Karnataka High Court
The Divisional Manager vs Smt. Indravva W/O Satyappa Alligidad on 23 January, 2025
Author: B.M.Shyam Prasad
Bench: B.M.Shyam Prasad
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MFA No. 102800 of 2022
C/W MFA No. 101140 of 2022
IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH
DATED THIS THE 23RD DAY OF JANUARY, 2025
PRESENT
THE HON'BLE MR. JUSTICE B.M.SHYAM PRASAD
AND
THE HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR
MISCELLANEOUS FIRST APPEAL NO.102800 OF 2022 (MV-D)
C/W
MISCELLANEOUS FIRST APPEAL NO. 101140 OF 2022
IN MFA NO.102800/2022
BETWEEN:
1. SMT. INDRAVVA
AGE. 52 YEARS OCC. HOUSEHOLD
2. KALPANA D/O. SATYAPPA ALLIGIDAD
AGE. 32 YEARS OCC. COOLIE,
BOTH ARE R/O. KALLATTI GALLI
TAL.RABAKAVI BANAHATTI,
DIST.BAGALKOT 587315.
Digitally signed ...APPELLANTS
by
SHAKAMBARI
Location: High (BY SRI. HARISH S. MAIGUR, ADVOCATE)
Court of
Karnataka,
Dharwad Bench AND:
1. SHRISHAIL S/O. SIDDAPPA PALABHAVI
AGE:. MAJOR OCC: BUSINESS,
R/O: HALINGALI,
TAL. RABAKAVI BANAHATTI,
DIST. BAGALKOT 587311.
2. THE DIVISIONAL MANAGER
SHRIRAM GENERAL INSURANCE
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MFA No. 102800 of 2022
C/W MFA No. 101140 of 2022
COMPANY LIMITED,
CTS NO. 477/M, 1ST FLOOR,
V.A. KALABURGI HALLMARK,
DESAI CROSS, PINTO ROAD,
HUBBALLI-DHARWAD 580020.
...RESPONDENTS
(BY SRI. VITAL S. TELI, ADVOCATE FOR R1;
SRI. NAGARAJ S. KOLLORI, ADVOCATE FOR R2)
THIS MFA IS FILED UNDER SECTION 173 (1) OF MOTOR
VEHICLES ACT, AGAINST THE JUDGMENT AND AWARD DATED
30.11.2021 PASSED IN MVC NO.219/2020 ON THE FILE OF
THE SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST
CLASS, XIII MOTOR ACCIDENT CLAIMS TRIBUNAL,
BANAHATTI, PARTLY ALLOWING THE CLAIM PETITION FOR
COMPENSATION AND SEEKING ENHANCEMENT OF
COMPENSATION.SRI. HARISH S. MAIGUR, ADVOCATE FOR
APPELLANT.
IN MFA NO.101140/2022
BETWEEN:
THE DIVISIONAL MANAGER
SHRIRAM GENERAL INSURANCE COM LTD.,
CTS NO. 477/1M, IST FLOOR,
V.A. KALABURGI, HALLMARK,
DESAI CROSS, PINTO ROAD, HUBBALLI
REPRESENTED BY ITS AUTHORISED
SIGNATORY.
...APPELLANT
(BY SRI. NAGARAJ C. KOLLOORI, ADVOCATE)
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MFA No. 102800 of 2022
C/W MFA No. 101140 of 2022
AND:
1. SMT. INDRAVVA W/O. SATYAPPA ALLIGIDAD
AGE: 52 YEARS, OCC: HOUSEHOLD WORK,
R/O: KALLATTI GALLI, TERDAL,
TQ: RABKAVI -BANAHATTI,
DIST: BAGALKOT-587314.
2. KALPANA D/O. SATYAPPA ALLIGIDAD
AGE: 32 YEARS, OCC: COOLIE,
R/O: KALLATTI GALLI, TERDAL,
TQ: RABKAVI -BANAHATTI,
DIST: BAGALKOT-587314.
3. SHRISHAIL S/O. SIDDAPPA PALABHAVI
AGE: MAJOR, OCC: BUSINESS,
R/O: HALINGALI,
TQ RABAKAVI-BANAHATTI
DIST BAGALKOT-587314.
