Holding

The State cannot escape vicarious liability; it is liable for the clerk’s negligent driving because the vehicle was used for official purposes and the act was within the course of employment.

Summary

The State of Maharashtra owned a jeep that was officially used to transport employees after office hours. The authorized driver, who was intoxicated, permitted a clerk (respondent No. 4) to drive the vehicle, resulting in a collision that killed Vijay Singh. The claimants sought compensation under the Motor Vehicles Act. While the Motor Vehicles Tribunal held only the clerk liable, the Bombay High Court found the jeep was being used for official purposes and that the State was vicariously liable for the clerk’s negligence, despite the unauthorized manner of driving. On appeal, the Supreme Court affirmed the High Court, holding that an employer is liable for an employee’s negligent act performed within the scope of an authorized task, even if the act is carried out in an improper way. Consequently, the State’s appeal was dismissed and the order directing compensation was upheld.

Issues considered

Whether the State of Maharashtra is vicariously liable for the negligence of a clerk who drove a government jeep without a licence.
Whether the clerk’s act of driving the jeep was within the "course of employment" of the State.
Whether an unauthorised manner of performing an authorised act defeats the employer’s liability under the Motor Vehicles Act.

Legislation cited

Motor Vehicles Act, 1939s. 94(1), s. 94(2)
Motor Vehicles Act, 1988s. 146, s. 92A, s. 92B

Subjects

vicarious liabilitymotor vehicle accidentgovernment liabilitycourse of employmentMotor Vehicles Actcompensationunauthorised actemployer liability

Judgment

1 STATE OF MAHARASHTRA AND ORS. A
v.
KANCHANMALA VIJASING SHIRKE AND ORS.

AUGUST 22, 1995

[N.P. SINGH AND B.L. HANSARIA, JJ.) B

Motor Vehicles Act, 1988-S.146.

Motor Vehicles Act, 1939-S.94(1).

Vicmious liability-Govt. vehicle dTiven by Govt. employee though not c
the authorised d1ive1~Accident causing death of third party-State vica1iously
liable when accident is in course of employment-Govt. liable for omission
or negligence of employee even when employee acted in an unauthorised
manne~Master cannot escape liability on ground thar he had not authorised
the particular manner in which act was done. D
Vicarious liability of State-Circumstances under which State is liable.

In course of employment-Situations justifYing use of the phrase.

A jeep belonging to the State Govt. driven by respondent no. 4, a E
clerk and accompanied by the authorised driver, respondent no.3, hit a
scooter and killed its driver. A claim for Rs. 4,00,000 was made before the
claim Tribunal by respondents 1-3 alleging that respondent no. 4 was
drunk at the time of driving but drove with the consent and knowledge of
respondent no. 3 and so both respondents 3 and 4 were jointly and
severally liable to pay compensation. F

In the written statement, the State while admitting that respondent
no 4 had no licence, was drunk, had snatched the keys from the driver and
drove negligently causing the accident, diaputed the liability of the State.
The Tribunal accepted these facts relying on records and directed respon· G
dent no. 4 to pay Rs. 1,50,000 and absolved the State.

~ The High Court on appeal, while confirming the finding of the
Tribunal that respondent no. 4 was driving and caused the accident, how·
ever found from the records that there was nothing to show that respondent
no 4 snatched the keys or was drunk. The High Court also found that H
1
2 SUPREME COURT REPORTS [1995] SUPP. 3 S.C.R.
'
A respondent no 4 did not use the jeep for private purposes. Since it was year
ending there was work to be completed and employees were asked to come
to the office after dinner to do extra work. For this purpose the jeep was
sent to pick up employees from their houses. It was the driver who was
drunk and had authorised the respondent no. 4 to drive. There was no
instruction to the driver not to hand over the jeep to any other employee of
B the State. The High Court therefore held the State to be vicariously liable
and directed them to pay Rs. 2,06,600.

In Appeal to this court, the Appellant State, inter alia, contended that
respondent no. 4 was only a clerk, not authorised or required to drive and
it was only the driver who was authorised to drive. The act of the respondent
c no. 4 could not therefore bind the State since he was not driving in course
of employment and relied on Sitaram Motilal Kalal v. Santanuprasad
Jaishanker Bhatt, [1966) 3 SCR 527.

