Karnataka High Court
Regional Manager vs Smt Vidya Kadari on 9 September, 2020
Bench: S.Sujatha, Jyoti Mulimani
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 09TH DAY OF SEPTEMBER, 2020
PRESENT
THE HON'BLE MRS.JUSTICE S.SUJATHA
AND
THE HON'BLE Ms. JUSTICE JYOTI MULIMANI
M.F.A.No.876/2016 C/w.
M.F.A.No.480/2016 (MV-D)
IN MFA No.876/2016:
BETWEEN:
REGIONAL MANAGER
NATIONAL INSURANCE CO. LTD.
REGIONAL OFFICE, SUBHARAM COMPLEX,
144, M.G.ROAD, BANGALORE-01. ...APPELLANT
(BY SRI. A.N.KRISHNA SWAMY, ADV. )
AND
1. SMT VIDYA KADARI
W/O LATE VENKATA RAMANUJULU
NOW AGED ABOUT 33 YEARS
2. MT.M.E.HEMALATHA
W/O LATE M. EMBAR
NOW AGED ABOUT 71 YEARS
3. ASTER SUSHANTH SRINIVAS
S/O LATE VENKATA RAMANUJULU
NOW AGED ABOUT 2 YEAR 5 MONTHS
SINCE MINOR REP BY NATURAL
GUARDIAN/MOTHER 1ST RESPONDENT HEREIN
-2-
ALL ARE R/AT NO. 151, FLAT No.3,
PVR BUILDING, 21ST MAIN,
HSR LAYOUT, 1ST SECTOR,
BANGALORE-560102.
PERMANENT RESIDENTS OF
No.43/5510,WARD No.22,
THANTHAI PERIYAR STREET,
RAJAJIPURAM,THIRUVALLUR,
TAMILNADU.
4. ASHIR AHMED HALBHAVI
S/O MOHIDDIN, MAJOR
#32, HALBHAVI ROAD, MALAPUR,
DHARWAD DISTRICT 580 003. ...RESPONDENTS
(BY SRI. SHRIPAD V SHASTRI, ADV. FOR C/R1 & ALSO
FOR R-2 AND R-3;
V/o DATED 11.04.2016, NOTICE TO R-4 DISPENSED WITH)
THIS M.F.A. IS FILED UNDER SECTION 173(1) OF
M.V.ACT AGAINST THE JUDGMENT AND AWARD DATED
27.8.2015 PASSED ON MVC No.719/2014 ON THE FILE OF
THE XIX ADDL. SMALL CAUSES AND XLI ACMM, MACT,
BENGALURU, AWARDING COMPENSATION OF
RS.49,83,232/- WITH INTEREST @ 6% P.A. FROM THE
DATE OF PETITION TILL ITS REALISATION.
IN MFA No.480/2016:
BETWEEN:
1. VIDYA KADARI
W/O VENKATA RAMANUJULU,
AGED ABOUT 32 YEARS
2. M.E.HEMALATHA
W/O. LATE M.EMBAR,
AGED ABOUT 70 YEARS,
-3-
3. MASTER SUSHANTH SRINIVAS
S/O SRI. VENKATA RAMANUJULU,
AGED ABOUT 1 YEAR 5 MONTHS,
(SINCE MINOR REPRESENTED BY MOTHER
AND NATURAL GUARDIAN SMT.VIDYA KADARI)
ALL ARE R/AT No.151, FLAT No.3,
PVR BUILDING, 21ST MAIN,
HSR LAYOUT, I SECTOR, BANGALORE-102.
PERMANENT RESIDENTS OF
No.43/5510, WARD No.22,
THANTHAI PERIYAR STREET,
RAJAJIPURAM, THIRUVALLUR,
TAMILNADU. ...APPELLANTS
(BY SRI. SHRIPAD V SHASTRI, ADV. )
AND
1. BASHIR AHMED HALBHAVI
S/O MOHIDDIN,
No.32, HALBHAVI ROAD,
MALAPUR,
DHARWAD DISTRICT-580 001.
