PETITIONER: <NAME> AND ANOTHER Vs. RESPONDENT: <NAME> AND ANOTHER DATE OF JUDGMENT28/01/1977 BENCH: KAILASAM, P.S. BENCH: KAILASAM, P.S. RAY, <NAME>, <NAME> CITATION: 1977 AIR 1248 1977 SCR (2) 886 1977 SCC (2) 441 CITATOR INFO : R 1979 SC1862 (17) E 1987 SC1690 (6) ACT: Motor Vehicles Act , 1939--S. 95(v) (b) (i) and (ii)--Scope of--Claim for compensation in motor vehicle accidents Proof of negligence of driver--If necessary. Torts--Claim for compensation in motor vehicle acci- dents--Proof of negligence of driver--If necessary. HEADNOTE: While the respondent was travelling in his car, the appel- lant's truck, driven by a driver, hit the car and caused injuries to the respondent and damaged the car. <ORG> awarded compensation to the respondent, and <ORG> upheld the <ORG>'s award. In the course of the judgment <ORG>, however, observed that every person has a right to security and safety of his person irrespective of the fault or negligence or carelessness and that every person has a right to claim compensation, irre- spective of proof of negligence on the part of the driver. It further observed that the perimeters of liability in cls. (i) and (ii) of s. 95(1)(b) must be held to be the same because in both, the liability of the owner of the driver exists and is made compulsorily insurable and that it could not be said that the legislature intended absolute liability in cases covered by cl. (ii) and not in cases covered by cl. (i). HELD: Proof of negligence is necessary before the owner or the insurer could be held liable for payment of compensa- tion in motor vehicle accident claims. <ORG> views are opposed to basic principles of the owner's liabil- ity for negligence of his servant and are based on a com- plete misreading of the provisions of Chapter VIII of the . Motor Vehicles Act . [900 F] 1. Before a person can be made liable to pay compensa- tion for any injuries and damage caused by his action. it is necessary that the person injured should be able to establish that he has some cause of action against the party responsible. In order to succeed in an action for negligence the plaintiff must prove (1) that the defendant had, in the circumstances, a duty to, take care and that duty was owed by him to the plaintiff and (2) that there .was a breach of that duty and that as a result of the breach damage was suffered by the plaintiff. The master also becomes liable for the conduct of the servant when the servant is proved to have acted negligently in the course of his employment. [895 C-D] 2(a) The purpose of making insurance compulsory is to protect the interests of the successful claimant from being defeated by the owner of the vehicle who has not enough means to meet his liability. The safeguard is provided by imposing certain statutory duties, namely, the duty not to. drive or permit a car to be driven unless the car is covered by third party insurance. 1895 F] (b) Under s. 95(1)(b)(i) of the Act, the policy of insurance must be a policy which insures against any liabil- ity which may be incurred in respect of death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. The accident to which the owner or the person insuring is liable is to the extent of his liability in respect of death or bodily injury and that liability is covered by the insurance. It is, therefore, obvious that if the owner has not incurred any liability in respect of death or bodily injury to any person there is no liability and it is not intended to be covered by the insurance. The liabil- ity contemplated arises under the law of negligence and under the principle of vicarious liability. The provisions of the section do not make the owner or the insurance compa- ny liable for any bodily injury caused to a third party arising out of the use of the vehicle unless the liability can be fastened on him. [896 D-F] 887 (c) Under sub-cl. (ii) of s. 95(1)(b) of the Act the policy of insurance must insure a person against death or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place. So far as the bodily injury caused to a passenger is concerned it need not be due to any act or liability incurred by the person. The expression "liability which may be incurred by him" in sub.-cl. (i) is meant to cover any liability arising out of the use of the vehicle. Therefore, the person must be under a liability and that liability alone is covered by the insurance policy. [896 F-H] (d) The owner's liability arises out of his failure to discharge a duty cast on him by law. The right to receive compensation can only be against a person who is bound to compensate due to the failure to perform a legal obliga- tion. If a person is not liable legally he is under no duty to compensate any one else. <ORG> is a tribu- nal constituted by the State Government for expeditious disposal of the motor vehicles claims. The general law applicable is only common law and the law of torts. If under the law a person becomes legally liable then the person suffering the injuries is entitled to be compensated and the tribunal is authorised to determine the amount of compensation which appears to be just. The plea that the Claims .<ORG> is entitled to award compensation which appears to be just when it is satisfied on proof of injury to a third party arising out of the use of a vehicle on a public place without proof of negligence, if accepted, would lead to strange results. [897 E-F] 3. The power to constitute one or more Motor Vehicle Claims <ORG>s under s. 110(1) is optional and the State Government may not constitute a Claims <ORG> for certain areas. When a claim includes a claim for compensation, the claimant has an option to make his claim before <ORG>. In claims for compensation, therefore, in certain cases, Civil Courts also have jurisdiction. If the contention put forward is accepted so far as <ORG> is concerned, it would have to determine the liability of the owner on the basis of common law or torts while the Claims <ORG> can award compensation without reference to common law or torts and without coming to the conclusion that the owner is liable The concept of owner's liability without any negligence is opposed to the principles of law. The mere fact that a party received an injury arising out of the use of a vehicle in a public place, cannot justify fastening liability on the owner. It may be that a person bent upon committing suicide may jump before a car in motion and thus get himself killed. In such cases, the owner cannot be made liable. Proof of negligence remains the lynch pin to recover compensation. [897 H; 898 A-B] Haji zakariaand <CITATION> A.I.R. 1976 A.P.171 and <CITATION> , 1971 A.C.J. 58 not approved. <NAME> v. State Insurance Officer, 1971 A.C.J. 219 and <ORG> v. V. <NAME> and others, A.A.O. 607 of 1973 and 296 of 1974 decided by <ORG> on December 13, 1976 referred to. JUDGMENT:

CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1249 of 1976.

Appeal by Special Leave from the Judgment and Order dated the 23-3-1976 of <ORG> in C. No. 449/75 from Original Decree.

<NAME>, <NAME> and <NAME> for the Appel- lants.

<NAME>, <NAME> and (Mrs.) <NAME> for. Res. No. 1.

<NAME> and <NAME> for the applicant/Inter- vener.

The Judgment of Court was delivered by This appeal is by special leave under Article 136 of the Constitution by the two appellants against the judgment of <ORG> dismissing their appeal against the judg- ment of <ORG> for Greater Bombay and confirming the award passed by the tribu- nal in favour of the respondents and directing the <ORG> to decide the question of the liability of <ORG> on its application that its liability is limited to Rs. 20,000 under section 110E of the Motor Vehicles Act, 1939 referred to as the Act after giving opportunity to the parties.

