Madhya Pradesh High Court
New India Assurance Company Ltd. vs Smt. Surgyan Wd/O Omprakash Singhaniya ... on 12 September, 1997
Equivalent citations: I(1998)ACC631, 1999ACJ675, 1998(1)MPLJ328, 1998 A I H C 3337, (1998) 1 JAB LJ 35, (1998) 1 MPLJ 328, (1998) 2 TAC 200, (1998) 1 ACC 631, (1999) 1 ACJ 675, (1998) 4 CIVLJ 11
ORDER R.D. Shukla, J.
1. Appeal is directed against the judgment and Award dated 23-10-1990 of the M.A.C.T., Dewas, whereby claimants (respondents Nos. 1 to 4 here) have been awarded compensation of Rs. 3,72,000/- as compensation for the death of Omprakash Singhaniya who died in a motor accident on 6-3-1984 with a further direction that out of the amount of Award Rs. 50,000/- shall be paid by Oriental Fire and General Insurance Co. (respondent No. 7 here) and the rest of the amount Rs. 3,22,000/- shall be paid by appellant here who was non-applicant No. 5 before the Tribunal and is insurer of motor-bus No. MNP 8103.
2. This appeal has been filed by the Insurance Co. (insurer of motor-bus).
3. Brief history of the case is that on the date of accident i.e. 6- 3-1984 Omprakash was travelling in motor-bus No. MNP 8103 scheduled for Indore to Bhopal. The motor-bus was driven by Sardar Gurucharansingh (who also died in the accident) and was owned by Nandkumar (respondent No. 8 here). The motor-bus reached a place Khatamba Dargaha nearly 8 Kms. between Dewas and Sonkatch. Motor truck No. MPC 4297 driven by Rajekhan (respondent No. 6 here), owned by Batanlal Sahu (respondent No. 5 here) and insured by Oriental Fire and General Insurance Co. (respondent No. 7 here), came with a high speed. There was a collision. The driver tried to save but it was thrown nearly 100 feet away and jumped in a ditch. Omprakash a passenger of the motor-bus died in the accident. Driver of motor-bus Sardar Guru Charansingh also died in the accident.
4. Legal heirs of Omprakash (respondents 1 to 4 here) filed a claim petition after making driver, owner and insurers of both the vehicles as respondents, with assertions that accident occurred due to rash and negligent driving by Rajekhan, driver of the truck in question.
Omprakash had obtained a Post Graduate degree. He was enjoying sound health. He was a player of Tennis. He was partner of the firm and was a supplier of various articles to Military and as such was earning Rs. 50,000/- per month.
Claimants were in great pain and agony because of the death of Omprakash. They were deprived of bread-earner of the family. As such, they are entitled to a compensation of Rs. 8,00,000/-.
5. The accident was reported to Police Station 'Bank Note Press' Dewas, who registered an offence against Rajekhan, driver of motor- truck.
6. Party No. 1 i.e. driver, owner and insurer of the motor-truck contested the claim and pleaded that accident occurred due to rash and negligent driving of the vehicle by the driver of the motor-bus who was the servant of Nandkumar (respondent No. 8 here).
Party No. 2 i.e. owner of motor-bus and the insurer of bus, on the other hand, claimed that accident occurred due to rash and negligent driving of the vehicle by the driver of party No. 1 (Rajekhan, driver of motor-truck No. MPC 4297).
7. Learned Tribunal found that the accident occurred due to rash and negligent driving of the driver of motor-truck. Omprakash died in consequence thereof. As such, it was also held that all the non- applicants are jointly and severally liable for making payment of the compensation.
8. Learned Tribunal further found that income of deceased Omprakash was Rs. 18,000/- per year and assessed the dependency as Rs. 1,200/- per month. He was aged about 29 years. Average age was assessed. As such, multiplier of 31 was applied and the compensation was assessed as Rs. 3,72,000/-.
Out of compensation so assessed Oriental Fire and General Insurance Co., insurer of the motor-truck was held liable for payment of Rs. 50,000/- on the basis of limited liability under section 95 of the Motor Vehicles Act (hereinafter referred to as 'the Act'). New India Insurance Co. (appellant here) was held responsible for making the payment of rest of the amount.
Hence this appeal by the insurer of motor-bus No. MNP 8103, i.e. New India Insurance Co. Ltd.
