Andhra Pradesh High Court - Amravati

Cholamandalam Ms General ... vs Jillelamudi Chandrakala 6 Others on 1 March, 2023

          HON'BLE SRI JUSTICE T.MALLIKARJUNA RAO

                   M.A.C.M.A. No.1312 OF 2015

JUDGMENT:

1. Aggrieved by the award and decree dated 27.01.2015 in M.V.O.P.

No.249 of 2013 passed by the Chairman, Motor Accidents Claims

Tribunal-cum-VII Additional District Judge, Ongole (for short, "the

tribunal"), whereby the Tribunal awarded compensation of

Rs.13,30,000/- with interest 9% per annum against the respon-

dents 1 and 2 and dismissing the claim against the respondents 3

and 4, the 2nd respondent, Cholamandalam MS.General Insurance

Company Limited, has preferred the present appeal.

2. For convenience, the parties herein will be referred to as per their

rankings in the M.V.O.P.

3. The claim is filed under Section 166 of the Motor Vehicles Act,

1988, for compensation of Rs.10,00,000/- on account of the death

of Jillelamudi Venkatswarlu (hereinafter referred to as 'the de-

ceased') in a road accident that occurred on 15.11.2012.

4. The 1st petitioner is the wife; the 2nd is the son, and petitioners 3

and 4 are the deceased's parents. The claimant's case is that on

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15.11.2012 at about 03.20PM, the deceased and one Unnam Ro-

saiah came to Addanki on a motorcycle bearing No.AP27AE3790

from their village Peda Ullagallu and while they returned to their

village at about 03.00 PM and when they reached to brick kiln of

Thokala Venkateswarlu at approximately 03.20 PM on Addanki-

Dasari road, one A.P.S.R.T.C. Hire Bus bearing No.AP27W8109 (he-

reinafter referred to as 'offending vehicle') came in opposite direc-

tion rashly and negligently and dashed the motorcycle, as a result,

the rider of bike Unnam Rosaiah died on the spot and the pillion

rider i.e., the deceased herein received multiple injuries, he was

shifted to Government Hospital, Addanki and from there to Sang-

hamitra Hospital, Ongole for better treatment, where deceased suc-

cumbed to injuries on 18.11.2012 at about 01.00 PM.

5. The 4th respondent remained exparte.

6. Respondents 1 to 3 filed their counters separately.

7. Respondents 1 to 3 denied the accident, age, income, or avocation

of the deceased; there was no negligence on the part of the offend-

ing vehicle's driver, but there was negligence on the part of the rid-

er of the motorcycle in which the deceased was a pillion rider. So

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the respondents are not liable to pay compensation. The 3 rd res-

pondent submitted that the owner of the bus entered into an

agreement with A.P.S.R.T.C., and as per Clause-IV of it, the owner

shall be responsible for all the claims that may arise due to statu-

tory violation.

8. Based on the pleadings, the Tribunal framed relevant issues. To

substantiate the claim on behalf of the claimant during the trial,

PWs.1 and 2 got examined and marked Exs.A.1 to A.20. On behalf

of the respondents, RW.1 got examined and attested Xerox copy of

agreement dt.10.07.2012 executed between the owner of the bus

and the A.P.S.R.T.C. marked as Ex.B.1.

9. After appreciation of the oral and documentary evidence, the Tri-

bunal held that the accident occurred due to the rash and negligent

driving of the offending vehicle's driver; the deceased died due to

the injuries sustained in the accident. Accordingly, the Tribunal

granted compensation of Rs.13,30,000/- with interest @ 9% p.a.

from the date of the petition till realization against respondents 1

and 2, and the claim was dismissed against respondents 3 and 4.

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Aggrieved thereby, the 2nd respondent has preferred the present

appeal.