The applicant in Application No. 727 of 1969 before <ORG> for Greater Bombay is one Dr. <NAME> practising in Bombay and is the respondent in this appeal. On 14th April, 1969 at about 1.00 p.m. the respondent was driving his car No. MRC- 4450 towards Fort side on Dr. Annie Besant Road. With him was sitting on the left side in the front seat <NAME>, his nurse. The road has stone dividers in the middle of the road. When the car approached <ORG> cinema the truck owned by the appellants and insured with <ORG> who were opposite parties 1 to 3 before <ORG> came from the opposite direction at a high speed and dashed against the right side of the car. Due to the impact the car was damaged and the 1st respondent and <NAME> were injucted. Re- spondent 1 had to undergo treatment. He was operated on the day of the accident itself and was patient in his own <ORG> for a month till 15th May, 1969. According to him his right arm was operated and kept in plaster and that he had become permanently disabled in discharging his duties as a surgeon and that he had incurred a loss during the closure of the <ORG> rind loss of income due to permanent injury along with other claims. He claimed a sum of Rs. 3 lakhs by way of general and special damages with interest thereon from the date of his application. The owners of the vehicle fried a written statement refuting the claim of the applicant. According to them while the motor lorry was proceeding from Haji Ali towards Worli, they had taken all precautions to keep the lorry in road worthy condition and that at the material time the axle brake ring of the motor lorry came out and the driver therefore lost control of the vehicle and because of this defect which can develop in a running car the driver lost control of the' steering wheel. According to them the lorry prior to the accident was being driven at a moderate speed with due care and caution. They contended that the accident did not occur on account of rash and negligent driving on the part of the driver. They also denied the claim of various items of compensation made by the applicant.

<ORG> framed four issues. The first 2 issues were whether the applicant had proved that the driver of the lorry was driving the vehicle in rash and negligent manner and whether the opposite party had proved that at the time of the accident the axle brake ring of the motor lorry came out and the driver lost control of the motor lorry. The other 2 issues related to the ques- tion as to whether the applicant received the injuries as a result of this accident and whether he was entitled to the compensation claimed by him.

The applicant examined himself and <NAME> who was travelling with him at the time of the accident regarding the incident. He also examined P. Ws 2 and 3, P.W. 2 a nurse to prove his income from his profession and P.W. 3 a doctor who treated him. On behalf of the appellant 6 witnesses were examined in support of their case that the accident was due to a mechanical failure and not due to any rashness or negligence on the part of the driver. The <ORG> after elaborately discussing the oral and documentary evidence adduced before it found that the acci- dent was due to the rash and negligent driving of the driver of the lorry and the defence set up that the accident was due to mechanical failure of the lorry was unacceptable. The Claims <ORG> accepting the evidence of the appli- cant and a <ORG> Officer, Mr. <NAME>, who was examined as <NAME> on the side of the appellants, came to the conclusion that when the doctor was in the traffic lane nearer to the road divider the lorry crossed the road divider and hit the car. The defence witness himself stated that the lorry came after crossing the central barricade. The lorry went off the track and went on the wrong side and collided with the oncoming car of the applicant who was in his car. Refer- ring to his notes the witness stated that the right side of the lorry went and hit the right side of the car of the applicant. The portion of the lorry upto the driver's seat collided with the right side of the car. Both the wheels of the front side of the lorry had crossed the central reservation tract and so also the right rear wheel was on the wrong side and only the left rear wheel was just near the edge of the central reservation tract towards <ORG> cinema. On the face of the evi-dence of the doctor and their own witness <NAME> who was travelling in the lorry there could be no denying the fact that the lorry crossed the middle of the road.

Relying on the evidence of the two witnesses as well as the doctrine of res ispa 1oquitur <ORG> right- ly found that the applicant had established rash and negli- gent driving on the part of the driver and the lorry. <ORG> has also discussed elaborately the defence set up on behalf of the owners of the lorry and rejected it. The plea that was taken in the pleadings was that at the time of the accident "Axle Brake Ring" of the lorry came out. The expert examined on behalf of the owner, <NAME>, D.W. 6, stated that he had never heard of any such part as axle brake ring and he has never seen such a part. The owners subsequently explained that what they meant by "Axle Brake Ring" was drag link on the rod end. <ORG> also referred to the evidence of the expert examined on behalf of the owners and remarked that the nut on the pin could not be blown off all of a sudden and that the driver, unless he was negligent, could feel the change if there was anything wrong with the drag link end and can stop the vehicle immediately. Rejecting the evidence of the driver and relying on the evidence of the expert on the side of the defence that even if there was any defect the vehicle could be stopped within 4 or 5 feet and need not cover the distance which it did, <ORG> also found that the defect which the defence wit- ness, Motor Vehicle Inspector Partapsingh Chavan, D.W.I. saw when he examined the lorry on 22nd April, 1969, could not be accepted as the owners of the lorry could have played mischief and created evidence before inspection on 22nd April, 1969. Criticising the conduct of the owners as unworthy of their status <ORG> totally rejected the defence. Regarding the compensation <ORG> fixed the amount at Rs.1,43,400 together with interest at 6 per cent. This sum was apart from a sum of Rs.500 which was found payable to <NAME> who had sustained injuries. <ORG> directed the owners as well as the insurers jointly to pay the amount, to the respondent Dr. <NAME>. It also directed the oppo- site parties and insurers to pay Rs. 1000 as costs and Rs.100 as costs of <NAME>.

<ORG> fixed a sum of Rs. 73,779 as the loss sustained by the doctor for a period of 4 years from the date of the accident. It also for a subsequent period of 7 years fixed the future loss at Rs. 9,000 a year and a total amount of Rs. 63,000. In addition it awarded a sum of Rs. 5,000 for discomfort and inconvenience suffered by the doctor. Thus the total compensation that was granted amount- ed to Rs. 1,43,400. As already stated the interest was awarded from the filing of the application till payment. The insurance company as well as the owners of the lorry preferred appeal against the award of the <ORG> in Appeal No. 449 of 1975 before <ORG>. Though the appeal was filed on behalf of the insurance company and the owners of the lorry, during the hearing of the appeal it was contended on .behalf of the insurance company that in any event the liability of the insurance company under the policy could not exceed Rs.20,000. <ORG> on the question of whether there was negligence on the part of the driver of the lorry or not found itself in complete agreement with the Claims <ORG> and observed that it was for the lorry driver and owners to establish as to how the lorry crossed the road dividers, went on the wrong side and mounted on the <ORG> Car coming 'from the opposite direction. Agreeing with the <ORG> it found that the driver was negligent. <ORG> concurred with the reasons. and findings of the <ORG>. It also held in the Circumstances of the case that the principle res ipsa loquitur applied. <ORG> also rejected the defence taken by the owners that the injury was due to a mechanical defect and not due to the negligence. After referring to the evidence and the reasoning of the <ORG>. on the defence set up by the owners <ORG> came to the conclusion that the plea about the breaking of the tie rod was not proved satisfactorily by the owners. <ORG> regarding the defence raised found itself .in complete agreement with the conclusion arrived at by the <ORG> observing that the <ORG> rightly disbelieved the defence plea and came to the conclusion after careful consideration of the evidence of the driver, <ORG> Officer and other evidence in the case that it was the driver who was negli- gent.