9. Contention of Shri Dhupar, learned counsel for appellant is:-
(i) That accident occurred due to rash and negligent driving of the vehicle by the driver of motor-truck and, therefore, the liability of payment has wrongly been fastened on the owner and, insurer of motor-bus.
(ii) That, the income of deceased and dependency of claimants have been assessed on the higher side and a multiplier of 31 has wrongly been applied.
(iii) Since Omprakash was a passenger and, therefore as per the condition of policy the liability is limited to Rs. 20,000/- only.
10. Learned counsel for appellant filed copy of Insurance Policy along with memo of appeal.
11. As against it learned counsel for claimant-respondents Shri V K. Jain has submitted that defences as raised by appellant Insurance Co., is not available to them. Secondly, since appellant has not produced the policy during hearing before the Tribunal and, therefore, appellant is not entitled to produce the same at the appellate stage. The third contention of learned counsel for claimant-respondents is that appellants have rightly been held liable for making payment.
It has also been submitted that if the driver of motor-truck is held liable, claimants are entitled to recover compensation from the driver, owner and insurer of motor-truck.
12. Learned counsel appearing for the insurer of motor-truck Shri Goyal on the other hand, has submitted that the liability of Insurance Co., is limited as per the provisions of section 95 of the Act and, therefore, the maximum liability of Rs. 50,000/- has rightly been fastened on them.
13. Learned Counsel Shri Goyal has disclaimed assertions of rash and negligent driving of the vehicle by the driver of motor-truck.
14. We were taken to the evidence on record.
We would like to deal with the first objection as to whether the Insurance Policy can be produced at the appellate stage.
15. Section 96 of the Act (old) and section 149 of the new Act casts a duty on insurers to satisfy judgments against persons insured in respect of third party risks.
Section 96(2) of the Act (old) further provides that the sum shall not be paid by Insurance Co. unless it had a notice and the Insurance Co., can defend the action on grounds that the policy was cancelled by mutual consent or by virtue of any provision contained therein. Other defences provided under section 96(2) (b) of the Act (old).
16. Thus, the statute has not doubt created a liability in the insurer to the injured person but the statute has also expressly conferred a right to assail the liability on certain grounds specified therein. In view of above it is necessary that the production of Insurance Policy ought to have been insisted.
Learned Tribunal failed in its duties to get the policy produced in the court. Whether the policy covers liability in excess of that fixed by the statute, the same should be decided after getting the policy produced by the insurer.
17. A Full Bench of this High Court, as reported in 1988 MPLJ (FB) 676 = 1988 JLJ 639, United India Fire and General Insurance Co. v. Natvarlal has held as follows:- "In the interest of justice, without relying on the abstract doctrine of burden of proof, the insurance Company should produce a true copy of the policy of the Insurance. If the Insurance Company fails to do so, the Tribunal should direct the Insurance Company to produce the same. If the correctness of that copy is disputed by the claimant as a result of information obtained by him, by inspecting the policy of insurance under section 98(4) of the Act, the Tribunal should give a finding in that behalf. But to enable the Tribunal to do justice, it is absolutely necessary that in cases, where a question arises as to whether the policy of insurance covers liability in excess of that fixed by the Statute, the original policy or its true copy should be on record to put the matter beyond any pale of controversy." -x- -x- -x-
The money with the Insurance Company is afterall public money and, therefore, while fixing the liability of payment, the documentary evidence is required to be seen.
18. In view of above we accept the prayer of learned counsel for Insurance Co., and admit the policy produced at the appellate stage.
19. Our attention was drawn to Clause MVC Section II-4 - on the heading of 'Liability of third parties' and then conditions Nos. 2 and 3 which reads as follows:-
"Clause MVC Sec.II-4. The company may at its own option (A) arrange for representation at any inquest or fatal inquiry in respect of any death which may be the subject of indemnity under this section and (B) undertake the defence of proceedings in any Court of Law in respect of any act or alleged offence causing or relating to any event which may be the subject of indemnity under this section."
"Conditions. - No admission offer promise payment or indemnity shall be made or given by or on behalf of the insured without the written consent of the Company which shall be entitled if it so desires to take over and conduct in the name of the insured the defence or settlement of any claim or to prosecute in the name of the insured for its own benefit any claim for indemnity or damages or otherwise and shall have full discretion in the conduct of any proceedings or in the settlement of any claim and the insured shall give all such informations and assistance as the Company may require.