10. I have heard the learned counsel appearing for both parties.

11. In the grounds of appeal, learned counsel for the 2nd respon-

dent/appellant contends that the Tribunal failed to see that there is

no proper evidence about the income and occupation of the de-

ceased; Tribunal failed to see that the claimant has not filed au-

thenticated documents like original passbook etc., The Tribunal

failed to see that supervisory capacities have to be ascertained

without loss of future prospectus; the Tribunal failed to see that

amount granted under non-pecuniary heads is also on the high

side. The medical bills are not proved by the petitioners. The Tri-

bunal ought to have passed a decree against respondents 3 and 4

also.

12. Per contra, learned counsel appearing for the respondents has

supported the findings and observations of the Tribunal.

13. Now, the points for determination are

Whether the quantum of compensation fixed by the Tribunal is just and reasonable ?

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POINT:

14. As seen from the grounds of appeal and submissions made on behalf

of the learned counsel for the appellant, the appellant has not dis-

puted the findings given by the Tribunal regarding the manner of the

accident and the death of the deceased due to injuries sustained in

the accident. In view of the same, the details of the manner of the

accident and evidence adduced on that behalf need not be referred

to and discussed in detail.

15. As seen from the grounds of appeal, the main dispute concerns the

quantum of the compensation amount and non-fixing the liability on

respondents 3 and 4.

16. It is not in dispute that Ex.B1 is the agreement executed between

the owner of the hired bus with the A.P.S.R.T.C. The driver of the

hired bus is not an employee of A.P.S.R.T.C. By giving a reason; the

Tribunal held that the Corporation is not liable to pay the compensa-

tion to the petitioner. As seen from the record, the claimants have

not questioned the award passed by the Tribunal on the ground that

liability is not fixed on respondents 3 and 4 in M.V.O.P. It is not the

case of the insurance company that the insurance policy for the of-

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fending vehicle was not in force at the time of the accident. The Tri-

bunal accepted the petitioners' case regarding the subsistence of the

valid policy at the time of the accident and fixed the liability on the

insurance company. As seen from the grounds of appeal, the insur-

ance company has not disputed the petitioners' case regarding the

subsistence of the insurance policy at the time of the accident.

17. In Rikhi Ram And Anr vs Smt. Sukhrania And Ors 1 , the Apex Court held that, "whenever a vehicle which is covered by the insurance policy is trans- ferred to a transferee, the liability of the insurer does not ceases so far as the third party/victim is concerned, even if the owner or pur- chaser does not give any intimation as required under the provisions of the Act."

18. The Hon'ble Full Bench of the erstwhile High Court of Andhra Pradesh ren-

dered in L.P.A. No.206, 207, 208 and 2019 of 2000 and 6 of 2002 and

batch dated 20.11.2012 wherein it was held at Para 94 of the said judg-

ment that the Insurance company is solely liable for payment of compensa-

tion in respect of vehicles engaged by the Corporation under the category of

acquired insured buses by the owners to the Corporation and it was ob-

served as follows:

"On the above analysis, we hold that mere hiring of insured buses by the owners to the A.P.S.R.T.C. would not in any manner limit the liability and accountability of the Insurance Companies, be it under the Act of 1988 or the Act of 1939, to honour passengers/third party risks covered by the Insur-

2003 ACJ 534 SC

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ance Policies issued by them in favour of the owners. Not-

withstanding the hiring of insured buses by the owners to the A.P.S.R.T.C., the Insurance Companies shall be solely and exclusively liable for payment of the compensation aris- ing out of such passengers/third party claims unless any of the grounds in Section 149 (2) of the Act of 1988/Section 96 (2) of the Act of 1939 are made out. We therefore affirm the view taken by the Full Bench of this Court in MADINENI KONDAIAH AIR 1986 A.P. 62 (F.B.) and applied thereafter in RIKHI RAM AIR 2003 SC 1446 = (2003) 3 S.C.C. 97=2003 ACJ 534. We answer the question referred to us for decision accordingly. All the matters shall be placed before the appro- priate Courts for individual adjudication."