Dismissing the Appeal and upholding the order of the High Court,
D this Court

HELD : 1. The appellant State cannot escape its vicarious liability to
pay compensation to the heirs of the victim. The High Court rightly came
to the conclusion on the basis of the pleading and evidence on record, that
the jeep was used in connection with the affairs of the State and for official
E purpose. [6-F; D-E]

2. The facts of the present case disclose and demonstrate that an
authorised act was being done in an unauthorised manner. The accident·
took place when the act authorised was being performed in a mode which
may not be proper but nonetheless it was directly connected with in the
F course of employment. It was not an independent act for a purpose which
had no nexus or connection with the business of the State Government so
as to absolve Appellant State from the liability. [14-D]

llkiw v. Samuel and Ors., [1963) 1WLR991 at 998 and Stavely Iron &
G Chemical Co. Ltd. v.Jones, (1956) AC 627 (1956) 1 All ER 403, referred to.

3.1 The crucial test is whether the initial act of the employee was
expressly authorised and lawful. The employer, as in the present case the
State Govt. shall nevertheless be responsible for the manner in which the
employee, executed the authority. This is necessary to ensure so that the
H injuries caused to third parties, who are not directly involved or concerned
STATE v. K.V. SHIRKE 3

with the nature of the authority vested by the master in his servant, are not A
deprived from getting compensation. If the dispute revolves around the
mode or manner of execution of the master by the servant, the master
cannot escape the liability so far as third parties are concerned on the
ground that he had not actually authorised the particular manner in which
the act was done. In the present case, it has been established beyond doubt
that the driver of the vehicle had been fully authorised to drive the ,jeep for
B
a purpose connected with the affairs of the State and the dispute is only in
respect of the manner in which the said driver performed his duties by
allowing another employee of the state Govt., who was on official duty, to
drive the jeep, when the accident took place. Once it is established that
negligent act of the driver was in course employment, the Appellant State c
shall be liable for the same. [14-E-H; 15-A]

Pushpabai v. Ranjit Ginning Co., [1977] 3 SCR 372; Sitaram Motilal
Kalal v. Shantanuprasad Jaishankar Bhatt, [1966] 3 SCR 527; London
County Council v. Cattenno/es (Garages) Ltd., [1953] All ER 582 and
Staveley Iron & Chemical Co. Ltd. v. Jones, (1956) AC 627, referred to. D

Salmonds Law of T01ts (20th edn) pg. 458; and Halsbwys Laws of
England, 4th edn, Vol. 16, para 739, referred to.

3.2 The trend in law is to make the master liable for act which do
E
not strictly fall within the term in course of employment as ordinarily
understood. [10-G]

Pushpabai v. Ranjit Ginning Co., [1977) 3 SCR 372, referred to.

4.1. As a result of commercial and industrial growth, even motor F
accidents are on a steep rise. For no fault or contributory negligence of the
victim of such accidents, the families are deprived of their bread earners.
The juriprudence of compensation for motor accidents must develop
toward liberal approach because of mounting highway accidents. [13-A-B]

4.2. The introduction of provisions creating liability without fault
G
gives out that Parliament has provided for payment of compensation
within certain limits, ignoring the principle of fault. When even under the
law of tort, courts, have held that the employer is vicariously liable for an
unauthorised act done in an unauthorised manner, taking into considera-
tion the interest of the victims of the accident, this approach is all the more H
4 SUPREME COURT REPORTS [1995] SUPP. 3 S.C.R.

A necessary while judging the liability of the owner of the vehicle under the
statutory provisions of the M.V. Act. [13-F-G]

4.3. Courts, while judging the liability of the Central or the State
Govt. or the local authority or transport undertakings which have been
exempted from the provisions of sub-section (1) of Section 94, have to be
B more cautious while recording a finding as to whether in t~e facts and
circumstances of a particular case, the Central or State Government or
Local authority or transport undertaking in question can be held vicarious-
ly liable for any of its employees in the course of employment.
[12-G-H; 13-A]
c 5.1. If the act of the servant is not even remotely connected within the
scope of employment and is an independent act, the master shall not be
responsible because the servant is not acting in the course of his employ-
ment but has gone outside the same. [8-A-B]

5.2. A person, who is a servant, has always a personal independent
D sphere of life and at any particular time he may be acting in that sphere.
In that situation the master cannot be responsible for what he does.
[8-H; 9-A]
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7564 of
1995.
E
From the Judgment and Order dated 5.12.91 of the Bombay High
Court in First Appeal No. 890 of 1984.