2. NATIONAL INSURANCE CO. LTD
REGIONAL OFFICE,
No.144, SHUBHARAM COMPLEX,
M.G. ROAD, BANGALORE-01
BY ITS MANAGER. ...RESPONDENTS
(BY SRI. A.N. KRISHNA SWAMY, ADV. FOR R2;
V/o DATED 26.9.16 NOTICE TO R1 DISPENSED WITH)
THIS M.F.A. IS FILED UNDER SECTION 173(1) OF
M.V.ACT AGAINST THE JUDGMENT AND AWARD DATED
27.8.2015 PASSED IN MVC No.719/2014 ON THE FILE OF
THE XIX ADDL. SMALL CAUSE JUDGE, MACT AND XLI
ACMM, BANGALORE, PARTLY ALLOWING THE CLAIM
-4-
PETITION FOR COMPENSATION AND SEEKING
ENHANCEMENT OF COMPENSATION.
THESE APPEALS HAVING BEEN HEARD AND
RESERVED ON 24.08.2020, COMING ON FOR
PRONOUNCEMENT OF JUDGMENT THIS DAY,
S.SUJATHA, J., DELIVERED THE FOLLOWING:
JUDGMENT
The insurance company as well as the claimants are before this Court challenging the judgment and award passed by the Motor Accidents Claims Tribunal ['Tribunal' for short], Bengaluru in MVC No.719/2014 dated 27.08.2015.
2. The facts leading to these appeals in a nutshell are as under:
Claimants preferred claim petition under Section 166 of the Motor Vehicles Act, 1988 ['Act' for short] claiming compensation for the death of Venkata Ramanujulu in the road traffic accident which occurred on 27.12.2013 at about 12.30 midnight. The claimants contended that the deceased Venkata Ramanujulu was -5- driving the car bearing registration No.KA-01-MS-4763 along with his wife, daughter and his friend Mysore Reddy on the ill-fated day. They were proceeding from Bangalore to Goa on NH-63. When they reached near Hillur Cross, Ankola Taluk, Uttara Kannada District, a lorry bearing registration No.KA-22-A-4328 ['Offending vehicle'] came from opposite side in a high speed and dashed against the car, as a result of which, Venkata Ramanujulu and the daughter Shraddha Mahalakshmi died at the spot. MVC No.719/2014 was filed by the claimants claiming compensation for the death of Venkata Ramanujulu, claiming to be the wife, mother and son of the deceased Venkata Ramanujulu; wife of deceased Venkata Ramanujulu filed MVC No.720/2014 relating to the death of her child owing to the accidental injuries and MVC No.721/2014 claiming compensation for the injuries sustained by her in the accident in question. Common judgment dated 27.08.2015 was passed by the Tribunal in the aforesaid cases. The -6- present appeals arise against the judgment and award passed in MVC No.719/2014.
3. It was contended that the deceased was working as a Senior Engineer at Century Link Technologies India Pvt. Ltd., Sallarpuria, Hallmark Block, B.Kadubeesanahalli, Bangalore and was drawing salary of Rs.41,648/- per month. The claimants being the legal representatives of the deceased were totally depending upon the income of the deceased. The claimants alleged actionable negligence on the part of the driver of the offending vehicle which is duly insured with the insurer.
4. Respondents in MFA No.480/2016 on issue of notice appeared and contested the matter. Respondent No.1 (owner of the vehicle) had filed written statement denying the contention of the claimants and submitted that the offending vehicle was insured with the insurer and the policy was in force. The driver of -7- the offending vehicle also had a valid and effective driving licence at the time of the accident. Hence, if there is any liability on his part, it is to be indemnified by the insurance company. Insurer filed written statement by denying the claim petition averments. It was contended that there was no negligence on the part of the driver of the offending vehicle.
5. On the basis of the pleadings, the Tribunal framed issues and answered as per the reasons recorded in the impugned judgment. The claim petition was allowed in part. Compensation of Rs.49,83,232/- with interest at 6% p.a. from the date of petition till its realization was awarded. The liability was fixed on the insurer. Out of the award amount determined as aforesaid, apportionment was made to the claimant No.1 to the extent of 50%, 20% to the claimant No.2- mother and 30% to the claimant No.3-son aged about -8- five months represented by mother and natural guardian - claimant No.1.