...RESPONDENTS
(BY SRI. HARISH S. MAIGUR, ADVOCATE FOR R1 AND R2;
SRI. NAGARAJ S. KALLOORI, ADVOCATE FOR R3)
THIS MFA IS FILED U/S.173(1) OF MOTOR VEHICLES
ACT, AGAINST THE JUDGMENT AND AWARD DATED
30.11.2021 PASSED IN MVC NO.219/2020 ON THE FILE OF
THE SENIOR CIVIL JUDGE AND JUDICIAL MAGISTRATE FIRST
CLASS, XIII MOTOR ACCIDENT CLAIMS TRIBUNAL,
BANAHATTI.
THESE APPEALS, COMING ON FOR ADMISSION, THIS
DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: THE HON'BLE MR. JUSTICE B.M.SHYAM PRASAD
AND
THE HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR
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MFA No. 102800 of 2022
C/W MFA No. 101140 of 2022
ORAL JUDGMENT
(PER: THE HON'BLE MR. JUSTICE RAMACHANDRA D. HUDDAR)
These two appeals are directed against a single
judgment and award dated 30th November 2021 passed in
MVC No.219/2020 by the Senior Civil Judge and JMFC XIII
MACT, Banahatti (`Tribunal' for short). MFA No.101140/22
is presented by respondent No.2 the Insurer challenging the
liability and quantum of compensation and MFA
No.102800/22 is filed by the claimants seeking
enhancement of compensation.
2. Parties to these appeals are referred to as per
their rank before the Tribunal.
3. Brief and relevant facts as stated by the
Claimants before the Tribunal in their claim petition under
Section 166 of the Motor Vehicle Act, 1988 are as under:
The claimants filed a claim petition under Section 166
of MV Act, 1988 seeking compensation on account of death
of Satyappa S/o.Ramappa Alligidad who died in a road
traffic accident at 8.15 p.m on 25.2.2020. According to the
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claimants, deceased Satyappa was travelling in an auto
rickshaw bearing Regn KA-48-A-0163 from Terdal Circle
towards Harugeri. When the said auto rickshaw came near
first canal of Ajanal Bridge, the driver of the said vehicle
drove the said auto rickshaw in a high speed in a rash and
negligent manner thereby it turtled down. Because of this
accident, the inmates of the vehicle sustained injuries and
Satyappa died on the spot. The deceased was aged 55 years
and was earning Rs.20,000/-per month. Claimant No.1 is
the wife and claimant No.2 is unmarried daughter. Due to
his death, they have lost their earning member as the
claimants were fully depending upon him. Both the
respondents are liable to pay the compensation and prayed
to award a compensation of Rs.50,00,000/-.
4. Both the respondents appeared before the
Tribunal and filed independent written statements denying
the entire assertions made in the petition and specifically
contended that claimants are not entitled for compensation.
Offending vehicle was insured with respondent No.2 and as
on the date of accident, the insurance policy was in force
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and hence, respondent no.2 is liable to pay the
compensation. On the other hand, respondent 2 contends
that, said vehicle was plied by respondent no.1 without valid
permit and it was permitted to ply within the radius of 10
kms. of Rabakavi and Banahatti towns. The Driver of the
said offending vehicle was not possessing the effective
driving licence. Therefore, there is violation of terms and
conditions of the policy and hence, respondent No.2 is not
liable to pay the compensation. By contending so, both the
respondents pray to dismiss the petition.
5. Based upon the rival pleadings of both the
parties, the Tribunal framed in all five issues. To prove the
case of the claimants, claimant no.1 was examined as PW1
and got marked Ex.P1 to 7. Respondent No.1 being owner of
offending auto rickshaw was examined himself as RW.1 and
got marked his original RC card as per Ex.R1. Respondent
no.2-Insurance Company examined its official by name Sri
Nithin Shenoy as RW.2 and got marked Ex.R2 to 10 and
closed respondents' evidence.
