Rajasthan High Court - Jaipur
Ram Kumar And Others vs Chatar Singh And Others on 5 April, 2019
Author: Sabina
Bench: Sabina
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
S.B. Civil Miscellaneous Appeal No. 3526/2014
1. Ram Kumar, S/o Ram Khiladi, aged 49 years,
2. Chitra, D/o Ram Kumar aged, 21 years,
3. Doli, D/o Ram Kumar aged, 20 years,
4. Kuldeep, S/o Ram Kumar aged, 17 years,
5. Shashi Bhushan, S/o Ram Kumar aged, 14 years,
Appellants No. 4 and 5 are minor through their father and
natural guardian Ram Kumar son of Ram Khiladi
All B/c Tamboli, R/o Bagrain Bareja, at present R/o Meerana
Tiraha, Madhuvan Bihar, Bayana, District Bharatpur
----Claimants-Appellants
Versus
1. Chatar Singh, S/o Moti Singh, B/c Prajapati, R/o Samugar,
Thana & Tehsil Bayana, District Bharatpur (Driver-Owner)
2. National Insurance Company Limited, Division Office At Sawai
Madhopur, having its Regional Office at Near Nidhi Bhawan, High
Court Circle, C-Scheme, Jaipur through its Regional Manager
(Insurance Company)
----Non-Claimants-Respondents
For Appellant(s) : Mr. Vinay Mathur with Mr. Ajay Verma For Respondent No.1 : Mr. Rajendra Sharma For Respondent No.2 Mr. Tripurari Sharma HON'BLE MRS. JUSTICE SABINA Judgment 05/04/2019 Appellants have filed this appeal, challenging the award dated 30.06.2014 passed by the Motor Accident Claims Tribunal, seeking enhancement of compensation amount.
Learned counsel for the appellants has submitted that the amount of compensation granted by the Tribunal is on a lower side and requires enhancement. Compensation amount has not been (Downloaded on 27/06/2019 at 10:46:02 PM) (2 of 12) [CMA-3526/2014] awarded to the appellants towards loss of future prospects. In support of his arguments, learned counsel has placed reliance on the judgment of the Hon'ble Supreme Court in National Insurance Company Limited Versus Pranay Sethi and others AIR 2017 (SC) 4973 ,wherein it was held as under:-
"39. Before we proceed to analyse the principle for addition of future prospects, we think it seemly to clear the maze which is vividly reflectible from Sarla Verma, Reshma Kumari, Rajesh and Munna Lal Jain. Three aspects need to be clarified. The first one pertains to deduction towards personal and living expenses. In paragraphs 30, 31 and 32, Sarla Verma lays down:-
"30. Though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in Trilok Chandra4, the general practice is to apply standardised deductions. Having considered several subsequent decisions of this 37 (2003) 3 SLR (R) 601 31 Court, we are of the view that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependent family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceeds six.
31. Where the deceased was a bachelor and the claimants are the parents, the deduction follows a different principle. In regard to bachelors, normally, 50% is deducted as personal and living expenses, because it is assumed that a bachelor would tend to spend more on himself. Even otherwise, there is also the possibility of his getting married in a short time, in which event the contribution to the parent(s) and siblings is likely to be cut drastically. Further, subject to evidence to the contrary, the father is likely to have his own income and will not be considered as a dependant and the mother alone will be considered as a dependant. In the absence of evidence to the contrary, brothers and sisters will not be considered as dependants, (Downloaded on 27/06/2019 at 10:46:02 PM) (3 of 12) [CMA-3526/2014] because they will either be independent and earning, or married, or be dependent on the father.
32. Thus even if the deceased is survived by parents and siblings, only the mother would be considered to be a dependant, and 50% would be treated as the personal and living expenses of the bachelor and 50% as the contribution to the family. However, where the family of the bachelor is large and dependent on the income of the deceased, as in a case where he has a widowed mother and large number of younger nonearning sisters or brothers, his personal and living expenses may be restricted to one-third and contribution to the family will be taken as two-third."
x x x x x "44. As far as the multiplier is concerned, the claims tribunal and the Courts shall be guided by Step 2 that finds place in paragraph 19 of Sarla Verma read with paragraph 42 of the said judgment. For the sake of completeness, paragraph 42 is extracted below :-
"42. We therefore hold that the multiplier to be used should be as mentioned in Column (4) of the table above (prepared by applying Susamma Thomas, Trilok Chandra and Charlie), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years."