6. Being aggrieved by the quantum of compensation awarded by the Tribunal, the insurer is before this court primarily challenging the award of future prospects on the ground that the deceased had no stable/permanent job. The Tribunal ought to have restricted the future prospects if any, to the extent of 40% and not 50%. Secondly, on the ground that the Tribunal ought to have deducted a sum of Rs.10,27,860/- from the total compensation awarded in view of the fact that the said amount was received by the claimants from and out of group accident policy of insurance procured by the employer of the deceased Venkata Ramanujulu.
7. In support of his contentions, learned counsel has placed reliance on the following judgments. -9-
1. Mrs. Heien C. Rebello and others Vs. Maharashtra State Road Transport Corporation and another (AIR 1998 SC 3191(1)).
2. United India Insurance Company Limited Vs. Mrs.Patricia Jean Mahajana and others (AIR 2002 SC 2607)
8. The claimants have preferred MFA No.480/2016 averring that the quantum of compensation awarded is inadequate and not in consonance with the evidence on record. It was argued that the deceased was drawing Rs.42,820/- towards monthly salary duly established by the oral as well as documentary evidence. The Tribunal without appreciating the same determined the monthly income of the deceased at Rs.25,121/- which resulted in granting the compensation on the lower side. It was argued that I.A.No.3/2016 filed by the insurer on 11.2.2016 is belated. No additional documents can be taken on record at the belated stage, as such the same
- 10 -
requires to be rejected at the threshold on delay and laches. It was argued that though the personal accident claim contribution was made through the employer, the same forms part of the salary of the employee. No deduction is required to be made for the compensation received by the claimants towards the personal accident claim compensation. Placing reliance on the judgment of the Hon'ble Apex Court in the case of Mrs. Heien C. Rebello supra, it was submitted that the amount received by the claimants under group personal accident claim settlement for which premium was paid by the employer is not deductable from the total compensation determined by the Tribunal. Reference was made to the Co-ordinate Bench decision of this court in MFA No.16/2018 c/w MFA No.2222/2018 (D.D.26.7.2019) as well as the Co-ordinate Bench decision in the case of Smt. Jyothirmoi and others Vs. the Managing Director, BMTC Central Office and another in MFA Nos.4573/2015 c/w MFA
- 11 -
No.2730/2015 (D.D.11.12.2015) and Rajeshwari G. Bhuyar and others Vs. Sindhu Travels and another (2017 ACJ 87).
9. We have carefully considered the rival submissions made by the learned counsel for both the parties and perused the material on record.
10. Adverting to the said arguments, the points that arise for our consideration are:
1. Whether the compensation of Rs.10,27,860/- received from the claimants out of group accident policy of insurance procured by the employer of the deceased Venkata Ramanujulu requires to be deducted from the total compensation determined by the Tribunal?.
2. Whether the quantum of compensation of Rs.49,83,232/- awarded by the Tribunal is just and reasonable in the facts and circumstances of the case?
- 12 -
11. Re: Point No.1 - This issue of deduction of the amount received under the group insurance scheme procured by the employer is no more res integra in view of the Co-ordinate Bench decision of this court in the case of Rajeshwari G. Bhuyar supra and United Insurance Company Limited [MFA No.16/2018 C/w. MFA No.2222/2018] supra, whereby the judgment of the Hon'ble Apex Court in Mrs. Heien C. Rebello's case has been considered and analysed in extenso.
12. In Mrs. Heien C. Rebello's case, the observations made in paragraphs 33 to 36 regarding the pecuniary advantage received from the claimants whether to be deductable in the case of an accidental death or other form of death are relevant and quoted hereunder for ready reference.
