Delhi High Court
New India Assurance Company Ltd. vs Smt.Sunita Bhandari And Ors. on 17 September, 2008
Author: Mool Chand Garg
Bench: Mool Chand Garg
* IN THE HIGH COURT OF DELHI AT NEW DELHI
+ MAC.APP. 452/2008
% Date of decision: 17.09.2008
New India Assurance Company Ltd. ..... APPELLANT
Through: Mr.Rakesh Mittal, Adv.
Versus
Smt.Sunita Bhandari and Ors. .... RESPONDENTS
Through: Mr.V.P.Choudhary, Sr.Adv. with
Mr.Nitinjya Choudhary, Adv. for R 1 to 3
CORAM:
HON'BLE MR. JUSTICE MOOL CHAND GARG
1. Whether the Reporters of local papers Yes
may be allowed to see the judgment?
2. To be referred to Reporter or not? Yes
3. Whether the judgment should be Yes
reported in the Digest?
MOOL CHAND GARG, J. (ORAL)
1. This appeal has been filed by the Appellant/Insurance Company against an award given by the MACT dated 11th March, 2008, whereby Namita Bhandari, the deceased, aged about 8 years, who was studying in Geeta Bal Bharti School, situated at Krishna Nagar, East Delhi while going through narrow passage situated by the side of the building of the school to drink water was hit by the truck passing by the side and in the process, MAC.App.No.452/2008 Page 1 of 10 deceased Namita Bhandari was crushed between the rear portion of the Truck and the wall. The truck bearing No.DHG-3272, which caused the accident was being driven by Trilok Raj, who was impleaded as respondent No.3 in the accident claim petition. The truck was owned by Sh. Vijay Pal Singh, who was impleaded as respondent No.2, who has since died and his legal heirs were brought on record.
2. The Tribunal after taking into consideration the evidence which came on record and after hearing the parties, decided to award a compensation to the legal heirs of the deceased to the tune of Rs.4,60,005/- (inclusive of the interim award of Rs.50,000/- passed on 23rd September, 1999) along with interest @ 9% p.a. from the date of filing of the petition i.e. 19th February, 1996 till realization. The compensation was awarded by taking prospective notional income of child @ Rs. 40,000/- per annum and by taking multiplier of 15.
3. The appellant assailed the impugned award primarily on the following grounds:-
(i) that the accident has taken place inside the school which is not a „public place‟.
(ii) that the compensation awarded in the case of minor is violative of the law laid down by the Hon‟ble Supreme Court in Kaushalaya Devi v.
Karan Arora & Ors. [2007] ACJ 1870, where in respect of children who succumb to such accident up to the age of 14 years, it was stated that a composite compensation of not more than 1 lac is to be awarded.
LPA 501/2004 Page 2 of 10
(iii)that in this case, a compensation at the most should have been awarded by calculating the notional income of the child at Rs.15,000/- p.a.
4. Learned counsel appearing on behalf of the respondent has refuted all three points and have also questioned the maintainability of the appeal, in view of the appellant having not taken permission of the trial court to defend the matter before the stage of evidence by filing an appropriate application under Section 170 of the Motor Vehicles Act, at the relevant time.
5. It is not disputed that the application was filed by the appellant only on 4th March, 2008, which is the date when arguments were heard and the case was listed for pronouncement. The application stands dismissed. No appeal against the said order has been filed.
6. It is submitted by learned Senior Counsel appearing on behalf of the respondent that the Insurance Company can take defences which were available to the insured only by moving an application under Section 170 and seeking permission from the Tribunal at the appropriate time i.e. before the evidence is recorded. In case the application filed subsequently, then it is of no consequence.
