JUDGMENT : SARAL SRIVASTAVA, J. 1. Heard Sri V.C. Dixit, learned counsel for the appellant and Sri A.P. Paul, learned counsel for the respondent. 2. The present appeal is directed against the judgment and award dated 24.12.2005 passed by Motor Accident Claims Tribunal/Additional District Judge, Court No. 7, Azamgarh, whereby the Tribunal has awarded Rs.3,44,500/- along-with 6% interest to the claimant-respondent. 3. The brief facts of the case are that on 29.8.1986 at about 12:00 noon, one Anil Kumar Singh was pillion rider on a motorcycle, which met with an accident with Jeep No. U.H. X- 178 (hereinafter referred as "offending jeep") near Rani Ki Sarai, district Azamgarh. As a result of the said accident, Anil Kumar Singh suffered injuries which resulted in his death. The deceased was aged about 21 years on the date of the accident and was earning about Rs. 2,500/- per month by running a General Merchant Shop. In the aforesaid backdrop, the claimant-respondent instituted a claim petition praying for a compensation of Rs.16,10,000/-. 4. The claim petition was contested by the appellant-insurance company by filing written statement contending therein that no accident had taken place by the offending jeep. It was pleaded that the liability of the insurance company is subject to the terms and conditions of the insurance policy. By amendment in the written statement, the insurance company also pleaded that since the motorcycle was hit by offending jeep which was coming from opposite direction, therefore, driver of the motorcycle was also negligent in the accident. On the basis of the aforesaid pleadings, the insurance company denied its liability to pay compensation. 5. The owner of the offending jeep also filed written statement denying the averments of the claim petition. He further pleaded that the offending jeep was insured with Oriental Insurance Company Limited and was plied with all valid papers, therefore, the liability to pay compensation, if any, is of the insurance company. 6. On the basis of the pleadings, the Tribunal framed as many as 6 issues. 7. In the instant appeal, learned counsel for the appellant has assailed the finding on issue no. 5 in respect of contributory negligence of driver of motorcycle in the accident; issue no. 8 as to whether, the liability of the insurance company is Rs.50,000/- or beyond it and issue no. 4 relating to the quantification of compensation. 8. The Tribunal in deciding the issue no. 5 in respect of contributory negligence of driver of motorcycle in the accident; issue no. 8 as to whether, the liability of the insurance company is Rs.50,000/- or beyond it and issue no. 4 relating to the quantification of compensation. 8. The Tribunal in deciding the issue no. 5 with respect to the negligence of the motorcycle in the accident on the basis of the testimony of eye witness namely PW-2 Rajendra Singh and other documentary evidence namely site-plan of the accident, F.I.R. etc. held that there was no negligence of the driver of motorcycle in the accident. 9. On the issue of quantification of compensation, the Tribunal assessed the income of the deceased to be Rs.2,500/- per month on the basis of evidence on record and, thereafter, deducted 1/3rd from the said income and by applying the multiplier of 17 awarded Rs.3,40,000/- toward loss of income. Besides the above, the Tribunal further awarded Rs.2,000/- towards funeral expenses and Rs.2,500/- towards loss of estate. Thus, in total the Tribunal awarded Rs.3,44,500/- along with 6% interest as compensation to the claimant-respondent. 10. The Tribunal on the issue of liability of the insurance company held that since the claim petition has been instituted after the Motor Vehicles Act, 1988 (hereinafter referred as "Act, 1988") have come into effect and the liability of the insurance company is unlimited under Section 147(2) (a) of the Act, 1988, therefore, the insurance company is liable to pay entire awarded amount. 11. The learned counsel for the appellant has challenged the award on the following grounds: (i). There was undue delay of 11 years in filing the claim petition, as the accident had taken place on 29.8.1986, whereas the claim petition was filed on 16.1.1997. Thus, the claim petition deserved to be dismissed on the ground of inordinate delay in filing the same. (ii). As admittedly the offending jeep was coming from opposite direction and the motorcycle had collided with the offending jeep head on, therefore, the driver of the motorcycle was also negligent in the accident. Thus, the Tribunal should have reduced the compensation to the extent of negligence of the driver of the motorcycle in the accident. (iii). (ii). As admittedly the offending jeep was coming from opposite direction and the motorcycle had collided with the offending jeep head on, therefore, the driver of the motorcycle was also negligent in the accident. Thus, the