Karnataka High Court
H.V.Umesh @ Umesh Reddy vs M/S. I C I C I Lambard General Insurance ... on 13 November, 2024
-1-
NC: 2024:KHC:46132
MFA No. 3803 of 2015
C/W MFA No. 2860 of 2015
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 13TH DAY OF NOVEMBER, 2024
BEFORE
THE HON'BLE MR JUSTICE T.G. SHIVASHANKARE GOWDA
MISCELLANEOUS FIRST APPEAL NO. 3803 OF 2015 (MV-I)
C/W
MISCELLANEOUS FIRST APPEAL NO. 2860 OF 2015 (MV-I)
IN MFA NO.3803/2015
BETWEEN:
MR. SWAMINATHAN S.P.
S/O. POONUSWAMY
AGED ABOUT 50 YEARS,
PROP. SPS TRAVELS, SHOP NO.6,
NO.24, ANANTHA ARACE,
A.V.ROAD, KALASIPALYAM,
BANGALORE-2
... APPELLANT
(BY SRI. NAGARAJA K., ADVOCATE)
AND:
1. THE MANAGER,
ICICI LOMBARD GENERAL INSURANCE CO. LTD.,
Digitally signed by
CHANDRASHEKAR
LAXMAN
ICICI COMPLEX,
KATTIMANI
Location: HIGH NEXT TO CENTRAL SHOPPING COMPLEX,
COURT OF
KARNATAKA MAGRATH ROAD,
BANGALORE-1
(INSURER OF SPS PRIVATE BUS NO. KA-01-AE-8880)
2. SRI. H.V. UMESH @ UMESH REDDY
S/O. VASANTHAPPA,
AGED ABOUT 31 YEARS,
R/AT. NO.630/680, SUNKADAKATTE,
PIPELINE ROAD, MAGADI MAIN ROAD,
VISHWANEEDAM POST,
BANGALORE-560 091.
... RESPONDENTS
(BY SRI. O. MANJUNATH, ADVOCATE FOR R1;
SRI. K.V. SHYAMAPRASAD, ADVOCATE FOR R2 )
-2-
NC: 2024:KHC:46132
MFA No. 3803 of 2015
C/W MFA No. 2860 of 2015
IN MFA NO.2860/2015
BETWEEN:
H.V. UMESH @ UMESH REDDY
S/O. VASANTHAPPA,
AGED ABOUT 31 YEARS,
R/AT. NO.630/680, SUNKADAAKATTE,
PIPELINE ROAD, MAGADI MAIN ROAD,
VISHWANEEDAM POST,
BANGALORE-560 091.
... APPELLANT
(BY SRI. K.V. SHYAMAPRASAD, ADVOCATE)
AND:
1. M/S. ICICI LOMBARD GENERAL
INSURANCE CO. LTD.,
ICICI COMPLEX,
NEXT TO CENTRAL SHOPPING COMPLEX,
MAGRATH ROAD,
BENGALURU-560 001
REPRESENTED BY ITS MANAGER.
2. S.P. SWAMINATHAN
S/O. POONUSWAMY
MAJOR,
PROP. S P S TRAVELS, SHOP NO.6,
NO.24 ANANTHA ARACED,
A.V. ROAD, KALASIPALYAM,
BENGALURU - 560 002
... RESPONDENTS
(BY SRI. R. LOKESH, ADVOCATE FOR R2;
SRI. B.C. SHIVANNE GOWDA, ADVOCATE FOR R1)
THESE APPEALS ARE FILED UNDER SECTION 173(1) OF MV
ACT AGAINST THE JUDGMENT AND AWARD DATED 15.12.2014
PASSED IN MVC NO.4171/2012 BY THE MOTOR ACCIDENT CLAIMS
TRIBUNAL, XX ADDITIONAL SMALL CAUSES JUDGE, BANGALORE
(SCCH-22) AND ASSESS THE LIABILITY AGAINST THE INSURER OF
THE BUS I.E. 1ST RESPONDENT HEREIN AND ETC.,
THESE APPEALS HAVING BEEN HEARD AND RESERVED FOR
JUDGMENT ON 19.08.2024 AND COMING ON FOR 'PRONOUNCEMENT
OF JUDGMENT', THIS DAY, THIS COURT PRONOUNCED THE
FOLLOWING:
-3-
NC: 2024:KHC:46132
MFA No. 3803 of 2015
C/W MFA No. 2860 of 2015
CORAM: HON'BLE MR JUSTICE T.G. SHIVASHANKARE GOWDA
CAV JUDGMENT
(PER: HON'BLE MR JUSTICE T.G. SHIVASHANKARE GOWDA)
In these appeals, the petitioner as well as the owner
of the vehicle have challenged the judgment and award
dated 15.12.2014 passed in MVC.No.4171/2012 by the
Member, MACT and XX Addl. Small Causes Judge,
Bangalore (SCCH-22) (for short, 'Tribunal').
