http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 11

PETITIONER:

SOHAN LAL PASSI

Vs.

RESPONDENT:

P. SESH REDDY & ORS.

DATE OF JUDGMENT: 17/07/1996

BENCH:

SINGH N.P. (J)

BENCH:

SINGH N.P. (J)

FAIZAN UDDIN (J)

AHMAD SAGHIR S. (J)

CITATION:

1996 SCC (5) 21 JT 1996 (6) 728

1996 SCALE (5)388

ACT:

HEADNOTE:

JUDGMENT:

J U D G M E N T

N.P. SINGH, J

Leave granted.

An accident took place on 8th June 1980 at Panaji

between a bus bearing No. DLP-5843 and scooter bearing No.

GDC-9713, as a result whereof one Dr. P. Ramachandra Reddy

who was driving the scooter fell down and succumbed to the

injuries, the same day. A claim petition was filed before

the Motor Accident Claims Tribunal by respondent Nos. 1 and

2 claiming compensation. The appellant is the owner of the

bus which had been insured by respondent No.3, the Oriental

Fire and General Insurance Company Limited (hereinafter

referred to as the 'Insurance Company').

According to the claimants, the respondent No.4,

Rajinder Pal Singh who was the cleaner/conductor of the bus

was driving the bus at the relevant time when the accident

took place resulting into the death of Dr.P. Ramachandra

Reddy, on account of his rash and negligent driving. The

claim for compensation was resisted by the appellant (owner

of the vehicle) contending that when the accident took

place, the bus was driven by Gurbachan Singh who was

employed by him as a driver and who had the licence to drive

the bus in question and as such the respondent Insurance

Company was liable to pay the compensation. The Insurance

Company, however, took the defence that as the bus was being

driven by respondent No.4, Rajinder Pal Singh, cleaner/

conductor of the bus who was not holding the driving licence

and, therefore, the Insurance Company cannot be held liable

to pay compensation because under the terms of the policy

only person holding a driving licence could have driven the

bus in question.

The Tribunal on consideration of materials on rash and

negligent driving of the bus by respondent No.4 who did not

have a driving licence. On that finding the Tribunal

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 11

discharged the liability of the Insurance Company and

directed the owner and the driver i.e. appellant and

respondent No.4 to pay an amount of Rs. 66,000/- along with

rate of 6% per annum to the claimants as compensation. One

appeal was filed on behalf of the claimants for enhancement

of the amount of the compensation, whereas the other appeal

was filed on behalf of the appellant along with respondent

No.4 for Setting aside the award of the Tribunal. The High

Court enhanced the amount of compensation from Rs.66,000/-

to Rs. 1,57,500/- and directed payment of interest at the

rate of 12% per annum to the claimants. In respect of the

dispute regarding the liability to pay the compensation

between the appellant the owner of the bus, vis-a-vis the

Insurance Company, the High Court came to the conclusion

that the Insurance Company was not liable because the

vehicle was being driven by a person at the time of the

accident, who was not holding a driving licence. The High

Court rejected the claim of the appellant holding that at

the time of the accident the vehicle was being driven by

Gurubachan Singh who was holding the driving licence.

From the orders of the Tribunal and the High Court, it

appears that Gurubachan Singh was the regular driver of the

bus, but at the time of the accident Rajinder Pal Singh who

was cleaner/conductor of the bus was driving the bus

obviously with the consent and authority of the regular

driver Gurubachan Singh. Gurubachan Singh was examined as a

witness on behalf of the appellant and he asserted that it

was he who was driving the bus and had not allowed Rajinder

Pal Singh, the cleaner/conductor to drive the bus when the

accident took place. But on basis of the materials on record

the Tribunal and the High Court, have rightly come to the

conclusion that Gurubachan Singh, the duly appointed driver

having licence had allowed Rajinder Pal Singh to drive the

said vehicle and it was due to rash Rajinder Pal Singh, the

accident took place resulting into the death of Dr. P.

Ramachandra Reddy.

