Madras High Court
M/S. United India Insurance Co. Ltd vs Mrs.Lakshmi @ Jayalakshmi on 13 February, 2012
Bench: R.Banumathi, S.Vimala
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 13.02.2012
CORAM:
THE HONOURABLE MRS.JUSTICE R.BANUMATHI
and
THE HONOURABLE MRS.JUSTICE S.VIMALA
C.M.A.No.2252 of 2011
M/s. United India Insurance Co. Ltd
Rep. by its Divisional Manager
G.P.M. Street, Gudiyatham .. Appellant
..Vs..
1.Mrs.Lakshmi @ Jayalakshmi
2.Gayathri (Minor)
3.Balaji (Minor)
4.Mr.R.V.Babu
(4th respondent ex parte in Tribunal
and hence notice may be dispensed with and
Respondents 2 and 3 are declared as major
and mother/1st respondent discharged from
the guardianship vide order of the Court
dated 15.12.2011 made in M.P.No.2 of 2011
in C.M.A.No.2252 of 2011) .. Respondents
Prayer: Civil Miscellaneous Appeal filed under Section 173 of the Motor Vehicles Act, 1988 against the fair and decretal order made in M.C.O.P.No.44/2006, dated 28.10.2010, on the file of the Motor Accidents Claims Tribunal (Subordinate Court), Gudiyatham, Vellore District.
For Appellant : Mr.M.B.Gopalan
For Respondents : Mr.S.Kamadevan
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J U D G M E N T
S.VIMALA, J., This appeal has been filed by the Insurance Company challenging the quantum of compensation allowed at Rs.19,58,714/- as against the claim of Rs.90,00,000/- awarded to the dependants/ legal representatives of the deceased T.N.Soundararajan.
2. The deceased was aged 53, earning Rs.75,000/- per month employed as LIC agent cum General Insurance agent of Oriental Insurance. On 07.10.2005, when he was travelling as a pillion rider in the two-wheeler bearing registration no.TN-02-T-0177 KGF, the driver drove it in a rash and negligent manner and caused the accident, in which the deceased died. The first claimant as the wife, second claimant as the daughter and the third petitioner as minor son of the deceased, T.N.Soundarajan estimated the loss and damage at Rs.90,00,000/- and filed the claim petition.
3. The claim was resisted by the Insurance Company on the grounds that a. there was no such accident, as alleged by the petitioner;
b. the deceased as the pillion rider is not entitled to any compensation;
c. the claim made is disproportionate; and d. the occupation/income, the dependency of the deceased are not admitted.
3.1. Before the Tribunal, P.Ws.1 to 3 had been examined, and Ex.P.1 to Ex.P.9 have been marked. On the side of the respondent, R.W.1 has been examined, and Ex.R.1 has been marked.
4. The Tribunal has framed and considered the following points for determination:-
1. Whether the accident was happened due to rash and negligent driving of the two wheeler rider bearing Regn.No.TN-02-T-01777.
2. Whether the petitioners are entitled to receive compensation?
3. To what relief?
On the consideration of oral and documentary evidence, the Tribunal has given a finding that the driver of the two wheeler alone (4th respondent herein) was responsible for the accident and that the claimants are entitled to compensation of Rs.19,58,714/-.
5. The Insurance Company has filed the appeal mainly challenging the quantum of compensation. The liability of the Insurance Company with regard to the pillion rider i.e. the deceased is not raised as an issue in this appeal.
6. On the question of negligence, the Tribunal has relied upon the evidence of P.W.2, the eye-witness, Ex.P.1-FIR, and has giving a finding that the accident took place due to the rash and negligent driving of the driver of the fourth respondent herein. The Tribunal has also pointed out that the factum of accident is not denied in the evidence of RW1. The finding of the Tribunal on the issue regarding negligence is not under challenge.
7. With regard to quantum of compensation, the Tribunal has fixed the age of the deceased as 56. Assessing the annual income at Rs.3,57,884/-, deducting 1/3rd towards personal expenses and adopting the multiplier of 8 the compensation has been quantified towards the loss of dependency at Rs.19,08,714/-. Adding Rs.10,000/- towards funeral expenses, Rs.20,000/- for loss of consortium for the first claimant, Rs.20,000/- for loss of love and affection to the petitioners 2 and 3, the total amount of compensation has been quantified at Rs.19,58,714/-.
