United India Insurance Company ... vs Rehana Begum W
2008 Latest Caselaw 153 Bom

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         IN THE HIGH COURT OF JUDICATURE AT BOMBAY
                   NAGPUR BENCH, NAGPUR




                                                                        
                    FIRST APPEAL NO. 395/2001




                                                
    United India Insurance Company Ltd.,
    Divisional Office No.1,
    Saraf Chambers, Sadar,
    Nagpur,




                                               
    Through its' Official Signatory,
    Legal Cell                               APPELLANT
                                             Org.Non-applicant No.2




                                        
                     ...versus...

    1.
                        
          Rehana Begum wd/o Ashfaque Abdul Gaffar Ansari,
          aged about 34 years, Occ. Household.
                       
    2.    Ershad Ahamed S/o Ashfaque Abdul Ansari,
          aged about 27 years, 7 months.
      

    3.    Naushad Ahamed S/o Ashfaque Abdul Ansari,
          aged about 20 years, Occ. Education.
   



    4.    Gulshad Ahamed S/o Ashfaque Abdul Ansari,
          aged about 16 years, Occ. Education.





    5.    Dilshad Ahamed S/o Ashfaque Abdul Ansari,
          aged about 12 years,

    6.    Shamshad Begum d/o Ashfaque Ahmad,
          aged about 10 years





    7.    Rukshad Begum d/o Ashfaque Ahmade,
          aged about 8 years,

          Respondent no.4 being minor,
          represented by Mohd. Israr s/o Mohd. Shafi,
          R/o. sewani Nagar, Kanhan, Tah. Parseoni




                                                ::: Downloaded on - 09/06/2013 13:37:33 :::
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           Respondent Nos. 5 to 7 being minors,
           represented through their natural




                                                                          
           guardian - mother.




                                                  
           Rehana Begum wd/o Ashfque Abdul
           Gaffar Ansari,
           Respondent No.1 herein,




                                                 
           All resident of Warispura, Kamptee,              RESPONDENTS
           District Nagpur.                                 Applicants on RA




                                         
    8.     Satnamsingh s/o Gurusharansingh Puri,
           Aged Major, Occ. Truck Owner,
                          
           R/o Mohan Chowk,
           Kamptee, Distt. Nagpur.                          Org.N.A. No.1
                         
         ======================================

Shri S.N.Dhanagare, Adv. for the appellant. Shri A.J.Pophaly, Adv. for Respondent Nos. 1 to 7

Shri S.Y.Deopujari, Adv. for Respondent no.8 =================================

CORAM : S.R.DONGAONKAR, J JUDGMENT RESEVED ON : 17/7/2008 JUDGEMENT PRONOUNCED ON : 24/7/2008

1. By this appeal, the appellant - United India

Insurance Company Ltd., is seeking exception to the judgment

and award passed by the Member, Motor Accident Claims

Tribunal, Nagpur, in Claim Petition No. 74/1995, by which the

claim petition of respondent nos. 1 to 7 u/s 163-A of the Motor

Vehicles Act, 1988, was allowed and the respondent nos. 1 & 2

i.e. present appellant and respondent no.8 were directed to pay

the compensation of Rs. 5,30,000/- jointly and severally along

with the interest etc., besides the costs.

2. Brief facts leading to this appeal can be stated thus:-

One Ashfaque Abdul Gaffar Ansari, the husband of

Respondent no.1 and father of respondent nos. 2 to 7 was

returning to home on 23.10.1995 by his scooter. One truck

bearing registration No. MH-31/4157, owned by respondent

no.8 and insured with the appellant, gave dash to him,

resulting into his death. The respondent nos. 1 to 7 i.e.

applicants claimed that he was the only earning member in the

family. His age at the time of death was 43 years. He was

drawing monthly salary of Rs. 5164/-. The claim application

was preferred under Section 163-A of the Motor Vehicles Act

and compensation to the tune of Rs. 6,00,000/- was claimed.

