United India Insurance Company Limited vs Kirna Devi & Others

Sushil Kukreja, J

Since all these appeals are the offshoot of impugned award dated 01.05.2023, passed by learned Motor Accident Claims Tribunal, Kinnaur at Rampur Bushahr, District Shimla, H.P. (hereinafter referred to as the learned “Tribunal below”) in MACT Case No. 127 of 2016, they are being taken up together for disposal.

The appeal (FAO No. 141 of 2023) is maintained by the appellant/United India Insurance Company Limited (hereinafter referred to as “the Insurance Company”), under Section 173 of the Motor Vehicles Act, 1988 (for short “the Act”), against award dated 01.05.2023, passed by the learned Tribunal Below, in a claim petition filed by the petitioner/claimants (hereinafter referred to as “the claimants”) under Section 166 of the Act, which was allowed and the claimants were held entitled for compensation of Rs.16,64,200/-, with a prayer to exonerate the appellant-Insurance Company from the liability to bear the amount of compensation, interest etc. by quashing and setting aside the impugned award.

Appeals, i.e., FAO No. 166 of 2023 and FAO No. 277 of 2023, have been filed by Shah Nawaj and Dalip Kumar (since deceased through LRs), who were driver and owner of the offending vehicle, i.e., HP50-0642, respectively, under Section 173 of the Act, with a prayer to quash and set-aside the impugned award to the extent of recovery of the compensation amount from them.

Succinctly, the facts giving rise to the present appeal are that the claimants/petitioners maintained a petition under Section 166 of the Act seeking compensation on account of death of Shri Om Prakash (deceased), being his legal representatives. As per the claimants, the deceased died in a motor vehicle accident, which took place on 11.06.2016, at around 10:30 a.m. It has been averred in the claim petition by the claimants that when the deceased was going on foot near Satluj Cafe at Khopari, he was hit by Auto Rickshaw, bearing No. HP-50-0642, which was being driven by Shah Nawaj (appellant in FAO No. 166 of 2023), and he sustained multiple head injuries, as a result of which he died at PGI, Chandigarh, while he was under treatment. As per the claimants, the accident occurred due to the rash and negligent driving of the driver of the offending vehicle, as he was driving the vehicle on wrong side of the road that too in a rash and negligent manner. It was further averred that the deceased was self-employed, as a Private Contractor of RCC buildings etc. and he also used to manage the entire domestic affairs of the family. He was the only bread winner of the family and the entire family was dependent upon him. As per the claimants, the deceased was earning Rs.40,000/50,000.00 per month from contractor ship and Rs.1,00,000/- per annum from agricultural and horticulture.

The owner of the offending vehicle, i.e. late Shri Dalip Kumar, who was respondent No. 1 before the learned Tribunal below, by filing reply to the petition, contested the petition, wherein he averred that there was no fault of respondent No. 2-Shah Nawaj @ Kaku (driver of the offending vehicle), as there was a stationary vehicle on the road side. The deceased tried to cross the road immediately and while crossing the road, the deceased was rashly walking and due to sudden and immediate appearance of the deceased, the accident took place. As per the replying respondent, respondent No. 2 was driving the vehicle carefully and with caution.

The driver of the offending vehicle, Shah Nawaj Alias Kaku, who was respondent No. 2 before the learned Tribunal below, contested the claim petition by filing his separate reply, wherein it was averred that there was no fault of him as there was a stationary vehicle on the side of the road. The deceased tried to cross the road immediately and while crossing the road, he was stepping rashly and due to the sudden and immediate appearance of the deceased behind the stationary vehicle, the accident took place. He further averred that he was driving his vehicle with due care and caution.

The appellant, insurance company who was respondent No. 3 before the learned Tribunal below, also filed its separate reply, wherein preliminary objections qua maintainability, that the insured was not possessing a valid registration-cum-fitness certificate, route permit, token tax, passenger tax, that the driver was not possessing a valid and effective driving license at the time of the accident, that the petition was filed in collusion with respondents No.1 & 2 were taken. On merits, it was averred that vehicle No. HP-50-0642 was not insured with respondent No. 3-Insurance Company at the time of the accident. It was further averred that the amount of compensation, as claimed by the petitioners-claimants, was highly exaggerated. Lastly, dismissal of the claim petition was prayed.