"33. So far as the general principle of estimating damages under the common law is concerned, it is settled that the pecuniary loss can be ascertained only by balancing on one hand, the
- 13 -
loss to the claimant of the future pecuniary benefits that would have accrued to him but for the death with the 'pecuniary advantage which from whatever source comes to him by reason of the death. In other words, it is the balancing of loss and gain of the claimant occasioned by the death. But this has to change its colour to the extent a statute intends to do. Thus, this has to be interpreted in the light of the provisions of the Motor Vehicles Act , 1939. It is very clear, to which there could be no doubt that this Act delivers compensation to the claimant only on account of accidental injury or death, not on account of any other death. Thus, the pecuniary advantage accruing under this Act has to be deciphered, co-relating with the accidental death. The compensation payable under the Motor Vehicles Act is on account of the pecuniary loss to the claimant by accidental injury or death and not other forms of death. If there is natural death or death by suicide, serious illness, including even death by accident., through train, air flight not involving motor vehicle. would not be covered under the Motor Vehicles Act. Thus. the application of general principle under the common law of loss and gain for the computation of compensation under this Act must co-relate to this
- 14 -
type of injury or deaths, viz, accidental. If the words "pecuniary advantage' from whatever source are to be interpreted to mean any form of death under this Act it would dilute all possible benefits conferred on the claimant and would be contrary of the spirit of the law. If the 'pecuniary advantage' resulting from death means pecuniary advantage coming under all forms of death then it will include all the assets movable, immovable, shares, bank accounts, case and every amount receivable under any contract. In other words, all heritable assets including what is willed by the deceased etc. This would obliterate both, all possible conferment of economic security to the claimant by the deceased and the intentions of the legislature. By such an interpretation the tortfeasor in spite of his wrongful act or negligence, which contributes to the death, would have in many cases no liability or meagre liability. In our considered opinion, the general principle of loss and gain takes colour of this statute, viz., the gain has to be interpreted which is as a result of the accidental death and the loss on account of the accident death. Thus, under the present Act whatever pecuniary advantage is received by the claimant, from whatever source, would only mean which comes to the claimant on
- 15 -
account of the accidental death and not other form of death. The constitution of the Motor Accidents Claims Tribunal itself under Section 110 is, as the Section states;
"....for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, ....."
34. Thus, it would not include that which claimant receives on account other form of deaths, which he would have received even apart from accidental death. Thus, such. pecuniary advantage would have no correlation to the accidental death for which compensation is computed. Any amount received or receivable not only on account of the accidental death but that would have come to the claimant even otherwise, could not be construed to be the "pecuniary advantage", liable for deduction. However, where the employer insures his employee, as against injury or death arising out of an accident, any amount received out of such insurance on the happening of such incidence may be an amount liable for deduction. However, our legislature has taken not of such contingency, through the proviso of Section 95. Under it the liability of the
- 16 -
insurer is excluded in respect of injury or death, arising out of, in the course of employment of an employee.
35. This is based on the principle that the claimant for the happening of the same incidence may not gain twice from two sources. This, it is excluded thus, either through the wisdom of legislature or through the principle of loss and gain through deduction not to give gain to the claimant twice arising from the same transaction, viz., same accident. It is significant to record here in both the sources, viz., either under the Motor Vehicles Act or from the employer, the compensation receivable by the claimant is either statutory or through the security of the employer securing for his employee but in both cases he receives the amount without his contribution. How thus an amount earned out of one's labour or contribution towards one's wealth, savings, etc. either for himself or for his family, which such person knows, under the law, has to go to his heirs after his death either by succession or under a will could be said to be the 'pecuniary gain' only on account of one's accidental death. This, of course, is pecuniary gain but how this is equitable or could be balanced out of the amount to be received as compensation under the Motor
- 17 -
Vehicle Act. There is no co-relation between the two amounts. Not even remotely. How can an amount of loss and gain of one contract could be made applicable to the loss and gain of another contract. Similarly, how an amount receivable under a statute has any co-relation with an amount earned by an individual. Principle of loss and gain has to be on the same place within the same sphere, of course, subject to the contract to the contrary or any provisions of law.
