National Insurance Company Ltd vs Kamlesh And Others on 15 March, 2010

[Cites 7, Cited by 3]

Punjab-Haryana High Court

National Insurance Company Ltd vs Kamlesh And Others on 15 March, 2010

1. This order will dispose of the appeal filed by the Insurance Company and the cross objections filed by the claimants challenging the award dated 30.11.2004, passed by the Motor Accidents Claims Tribunal, Panipat (for short, `the Tribunal'). The award has been challenged by the Insurance Company on merits, as it was submitted by learned counsel for the Company that the application filed by it under Section 170 of the Motor Vehicles Act, 1988 (for short, `the Act') was allowed by the Tribunal.

2. Briefly, the facts, as are evident from the impugned award, are that on 23.11.2003, Rishi Dev was taking his real brother-Naresh Kumar from his village to Israna for medical treatment in car No. DL-2CM-3753. Rishi Dev was driving the car at moderate speed. When they reached near village Bandh turn in the area of village Mandi on the pucca road, car No. HR26-S-9036, being driven by Ramesh Kumar in rash and negligent manner, came from village Mandi side and collided with the car being driven by Rishi Dev, as a result of which their car struck against a kikkar tree and over turned in the right side of the road in kacha FAO No. 1732 of 2005 [2] side. Due to the accident, Rishi Devi succumbed to the injuries and Naresh Kumar received injuries. The claimants filed claim petition before the Tribunal on account of the death of Rishi Dev. The learned Tribunal, after considering the evidence led by the parties, held that the accident occurred on account of negligence on the part of driver of car No. HR26-S-9036 and considering the age, income and dependency of the deceased, awarded a compensation of Rs. 26,50,000/- along with interest @ 6% per annum from the date of filing of the petition till its payment.

3. The Insurance Company has impugned the award on the plea that no accident had taken place with the car in question and even if it is considered that the accident had taken place, the driver of the offending vehicle was not negligent. The second ground of challenge is on the quantum of compensation.

4. On the other hand, in the cross objections filed by the claimants, the prayer is for enhancement of compensation already awarded.

5. Learned counsel for the Insurance Company referring to the evidence led by the claimants and pointing out discrepancies therein submitted that the only conclusion which can be arrived at after going through the evidence is that car bearing No. HR26-S-9036 was not involved in the accident and the same was subsequently implicated just to get the amount of compensation. Initially in the FIR got registered on the statement of Naresh Kumar, brother of the deceased, who was accompanying him in the car, the registration number of other vehicle which was involved in the accident, was given as HR-08H-0007. It was subsequently in his supplementary statement that he had mentioned car No. HR26-S-9036. None of the witnesses produced by the claimants had seen the accident. In fact, as is evident from a perusal of their statements, they were merely planted witnesses. There is no finding recorded by the Tribunal as to how the accident had occurred. There is nothing on record to suggest as to how the driver of the offending vehicle was negligent even if it is considered that the accident in question had taken place. The speed at which the vehicles were being driven has not come on record. In fact, the car being driven by the deceased, in which PW5-Naresh Kumar was sitting, was being driven at a high speed and it is for that reason that the same skid off the road and struck against a kikkar tree. As to how the number of the vehicle was noticed is a mystery. In fact, car No. HR26-S-9036 is owned by one of the persons known to the claimants. This is the reason that the same was implicated in the case when the claimants found that car bearing No. HR-08H-0007, which was in fact involved in the accident, was not insured and they may not be able to recover the amount of compensation from the owner thereof. Even if the story, as is mentioned FAO No. 1732 of 2005 [3] by the driver of car No. HR-26S-9036 in his statement while appearing as RW1, is considered as plausible, still the same will show that he was not negligent and the negligence would be on the part of the deceased only, who was driving car No. DL-2CM-3753. As to who had informed PW5-Naresh Kumar about the correct car number subsequently has not come on record. PW6-Raj Roop Singh, produced by the claimants, though claimed himself to be present close to the site of accident, could not state as to what were his killa numbers, which he was irrigating in the mid night on the date of accident. In any case, he also reached the spot of accident after it had already taken place. Similar is the position with regard to PW4- Yoginder Kumar, who was just following the car in which the deceased and PW5- Naresh Kumar were travelling, on a motor cycle.

