Delhi District Court
Anju Devi (Dar) vs Saieem (348/17 Slc) on 2 June, 2025
IN THE COURT OF MS. SHELLY ARORA
DISTRICT JUDGE AND ADDITIONAL SESSIONS JUDGE
PO MACT (SE), SAKET COURTS : NEW DELHI
MACT No.893/2017
FIR No.348/2017
PS : SLC
U/s 279/304A IPC 146/196 MV Act
CNR NO. DLSE01-008602-2017
Anju Devi & Ors. Vs. Shamim & Ors.
1.Anju Devi (Wife of deceased)
2. Priya Mishra (Daughter of deceased)
3. Raj Mishra (Minor Son of deceased)
4. Prem Kumar Mishra (Minor Son of deceased)
5. Vidhyadhar Mishra (Father of deceased)
6. Israwati (Mother of deceased)
All R/o A-58/3/7, Gali no. 1,
A-Block, Khajoori Khas, Delhi.
Permanent Address:
Village Newada Barauna (Janghai)
PS- Saraimamrez,
Distt. Allahabad, Uttar Pradesh.
..Claimants
Versus
1. Shaieem
S/o Jamil
R/o Village Ratol, PS Khekra,
Distt. Baghpat, Uttar Pradesh
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 1 of 48
(Driver of Truck/ Trailor bearing Reg. No. UP 17T 9989)
2. Lalit Khanduja
S/o Mukund Lal
R/o B/387, Shastri Nagar
Ghaziabad, Uttar Pradesh.
(Owner of Truck/ Trailor bearing Reg. No. UP 17T 9989)
3. Oriental Insurance Company Ltd.
A-25/27, Asaf Ali Road,
New Delhi-110002
(Insurer of Truck/ Trailor bearing Reg. No. UP 17T 9989)
Respondents
Date of accident : 13.09.2017
Date of filing of DAR : 17.11.2017
Date of Decision : 02.06.2025
AWARD
1. DAR
1(a). Detailed Accident Report (hereinafter referred as DAR)
was filed by ASI Onkar Singh on 17.11.2017 which is being
treated as Claim Petition under Section 166 (1) read with
Section 166 (4) MV Act. It pertains to alleged accident of victim
Late Sh. Suresh Mishra @ Suresh Chandra Mishra (hereinafter
referred as deceased), by Vehicle no. UP 17T 9989 (hereinafter
referred as offending vehicle), owned by Sh. Lalit Khanduja
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 2 of 48
(hereinafter referred as R-1), driven by Sh. Shaeem (hereinafter
referred as R-2) and insured with M/s Oriental Insurance
Company Ltd (hereinafter referred as R-3).
2. Brief Facts:
2(a) Preliminary information regarding accident in question
was received at PS Sun Light Colony recorded vide DD no. 3PP
& 04 PP, dated 13.09.2017, upon receipt of which, IO SI Ram
Kishore along with Ct. Arun proceeded to spot of accident at
Yamuna Bridge, near Pole No.5, NH-24 (on the road coming
from Akshardham) where they found a fourteen wheel trolla
with Registration No. UP 17T 9989 in the front and a TSR
bearing Reg. No. DL 1RP 5413 on its back in accidental
condition. It was observed that TSR was badly damaged from
the front side whereas there were iron plates kept in the cargo
area of trolla protruding the main body by 3-4 feet. It was also
noticed that the the body of the trolla was not equipped with any
backlight and its parking light was not put on.
2(b) In the meanwhile, SI Ram Kishore rushed to LBS
Hospital, Khichdipur upon receipt of DD no. 07 PP from HC
Pradeep (leaving Ct. Arun at the spot of accident), where he
received MLCs (013272 till 013275) pertaining to four injured
persons with the remarks that they had already left for treatment
to an unknown hospital whereas MLC no.013276 was received
for a brought dead victim. No eye witness was found in the
hospital or at the spot.
2(c) FIR was registered under relevant provisions of law. Both
the vehicles were seized and taken into police possession. Notice
u/s 133 MV Act was served upon the TSR owner as well as the
Trolla owner. Statement of witnesses were recorded u/s 161
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Cr.PC. Driver of Trolla was produced by the owner in the police
station. Post Mortem examination of the deceased was got
conducted and the body was handed over to his relatives. The
Insurance Policy of Trolla was not found valid during the
investigation. Driver of Trolla refused to join the Test
Identification Parade proceedings during investigation.
Statement of PCR caller was recorded. Mechanical Inspection
of both the vehicles were got conducted. Upon conclusion of
investigation, Respondent No.1/ driver of Trolla was charge
sheeted for causing death/ injuring victims due to rash and
negligent driving of offending vehicle on a public way. DAR
was also filed by Investigating Officer pertaining to injured
persons namely Ms. Shamia, Ms. Amrin, Ms. Muskan and Mr.
Arif and in respect of death of Late Sh. Suresh Chandra Mishra.
2(d). Subsequently, Claim Petition was also filed by LRs of
deceased Late Sh. Suresh Chandra Mishra on 06.12.2017 which
was directed to be tagged along with DAR.
3. Reply:
3(a). All the respondents appeared on the date of filing of DAR
and subsequently, filed their reply respectively.
3(b). In WS filed on behalf of R-1/ driver of offending Trolla, it
is stated that he was holding a valid DL and the offending
vehicle was duly insured. It is clarified that a policy of insurance
was issued by authorised insurer upon receipt of cheque bearing
no. 2250001219 dated 21.06.2017 towards the premium which
was dishonoured and the policy was cancelled by the insurer,
which was not intimated to the insured prior to the accident. It is
further stated that the vehicle was stationed on the left side of
the road and the TSR had hit Trolla from the back side, even
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though, parking light of the standing truck was on but the driver
of TSR drove in a rash and negligent manner and rammed into
the trolla. R-2 also filed WS on the lines of R-1 contending that
the vehicle was duly insured and therefore the entire liability
would fall on the insurance company.
3(c). In WS filed on behalf of insurance company, it is stated
that the insurance policy bearing no. 254003/31/2018/575 was
cancelled on 03.07.2017 on account of dishonour of cheque
bearing no. 003937 dated 21.06.2017 drawn upon Union Bank
of India due to insufficient funds in their account. It is stated that
the owner / insured was duly intimated about the cancellation of
the policy through a letter / correspondence addressed to them
vide a registered post therefore, the contract of insurance
became void ab initio for want of consideration in this matter. It
is stated that the aforesaid insurance policy was not in force as
on the date of accident as the policy was already cancelled much
prior to the accident and therefore, insurance company neither
owes any contractual nor statutory liability to indemnify any
third party liability arising out of use of such vehicle. It is also
pointed out that the R-1 has already been charge sheeted for
driving the vehicle without insurance and therefore, insurance
company must be absolved entirely of any liability towards the
claimants. Counsel for the insurance company relied upon case
of United India Insurance Company Limited Vs. Laxmamma &
Ors (2012) 5 SCC 234 in support of its assertion.
3(d). Considering the assertion made by Insurance Company,
this case was treated as one without insurance which is why
driver and owner of the offending Trolla were directed vide
order dated 19.01.2018 as to show cause as to why they should
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not be directed to furnish security deposit to satisfy the award.
Vide order dated 03.02.2018, they were directed to furnish FDR
in the sum of Rs. 8 lakhs noting that there were four injuries and
one death in the matter. The directions were issued for auction of
the offending vehicle vide order dated 26.04.2018 as FDR was
not furnished despite specific directions. An Application
supported with FDR of Rs. 10 lakhs was filed seeking stay of
auction proceedings by counsel for the owner/ R-2 which was
allowed vide order dated 12.07.2018.
4. Issues:
4(a) Issues were framed vide order dated 26.04.2018:
1. Whether the Victim Sh. Suresh Mishra suffered
fatal injury and Ms. Shamia, Ms. Afreen, Ms.
Muskan and Sh. Aarif suffered injuries in a road
traffic accident dated 13.09.2017 involving vehicle
bearing Reg. no. UP 17T 9989 driven by R-1 and
owned by R-2 (not insured) due to rash and
negligent driving of R-1? OPP
2. Whether the claimants are entitled to any
compensation, if so, to what extent and from
whom?OPP
3. Relief.
5. Evidence:
5(a) Matter was then listed for petitioner evidence. PW-1 Smt.