It was alleged that the driver of the truck was negligent in

driving the same which had caused the death of the said

Ashfaque. The details as required were furnished in the

petition.

3. The insurance of the said vehicle (truck) was

admitted. However, it was contended by the appellant that the

truck was driven by one Anthony Philip Fernandiz, who in fact

was the 'cleaner' of the said truck. It was claimed that

authorized driver was one Mohammad Kalim, however, at the

time of accident, he was not driving the said truck, but at that

time Anthony Philip Fernandiz, the cleaner was driving the said

truck without the consent of the said driver. Therefore,

according to the appellant, there was breach of conditions of

policy and as such the company is not liable to pay

compensation. The owner of the truck i.e. the present

respondent no.8 did not appear and contest the claim, so he

was proceeded exparte.

4. Learned trial Judge recorded the evidence led by the

claimants i.e. of respondent no.1 herself and one witness Shri

Anant Fanibhare of Electricity Department, who had come to

depose about the nature of services of deceased Ashfaque and

his monthly emoluments. The respondents therein did not lead

any evidence. The learned Member of the Motor Accident

Claims Tribunal came to the conclusion that petition should

partly succeed in view of the findings recorded by him. He has

held that decease Ashfaque had died due to vehicular accident

involving truck bearing Registration No. MH-31/4157 owned

by respondent no.8 herein and insured with appellant. He also

found that the age of the deceased was 45 years, 9 months and

22 days. His income was around Rs. 5,000/- per month and

the liability of paying the compensation was with the appellant

& respondent no.8. He applied the multiplier of 13 and found

that the present appellant and respondent no. 8 are liable to

pay compensation of Rs. 5,30,000 jointly and severally with

interest at the rate of 9% per annum from the date of the

petition. This award dated 3.5.2001 is under challenge in this

appeal.

5. Shri S.N.Dhanagare, learned counsel for the

appellant has submitted that the appellant is not liable to pay

the compensation. According to him, there was breach of

conditions in respect of insurance policy i.e. the truck should

have been driven by the authorized driver and as it is not the

case here, the insurance company would not be liable to pay

compensation. It is also submitted by him that the Panchnama

of the place of accident and AA form Exh. 38 does not show

that the truck was driven by the authorized driver. According

to him, in fact the driver of the said truck who was driving the

truck at the relevant time had died in the accident. The

Panchnama shows the name of the driver as Anthony Philip

Farnandiz, whereas the AA form shows the name of

Mohammad Kalim as driver of the said truck. According to him,

the owner of the said truck has purposefully remained absent,

in the proceeding. Therefore, the fact that the said truck was

being driven by authorized driver at the time of accident could

not be established. It was duty of the claimants to prove that

the truck was driven by authorized driver at the time of

accident and then only the liability on the Insurance Company

can be fastened. He has further submitted that as the claim

was under Section 163-A of the M.V. Act, the compensation

could not be awarded taking into account the income of

deceased for consideration of more than Rs. 40,000/- per

annum. As per 2nd Schedule in respect of Section 163-A of the

M.V.Act i.e. awarding of compensation on the basis of

structured formula cannot be awarded if the income of

claimant is more than Rs. 40,000/- per annum. According to

him, if at all it is awarded, the tribunal should have restricted

the claim to the maximum as provided under Section 163-A of

the M.V. Act. Therefore, according to him, the claim should

have been restricted to Rs. 3,90,000/- (with the multiplier of

15). Therefore, according to him, firstly as there was breach

of condition of the policy, the Insurance Company cannot be

made liable for this claim and in the alternative, it is submitted

that the claim should have been restricted to the maximum as

can be allowed under Section 163-A of the M.V. Act, with the

help of structured formula in second schedule.

5. As against this, Shri A.J.Pophaly, Advocate, for

respondent nos. 1 to 7 has contended that the appellant -

Insurance Company is liable in the present case inasmuch as it

or even the owner i.e. respondent no.8 did not discharge their

burden of proof. According to him, the appellant - Insurance

Company could have called respondent no.8 to enter into

witness box to state as to who was driving the truck at the

relevant time and whether Anthony Philip was his authorized

driver. Further, according to him, the insurance company

could have led the evidence in denial and as this is not done,

the Insurance Company would be liable for the present claim.

