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2000 DIGILAW 1109 (PAT)

National Insurance Co. Ltd. v. Madhuri Kuer

2000-09-13

S.K.CHATTOPADHYAYA

body2000
Judgment 1. The Insurance Company has challenged the Award passed by the Accident Claims Tribunal granting compensation to the respondent claimant. 2. One Shiv Shanker, the Driver of the Tractor No. B.R.-24/8408 was moving along Kutchi road by the side of the canal but due to heavy load on the tractor the same suddenly fell in the canal causing fatal injury to the Driver, who subsequently succumbed to the injury. 3. The Tribunal on the basis of evidence on record has concluded that as said Shiv Shanker died in course of employment as Driver, his heirs were entitled to get the compensation. 4. The owner of the tractor admitted that the death of Shiv Shanker was in course of employment and also asserted that he used to pay extra premium to the Insurance Company to cover the risk of the Driver also. 5. The appellant Company, however, in its written statement denied the factum of accident and cause of death but admitted the existence of coverage of policy issued by the Company. It was contended that neither the deceased was the Driver of the tractor nor he had any licence. He was not getting any salary because the deceased Shiv Shanker was the son of the insured himself. It was contended that the tractor was insured only for the purpose of agriculture. As the accident had taken place due to negligence of the deceased Driver and, as such, the claimant cannot take any advantage of it. Besides this defence the appellant company also took the defence available to it under section 149 of the Motor Vehicles Act (hereinafter referred to as the Act). 6. Learned counsel for the appellant submits that the appellant-Company cannot be made liable to pay more than the yearly amount given to the family by the deceased and therefore, the amount of compensation to the tune of Rs. 1,60,000/- will be much higher and the same is contrary to law. According to him the learned Tribunal has failed to appreciate that when Rs. 800/- per month is assessed as loss of dependency, the multiplier 16 as per Second Schedule of the Act should not have been applied. Referring to the decisions in the case of U.P. State Road Transport Corporation and ors. V/s. Trilok Chandra and ors. reported in (1996) 4 Supreme Court Cases 362 and in the case of United India Insurance Co. Referring to the decisions in the case of U.P. State Road Transport Corporation and ors. V/s. Trilok Chandra and ors. reported in (1996) 4 Supreme Court Cases 362 and in the case of United India Insurance Co. Ltd. V/s. Most. Meena Devi & ors., reported in 2000 (2) PLJR 820 learned counsel submits that if Rs. 1,20,000/- is deposited in fixed term in a Nationalised Bank, the interest will fetch more than the amount of loss of dependency of Rs. 800/- per month. 7. Learned counsel for the respondent, however, submits that the Insurance Company cannot question the quantum of compensation awarded by the Tribunal and, as such, this appeal is not maintainable. In support of this she has relied on the decision in the case of Chinnama George and ors. V/s. N.K. Raju and anr. reported in (2000) 4 Supreme Court Cases 130. 8. It is well settled that the claimant in connection with Motor Vehicles Accident should not be defeated on technical ground but even then the Award must be a "Just Award" as contemplated under Section 168 of the Act. The topic of compensation for causing death by negligent driving was the subject matter of several judicial decisions. In the case of U.P. State Road Transport Corporation and ors. (supra) a three Judges Bench of the Supreme Court has considered several decisions to resolve this question by observing as follows : "17. The situation has now undergone a change with the enactment of the Motor Vehicles Act, 1988 , as amended by Amendment Act 54 of 1994. The most important change introduced by the amendment insofar as it relates to determination of compensation is the insertion of Sections 163-A and 163-B in Chapter XI entitled "Insurance of Motor Vehicles against Third Party Risks". Section 165-A begins with a non obstane clause and provides for payment of compensation as indicated in the Second Schedule, to the legal representatives of the deceased or injured, as the case may be. Now if we turn to the Second Schedule, we find a table fixing the mode of calculation of compensation for third party accident injury claims arising out of fatal accidents. The first column gives the age group of the victims of accident, the second column indicates the multiplier and the subsequent horizontal figures indicate the quantum of compensation in thousand payable to the heirs of the deceased victim. The first column gives the age group of the victims of accident, the second column indicates the multiplier and the subsequent horizontal figures indicate the quantum of compensation in thousand payable to the heirs of the deceased victim. According to this table the multiplier varies from 5 to 18 depending on the age group of which the victim belonged. Thus, under