6. The aforesaid facts, which emerge from the evidence led by the claimants, themselves would clearly establish that the story was not in the manner it is sought to be projected in the claim petition and the evidence led. In fact, car No. HR-26S-9036 was not involved in the accident.

7. The second issue raised is with regard to the quantum of compensation calculated by the Tribunal. It was submitted that the learned Tribunal has failed to reduce the amount of income tax paid by the deceased out of his salary, which as per Ex. PW3/B was at an average of Rs. 6,887.50 per month from April, 2003 to November, 2003. He further submitted that increase in the income of the deceased on account of future prospects in his service career was not called for as no one is assured of it and no evidence was led to justify the same. The application for deduction on account of multiplier and dependency is also challenged.

8. In support of his arguments regarding deduction of the amount of income tax, reliance was placed upon Andhra Pradesh State Road Trans. Corpn. and another v. M. Ramadevi and others, 2008 ACJ 930 and Oriental Insurance Co. Ltd. v. Ram Prasad Varma and others, 2009 ACJ 1006. Regarding multiplier, reliance was placed upon Tamil Nadu State Transport Corporation Ltd. v. S. Rajapriya and two others, JT 2005(4) SC 531. Regarding deduction of various allowances paid to the deceased, reference was made to Asha and others v. United India Insurance Co. Ltd. and another, (2004-1) 136 PLR 1. The judgment of Hon'ble the Supreme Court in State of Karnataka v. Muralidhar, 2009 ACJ 1526 was referred to point out the distinction between the words `negligence' and `rashness'. The judgments in Minu B. Mehta and another v. Balkrishna Ramchandra Nayan and another, 1977 ACJ 118; Municipal Corporation of Greater Bombay v. Laxman Iyer and another, 2004 ACJ 53 and Muralidhar's case (supra) FAO No. 1732 of 2005 [4] were relied upon in support of the plea that unless the negligence of the offending vehicle is proved, no compensation can be granted.

9, On the other hand, learned counsel for the claimants submitted that a lot of confusion is sought to be created by learned counsel for the Insurance Company regarding the site of the accident. The effort was made to project as if the vehicles were coming from different directions near the Bandh turn when the accident took place, whereas the fact is that all the three vehicles were coming to Israna from Samalkha side, which is connecting on Panipat-Rohtak road. Bandh turn is the place where the accident took place. PW5-Naresh Kumar, brother of the deceased, was on the back seat as he was not well and was being taken to the doctor. As the accident took place in the spur of moment in terms of the facts even admitted by RW1-Ramesh Kumar, driver of car No. HR26-S-9036, i.e. that on the crossing of car No. HR-08H-0007 immediately coming behind car No. HR26-S- 9036, hit the car of the deceased from behind, as a result of which it was diverted towards Khads and struck against a kikkar tree. The noting of number of the car involved in the accident initially as HR-08H-0007 by Naresh Kumar was spontaneous as it was the said car, which had immediately crossed the vehicle after the accident and in the lights of the car, he could notice its number. The FIR was got recorded at the earliest and even the number of the car was also corrected within an hour thereof. Under the circumstances, when the brother of the complainant had expired in the accident, such minor discrepancies can always be there. There was no motive with the complainant to have involved a wrong vehicle in the accident. Merely because one of the witnesses produced by the claimants could not tell his field numbers, where he was irrigating the land at the time of accident, will not be of much consequence. Practically no one remembers his field numbers in the rural area. It is not the kind of an urban property, where the people generally remember their own house numbers. The minor discrepancies in the statements of the witnesses show the truthfulness in their version and establish the fact that they had not been tutored. RW1-Ramesh Kumar, driver of car No. HR26- S-9036 had deposited the manner in which the accident occurred, which clearly establishes that it was on account of his negligence only. The reason therefor is that even if the argument of learned counsel for the Insurance Company is accepted that car No. HR-08H-0007 had already crossed the vehicle, being driven by the deceased when the accident in question took place, still the fact that car No. HR28-S-9036 had hit the car of the deceased from behind shows that it was being driven at a high speed and was not maintaining safe distance, on account of which he could not control his vehicle. The principles of res ipsa loquitur are clearly FAO No. 1732 of 2005 [5] applicable in the present case, as the events are speaking for themselves. Once the driver of the offending vehicle is being tried for rash and negligent driving by the criminal court, that fact itself is sufficient to opine that the accident had taken place on account of his negligence. The proceedings before the Tribunal are not like a criminal court where things are required to be proved beyond doubt. Here it is only preponderance of probabilities on appreciation of evidence.