Anju Devi W/o deceased tendered her evidentiary affidavit as
Ex.PW1/A. She also relied upon following documents:
(i) Ex.PW1/1- Photographs of the petitioners.
(ii) Ex.PW1/2 (OSR)- Election I Card of the deceased Sh.
Suresh Mishra
(iii) Mark A- Copy of Driving License PSV Drivers Badge
(iv) Ex.PW1/4 -High School Mark Sheet of the deceased
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(v) Ex.PW1/5- Receipt of Shamshan Ghat
(vi) Ex.PW1/6 - FIR bearing No. 0348/2017
(vii) Ex.PW1/7 - Aadhar Card of all the petitioners.
(viii) Ex.PW1/8- Certified copy of petition bearing MACT no.
1/2018.
5(b) PW-1 was cross examined by counsel for Insurance
Company as well as counsel for R-1 & 2.
5(c) PW-2 Muskan, who was stated to be eye witness to the
present accident, was examined as summoned witness and
deposed about the mode and manner of the accident. She was
cross examined by counsel for Insurance Company.
5(d) Ms. Amreen tendered her evidentiary affidavit as
Ex.PW2/A. Her cross examination was deferred however, she
was never cross examined and as such her examination in chief
cannot be read in this matter being incomplete.
5(e) Petitioner Evidence was accordingly closed. Matter was
then listed for respondent evidence.
5(f) R-1/ Mr. Saieem was examined as R1W1 who tendered
his evidentiary affidavit as Ex.R1W1/A. He was cross examined
by counsel for claimant as well as counsel for insurance
company.
5(g) R-2/ Sh. Lalit Khanduja tendered his evidentiary affidavit
as R2W1. He relied upon original insurance policy as
Ex.R2W1/1. He was cross examined by counsel for insurance
company as well as counsel for claimant.
5(h) R-3/ insurance company has examined its witness Sh. Raj
Kumar, as R3W1 who relied upon documents Ex.R3W1/1 to
Ex.R3W17 including, copy of insurance policy, cheque bearing
no. 003937, Return Memo along with intimation, the report
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regarding non compliance of 64 VB as Ex.R3W1/4.
5(i) Respondent Evidence was also closed. Matter was then
listed for Final Arguments.
6. Final Arguments:
6(a) Counsel for LRs of deceased Late Sh. Suresh Mishra filed
Written Submissions asserting that the accident happened on
account of sheer recklessness on the part of driver of the
offending vehicle as the vehicle was parked without backlight
and without parking lights and therefore, there was no
possibility for the TSR driver to understand that there was a
vehicle stationed on one side of the road. Further, he pointed out
that the iron plates were dangerously protruding out of the body
of the truck which caused such a major accident. Counsel for
injured persons filed Written Submissions and argued that
testimony of eye witness Muskan be considered in all injury
matters as well. He also argued that medical documents
pertaining to injured persons are on record and compensation
may be awarded to them on the basis of material available on
record. It is stated that the eye witness Muskan has been
examined who has narrated in detail about the circumstances of
the accident. It is prayed that compensation to the tune of Rs. 5
lakhs be awarded towards the death of Late Sh. Suresh Chandra
Mishra.
6(b) Counsel for the insurance company has argued that he has
led evidence to prove that the cheque issued towards premium of
issuance of insurance policy was dishonoured and the insurance
company had duly intimated about the factum of dishonour of
cheque and consequent cancellation of policy to the owner of the
offending vehicle much prior to the accident and therefore, it
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owes no duty to indemnify owner against the liability incurred
by him qua the accident caused by the use of offending vehicle.
6(c) Counsel for Driver and owner of the offending vehicle
also filed Written Submissions stating that the accident took
place on a 50 feet wide road while the vehicle was properly
parked on the left side of the road under an electricity pole,
therefore, even the spot of accident was well lit indicative to the
other road users about the stationed vehicle and therefore, the
sole negligence is attributable to the TSR driver who negligently
and unmindfully rammed into a stationed truck. It is pointed that
the truck had its parking lights on and therefore, driver of the
offending vehicle cannot be faulted with improper parking
which caused the accident. Additionally, reliance has been
placed upon T. O. Anthony Vs. Karvarnan & Ors. (2008) 3 SCC
748 and K Hemlata & Ors Vs. Himachal Road Transport
Corporation (2017) 11 SCC 437 in respect of contributory
negligence. It is also pointed out that the vehicle was duly
insured as on the date of incident as per the information
available with the owner and did not receive any intimation
about the cancellation of the policy until after the accident
occurred. It is stated that the email address of the owner's
company was duly mentioned on the cover note of the policy
document and the office of owner was also located in
Ghaziabad. It is pointed out that the cancellation intimation
could not reach the owner and was never emailed or was
attempted to be sent on the other address of the owner or
address of the agent and therefore, it cannot be stated that any
intimation about the cancellation of insurance policy was indeed
received by the owner of offending vehicle. Reliance placed
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upon following judgments:
(i) National Insurance Co. Ltd. Vs. Seema Malhotra & Ors.
(2001) 3 SCC
(ii) United India Insurance Co. Ltd Vs. Laxmamma & Ors.
(2012) 5 SCC
(iii) Oriental Insurance Co. Ltd. Vs. Inderjeet Kaur & Ors.
(1998) 1 SCC 371.
7. Discussion:
On the basis of material on record, evidence adduced and
arguments addressed, issue wise findings are as under :-
ISSUE NO. 1
Whether the Victim Sh. Suresh Mishra suffered fatal injury
and Ms. Shamia, Ms. Afreen, Ms. Muskan and Sh. Aarif
suffered injuries in a road traffic accident dated 13.09.2017
involving vehicle bearing Reg. no. UP 17T 9989 driven by
R-1 and owned by R-2 (not insured) due to rash and
negligent driving of R-1? OPP
7(a) PW-1 appeared in the witness box in the capacity of wife
of deceased. She has admitted that she was not an eye witness to
the incident.
7(b) PW-2 Muskan has been examined as an eye witness who
deposed that on 13.09.2017 at about 04.00 AM, she along with
Arif, Amrin and Shamia had hired an auto from Anand Vihar
Station till their home at Sarai Kale Khan and while crossing
Akshardham Flyover, the auto rammed into a Trolla, bearing
Reg. No. UP 17T 9989, negligently stationed on the road
without any indicators, blinker or or any other signage
indicative of its parked position. She also affirmed that the trolla
was loaded with iron rods which were hanging outside without
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any cloth or any other substance indicative of the loaded and
protruding rods. She deposed that auto driver had died due to
the accident whereas the passengers sitting in the TSR received
injuries. She was extensively cross examined by counsel for the
insurance company. She clarified that the she along with Amrin
and Shamia were sitting on the passenger seat of the TSR
whereas Arif was sitting along with driver of TSR. She declined
the suggestion that the accident took place as driver of TSR
could not balance it due to an extra passenger seated in it. She
also stated that the driver of Trolla was present at the time of
accident, however, subsequently, fled away from the scene. She
also admitted that she was examined before the concerned
criminal court as well. She stated that she got to know about the
death of TSR driver on the date of accident itself. She declined
the suggestion that the accident did not occur on account of
wrongful parking of the Trolla. She was not cross examined by
counsel for driver and owner. Subsequently, PW-2 Amrin
tendered evidentiary affidavit and relied upon certain
documents including medical bills, however, she was not cross
examined and subsequently never appeared for the purpose of
cross examination and therefore, her part examination is not
being treated as evidence and therefore, not read.
7(c). The first description of the spot of accident, as noted by
SI Ram Kishore when he reached at the spot upon receipt of
first information about the accident, where he found the two
vehicles in accidental condition, explains all about the manner
of the accident and the potential cause thereto. It is noted as part
of charge sheet that the iron plates / iron rods were significantly
protruding out of the main body of the trolla without any
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 11 of 48
warning sign, indicative to the other public users for cautious
driving, with no backlights and no parking lights in use at the
time of accident. The extent of damage on the frontal side of the
TSR also explains that the driver of TSR was caught unaware of
the stationed trolla ahead and particularly about the hanging /
protruding iron rods/ plates. There is no evidence on record to
suggest that any reflectors were put in place to indicate that the
vehicle was parked / stationed on one side of the road. Merely
to state that it was a wide road with full CCTV coverage and
ample roadlight, thereby imputing the cause of accident to the
negligence of the TSR driver, cannot absolve the trolla driver of
responsible supervision and efficient handling of such a big
vehicle. PW-2 Muskan has categorically deposed that the
accident happened due to sole negligence of the trolla driver.