Regarding the quantum of damages <ORG> ex- pressed its opinion that the <ORG> had made best efforts and tried to determine the compensation in a just manner on the facts and circumstances of the case. It confirmed the amount as awarded by the <ORG> and dismissed the appeal. <ORG> dismissed the appeal of the owners and the insurance company and confirmed the award passed by the <ORG>. But it gave liberty to the insurance company to apply to the Claims <ORG> on depositing Rs. 20,000 with interest from the date of the application to the date of the deposit for determination of the question that the liability of the insurance company is limited only to Rs. 20,000. <ORG> directed the <ORG> to decide the question of the liability of the insurance company on its application under section. 110E by giving opportunity to the parties to put forward their cases.

Insurance company was directed to pay the costs of all the parties. It also provided that the claimant was at liberty to withdraw Rs. 20,000 with interest when deposited by the insurance company. The order also made it clear that the right of the applicant to recover the balance of the awarded amount from the other party or from the insurance company will not in any way be affected.

The appeal to this court is preferred by the owners. The insurance company is impleaded as the second respondent in the appeal before us.

Mr. <NAME>, the learned counsel appearing for the owners submitted that <ORG> did not hear arguments on the question whether the accident took place due to rash and negligent driving of the lorry and therefore the ques- tion will have to be gone into by this Court or remanded for fresh disposal. We find that <ORG> has given a clear finding in paragraph 30 of its judgment that the <ORG> rightly disbelieved the plea and held that it was the. driver who was negligent and that they fully concur with the reasons and findings of the learned Member of the <ORG>. In the face of the clear finding we are unable to accept the plea of the learned counsel that this question was not gone into by <ORG>. We find ourselves in complete agreement with the finding of the <ORG> and <ORG> that it was due to rash and negligent driving of the lorry that the car in which the applicant and <NAME> were travelling was hit causing injuries to both of them. We accept the testimony of the doctor and <NAME> that the lorry crossed the road dividers, ran into the wrong side and hit the car which was driven by the applicant. We have no hesitation in accepting the concur- rent findings of <ORG> and the Claims <ORG> that the accident was due to the rash and negligent driving of the lorry driver. We have also no hesitation in reject- ing the testimony of the defence that there was some mechan- ical defect which resulted in the tie rod end breaking. We find ourselves in agreement with the reasoning of the Claims <ORG> that the evidence on the side of the owners is contradictory and the testimony of the expert destroys the plea of any mechanical defect set up by them. In this con- nection we may also point out that in order to succeed in a 9--206SCI/77 defence that the accident was due to a mechanical defect the owners will have to prove that they had taken all necessary precautions and kept the lorry in a roadworthy condition. No such attempt was made to establish that all necessary precautions were taken-to keep the lorry in a roadworthy condition and that the defect occurred in spite of the reasonable care and caution taken by the owners. In order to sustain a plea that the accident was due to the mechanical defect the owners must raise a plea that the defect was latent and not discoverable by the use of reason- able care. The owner is not liable if the accident is due to a latent defect which is not discoverable by reasonable care. The law on this subject has been laid down in Hen- derson v. <ORG>). In that case the lorry driver applied the brakes of the lorry on a steep hill but they failed to operate. As a result the lorry struck and killed a man who was emerging from a parked vehicle. The defence was that brake failure was due to a latent defect not discoverable by reasonable care on driver's part. It was found that the lorry was five years old and had done at least 150,000 miles. The brakes were hydrauli- cally operated. It was also found after the accident that the brake failure was due to a steel pipe bursting from .7mm. to .1mm. The corrosion had occurred where it could not be seen except by removing the pipe completely from the vehicle and this had never been done. Expert evidence showed' that it was not a normal precaution to do this if, as was the case, the visible parts of the pipe were not corroded. The corrosion was unusual and unexplained. An expert witness said it must have been due to chemical action of some kind such as exposure to salt from the roads in winter or on journeys near the sea. <ORG> held that the burden of proof which lay on the defendants to show that they had taken all reasonable care had been dis- charged. The defect remained undiscovered despite due care As the evidence had shown that something unusual had hap- pened to cause this corrosion it was necessary for the defendants to show that they neither know nor ought to have known of any unusual occurrence to cause the breakdown. (See Bingham's Motor Claims Cases Seventh Ed., p. 219). The burden of proving that the accident was due to a mechanical defect is on the owners and it is their duty to show that they had taken all reasonable care and that de- spite such care the defect remained hidden. In this case in the written statement all that is pleaded is that the axle brake ring of the lorry came out and the driver lost control of the motor lorry and that the defect can develop in a running vehicle resulting in the driver's losing control of the steering wheel. Though it was stated that all precautions were taken-to keep the lorry in a road worthy condition it was not specifically pleaded that the defect i.e. the axle brake ring coming out, is a latent pleaded and could not have been discovered by the use of reasonable care. This lack of plea is in addition to the lack of evidence and the fact that the defence set up has been rightly rejected by the <ORG>.

(1) [1970] A.C.282[1969] 3 All E.R. 756 Mr. <NAME> then submitted that the quantum of compensa- tion awarded was very high. He submitted that even accord- ing to the figures relied on by <ORG> it was in error in coming to the conclusion that for a period of 4 years from the date of the accident the claimant has suf- fered a damage of Rs. 73,779. The learned counsel submit- ted that though during the first year there was a loss of Rs. 3,530 in subsequent years he earned various amounts and in one year he earned Rs. 7,981 which would mean that during subsequent years his loss would not have been. more than Rs.10,000 and as admittedly <ORG> was kept as a going concern the award of Rs. 10,000 per year for the four years would be very high. We have considered this conten- tion carefully but taking all the circumstances into account we do not feel called upon to interfere with the quantum arrived at by the <ORG> and confirmed by <ORG>. The learned Counsel also submitted that the provision for Rs. 63,000 for the 7 years as the likely loss due to the doctor's disability is also very high. In this case also we do not feel called upon to interfere with the quantum arrived at by the <ORG> as well as <ORG>. Last- ly, the learned counsel submitted that in any event the interest awarded from the date of the application is not justified. We do not think we will be justified in interfer- ing with the amount of interest awarded by <ORG> from the date of the filing of the application. On the above findings we confirm the award passed by the Claims <ORG> in favour of the applicant/respondent No. 1 for Rs. 1,43,400 with interest at 6% per annum from the date of the filing of the application and also a sum of Rs.500 granted to <NAME> and the costs awarded. The liability of the owners and the insurance company will be joint and several and the respondent would be at liberty to proceed against either or both of them to realise the amount awarded in his favour.