As regards restriction of claim under Section 163-A of the M.V.

Act, he has submitted that the learned Member of the Motor

Accident Claims Tribunal has rightly awarded the

compensation considering the income of the deceased. He has

also submitted that in the deserving cases, the claim can be

awarded more than what is provided under Section 163-A of

the M.V. Act on the basis of that formula. According to him, as

there was no cross examination to the claimants' witnesses, the

learned Member of the M.A.C.T. has awarded the

compensation rightly. Further, according to him, as the leave

under Section 170 of the M.V. Act was not taken by the

appellant, its appeal to reduce the compensation cannot be

considered as defence only under Section 149(2) of the

M.V.Act is available. Further according to him, the multiplier

as applied by the learned Member, M.A.C.T. was correctly

applied. Therefore, according to him, the appeal deserves to be

dismissed.

6. Shri S.Y.Deopujari, learned counsel for Respondent

No. 8 has submitted that there was no issue framed by the

learned Member, M.A.C.T. that driver of the truck was not

holding valid driving license, as such, the Insurance Company

can not take a stand that it is not liable to pay compensation

unless some one of its side enters into witness box to affirm the

breach of conditions of the policy. As such, according to him,

the Insurance Company was rightly held to be liable for the

awarded compensation.

7. I had specifically asked the learned counsel for the

respondents as to whether the respondents would prefer to

treat their application under Section 166 of the M.V. Act,

instead of Section 163-A of the M.V.Act. The specific

submission that was made by the learned counsel for the

respondents was that this is application under Section 163-A of

the M.V.Act. He also submitted that respondents do not want

that their application should be allowed to be converted under

Section 166 of the M.V.Act.

8. Turning to the first question as to whether the

Insurance Company i.e. appellant can raise a defence that the

said truck was not driven by the authorized driver at the time

of accident, and as such there was breach of terms & conditions

of the policy and therefore, Insurance Company is not liable to

pay compensation to the respondents, suffice it to say that the

appellant - Insurance Company has not led any evidence, nor

anybody from the side of the Company had entered into

witness-box to depose as to what were the terms & conditions

of the policy and how there was breach of the conditions. No

doubt, as a general condition, the vehicle at the time of

accident, for making the Insurance Company liable to the

claim, needs to be driven by the authorized driver or driver

having valid licence. Here, the instant case is such that

although there is assertion on the part of the appellant that

there was breach of condition as regards driving of the vehicle

involved in the accident by authorized driver, no evidence was

led to that effect. The Insurance Company did not summon the

owner of the said truck, nor the driver of the said truck who

was alive, to prove the said fact or for negativing the obvious

inference. This inaction on the part of the appellant would

speak volumes against their defence. Such lapse on the part of

Insurance Company would invite the liability as per award.

9.

Learned counsel for the respondents has rightly

relied on the judgments of this Court in 2007(1) TAC 86;

Rajan Baburao Patil and another vs. Smt. Nagarbai Sadhu

Pawar; 2002 (1) Mh.L.J. 179, Rajendra Raghunath Girme

vs. Pramila Dattu Surse and others; 2008(1) Mh.L.J 318,

United India Insurance Co. vs. Kamal Maroti Darekar. In

my opinion, this defence is not available to the appellant in this

appeal. Therefore, this contention of the appellant in this

appeal is far from acceptance.

10. Needless to state that if the appellant is entitled to

fasten the entire liability on respondent no.8 i.e. the owner of

the vehicle, the appellant would be required to satisfy the

award in the first instance and then recover the same from the

insured i.e. the owner. It is necessary to make it clear that in

the present circumstances of the case, such issue could not be

decided for want of suitable evidence on record. In fact,

appellant and respondent no. 8 both have failed to lead

suitable evidence on record to enable the learned Member,

M.A.C.T. to decide this issue. Therefore, I find that first the

appellant would be liable to satisfy the award and if at all the

appellant claims that the liability to pay the compensation in

this case was exclusively of respondent no. 8 i.e. owner of the

vehicle, the appellant would be at liberty to take appropriate

action available at law.

