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2017 DIGILAW 921 (JK)

Bajaj Allianz Gen. Ins. Co. Ltd. v. Mohd. Sharief

2017-10-11

JANAK RAJ KOTWAL

body2017
JUDGMENT : Janak Raj Kotwal, J. 1. These two appeals are filed against the judgment and award dated 22.05.2012 rendered by the Motor Accident Claims Tribunal, Ramban (for short, the Tribunal) in a claim application under Section 163-A of the Motor Vehicles Act, 1988 (for short, the Act) involving death of one Mushtaq Ahmed (for short, the deceased), who died in a road traffic accident on 06.03.2008. The appeal in CIMA No. 424/2012 has been filed by the Insurance Company, whereas that in CIMA No. 232/2012 has been filed by two of the claimants (father and sister of the deceased) to whom compensation has not been awarded by the learned Tribunal. Heard learned counsel for the parties and perused the record. CIMA No. 424/2012: 2. In the claim application filed by the claimants against the insurer and the owner of the offending vehicle, it was, briefly, contended that on 06.03.2008 the deceased was driving the offending Tipper bearing registration No. JK 14-A 2110, which went out of his control. The deceased died on spot. It was contended also that the accident had occurred due to rash and negligent driving of the deceased. The income of the deceased was stated as Rs. 7000/- per month. The claim application was filed by six persons comprising of the parents of the deceased, his two sisters, wife and a minor daughter. 3. The owner of the offending Tipper, who was respondent No. 2 in the claim application, in his reply before the Tribunal admitted the claim. The insurer of the offending Tipper, herein appellant, however, contested the claim on various grounds. Learned Tribunal framed following issues: 1. Whether deceased Mushtaq Ahmed S/o. Mohd. Sharief R/o. Sangaldan while driving vehicle No. JK 14-A/2110 (Tipper) owned by respondent No. 2 and insured with respondent No. 1, died in a Road Traffic Accident on 06.03.2008 at Sangaldan, when the vehicle went out of his control? (OPP) 2. Whether petitioners are entitled to compensation for the death of the deceased Mushtaq Ahmed under Motor Vehicle Act and if so, to what extent? (OPP) 3. Whether the respondents are not liable to pay any compensation in view of the compensation of the terms and conditions of the Insurance Policy? (OPR) 4. Relief? 4. (OPP) 2. Whether petitioners are entitled to compensation for the death of the deceased Mushtaq Ahmed under Motor Vehicle Act and if so, to what extent? (OPP) 3. Whether the respondents are not liable to pay any compensation in view of the compensation of the terms and conditions of the Insurance Policy? (OPR) 4. Relief? 4. The learned Tribunal after holding inquiry in the claim application, in which inter-alia the evidence of the witnesses produced on behalf of the claimants was recorded, held that Issue No. 1 was proved in favour of the claimants. The Tribunal further held that income of the deceased was not more than Rs. 3000/- per month and, while taking his annual income as Rs. 36,000/- and deducting 1/3rd of his income towards his personal and living expenses, applied multiplier of 15, taking the age of the deceased as 25 years, and awarded Rs. 3,60,000/- as compensation for loss of dependency. In addition, Rs. 5000/- each were awarded for funeral expenses and loss of consortium. Learned Tribunal held also that only the wife and the minor child of the deceased were entitled to receive the compensation. Learned Tribunal, thus, awarded Rs. 3,70,000/- as compensation to respondents 5 & 6 with 7% per annum interest to be shared by both of them equally. 5. The appellant (insurer) has challenged the impugned judgment and award on two grounds. Firstly, that a claim under Section 163-A of the Act is not maintainable when the accident in question had occurred due to the negligence of the victim and secondly, that claim under Section 163-A is not maintainable when the annual income of the deceased is more than Rs. 40,000/-. It is worthwhile to underline here that both these grounds were taken by the appellant in its reply before the Tribunal also but the learned Presiding Officer of the Tribunal, as is evident from the impugned judgment and award, seems to have rushed through to pass the award, it may be said, in a perfunctory manner, without realizing the importance of addressing the important questions of law raised on behalf of the appellant. Be that as it may, both these objections are being taken up herein. 6. In support of the first objection, Mr. Be that as it may, both these objections are being taken up herein. 