Bhubaneswar in MAC Case No. 25 of 2018. Vide the said Judgment
Claimants-Respondent Nos. 1 to 6, held the Appellant liable to pay
realization. The Tribunal also levied default interest @ 8% per
2. While assailing the impugned judgment learned counsel appearing
Sec. 147 of the M.V. Act, 1988.
3. It is contended that the offending vehicle bearing Registration No.
Owner-Respondent No. 7 under IMT-16, IMT-29, the Appellant
3.1. It is contended that as per the terms and conditions of the policy
so issued in favour of the Owner-Respondent No. 7, since no extra
application of the Claimants-Respondents. IMT-16 & 29 reads as
Subject otherwise to the terms exceptions conditions and limitations of this
Policy.
*The Capital Sum Insured (CSI) per person is to be inserted.
IMT.29. LIBILITY TO EMPLOYEES OF THE INSURED OTHER
THAN PAID DRIVER AND / OR CONDUCTOR AND / OR CLEANER
WHO MAY BE TRAVELLING OR DRIVING IN THE EMPLOYER'S
CAR (Private Car's only/Motorised two wheelers [not for hire or reward)
In consideration of the payment of an additional premium @ Rs. 50/- per
employee insured notwithstanding anything to the contrary contained in
the Policy it is hereby understood and agreed that the Company will
'Indemnify the Insured against the Insured's liability at Common Law and
Statutory Liability under the Fatal Accidents Act, 1855 for compensation
(including legal costs of any claimant) for death of or bodily injury to any
employee (other than paid drivers) of the within named Insured being
carried in or upon or entering in or getting on to or alighting from or
driving the vehicle insured.
Provided that in the event of an accident whilst the vehicle insured is
carrying more than employees of the Insured (including the driver) the
Insured shall repay to the Company a rateable proportion of the total
amount payable by the Company by the reason of this endorsement in
respect of accident in connection with such vehicle insured.
Subject otherwise to the terms, conditions limitations and exceptions of
this policy.
NB. *To insert the number of employees for which the premium has been
paid."
3.2. It is also contended that though it is not disputed that the policy
3.3. In support of his aforesaid submission reliance was placed to a
(Oriental Insurance Co. Ltd. Vs. Meena Variyal & Ors.). Hon'ble
26)
"... that the meaning of the words 'any person' must also
be attributed having regard to the context in which they have
been used i.e. 'a third party'. Keeping in view the provisions
of the 1988 Act, we are of the opinion that as the provisions
thereof 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, the insurers would not be liable therefor."
// 9 //
In other words, this Court clearly held that the apparently
wide words "any person" are qualified by the setting in
which they occur and that "any person" is to be understood
as a third party."
3.4. Reliance was also placed to a Division Bench decision of the
Madras High Court in the case of United India Insurance Co. Ltd.
Vs. R. Krishnan (CMA No. 2307 of 2018 & batch) disposed of on
23.03.2020. Madras High Court in Para 19.2, 19.3, 20.1, 20.2, 20.3,
20.4, 20.5, 20.6.1, 20.6.2, 20.7, 20.8, 20.9, 20.10 & 20.11 has held as
follows:-
"19.2 IMT-16 is relating to the premium paid to cover the
present accident to unnamed passengers other than the insured
and the paid driver and the cleaner. Now, the issue to be
decided herein is that, who are the persons to be covered
under the category of unnamed passengers, in terms of IMT-
16.
19.3 As per the IMT-16, all the passengers would be
covered other than the following:-
i) insured and/or
ii) the paid driver attendant or cleaner; and/or
iii) a person in the employ of the insured coming within the
scope of the Workmens Compensation Act, 1923 and
subsequent amendments of the said Act and
iv) engaged in and upon the service of the insured at the time
such injury is sustained whilst mounting into
xxx xxx xxx
// 10 //
20.1 As far as fifth issue is concerned, now we have to decide
whether the owner of the vehicle is liable to pay additional
premium to cover its employees in terms of IMT-29? To
answer this issue it is relevant to extract the IMT-29 as
follows:
"IMT-29 Legal Liability to Employees of the Insured other
than paid driver and/or conductor and /or cleaner who
may be travelling or driving in the employer's car (Private
cars only/Motorized two wheelers (not for hire or reward)
"In consideration of the payment of an additional
http://www.judis.nic.in and 586 of 2019 premium @
Rs.25/- per employee insured notwithstanding anything to
the contrary contained in the policy it is hereby
understood and agreed that the insurer will indemnify the
insured against the insured's liability at Common Law and
Statutory Liability under the Fatal Accidents Act, 1855 for
compensation (including legal costs of any claimant) for
death of or bodily injury to any employee (other than paid
drivers) of the within named insured being carried in or
upon or entering in or getting on to or alighting from or
driving the vehicle insured. Provided that in the event of
an accident whilst the vehicle insured is carrying more
that ...* employees of the insured (including the driver)
the insured shall repay to the insurer a rateable
proportion of the total amount payable by the insurer by
the reason of this endorsement in respect of accident in
connection with such vehicle insured. Subject otherwise to
the terms, condition limitations and exception of this
policy."
20.2. The IMT-29 is relating to the payment of additional
premium to cover the liability to employees of the insured
other than the paid drivers/conductors/cleaners.
// 11 //
20.3 The terms and conditions of Section II-Liability to third
parties, as stated above, clearly excludes payment of
compensation to the employees of the insured under the
category of third party liability. Section II ultimately provides
that third party liabilities would be covered as provided
under Section 147 of the M.V. Act. Section 147 of the M.V. Act,
clearly spells out that premium paid by the insured would
cover only the statutory liabilities as stated thereunder,
excluding the liabilities to the employees of the insured.
Therefore, under Section 147 of M.V. Act, it is mandatory for
the insured to enter into a private contract with the insurer by
way of payment of additional premium to cover its employees.
20.4 The premium paid under basic third party liability does
not cover the employees of the insured. As we stated earlier,
additional premium paid under IMT-16 to cover unnamed
passengers also excludes employees of the insured from any
coverage. Therefore, in order to cover the employees of the
insured, the insured is required to pay additional premium in
terms of IMT-29.
20.5 This Court vide orders dated 05.09.2019 and 23.09.2019
directed the IRDA to answer the following queries:
"(i) Whether the Insurance Company is liable to
http://www.judis.nic.in and 586 of 2019 pay compensation to
the occupant in a private car without paying additional
premium under IMT-29?
(ii) What is the scope of IMT-29 after the issuance of circular
dated 3 December 2009, by IRDA."?
20.6.1 As far as first query is concerned, the IRDA submits that
the Insurance Company will not be liable to pay compensation
in an accident for the occupants in the private car, who are
employees of the insured/owner travelling without obtaining
coverage under IMT-29.
20.6.2 As far as second query is concerned, the IRDA
answered that the circular, dated 03.12.2009 was not intended
to modify the policy terms or include coverage for
employee/occupant but only to deal with dispute being raised
by the insurer for all occupants (other than
employees/occupants) contrary to the express wording of the
policy.
20.7 Thus, from the memo filed by IRDA dated 30.09.2019, it is
clear that insurer will not have liability for occupants in a
private car, who are employees of the insured/owner (except
the paid driver) without obtaining coverage under IMT-29.
// 12 //
20.8 Therefore, if an employer intends to cover its employees,
it is mandatory for the employer to pay additional premium in
terms of IMT-29. In the event of non payment of any additional
premium, in terms of IMT-29, insurance coverage will not be
extended to its employees. In the present case, admittedly, no
additional premium was paid under IMT-29 to cover the
employees of the insured. Therefore, without payment of
additional premium certainly, the employees are not entitled to
make any claim under the pretext that the policy issued by the
insurer was a comprehensive/package policy.
20.9 At the time of argument, the learned Senior Counsel,
Mr.M.S.Krishnan made a submission that issue relating to
applicability of IMT-29 has been raised for the first time
before this Court. Had they raised this issue at the time of trial,
they would have had a chance to examine whether the claimant
was travelling as employee in the course of employment. We
do http://www.judis.nic.in and 586 of 2019 not find any force
in the said submission of learned Senior Counsel as there is no
requirement to raise the said issue now since the claimant had
filed claim statement stating that the accident occurred, when
he was travelling in a Bollero Jeep after visiting his work site
at Joda towards Bhubaneswar. Corroborating the same, P.W.1
and P.W.2 also deposed evidence. The said averment was not
disproved by the Thriveni. Further, at the time of chief
examination, R.W.1 has clearly deposed about the difference
between IMT-28 and IMT-29. Therefore, even at the time of
examination of witnesses, the issue relating to the applicability
of IMT-29 was raised. It is only the insured, who failed to
cross- examine R.W.1. in this aspect. Therefore, the contention
of the learned Senior Counsel that for the first time, the
applicability of IMT-29 has been raised before this Court does
not have any merit. Therefore, we are of the considered view
that, in the present case, no additional premium was paid
under IMT-29 to cover the employees of the insured.
20.10 At this juncture, it would be appropriate to deal with
various case laws cited by Mr.M.S.Krishnan, learned Senior
Counsel appearing for the owner of the vehicle. The learned
Senior counsel referred mainly the latest decision of the
Hon'ble Supreme Court in the case of New India Assurance
http://www.judis.nic.in and 586 of 2019 Company Vs. Shanti
Bopanna and other (supra). By referring the above case, the
learned Senior Counsel contended that the Hon'ble Supreme
Court has categorically held that the employees will be
covered under the comprehensive policy. In the present case,
since the Policy issued is under the comprehensive/package
policy, he contended that the said case is squarely applicable
for the present case. However, on the perusal of the above
judgment, it is clear that the additional premium payable in
// 13 //
terms of IMT-29 to cover the legal liabilities to the employees
of the insured other than paid driver had not been brought into
the knowledge of the Hon'ble Supreme Court. Since the
counsels failed to bring into the knowledge of the Hon'ble
Supreme Court, the Hon'ble Supreme Court had no occasion
to deal with about the applicability of IMT-29. The finding of
the Hon'ble Apex Court in Shanti Bopanna case (supra) was
made without testing the requirement of payment of additional
premium by the employer to cover its employees under IMT-
29. Therefore, we are of the view that the principles laid down
by the Hon'ble Apex Court in the Shanti Bopanna case will not
be applicable to the case on hand.
20.11 In all other cases, as referred by both the parties, there
was no finding on the aspect of applicability of IMT-29.
Therefore, all the above cases http://www.judis.nic.in and 586
of 2019 referred by the learned Senior counsel appearing for
the owner of the vehicle will not be applicable for the present
case. In fine, we hold that in the present case, owner of the
vehicle is liable to pay additonal premium under IMT-29, to
cover its employees. Obviously, no additional premium was
paid in terms of IMT-29. Hence, we are of the view that the
insurance company is not liable to pay compensation as
awarded by the Tribunal. Accordingly, Issue No.5 is
answered."
3.5. It is also contended that challenge made to the Judgment passed
by the Madras High Court before the Hon'ble Apex Court in Special
Leave to Appeal (Civil) No. 7529 of 2020 was also dismissed vide
order dtd.03.08.2022. It is accordingly contended that in view of
non-payment of any premium under IMT-16 & 29 and the policy
being a Private Car Comprehensive Policy, the Appellant is not
liable to pay any compensation as has been allowed vide the
impugned judgment and the same is not sustainable in the eye of law.
4. Mr. P.K. Mishra, learned counsel appearing for the Owner-
Respondent No. 7 on the other hand contended that since the policy
// 14 //
in question is a private car comprehensive policy and there is no
violation of any policy condition, challenge made by the Appellant to
the impugned judgment is not sustainable in the eye of law.
4.1. It is contended that since the policy is a private car
comprehensive policy and the deceased was travelling in the vehicle
as an occupant and while proceeding as such, he met with the
accident and died accordingly, the Appellant is liable to pay the
compensation as awarded.
4.2. It is also contended that there is no dispute that the accident took
place due to the rash and negligent driving of the driver of the
offending vehicle and such overt act of the driver of the offending
vehicle has been clearly proved by P.W. 1 & 2.
4.3. Since the driver of the offending vehicle was having valid D.L.
and the vehicle was duly insured under the Private Care
Comprehensive Package Policy, such a policy covers the risk of the
occupants. The Claimants being the legal heirs of the deceased
occupant, being a 3rd Party, are entitled to get the compensation. In
support of the same, reliance was place to a decision of the Hon'ble
Apex Court in the case of National Insurance Co. Ltd. Vs.
// 15 //
Balkrishnan & Anr. (2013) 1 TAC (1). Hon'ble Apex Court in Para
20 & 21 of the said Judgment has held as follows:-
"20. It is also worthy to note that the High Court, after referring
to individual circulars issued by various insurance companies,
eventually stated [2011 ACJ 1415 (Del)] thus: (Yashpal Luthra
case [2011 ACJ 1415 (Del)] , ACJ p. 1424, para 27)
"27. In view of the aforesaid, it is clear that the
comprehensive/package policy of a two-wheeler covers a pillion
rider and comprehensive/package policy of a private car covers
the occupants and where the vehicle is covered under a
comprehensive/package policy, there is no need for the Motor
Accidents Claims Tribunal to go into the question whether the
insurance company is liable to compensate for the death or
injury of a pillion rider on a two-wheeler or the occupants in a
private car. In fact, in view of the TAC's directives and those of
the IRDA, such a plea was not permissible and ought not to have
been raised as, for instance, it was done in the present case."
21. In view of the aforesaid factual position, there is no
scintilla of doubt that a "comprehensive/package policy" would
cover the liability of the insurer for payment of compensation
for the occupant in a car. There is no cavil that an "Act policy"
stands on a different footing from a "comprehensive/package
policy". As the circulars have made the position very clear and
IRDA, which is presently the statutory authority, has
commanded the insurance companies stating that a
"comprehensive/package policy" covers the liability, there
cannot be any dispute in that regard. We may hasten to clarify
that the earlier pronouncements were rendered in respect of the
"Act policy" which admittedly cannot cover a third-party risk of
an occupant in a car. But, if the policy is a
"comprehensive/package policy", the liability would be
covered. These aspects were not noticed
in Bhagyalakshmi [(2009) 7 SCC 148 : (2009) 3 SCC (Civ) 87 :
(2009) 3 SCC (Cri) 321] and, therefore, the matter was referred
to a larger Bench. We are disposed to think that there is no
necessity to refer the present matter to a larger Bench as IRDA,
// 16 //
which is presently the statutory authority, has clarified the
position by issuing circulars which have been reproduced in the
judgment by the Delhi High Court and we have also reproduced
the same."
4.4. It is accordingly contended that since the deceased was an
occupant in the vehicle, which is not disputed, in view of the
decision in the case of Balkrishnan as cited (supra), no illegality or
irregularity can be found with the impugned judgment.
5. Mr. B.B. Singh, learned counsel appearing for the Claimants-
Respondent Nos. 1 & 3 to 6 also made similar submission as made
by the learned counsel appearing for the Owner-Respondent. In
addition to the submission made by the learned counsel appearing for
the Respondent-Owner, learned counsel appearing for the Claimants-
Respondents contended that the decision rendered by the Madras
High Court by the Appellant is not applicable to the facts of the
present case as in the said case the offending vehicle was registered
in the name of the Company and the policy was also issued in favour
of the Company. Accordingly, provisions of IMT-16 & IMT-29 were
made applicable to the facts of the said case.
5.1. Since the present case, the deceased was travelling in the
offending vehicle as an occupant and since the accident occurred due
to rash and negligent driving of the driver, which is well proved by
// 17 //
P.W. 1 & 2, eye witnesses to the occurrence, in view of the decision
rendered in the case of Balkrishnan as cited (supra), the Appellant is
liable to pay the compensation.
5.2. Reliance however was also placed to another decision of the
Hon'ble Apex Court reported in (2018) I TAC 12 (SC) (New India
Assurance Co. Ltd. Vs. Shanti Bopannah & Ors.). Hon'ble Apex
Court in Para 7 & 8 of the said judgment has held as follows:-
"7. The clause of the policy reproduced above clearly covers
the insured against all sums which the insurer may become
liable to pay in respect of:
"(i) death of or bodily injury to any person including
occupants carried in the vehicle (provided such occupants are
not carried for hire or reward)...."
8. We thus find that the claim of the widow and the adopted
son is fully covered by the clause in the insurance contract,
i.e., the policy and there is no scope for acceding to the
submission made on behalf of the appellant-company that the
claim is excepted by virtue of the provisions of Section 147 (1)
of 1) of the Act in this case. We, therefore, reject the contention
made on behalf of the applicant that the deceased was not a
third party because he was an employee sitting in the car. It is
obvious from the circumstances that the deceased was indeed a
third party being neither the insurer not the insured."
// 18 //
5.3. Learned counsel appearing for the Claimants-Respondents
accordingly contended that no interference is called for with the
impugned judgment.
6. Having heard learned counsel appearing for the Parties,
considering the submissions made and after going though the
materials available on record, this Court finds that the deceased died
due to a road accident caused on 18.01.2018. It is not disputed that
the offending vehicle bearing Registration No. OD-33-K-6310 was
insured with the Appellant-Company with issuance of a policy in the
name and style 'Private Car Comprehensive Policy'. It is not the case
of the Appellant that the deceased died due to his own negligence in
any manner.
6.1. Since the policy in question is a private car comprehensive
policy and the deceased was an occupant in the said vehicle, placing
reliance on the decision in the case of Shanti Bopannah as well as
Balkrishnan as cited (supra), it is the view of this Court that
Appellant-Company is liable to pay the compensation so awarded
vide the impugned judgment. Decisions relied on by the learned
counsel appearing for the Appellant as per the considered view of
this Court, is not applicable to the facts of the present case.
// 19 //
6.2. However, considering the submission made by the learned
counsel for the Appellant as well as the Claimants-Respondents, this
Court while not interfering with the impugned award, held the
Claimants-Respondents entitled to get the awarded compensation
amount. However, this Court is inclined to waive out the penal
interest levied @ 8%. While holding so, this Court directs the
Appellant-Company to deposit the awarded compensation amount
of Rs.32,54,000/- along with interest payable @ 6% per annum from
the date of filing of the application till its realization within a period
of eight (8) weeks from the date of receipt of this order. On such
deposit of the amount, the Tribunal shall disburse the same in favour
of the Claimants-Respondents in full in terms of the Judgment
passed on 03.05.2023.
6.3. However, it is observed that if the amount as directed will not
be deposited by the Appellant-Company within the aforesaid time
period of eight (8) weeks, the compensation amount of
Rs.32,54,000/- shall carry interest @ 7% per annum for the period
starting from the expiry of the period of eight (8) weeks till its
payment.
6.4. It is observed that the account payee cheque not yet invested, be
returned back to the Appellant-Company, after satisfaction of the
award.
7. The appeal is disposed of accordingly.
(BIRAJA PRASANNA SATAPATHY)
Signed by: SNEHANJALI PARIDA Judge
Reason: Authentication
Location: High Court ofOrissa
Orissa, High
Court Court, Cuttack
Date: 23-Jun-2025 18:22:55 th
The 19 June, 2025/Sneha