3. At any time after the happening of any event giving rise to a claim under section 11 of this policy the Company may pay to the insured the full amount of the company's liability under that section and relinquish the conduct of any defence settlement or proceedings and the Company shall not be responsible for any damage alleged to have been caused to the insured in consequence of any alleged action or omission of the Company in connection with such defence settlement or proceedings or of the Company relinquishing such conduct, nor shall the Company be liable for any costs or expenses whatsoever incurred by the insured or any claimant or other person after the Company shall have relinquished such conduct." -x- -x- -x-
A plain reading of these conditions would show that Insurance Co. has reserved that right of undertaking the defence available to the owner and the driver of the vehicle.
20. This is pertinent to note that in this case a joint Written Statement was filed by Non-applicants Nos. 4 and 5 (Appellant here). No Written Statement was filed by Non-applicants Nos. 1 and 3 (i.e. owner and driver of the truck).
It would further be observed here that according to the Act of 1988 Insurance Co., is required to take written permission for raising defence plea on behalf of the owner of the vehicle but this accident occurred prior to coming into force of the amended Act and, therefore, the provisions of old Act would apply.
21. Similar question was raised before the Division Bench of this Court where one of us (Justice R. D. Shukla) was a member, in MA No. 221/88, The New India Assurance Co. Ltd. v. Mohinibai and it was held that the defences as per the conditions laid down in the policy are opened to Insurance Co. (appellant here). We reiterate the same view here also.
22. The next question that arise for determination now is as to what driver was responsible for the accident and to what extent?
The claimants have examined C.W 3 Dipendra Sanghvi who was a passenger in the ill-fated motor-bus. He has stated that the motor-bus was in normal speed. The truck was coming from opposite side. It had a full load of bags containing grams. The gunny bags were bulging out of the motor-truck body. The motor-truck was on the middle of the road and did not give side. As such, there was collision. The motor-bus turtled down in a ditch after running about 100 feet. The impact was so high that steering pierced inside the body of the driver of motor-bus who died. Almost all the passengers of the motor-bus sustained injuries. A passenger who was behind the driver also sustained serious injuries. He could be taken out of the bus with great difficulty and sent to Dewas, but he died.
23. C.W. 4 Dr. R. C. Mundada conducted autopsy on the body of Omprakash. C.W. 5 Navneetlal identified the body. Panchnama was also prepared. C.W. 1 Harishchandra Singhania father of deceased Omprakash had also stated that Omprakash died in that accident.
24. Challan after due investigation in the case was filed against Rajekhan, driver of motor-truck.
Rajekhan was examined as DW-1. He has on the other hand stated that the two buses were coming from opposite side. They were trying to over- take each other. One motor-bus passed safely and the other motor-bus which was racing, dashed against the motor-truck. This contention of Rajekhan cannot be accepted as no written-statement has been filed. This fact has also not been mentioned in the WS. filed by Insurer of the motor-truck (respondent No. 7 here).
25. We have perused site-map prepared on the spot, during investigation of the case by police Dewas. The same has been proved as Ex. P/52. The site-map has been proved in Criminal case as Ex. P/2. This site-map shows that the motor-truck was almost on the middle of the road. About 2 1/2 feet a tar road was lying open on the left-side of the truck. There is no rebuttal to the assertions of claimants' witness C.W. 3 Dipendra Sanghvi that the loaded gunny bags were hanging out-side the body of the truck. The map Ex.P/2 (P/52) further shows that motor-bus was after collision had gone 100 feet away. It is the principle of Rules of the road that heavy goods vehicle are required to give pass to the passenger vehicle and after locating the incoming passenger vehicle it is the duty of the driver of heavy motor-vehicle to leave sufficient space for the passenger- bus to pass. It was a dry season. There was no chance of skating because of a wheel being taken out of the tar road. In our opinion, therefore, the driver of motor- truck did not take care and precaution to avert the accident. He did not avail the last opportunity of averting the accident. On the other hand the driver of motor-bus tried to avert accident and it was for this reason that the motor-bus ran about 100 feet away after collision with no injury to the driver of motor-truck.
26. It is also pertinent to note that the driver of the motor-bus did not lower the speed or else the impact would not have been such high.
Though it is also true that mere driving of the vehicle in a high speed would not amount to rash and negligent driving but in this case the driver of the motor bus must have located the incoming truck and, therefore, he should have also taken precaution to avert the accident and should have maintained sufficient margin or space for averting the collision and accident. In our opinion, therefore, the liability of accident lies on the driver of motor-truck which would be quantified as 3/4th and it is the l/4th liability which lies on the driver of motor- bus.
