New India Assurance Co. Ltd. vs Ambika

DESIRABLE it is to pen down a common order in these actions inasmuch as these actions emerge out of an order delivered by the District Consumer Disputes Redressal Forum, Chennai (South) in O.P. No. 332/1997.

THE appellant in A.P. No. 596/1998 is the opposite party New India Assurance Company Ltd., Chennai-8. The appellant in A.P. No. 816/1998 is the complainant Mrs. Ambika, Chennai-2.

Short facts may be related in order to understand the crux of the question involved for consideration in these actions.

THE complainant is the owner of a lorry registered as TN-04-5378. THE vehicle was insured with the opposite party. THE insurance was for a period of one year between 30.8.1994 and 29.8.1995. During the coverture of the policy of insurance, the vehicle met with an accident on 21.6.1995 at 5 a.m. in Prakasam District, Andhra Pradesh State. As a consequence of the accident, the vehicle got heavily damaged. THE matter it appears was reported to the opposite party Insurance Company and the Insurance Company in turn deputed a Surveyor to have an inspection of the vehicle and submit his report. The complainant made a claim on 26.6.1995 supported by bills and vouchers. Bills and vouchers have been produced to the extent of Rs. 61,111.40.

THE Surveyor however had assessed the value of the damage sustained by the vehicle and he quantified the damage in terms of money to the tune of Rs. 14,625/-. THE damage so assessed by the Surveyor according to the complainant is not reflecting the reality of the situation. The opposite party Insurance Company however repudiated the claim by means of a communication dated 7.11.1996. The ground of repudiation was that the driver of the vehicle in question was not having an effective driving licence to drive the vehicle in question at the time of the accident. The act of the opposite party in repudiating the claim, the complainant would say, would tantamount to deficiency in service on their part. In such a backdrop and setting, the complainant knocked at the doors of the Forum below for certain reliefs as prayed for in the complaint.

THE opposite party Insurance Company filed a version in pith and substance contending as below :

NO doubt true it is that the vehicle involved in the accident is insured with them. During the period of accident, the policy was alive. On intimation of the accident, a Surveyor was deputed to have an inspection of the vehicle and submit his report. The Surveyor so deputed after inspection of the vehicle assessed the damage and quantified the same in a sum of Rs. 14,625/-. The claim made by the complainant was repudiated by their letter dated 7.11.1996 on the ground that the driver of the vehicle in question was not having an effective driving licence on the date of the accident. Therefore, the repudiation so made by them cannot at all be stated to be not justifiable on the facts and in the circumstances of the case. As such, there is no deficiency in service on their part. The complaint is, therefore, liable to be dismissed.

The Forum below after taking into consideration the materials placed on record, recorded a finding that the act of the opposite party Insurance Company in repudiating the claim as made by the complainant on the facts and in the circumstances of the case would tantamount to deficiency in service on their part. It is on such a finding the Forum below directed the opposite party Insurance Company to pay a sum of Rs. 61,111.40 spent by the complainant towards repairs inasmuch as the claim so made was fully supported by bills and vouchers. This apart, the Forum below directed the opposite party Insurance Company to pay a sum of Rs. 1,000/- towards costs. The further direction that was issued by the Forum below was that its order had to be complied within a month from the date of its order.

AGGRIEVED by the order as above, the opposite party Insurance Company resorted to file A.P. No. 596/1998 assailing the order of the Forum below as such. The complainant on the other hand resorted to file A.P. No. 816/1998 stating that the Forum below committed a grievous error in not granting interest @ 18% p.a. on Rs. 61,111.40 the quantum of damages as awarded from 26.6.1995 the date of the claim and also not granting compensation for the mental agony and anguish suffered by her quantified in a sum of Rs. 10,000/-. Arguments of learned Counsel Mr. P.V. Raghavan appearing for the appellant/opposite party Insurance Company in A.P. No. 596/1998 and learned Counsel Mr. D. Govinda Reddy appearing for the appellant/complainant in A.P. No. 816/1998 were heard on 20.5.2002 by the President of this Commission sitting along with the learned Member Thiru Kayal Dinakaran. On that day, after making an elaborate submission learned Counsel Mr. P.V. Raghavan appearing for the opposite party Insurance Company in A.P. No. 596/1998 prayed for an adjournment for submission of further arguments on the ground that he had to look into the amendments effected to certain sections of the Motor Vehicles Act, 1988 and the amendment effected if any would have any sort of a bearing in the case on hand. The request so made being genuine and reasonable, it was granted and these matters were adjourned to for further hearing to various dates and finally taken up today. Today ( ) learned Member Thiru Kayal Dinakaran is on leave and he is unable to sit in the Bench. The other learned lady Member, a new appointee, is present. Such being the case, we requested learned Advocates appearing on both the sides to argue the matter de nova right from the beginning for the benefit of the newly appointed lady Member and learned Advocates appearing on both the sides co-operated very nicely in making submissions in a commendable fashion.

