the insurer that the liability was restricted as
provided under the Workmen's Compensation Act, 1923 (for
short "the 1923 Act"). After discussing the schematic postulates F
of the provision, the Court ruled that where a policy is taken by
the owner of the goods vehicle, the liability of the insurance
company would be confined to that arising under the 1923 Act
in case of an employer. It further observed that the insurance
policy being in the nature of a contract, it is permissible for an G

5.   c2005) 12 sec 243.
6.   c2001) e sec 486.
1.   c2008) 1 sec 423.
8.   c2005) 6 sec 112.                                               H
    186      SUPREME COURT REPORTS                 [2012) 13 S.C.R.


A owner to take such a policy whereunder the entire liability in
   respect of the death of or bodily injury to any such employee
   as is described in Sub-Sections (a), (b) or (c) of the proviso to
   Section 147(1)(b) may be fastened upon the insurance
   company and the insurer may become liable to satisfy the
13 entire award. But for the said purpose, he may be required to
   pay additional premium and the policy must clearly show that
   the liability of the insurance company is unlimited.
        19. Keeping in view the aforesaid enunciation of law, it is
  to be seen how the term "employee" used in Section 147 is
C required to be understood. Prior to that, it is necessary to state
  that as per Section 147(1 )(b)(i), the policy is required to cover
  a person including the owner of the goods or his authorised
  representative carried in the vehicle. As has been interpreted
  by this Court, an owner of the goods or his authorised agent is
D covered under the policy. That is the statutory requirement. It
  does not cover any passenger. We are absolutely conscious
  that the authorities to which we have referred to hereinbefore
  lay down the principle regarding non-coverage of passengers.
  The other principle that has been stated is that the insurer's
E liability as regards employee is restricted to the compensation
  payable under the 1923 Act. In this context, the question that
  has been posed in the beginning to the effect whether the
  employees of the owner of goods would come within the ambit
  and sweep of the term "employee" as used in Section 147(1 ),
F is to be answered. In this context, the proviso to Section
   147(1)(~) gainS""significance. The categories of employees
  which have been enumerated in the sub-clauses (a), (b) and
  (c) of the proviso (i) to Section 147(1) are the driver of a vehicle,
  or the conductor of the vehicle if it is a public service vehicle
G or in examining tickets on the vehicle, if it is a goods carriage,
  being carried in the vehicle. It is submitted by the learned
  counsel for the appellant that sub-clause (c) is of wide import
  as it covers employees in a goods carriage being carried in a
  vehicle. The learned counsel for the insurer would submit that
H it should be read in the context of the entire proviso, regard
       SANJEEV KUMAR SAMRAT v. NATIONAL                         187
       INSURANCE CO. LTD. [DIPAK MISRA, J.]
being had to the schematic concept of the 1923 Act and the              A
restricted liability of the insurer. It is further urged that
contextually read, the meaning becomes absolutely plain and
clear that employee which is statutorily mandated to be taken
by the insured only covers the employees employed or
engaged by the employer as per the policy.                              B

      20. It is the settled principle of law that the liability of an
insurer for payment of compensation either could be statutory
or contractual. On a reading of the proviso to Sub-Section (1)
of Section 147 of the Act, it is demonstrable that the insurer is       C
required to cover the risk of certain categories of employees
of the insured stated therein. The insurance company is not
under statutory obligation to cover all kinds of employees of the
insurer as the statute does not show command. That apart, the
liability of the insurer in respect of the said covered category
of employees is limited to the extent of the liability that arises      D
under the 1923 Act. There is also a stipulation in Section 147
that the owner of the vehicle is free to secure a policy of
insurance providing wider coverage. In that event, needless to
say, the liability would travel beyond the requirement of Section
147 of the Act, regard being had to its contractual nature. But,        E
a pregnant one, the amount of premium would be different.

     21. At this stage, we may usefully refer to Section 167 of
the Act which reads as follows: -                     ·

    "167. Option regarding claims for compensation in
                                                                        F
    certain cases.- Notwithstanding anything contained in the
    Workmen's Compensation Act, 1923 (8 of 1923) where
    the death of, or bodily injury to, any person gives rise to a
    claim for compensation under this Act and also under the
    Workmen's Compensation Act, 1923, the person entitled               G
    to compensation may without prejudice to the provisions
    of Chapter X claim such compensation under either of
    those Acts but not under both.';            ·

From the aforesaid provision, it is quite vivid that where a death      H
    188       SUPREME COURT REPORTS                [2012] 13 S.C.R.


A or bodily injury to any person gives rise to a claim under the
  Act as well as under the 1923 Act, the said person is entitled
  to compensation under either of the Acts, but not under both.