She was not asked to clarify about the visibility or the
functionality of the roadlights at the time of accident.
7(d). Driver of the offending vehicle examined himself as
R1W1 who affirmed that the vehicle was positioned on left side
of the 50 feet wide road as a stone had stuck between the wheels
of the truck due to which, it could not be put in motion and so
he stationed the truck on left side so as to pull out the stone to
ensure smooth riding of truck. He specified that the parking
lights of the truck were put on, however, TSR, being driven in
rash and negligent manner suddenly rammed into the truck.
7(e). There is no significance of the reason as to why the driver
decided to station the truck. There is no evidence about a
particular duration for which it was stationed. Further, if there
was a mechanical issue, the driver would not have been in a
position to actually navigate the truck to the extreme left so as
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to avoid any mishappening. It is noted that truck was
temporarily halted due to lodging of a stone in the tyre, was not
put forth in the WS filed on behalf of R-1 & R-2. TSR vehicle
was also being plied towards the left lane possibly to ensure
safe travel. TSR driver could not have anticipated a big vehicle
stationed ahead on the left side without any indication
whatsoever. The affirmation made by the driver in his affidavit
that the parking lights were on, only appears to the an
afterthought, considering the first moment observations put
forth by the Investigating Officer when he first visited the spot.
No reason or adverse interest can be imputed upon the
Investigating Officer for not reporting the facts truthfully as part
of the charge sheet. It is a case where the manner and extent of
damage itself narrate the story of utter recklessness on the part
of trolla driver who was in effective charge and exercised
complete supervision over the handling of the trolla vehicle at
the time of accident. It was the responsibility of the trolla driver
to not only ensure safe driving but safe halting so that his
actions do not pose danger to the other road users. No where has
R1W1 affirmed that the iron sheets / iron rods were not
protruding out of the body of the running board or that any
blinkers were used / employed/ made functional at the end of
those rods to indicate to the other road users about any such
dangerous goods being carried in the vehicle.
7(f). Relevant at this stage would be to reproduce Rule 93 (8)
of Central Motor Vehicles Rule 1989 which prescribed the
applicable rules in respect of any load being carried in a motor
vehicle, as under:
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"No motor vehicle shall be loaded in such a manner that the
load or any part thereof extends,
(i)laterally beyond the side of the body;
(ii)to the front beyond the foremost part of the load body of
the vehicle;
(iii)to the rear beyond the rear most part of the vehicle;
(iv)to a height beyond the limits specified in sub-rule
(4):Provided that clause (iii)shall not apply to a goods
carriage when loaded with any pole or rod or indivisible
load so long as the projecting part or parts do not exceed the
distance of one metre beyond the rear most point of the
motor vehicle."
7(g). Noting that such load protrusions became one of the
major cause of road accidents running into several thousands in
different states of India, the Road Transport Ministry deleted
the proviso to Sec. 93 (8) of CMVR 1989 to ban the vehicles
from carrying the rods, pipes or any protruding materials
beyond the body frame of a motor vehicle. This was notified by
Government of India, Ministry of Road Transport and
Highways vide its Notification G.S.R.152 (E) dated 05.03.2014,
with the result that any goods carrier would not be permitted to
carry any load protruding outside the body frame of the motor
vehicle while moving or in a stationary position. An advisory in
this respect was also issued by Joint Secretary to the
Government of India vide Correspondence No.
24013/24/C.C./2012-CSR.III (Part), Government of India
Ministry of Home Affairs (CS Division), addressed to The Chief
Secretaries of the State Government and UT Administration to
strictly ensure that no vehicle should be allowed to carry
protruding load and other dangerous, protruding materials and
that strict action should be taken against the violators under the
Appropriate Laws. The violators were directed to be prosecuted
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 14 of 48
under Sec. 190 of the Motor Vehicles Act 1988 which prescribes
the law in respect of using of Motor Vehicle in an unsafe
condition. Sec. 190 of the Motor Vehicles Act 1988 is
reproduced hereunder for ready reference:
"190. Using vehicle in unsafe condition. - (1) Any person
who drives or causes or allows to be driven in any public
place a motor vehicle or trailer while the vehicle or trailer
has any defect, which such person knows of or could have
discovered by the exercise of ordinary care and which is
calculated to render the driving of the vehicle a source of
danger to persons and vehicles using such place, shall be
punishable with fine [of one thousand five hundred rupees]
or, if as a result of such defect an accident is caused causing
bodily injury or damage to property, with imprisonment for
a term which may extend to three months, or with fine [of
five thousand rupees], or with both [and for a subsequent
offence shall be punishable with imprisonment for a term
which may extend to six months, or with a fine of ten
thousand rupees for bodily injury or damage to property]."
7(h). Section 190 MV Act penalizes any person in respect of a
motor vehicle being used in any public place in a manner
violating the standards prescribed in relation to road safety or
violative of the provisions of the Act or the rules made
thereunder in relation to the carriage of goods which are of
dangerous or hazardous nature to humane life.
7(i). Eye witness PW-2 Muskan clearly stated that the Trolla
was negligently stationed on the road without any indicator,
blinker or any stoppage sign. Corresponding to this affirmation,
is the unequivocal and categoric observation of the
Investigating Officer in the Charge Sheet that there was no back
light installed, the parking light was not put on and the iron
plates /rods were protruding by three to four feet. There is no
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 15 of 48
challenge to the Charge-sheet and specifically to this
observation by the contesting counsels. The Investigating
Officer has not been made to testify to tender any explanation or
to seek any contradiction in the observations made as part of
charge sheet and there is no reason with the court to disbelieve
the same. The counsel for R-1 & 2 has rather relied upon the
site plan forming part of the charge sheet to show that the truck
was stationed below an electricity pole on a 50 feet wide road
and therefore, there is no occasion for the collision to have
happened and thus, in the same breath, he cannot be allowed to
question the observations made by the Investigating Officer
when he first visited the spot of accident and saw the vehicles in
accidental condition.
7(j). There is no evidence that the road was sufficiently lit at
the time of accident that the TSR driver had clear visibility of
the stationed trolla ahead. It is also evident that no blinkers or
warning signs were installed at the rear end of the protruding
material to indicate to the other road users that such a
protruding load was being carried in the trolla. It is settled that
the vehicle cannot be stated to be properly parked / stationed
unless proved that the parking lights were on and the blinkers /
reflectors were put in place indicating to the other road user
about a stationed loaded truck. (Reliance placed upon the case
titled as Mohini Mohanrao Salunke Vs. Ramdas Hanumant
Jadhav & Ors. J 1013 FA 569-2022, decided by Bombay High
Court). The contention that it was a 50 feet wide road and
therefore, the TSR driver ought to have passed from the side of
trolla would be like to state that the driver had no right to use
left side of the road where the trolla was stationed which is a
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 16 of 48
very absurd projection. It is evident that the obstacles / road
block ahead was not in active anticipation of the TSR driver due
to which he rammed straight into the protruding iron rods and
suffered fatal injury.
7(k). There is no evidence that the TSR driver was speedily or
rashly driving and was not dutiful towards the safety of
passengers seated in the TSR at the time of accident There is no
evidence that the TSR itself lost control as suggested by counsel
for insurance company on account of a passenger seated next to
him on the driver seat thereby causing the accident. What the
accidental condition and extent of damage speaks is that the
TSR driver did not realise that there was any stationed truck
ahead and that too with dangerous protruding iron rods and had
no time to navigate to avoid or avert the collision with the
protruding iron rods/plates in order to save his life.
7(l). There is absolutely no dispute in respect of identification
of the offending vehicle considering that the vehicle was seized
by the police officials from the site of accident itself. There is
no denial by R-1 & R-2 that the accident did not take place with
Trolla. Driver of the offending vehicle was produced by the
owner of the offending vehicle in the police station upon
service of notice under Section 133 MV Act. It is not out of
place to mention that the driver of the offending vehicle R1 had
refused to participate in the Test Identification Parade
proceeding. Relevant would it be also to note the affirmation of
PW-2 Muskan that the driver had fled away from the scene after
the accident which also reflects upon the basic sense of
responsibility and accountability showcased by the said driver
on the occasion of unfateful eventuality.
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 17 of 48
7(m). R-1 has been charge sheeted for causing injury to victims
due to speedy and rash driving of the offending vehicle. It is
settled that filing of charge sheet itself is a significant step
towards the inference of negligence on the part of driver of the
offending vehicle. (Support drawn from the Judgment in the
case of National Insurance Company Vs. Pushpa Rana 2009
ACJ 287 Delhi as referred and relied by Hon'ble Supreme Court
of India in case of Ranjeet & Anr. Vs. Abdul Kayam Neb & Anr
SLP (C) No. 10351/2019).
7(n). On account of the detailed discussion above, the
contention raised on behalf of R-1 that he had put his parking
lights on and the negligence was on the part of TSR driver to
ram the TSR into a stationed trolla on the left side of the road is
rejected.
7(o). It is a well-established legal principle that negligence in
motor accident cases should be determined based on the
preponderance of probabilities, not on proof beyond reasonable
doubt. The facts and circumstances must be considered in a
broad and practical manner. It is also settled that proceedings
under the Motor Vehicles Act are different from regular civil
suits and are not strictly governed by the technical rules of the
Indian Evidence Act. This view has been supported in the
judgments of Bimla Devi & Ors. v. Himachal Road Transport
Corporation & Ors., (2009) 13 SCC 530; Kaushnumma Begum
& Ors. v. New India Assurance Co. Ltd., 2001 ACJ 421 (SC);
and National Insurance Co. Ltd. v. Pushpa Rana, 2009 ACJ 287.
7(p). It is held that the Trolla driver was reckless in having
stationed the fourteen wheeled trolla with protruding iron rods /
iron plates beyond its body frame, (prohibited by law) and also
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 18 of 48
without any blinkers on the tail of the protruding load and even
without putting on the parking lights indicating to the other road
users about a vehicle stationed ahead so that they can exercise
caution while driving / while using the public road. It is thus
held that the accident occurred on account of utter negligence
on the part of driver of the offending trolla whereby he failed to
exercise basic duty of care towards the safety of the fellow road
users, resulting in a major accident. Issue No.1 is decided
accordingly, in favour of the petitioners and against the
contesting respondents.
ISSUE NO.2
Whether the petitioners are entitled to any compensation,
if so, to what extent and from whom ? OPP.
8. Section. 168 MV Act enjoins the Claim Tribunals to hold
an enquiry into the claim to make an effort determining the
amount of compensation which appears to it to be just and
reasonable. Same is reproduced hereunder for ready reference:
(1) Award of the Claims Tribunal.--On receipt of an
application for compensation made under section 166, the
Claims Tribunal shall, after giving notice of the
application to the insurer and after giving the parties
(including the insurer) an opportunity of being heard, hold
an inquiry into the claim or, as the case may be, each of
the claims and, subject to the provisions of section 162
may make an award determining the amount of
compensation which appears to it to be just and
specifying the person or persons to whom compensation
shall be paid and in making the award the Claims
Tribunal shall specify the amount which shall be paid by
the insurer or owner or driver of the vehicle involved in
the accident or by all or any of them, as the case may be:
Provided that where such application makes a claim for
compensation under section 140 in respect of the death or
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 19 of 48
permanent disablement of any person, such claim and any
other claim (whether made in such application or
otherwise) for compensation in respect of such death or
permanent disablement shall be disposed of in accordance
with the provisions of Chapter X.
(2) The Claims Tribunal shall arrange to deliver copies of
the award to the parties concerned expeditiously and in
any case within a period of fifteen days from the date of
the award.
(3) When an award is made under this section, the person
who is required to pay any amount in terms of such award
shall, within thirty days of the date of announcing the
award by the Claims Tribunal, deposit the entire amount
awarded in such manner as the Claims Tribunal may
direct.
9. Before putting in frame the position of law, it is noted that
the process of determining the compensation by the court is
essentially a very difficult task and can never be an exact
science. Perfect compensation is hardly possible, more so in
claims of injury and disability. (As observed by Hon'ble
Supreme Court of India in the case of Sidram Vs. The
Divisional Manager United India Insurance Company Ltd, SLP
(Civil) No. 19277 of 2019).
10. The basic principle in assessing motor vehicle
compensation claims, is to place the victim in as near a position
as she or he was in before the accident, with other compensatory
directions for loss of amenities and other payments. These
general principles have been stated and reiterated in several
decisions. [Support drawn from Govind Yadav v. New India
Insurance Co. Ltd., (2011) 10 SCC 683.]
11. This Tribunal has been tasked with determination of just
compensation. The observation of Hon'ble Supreme Court of
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 20 of 48
India in Divisional Controller, KSRTC v. Mahadeva Shetty and
Another, (2003) 7 SCC 197, needs mention here (para 15):
"Statutory provisions clearly indicate that the
compensation must be "just" and it cannot be a bonanza;
not a source of profit but the same should not be a
pittance. The courts and tribunals have a duty to weigh
the various factors and quantify the amount of
compensation, which should be just. What would be
"just" compensation is a vexed question. There can be no
golden rule applicable to all cases for measuring the value
of human life or a limb. Measure of damages cannot be
arrived at by precise mathematical calculations. It would
depend upon the particular facts and circumstances, and
attending peculiar or special features, if any. Every
method or mode adopted for assessing compensation has
to be considered in the background of "just"
compensation which is the pivotal consideration. Though
by use of the expression "which appears to it to be just", a
wide discretion is vested in the Tribunal, the
determination has to be rational, to be done by a judicious
approach and not the outcome of whims, wild guesses and
arbitrariness.. ..."
12. In The Landmark Case of National Insurance Company
Limited Vs. Pranay Sethi And Others (2017 SCC Online SC
1270), decided by constitutional bench of Hon'ble Supreme
Court of India, regarding the concept of 'just compensation' it
was held :
"................55. Section 168 of the Act deals with the concept of
"just compensation" and the same has to be determined on the
foundation of fairness, reasonableness and equitability on
acceptable legal standard because such determination can never
be in arithmetical exactitude. It can never be perfect. The aim is
to achieve an acceptable degree of proximity to arithmetical
precision on the basis of materials brought on record in an
individual case. The conception of "just compensation" has to
be viewed through the prism of fairness, reasonableness and
non-violation of the principle of equitability. In a case of death,
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 21 of 48
the legal heirs of the claimants cannot expect a windfall.
Simultaneously, the compensation granted cannot be an apology
for compensation. It cannot be a pittance. Though the discretion
vested in the tribunal is quite wide, yet it is obligatory on the
part of the tribunal to be guided by the expression, that is, "just
compensation". The determination has to be on the foundation
of evidence brought on record as regards the age and income of
the deceased and thereafter the apposite multiplier to be applied.
The formula relating to multiplier has been clearly stated in
Sarla Verma and it has been approved in Reshma Kumari . The
age and income, as stated earlier, have to be established by
adducing evidence. The tribunal and the courts have to bear in
mind that the basic principle lies in pragmatic computation
which is in proximity to reality. It is a well-accepted norm that
money cannot substitute a life lost but an effort has to be made
for grant of just compensation having uniformity of approach.
There has to be a balance between the two extremes, that is, a
windfall and the pittance, a bonanza and the modicum. In such
an adjudication, the duty of the tribunal and the courts is
difficult and hence, an endeavour has been made by this Court
for standardisation which in its ambit includes addition of future
prospects on the proven income at present..................."
13. Further about the principles relating to Assessment of
compensation in case of death, it was held in Pranay Sethi
(supra) that detailed analysis of Sarla Verma (SMT) And Others
Versus Delhi Transport Corporation And Another (2009 Scc
Online Sc 797) is necessary as in the said case, the Court
recapitulated the relevant principles relating to assessment of
compensation in case of death. In fact , Hon'ble SC in Pranay
Sethi (supra) mainly relied and approved the earlier judgment of
Sarla Verma( Supra) read with Reshma Kumari[( 2013) 9 SCC
65 : (2013) 4 SCC (Civ) 191 : (2013) 3 SCC (Cri) 826 ], with
some modification, regarding all the aspects like aspect of
multiplier,the steps and guidelines stated in para 19 of Sarla
Verma for determination of compensation in cases of death,
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 22 of 48
future prospects, deduction to be made towards personal and
living expenses.
14. PW-1 Anju Devi affirmed that her husband was a
commercial auto driver with commercial driving license bearing
no. DL-0520010151908 and PSV Driver's Badge no.
P051000540 and was earning about Rs.50,000/- per month. She
also stated that the deceased was matriculate and relied upon
High School Examination Mark Sheet placed on record as
Ex.PW1/4. During cross examination, she stated that her
husband worked in Delhi for about 15-20 years prior to the
accident and was aged about 40 to 41 years at the time of
accident. She admitted that she has not filed any document
regarding income of her husband. She also stated that owner of
TSR was one Ajit who had not offered any compensation to her
post death of her husband in accident. She also stated that she
has not filed any other claim at Allahabad or any other court. She
also stated that her father in law was alive when her husband
died. Deceased was driving the TSR at the time of accident. No
objection has been raised in respect of the authenticity or
genuineness of the commercial driving license of the deceased,
copy of which has been placed on record as Mark A. His Aadhar
Card has also been placed on record as Edx.PW1/2 which
reflects his residence to be that of Khajuri Khas Delhi, even his
DL and PSV Driver's badge has been issued by Transport
Department, Government of NCT Delhi, therefore, his monthly
earning is taken to be that of skilled person as applicable in the
State of NCT of Delhi which was Rs. 16,468/- as on the date of
accident.
15. His date of birth as per the Matriculation Mark Sheet
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 23 of 48
Ex.PW1/4 and the Driving License (Mark A) is 11.01.1977,
therefore, his age as on the date of accident would be 40 years
and 8 months. As deceased was between the age of 40 to 50
years (at the time of accident) and purportedly earing fixed
income (minimum wages), thus the percentage towards future
prospect is taken to be @ 25 % {as laid down in the case of
Pranay Sethi (supra)}.
Step No- 1 : Ascertainment of Multiplicand:
16. Deceased was survived by wife, aged parents and three
children. Out of three children eldest daughter barely turned 18
as on the date of accident. There is no evidence that she was
married prior to the accident or was independently placed as on
the date of accident. It is settled that the aged parents always
remain dependent upon their children and their dependency
rather increases with age (support drawn from the judgment in
the case of Indrawati & Anr vs. Ranbir Singh & Ors. MAC APP
623/2019 of Hon'ble Delhi High Court). It is settled that the
dependency has to be determined as on the date of accident
when the father of deceased was also alive and therefore,
considered to be dependent along with mother of deceased. It is
thus held that there were 5 dependents upon the deceased as on
the date of accident and therefore, as per the mandate of Pranay
Sethi (supra), Deduction of 1/4 is applicable.
Step No- -2 : Ascertainment of Multiplier:
17. In the present case, age of the deceased was about 40 and
8 months. Thus, multiplier of 15 is applicable {as per table
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 24 of 48
mentioned in para no.40 of Sarla Verma (supra)}.
Step No- -3 : Actual Calculation ( actual loss/loss of
dependency):
18. Applying the above parameters, the actual calculation is
laid down as under:
18.1. Annual income of the deceased.
(Rs.16,468/- per month x 12) = Rs. 1,97,616/-
18.2 Future prospect (25 % of Rs. 1,97,616/-) = Rs.
49,404/-
------------------
18.3. Total = Rs.2,47,020/-
18.4. Deduction for personal expenses
(1/4 of Rs.2,47,020/-) = (-) Rs. 61,755/-
18.5. Multiplicand
( Rs.2,47,020/- (-) Rs. 61,755/-) = Rs. 1,85,265/-
18.6. As such, the total loss of dependency is: Rs. 1,85,265 ( multiplicand) x 15 (multiplier) = Rs.27,78,975/-
19. Grant of Loss of Estate, Loss Of Consortium And Funeral Expenses:
19(a). Certain observations, as relevant to the context in the case of Pranay Sethi (supra) were made, which are reproduced as MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 25 of 48 under:
''...............46. Another aspect which has created confusion pertains to grant of loss of estate, loss of consortium and funeral expenses..... .
.
52. As far as the conventional heads are concerned, we find it difficult to agree with the view expressed in Rajesh . It has granted Rs 25,000 towards funeral expenses, Rs 1,00,000 towards loss of consortium and Rs 1,00,000 towards loss of care and guidance for minor children. The head relating to loss of care and minor children does not exist. Though Rajesh refers to Santosh Devi , it does not seem to follow the same. The conventional and traditional heads, needless to say, cannot be determined on percentage basis because that would not be an acceptable criterion. Unlike determination of income, the said heads have to be quantified. Any quantification must have a reasonable foundation. There can be no dispute over the fact that price index, fall in bank interest, escalation of rates in many a field have to be noticed. The court cannot remain oblivious to the same. There has been a thumb rule in this aspect. Otherwise, there will be extreme difficulty in determination of the same and unless the thumb rule is applied, there will be immense variation lacking any kind of consistency as a consequence of which, the orders passed by the tribunals and courts are likely to be unguided.
Therefore, we think it seemly to fix reasonable sums. It seems to us that 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 principle of revisiting the said heads is an acceptable principle. But the revisit should not be fact-centric or quantum-centric. We think that it would be condign that the amount that we have MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 26 of 48 quantified should be enhanced on percentage basis in every three years and the enhancement should be at the rate of 10% in a span of three years. We are disposed to hold so because that will bring in consistency in respect of those heads.
.
.
59.8. 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...............'' 19(b). Claimants are held entitled to certain fixed sums towards grant of loss of estate, loss of consortium and funeral expenses as mentioned above.
19(c). In respect of consortium, certain observations were made in case of Magma General Insurance Co. Ltd. v. Nanu Ram & Ors. (2018) 18 SCC 130, by Hon'ble Supreme Court of India which are as under:
"This Court interpreted "consortium" to be a compendious term, which encompasses spousal consortium, parental consortium, as well as filial consortium. The right to consortium would include the company, care, help, comfort, guidance, solace and affection of the deceased, which is a loss to his family. With respect to a spouse, it would include sexual relations with the deceased spouse.
Parental consortium is granted to the child upon the premature death of a parent, for loss of parental aid, protection, affection, society, discipline, guidance and training.
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 27 of 48 Filial consortium is the right of the parents to compensation in the case of an accidental death of a child. An accident leading to the death of a child causes great shock and agony to the parents and family of the deceased. The greatest agony for a parent is to lose their child during their lifetime. Children are valued for their love and affection, and their role in the family unit.
Modern jurisdictions world-over have recognized that the value of a child's consortium far exceeds the economic value of the compensation awarded in the case of the death of a child. Most jurisdictions permit parents to be awarded compensation under loss of consortium on the death of a child. The amount awarded to the parents is the compensation for loss of love and affection, care and companionship of the deceased child.
The Motor Vehicles Act, 1988 is a beneficial legislation which has been framed with the object of providing relief to the victims, or their families, in cases of genuine claims. In case where a parent has lost their minor child, or unmarried son or daughter, the parents are entitled to be awarded loss of consortium under the head of Filial Consortium.
Parental Consortium is awarded to the children who lose the care and protection of their parents in motor vehicle accidents.
The amount to be awarded for loss consortium will be as per the amount fixed in Pranay Sethi (supra).
At this stage, we consider it necessary to provide uniformity with respect to the grant of consortium, and loss of love and affection. Several Tribunals and High Courts have been awarding compensation for both loss of consortium and loss of love and affection. The MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 28 of 48 Constitution Bench in Pranay Sethi (supra), has recognized only three conventional heads under which compensation can be awarded viz. loss of estate, loss of consortium and funeral expenses.
In Magma General (supra), this Court gave a comprehensive interpretation to consortium to include spousal consortium, parental consortium, as well as filial consortium. Loss of love and affection is comprehended in loss of consortium.
The Tribunals and High Courts are directed to award compensation for loss of consortium, which is a legitimate conventional head. There is no justification to award compensation towards loss of love and affection as a separate head."
19(d). Applying the enhancement of 10% every three years from 31.10.2017, a sum of Rs.18,150/- for cremation expenses; and Rs.18,150/- towards loss of estate is awarded. 19(e). Further, on the date of accident, deceased had left behind, his wife, parents and three children. All of them are held entitled to Rs. 48,400/- each towards loss of consortium.
Total Award Amount
20. Thus the total award amount comes to Rs.27,78,975/- (+) Rs 18,150/-( Loss to estate) + Rs. 18,150/-( funeral expenses) + Rs.2,90,400/- (loss of consortium) = Rs. 31,05,675/-
21. Interest:
21(a) It is settled that any fixed rate of interest cannot be prescribed for all cases at all times and would largely depend upon the prevailing rate of interest as per the applicable guidelines. As such, interest at the rate of 7.5% per annum is deemed fit and accordingly granted in the present case.
