Telangana High Court
M/S United India Insurance Co Ltd., ... vs Bandela Sadana, Nizamabad Dist 4 Others on 27 April, 2022
Author: G. Sri Devi
Bench: G. Sri Devi
THE HON'BLE JUSTICE G. SRI DEVI
M.A.C.M.A. Nos. 1760 of 2014 & 1843 of 2014
COMMON JUDGMENT:
MACMA.No. 1760 of 2014 is preferred by the appellant-United India Insurance Company Limited, who is the respondent No. 2 before the Tribunal, assailing the order and decree of the Motor Accidents Claims Tribunal-cum-District Judge at Nizamabad made in M.V.O.P. No. 823 of 2006 dated 10.10.2013 on the ground that inasmuch as the driver of the offending vehicle had no valid driving licence to drive the offending vehicle as on the date of accident and since the owner of the offending vehicle i.e., respondent No.5 herein had violated the conditions of Ex.B.1 by entrusting the vehicle to an incompetent person, the learned Tribunal ought not to have fastened liability upon the insurance company, and the liability ought to have been fixed on the respondent No. 5 alone.
2. MACMA No. 1843 of 2014 is preferred by the appellants, who are the claimants before the Tribunal, assailing the very same order and decree of the Tribunal on the ground of inadequacy of compensation; that the monthly income taken by the Tribunal is not based on proper appreciation of evidence; that the amount granted under conventional heads is too meagre.
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3. The claimants instituted the M.V.O.P. under Section 166 of the Motor Vehicles Act, which was amended subsequently under Section 163A of the Motor Vehicles Act, alleging that on 21.09.2005, while the deceased, Bandela Gangadhar, was proceeding on the scooter belonged to the respondent No. 1 in the O.P., from Navipet, when he reached Tadgaon village T Road, he lost control over the scooter, fell down from the scooter and received multiple injuries. Initially he was admitted in Government Hospital, Nizamabad and he died on 22.09.2005 at about 6.30 a.m. while being shifted to Hyderabad. According to the claimants, the deceased was aged 35 years and earning Rs.10,000/- per month as toddy tapper. Therefore, they laid a claim for Rs.6.00 lakhs towards compensation under different heads. Considering the claim and the counter filed by the Insurance Company and on evaluation of the evidence, both oral and documentary, the learned Tribunal has allowed the O.P. in part and awarded total compensation of Rs.5,00,000/- with 7% interest per annum, holding the owner of the offending vehicle and the insurance company jointly and severally liable to pay the compensation.
4. Heard both sides.
5. The learned counsel for the appellants-claimants in MACMA No. 1843 of 2014 contends that instead of restricting the compensation to Rs.5,00,000/-, the learned Tribunal ought to have awarded entire compensation of Rs.6.00 lakhs, as the deceased was 3 aged about 35 years and was earning Rs.10,000/- per month as toddy tapper. In addition to that, the learned Tribunal ought to have added 25% to the income of the deceased towards future prospects.
6. On the other hand, the learned Sanding Counsel for the Insurance Company, with regard to the quantum of compensation, has contended that the Tribunal has adequately granted the compensation and the same needs no interference by this Court. His only contention, as pleaded in his appeal i.e., M.A.C.M.A. No. 1760 of 2014, is that the driver of the offending vehicle was not holding valid driving license by the date of the accident and therefore, the owner of the vehicle i.e., respondent No. 1 in the O.P., had violated the terms of Ex.B.1-policy by negligently entrusting his scooter to an incompetent person. Inasmuch as R.W.1 specifically deposed that the driver of the offending vehicle was not possessing valid driving licence to drive the offending scooter, the learned Tribunal ought not to have discredited the said evidence and ought not to have fastened any liability upon the Insurance Company to pay the compensation and it is the respondent No. 1 in the O.P. who alone is liable to pay the compensation to the claimants as the deceased was working under him. Therefore, he seeks to set aside the order of the Tribunal to the extent of holding the Insurance Company jointly and severally liable to pay the compensation amount. 4
7. As regard the quantum of compensation, the claimants claimed that at the time of fatal accident, the deceased was aged about 35 years and was earning a sum of Rs.10,000/- per month as toddy tapper. In the case on hand, the claim petition was filed under Section 163A of the MV Act. Therefore, while determining the compensation only the structural formula provided under Section 163-A and Second Schedule of the M.V. Act has to be considered. Therefore, the Tribunal has rightly fixed the gross annual income of the deceased at Rs.40,000/- and after deducting 1/4th therefrom towards personal expenses of the deceased and applying the multiplier '16' considering the age of the deceased as 35, rightly fixed the loss of dependency at Rs.4,80,000/-. Further, the ratio