Parvinder Singh & Anr vs Saroj Nakra & Ors
2016 Latest Caselaw 537 Del

*      IN THE HIGH COURT OF DELHI AT NEW DELHI

                                         Reserved on : 15th January, 2016
                                       Pronounced on : 25th January, 2016

+      FAO 245/1998

       SAROJ NAKARA & ORS                                    ..... Appellants
                    Through                 Mr. Navneet Goyal, Adv.

                              versus

       SURINDER SINGH & ORS                             ..... Respondents
                    Through                 Mr. B K Sood, Mr. Gaurav Garg
                                            and Mr. Shivam Rawat, Advs. for
                                            R-2
                                            Mr. Sahil Paul, Adv. for R-5

+      FAO 451/1998

       PARVINDER SINGH & ANR                  ..... Appellants
                    Through  Mr. B K Sood, Mr. Gaurav Garg
                             and Mr. Shivam Rawat, Advs. for
                             A-2

                              versus

       SAROJ NAKRA & ORS                                ..... Respondents
                    Through                 Mr. Navneet Goyal, Adv. for R-1
                                            & R-4
                                            Mr. Sahil Paul, Adv. for R-6
CORAM:
HON'BLE MR. JUSTICE R.K.GAUBA

                              JUDGMENT

R.K.GAUBA, J :

1. On 24.07.1982, Yash Pal Nakra, aged 34 years (born on 12.04.1948), an employee of Central Ground Water Board, Ministry of

Irrigation and Power, Government of India, met with an accident at about 4 PM while driving his motorcycle No.PUB-5835 ("the motorcycle") when it was hit by a half body truck bearing registration No.DHG-5409 ("the truck") at the junction of roads in the area of General Store, Ring Road, Shalimar Bagh and died as a result of injuries suffered. His legal heirs (claimants), appellants in FAO No.245/1998, also then including the parents (Sushila Nakra and Satya Pal Nakra) preferred an accident claim petition before the Motor Accident Claims Tribunal ("the Tribunal") on 14.10.1982 under the provisions of Motor Vehicles Act, 1939, ("MV Act, 1939"), as then in force. During the pendency of the inquiry into the said claim petition, registered by the Tribunal as suit No.225/1982, the father and mother of the deceased expired on 28.03.1991 and 05.02.1996 respectively, their names having been later deleted from the array of parties. The claim petition impleaded M/s Narinder Singh Parvinder Singh, a partnership firm and its individual partners Narinder Singh and Parvinder Singh as second, third and fourth respondents, they being the registered owner (collectively, "the owner") of the truck ("the offending vehicle"). It was alleged that the offending vehicle was driven at the relevant point of time by Surinder Singh (first respondent before the Tribunal) in rash/negligent manner. The truck was stated to be insured with M/s New India Assurance Company Ltd., arrayed as fifth respondent in the claim petition which, thus, was stated to be statutorily and contractually liable to pay the compensation for the death caused by the principal tort-feasor ("the driver"), in which regard the owner of the offending vehicle (second to fourth respondents in the claim petition) were also vicariously liable.

2. After inquiry into the claim petition, the Tribunal passed the judgment dated 23.03.1998 awarding compensation in the sum of ₹1,98,900/- in favour of the claimants adding the interest payable at 12% per annum from the date of filing of the petition till realisation. The Tribunal upheld the contention of the insurance company ("the insurer") to the effect that in terms of the policy taken out by the owner of the truck, its liability was limited to pay only ₹50,000/-, with proportionate interest, on account of third party risk. Thus, the insurer was directed to pay the amount of ₹50,000/- with proportionate interest while the owner of the offending vehicle was directed to pay the balance to the claimants. It may be added that following the directions of the Supreme Court in the case of Kerala State Road Transport Corporation V. Susamma Thomas (1994) 2 SCC 176, suitable conditions were attached to the award to protect the interest of the compensation granted.

3. The claimants preferred appeal (FAO 245/1998) expressing grievance that the compensation awardable has been under assessed. Enhancement of the compensation is sought by them mainly on the grounds that personal and living expenses of the deceased were wrongly worked out at 1/3rd of the income earned since, having regard to the number of dependants in the family, which included the wife, three children and the parents, the deduction on account of personal and living expenses should have been made only to the extent of 1/4 th, in which regard reliance is placed on the judgment in Sarla Verma V. Delhi Transport Corporation (2009) 6 SCC 121; for calculating the compensation the multiplier of 16 should have been applied in view of the law settled in the case of Sarla Verma (supra), inasmuch as the deceased was hardly 34 years old at the time of his death; and that no

award was made under the customary non-pecuniary heads including loss of consortium for the wife, loss of love and affection for the children and rest of the family, funeral expenses and loss of estate.