S.K. Dholakia, S.M. Jadhav, Ms. Promila and AS. Bhasme for the
F Appellants.

Raju Ramachandran, Joseph Pookkatt, Dilip Pillai and P.K. Pillai for
the Respondents.

The Judgment of the Court was delivered by
G
N.P. SINGH, J. Leave granted.

This appeal has been filed on behalf of the State of Maharashtra and
others against the judgment of the High Court holding that the appellant
State shall be vicariously liable for payment of compensation to the heirs
H of the deceased, who was the victim of the accident.
.. STATE v. K.V.SHIRKE[N.P.SINGH,.T.]

On 31.3.1980 at about 10.00 P.M. an accident took place opposite
5

S.T. Divisional office, Ratnagiri in which one Vijay Singh died. At that time
A

.... the said vijay Singh was driving the scooter and the jeep which belonged
to the State Government dashed against the scooter because of which the
victim sustained serious injuries and he ultimately succumbed to those
injuries in the hospital. The appellant No. 3 was the driver of the said jeep,
B
but at the time of accident Respondent No. 4 (hereinafter referred to as
'respondent') who was then a clerk in Engineering Fishing Project Division,
Ratnagiri, was driving the jeep.

The Respondent Nos. 1 to 3 filed their claim before the Motor
vehicles Tribunal, claiming Rs. 4,00,000 as the compensation for the death C
of Vijay Singh. It was alleged that respondent was under the influence of
liquor and was driving the jeep in a rash and negligent manner which
resulted in the accident and death of Vijay Singh. It was also alleged that
the said respondent was driving the jeep with the knowledge and consent
of the appellant No. 3, the driver of the jeep, as such the appellants and D
respondent were jointly and severally liable to pay compensation for the
accident. Vijay Singh, the deceased was then aged about 35 years and was
earning Rs. 1400 to Rs. 2000 per month.

In the written statement filed on behalf of the appellants, it was
admitted that respondent was driving the jeep although he had no licence E
to drive the same. It was also admitted that he was under the influence of
liquor. However, it was pleaded on behalf of the appellants that said
respondent had snatched the keys of the jeep from the driver, appellant
No. 3, and started driving the jeep from the office premises. It was asserted
} that in that background the appellants including the State could not be held F
to be vicariously liable for the compensation to be paid to the claimants.
Respondent filed a separate written statement and denied that he was
driving the vehicle at the time of the accident and claimed that he was
sitting by the side of the driver, appellant No. 3, who was driving the _jeep.

The Tribunal on materials on record came to the conclusion that it G
was respondent who was driving the vehicle at the relevant time and he
caused the accident because of his rash and negligent driving. It was also
held that he was having no licence to drive the jeep in question. But the
Tribunal accepted the case of the appellants that said respondent had
snatched the keys of the jeep from the timer and was driving the vehicle H
6 SUPREME COURT REPORTS (1995) SUPP. 3 S.C.R.

A unauthorisedly. In this background only respondent could be held to be
liable to pay compensation to the claimants. The Tribunal directed respon-
dent to pay Rs. 1,50,000 as compensation to the claimants.

The High Court affirmed the finding of the Tribunal that it was the
respondent who was driving the jeep at the time of accident. After referring
B several materials on records including the First Information Report which
was lodged after the accident, the High Court came to the conclusion that
the case put forward on behalf of the appellants that respondent had
snatched the keys forcibly from the driver was not correct. The High Court
. pointed out that the pleadings and evidence on record clearly indicate that
c it was the year ending day, i.e. 31.3.1980 and the clerks and officers were
required to work during night time. This was at the instance of appellant
No. 2, who was the incharge of the office. :fhe evidence further disclosed
that after normal working hours of the office, the employees had gone to
their homes and wei:e required to come back after taking dinner. The jeep
D was used for bringing the employees to the office. The High Court said
that on the materials on record it was not possible to conclude that
respondent had taken the jeep for his own private purpose, on the other
hand, it had been established that the jeep was on official duty although
being driven by respondent, who had taken the charge of the vehicle under
the authority of the driver of the vehicle. The High Court pointed out from
E the records including the medical examination of the driver that he had
consumed liquor on that day and because of that he permitted respondent
to drive the vehicle that night. In this background, the State has to be held
to be vicariously liable for the accident. Thereafter the High Court directed
payment of Rs.2,06.000 as the compensation along with 12% interest per
annum payable from the date of the application till the date of
F
deposit/realisation. The State Government, the driver and respondent were
jointly and severally held liable to pay the same.

