Research › Search › Judgment

Gauhati High Court · body

2005 DIGILAW 588 (GAU)

New India Assurance Co. Ltd. v. Murise Sangtem

2005-08-11

I.A.ANSARI

body2005
JUDGMENT I.A. Ansari, J. 1. This appeal under Section 173 of the Motor Vehicles Act, 1988 (in short the M.V. Act), has arisen out of the award, dated 30.3.2004, passed by the learned Member, MACT, Dimapur, in M.A.C. Case No. 60 of 2003, directing the present insurer-Appellant to pay Rs. 1,84,500/- as compensation to the claimant-Respondent within 30 days from the date of the award failing which interest at the rate of 9% per annum would accrue on the awarded amount until full payment is made. 2. I have heard Mr. Imti Imsong, learned Counsel for the Appellant, and Mrs. Aphien, learned Counsel appearing on behalf of the claimant-Respondent No. 1. 3. The material facts, which have led to the present appeal, maybe set out as follows: (i) The claimant-Respondent No. 1 instituted the M.A.C. Case No. 60 of 2003 aforementioned under Section 166 of the M.V. Act claiming compensation on the ground of the death of her deceased son, namely, Athrise Sangtam, in a motor vehicular accident, which took place on 14.2.2003, the claim having been made against the owner of an auto-rickshaw bearing registration No. NL-01/T/7240, which stood insured with the present Appellant at the relevant point of time. The case of the claimant, in brief, was that her said deceased son was a bonafide passenger and while travelling in the said auto-rickshaw, on 14.02.2003, from Dimapur towards his village, the said auto-rickshaw met with an accident at about 6.20 p.m., the said deceased sustained grievous injuries and succumbed to death. (ii) The owner and driver of the said auto-rickshaw did not appear in the said claim proceeding and did not contest the same. The Appellant, as insurer of the said vehicle, appeared and, initially, contested the said proceeding with limited right available to it as insurer under Section 149 of the M.V. Act. But as the owner of the said auto-rickshaw did not contest the said proceeding, the Appellant made, on 05.02.2005, an application under Section 170 of the M.V. Act seeking to contest the proceeding on all the grounds, which were available to the owner of the said auto-rickshaw. However, no order was passed on this application by the learned Tribunal. (iii) The case of the Appellant, as projected before the learned Tribunal, was, briefly stated, thus. However, no order was passed on this application by the learned Tribunal. (iii) The case of the Appellant, as projected before the learned Tribunal, was, briefly stated, thus. On 14.2.2003, while the auto-rickshaw was being driven, another vehicle (Jeep) bearing registration No. NL-01/8164 dashed against the said auto-rickshaw due to reckless and negligent driving of the driver of the Jeep and as a result of the said collision, the claimant's said son sustained injuries and succumbed to his injuries. Hence, there being no fault on the part of the driver of the auto-rickshaw, the insurer-Appellant of the auto-rickshaw was not liable to pay any compensation. 4. The learned Tribunal framed the following issues: Issue No. 1. Whether the accident occurred on 14.2.2003 leading to the death of the deceased? Issue No. 2. Whether the vehicle was having requisite valid documents at the time of accident? Issue No. 3. Whether there is any breach of any policy terms and conditions? Issue No. 4. Whether the claimants are entitled to compensation? If so to that extent and payable by whom? 5. The learned Tribunal answered the issues framed by it in favour of the claimant and awarded, as compensation, an amount of Rs. 1,84,500/- as mentioned hereinbefore. 6. While considering the present appeal, it is of paramount importance to note that the claimant instituted a proceeding under Section 166 of the M.V. Act. For sustaining a claim under Section 166of the M.V. Act, the claimant has to establish that the accident, in question, took place due to rash and negligent driving of the vehicle, whose owner and insurer is liable to pay the compensation, for, an application for compensation under Section 166 is, basically, an application for compensation against tortuous liability of the owner. For establishing tortuous liability, negligence on the part of the owner of the vehicle, in question, must be established unless the law enacted, in this regard, provides otherwise. By incorporating provisions, such as, Sections 140 and 163-A, the Legislature has absolved a claimant from proving, if he chooses, fault on the part of the driver of the vehicle or any rashness or negligence in the use of the vehicle at a public place. 7. By incorporating provisions, such as, Sections 140 and 163-A, the Legislature has absolved a claimant from proving, if he chooses, fault on the part of the driver of the vehicle or any rashness or negligence in the use of the vehicle at a public place. 