36. Broadly, we may examine the receipt of the provident fund which is a deferred payment out of the contribution made by an employee during the tenure of his service. Such employee or his heirs are entitled to receive this amount irrespective of the accidental death. This amount is secured, is certain to be received, while the amount under the Motor Vehicles Act is uncertain and is receivable only on the happening of the event viz., accident which may not take place at all. Similarly., family pension is also earned by an employee for the benefit of his family in the form of his contribution in the service in terms of the service conditions receivable by the heirs after his death. The heirs receive family pension even otherwise than the accidental death. No co- relation between the two. Similarly, life insurance
- 18 -
policy is received either by the insured or the heirs of the insured on account of the contract with the insurer, for which insured contributes in the form of premium. It is receivable even by the insured, if he lives till maturity after paying all the premiums, in the case of death insurer indemnifies to pay the sum to the heirs, again in terms of the contracts for the premium paid. Again, this amount is receivable by the claimant not on account of any accidental death but otherwise on insured's death. Death is only a step or contingency in terms of the contract, to receive the amount. Similarly any case, bank balance, shares, fixed deposits, etc. though are all a pecuniary advantage receivable by the heirs on account of one's death but all these have no co-relation with the amount receivable under a statute occasioned only on account of accidental death. How could such an amount come within the periphery of the Motor Vehicles Act to be termed as 'pecuniary advantage' liable for deduction. When we seek the principle of loss and gain, it has to be on similar and same plane having nexus inter so between them and not to which, there is no semblance of any co-relation. The insured (deceased) contributes his own money for which he receives the amount has no
- 19 -
co-relation to the compensation computed as against tortfeasor for his negligence on account of accident. As aforesaid, the amount receivable as compensation under the Act is on account of the injury of death without making any contribution towards it then how can fruits of an amount received through contributions of the insured be deducted out of the amount receivable under the Motor Vehicles Act. The amount under this Act, he receives without any contribution. As we have said the compensation payable under the Motor Vehicles Act is statutory while the amount received under the life insurance policy is contractual."
13. In Rajeshwari G. Bhuyar case supra, in paragraph 9, referring to catena of judgments, it has been held thus:
"Therefore, it is amply clear that the fruits of an amount received through contributions/premium made by the insured or the employer of the deceased cannot be deducted out of the amount receivable under the Motor Vehicles Act."
- 20 -
14. In Jyothirmoy's case supra, the Division Bench while considering the compensation received from the claimants under group insurance from the BEML - the employer of the deceased therein, whether requires to be deducted while computing the compensation has categorically held that the payment of the said amount under group insurance scheme has nothing to do with the compensation to be paid by the tortfeasors. The said amount was paid by the employer of the deceased under contract of employment between the employee and the employer. These judgments have been referred to by the Co-ordinate Bench of this Court MFA No.16/2018 United India Insurance Company Limited case supra, and it has been held that the payment of compensation made to the claimants under the group insurance personal accident policy, is not deductable from the amount of compensation awarded by the Tribunal as the same is a means of succor to the parents or family of the deceased, the same cannot be
- 21 -
related to compensation sought under section 166 of the Act due to death arising out of the road traffic accident on account of tortious negligence on the part of the driver of the offending vehicle. In the light of these judgments, we are of the considered view that the arguments advanced by the learned counsel for the insurer on this point has to be negated. Much emphasis was placed by the learned counsel appearing for the insurer on the letter dated 13.6.2014 issued by Century Link Technologies India Private Limited, the document sought to be produced along with I.A.No.3/2016, the relevant portion of the same reads thus:
" 1. We have tie up with New India Insurance for our employee coverage and accordingly New India has settled Rs.10,27,860 as GPA compensation to Venkata Ramanujulu heirs Smt. Vidya Kedari.
2. As per our company Salary Structure, Insurance Premium payable to insurance
- 22 -
company towards GPA coverage is also part of the salary."