2. The rank of the parties shall be referred to as
per their status before the Tribunal.
3. Brief facts of the case are, on 11.06.2012 at
about 10.00 p.m., near A.V. Road, in front of National
Travels, Kalasipalya, while the petitioner was boarding the
SPS Private Bus bearing No.KA-01/AE-8880, it was moved
suddenly without any signal, due to which he lost control,
fell down and sustained injuries. After taking treatment,
he has approached the Tribunal for grant of compensation
of Rs.12,00,000/-. The claim was opposed by the
NC: 2024:KHC:46132
Insurance Company. The Tribunal, after taking the
evidence and hearing both the parties, by the impugned
judgment allowed the claim petition granting
compensation of Rs.7,50,000/- with interest at 8% p.a.,
and directed the owner of the bus to pay the
compensation and dismissed the claim against the
Insurance Company on the ground that bus in question
was not holding permit to ply within the limits of
Bengaluru City. Pleading inadequacy and seeking
enhancement, the petitioner has filed MFA.No.2860/2015,
whereas questioning quantum of compensation as well as
dismissal of the claim petition against the Insurance
Company, the owner of the vehicle has filed
MFA.No.3803/2015.
4. Heard the arguments of Sri K.V. Shyamaprasad,
learned counsel for the petitioner, Sri K.Nagaraja, learned
counsel for the owner of the bus and Sri O.Manjunath,
learned counsel for the Insurance Company.
NC: 2024:KHC:46132
5. It is the contention of the learned counsel for
the petitioner that, the bus in question was holding a valid
permit upto 18.02.2017 whereas the accident took place
on 11.06.2012, there is a valid permit. RW2-N.Rajanna,
the RTO official has been examined to explain that the bus
in question was having a permit at the time of accident.
The Tribunal has erroneously held that there was no
permit and dismissed the claim against the Insurance
Company.
5.1. It is further contended that, the compensation
assessed by the Tribunal is on the lower side. In spite of
the medical evidence by the Doctor that the petitioner has
suffered functional disability of 45%, the same was not
considered. Compensation awarded under different heads
is on the lower side and the Tribunal has considered the
income at Rs.6,000/- is on the lower side and he sought
for enhancement.
6. Learned counsel for the owner of the bus has
contended that, the bus in question was holding a valid
NC: 2024:KHC:46132
permit, which has been confirmed by RW.2, the official of
RTO that the bus was holding effective permit. It is not
proper on the part of the Tribunal to fasten the liability
against the owner. That apart, it also argued that under
Section 149(2) of the M.V.Act, issue regarding permit is
not available as defense to the Insurance Company. When
such defense is not available, the Insurance Company is
bound to indemnify the liability on the part of the owner of
the vehicle. The compensation awarded and rate of
interest awarded by the Tribunal at 8% is on the higher
side and no banks will offer such rate of interest at the
relevant point of time and he sought for direction to the
Insurance Company to pay the compensation.
7. Per contra, learned counsel for the Insurance
Company has contended that, the permit issued to the bus
in question was valid upto 18.02.2017, but the condition
stipulated in the permit contemplates that the owner of
the vehicle has to replace the bus with a new vehicle
within 8 years from the date of its registration. But the
NC: 2024:KHC:46132
vehicle involved in the accident was old one wherein the
permit expires on 01.04.2012 as the condition stipulated
at the time of grant of permit on 19.02.2017 was for a
period of 8 years from the date of initial registration and 8
years expires on 01.04.2012. The owner of the vehicle is
required to replace the bus with new model in order to
continue the permit, otherwise it will be lapsed. This has
been explained through RW.2, N.Rajanna, the RTO official
and the Tribunal has rightly considered this aspect that on
the date of accident there was no permit. Since the old
bus was plied even after 8 years of its registration, there is
a deemed lapse of permit and therefore there is a
fundamental breach of terms and conditions of the policy
as contemplated under Section 149(2) of the M.V.Act, the
Insurance Company can avoid its liability and he has
supported the impugned judgment.
8. I gave my anxious consideration to the
arguments addressed by the learned counsel for both the
parties and perused the records.
NC: 2024:KHC:46132
9. There is no dispute as to the accident, cause of
the accident and injuries sustained by the petitioner. The
owner of the vehicle is questioning quantum of
compensation as well as dismissal of the claim petition on
the ground of 'no permit'. The Insurance Company argues
in support of the impugned judgment. The petitioner
claims that the compensation awarded is on the lower
side, the bus in question was holding valid permit and the
Insurance Company has to indemnify the insured.