We have now to consider the direction given by <ORG> regarding the determination of the liability as be- tween the insurance company and the owners. The owners and the insurance company were represented by the same counsel before the <ORG> and before <ORG> the learned counsel on behalf of the insurance company pleaded that its liability is limited to Rs. 20,000 only. <ORG> has given liberty to the insurance company to apply on depositing Rs. 20,000 with interest as directed for determi- nation of the question that the liability of the insurance company is limited to Rs. 20,000. <ORG> also directed the <ORG> to decide the liability of <ORG> on the insurance company filing such an appli- cation after giving notice to all the parties. <ORG> has not appealed against the judgment and decree of <ORG> and we see no reason for interfer- ing with the order. On the insurance company complying with the directions of <ORG> by depositing Rs. 20,000 with interest as specified the matter will be remitted to the <ORG> for determination of the question whether the liability of the insurance company is limited to Rs.20,000 only. It is made clear that so far as the award made in favour of the applicant/respondent is concerned he will be at liberty to proceed against the owners as well as the insurance company jointly and severally. With these direc- tions the appeal is dismissed with the cost of the first respondent.

This should normally conclude the judgment but we feel it desirable that we must deal with the question of law that has been dealt with at considerable length by <ORG> as to whether it is incumbent on the claimant to prove negligence before he would become entitled to compensation. <ORG> after concurring with the findings of the <ORG> and holding that the driver was negligent proceeded to state that it would not have been necessary for them to say anything more but for the fact that taking into account the importance of matter and in public interest it would be appropriate to express its view that it is not necessary to prove negligence on the part of a driver before claiming compensation.

Both the learned Judges have written lengthy judgments fully discussing the matter and have come to the conclusion that the fact of an injury resulting from the accident involving the use of a car on the public road is the basis of a liability and that it is not necessary to prove any negligence on the part of the driver. We find that a Bench of <ORG> has held in <CITATION> (1) that the liability of the insured and consequently of the insurer to compensate a third party dying or being injured on account of the use of the insured vehicle is irrespective of whether the death, injury etc. has been caused by rash and negligent driving. Though this question does not arise in this appeal as the two High Courts have expressed an opinion which in our view has no basis either in the Legislative history or on a construction of the relevent provisions of the Motor Vehi- cles Act we feel it necessary to state the position of law. The liability of the owner of the car to compensate the victim in a car accident due to the negligent driving of his servant is based on the law of tort. Regarding the negli- gence of the servant the owner is made liable on the basis of vicarious liability. Before the master could be made liable it is necessary to prove that the servant was acting during the course of his employment and that he. was negli- gent. The number of the vehicles on the road increased phenomenally leading to increase in road accidents. To remedy the defect various steps were taken. In England the owners of the vehicle voluntarily insured against the risk of injury to other road users. With ' the increase of traffic and accidents it was found that in a number of cases hardship was caused where the person inflicting the injury was devoid of sufficient means to compensate the person afflicted. In order to meet this contingency the Road Traffic Act, 1930, The Third Parties (Rights against Insur- ers) Act, 1930 and the Road Traffic Act, 1934 were enacted in England. A system of compulsory insurance was enacted by the Road Traffic Act, 1930. Its object was to reduce the number of cases where judgment for personal injuries (1) A.I.R.. 1976 A.P. 171.

obtained against a motorist was not met owing to the lack of means of the defendant in the running-down action and his failure to insure against such a liability. It is suffi- cient to state that compulsory insurance was introduced to cover the liability which the owner of the vehicle may incur.

The Indian law introduced provisions relating to compulsory insurance in respect of third party insurance by introducing Chapter VIII of the Act. These provisions almost wholly adopted the provisions of the English law. The relevant sections found in the three English Act s, Road Traffic Act, 1940, the Third Parties (Right against Insur- ers) Act, 1930 and the Road Traffic Act, 1934 were incorpo- rated in Chapter VIII. Before a person can be made liable to pay compensation for any injuries and damage which have been caused by his action it is necessary that the. person damaged or injured should be able to establish that he has some cause of action against the party responsible. Causes of action may arise out of actions for wrongs under the common law or for breaches of duties laid down by stat- utes. In order to succeed in an action for negligence the plaintiff must prove (1) that the defendant had in the circumstances a duty to take care and that duty was owed by him to the plaintiff, and that (2) there was a breach of that duty and that as a result of the breach damage was suffered by the plaintiff. The master also becomes liable for the conduct of the servant when the servant is proved to have acted negligently in the course of his employment. Apart from it in common law the master is not liable for as it is often said that owner of a motor car does not become liable because of his owning a motor car.

The purpose of enactment of Road Traffic Acts and making insurance compulsory is to protect the interests of the successful claimant from being defeated by the owner of the vehicle who has not enough means to meet his liability. The safeguard is provided by imposing certain statutory duties namely the duty not to drive or permit a car to be driven unless the car is covered by the requisite form of third party insurance. Section 94 of the Act, provides that no person shall use except as a passenger or cause or allow any other person to use a motor vehicle in a public place unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of the Chapter. Section 95 of the Act is very important and that specifies the requirements of policies and limits of liabil- ity. Section 95(1)(a) and (b) of the Act are extracted. They run as follows:

"95. (1) In order to comply with the requirements of this Chapter, a policy of insurance. must be a policy which--

(a) is issued by a person who is an authorised insurer or by a co-operative socie- ty allowed under section 108 to transact the business of an insurer, and

(b) insures the person or classes of persons specified in the policy to the extent speci- fied in sub-section (2)--

(i) against any liability which may be incurred by him in respect of the death or of bodily injury to any person or damage to any property of a third party caused by or aris- ing out of the use of the vehicle in a public place;

(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place:

Under section 95(1)(b)(i) of the Act it is required that policy of insurance must be a policy which insures the person, against any liability which may be incurred by him in respect of death or bodily injury to any person or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place. It may be noted that what is intended by the policy of insurance is insuring a person against any liability which may be incurred by him. The insurance policy is only to cover the liability of a person which he might have incurred in respect of death or bodily injury. The accident to which the owner or the person insuring is liable to the extent of his liability in respect of death or bodily injury and that liability is covered by the insurance. It is therefore obvious that if the owner has not incurred any liability in respect of death or bodily injury to any person there is no liability and it is not intended to. be covered by the insurance. The li- ability contemplated arises under the law of negligence and under the principle of vicarious liability. The provisions as they stand do not make the owner or the insurance company liable for any bodily injury caused to a third party arising out of use of the vehicle unless the liability can be fas- tened on him. It is significant to note that under sub- clause (ii) of section 95(1)(b) of the Act the policy of insurance must insure a person against the death or bodily injury to any passenger of a public service vehicle caused by or arising out of the use of the vehicle in a public place. Under section 95 (1)(b) clause (ii) of the Act the liability of the person arises when bodily injury to any passenger is caused by or use of the vehicle in a public place. So far as the bodily injury caused to a passenger is concerned it need not be due to any act or liability in- curred by the person. It may be noted that the provisions of section 95 are similar to section 36(1) of the English Road Traffic Act. 1930, the relevant portion of which is to the effect that a policy of insurance must be policy which insures a person in respect of any liability which may be incurred by him in respect of death or bodily injury to any person caused by or arising out of the use of the vehicle on road. The expression "liability" which may be incurred by him" is meant as covering any liability arising out of the use of the vehicle. It will thus be seen that the person must be under a liability and that liability alone is cov- ered by the insurance policy.

