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2025 DIGILAW 1254 (AP)

Oriental Insurance Company Ltd. v. Mudiyala Anasuya

2025-12-19

B.S.BHANUMATHI

body2025
JUDGMENT : B. S. Bhanumathi, J. M.A.C.M.A.No.2311 of 2005 is filed by the Insurance Company against the order and the decree, dated 09.03.2005, in M.O.P.No.1133 of 1999 on the file of the Chairman, Motor Accidents Claims Tribunal- cum-V Additional District Judge, Visakhapatnam, on the ground that the compensation awarded is highly exorbitant. M.A.C.M.A.No.2195 of 2013 is preferred by the claimants against the order and the decree, dated 09.03.2005, in M.O.P.No.1133 of 1999 on the file of the Chairman, Motor Accidents Claims Tribunal-cum-V Additional District Judge, Visakhapatnam, by which the Tribunal awarded compensation of Rs.9,97,000/- with proportionate costs and interest at the rate of 9% per annum, to the claimants on account of the death of Mudiyala Raghurama Reddy in a motor vehicle accident that occurred on 14.07.1998 at about 10.15 P.M. 2. In M.A.C.M.A.No.2311 of 2005, the appellant is the Oriental Insurance Company and the respondents Nos.1 to 5 are the claimants. In M.A.C.M.A.No.2195 of 2013, the appellants are the claimants and the respondents Nos.3 & 4 are the National Insurance Company and the Oriental Insurance Company. 3. The respondents Nos.6 & 7 in M.A.C.M.A.No.2311 of 2005, and the respondents Nos.1 & 2 in M.A.C.M.A.No.2195 of 2013, who are the driver and the owner of the offending vehicle, i.e., trailer bearing No.AP 31 U 6768 remained ex parte before the Tribunal and the appeals against them stood dismissed. 4. Since both the appeals are connected, they are heard together and are being disposed of by this common judgment. 5. The case of the claimants, is briefly, as follows: On 14.07.1998, at about 10.15 P.M., M.Raghurama Reddy (hereinafter referred to as the deceased) met with an accident while he was coming on his scooter bearing No.AP 31 D 7046 on NH-5 road leading from Anakapalle to Gajuwaka near A.P.T.A. office as the scooter hit a trailer bearing No.AP 9 U 6768 parked negligently without any indicators, in the middle of the road. The claimants sought compensation of Rs.10 lakhs. The claim was initially filed against respondents Nos.1 to 3 who are the driver, owner and insurer of the trailer. Later, the respondent No.4 was added. The claim was opposed by filing a counter of respondent No.3 denying the allegation that the trailer was insured with it. The respondent No.4 filed a separate counter denying the averments in the petition and the amount of compensation claimed. 6. Later, the respondent No.4 was added. The claim was opposed by filing a counter of respondent No.3 denying the allegation that the trailer was insured with it. The respondent No.4 filed a separate counter denying the averments in the petition and the amount of compensation claimed. 6. On behalf of the claimants, PWs 1 to 3 were examined and exhibits A1 to A10 were marked. On behalf of the respondents / insurance company, R.Ws. 1 to 3 were examined and exhibits B1 to B8 were marked. a. Ex.A1 is the xerox copy of F.I.R., dated 15.07.1998, in Crime No.81 of 1998 of Gajuwaka Traffic Police Station; Ex.A2 is the xerox copy of post mortem certificate, dated 15.07.1998; Ex.A3 is the xerox copy of inquest report, dated 15.07.1998; Ex.A4 is positive photographs without negatives; Ex.A5 is the retail licence for the sale of all kinds of Indian Liquor, dated 03.04.1998, issued by the Prohibition & Excise Superintendent; Ex.A6 is the letter, dated 05.10.1999, issued by National Insurance Company Limited to the Advocate, Sri S.Surya Rao; Ex.A7 is the xerox copy of insurance policy of the Trailer bearing no. AP 9 U 6768, dated 16.10.1998; Exs.A8 to A10 are the income tax returns of Sri M. Raghurama Reddy. b. Ex.B1 is the copy of letter, dated 05.10.1999, addressed by insurance company; Ex.B2 is the office copy of the letter addressed to Sri S.Surya Rao; Ex.B3 is the office copy of letter dated 21.07.2001; Ex.B4 is the office copy of letter, dated 20.11.2001, served on the National Insurance Company; Ex.B5 is the certified copy of insurance policy of vehicle AP 9 U 6768 issued by the Oriental Insurance Company Limited, dated 07.10.1997; Ex.B6 is the copy of letter, dated 11.08.2004, from Divisional Manager, Oriental Insurance Company Ltd. New Delhi – 110 002, addressed to Smt. Ramanamma; Ex.B7 is the copy of letter, dated 01.11.2004 from D.Ramanamma, Advocate addressed to the Divisional Manager, Oriental insurance Company Ltd., Visakhapatnam; Ex.B8 is the xerox copy of referred charge sheet, proceedings of VIII Metropolitan Magistrate’s Court, Visakhapatnam, at Gajuwaka, dated 15.07.1998. 7. The main contention in the claim petition before the Tribunal is the rash and negligence of the driver of the trailer in leaving the same by attributing negligence to the deceased himself in view of the F.I.R. and the charge sheet filed against the deceased. 