Gujarat High Court
National vs Chhedilal on 11 February, 2010
Author: H.K.Rathod
Bench: H.K.Rathod
Gujarat High Court Case Information System
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FA/257/2010 19/ 19 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 257 of 2010
With
CIVIL
APPLICATION No. 1560 of 2010
In
FIRST APPEAL No. 257 of 2010
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NATIONAL
INSURANCE CO. LTD REG.OFFICE AT 3RD FLOOR - Appellant(s)
Versus
CHHEDILAL
RAMFAL VARMA & 7 - Defendant(s)
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Appearance
:
MR
SUNIL B PARIKH for
Appellant(s) : 1,
None for Defendant(s) : 1 -
8.
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CORAM
:
HONOURABLE
MR.JUSTICE H.K.RATHOD
Date
: 11/02/2010
ORAL
ORDER
Heard learned advocate Mr. Sunil B. Parikh appearing on behalf of appellant insurance company.
The appellant has challenged amount of Rs.1,50,000/- in present appeal. The appellant has challenged award passed by MACT, Nadiad in MACP No.193 of 2005 decided on 31st January 2009 Ex.48. The claims tribunal has awarded Rs.3,06,900/- with 9% interest in favour of claimant. The claimants have filed application under Sec.163A of MV Act.
The accident occurred on 14th March 2005. The deceased Kashiram Varma was proceeding from Umreth towards Dakor on scooter bearing registration No.GJ-7-Q-1647 of ownership of opponent No.1 as a pillion rider and the said scooter was being driven by opponent No.1 in slow speed on correct side of road. When they reached near the Sim of village Umreth Crossing No.27, at that time, opponent No.5 came in excessive speed with vehicle bearing Truck No.GJ-7-Z-9095, dashed with scooter. As a result, scooter dashed with truck bearing No.GJ-7-X-7821 coming from opposite direction. As a result, he sustained serious injuries and due to injuries, he died on the spot. Total claim was made for Rs.4,65,500/-. Opponent Nos.1, 3, 4, 6 and 7, though served, but not appeared and represented before claims tribunal. Learned advocate for insurance company was appeared and filed reply at Ex.23 and Ex.41 denying averments made in claim petition. The claims tribunal has considered the object of Section 163A of MV Act in paragraphs 5 and 6, which are quoted as under :
5. It is settled proposition of law that the application U/s.163-A of MV Act is substantive application and award passed on the basis of such application is final, Sub-section-2 of Section 163-A of the MV Act provides that in any claim for compensation under Sub-section-1, the claimants shall not be required to plead or establish that death or permanent disability in respect of which the claim has been made was due to any wrongful act or negligent or default of the driver of the vehicle.
6. It is also a settled proposition of law that once the motor vehicle involved in the accident is insured for the relevant period, the Insurance Company cannot be exonerated from the liability to pay compensation to the claimants merely on the ground of breach of any terms and conditions of the Insurance Policy by the insured. If at all, there is any breach of any terms and condition of the Insurance Policy by the insured, at the most, the Insurance Company may be entitled to recover the amount from the insured, but the Insurance Company is liable to pay compensation to the claimants (vide United India Insurance Company vs. Lehru 2003) SCC 338 = 2003 (2) GLH 256 (para 15 & 17), New India Assurance Co. Ltd. Vs. Kamla, AIR 2001 SC 1419 = 2001(4) SCC 3421 (para 22) and New India Assurance Co. Ltd.
Vs. Rula AIR 2000 SC 1082 = 2003(3) SCC 195 (para 12 & 13).