6. In support of the first objection, Mr. Vishnu Gupta, learned counsel appearing on behalf of the appellant, submitted that a claim for compensation under Section 163-A is not based on the principle of 'no fault' liability of the owner or the insurer inasmuch it is open for the owner or the insurer of the vehicle, which is alleged to have been involved in the accident, to raise a defence that accident out of which the claim arises had occurred due to negligence of the victim and to prove the same by leading evidence. Mr. Gupta pointed out that admitted case of the claimants is that the accident had occurred due to negligence of the deceased, who was driving the vehicle at the relevant time so claim for compensation under Section 166 or under Section 163-A of the Act was not maintainable but the learned Tribunal has ignored this important aspect of the case and has committed illegality by entertaining the claim and awarding the compensation in terms of Section 163-A. Mr. Gupta relied upon Supreme Court judgment in National Insurance Co. Ltd. vs. Sinitha and Others, 2001 (8) Supreme 301. 7. Per contra, Mr. R.K.S. Thakur, learned counsel appearing on behalf of the claimants, herein respondents 1 to 5, argued that a claim under Section 163-A of the Act is indeed based on the principle of 'no fault' liability and is not defeated even if the accident had occurred due to negligence of the victim, that is, the deceased or the injured, in respect of whom the compensation is claimed. Mr. Thakur relied upon the Supreme Court judgments in Deepal Girishbhai Soni and Others vs. United India Insurance Co. Ltd. 2004 ACJ 934 and United India Ins. Co. Ltd. vs. Sunil Kumar and Another, 2013 ACJ 2856 . 8. In Deepal Girishbhai Soni a learned three-Judge Bench of the Supreme Court after a detailed analysis of the scope of Sections 166, 163-A and 140 of the Act has held in para 66 of the reporting that "Section 163-A of the Act covers cases where even negligence is on the part of victim. 8. In Deepal Girishbhai Soni a learned three-Judge Bench of the Supreme Court after a detailed analysis of the scope of Sections 166, 163-A and 140 of the Act has held in para 66 of the reporting that "Section 163-A of the Act covers cases where even negligence is on the part of victim. It is by way of an exception to Section 166 and concept of social justice has been duly taken care of." In Sinitha and Others relied upon by the counsel for the appellants, a learned two-Judge Bench of the Supreme Court indeed has held that "a claim for compensation under Section 163-A unlike a 'no fault' liability claim under Section 140 is not based wholly on the principle of 'no fault' liability of the offending vehicle and, even though the claimant is required neither to plead nor to establish any wrongful act, neglect or default on the part of driver or owner of the offending vehicle, it is permissible for the owner or the insurer of the offending vehicle to defeat the claim by pleading and establishing that the accident out of which the claim arises was caused by the wrongful act, neglect or default on the part of the victim". In view of the ratio of the judgment in Sinitha and Others the claim in this case definitely would fail as it is admitted that the accident causing the death of the deceased had occurred due to his own negligence. Position, however, is otherwise in view of the ratio in Deepal Girishbhai Soni. 9. The divergence of views in the aforementioned two cases has been noticed by another learned two-Judge Bench of the Supreme Court in Sunil Kumar (supra) and it has been held that "liability to make compensation under Section 163-A is on the principle of no fault and, therefore, the question as to who is at fault is immaterial and foreign to an enquiry under Section 163-A". It is held further that "if the owner of the vehicle or the insurance company is permitted to prove contributory negligence or default or wrongful act on the part of the victim or claimant, naturally it would defeat the very object and purpose of section 163-A of the Act". Legislature never wanted the claimant to plead or establish negligence on the part of the owner or the driver. Legislature never wanted the claimant to plead or establish negligence on the part of the owner or the driver. Once it is established that death or permanent disablement occurred during the course of the user of vehicle and the vehicle is insured, the insurance company or the owner, as the case may be, shall be liable to pay the compensation, which is statutory obligation. Learned Bench, while expressing inability to agree with the view taken in Sinitha's case (supra) has made a recommendation for reference of the matter to the larger Bench inter-alia for "a correct interpretation of the scope of Section 163-A" of the Act. 10. The legal position based upon the judgment in Deepal Girishbhai Soni and Sunil Kumar as of now is that a claim for compensation under Section 163-A of the Act is based on the principle of 'no fault' liability and covers the cases where even negligence is on the part of the victim, as the case on hand is. The first objection taken by the appellants, therefore, fails. 