Bangalore District Court
) A.S.Mohan Sunder vs ) C.N.Mohan Kumar on 25 May, 2016
BEFORE THE MEMBER PRL.MOTOR ACCIDENT CLAIMS
TRIBUNAL AT BANGALORE
(S.C.C.H. - 1)
DATED THIS THE 25th DAY OF MAY'2016
PRESENT : SRI H.P.SANDESH, B.A.L, ., LL.B,
MEMBER, PRL. M.A.C.T.
M.V.C.No.3736/2014
Petitioners: 1) A.S.Mohan Sunder,
S/o Late D.A.Subramani,
Aged about 57 years.
2. Lakshmi Priya S.M.,
D/o A.S.Mohan Sunder,
Aged about 24 years.
3. Lohith S.M.
S/o A.S.Mohan Sunder,
Aged about 19 years.
All are residing at No.65/5,
5th Main, 8th Cross,
S.K.Garden,
Benson Town Post,
Bangalore -46.
(By Sri B.S.Manjunath, Advocate)
-Vs-
Respondents: 1) C.N.Mohan Kumar,
S/o P.C.Nagaraju,
No.112, Kandavarapete,
Chikkaballapur Taluk & District.
(R.C.Owner of bus bearing
Reg.No.KA-40/9531)
SCCH 1 2 MVC No.3736/2014
(By Sri B.V.Srinivas, Advocate)
2. IFFCO TOKIO General Insurance
Company Limited,
No.141, V Floor,
Shanthi Tower,
East of NGEF layout,
Kasturi Nagar,
Bangalore -43.
(I.P.No.88533415 valid from 29.7.2014
to 28.07.2015)
(By Sri K.Prakash, Advocate)
*****
JUDGMENT
This petition is filed under Section 166 of the Motor Vehicles Act, 1989 seeking compensation of Rs.1,00,00,000/- for the death of Thamayandhi P., the wife of first petitioner and mother of petitioners No.2 and 3.
2. The brief facts of the case are:
It is the case of the petitioners that on 30.07.2014 at about 5.30 p.m., the deceased was riding pillion on Honda Dio Scooter bearing registration No.KA-04/EZ-9710, which was driven by her daughter.
They both were proceedings towards their house. When they reached near T.Chowdaiah road infront of Petrol Bunk, at that time, the driver SCCH 1 3 MVC No.3736/2014 of private bus bearing No.KA-40/9531 driven the same in rash and negligent manner and dashed against the scooter from behind and caused the accident and as a result the, both the rider as well as the pillion rider fell down and sustained grievous injuries. The pillion rider succumbed to the injuries on the way to Bowing Hospital.
3. It is the case of the petitioners that the deceased was hale and healthy and was aged about 50 years and was working as Inspector in Income Tax department, HMT Bhavan, Ganganagar, Bangalore and was drawing a sum of Rs.60,000/- and was contributing her entire earnings to the maintenance of her family. The deceased was recently promoted as Income Tax Officer and was eligible for additional salary of Rs.15,000/- p.m., and she was having bright future prospects and also promotional benefits in her future service.
4. It is the case of the petitioners that due to the sudden and tragic death of the deceased, the petitioners are undergoing deep mental shock, agony and untold hardship. The first respondent is the R.C. Owner of the bus bearing No. KA-40/9531 and second SCCH 1 4 MVC No.3736/2014 respondent is the insurer of the bus and they are jointly and severally liable to pay the compensation to the petitioners.
5. In pursuance of this claim petition, this Court issued notice against the respondents and they having appeared before the Court through their respective Counsel, filed written statements separately.
6. The respondent No.1 has filed written statement denying the petition averments. It is further contended that the bus was insured with the second respondent and the policy was valid as on the date of accident. This respondent has denied the date, time and manner of the accident, involvement of the vehicle, name, age, occupation and income of the deceased, relationship of the petitioners with the deceased. The compensation claimed by the petitioners is excessive and exorbitant.
7. The second respondent also filed written statement denying the petition averments. It is contended that it has not issued the policy against the alleged bus bearing No. KA-40/9531 covering the alleged period of accident and policy bearing No.88533415 issued in favour of Sri C.N.Mohan Kumar, valid from 29.7.2014 to 28.7.2015 is cancelled as VOID-AB-INITIO due to dishonour of the premium SCCH 1 5 MVC No.3736/2014 cheque for 'funds insufficient'. Hence, there is no subsisting contract between the first respondent and second respondent as there was no passing of consideration in respect of alleged contract and the respondent No.1 has not complied with the provision of Section 64VB of Insurance Act. Therefore, petition is bad for mis-joinder of unnecessary parties to the proceedings as the second respondent is an unnecessary party. Hence, the petition is liable to be dismissed against this respondent.
8. It is further contended that the situation of the alleged accident has been twisted and described as if the said bus is responsible for the alleged accident and the stated facts are far from truth. It is also contended that the rider of the Honda Dio bearing No. KA-04/EZ-9710 driven the same without the knowledge of riding, in a rash and negligent manner and without possessing valid vehicle documents and came to the wrong side of the road and dashed to the bus and the alleged accident occurred due to the sole negligence of the rider of the Honda Dio and the petition is bad for non-joinder of necessary and proper parties as the rider, owner and insurer of the motor cycle have not been made as party to the proceedings.
SCCH 1 6 MVC No.3736/2014
9. The respondent No.2 has further denied the date, time and manner of the accident, involvement of the bus in the accident, age occupation and income of the deceased, relationship of the petitioners with the deceased. The compensation claimed by the petitioners is excessive and exorbitant. Hence, prayed the Court to reject the petition.
10. In view of contentions raised by both the parties, the following issues were framed:-
1) Whether the Petitioners prove that the deceased succumbed to injuries in a Motor Vehicle Accident that occurred on 30.07.2014 at about 5.30 p.m., on T.Chowdaiah Road, in front of H.P.Petrol Bunk, Bangalore-03 within the jurisdiction of Sadashivanagar Traffic Police Station on account of rash and negligent driving of the bus bearing registration No. KA-40/9531 by its driver?
2) Whether the petitioners are entitled for compensation ? If so, how much and from whom?
3) What Order?
11. In order to prove their claim, the first petitioner is examined as PW-1, two witnesses are also examined as PW-2 and 3 and through their evidence, documents at Ex.P.1 to 31 were got marked. On the other hand, respondents have examined three witnesses as RW-1 to 3 and they have got marked Ex.R.1 to 18.
SCCH 1 7 MVC No.3736/2014
12. Heard the arguments of the Counsel for the petitioners and the respondent No.2.
13. The Counsel for the petitioners has relied upon the following judgments:
1) 2015 ACJ 921
2) 2013 ACJ 2416
3) 2012 ACJ 1307
4) 2015 ACJ 1424
14. The Counsel for the respondent No.2, along with his written arguments has relied upon the following judgments:
1) 1991 ACJ 650 (SC)
2) Un reported judgment in MFA No.3782/2005
3) 2008 AIR SCW 5298
4) Unreported judgment in RP No.472/2010
5) MANU/SC/1588/2009
6) Unreported judgment in MFA No.9795/2010
7) Notification No.235 dated 17.10.2002 issued by IRDA
8) ILR 2004 KAR 3268
15. I have given my anxious consideration to the principles laid down in the above judgments.
SCCH 1 8 MVC No.3736/2014
16. After having perused the pleadings of the parties and the evidence lead in and the having heard the arguments, my answer to the above issues are as under:
1) In the affirmative,
2) Partly in the affirmative,
3) As per final order, for the following:
REASONS
17. Issue No.1:- It is the case of the petitioners that on 30.07.2014 at about 5.30 p.m., the deceased was riding pillion on Honda Dio Scooter bearing registration No.KA-04/EZ-9710, which was driven by her daughter. They both were proceedings towards their house. When they reached near T.Chowdaiah Road in front of Petrol Bunk, at that time, the driver of private bus bearing No.KA-40/9531 driven the same in rash and negligent manner and dashed against the scooter from behind and caused the accident and as a result the, both the rider as well as the pillion rider fell down and sustained grievous injuries. The pillion rider succumbed to the injuries on the way to Bowing Hospital. Thus, it is the case of the petitioners that the accident and the resultant of the death of the deceased was on SCCH 1 9 MVC No.3736/2014 account of the rash and negligent driving of the bus No.KA.40/9531 by its driver.
18. The respondent No.1 in the statement of objections, denied the case of the petitioners in toto, whereas, the respondent No.2 in its statement of objections, specifically contended that the accident was not due to any rashness or negligence on the part of the driver of the bus, but it was on account of the rash and negligent riding of the motorcycle by the petitioner No.2, who was riding the Scooter at the time of accident.
19. In support of their case, the petitioners have examined the petitioner No.1 as PW 2 and also examined the petitioner No.2 as PW 3 and through the evidence of PW 1, FIR, Sketch, Mahazar, Inquest Report, PM Reprot and Charge Sheet has been got marked as Ex.P.1 to 6 respectively. In the evidence of PW 1 and 3, both of them have reiterated their case as has been narrated in the petition. PW 1 and 3 have been cross-examined by the Counsel for the respondents at length.
20. Though the respondent No.2 has examined one of its officers as RW 1 and the 1st respondent has been examined as RW 2, SCCH 1 10 MVC No.3736/2014 evidence of RW 1 and 2 is only with regard to he validity or otherwise of the insurance policy in respect of the bus.
21. Now, let me appreciate both oral and documentary evidence available before the Court with regard to the negligence of the driver of the bus is concerned.
22. In the cross-examination of PW 1, it is elicited that he did not witness the accident and he says that he saw the place of accident after the accident. PW 1 also admits that there will be heavy traffic on the said road. It is suggested to him that his daughter did not know riding of two wheeler and she herself caused the accident and the said suggestion has been denied by him. It is suggested to him that the accident has not occurred on account of the negligence on the part of the driver of the bus and the said suggestion has been denied by him. It is suggested to him that in collusion with the Police, a false case is foisted against the driver of the bus in order to get compensation and the said suggestion has been denied by him.
23. The petitioners have also examined PW 3, who is the rider of the two wheeler at the time of accident and in her evidence, she says that her mother came along with her as pillion rider on the two wheeler and they were proceeding from Palace Ground to SCCH 1 11 MVC No.3736/2014 S.K.Garden, observing the traffic rules and at that time, the driver of the private bus came from behind with high speed in rash and negligent manner and dashed against their vehicle and caused the accident and the accident has occurred due to the rash and negligent driving of the said bus by its driver. In the cross-examination, it is suggested to her that there will be heavy traffic, to which she volunteered that there will be a little traffic. She further volunteers that that during peak hours, there will be traffic and the width of the road is 30 feet and that there is a road divider also. It is suggested to her that both of them were talking to each other at the time of accident and the said suggestion has been denied by her. She admits that she did not notice the bus prior to the accident and the distance between the place of accident and the median is about 20 feet. It is suggested to her that the bus driver was driving the bus in a safe manner and she herself hit against the middle of the bus and the same was denied. It is suggested to her that the driver of the bus was not negligent and the accident occurred due to her negligence and the said suggestion has been denied by her.
24. On the other hand, the respondents have examined RWs 1 to 3. But none of them have spoken about the negligence and RWs 1 SCCH 1 12 MVC No.3736/2014 to 3 have given evidence with regard to the validity of the policy and regarding the bouncing of cheque and there is no serious dispute with regard to the accident and there is no rebuttal evidence as against the evidence of PW 1 and 3. However, in the cross-examination, they have admitted that the charge sheet was filed against the driver of the bus. It is suggested to RW 2 that the driver of the bus driven the same in rash and negligent manner and therefore the accident took place, to which, the witness says that he is not aware of the same. He admits that he did not witness the accident.
25. On perusal of the oral evidence of PW 1, he is not an eye- witness to the accident and PW 3 is the eyewitness to the accident, since she was riding the two-wheeler and the deceased was riding pillion. PW 3 is the daughter of the deceased and in her evidence, she says that the bus came in rash and negligent manner from behind and dashed against their two-wheeler, as a result, the accident has occurred. On perusal of the complaint, PW 3 has given the complaint and she says that she was riding Honda Dio Scooter and that she was taking her mother from Mekhri Circle towards Windsor Manner Hotel and the bus which came from Kaveri Talkies from behind her and dashed against the rear portion of their two wheeler and when her SCCH 1 13 MVC No.3736/2014 mother fell down, rear wheel of the bus ran over her mother and the complaint was given on the same day. In the cross-examination of PW 3, except making a suggestion that the accident has occurred due to her negligence, nothing is elicited from the mouth of PW 3, regarding her negligence. PW 3 categorically says that the width of the road is 30 feet and there is a road median and no doubt, it is elicited from her mouth that she did not witness the bus prior to the accident, the fact that the bus came from rear side has not been disputed and the Police after investigation in to the case, filed charge sheet against the driver of the bus. From a perusal of Ex.P.2, which is the spot sketch, it is clear that the scooter was on the left side of the road. PW 3 was proceeding ahead of the bus and the bus came from rear side and hit against the two wheeler on its rear portion and the contents of Ex.P.2 Sketch has not been disputed and the Respondent's Counsel also not seriously argued regarding the negligence and only concentrated with regard to the cancellation of policy and issuance of fresh policy and for having taken note of both oral and documentary evidence placed on record by the petitioner and further that the driver of the bus has not been examined before the Court, who is the right person to speak with regard to the negligence on the part of PW 3, I SCCH 1 14 MVC No.3736/2014 am of the opinion that the petitioners have successfully established that the accident has occurred purely on account of the rash and negligent driving of the bus by its driver and in the accident, deceased died on the spot. Accordingly, I answer issue No.1 in the affirmative.
26. Issue No.2:- The petitioners have contended that they have lost the earning member of the family and the deceased was working in the Income Tax Department as an Inspector and she was drawing a salary of Rs.54,030/-per month and the deceased was spending the entire salary for the maintenance of the family and that they were solely depending on the income of the deceased and that they have also spent Rs.50,000/- towards funeral expenses and transportation. In support of their case, they have also produced the Salary Certificate as Ex.P.7, IT Returns for 3 years pertaining to the deceased as Ex.P.8 to 10. Petitioners' have also relied upon Ex.P.11 Bank Statement and Aadhaar Card of the deceased as Ex.P.12. Pan Card of the deceased as Ex.P.17. SSLC Marks Card as Ex.P.18, Typewriting and Stenography Marks Card as Ex.P.20 to 22.
27. In the cross-examination of PW 1, it is elicited that he is doing business and is not an income tax assessee and he gets Rs.15,000/- as income from the business per month and also he admits SCCH 1 15 MVC No.3736/2014 that he gets an income of rs.22,000/- as pension per month through bank and he is having two children and his daughter is also working in Bank of India and also admits that his son got compassionate job and he is getting salary around Rs.15,000/- per month. It is suggested to him that they were not dependant on the income of the deceased and he denies the same.
28. The daughter of the deceased, who has been examined as PW 3, also admits that she is working in Bank of India and gets salary of Rs.15,000/- per month and the petitioners' have also examined PW 2, the Administrative Officer in the Office of the Additional Commissioner of Income Tax and he has spoken with regard to the salary certificate and deduction of TDS and attested copy of the Last Pay Certificate, which are marked as Ex.P.24 to P.28. In the cross- examination of PW 2, it is elicited that they used to deduct the tax and making the remaining payment and also admits that they were crediting the salary to the account of the employee and they maintain seniority list and he can produce the seniority list before the Court. He further admits that during 2014, they have deduced Rs.4,400/- towards income tax as per Ex.P.26. It is suggested to him that the deceased was not getting salary of Rs.54,030/- and the said suggestion has been SCCH 1 16 MVC No.3736/2014 denied. He also admits that the son of the deceased has been appointed on compassionate ground and he does not know how much pension benefit was given to the dependants and her son was appointed as notice server. He admits that her son is getting a salary around Rs.25,000/- per month.
29. Now, let me appreciate both oral and documentary evidence with regard to the quantum of compensation to be awarded to the petitioners on account of the death of the deceased in the accident.
30. A perusal of Ex.P.12 to 15, which are the Aadhaar Cards of the petitioners and the deceased, reveal the relationship of the petitioners with the deceased, in as much as the first petitioner is the husband, whereas, the petitioner No.2 and 3 are their daughter and son. Though the respondents No.1 and 2 have denied the relationship of the petitioners with the deceased, but Ex.P.12 to 15, as discussed above, reveal the relationship of the petitioners with the deceased.
31. PW 1 husband of the deceased categorically admits that he is getting an income of Rs.15,000-/- from his business and he also gets pension of Rs.22,000/- through bank and his daughter is also SCCH 1 17 MVC No.3736/2014 working in Indian Bank and she is getting a salary of Rs.14,000/- per month and the daughter, who has been examined as PW 3, admits that she is getting a salary of Rs.15,000/- per month. It is further admitted by PW 1 that he is doing business and getting monthly income of Rs.15,000/-. PW 1 further admits that his son was appointed on compassionate grounds in Income Tax Department as Notice Server after the death of his wife and getting a gross salary of Rs.25,000/- per month and PW 3 says that she is employed in a bank and getting a salary of Rs.15,000/- per month. Hence, it is clear that petitioners are having their own income and were not dependant on the income of the deceased. But, the fact remains here that son of the deceased was appointed on compassionate grounds, only upon the death of the deceased in the accident and thus, the same will not disentitle the petitioners to claim compensation. I have already pointed out that the appointment of the son of the deceased is subsequent to the death of the deceased and therefore, such being the circumstances, this Court has to take note of the fact that as on the date of the accident, son of the deceased was unemployed and the salary payable to the son of the deceased is towards the duty discharged by him.
SCCH 1 18 MVC No.3736/2014
32. Thus, it is the case of the petitioners that the deceased was running 50 years at the time of accident and working as Inspector in the Income Tax Department and being an Income Tax Assessee, the deceased was having a monthly income of Rs.60,000/- per month and maintaining the family and she was the only earning member in the family. But as discussed above, the petitioners have produced Ex.P.17, PAN Card of the Deceased, Ex.P.18 SSLC Marks Card. A perusal of both these documents reveal that the deceased was born on 31.03.1964 and the accident having occurred on 30.07.2014, she was running 51 years at the time of accident and thereby, the multiplier applicable to the case on hand is 11.
33. So far as the avocation and income of the deceased is concerned, apart from the evidence of PW 2, who is working as Administrative Officer, in the office where the deceased was working, who has reiterated the case of the petitioners that at the time of accident, the deceased was working as Inspector in the Income Tax Department, however, the income of the deceased as per Ex.P.7 Salary Certificate was Rs.54,030/- for the month of July'2014. Further, as admitted by PW 2 in his cross-examination, as per Ex.P.26, Rs.4,400/- was deducted towards income tax. Further, as per SCCH 1 19 MVC No.3736/2014 Ex.P.7 Salary Certificate, Rs.200/- was deducted towards professional tax and thus, after deducting the income tax of Rs.4,400/- and Rs.200/- towards professional tax from out of the gross salary, it can be safely said that the deceased had a net income of Rs.49,430/- per month. Since the deceased was working in a government department and Ex.P.7 and Ex.P.8 to 10 are public documents, the contents of which cannot be doubted. Accordingly, the income of the deceased, after deduction of tax, both income and profession, is taken at Rs.49,430/- per month.
34. As discussed above, petitioner was doing business and getting income of Rs.15,000/- per month apart from pension of Rs.22,000/-. Further, petitioner No.2 being the daughter, is employed in a bank and getting income of Rs.15,000/- per month. Further, the petitioner No.3 being the son, was major ie., 19 years at the time of accident. He joined the Income Tax Department on compassionate ground upon the death of his mother. Thus, all that can be said is that none of the petitioners were dependant on the income of the deceased. However, in the judgment reported in ILR 2004 KAR 3268 (A.Manavalagan Vs A.Krishnamurthy and others), relied upon by the Counsel for the respondent No.2, facts of which are similar to the case SCCH 1 20 MVC No.3736/2014 on hand, the Division Bench of the High Court of Karnataka has held in para 19(iv) as follows:
"(iv) If the deceased is survived by an educated employed wife earning an amount almost equal to that of her husband and if each was maintaining a separate establishment, the question of 'Loss of dependency' may not arise. Each will be spending from his/her earning towards his living and personal expenses. Even if both pool their income and spend from the common income pool, the position will be the same. In such a case, the amount spent for personal and living expenses by each souse from his/her income will be comparatively higher, that is three fourth of his/her income. Each would be saving only the balance that is one fourth (which may be pooled or maintained separately). If the saving is taken as one fourth (that is 25%), the loss to the estate would be Rs.2,250/- per month or Rs.27,000/- per annum. By adopting the multiplier of 14, the loss to estate will be Rs.3,78,000/-".
35. Since the principle laid down in the above judgment is applicable to the case on hand and since the petitioners failed to make out a case contrary to the same, by applying the principles laid down in the above judgment, the petitioners are held to be entitled to compensation under the head loss to estate will be as follows:
SCCH 1 21 MVC No.3736/2014
36. Income of the deceased is assessed at Rs.49,430/-. In view of the principles liad down in the judgment reported in 2013 ACJ 1403 (Rajesh Vs. Rajbir Singh), the Apex Court held that even if a person is self employed, loss of future prospects has to be taken into consideration. However, in the case on hand, the deceased was working in a government department and still 9 years of service left and hence, as the deceased was aged 51 years at the time of accident and therefore, 15%, from out of her income, has to be taken as loss of future prospects, which works out to Rs.7,414.50/- and thus the total (Rs.49,430 + 7414.50) works out to Rs.56,844.50. 25% of which comes to Rs.14,211.12 (rounded off to Rs.14,211/-). Annually, the same works out to Rs.1,70,532/- and if the same is multiplied by 11 mutliplier, having regard to the age of the deceased being 51 years, it works out to Rs.18,75,852/-, to which the petitioners are entitled to under the loss of estate.
37. The Apex Court, in the case reported in 2013 ACJ 5800 (Sanobanu Nazirbhai Mirza Vs. Ahmedabad Municipal Transport Service) and also in the recent judgment reported in AIR 2014 SUPREME COURT 706 (Puttamma Vs. Narayana Reddy) awarded SCCH 1 22 MVC No.3736/2014 Rs.1,00,000/- as compensation to the family members (children and family members other than wife or husband) for loss of love, Rs.50,000/- towards loss of love and affection to the husband of the deceased and Rs.10,000/- towards cost incurred on account of funeral and ritual expenses. In this case also, since the deceased has left behind her daughter and son, I deem it proper to award Rs.1,00,000/- as compensation to the family members (children and family members other than wife/husband) for loss of love and affection, deprivation of protection, social security etc., Rs.50,000/- to the petitioner No.1 who is the husband of the deceased for loss of love and affection and Rs.10,000/- towards cost incurred on account of funeral and ritual expenses.
38. The details of compensation I propose to award are as under:
S Head of Compensation Amount/
l.No. Rs
1 Loss of estate 18,75,85
2.00
2 Compensation to the 1,00,000
family members (children and .00
family members other than
wife) for loss of love and
affection, deprivation of
protection, social security etc.
3 Compensation to the 50,000.0
husband for loss of love and 0
SCCH 1 23 MVC No.3736/2014
affection, deprivation of
protection, social security etc.
4 Cost incurred on account 10,000.0
of funeral and ritual expenses 0
Total 20,35,85
2.00
39. As far as apportion of the compensation amount amongst the petitioners are concerned, petitioner No.1 being the husband is entitled to 40% and the petitioner No.2 and 3 being the children are entitled to 30% each.
40. As regards the liability to be fixed on the respondents, as discussed above, the respondent No.1 is the owner and the respondent No.2 is the insurer of the vehicle, which fact is not disputed and even the respondent No.2 has admitted to have issued an Insurance Policy in respect of the vehicle in the name of the respondent No.1. However, it is contended by respondent No.2 that the alleged insurance policy issued in favour of Sri C.N.Mohan Kumar, which was valid from 29.07.2014 to 28.07.2015 is cancelled as void-ab- initio due to dishonour of premium cheque for 'funds insufficient' and hence, there was no passing of consideration in respect of the alleged contract and thereby the respondent has not complied with Section SCCH 1 24 MVC No.3736/2014 64VB of the Insurance Act. It is also contended that the policy was issued subject to realization of cheque and the second respondent had sent intimation to the 1st respondent regarding cancellation of policy and the first respondent had taken the contention in his evidence that he had taken the alleged policy by paying the cash, by taking advantage that the mode of payment is mentioned as 'cash' in the alleged policy instead of 'cheque'. It is further contended that the first respondent had taken the fresh policy valid from 09.09.2014 to 08.09.2015 and the said policy was transferred to Sri Y.N.Srinivas while transferring the vehicle to him and this clearly shows that the first respondent had taken false contention to avoid liability and hence, the second respondent is absolved from indemnifying the respondent No.1 as the consideration was not passed in respect of the contract.
41. In support of his contentions, the Counsel for the respondent No.2 has relied upon the following judgments:
1) 1991 ACJ 650(United India Insurance Co., Ltd., Vs. Ayeb Mohammed and others), wherein, it is held as under:
" Motor insurance-Liability of Insurance Company - Cover note - Insurance company issued a cover note insuring the vehicle the SCCH 1 25 MVC No.3736/2014 premium of which was remitted by a cheque - cheque was dishonoured and the insurance company informed this fact to the registering authority and the insured vehicle met with an accident - Despite the plea of Insurance Company that the cheque had bounced and in the absence of payment the cover note had become ineffective - the Tribunal awarded a sum of Rs.15,000/- holding the insurance company liable - High Court upheld the award on the footing that insurance company had issued a cover note undertaking the risk and had failed to take steps to cancel the cover note - Supreme Court held that the High Court was not right in holding that insurance company had failed to take steps for cancellation of cover note and in the absence of steps for cancellation of the cover note, the risk would be subsisting; the fact of dishonour of the cheque is within the knowledge of the insured and no special notice to the insured is required; liability of insurance company ceases."
2) Unreported judgment in MFA No.3782/2005, wherein it is held as under:
"Ex.R.7 is the Policy which was cancelled on 14.10.2003. Subsequent to cancellation of this policy, the insured by paying premium in cash obtained another policy as per Ex.R.11, which came to be effective from 11.15 am on 26.12.2003 and thus, as on the date of accident, vehicle involved in the accident was not insured with the insurance company and the policy was not in force" and the High Court has relied upon the judgment referred at Sl.No.1 above.
SCCH 1 26 MVC No.3736/2014
3) 2008 AIR SWC 5298 (National Insurance Co., Ltd., vs. Yellamma and another), wherein it is held as under:-
" Motor Vehicles Act (59 of 1988), S.147 - Insurance Act (4 of 1938), S.64VB - compensation - Liability of insurer - Owner of vehicle after getting vehicle insured issued third party cheque towards payment of premium - Development Officer of insurer by inadvertence issued a cover note - When said mistake came to his notice owner was asked to pay amount of premium - Amount was not tendered and instead owner returned original cover note and took back cheque - As a result cover note was cancelled - It could be said that no privity of contract came into being between owner and insurer
- Insurer not liable to pay compensation for accident occurred -
Supreme Court under Art.142 directed insurer to make payment and to recover it from owner."
4) MANU/SC/1588/2009 ( National Insurance Co., Ltd., Vs. Parvathneni and another), wherein, at para 8, it is held as under:-
"Insurance Company has no liability to pay at all, then, in our opinion, it cannot be compelled by order of the Court in exercise of its jurisdiction under Article 142 of the Constitution of India to pay the compensation amount and later on recover it from the owner of the vehicle". Further held that "In our view, Article 142 of the Constitution of India does not cover such type of cases. When such a person has no liability to pay at all how can it be compelled to pay? It SCCH 1 27 MVC No.3736/2014 may take years for the insurance company to recover the amount from the owner of the vehicle, and it is also possible that for some reason the recovery may not be possible at all".
5) Un-reported judgment in MFA No.9795/2010(MV) - (Tata AIG General Insurance Co., Ltd., vs. Balaguruvaiah and others), wherein the High Court of Karnataka, in para 11, 12 and 13 has held as under:
"11........ The cancellation of policy referred to under section 149(1) of the M.V.Act, refers to cancellation of policy under section 149(2)(b) of the MV Act, 1988 and not to cancellation of policy under section 64VB of the Insurance Act, 1938. Cancellation of policy can be done if the policy was obtained by non disclosure of a material fact or by representation of fact which was false in some material particulars. In the case on hand, Insurance Policy has been cancelled for dishonour of cheque issued towards payment of premium. The contract is without consideration".
42. On the other hand, the Counsel for the petitioners' in his arguments, vehemently contended that the policy itself discloses that the policy was obtained by making payment by cash and cheques are not issued and the cheque issued to the agent was misused by the company and there was no loan transaction between the agent and the owner and hence, the Insurance Company is liable to pay SCCH 1 28 MVC No.3736/2014 compensation. In support of his contention, the Counsel for the petitioners has relied upon the following judgments:
1) 2015 ACJ 921 ( Thyagaraj Vs Siddamma and another), wherein the High Court held that "the Insurance Company is required to send communication in registered post and cancellation of policy is not communicated properly to the insured and the insurance company may recover the cheque amount from the insured in accordance with law".
2) 2013 ACJ 2416 (National Insurance Co., Ltd., Balkar Ram and others), wherein it is held that "Cheque issued towards premium was dishonoured and insurance company cancelled the policy.
Insurance Company disputes its liability on the ground that the cheque was dishonoured before the date of accident and policy could not be held to be valid on that date - Intimation regarding dishonour of cheque and cancellation of policy was communicated to the insured after the date of accident. By following the judgment in 2012 ACJ 1307 (SC) ( United India Insurance Co., Ltd., Vs Laxmamma), it is held that the Insurance Company is liable".
3) 2012 ACJ 1307 (United India Insurance Co., Ltd., Vs Laxmamma and others), wherein the Apex Court held that "Cheque issued towards premium was dishonoured and insurance company cancelled the policy but in the meantime vehicle met with accident- Whether insurance company is liable to satisfy the award passed in favour of claimants - Held - Yes - cancellation of policy was done after the accident. Insurance company may prosecute its remedy to recover the amount paid to the claimants from the insured".