Section 96 of the Act also makes the position Clear. It provides that when a judgment in respect of such a liability as is required to be covered by a policy is obtained against any person insured by the policy, then the insurer shall pay to the person entitled the benefit of the decree as if he were a judgment-debtor. The liability is thus limited to the liability as is covered by the policy.

The main contention of Mr. <NAME>, who supported the view of <ORG> that negligence need not be proved is that Chapter VIII of the Act is a consolidating and amending Act relating to motor vehicles and their use on a public place and as such it contains the entire law, procedural as well as substantive, and that the common law or law of torts is no more applicable and if death or bodily injury arises out of the use of motor vehicles in a public place a liabil- ity arises. Strong reliance was placed by him on section 110A of the Act which provides for application for compensa- tion arising out of an accident to <ORG>. The learned counsel would submit that under section 110B <ORG>, after holding an inquiry, may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom the compensation shall' be paid. According to counsel when an injury is caused by the use of the vehicle in a public place <ORG> is at liberty to award an amount of compensation which appears to it to be just. This plea ignores the basic requirements of the owner's liability and the claimant's right to receive compensation. The owner's liability arises out of his failure to discharge a duty cast on him by law. The right to receive compensation can only be against a person who is bound to compensate due to the failure to perform a legal obligation. If a person is not liable legally he is under no duty to. compensate any one else. <ORG> is a tribunal constituted by the State Government for expeditious disposal of the motor claims. The general law applicable is only common law and the law of torts. If under the law a person becomes legally liable then the person suffering the injuries is entitled to be compensated and the <ORG> is authorised to determine the amount of compensation which appears to be just. The plea that <ORG> is entitled to award compensa- tion which appears to be just when it is satisfied on proof of injury to a third party arising out of the use of a vehicle on a public place without proof of negligence if accepted would lead to strange results.

Section 110(1) of the Act empowers <ORG> to constitute, one or more Motor Accidents Claims Tribunals for such area as may be specified for the purpose of adjudi- cating upon claims for compensation in respect of accidents involving the death or bodily injury to persons. The power is optional and <ORG> may not constitute <ORG> for certain areas. When a claim includes a claim for compensation the claimant has an option to make his claim before <ORG>. Regarding claims for compensation therefore in certain eases Civil Courts also have jurisdiction. If the contention put forward is accept- ed so far as <ORG> is concerned it would have to determine the liability of the owner on the basis of common law or torts while <ORG> can award compensation without reference to common law or torts and without coming to the conclusion that the owner is liable. The concept of owner's liability without any negligence is opposed to the basic principles of law. The mere fact that a party received an injury arising out of the use of a vehicle in a public place, cannot justi- fy fastening liability on the owner. It may be that a person bent upon committing suicide may jump before a car in motion and thus get himself killed. We cannot perceive by what reasoning the owner of the car could be made liable. The proof of negligence remains the lynch pin to recover compensation. The various enactments have attempted to mitigate a possible injury to the claimant by providing for payment of the claims by insurance.

In Halsbury's Laws of England, 3rd Ed., Vol. 32, at paragraph 751 at p. 366 the nature of insurance required is stated as follows :-

"The conditions to be fulfilled in order to render the use of a motor vehicle lawful are (1) that there must be a policy of insur- ance. in force in relation to the use of the vehicle on a road, and (2) that it must be a policy complying with the relevant statutory requirements."

At paragraph 752 at page 366 the general nature of liabili- ties required to be covered are stated as under:

"In order to comply with the statutory requirements, a policy must provide insurance cover in respect of any liability which may be incurred by such person, persons or classes of persons as are specified in the policy, in respect of the death of, or bodily injury to, any person (subject to specific exceptions) caused by, or arising out of the use of the vehicle on a road."

The authorised insurers issuing a policy pursuant to the statutory requirements are obliged to indemnify the person specified in the policy in respect of any liability which the policy purports to cover in the case of that person or classes of persons.***" (Paragraph 758 at p. 369). These passages clearly indicate that the nature of the liability required to be covered is the liability which may be in- curred by or arising out of the use of a vehicle on a road by the person.

A person is not liable unless he contravenes any of the duties imposed on him by common law or by the statute. In the case of a motor accident the owner is only liable for negligence and on proof of vicarious liability for the acts of his servant. The necessity to provide effective means for compensating the victims in motor accidents should not blind us in determining the state of law as it exists today. Justice <NAME> in this judgment under appeal after referring various decisions expressed his view as follows :--

"It is not necessary to discuss all these cases because, in any view, in none of those cases was the question agitated as to what exactly was meant by tort in the context of automobile accidents and injuries resulting. therefrom, for which more often than not human minds, hands or legs are not always accountable, in the later half of the twentieth century. The question has engaged the minds of jurists all over the common law world .... "

The learned Judge proceeded further to observe that whether we apply the test of torts or not the liability to pay compensation arises when the injuries are caused by the use of the motor vehicle and the <ORG> can adjudicate upon the liability and determine just compensation. The learned Judge further observed: "In my opinion, public good re- quires that everyone injured, viz., by the use of motor vehicle, must immediately get compensation for the injury. Every person has a right to safety and security of his person irrespective of fault or negligence or carelessness or efficient functioning of the motor vehicle. Every person has a right to claim compensation so that is the only way of remedying the injury caused to him in a modern urbanised, industrialised and automobile ridden life."

In a separate judgment Justice <NAME> has expressed himself in the same tenor. The learned Judge after referring to section 95(1)(b) (i) and (1)(b)(ii) of the Act observed that perimeters of liability in clauses (i) and (ii) must be held to be the same because to both the liability of the owner or the driver exists and is made compulsorily insura- ble. The learned Judge while noting the difference in the wording of the two, clauses observed that it is inconceiva- ble that the legislature would intend absolute liability in cases covered by clause (ii) and not in cases covered by clause (i).

The reasoning of the two learned Judges is unacceptable as it is opposed to basic principles of the owner's liabili- ty for negligence of his servant and is based on a complete misreading of the provisions of Chapter VIII of the Act. <ORG> zeal for what it considered to be protection of public good has misled it into adopting a course which is nothing short of legislation.

Equally unacceptable is the view of the Bench of <ORG> in <CITATION> (1), wherein the court concluded without any hesitation that the liability to compensate arises when death or bodily injury to any person or damage to any property of a third party is caused by or arising out of the use of the vehicle in a public place and to infer the qualifications or limitations that such death or bodily injury should have been caused before such liability arises only on account of rash and negligent driving would amount to introducing something which is not there and would be violating and transgressing the Clear provisions of the statute and intention of the legislature. (1) A.I.R. 1975 A.P. 171.