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6. On closure of the evidence of both the side, the
learned Tribunal held that, the said accident has taken
place because of the rash and negligent driving of the
offending auto rickshaw by its driver and further held that,
there is no violation of any policy conditions and ultimately
came to the conclusion that, the driver of the offending
vehicle was not holding the effective driving licence. It
further held that deceased was earning Rs.12,000/- as his
monthly income and by applying multiplier `11' ,held that
claimants being the dependents are entitled for
compensation of Rs.11,11,000/- together with interest @6%
p.a. from the date of petition till its realization. It is held that
respondent No.2 the Insurer is liable to pay the said
compensation. Now, the Insurer challenges the judgment
and award questioning the liability and quantum and
claimants seek enhancement of the compensation by
preferring these two independent appeals.
7. The learned counsel for the Insurer Sri Nagaraj
C. Kolloori submits that, quantum and liability fixed by the
Tribunal is against the facts of the case and it is without
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looking into the materials placed on record placed. The
Tribunal has wrongly calculated the monthly income of the
deceased at Rs.12,000/- to reckon the quantum of
compensation towards `Loss of Dependency' which is on
higher side. It is contended that, the driver of the said
vehicle was not possessing the valid and effective driving
licence at the time of accident and the documents so
produced show that, the police have filed charge sheet
against the driver even under Section 3 of the MV Act which
is the violation of the policy conditions and which was a
fundamental breach and against the provisions of the MV
Act. Therefore, the claimants are not entitled for
compensation and fixation of liability on the Insurance
Company is wrong. Hence, it is prayed by the learned
counsel to allow the appeal.
8. As against this submission, the learned counsel
for claimants Sri Harish S.Maigur submits that, the income
so arrived at by the Tribunal is on lower side and it is
against the guidelines issued by the Karnataka State Legal
Services Authority. He would submit that, rightly the
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Tribunal has fastened the liability on the Insurer as
Insurance Policy was in force as on the date of accident.
Respondent No.1's evidence do establishes about validity of
Insurance Policy as on the date of accident and hence, he
seeks enhancement of compensation as prayed.
9. We have considered the submissions of both the
side and perused the records. In view of the rival
submissions of both the side, the point that would arise for
our consideration are:
"1. Whether the insurer is absolved of
payment of any compensation amount in view of
alleged breach of policy conditions?
2. Whether the claimants are entitled for
enhancement in compensation awarded by the
Tribunal?"
Our answers to the above points are partly in the
affirmative for the following reasons:
10. So far as occurrence of accident on 25.2.2020 at
8.15 p.m. is concerned, it is not in dispute. It is also not in
dispute that, in the said vehicle deceased was also an
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inmate. He died in the said accident. It is also not in dispute
that, respondent no.1 is the owner of the said offending
vehicle and his name is shown as owner in the RC Card
Ex.R1 so produced by him. Even it is admitted that, as on
the date of accident, the Insurance Policy was in force and
valid as per contents of R3 produced by R2.
11. Now the question arises as to whether
respondent no.1.has violated any of the policy conditions as
contended by respondent no.2. The respondent no.1 who is
examined as RW1 in his examination-in-chief admits about
the accident and according to him, at the time of accident,
he was not driving the auto rickshaw but, some other
person was driving the rickshaw. He never says in his
examination-in-chief that, the driver of the said auto
rickshaw was not possessing the effective driving licence. He
states that, he is an auto rickshaw driver by profession. He
is possessing driving licence but, he has not produced his
driving licence but, states that, he has lost his driving
licence. About losing of said driving licence, he has not
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taken any steps as per his cross-examination directed to
him by R2.
12. RW.2 by name Sri Nithin Shenoy is consistent
that, respondent no.1 being the driver of the said auto
rickshaw was not possessing the driving licence when he
caused the accident and thereby, the police have charge
sheeted him for the offence of Section 3 read with 181 of
MV. Even the notices were issued to respondent no.1 to
produce the driving licence. The investigation officer of the
insurer on investigation came to know that, respondent no.1
was not possessing the driving licence thereby, violated the
policy conditions. With regard to issuance of notice,
respondent no.2 relies upon R4 copies of legal notice dated
4.8.2021 and postal receipt and acknowledgment at Ex.P5
to P10.
