National Insurance Co. Ltd. vs Nirmal Kaur & Ors.
2010 Latest Caselaw 2740 Del

                                         -
     *             IN THE HIGH COURT OF DELHI AT NEW DELHI


                                                              Date of Reserve: May 17, 2010
                                                                 Date of Order: May 24, 2010
+ MAC APP 112/2010
%                                                              24.05.2010
      National Insurance Co. Ltd                         ...Appellant
     Through: Mr. Pradeep Gaur and Mr. Amit Kumar Pandey, Advocates

         Versus

         Nirmal Kaur & Ors.                                                 ...Respondents
         Through: Mr. B.S. Randhawa, Advocate for R-1 and 2


         JUSTICE SHIV NARAYAN DHINGRA

1.       Whether reporters of local papers may be allowed to see the judgment?

2.       To be referred to the reporter or not?

3.       Whether judgment should be reported in Digest?


         JUDGMENT

1. The present appeal has been filed by insurance company assailing an award

dated 10th November 2009 passed by learned Tribunal whereby the learned Tribunal

granted compensation of Rs.6,30,000/- with interest @ 7.5 per annum to the

claimants.

2. The sole ground of assailing the award is that the claim petition was converted

at the request of claimants from one under Section 166 and 140 to Section 163A of

Motor Vehicles Act. However, while awarding compensation, the Tribunal has given a

complete go-by to Section 163 A of the said Act and calculated compensation in

accordance with Section 166 of the Act. It is submitted that under Section 163A of the

Act, the maximum annual income of a person can be taken as Rs.40,000/- and

compensation can be awarded only in accordance with Schedule specifically made

under Section 163A and compensation cannot be awarded taking into account any

other parameters.

3. There is no dispute that the claim petition initially filed under Section 166 and

MAC APP 112/2010 National Insurance Co. Ltd. v. Nirmal Kaur & Ors. Page 1 Of 4 140 was converted under Section 163 and for this reason the learned Tribunal

observed that the issue as to whether the offending vehicle was rash and negligent

need not be gone into. However, while calculating compensation, the learned

Tribunal took monthly salary of deceased as Rs.4,906.5/- and applied every

parameters as laid down in Smt. Sarla Verma v Delhi Transport Corporation 2009 ACJ

1298. The Tribunal also awarded Rs.50,000/- towards love and affection, Rs.5,000/-

towards loss of estate and Rs.25,000/- towards funeral expenses. Thus, the Tribunal

awarded total amount of Rs.6,30,000/- to the claimants.

4. The Supreme Court in Oriental Insurance Co. Ltd. etc. vs. Hansrajbhai V.Kodala

and Ors. etc. etc, 2001 ACJ 827, observed as under:

"14. ............It is also apparent that compensation payable under Section 163A is almost based on relevant criteria for determining the compensation such as annual income, age of the victim and multiplier to be applied. In addition to the figure which is arrived at on the basis of said criteria, schedule also provides that amount of compensation shall not be less than Rs.50,000/-. It provides for fixed amount of general damage in case of death such as (1) Rs.2000/- for funeral expenses (2) Rs.5000/- for loss of consortium if beneficiary is the spouse (3) Rs.2400/- for loss of estate (4) for medical expenses supported by the bills, voucher not exceeding Rs.15000/-. Similarly, for disability in non-fatal accident para 5 of the Schedule provides for determination of compensation on the basis of permanent disability. Para 6 provides for notional income for those who had no income prior to accident at Rs.15000/- per annum. There is also provision for reduction of 1/3rd amount of compensation on the assumption that the victim would have incurred the said amount towards maintaining himself had he been alive..........................................................................................

.................. However, this benefit can be availed of by the claimant only by restricting his claim on the basis of income at a slab of Rs.40,000/- which is the highest slab in the Second Schedule which indicates that the legislature wanted to give benefit of no fault liability to a certain limit. This would clearly indicate that the scheme is in alternative to the determination

MAC APP 112/2010 National Insurance Co. Ltd. v. Nirmal Kaur & Ors. Page 2 Of 4 of compensation on fault basis under the Act. The object underlining the said amendment is to pay compensation without there being any long drawn litigation on an predetermined formula, which is known as structured formula basis which itself is based on relevant criteria for determining compensation and the procedure of paying compensation after determining the fault is done away."

5. Section 163A itself is very clear that compensation under this Section

has to be granted as indicated in Second Schedule to the legal heirs and

victims. The Second Schedule is a part of Section 163A and cannot be ignored

and could not have been ignored by the Tribunal. It is categorically stated in

Second Schedule that the amount of compensation arrived at on the basis of

this Table has to be reduced by 1/3rd which the victim would have incurred

towards maintaining himself had he been alive. I, therefore, consider that the

Tribunal went wrong when the Tribunal took into consideration the income of

deceased more than Rs.40,000/- per annum and calculated damages as per

this income. The Second Schedule provides the scale of general damages as

well. The Courts are bound by Second Schedule and cannot grant damages

more than the statutory damages.

6. In view of specific provisions of Section 163A, I find that the award

passed by the Tribunal needs to be modified. Even if the maximum income of

deceased is taken as Rs.40,000/- per annum since the mother of deceased

was aged 43 years, a multiplier of 15 would apply in accordance with Second

Schedule. Thus, the total compensation payable to claimants would be

Rs.40,000 X 15 = Rs.6,00,000/-. Out of this, 1/3rd has to be deducted for his

personal expenses in terms of Second Schedule and also as per Smt. Sarla

Verma's case (supra). Thus, the compensation awardable to the claimants

would have been Rs.4,00,000/-. To this, general damages were to be added as

Rs.5,000/- towards funeral expenses. No amount could be awarded towards

MAC APP 112/2010 National Insurance Co. Ltd. v. Nirmal Kaur & Ors. Page 3 Of 4 consortium, since the claimant was not the spouse but the mother. However,

Rs.2500/- towards loss of estate were grantable. No other general damages

could have been considered by the Tribunal. Thus, the total amount payable

would be Rs.4,07,500/- along with interest @ 7.5% as against the amount

awarded by the Tribunal. Out of this amount, interim compensation, if already

received by the claimants has to be reduced.

7. The award of Tribunal is modified. The claimant would be entitled

Rs.4,07,500/- with 7.5% simple interest.

8. The appeal is allowed to above extent.

May 24, 2010                                                SHIV NARAYAN DHINGRA J.
rd




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