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Judgment
Sandeep Mehta, J.�These four appeals arise out of the judgment and award dated 27.3.2001 passed by the learned Judge, Motor Accident Claims Tribunal No. 1, Jodhpur in two separate accident claim cases filed before it in relation to an accident, which occurred on 4.2.1996 near Pal Village, Jodhpur.
As per the facts available on record, the deceased Pema Ram and Ganga Ram were proceeding from Jodhpur to village Gangana on a Yamaha motorcycle. When they reached the outskirts of the village Pal, opposite a shop named Peva Marbles, the respondent Munna @ Muneer Khan driving the truck No. RSN-5383 rashly and negligently on the wrong side of the road, collided with the motorcycle resulting into the death of Pema Ram and Ganga Ram on the spot.
Two separate claim petitions were filed by the legal heirs of Pema Ram and Ganga Ram being MAC No. 221/96 and MAC No. 226/96 claiming compensation for the deaths of Pema Ram and Ganga Ram respectively, impleading the owner and the driver of the truck namely Anwar Khan and Munna @ Muneer Khan and the insurer of the truck the New India Insurance Co. Ltd. as defendants.
The owner and the driver of the truck on appearing, took a plea that as a matter of fact, no accident occurred by the truck in question. It was claimed that Pema Ram and Ganga Ram met with an accident with some unknown vehicle resulting into their death. The police falsely implicated them in the case despite the fact that the truck No. RSN-5383 was not responsible for the accident.
The insurance company filed a written statement challenging the claim petitions claiming that no accident took place with the insured vehicle. It was claimed that the Police had falsely implicated the truck owner and that the insured truck was not involved in the accident. The insurance company also took an objection that the driver of the truck was having a licence to drive only a light motor vehicle whereas, at the time of the accident he was driving a truck which was a heavy transport vehicle. Thus, it was claimed that the truck driver was not having a valid licence to ply the truck in question and therefore, the insurance company was not responsible to satisfy the claim as there was a breach of condition of the policy by the owner of the truck.
Learned Tribunal framed the following issues to be decided:-
Based on the evidence adduced by the parties, the learned Tribunal decided the issue No. 1 regarding the truck being driven rashly and negligently and resulting into the accident, in favour of the claimants. It was noted that the truck owner and driver did not appear in evidence to controvert the claim that the truck in question was involved in the accident or that it was not driven rashly and negligently by the driver. The issue No. 2 regarding the truck being insured with the insurance company was decided against the insurance company as the said fact was not contested by the insurance company.
The Issue No. 3 regarding the objection of the truck driver not having a valid driving licence to drive the heavy transport vehicle and thereby there being a breach of policy conditions was decided in favour of the insurance company. At the same time, the learned Tribunal held that the insurance company was liable to satisfy the claim and thereafter to recover the amount from the insured. Appeals by the Insurance Company:-
"The insurance company has approached this Court by way of two appeals being CMA No. 647/2001 filed against the legal representatives of the deceased Ganga Ram and CMA No. 666/2001 filed against the legal representatives of the deceased Pema Ram praying therein that the direction given by the learned Tribunal to the insurance company to make payment of the awarded sum to the claimants and then recover the same from the insured is illegal and contrary to law of the land. Challenge has also been made to the method of calculation adopted and the quantum of compensation awarded by the learned Tribunal."
Shri Jagdish Vyas learned counsel for the insurance company vehemently contended that it is a clear case of gross and fundamental breach of the policy conditions. As per the defence available to the insurance company under Section 149(2) of the Motor Vehicles Act, the insurance company was not liable to cover the risk in the following conditions:-
"(1) Where the effected person was not a third party.
(2) Where there was a policy but there is violation of policy conditions.
(3) Where no policy exists.
Learned counsel for the appellant insurer placed reliance on the following decisions of Hon''ble Supreme Court:-
(1) National Insurance Co. Ltd. Vs. Kusum Rai and Others,
(2) National Insurance Co. Ltd. Vs. Swaran Singh and Others,
(3) Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, "
Shri Vyas vehemently contended that it is a case where the driver of the vehicle was not possessing a licence to drive a commercial/transport vehicle and thus, there was a fundamental breach of conditions of policy and in that situation, the insurance company is entitled to raise the defence available to it under Section 149 of the Act. He submitted that the owner of the offending vehicle cannot claim that he had no liability to verify the fact as to whether the driver of the vehicle was possessing a valid licence or not. He submitted that in the case of Kusum Rai (supra), the Hon''ble Supreme Court held that the owner would be liable for payment of compensation where the driver was not having a licence. He also placed reliance on the decision rendered by the Hon''ble Single Benches of this Court in the cases of Vela & Anr. v. Babu @ Badiya & Ors. reported in 2012 RAR 9 (Raj.) and New India Assurance Co. Ltd. Vs. Smt. Magi and Others, in support of his contentions.