On behalf of the appellant a stand was taken that as he

had appointed Gurubachan Singh to drive the vehicle in

question and if the said driver allowed Rajinder Pal Singh

to drive the vehicle without any authority from the

appellant then in that event the appellant shall not be

liable to pay any compensation to the heirs and legal

representatives of the victim.

In Salmond's Law of-Torts (Twentieth Edn.) 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 unauthorised person to

drive it in his place, may yet be

acting within 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 of 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 to drive it, at least

if the driver retains notional

control of the vehicle."

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 11

It has been said in Halsbury's Laws of England, Fourth Edn.,

Vol.16, paragraph 739:

"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 lability on

the 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 that connection reference can be made to the cases of

London County Council v. Cattermoles (Garages) Ltd., (1953)

2 All ER 582, Ilkiw v. Samuels (1963) 2 All ER 879; Staveley

Iron and Chemical Co. Ltd. v. Jones, (1956) 1 All ER 403 and

the case of Pushpabai; Purshottam Udeshi v. Ranjit Ginning

and Pressing Co. (P) Ltd., (1977) 2 SCC 745. The crucial

test is whether the initial act of the employee was

expressly authorised and lawful. Then the employer shall

nevertheless be responsible for the manner in which the

employees that is, the driver and the respondent no. 4

executed the authority. This is necessary to ensure so that

the injured third parties who are not directly involved or

concerned 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 done. This aspect

of the matter has been recently examined by a Bench of this

Court of which one of us (N.P. Singh, J) was a member, in

the case of State of Maharashtra & Ors. v. Kanchanmala

Vijaysing Shirke & Ors., (1995) 5 SCC 659. From the facts of

that case it shall appear that the jeep which caused the

accident belonged to the State of Maharashtra, the appellant

in that case. The regular driver of the jeep allowed

respondent No.4 of that appeal who was a clerk in the

Department of the State Government to drive the jeep when

the accident took place. The High Court in that case

recorded a finding that respondent No.4 of that appeal, was

driving the jeep while on official duty. This Court held

that a master is liable even for acts which he had not

authorised provided they are so connected with the acts

which he had authorised. If the act of the servant on the

other hand is not even remotely connected within the scops

of the 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.

It was said in the aforesaid case of State of

Maharashtra v. Kanchanmal Vijaysing Shirke (supra):

"....The High Court has also found

that the respondent who was the

clerk in the office of appellant

No.2 was driving the vehicle under

the authority of the driver who was

in charge of the said vehicle and

as the driver had consumed more

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 4 of 11

liquor on that day he permitted the

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 mode which may not

be proper but nonetheless it was

directly connected with "in the

course of employment" - it was not

an independent act for a purpose or

business which had no nexus or

connection with the business of the

State Government so as to absolve

the appellant-State from the

liability."

In the case of Pushpabai Purshottam Udeshi vs. Banjit

Ginning and Pressing Co.(P) Ltd., (1977) 2 SCC 745, 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 term

'in course or the employment' as

ordinarily understood. We have

referred to Sitaram Motilal Kalal v

Santanuprasad Jaishankar Bhatt

where this Court accepted the law

laid down by Lord Denning in Ormrod

v. Crosville Motor Services Ltd.

that the owner is not only liable

for the negligence of the driver if

that driver is his servant acting

in the course of his employment but

also when the driver is, with the

owner's consent, driving the car on

the owner's business or for the

owner's purposes. This extension

has been accepted by this Court.

The law as laid down by Lord

Denning in Young vs. 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 shoulder the

servant's liability, has been

uniformly accepted as stated in

Salmond's Law of Torts, 15th Edn.,

p.606, in Crown Proceedings Act,

1947 and approved by the House of

Lords in Staveley Iron and Chemical

Co. Ltd. vs. Jones and ICI Ltd. v.

Shatwell."