4. The owner of the offending vehicle by way of their independent appeal (FAO NO.451/1998) have also sought to assail the impugned judgment/award. At the hearing on these appeals, it was submitted on their behalf that the deceased was also guilty of contributory negligence and that their contention in such regard has been wrongly rejected by the Tribunal.

5. Both the claimants and the owner in their respective appeals also submitted that given the tariff paid under the insurance policy, as brought out during the inquiry before the Tribunal, the liability of the insurer should not have been restricted to ₹50,000/- only. It is argued that in the facts and circumstances shown to exist, the insurer had failed to prove that its liability was limited and, thus, the entire award should have been directed to be paid by the said party respondent.

6. Per contra, the owners (appellants in FAO NO.458/1999) and the insurer (respondent in both the appeals), seek to defend the computation of compensation by the Tribunal in the impugned judgment submitting that there is no scope for further improvement or enhancement. The insurer, on its part, resists the submission of the claimants and the owner for it to be held accountable to pay the entire awarded compensation contending that its liability was limited in view of the tariff shown paid, referring in this context to the provision contained in Section 95(2)(b)(i) of MV Act, 1939.

7. The question of contributory negligence may be taken up first. As noted by the Tribunal in para 20 of the impugned judgment, the accident had occurred near a gap in the central verge from where the offending vehicle was trying to take a U-turn, after it had off loaded its cargo (sand) at a spot located about 30 feet away. The owner examined two witnesses namely Dilip Singh (RW1) and Narinder Singh (RW2) to prove that the motorcyclist i.e. the deceased had come at very high speed and was responsible for the accident. While RW2 is himself co-owner, RW1 was the contractor which had availed the services of the truck in the context of some construction work underway near the scene of accident.

8. The learned Tribunal considered the evidence to above effect but rejected the contention that the accident had occurred due to negligence on the part of the deceased, referring in this context to the evidence of the three witnesses examined by the claimants, namely Saroj Nakra (PW-5), I L Khanna (PW-8) and Mahender Singh (PW-10). PW-5, one of the claimants, wife of the deceased, was pillion rider on the motorcycle of the deceased at the time of the collision. Other two witnesses happened to be on the scene and had seen the accident in the course of occurrence. Their evidence clearly brought out that the truck had taken a U turn without taking necessary precautions vis-a-vis the traffic moving on the road. It had thus suddenly come in the way of the motorcycles resulting in the mishap.

9. In the considered view of this Court, the contention of contributory negligence about the deceased has been duly considered by the Tribunal and rejected for just and sufficient reasons. The said finding does not call for any interference.

10. In calculating the compensation, the Tribunal concluded, on the basis of evidence adduced, the multiplicand (the income of the deceased) at ₹1,910/- per month. There is no dispute raised to the correctness of the said computation. The deceased, as noticed above, was 34 years old at the time of his untimely death. The Tribunal adopted the multiplier of 13 for calculating the loss of dependency, referring in this context to the judgment in Susamma Thomas (supra). Having regard to the age of the deceased at the time of the death, the loss of dependency needs to be reworked on the basis of multiplier of 16. [Sarla Verma (supra)]

11. The Tribunal, in para 26 of the impugned judgment, proceeded on the assumption that the deceased would have been spending 1/3rd of his total income on his own upkeep, thus calculating the loss of monthly dependency at ₹1,275/-. In Sarla Verma (supra), the Supreme Court has ruled, which was reiterated in Reshma Kumari V. Madan Mohan (2013) 9 SCC 65, that in a case where the number of dependants was more than four but less than six, deduction on account of personal and living expenses should be to the extent of 1/4th. The award on loss of dependency, thus, needs to be recalculated taking into account the personal and living expenses restricted to 1/4 th of the income of the deceased.

12. In above view, the loss of monthly dependency works out to (1910 x ¾) ₹1433/-. The total loss of dependency which needs to be compensated is consequently calculated as (1433 x 12 x 16) ₹2,75,136/-.

13. It is clear from the bare perusal of the impugned judgment that no award was made under the non-pecuniary heads. The accident had occurred in 1982 and, thus, the rates at which non-pecuniary damages

have been awarded in death cases pertaining to the said period would be the proper rates to be followed. In Sarla Verma (supra) where the accident had occurred on 18.04.1988, the Supreme Court granted ₹5,000/- under the head of loss of estate, ₹5,000/- towards funeral expenses and ₹10,000/- to the widow for loss of consortium. Adopting similar rates, having regard to the fact that there has been loss of love and affection for the children and parents as well, non-pecuniary damages in the sum of ₹10,000/- on account of loss of consortium for the widow, ₹10,000/- for loss of love and affection for the children and parents, ₹5,000/- towards loss of estate and ₹5,000/- towards funeral expenses are also additionally awarded.