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 29 of 48 (Reliance placed upon National Insurance Company Ltd Vs. Yad Ram MAC APP 526/2018 also referred and relied in case of The Oriental Insurance Company Ltd Vs. Sohan Lal & Ors. MAC APP 70/2024 of the Hon'ble Delhi High Court).
22. Liability:-
22(a) Insurance company produced R3W1 Sh. Raj Kumar, Senior Assistant, The Oriental Insurance Company, who deposed that the policy no.25400/31/2018/575 was obtained in respect of the offending vehicle upon issuance of a cheque bearing no. 003937 dated 21.06.2017, drawn on Union Bank of India which was cancelled subsequently on 03.07.2017 from the date of inception, on account of dishonour of cheque towards premium consideration, the intimation about which was received by the insurance company on 29.06.2017. The above mentioned dishonoured cheque has been placed on record as Ex.R3W1/2 and the return memo along with intimation of dishonour is Ex.R3W1/3 (colly). The report regarding non compliance of 64 (VB) of Insurance Act is Ex.R3W1/4. The insurance policy originally issued has been relied as Ex.R3W1/1 while its cancellation upon non realisation of the premium by the office of insurance company is Ex.R3W1/5. R3W1 Raj Kumar further deposed that owner / R-2 of the offending vehicle as well as the concerned office head of Transport Authority at Baghpat were duly intimated regarding the cancellation of the policy. He relied upon copy of letters addressed to the insured and the Transport Authority as Ex.R3W1/6 while the dispatch register with postal dispatch receipts along with entries and original returned envelope addressed to the owner and RTO have been MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 30 of 48 placed reliance upon as Ex.R3W1/7 (OSR). He deposed that the vehicle was not insured as on the date of accident.
22(b). R3W1 was extensively cross examined by counsel for R-1 & R-2 wherein he stated that policy Ex.R3W1/1 was issued by the Ghaziabad Office of the insurance company, however, admitting that the cancellation intimation was sent to the Baghpat address of the policy holder which was returned back with the remarks "kafi talash ke baad kuch bhi pata nahi chala". He stated that he had no personal knowledge about any other office of Lion Transport, located in Ghaziabad and also was not aware as to whether the owner/ proprietor of Lion Transport was residing in Ghaziabad which is why, they did not forward the cancellation intimation to Ghaziabad address. He stated that he was not aware whether any cancellation intimation was emailed to owner of the offending vehicle or whether any such intimation was sent to the agent or whether any mobile message was sent to the owner of the offending vehicle. He also stated that any legal notice was not issued to R-2 regarding cancellation upon dishonour of cheque. The witness could not trace out the dispatch postal receipt for sending the cancellation intimation from the record. He admitted that any registered postal receipt is not reflected in the dak book of the oriental insurance company which is Ex.R3W1/7. He declined the suggestion that the cancellation intimation was duly sent at Baghpat address of the Lion Transport Corporation. 22(c). Counsel for insurance company has argued that the insurance company has no contractual and statutory liability to compensate the victim against an obligation to indemnify the acts of owner as per terms and conditions of the insurance MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 31 of 48 policy. Per contra, counsel for R-1 & R-2 has contended that intimation about cancellation of insurance policy was not duly given to the respondent no.2 as owner and therefore, insurance company cannot shy from its obligation to indemnify the third parties in respect of the liability against the insurance policy. 22(d). The legal position in respect of the liability of the insurance company when the insurance policy has already been cancelled prior to the date of accident, upon non payment of consideration has been summarized in Para 26 of United India Insurance Company Limited Vs. Laxmamma & ors (2012) 5 SCC 234 which is reproduced as under:
"In our view, the legal position is this: where the policy of insurance is issued by an authorised insurer on receipt of cheque towards the payment of premium and such a cheque is returned dishonoured, the liability of the authorised insurer to indemnify the third parties in respect of the liability which that policy covered subsists and it has to satisfy the award of compensation by reason of the provisions of Sections 147(5) and 149(1) of the MV Act unless the policy of insurance is cancelled by the authorised insurer and intimation of such cancellation has reached the insured before the accident. In other words, where the policy of insurance is issued by an authorised insurer to cover a vehicle on receipt of the cheque paid towards premium and the cheque gets dishonoured and before the accident of the vehicle occurs, such insurance company cancels the policy of insurance and sends intimation thereof to the owner, the insurance company's liability to indemnify the third parties which that policy covered ceases and the insurance company is not liable to satisfy awards of MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 32 of 48 compensation in respect thereof."
22(e). Hon'ble Supreme Court of India referred to its own decision in the case of Oriental Insurance Co. Ltd. Vs. Inderjeet Kaur & Ors. (1998) 1 SCC 371 and New India Assurance Co. Ltd Vs. Rula (2000) 3 SCC 195 with reference to Sec. 64 (VB) of the Insurance Act and relevant provisions of the Contract Act and made following observations in the case of National Insurance Co. Ltd. Vs. Seema Malhotra & Ors. (2001) 3 SCC which were again referred and relied in the case of Laxmamma (supra). Para no. 17 to 20 of the case of Seema Malhotra (supra) as referred in the Laxmamma (supra) case are reproduced hereunder for the purpose of further discussion:
"17.. In a contract of insurance when the insured gives a cheque towards payment of premium or part of the premium, such a contract consists of reciprocal promise. The drawer of the cheque promises the insurer that the cheque, on presentation, would yield the amount in cash. It cannot be forgotten that a cheque is a bill of exchange drawn on a specified banker. A bill of exchange is an instrument in writing containing an unconditional order directing a certain person to pay a certain sum of money to a certain person. It involves a promise that such money would be paid.
18. Thus, when the insured fails to pay the premium promised, or when the cheque issued by him towards the premium is returned dishonoured by the bank concerned the insurer need not perform his part of the promise. The corollary is that the insured cannot claim performance from the insurer in such a situation.
19. Under Section 25 of the Contract Act an agreement made without consideration is void. Section 65 of the Contract Act says that when a contract becomes void any person who has received any advantage under such contract is bound to restore it to the person from whom he received it. So, even if the insurer has disbursed the amount covered MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 33 of 48 by the policy to the insured before the cheque was returned dishonoured, the insurer is entitled to get the money back.
20. However, if the insured makes up the premium even after the cheque was dishonoured but before the date of accident it would be a different case as payment of consideration can be treated as paid in the order in which the nature of transaction required it. As such an event did not happen in this case, the insurance company is legally justified in refusing to pay the amount claimed by the respondents."
22(f). In a similar case, as facts of the matter at hand titled as Deddappa & Ors. Vs. The Branch Manager, National Insurance Co. Ltd. AIR 2008 SUPREME COURT 767 also referred in the Laxmamma (supra) case, following observations as relevant in the context of present discussion were made:
"24.We are not oblivious of the distinction between the statutory liability of the insurance company vis-à-vis a third party in the context of Sections 147 and 149 of the Act and its liabilities in other cases. But the same liabilities arising under a contract of insurance would have to be met if the contract is valid. If the contract of insurance has been cancelled and all concerned have been intimated thereabout, we are of the opinion, the insurance company would not be liable to satisfy the claim."
22(g). The legal position as summarized above in the case of Laxmamma (Supra), has been relied by counsel for the R-1 & R-2 as well as by counsel for insurance company. 22(h). It is not in dispute that the Insurance Policy Ex.R3W1/A was duly issued in respect of offending vehicle for a specified period on 30.06.2017 at Ghaziabad with the payable premium against Own Damage as Rs.12,578/- and total amount including the TP cover as Rs.52,615/-. Cheque of the amount of Rs. 52,615/- with date of issue as 21.06.2017, placed on record MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 34 of 48 as Ex.R3W1/2 was issued, which was dishonoured for reasons "fund insufficient" vide Return Memo dated 23.06.2017, received by the Ghaziabad Branch on 29.06.2017. The report about non compliance of Sec. 64 (VB) of Insurance Act, 1938 was issued on 29.06.2017 while the policy was cancelled due to dishonour of cheque and non realisation of premium on 30.06.2017.
