ROAD TRANSPORT COMPANY versus BHAN SINGH AND ANR.

ROAD TRANSPORT COMPANY versus BHAN SINGH AND ANR.

The insurance company's liability is statutorily capped at Rs. 5,000 per passenger and Rs. 75,000 in aggregate for a bus registered to carry more than 30 but not more than 60 passengers. The payment of an additional premium of Rs. 300, calculated as Rs. 6 per passenger for 50 passengers, was intended to cover only this statutory liability and not to extend or create unlimited liability in the absence of a special contract. The policy language and endorsements confirm no such special unlimited coverage agreement exists.

Parties
Appellant: Road Transport Company; Respondent: Bhan Singh; Respondent: Another (unspecified)
Jurisdiction
India
Judgment Date
22 July 1998
Procedural Posture
Civil Appeal / Supreme Court Decision on Appeal Against High Court Judgment and Review Petitions
Outcome
Appeal dismissed
Legal Topics
Insurance Policy Coverage, Statutory Liability Limits, Motor Vehicle Accident Compensation, Comprehensive Vs. Act Only Policy
Insurance Law Motor Vehicle Law Tort Law Insurance Policy Coverage Statutory Liability Limits Motor Vehicle Accident Compensation Comprehensive Vs. Act Only Policy

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Parties

Road Transport Company

Appellant

Bhan Singh

Respondent

Another (unspecified)

Respondent

Procedural Posture

Civil Appeal / Supreme Court Decision on Appeal Against High Court Judgment and Review Petitions

Legal Issues

  1. 1 Whether payment of additional premium under a comprehensive insurance policy increases the insurer's liability beyond the statutory limits for passenger claims under the Motor Vehicles Act, 1939
  2. 2 Whether the insurer's liability is limited to Rs. 5,000 per passenger and Rs. 75,000 in all despite an additional premium payment

Ratio Decidendi

The insurance company's liability is statutorily capped at Rs. 5,000 per passenger and Rs. 75,000 in aggregate for a bus registered to carry more than 30 but not more than 60 passengers. The payment of an additional premium of Rs. 300, calculated as Rs. 6 per passenger for 50 passengers, was intended to cover only this statutory liability and not to extend or create unlimited liability in the absence of a special contract. The policy language and endorsements confirm no such special unlimited coverage agreement exists.

Court Disposition

Appeal dismissed

Orders

  • The insurance company's liability remains limited to Rs. 5,000 per passenger and Rs. 75,000 in all.
  • No order as to costs.