27. Learned Tribunal has assessed the dependency to Rs. 1,000/- per month, age of deceased 29 years and applied a multiplier of 31.
28. It is submitted on behalf of appellant that the multiplier has wrongly been applied.
As against it learned counsel for claimants submitted that the income of deceased has been assessed on the lower-side.
29. We have perused the evidence. CW. 1. Harishchandra Singhania, father of deceased Omprakash has stated that he has obtained a Post- graduate degree (MA) (Ex.P/1). He was a player and was taking part in extra activities. He produced documents Ex.P/3 to Ex. P/34. He has further stated that he had started the Rope Factory in Seoni (MP) and was supplying food grains to Military. The business was being conducted in the name of Firm "Sethmal Jainarain" He has produced Ex. P/35, P/36 and P/37. He has not given his own calculation of income of deceased.
C.W. 2 Surgyan, widow of deceased has stated that Omprakash was earning nearly Rs. 50,000/- per year.
30. Looking to the work undertaken by Omprakash and his qualifications and the year of accident i.e. 1984 the income of Omprakash cannot be taken less than Rs. 2,500/- per month i.e. Rs. 30,000/- per year. If 1/3rd amount is deducted towards his personal expenditure, the dependency of the family would come to Rs. 20,000/- per year.
31. Learned Tribunal has applied a multiplier of 31 which in our opinion is wrong. In our opinion, maximum multiplier of 14 ought to have been applied in the case; as deceased was aged about 29-30 years. [Reference may be had to a case reported in 7994 MPLJ 520 = AIR 1994 SC 1631, K.S.R.T.C. v. Susamma Thomas.] Thus, a total compensation awardable as general damages come to Rs. 20,000/- x 14 = 2,80,000/-.
32. The claimant No. 1 is the widow, claimant No. 2 is minor son and claimants Nos. 3 and 4 are the parents of deceased Omprakash. In our opinion Rs. 5,000/- for the loss of consortium to claimant No. 1 and Rs. 3,000/- each to claimants Nos. 2, 3 and 4 would be the proper compensation awardable on the heading of loss of consortium, love and affection. The claimants should further be entitled for expenses of last rites and for bringing the body of Omprakash from the place of incident to Indore. An amount of Rs. 6,000/- in all would be proper compensation on this heading.
Thus, total compensation awardable comes to Rs. 2,80,000/- + Rs. 14,000/- + Rs. 6,000/- = Rs. 3,00,000/-.
33. It has been submitted on behalf of the appellant that the income and dependency of claimants cannot be examined in the absence of any appeal by the claimants.
We do not agree with this contention of learned counsel for appellant as the appellant itself has challenged the quantum specially the application of multiplier.
34. Even otherwise, when the quantum is under challenge the claimants are entitled to show and demonstrate that the income and dependency has not been properly assessed. Thus, in our opinion, Rs. 3,00,000/- would be just and proper compensation.
35. Claimants are further entitled to interest @ 12% per annum from the date of application till realisation.
36. The next point that arise for determination is as to what would be the liability of each of the respondents. Since, driver of truck has been held responsible for the accident to the extent of -"3/4th and, therefore, Rs. 2,25,000/- would be payable by the owner, driver and the insurer of the truck.
37. Counsel for respondent No. 7 Shri Goyal has submitted that the liability of Insurance Co., in the case is limited and learned Tribunal has rightly found the liability to the extent of Rs. 50,000/- only.
As against it learned counsel for claimants has submitted that the Insurance Company would be liable to pay whole of compensation and has placed reliance on the case reported in 1995 ACJ 962, Oriental Insurance Co. Ltd. v. Chhotibai, (Division Bench of this Court Bench at Gwalior) and has also placed reliance on an unreported judgment passed in MA.. No. 85/89, The New India Assurance Co. Ltd. v. Hussaina Bee by a Division Bench of this Court (Bench Indore).
38. In the two cases reported above it has been held that in the policy under section II-I(i) no limit has been prescribed for bodily injury and the word 'such amount as is necessary to meet the requirements of Motor Vehicles Act, 1939' cannot be read as requirements of section 95 only and the expression covers the entire liability of the owner if incurred under the provisions of Motor Vehicles Act, 1939 and in view of above, it has been held that the Insurance Co., is liable to make payment of the whole compensation which the owner of vehicle is otherwise liable to pay.