14. The total compensation payable in the case at hand in favour of the claimants, thus, is worked out at ₹3,05,136/-, rounded off to ₹3,05,200/-. The appeal of the claimants (FAO 245/1998), to the extent it prayed for enhancement of the award, is allowed to the effect that they shall be entitled to receive compensation in the sum of ₹3,05,200 (Rupees three lakh five thousand and two hundred).

15. The grievance has also been raised as to the rate of interest (12% per annum) imposed by the Tribunal. Indeed, it is irrational and unduly on the higher side. The rate of interest is reduced to 9% per annum from the date of filing of the petition till realisation. [Municipal Corporation of Delhi, Delhi V. Association of Victims of Uphaar Tragedy and Ors., (2011) 14 SCC 481; Surti Gupta V. United India Insurance Company and Ors., 2015 (3) SCALE 795; Basappa V. T. Ramesh, (2014) 10 SCC 789; Kumari Kiran V. Sajjan Singh (2015) 1 SCC 539 and Syed Sadiq etc. V. Divisional Manager, United India Ins. Company (2014) 2 SCC 735]

16. Following the dictum in Susamma Thomas (supra), the Tribunal had apportioned ₹25,000/- each as their respective share in favour of the children of the deceased (second to fourth appellant). Having regard to the period that has lapsed during the pendency of these appeals, and the fact that the children would have since come of age and settled in their respective lives, their shares are restricted to what was directed by the Tribunal. The balance amount of the enhanced compensation shall go in entirety to the first appellant (widow), 60% out of it to be put in fixed deposit receipt in her name in an interest bearing account for a period of five years with liberty to draw monthly interest therefrom.

17. The issue of the liability of the insurance company saw a contest before the Tribunal. It is essential to note the contentions raised and the evidence adduced, as indeed the view taken thereupon by the Tribunal in its own words. Thus, the following part of the impugned judgment needs to be extracted in extenso:

"29. R-5 M/s New India Assurance Co. in its WS had claimed that their liability was limited to a maximum of ₹50,000/- under the terms and conditions of the policy of insurance taken out by the insured. In order to prove this plea, they had produced R-5W1 Mahinder Singh an Assistant Manager of their company. Mahinder Singh testified that the company had served a notice through their counsel upon the insured to produce the original policy in the Court. The insured had failed to produce the original policy and therefore, he had brought the carbon copy of the said policy which was issued by him and bears his signatures. He claimed that the liability of the insurance company as per this policy was to the extent of ₹50,000/- and no additional premium for enhancement of risk had been charged by the company. The amount of premium had been charged as per tariff applicable

at the relevant time. He proved the carbon copy of the policy as Ex.RW-2.

30. In cross-examination he denied a suggestion that in case of third party insurance, the risk of the insurance company towards third party was unlimited. He also denied that as per the provisions of the tariff for the relevant period, the liability of the company was unlimited where a premium of ₹125/- was charged. He admitted that R-5W1/2 contained printed matter, carbon and rubber stamp and also admitted that whereas endorsement are attached in the standard form in the original policy, no such endorsement are attached in the carbon copy. He had not brought the proposal form in this case.

31. Cross-examined by R-2 to R-4, he denied a suggestion that the original insurance policy was returned by the insured to the company after the accident. He stated that R.S.Joher, who was still working in the company, had accepted premium for the vehicle and denied a suggestion that Ex.R5W1/2 was not the carbon copy of the insurance company. He also denied that the original policy in respect of this vehicle covered comprehensive risk.

32. It appears that the carbon copy of the insurance policy (Ex.RW2) which was placed on record by R5W1 Mahinder Singh when he was examined on 20.07.88 was misplaced / stolen from the record of this case. The order sheet dated 16.01.91 records that the copy of the policy proved on record by Sh. Mahinder Singh was not traceable. It was ordered that the document be reconstructed. Mahinder Singh was thus ordered to be recalled with the direction to produce another copy of the insurance policy.

33. His statement was again recorded on 12.10.92 wherein he stated that he was a Branch Manager of M/s New India Assurance Company during the period 81-82. He claimed that the company was not in possession of the carbon copy of the policy as the one which was in their possession had already been filed in the Court. He had brought a true copy of the policy which was prepared at the time of lodging of claim from the carbon copy of the policy. He proved the true copy as

Ex.R5/W1/1. He confirmed that Mark „A‟, a photocopy of the original policy placed on record of this case by R-2 contain the same vehicles of premium charged by the company as in the original policy.