11. Turning to the question of compensation payable to

respondent nos. 1 to 7, it would be seen that the claim petition

of the respondents was under Section 163-A of the M.V. Act

and learned counsel for Respondent Nos. 1 to 7 has

categorically submitted that he does not want to convert his

petition under Section 166 of the M.V. Act, instead the

respondent would prefer to stay in the compass of Section

163-A of the M.V.Act. Admittedly, the learned Member of the

Tribunal has considered the income of the deceased to

Rs. 5000/- per month for awarding the compensation. He has

calculated the compensation as below.

The monthly salary of deceased Ashfque has been fixed at Rs. 5000/- per month and therefore, by multiplying his monthly salary by by 5000 x 12 x 13, the gross

figure comes to Rs. 7,80,000 and 1/3rd amount is to be reduced in consideration of the expenses which the

deceased would incurred towards maintaining himself had he alive. This 1/3rd figure comes to Rs. 2,60,000/-. Thus, the total compensation amount would be Rs.

5,20,000/- to which a conventional figure of Rs. 10,000/- by way of consortium will have to be added and this will comes to Rs. 5,30,000/- to which the claimants would be entitled in equal proportion.

He has applied the multiplier to be 13. He has accepted the

income of deceased at the rate of Rs. 5000/- per month, which

is obviously more than Rs. 40,000/- per annum. Therefore, his

calculation of compensation is clearly not in accordance with

the structured formula as laid down in 2nd Schedule (in respect

of Section 163-A of the M.V. Act).

12. In this context, it is necessary to see the observations

of the Apex Court in I (2004) ACC 728 (SC), Deepal

Girishbhai Soni & ors vs. United India Insurance Co. Ltd.,

Baroda, in which the Apex Court has considered the earlier

decision in (2001) 5 SCC 175 on the subject of scope of

Section 163-A of the M.V. Act. It is necessary to see the

relevant observations which are in paras 36 to 53 of the said

decision. Later in para 54 of the said Judgment, it has been

observed thus;

"We, therefore, are of the opinion that remedy for payment of compensation both under Sections 163-A

and 166 being final and independent of each other as statutorily provided, a claimant cannot pursue his remedies thereudner simultaneously. One, thus, must opt/elect to go either for a proceeding under Section

163-A or under Section 166 of the Act, but not under both."

Further, in para 64 of the said judgment, it has been observed thus;-

"We, therefore, are of the opinion that Kodala (Supra) has correctly been decided. However, we do not agree with the findings in Kodala (Supra) that if a person invokes provisions of Section 163-A, the annual

income of Rs.40,000/- per annual shall be treated as a cap. In our opinion, the proceeding under Section 163- A being a social security provision, providing for a distinct scheme, only those whose annual income is upto Rs. 40,000/- can take the benefit thereof. All other claims are required to be determined in terms of Chapter XII of the Act."

12. Here is the case where respondents opted

categorically for being within the compass of Section 163-A of

the M.V.Act. Therefore, in my opinion, the respondents can

not claim compensation more that what is provided by the

structured formula of the second schedule. I may add that

event appellant - Insurance Company has not asked for non

suiting the respondent for not preferring claim u/s 166 of

M.V.Act being not entitled to maintain application u/s 163 A of

M.V.Act. In view of the above, further, this being benevolent

welfare legislation, it would be rather injustice to ask for

respondents to again treat their claim/application u/s 166 of

M.V.Act, whose claim petition was of 1995. In my opinion,

they can be granted relief of lowest amount, that can be

awarded.