Tribunal should have reduced the compensation to the extent of negligence of the driver of the motorcycle in the accident. (iii). Since, the offending jeep was used for carrying passengers and was a Public Service Vehicle as defined under Section 2( 25) of the Motor Vehicle Act,1939, and the liability of the insurance company under the insurance policy is up to Rs.50,000/- and not beyond it. Hence, the insurance company is liable to pay Rs.50,000/-, out of the awarded amount and for rest of amount, the liability is of the owner. (iv). Since, there was no evidence on record in respect of the income of the deceased , therefore, the assessment of the income of the deceased by the Tribunal as Rs.2,500/- per month is excessive and is not sustainable in law. 12. Refuting the aforesaid submission, learned counsel for the respondent has submitted that the owner of the offending jeep has admitted the accident and further, the insurance company has also admitted the factum of the accident. Thus, the delay in filing the claim petition is not vital in the facts of the present case as the object of the Motor Vehicles Act is to provide compensation to the family of a person who had suffered accidental death. 13. He further contends that the finding of the Tribunal on the issue of negligence is based upon the testimony of PW-2 Rajendra Singh, eye witness of the accident, and also the documentary evidence on record namely site-plan and charge-sheet against the driver of the offending jeep, and as the insurance company has not led any evidence to rebut the testimony of the PW-2 Rajendra Singh, therefore, the finding of the Tribunal on the issue of negligence is based upon proper appreciation of evidence and material on record and being a finding of fact is not liable to be interfered with in appeal. 14. Learned counsel for the respondent further submits that the Tribunal was right in holding the liability of the insurance company to pay the compensation inasmuch as under the insurance policy, the liability to pay compensation is upon the insurance company. 15. 14. Learned counsel for the respondent further submits that the Tribunal was right in holding the liability of the insurance company to pay the compensation inasmuch as under the insurance policy, the liability to pay compensation is upon the insurance company. 15. He further submits that even otherwise, the claimants are the third party and therefore, they should not suffer for a breach of policy which is essentially a matter between the insurer and insured and insurance company after paying the award can recover it from the owner. 16. I have considered the rival submissions of the parties and perused the record. 17. In the present case, the appellant has proved the accident by producing PW-2 Rajendra Singh, who was the eye witness of the accident. Besides the above, the appellant also filed F.I.R. and charge-sheet against the driver of the offending jeep. The insurance company did not dispute the correctness of the F.I.R. and charge-sheet against the driver of the offending jeep. 18. Further, it is worth noticing that certified copy of judgment and award 14.11.2019 in another claim petition no. 12 of 1987 (Devi Prasad Rai Vs. Hari Ram Yadav and others) arising out of the same accident is on record and the insurance company has satisfied the award. Thus, the occurrence of the accident is proved and, therefore, delay in filing the claim petition is not relevant and the insurance company cannot deny its liability to pay compensation due to delay in filing the claim petition. The judgment of the Apex Court in the case of Purohit and Company Vs. Khatoonbee and another, (2017) 4 SCC 783 relied upon by the learned counsel for the appellant is of no help to him inasmuch in the said case there was no evidence to prove the accident whereas in the present case besides the testimony of eye witness, there is judgment of the tribunal in M.A.C.P. No.12 of 1987 arsing out of the same accident confirming the occurrence of the accident. Thus, the submission of the learned counsel for the appellant in respect of delay in filing the claim petition is rejected. 19. So far as the issue of contributory negligence is concerned, in the present case, the Tribunal on the basis of statement of eye witness PW-2 Rajendra Kumar and other documentary evidence on record held the negligence of the offending jeep in the accident. 