7. As against the proof of the fault, which the nature of a claim proceeding initiated under Section166 demands, when a claim under Section 163-A is made, the claimant need not prove fault on the part of the driver of the vehicle. This is the basic difference between an application made under Section 166 and an application filed under Section 163-A. This apart, the" application under Section140, which relates to the realization of a fixed amount of money as compensation without proof of fault cart be resorted to, as an interim arrangement, when an application for compensation is made under Section 166 and not when an application is made under Section 163-A of the M.V. Act, for, the amount paid under Section 140 merges with the award finally given by a Tribunal under Section 168of the M.V. Act arising out of an application made under Section 166 thereof. This is clear from the provisions of Section 163-B, which lays down, in no uncertain words, that where a person is entitled to claim compensation under Sections 140 and 163-A, it shall file claim under either of the said Section and not under both. 8. Dealing with the above aspect of the matter, this Court in Bina Prasad Sonari v. Manager, United India Insurance Co. Ltd. and other reported in 2005 (25) AIC 849 (Gau), observed and held as follows: An application for compensation can be made either under Section 166 or under Section 163-A of the said Act. If the application is under Section 163-A, the question of proving the negligence on the part of the driver of the offending vehicle does not arise at all; rather, in a case, wherein compensation is claimed under Section 163-A, on proof of the accident, age of the deceased, the income of the deceased and the relationship of the claimant with the deceased, the structured formulae, contained in the Second Schedule framed under Section 163-A, would be applied. However, when the claim application is made (as is the case at hand) under Section 166, the claimant has to prove negligence on the part of driver of the offending vehicle and only on such a proof being made available to the Tribunal, the Tribunal can determine the amount payable to the claimant as compensation and for determining the amount of compensation, the structured formulae may be used as the guide. For applications made under Section 166, the provisions for payment of no-fault liability amount has been made under Section 140 of the said Act. Section 140 is, thus, applicable only if the compensation is claimed under Section 166. That no-fault liability amount cannot be made available to an applicant under Section 163-A is clear from the provisions of Section 163-Binasmuch as Section 163-B gives every claimant the option to either make an application under Section 140 for no-fault liability amount pending determination of the compensation claimed under Section 166 or lodge a claim for determination of compensation, as a whole, under Section 163-A, by using the structured formulae contained in the Second Schedule. Thus, the question of applying for payment of no-fault liability amount under Section 140 does not arise at all if the claim application is under Section 163-A. 9. I may pause here to point out that no provision, such as, the one that have now, in the form of Section 163-A, existed in the Motor Vehicles Act, 1939, which preceded the enactment of the Motor Vehicles Act, 1988. Such a provision did not also exist in the Motor Vehicles Act, 1988, when this Act came into force. As a matter of fact, Section 163-A has been introduced by the Amendment Act No. 54 of 1994 with effect from 14.11.1994 as against the fixed minimum interim compensation awardable under Section 140 of the M.V. Act on the principle of no-fault, which merges in the final award to be made on the basis of 'fault liability' in accordance with Section 141. Section 163-A allows a victim of a motor vehicular accident to obtain a final award of compensation based on the structured formula contained in the 2nd Schedule to the Act and such compensation maybe obtained without the claimant being required to plead or establish that the injuries sustained or death caused was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other persons. The compensation finally payable under Section 163-A is materially different from the minimum prescribed compensation payable under Section 140, though both these provisions dispense with the proof of negligence on the part of the owner of the vehicle or vehicles concerned or of any other persons. In short, proof of negligence is not necessary for availing compensation either under Section 140 or 163-A. 10. The present M.V. Act provides an option to the claimant to obtain interim compensation under Section 140 being the minimum prescribed compensation until final adjudication of his claim, under Section 166, leading to the delivery of the award in which would get merged the interim compensation, if any, already received by the claimant under Section 140. The other course, which the claimant can opt for, is to obtain a final award of compensation on the basis of structured formula as depicted in the 2nd Schedule under Section 163-A. The provisions embodied in Section166 as well as under Section 163-A have both advantages as well as disadvantages appended thereto. For instance, while Section 166 requires proof of fault as a condition precedent for granting of compensation, there is no ceiling in the amount of compensation, which can be granted under Section 166, and, further, Section 166 can be resorted to irrespective of the income of the persons, who has sustained injuries or met with death. As against this, while Section 163-A dispenses with the proof of fault, this Section (i.e., Section 163-A) can be resorted to only when the annual income of the deceased does not exceed Rs. 40,000/-. Similarly, while in Section 166, as already indicated hereinbefore, there is no limit to which expenses for treatment incurred by the injured can be awarded, the total medical expenses to be awarded cannot, in a proceeding under Section 163-A, exceed Rs. 15,000/-. There are several other such limitations if one takes recourse to Section 163-Afor obtaining compensation. 