<ORG> in <ORG> v. <NAME> and Others(1) held that the liability of the insurance company is absolute but is only limited to the extent provided by the insurance policy. As against this view all the other <ORG> have held that the liability to compensate arises only on a finding of negligence. It may not be out of place to mention that those automobile accidents are subject to the law of negligence. Modern proposals consistently favour the Social Insurance model under which benefits are payable directly by the fund with- out any reference at all to the injurer while retaining an option for the victim to claim either limited benefits on a nonfault basis or full damages for negligence.

Consistent with this line of thinking is the judgment of <ORG> in <NAME> v. State Insurance Officer(2), where Justice <NAME> expressed himself thus: "Out of a sense of humanity and having due regard to the handicap of the innocent victim in establishing the negligence of the operator of the vehicle a blanket liabili- ty must be cast on the insurers." Modern legislation has also provided insurance cover for all air and rail passen- gers and recently by amendment of section 95 of the Act against death or bodily injury to passengers of a public service vehicle caused by or arising out of the use of a vehicle in a public place.

In a recent judgment of <ORG> <ORG> is A.A.O. Nos. 607 of 1973 and 296 of 1974 M/s. <ORG> v. <NAME> and others, delivered on 13th December, 1976, has suggested the necessity of having social insurance to provide cover for the claimants irre- spective of proof of negligence to a limited extent say Rs.250 to Rs. 300 a month. It has also suggested that instead of a lump sum payment which does not often reach the claimants a regular monthly payment to the dependants by the nationalised insurance company or bank would be desira- ble. Unless these ideas are accepted by the legislature and embodied in appropriate enactments <ORG> are bound to administer and give effect to the law as it exists today. We conclude by stating that the view of the learned Judges of <ORG> has no support in law and hold that proof of negligence is necessary before the owner of the insurance company could be held to be liable for the payment compensa- tion in a motor accident claim case.

But as we have found that the vehicle owner was liable for negligence of the driver and have upheld the amount of damages awarded, we dismiss this appeal with cost to the first respondent.

P.B.R. Appeal dismissed. (1) 1971 A.C.J. 58. (2) 1971 A.C.J. 219.


PETITIONER: KESHAVLAL JETHALAL <NAME> Vs. RESPONDENT: MOHANLAL BHAGWANDAS & ANR. DATE OF JUDGMENT: 02/04/1968 BENCH: <NAME>, <NAME> BENCH: <NAME>, <NAME> HIDAYATULLAH, M. (CJ) SIKRI, S.M. BACHAWAT, R.S. MITTER, G.K. VAIDYIALINGAM, C.A. HEGDE, K.S. CITATION: 1968 AIR 1336 1968 SCR (3) 623 CITATOR INFO : R 1973 SC 566 (7) D 1973 SC1227 (51,55) F 1973 SC1336 (5) R 1986 SC1760 (35) ACT: Bombay Rents, Hotel and Lodging House Rates Control Act 57 of 1947, s. 29(1) and (2)-amended by Gujarat Act 18 of 1965- whether amended s. 29(2) applied to a case where decision of appellate <ORG> given before the amended section came into force-or if <ORG> <ORG> could only exercise power under v. 115 C.P.C. in such case. HEADNOTE: In a suit filed by the respondent in July 1958 for a decree in ejectment, arrears of rent and other dues against the appellant in respect of certain premises in Ahmedabad, the trial court dismissed the claim for ejectment and passed a decree for arrears of rent and permitted increases. in appeal under s. 29 of the Bombay Rents, Hotel and Lodging House Rates Control Act 57 of 1947 the decree was confirmed on February 25, 1963. By s. 29(2) of that Act, as it then stood, no appeal lay against any decision in appeal under sub-section (1) from the order of the trial court. The respondent therefore moved the <ORG> <ORG> by a petition under s. 115 CPC. While this petition was pending Bombay Act 57 of 1947 was amended by Gujarat Act 18 of 1965 and it was provided in the amended s. 29(2) that while no appeal would lie against any decision in appeal under sub-section (1). the <ORG> <ORG> may, for the purpose of satisfying itself that a decision in appeal was according to law, call for the case and pass such order as it thinks fit. On the assumption that the amended Act applied to, all petitions pending before it, the <ORG> <ORG>, after a detailed examination of the case, reversed the order of the appellate court and decreed the respondent's suit. In appeal by special leave to this <ORG>, it was contended, inter alia, by the appellant that the order of the appellate court which had acquired finality, subject to the exercise of the limited jurisdiction by the <ORG> <ORG> under s. 115 C.P.C. could not be set aside in exercise of the juris- diction under the amended s. 29(2) in the absence of a provision in the Amending Act making the amendment retrospective. HELD : The <ORG> <ORG> exercised the jurisdiction invested by Act 18 of 1965 in respect of a judgment which had become final a long time before that Act. The appeal must therefore be allowed, the order passed by the <ORG>, <ORG> set aside and the proceedings remanded to the <ORG> <ORG> to deal with and dispose of the revision application on the footing that it was governed by s. 115 C.P.C. under which it was purported to have been filed. [630 G]. When the revision application was entertained under s. 115 of the Code of Civil Procedure 'the <ORG> <ORG> assumed to itself a limited jurisdiction conferred by I that selection, and in the absence of any express provision made in the Amending Act , the jurisdiction conferred by that section could not be extended. [629 H-630 B]. There is nothing in the language of s. 29(2) as amended, which may indicate that it was intended to be retrospective in operation. [630 D] 624 <CITATION>  2. S.C.R. 1117 and <CITATION>  2 S.C.R. 896; distinguished. <CITATION> ,  5 S.C.R. 157; Colonial Sugar Refining CompNY lTD. V. iRVING,  A.C. 369; Garkipati Veeravva v. N. Subbaih Choudhary  S.C.R. 488 <CITATION> . 32 Bom. 337 and <CITATION> .  1 S.C.R. 214; referred to. In conferring upon the <ORG> <ORG> a wider jurisdiction for the purpose of determining whether the decision of the appellate court was according to law,, the <ORG> did not attempt to legislate in the matter of procedure. It expressly sought to confer upon the <ORG> <ORG> power to reopen questions which till then were to be deemed finally decided. [630 C]. Section 29(2) as amended in terms confers jurisdiction upon the <ORG> <ORG> to call for the record of a case for the purpose of satisfying itself that the decision in appeal was according to law, which the <ORG> <ORG> did not possess before the, date of the Amending Act . It could not he said that the amending clause only sought to explain any pre- existing legislation which was ambiguous or defective. [630 D-E]. JUDGMENT:

CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1271 of 1967.

Appeal by special leave from the judgment and decree dated March 2, 3, 1967 of <ORG> in Civil Revision Application No. 1010 of 1963.

<NAME> and <NAME>, for the appellant.

<NAME> and <NAME>, for the respondents.