Same is the position in the present case. The appellant

had authorised Gurubachan Singh to drive the vehicle, but

Gurubachan Singh allowed Rajinder Pal Singh, the

cleaner/conductor who was also the employee of the appellant

to drive the vehicle because of which the accident took

place. It is not the stand of the appellant the Rajinder Pal

Singh was driving the vehicle without the knowledge or

consent of Gurubachan Singh, for his personal pursuit. He

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 5 of 11

was driving the bus for the business of the appellant, that

is to carry on the passengers. In this background, the

appellant cannot escape the liability so far the third

parties are concerned on the ground that he had not actually

authorised the particular manner in which the Act was done.

As it has been established that the negligent act of

Gurubachan Singh and respondent Rajinder pal Singh was "in

the course of employment" the appellant shall be liable for

the same. In the present case, 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 a

within the course of employment. It was not an independent

act for a purpose which had no nexus or connection with the

business of the appellant so as, to, absolve the appellant

from the liability.

The road accidents in India have touched a new height.

In majority of cases because of the rash and negligent

driving, innocent persons become victims of such accidents

because of which their dependants in many cases are

virtually on the streets. In this background, the question

of payment of compensation in respect of motor accidents has

assumed great importance for public as well as for courts.

Traditionally, before the Court directed payment of tort

compensation, it had to be established by the claimants that

the accident was due to the fault of the person causing

injury or damage. Now from different judicial

pronouncements, it shall appear that even in western

countries fault is being read and assumed as someone's

negligence or carelessness. The Indian Parliament, being

conscious of the magnitude of the plight the victims of the

accidents, have introduced several beneficial provisions to

protect the interest of the claimants and to enable them to

claim compensation from the owner or the insurance company

in connection with the accident. In the Motor Vehicles

Act,1939 Chapter VII-A was introduced by the Motor vehicles

(Amendment) Act, 1982. Sub-section (1) of Section 92-A

provides that where the death or permanent disablement of

any person has resulted from an accident, 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 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 filed was the result of the

wrongful act, neglect or default of the owner of the

vehicle. Sub-section (4) of that section provides that claim

for compensation under sub-section (1) of that section shall

not be defeated by reason of any wrongful act, neglect or

default of the person in respect of whose death or permanent

disablement the claim has been made. Section 92-B, makes it

clear that the right to claim compensation under Section 92-

A 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. It can be said

that Parliament by introducing the aforesaid Chapter in the

Motor Vehicles Act, 1939 provided for payment of

compensation within certain limits ignoring the principle of

fault. Same is the position in the Motor Vehicles Act, 1988

and similar provisions have been retained in Chapter X of

the said Act. In that connection, it may further be

mentioned that the Motor Vehicles Act, 1988 which repealed

the Motor Vehicles Act, 1939 and came in force w.e.f.

1.7.1989 prescribed a period of limitation for making claims

before the Tribunal in sub-section (3) of Section 166 of the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 6 of 11

Act. The said sub-section provided:

"No application for such

compensation shall be entertained

unless it is made within six months

of the occurrence of the accident.

Provided that the Claims

Tribunal may entertain the

application after the expiry of the

said period or six months but not

later than twelve months, if it is

satisfied that the applicant was

prevented by sufficient cause from

making the application in time."

As sub-section (3) of Section 166 by its proviso fixed

a limit of 12 months before which the application for

compensation must be filed, it left no discretion in the

claims Tribunal to extend the period beyond 12 months. This

used to cause hardship and injury to many claimants who

could not approach the Tribunal for compensation within the

period of 12 months from the date of the accident for one

reason or the other. The aforesaid. Sub-section (3)

ofSection 166 of the. Motor Vehicles Act, 1988 has been

omitted by Section 53 of the Motor Vehicles (Amendment) Act,

1994 which came in force w.e.f. 1.4.11. The effect of the

foresaid amendment is that there is no limitation for filing

claims before the Tribunal in respect of an accident. It can

be said that Parliament realised the grave injustice and

injury which was being caused to the heirs and legal

representatives of the victims who died in accidents by

rejecting their claim petitions only on the ground of

limitation. An other amendment which can be referred to in

this connection, which has been introduced by the aforesaid

Amendment Act of 1994 as sub-section (6) to Section 158

provides:

"As soon as any information

regarding any accident involving

death or bodily injury to any

person is recorded or report under

this section is completed by a

police officer, the officer

incharge of the police station

shall forward a copy of the same

within thirty days from the date of

recording of information or, as the

case may be, on completion of such

report to the Claims Tribunal

having jurisdiction and a copy

thereof to the concerned insurer,

and where a copy is made available

to the owner he shall also within

thirty days'of receipt of such

report, forward the same to such

Claims Tribunal and Insurer."

Because of sub-section (6) of Section 158 of the Act, the

officer incharge of the police station is enjoined to

forward a copy of information/report regarding the accident

to the Tribunal having jurisdiction. A copy thereof has also

to be forwarded to the concerned insurer. The same Amendment

Act has also substituted Sub-section (2) of Section 166

because of which an application for compensation under sub

section (1) of Section 166 now can be made, at the option of

the claimants either to the claim Tribunal having

jurisdiction over the area in which the accident occurred or

to the claims Tribunal within the local limits of whose

jurisdiction the claimant resides or carries on business or

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 7 of 11

within the local limits of whose jurisdiction the defendant

resides. Originally, such application used to be filed

before the claims Tribunal having jurisdiction over the area

in which the accident occurred. This used to cause great

hardship and in many cases it became impossible for the

claimants to approach such claims Tribunal, the distance

being beyond their reach from the place of their residence.

Some of the aforesaid significant amendments introduced

in the Motor Vehicles Act, 1939 and Motor Vehicles Act, 1988

have been referred to above only to indicate that even

Parliament is conscious that right to claim compensation by

the claimants in connection with the tor vehicles accidents

should not be defeated on technical grounds.

Now it has to be examined as to whether the insurance

company can be absolved of its liability to pay the

compensation in a case where the owner of the vehicle had

got the vehicle insured, but the accident took place when it

was being driven by a person not holding the driving

licence In the present case the accident took place when the

Motor Vehicles Act, 1939 was in force. Section 96 of that

act prescribed the duty of the insurers to satisfy the

judgments against persons insured in respect of third party

risks (the parallel provision being Section 149 in the Motor

Vehicles Act, 1988). The relevant part of Section 96

provided:

" 96. Duty of insurers to

satisfy Judgments against persons

insured in respect of third party

risks.- (1) If, after a

certificate of insurance has been

issued under sub-section (4) of

Section 95 in. favour of the person

by whom a policy has been effected,

judgment in respect of any such

liability as is required to be

covered by a policy under clause

(b) of sub-section (1) of Section

95 (being liability covered by the

terms of the policy) is obtained.

against any person insured by the

policy, then, notwithstanding that

the insurer may be entitled to

avoid or cancel or may have voided

or cancelled the policy, the

insurer shall, subject to the

provisions of this section, pay to

the person entitled to the benefit

of the decree any sum not

exceeding the sum assured- payable

thereunder, as if he were the

judgment debtor, in respect of the

liability.

(2) No sum shall be payable by

an insurer under sub section (1)

in respect of any judgment unless

before or after the commencement

of the proceedings, in which the

judgment is given the insurer had

notice through the court of the

bringing of the proceedings, or in

respect of any judgment so long as

execution is stayed thereon

pending an appeal and an insurer to

whom notice of the bringing of any

such proceeding is so given shall

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 8 of 11

be entitled to be made a party

thereto and to defend. the action

on any of the following grounds,

namely:

(a) ............

(b) that there has been a

breach of a specified condition of

the policy, being one of the

following conditions, namely:

(i) ............

(a) to (d) ........

(ii) a condition excluding

driving by a named person or

persons or by any person who this

not duly licensed, or by any person

who has been disqualified for

holding or obtaining a driving

licence during the period of

disqualification; or

......."