10. As regards the quantum of compensation is concerned, the submission is that the plea raised by learned counsel for the Insurance Company regarding the amount of compensation being excessive is totally mis-conceived. In fact, the Tribunal has failed to apply correct multiplier, which should have been 14 as against 13 applied. As far as deduction of dependency is concerned, the same should also have been 1/4th as against 1/3rd applied. On account of the deduction made from the salary of the deceased, it was submitted that the amount on account of house rent allowance, shift allowance, canteen subsidy and over-time was not required to be deducted as these were all cash carry home. However, he fairly submitted that the amount paid by the employer of the deceased on account of conveyance and medical expenses may not be considered as cash carry home. He could not dispute that the amount of income-tax, which was deducted by the employer and deposited with the Income-tax Department cannot be said to be cash carry home salary. Further, the argument is that the rate of interest awarded by the Tribunal should have been 9% and not 6% per annum, as has been granted. However, in spite of asking of the court, learned counsel for the appellant did not furnish any calculation of the amount which, according to him, should be considered as carry home salary and the amount of compensation to which the claimants herein should be held entitled to, after application of correct deduction and multiplier.

11. Heard learned counsel for the parties and perused the paper book.

12. The learned Tribunal had framed the following issues for consideration in the claim petition:

"1. Whether the accident took place due to rash and negligent driving of Maruti Car No. HR26-S-9306 by respondent No. 1?OPP

2. Whether the petitioners are entitled to any compensation if so, how much and from whom ?OPP

3. Whether the respondent No. 1 was not holding a valid and effective driving licence at the time of accident, as alleged ?OPR

4. Relief."

FAO No. 1732 of 2005 [6]

13. Before I proceed to consider the respective arguments of learned counsel for the parties, I deem it appropriate to refer to a few precedents, which have relevance on the issue.

14. In Municipal Corporation of Greater Bombay's case (supra), Hon'ble the Supreme Court considered as to what the negligence is by observing as under:

"6. A plea which was stressed strenuously related to the alleged contributory negligence. Though there is no statutory definition, in common parlance `negligence' is categorised as either composite or contributory. It is first necessary to find out what is a negligent act. Negligence is omission of duty caused either by an omission to do something which a reasonable man guided upon those considerations who ordinarily by reason of conduct of human affairs would do or obligated to, or by doing something which a prudent or reasonable man would not do. Negligence does not always mean absolute carelessness, but want of such a degree of care is required in particular circumstances. Negligence is failure to observe, for the protection of the interests of another person, the degree of care, precaution and vigilance which the circumstances justly demand, whereby such other person suffers injury. The idea of negligence and duty are strictly correlative. Negligence means either subjectively a careless state of mind, or objectively a careless conduct. Negligence is not an absolute term, but is a relative one; it is rather a comparative term. No absolute standard can be fixed and no mathematically exact formula can be laid down by which negligence or the lack of it can be infallibly measured in a given case. What constitutes negligence varies under different conditions and in determining whether negligence exists in a particular case, or whether a mere act or course of conduct amounts to negligence, all the attending and surrounding facts and circumstances have to be taken into account. It is absence of care according to circumstances. To determine whether an act would be or would not be negligent, it is relevant to determine if any reasonable man would foresee that the act would cause damage or not. The omission to do what the law obligates or even the failure to do anything in a manner, more or method envisaged by law would equally and per se constitute negligence on the part of such person. If the answer is in the affirmative, it is a negligent act. Where an accident is due to FAO No. 1732 of 2005 [7] negligence of both parties, substantially there would be contributory negligence and both would be blamed. In a case of contributory negligence, the crucial question on which liability depends would be whether either party could, by exercise of reasonable care, have avoided the consequence of other's negligence. Whichever party could have avoided the consequence of other's negligence would be liable for the accident. If a person's negligent act or omission was the proximate and immediate cause of death, the fact that the person suffering injury was himself negligent and also contributed to the accident or other circumstances by which the injury was caused would not afford a defence to the other. Contributory negligence is applicable solely to the conduct of a plaintiff. It means that there has been act or omission on the part of the plaintiff which has materially contributed damage, the act or omission being of such a nature that it may properly be described as negligence, although negligence is not given its usual meaning. [See Charles, worth on Negligence, 3rd Edn., para 328]. It is now well settled that in the case of contributory negligence, courts have power to apportion the loss between the parties as seems just and equitable. Apportionment in that context means that damages are reduced to such an extent as the court thinks just and equitable having regard to the claim shared in the responsibility for the damage. But in a case where there has been no contributory negligence on the part of the victim, the question of apportionment does not arise. Where a person is injured without any negligence on his part but as a result of combined effect of the negligence of two other persons, it is not a case of contributory negligence in that sense. It is a case of what has been styled by Pollock as injury by composite negligence. [See Pollock on Torts, 15th Edn., p. 361]."

15. `Rash' and `negligent' are two different terms. Both have their own independent meanings. The dictionary meaning of `rash' is reckless, hasty, impetuous, careless, risky etc., whereas the meaning of word `negligent' is careless, inattentive, uncaring, thoughtless etc. At a given time, one may not be rash but can be negligent. In State of Karnataka v. Muralidhar's case (supra), Hon'ble the Supreme Court opined on the words `rashness' and `negligence' stating therein that `rashness' means doing an act with consciousness of a risk that evil consequences will follow but with the hope that it will not. `Negligence' is a FAO No. 1732 of 2005 [8] breach of duty imposed by law. `Rashness' consists in hazarding a dangerous or wanton act with the knowledge that it is so and it may cause injury.

16. In Minu B. Mehta and another v. Balkrishna Ramchandra Nayan and another's case (supra), Hon'ble the Supreme Court opined that the scope of negligence remains the lynch pin to recover compensation. The owner's liability arises out of his failure to discharge the duty cast on him by law. The right to receive compensation can only be against a person, who is bound to compensate due to the failure to perform a legal obligation. If a person is not liable legally, he is under no duty to compensate anyone else. Paragraph 28 of the judgment, which deals with the issue, is extracted below:

"28. This plea ignores the basic requirements of the owner's liability and the claimants right to receive compensation. The owner's liability arises out of his failure to discharge a duty cast on him by law. The right to receive compensation can only be against a person who is bound to compensate due to the failure to perform a legal obligation. If a person is not liable legally he is under no duty to compensate any one else. The Claims Tribunal is a tribunal constituted by the State Government for expeditious disposal of the motor claims. The general law applicable is only common law and the law of torts. If under the law a person becomes legally liable then the person suffering the injuries is entitled to be compensated and the Tribunal is authorised to determine the amount of compensation which appears to be just. The plea that the Claims Tribunal is entitled to award compensation which appear to be just when it is satisfied on proof of injury to a third party arising out of the use of a vehicle on a public place without proof of negligence if accepted would lead to strange results."

