Punjab-Haryana High Court
Iffco Tokio General Insurance Company ... vs Sudesh And Others on 10 March, 2014
Author: K. Kannan
Bench: K. Kannan
FAO No. 2056 of 2010 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
Cross-Objection No. 95CII of 2010 and
FAO No. 2056 of 2010 (O&M)
Date of decision: March 10, 2014
IFFCO TOKIO General Insurance Company Ltd.
...Appellant
Versus
Sudesh and others
...Respondents
CORAM:- HON'BLE MR. JUSTICE K. KANNAN
1. Whether Reporters of local papers may be allowed to see the judgment ?
2. To be referred to the Reporters or not ?
3. Whether the judgment should be reported in the Digest?
Present: Mr. Neeraj Khanna, Advocate,
for the the appellant.
Mr. Kuldip Narwal, Advocate,
for respondents No. 3 & 4.
Mr. Neeraj Kumar, Advocate,
for respondent No. 6.
K. KANNAN, J. (Oral)
The appeal is by the insurance company against the liability cast on the insurer. Even when there was a plea that the driver did not have an effective driving licence. The licence filed in court, a copy of which is also produced before me, showed that it was purported to have been issued from the State of Nagaland on 30.7.2003 which was valid upto 29.7.2006. The accident had taken place on 23.11.2006. The Tribunal made the insurance liable on an observation that no argument was made on the issue of liability. I cannot take this to be a concession giving up of defence taken Singh Prem 2014.03.19 17:26 I attest to the accuracy and integrity of this document High Court Chandigarh FAO No. 2056 of 2010 2 in the written statement. The insurance company operates on public fund and Section 149 of the Motor Vehicle Act allows for a plea regarding the invalidity of the licence as amongst the defences permitted to be taken by the insurer. If the owner himself did not come on record to say that there was any particular document which he acted on to believe that the driver had a valid driving licence, there is no provision of law in the manner canvassed by the counsel appearing for the owner that he had full right of indemnity. I therefore, set aside the finding of the Tribunal that the insurance company is bound to provide full indemnity to the owner and the driver. As far as the liability of the insurer for a claim by a third party, it is unexceptional when it is admitted that there existed a policy of insurance at the relevant time. All that that insurer would have shall be to secure a right of recovery from the owner and the driver for violation of the terms of the policy in the manner contemplated by the decision of the Supreme Court in New India Insurance Co. Versus Kamla 2001 (4) SCC 342. The issue of liability is, therefore, modified and the appeal by the insurance company is allowed to the above extent.
Even before concluding the issue of liability, I am also to take note of an objection given by the owner, namely, the principal of the school who was admittedly the registered owner of the vehicle that he held a contract with the third party by name Sanjeev Sharma who had undertaken liability to satisfy any claim that was made during the time when he was operating the bus. Sanjeev Sharma had not been made as a party in the proceedings and any contract between the registered owner with his own contractor will be worked out as inter-se dispute between them and they cannot hold up an adjudication for a third party claim against the registered Singh Prem 2014.03.19 17:26 I attest to the accuracy and integrity of this document High Court Chandigarh FAO No. 2056 of 2010 3 owner. I, therefore, reject an argument placed on behalf of the registered owner that it should be only his own contractor who shall be made liable. The registered owner's right shall be by means of an independent suit after the amount is recovered by the insurer or by resort to a third party proceedings as contemplated under Order 8A of CPC.
The further argument that is placed is for any violation of terms of policy as regards the driver not having a valid driving licence, only driver shall be liable. This argument is only stated to be rejected as untenable for a vicarious liability is too well established to be doubted. I, therefore, reject this argument and make the owner fully responsible for recovery by the insurer, as I have found in the preceding paragraph.
There is cross-objection for enhancement of compensation. The deceased was 32 years old and the claimants were the widow, a minor child and the parents. He was said to be running a lathe on rent and the owner of the shop where the deceased was running the lathe was examined. No document is produced in proof of the deceased business which he was said to be running but there was evidence that he was technically qualified. The evidence was that he was earning about `10,000/-. The Tribunal took the income at `4800/-. I will make no modification regarding the same, but provide for prospect of 50% increase on the income taken by the Tribunal, make a deduction of 1/4th for personal expenses and apply a multiplier of 16 as suggested by the Supreme Court in Sarla Verma Versus Delhi Transport Corporation 2009 (6) SCC 121, I will also make provision of `1 lac for the loss of consortium and `1 lac for the loss of love and affection and `25,000/- for funeral expenses. The various heads of claim are tabulated as under:-
Singh Prem2014.03.19 17:26 I attest to the accuracy and integrity of this document High Court Chandigarh FAO No. 2056 of 2010 4
Fatal Accident Sunil Kumar Date of accident 23.11.2006 Age 32 Occupation Running a lath Claimants: Widow, minor child and parents Heads of claim Tribunal High Court Sr. No. Amount (`) Amount (`) 1 Income 4800 4800 2 Add, 50% of increase 3 Deduction 1/4 1/4 4 Multiplicand 3600x12 5062.50 x 12 5 Multiplier 16 6 Loss of dependence 6,91,200 10,36,800 7 Medical expenses 8 Loss of Consortium 1,00,000 9 10 Loss of love and affection for children Loss to estate } 8800 1,00,000 2500 11 Funeral Expenses 25000 Total 7,00,000 12,64,300 The total compensation payable will be `12,64,300/- and the amount in excess what has been already determined shall attract interest @ 7.5% from the date of the petition till date of payment. The amount shall be distributed amongst the widow, minor child and the parents in the ratio of 2:2:1:1. As amongst the claims, the parents shall be distributed immediately on recovery, but as regards the claim by the widow, since the accident had taken place in 2006 and I have applied a multiplier of 16, I direct 50% of the amount to be permitted to be withdrawn and the remaining 50% as regards the share of the widow, it shall be spread over for a period of eight years by splitting 50% amount into 8 portion, the 1st portion for one year and the second portion for two years and so on. The amount shall be deposited in a nationalized bank with specific direction to pay the principal amount on maturity on the respective dates without any intervention of the Tribunal, however, under proper advice to the Tribunal for disbursement to be made. Singh Prem 2014.03.19 17:26 I attest to the accuracy and integrity of this document High Court Chandigarh FAO No. 2056 of 2010 5
As regards the share of the minor the same shall be retained during his minority and shall be disbursed after attaining the majority. The interest on the principal will be paid once in three months towards maintenance and the same shall be claimed by the mother from the bank with specific instruction from the court for a direct disbursement. The award is modified and the cross-objection is allowed to the above extent.
March 10, 2014 (K.KANNAN)
prem JUDGE
Singh Prem
2014.03.19 17:26
I attest to the accuracy and
integrity of this document
High Court Chandigarh