x x x x "59. Taking into consideration the cumulative factors, namely, passage of time, the changing society, escalation of price, the change in price index, the human attitude to follow a particular pattern of life, etc., an addition of 40% of the established income of the deceased towards future prospects and where the deceased was below 40 years an addition of 25% where the deceased was between the age of 40 to 50 years would be reasonable.
x x x x x
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"61. In view of the aforesaid analysis, we proceed to record our conclusions:-
(i) The two-Judge Bench in Santosh Devi should have been well advised to refer the matter to a larger Bench as it was taking a different view than what has been stated in Sarla Verma, a judgment by a coordinate Bench. It is because a coordinate Bench of the same strength cannot take a contrary view than what has been held by another coordinate Bench.
(ii) As Rajesh has not taken note of the decision in Reshma Kumari, which was delivered at earlier point of time, the decision in Rajesh is not a binding precedent.
(iii) While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was 48 between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax.
(iv) In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component.
(v) For determination of the multiplicand, the deduction for personal and living expenses, the tribunals and the courts shall be guided by paragraphs 30 to 32 of Sarla Verma which we have reproduced hereinbefore.
(vi) The selection of multiplier shall be as indicated in the Table in Sarla Verma read with paragraph 42 of that judgment.(Downloaded on 27/06/2019 at 10:46:02 PM)
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(vii) The age of the deceased should be the basis for applying the multiplier.
(viii) Reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs.
15,000/-, Rs. 40,000/- and Rs. 15,000/- respectively. The aforesaid amounts should be enhanced at the rate of 10% in every three years."
Learned counsel has further submitted that the direction be issued to the Insurance Company to pay the amount of compensation to the appellants and thereafter, recover the same from owner of the vehicle. In this regard, l earned counsel has placed reliance on the decision of the Hon'ble Supreme Court in Shamanna and Ors. Versus The Divisional Manager, The Oriental Insurance Co. Ltd. and Ors (2018) 9 SCC 650,wherein, it was held as under:-
"In the present case, to deny the benefit of 'pay and recover', what seems to have substantially weighed with the High Court is the reference to larger Bench made by the two-Judge Bench in National Insurance Co. Ltd. v. Parvathneni and another (2009) 8 SCC 785 which doubted the correctness of the decisions which in exercise of jurisdiction under Article 142 of the Constitution of India directing insurance company to pay the compensation amount even though insurance company has no liability to pay. In Parvathneni case, the Supreme Court pointed out that Article 142 of the Constitution of India does not cover such type of cases and that "if the insurance company has no liability to pay at all, then, it cannot be compelled by order of the court in exercise of its jurisdiction under Article 142 of the Constitution of India to pay the compensation amount and later on recover it from the owner of the vehicle". The above reference in Parvathneni case has been disposed of on 17.09.2013 by the three-Judges Bench keeping the questions of law open to be decided in an appropriate case.
Since the reference to the larger bench in Parvathneni case has been disposed of by keeping the questions of law open to be decided in an appropriate case, presently the decision in Swaran Singh case followed in Laxmi Narain Dhut and other cases hold the field. The award passed by the Tribunal directing the insurance company (Downloaded on 27/06/2019 at 10:46:02 PM) (6 of 12) [CMA-3526/2014] to pay the compensation amount awarded to the claimants and thereafter, recover the same from the owner of the vehicle in question, is in accordance with the judgment passed by this Court in Swaran Singh and Laxmi Narain Dhut cases. While so, in our view, the High Court ought not to have interfered with the award passed by the Tribunal directing the first respondent to pay and recover from the owner of the vehicle. The impugned judgment of the High Court exonerating the insurance company from its liability and directing the claimants to recover the compensation from the owner of the vehicle is set aside and the award passed by the Tribunal is restored.
So far as the recovery of the amount from the owner of the vehicle, the insurance company shall recover as held in the decision in Oriental Insurance Co. Ltd. v. Nanjappan and others (2004) 13 SCC 224 where this Court held that "....that for the purpose of recovering the same from the insured, the insurer shall not be required to file a suit. It may initiate a proceeding before the concerned Executing Court as if the dispute between the insurer and the owner was the subject matter of determination before the Tribunal and the issue is decided against the owner and in favour of the insurer."