13. RW.2 admits that, a notice was not issued to
ARTO, Jamkhandi but, he is consistent that the driver of
the said offending vehicle was not possessing the driving
licence, filing of charge sheet against respondent no.1 for
not possessing the driving licence at the time of accident
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which is not denied by respondent no.1. The notices were
issued to respondent no.1 so also to ARTO, Jamkhandi,
calling upon them to produce driving licence. There was no
response. Thus, from the evidence of RW.1 and 2, it is
proved by respondent no.2 that, respondent no.1 being the
driver of the offending vehicle was not possessing the
effective and valid driving licence thereby, violated the policy
conditions. It is mandatory on the part of the driver of the
vehicle who drives the vehicle must hold an effective driving
licence at the time of the driving the vehicle. In this case, as
stated supra, it is not proved that driver of the offending
vehicle was possessing effective driving licence and as per
the clause stated in R3, there is violation of policy
conditions.
14. The Insurer relied upon judgment of Hon'ble
Apex Court in Balu Krishna Chavan v/s The reliance
General Insurance co Ltd. And Ors.1 and submits that,
insurer is not liable to deposit the compensation. In this
judgment, it is ordered to the Insurance Company to deposit
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the compensation amount and liberty is reserved to recover
the compensation from the owner of the vehicle.
15. So far as quantum of compensation is concerned,
though the learned counsel for the insurer submits that the
compensation awarded by the Tribunal is on the higher
side, but, the claimants contend that it is on lower side.
While considering the income of the deceased, the learned
Tribunal has taken the monthly income of the deceased at
Rs.12,000/- as there is no evidence placed on record about
the income of the deceased. But, according to KSLSA
guidelines, for the accident of the year 2020, Rs.13,750/- is
to be taken as notional income. Thus, Rs.13,750/- is taken
as monthly income of the deceased. As the deceased was
aged 55 years as per the claimants themselves and have
produced the PM report at Ex.P4 showing his age as 55
years as on the date of accident, as per the judgment in
National Insurance Co.Ltd v/s Pranay Sethi2, 10% of the
income of the deceased is to be added towards future
prospects. Thus, 10% of Rs.13,750 x 10% = Rs.13,750 +
(2017) 16 SCC 680
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Rs.1375 =Rs.15,125/-. Thus, the monthly income of the
deceased comes to Rs.15,125/-. There are two claimants. As
per judgment of Hon'ble Apex Court in Sarla Verma and
Ors. v/s Delhi Transport Corporation and Anr3, 1/3rd is
to be deducted towards personal expenses of the deceased.
It comes to Rs.5041.66. Thus, the total contribution of the
deceased towards his family would be Rs.10,083/- per
month. This should be calculated annually by multiplying
with `12'. The proper multiplier as per Sarla Verma's
(supra) is `11' as the deceased was aged 55 years. Thus, the
`loss of dependency' would be Rs.13,30,956/-. Thus, the
claimants are entitled for compensation towards `loss of
dependency' at Rs.13,30,956/-.
16. So far as compensation towards `loss of
consortium' is concerned, the claimant no.1 being the wife
of deceased, claimants no.2 being the unmarried daughter
of deceased are each entitled for compensation of
Rs.40,000/-. Thus, they are entitled for Rs.80,000/-
AIR 2009 SC 3104
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towards `loss of consortium'. Under the conventional heads,
is towards loss of estate, funeral expenses & transportation,
the claimants are entitled for compensation at Rs.15,000/-
each i.e. in all Rs.30,000/-. Thus, the claimants are entitled
for compensation of Rs.14,40,956/- rounded off to
Rs.14,41,000/-Thus, the claimants are entitled for
compensation as under:
Heads Amount
Sl. Rs.
No.
1. Loss of Dependency 13,30,956-00
2. Loss of Consortium 80,000-00
(Rs.40,000 x 2)
5. Transportation & Funeral 15,000-00
Expenses
6. Loss of Estate 15,000-00
Total 14,40,956.00
17. Sofar as liability is concerned, claimants are
third parties so also the deceased. It is respondent no.1 who
has violated the policy conditions. But, the claimants being
the third parties cannot be deprived of the compensation
amount as the MV Act is a benevolent legislation. In this
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regard, with regard to deposit of compensation then recover
from owner of the vehicle, as per the facts so brought on
record, the Full Bench judgment of this Court passed by the
then Ladyship Smt.B.V.Nagarathna (now the judge of the
Hon'ble Supreme Court) in the case of New India
Assurance company Limited Bijapur by its Divisional
Manager Vs. Yallavva and Another4 can be made
applicable to the present facts of the case. In the said
judgment, it is held as under:
"36. Thus, on a reading of Section 149, it becomes
clear that when third party risks are involved or when
the victim of the accident is a third party, such risk being
compulsorily covered under sub-Section (1) of Section
147, any exclusion in the policy must be suitably
interpreted having regard to the main purpose for which
an insurance contract is entered into. In Swaran
Singh the Hon'ble Supreme Court has enumerated the
aforementioned twin tests in the above context. It is only
when both the tests are satisfied that the insurer could
be permitted to pay and recover from the insured as per
the proviso to sub-Section (4) of Section 147 otherwise,
no pay and recovery order could be made and the
insurer has to satisfy the award.