17. If the facts of the present case are considered in the light of the principles of law settled on the subject, it can safely be opined that the accident in the present case had occurred on account of negligence of driver of vehicle No. HR26-S-9036. It is for the reason that it has come on record that the driver of the aforesaid vehicle appearing as RW-1, admitted in his statement that he had hit the car being driven by deceased-Rishi Dev from the back side, though the same is sought to be explained by stating that it was for the reason that when another car No. HR-08H-0007 crossed the car in which the deceased was travelling, he lost control of his car and car No. HR26-S-9036, which was just coming behind hit it from the back side. Suffice it to state that if the car of the deceased was hit in the FAO No. 1732 of 2005 [9] manner admitted by the driver of car No. HR26-S-9036, that would simply mean that the driver thereof was not keeping safe distance from the vehicle going ahead of it and on account of other vehicle even if it had gone on one side on account of a fast vehicle crossing it, the vehicle coming behind that was supposed to apply brakes and slow down its vehicle. However, it was not done and on that account, the accident took place. It was also admitted by him that he was being prosecuted for negligent driving.

18. Further the argument raised by learned counsel for the Insurance Company regarding change of vehicle number also has no legs to stand for the reason that it was all spontaneous. It has come in the evidence on record that both the vehicles, namely, HR-08H-0007 and HR26-S-9036 had crossed at the same time. If initially number of the other vehicle was given, the same can be a bonafide error for the reason that a person, whose brother had suffered serious injuries in an accident, would certainly be upset at that time. The argument that vehicle number was changed for the reason that car No. HR-08H-0007, which caused the accident was, in fact, not insured and when this fact was found, a new vehicle was introduced, has no legs to stand. It has come on record in the form of insurance policy (Ex. P2) that car bearing No. HR-08H-0007 was duly insured with New India Assurance Company Limited. Nothing has come on record to suggest that the owner of car No. HR-26S-9036 was known to the claimants and the car was involved in the accident in connivance with the claimants. Number of the car was even corrected by Naresh Kumar, eye-witness to the accident, within one hour of getting the FIR registered in his supplementary statement. There was no motive with the claimants to have implicated an innocent person in the accident, as nothing has come on record to suggest in that direction. Minor discrepancies in the oral evidence led do not go to the extent of putting a dent in the positive evidence led by the claimants on the preponderance of which it can safely be concluded that the accident was caused on account of rash and negligent driving of vehicle No. HR-26S-9036. The finding of the Tribunal on that account cannot be held to be perverse. Accordingly, the same is upheld.

19. The next issue which arises for consideration is regarding the quantum of compensation. Both the parties raised arguments on the issue. The contention of learned counsel for the Insurance Company was that certain deductions, which were required to be made while calculating the carry home income of the deceased, were not taken care of, such as income-tax, whereas the submission of learned counsel for the claimants was that certain unnecessary deductions have been made from the salary which, in fact, were not required to be FAO No. 1732 of 2005 [10] made and the compensation deserve to be enhanced further.

20. There are two documents on record showing the income of the deceased, who was serving with Pawan Hans Limited as Section Engineer - one is salary slip (Ex. PW3/A) for the month of October, 2003 and another is Ex. PW3/B, salary card for the year 2003-04, i.e., from April, 2003 to November, 2003, when Rishi Dev expired in the accident. A perusal of both the documents shows that there was difference in the carry home monthly salary of the deceased from April to November, 2003. It was on account of difference in various allowances being paid to him on account of over-time, medical reimbursement, conveyance etc. The primary objection raised by learned counsel for the Insurance Company was to the income-tax deduction, over time, provident fund, shift and conveyance allowance which, according to him, were not required to be considered for the purpose of calculation of income of the deceased and consequently his dependency, in addition to the amount which was deducted by the Tribunal. Though learned counsel for the claimants disputed the argument raised by learned counsel for the Insurance Company for deductions on all other heads but he could not possibly dispute that the amount of income tax deducted out of the salary could not be considered for the purpose of calculation of carry home income and consequently the dependency.

