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2011 DIGILAW 572 (ORI)

UNITED INDIA INSURANCE CO. LTD. v. LABANYABATI DEV

2011-11-18

V.GOPALA GOWDA

body2011
JUDGMENT : V. Gopala Gowda, J. This appeal is filed by the insurance company. Cross-appeal is also filed by the claimants along with miscellaneous petition seeking for condonation of delay in filing the cross-appeal. The insurance company has filed the appeal, questioning the correctness of the judgment dated 4.9.2004 passed by the Second Motor Accidents Claims Tribunal, Northern Division, Sambalpur in Misc. (A) Case No. 31 of 1999 (S) fastening the liability upon it contending that it is not liable to pay the compensation to the cross-objectors-claimants as the deceased was a gratuitous passenger in the offending vehicle. Therefore, fastening the liability on the insurer awarding compensation of Rs. 3,32,000 with interest at 9 per cent, is not legal and valid, which is liable to be set aside. The cross-objection filed by cross-objectors-claimants, legal representatives of the deceased, was also listed today along with this appeal. Mother of the deceased, respondent No. 1, has died during the pendency of appeal and has been deleted from the cause-title. Legal representatives of the deceased have sought for enhancement of the compensation to the tune of Rs. 5,00,000 by modifying the impugned award applying the law laid down by the Apex Court in the case of Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, AIR 2009 SC 3104 as the compensation awarded is very less and inadequate. 2. The ground of attack of the impugned award by the insurance company is that the insurance policy issued to the offending vehicle is an 'Act only' policy which does not cover the risk to the passengers who are not carried for hire and reward and deceased having travelled as a gratuitous passenger in the car, the learned Tribunal was wrong in saddling the liability on the insurance company. Placing reliance upon the decisions in the case of The General Manager, United Insurance Co. Ltd. Vs. M. Laxmi and Others, AIR 2009 SC 626 , Oriental Insurance Co. Ltd. Vs. Sudhakaran K.V. and Others, AIR 2008 SC 2729 ; and United India Insurance Co. Ltd., Shimla Vs. Tilak Singh and Others, AIR 2006 SC 1576 , it is contended that when the policy does not cover the risk of a gratuitous passenger, the liability fastened upon the insurance company is contrary to the judgment of the Apex Court. Therefore, that portion of the award is liable to be set aside. 3. Ltd., Shimla Vs. Tilak Singh and Others, AIR 2006 SC 1576 , it is contended that when the policy does not cover the risk of a gratuitous passenger, the liability fastened upon the insurance company is contrary to the judgment of the Apex Court. Therefore, that portion of the award is liable to be set aside. 3. The impugned award in fastening the liability upon the insurance company is also liable to be set aside in view of the letter of the R.T.O., Sundergarh, Exh. D, wherein it is reported that the driver of the offending vehicle did not possess a valid and effective licence. Hence there is violation of the terms and conditions of the insurance policy by the owner of the offending vehicle. Therefore, fastening the liability upon the insurance company is contrary to the judgments of the Supreme Court in National Insurance Co. Ltd. Vs. Vidhyadhar Mahariwala and Others, AIR 2009 SC 208 , Bhuwan Singh Vs. Oriental Insurance Company Ltd. and Another, AIR 2009 SC 2177 ; The New India Assurance Company Limited Vs. G. Sampoorna, (2010) 5 ALT 105 and Others, and National Insurance Co. Ltd. Vs. Parvathneni and Another, (2009) 8 SCC 785 . Further reliance is placed upon the decision of the Apex Court in the case of National Insurance Co. Ltd. Vs. Baljit Kaur and Others, AIR 2004 SC 1340 , wherein at para 17 interpreting provisions of section 147(1) of the Act with regard to the meaning of 'any person' it has been observed that 'any person' includes the owner of the goods or his authorised representative carried in the vehicle, besides the third party. In the case of Baljit Kaur (supra), reliance is placed upon the decision in the case of New India Assurance Co. Ltd. Vs. Asha Rani and Others, AIR 2003 SC 607 , wherein it has been opined that 'any person' must also be attributed having regard to the context in which they have been used, i.e., 'a third party'. Therefore, the appellant insurance company is not liable to pay the amount awarded in the impugned award. 