The petitioners-claimants filed rejoinder to the replies, wherein the stand taken by the respondents was denied and the averments made in the claim petition were reasserted.

On the basis of the pleadings of the parties, following issues were framed on 08.03.2019:

“1. Whether Sh. Om Prakash had died on 11.06.2016 due to rash and negligent driving of Rickshaw bearing registration No. HP-50-0642 driven by respondent No. 2 at place Khopri near Satluj View Cafe, Rampur Bushahr? OPP

Whether the petitioners are entitled to compensation as claimed, if so to what amount and from whom? OPP

Whether respondent No. 2 was not driving the vehicle at the time of the accident and the accident had occurred on account of negligent act of the deceased? OPR-2

Whether the petition is not maintainable? OPR-3

Whether the vehicle was used in violation of terms and conditions of the insurance policy and without effective driving license? OPR-3

Relief.”

After hearing the learned counsel for the parties, the claim petition was allowed and the claimants were awarded compensation of Rs.16,64,200/- alongwith interest @ 7% per annum from the date of filing of the petition till realization of the entire amount and it was held that the amount of the compensation shall be paid at the first instance by the insurance company, who may recover the same from the owner and driver. Feeling dissatisfied, the insurance company filed appeal, i.e., FAO No. 141 of 2023, seeking quashing and setting-aside of the impugned award and the owner as well as the driver of the vehicle have also filed appeals, i.e., FAO No. 277 of 2023 and FAO No. 166 of 2023, respectively, for modification of the impugned award to the extent of recovery of compensation amount from them by setting aside the findings of the learned Tribunal below to that extent.

The learned counsel for the appellant-Insurance Company contended that the impugned award passed by the learned Tribunal below is legally unsustainable as once the tribunal had held that the driver of the vehicle in question was not having a valid and effective driving license at the time of the accident, it could not have incurred liability on the Insurance Company to initially pay the compensation amount to the claimants and thereafter to get the same recovered from the owner and driver and such finding deserves to be modified and the entire liability deserves to be fastened upon the owner and driver of the vehicle in question. He further contended that while passing the impugned award, the learned Tribunal below had committed a grave error in calculating the future prospects of the deceased and in allowing the parental and filial consortium to the claimants.

On the other hand, the learned Senior counsel for the owner and learned counsel for the driver of vehicle in question contended that the Tribunal below had erred in holding that the driver of the vehicle in question was not holding a valid and effective driving license as the insurance company has miserably failed to prove that the driver of the vehicle in question was not having a valid and effective driving license at the time of the accident.

I have heard learned counsel for the Insurance Company, learned counsel for the claimants, learned Senior Counsel for the LRs of the owner & learned counsel for the driver of the vehicle in question and meticulously examined the entire records.

It is not in dispute that on 11.06.2016, at about 10:30 a.m., near Sutlej Cafe at place Khopari, the deceased-Om Prakash died in an accident that had occurred due to the rash and negligent driving of respondent No. 2- Shah Nawaj @ Kaku, while driving Auto Rickshaw, bearing registration No. HP-50-0642, which was owned by respondent No. 1-Shri Dalip Kumar (since deceased)

Now, the first question which arises for consideration is as to whether the driver of the vehicle in question, Shah Nawaj, was not having a valid and effective driving license at the time of the accident. The appellant-Insurance Company had examined RW-1, Shri Jasvinder Singh, Clerk from the office of Regional Transport Authority (RTA) Jallandhar, Punjab, who had brought the record pertaining to license No. 15810 for the year 2010-11, dated 04.08.2010. While appearing in the witness-box as RW-1, he deposed that the aforesaid license was issued by RTA, Jallandhar, Punjab, in favour of one Nipun Sharma and not in the name of the driver of the vehicle in question, i.e., Shah Nawaj. However, in cross-examination, this witness has clearly stated that the register, which was brought by him did not bear the stamp of the office of RTA, Jalandhar and he further admitted that there was no proof to show that the aforesaid register was of the office of RTA, Jallandhar. He further admitted that there was no paging in the aforesaid register.