34. Mark „A‟ is the photocopy of the policy of insurance purported to have been issued in respect of the offending vehicle for the period 24.12.81 to 23.12.82. This document was produced on record by R2, the owner of the offending vehicle who had insured the same with the insurance company, R5. Since, this document has come from the custody of R2, it can always be taken on record and exhibited as as such. I, therefore, take this to be a true copy of the original. As already stated, the carbon copy of the original policy proved on record by RW Mahinder Singh was lost/stolen from the record of this case, secondary evidence was led by R5 and they have produced on record a true copy of R5W/1/1. Mahinder Singh has confirmed that the amount charged and has mentioned in the true copy placed on record by him tallied with the photocopy Mark „A‟ produced on record by R2. Therefore, it is clear that R5W/1/1 is a copy of the original insurance policy issued in this case. The premium charged on account of third party risk was ₹125 only and as per tariff prevalent at that time, the insurance company was liable to pay a maximum compensation of ₹50,000/- on account of third party risk. I therefore hold that R5 M/s New India Assurance Company is liable to pay a sum of ₹50,000/- only plus proportional interest. The balance amount shall be paid by R1 to R4 being the driver and joint owners of the offending vehicles."

18. The owners have placed reliance on a judgment rendered by a learned Single Judge of this Court in case reported as Neeta Trehan & Ors. V. Gopal Krishan & Ors. 2011 ACJ 2029 in which similar questions had arisen in the context of the provision in Section 95(2)(a) of MV Act, 1939. The accident in that case had occurred on 26.10.1982 and the insurance policy which was subject matter of the controversy was for the period 04.04.1982 to 03.04.1983 wherein insurance company had charged

premium of ₹240/-. The learned Single Judge took into account the tariff rates prevalent at time of the accident, as shown at the hearing and noted that the premium payable on account of liability to the public risk was ₹240 as against the premium of ₹200 towards "Act only" liability in respect of the offending vehicle involved in the case. On the basis of the evidence presented in that matter the learned Single Judge concluded that:

"the 'Public Risk' premium would cover unlimited amount of risk and would not cover a limited amount of risk."

19. The learned counsel for the owner, as indeed the claimants, argued that since the document (Ex.R5W1/1) in the instant case reflects basic premium of ₹125 to have been charged, the liability of the insurance company in this case also would be unlimited.

20. The insurance company refers to decision of a constitution bench of the Supreme Court in New India Assurance Company Ltd. V. C M Jaya & Ors. I (2002) SLT 290 and of a division bench of this Court in Veena Pruthi & Ors. V. Oriental Fire and General Insurance Co. Ltd. IV (2011) ACC 42 (DB). In C.M. Jaya (supra) the issue concerned the limited liability on the part of the insurance company in terms of Section 95(2) of MV Act, 1939 in cases where insurance policy had been taken out without higher premium being charged. In absence of proof to such effect, the claim of the insurance company to its liability being limited was upheld. In Veena Pruthi (supra) the accident had occurred on 07.04.1975. The vehicle was insured against a policy on which basic premium of ₹125 had been paid. The insurance company pleaded that its liability was limited to ₹50,000/- in terms of Section 95(2) of the MV

Act. This contention was upheld, the said premium having been found as "basic premium".

21. In the case at hand, the owners have clearly avoided producing the original insurance policy during the inquiry before the Tribunal. In spite of notice under Order 12 Rule 8 CPC served by the insurance company there was no response. The claim that the original insurance policy had been returned to the insurance company after the accident is unpalatable, inasmuch, as after the accident, the said document would be required by the insured to seek to be indemnified by the insurer. Against this backdrop, the insurance company was left with no option but to produce the available (secondary) evidence in the form of carbon copy of the document retained in its office. The carbon copy of the insurance policy (Ex.R5W1/2) having been prepared by the same mechanical process as the original, deserved acceptance as good evidence. The owner did not prove by any evidence that they had paid any higher premium to claim unlimited cover of insurance.

22. In the facts and circumstances, the learned Tribunal is found to have appreciated the evidence correctly to return the finding that the liability of the insurance company was limited to ₹50,000/- only in terms of Section 95(2)(a) of MV Act, 1939. Thus, the appeal of the owner FAO 451/98 is unmerited and liable to be dismissed.

23. The appeals stand disposed of with above observations/directions.

R.K. GAUBA (JUDGE) JANUARY 25, 2016/VLD