The learned counsel appearing for the appellants took a stand that
in the facts and circumstances of the present case, the State could not be
G held to be vicariously liable to pay the compensation for the acts of
respondent who was just a clerk under the State Government and was
neither authorised nor required to drive the jeep in question. The jeep had
been put in custody of the driver who alone was entitled to drive the same.
As respondent had forcibly snatched the keys from the driver and had
H caused the accident, the said respondent only should have been held to be
STATE v. K.V. SHIRKE [N.P. SINGH,J.) 7

liable for his act; his act could not bind the State because it could not be A
held that he was driving the jeep in the course of his employment so as to
saddle the liability to pay compensation on the State Government. As a
first impression, the argument looks attractive, but on proper analysis and
evaluation, according to us, it cannot be accepted. As already mentioned
above, the High Court has examined the materials on record for purpose
B
of recording the finding that the jeep was on official duty, to bring the
employees of the State Government to the office from their residences after
they had their dinner. Respondent was a clerk in the said office and was
required to be present in the office that night. The High Court has rejected
the case of the State that the said respondent had snatched the keys from
the driver. It has been found that respondent was driving the vehicle with c
the consent and under the authority of the driver of the jeep. Nothing has
been brought on the record to show that any instruction had been issued
to the driver not to hand over the vehicle to any other employee of the
State Government while on official duty. As such it has to be examined
whether in this background, it is open to the State Government to take a D
stand that the State Government shall not be vicariously liable for the act
of respondent.

The question of payment of compensation for motor accidents has
assumed great importance during the last few decades. The road accidents
have touched a new height in India as well as in other parts of the world. E
Traditionally, before court directed payment of -tort compensation, the
claimant had to establish the fault of the person causing injury or damage.
But of late, it shall appear from different judicial pronouncements that the
fau~< is being read as because of someone's negligence or carelessness.

• Same is the approach and attitude of the courts while judging the vicarious F
liability of the employer for negligence of the employee. Negligence is the
omission to do something which a reasonable man is expected to do or a
prudent man is expected not to do. Whether in the facts and circumstances
of a particular case, the person causing injury to the other was negligent
or not has to be examined on the materials produced before the Court. It
is the rule that an employer, though guilty of on fault himself, is liable for G
the damage done by the fault or negligence of his servant acting in the
course of his employment. In some case, it can be found that an employee
was doing an unauthorised act in an unauthorised but not a prohibited way.
The employer shall be liable for such act, because such employee was
acting within the scope of his employment and in so acting done something H
8 SUPREME COURT REPORTS (1995) SUPP. 3 S.C.~.

A negligent or wrongful. A master is liable even for acts which he had not
authorised provided they are so connected with acts which he has been so
authorised. On the other hand, if the act of the servant is not even remotely
connected within the scope of employment and is an independent act, the
master shall not be responsible because the servant is not acting in the
course of his employment but has gone outside. In Salmond's Law of Torts
B (Twentieth Edition) at page 458 it has been said :

"........ On the other hand it has been held that a servant who is
authorised to drive a motor-vehicle, and who permits an un-
authorised person to drive it in his place, may yet be acting within
c the scope of his employment. The act of permitting another to
drive may be a mode, albeit an improper one, of doing the
authorised work. The master may even be responsible if the servant
impliedly, and not expressly, permits an unauthorised person to
drive the vehicle, as where he leaves it unattended in such a manner
that it is reasonably foreseeable that the third party will attempt
D to drive it, at least if the driver retains notional control of the
vehicle."

In Halsbwy's Laws of England, Fourth Edition, Volume 16, para-
graph 739 it has been stated :
E ''Where the act which the employee is expressly authorised to
do is lawful, the employer is nevertheless responsible for the
manner in which the employee executes his authority. If, therefore,
the employee does the act in such a manner as to occasion injury
to a third person, the employer cannot escape liability •on the
F ground that he did not actually authorise the particular manner in
which the act was done, or even on the ground that the employee
was acting on his own behalf and not on that of his employer."

