JUDGMENT Prakash Krishna, J.
1. This is an appeal under Section 110-D of the Motor Vehicles Act, 1939. Respondent Nos. 1 and 2 filed Claim Petition No. 120 of 1978 before the Claims Tribunal, Allahabad, on the allegations that minibus No. MP 9866 owned by the present appellant insured with New India Assurance Co. Ltd. hit their minor son Brahm Prakash on 24.2.1978, who died on account of rash and negligent driving of the aforesaid minibus. A sum of Rs. 50,000 was claimed as compensation. The said claim petition was contested by the present appellant who is the owner of the said minibus, as also by the insurance company, respondent No. 3, in the appeal. The case of the insurance company was that the said minibus was owned by Ali Ahmad & Sons and on 18.6.1977 the insurance policy was issued by it insuring Ali Ahmad & Sons for a period of one year. Before the date of the accident the said vehicle was transferred by Ali Ahmad & Sons in favour of the present appellant and as such the insurance policy ceased to exist.
2. On the basis of the pleadings of the parties, six issues were framed by the Claims Tribunal. The claim petition was allowed in part and a sum of Rs. 15,100 was awarded by way of compensation against the present appellant only with costs and simple interest from the date of making claim till the payment, at the rate of 6 per cent per annum. Feeling aggrieved against the aforesaid judgment and award dated 24.2.1981, the present appeal is at the instance of the owner of the vehicle.
3. In the memo of appeal 11 grounds have been raised but during the course of the argument, the learned Counsel for the appellant pressed the appeal only on one point.
4. The contention of the learned Counsel for the appellant is that the judgment of the court below holding that on account of transfer of vehicle during continuance of period covered under the insurance policy, the insurance policy has come to an end and will not indemnify the transferee in respect of a third party with respect to a road accident, is illegal and contrary to law. No other point has been pressed in the appeal.
5. The Claims Tribunal has decided the aforesaid controversy under issue Nos. 4 and 5. Indisputably Ali Ahmad & Sons was the owner of the vehicle in question and had obtained the insurance of the vehicle from 18.6.1977 to 17.6.1978. The accident took place in between the aforesaid period, i.e., on 24.2.1978. On these admitted facts, the Tribunal held that as the liability arose during the ownership of the present appellant who is transferee and not during the ownership of Ali Ahmad & Sons, the insurer is not liable to bear the loss or damage under the policy of insurance. The relevant portion from the order of the court below is reproduced herein-below:
As I have discussed above, the contract of the insurance company was with Ali Ahmad & Sons and not with Dhirendra Bharti, opposite party No. 1 and so the insurer is not liable for liabilities arising from the accident in question. The policy did not cover the risk of the vehicle in question in the hands of opposite party No. 1 on the date of accident. The insurer is as such not liable to reimburse the award that may be passed against opposite party No. 1, the present owner of the vehicle.
6. Challenging the legality and validity of the aforesaid finding in the present appeal the learned Counsel for the appellant submitted that in view of the authoritative pronouncement by the Apex Court in New India Assurance Co. Ltd. v. Sheela Rani , the view of the court below is not in consonance of the provisions or scheme of the Motor Vehicles Act, 1939. In this case the Supreme Court has approved the ratio of Full Bench judgment of Andhra Pradesh High Court in Madineni Kondaiah v. Yaseen Fatima 1986 ACJ 1 (AP), wherein it was held that on perusal of Section 94, it is clear that the statute intended to give protection to a third party in respect of death or bodily injury or damages to their property while using the vehicle in a public place. Hence the insurance of the vehicle, under Section 94 read with Section 95 is made compulsory. Those two provisions do not extend the compulsory insurance to the vehicle or to the owner. In fact these two provisions made exception to protect the life or limb of the driver of the vehicle or the passenger in the vehicle except public service vehicle. Thus, it is seen the compulsory insurance is for the benefit of third parties. Hence, it is clear that the insurance policy covering three kinds of risks, i.e., person (owner), property (vehicles) and third parties is clearly in the nature of composite one. The public liability (third party liability) alone is compulsory. While considering whether the transfer of the vehicle would put an end to the policy, we must see whether such a composite policy will lapse putting an end to all the three kinds of risks undertaken by the insurance company.
7. The aforesaid dictum as laid down by Andhra Pradesh High Court has been approved by the Apex Court in New India Assurance Co. Ltd. v. Sheela Rani . In G. Govindan v. New India Assurance Co. Ltd. , the Apex Court reiterated the above legal position and observed as follows:
In other words, a victim or the legal representatives of the victim cannot be denied the compensation by the insurer on the ground that the policy was not transferred in the name of the transferee.
8. Further in para 15 of the report it has been clarified that both under the old Motor Vehicles Act, 1939 and under the new Motor Vehicles Act, 1988, the legislature was anxious to protect the third party (victim) interest. It has been observed that what was implicit in the provisions of the old Act is now made explicit under the new Act. The contrary view taken by other High Courts was not approved by the Apex Court.
9. In a recent judgment, United India Insurance Co. Ltd. v. Tilak Singh , the Supreme Court has noticed all its previous judgments on the point and concluded that the liability of insurer does not cease even if the owner or the purchaser fails to give intimation of transfer to the insurance company, as the purpose of the legislation was to protect the rights and interest of third party. In view of the authoritative pronouncements referred to above, it is crystal clear that the contrary view taken by the Tribunal in the order under appeal cannot be sustained.
10. In view of above discussion the appeal is allowed. The findings recorded by the Tribunal on issue Nos. 4 and 5 are hereby set aside and it is held that the insurance company is liable to indemnify the present appellant, i.e., the transferee of the vehicle in question.
11. While granting stay this Court by order dated 6.7.1981 directed the appellant to deposit half of the amount awarded as compensation and furnish security for the balance amount. The amount so deposited was permitted to be withdrawn by the claimant-respondent without furnishing any security. It is made clear that if the aforesaid amount was deposited by the appellant, the appellant shall be entitled to recover the said amount from the insurance company along with the interest at the decreed rate. The insurance company shall be liable to pay the remaining amount to the claimant-respondent Nos. 1 and 2 along with the interest awarded by the Tribunal.
12. In the result, the appeal is allowed and the judgment and decree of the court below is modified to the extent stated above.
No order as to costs.