Telangana High Court: If Motor Vehicle at the time of accident was in the breach of ‘purpose of use’ as per policy, the insurance company would not be liable

Telangana High Court in the case M/S. United India Insurance Co LTD v. Sri Rama Swamy & 2 Or’s held that if the accident was in the breach of terms and purpose of the insurance policy. The court ruled that the insurance company is not liable to pay compensation under Motor Vehicles Act.

It was presented before the Court that the tractor fell in a road side ditch due to which one of the labourers died on the spot, one day while the deceased along with the other laborers were proceeding with the tractor and trailer from one village to another. A deceased name Padma was working as a labourer in the employment of the owner of the Tractor and the trailer.

An appealed filled by the aggrieved the appellant i.e., the M/S United India Insurance Company Limited of an order dated 07.12.26 passed by the Commissioner of Labour for workmen Compensation.

The Bench of Justice P. Sree Sudha that though the deceased and injured were labourers but the deceased and the injured were not working as the with the owner of the Tractor and Trailor and there was no employer and employee relationship between them and the accident had not occurred during the course of employment since after attending the labour work in a Tractor along with the marriage party and then they met with an accident.

The Bench observed the issue that even if the claimants have not established the employer employee relationship between the deceased and the opposite party and in the course of employment the accident has not taken up place during and in the course of employment the issue involve weather the commissioner was justified in awarding the compensation.

At the time of the accident the goods carrying vehicle was carrying a marriage party with nearly twenty-five persons and thus the owner of the vehicle violated the terms of policy and thus was not liable to indemnify the owner. The Insurance policy coverage was only at the time of loading and unloading operations for five coolies.

The commissioner held that the claimants in this appeal are the husband and the minor son of the deceased. She met with an accident while she was returning from work along with other labourers and subsequently, she died while undergoing treatment, the accident occurred during the course of employment. The commissioner has also observed that the premium was collected to cover the risk of five labourers under the Act.

The appeal made by the Insurance Company was allowed and it amounted to the breach of terms and conditions of the policy and the insurance company weas not liable to pay the Compensation under the Workmen Compensation Act.

Any miscellaneous application pending in this appeal shall be stand closed in the light of this final order given by the Court.

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