11. In regard to the second objection, it was contended by Mr. Gupta, appearing on behalf of the appellant, that claim application filed under Section 163-A ex facie was not maintainable in view of the claimants' plea that the monthly income of the deceased was Rs. 7000/- as in that his annual income was more than Rs. 40,000/-. Learned counsel submitted that learned Tribunal in order to award compensation in terms of Section 163-A has deliberately taken the annual income of the deceased as Rs. 36,000/- contrary to the claimants' plea and evidence that his income was Rs. 7000/- per month. Learned counsel relied upon Deepal Girishbhai (supra) and a Division Bench Judgment of Kerala High Court in United India Insurance Co. vs. Akbar Shihab, 2013 ACJ 121. 12. Per contra, Mr. Thakur, appearing on behalf of the respondents-claimants, submitted that a claim under Section 166 of the Act is based on the principle of 'fault liability' whereas a claim under Section 163-A is based on the principle of 'no fault' liability. vs. Akbar Shihab, 2013 ACJ 121. 12. Per contra, Mr. Thakur, appearing on behalf of the respondents-claimants, submitted that a claim under Section 166 of the Act is based on the principle of 'fault liability' whereas a claim under Section 163-A is based on the principle of 'no fault' liability. It is open for the claimants or a victim, having suffered permanent disability, to opt for lodging a claim under Section 163-A even in a case where the accident had occurred due to fault or negligence in order to avoid the rigor of proving fault or negligence on the part of the driver or the owner of the offending vehicle as also in a case where claim under Section 166 is not maintainable for the accident having taken place due to negligence of the victim or the injured as the case may be. Learned counsel relied upon Sarla Verma and Others vs. Delhi Transport Corporation and Another, JKJ Soft JKJ/32047 : AIR 2009 SC 3104 . 13. As said hereinabove, Supreme Court in Deepal Girishbhai (supra) has analyzed in detail the scheme of Sections 166, 163-A and 140 of the Act. Some of the important observations made by the Hon'ble Court in Deepal Girishbhai have been noticed. It has been observed in paras 39 & 40 of the reporting that Section 163-A was introduced in the Act by way of a social security scheme to provide for payment of compensation in motor accident cases in accordance with the Second Schedule providing for the structured formula which may be amended by the Central Government from time to time. In para 46, it has been observed that Section 163-A, which has an overriding effect, provides for special provisions as to payment of compensation on structured formula basis. Sub-Section (1) of Section 163-A contains non obstante clause in terms whereof the owner of the motor vehicle or the authorized insurer is liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule. In para 48, Hon'ble Court has held that "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 there under whereas Sections 140 and 166 cater to all sections of society." 14. In para 48, Hon'ble Court has held that "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 there under whereas Sections 140 and 166 cater to all sections of society." 14. In Akbar Shihab (supra), the compensation had been claimed under Section 166 of the Act and the plea taken by the insurance Company was that the accident was the result of negligence on the part of the claimant. The Claims Tribunal after enquiry, while finding that the accident was direct result of the negligence of the claimant, however, awarded compensation in terms of Section 163-A. The learned Division Bench of the Kerala High Court, while relying upon Deepal Girishbhai (supra) held also that "in a claim under Section 163-A of the Act there should be a specific averment in the petition to the effect that the annual income of the claimant does not exceed Rs. 40,000/-". 15. The question arising in regard to the case on hand is whether claim application filed by the claimants under Section 163-A of the Act is not maintainable for the reason that according to the claimants the annual income of the deceased was Rs. 84,000/-, that is, more than Rs. 40,000/-. 16. It needs to be underlined that Sections 166 and 163-A of the Act are two independent provisions mutually exclusive from each other. A claim under Section 166 is based on the principle of fault liability so in a claim application under this provision the claimants are required to plead and establish wrongful act, neglect or default on the part of the driver or the owner of the offending vehicle. In a claim under Section 163-A the claimants, on the other hand, are not required to plead and establish such wrongful act, neglect or default on the part of the driver or the owner of the vehicle involved in the accident and the compensation would be awarded even if negligence was on the part of the victim. 