The claimant has produced certain documents as referred in paragraph 7 which are quoted as under :
7. In support of the claim petition, the claimants have place reliance on the following documents produced at list Exh.6, 24, 36 and 45 :
Copy of complaint mark 6/1 Copy of panchnama mark 6/2 Copy of inquest panchnama mark 6/3 Copy of R.C. Book of scooter bearing No.GJ-7-Q-1647 mark 6/4 Copy of insurance policy of scooter mark 6/5 Copy of R.C. Book of truck No.GJ-7-X-7821 mark 6/6 Copy of insurance policy of truck No.GJ-7-X-7821 mark 6/7 Copy of R.C. Book of truck No.GJ-7-Z-9095 mark 6/8 Copy of insurance policy of truck No.GJ-7-Z-9095 mark 6/9 Copy of post mortem note of deceased Kashiram mark 24/1 Copy of chargesheet mark 24/2 Salary certificate of deceased mark 24/3 36/1 Certified copy of judgment delivered in M.A.C.P. Case No.141/2005 mark 45/1 The age of deceased Kashiram as per affidavit Ex.25 was 29 years and as per postmortem note at mark 24/1, was aged about 30 years. The deceased was doing work of Plaster of Paris and monthly getting Rs.3,000/-. In support of that one Ram Ujagar Varma has stated on affidavit Ex.37 that he is residing at Vidhyanagar and doing work of Plaster of Paris, etc., with the help of labourer. According to his evidence Ex.37, deceased was doing work of Plaster of Paris and he was getting Rs.100/- daily wage and one certificate also produced on record at Mark 4/3. Therefore, claims tribunal has assessed income Rs.2,100/- monthly and 1/3rd has been deducted as per second schedule and 18 multiplier has been applied, accordingly, it comes to Rs.3,02,400/- being a family dependency loss, then, Rs.2,500/- being a loss of estate and Rs.2,000/- being a funeral charges awarded.
Learned advocate Mr. Parikh relied upon two decisions of Apex Court and pointed out that deceased was unmarried, therefore, age of claimant is to be considered and proper multiplier is 8 and Rs.1,400/- dependency is on higher side. He relied upon decision of Division Bench of this Court reported in 23(1) GLR 785 and 26(2) GLR 1315. He also relied upon decision of Apex Court reported in 1999 ACJ 1400. In such cases, dependency comes to 1/3rd not 2/3rd as decided by Apex Court. Therefore, according to his submission that because deceased was unmarried, 1/3rd dependency is available to claimant, 18 multiplier is on higher side, because, age of deceased is not to be considered while applying multiplier, but, age of claimant is to be considered. He relied upon recent decision of Apex Court in case of Reshmakumari v. Madanmohan reported in 2009 AIR SCW 6909 and National Insurance Co. Ltd. v. Gurumallama reported in 2009 AIR SCW 7434. He submitted that in case of Reshmakumari, Apex Court has referred the matter to larger Bench while deciding 166 application, whether second schedule is made applicable or not. The identical question has been examined by this Court in First Appeal No.101 of 2010 on 29th January 2010 in case of ICICI Lombard General Insurance Com. Ltd. v. Kanji Bachubhai Ayar and others, where similar question has been decided elaborately discussed the similar question raised before this Court by learned advocate Mr. Vibhuti Nanavati who was appearing on behalf of insurance company, who relied upon both decisions which have been relied upon by learned advocate Mr. Parikh. The relevant discussion is made in aforesaid First Appeal in paragraphs 4 to 8, which are quoted as under :
4.0 Relying upon aforesaid two decisions, learned Advocate Mr. Nanavati raised contention that the Claims Tribunal has considered Rs.3,000/- as monthly income of the deceased, which yearly comes to Rs.36,000/- and considering age of the deceased 19 years, multiplier of 16 has been applied. Accordingly, the Claims Tribunal has committed gross error in relying upon annual income of Rs.36,000/- and considered Rs.6,84,000/- being amount of compensation and after deduction of 1/3rd amount, which comes to Rs.4,60,500/-, as awarded by the Claims Tribunal. The total amount of compensation available as per Second Schedule to the claimant when yearly income of the deceased comes to Rs.36,000/- then it comes to Rs.6,84,000/- after deducting 1/3rd amount Rs.2,28,000/- remaining amount comes to Rs.4,56,000/- and Rs.2,000/- has been awarded towards Funeral Expenses and Rs.2,500/- has been awarded towards Loss of Estate. The total amount comes to Rs.4,60,500/-. But, learned Advocate Mr. Nanavati submitted that such calculation is not correct and Second Schedule has been found by the Honourable Apex Court erroneous. Therefore, according to his calculation from Rs.3,000/-
monthly income if 1/3rd is deducted then it comes to Rs.2,000/- and yearly income comes to Rs.24,000/- and then applying a multiplier of 16 at an age of 19 years, it comes to Rs.3,84,000/- towards Loss of Dependency and thereafter, Rs.2,500/- towards Loss of Estate and Rs.2,000/- towards Funeral Expenses, in all comes to Rs.3,88,500/- and not Rs.4,60,500/-. Therefore, there is an excess of Rs.72,000/- awarded by the Claims Tribunal, which found apparently a calculation error while considering Second Schedule r/w. Section 163A of the Act. Except this, no other submission has been made by learned Advocate Mr. Nanavati.
