Delhi High Court
National Insurance Co. Ltd. vs Sonia Mittal & Ors. on 12 October, 2017
$~9 to 11
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Decided on: 12th October, 2017
+ MAC APPEAL No. 1043/2016
NATIONAL INSURANCE CO. LTD. ..... Appellant
Through: Mr. Abhishek Mishra, Adv.
versus
SONIA MITTAL & ORS. ..... Respondents
Through: Mr. Nitin Yadav, Adv. for R1
to 3.
Mr. Pramod Pandey, Adv. for
R-4 & 5.
+ MAC APPEAL No. 1044/2016
NATIONAL INSURANCE CO. LTD. ..... Appellant
Through: Mr. Abhishek Mishra, Adv.
versus
LRS OF SHANKAR MITTAL & ORS. .....
Respondent
Through: Mr. Nitin Yadav, Adv. for R1
to 3.
Mr. Pramod Pandey, Adv. for
R-4 & 5.
+ MAC APPEAL No. 1048/2016
NATIONAL INSURANCE CO. LTD. ..... Appellant
Through: Mr. Abhishek Mishra, Adv.
versus
AMOGH MITTAL & ORS. ..... Respondents
Through: Mr. Nitin Yadav, Adv. for R1
to 3.
MAC Appeal No. 1043/2016 & conn. Page 1 of 8
Mr. Pramod Pandey, Adv. for
R-4 & 5.
CORAM:
HON'BLE MR. JUSTICE R.K.GAUBA
JUDGMENT (ORAL)
1. On 17.02.2012, Shankar Mittal with his wife Sonia Mittal and
minor son Amogh Mittal were going in a car bearing registration no.
HR 72 0051 driven by the former. The car came to be involved in a
motor vehicular accident in the area of police station Kapashera, New
Delhi, it being on account of collision against motor vehicle described
as Tanker bearing registration no. UP 53BT 7086. All the three
persons in the car suffered injuries, Shankar Mittal dying in the
consequence. Three accident claim cases came to be instituted, one
(MACP 478/2014) seeking compensation on account of death of
Shankar Mittal and the others (MACP No. 475 and 552/2014) on
account of injuries suffered by Amogh Mittal and Sonia Mittal
respectively. The cases resulted in inquiry and a common judgment
dated 30.08.2016 whereby the Motor Accident Claims Tribunal held
that the accident had occurred due to negligent driving of the tanker by
Mithlesh Kumar Upadhyaya (respondent in these appeals) hereinafter
referred to as "the driver of the offending vehicle". The tanker was
admittedly registered in the name of India tankers Pvt. Ltd. (another
respondent in these appeals) hereinafter referred to as "the registered
owner of the offending vehicle", the appellant (insurer) admittedly
being the insurance company which had issued an insurance policy
covering third party risk in respect of the tanker for the period in
question.
2. During the course of inquiry, the insurer had raised the plea that
the tanker was meant for carrying hazardous goods and, therefore, the
driving licence of its driver should have necessary endorsement in
terms of requirement of Section 14 (2) (a) of the Motor Vehicles Act,
1988 read with Rules 9 (d) and 132 of Central Motor Rules, 1989.
The parties led evidence in the course of which it was proved that the
driver of the offending vehicle was holding a valid and effective
driving licence for heavy goods vehicle/heavy transport vehicle for the
period in question and that he also possessed the training certificate
(Ex.R2W1/5) for safe transportation of hazardous goods, it being valid
for the period 13.01.2012 to 12.01.2013. The tribunal rejected the
contention of the insurance company about the breach of terms and
conditions of the insurance policy which was essentially based on the
fact that there was no formal endorsement about such training or
competence, in terms of the statutory requirements, on the driving
licence of the driver of the offending vehicle.