7. Reliance has been placed upon a judgment of the Hon‟ble Supreme Court in the case of National Insurance Company Ltd. v. Nicolletta Rohtagi and Ors. [2002] ACJ 1950. The relevant portion of the aforesaid judgment which further seeks reference has been produced as under:-
MAC.App.No.452/2008 Page 3 of 10
"31. We have already held that unless the conditions precedent specified in section 170 of 1988 Act are satisfied, an insurance company has no right of appeal to challenge the award on merits. However, in a situation where there is a collusion between the claimants and the insured or the insured does not contest the claim and, further the Tribunal does not implead the insurance company to contest the claim in such cases it is open to an insurer to seek permission of the Tribunal to contest the claim on the grounds available to the insured or to a person against whom a claim has been made. If permission is granted and the insurer is allowed to contest the claim on merits and in that case it is open to the insurer to file an appeal against an award on merits, if aggrieved. In any case, where an application for permission is erroneously rejected the insurer can challenge only that part of the order while filing an appeal on grounds specified in sub-section (2) of section 149 of 1988 Act. But such application for permission has to be bona fide and filed at the stage when the insured is required to lead his evidence. So far as obtaining compensation by fraud by the claimant is concerned, it is no longer res-integra that fraud vitiates the entire proceeding and in such cases it is open to an insurer to apply to the Tribunal for rectification of award.
32. For the aforesaid reasons, our answer to the question is that even if no appeal is preferred under section 173 of 1988 Act by an insured against the award of a Tribunal, it is not permissible for an insurer to file an appeal questioning the quantum of compensation as well as findings as regards negligence or contributory negligence of the offending vehicle."
8. It will also be appropriate to take note of Section 170 of the Motor Vehicles Act, which reads as under:-
"170. Impleading insurer in certain cases- Where in the course of any inquiry, the Claims Tribunal is satisfied that-LPA 501/2004 Page 4 of 10
(a) there is collusion between the person making the claim and the person against whom the claim is made, or
(b) the person against whom the claim is made has failed to contest the claim, it may, for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaded as a party to the proceeding and the insurer so impleaded shall thereupon have, without prejudice to the provisions contained in sub-
section (2) of section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made."
9. It is a matter of record that in this case, the driver had not put in appearance and the owner of the vehicle also expired, but in his place his legal heirs were substituted. Even though respondent No.2 i.e. the owner filed a written statement but no evidence has been led on their behalf. Under these circumstances, ordinarily, the appellant would have been entitled to seek the leave of the Court to take all these defences which are available to the insured provided an application was filed at an appropriate time, but it has not been done. Further, in this appeal also, no ground has been taken to assail the order dismissing the application of the appellant which of course has been dismissed by the Tribunal after the pronouncement of the award, which also cannot be appreciated.
10. Be that as it may, the two main grounds which the appellant has raised to avoid their liability i.e. the accident having taken place at a place inside the school which according to them is not MAC.App.No.452/2008 Page 5 of 10 a public place and further that the compensation awarded on account of death of the minor is contrary to the second schedule have no legs to stand in the present case.
11. Firstly, I may refer to two judgments cited on behalf of respondents to deal with the first point i.e. the judgment delivered by Division Bench of the Madras High Court in the case of G. Bhuvaneswari and Ors. v. M. Sornakumar and Ors. [2000] ACJ 1343.
12. In the aforesaid case, a similar argument was addressed, when in relation to an accident which took place inside the factory where the victim had been working, it was argued that since the accident took place inside the factory, the Insurance Company or the owner were not liable to compensate to the family of the deceased. Rejecting the aforesaid contention, the Division Bench made following observations:-
"5. Learned counsel for the appellants/claimants submitted that even if the accident had happened in the private place, the place is accessible to the members of the public and is available for their use, enjoyment and avocation, it is a public place and not a private place, as the other people have got right of entry. He places reliance on the decision of the Full Bench of this Court in the case of United India Insurance Co. Ltd. v. Parvathi Devi, 1999 ACJ 1520 (Madras), wherein this Court has held that public place includes place where public have an access whether free or controlled in any manner.
6. In the instant case, the accident had happened in the factory premises. The place is accessible to the members of the public and available for the use of public, who have dealings LPA 501/2004 Page 6 of 10 with the factory. Following the decision of the Full Bench of this Court, we are of the view that the place where the occurrence had happened is a public place and the respondent No.2 insurance company is liable to pay the compensation as per the provisions of the Act."