15. From the aforesaid, it is ex facie evident that the insurance premium paid to the insurance company by the employer towards the GPA scheme is nothing but part of the salary of the employee. The said amount was paid by the employer of the deceased under the contract of employment between the employee and the employer from the salary of the employee. The premium contributed by the insured (deceased) through the employer for which the claimants receive the compensation has no co-relation to the compensation computed as against tortfeasor for his negligence on account of accident. The amount receivable as compensation under the Act is on account of the injury or death without making any contribution towards it. As such, fruits of an amount received through contributions of the insured cannot be deducted out of the amount receivable under the Act. The compensation
- 23 -
payable under the Act being statutory, the amount received by the claimants under the Group Insurance Policy Scheme being contractual, the same is not liable to be deducted from the total compensation.
16. Re: Point No.2 : It is not in dispute that the deceased was working as a Senior Engineer at Century Link Technologies India Private Limited at the time of the accidental death. Ex.P16 - letter issued by the Century Link Technologies India Private Limited, Ex.P17-the pay slips for the months of June to November 2013 establishes that the deceased had a basic salary of Rs.16,748/-, HRA Rs.8,374/- and other allowances i.e. Medical Allowance, Special Allowance, Shift Allowance etc., Ex.P17- salary slip for the month of November 2013 evinces that the deceased was drawing a monthly salary of 38,553/-. There being no satisfactory material to establish the factum of stable/permanent job held by the deceased, we have no
- 24 -
hesitation to add 40% of the monthly salary of Rs.38,553/- to determine the monthly income of the deceased. By adding so, the monthly income would be Rs.38,553 + Rs.15,421 = Rs.53,974. The deceased was aged about 34 years at the time of the accident and the multiplier applicable would be 16. Considering the number of dependants, 1/3rd of the income requires to be deducted towards personal and living expenses of the deceased. The total loss of dependency would be Rs.53,974 x 12 x 16 x 2/3 = Rs.69,08,672/-. In terms of the dictum of the Hon'ble Apex Court in National Insurance Company Limited Vs. Pranay Sethi and others ((2017)16 SCC 680), the claimants would be entitled to compensation of Rs.40,000/- towards loss of consortium, Rs.15,000/- towards loss of estate and Rs.15,000/- towards transportation and funeral expenses. In terms of the recent judgment of the Hon'ble Apex Court in United India Insurance Co. Ltd., Vs. Satinder Kaur @ Satwinder Kaur & Others in Civil
- 25 -
Appeal No.2705/2020, the minor child is entitled to parental consortium of Rs.40,000/-.
17. For the reasons aforesaid, the total compensation awarded by the Tribunal is modified as under:
Sl.No. Particulars Amount [in Rs.]
1. Loss of dependency 69,08,672/-
Loss of spousal
2. 40,000/-
Consortium
3. Loss of Estate 15,000/-
Towards Funeral and
4. 15,000/-
transportation expenses Loss of parental
5. 40,000/-
consortium
Total 70,18,672/-
Thus, the claimants shall be entitled to total compensation of Rs.70,18,672/- with interest @ 6% p.a. from the date of the claim petition till the date of realization.
18. Hence, the following:
ORDER
1. MFA No.480/2016 filed by the claimants is allowed in part.
- 26 -
2. The total compensation awarded by the Tribunal is modified and enhanced to Rs.70,18,672/- as against Rs.49,83,232/- which shall carry interest @ 6% p.a. from the date of petition till its realization.
3. MFA No.876/2016 filed by the insurance company is dismissed.
4. The liability is fastened on the insurer to indemnify the liability of owner. The insurer shall deposit the re-assessed total compensation determined as aforesaid within 90 days from the date of receipt of the judgment and order.
5. The portion of the order of the Tribunal inasmuch as apportionment and disbursement remains intact.
- 27 -
6. Accordingly, the modified compensation shall be apportioned and disbursed in terms of the order of the Tribunal.
7. I.A.No.3/2016 filed by the Insurance Company stands disposed of.
8. Amount in deposit shall be transmitted to the jurisdictional Tribunal for disbursement.
9. Draw modified award accordingly.
Sd/-
JUDGE Sd/-
JUDGE Dvr: