The Oriental Fire and General Insurance Company Ltd. vs Mahila Lolma and Others

B.C. Varma, J.—One Lalmani died as a result of collision between Bus No. M.P.A. 2559 and Truck No. M.P.A. 4750 when he was travelling in the aforesaid bus. The finding of the Claims Tribunal is that it was the driver of the truck who was negligent in driving the truck. Since this appeal is by insurance company, we need not disturb that finding. We, therefore, affirm that finding that Lalmani died owing to negligent driving of truck No. M.P.A. 4750.

This is an appeal by the insurer of the truck. Clearly, in view of Section 96 of the Motor Vehicles Act, the scope of this appeal is to determine the extent of liability of the Insurance Company alone. We, however, find from paragraph 13 of the award that the Claims Tribunal has assigned no reason for awarding the amount of compensation and thus the award is absolutely faulty and illegal. In fact, he does not appear to have applied his mind to legal provisions governing the case. He has not appreciated the evidence. Ordinarily, therefore, the matter should have been remanded back to the Tribunal. But, Shri R.N. Singh, appearing for the claimant, suggested that this Court may itself decide the matter instead of sending it back. We have, therefore, perused the record and find that the deceased Lalmani who was then 45 years of age could have lived for another period of 20 years. His annual income has been found would be Rs. 5000/-. However, out of this he must be taken to be spending Rs. 2000/- on himself and, therefore, annual dependency would come only to Rs. 3000/-. In view of these circumstances, the multiplier to put at the highest would be 12. The compensation thus payable to the claimant would be Rs. 3000 x 12 : 36,000/-. Over and above Rs. 3000/- should be paid for loss to the estate. The Tribunal has also not awarded interest which has since to be awarded in terms of Section 110-CC. We, therefore, award interest at 12 per cent per annum on this sum of Rs. 39000/- from the date of application until realisation. The award shall be substituted accordingly.

We may now come to the main question relating to the liability of the Insurance Company. It it true that in paragraph 14 of the Award, liability of the appellant has been fixed to the limit as in the policy but then the policy has not been filed and, therefore, one has to look only to the statutory provisions. This limit of liability is fixed by Section 95(2)(a) which reads:

(2) Subject to the proviso to Sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely:

(a) Where the vehicle is a goods vehicle, a limit of fifty thousand rupees in all, including the liabilities, if any, arising under the Workmen''s Compensation Act, 1923, in respect of the death of or bodily injury to, employees (other than the driver), not exceeding six in number, being carried in the vehicle;

This, in our opinion, should be the outer limit oF the appellant''s liability. The matter has now been set at rest by the Supreme Court in British Indian General Insurance Company Ltd. v. Smt. Maya Banerjee and Ors. 1986 A.C.J. 946. In that case, deceased, a third party was knocked down by the bus when riding on cycle. In the face of the provision contained in Section 95(2), it was held that the liability of the insurer could not be in excess of the statutory limit. The Court distinguished the earlier decision in New Asiatic Insurance Co. Ltd. Vs. Pessumal Dhanamal Aswani and Others, saying that it was a case of motor car and the decision turned upon the terms of the policy. Applying this decision, we hold that the liability of the Insurance Company/appellant shall not be beyond Rs. 50,000/-.

For the aforesaid reasons, we modify the award made by the Claims Tribunal. We direct that the respondents 2 and 4 shall pay to the claimant/respondent No. 1 a sum of Rs. 39,000/- as compensation. The appellant insurance company in view of Section 95(2)(a) is jointly held liable with these two respondents to the extent of Rs. 50,000/- or less, as the case may be. This amount awarded shall carry interest at 12% per annum from the date of filing of claim application until realization.

With the aforesaid modification, the appeal fails and is dismissed. The parties are directed to bear their own costs throughout.