40,000/-. Similarly, while in Section 166, as already indicated hereinbefore, there is no limit to which expenses for treatment incurred by the injured can be awarded, the total medical expenses to be awarded cannot, in a proceeding under Section 163-A, exceed Rs. 15,000/-. There are several other such limitations if one takes recourse to Section 163-Afor obtaining compensation. For instance, the loss of consortium under Section 163-A is limited to Rs. 5000/- whereas, in the light of the decision in Lata Wadhwa and other v. State of Bihar and other reported in (2001) 8 SCC 197 , the consortium can be, in an appropriate case, as high as Rs. 50,000/-. Yet another advantage of taking recourse to Section 163-A is that it reduces the delay, which, ordinarily, occurs due to the fact that the claimant is required to prove fault. Noticing some of these prominently distinguishing features of Section 163-A, the Apex Court in Deepal Girishbhai Soni and other v. United India Insurance Co. Ltd. reported in 2004 (5) SCC 385 , observed as follows: Section 140 of the Act dealt with interim compensation but by inserting Section 163-A, the Parliament intended to provide for making of an award consisting of a pre-determined sum without insisting on a long-drawn trial or without proof of negligence in causing the accident. The amendment was, thus, a deviation from the common law liability under the Law of Torts and was also in derogation of the provisions of the Fatal Accidents Act. The Act and the Rules framed by the State in no uncertain terms suggest that a new device was sought to be evolved so as to grant a quick and efficacious relief to the victims falling within the specified category. The heirs of the deceased or the victims in terms of the said provisions were assured of a speedy and effective remedy which was not available to the claimants under Section 166 of the Act. Chapter XI was, thus, enacted for grant of immediate relief to section of people whose annual income is not more than Rs. 40,000/- having regard to the fact that in terms of Section 163-A of the Act read with the Second Schedule appended thereto; compensation is to be paid on a structured formula not only having regard to the age of the victim and his income but also the other factors relevant therefor. 40,000/- having regard to the fact that in terms of Section 163-A of the Act read with the Second Schedule appended thereto; compensation is to be paid on a structured formula not only having regard to the age of the victim and his income but also the other factors relevant therefor. An award made thereunder, therefore, shall be in full and final settlement of the claim as would appear from the different columns contained in the Second Schedule appended to the Act. The same is not interim in nature. Payment of the amount in terms of Section 140 of the Act is ad hoc in nature. A claim made thereunder, as has been noticed hereinbefore, is in addition to any other claim which may be made under any other law for the time being in force. Section 163-A of the Act does not contain any such provision. If no amount is payable under the fault liability or the compensation which may be received from any other law, no refund of the amount received by the claimant under Section 140 is postulated in the Scheme. Section 163-A, on the other hand, nowhere provides that the payment of compensation of no-fault liability in terms of the structured formula is in addition to the liability to pay compensation in accordance with the right to get compensation on the principle of fault liability. 11. That one is required to prove fault to become entitled to receive compensation under Section166 and that the recourse to Section 140 can be had as an interim arrangement subject to final determination can be easily discerned from the observations made in Deepal Girishbhai Soni (supra), which runs as follows: The scheme envisaged under Section 163-A, in our opinion, leaves no manner of doubt that by reason thereof the rights and obligations of the parties are to be determined finally. The amount of compensation payable under the aforementioned provisions is not to be altered or varied in any other proceedings. It does not contain any provision providing for set off against a higher compensation unlike Section 140; In terms of the said provision, a distinct and specified class of citizens, namely, persons whose income per annum is Rs. 40,000/- or less is covered thereunder; whereas Sections 140and 166 cater to all sections of society. It does not contain any provision providing for set off against a higher compensation unlike Section 140; In terms of the said provision, a distinct and specified class of citizens, namely, persons whose income