19. So far as the issue of contributory negligence is concerned, in the present case, the Tribunal on the basis of statement of eye witness PW-2 Rajendra Kumar and other documentary evidence on record held the negligence of the offending jeep in the accident. Even otherwise, the plea of contributory negligence is not open to insurance company in the present case inasmuch as, in the case in hand the deceased was pillion rider and, therefore, it was a case of composite negligence. The judgment of the Apex Court in the case of Khenyei Vs. New India Assurance Company Limited and others, (2015) 9 SCC 273 covers the issue of negligence. Paragraph Nos. 20 to 22 of the aforesaid judgment are being reproduced herein below: "20. This Court in Challa Upendra Rao & Nanjappan has dealt with the breach of policy conditions by the owner when the insurer was asked to pay the compensation fixed by the tribunal and the right to recover the same was given to the insurer in the executing court concerned if the dispute between the insurer and the owner was the subject-matter of determination for the tribunal and the issue has been decided in favour of the insured. 21. The same analogy can be applied to the instant cases as the liability of the joint tortfeasor is joint and several. In the instant case, there is determination of inter se liability of composite negligence to the extent of negligence of 2/3rd and 1/3rd of respective drivers. Thus, the vehicle - trailor-truck which was not insured with the insurer, was negligent to the extent of 2/3rd. It would be open to the insurer being insurer of the bus after making payment to the claimant to recover from the owner of the trailor-truck the amount to the aforesaid extent in the execution proceedings. Had there been no determination of the inter se liability for want of evidence or other joint tortfeasor had not been impleaded, it was not open to settle such a dispute and to recover the amount in execution proceedings but the remedy would be to file another suit or appropriate proceedings in accordance with law. 22. Had there been no determination of the inter se liability for want of evidence or other joint tortfeasor had not been impleaded, it was not open to settle such a dispute and to recover the amount in execution proceedings but the remedy would be to file another suit or appropriate proceedings in accordance with law. 22. What emerges from the aforesaid discussion is as follows : 22.1 In the case of composite negligence, plaintiff/claimant is entitled to sue both or any one of the joint tortfeasors and to recover the entire compensation as liability of joint tortfeasors is joint and several. 22.2 In the case of composite negligence, apportionment of compensation between two tortfeasors vis-a-vis the plaintiff/claimant is not permissible. He can recover at his option whole damages from any of them. 22.3 In case all the joint tortfeasors have been impleaded and evidence is sufficient, it is open to the court/tribunal to determine inter se extent of composite negligence of the drivers. However, determination of the extent of negligence between the joint tortfeasors is only for the purpose of their inter se liability so that one may recover the sum from the other after making whole of the payment to the plaintiff/claimant to the extent it has satisfied the liability of the other. In case both of them have been impleaded and the apportionment/ extent of their negligence has been determined by the court/tribunal, in the main case one joint tortfeasor can recover the amount from the other in the execution proceedings. 22.4 It would not be appropriate for the court/tribunal to determine the extent of composite negligence of the drivers of two vehicles in the absence of impleadment of other joint tortfeasors. In such a case, impleaded joint tortfeasor should be left, in case he so desires, to sue the other joint tortfeasor in independent proceedings after passing of the decree or award." 20. So far as the contention of the learned counsel for the appellant with respect to the limited liability of the insurance company is concerned, it is worth noticing that the permit of the jeep 54 Ga(2) was issued for a period from 30.6.1986 to 29.10.1986 by the Regional Transport Authority, Gorakhpur. Thus, on the date of the accident, the permit was valid. Thus, on the date of the accident, the permit was valid. Thus, it is evident from the record that offending jeep was used for carrying passengers for hire and reward thus, it was a public service vehicle as defined in Section 2(25) of the Motor Vehicles Act, 1939. The offending jeep was insured by the appellant as commercial vehicle and as per the insurance policy liability of the insurance company is up to Rs.50,000/- not beyond it. The relevant portion of the condition of the insurance policy under the heading of limits of liability is extracted herein below: Limit of the amount of the Company's liability under Section II-1 (ii) in respect of any/one claim or series of claims arising out of one event Rs.50,000/-. 