10. On careful perusal of the materials on record, it
is pertinent to note that in the accident, the petitioner has
suffered segmental fracture of proximal 1/3rd of right
femur; fracture mid 1/3rd right fibula; fracture of medial
malleolus right ankle; degloving injuries to right leg and
left thigh; compression fracture of C6 and C7. He was
under hospitalization for a period of 4 months. PW.2-
Dr.N.S.Mohan is examined to explain the disability
sustained by the petitioner to the extent of 45% to the
whole body. Having regard to the fractures, the period of
NC: 2024:KHC:46132
treatment and avocation of the petitioner as a driver, the
functional disability assessed at 30% by the Tribunal is
proper. The petitioner will be laid up for minimum of 10
months as the hospitalization period itself was 4 months.
Though the petitioner claims that he was earning
Rs.8,000/- per month, he has not placed any evidence in
proof of his income. Having regard to his avocation as a
driver, even if it is treated that a person with no proof of
income in the year 2012, will earn not less than Rs.7,000/-
per month. Hence, the notional income of the petitioner is
taken at Rs.7,000/- per month. Medical bills constitute a
sum of Rs.1,07,000/-, which is required to be reimbursed
and the money spent towards attendant, food and
nourishment and conveyance has to be compensated so
also loss of amenities and discomfort, loss of future
income and also money required for further treatment.
11. As regarding quantum of compensation, having
regard to the nature of injuries, petitioner has to be
compensated with just compensation. Hence, a sum of
- 10 -
NC: 2024:KHC:46132
Rs.1,50,000/- towards pain and suffering, Rs.1,07,000/-
towards medical expenses and future medical expenses at
Rs.30,000/- assessed by the Tribunal are kept in tact.
Having regard to the income of the petitioner at
Rs.7,000/-, loss of income during 10 months of laid up
comes to Rs.70,000/-. Incidental expenses such as
attendant, food and nourishment and conveyance, in all
comes to Rs.55,000/-. Loss of amenities and discomfort
has to be awarded at Rs.1,00,000/-. As regarding future
loss of income is concerned, as discussed above, the
income is taken at Rs.7,000/- per month, the petitioner is
aged 28 years and for the said age, applicable multiplier is
17, whole body disability is 30% and future prospects of
40% has to be considered. Then the future loss of income
will be Rs.7,000/- + Rs.2,800/-(40%) = Rs.9,800/- x 12 x
17 x 30% = Rs.5,99,760/-. Thus, in all, the petitioner is
entitled to total compensation of Rs.11,11,760/- as
against Rs.7,50,000/-, thereby enhancement of
Rs.3,61,760/-. It is the just compensation that the
- 11 -
NC: 2024:KHC:46132
petitioner is entitled to, under the facts and circumstances
of the case.
12. As rightly contended by the learned counsel for
the Insurance Company that the Tribunal awarded higher
rate of interest at 8% p.a. In the year 2012, no banks will
offer such rate of interest. Unless the Tribunal gives a
proper reason, interest at 8% p.a. cannot be awarded.
13. In this regard, the Division Bench of this Court in
Ms. Joyeeta Bose and Ors. -vs- Venkateshan V. and
Ors. in MFA.No.5896/2018 c/w MFA.Nos.4444/2018 and
4659/2018 (MV) DD 24.08.2020 with reference to Section
149(1) of Motor Vehicles Act, 1988, Rule 253 of Karnataka
Motor Vehicles Rules, 1989 and Section 34 of Civil
Procedure Code, at para 52 held as under:
"52. Thus, under Section 34 of CPC being squarely
applicable to the interest awarded by the Tribunal and
Section 34 empowering the Tribunal to award pendent lite
interest and discretion being vested with the
Court/Tribunal to award interest from the date of suit or
petition is to be maximum extent of 6% p.a. or in other
words, not exceeding 6% p.a., the contention raised by
- 12 -
NC: 2024:KHC:46132
the learned Advocates appearing for the Insurance
Company deserves to be accepted and according, it is
accepted. ....."
In the light of the above, since the Tribunal has not
assigned any special reason for awarding higher rate of
interest, the petitioner is entitled for interest at 6% p.a.
instead of 8% p.a.
14. As regarding liability is concerned, there is no
dispute that the bus in question is a tourist bus, it was
issued with the permit with an area to ply through out
India and the permit has been renewed upto 18.02.2017.
The vehicle was registered on 02.04.2004. The contention
of the Insurance Company that the permit is valid upto
18.02.2017 provided the owner of the bus has replaced
the old bus with a new bus within 8 years of its
registration. As the registration of the vehicle was on
02.04.2004, within 8 years therefrom bus has to be
replaced with a newer one in order to continue the permit.
In this regard, it is relevant to refer the evidence of RW.2-
N.Rajanna, the RTO official, that in order to maintain the
- 13 -
NC: 2024:KHC:46132
extension of the permit the owner is required to replace
the bus on or before 01.04.2012. Wherein the bus in
question was the old bus which was not replaced with a
new model, thereby the permit renewed upto 18.02.2017
came to be lapsed with effect from 01.04.2012 wherein
the accident took place on 11.06.2012. On that day, there
is no permit to the said vehicle and it has been operated
without valid permit, such a vehicle cannot run in the
public road without valid permit. Hence, the evidence let in
on behalf of the Insurance Company clearly point out that
the bus in question was plied on the road without valid
permit on the date of accident. Hence, there is a violation
of terms and conditions of the policy.
15. Learned counsel for the petitioner has relied upon
the judgment of the Division Bench of this Court in United
India Insurance Co. Ltd. -vs- Smt. Yasmin Begum @
Yasmin and others1, held that there is no defence
available to the Insurance Company and there is no
fundamental breach of terms and conditions of the policy
MFA.No.5159/2016 DD 19.07.2019
- 14 -
NC: 2024:KHC:46132
and the owner and insurer are jointly liable to satisfy the
award.
16. Learned counsel for the Insurance Company has
relied on the judgment of the Hon'ble Apex Court, in
Gohar Mohammed -vs- U.P. State Road Transport
Corporation and Others2, wherein it is held that when
the bus did not have the valid permit, fastening of liability
against the owner of the vehicle is proper as the Insurance
Company can avoid its liability as plying the vehicle
without valid permit is a fundamental breach. The Division
Bench of this Court in Syed Zaheer @ Sayyued
Jahiruddin Bokhari -vs- Smt. Puttamadamma3, held
that if a bus is operated under a permit, it does not
amount to the breach of policy, if the bus is operated
without permit, the defence is available to the Insurance
Company under Section 149(2)(a) and (b) of the M.V.Act.
In view of the same, the owner of the vehicle cannot
operate the bus in a public place except in terms of the
2022 ACJ 2771
MFA.No.5745/2016 cw. MFA.No.4811/2016
- 15 -
NC: 2024:KHC:46132
permit. Hence, it has held that owner of the bus is liable to
pay compensation, but it has applied the principle of pay
and recovery in the light of the judgments of the Hon'ble
Apex Court in Pappu and Ors. -vs- Vinod Kumar
Lamba and Anr.4, National Insurance Co. Ltd. -vs-
Swaran Singh and Others5 and Rani and Others -vs-
National Insurance Co. Ltd and Others6.
17. In view of the law laid down by the Hon'ble Apex
Court in Gohar Mohammed's case (supra) and also latest
judgment of Division Bench of this Court in Syed Zaheer's
case (supra), the owner of the bus is required to replace
the bus within 8 years from 01.04.2004. Since the bus
was not replaced with new model, the permit stands
automatically cancelled on 11.06.2012, the bus was plied
without valid permit. There is a fundamental breach, the
Insurance Company can avoid its liability. Hence, the
Tribunal is right in holding that the Insurance Company
can avoid its liability and fastened the liability against the
AIR 2018 SC 592
(2004) 3 SCC 297
(2018) 8 SCC 492
- 16 -
NC: 2024:KHC:46132
owner. But the principle of 'pay and recovery' has to be
applied to the facts and circumstances of the case.
18. In view of the above discussion, the petitioner is
entitled for enhanced compensation of Rs.3,61,760/-, rate
of interest has to be modified at 6% p.a. and principle of
pay and recovery has to be applied. Accordingly, both the
appeals merit consideration, in the result, the following:
ORDER
i. Both the appeals are allowed in part;
ii. The impugned judgment and award passed by
the Tribunal is modified;
iii. The petitioner would be entitled to enhanced
compensation of Rs.3,61,760/- with interest at
6% p.a. from the date of petition till the date of
deposit excluding interest on future medical
expenses of Rs.30,000/-;
iv. The owner of the vehicle is held liable to pay
the compensation;
v. The Insurance Company is directed to deposit
the compensation including enhanced
- 17 -
NC: 2024:KHC:46132
compensation along with interest within 8
weeks from the date of receipt of certified copy
of this judgment with liberty to recover the
same from the owner of the bus in the same
proceedings;
vi. Amount in deposit shall be transmitted to the
Tribunal along with records forthwith.
Sd/-
(T.G. SHIVASHANKARE GOWDA)
JUDGE
MKM/-
Ct-cmu