per annum is Rs. 40,000/- or less is covered thereunder; whereas Sections 140and 166 cater to all sections of society. It may be true that Section 163-A provides for an option to a claimant to either go for a claim under Section 140 or Section 163-A of the Act, as the case may be, but the same was inserted 'ex-abundanti cautela' so as to remove any misconception in the mind of the parties to the lis having regard to the fact that both relate to the claim on the basis of no-fault liability. Having regard to the fact that Section 166 of the Act provides for a complete machinery for laying a claim on fault liability, the question of giving an option to the claimant to pursue their claims either under Section 163-A or Section 166 does not arise. If the submission of the learned Counsel is accepted the same would lead to an incongruity. 12. From what have been pointed out above, it becomes abundantly clear that the present M.V. Act lays down two comprehensive and independent, but complete in itself, mechanism for receiving compensation for injuries sustained or death caused in motor vehicular accidents. Both the schemes for compensation, one conceived under Section 166 and the other perceived by Section 163-A, are mutually exclusive and independent of each other and it is for a person, who wants to claim compensation, to decide as to which procedure or mechanism he or she would opt for. 13. Both the schemes for compensation, one conceived under Section 166 and the other perceived by Section 163-A, are mutually exclusive and independent of each other and it is for a person, who wants to claim compensation, to decide as to which procedure or mechanism he or she would opt for. 13. In the face of clearly laid down schemes for obtaining compensation under the two sections, namely, Section 166 and Section 163-A and when it is left with the claimant to choose the course of action, no one can maintain a claim both under Section 166 as well as Section 163-A. The M.V. Act also does not conceive of a situation, when based on an application made under Section 166, the Tribunal, on its own, on the failure of the claimant to prove fault, can award compensation by taking recourse to Section 163-A. When a claimant makes an application for compensation under Section166 and also receives interim compensation under Section 140, he shall, so long as his application for compensation remains pending under Section 166, prove, as a condition precedent for succeeding in obtaining compensation under Section 166 that the accident took place due to fault or negligent or default of the owner or owners of the vehicle or vehicles concerned or of any other persons. 14. The above aspect of law has been succinctly explained by the Apex Court in Deepal Girishbhai Soni (supra), in the following words: The question may be considered from different angles. As for example, if in the proceedings under Section 166 of the Act, after obtaining compensation under Section 163-A, the awardee fails to prove that the accident took place owing to negligence on the part of the driver or if it is found as of fact that the deceased or the victim himself was responsible therefore as a consequence whereto the Tribunal refuses to grant any compensation; would it be within its jurisdiction to direct refund either in whole or in part the amount of compensation already paid on the basis of structured formula? Furthermore, if in a case the Tribunal upon considering the relevant materials comes to the conclusion that no case has been made out for awarding the compensation under Section 166 of the Act, would it be at liberty to award compensation in terms of Section 163-A thereof. Furthermore, if in a case the Tribunal upon considering the relevant materials comes to the conclusion that no case has been made out for awarding the compensation under Section 166 of the Act, would it be at liberty to award compensation in terms of Section 163-A thereof. The answer to both the aforementioned questions must be rendered in the negative. In other words, the question of adjustment or refund will invariably arise in the event if it is held that the amount of compensation paid in the proceedings under Section 163-A of the Act is interim in nature. 15. Embedded, thus, in the scheme of Section 166 is the requirement for the Tribunal to frame an issue or for the claimant to, at least, bring on record materials as regards fault or neglect or default, as indicated hereinbefore, in order to sustain his claim under Section 166. If in a proceeding under Section 166, the claimant obtains interim compensation under Section 140, but adduces no evidence to prove fault or negligence or default, his application under Section 166 cannot succeed and the Tribunal cannot award compensation on the basis of the structured formula by taking recourse to Section 163-A, for, it is for the claimant really to decide which course of action he or she shall opt for. Whether it is, on the basis of the application for amendment made by the claimant, permissible to amend a proceeding under Section 166, to one under Section 163-A is a question, which has not arisen in the present appeal and I am not inclined to make any comment on this aspect of the matter. 