In the result, the impugned judgment of the High Court insofar as enhancement of the compensation to Rs.4,94,700/- is affirmed. Insofar as direction of the impugned judgment directing the appellants/claimants to recover the compensation from the owner of the vehicle is set aside and the appeal is partly allowed. The first respondent insurance company shall pay the enhanced compensation to the appellants/claimants along with the accrued interest and the insurance company shall recover the same from the owner of the vehicle. No costs. "
Learned counsel has next placed reliance on the decision of the Hon'ble Supreme Court in Pappu and Ors. Versus Vinod Kumar Lamba and Ors. , wherein, it was held as under:-
"The next question is: whether in the fact situation of this case the insurance company can be and ought to be directed to pay the claim amount, with liberty to recover the same from the owner of the vehicle (respondent No.1)? This issue has been answered in the case of National Insurance Company Ltd. (supra). In that case, it was contended by the insurance company that once the defence taken by the insurer is accepted by the Tribunal, it is bound to discharge the insurer and fix the (Downloaded on 27/06/2019 at 10:46:02 PM) (7 of 12) [CMA-3526/2014] liability only on the owner and/or the driver of the vehicle. However, this Court held that even if the insurer succeeds in establishing its defence, the Tribunal or the Court can direct the insurance company to pay the award amount to the claimant(s) and, in turn, recover the same from the owner of the vehicle. The three-Judge Bench, after analysing the earlier decisions on the point, held that there was no reason to deviate from the said well-settled principle. In paragraph 107, the Court then observed thus:
"We may, however, hasten to add that the Tribunal and the court must, however, exercise their jurisdiction to issue such a direction upon consideration of the facts and circumstances of each case and in the event such a direction has been issued, despite arriving at a finding of fact to the effect that the insurer has been able to establish that the insured has committed a breach of contract of insurance as envisaged under sub-clause
(ii) of clause (a) of sub-section (2) of Section 149 of the Act, the insurance company shall be entitled to realize the awarded amount from the owner or driver of the vehicle, as the case may be, in execution of the same award having regard to the provisions of Sections 165 and 168 of the Act. However, in the event, having regard to the limited scope of inquiry in the proceedings before the Tribunal it has not been able to do so, the insurance company may initiate a separate action therefor against the owner or the driver of the vehicle or both, as the case may be.
Those exceptional cases may arise when the evidence becomes available to or comes to the notice of the insurer at a subsequent stage or for one reason or the other, the insurer was not given an opportunity to defend at all. Such a course of action may also be resorted to when a fraud or collusion between the victim and the owner of the vehicle is detected or comes to the knowledge of the insurer at a later stage."
Further, in paragraph No.110, the Court observed thus:
110. The summary of our findings to the various issues as raised in these petitions are as follows:
(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third party risks is (Downloaded on 27/06/2019 at 10:46:02 PM) (8 of 12) [CMA-3526/2014] a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.
(ii) Insurer is entitled to raise a defence in a claim petition filed under Section 163A or Section 166 of the Motor Vehicles Act, 1988 inter alia in terms of Section 149(2)(a)
(ii) of the said Act.
(iii) The breach of policy condition, e.g. disqualification of driver or invalid driving licence of the driver, as contained in Sub-section (2)(a)(ii) of Section 149, have to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insured or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by duly licensed driver or one who was not disqualified to drive at the relevant time,
(iv) The insurance companies are, however, with a view to avoid their liability must not only establish the available defence(s) raised in the said proceedings but must also establish 'breach' on the part of the owner of the vehicle; the burden of proof where for would be on them.
(v) The court cannot lay down any criteria as to how said burden would be discharged, inasmuch as the same would depend upon the facts and circumstance of each case.
(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by (Downloaded on 27/06/2019 at 10:46:02 PM) (9 of 12) [CMA-3526/2014] the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/ are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under Section 149(2) of the Act.
(vii) The question as to whether the owner has taken reasonable care to find out as to whether the driving licence produced by the driver, (a fake one or otherwise), does not fulfil the requirements of law or not will have to be determined in each case.
(viii) xxx
(ix) xxx
(x) Where on adjudication of the claim under the Act the tribunal arrives at a conclusion that the insurer has satisfactorily proved its defence in accordance with the provisions of Section 149(2) read with Sub-section (7), as interpreted by this Court above, the Tribunal can direct that the insurer is liable to be reimbursed by the insured for the compensation and other amounts which it has been compelled to pay to the third party under the award of the tribunal Such determination of claim by the Tribunal will be enforceable and the money found due to the insurer from the insured will be recoverable on a certificate issued by the tribunal to the Collector in the same manner under Section 174 of the Act as arrears of land revenue. The certificate will be issued for the recovery as arrears of land revenue only if, as required by Sub-section (3) of Section 168 of the Act the insured fails to deposit the amount awarded in favour of the insurer within thirty days from the date of announcement of the award by the tribunal.
