Gujarat High Court
National Insurance Co. Ltd. vs Mukeshbhai Bhalchandrabhai Jani Decd. ... on 25 September, 2003
Equivalent citations: II(2004)ACC310, 2004ACJ1533
JUDGMENT Kshitij R. Vyas, J.
1. The two Insurance Companies, i.e. National Insurance Company and New India Assurance Company, have challenged the order dated 25th January 2001 passed below application Exh.25 in Motor Accident Claim Petition No. 576 of 1996, whereby the Motor Accident Claims Tribunal (Aux.), Bhavnagar awarded compensation of Rs.5,21,500/under Section 163-A of the Motor Vehicles Act, 1988 (for short, "the Act") together with interest at the rate of 12% from the date of Claim Petition Exh.1, i.e. 30th August 1996 till the date of deposit as also with the proportionate costs.
2. In the Claim Petition filed by the heirs of deceased Mukeshbhai Balchandra Jani who expired in the motor accident which took place on 16.6.1996, it is averred that the deceased himself was driving the jeep on the Bhavnagar-Rajkot Highway when the accident occurred in the night hours. One Tempo (Chhakado) No. GJ-4-T-7944 was coming from the opposite direction when another vehicle - Truck bearing No.GTS-6818 tried to overtake the Tempo and in the process, hit the Tempo with the result, the three vehicles dashed. As a result of the said accident, Mukeshbhai expired.
3. The claimants filed the Claim Petition under Section 166 of the Act on 30th August 1996 wherein they claimed Rs.5,00,000/- with 15% interest from the date of the application till realisation on account of the untimely death of the deceased Mukeshbhai. It appears that the claimants also filed an application under Section 140 of the Act, being Exh.5, claiming interim compensation. However, no order was passed in the said application. The present application under Section 163-A came to be filed by the claimants on 23rd August 2000 whereby the claimants claimed Rs.4,53,000/by way of interim compensation. The Motor Accident Claims Tribunal (Aux.), Bhavnagar, by its order dated 25th January 2001 granted the said application under Section 163-A of the Act, by directing the present appellants Insurance Companies to pay compensation of Rs.5,21,500/with interest at the rate of 12% from the date of the claim petition, i.e. 30th August 1996 till the date of deposit with proportionate costs. As observed earlier, this order of the Tribunal is under challenge in the present appeals filed under Section 173 of the Act.
4. It appears that during pendency of this appeal, in May 2003, the claimants filed a purshis before the Tribunal by exercising option by stating that the amount awarded by the Tribunal be treated as the final award under Section 163-A of the Act as the claimants did not want to pursue the original application filed under Section 166 of the Act. It appears that the applicant filed this application in view of the decision rendered by the Apex Court in the case of Oriental Insurance Co. Ltd. v. Hansrajbhai V. Kodala, reported in (2001) 5 SCC 175 and the Tribunal granted the said application by impugned order.
5. We have heard learned Counsel Mr. Dakshesh Mehta appearing for the appellant - National Insurance Company in First Appeal No. 937 of 2001 and Ms. Lilu Bhaya, learned Counsel appearing for the appellant New India Assurance Company in First Appeal No.2110 of 2001 and Mr. D.C. Sejpal, learned Counsel appearing for the common opponents-claimants in both the appeals.
Learned Counsels for the appellants submitted that the option exercised by the claimants by filing application under Section 163-A of the Act after the award passed by the Tribunal is not tenable. In the submission of learned Counsel, the option is required to be exercised at the initial stage. They further submit that the impugned award in these appeals was made as an interim award under Section 163-A of the Act and therefore, the same is required to be set aside when the main application under Section 166 of the Act is pending. Reliance is placed on the decision of the Apex Court in the case of Oriental Insurance Company Ltd. v. Hansrajbhai V. Kodala and ors., reported in JT 2001 (4) SC 477. Learned Counsel further submit that in the application filed under Section 166 of the Act, the negligence aspect is required to be decided by the Tribunal. Since the claimants in the instant case have filed interim application under Section 163-A of the Act by exercising option, the Insurance Companies are deprived of challenging the claim of the claimants on the question of negligence as well as quantum.