THE submissions of learned Counsel Mr. P.V. Raghavan appearing for the opposite party bristles to this : THE Forum below committed a grave error in recording that the driver of the vehicle in question at the time of accident had a valid driving licence without understanding the scope and ambit of the expression an effective driving licence as is used in Section 3 of the Motor Vehicles Act, 1988 (for short, "Act, 1988") which deals with the necessity for driving licence. An effective driving licence consists of two components, namely (1) effective as respects the point of time, and (2) effective as respects the type of the vehicle. THE concept of holding a "valid licence" is different and distinct from the concept of holding an "effective driving licence". THE concept of holding a driving licence would not take in its fold the two facets of an effective driving licence and it is referable only to one of the aspects relatable to the vehicle of a specified description. That means, a person holding a valid licence to drive a light motor vehicle is not entitled to drive another vehicle other than the light motor vehicle. THErefore, for driving motor vehicle of a specified description as found defined under Section 2 of Act, 1988, a separate licence for driving such a vehicle is necessary. Every learner''s licence and driving licence except a driving licence issued under Section 18 shall be in such form and contain such information as may be prescribed by the Central Government as per Sub-section (1) of Section 10 of Act, 1988. Sub-section (2) of the said section prescribes that a learner''s licence or as the case may be, driving licence shall also be expressed as entitling the holder to drive a motor vehicle of one or more of the following clauses, namely : (a) Motor Cycle without gear (b) Motor Cycle with gear (c) Invalid carriage (d) Light Motor Vehicle (e) Medium Goods Vehicle (f) Medium Passenger Motor Vehicle (g) Heavy Goods Vehicle (h) Heavy Passenger Motor Vehicle (i) Road Roller (j) Motor Vehicle of a specified description. Clauses (e) to (h) of Sub-section (2) of Section 10 of Act, 1988 had been amended by Act No. 54 of 1994 by substitution of those clauses by a new clause "(e) Transport Vehicle" with effect from 14.11.1994.

Motor vehicle of a specified description under Clause (j) of Sub-section (2) of Section 10 subsequent to amendment of the said section by Act No. 54 of 1994 retains the same shape as before. Most of the definition clauses in Section 2 of Act, 1988 even subsequent to the amendment Act No. 54 of 1994 retains the same shape as before. Section 2 Clause 16 defines heavy goods vehicle while Section 2 Clause 17 defines a heavy passenger motor vehicle. Pertinent it is to remember here that these two clauses namely, Clauses 16 and 17 of Section 2 are not affected by the amendment Act No. 54 of 1994. According to Clause 16 of Section 2, ''Heavy Goods Vehicle'' means any goods carriage the gross vehicle weight of which, or a tractor or a road-roller the unladen weight of either of which exceeds 12,000 kilograms. As per Clause 17 of Section 2, a ''heavy passenger motor'' vehicle means any public service vehicle or private service vehicle or education institution bus or omnibus the gross vehicle weight of any of which, or any motor car the unladen weight of which exceeds 12,000 kilograms. The driver of the vehicle in question was the original holder of a licence to drive light motor vehicle L. No.15300-31/N-1978. The licence was latterly converted and he was authorised to drive as a professional paid employee. Thereafter on 7.11.1979 an endorsement was made in his licence authorising him to drive public service vehicle within Tamil Nadu. There was further endorsement made on 12.1.1995 in his licence empowering him to drive heavy passenger transport vehicle. The vehicle in question which met with an accident on 21.6.1995 was admittedly a heavy goods vehicle namely, a lorry. Such being the case, the driver of the lorry in question at the relevant point of time of accident cannot at all be stated to be in possession of an effective driving licence inasmuch as even subsequent to the amendment of Section 10 of Act, 1988 by Act No. 54 of 1994, Clause (j) of Section 10(2) thereof was retained in its original shape as before and also Section 2(16) and 2(17) defining respectively heavy goods vehicle and heavy passenger motor vehicle.