(xi) The provisions contained in Sub-
section (4) with proviso thereunder and Sub-section (5) which are intended to cover specified contingencies mentioned therein to enable the insurer to recover amount paid under the contract of insurance on behalf of the insured can (Downloaded on 27/06/2019 at 10:46:02 PM) (10 of 12) [CMA-3526/2014] be taken recourse of by the Tribunal and be extended to claims and defences of insurer against insured by, relegating them to the remedy before, regular court in cases where on given facts and circumstances adjudication of their claims inter se might delay the adjudication of the claims of the victims." (emphasis supplied) In the present case, the owner of the vehicle (respondent No.1) had produced the insurance certificate indicating that vehicle No. DIL- 5955 was comprehensively insured by the respondent No.2 (Insurance Company) for unlimited liability. Applying the dictum in the case of National Insurance Company Ltd. (supra), to subserve the ends of justice, the insurer (respondent No.2) shall pay the claim amount awarded by the Tribunal to the appellants in the first instance, with liberty to recover the same from the owner of the vehicle (respondent No.1) in accordance with law.
Accordingly, the appeal is allowed to the extent that the compensation amount awarded by the Tribunal and confirmed by the High Court shall be paid and satisfied by the insurer (respondent No.2) in the first instance, with liberty to recover the same from the owner of the vehicle (respondent No.1) in accordance with law."
Learned counsel for the respondents have opposed the appeal. Learned counsel for the Insurance Company has submitted that the direction cannot be issued to the Insurance Company to pay the compensation amount to the appellants and then, recover the same from the owner. In support of his arguments, learned counsel has placed reliance on the decision of this Court in S.B.Civil Misc. Appeal No. 1821/2007 decided on 06.02.2015 titled as National Insurance Company Ltd. Versus Batul and Ors. and S.B. Civil Misc. Appeal No. 1041/1997 decided on 23.09.2014 titled as The Oriental Insurance Co. Ltd. Versus Parmanand & Ors.
Appellants had filed the claim petition seeking compensation on account of death of Savitri in the motor vehicle accident, which had occurred on 25.06.2010.
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(11 of 12) [CMA-3526/2014] Since, the deceased was aged about 38 years, Tribunal has rightly applied multiplier of '15' to work out the amount of compensation. Deceased was a Government employee and was working as a Nurse. Claimants are the husband and minor children of the deceased.
Keeping in view the number of the claimants, Tribunal has rightly deducted 1/4th out of the income of the deceased towards her personal expenses. Tribunal has calculated the compensation amount to the tune of Rs. 29,35,620/- by applying the multiplier of '15' and after deducting 1/4th out of the income of the deceased towards her personal expenses. Appellants would be entitled to receive an addition of 50% of the said amount towards loss of future prospects of the deceased. Thus, appellants would be entitled to receive compensation amount to the tune of Rs. 29,35,620/- + Rs. 14,67,810/- (loss of future prospects) + Rs. 40,000/- (towards loss of consortium) and Rs. 15,000/- (towards funeral expenses)= Rs.44,58,430/-.
Accordingly, this appeal is allowed. Impugned award dated 30.06.2014 is modified to the extent that the claimants would be entitled to receive Rs. 44,58,430/- by way of compensation instead of Rs. 29,95,620/- as awarded by the Tribunal. Remaining terms and conditions of the award shall remain unchanged. It is further ordered that the share of enhanced amount of compensation of the appellants be invested in Fixed Deposit Receipts with some Nationalized Bank, initially for a period of three years and the interest accrued on the deposit shall be paid to the appellants on monthly basis. The Secretary, District Legal Services Authority, Bharatpur shall invest the amount in Fixed Deposit Receipts in the name of the appellants in some Nationalized Bank. The Secretary, (Downloaded on 27/06/2019 at 10:46:02 PM) (12 of 12) [CMA-3526/2014] District Legal Services Authority, Bharatpur, shall further apprise the appellants with regard to the amount which has been granted to them by way of enhancement and the fact that the enhanced amount shall be invested in Fixed Deposit Receipts in some Nationalized Bank for their benefit.
In view of the decision given by the Hon'ble Supreme Court in the judgments relied upon by the learned counsel for the appellants, it is ordered that respondent No.2-Insurance Company shall pay the compensation amount to the appellants and the Insurance Company shall be at liberty to recover the same from the owner of the company.
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