7. The main contention in the claim petition before the Tribunal is the rash and negligence of the driver of the trailer in leaving the same by attributing negligence to the deceased himself in view of the F.I.R. and the charge sheet filed against the deceased. The F.I.R. was lodged by the brother of the deceased who was not an eye witness. The claimants examined P.W.2, who is an eyewitness to the incident and P,W.2 was also examined by the police during the course of the investigation. Basing on the evidence of P.W.2, who deposed that the accident was caused as the trailer was negligently left in the middle of the road without any signals resulting in the accident and upon thorough consideration of the evidence of P.Ws.1 and 2 and the documentary evidence regarding the criminal proceedings, the Tribunal held that the accident was caused due to the negligence of the driver of the trailer in leaving it against the care supposed to be taken as per Section 122 of the Motor Vehicles Act, 1988. The Tribunal decided the quantum of compensation at Rs.9,97,000/- under various heads as follows: Sl. No. Head Amount 1 Loss of income Rs.9,60,000 2 Loss of estate Rs.15,000 3 Loss of consortium (exclusively payable to the 1st petitioner) Rs.20,000 4 Funeral expenses Rs.2,000 Total Rs.9,97,000 Since the deceased was stated to be a class I contractor, upon perusal of the income tax returns for the assessment year 1991-92, income tax clearance certificate for the years 1988-89 to 1990-91 and 1991-92 marked as exhibits A8 to A10 and income tax clearance certificates for the years 1992-93, 1993-94 marked as Ex. A9 and another income tax clearance certificate under Ex.A10, the Tribunal evaluated Rs.90,000/- per annum as his income. After deducting 1/3 rd out of it towards his personal expenditure, the Tribunal applied the multiplier ‘16’ and calculated the total loss of earnings at Rs.9,60,000/-. The rest of the amounts awarded are as shown above. The Tribunal awarded costs and also interest @ 9% per annum from the date of the petition till the date of deposit with joint and several liability of respondents Nos.1, 2 and 4 while dismissing the petition against the respondent No.3. 8. The rest of the amounts awarded are as shown above. The Tribunal awarded costs and also interest @ 9% per annum from the date of the petition till the date of deposit with joint and several liability of respondents Nos.1, 2 and 4 while dismissing the petition against the respondent No.3. 8. Aggrieved by the liability fastened on the respondent No.4, the appeal was preferred by the respondent No.4 / insurance company, vide M.A.C.M.A.No.2311 of 2005 and later the claimants preferred M.A.C.M.A.No.2195 of 2013 being not satisfied by the quantum of compensation awarded. 9. The contention of the appellant / insurance company is that the Tribunal failed to properly appreciate the fact that the accident occurred due to the negligence of the deceased and further, the Tribunal erroneously assessed the income of the deceased at Rs.90,000/- and further committed an error in adopting the multiplier method under Schedule II which is applicable to claim under Section 163-A of the M.V.Act, where the income of the victims is not exceeding Rs.40,000/- per annum. It is also contended that the Tribunal ought to have considered the contributory negligence of the deceased. 10. On the other hand, the claimants contended that the Tribunal erroneously deducted 1/3 rd of the income of the deceased though the number of dependants is five and the Tribunal ought to have deducted only 1/4 th of it. They further contended that they are entitled to compensation of Rs.20 lakhs. 11. It is settled law that irrespective of the proceedings on criminal side, the Tribunal has to decide the claim basing on the evidence produced before it, even regarding the negligence of any party resulting in the cause of accident. The Tribunal has exhaustively dealt with the contentions, legal aspects and the evidence in this regard and has come to a just conclusion. As per the reliable evidence of P.W.2, it is the night time and the vehicle was parked without any lights indicating its parking and the trailer is loaded with iron rods protruding out of the trailer. Further, Section 122 of the M.V.Act casts an obligation to keep indicators while leaving the vehicle in the public place. No such precautions were taken by the driver of the trailer. No other evidence of an eyewitness was placed by the respondents. Further, Section 122 of the M.V.Act casts an obligation to keep indicators while leaving the vehicle in the public place. No such precautions were taken by the driver of the trailer. No other evidence of an eyewitness was placed by the respondents. Mere F.I.R. and charge sheet cannot support the case of the respondents or demolish the case of the claimants. This Court does not see any reason to interfere with the elaborate discussion made by the Tribunal and correct observations made by reaching proper conclusions. Therefore, the contention of the appellant / insurance company in this regard is not sustainable. 12. Insofar as the quantum of compensation is concerned, the contention of the appellant / insurance company is not acceptable as the Tribunal awarded the amount basing on the evidence on record without any assumptions and presumptions. 13. Insofar as the contention of the appellants / claimants is concerned, it is to be noted that the Tribunal has committed an error in deducting 1/3 rd of the income towards personal expenses though there are five claimants and therefore, the Tribunal ought to have deducted 1/4 th of the income and the rest of the income shall be taken into account for calculating the loss of earnings. Since no amount of compensation was granted to the respondents Nos.2 to 5 for the loss of love and affection, care which can also be considered as filial and parental consortium, since the accident occurred in the year 1988, considering the value of the money by then, this Court is of the view that Rs.5,000/- can be granted to each one of them. Therefore, they are entitled to a further sum of Rs.20,000/-. 14. The claimants further contended that the Tribunal has not added any amount towards future prospects. In National Insurance Company Limited vs. Pranay Sethi and Ors., Neutral Citation: 2017 INSC 1068 , it was held at paragraph No.61 as follows: “61. In view of the aforesaid analysis, we proceed to record our conclusions: (i) The two-Judge Bench in Santosh Devi Vs. National Insurance Company Limited, AIR 2012 SC 2185 should have been well advised to refer the matter to a larger Bench as it was taking a different view than what has been stated in Sarla Verma Vs. Delhi Transport Corporation and another, AIR 2009 SC 3104 , a judgment by a coordinate Bench. National Insurance Company Limited, AIR 2012 SC 2185 should have been well advised to refer the matter to a larger Bench as it was taking a different view than what has been stated in Sarla Verma Vs. Delhi Transport Corporation and another, AIR 2009 SC 3104 , a judgment by a coordinate Bench. It is because a coordinate Bench of the same strength cannot take a contrary view than what has been held by another coordinate Bench. (ii) As Rajesh and others Vs. Rajbir Singh and others, (2013) 9 SCC 54 has not taken note of the decision in Reshma Kumari Vs. Madan Mohan and others, (2013) 9 SCC 65 , which was delivered at earlier point of time, the decision in Rajesh is not a binding precedent. (iii) While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax. (iv) In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component. (v) For determination of the multiplicand, the deduction for personal and living expenses, the tribunals and the courts shall be guided by paragraphs 30 to 32 of Sarla Verma which we have reproduced hereinbefore. (vi) The selection of multiplier shall be as indicated in the Table in Sarla Verma read with paragraph 42 of that judgment. (vii) The age of the deceased should be the basis for applying the multiplier. (viii) Reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs.15,000/-, Rs.40,000/- and Rs.15,000/- respectively. (vi) The selection of multiplier shall be as indicated in the Table in Sarla Verma read with paragraph 42 of that judgment. (vii) The age of the deceased should be the basis for applying the multiplier. (viii) Reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs.15,000/-, Rs.40,000/- and Rs.15,000/- respectively. The aforesaid amounts should be enhanced at the rate of 10% in every three years.” 15. Since the deceased was aged about 34 years and the income of the deceased is from business, as per the above decision, 40% of the established income should be added. Thus, by adding 40% of the annual income, the loss of earnings work out to Rs.90,000 +Rs.36,000/- (40% of Rs.90,000/-) = Rs.1,26,000/-. After deducting 1/3 rd towards personal expenses, the loss of earnings work out to Rs.84,000/- (Rs.1,26,000/- - Rs.42,000/-). Now, by applying the multiplier ‘16’, the compensation payable comes to Rs.13,44,000/-. (Rs.84,000/- X 16). By adding Rs.20,000/- to this amount, as discussed in paragraph No.12, the total compensation payable comes to Rs.13,64,000/-. 16. In the result, M.A.C.M.A.No.2311 of 2005 is dismissed. M.A.C.M.A.No.2195 of 2013 is allowed in part awarding a compensation of Rs.13,64,000/- to the claimants with interest as awarded by the Tribunal and costs throughout. The apportionment of the amount increased is proportionate to the apportionment ordered by the Tribunal. The claimants originally claimed a compensation of Rs.10 lakhs. The claimants are therefore, directed to deposit the court fee on the additional amount of compensation, which is now awarded and more than Rs.10 lakhs. Pending miscellaneous petitions, if any, shall stand closed.