22(i). Before proceeding further, it is imperative to reproduce Sec. 64 (VB) of Insurance Act, 1938 which lays down that the insurance company shall be under no liability to assume risk unless the premium is duly paid in the prescribed manner:
64VB. No risk to be assumed unless premium is received in advance "(1)No insurer shall assume any risk in India in respect of any insurance business on which premium is not ordinarily payable outside India unless and until the premium payable is received by him or is guaranteed to be paid by such person in such manner and within such time as may be prescribed or unless and until deposit of such amount as may be prescribed, is made in advance in the prescribed manner.(2)For the purposes of this section, in the case of risks for which premium can be ascertained in advance, the risk may be assumed not earlier than the date on which the premium has been paid in cash or by cheque to the insurer.Explanation.--Where the premium is tendered by postal money order or cheque sent by post, the risk may be assumed on the date on which the money order is booked or the cheque is posted, as the case may be.(3)Any refund of premium which may become due to an insured on account of the cancellation of a policy or alteration in its terms and conditions or otherwise shall be paid by the insurer directly to the insured by a crossed or order cheque or by postal money order and a proper receipt shall be obtained by the insurer from the insured, and such refund shall in no case be credited to the account of the agent.(4)Where an insurance agent collects a premium on a policy of insurance on behalf of an insurer, he shall deposit with, or dispatch by post to, the insurer, the premium so collected in full without deduction of his commission within twenty-four hours of the collection excluding bank and postal holidays.(5)The Central MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 35 of 48 Government may, by rules, relax the requirements of sub-
section (1) in respect of particular categories in insurance policies.(6)The Authority may, from time to time, specify, by the regulations made by it, the manner of receipt of premium by the insurer."
22(j). It is not in dispute that the premium was duly paid against the issued policy by way of cheque, however, as the cheque was dishonoured, the insurance company cancelled the issued insurance policy from the date of its inception upon non compliance of Sec. 64 (VB) of Insurance Act 1938. The only issue in contention between R-2 & R-3 is that the intimation about cancellation of policy was not duly given to R-2. Therefore, he did not come to know that the policy was indeed cancelled by the insurance company. It is not in dispute that the notice/ letter intimating the owner as well as the concerned Baghpat RTA were duly issued by the Insurance Company about cancellation of policy due to non compliance of 64 (VB) of Insurance Act, however, it is also not in dispute that the communication sent through Registered Post was not served upon the owner and was returned back to the Insurance Company. The returned envelope as received by the insurance company, has been placed on record as part of the evidence led on behalf of insurance company which mentions the reason for return as "kaafi talash karne ke bad bhi koi pata nahi chala, wapis". It is noted that the address mentioned on the registered post envelope is the one as mentioned on the policy about particulars of the insured. It is noted that this envelope was returned back on 06.07.2017 while the policy itself was to commence from 22.06.2017. Therefore, there is no reason to presume that the company office shifted from the address MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 36 of 48 already mentioned on the policy as per the particulars provided by the insured himself in such a short time. There is no explanation rendered by the insured about the incorrect address given by him while getting the policy issued or about choosing not to inform the insurance company about change in address thereafter. R-2 admitted during cross examination about dishonour of the cheque towards premium amount. He also admitted that he did not take any step to deposit the premium amount and get the policy re-issued. He declined the suggestion that he was duly intimated about the cancellation of policy at the address mentioned in the Insurance Policy. There is no affirmation by R-2/ Lalit Khandooja that he did not get to know about the dishonour of the cheque issued towards the premium amount. R-2 Lalit Khanduja himself admitted that the Lion Transport Company is his proprietorship firm and thus, he was solely responsible for the accounts of the firm therefore, it cannot be accepted that he did not get to know could not have known about the dishonour of cheque issued towards the premium amount. It can be inferred from his conduct that he chose to be quiet and not to act nonetheless, as the policy had already been issued with no intimation purportedly received by him towards cancellation. He cannot be absolved thus upon contesting that the agent ought to have been informed on the details mentioned in the policy or that he should also have been informed on the mobile number through SMS on his mobile phone. There is no evidence that the insurance company resorted to inform Lalit Khanduja/ owner of the offending vehicle on the modes as mentioned above, in addition to the communication sent through the registered post. Counsel for R-2 argued that any MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 37 of 48 registered post dispatch receipt has not been filed on record. However, copy of dispatch register wherein the receipt was pasted mentioning the dispatch details has been placed on record as part of evidence led on behalf of insurance company. Further as the envelope itself was returned back which mentions the dispatch details and the reason of return, there seems to be no relevance of this contention that the original dispatch receipt has not been placed on record. There is no evidence led by R-2/ owner of the offending vehicle to affirm that he was running the firm from the same address during the period between commencement of the insurance policy and date of return of the unserved envelope and therefore, the communication was wrongly returned. Per contra, once the Insurance Company came to know about the return of communication as unserved, considering the importance of this communication which might jeopardize the lives of third parties not related to the owner and not responsible for the non-payment of the premium amount, ought to have resorted to establish the communication with the owner to inform about the cancellation of the policy upon dishonour of cheque. Although, the mode of communication through registered post is an established acceptable mode, however, there is no reason why that should be the only mode adopted by the insurance company to inform about the cancellation of policy.
22(k). Cancellation of policy is a vital communication with adverse profound consequences for third parties and cannot be treated as a routine casual communication and therefore, as a matter of public policy and the obligations taken up by the insurance policy to provide a social security cover to the MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 38 of 48 innocent people on the road, it is incumbent upon the insurance company to ensure to adopt all possible modes available to disburse the information to the concerned so that the person becomes liable and answerable for the lapse. 22(l). In the case at hand, even though, insurance company did its part by sending the intimation through registered post on the address mentioned on the insurance policy, however, upon gaining the knowledge that it was not served upon the addressee, it was necessary for the insurance company to ensure taking relevant steps to resort to other modes to disburse the crucial intimation upon the owner since, the onus of intimation upon the owner was cast upon the insurance company and not upon the owner. There is no presumption laid down that the owner ought to have developed the understanding on its own that the insurance company would have cancelled the policy as the premium was not paid. Given the importance of this communication and the adverse consequences that it might entail, it is necessary that the intimation about cancellation of policy be disbursed through multiple modes to the owner so as to give him time to correct, sometimes, an unintentional lapse. The Insurance Policy Ex.R3W1/A reflects that the offending vehicle was previously insured and therefore, it does not imply that the owner was reckless throughout to have a commercial vehicle run on the public roads without fulfilling the mandatory statutory requirement of getting the vehicle insured so as to give coverage and protection to the third parties, liable to be indemnified by the insured. Summing up, it can be stated that the owner has defaulted in the payment of the premium amount granting the right to the insurance company to cancel the policy MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 39 of 48 since the date of its inception on account of non compliance of Sec. 64 (VB) of Insurance Act, as consideration towards the contractual liability. However, given the nature of contractual as well as statutory liability, unilateral cancellation by the insurance company cannot be deemed to be due and complete cancellation without ensuring that the cancellation has been duly intimated. The insurance company could not have washed its hand off the matter simply by asserting that the intimation was sent through registered post on the address notified as part of the insurance policy and should have gone beyond that to ensure that the crucial intimation is received by concerned without fail which was not done, entailing serious consequences to the victims of the accident with the uninsured vehicle. Insurance Company is therefore held liable to pay to the victims of the accident the compensation as awarded in this matter with simple interest @ 7.5% p.a. from the date of filing of DAR till actual realization, however, with the right to recover the awarded amount from the R-1/driver (basis of his liability has already been discussed in Issue No.1) and R-2/owner of Trolla. (If there is any order regarding excluding of interest for specific period same be complied at the time of calculation of award amount). It is noted that FDR of Rs. 10,00,000/- was filed on record by R-2 as security deposit to secure stay against auction of the offending vehicle. Upon compliance of the directions about primary payment of the compensation by Insurance Company to the claimants, it would be entitled for encashment of the FDR against recovery rights from R-1/driver & R-2/owner. 22(m). The award amount shall be deposited by the Insurance Company. Counsel for the Insurance Company is also MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 40 of 48 directed to furnish the complete case details, including the MACT case number, CNR number, FIR number, name of Police Station, name of the deceased/claimant(s), date of accident, and any other relevant particulars, to the State Bank of India, Saket Court Branch, New Delhi at the time of getting the amount deposited. The amount shall be deposited through RTGS/NEFT/IMPS in the account titled "MACT FUND PARKING", Account No. 00000042706870765, IFSC Code SBIN0014244, MICR Code 110002342, under intimation to the Nazir of this Tribunal.