Per contra, learned counsel appearing for the claimants placed reliance on the decisions rendered by the Hon''ble Supreme Court in following cases:-
"(1) National Insurance Co. Ltd. Vs. Swaran Singh and Others,
(2) Kusum Lata and Others Vs. Satbir and Others,
(3) National Insurance Co. Ltd. Vs. Geeta Bhat and Others,
(4) National Insurance Co. Ltd. Vs. Laxmi Narain Dhut,
(5) New India Assurance Co. Ltd. Vs. Vimal Devi and Others,
(6) Oriental Insurance Co. Ltd. Vs. Angad Kol and Others,
(7) S. Iyyapan Vs. United India Insurance Company Ltd. and Another,
(8) Santosh Devi Vs. National Insurance Company Ltd. and Others,
Learned counsel for the claimants and Shri Rajesh Panwar assisting the Court referred to the policy conditions particularly the avoidance clause thereof and submitted that in view of the said clause, the right of any person either indemnified by the policy or any other person to recover the amount from the insurance company under the Policy by virtue of the provisions of the Motor Vehicles Act has been saved. Simultaneously, the right of the insurance company to recover the amount from the insured is also provided in the said avoidance clause. Learned counsel referred to the judgment rendered by Hon''ble Supreme Court in the case of Vimal Devi (supra) wherein the Hon''ble Supreme Court considered the effect of the avoidance clause and held that the avoidance clause in the policy makes all the difference and the direction of the High Court to the insurance company to make payment of the full amount of compensation to the claimants and to recover its dues from the owner is in consonance with the avoidance clause. Hon''ble Supreme Court considered the effect of the Constitution Bench Judgment in the case of New India Assurance Co. Ltd. Vs. C.M. Jaya and Others, and held that the said judgment did not devolve any benefit to the insurance company.
After having given thoughtful consideration to the arguments advanced by the learned counsel for the parties, this Court is of the opinion that the issue more or less is covered by the three Judges Bench decision of the Hon''ble Supreme Court in the case of Swaran Singh (supra). The Hon''ble Supreme Court in the said case considered the earlier judgments rendered by the Hon''ble Apex Court in reference to Section 149 of the Motor Vehicles Act and held as below:
"(iii) The breach of policy condition e.g., disqualification of driver or invalid driving licence of the driver, as contained in subsection (2)(a)(ii) of section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time.
(iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish ''breach'' on the part of the owner of the vehicle; the burden of proof wherefor would be on them.
(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under section 149(2) of the Act."
In the case of S. Iyyapan also, the driver of the vehicle was having a licence to drive a light motor vehicle and the licence was not having any endorsement authorising him to drive a maxi cab. The Hon''ble Supreme Court held that mere absence of endorsement on the licence of a driver to drive a maxi cab would not exonerate the insurance company of the liability to make payment of the claim amount. The Hon''ble Supreme Court considered a few fundamental breaches in that case whilst dealing with the facts in para 17 and 18 of the judgment and held as under:-
"17. The heading "Insurance of Motor Vehicles against Third Party Risks" given in Chapter XI of the Motor Vehicles Act, 1988 (Chapter VIII of 1939 Act) itself shows the intention of the legislature to make third party insurance compulsory and to ensure that the victims of accident arising out of use of motor vehicles would be able to get compensation for the death or injuries suffered. The provision has been inserted in order to protect the persons travelling in vehicles or using the road from the risk attendant upon the user of the motor vehicles on the road. To overcome this ugly situation, the legislature has made it obligatory that no motor vehicle shall be used unless a third party insurance is in force.
Reading the provisions of Sections 146 and 147 of the Motor Vehicles Act, it is evidently clear that in certain circumstances the insurer''s right is safeguarded but in any event the insurer has to pay compensation when a valid certificate of insurance is issued notwithstanding the fact that the insurer may proceed against the insured for recovery of the amount. Under Section 149 of the Motor Vehicles Act, the insurer can defend the action inter alia on the grounds, namely, (i) the vehicle was not driven by a named person, (ii) it was being driven by a person who was not having a duly granted licence, and (iii) person driving the vehicle was disqualified to hold and obtain a driving licence. Hence, in our considered opinion, the insurer cannot disown its liability on the ground that although the driver was holding a licence to drive a light motor vehicle but before driving light motor vehicle used as commercial vehicle, no endorsement to drive commercial vehicle was obtained in the driving licence. In any case, it is the statutory right of a third party to recover the amount of compensation so awarded from the insurer. It is for the insurer to proceed against the insured for recovery of the amount in the event there has been violation of any condition of the insurance policy."
In the case of Angad Col also, the driver of the offending vehicle had a licence to drive a light motor vehicle and was driving the transport vehicle. In that case also, the Hon''ble Supreme Court directed the insurer to deposit the compensation amount with liberty to recover the same from the owner and driver of the vehicle.
This Court in the case of Girdhar Kanwar (Smt.) Vs. New India Assurance Co. Ltd. and Others, considered the effect of the avoidance clause and the decision rendered by the Hon''ble Supreme Court in the case of Vimal Devi (supra) and held as under:-
"26. The Hon''ble Supreme Court in a recent case of New India Assurance Co. Ltd. Vs. Vimal Devi and Others, relying on the ''Avoidance of Certain Terms and Right of Recovery'' clause in the policy and provisions of Section 96 of the Motor Vehicles Act, 1939 (which is in pari materia with Section 149 of the Act of 1988) upheld the direction to the Insurance Company to make payment to the claimant and to recover its dues from the owner of the vehicle."
The other judgments cited by the learned counsel for the appellant insurance company are distinguishable because the said judgments have not dealt with the issue of validity of the direction given to the insurance company to ''Pay and Recover''.
Thus, in view of the conclusive pronouncements rendered by the Hon''ble Supreme Court and this Court''s judgment in Girdhar Kanwar''s case, which have been noted above, this Court feels that the decisions cited by learned counsel for the appellant insurance company are of no avail to him. The two Single Bench decisions rendered by this Court in the case of Vela and Magi (supra) are also of no avail to the insurance company in this case. The decision rendered by this Court in the case of Magi (supra) runs contrary to the propositions as laid down by the Hon''ble Supreme Court in the cases of S. Iyyapan and Vimal Devi (supra).
In view of the aforesaid discussion, the view taken by the learned Tribunal that the insurance company was liable to make payment of the claim and thereafter to recover the same from the insured is just and proper and does not call for any interference in the appeals preferred by the insurance company.
Appeals by the claimants for enhancement:-
Two appeals have been filed by the claimants being CMA No. 721/2001 filed by Smt. Devi and others the legal representatives of deceased Pema Ram and CMA No. 722/2001 filed by Smt. Sukhi Devi and others the legal representatives of deceased Ganga Ram, praying for enhancement of the awarded compensation.
The learned Tribunal framed the issue No. 4 for deciding the quantum of compensation payable to the claimants of the two deceased. Both the cases are being dealt with individually.
In the claim petition No. 221/96 (CMA No. 666/2001) filed on behalf of the claimants who are legal heirs of deceased Pema Ram, the calculations made and conclusions drawn by the learned Tribunal in relation to this issue are as below.
Learned counsel for the claimants submitted that even by conservative estimate, a person working in a tractor repairing workshop at the relevant time i.e. in the year 1996, could be expected to earn at least Rs. 100/- per day. Meaning thereby that his minimum income would be at least about Rs. 3000/- per month. Learned counsel further submitted that in the said amount, future enhancement to the tune of 30% has to be added. It was further submitted that as the dependents of deceased Pema Ram are 6 in number, the deduction towards his personal expenditure should be taken to be 1/5th. Learned counsel thus submitted that the amount of Rs. 10,000/- awarded to the wife Smt. Devi towards loss of consortium so also the sum of Rs. 2500/- each awarded to the children towards loss of love and affection, is too meager and the same deserve to be enhanced suitably.
Shri Vyas learned counsel for the insurance company on the other hand opposed the aforesaid propositions advanced by the learned counsel for the appellant and submitted that no interference is called for in the findings of the learned Tribunal regarding the quantum of compensation. Rather he submitted that the quantum is excessive and should be reduced.
I have given my thoughtful consideration to the arguments advanced by the learned counsel for the parties and have perused the impugned award as well as the law laid down by the Hon''ble Supreme Court in various cases referred to above.
The learned Tribunal erred on following counts while granting compensation to the claimants.
"(1) No addition was made towards future prospects and income of the deceased.
(2) The deduction of 1/3rd amount towards the personal expenditure and needs was improper looking to the number of dependents i.e. 6.
(3) Appropriate amount was not awarded to the wife for loss of consortium and to the children for the loss of love and affection."
Thus, enhancement deserves to be directed in the compensation awarded to the appellants on the following heads keeping in view the judgments of the Hon''ble Apex Court in the case of Santosh Devi v. National Insurance Co. Ltd. & Anr. reported in AIR 2012 SC-2185, Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, and Rajesh and Others Vs. Rajbir Singh and Others, .
The learned Tribunal has deducted 1/3rd amount from the monthly income of the deceased as his personal expenditure which is not in consonance with the judgment passed by the Hon''ble Supreme Court in Santosh Devi Vs. National Insurance Company Ltd. and Others, . Thus, the deduction of 1/3rd under the head personal expenditure made by the learned Tribunal deserves to be altered. As the claimants are six in number, the deduction towards personal expenditure and needs of the deceased from the income would be 1/5th.
The Hon''ble Supreme Court in Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, while considering principles laid down in its earlier decisions viz. M/s. Estralla Rubber Vs. Dass Estate (Pvt.) Ltd., and U.P. State Road Transport Corporation and Others Vs. Trilok Chandra and Others, , has formulated a table evolving the multiplier to be applicable as per the age group. Applying the said table in the present case, the multiplier of 17 as applied by the learned Tribunal is just and proper.
Applying the principles enunciated in Santosh Devi''s Case, and looking to the fact that the deceased was a semi-skilled labourer, 30% addition towards future prospects and rise in income has to be added to the annual income of the deceased.
In view of what has been discussed above the following calculations can be made for deciding the quantum of compensation awardable to the Claimants Appellants:-
The payment of the original awarded amount shall be made in terms of the order passed by the learned Tribunal, whereas on the enhanced amount, the claimants shall be entitled to an interest @ 7.5% per annum from the date of filing of the claim petition. Out of the enhanced amount, 55% shall be paid to the appellant No. 1 Smt. Devi, 25% shall be paid to the claimants No. 5 and 6 being the mother and father of the deceased Pema Ram and the remaining 20% shall be paid to the children of the deceased.
In the claim petition No. 226/96 (CMA No. 647/2001) filed on behalf of the claimants who are legal heirs of deceased Ganga Ram, the calculations made and conclusions drawn by the learned Tribunal in relation to this issue are as below:
Learned counsel for the claimants submitted that the deceased Ganga Ram was a driver at the time of accident and was drawing a salary of Rs. 2500/- per month. Not only this, the deceased was also drawing an additional amount of Rs. 125/- per month as Dearness Allowance and other Allowances as well. Meaning thereby that his minimum income would be at least about Rs. 3000/- per month. Learned counsel further submitted that in the said amount, future enhancement to the tune of 30% has to be added. It was further submitted that as the dependents of deceased Ganga Ram are 7 in number, the deduction towards his personal expenditure should be taken to be 1/5th. Learned counsel thus submitted that the amount of Rs. 8000/- awarded to the wife Smt. Sukhi towards loss of consortium so also the sum of Rs. 2500/- each awarded to the children towards loss of love and affection and Rs. 2500/- each awarded to the parents towards loss of service, is grossly inadequate and the same deserve to be enhanced suitably.
Shri Vyas learned counsel for the insurance company on the other hand opposed the aforesaid propositions advanced by the learned counsel for the appellants and submitted that no interference is called for in the findings of the learned Tribunal regarding the quantum of compensation. Rather he submitted that the quantum is excessive and should be reduced.
I have given my thoughtful consideration to the arguments advanced by the learned counsel for the parties and have perused the impugned award as well as the law laid down by the Hon''ble Supreme Court in various cases referred to above.
In the opinion of this Court, the learned Tribunal without any basis, logic and reasoning, conjecturally determined the dependency of the claimants to be Rs. 18,000/- per annum. According to the learned counsel for the claimants, the deceased Ganga Ram was a salaried person and was drawing a salary of Rs. 3000/- per month including allowances. No documentary proof however was produced on record to prove the said income. Despite that, there was no reason to disbelieve that the deceased was earning Rs. 2500/- per month. In view of the legal propositions discussed supra, the following calculations and conclusions can be drawn for deciding the quantum of compensation:-
The payment of the original awarded amount shall be made in terms of the order passed by the learned Tribunal, whereas on the enhanced amount, the claimants shall be entitled to an interest @ 7.5% per annum from the date of filing of the claim petition. Out of the enhanced amount, 55% shall be paid to the appellant No. 1 Smt. Sukhi, 25% shall be paid to the claimants No. 6 and 7 being the mother and father of the deceased Pema Ram and the remaining 20% shall be paid to the children of the deceased.
The learned Tribunal shall be at discretion to disburse the awarded amount in appropriate proportions of cash and Fixed Deposits in its wisdom looking to the facts and circumstances of the case. Any amount already paid by the insurance company under Section 140 and/or proviso to Section 173 or any other amount, shall be adjusted towards the amount finally awarded by this Court.
Accordingly, the appeals filed by the insurance company being CMA No. 647/2001 and 666/2001 are rejected and the appeals filed by the claimants being CMA No. 721/2001 and 722/2001 are partly allowed as aforesaid.
There shall be no order as to costs.
Record of the learned Tribunal be sent forthwith.