Order of Reference <NAME>, J. This appeal raises the question whether a revision petition filed in <ORG> under S. 115 ,-Civil Procedure Code , from an order passed by an appellate court under s. 29 of the Bombay Rents, Hotel and Lodging House Rates Control Act 1947 may after the aimendment of s. 29(2) by the Bombay Rents, Hotel and Lodging House Rates Control (Gujarat Amendment) Act, 1965 be tried in accordance with the amended Act. <ORG> assumed that a proceeding pending before it It the date on which the amending Act came into force had to be dealt with and decided in accordance with the provisions of subsec. (2) of s. 29 as amended. There is no dispute that s. 29(2) as amended has not expressly been given retrospective operation. In <ORG> v. Irving(1), <ORG> held that "while provisions of a statute dealing merely with matters of procedure (1)  A.C. 369 may properly, unless that construction be textually inadmissible, have retrospective effect attributed to them, provisions which touch a right in existence at the passing of the statute are, not to be applied retrospectively in the absence of express enactment or necessary intendment". <ORG> further observed that "provisions which, if applied retrospectively, would deprive of their existing finality orders which, when the statute came into force, were final, are provisions which touch existing rights." The same principle has been affirmed by <ORG> in a later decision in <CITATION> (1).

<CITATION> (2), one of the points decided by this Court in dealing with a case under the Evacuee (Administration of Property) Act , 1947, as amended in 1948, was that even if at the date when an application was made for confirmation of a transaction of exchange by a evacuee, the order of the Custodian was to be deemed final, if by an amending Act passed before the order was made, the order was subject to revision by the Custodian General, the order of the Custodian was denuded of its finality,. <CITATION> .) and Anr.(3) this Court held that where an order of the Custodian had become final under the Patiala Evacuee (Administration of Property) Ordinance, its finality could not be affected retrospectively under s. 58(3) of the Administration of Evacuee Property Act , 1950 which replaced the Ordinance. The Court distinguished the observations made in <NAME> case(2). Another judgment to which our attention was invited is <CITATION> (4) in which this Court observed that according to the decision in <NAME> case(2) an appellate decision under s. 5B of the East Punjab Evacuees' (Administration of Property) Act , 1947 acquires finality after the order in question is made, and "Oven if there be in law any such right at all it can in no sense be a vested or accrued right", and therefore notwithstanding the declared finality of the judgment of the Controller under the Evacuee Property Urban Rent Restriction Act, 1947, when the petition for ejectment was filed, the Act having been amended, <ORG> invested with revisional jurisdiction by s. 15(5) was cornpetent to revise the order of the Controller. This Court observed' that the finality of the order of the Controller attached thereto only when the order was made and therefore if before the date on which the order was made, by amendment of the Act, the order ceased to be final, a revision application to <ORG> was competent.

(1) (1927)L.R.54 I.A.--421.

(2) [1955] 2 S.C.R. 11 17, (2) [1962] 1 S.C.R. 214.

(4) [1960] 2 S.C.R. 896.

It is true that in the present case the order of <ORG> was made before the amending Act was enacted. Under the Rent Act before it was amended. no further appeal <NAME> from the decision of <ORG>, but the jurisdiction of <ORG> under S. 115 Code of Civil Procedure was not on that account excluded. By the amended Act <ORG> is expressly invested with revisional jurisdiction. which is not subject to the restrictions prescribed by s. 115 of the Code of Civil Procedure. The result is that the revision petition when originally filed was triable under s. 115-Civil Procedure Code; it has been tried by <ORG> under the amended s. 29(2) of the Rents, Rates Control Act.

<NAME> case(1) has made a departure from what was apparently a settled rule. The question in this case is whether the rule in <ORG> case(2) will apply, or the exception engrafted upon the rule by the judgment in <NAME> case(1) will apply. We direct that this case be placed before a larger Bench. It will be open to the parties to argue such other points as arise out of the order of <ORG>, but subject to the restrictions imposed by the order granting rule. The Judgment of the Court was delivered by <NAME> The respondents sued the appellant for a decree in ejectment in respect of shop Municipal Census No. 1754 at Ahmedabad and for rent in arrears and additional taxes. The trial court dismissed the claim for ejectment and passed a decree for arrears of rent and permitted increases. In appeal under S. 29 of the Bombay Rents, Hotel and Lodging House Rate,, Control Act 57 of 1947, the decree was confirmed on February 25, 1963 By S. 29(2) of that Act, as it then stood, no appeal lay against any decision in appeal under sub-s. (1) from the order of <ORG>. The respondent accordingly moved <ORG> of Gujarat by a petition under s. 115 of the Code of Civil Procedure. When this petition was pending in <ORG> Bombay Act 57 of 1947 was amended by Gujarat Act 18 of 1965, and sub-s. (2) of s. 29 was replaced by the following' sub- section :

"No further appeal shall lie against any decision in appeal under sub-sec. (1), but <ORG> may for the purpose of satisfying itself that any such decision in appeal was according to law call for the case in which such decision was taken and pass such order with respect thereto as it thinks fit."

On the assumption that by the amended Act <ORG> was empowered to decide all petitions pending on the date on which (1) [1955] 2 S.C.R. 1117.

(2) [1905] A.C. 369.

the amended section came into operation, as if the amended section applied thereto, <ORG> entered upon a detailed investigation of the questions raised by the respondent in the petition(1) whether the tenant proved that he was ready and willing to pay the standard rent and permitted increases within the meaning of s. 12(1) of the Act; (2) whether the tenant was in arrears of standard rent and permitted increases and the amount of tax for more than six months, and therefore the case fell within the pur- view of s. 12(3) (a) and not under s. 12(3) (b) of the Act; and (3) whether in any event the tenant having failed to observe the conditions of the tenancy was disentitled to the protection either, under s. 12(1) or s. 12(3) (b) of the Act, and reversed the order of the appellate court and decreed the respondents suit.. With special leave, the appellant has appealed to this Court. This Court in <CITATION> (1) held that in a petition under s. 115 of the Code of Civil Procedure from an order made by the appellate court under s. 29 of Bombay Act 57 of 1947, <ORG> had no power to set aside the order merely because if was of opinion that the judgment was assailable on the ground of error of fact or even of law: <ORG> may exercise its -power under that section only if the appellate court had acted without jurisdiction or had failed to exercise its jurisdiction or had acted with material illegality or irregularity in the exercise of its jurisdiction. Thereafter <ORG> amended s. 29(2) by Act 18 of 1965 in the manner set out, so as to confer upon <ORG> a jurisdiction wider than the jurisdiction exercisable under s. 115 of the Code of Civil Procedure.

Counsel for the appellant contended that in entering upon an enquiry into the questions raised by the respondent, <ORG> exercised jurisdiction which it did not possess. Counsel contended that the right to appeal-and which expression includes the right to move a superior court in exercise of the revisional jurisdiction-attaches to a litigation when it commences and it is not affected by any subsequent amendment unless an express provision is made giving retrospective operation to the amendment and that the right to appeal which originally attached to the litigation will continue to govern it till it is finally decided. Counsel relied in support of that contention upon the decisions in Colonial Sugar Subbiah Choudhurt(3); and <CITATION> (4).