7.1. The learned counsel for appellant contended that the Tribunal is not correct in fixing the annual income of the deceased at Rs.3,57,884/-, while as per Ex.R.1 the annual income of the deceased for the year 2005-2006 has been stated only as Rs.2,77,045.92. It is further contended that under Section 44 of the Insurance Act, the commission which would be payable to the agent would be continued to be paid to the legal representatives also and therefore, there is no loss of commission income to the claimants and hence the Tribunal is incorrect in fixing the huge amount towards loss of dependency. Both the contentions are not totally correct but, partly correct. The perusal of the evidence of PW3, who is the Assistant of LIC go to show that the commission is payable at various levels and various stages. There seems to be commission for new policies and normally it is called first year premium commission. Renewal commission is paid whenever first year policy premium is paid for the second year. Bonus commission is paid on first year premium commission. Renewal commission is paid only to a limited extent to the limited level. Therefore, it is evident that renewal commission alone would go to the legal representatives and only if there are new policies substantial benefits would enure to the benefit of the agent. Therefore, it is clear that the legal representatives would not get the full benefit out of the policy collections. Therefore, the contention that the legal representatives are put under no loss cannot be accepted.
7.2. The Tribunal has taken the average income for all the four years 2005-2006, 2004-2005, 2003-2004 and 2002-2003 and has finally taken the annual income at Rs.3,57,884/-. As contended by the learned counsel for the appellant as the accident had taken place in the year 2006 an average income which would be nearer to the income received during the year 2005-2006 would be appropriate.
7.3. On the other hand, the learned counsel for the claimant contended that the Tribunal has not awarded credit for the extraordinary effort taken by deceased in improving his business and the credit given by the Life Insurance Corporation of India giving special recognition to the deceased. This contention is correct and the evidence of PW3 go to show that the LIC used to give the post of President to the persons who are securing highest number of policies. Accordingly, the deceased had been the President of Agents Association and he had been the outstanding agent also. Thus, the deceased had out-performed the performance of the other agents. Taking into consideration the submissions on both sides, it would be appropriate to fix the annual income at Rs.3,15,000/-. Deducting a sum of Rs.1,05,000/- i.e. 1/3 of the total earning towards personal expenses, the annual dependency would be Rs.2,10,000/-. Adopting the multiplier of 8 the total loss of dependency would be Rs.16,80,000/-. The conventional damages awarded under the other head i.e. funeral expenses at Rs.10,000/- is maintained. Loss of consortium is enhanced from Rs.20,000/- to Rs.30,000/-. Likewise compensation for damages in the other head i.e. loss of love and affection is enhanced from Rs.20,000/- to Rs.40,000/- (Rs.20,000/- each). The total compensation awarded is reduced from Rs.19,58,714/- to Rs.17,60,000/- as shown below:-
Sl.No. Heads Amount awarded 1 Loss of dependency 1680000 2 Funeral expenses 10000 3 Loss of Consortium 30000 4 Loss of love and affection (Rs.20,000/- each) 40000 Total 1760000 The reduced compensation shall be apportioned amongst the claimants in the same ratio as ordered by the Tribunal.
8. In the result, this Civil Miscellaneous Appeal is partly allowed.
(i) The award of the Tribunal is reduced from Rs.19,58,714/- to Rs.17,60,000/-.
(ii) The interest payable on the entire award amount is at the rate of 7.5% per annum from the date of petition till the date of deposit.
(iii) As the Insurance Company is said to have deposited a sum of Rs.15,00,000/-, the balance shall be deposited within a period of eight weeks from the date of receipt of a copy of this Judgment with interest at the rate of 7.5% per annum.
(iv) On such deposit, the first claimant is permitted to withdraw her share of the amount with accrued interest, less the amount already withdrawn, if any. Claimants 2 and 3, who were then minors are also permitted to withdraw their apportioned share of compensation amount along with accrued interest, as they are already declared as major.
(v) In the circumstances of the case, there will be no order as to costs.
smn To
1. The Motor Accidents Claims Tribunal, (Subordinate Court), Gudiyatham, Vellore District.
2. The Section Officer, V.R. Section, High Court, Madras