Section 26 of the Act provides that the State Government shall maintain a register with respect to the driving license issued and renewed by the Licencing Authorities of the State Government containing the names and addresses of the holders of the driving licenses, license numbers, date of issue or renewal of licenses, date of expiry of the licenses, classes and types of vehicles authorized to be driven and such other particulars as the Central Government may prescribe. At this stage, it would be relevant to reproduce Section 26 of the Act, which provides for the maintenance of the register of driving licenses by the State Government, which is reproduced hereunder:

“26. Maintenance of State Registers of Driving Licences.

(1) Each State Government shall maintain, in such form as may be prescribed by the Central Government, a register to be known as the State Register of Driving Licences, in respect of driving licences issued and renewed by the licensing authorities of the State Government, containing the following particulars, namely:—

(a) names and addresses of holders of driving licences;

(b) licence numbers;

(c) dates of issue or renewal of licences;

(d) dates of expiry of licences;

(e) classes and types of vehicles authorised to be driven; and

(f) such other particulars as the Central Government may prescribe.

(2) Each State Government shall supply to the Central Government a 1 [printed copy or copy in such other form as the Central Government may require] of the State Register of Driving Licences and shall inform the Central Government without delay of all additions to and other amendments in such register made from time to time.

(3) The State Register of Driving Licences shall be maintained in such manner as may be prescribed by the State Government.”

In the case on hand, the perusal of the cross-examination of RW-1, Clerk from the office of RTA, Jalandhar, Punjab, shows that the register which he had brought before the learned Tribunal below was not maintained in accordance with the provisions of Section 26 of the Act, as he admitted in his cross-examination that the register did not bear the stamp of the office of the RTA, Jalandhar. He further admitted that there was no proof to show that the aforesaid register was of the office of RTA, Jalandhar and that there was no paging in the register. Therefore, no authenticity can be attached to the register/record which was summoned by the appellant-Insurance Company in order to prove that the driver of the vehicle in question was not having a valid and effective driving license. In the absence of there being any genuine register, the learned Tribunal below had mis-construed and mis-interpreted the statement of RW-1 in order to arrive at a conclusion that the driver of the vehicle in question was not holding a valid and effective driving license.

In Pepsu Road Transport Corporation vs. National Insurance Company (2013) 10 SCC 217 which too dealt with genuineness of the driving license, the Hon’ble Supreme Court had noted that even after perusing the evidence tendered by the Licensing Authority, it could not be conclusively ascertained whether the driving license was genuine or not; the Register maintained for issuing the driving licenses showed certain entries of 1985; the license concerned bore a number that was not included in the Register. The evidence also stated that it was possible that the other license Registers maintained in the year 1985, which were not readily available, may have contained the details of the license concerned. The relevant paras of the aforesaid judgment reads as under:

“4. The other contention on merits is that the insurer had not established before the Tribunal that the licence issued to Nirmal Singh was fake. In this context, our reference has been invited to Annexure-2-evidence of the licensing authority before the Tribunal. It is stated that as per the available office records, no driving licence was issued to Nirmal Singh on 12.06.1985 with no.12385 of 1985. Licence numbers of 1985 as per record start from 22579 of 1985. Photocopy of the register maintained for issuing the licences was marked as R-1. However, it was also stated that: -

“…It can be possible that other licence register pertaining to year 1985 are not available today as it might be misplaced during the shifting of our office…” Still further, it was stated:

“… It is possible that the registers which are misplaced might contain the name of Nirmal Singh.”

… … … … … … … …

On facts, in the instant case, the appellant employer had employed the third respondent Nirmal Singh as driver in 1994. In the process of employment, he had been put to a driving test and he had been imparted training also. The accident took place only after six years of his service in PRTC as driver. In such circumstances, it cannot be said that the insured is at fault in having employed a person whose licence has been proved to be fake by the insurance company before the Tribunal. As we have already noted above, on scanning the evidence of the licensing authority before the Tribunal, it cannot also be absolutely held that the licence to the driver had not been issued by the said authority and that the licence was fake. Though the appellant had also taken a contention that the compensation is on the higher side, no serious attempt has been made and according to us justifiably, to canvas that position.”