01/10/2003 On the other hand, learned Counsel appearing for the respondents-claimants submits that the claimants are entitled to convert the claim petition filed under Section 166 of the Act to a petition under Section 163-A of the Act either during pendency of the proceedings before the Tribunal or at the appellate stage. Therefore, the Tribunal is justified in passing the order permitting the claimants to withdraw the original application filed under Section 166 of the Act. To substantiate his submission, reliance is placed in the case of Guruanna Vadi and anr. v. The General Manager, K.S.R.T.C., rendered by the Karnataka High Court reported in AIR 2001 Karnataka 275, and a decision rendered by this Court in First Appeal No. 3110 of 2001 dated 30th August 2001 (Coram: Y.B. Bhatt & H.H. Mehta, JJ.).
5.1 We have carefully considered the rival submissions as well as provisions of law relied on and the decisions cited by them in support of their submissions.
6. This Court in the case of Oriental Insurance Co. Ltd. v. Chintharbhai Sibabhai and ors., reported in 2003 (1) GLH 394 (in which one of us K.R. Vyas, J.) while dealing with the very contention as advanced before us, viz. that the Insurance Companies did not have any opportunity to challenge the income of the deceased because this was an application for interim compensation which has been decided by the Tribunal without any evidence on record, ruled that it is not necessary that while deciding the application under Section 163-A, the opportunity to the Insurance Company is required to be given to challenge the income of the deceased. In the said case, almost identical facts were there, viz. that claimants have filed application under Section 140 and the other application under Section 163-A of the Act. In that case also, with respect to application under Section 140, the Tribunal has not passed the order initially. Therefore, the contention was raised that during pendency of the application under Section 166, the order in application under Section 163-A cannot be passed by the Tribunal. Similarly, in the present case also, learned Counsel appearing on behalf of the claimants made a statement that the main petition under Section 166 of the Act has been withdrawn by the claimants. Considering almost identical situation, this Court observed as under:
"........ In such a situation, the contention raised by learned Advocate Ms. Megha Jani has been examined in light of the fact that if the claimants have not filed application under Section 166 of the Act, and straightway only one application may be filed under Section 163-A of the Act. In such circumstances, if the claimants have not filed application under Section 166 of the Act, then can it be possible that the Tribunal is not entitled to examine the application under Section 163-A of the Act? The Tribunal, in such a situation, is having suo motu powers to decide such application under Section 158(6) read with Section 166(4) of the Act. Therefore, according to our opinion, the contention which has been raised by learned Advocate Ms. Megha Jani cannot be accepted simply on the ground that it is a statutory remedy available to the claimants in case of vehicular accident. Three remedies are open to the claimants -- (i) under Section 166, (ii) under Section 140 and (iii) under Section 163-A of the Act. The claimants can file appropriate application either under Section 166 as well as under Section 140 or under Section 163-A of the Act. The Tribunal is duty bound to consider the application when statutory provision is made by the Legislation. Therefore, according to our opinion, and looking to the provisions made under Section 163-A and Schedule-II, there is no need to give any opportunity to the Insurance Company in respect to challenge the income of the deceased. It is a statutory provision binding to the Tribunal to decide such application on the basis of the evidence which has been produced by the claimants before the Tribunal. Sub-section (2) of Section 163-A is very clear and it gives power to decide such application like "no fault liability" similar to Section 140 of the Act."...
This Court ultimately held as under:
"....According to our opinion, the Tribunal has rightly examined the application and decided the same in accordance with law. We are in total agreement with the finding and the ultimate conclusion given by the Tribunal. The contention which has been raised by learned Advocate Ms. Megha Jani is, therefore, rejected. There is no error committed by the Tribunal while deciding the said application and, therefore, according to our opinion, there is no substance in the present appeal and hence, the same is dismissed, with no order as to costs."
In Oriental Insurance Co. Ltd. v. Vinodkumar Jaysukhbhai Devba Gate and ors., while deciding First Appeal No. 3110 of 2001, the Division Bench of this Court (Coram: Y.B. Bhatt & H.H. Mehta, JJ.) vide order dated 30.8.2001 held that the contention raised on behalf of the Insurance Company viz. that the award under Section 163-A cannot be treated as an interim award particularly in view of the fact that the claim petition under Section 166 of the Act was at that time pending before the Claims Tribunal. To substantiate the said contention, learned Counsel for the appellant Insurance Company also placed reliance on the decision rendered by the Supreme Court in the case of Oriental Insurance Co. Ltd. v. Hansrajnhai V. Kodala and ors., reported in JT 2001 (4) SC 477. The Division Bench while following the principles laid down by the Supreme Court in the said decision, observed that an application made by the claimant for an award under Section 163-A cannot be treated as an application for an interim award, nor can an award under Section 163-A be deemed to be or designated to be an interim award pending the final award passed under Section 168 on an application under Section 166 of the said Act. In the said case also, the claimant withdrew the claim petition under Section 166 of the Act and a statement to that effect was made before the Court. The Division Bench, under the circumstances, held that the award under Section 163-A of the Act which is the subject matter of that appeal, can be considered as a final award.
