National Insurance Company Ltd. vs Savitri Devi and Others

G.P. Mittal, J.—The Appellant National Insurance Company Limited impugns a judgment dated 12.06.2007 whereby a compensation of Rs.8,00,000/- was awarded for the death of Rishal Singh Gill who died in a motor accident which occurred on 04.10.2005. The Motor Accident Claims Tribunal (the Claims Tribunal) while passing the impugned judgment held that Respondents No. 1 to 6 were unable to prove that the accident was caused on account of default, neglect or inaction of the driver of the tempo No. DL-ILG-1492 (Respondent No. 7).

The Claims Tribunal on the basis of the judgment of this Court in Bala and Others Vs. Moti Chand Gupta and Others, , held that the Court can take recourse of Section 163A of the Act and grant relief in cases where negligence is not proved.

The Claims Tribunal believed the deceased''s salary as a Munim to be Rs.5,000/- per month, made a deduction of one-fourth towards the personal and living expenses and awarded a compensation of Rs.7,20,000/- towards loss of dependency, Rs.60,000/- towards loss of love and affection and Rs.20,000/- towards last rites, to award an overall compensation of Rs.8,00,000/-.

There is twin challenge to the impugned judgment. Firstly, the learned counsel for the Appellant Insurance Company argues that a Claim Petition u/s 166 of the Act could not have been converted to the one u/s 163A of the Act without an application being moved by the Claimants. Secondly, in a Petition u/s 163A of the Act, the compensation has to be awarded strictly as per the structured formula.

It may be noticed that in pursuance of the order of this Court dated 15.05.2008 on deposit of the award amount, 50% of the amount was to be released in favour of Respondents No. 1 to 6 in terms of the order passed by the Claims Tribunal. The said 50% already stands released to Respondents No. 1 to 6 by order dated 15.05.2008. Thereafter, there is no appearance on behalf of Respondents No. 1 to 6. There is implied consent to the conversion of the Petition u/s 166 of the Act to one u/s 163A of the Act.

It is well settled that a Claim Petition u/s 163A of the Act can be entertained only in cases where the income of the deceased or the injured is upto to Rs.40,000/-. Deepal Girishbhai Soni and Others Vs. United India Insurance Co. Ltd., Baroda, and MAC APP.304/2009 titled New India Assurance Co. Ltd. v. Pitamber & Ors., decided on 23.01.2012).

The compensation in a Petition u/s 163A of the Act indubitably has to be awarded as per the structured formula and the multiplier has to be taken into consideration as given in the second schedule to calculate the loss of dependency. I. Damodaran and Another Vs. M.K. Valsala and Others,

The Claimants (the Respondents No. 1 to 6) claimed that the deceased Rishal Singh Gill was working as a Munim with M/s. Mahindra Flour Mills, DSIDC Industrial Area, Bawana and was getting a salary of Rs.5,000/- per month. In cross-examination, the first Respondent admitted that she did not possess any document to show that the deceased was employed in the Flour Mills at Delhi and was earning Rs.5,000/- per month. In the circumstances, the deceased''s income should have been taken to be that of an unskilled worker as fixed under the Minimum Wages Act by the Govt. of NCT of Delhi. The minimum wages on 04.10.2005 were Rs.3165/- per month.

The loss of dependency thus comes to Rs.4,05,120/- (3165/- x 12 x 2/3 x 16).

On addition of the conventional sums of Rs.9,500/- i.e. Rs. 2,000/- towards loss to estate, Rs.2,500/- towards funeral expenses and Rs.5,000/- towards loss of consortium, the overall compensation comes to Rs. 4,14,620/-.

Thus the compensation stands reduced from Rs. 8,00,000/- to Rs. 4,14,620/-.

50% of the compensation i.e. Rs. 4,00,000/- with proportionate interest has already been released in favour of the Claimants as aforesaid. Rest of the amount of Rs. 14,620/- along with proportionate interest shall be paid to the first Respondent.

The balance amount of Rs. 3,85,380/- along with proportionate interest and the interest accrued, if any, during the pendency of the Appeal shall be refunded to the Appellant Insurance Company.,

The statutory amount of Rs. 25,000/- shall also be refunded to the Appellant Insurance Company. The Appeal is allowed in above terms.