In the case on hand also, in view of the cross examination of RW-1, Clerk from the office of RTA, Jallandhar, no reliance can be placed upon the register that was summoned by the appellant-Insurance Company. There is no denial of the fact that the evidence means legally admissible evidence, which in the present case is conspicuously absent. Needless to state that it is for the Insurance Company to prove that the owner had committed breach of the insurance policy and that the driver was not holding a valid and effective driving license. However, the insurance company has miserably failed to prove that the driver of the vehicle in question was not having a valid and effective driving license at the time of the accident.

Hence, in view of the entire evidence on record, the findings recorded by the learned Tribunal below with respect to the driving license, being fake, are unsustainable in the eyes of law. Once the appellant-Insurance Company has failed to prove that the driving license of the driver of the vehicle in question was invalid, then the findings recorded by the learned Tribunal below to this effect deserve to be quashed and set-aside. Since the vehicle in question was duly insured with the appellant-Insurance Company, the Insurance Company shall be liable to pay the amount of compensation to the claimants.

The learned counsel for the appellant-Insurance Company next contended that while computing the income of the deceased, the learned Tribunal below had committed an illegality in calculating the future prospects of the deceased and in allowing parental and filial consortium to the claimants. Admittedly, at the time of the accident, the age of the deceased was 42 years. In the Pariwar register, Ex. PW-1/E, the date of birth of the deceased has been recorded as 20.02.1974. The accident took place on 11.06.2016, thus the deceased was about 42 years of age at the time of the accident.

The perusal of the award shows that the learned Tribunal below had added 30% of the actual income of the deceased towards future prospects. In National Insurance Company Limited vs. Pranay Sethi & others, (2017) 16 SCC 680, a Constitution Bench of the Hon’ble Apex Court held that while determining the income, in case the deceased was self-employed or on a fixed salary and between 40 to 50 years of age, an addition of 25 % of the established income to the income of the deceased towards future prospects should be made. Paras 59.3 and 59.4 of the said judgment read as follows:-

“59.3. While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax.

59.4 In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component.”

In the instant case, as observed earlier, at the time of accident, the deceased was about 42 years of age and was self employed. Therefore, in view of the law laid down by the Apex Court in Pranay Sethi’s case (supra), an addition of 25% of the monthly income of the deceased has to be made towards future prospects instead of 30%, as added wrongly by the learned Tribunal below.

Thus, after fixing the notional monthly income of the deceased at Rs.9,000/- and adding 25% of the monthly income towards future prospects, the amount comes to Rs.11,250/-(9,000+2,250 =11,250).

In Sarla Verma & others vs. Delhi Transport Corporation and another, (2009) 6 SCC 121, the Apex Court, on the question of deduction towards the personal and living expenses of the deceased held that, the personal and living expenses of the deceased should be deducted from his monthly income, to arrive at the contribution to the dependents. Where the deceased was married, the deduction towards personal and living expenses of the deceased should be one-third where the number of dependent family members is 2 to 3; one-fourth where the number of dependent family members is 4 to 6; and one-fifth where the number of dependent family members exceeds 6. In regard to bachelors, normally, 50% is deducted as personal and living expenses, because it is assumed that a bachelor would tend to spend more on himself.

Since there were four dependents upon the income of the deceased, 1/4th of his income is required to be deducted towards personal and living expenses. After the said deduction, the contribution to family comes out to Rs.8,438/- per month.

In Sarla Verma’s case (supra), it has further been held by the Hon’ble Supreme Court that the multiplier to be used should be as mentioned in column (4) of the Table above (prepared by applying Susamma Thomas, Trilok Chandra and Charlie), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years. The relevant portion of the aforesaid judgment is as under:-

‘42. We therefore hold that the multiplier to be used should be as mentioned in column (4) of the Table above (prepared by applying Susamma Thomas, Trilok Chandra and Charlie), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years.”

Thus, by applying the multiplier of ‘14’ as per the settled law, the compensation under the head, loss of dependency is re-fixed as Rs.8,438/- x 12 x 14 = Rs.14,17,584/-.