4. The cross-appeal is strongly opposed by appellant on the ground that the same is barred by limitation, as the same is filed beyond four years which is not properly explained. Therefore, the cross-appeal is liable to be dismissed. Alternatively, it is submitted that the compensation amount of Rs. 4. The cross-appeal is strongly opposed by appellant on the ground that the same is barred by limitation, as the same is filed beyond four years which is not properly explained. Therefore, the cross-appeal is liable to be dismissed. Alternatively, it is submitted that the compensation amount of Rs. 3,32,000 as awarded by the Tribunal is just and reasonable and the claim made in the cross-appeal placing reliance upon Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, AIR 2009 SC 3104 , for enhancement of the compensation to Rs. 5,00,000 on the ground that deceased was in government employment, he was entitled to revision of scale of pay and other monetary benefits ancillary thereto, which is to be added to the gross income drawn as on the date of accident, cannot be granted. Therefore, it is contended that in the cross-appeal, at best the claimants are entitled to only Rs. 1,82,000 and they are not entitled to the entire compensation amount as claimed. 5. On the basis of the above said rival legal claims and counter-claims, the following points would arise for consideration: (i) Whether fastening the liability upon the insurance company by the Tribunal, in the impugned award, is legal and valid? (ii) Whether the objection regarding condonation of delay is required to be considered and allowed? (iii) Whether the cross-appellants are entitled for enhancement of compensation? If so, what amount? (iv) What award? 6. The appeal of the insurance company is liable to be dismissed for the following reasons: The reliance placed upon the decisions of Apex Court referred to supra in support of the contention of 'Act only' policy has no application to the fact situation of the present case in view of the interpretation made in section 147 of Motor Vehicles Act, 1988. Undisputedly the offending vehicle was insured with the appellant. Therefore, the contention urged that there is no liability for coverage of a gratuitous passenger in the car, cannot be construed as a third party for the purpose of awarding compensation fastening the liability upon the insurance company-appellant. The said contention is wholly untenable in law in view of the interpretation made in section 147 of the Act and number of decisions of this court and the Supreme Court, some of which are referred to above. 7. The judgments in the case of National Insurance Co. Ltd. Vs. The said contention is wholly untenable in law in view of the interpretation made in section 147 of the Act and number of decisions of this court and the Supreme Court, some of which are referred to above. 7. The judgments in the case of National Insurance Co. Ltd. Vs. Baljit Kaur and Others, AIR 2004 SC 1340 and Asha Rani, 2003 ACJ 1 (SC), are relied upon by both the counsel for the claimants and insurer. In the said decisions the Supreme Court has very carefully dealt with the gratuitous passenger in a goods vehicle. In the case at hand, the vehicle is not a goods vehicle. It is a car which is required to be insured compulsorily. Therefore, the ratio of the aforesaid decisions, upon which reliance is placed, cannot be applied in favour of the insurance company. In the case at hand, the deceased was travelling in a car. He cannot be treated as a gratuitous passenger. Another plea taken by the claimants is that there is no evidence placed on record by the insurance company that the deceased was travelling in the car as a gratuitous passenger, therefore, contention urged in this regard in this appeal by the insurance company is wholly untenable in law. Accordingly, the deceased has to be considered as a 'third party'. The interpretation given to section 147 and meaning of clause (b) (i), supports the case of the claimants. The contention urged in this regard that the policy is an 'Act only' policy, the deceased was a gratuitous passenger and the appellant is not liable to pay compensation, are wholly unacceptable for this court and accordingly such contention is rejected and the finding of fact recorded by the learned Member of the Tribunal in the impugned judgment is based on proper appreciation of legal evidence on record. Therefore, the same shall not be interfered with by this court as the finding cannot be termed as erroneous. 8. The second contention urged that the driver had no valid licence, also cannot be accepted for the reason that Tribunal, being the fact-finding authority, has recorded a finding on the basis of the evidence on record. Therefore, placing reliance on the driving licence verification report, Exh. 8. The second contention urged that the driver had no valid licence, also cannot be accepted for the reason that Tribunal, being the fact-finding authority, has recorded a finding on the basis of the evidence on record. Therefore, placing reliance on the driving licence verification report, Exh. D, without there being a plea and rebuttal evidence, contrary to the evidence adduced by the claimants and placing reliance upon the judgments of the Supreme Court and of Andhra Pradesh High Court referred to supra which are noted in the contention urged on behalf of the insurance company, is wholly untenable in law and liable to be rejected. Accordingly, the same is rejected. 