21. At this juncture, it is useful to notice Section 95(2) (b) (i) of the Act 1939 which is extracted herein below: Section 95 (2): Subject to the proviso to sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely- (a) ... (b) where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment,- (i) in respect of persons other than passengers carried for hire or reward, a limit of fifty thousand rupees in all; 22. A plain reading of Section 95(2) (b) (i) shows that the liability of the insurance company in case of vehicle used for carrying passengers for hire or reward is up to Rs.50,000/- only in respect of persons other than passengers traveling on the vehicle on hire. Thus, the liability of company in case of third party is only up to Rs.50,000/-. 23. The Apex Court in the case of National Insurance Company Limited Vs. Keshav Bahadur and others, (2004) 2 SCC 370 , held that the liability of the insurance company cannot be more than what is provide in the statute unless an extra premium has been paid for covering the risk of amount more than statutory liability of the insurance company. Paragraphs Nos. 7 and 8 of the aforesaid judgment are being reproduced herein below: "7. In case of appellant insurer not taking any higher liability by accepting higher premium, the liability is neither unlimited nor higher than the statutory liability fixed under Section 95(2) of the Act. Paragraphs Nos. 7 and 8 of the aforesaid judgment are being reproduced herein below: "7. In case of appellant insurer not taking any higher liability by accepting higher premium, the liability is neither unlimited nor higher than the statutory liability fixed under Section 95(2) of the Act. Even if a vehicle is the subject matter of comprehensive insurance and a higher premium is paid on that score, limits of the liability with regard to third party risk do not become unlimited or higher beyond the statutory liability fixed. For this purpose, a specific agreement has to be arrived at between the insured and the insurer and separate premium has to be paid in respect of additional amount of liability undertaken by the insurer in that regard. This position was highlighted by this Court in National Insurance Co. Ltd. v. Jugal Kishore, (1988) 1 SCC 626 In New India Assurance Co. Ltd. v. C.M. Jaya and others, (2002) 2 SCC 278 ) a Constitution Bench approved the view taken in Shanti Bai (supra) and Jugal Kishore (supra). It was held that in case of insurer not taking any higher liability by accepting higher premium for payment of compensation to third party, the insurer would be liable to the extent limited under Section 95(2) of the Act and would not be liable to pay the entire amount of compensation awarded. 8. The inevitable conclusion on the factual backgrounds is that the liability of the insurer-appellant is limited to Rs.50,000/-. The residual question is whether there could be any stipulation of penal rate of interest as done by the Tribunal and affirmed by the High Court. So far as the higher rate of interest stipulation is concerned, it is to be noted that grant of interest under Section 110CC of the Act (corresponding to Section 171 of the Motor Vehicles Act, 1988) (in short the ''new Act'') is discretionary. The purpose for award of interest is to put pressure on the relevant person not to delay in making the payment; and, to compensate the victim or his dependents at least to some extent for such delay as may occur, by way of interest. The purpose for award of interest is to put pressure on the relevant person not to delay in making the payment; and, to compensate the victim or his dependents at least to some extent for such delay as may occur, by way of interest. In determining the quantum of interest awardable under the relevant Section, the Tribunal acting under Section 110 of the Act corresponding to Section 166 of the new Act can derive direct guidance from Section 34 of the Code of Civil Procedure, 1908 (in short the 'CPC'). In fact, the provisions require payment of interest in addition to compensation already determined. Even though the expression ''may'' is used, a duty is laid on the Tribunal to consider the question of interest separately with due regard to the facts and circumstances of the case. The provision is discretionary and is not and cannot be bound by rules. In the words of Lord Cairns, L.C. in Julius v. Bishop of Oxford, 1880 5 AC 214), "But there may be something in the nature of the thing empowered to be done, something in the object for which it is to be done, something in the conditions under which it is to be done, something in the title of person or persons for whose benefit the power is to be exercised, which may couple the power with a duty, and make it the duty of the person in whom the power is reposed to exercise that power when called upon to do so". This classic observation has been quoted with approval by this Court in several cases. (See Commr. of Police v. Gordhandas Bhanji, (1952) AIR SC 16 and S.P. Gupta and Ors. v. President of India and Ors., (1982) AIR SC 149. In Halsbury's Laws of England, 4th Edn., Vol.I, it has been observed:- "28 Duty and discretion. - A statutory discretion is not, however, necessarily or, indeed, usually absolute: It may be qualified by express and implied legal duties to comply with substantive and procedural requirements before a decision is taken whether to act and how to act. Moreover, there may be a discretion whether to exercise a power, but no discretion as to the mode of its exercise; or a duty to act when certain conditions are present, but a discretion how to act. Discretion may thus be coupled with duties"." 