39. As against it learned counsel for respondent No. 7 Shri Goyal has referred to a case reported in 1995 JLJ 331, New India Assurance Co. Ltd. v. Shantibai (A Supreme Court decision) whereby it has been held that under section 95(2)(b)(ii) of the Act the liability of insurer would be to Rs. 15,000/- per passenger.
40. In a case reported in 1994 ACJ 622, New India Assurance Co. Ltd. v. Anil Mathew the Apex Court of this country disapproved the order of the High Court where the High Court has directed the Insurance Co. to pay whole of the amount of compensation despite the limit of Rs. 50,000/- with a further direction that the Company can recover the same from the owner of the vehicle.
41. Another Division Bench of this High Court (at Jabalpur) as reported in 1996 ACJ 1273, New India Assurance Co. Ltd. v. Chandravati has held that the Insurance Co. had covered the liability as per the statutory limits.
42. It was then submitted by the claimants that the insurance was comprehensive and, therefore, the liability would be unlimited.
We do not agree with this contention of the learned counsel for the claimant. As per section 95(2)(b)(ii) of the Act the comprehensive insurance of the vehicle entitles the owner to claim reimbursement the damage suffered by the vehicle. It does not mean that the limit of liability with regard to third party risk becomes unlimited and higher than the statutory liability. 1988 ACJ 270.
43. Similar view has been taken by three Judges of the Apex Court in a case reported in 1995 JLJ 331, Shanti Bai (supra) that the comprehensive policy does not cover the unlimited liability in respect of third party claim. The owner of vehicle can claim damages caused to vehicle.
In a case reported in (1988)1 SCC 626, National Insurance Co. Ltd. v. Jugal Kishore, the Apex Court of this country has held that in the absence of any specific agreement undertaking any liability in excess of the statutory limit and payment of separate premium therefor, insurer's liability would be confined to that provided in the statute. The maximum liability under section 95(2)(b) of the Act at the time of accident was Rs. 1,50,000/-.
44. In view of above decisions of the Supreme Court referred above, the view taken by the Division Bench of Gwalior Bench and other Division Bench of this High Court Bench at Indore does not state the correct law.
The requirement of the Act of 1939 does not make it comprehensive. Section 95(2)(a) and (b) are specific provisions within the Act and since special provision has been made regarding limited liability, that will have to be followed for implementation of the legislative intent.
45. It is note worthy that now the provision stands amended after coming into force of the new Act of 1988 and the liability with respect to third party is unlimited. But as this accident occurred in the year 1984, the provision of limited liability would be attracted. It may further be mentioned it here that there was amendment in section 95 of the Act w.e.f. 1-10-1982 and the limited liability was extended to Rs. 1,50,000/-.
46. Learned counsel for respondent No. 7 was also considered on this point. In such a situation, the liability of respondent No. 7 in the case would be limited to Rs. 1,50,000/- with interest @ 12% p.a. from the date of application till realisation.
47. The rest of the amount would be payable by the owner and driver of the vehicle who have been shown as respondents Nos. 5 and 6 in this appeal.
48. Now, so far as the liability of appellant is concerned the same was limited to Rs. 20,000/- only. As no extra premium per passenger was paid and as neither there was any pleading or proof regarding the same and therefore, the appellant would be liable to make payment of Rs. 20,000/- as Omprakash was a passenger in the motor-bus.
The rest of the amount shall be payable by owner of the vehicle i.e. Nandkumar Bhatia who is shown as respondent No. 8 in the appeal.
49. As a result, appeal succeeds partly. The amount of compensation is reduced to Rs. 3,00,000/- with interest @ 12% per annum from the date of application till realisation of the same.
50. Out of the amount so awarded Rs. 1,50,000/- with interest @ 12% p.a. from the date of application till realisation shall be paid by respondent No. 7 Oriental Fire and General Insurance Co. Ltd. Rs. 75,000/- + interest @ 12% p.a. from the date of application till realisation shall be paid by respondents Nos. 5 and 6 i.e. owner and driver of the truck. Out of 1/4th amount i.e. Rs. 75,000/- an amount of Rs. 20,000/- with interest @ 12% p.a. from the date of application till realisation shall be paid by appellant The New India Assurance Co. Ltd. Rest of the amount i.e. Rs. 55,000/- + interest @ 12% p.a. from the date of application till realisation shall be paid by respondent No. 8, owner of the bus Nandkumar Bhatia.
Parties shall bear their own costs.
Counsel fee is quantified as Rs. 1,000/-.