3. In the case of claim arising out of death of Shankar Mittal, the
tribunal awarded total compensation in the sum of Rs. 1,06,51,800/-,
the said amount inclusive of Rs. 1,02,76,800/- calculated towards loss
of dependency on the basis of conclusion reached that the deceased
was earning Rs. 6,42,300/- per annum from his business in the name
of Shankar Motors, reference in this context being made to the
income-tax returns (ITRs) for the assessment years 2011-2012 and
2012-13, last of such ITRs reflecting such level of increase.
4. By the appeals at hand, the insurance company submits that the
conclusion of the tribunal denying to it exoneration or recovery rights
on the basis of breach of terms and conditions of the insurance policy
is erroneous as the requirement of formal endorsement is requisite and
could not have been given a go by. Reliance is placed on decision of
this Court dated 18.01.2016 in MAC Appeal No. 798/2010 New India
Assurance Co. Ltd. vs. Ashpal & Ors. and of learned Single Judge of
the High Court of Allahbad (Lucknow Bench) dated 05.10.2016 in
FAFO Nos. 20-21/2016 Krishna Kumar & Ors. vs. United Insurance
Company Ltd. & Ors. In the case of award on account of death of
Shankar Mittal, the calculation of loss of dependency on the basis of
the last two ITRs for the assessment years 2011-12 and 2012-13 is
also questioned, it being pointed out that these ITRs were filed post
death of the person in question and that the tribunal has ignored the
ITRs for the two immediately preceding years being for AY 2009-10
and 2010-11 respectively which would show the income from the
business at a much lower level.
5. Having heard the learned counsel on both sides, this Court finds
substance in the exception taken to the method of calculation of loss of
dependency in the claim case on account of death of Shankar Mittal.
The judgment of the tribunal, in fact, does not even refer to the fact
that the claimants had also submitted in evidence, ITRs for 2009-10
and 2010-11 (Ex.PW-5/1 collectively), the only discussion by the
tribunal on the subject being as under:-
"16. In Case bearing No. 478/14 titled as Sonia Mittal
& Anrs. Vs. Mithlesh Kumar Upadhaya & Anrs., Ms.
Sonia Mittal has come in the witness box and stated that
her husband Shanker Mittal was businessman and doing
business in the name and style of M/s Shanker Motors
and was earning more than Rs. 6,42,300/- per annum
(Rs. Six lacs forty two thousand three hundred only) per
month. PW-6 Ashok Kumar from Income Tax proved the
ITR of the deceased for the year 2011-12 and 2012-13
wherein yearly income is mentioned as Rs. 6,42,300/-
(Six Lacs forty two thousand three hundred only). There
is no reason to doubt that the annual income of deceased
which is supported by ITR of many years. Therefore, his
annual income is taken as Rs. 6,42,300/- (Six lacs forty
two thousand three hundred only).
6. The above approach was not correct. The tribunal did not even
take note of the fact that the ITRs for 2011-12 and 2012-13 were filed
after the death as was the import of the evidence brought out through
documents (Ex.PW-6/1 collectively). It may be mentioned here that
as per the ITR for AY 2009-10, corresponding to functional year
2008-2009 the total income reported by the deceased, was Rs.
1,97,671 and for the immediate next year i.e. A.Y. 2010-2011 which
would correspond to financial year 2009-10, the income reported by
the deceased was Rs. 2,58,712/-. Strangely in the ITRs for the two
subsequent assessment years, submitted in his name, the claim was
that he had earned Rs. 5,88,727/- and Rs. 6,42,300/- respectively.
There is no co-relation between the income for the first two said
financial years/assessment years with the income for the subsequent
two years.
7. Against the above backdrop the counsel for the claimants now
fairly concedes that the income declared in the subsequent two ITRs
may be ignored since the same were submitted post the death and
there is no other material available for the generation of such income
to be substantiated or corroborated. He, however, submitted that the
income declared for AY 2010-11 i.e. Rs. 2,58,712/- may be taken as
the benchmark and that the element of future prospects may be
factored in inasmuch as the ITR immediately preceding shows
progressive rise in income. The counsel representing the insurance
company also fairly agrees to such basis for calculation.
