Gujarat High Court
Sukhiben Wd/O Jayantibhai Bachubhai ... vs Kaushikkumar Manvarbhai Bhagat on 12 February, 2025
NEUTRAL CITATION
C/FA/3653/2018 ORDER DATED: 12/02/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 3653 of 2018
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SUKHIBEN WD/O JAYANTIBHAI BACHUBHAI RATHWA & ORS.
Versus
KAUSHIKKUMAR MANVARBHAI BHAGAT & ORS.
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Appearance:
MR R G DWIVEDI(6601) for the Appellant(s) No. 1,2,3,4
MR PALAK H THAKKAR(3455) for the Defendant(s) No. 3
NOTICE SERVED for the Defendant(s) No. 1
SERVED BY GOVERNMENT GAZETTE for the Defendant(s) No. 2.1,2.2
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CORAM:HONOURABLE MR. JUSTICE J. C. DOSHI
Date : 12/02/2025
ORAL ORDER
1. The present First Appeal, under Section 173 of Motor Vehicles Act, 1988, is preferred by the appellants being aggrieved and dissatisfied with the judgment and award dated 25.4.2018 passed by the Motor Accident Claims Tribunal, Chhotaudepur in Motor Accident Claim Petition No.383 of 2017 (Old No.1875 of 2003).
2. Brief facts of the case are as under:
2.1 The brief fact of present case is that while on 20.6.2003 at about 04.30 a.m. deceased was labour and was travelling on Tractor No. GJ-6-A-9302 & Trolley No. GJ-X-2894 as labourer for loading-unloading of soil at that time while tractor was climbing on ascent road at that time due to rash and negligent driving of respondent No.1, he lost control over vehicle and front Page 1 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined wheels of tractor got hung up, in result deceased fell down on the road and wheels of trolley rolled over his body and accident occurred. In same accident grievous injuries were sustained by the deceased and he succumbed to same injuries.
3. Learned advocate for the appellants - claimants has submitted that the Tribunal has committed an error in not properly calculating the amount of compensation. He has submitted that amount of award is on lower side as the Tribunal has not properly considered the various aspects; like prospective income of the deceased, negligence, liability and family circumstances, etc. He has submitted that the learned Tribunal has erred in exonerating respondent No.3 Insurance Company from paying compensation and holding that only respondent Nos.1 and 2 are liable to pay the compensation. He has submitted that the learned Tribunal has erred in deducting 1/3rd of the considered income towards personal expenses of the deceased. He has further submitted that the learned Tribunal has assumed the income of Rs.2,200/- per month. The income of the deceased ought to have considered at Rs.3000/-
per month.
3.1 He has submitted that the compensation is required to be enhanced by modifying the award impugned accordingly and this appeal may be allowed.
4. Learned advocate for the appellants has also submitted that the learned Tribunal erroneously exonerated the insurance company on the ground that the deceased was sitting on Page 2 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined mudguard of the tractor as passenger. He would further submit that the dc was admittedly engaged on the tractor to off-load the soil filled in the trailer part of the tractor. He would further submit that insurance policy of the tractor shows sitting capacity of the tractor was 1 + 1 and premium for legal liability of employee/labourer has been taken and in that circumstances, the insurance company is liable to pay compensation indemnifying risk of the owner of the vehicle. He would further submit that the learned Tribunal erroneously held that the insurance policy issued in name of dead person and therefore, the contract of the policy stood void. He would further submit that the learned Tribunal while writing such finding, failed to notice the law laid down by the Hon'ble Apex Court in case of United Insurance Company Limited Vs. Santro Devi and others, (2009) 1 SCC 558. He would further submit that the insurance company did not raise contention that the contract was obtained by fraud and was not validly executed. He would further submit that in view of such position of law, the learned Tribunal erred in exonerating the insurance company from liability to pay the compensation.
5. Per contra, learned advocate for respondent - Insurance Company has submitted that the impugned judgment and award passed by the Tribunal is just and proper. The Tribunal has rightly considered the income of the deceased, the age of the deceased, the dependency and future aspect of income. He has submitted that under the head of loss of estate and funeral expenses, the Tribunal has rightly awarded compensation. He has submitted that the amount under the head of loss of Page 3 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined consortium is just and proper. He has submitted that owner of the tractor expired before renewal of the policy and hence, there was no valid contract of insurance. He has further submitted that the deceased was traveling by sitting on mudguard of the tractor and hence, his risk was not covered in the policy. He has submitted that this appeal may be dismissed and no interference be made by this Court.
6. Apt to note that the Motor Vehicle Act, 1988 is a beneficial piece of Legislation. The concept of just and fair compensation is integral and seminal to the MV Act. The compensation to be awarded under the principle of just and fair compensation to the injured of the road accident or the legal representative/s of the deceased person is based on the principle of fairness, reasonableness and equability. Anguish of the heart or for mental turbulence being consequential result of the road accident cannot be actually compensated, but the quint essentiality lies in adopting holistic and pragmatic view to the computation of the compensation for the loss sustained, which is to be in the realm of realistic approximation. Although exact or perfect arithmetical calculation of compensation for reparation of the loss arrived from the road accident is almost impossible. The Tribunal is bestowed with duty to make an endevour to award just compensation regardless of the amount claimed by the claimants. The determination of the quantum of compensation therefore, must be liberal and not niggardly since the law values life and limb in a free country in generous scale. Needless to state that money may be awarded, so that something tangible may be procured to reach something else of the like nature, Page 4 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined which has been destroyed or lost, but money cannot renew physical frame that has been battered and shattered being a result of the road accident. Yet Tribunal to endavour to bring back victim to stage of pre-road accident as far as possible. Thus, the award must be reasonable and cannot be assessed with moderation though it cannot at the same time be pity and what could be granted must be just, fair and equitable compensation.