Similarly, the Hon'ble Apex Court in Civil Appeal No.18490, 18491

of 2017, dated 14.07.2021 also held that the Insurance company is li-

able to pay the compensation amount when the acquired buses of the

Corporation were involved in the accident on the ground of vicarious

liability. It was held as follows:

"The question that falls for our consideration in the instant ap- peal is: if an insured vehicle is plying under an agreement with the Corporation on the route as per permit granted in favour of the 3 Corporation and in case of any accident during that pe- riod, whether the Insurance Company would be liable to pay compensation or would it be the responsibility of the Corpora- tion or the owner? This question has been answered by this Court in Uttar Pradesh State Road Transport Corporation v. Ku- lusum and Others, (2011) 8 SCC 142, which is an identical case where the Supreme Court examined the agreement en- tered into between the Corporation and the owner of the ve- hicle. The Court has come to the conclusion that when the effec- tive control and command of the bus is with the Corporation, the Corporation becomes the owner of the vehicle for the speci- fied period. It was further held that when the actual possession of the vehicle is with the Corporation, the vehicle, the driver and the conductor were under the direct control and supervision of

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the Corporation. Therefore, through the definition of "vicarious liability," it can be inferred that the person supervising the driv- er is liable to pay the compensation to the victim. During such time, however, it will be deemed that that vehicle was trans- ferred along with the insurance policy, even if it was insured at the instance of the original owner. Thus, the Insurance Compa- ny would not be able to escape its liability to pay the amount of compensation."

Similarly, the Hon'ble Supreme Court in Civil Appeal Nos. 5901 of

2011 and batch dated 25.07.2011 held that the Insurance company

only is liable to pay the amount of compensation to the claimants.

19. In Uttar Pradesh State Road Transport Corporation v. Kulsum &

Ors.,2 the Apex Court held that

"If the Corporation had become the owner even for the spe- cific period and the vehicle having been insured at the in- stance of the original owner, it will be deemed that the ve- hicle was transferred along with the Insurance Policy in existence to the Corporation and thus Insurance Company would not be able to escape its liability to pay the amount of compensation."

20. Keeping in mind the principle laid down by the Apex Court, after

careful reading of the record, this Court finds that it is not the case of

the insurance company that there has been any violation of the terms

and conditions of the policy. It has also failed to point out the viola-

tions of any Act, Rules or conditions of the insurance company.

(2011) 8 SCC 142

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Therefore, the Insurer has no legal justification for denying compen-

sation to the claimants. The 1st respondent had insured the offending

vehicle to meet the such liability, which may arise on account of the

use of the vehicle.

21. It is not in dispute that the offending vehicle was under the absolute

control of the Corporation, and the original owner did not part with

the ownership of the vehicle. In other words, there is no cessation of

the relationship between the vehicle and its original owner.

22. In similar facts of the case, in a case between A.P.S.R.T.C., Mushira-

bad, Hyderabad V. Kanche Nagabhushanam @ Bhushanam and

others3 this Court observed that

29. Even in such cases, it is to be remembered that there is no cessation of the privity of contract between the original owner and the Insurer through a policy. In other words, even in case of transfer of ownership, in any manner, so long as the policy is in force covering certain risks, notwithstanding the possession of the vehicle or the nature of possession, the liability of the Insurer cannot be held to be ceased to the ex- tent of its liability against third parties only as postulated under Section 157 of the new Act. This position has been made clear by the apex Court in United India Insurance

(2007) 6 ALT 627

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Company Ltd., Shimla v. Tilak Singh, 2006 (3) A.L.D. 75 (S.C.): 2006 (1) D.T. (SC) 479.

30.....

31....

32....

33. Unless and until the obligation of indemnification on the part of the Insurance Company is divested by way of an ex- press agreement between the owner and the hirer, the said obligation on the part of the Insurer will not get ceased. Fur- thermore, the conditions of the insurance policy would al- ways remain unless they are specifically excluded by way of a separate agreement between the owner, hirer and the In- surance Company. In other words, the Insurance Company must be a party to a tripartite agreement, but not a bipartite settlement between the owner and the hirer. Any such agreement does not absolve the Insurer from its liability of indemnification. The same thing may happen by an indepen- dent agreement between the owner and the hirer excluding the Insurer's liability as in Kailash Nath Kothari's case (su- pra)."