21. A perusal of the impugned award shows that the learned Tribunal had considered the gross and carry home salary of the deceased for the month of October, 2003. The gross salary for the aforesaid month was Rs. 39,958.91 and the net carry home salary was Rs. 30,317.59. The learned Tribunal after reducing a sum of Rs. 9,355.81 from the carry home salary on account of house rent allowance, shift allowance, over time allowance, conveyance allowance, medical allowance, canteen subsidy, the balance income was assessed at Rs. 20,961.78, to which adding about Rs. 4,000/- on account of future prospects of advancement of career and increase of pay, the monthly carry home income was taken as Rs. 25,000/-, i.e., Rs. 3,00,000/- per annum and applying a cut of 1/3rd and further 13 as a multiplier, the amount of compensation was assessed at Rs. 26,00,000/-, to which another sum of Rs. 50,000/- was added on account of expenses on last rites and loss of consortium.

22. The principle adopted by the Tribunal regarding calculation of the carry home salary and consequently the amount of compensation payable on account of the death of Rishi Dev, in my opinion, is not correct. The learned Tribunal had merely considered the carry home salary for one month preceding the FAO No. 1732 of 2005 [11] month in which the accident took place. A perusal of Ex. PW3/B, which is salary card of the deceased from April, 2003 to November, 2003 shows that there is variation in various allowances being paid to the deceased during this period.

23. In the facts of the present case and considering the variation and carry home salary of the deceased during 8 months of the year from April, 2003 to November, 2003, it would not be safe to merely rely upon the salary for one month as the carry home salary of the deceased varied from Rs. 26,486.24 to Rs. 38,239.16. In my opinion, considering the variation in the salary on account of different allowances, it would be safe to take an average of the salary of the deceased from April, 2003 to November, 2003.

24. A perusal of the impugned award shows that the learned Tribunal had not taken into consideration various deductions made while calculating the carry home salary with reference to the fact as to whether those should be considered as part of the carry home salary or not, such as the savings for the provident fund is also in the kind of a saved earning and similar is the position with regard to shift allowance or over-time allowance, which is paid in cash. The total gross salary of the deceased for 237 days, he worked from April, 2003 to November, 2003 was Rs. 3,32,340/-. The deductions, which are required to be made out of the gross salary on account of the fact that the same are merely re-imbursement of certain expenses are enumerated below:

       "Kit Maintenance                                11,020.00
         Tel./File/                                     3,093.33
         LTC Encashment                                 8,988.00
         Income-tax                                    55,100.00
         Conveyance                                     7,929.93
         Medical                                       14,916.37
         Canteen                                        8,000.00
         Books & PE                                     3,093.33
                                                       -------------
               Total:                                1,17,475.00"

25. If the aforesaid deductions are made out of the gross earning of the deceased, the net carry home salary for the period of 237 days comes out to Rs. 2,14,865/-, which comes out to Rs. 27,198/- per month and rounded off to Rs. 27,200/-. The annual dependency would come out to Rs. 3,26,400/-. Considering the number of dependents, the learned Tribunal applied a cut of 1/3rd, which cannot be faulted with. After reducing a sum of Rs. 10,800/- per month therefrom, the annual dependency comes out to Rs. 2,17,600/- to which, in my opinion, a FAO No. 1732 of 2005 [12] multiplier of 12 would be reasonable. If calculated, after applying the aforesaid multiplier, the amount of compensation would come out to Rs. 26,11,200/-. The learned Tribunal had assessed the compensation at Rs. 26,00,000/-, which is quite close to the amount assessed above. Accordingly, I do not find any reason to interfere with he impugned award on account of amount of compensation assessed. There is neither any pleading nor evidence in support of the claim for future prospects, hence, the claim to that effect is rejected.

26. The appeal and the cross-objections are dismissed.

(Rajesh Bindal) Judge March 15,2010 mk (Refer to Reporter)

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