13. The respondents/claimants have contended that the

compensation awarded by the learned Member, M.A.C.T. was

correct. It is obvious that by considering the income of the

claimants more than Rs. 40,000/- per annum i.e. Rs.5000/- per

month for calculation of compensation, tribunal has landed

into error. Therefore, the compensation, even the provisions

are considered to be for the benefit of the claimants, for the

obvious reasons, more than what is provided under the second

schedule cannot be granted. In any case, as the claim was not

under Section 166 of the M.V.Act, it was facing rejection; for

Section 163-A of the M.V.Act remedy is not available for

persons having income more than Rs.40,000/- per annum. As

it is beneficial legislation, ig maximum provided under 2nd

schedule can be awarded, because it would be less than what

can be awarded u/s 166 of M.V.Act, instead of relegating the

parties again to go to the claims tribunal for fresh decision on

claim petition, more so because, appellant itself has fairly made

submission as regards quantum of compensation that can be

paid u/s 163 A of M.V. Act.

14. Turning to the contention of the learned counsel for

the respondents that as the leave under Section 170 of the

M.V.Act was not claimed by the appellant, the appellant

should not be allowed to object on the quantum of

compensation, for which he relied on some authorities.

Suffice it to say that in view of the decision of the Apex Court

in I (2004) ACC 728 (SC) Deepal Girishbhai Soni & ors vs.

United India Insurance Co.Ltd., Baroda, obviously the

impugned award would be illegal if that is allowed to stand.

When it is challenged by the appellant, its legality has to be

considered while deciding the appeal. Therefore, in my

opinion, this contention would be available to the appellant

even though leave under Section 170 of the M.V. Act was not

sought in the compelling circumstances. Even otherwise, it was

made respondent in the claim petition, therefore, without

dilating on this aspect, suffice it to say that as calculated claim

u/s 163A of M.V. Act is less than the possible awardable claim

u/s 166 of M.V.Act, in the instant case, in view of stand of the

appellant, it can be granted.

15. Thus, it would be seen that the award of the learned

trial Judge suffers from illegality as regards determining the

total compensation in the instant case. The proper

compensation would be maximum that can be ordered under

Section 163 A of the M.V.Act following the second Schedule.

Thus, considering the age of deceased to be more than 45 years

as found by the learned trial Judge, the compensation payable

as per the second schedule would be Rs.4,80,000/-. The claim

would be reduced by 1/3rd by taking into consideration the

expenses which the victim would have incurred towards

maintaining himself had he been alive. Hence, the

compensation payable would be Rs.3,20,000/-. Besides this,

the claimants would be entitled for Rs. 2,000/- towards funeral

expenses, Rs.5,000/- towards loss of consortium and Rs.

2,500/- towards loss of estate. Thus in all, the respondents

would be entitled to Rs. 3,29,500/-. Needless to mention that

there is no challenge to the shares of the claimants as

determined by the learned Member, M.A.C.T. Therefore, the

said order shall be maintained. In this view of the matter, I

need not refer to the other authorities cited by the parties.

15. In sequel, this appeal will have to be partly allowed.

Accordingly, it is partly allowed. The judgment and award

dated 3.5.2001, passed by the Member, Motor Accident Claims

Tribunal, Nagpur, in Claim Petition No. 74/1995 is modified

as under.

The appellant and respondent no.8 shall jointly and

severally liable to pay Rs. 3,29,500/- as compensation together

with interest at the rate of 9% per annum from the date of

filing the claim petition till its full and final payment. The

distribution of the compensation shall be in proportion as

ordered by the tribunal.

Respondent Nos. 3 to 7 being minors, their shares

shall be invested in any Nationalized bank in F.Ds. till they

become major with the direction that the interest accrued may

be paid to their guardians Respondent No.1 on preferring

necessary application to withdraw that amount for the

maintenance of the concerned respondents.

The remaining amount, if any, deposited by the

appellant, which is not payable to the respondent nos. 1 to 7 in

pursuance to the above order shall be refunded to the appellant

by account payee cheque to be drawn in its name.

In the circumstances of the case, there would be no order as to costs.

JUDGE Rvjalit