13. A similar view has been taken by a Full Bench of the Madras High Court in the case of United India Insurance Co. Ltd. v. Parvathi Devi and Ors. [1999] ACJ 1520. The relevant portion of which, reads as under:-
"16. The definition of „public place‟ is very wide. A perusal of the same reveals that the public at large has a right to access though that right is regulated or restricted. It is also seen that this Act is beneficial legislation, so also the law of interpretation has to be construed in the benefit of public. In the overall legal position and the fact that if the language is simple and unambiguous, it has to be construed in the benefit of the public, we are of the view that the word „public place‟, wherever used as a right or controlled in any manner whatsoever, would attract section 2 (24) of the Act. In view of this, as stated, the private place used with permission or without permission would amount to be a „public place‟.
17. In view of what we have discussed above, we hold that the expression „public place‟ for the purpose of Chapter VIII of the Motor Vehicles Act, 1939 will cover all places including those of private ownership where members of the public have an access whether free or controlled in any manner whatsoever."
14. In this case, „School‟ cannot be excluded from the definition of public place for similar reasons as aforesaid. Thus, the arguments of learned counsel for the appellant regarding accident have not taken place in a public place cannot be MAC.App.No.452/2008 Page 7 of 10 accepted.
15. As regard to the second point, regarding the adequacy of compensation, firstly, in view of the judgment of the Hon‟ble Supreme Court in the case of National Insurance Company v. Nicolletta Rohtagi (supra), the application of the respondent having not been allowed under Section 170 of the Motor Vehicles Act, as it was not moved in an appropriate time, the appellant is not entitled to raise any plea regarding adequacy of compensation or the adequacy of quantum of compensation. Secondly, the Tribunal while deciding compensation has dealt with the judgment of the Hon‟ble Supreme court in the case of Kaushalaya Devi v. Karan Arora & Ors.(supra.) The relevant observations made in this regard are reproduced hereunder:-
"12. On behalf of R1/Insurance Company, reliance has been placed on a case decided by Hon‟ble Supreme Court recently reported as Kaushalya Devi v. Karan Arora & Ors., 2007 ACJ 1870 and it was argued on behalf of R1/Insurance Company that in cases of children up to the age of 14 years, a composite compensation of not more than one lac is to be awarded. In the said case, Hon‟ble Supreme Court had just refused to interfere in the matter in view of death of one of the parents of the deceased minor and in view of the facts of the case and no maximum compensation as such was fixed. The family background and environment can only help to a limited extent in determining or estimating the expected income of a child at a later stage in life and in case, disproportionate weightage is to be given to the family environment for awarding compensation in the cases of death of children or minors, the same shall result in disproportionate inequalities in awarding compensation as in the cases where an adult is not able to prove his or her earnings, LPA 501/2004 Page 8 of 10 normally minimum wages applicable for the class of persons to which that person belong is taken as the basis for computation and in cases, future earnings are estimated on the basis of family environment and expectations of the parents, then it shall result in serious inequalities. As per IInd Schedule in reference to Section 163-A of M.V. Act, notional income for compensation to those who had no income prior to the accident is to be taken as Rs.15,000/- p.a., in view the fact that structured formula as per second schedule has been provided for cases where fault of the driver of the offending vehicle is not alleged to avoid the delay, particularly in cases where the annual income of the deceased or injured is less than Rs.40,000/- p.a. and also keeping in view the fact that IInd schedule was inserted in the Motor Vehicles Act in year 1994 and since then, there has been tremendous rise in cost of living."
16. Another important distinction which has been taken note of by the Tribunal while deciding the aforesaid appeal that the grant of notional compensation under Section 163 A of the Motor Vehicles Act at fixed amount in a case of no fault liability which is not the case in hand. Hence, even the second and third argument raised on behalf of the appellant does not stand.
17. Taking all these facts into consideration, the appeal filed by the appellant is dismissed.
18. The award amount be deposited before the Tribunal with interest @ 9% p.a. within three months from today failing which it will carry further interest @ 12% p.a., on the awarded amount included interest.
19. No order as to costs. Lower Court record be sent back forthwith.
MAC.App.No.452/2008 Page 9 of 10 CM No. 11456/2008 (stay) In view of the orders passed above, the application does not survive and is disposed of accordingly September 17, 2008 MOOL CHAND GARG, J.
rs LPA 501/2004 Page 10 of 10