of laid down by the Apex Court in National Insurance Company Limited Vs. Pranay Sethi and others1 is not applicable in the claim petition filed under Section 163-A of the M.V.Act. Therefore, no compensation can be added towards loss of future prospects. So also, under conventional head, compensation of Rs.77,000/- cannot be awarded, as contended by the learned Counsel for the claimants. Therefore, the amount granted by the Tribunal towards general damages i.e. Rs.10,000/- towards consortium to the wife, Rs.5,000/- towards funeral expenses and Rs.5,000/- towards loss of estate is 1 2017 ACJ 2700 5 also not disturbed. However, as regards the rate of interest awarded by the Tribunal is concerned, the claimants are entitled to interest @ 7.5% per annum on the compensation awarded by the Tribunal, as per the decision of the Apex Court in Rajesh and others v. Rajbir Singh and others2. Hence, the interest granted by the Tribunal @ 7% per annum is enhanced to 7.5% per annum on the compensation amount of Rs.5,00,000/- from the date of petition till the date of realization
8. Coming to the appeal of the Insurance Company i.e., M.A.C.M.A. No. 1760 of 2014, as seen from the record, though it is the specific contention of the Insurance Company that the deceased was not holding any licence, neither the claimants nor the owner of the offending scooter, who was examined as R.W.2 chose to file the copy of driving licence, if any, pertaining to the deceased. Such being the case, it can safely be concluded that the deceased was not holding valid driving licence at the time of the accident. Handing over the offending scooter by its owner, respondent No. 1 in the O.P., to a person incompetent to drive the vehicle amounted to breach of terms and conditions of the policy. Therefore, there is a breach of terms and conditions of the Insurance Policy by the owner of the offending scooter. Hence, the finding of the learned Tribunal in 2 2013 ACJ 1403 = 2013 (4) ALT 35 6 fixing the liability jointly and severally upon the insurance company is not sustainable under law and liable to be set aside. But the fact remains that by the time of accident, the offending vehicle was insured with the appellant-Insurance Company and Ex.B.1 policy was very much in force. In case of third party risks, as per the decision in National Insurance Company Ltd. V. Swaran Singh and others3, the insurer has to indemnify the compensation amount payable to the third party and the insurance company may recover the same from the insured. In the said decision, the Apex Court considered the doctrine of "pay and recover" examined the liability of the insurance company in cases of breach of policy condition due to disqualifications of the driver or invalid driving license of the driver and held that in case of third party risks, the insurer has to indemnify the compensation amount to the third party and the insurance company may recover the same from the insured. Recently the Apex Court in Shamanna v. The Divisional Manager, the Oriental Insurance Company Limited and Others4, following its earlier decision in Swaran Singh (2 supra), reiterated that "even if the driver does not possess any driving license, still the insurer is liable to pay the compensation and that he can recover the award amount from the owner of the offending vehicle after paying the 3 (2004) 3 SCC 297 4 2018 ACJ 2163 7 amount." In view of the above, the Insurance Company is directed to pay the compensation amount at the first instance and then recover the same from the owner of the vehicle.
9. In the result, MACMA No. 1760 of 2014 filed by the Insurance Company is allowed in part setting aside the finding of the learned Tribunal to the extent of fixing the liability jointly and severally upon the insurance company. However, following the doctrine 'pay and recover', the Insurance Company is directed to pay the compensation amount awarded by the Tribunal together with accrued interest thereon to the claimants, at the first instance and thereafter recover the same from the owner of the offending vehicle i.e., the respondent No. 1 in the O.P. without initiating any separate proceedings. Whereas, M.A.C.M.A. No. 1843 of 2014 filed by the claimants is allowed in part enhancing the rate of interest from 7% to 7.5% on the compensation amount awarded by the Tribunal from the date of filing of the O.P. till the date of realization while maintaining the quantum of compensation awarded by the Tribunal. The amount shall be deposited within a period of one month from the date of receipt of a copy of this order, after giving due credit to the amount, if any, already deposited. On such deposit of compensation amount by the Insurance Company, the claimants are at liberty to withdraw the same. There shall be no order as to costs.
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As a sequel, the miscellaneous applications, if any pending, shall stand closed.
_____________________ JUSTICE G. SRI DEVI April 27, 2022 tsr 9 THE HON'BLE JUSTICE G. SRI DEVI M.A.C.M.A. Nos. 1760 of 2014 & 1843 of 2014 DATE: 27-04-2022