5.0 I have considered submissions made by learned Advocate Mr. Nanavati and I have also considered both decisions of the Honourable Apex Court as relied by the learned Advocate Mr. Nanavati as referred above. In the case of Gurumallamma, the Honourable Apex Court has clearly observed that, "Multiplier stricto sensu is not applicable in the case of fatal accident. The multiplier would be applicable only in case of disability in non-fatal accidents as would appear from the Note 5 appended to the Second Schedule. Thus, even if the application of multiplier is ignored in the present case and the income of the deceased is taken to be Rs.3,300/- per month, the amount of compensation payable would be somewhat between 6,84,000/- to Rs.7,60,000/-. As the Second Schedule provides for a structured formula, the question of determination of payment of compensation by application of judicial mind which is otherwise necessary for a proceeding arising out of a claim petition filed under Section 166 would not arise. The Tribunals in a proceeding under Section 163A of the Act is required to determine the amount of compensation as specified in the Second Schedule. It is not required to apply the multiplier except in a case of injuries and disabilities." Similarly, in the case of Reshma Kumari (supra) in Para 38, the Honourable Apex Court has observed that, Second Schedule refers to Sec. 163A of the 1988 Act, which as noticed hereinbefore, provides for quantum of compensation to third party in case of fatal accidents or injuries suffered. It provides for a table. It specifies the amount requires to be paid to legal heirs / representatives of the deceased in the case of fatal accident and the claims in the case of injuries suffered by them depending upon his age and annual income as specified therein .
5.1 Thereafter, in Para 40 of the said decision, the Honourable Apex Court has observed that, It, however, appears to us that there is no mistake therein. Amount of compensation specified in the Second Schedule only is required to be paid even if a higher or lower amount can be said to be the quantum of compensation upon applying the multiplier system . In the same decision, in Para 41, the Honourable Apex Court has observed that, The multiplier, in terms of the Second Schedule, is required to be applied in a case of disability in non-fatal accident. Consideration for payment of compensation in the case of death in a 'no fault liability' case vis-?-vis the amount of compensation payable in a case of permanent total disability and permanent partial disability in terms of Second Schedule is to be applied by different norms. Whereas, in the case of fatal accident the amount specified in the Second Schedule depending upon the age and income of the deceased is required to be paid wherefor the multiplier is not to be applied at all but in a case involving permanent total disability or permanent partial disability the amount of compensation payable is required to be arrived at by multiplying the annual loss of income by the multiplier applicable to the age of the injured as on the date of determining the compensation and in case of permanent partial disablement such percentage of compensation, which would have been payable in the case of permanent total disablement as specified under item (a) of the Second Schedule .
6.0 In view of the above observations made in both the cases by the same Division Bench of the Honourable Apex Court deciding the question on 23rd July 2009, it is made clear that in case of fatal accident, multiplier system is not to be applied but only annual income of deceased r/w. compensation in case of death between a particular age, the figure, which has been given against that column is only to be taken into account. Therefore, in this case, considering Rs.36,000/- as annual income and age of deceased as 19 years, a multiplier of 16 is not to be applied but only to consider the amount of compensation in case of death, which has been mention below annual income of Rs.36,000/-, which comes to Rs.6,84,000/-, which has been rightly arrived at by the Claims Tribunal, after proper reading and understanding the Second Schedule and thereafter, it requires to be deducted 1/3rd amount in consideration of the expenses, which the victim would have incurred towards maintaining himself had he been alive. Therefore, according to my opinion, Claims Tribunal has rightly adopted the method by not applying the multiplier but considering the annual income of the deceased and compensation in case of death, which comes to, considering the age of 19 years, Rs.6,84,000/- has been properly assessed and thereafter, rightly deducted 1/3rd amount for doing so, the Claims Tribunal has not committed any error which requires interference by this Court.