IN support of his contention that the driver of the vehicle in question was not in possession of an effective driving licence on the date of the accident, solidified support is sought for from certain decisions emerging from superior Courts of jurisdiction. They are as below : (1) Ashok Gangadhar Maratha v. Oriental INsurance Co. Ltd., III (1999) CPJ 5 (SC)=VII (1999) SLT 168. (2) National INsurance Company Ltd. v. Rangasamy & Anr., ILR (1997) 1 Madras 731. (3) National INsurance Co. Ltd. v. Sundar Raj & 2 Ors., 2000 (1) CTC 521.

ONCE it is found that the driver of the vehicle in question has no effective driving licence on the date of the accident, then it cannot at all be stated that the repudiation of the claim as made by the opposite party Insurance Company is not justifiable. Repudiation being justifiable the question of grant of compensation for the damages said to have been sustained by the vehicle in the accident will not at all arise for consideration. Even otherwise, the complainant is not at all entitled by way of damages to any amount more than the one as found by the Surveyor deputed by the opposite party Insurance Company at Rs. 14,625/- and the grant of compensation by way of damages by the Forum below quantified in a sum of Rs. 61,111.40 is not sustainable in law. The submissions of learned Counsel D. Govinda Reddy appearing for the complainant in pith and substance reflected as below.

A discordant note is struck to the projection of hues of views as aired by learned Counsel Mr. P.V. Raghavan appearing for the opposite party. The order of the Forum below as relatable to the recording of a finding of deficiency in service on the part of the opposite party Insurance Company or the grant of compensation quantified in a sum of Rs. 61,111.40 for the repairs effected to the vehicle met with an accident during the coverture of the policy cannot at all be stated to be not sustainable on the facts and in the circumstances of the case. The non-grant of any interest for the claim made on and from the date of claim petition which event happened on 26.6.1995 is not justifiable on the facts and in the circumstances of the case. It would be but proper for the Forum below to have granted interest @ 18% p.a. on the quantum of compensation granted by way of damages quantified in a sum of Rs. 61,111.40 on and from the date of the claim petition. This apart, the Forum below also committed a grievous error in not granting any compensation for the mental agony and anguish suffered as a consequence of deficiency in service on the part of the opposite party Insurance Company. It would be fit and proper for the grant of compensation quantified in a sum of Rs. 10,000/- for the mental agony and anguish sustained by the complainant.

THE projection of hues of views of learned Counsel appearing for the respective parties may fall for consideration in the arena of discussion to be ensued hereafter. No doubt true it is that the driver of the vehicle in question was possessed of a licence empowering him to drive a heavy passenger transport vehicle at the time of the accident as evidenced by Ex. A2. Admittedly, the vehicle driven by him at the time of accident was a heavy goods vehicle namely, a lorry. The moot question that arises for consideration herein is as to whether the driver of the vehicle in question having in possession of a licence to drive a heavy passenger transport vehicle shall be construed as having an effective driving licence to drive the heavy goods vehicle namely, lorry at the time of accident. The argument of learned Counsel Mr. P.V. Raghavan appearing for the opposite party that the possession of such a licence by the driver of the vehicle in question at the point of time cannot at all be construed as having an effective driving licence cannot at all be expected to commend acceptance at our hands. The reasons are manifold. Section 10(2) of Act, 1988 had been amended by Act No. 54 of 1994. Under the Amendment Act, Clauses (e) to (h) had been substituted by a new Clause ''(e) transport vehicle''. While doing so of course Clause (j) of Sub-section (2) of Section 10 was retained in its original shape as motor vehicle of a specified description. This apart, the definition Clauses 16 and 17 of Section 2 defining heavy goods vehicle and heavy passenger motor vehicle also remained unaltered. The fact that Clause (j) of Sub-section (2) of Section 10 and Clauses 16 and 17 of Section 2 remained unaltered is of no consequence even subsequent to the amendment brought in by Act No. 54 of 1994 by the substitution of Clauses (e) to (h) by the incorporation of a new clause ''(e) transport vehicle''. It is of signal significance to refer to at this juncture the definition of a ''transport vehicle'' figuring under Sub-clause (47) of Section 2 according to which " ''transport vehicle'' means a public service vehicle, a goods carriage, an educational institution bus or a private service vehicle". The said definition under Sub-section (47) of Section 2 was not at all altered by the Amendment Act No. 54 of 1994. Under the said definition, four types of vehicles are referred to namely, (1) public service vehicle, (2) goods carriage, (3) education institution bus, and (4) a private service vehicle. All those vehicles as described above are defined respectfully under Clauses 35, 14, 11 and 33 of Section 2. The definitions of those vehicles in those provisions are not at all necessary for the purpose of our enquiry in the case on hand. It cannot at all be stated as had been said by learned Counsel appearing for the opposite party that in view of the fact that the driver of the vehicle in question was not in a possession of a licence for heavy goods vehicle, the driver of the vehicle was not having effective licence for driving the vehicle in question involved in the accident. This will be made crystal clear if we have an insight of the description of vehicles under Clauses (e) to (h) of the unamended 1988 Act. We have already referred to elsewhere those clauses as it existed prior to amendment in the Act. Of those four clauses, Clauses (g) and (h) are relevant for the present purpose. We may recapitulate here that Clause (g) therein is relatable to heavy goods vehicle while clause (h) is relatable to heavy passenger motor vehicle. Apart from these two types of vehicles, the other two types of vehicles namely, medium goods vehicle and medium passenger motor vehicle as found stated respectively in Clauses (e) and (f) are also of some relevance. The moment all these clauses are merged into one clause as "(e) transport vehicle" it means that a person having possession of licence to drive vehicles of any of the descriptions as found mentioned in Clauses (e) to (h) of the Act, 1988 previous to amendment, would be suffice for such a person to drive not only the vehicle in respect of which he had obtained a licence but also to drive the other vehicles found mentioned in those clauses. We have to state here by way of reiteration for the sake of emphasis that the driver of the vehicle in question had admittedly had a driving licence for heavy passenger transport vehicle. Such being the case, he would be definitely entitled to drive a heavy goods vehicle, that is to say, a lorry. If one gives another interpretation other than this, it will lead to catastrophic results making nonsense of the amendment brought in by Act No. 54 of 1994. If such be the interpretation, the question may arise for consideration what is the effect of retention of Clause (j) of Sub-section (2) of Section 10 even subsequent to the amendment. The question so posed is of course problematic. Every problem if approached in the proper perspective is capable of solution. The approach to be made in untying the knot of the naughty problem posed herein is this : The contextual interpretation without making the amendment a nonsensical one if resorted to be given, it would mean that in respect of the vehicles other than the vehicles of the description as found mentioned in Clauses (e) to (h) of the Act, 1988 previous to amendment the person to drive such vehicles must have to procure a specific licence to drive those vehicles and then only the licence so obtained by him shall be deemed to be an effective driving licence to drive the vehicle.

WE can make a short work of the various judgments emerging from the superior Courts of jurisdiction, that is to say, one emerging from the Supreme Court of India and two emerging from the High Court of Judicature at Madras as referred to above. All those judgments had not the occasion to consider the effect of the amendment brought in by Act No. 54 of 1994 by the substitution of Clauses (e) to (h) by the incorporation of a new Clause (e) under Section 10(2) of the Act, 1988. In the case on hand, the amendment brought in to Sub-section (2) of Section 10 of Act, 1988 by amendment of Act No. 54/1994 played a major role on the factual matrix of the case in coming to a conclusion. Such being the case, there is no other go for us to brush aside the judgments as referred to above saying that although the decisions rendered by those superior Forums are applicable to the facts of those cases, yet the same cannot have any sort of a say in rather a bid to answer the naughty question posed for consideration in the instant case. The resultant product of the discussion as above, we are of the view will lead to the irresistible conclusion that the driver of the vehicle in question was having an effective driving licence to drive the vehicle in question at the time of accident. Such being the case, the repudiation of the claim made by the complainant by the opposite party Insurance Company will definitely tantamount to deficiency in service on their part. No doubt true it is that the rationale or reasoning as we have given for arriving at a conclusion that there was deficiency in service on the part of the opposite party are altogether different, distinct and new from the rationale or reasoning given by the Forum below for arriving at such a conclusion. That is of no consequence. The reasons are rather obvious. Appeal is a continuation of original proceedings. The Commission as a Forum of first appeal is entitled to sift and analyse the materials placed on record as a Forum of first instance and come to a conclusion as the one arrived at by the Forum below for altogether different reasons. That is exactly what we have done in this case.

THE Forum below granted compensation by way of damages quantified in a sum of Rs. 61,111.40 towards damages sustained by the vehicle in question sustained in the accident. THE award so made is actually based upon the bills and vouchers produced by the complainant as evidenced by Exs. A8 and A9. Such an award cannot at all be found fault with and there is no rhyme or reason for us to reduce the award so made to the level of the assessment of damages sustained by the vehicle as recommended by the Surveyor whose report has been marked as Ex. B1. THE Surveyor simply quantified the damages on estimation without realities of the actual situation. To such a report, we are unable to give our seal of approval and consequently reduce the compensation by way of damages as awarded by the Forum below to the level of the compensation as recommended by the Surveyor. In this view of the matter, the compensation as granted by the Forum below towards the damages sustained by the vehicle in question is confirmed.

NO doubt, the Forum below neither granted interest at a reasonable rate on the compensation amount nor awarded any compensation for mental agony and anguish suffered by the complainant. As per the dictum of superior Forums, either one of these two things is grantable. If interest at the appropriate and reasonable rate is awarded, the question of grant of compensation for mental agony and anguish cannot at all arise for consideration. If compensation for mental agony and anguish is granted, the question of grant of appropriate and reasonable interest on the amount of compensation will never arise consideration. In the case on hand, we are inclined to grant interest on the amount of compensation of Rs. 61,111.40. The question then arises for consideration is what is the appropriate rate of interest to be granted and the next question that arises for consideration is the date on which such rate of interest is to be granted. Pertinent it is to refer to at this juncture the case of Smt. Kaushnuma Begum & Ors. v. New India Assurance Co. Ltd. & Ors., I (2001) ACC 300=I (2001) SLT 151=AIR 2001 SC 485. What the Supreme Court said in paragraph 24 is relevant for the present purpose and it reads as under : "24. Now, we have to fix up the rate of interest. Section 171 of the Motor Vehicles Act empowers the Tribunal to direct that "in addition to the amount of compensation simple interest shall also be paid at such rate and from such date not earlier than the date of making the claim as may be specified in this behalf". Earlier, 12% was found to be the reasonable rate of simple interest. With a change in economy and the policy of the Reserve Bank of India the interest rate has been lowered. The nationalised Banks are now granting interest at the rate of 9% on fixed deposits for one year. We, therefore, direct that the compensation amount fixed herein before shall bear interest at the rate of 9% per annum from the date of the claim made by the appellants. The amount of Rs. 50,000/- paid by the Insurance Company under Section 140 shall be deducted from the principal amount as on the date of its payment, and interest would be recalculated on the balance amount of the principal sum from such date."

Pursuant to the decision of the Supreme Court as above, we are inclined to grant interest @ 9% p.a. on the quantum of compensation of Rs. 61,111.40. The superior Courts of jurisdiction also laid down the dictum that a reasonable time must have to be given for the opposite party like the Insurance Company for the settlement of claim from the date of the claim petition. Reasonable time in most of the cases the superior Courts of jurisdiction said is roughly about three months from the date of the claim petition. In the decision we have cited for reducing the rate of interest, the Supreme Court granted interest on and from the date of the claim petition. In so many other cases, the Supreme Court itself laid down the dictum that it would be proper to award interest after giving a reasonable time from the date of the claim petition. Reasonable time had also been construed as giving of three months from the date of the claim petition. Therefore, we are inclined to grant interest @ 9% p.a. on the quantum of compensation of Rs. 61,111.40 after the expiry of three months from the date of the claim petition which event will fall on 26.9.1995 till realisation.

IN fine, except to the extent of the modification as we have made to the order of the Forum below, both the appeals namely, A.P. Nos. 596/1998 and 816/1998 shall stand dismissed in other respects. We however make no order as to costs on the facts and in the circumstances of the case. We are however making it crystal clear that the award of the Forum below as modified by us is required to be complied with by the opposite party within a month from the date of the receipt of our order or otherwise it would be perfectly open for the complainant to invoke the jurisdiction under Section 27 of the Consumer Protection Act, 1986. Appeals dismissed.