National Insurance Co. Ltd. vs Harjeet Kaur And Ors.
1995 Latest Caselaw 67 Del

JUDGMENT

C.M. Nayar, J.

(1) The present appeal arises out of the judgment dated 29th October, 1987 of Mrs. Mamta Sehgal, Judge, Motor Accident Claims Tribunal, New Delhi. The respondents/claimants have filed their cross appeal (2385/88) claiming enhancement of compensation awarded by the Tribunal and interest @ 12% per annum on the amount claimed w.e.f. the date of filing of the claim application till realisation. The brief facts of the case are that the deceased Shri Balbinder Singh, aged 44 years was working as Officiating in charge of Kendriya Vidyalya, Sadiq Nagar, New Delhi drawing a salary of Rs. 2300.00 per month approximately. On 29.11.1983 at about 12.30 per month the deceased was returning to his house on his two wheeler scooter bearing No. Hps 3206 and when he reached the Mool Chand Hospital crossing he stopped his scooter as there was a red light signal. The truck bearing No. Dhl 6348 being driven by respondent 5 came at a fast speed from behind and hit the scooter with its front portion. On account of the forcible impact the deceased was thrown away on the road and was crushed under the wheel of the truck. The impact of the accident was so great that the truck dragged the deceased to a considerable distance as a result of which he received fatal injuries. Respondent no. 5 is the driver of the truck, respondent no. 6 is the owner of the truck and the appellant herein being the insurer of the truck are liable to pay compensation to the legal heirs of the deceased. The necessary claim petition was filed before the Motor Accident Claims Tribunal and the same was disposed of by the judgment which has been impugned by the insurance company.

(2) It has been pleaded in the petition that the deceased was enjoying good health and a senior position and if he had not died in the accident he would have lived a long life and would have also become Principal in the same school where he was working. He has left behind his widow, his son.aged 8 years and one daughter 6 years respectively. Respondent no.1 who is the wife of the deceased Balbinder Singh filed the claim petition on her behalf as well as on behalf of the minor children Inder Deep Singh and Miss Gagan Deep Kaur. The mother of the deceased Smt. Prakash kaur subsequently died and her name has already been deleted from the array of parties vide order dated 21st September, 1988.

(3) The appellant as well as the owner of the vehicle respondent no.6 filed their respective written statements. They have admitted the occurrence of the accident but have denied the negligence. It has been pleaded that the driver of the truck, respondent 5 was driving the vehicle in a normal manner and the deceased over took the vehicle in a rash and negligent manner and reversed the scooter just in front of the truck and hence the appellant and respondents 5 and 6 are not liable to pay any compensation. The appellant further pleaded that the liability of the company is limited to the extent of Rs. 50,000.00 as laid down by the provisions of Section 95(2) of the Motor Vehicles Act, 1939. It is not disputed that there was a subsequent amendment and the limit was raised to Rs. 1,50,000.00 w.e.f. 1.10.1982. The Act was amended again and the provisions of Section 147(2) of the Motor Vehicles Act, 1988 provide that a policy of insurance shall cover any liability in respect of any accident for the amount of liability incurred.

(4) The parties filed their respective pleadings and the following issues were framed:    1)whether the petitioners are the LRs of the deceased? 2) whether the liability of the insurance company is limited? 3) whether the petition is bad for non-joinder of necessary parties? 4) whether the accident took place due to rash and negligent driving on the part of the respondent no. I while driving vehicle no. Dhl 6348 and caused the death of Balbinder Singh deceased? 5) to what amount of compensation, if any, are the petitioners entitled and from whom? 6) Relief.  

(5) The appellant as well as respondents examined their respective witnesses and the following findings were given by the learned judge. Issue No. 1   

(6) The respondents/claimants were held to be legal heirs left by the deceased and as such were entitled to the claim for compensation. Issue No. 2.   

