Administration Manual - B.E.S.T. Undertaking.

Recently such rate of subsidy has been raised from Rs. 20/- p.m. to
Rs. 28/- p.m. per employee and confirmed by committee vide BCR No.
546 of 24-3-05 based on 85% increase in the prices of raw materials
required for preparation of victuals.
5.5.4 BILLS TOWARDS ACCIDENT CLAIMS PAYABLE FROM
THE THIRD PARTY INSURANCE FUND.
Under the M.V. Act as it stood before the M.V. (Amendment) Act, 1968
was enacted, the necessity of insurance against third party risk of our
omni buses and other motor vehicles did not arise as the State
Government had exempted the Undertaking from compulsory
insurance against third party risk pursuant to Section 94(2) of the
M.V. Act, 1988.
Though the Undertaking was exempted it has been maintaining a Third
Party Insurance Fund with sanction of the Corporation from which is
drawn from year to year monies for satisfaction of third party claims
mutually settled between claimant and the Undertaking or are
adjudicated upon by Civil Courts.
After the amendment in 1956 to the Principal Motor Vehicles Act,
1939, the Central Government had enacted the Motor Vehicles (Third
Party Insurance) Amendment Rules, 1960 to further amend the Motor
Vehicles (Third Party Insurance) Rules 1946 which inter-alia laid down
that any Local Authority (which the Undertaking legally is) or any State
Transport Undertaking may not, if they so desire, take out an
Insurance Cover with an insurance company to cover Third Party Risks
under the Rules but can establish a Fund with an initial amount of not
less than Rs. 5,00,000.00 which is to be deposited in a bank and then
at the beginning of each accounting year pay a sum of Rs. 500/- per
vehicle in running condition into the Fund. This annual deposit is
continued to be paid till such time the Fund reaches a ceiling of
Rs.20,00,000.00 or Rs. 1,500/- per vehicle of the entire fleet,
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whichever is less. The Undertaking has to maintain a cash deposit of