SCCH 1 29 MVC No.3736/2014
4) 2015 ACJ 1424 ( National Insurance Co., Ltd., Vs Nishi Bala Roy and others), wherein it is held as under:
"Cheque issued towards premium was dishonoured and insurance company cancelled policy under intimation to owner of vehicle - Insurance company contended that a letter regarding cancellation of policy was sent through registered post to the insured but it did not produce the acknowledgement of the same. Cancellation of policy not intimated to the RTO. Whether cancellation of policy has come into effect and insurance company is exempted from liability to third party - Held - No, insurance company produced valid documents to show that cheque was dishonoured, however without valid proof of communication of cancellation of policy, the insurance company cannot avoid its liability".
43. The respondent No.1, the owner of the vehicle, in an attempt to show that the vehicle was validly covered by an insurance policy as on the date of the accident, has examined RW 3 - Y.N.Srinivas and the evidence of RW 3 goes to show that he has purchased the bus on 9.6.2015 from the respondent No.1 and that there was a valid insurance on the date of the purchase and he has given the original insurance policy to his Counsel covering the date of purchase and subsequent, he has renewed the policy and the same is also with his Counsel. RW 3 has produced the Transfer Policy Copy SCCH 1 30 MVC No.3736/2014 and the same is marked as Ex.R.16 and he says that he has taken the Policy from the respondent No.2 on 9.9.2015 and the same is valid till 8.9.2016.
44. RW 3 has been cross-examined by the Counsel for the petitioner and in his cross-examination, RW 3 says that except Ex.R.16, he has not produced any document to show that the vehicle was transferred to hi name. He admits that he has not produced the copy of the application given to the insurance company for transfer of the policy.
45. Now, let me appreciate the facts of the case with regard to the liability of indemnifying the insured, keeping in view the principles laid down in the judgment referred supra by the counsel for the petitioners and the respondent No.2.
46. Admittedly, the accident has occurred on 30.07.2014 and the policy was cancelled on 05.09.2014 after the accident. On perusal of the policy, it is mentioned that payment by way of cash and on the other hand, it is the contention of the petitioner and owner and there was a loan transaction between the owner and agent and the cheque given by owner was misused by the insurance company and in order to substantiate the same, there is no material before the Court. The SCCH 1 31 MVC No.3736/2014 petitioners' Counsel admitted in his arguments that the policy was in force, however, the policy was cancelled subsequent to the accident, that too after one month of the accident and not prior to the accident. The contention of the respondent No.2 that fresh policy was taken will not exonerate the liability of the insurance company and fresh policy was taken on 09.09.2014. The respondent No.1-owner has also taken the contention that after 29 days, cheque was presented, that too after filing of the case and thereafter, cancelled the policy and in the cross- examination of RW 1, he categorically admits the same and Ex.R.17 and R.18 are marked. On perusal of Ex.R.17 and 18, policy was issued on 06.05.2013 and the same was valid till 05.05.2014 as per Ex.R.17 and as per Ex.R.18, the same was issued on 29.07.2013 and it was valid till 28.07.2014 and these polices does not cover the date of accident and hence, the respondent No.2 is liable to indemnify the respondent No.1.
47. On the other hand, the counsel for the respondent No.2, in his arguments, vehemently contended that the notice is sent to the owner and a fresh policy was taken on 09.09.2014 and though contended that the cheque was issued in favor of an agent for other transaction and either owner and the petitioner have not summoned SCCH 1 32 MVC No.3736/2014 the said agent and examined before the Court and there is no pleading regarding the financial transaction between the agent and the owner and the respondent No.1 has not given any reply contending that there was separate transaction and the vehicle was also transferred after the accident and no intimation and subsequent owner is summoned and examined before the Court.
48. I have already pointed out that the accident has taken place on 30.07.2014 and the policy was cancelled on 05.09.2014 and fresh policy was issued on 09.09.2014 and the counsel appearing for the respondent No.2 has relied upon the judgment of the Supreme Court pertaining to the year 1991, un reported judgment of the year 2007, 2008 and 2010 and these judgments are earlier to the recent judgment in the case of National Insurance Company Ltd., Vs Balkar Ram and others, 2013 ACJ 2416, wherein it is held that intimation regarding dishonour of cheque and cancellation of policy was communicated to the insured after the date of accident, whether the insurance company is liable - Held - Yes and the Apex Court in the case reported in 2012 ACJ 1307 (United India Insurance Co, Ltd., Vs Laxmamma and others) held that the Insurance Company has to satisfy the award passed in favour of claimants as the cancellation of policy was done SCCH 1 33 MVC No.3736/2014 after the accident and the insurance company may prosecute its remedy to recover the amount paid to the claimants from the insured and specifically held that the liability of the authorized insurer to indemnify third parties in respect of the liability which that policy covered subsisting and it has to satisfy the award of compensation by reason of the provision of Section 147(5) and 149(1) of the MV Act, unless the policy of Insurance is cancelled by the authorized insurer and intimation of such cancellation has reached the insured before the accident and in the case on hand also, the accident occurred on 30.07.2014 and the insurance company has taken steps only after the accident and no doubt, the owner has taken a fresh policy on 09.09.2014 and the recent judgment of the Apex Court prevails over the earlier judgments and hence, the principle laid down in the recent judgment has to be taken in to consideration. Thus, as discussed above, since the cancellation of the policy was done after the accident and communication was also done after the accident, I am of the opinion that the Insurance Company is liable to indemnify the respondent No.1 and pay the compensation to the petitioners. However, the insurer shall be at liberty to prosecute its remedy to recover the amount paid to the claimants from the insured.