In view of sub-section (1) of Section 96 if after the

certificate of insurance has been issued in favour of the

person by whom a policy has been effected, judgment in

respect of any such liability as is required to be covered

by a policy, the insurer shall subject to the provisions of

the said section pay to the person entitled to the benefit

of the decree any sum not exceeding the sum assured payable

thereunder, as if he was the judgment debtor. in respect of

the liability. ( emphasis supplied ). Sub-section (2) of

Section 96 enjoins that notice of the proceedings in which

the judgment is given, has to be given to the insurer and

such insurer shall be entitled to defend the action on any

of the grounds mentioned in sub-section (2) of Section 96.

We are concerned in the present case only with Section

96(2)(b)(ii), a condition excluding driving by any person

who is not duly licensed. The question is as to whether the

insurance company can repudiate its liability to pay the

compensation in respect of the accident by a vehicle only by

showing that at the relevant time it was being driven by a

person having no licence. In the case of Skandia Insurance

Co.Ltd. vs. Kokilaben Chandravadan, 1987(2) SCC 654; in

respect of this very defence by the insurance company it was

said:

"The defence built on the

exclusion clause cannot succeed for

three reasons, viz. :

(1) On a true interpretation

of the relevant clause which

interpretation is at peace with the

conscience of Section 96, the

condition excluding driving by a

person not duly licensed is not

absolute and the promisor is

absolved once it is shown that he

has done everything in his power to

keep, honour and fulfil the promise

and he himself is not guilty of a

deliberate breach.

(2) Even if it treated as an

absolute promise, there is

substantial compliance therewith

upon an express or implied mandate

being given to the licensed driver

not to allow the vehicle to be left

unattended so that it happens to be

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 9 of 11

driven by an unlicensed driver.

(3) The exclusion clause has

to be 'read down' in order that it

is not at war with the 'main

purpose' of the provisions enacted

for the protection of victims of

accidents so that the promisor is

exculpated when he does everything

in his power to keep the promise."

To examine the correctness of the aforesaid view this appeal

was referred to a three Judges' Bench, because on behalf of

the insurance company, a stand was taken that when 'Section

96(2)(b)(ii) has provided that the insurer shall be entitled

to defend the action on the ground that there has been

breach of a specified condition to the policy i.e. the

vehicle should not be driven by a person who is 'not' duly

licensed, then the insurance company cannot be held to be

liable to indemnify the owner of the vehicle. In other

words, once there has been a contravention of the condition

prescribed in sub-section (2)(b)(ii) of Section 96, the

person insured shall not be entitled to the benefit of sub-

section (1) of Section 96. According to us, Section

96(2)(b)(ii) should not be interpreted in a technical

manner. Sub-section (2) of Section 96 only enables the

insurance company to defend itself in respect of the

liability to pay compensation on any of the grounds

mentioned in sub-section (2) including that there has been a

contravention of the condition excluding the vehicle being

driven by any person who is not duly licensed. This bar on

face of it operates on the person insured. If the person who

has got the vehicle insured has allowed the vehicle to be

driven by a person who is not duly licensed then only that

clause shall be attracted. In a case where the person who

has not insured the vehicle with the insurance company, has

appointed a duly licensed driver and if the accident takes

place when the vehicle is being driven by a person not duly

licensed on the basis of the authority of the driver duly

authorised to drive the vehicle whether the insurance

company in that event shall be absolved from its liability?