8. In the face of irrefutable evidence of progressive rise in income
from AY 2009-10 to 2010-11, the element of future prospects to the
extent of 50 % would have to be factored in [see judgment dated
28.03.2016 in MAC.APP. 548/2013 United India Insurance Co. Ltd.
v. Kamla & Ors.]. The calculation of loss of dependency thus, is
made, on the basis of income declared for AY 2010-2011 i.e. Rs.
2,58,712/-.
9. Shankar Mittal, the deceased was 34 years old when he died.
Therefore, the multiplier of 16 was adopted by the tribunal. There are
three members of the family who were dependents on him and,
therefore, deduction on account of personal and living expenses to the
extent of 1/3rd is to be made. The loss of dependency, thus, is
recomputed as (258712 x 150 ÷ 100 x 2 ÷3 x 16) Rs. 41,39, 392/-,
rounded off to Rs. 41,40,000/-.
10. It is noted that the dispensation under the non-pecuniary heads
of damages granted by the tribunal is not in sync with similarly placed
cases of same vintage as per ruling in Shriram General Insurance Co
Ltd v. Usha, MAC.APP.No.160/2015, decided on 05.05.2016.
Therefore the said awards are also suitably modified. It is directed
that the claimants will be entitled to Rs. 1,50,000/- each towards loss
of love & affection and towards loss of consortium and Rs. 50,000/-
each towards loss of estate and funeral expenses. This would result in
total compensation in the sum of (41,40,000 + 1,50,000 + 1,50,000 +
50,000 + 50,000) Rs. 45,40,000/- (forty five lacs forty thousand only).
The award is modified accordingly. The insurance company has also
taken exception to the levy of interest to the awards in the three cases.
Indeed, there is no special reason set out for levy of higher rate of
interest. Following the consistent view taken by this Court, the rate of
interest is modified to 9% (nine per cent) per annum from the date of
filing of the petition till realization. [see judgment dated 22.02.2016
in MAC.APP. 165/2011 Oriental Insurance Co Ltd v. Sangeeta Devi
& Ors.]. The awards in the three cases are modified accordingly.
11. Coming to the defence taken by the insurance company vis-à-
vis the driver and owner of the offending vehicle, what distinguishes
the case at hand is that the driver of the offending vehicle had
undergone the requisite training which had been duly certified. There
is nothing on record to show that the insurance company raises
questions about the validity of the training certificate. It is insisting
merely on the fact that there was no endorsement secured from the
transport authority in terms of the requirement under the rules. That,
however, ought not cut any ice. What is the crucial requirement is the
special training for driving a vehicle meant for transportation of
hazardous goods. That requirement had been fulfilled. Securing of
endorsement in wake of such certification of the special skill was
more of ministerial nature. The rule of main purpose would apply [see
National Insurance Company V. Swaran Singh (2004) 3 SCC 297].
The plea of insurers for recovery rights is, therefore, rejected.
12. By similar orders passed on 07.12.2016, in each of these
appeals, the insurance company had been directed to deposit 50% of
the awarded amount (without interest) with the tribunal as a pre-
condition to the stay against execution. The amount thus deposited
was permitted to be released to the respective claimants in the injury
cases and one-third of such deposit was released in the death case by
separate orders passed on 20.03.2017. By subsequent orders passed
on 02.05.2017 in each of these appeals, the insurance company was
also directed to deposit the interest component on the already
deposited 50% of the awarded amount as well. The tribunal shall now
calculate the amounts payable to the respective claimants in the
appeals and release the balance from out of the deposit made,
refunding the excess, if any, to the insurance company. Conversely, if
any, amount is found to be deficient it shall be deposited with
corresponding upto date interest with the tribunal within thirty days
for it to be released to the claimants in terms of the awards modified as
above.
13. The appeals are disposed of in above terms.
R.K.GAUBA, J.
OCTOBER 12, 2017/nk