7. In view of the above decisions, it is clear beyond any manner of doubt that the claimant who is having three statutory remedies available, (i) under Section 166(ii) under Section 140, and (iii) under Section 163-A of the Act can exercise any of the said remedies. The Tribunal is duty bound to consider the application. As far as the case on hand is concerned, the claimants are justified in withdrawing the original application filed under Section 166 of the Act and praying for the award under Section 163-A of the Act. In taking this view, we are also supported by the decisions of the Full Bench of the Karnataka High Court rendered in the case of Guruanna Vadi and anr. v. The General Manager, K.S.R.T.C., and anr. reported in AIR 2001 Karnataka 275. It is held in the said decision that the claimant can move the Court for amendment of his claim petition filed under Section 166 to that of a petition under Section 163-A at any stage of the proceedings and it would be for the concerned Court to pass an order on that application in accordance with law, provided he satisfies other conditions such as the income factor etc. and the only bar provided for exercising an option in the matter of filing a claim petition for compensation is to be found in Section 163-B which states, 'where a person is entitled to claim compensation under Section 140 and Section 163-A, he shall file the claim under either of the said sections and not under both.
8. Learned Counsel Ms. Lilu Bhaya for the appellant New India Company Assurance Company, after inviting our attention to the judgment rendered by the Apex Court in the case of Oriental Insurance Co. Ltd. v. Hansrajbhai V. Kodala (supra), wherein the Apex Court has held that the compensation under Section 163-A is an alternative and not in addition to compensation payable under Section 168, submits that since the claimants in the instant case have opted to claim compensation in addition, the Insurance Company is denied the right to cross examine on the question of income of the deceased and therefore, she requested that the matter be remanded to the Tribunal. Same is the submission of Mr. Mehta also. We are not impressed with the submission advanced by the learned Counsel and the same is required to be rejected for the simple reason that the claimants withdrew the application filed under Section 166 of the Act and have restricted their claim to the amount awarded under Section 163-A of the Act to be treated as final award. True, the Tribunal, in the facts and circumstances of the case, has awarded Rs.5,21,500/- with interest at the rate of 12% against the claim of Rs.4,53,000/- by way of interim compensation, which is beyond the scope of Sec.163-A of the Act. Even otherwise also the amount of Rs.5,21,500/awarded by the Tribunal is also more than the claim made in the claim petition under Section 166 of the Act, which was Rs.5,00,000/- only. Learned Counsel Mr. Sejpal appearing for the claimants has fairly conceded that there is an error committed by the Tribunal and he has restricted his claim to Rs.4,53,000/- submitting that the same may be treated as final award of compensation. In view of this, we see no merits in the submission of the learned Counsels for the appellant Insurance Companies that because of the addition in the compensation, the matter is required to be remanded to the Tribunal.
In view of the aforesaid discussion, we see no merits in the submission advanced by the learned Counsel for the appellant Insurance Companies.