       22. Coming to the scheme of the 1923 Act, it is worth
  noticing that under Section 3 of the said Act, the employer is
8
  liable to pay compensation to the workman in respect of
  personal injury or death caused by an accident arising out of
  or in the course of his employment. Section 4 provides the
  procedure how the amount of compensation is to be
C determined. In this context, we may usefully quote a passage
  from Oriental Insurance Co. Ltd. v. Devireddy Konda Reddy
    and Others9 : -
          ".... Section 147 of the Act mandates compulsory coverage
          against death of or bodily injury to any passenger of "public
D         service vehicle". The proviso makes it further clear that
          compulsory coverage in respect of drivers and conductors
          of public service vehicle and employees carried in goods
          vehicle would be limited to liability under the Workmen's
          Compensation Act, 1923 (in short "the WC Act"). There is
E         no reference to any passenger in "goods carriage."
          [Underlining is ours]

         23. In Ved Prakash Garg v. Premi Devi and Others10 , after
    referring to the scheme of the 1923 Act in the context of
F   payment of penalty for default by the insurer under Section 4-A
    of the Act, this Court held thus: -

          "On a conjoint operation of the relevant schemes of the
          aforesaid twin Acts, in our view, there is no escape from
          the conclusion that the insurance companies will be liable
          to make good not only the principal amounts of
          compensation payable by insured employers but also
          interest thereon, if ordered by the Commissioner to be paitl

    9. (2003) 2 sec 339.
H   10. (1997) a sec 1.
      SANJEEV KUMAR SAMRAT v. NATIONAL                        189
      INSURANCE CO. LTD. [DIPAK MISRA, J.]
    by the insured employers. Reason for this conclusion is           A
    obvious. As we have noted earlier the liability to pay
    compensation under the Workmen's Compensation Act
    gets foisted on the employer provided it is shown that the
    workman concerned suffered from personal injurv. fatal or
    otherwise. by any motor accident arising out of and in the        B
    course of his employment. Such an accident is also
    covered by the statutory coverage contemplated by
    Section 147 of the Motor Vehicles Act read with the
    identical provisions under the very contracts of insurance
    reflected by the policy which would make the insurance            c
    company liable to cover all such claims for compensation
    for which statutory liability is imposed on the employer
    under Section 3 read with Section 4-A of the
    Compensation Act."

                                            [Emphasis supplied]       D

Thereafter, the Bench proceeded to state thus:-

    "So far as interest is concerned it is almost automatic once
    default, on the part of the employer in paying the                E
    compensation due, takes place beyond the permissible
    limit of one month. No element of penalty is involved
    therein. It is a statutory elongation of the liability of the
    employer to make good the principal amount of
    compensation within permissible time-limit during which
    interest may not run but otherwise liability of paying interest
                                                                      F
    on delayed compensation will ipso facto follow."

Though the said decision was rendered in a different cc;>ntext,
yet we have referred to the same only to highlight the liability
of the insurer in respect of certain classes of employees.            G

     24. It is worthy to note that sub-clause (i)(c) refers to an
employee who is being carried in the vehicle covered by the
policy. Such vehicle being a goods carriage, an employee has
to be covered by the statutory policy. On an apposite reading         H
    190       SUPREME COURT REPORTS               [2012] 13 S.C.R.


A of Sections 147 and 167 the intendment of the Legislature, as
  it appears to us, is to cover the injury to any person including
  the owner of the goods or his authorised representative carried
  in a vehicle and an employee who is carried in the said vehicle.
  It is apt to state here that the proviso commences in a different
B way. A policy is not required to cover the liability of the
  employee except an employee covered under the 1923 Act and
  that too in respect of an employee carried in a vehicle. To put
  it differently, it does not cover all kinds of employees. Thus, on
  a contextual reading of the provision, schematic analysis of the
c Act and the 1923 Act, it is quite limpid that the statutory policy
  only covers the employees of the insured, either employed or
  engaged by him in a goods carriage. It does not cover any other
  kind of employee and therefore, someone who travels not being
  an authorised agent in place of the owner of goods, and claims
D to be an employee of the owner of goods, cannot be covered
  by the statutory policy and to hold otherwise would tantamount
  to causing violence to the language employed in the Statute.
  Therefore, we conclude that the insurer would not be liable to
  indemnify the insured.

E      25. Presently, for the sake of completeness, we shall refer
  to the policy. The policy, exhibit R-2/3/A, clearly states that
  insurance is only for carriage of goods and does not cover use
  of carrying passengers other than employees not more than six
  in number coming under the purview of the 1923 Act. The
F language used in the policy reads as follows:-

          "The Policy does not cover :
                1. Use for organized racing, pace-making reliability
                trial or speed testing
G
                2. Use whilst dwaing a trailer except the towing
                (other then for reward) or any one disabled
                mechanically propelled vehicle.

                3. Use for varying passengers in the vehicle except
H
         SANJEEV KUMAR SAMRAT v. NATIONAL                       191
         INSURANCE CO. LTD. [DIPAK MISRA, J.]
             employees (other than driver) not exceeding six in         A
             number coming under the purview of Workmen's
             Compensation Act, 1923."

      On a bare reading of the aforesaid policy, there can be
no iota of doubt that the policy relates to the insured and it
                                                                        8
covers six employees (other than the driver, not exceeding six
in number) and it is statutory in nature. It neither covers any other
category of person nor does it increase any further liability in
relation to quantum.

     26. In view of the aforesaid analysis, we repel the                C
contentions raised by the learned counsel for the appellant and
as a fall-out of the same, the appeals, being sans merit, stand
dismissed without any order as to costs.

K.K.T.                                        Appeals dismissed.        D