24. Moreover, there may be a discretion whether to exercise a power, but no discretion as to the mode of its exercise; or a duty to act when certain conditions are present, but a discretion how to act. Discretion may thus be coupled with duties"." 24. In the present case, there is no evidence on record to indicate that any extra premium has been paid by the owner covering the risk of additional amount and, therefore, the liability of the insurance company in the instant case cannot be more than Rs.50,000/- in case of a third party. 25. It is settled in law that the liability of the insurance company in respect of a claim is governed by the provisions of Act applicable on the date of the accident. In this context, it would be useful to notice that the judgment of the Apex Court in the case of Ramesh Singh and another Vs. Cinta Devi and others, (1996) 3 SCC 142 , wherein the appellate court while deciding the issue as to whether the insurance company is required to deposit Rs.25,000/- as provided in the proviso to Section 173 of the Motor Vehicle Act 1988 after considering Section 217(4) of the New Act and Section 6 of the General Clauses of the Act held that the Act, 1988 neither expressly nor by necessary implication make the relevant provisions retrospective in character, and consequently it held that the insurance company is not required to deposit the amount of statutory deposit for maintainability of the appeal if the accident had taken place when the Act of 1939 was in operation. 26. In the present case reading of Section 147 (i) (b) of the Act 1988 does not indicate that it has been made expressly or impliedly effective retrospectively. Thus, in view of the aforesaid settled position of law, the Tribunal has committed manifest illegality in holding that as the claim petition has been filed after commencement of the Act 1988, therefore, Section 147 (i) (b) of Act of 1988 would govern the liability of insurance company which is unlimited under the said Section. 27. Thus, in the facts of the present case, the liability of the insurance company is only up to Rs.50,000/- and not beyond it, consequently, the finding of the Tribunal on issue no. 27. Thus, in the facts of the present case, the liability of the insurance company is only up to Rs.50,000/- and not beyond it, consequently, the finding of the Tribunal on issue no. 8 in respect of liability of the insurance company being unlimited is not sustainable and accordingly set-aside. 28. So far as the question of quantification of compensation is concerned, the same appears to be also on higher side inasmuch as, the accident had taken place in the year 1986 and the assessment of the income of the deceased to be Rs.2,500/- based on no evidence on record is not sustainable, particularly in view of the fact that Schedule I of the Act,1988 framed under Sec.163A brought into effect in the year 1994 provided the notional income to be Rs.15000/-P.A. Thus, considering the fact that deceased was running a general merchant shop, it wold be appropriate to take Rs.750/-P.M. as income of the deceased for the purpose of computing the compensation. Considering the age of the deceased, the claimant-respondent is also entitled to 40% future prospect and multiplier of 18 is applicable for computing compensation. 29. Thus, the claimant respondent is entitled to compensation as per the chart given below: Sr. No. Head Calculation (i) Income of deceased Rs.7,50x12=9000/- per annum (ii) 40% to be added as future prospect (Rs.9,000+Rs.3,600 =Rs.12,600/- (iii) 1/2 to be deducted towards personal expenses (Rs.12,600-6,300= 6,300/-) (iv) Compensation after multiplier of 18 is applied (Rs.6,300 X 18 =Rs. 1,13,400/-) (v) Loss of Funeral Expenses Rs.2,000/- (vi) Loss of estate Rs.2,500/- Total Compensation Awarded. Rs.1,17,900/- 30. Hence, the claimant respondent is entitled to Rs.1,17,900/- . The said amount shall carry 7% interest from the date of institution of claim petition. 31. Consequently, The appeal is allowed and the award of the Tribunal is modified to the extent indicate above. It is further provided that as the liability of the insurance company is only up to Rs.50,000/- therefore, the insurance company shall be entitled to recover the amount paid in excess of its liability under the interim order of this Court from the owner. It is further provide that the claimant is entitled to execute the award for the balance amount from the owner. There shall be no order as to costs.