23. It is not the case of the appellant that the obligation of the indemni-

fication on the part of the appellant is divested by way of the Ex.B1

Agreement entered in between 1st respondent and respondents 3

and 4 in M.V.O.P.

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24. By following the principles and considering the legal position, this

Court views the Tribunal has justified in fastening the insurance

company's liability. Given the above-settled legal position, the Or-

der passed by the Tribunal insofar as indemnification of the claim

against the insurance company against the offending vehicle is to

be confirmed.

25. The insurance company has questioned the award on the ground

that there is no proper evidence about the income and occupation

of the deceased. The claimant has not filed authenticated docu-

ments like the original passbook and the Tribunal failed to see that

Supervisory capacity has to be ascertained without loss of future

prospectus.

26. The Tribunal has accepted Ex.A6 and A7 pattadar passbooks and

found that the petitioners have agricultural land of Ac. 09.46 cents.

It negatives the contention of the appellant that the petitioners

have not filed authenticated documents pertaining to the lands.

However, the Tribunal assessed the income of the deceased at

Rs.72,000/- per annum.

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27. In a decision reported in D.Vinoda Vs. B.Basava Raju4, after referring to as

many as 17 cases of various High Courts summarized the principles regarding

estimated damages on the death of an agriculturist as under. "in the case of

death of an agriculturist owning agricultural land, the value of the 'supervisory'

services of the deceased have to be first estimated. This will not be merely equiv-

alent to the value of the services of a farm servant or a manager of the property

employed for that purpose. It will be more than that because an owner-manager

takes extra care in increasing the income year by year and also in increasing the

value of the property. After thus estimating the 'special' value of the supervisory

services of an 'owner-manager', a deduction is to be made in respect of the money

the deceased would have spent for himself out of such sum and then the annual

contribution to the family is to be arrived at. Then an actuarial multiplier suitable

to the age of the deceased has to be applied".

28. In the facts of the case, this Court views that the Tribunal should

have assessed supervisory loss instead of granting compensation

based on income. The claimants have not filed the authenticated

documents showing the exact income of the deceased. Since the

deceased happened to be an agriculturist, it is not possible to pro-

duce such evidence.

1988 ACJ 1072

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29. To consider the loss of earnings is concerned, in Lakshmi Devi and

others Vs. Mohammad Tabber5, the Apex Court laid down a prin-

ciple that, in today's world, even common labour can earn Rs.100/-

per day. Following the principles laid down by the Apex Court, in

D.Vinoda's Case and Lakshmi Devi's Case, this Court views that

the monthly income including supervisory loss can be assessed at

Rs.5,500/-.

30. In National Insurance Company vs Paranay seti6, the Apex Court held that in

case the deceased was self-employed, an additional 40% of the established in-

come should be the warrant where the deceased was below the age of 40 years.

The finding of the Tribunal that the age of the deceased is 28 years as of the

date of the accident is not disputed. Given the same, the annual earnings of the

deceased, including a future prospectus, can be assessed at Rs.5,500/+ 40% =

Rs.7,700/-. Since petitioners 1 to 4 depending on the deceased's earnings, the

Tribunal rightly deducted one-fourth (1/4th) of his earnings towards personal

and living expenses. Thus, the monthly earnings of the deceased after deduct-

ing personal expenses arrived at Rs.7,700/- X 1/4 = Rs.1925 /- i.e., Rs.7700/-

- 1925/- = Rs.5,775/-.