7.0 In view of both the above decisions of the Honourable Apex Court, according to my opinion, the Honourable Apex Court has made it clear in both the cases that multiplier method is to be applied in case of injury means non-fatal accident but in case of fatal accident, multiplier method of Second Schedule is not applicable but Claims Tribunal has to consider only annual income of the deceased and the age of deceased and amount of compensation in case of death given in Second Schedule is to be considered.
8.0 Therefore, submissions made by learned Advocate Mr. Nanavati in Ground D of the Appeal Memo that after deducting 1/3rd amount from the monthly income of Rs.3,000/-, a multiplier of 16 has been applied, which cannot be made applicable in case of death. Therefore, the contention raised by learned Advocate Mr. Nanavati in respect of applicability of Second Schedule in case of death is confusing himself and also creating confusion before this Court and without going into entire decisions in both the cases cannot be accepted as in both decisions it has been made clear that multiplier method of Second Schedule r/w. Sec. 163A is applicable only in case of injury only and it is irrelevant and not applicable such multiplier method in case of death and in such circumstances, in case of death Claims Tribunal has to consider the annual income of deceased, age of deceased and compensation workout in the Second Schedule in case of death is to be considered and thereafter to deduct 1/3rd amount, whatever amount come that is the amount of compensation available to the claimant. That method has been rightly applied by the Claims Tribunal and accordingly, compensation has been rightly worked out, for that, according to my opinion, the Claims Tribunal has not committed any error, which requires any interference by this Court.
8.1 The contention raised by learned Advocate Mr. Nanavati before this Court that the Claims Tribunal has committed error in calculation of compensation. He relied upon multiplier of 16. Considering age of deceased, it comes within 15 to 20 years. He relied upon decision of the Honourable Apex Court in the case of Reshma Kumari (supra) that said question has been referred to the Larger Bench, which is not correct. The question, which has been referred by the Honourable Apex Court is that, when claimant files application under Sec. 166 to be decided on 'fault liability', in such case, claimant may not get same amount of compensation which available to claimant if application is filed under Sec. 163A of the Motor Vehicles Act. Therefore, a large question, which has been posed by the Honourable Apex Court in Paras 43 and 44 of the said judgment, are quoted as under, which give clear picture that which question has been referred to the Larger Bench.
43. Thus, prima facie, it appears that the multiplier mentioned in the Second Schedule, although in a given case, may be taken to be a guide but the same is not decisive. To our mind, although a probable amount of compensation as specified in the Second Schedule in the event the age of victim is 17 or 20 years and his annual income is Rs.40,000/-, his heirs/ legal representatives is to receive a sum of Rs.7,60,000/-, however, if an application for grant of compensation is filed in terms of Section 166 of the 1988 Act that much amount may not be paid, although in the former case the amount of compensation is to be determined on the basis of `no fault liability and in the later on `fault liability In the aforementioned situation the Courts, we opine, are required to lay down certain principles.
44. We are not unmindful of the Statement of Objects and Reasons to Act 54 of 1994 for introducing Section 163-A so as to provide for a new predetermined formula for payment of compensation to road accident victims on the basis of age/income, which is more liberal and rational. That may be so, but it defies logic as to why in a similar situation, the injured claimant or his heirs/legal representatives, in the case of death, on proof of negligence on the part of the driver of a motor vehicle would get a lesser amount than the one specified in the Second Schedule. The Courts, in our opinion, should also bear that factor in mind.