9. Now, the question remains to be decided is as to what rate of interest can be awarded and from which date? The Tribunal, in the instant case, has awarded interest at the rate of 12% from the date of the claim petition, i.e. 30th August 1996 till the date of deposit with proportionate cost. In view of the judgment rendered by the Apex Court in the case of Khushnuma Begam and ors. v. New India Assurance Co. Ltd. and ors., reported in (2001) 2 SCC 9, learned Counsel Mr. Sejpal for the claimants has frankly conceded that instead of awarding interest at the rate of 12%, interest at the rate of 9% may be awarded from the date of the original claim petition filed under Section 166 of the Act, i.e. 30th August 1996. Learned Counsel appearing for the Insurance Companies resisted this claim by contending that the claimants are entitled to interest from the date of the order of the Tribunal, permitting the claimants to withdraw the application filed under Section 166 of the Act, i.e. May 2003. According to learned Counsel for the Insurance Companies, since the claimants have withdrawn the original application filed under Section 166 of the Act, they are not entitled to claim interest from 30th August 1996, the date on which the application is filed. Learned Counsel for the Insurance Companies, by inviting our attention to Second Schedule of the Act, submitted that the interest cannot be awarded from such a date not earlier than the date of the order of the Tribunal allowing withdrawal of the original claim petition filed under Section 166 of the Act. We see no merits even in this submission. In the original application filed under Section 166 of the Act, the claimants have made claim for the above said compensation. The claimants, in the instant case, have exercised their statutory right and have opted for claim under Section 163-A of the Act and therefore, have not given up their claim against the Insurance Companies. This is not a case where after withdrawing the original application, a separate application is filed. By filing a purshis before the Tribunal, the claimants have made claim that they are prepared to accept the compensation under Section 163-A of the Act. Instead of going through the long procedure under Section 166 of the Act, the cause of action has remained the same, and therefore, for all practical purposes, even by withdrawing the original application against the Insurance Companies, continues. The Apex Court in the case of Abati Bezbaruah v. Dy. Director General, Geological Survey of India and anr., reported in (2003) 3 SCC 148, while interpreting Section 171 of the Act, has observed as under:
"18. ....No rate of interest is fixed under Section 171 of the Motor Vehicles Act, 1988. Varying rates of interest are being awarded by Tribunals, High Courts and the Supreme Court. Interest can be granted even if a claimant does not specifically plead for the same as it is consequential in the eye of law. Interest is compensation for forbearance or detention of money and that interest being awarded to a party only for being kept out of the money which ought to have been paid to him. No principle could be deduced nor can any rate of interest be fixed to have a general application in motor accident claim cases having regard to the nature of provision under Section 171 giving discretion to the Tribunal in such matter. In other matters, awarding of interest depends upon the statutory provisions, mercantile usage and doctrine of equity. Neither Section 34 CPC nor Section 4-A(3) of the Workmen's Compensation Act are applicable in the matter of fixing rate of interest in a claim under the Motor Vehicles Act. The Courts have awarded the interest at different rates depending upon the facts and circumstances of each case. Therefore, in my opinion, there cannot be any hard-and-fast rule in awarding interest and the award of interest is solely on the discretion of the Tribunal or the High Court as indicated above."
The above decision certainly helps the claimants. We accordingly award interest at the rate of 9% on the amount of compensation of Rs.4,53,000/- from 30th August 1996 till the amount is deposited. Learned Counsel for the Insurance Companies states that since both the Insurance Companies have filed separate appeals before this Court, and have deposited the amount of Rs.4,53,000/- each together with interest and cost as per the directions of the Tribunal, the Tribunal may be directed to refund the excess amount after apportioning the liability of the Insurance Companies at 50:50 ratio. Hence, the Tribunal is directed to fix the liability of the Insurance Companies at 50:50 ratio.
10. Having considered the case, in our opinion, the claimants are entitled to get compensation of Rs.4,36,167/- which is not disputed either by learned Counsel for the Insurance Companies as well as learned Counsel Mr. Sejpal appearing for the claimants. We accordingly pass the following order:
The claimants are entitled to get compensation of Rs.4,36,167/- (Rupees For lacs thirty-six thousand and one hundred sixty seven only) with 9% interest from 30th August 1996 till the amount is deposited. The Tribunal shall refund the excess amount deposited by the two Insurance Companies in 50:50 proportion. The Tribunal is further directed to disburse the amount to the claimants as under:
Out of the total amount of compensation, claimants No.3 - Vasantben Bhalchandra Jani and claimant No.4 - Vishwas Bhalchandra Jani shall be entitled to 25% each. Claimant No.2 - Krishna Mukeshbhai Jani, who is minor will be entitled to get 30% which shall be invested in any Nationalised Bank in FDRs till she attains majority. Rest of 45% amount shall be paid to (1) Ranjanben Mukeshbhai Jani, widow of the deceased. The balance amount shall be paid to the claimants by account payee cheque on or before 17th Oct.2003 and the excess amount shall be paid to both the Insurance Companies equally. Both the appeals are partly allowed. No order as to costs as far as these appeals are concerned. Direct service is permitted.
11. In view of the order passed in the main appeals, the Civil Applications do not survive and are disposed of accordingly.