Now coming to the last aspect, i.e., the conventional heads. The ld. Counsel for the insurance company contended that while passing the impugned award, the learned Tribunal below had committed a grave error in allowing the parental and filial consortium to the claimants. In the impugned award, the Tribunal awarded a sum of Rs.40,000/- towards spousal consortium, Rs.15,000/- as filial consortium and Rs.80,000/-towards parental consortium. The amount under the conventional heads has been standardized by the Hon’ble Apex Court at Rs.15,000/- for loss of estate; Rs.40,000/- towards loss of ‘filial consortium' and Rs.15,000/- towards funeral expenses. In Magma General Insurance Company Limited Vs. Nanu Ram alias Chuhru Ram and others, reported in (2018) 18 Supreme Court Cases 130, the Hon’ble Supreme Court has held that in legal parlance, “consortium” is a compendious term which encompasses “spousal consortium”, “parental consortium”, and “filial consortium”. Relevant paras of the same read as under:-

“21. A Constitution Bench of this Court in Pranay Sethi dealt with the various heads under which compensation is to be awarded in a death case. One of these heads is loss of consortium. In legal parlance, “consortium” is a compendious term which encompasses “spousal consortium”, “parental consortium”, and “filial consortium”. The right to consortium would include the company, care, help comfort, guidance, solace and affection of the deceased, which is a loss to his family. With respect to a spouse, it would include sexual relations with the deceased spouse:

21.1. Spousal consortium is general defined as rights  pertaining to the relationship  of a husband-wife which allows compensation o the surviving spouse for loss of “company, society, cooperation, affection, and aid of the other in every conjugal relation”.

21.2. Parental consortium is granted to the child upon the premature death of a parent, for loss of “parental aid, protection, affection, society, discipline, guidance and taining”.

21.3. Filial consortium is the right of the parents  to  compensation  in  the  case  of  an accidental death of a child. An accident leading to the death of a child causes great shock and agony to the parents and family of the deceased. The greatest agony for a parent is to lose their child during their lifetime. Children are valued for their love affection, companionship and their role in the family unit.

Consortium is a special prism reflecting changing norms about the status and worth of actual relationships. Modern jurisdictions world-over have recognized that the value of a child’s consortium far exceeds the economic value of the compensation awarded in the case of the death of a child. Most jurisdictions therefore permit parents to be awarded compensation under loss of consortium on the death of a child. The amount awarded to the parents is a compensation for loss of love, affection, care and companionship of the deceased child.”

Since “consortium” is a compendious term which encompasses “spousal consortium”, “parental consortium”, and “filial consortium” as held by the Hon’ble Supreme Court in Magma’s case (supra), the learned Tribunal below had not committed any error in allowing the parental and filial consortium to the claimants 2 to 4. Accordingly, by re-fixing the amount under the head, loss of dependency” at Rs.14,17,584/-,the total amount of compensation is worked out as under:-

Head Amount

(i) Loss of dependency                     Rs.14,17,584/-

(ii) Funeral expenses                       Rs.15,000/-

(iii) Loss of estate                             Rs.15,000/-

(iv) Spousal consortium                  Rs.40,000/- (payable to petitioner No. 1)

(v) Parental consortium                  Rs.80,000/- (Rs.40,000/- each payable to petitioners No. 2 and 3)

(vi) Filial consortium                      Rs.40,000/-(payable to petitioner No.4)

Total compensation awarded Rs.16,07,584/-

This Court, however, does not see any reason to interfere with the rate of interest awarded on the amount of compensation.

Consequently, in view of detailed discussion made here-in-above and the law laid down by the Hon'ble Apex Court, the appeals filed by the owner and driver of the vehicle in question, i.e., FA0 No. 277 and 166 of 2023, respectively, are allowed and the appeal filed by the appellant-Insurance Company, i.e., FAO No. 141 of 2023, is partly allowed. The impugned award stands modified and the petitioners-claimants are held entitled for compensation in the sum of Rs.16,07,584/-alongwith interest @ 7% per annum from the date of filing of the petition till realization of the entire amount of compensation. The owner of the vehicle in question, is held liable to pay the amount of compensation and consequently, the appellant-insurance company will indemnify the owner of the vehicle towards the compensation payable to the claimants since the vehicle in question was duly insured at the time of accident. The remaining terms of the impugned award, shall remain the same. The appeals stand disposed of in the above terms, so also the pending applications, if any.