2008 ACJ 1488

2017, ACJ 270

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31. As per "Sarala Varma's case and others Vs. Delhi Corporation and another7,

the appropriate multiplier applicable to the age group of 26 to 30 is '17'. After

deducting 1/4th amount, the net income of the deceased, which can contribute

to the family, arrived at Rs.5775/- and when multiplied by 17, the loss of de-

pendency came at Rs.11,78,100/- (5775x12x17). Rounded off to

Rs.11,78,000/-.

32. In Magma General Ins. Co.Ltd., V.Nanu Ram8, the Apex Court held that: "The

Motor Vehicles Act is a beneficial and welfare legislation. The Court is duty-

bound and entitled to award 'just compensation, irrespective of whether any

plea on that behalf was raised by the claimant. A constitution Bench of Hon'ble

Apex Court in Pranay Sethi 2017 ACJ 2700 (S.C.) dealt with the various heads

under which compensation is to be awarded in a death case. One of these

heads is the loss of consortium.

33. In legal parlance, "consortium' is a compendious term which encompasses

'spousal consortium ''parental consortium', and 'filial consortium'. The right to

consortium would include the company. Care, help, comfort, guidance, solace

and affection for the deceased, which is a loss of his family. For a spouse, it

would include sexual relations with the deceased spouse [Rajesh v. Rajbir

Singh9. The parental consortium is granted to the child upon the premature

2009 ACJ 1298

2018 ACJ 2782 (S.C.)

2013 ACJ 1403 (S.C

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death of a parent, for loss of 'parental aid, protection, affection, society, discip-

line, guidance and training.

34. In Pranay Sethi, the Hon'ble Supreme Court has awarded a total sum of

Rs.70,000/- under conventional heads, namely, loss of estate, loss of consor-

tium and funeral expenses. It was held that the sum should be enhanced at 10

per cent every three years. It was held thus in para 61: "(viii) Reasonable figures

under conventional heads, namely loss of estate, loss of consortium and funeral

expenses should be Rs.15,000/-, Rs.40,000/- and Rs.15,000/- respectively.

The aforementioned amounts should be enhanced at the rate of 10 per cent in

every three years". The Judgment in Pranay Sethi was rendered in the year

2017. Therefore, the claimants are entitled to a 10 per cent enhancement.

Thus, a sum of Rs.16,500/- each is awarded towards loss of estate and funeral

expenses. Therefore the appellants are entitled to compensation as under

i. Towards loss of dependency: Rs. 11,78,000/-

                   ii.    Loss of estate:                  Rs.     16,500/-
                   iii.   Funeral expenses:                Rs.     16,500/-
                   iv.    Loss of spousal consortium:      Rs.     44,000/-
                   v.     Loss of parental consortium:     Rs.     44,000/-
                   vi.    Loss of Filial consortium:       Rs.     31,000/-
                                                           ---------------------
                                                    Total: Rs. 13,30,000/-
                                                            ---------------------

35. In Laxman @ Laxman Mourya v. Divisional Manager, Oriental

Insurance Company Limited and another 10 the Apex Court while

(2011) 10 SCC 756

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referring to Nagappa v. Gurudayal Singh11 held as under:

"It is true that in the petition filed by him under Section 166 of the Act, the appellant had claimed compensation of Rs.5,00,000/- only, but as held in Nagappa v. Gurudayal Singh (2003) 2 SCC 274, in the absence of any bar in the Act, the Tribunal and for that any competent Court is entitled to award higher compensation to the victim of an accident."

36. In Ramla vs National Insurance Co. Ltd.,12 the Apex Court held no

restriction to award compensation exceeding the amount claimed.

Given the principle laid down by the Apex Court, the claimants are

entitled to Rs.13,30,000/- exceeding the claimed amount. However,

the claimants shall pay the requisite court fee over and above the

compensation awarded.

37. Following the principles laid down by the Apex Court in a catena of

judgments, this Court can safely be concluded that the claimants

are entitled to get more amount than what has been claimed. Fur-

ther, the Motor Vehicles Act is a beneficial piece of legislation where

the interest of the claimants is a paramount consideration. The

Courts should always endeavour to extend the benefit to the clai-