In the case of London County Council v. Cattennoles (Garages) Ltd.,
[1953) All ER 582, a workman was employed as a general garage hand, for
G moving cars by-pushing them or giving guidance to the drivers. He was not
competent to drive, had no licence, and had been forbidden to do so. He
got into a stationary van, started the engine, drove the van and went on to
the highway. On the highway he collided with the plaintiffs van. The "'
employers were held liable. A person who is a servant has always a personal
H independent sphere of life and at any particular Lime he may be acting in
STATE v. K.V. SHIRKE [N.P. SINGH, J.] 9

that sphere. In that situation, the master cannot be responsible for what he A
does. When the act of the servant causes injury to a third party the question
is not answered by merely applying the test whether the act itself is one
which the servant was ordered or forbidden to do. The employer has to
shoulder the responsibility on a wider basis. In some situation he becomes
responsible to third parties for acts which he has expressly or implicitly
B
forbidden the servant to do.

It was said in the case of Ilkiw v. Samuels and Others, [1963] 1 W.L.R.
• 991 at 998:

"...... The driver of the vehicle, Waines, was employed, as I see C
it, not only to drive, but to be in charge of his vehicle in all
circumstances during any such times as he was on duty. That means
to say that, even when he was not himself siting at the controls, he
remained in charge of the lorry, and in charge as his employers'
representative. His employers must remain liable for his negligence
as long as the vehicle was being used in the course of their business. D
As I understand the authorities, the employers escar,e liability if,
but only if, the vehicle was, at the time of the negligent act, being
used by the driver for the purpose of what has been called a "frolic"

.
of his own. That is not this case. Here, at the material time, this
vehicle was in fact being used in the course of the defendants E
business."

It was further said at page 1005 :

' ............. If, as in Ricketts' case, and in the present case, the
master puts the vehicle in the charge and control of his servant to F
be used for the purposes of the masters business, he thereby
delegates to the servant his duty so to control it that it is driven
with reasonable care while being used for that purpose; and an
express prohibition upon allowing any other person to drive it
whilst being used for that purpose is no more than a direction as G
to the mode in which the servant shall perform the duty. It is a
prohibition dealing with conduct within the sphere of employment."

... [n respect of a contention that the driver to whom the vehicle had been
entrusted for dri,~ng had no authority from employer to delegate the
driving of the vehicle to another person and because of that the employer H
10 SUPREME COURT REPORTS (1995) SUPP. 3 S.C.R.

A cannot be made vicariously liable for the negligence of some one to whom
he had purported to delegate the control of the vehicle, it was said at page
1006:

"The duty in tort of which he was in breach was, in my view, a
duty delegated to him by the defendants under his contract of
B employment, and for that breach the defendants are vicariously
liable notwithstanding that it resulted from his breach of an express
prohibition by the defendants against permitting any other person
to drive, for that prohibition did not . limit .the sphere of his
employment, but dealt with the conduct of Waines within that
c sphere."

It need not be pointed out that different considerations might arise if the
servant or some stranger was using the vehicle for purpose other than the
purpose of his master's business and the accident occurred while the
vehicle was being used for that other purpose. But once it is found and
D established that vehicle was being used for the business of the employer,
then the employer will be held vicariously liable even for the lapse, omis-
sion and negligence of his driver to whom the vehicle had been entrusted
for being driven for the business of the employer.

E
In Staveley Iron & Chemical Co. Ltd. v. Jones, [1956) AC 627
(1956) 1 All ER 403, it was said that the legislation has in no way altered
the standard of care which is required from workmen or employers or 'that
..
the standard can differ according to whether the workman is being sued
personally or his employer is being sued in respect of his acts omissions in
course of his employment.
F
In the case of Pushpabai v. Ranjit Ginning Co., [1977) 3 SCR 372, it
was said:

"We would like to point out that the recent trend in law is to
make the master liable for acts which do not strictly fall within the
G term "in course of the employment" as ordinarily understood. We
have referred to Sitaram Motilal Kalal v. Santanuprasad Jaishankar
Bhat, (supra) where this Court accepted the law laid down.by Lord
Denning in Onnrod and Another v. (supra) that the m,jner is not
only liable for the negligence of the driver if that driver is his
H servant acting in the course of his employment but also when the
STA TE i' K. V. SHIRKE [N.P. SINGH, J.] 11

driver is, v.1th the owner's consent driving the car on the owner's A
business of for the owner's purposes. This extension has been
accepted by this Court. The law as laid down by Lord Denning in
Young v. Edward Box and Co. Ltd., already referred to i.e. the first
question is to see whether the servant is liable and if the answer
is yes, the second question is to see whether the employer must
B
shoulder the servant's liability, has been uniformally accepted as
stated in Salmond Law of Torts, .15th Ed., p. 606 in Crown
Proceedings Act, 1947 and approved by the House of Lords in
Staveley Iron & Chemical Co. Ltd. v. Jones [19561 A.C. 627 and
l.C.J. Ltd. v. Shatwell, [1965) A.C. 656"
c
From the facts of Pushpabai's case (supra), it will appear that one Purshot-
tam Udeshi was travelling in a car which was driven the Manager of the
first respondent company. The car dashed against a tree resulting in the
death of purshottam. The widow and children of purshottam filed a claim
for compensation. The High Court held that the respondent-company D
could not be held vicariously liable for the act of their driver in taking
Purshottam as a passenger as the said act was neither in the course of his
employment nor under any authority whatsoever. Therefore, the respon-
dent-company was not liable to pay any compensation. It was pointed out
by this Court that recent trend in law was to make the master liable for
acts which do not strictly fall within the term "in the course of the employ- E
ment" as ordinarily understood. It was held that the respondent-company
was. vicariously liable in respect of the accident.

On behalf of the appellants reliance was placed on the judgment in
,. the case of Sitaram Motilal Kalal v. Santanuprasad Jaisha11ka1· Bhatt, AIR F
(1966) SC [1697) = [1966) 3 SCR 527. In that case the owner of the vehicle
entrusted it to A for plying as a taxi. B used to clean the taxi. He was either
employed by the owner or by A. A trained B to drive the vehicle and took
B for obtaining the licence for driving. While taking the test B caused
bodily injury to the respondent. At the time of the accident, A was not

-· present in the vehicle. On the question whether the owner was liable, it
was held in the majority judgment that the owner was not liable because
evidence did not disclose that owner had employed B to drive the taxi or
G

given him the permission to drive the taxi. However, Subba Rao, J. (as he
then was) held that the owner was liable because A did not exceed the
authority conferred on him by the owner in employing B as a servant and H
12 SUPRFME COURT REPORTS [1995] SUPP. 3 S.C.R.

A permitted him to drive the vehicle in order to obtain the licence for
assisting him as a driver, This case was considered by this Court in the case
of Pushpabai's (supra) and it was said that recent trend in law is to make
the master liable for acts which do not strictly falls within the term "in the
course of the employment" as ordinarily understood. The learned counsel
for the appellants sought to distinguish Puslzpabai's case by contending
B that therein this court accepted the unauthorised act of the driver being
within the course of employment because of his occupying 'high position
of Manager', whereas in the case at hand appellant No. 3 - the driver - was
a class IV employee. We do not think that the ratio of the case turns on
..
the position occupied by the driver. The real thrust of the decision is
c acceptance of the trend to make the master liable for acts which do not
strictly fall within the term 'in the course of employnient' as ordinarily
understood.

In view of sub-section (1) of Section 94 of the Motor Vehicles Act,
D 1939 (Section 146 of the Motor Vehicles Act, 1988) no person can use or
allow any other person to use a motor vehicle in a public place, unless there
is in force relation to the vehicle by that person, a policy of insurance
complying with the requirements of Chapter VIII. In view of sub-section
(2) of Section 94 (sub-section (2) of Section 146 of Motor Vehicles Act,
1988), the said provision is not applicable to any vehicle owned by the
E Central or State Government and used for government purposes. Sub-sec-
tion (3) vests power in the appropriate Government to exempt from the
operation of sub-section (1) of Section 94 any vehicle even owned by any
local authority of any transport undertaking. Section 94 of the old Act as
well as Section 146 of the new Act requires that a policy of insurance must
F prmide insurance against any liability to third parties incurred by the
person using the vehicle. But there is no such requirement so far the
vehicles owned by the Central or State Government are concerned and if
the exemptions are granted from operation of sub-section (1) of Section 94
it is not incumbent even on the part ·of any local authority or any State
transport undertaking to take out insurance policy providing insurance
G against any liability to third parties incurred by the person using the vehicle.
In this background, according to us, the Courts while judging the liability
of the Central or State Government or local authorities or transport
undertakings, which have been exempted from the provision of sub-section
(1) of Section 94, have to be more cautious, while recording a finding as
H to whether in the facts and circumstances of a particular case the Central
STATE v. K.V.SHIRKE[N.P.SINGH,J.] 13

or the Stale Government or the local authority of the transport undertaking A
in question can be held vicariously liable for any act of its employee in the
course of employment. As a result of commercial and industrial growth,
even motor accidents are on steep rise. For no fault or any contributory
negligence of the victims of such accidents, the families are deprived of
their bread earners. The jurisprudence of compensation for motor acci-
B
dents must develop towards liberal approach, because of mounting highway
accidents.