The expression "breach" occurring in Section 96(2)(b) means

infringement or violation of a promise or obligation. As

such the insurance company will have to establish that the

insured was guilty of an infringement or violation of a

promise. The insurer has also to satisfy the Tribunal or

the Court that such violation or infringement on the part of

the insured was willful, It the insured has taken all

precautions by appointing a duly licensed driver to drive

the vehicle in question and it has not been established that

lt was the insured who allowed the vehicle to be driven by a

person not duly licensed, then the insurance company cannot

repudiate its statutory liability under sub-section (1) of

Section 96. In the present case far from establishing that

it was the appellant who had allowed Rajinder Pal Singh to

drive the vehicle when the accident took place, there is not

even any allegation that it was the appellant who was guilty

of violating the condition that the vehicle shall not be

driven by a person not duly licensed. From the facts of the

case, it appears that the appellant had done everything

within his power inasmuch as he has engaged a licensed

driver Gurubachan Singh and had placed the vehicle in his

charge. While interpreting the contract of insurance, the

Tribunals and Courts have to be conscious of the fact that

right to claim compensation by heirs and legal

representatives of the victims of the accident is not

defeated on technical grounds. Unless it is established on

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 10 of 11

the materials on record that it was the insured who had

willfully violated the condition of the policy by allowing a

person not duly licensed to drive the vehicle when the

accident took place, the insurer shall be deemed to be a

judgment-debtor in respect of the liability in view of sub-

section (1) of Section 96 of the Act. It need not be

pointed out that the whole concept of getting the Vehicle

insured by an insurance company is to provide an easy mode

of getting compensation by the claimants, otherwise in

normal course they had to pursue their claim against the

owner from one forum to the other and ultimately to execute

the order of the Accident Claims Tribunal for realization of

such amount by sale of properties of the owner of the

vehicle. The procedure and result of the execution of the

decree is well known.

This Court in the case of Kashiram Yadav and Another.

vs. Oriental Fire and General Insurance Co. and Others,

(1989) 4 SCC 128 reiterataed the views expressed in Skandia

Insurance Co. Ltd. vs. Kokilaben Chandravadan (supra) while

referring to that case it was said:

".......There the facts found

were quite different. The vehicle

concerned in that case was

undisputedly entrusted to the

driver who had a valid licence. In

transit the driver stopped the

vehicle and went to fetch some

snacks from the opposite shop

leaving the engine on. The ignition

key was at the ignition lock and

not in the cabin of the truck. The

driver had asked the cleaner to

take care of the truck. In fact the

driver had left the truck in care

of the cleaner. The cleaner meddled

with the vehicle and caused the

accident. The question arose

whether the insured (owner) had

committed a breach of the condition

incorporated in the certificate of

insurance since the cleaner

operated the vehicle on he fatal

occasion without driving licence.

his Court expressed the view that

it is only when the insured himself

entrusted the vehicle to a person

who does not hold a driving

licence, he could be said to have

committed breach of the condition

of the policy. It must be

established by the Insurance

Company that the breach is on the

part of the insured. Unless the

insured is at fault and is guilty

of a breach of the condition, the

insurer cannot escape from the

obligation to indemnify the

insured. It was also observed that

when the insured has done

everything within his power

inasmuch as he has engaged the

licensed driver and has placed the

vehicle in his charge with the

express or implied mandate to

drive himself, it cannot be said

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 11 of 11

that the insured is guilty of any

breach.

We affirm and reiterate the

statement of law laid down in the

above case. We may also state that

without the knowledge of the

insured, if by driver's acts or

omission others meddle with the

vehicle and cause an accident, the

insurer would be liable to

indemnify the insured. The insurer

in such a case cannot take the

defence of a breach of the

condition in the certificate of

insurance."

We are in respectful agreement with the view expressed

in the case of Skandia Insurance Co. Ltd. vs Kokilaben

Chandravadan (supra).

As in the facts of the present case, the appellant

shall be deemed to be liable to pay compensation applying

the principle of vicarious liability because the accident

took place when the act authorised was being performed in a

mode which may not be proper but was directly connected with

in the course of employment, sub-section (1) of section 96

of the Act shall come into play and the insurance company

shall be deemed to be the judgment debtor, so far claim made

by the heirs and legal representatives of the deceased is

concerned. are

Accordingly, the appeals are allowed and the orders of

the claims Tribunal and the High Court are modified where

only the appellant has been held to be liable to pay the

compensation and the respondent insurance company has been

absolved of the liability. The respondent insurance company

shall be jointly and severally liable to pay the

compensation to the claimants. There shall be no order as to

costs.