ILR 2020 KAR 2239
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37. Thus, what follows is that, in regard to third
party rights, the insurer can defeat such rights under
Section 149(2)(a) by proving a breach of the condition of
the policy and further, proving that the same is a
fundamental breach. In such an event, the insurer can
only mitigate its liability and the insured would be liable
to satisfy the judgment vis-a-vis the insurer who would
have satisfied the claim of the third party in the first
instance. Therefore, the insurer cannot defeat a third
party claim by any exclusion in the policy having regard
to the four comers of Section 149(2)(a). It can only
mitigate its liability by seeking recovery from the insured
on proof of the exclusion clause as per the twin tests
enumerated by the Hon'ble Supreme Court. This is the
object of Section 149(4) and the proviso thereto which
contemplates pay and recovery order to be made against
the insurer who has been notified in a claim proceeding
instituted by a third party under Section 149(1) of the
Act.
The underlining is by this Court
38. To this, another nuance may be added. What
would be the position when the insurer is able to prove a
breach of the policy, but the said breach is not a
fundamental breach or the breach did not contribute to
the cause of the accident but what could be termed as an
innocent breach and not an intentional one. In such a
case also, the Insurance Company must pay to the third
party and recover from the insured. This could be
illustrated with reference to the vehicle not being covered
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by a permit to ply for hire or reward. The Hon'ble
Supreme Court in the case of Amrit Paul Singh v. Tata
Aig General Insurance Co. Ltd [(2018) 7 SCC 558: AIR
2018 SC 2662.] , held that the vehicle not having a
permit at all and being used for hire or reward is a case
of fundamental breach and hence, the insurer though
absolved of its liability had to pay the compensation and
recovery order was made in the said case permitting
recovery from the insured. Also, when a vehicle had a
permit to ply within a particular area or on a route
deviated from the said area or route and was plying in
another area or route and an accident occurred, then it is
not a case of fundamental breach, although, there is a
violation of the terms of the policy. In such an event also,
the pay and recovery order has been made in the case
of Rani v. National Insurance Company Ltd. [(2018) 8
SCC 492.] , by the Hon'ble Supreme Court."
18. So, in view of Full Bench judgment of this Court,
as the claimants are the third parties, therefore the
Insurance Company has to deposit the compensation and
then recover the same from respondent No.2. Even this
Court in other similar cases, have followed the said
judgment of the Full Bench of this Court and has directed
the insurer to deposit the compensation and recover the
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same from the owner of the offending vehicle. In view of
discussion made above, we proceed to pass the following:
ORDER
i) The appeal filed by the claimants is
allowed in-part. The claimants are
held entitled for compensation of
Rs.14,41,000/- as against
Rs.11,11,000/- awarded by the
Tribunal and there is enhancement of
Rs.3,30,000/-. The claimants are
entitled for interest on the entire
compensation amount @ 6% p.a. from
the date of petition till its realization.
ii) Respondents Nos.1 and 2 are jointly
and severally held liable to pay the
compensation. However, respondent
no.2 to deposit the compensation
amount within six weeks from the date
receipt of a certified copy of the
judgment with accrued interest and is
at liberty to recover the same from
respondent no.1 by executing the
award.
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iii) There shall be modified award in the
above terms.
iv) Registry is directed to send back the
Tribunal records along with a copy of
this judgment forthwith.
Sd/-
(B.M.SHYAM PRASAD)
JUDGE
Sd/-
(RAMACHANDRA D. HUDDAR)
JUDGE
SK/ct:VG