16. In the case at hand, the claimant made an application under Section 140 of the M.V. Act and also received from the Appellant an amount of Rs. 50,000/- as no fault liability amount. 17. In other words, in the face of what has been pointed out hereinabove, there can be no escape from conclusion that the claimant could not have succeeded in obtaining compensation without proving fault on the part of the driver of the auto-rickshaw and thereby making the owner of the auto-rickshaw vicariously liable for the tortuous act of the driver of the said vehicle. Amazingly enough, however, the learned Tribunal framed no issue on the question as to whether the said accident took place as a result of rash and negligent driving of the said auto-rickshaw. No wonder, therefore, that the claimant also did not adduce any evidence to show that there was any rashness or negligence on the part of the driver or owner of the said vehicle. 18. Coupled with the above, when the owner of the said auto-rickshaw had not contested the claim of the claimant, insurer of the said auto-rickshaw i.e., the present Appellant's application made under Section 170, as indicated hereinabove, for permission to contest the claim on all the grounds, which were available to the owner of the auto-rickshaw, ought to have been allowed by the learned Tribunal. The learned Tribunal's omission to pass an order on this application or its refusal to exercise the power vested in it under Section 170 is not sustainable, for, if this omission to exercise jurisdiction is not interpreted with, it would, in the facts and circumstances of the present case, cause serious miscarriage of justice. 19. What also cannot be ignored is that the FIR, which forms part of the case record and was available with the learned Tribunal, shows that according to the police, on 14.2.2003, at about 6.20 p.m. the said auto-rickshaw was hit by the Jeep bearing registration No. NL-01/8164 and after causing the said accident, the driver of the Jeep fled away with his Jeep leaving the injured person at the place of accident. When the description of the said accident mentioned in the FIR revealed that two vehicles were involved in the said accident, the owner of the said jeep was a necessary party to the claim proceeding and ought to have been impleaded as a party by the claimant and/or by, at least, the learned Tribunal. In absence of the owner of the said jeep, no just and effective award can be passed, for, the owner and insurer of the said jeep need to be heard before the claim case is effectively disposed of. 20. In absence of the owner of the said jeep, no just and effective award can be passed, for, the owner and insurer of the said jeep need to be heard before the claim case is effectively disposed of. 20. In the facts and circumstances of the present case, particularly, when the owner of the auto-rickshaw did not contest the said proceeding, the learned Tribunal ought to have granted the prayer of the insurer to contest the proceeding on all such grounds, which were available to the owner of the said auto-rickshaw. Because of what has been pointed out, the conclusion reached by the learned Tribunal that the owner of the said auto-rickshaw is liable for making payment of compensation cannot be sustained unless the insurer-Appellant of the auto-rickshaw is permitted to contest the claim effectively in terms of the provisions of Section 170 of the M.V. Act. 21. What crystallizes from the above discussion is that in the case at hand, the claimant, having been made an application under Section 166 and having obtained the interim payment under Section 140, ought to have proved that the said accident took place account of fault or negligence on the part of the driver of the said auto-rickshaw. Having not abandoned the course adopted by the claimant and having not pursued her claim under Section 163-A, she, in the absence of complete evidence on record as regards the fault, was not entitled to the grant of any compensation except what had already been given to her in terms of the provisions of Section 140. 22. Considering, therefore, the matter in its entirety and in the interest of justice, this appeal is partly allowed. The impugned award is hereby set aside and the proceeding is remanded to the learned Member, MACT, Dimapur, with direction to allow the insurer-Appellant to contest the claim proceeding in terms of the provisions of Section 170 of the M.V. Act. The Respondent-claimant shall retain the amount of Rs. 1 lakh, which has already been paid, in all, to her by the insurer-Appellant. The amount, so paid by the insurer-Appellant, shall be subject to the award, which will, eventually, be passed by the learned Tribunal. The Respondent-claimant shall retain the amount of Rs. 1 lakh, which has already been paid, in all, to her by the insurer-Appellant. The amount, so paid by the insurer-Appellant, shall be subject to the award, which will, eventually, be passed by the learned Tribunal. The parties to the proceeding are left at liberty to make petition or petitions for modification/amendment of their pleadings and if such a petition is filed, the learned Tribunal shall consider and dispose of the same in accordance with law. The claimant-Respondent is hereby directed to implead the owner of the said Jeep as a party in the claim proceeding.