8.2 According to the Honourable Apex Court, Sec. 163A r/w. Second Schedule, which is more liberal and rational than why in a similar situation, the injured claimant or his legal heirs/representatives in the case of death on proof of negligence on the part of the driver of a motor vehicle would get a lesser amount than one specified in the Second Schedule. The Court, in our opinion, should also bear that factor in mind. So, this question referred to the Larger Bench by the Honourable Apex Court. But question which has been raised before this Court is not referred to the Larger Bench by the Honourable Apex Court. Therefore, contention raised by learned Advocate Mr. Nanavati cannot be accepted because in the facts of the present case, application filed by claimant under Sec. 163A of the Act and considering age of deceased 19 years and annual income Rs.36,000/-, the total amount of compensation comes to Rs.6,84,000/- then to deduct 1/3rd amount then amount comes to Rs.4,56,000/-. In such circumstances, the calculation suggested by learned Advocate Mr. Nanavati that instead of that annual income of deceased is to be considered Rs.24,000/- and to apply 16 multipliers. That contention of Mr. Nanavati is totally contrary to Sec. 163A r/w. Second Schedule, because Second Schedule having a particular condition in Item No. 5, which is quoted as under:
"5. Disability in non-fatal accidents:
The following compensation shall be payable in case of disability to the victim arising out of non-fatal accidents:
Loss of income, if any, for actual period of disablement not exceeding fifty two weeks.
PLUS either of the following:-
(a) In case of permanent total disablement the amount payable shall be arrived at by multiplying the annual loss of income by the Multiplier applicable to the age on the date of determining the compensation, or
(b) In case of permanent partial disablement such percentage of compensation which would have been payable in the case of permanent total disablement as specified under item (a) above.
Injuries deemed to result in Permanent Total Disablement/Permanent Partial Disablement and percentage of loss of earning capacity shall be as per Schedule I under Workmen's Compensation Act, 1923."
8.3 So, multiplier is applicable to in case of disability in non-fatal accident only and multiplier is not applicable in case of fatal accident. Not only that but looking to annual income of deceased, in case of fatal accident against respective age of deceased whatever compensation available to claimant in case of death considering annual income that amount of compensation is to be worked out first and then to deduct 1/3rd from that amount and thereafter, whatever amount comes it considered to be a dependency of claimant. In Sec. 163A question of considering future prospective amount does not arise. Not only that in case of deceased being an unmarried, age of parents or claimant is not necessary to consider but strictly to calculate the compensation or to workout it, consider Second Schedule itself. Therefore, calculation suggested by learned Advocate Mr. Nanavati in Ground 'D' of Appeal Memo cannot be accepted because such theory is not acceptable in light of Second Schedule as well as both decisions of Honourable Apex Court as referred above also held it that in case of fatal accident question of multiplier is not applicable but it applies only in case of disability in non-fatal accident and in case of death, compensation is to be worked out on annual income of deceased considering amount of compensation given against column of age is to be worked out and thereafter, to deduct 1/3rd amount of expenses. This is the correct and legal formula recognized by statutory provisions. Therefore, confusion created by learned Advocate Mr. Nanavati cannot be accepted. Though, law and Sec. 163A r/w. Second Schedule are very clear, there is no ambiguity at all so which require to refer such question to the Larger Bench by the Honourable Apex Court. In fact, this question is not referred by Honourable Apex Court in case of Reshma Kumari.
In light of aforesaid observations made by this Court, contentions raised by learned advocate Mr. Parikh cannot be accepted, hence, rejected, as while deciding 163A application, claims tribunal has to consider entire matter for calculating or working out compensation strictly on the basis of annual income of deceased and compensation which has been worked out as per second schedule considering age of deceased, thereafter, whatever compensation is worked out as per second schedule, then, 1/3rd amount is to be deducted being a personal expenses of deceased and whatever amount comes to is considered to be a dependency of claimant. The multiplier method is not applicable in case of death while deciding 163A application filed by claimant.
The amount of compensation which has been worked out by claims tribunal is found to be just, proper and reasonable which cannot consider to be on higher side and claims tribunal has not committed any error which requires interference by this Court.
Therefore, there is no substance in present first appeal. Accordingly, present first appeal is dismissed.
When first appeal is dismissed by this Court today, no order is required to be passed in civil application. Hence, civil application is disposed of.
The amount, if any, deposited by appellant before registry of this Court, be transmitted to claims tribunal concerned, immediately.
Sd/-
[H.K. RATHOD, J.] #Dave Top