(7) I he learned counsel for the appellant has not denied the factum of the accident and the award of the compensation by the Tribunal. He has, however, reiterated that the liability of the insurance company is limited to Rs. 50,000.00 which subsequently was increased to Rs. 1,50,000.00 under the provisions of Motor Vehicles Act. Therefore, the company is not liable to pay to the respondents/claimants more than the amount as prescribed by legislation. It is admitted that the carbon copy of the insurance policy was not produced before the Tribunal and only a true copy of the same was filed. The learned counsel for respondents/claimants submitted that the appellant herein failed to prove the policy and only true copy has been placed on record which cannot be relied upon. Therefore, the liability of the company was unlimited. The Tribunal accepted the contention of the respondents/claimants and held that the liability of the insurance company was unlimited. The reason is contained in the following paragraph which may be reproduced as follows: "I have heard both the parties perused the statement of RW-1 Sh. D. D. Mahajan, Stenographer from National Insurance Company Ltd. He has proved Ex. RW-1/1 which is just a true copy. He is not a person who has issued the policy or has attested the true copy. In his statement it has come that a notice was given to the owner to the effect that he should produce the original in the court which he has failed to do. The postal receipt is Ex. RW-1/3 and Ad card is Ex. RW-1/2 and copy of the letter sent to the owner is Ex. Rw-l/4. From the perusal of the Ad card, I find there are initials of some B.R. Now the Ad is in the name of Shri Nandlal Baveja which was taken to be properly served to him. Even if the original policy was not available the carbon copy of the policy should have been filed by the insurance company. There is no explanation as to where is that carbon copy. It has also not come in the statement of the witness examined by the insurance company as to who prepared this Ex. RW- 1/1, true copy of the policy and from which document it was prepared on which date it was prepared. Nobody has attested this to be the true copy of the original. There is no endorsement on this document to show that it was either compared with the original. The proposal form which must have been filed has also not produced on record to show which cover was demanded and what was the exact premium paid by the owner. Simply because the stenographer from' the company who was neither the in charge nor the issuing authority of this document has been produced to prove the policy, no reliance can be placed on this document and his statement. The fact urn of insurance is admitted by the insurance company, I hold that the liability of the insurance company is unlimited."

(8) This issue was also decided in favor of the respondents/claimants and the finding is not impugned before me. Issue No. 4

(9) This issue was decided in favor of the respondents/claimants and it was held that the accident took place on account of rash and negligent driving on the part of the driver of the truck and the deceased Balbinder Singh sustained fatal injuries in the accident. The findings in this issue are also not challenged.

(10) The proceedings in the matter before the Tribunal concluded and the pronouncement of the judgment was fixed for 5th October, 1987 when the appellant filed a carbon copy of the alleged policy before the court. This was filed at a belated stage and the Award of the Tribunal was made on 29th October, 1987.

(11) The learned counsel for appellant has not denied the factum of the accident before me, he has not even impugned the award and has only contended that the liability of the company is limited to the amount of Rs.1,50,000.00 and the Tribunal had wrongly rejected the plea in this regard. There is no doubt that the appellant insurance company did not file a carbon copy of the insurance policy along with its defense. Firstly, the true copy of the policy was placed on record and the same was rejected by the Tribunal and there does not seem to be any infirmity in the reasoning of the Tribunal to warrant interference at this late stage. The carbon copy of policy was then produced on the date when the matter was listed for pronouncement of judgment. It was not explained at any stage as to why the same was withheld and how at a later date the appellant came in possession of the same. Therefore, it will not be in the interest of justice to allow the application of the appellant for permission to lead additional evidence to prove carbon copy of the policy which has now been produced particularly in view of the fact that the same was withheld from the court till the proceedings were concluded and the judgment was reserved. The unfortunate life has been lost leaving behind the young widow, two minor children and they have already waited long enough for judgment to be implemented when the accident took place as far back as 29th November, 1983. I am satisfied with the reasoning of the Tribunal and the contention of the learned counsel for insurance company is accordingly rejected.

(12) The insurance company is amply protected by the provisions of Section 149(5) of the Motor Vehicles Act, 1988 which is in pari materia to the earlier provisions as contained in Section 96(4) of the 1939 Act, the same reads as follows:    "IF the amount which an insurer becomes liable under this section to pay in respect of a liability incurred by a person insured by a policy exceeds the amount for which the insurer would apart from the provisions of this section be liable under the policy in respect of that liability, the insurer shall be entitled to recover the excess from that person. "  

The said position of law has been accepted by a judgment of this court as reported in The Oriental Fire and General Insurance Co. Ltd Vs. Mrs. Leelawati R. Adyanthaya and others (1976) 12 Dlt 163. The relevant passage from the judgment reads as follows:    "Mr. Monga has then pressed his second contention. It is correct that under Section 95(2) of the Motor Vehicles Act, (4 of 1939), it is provided that where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment (i) in respect of persons other than passengers carried for hire or reward, a limit of Rs. 20,000.00 in all and Rs. 4,000.00 in respect of individual passenger and etc. This limit has subsequently been raised in sub-section (i) to Rs. 50,000.00 but that is not material for the decision of the present case. However, under Section 96 sub-section (4) it is provided if the amount which an insurer becomes liable under this section to pay in respect of a liability incurred by a person insured by a policy exceeds the amount for which the insurer would apart from the provisions of the section be liable under the policy in respect of that liability, the insurer shall be entitled to recover the excess from that person. It is, therefore, obvious that the statutory minimum liability at the material date was Rs. 20,000.00 but there is nothing in the provisions of law to prevent the parties from contracting for an insurance to cover a large amount. In case the amount of insurance contracted between the parties is less than the amount for which the insurance company has been held to be liable, the insurance company is given a statutory right to recover the excess amount from the party. The insurance company, therefore, does not suffer any prejudice if it finds that its liability, on the face of the insurance policy if any, does not exceed Rs. 20,000.00 as under the law it would be entitled to recover the excess from the party to the insurance. Mr. Monga and Mr. Malhotra both counsel have further pointed out this provision of law is also reflected in the insurance policy and it contains a term to the effect that the insurer will repay to the company sums paid by the company which the company would not have a legal liability to pay. Under these circumstances, I find no substance in the contention that the award of the Tribunal below be modified or that it will cause any prejudice to the insurance company in respect of its claim on the basis of the insurance policy.  

(13) The appellant insurance company will, therefore, be at liberty to recovery the money from the insurer and this judgment will not stand in the way provided the company is able to establish that their liability is not unlimited.   

(14) For the aforesaid reasons there is no force in the appeal, which is dismissed with the above observations.   

(15) The legal heirs of the deceased have filed the cross appeal (2385 of 1988) and claimed enhancement of compensation to Rs. 5 lakhs which was the amount claimed in the claim petition. The following paragraph 4 from the grounds of appeal may be reproduced as follows:    "FOR that the learned Tribunal erred in law by not considering the fact that the deceased would have been entitled to increments and enhancement on revision of scale of pay. The deceased prior to the date of award would have been entitled to a salary of Rs. 3800.00 per month and would have been presently drawing a salary of Rs. 4300.00 per month as against Rs.2300.00 per month at the relevant time."  

(16) The claim for interest was also made @ 12% per annum on the amount claimed w.e.f the date of filing of the application till realisation. The learned counsel for the, appellants/claimants has argued that the multiplier of 16 used by the Tribunal was wrong and higher multiplier should be adopted in the facts and circumstance of the present case. Secondly, he has contended that the Tribunal has taken no note of the future advancement in salary and prospects of the deceased who would have reached the position of principal which obviously carried higher status and more emoluments. Reliance is placed on the judgment of this court as reported in jasbir Kaur & Ors. Vs. S. Sampuran Singh & 0rs. and it is contended that on similar facts a multiplier of 31 was used.

(17) On the other hand, the learned counsel for insurance company found no fault with the award and has argued that the compensation awarded in the present case is just fair and reasonable and the multiplier of 16 has been correctly assessed. He has further reiterated that the respondents did not lead any evidence with regard tQ the future prospects of the deceased and the advancement in his status and emoluments. The Tribunal was, therefore, right in not taking into. consideration any such future prospects.