23. Release of Award Amount/ Disbursement 23(a) Share of Wife of deceased: Out of total award amount, Rs.15,55,675/- is awarded to wife of deceased. Out of which Rs. 15,00,000/- along with proportionate (to the principle amount) up to date interest is kept in form of monthly FDR of Rs. 20,000/- each. Remaining amount along with proportionate up to date interest shall be released in her bank account near her place of residence.
23(b) Share of Three Children namely Priya Mishra (aged about 18 years as per record as on the date of accident), Prem Kumar Mishra (aged about 14 years, as per record as on the date of accident) & Raj Mishra (aged about 12 years, as per record as on the date of accident): Out of the total compensation amount Rs. 3,00,000/- along with proportionate interest is awarded to Priya Mishra; Rs. 4,00,000/- along with proportionate interest awarded to Prem Kumar Mishra; Rs. 5,00,000/- along with proportionate interest are awarded to Raj Mishra. Since Priya MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 41 of 48 Mishra is major her shared amount of Rs. 3,00,000/- along with proportionate interest shall he released in her bank account near her place of residence. Amount of Prem Kumar Mishra and Raj Mishra shall be kept in form of FDR till they turn the age of majority.
23(c) Share of mother of deceased: Out of total award amount, Rs.3,00,000/- is awarded to mother of deceased along with proportionate interest and whole amount shall be released to her in her bank account near her place of residence.
23.(d) Share of father of deceased: Out of total award amount, Rs.50,000/- is awarded to father of deceased along with proportionate interest and whole amount shall be released to him in his bank account near his place of residence.
24. In terms of the Practice Directions issued by Hon'ble High Court, vide reference no. 134/Rules/DHC, dated 14.05.2025, the claimant (s) are directed to produce their bank account details along with either a certificate of the banker giving all details of the bank account of the person or persons entitled to receive the compensation including IFS Code, or a copy of cancelled cheque of the bank account to this Tribunal with seven days of the date of Award, if not already placed on record. They are also directed to file their Aadhar Card and PAN Card if not already filed.
25. Directions to the Branch Manager, SBI, Saket Court Complex 25(a) The Manager, SBI, Saket Court Complex, is further MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 42 of 48 directed to verify the documents and details submitted by the claimant pertaining to their bank account, and upon proper verification, under certification of the Branch Manager (of the bank whose details have been provided by the claimant for release of the compensation amount) disburse the amount, directed to be released to the claimant, directly into the verified bank account of the claimant under notice to the Tribunal.
26 Directions with respect to Fixed Deposit:
26.(a) As per Practice Directions, Hon'ble High Court, vide reference no. 134/Rules/DHC, dated 14.05.2025, the bank shall invest the amount to be deposited in fixed deposit with any nationalised bank and fixed deposit shall be with the standing instructions to the bank to renew the same after periodical intervals till further orders are passed by the Tribunal.
26.(b) The Bank shall not permit any joint name (s) to be added in the savings bank account or fixed deposit accounts of victim i.e. the savings bank account of the claimant shall be individual savings bank account and not a joint account.
26.(c) The original fixed deposit shall be retained by the bank in safe custody. However, the statement containing FDR number, FDR amount, date of maturity and maturity amount shall be furnished by bank to the claimant.
26.(d) The monthly interest be credited by Electronic Clearing System (ECS) in the savings bank account of the claimant near the place of their residence.
26.(e) The maturity amounts of the FDR (s) be credited by Electronic Clearing System (ECS) in the savings bank account of the claimant near the place of their residence.
26(f) No loan, advance or withdrawal or pre-mature discharge be allowed on the fixed deposits without permission of the Court.
26(g) The concerned bank shall not issue any cheque book and/ or debit card to claimant (s). However, in case the debit card MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 43 of 48 and/ or cheque book have already been issued, bank shall cancel the same before the disbursement of the award amount. The bank shall debit freeze the account of the claimant so that no debit card be issued in respect of the account of the claimant from any other branch of the bank.
26(h) The bank shall make an endorsement on the passbook of the claimant to the effect, that no cheque book and / or debit card have been issued and shall not be issued without the permission of the Court and claimant shall produce the passbook with the necessary endorsement before the Court on the next date fixed for compliance.
27. SUMMARY OF COMPUTATION OF AWARD IN DEATH CASES TO BE INCORPORATED IN THE AWARD.
1. Date of accident 13.09.2017
2. Name of deceased Late Sh. Suresh Chandra Mishra
3. Age of the deceased 40 years 8 months
4. Occupation of the deceased Not proved
5. Income of the deceased Minimum wages for skilled workman at the time of accident.
28. Name, age and relationship of legal representative of deceased:
S No. Name Relation
(i) Smt. Anju Devi Wife
(ii) Ms. Priya Mishra daughter
(iii) Master Raj Mishra Minor son
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 44 of 48
(iv) Master Prem Kumar Mishra Minor son
(v) Smt. Israwati Mother of deceased
(vi) Sh. Vidhyadhar Mishra Father of deceased
29. Computation of compensation:-
S. No. Heads Awarded by the Claims
Tribunal
1 A. Income of the deceased per year (As pe Rs.1,97,616/-
Minimum Wages)
B. Add-Future Prospects (25%). Rs.49,404/-
C. Total Rs. 2,47,020/-
D. Deduction (1/4) Rs.61,755/-
E Multiplier 15
F. Yearly loss of Dependancy Rs. 1,85,265/-
G. Medical Expenses Nil
H. Deduction ,if any Nil
I. Total loss of Estate after deduction, if Rs.27,78,975/-
any
2 Compensation for loss of consortium Rs.2,90,400/-
3 Compensation for loss of estate Rs. 18,150/-
4 Compensation towards funeral expenses Rs. 18,150/-/-
5 N. TOTAL COMPENSATION Rs.31,05,675/-
total of J+K+L+M =N
6 O. RATE OF INTEREST AWARDED: @ 9% per annum
7 Award amount kept in FDRs Rs.22,00,000/-
8 Award amount released Remaining principal
award of Rs. 9,05,675/-
PLUS interest @ 7.5%
p.a.
9 Mode of disbursement of the award Release of Award
amount to the claimant (s). (Clause 29) Amount/ Disbursement MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 45 of 48
(a) Share of Wife of deceased: Out of total award amount, Rs.15,55,675/- is awarded to wife of deceased. Out of which Rs. 15,00,000/- along with proportionate (to the principle amount) up to date interest is kept in form of monthly FDR of Rs. 20,000/- each.
Remaining amount along
with proportionate up to
date interest shall be
released in her bank
account near her place of
residence.
(b) Share of Three
Children namely Priya
Mishra (aged about 18
years), Prem Kumar
Mishra (aged about 14
years) & Raj Mishra
(aged about 12 years):
Out of the total
compensation amount Rs.
3,00,000/- along with
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 46 of 48 proportionate interest is awarded to Priya Mishra;
Rs. 4,00,000/- along with
proportionate interest
awarded to Prem Kumar
Mishra; Rs. 5,00,000/-
along with proportionate
interest are awarded to
Raj Mishra. Since Priya
Mishra is major her
shared amount of Rs.
3,00,000/- along with
proportionate interest
shall he released in her
bank account near her
place of residence.
Amount of Prem Kumar
Mishra and Raj Mishra
shall be kept in form of
FDR till they turn the age
of majority.
(c) Share of mother of
deceased: Out of total
award amount,
Rs.3,00,000/- is awarded
to mother of deceased
along with proportionate
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 47 of 48 interest and whole amount shall be released to her in her bank account near her place of residence.
(d) Share of father of
deceased: Out of total
award amount,
Rs.50,000/- is awarded to
father of deceased along
with proportionate
interest and whole
amount shall be released
to him in his bank
account near his place of
residence.
10 Next Date for reporting of compliance of 10.07.2025
the award (Clause 31)
30. Copy of this award be given to the parties free of cost. The copy of award be sent to the DLSA Digitally and Ld. signed by SHELLY Metropolitan Magistrate. SHELLY ARORA Date:
ARORA 2025.06.02
16:43:46
(Pronounced in the +0530
open court on 02.07.2025)
(Shelly Arora)
PO-MACT-01 (South-East)
Saket Court/ New Delhi
02.07.2025
MACT No.893/2017 Anju Devi & Ors. Vs. Shamim & Ors. page 48 of 48