9. So far as the delay in filing the cross-appeal is concerned, the undisputed fact is that as on the date of filing of the cross-appeal, the appeal of the insurance company was pending. The Apex Court in the case of Wadhya Mal Vs. Prem Chand Jain and Another, , in a situation like this has held that "we need not take a very strict view of the matter and we consider it appropriate to give an opportunity to the appellant to get his appeal adjudicated on merits on the only ground that the award which he seeks to challenge is under appeal by respondent No. 1 and respondent No. 2". Apart from the said legal proposition with regard to condonation of delay, the Supreme Court in the judgment in State of Bihar and Others Vs. Kameshwar Prasad Singh and Another, (2000) AIR(SCW) 2389 following the decision in the case of Collector, Land Acquisition, Anantnag and Another Vs. Mst. Katiji and Others, AIR 1987 SC 1353 extracting the relevant para from the above referred decision of the Apex Court, in exercise of its extraordinary and discretionary jurisdiction, condoned the delay and heard the appeal on merit. In my considered view, the said decision is aptly applicable to the case in hand. Having regard to the case in hand, this court is of the view that the compensation awarded in favour of the claimants is very meagre, though they are entitled for adequate compensation. Hence, the Tribunal has erred in awarding inadequate compensation. It is the duty of the Tribunal to award just and reasonable compensation in favour of the claimants even if they have claimed less compensation. Hence, the Tribunal has erred in awarding inadequate compensation. It is the duty of the Tribunal to award just and reasonable compensation in favour of the claimants even if they have claimed less compensation. Since the same has not been done, it is the duty of this court to examine the claimants' case on merit. For the reason that the compensation alone will not render justice either to the wife or the children as the deceased died at a young age, there being no other earning member in the family, the cross-objection has to be considered and just and reasonable compensation has to be awarded by applying the decision in the case of Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, AIR 2009 SC 3104 . 10. It is an undisputed fact that the deceased was a Senior Assistant in the State Government service. At the time of his death, he was 44 years old. Had he not died in the accident, he would have retired after 14 years at the age of 58. Therefore, there could have been periodical revision of pay scale. Consequently there could have been revision of D.A., A.D.A. and other monetary benefits which could have been added to the salary. Therefore, placing reliance upon the decision in Smt. Sarla Verma and Others Vs. Delhi Transport Corporation and Another, AIR 2009 SC 3104 , 30 per cent of the monthly income would be added to the gross salary which the deceased was earning at the time of death. That has not been taken into consideration by the Tribunal while awarding compensation. 11. In the case at hand, having regard to the age of the deceased multiplier of 13 would have been applied instead of 8 as applied by the Tribunal in the impugned award. At the time of death, the deceased was getting monthly salary of Rs.5,365 and after adding 30 per cent to the same the monthly salary income would have been Rs. 6,973 and after deducting 1/3rd there-from for personal expenses, the monthly contribution to the family would come to Rs. 4,648 and the yearly contribution on that basis would come to Rs. 55,776. Applying the multiplier of 13, the total compensation would be Rs. 7,45,088 and after deducting Rs. 50,000 paid by the Tribunal as interim compensation u/s 140 of the Act, the claimants would be entitled to Rs. 4,648 and the yearly contribution on that basis would come to Rs. 55,776. Applying the multiplier of 13, the total compensation would be Rs. 7,45,088 and after deducting Rs. 50,000 paid by the Tribunal as interim compensation u/s 140 of the Act, the claimants would be entitled to Rs. 6,95,088 rounded off to Rs. 6,95,100. Since the Claims Tribunal has awarded enhanced rate of interest at 9 per cent, the same is not disturbed. Claims Tribunal has awarded compensation of Rs. 3,32,000. The enhanced compensation will carry interest at the rate of 6 per cent to be paid from the date of claim till payment. The cross-appeal is accordingly allowed but the appeal filed by the insurance company is dismissed. The compensation deposited before this court is directed to be withdrawn by respondents-claimants. The remaining amount shall be calculated and paid within four weeks from the date of receipt of copy of this judgment. The enhanced compensation shall be apportioned among the claimants in the same proportion as per the impugned award passed by the Tribunal.