(18) The Tribunal has no doubt come to the conclusion on the basis of the evidence on record that the carry home salary of the deceased was Rs. 2000.00 and taking into account the circumstances and the liability on his shoulders/it could safely be presumed that he spent Rs. 500.00 on himself. Therefore, on this basis adopting the multiplier of 16 the award of compensation amounting to Rs. 2,88,000.00 was considered a just compensation. The Tribunal, however, has not taken into account any advancement in the career of the deceased even if no evidence was led in this regard. The deceased might have retired as a principal or not retired as a principal but he would certainly have earned his annual increments as well as the increase in salary as a result of periodic revision by the reports of pay commissions. There has been no consideration which has been given on these counts. The learned counsel for the appellant/claimants has, therefore, argued that the Tribunal became oblivious of the fact that there have been upward revisions in the pay of the teachers and there was time bound consideration for promotion. He has relied on the judgment of the Supreme Court as reported in General Manager, Kerala State Road Transport Corpn. Vs., Susamma Thomas and Ors. 1994 Acj 1 where the deceased was 39 years of age and his income of R.s. 1032.00 per month was enhanced to Rs. 2000.00 as the gross income having regard to the prospects of advancement and the multiplier of 12 was considered appropriate to the age of the deceased. It is the accepted proposition of law that the deceased would spend at least one third of the salary on himself and the remaining two third he would be spending to support his family. The judgment of the Supreme Court in General Manager, Kerala State Road Transport Corpn. Vs.,Susamma Thomas and Ors. (supra) highlights the fact that the court can take into consideration the prospects of future advancement particularly when there is evidence on record. This loss of dependency should capitalize with the appropriate multiplier and the multiplier of 12 was used and the monthly income of the deceased was assessed at Rs.2000.00 instead of Rs. 1032.00 per month which he was currently earning. The judgment of the Supreme Court as reported in Hardeo Kaur and Ors. Vs. Rajasthan State Road Transport Corporation and anr. 1992 ACj 300 where the deceased was an army officer earning Rs. 2200.00 and was aged 36 years at the time of occurrence is of great relevance to the facts of the present case. He left behind his wife and two sons aged 10 years and 7 years respectively. The court came to the conclusion that the deceased was spending Rs. 1400.00 for his family and by using the multiplier of 24 awarded the compensation and assessed the amount of damages at Rs. 4,03,200.00. In the present case the multiplier of 16 does not seem adequate and a higher multiplier is called for particularly in view of the fact that the prospects and future advancement in the career have not been assessed. In this view, I am inclined to adopt the criteria as adopted by the judgment of the Supreme Court in Hardeo kaur and Ors. Vs. Rajasthan State Road Transport Corporation and anr. (supra) and will adopt the multiplier of 21. Therefore, the annual amount which the deceased was spending for his family comes to Rs. 18,000.00 (Rs. 1500.00 x 12) which multiplied by 21 comes to Rs. 3,78,000.00. I, therefore, assess the amount of damages in favor of the respondents/ claimants at Rs.3,78,000.00.

(19) The Tribunal has awarded interest at the rate of 12 per cent per annum from. the date of order till realisation only on the condition that in case the Insurance Company did not pay the awarded amount within three months, the same shall be payable along with interest. The learned counsel for the appellants/claimants, however, has contended that the interest should have been awarded at the rate of 12 per cent per annum from the date of application till realisation. The point of interest has also been referred in the judgment of the Supreme Court in Hardeo Kaur and others (supra) and paragraph 12 may be cited in this regard: "THE Tribunal has awarded interest at the rate of 6 per cent per annum from the date of filing of the application before the Tribunal till the date of realisation. In Chameli Wati v. Delhi Municipal Corporation, 1985 Acj 645 (SC), this court awarded interest at the rate of 12 per cent per annum from the date of the application. Similarly, in Jagbir Singh v. General Manager, Punjab Roadways, 1987 Acj 15 (SC) this court enhanced the interest from 6 per cent per annum to 12 per cent per annum. We, therefore, hold that apart from the damages the appellants are entitled to claim interest at the rate of 12 per cent per annum instead of 6 per cent awarded by the Tribunal."

(20) In view of the settled position of law and the facts and circumstances of the present case I hold that apart from the awarded amount the appellants/claimants are entitled to claim interest at the rate of 12 per cent per annum from the date of application till realisation. The learned counsel for the Insurance Company has stated that the amount of Rs.1,50,000.00 has already been paid. to the appellants/claimants in terms of the order dated November 20, 1987 of this Court. The appellants shall be entitled to interest on the amount, as awarded from the date of institution of the petition till realisation. The amount, which has already been paid, shall be taken into consideration to work out the amount of interest, which is now held payable to the appellant.

(21) The appeal is allowed with costs and the judgment of the Tribunal dated October 29, 1987, is modified to the extent indicated above. The costs are assessed at Rs.5,000.00.