Incidentally, it may be pointed out that in Motor Vehicles Act, 1939,
Chapter VII A "liability without fault in certain cases" has been introduced
(Chapter X of the Motor Vehicles Act, 1988) . Sub-section (1) of Section C
92A provides that where the death or permanent disablement of any person
has resulted from an accident arising out of the use of a motor vehicle, the
owner of the vehicle shall be liable to pay compensation in respect of such
death or disablement in· accordance with the provisions of the said Section.
Sub-section (2) specifies a fixed amount for such liability without fault. In D
view of sub-section (3), the claimant is not required to plead and establish
that the death or permanent disablement in respect of which the claim has
been made was due to any wrongful act, neglect or default of the owner of
the vehicle. Sub-section (4) of that Section says in clear and unambiguous
words that a claim for compensation under sub-section (1) of that section E
shall not be defeated by reason of any wrongful act, neglect or default of
the person in respect of whose death of permanent disablement the claim
has been made. Section 92B clarifies that the right to claim compensation
under Section 92A in respect of death or permanent disablement of any
person shall be in addition to any other right i.e. the right to claim
compensation on principle of fault. The introduction of provisions creating F
liability without fault gives out that the Parliament has provided for pay-
ment of compensation within certain limits, ignoring the principle of fault.
When even under the law of tort, courts ha\'e held that the employer is
vicariously liable for an authorised act done in an unauthorised manner
taking into consideration the interest of the victims of the accident, accord- G
ing to us, this approach is all the more necessary while judging the liability
;;,f the owner of the vehicle under the Statutory provisions of the Motor
Vehicles Act.

So far the facts of the present case are concerned, the High Court H
14 SUPREME COURT REPORTS [1995) SUPP. 3 S.C.R.

A has rightly come to the conclusion, on basis ot the pleadings and evidence
on record, that it was the year ending day e.i. 31.3.1980 and the clerks and
officers were required to work during night time. This direction had been
given by the appellant No. 2 who was incharge of the office. It further
appears that after normal working hours of the office, the employees had
B gone to their homes and were required to come back after taking dinner.
The jeep was used for bringing such employees to the office. In this
background, there is no escape from conclusion that jeep was being used
in connection with the affairs of the State and for official purpose. The
High Court has also found that respondent who was the clerk in the office
of appellant No. 2 was driving the vehicle under the authority of the driver
c who was in charge of the said vehicle and as the driver had consumed more
liquor on that day he permitted respondent to drive the vehicle that night.
The facts of the present case disclose and demonstrate that an authorised
act was being done in an unauthorised manner. The accident took place
when the act authorised was being performed in a triode which may not be
D proper but nonetheless it was. directly connected with 'in the course of
e1:11ployment' - it was not an independent act for a purpose or business
which had no nexus or connection with the business of the State Govern-
ment so as to absolve the appellant State from the liability.

E The crucial test is whether the initial act of the employee was
expressly authorised and lawfuL The employer, as in the present case the
State Government, shall nevertheless be responsible for the manner in
which the employee, that is, the driver and the respondent executed the
authority. This is necessary to ensure so that the injuries caused to third
F parties who· are not directly involved or concerne.d with the nature of
authority vested by the master to his servant are not deprived from getting
compensation. If the dispute revolves around the mode or manner of
execution of the authority of the master by the servant, the master cannot
escape the liability so far third parties are concerned on the ground that
he had not actually authorised the particular manner in which the act was
G done. In the present case, it has been established beyond doubt that the
driver of the vehicles had been fully authorised to drive the jeep for a
purpose connected with the affair of the state and the dispute is only in
respect of the manner and the mode in which the said driver performed
his duties by allowing another employee of the State Government, who was
H also going on an official duty, to drive the jeep, when the accident took
STATE v. K.V.SHIRKE[N.P.SINGH,J.) 15

place. Once it is established that negligent act of the driver and respondent A
was 'in the course of employment', the appellant State shall be liable for
the same.

We are of the view that the appellant State cannot escape its
vicarious liability to pay compensation to the heirs of the victim. The appeal
is accordingly dismissed. there shall be no orders as to cost. B
l.M.A. Appeal dismissed.

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