In the alternative counsel contended that the order of the appellate court which had acquired finality, subject to the exercise of the limited jurisdiction by <ORG> under s. 115 of the (1) [1964] 5 S.C.R. 157.

(3) [1957] S.C.R. 488.

(2) [1905] A.C. 369.

(4) I.L.R. 32 Bom. 337  Code of Civil Procedure could not, in the absence of a provision in the Amending Act making the amendment expressly or by necessary implication retrospective, 'be set aside in exercise of the jurisdiction conferred upon <ORG> by s. 29 (2) of the Amending Act enacted after the date on which the judgment of the appellate court was delivered. We do not think it necessary to express any opinion on the first question, because, in our judgment, on the second point raised by counsel, the appeal must succeed. The suit out of which this appeal arises was filed by the respondent on July 22, 1958; it was decided on October 28, 1961; the appellate court decided the appeal on February 25, 1963 and the Amending Act 18 of 1965 came into effect on June 17, 1965. <ORG> exercised the jurisdiction invested by Act 18 of 1965 in respect of a judgment which had become final a long time before that Act. It is true that this Court in <CITATION> (1) distinguished the judgment of <ORG> in <ORG> case (2) and observed at p. 1133 "...........it appears to be clear that while a right of appeal in respect of a pending action may conceivably be treated as a substantive right vesting in the litigant on the commencement of the action-though we do not so decide-no such vested right to obtain a determination with the attribute of finality can be predicated in favour of a litigant on the institution of the action. By the very terms of section 5-B of East Punjab Act XIV of 1947, finality attaches to it on the making of the order. Even if there be,- in law, any such right at all as the right to a determination with the attribute of final , it can in no sense be a vested or accrued right. It does not accrue until the determination is in fact made, when alone the right to finality becomes an existing right as in....."

In <NAME> case(1), the <ORG> was dealing with a case in which by amendment of statute, the finality which would but for the amendment have attached was taken away before the order was made. This <ORG> in <CITATION> (3) distinguished <NAME> case(3) and held that an order which had become final under a provision of the law could not be affected retrospectively under an Amending Act so as to deprive the order of its finality acquired under the original provision. In <NAME> case(3) an order releasing the property in dispute was passed by the Custodian of Evacuee Property under Patiala Ordinance No. IX of 2004 Samvat. No appeal was filed against (1) 2S.C.R.1117.

(2) [1905]A.C.369.

(3) [1962] 1 S. C. R. 214.

the order of the <ORG> and it became final on that account. The order was however set aside by the <ORG> in exercise of jurisdiction under s. 58(3) of the Administration of Evacuee Property Act 31 of 1950. This Court held that since the order had become final in exercise of the jurisdiction subsequently conferred. in the absence of any positive indication giving s. 58(3) retrospective operation, the finality of the previous order could not be taken away.

Counsel for the respondent relied upon a judgment of this Court in <CITATION> (1) in which following <NAME> case (2) it was held that <ORG> could in exercise of jurisdiction under an Amending Act enacted after the litigation was commenced, set aside an order which, according to the law in force at the date when the litigation was commenced, was not subject to the jurisdiction of <ORG>. In <NAME> case(1) an application for eviction of the appellant from a shop was made in August 1956 under s. 13 of the East Punjab Urban Rent Restriction Act, 1949. An appeal was provided under s. 15 of the Act from the order of the Rent Controller, and sub-s. (4) of s. 15 provided that the decision of the appellate authority, and subject only to such decision, the order of the Controller shall be final. By Amending Act 29 of 1956 which came into force on September 24, 1956, <ORG> was empowered to call for and examine the records relating to any order passed under the Act for satisfying itself as to the legality or propriety of such order. The landlord's application was dismissed by the Rent Controller and in appeal the appellate authority confirmed the order. Thereafter on the application of the landlord <ORG> reversed the order. This Court rejected the contention that <ORG> had no jurisdiction to entertain the revision application under s. 15(3) as amended. The decision brought before <ORG> in exercise of its revisional juris- diction under s. 15(5) of the amended Act was delivered on August 19, 1958, after amendment of the Act on September 24. 1956. On the date on which it was made, the order had acquired no finality, for it was subject to an order which may be passed in a revision application which may be filed before <ORG> under the amended Act. <NAME> case(1) has, therefore, no application to this case. Counsel for the respondent urged that the extension of the jurisdiction of <ORG> by s. 29(2) of Bombay Act 57 of 1947 as amended by Gujarat Act 18 of 1965 related not to any right in existence, but to a matter of procedure, and on that account the Act as amended applied at the hearing, and in deciding the revision application filed by the respondent <ORG> (1) 2S.C.R.896.

(2) [1955] 2 S.C.R. 1117, was bound to apply the amended Act. But when the revision application was entertained under S. 115 of the Code of Civil procedure, <ORG> assumed to itself a limited jurisdiction conferred by that section and in the absence of any express provision made in the Amending Act , the jurisdiction conferred by that section could not be extended. The question whether <ORG> could in exercise of its jurisdiction set aside, modify or after the decision of the appellate, court was not a matter of proce- dure. The order of the appellate court, subject to scrutiny by <ORG> within the limited field permitted by S. 115 of the Code of Civil Procedure, was final. In conferring upon <ORG> a wider jurisdiction for the purpose of determining whether the decision of the appellate court was according to law, the <ORG> did not attempt to legislate in the matter of procedure. The <ORG> expressly sought to confer upon <ORG> power to reopen questions which till then were to be deemed finally decided.

Counsel for the respondent also submitted that s. 29(2) as amended was intended to have retrospective operation, because the Amending Act was in the nature of explanatory legislation. There is nothing in the language of S. 29(2) as amended, which may indicate that it was intended to be retrospective in operation. Section 29(2) as amended in terms confers jurisdiction upon <ORG> to call for the record of a case for the purpose of satisfying itself that the decision in appeal was according to law, which <ORG> did not possess before the date of the Amending Act . The amending clause does not seek to explain any pre- existing legislation which was ambiguous or defective. The power of <ORG> to entertain a petition for exercising revisional _jurisdiction was before the amendment derived from s. 115 Code of Civil Procedure, and the <ORG> has by the Amending Act attempted to explain the meaning of that provision. An explanatory Act is generally passed to supply an obvious omission or to clear up doubts as to the meaning of the previous Act. Section 29(2) . before it was enacted, was precise in its implication as well as in its expression : the meaning of the words used was not in doubt, and there was no omission in its phraseology which was required to be supplied by the amendment.

The appeal is therefore allowed and the order passed by <ORG> is set aside, and the proceeding is remanded to <ORG> to deal with and dispose of the revision application on the footing that it is governed by s. 115 of the Code of Civil Procedure under which it purports to have been filed. The costs of this <ORG> will be costs in <ORG>.

R.K.P.S.

Appeal allowed.