this Schedule the maximum multiplier can be up to 18 and not 16 as was held in Susamma Thomas case." Thus, according to their Lordships the amount worked out in the Schedule of the Act suffers from several defects and neither the Tribunal nor the courts can go by the ready reckoner. Coming to this conclusion their Lordships have relied on the decision in the case of Davies V/s. Powell Duffiyn Associated Collieries Ltd.. reported in (1942) All ER 657. Thus the loss has to be estimated by first determining the monthly income of the deceased, then deducting therefrom the amount spent on the deceased, and thus assessing the loss to the dependants of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an appropriate multiplier (emphasis added). After giving an illustration in a given case it is held by their Lordships that after determining the annual loss of dependency the same has to be multiplied by the use of an appropriate multiplier to assess the compensation under the head of loss to the dependants. To this may be added a convential amount by way of loss of expectation of life, which in the present scenario can be raised to a figure of not more than Rs. 10,000/-. Their lordships have also noticed the decision in the case of G.M., Kerala SRTC V/s. Susamma Thomas reported in (1994) 2 SCC 176 in which it has been held that the multiplier represents the number of years purchase on which the loss of dependency is capitalised. In a case where annual loss of dependency is Rs. 10,000/- it is observed that if a sum of Rs. 1,00,000/- is invested at 10% annual interest, the interest will take care of the dependency perpetually. 9 Applying the aforesaid principle laid down by their Lordships if we examine the annual loss of dependency in the instant case it will be Rs. 800 x 12 = Rs. 9,600/- annually. Thus, if Rs. 1,00,000/- is invested at 10% annual interest, the interest will take care of the dependency perpetually. 9 Applying the aforesaid principle laid down by their Lordships if we examine the annual loss of dependency in the instant case it will be Rs. 800 x 12 = Rs. 9,600/- annually. Thus, if Rs. 1,20,000/- is invested at 10% annual interest, in my view, the interest per month received by claimant will meet the loss of monthly dependency. The learned Tribunal, in my view, has failed to consider this aspect of the matter and relying on the Schedule has applied multiplier of 16 without considering the case of Susamma Thomas. This Court recently in the case of United India Insurance Co. Ltd. (supra) has also held the same view. 10. It is true as held in the case of Chinnama George and ors. (supra) that Insurers right of appeal is limited. So far third party risk is concerned, unless any of the conditions contained in section 149(2) exist and such defence is taken in the pleadings and pressed before the Claims Tribunal the insurer is legally bound to satisfy the award made by the Tribunal and it is barred from filing an appeal against such award. 11. In my view the facts and circumstances of the Chinnamas case are different and can be distinguished from the present case. In the instant case admittedly the appellant-Company took all the defence available to it under Section 149(2) of the Act besides taking other defence. In appeal before this Court learned counsel for the appellant has not challenged the quantum of compensation as such but he has challenged the method applied by the Tribunal in coming to the conclusion of the said quantum of compensation. As noticed above, the Tribunal has not considered any of the principles set out by their Lordships of the Supreme Court either in the case of Susamma Thomas (supra) or in the case of U.P. State Road Transport Corporation (supra). 12. In the result, this appeal is allowed in part and the judgment and award under appeal are modified and it is held that the net compensation now payable to the claimant-respondent will be Rs. 1,20,000/-. To this a sum of Rs. 10,000/- is added as conventional amount by way of loss of expectation of life. Thus, the total amount comes to Rs. 1,30,000/- (rupees one lac thirty thousand). 1,20,000/-. To this a sum of Rs. 10,000/- is added as conventional amount by way of loss of expectation of life. Thus, the total amount comes to Rs. 1,30,000/- (rupees one lac thirty thousand). Since out of that amount Rs. 50,000/- (fifty thousand) has already been paid to the claimant under Section 140 of the Act earlier, so the net payable compensation now will be Rs. 80,000/- (rupees eighty thousand). The appellant Insurance Company is directed to pay the claimant respondent the balance amount within a period of two months from today. It is made clear that the compensation will be paid within the aforesaid time alongwith interest at the rate of Rs. 12% per annum from the date of filing of the claim petition till the date of payment. 13. The appeal is, accordingly, allowed in part as indicated above. 14. As fairly submitted by the counsel for the appellant, let the statutory amount deposited by the appellant company in this Court may be released to the claimant-respondent after following the procedure.