SCCH 1 34 MVC No.3736/2014
49. So far as awarding interest on the compensation amount is concerned, in a case reported in (2011) 4 SCC 481 : (AIR 2012 SC
100) (Municipal Council of Delhi Vs. Association of Victims of Uphaar Tragedy), the Supreme Court has held that the Court has to take into account the rate of interest of the nationalized bank and the present day cost of living and thereby awarded, interest on the compensation amount at 9% p.a. I have no reasons to deviate from the said view of the Apex Court. Accordingly, interest on compensation amount is awarded at 9% p.a.
50. In the result, I pass the following:
ORDER The petition filed by the petitioners is allowed in part.
The petitioners are entitled for total compensation of Rs.20,35,852/- from the respondents No.1 and 2 jointly and severally along with interest at 9% p.a., from the date of petition till realisation and the respondent No.2 being the insurer, shall indemnify the respondent No.1 and and pay or deposit the compensation amount within 2 months from the date of this order.
SCCH 1 35 MVC No.3736/2014 Compensation amount is apportioned amongst the petitioners as under:-
Petitioner No.1 - Husband - 40% Petitioner No.2 - Daughter - 30% Petitioner No.3 - Son - 30% Out of the compensation amount so apportioned, 50% with proportionate interest is ordered to be invested in high yielding fixed deposit in the name of the respective petitioner's in any of the nationalized or scheduled bank of their choice for a period of 5 years. Remaining amount with proportionate interest is ordered to be released to them.
Advocate's fee is fixed at Rs.1,000/-.
Draw an award accordingly.
(Dictated to the Judgment Writer, transcription thereof, corrected, signed and then pronounced by me in the open court dated this the 25th day of May'2016) (H.P.SANDESH) Member, Prl. M.A.C.T. Bangalore ANNEXURE Witnesses examined on behalf of the petitioners:
P.W.1 : A.S.Mohan Sunder
P.W.2 : V.Sathyanarayana
P.W.3 : Lakshmipriya S.K.,
Witnesses examined on behalf of the respondents -
R.W.1 : Girisha M.,
R.W.2 : Mohan Kumar C.N.,
SCCH 1 36 MVC No.3736/2014
R.W.3 : Y.N.Srinivas
Documents marked on behalf of the petitioners:
Ex.P-1 : FIR
Ex.P-2 : Sketch
Ex.P-3 : Mahazar
Ex.P-4 : Inquest report
Ex.P-5 : PM report
Ex.P-6 : Chargesheet
Ex.P-7 : Salary Certificate
Ex.P-8 to 10 : IT returns (3 in nos.)
Ex.P-11 : Bank statement
Ex.P.12 Notarised copy of Aadhaar card (original compared)
Ex.P.3 Notarised copy of Aadhaar card of my daughter(original
compared)
Ex.P.14 Notarised copy of Aadhaar card of my son (original
compared)
Ex.P.15 Notarised copy of election ID card of my wife (original
compared)
Ex.P16 Notarised copy of my election ID card (original
compared)
Ex.P17 Notarised copy of PAN Card of deceased (original
compared)
Ex.P.18 SSLC marks card
Ex.P.19 & 20 Marks card of board of technical examination
Ex.p.21 Typing marks card
Ex.P.22 Shorthand marks card
Ex.P-23 : Authorisation Letter
Ex.P-24 : Attested copy of service register of the deceased
Ex.P-25 : Certificate regarding non maintenance of attendance
Ex.P-26 : 6 Pay slips of the deceased
SCCH 1 37 MVC No.3736/2014
Ex.P-27 : Form No.16 for the year 2013-2014 and 2014-2015
Ex.P-28 : Attested copy of the last pay certificate
Ex.P.29: Notarised copy of DL
Ex.P.30: Certificate issued by Income Tax Department
Ex.P.31: Copy of the Policy
List of documents marked for the respondents Ex.R-1 : Office copy of Letter sent to the owner of the bus Ex.R-2 & 3 2 Postal Receipts Ex.R-4 & 5 2 Postal Acknowledgements Ex.R.6 Cheque issued by respondent No.1 Ex.R.7 Bank Endorsement Ex.R.8 Endorsement for cancellation of policy Ex.R.9 Policy copy dated 29.07.2013 Ex.R.10 Policy Copy dated 10.09.2014 Ex.R.11 True copy of excel sheet for having received the cheque Ex.R-12 : Policy copy Ex.R-13 : Notarised copy of Permit (original compared) Ex.R.14: Notarised copy of pass book Ex.R.15: Copy of Transfer of insurance Ex.R.16: Transfer Policy Copy Ex.R.17 & Policy Copy6 ( in nos) 18:
(H.P.SANDESH) Member, Prl. M.A.C.T. Bangalore