17. In a claim under Section 163-A the claimants, on the other hand, are not required to plead and establish such wrongful act, neglect or default on the part of the driver or the owner of the vehicle involved in the accident and the compensation would be awarded even if negligence was on the part of the victim. 17. In a case where accident occurs due to wrongful act or default on the part of the driver or the owner of the offending vehicle, the persons claiming compensation have a choice to lodge the claim for compensation either under Section 166 of the Act or under Section 163-A. In the former case, the claimants will have to plead and establish the wrongful act, neglect or default on the part of the owner or driver of the offending vehicle and would be entitled to compensation as may be assessed by the claims tribunal/court, whereas in the latter case the claimants would be absolved of the responsibility of pleading and establishing the wrongful act, neglect or default on the part of the owner or driver of the offending vehicle. However, in an application under Section 163-A, the claimant would get only the limited compensation in accordance with the structured formula provided under the Second Schedule to the Act, having regard to the annual income and age of the victim. It is because of this difference between the requirement of the two provisions that in a case where the accident had occurred due to wrongful act, neglect or fault on the part of the driver or owner of the offending vehicle, one may opt to file the claim application under Section 163-A even though such an application could have been filed under Section 166. Option of filing claim application under Section 163-A, however, would not be available to the claimants where income of the victim of the accident was more than Rs. 40,000/-. 18. The possibility of exercising the option of filing a claim application under Section 166 of the Act or under Section 163-A, however, is not available in a case where admittedly the accident had occurred due to the wrongful act, neglect or default on the part of the victim of the accident himself for the reason that in such a case a claim under Section 166 of the Act would not lie. In such a case, the claimants cannot be debarred from filing a claim under Section 163-A of the Act, which covers cases where even negligence is on the part of victim, only for the reason that the annual income of the victim was more than Rs. 40,000/-. Such a view is discernable in Sarla Verma's case where in para 17 of the reporting, there is clear indication of maintainability of a claim under Section 163-A of the Act even where annual income of the deceased was more than Rs. 40,000/-. Para 17 in its relevant portion is as under: "The Motor Vehicles Act, 1988 was amended by Act 54 of 1994, inter-alia inserting Section 163-A and the Second Schedule with effect from 14.11.1994. Section 163-A of the MV Act contains a special provision as to payment of compensation on structured formula basis, as indicated in the Second Schedule to the Act. The Second Schedule contains a Table prescribing the compensation to be awarded with reference to the age and income of the deceased. It specifies the amount of compensation to be awarded with reference to the annual income range of Rs. 3,000/- to Rs. 40,000/-. It does not specify the quantum of compensation in case the annual income of the deceased is more than Rs. 40,000/-. But it provides the multiplier to be applied with reference to the age of the deceased. The table starts with a multiplier of 15, goes up to 18, and then steadily comes down to 5. It also provides the standard deduction as one-third on account of personal living expenses of the deceased. Therefore, where the application is under section 163-A of the Act, it is possible to calculate the compensation on the structured formula basis, even where compensation is not specified with reference to the annual income of the deceased, or is more than Rs. 40,000/- by applying the formula: (2/3 x AI x M), that is two-thirds of the annual income multiplied by the multiplier applicable to the age of the deceased would be the compensation. Several principles of tortious liability are excluded when the claim is under section 163-A of MV Act..." (Underlining by me) 19. For the reasons stated and discussed above, this appeal has no merit is dismissed. CIMA No. 232/2012: 20. Several principles of tortious liability are excluded when the claim is under section 163-A of MV Act..." (Underlining by me) 19. For the reasons stated and discussed above, this appeal has no merit is dismissed. CIMA No. 232/2012: 20. None appeared in this appeal for the appellants when the matter was taken up on the previous date, that is, 11.09.2017. None appears today also. Dismissed in default.