7. What could be noticed that the learned Tribunal has fixed following issue to determine the claim petition.
"1. Whether the claimants prove that the vehicle of the opponent was involved and the driver of said vehicle was negligent in the accident?
2. Whether the claimants prove that the deceased died due to the injuries caused in the accident?
3. Whether the claimant are entitled for the compensation? If, yes, how much amount?
4. Whether the insuarance company proves that the insurance was taken by concealing the fact that the owner of the vehicle though got expired not been disclosed to require authorities and so the policy is void and insurance company is not liable to indemnify the resposibility of owner?
5. Whether the claimants are entitled for the interest ? If, yes, at what rate?
6. What order?
8. Amongst the aforesaid issues, issue No.4 is in regards to whether the valid contract of policy is executed and whether in case when owner was dead, the contract of the policy can be termed as void? The learned Tribunal answered issue No.4 in affirmative and held that since the insurance policy of the tractor Page 5 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined was issued in name of dead person, the contract being void contract, the insurance company cannot be held liable to pay compensation.
9. On perusal of the impugned judgment and award, it appears that the learned Tribunal has exonerated the insurance company on two count. Firstly, that the deceased was travelling as gratuitous passenger on mudguard of the tractor. The finding of the learned Tribunal is erroneous on the ground that the insurance policy of the tractor on record demonstrates sitting capacity of 1 + 1. The insurance company has charged Rs.25/- for the legal liability of employee/labourer engaged on the work of the tractor, it is unlimited liability. Learned advocate Mr. Palak Thakkar is not in a position to get away from this aspect that since the insurance company has charged Rs.25/- covering risk of the employee/labourer engaged in the tractor and taking up the liability to pay the compensation.
10. Perusal of cross-examination of the claimants also indicates that suggestion has been made in the cross- examination made by learned advocate for the insurance company that the deceased was working as labourer on the tractor to off-load the soil filled in the tractor. The suggestion itself is indicative of the fact that the insurance company has also accepted that the deceased was working as labourer/employee on the tractor. Charging of premium of Rs.25/- towards legal liability is sufficient to mark liability upon the insurance company to pay compensation and therefore, the insurance company cannot escape from its liability to pay Page 6 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined compensation to the claimants.
11. Another finding of the learned Tribunal to exonerate the insurance company is that the owner of the tractor has expired five years back and therefore, the insurance policy is issued in name of dead person and therefore, as such, it is void contract and does not entrust liability upon the insurance company to pay compensation.
12. When the issue was questioned to learned advocate Mr. Thakkar that if the owner of the vehicle has expired, then from whom, the insurance company was taking up premium, learned advocate advocate Mr. Thakkar fairly submitted that the insurance policy is old one and being renewed from year to year. He also fairly submitted that the premium has been taken up to renew the policy and it covers the date of the accident. What could be noticed that the insurance company has renewed the insurance policy on year to year basis on receipt of premium, may be with or without knowledge that whether the owner of the vehicle is alive or expired. Since the policy is executed on accepting heavy amount without insisting to bring on record legal heirs and representatives on record and in absence of any pleadings of proof of committing fraud, the insurance company cannot say that it was not bound to satisfy the claim of the third party. Second contention is also impermissible to sustain.
13. Identical issue has been decided by the Hon'ble Apex Court in case of nited India Insurance Company Limited vs. Santro Devi and others, reported in (2009) 1 SCC 558, the Hon'ble Apex Page 7 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined Court has held as under:
"10. The Motor Vehicles Act, 1988 was enacted to consolidate and amend the law relating to motor vehicles. Chapter XI of the Motor Vehicles Act provides for insurance of motor vehicles against third-party risks. Section 145 is the definition section, clause (b) whereof defines "certificate of insurance" to mean a certificate issued by an authorised insurer in pursuance of sub-section (3) of Section 147 and includes a cover note complying with such requirements as may be prescribed, and where more than one certificate has been issued in connection with a policy, or where a copy of a certificate has been issued, all those certificates or that copy, as the case may be. Clause (d) of Section 145 defines "policy of insurance" which includes a certificate of insurance.
11. Section 146 mandates that no person, except as a passenger, shall use or cause or allow any other person to use, a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of the said Chapter.
12. Section 147 provides for the requirements of policies and limits of gliability in the following terms:
"147. (1)(a) is issued by a person who is an authorised insurer; or (b) insures the person or classes of persons specified in the policy to the extent specified in sub-section (2)-
(i) against any liability which may be incurred by him in respect of the death of or bodily injury to any person, including owner of the goods or his authorised representative carried in the vehicle or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;Page 8 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025
NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined
(ii) against the death of or bodily injury to any passenger of a public a service vehicle caused by or arising out of the use of the vehicle in a public place:"
The proviso appended thereto reads as under:
"Provided that a policy shall not be required-
(i) to cover liability in respect of the death, arising out of and in the course of his employment, of the employee of a person insured by the b policy or in respect of bodily injury sustained by such an employee arising out of and in the course of his employment other than a liability arising under the Workmen's Compensation Act, 1923 (8 of 1923), in respect of the death of, or bodily injury to, any such employee-
(a) engaged in driving the vehicle, or
(b) if it is a public service vehicle engaged as conductor of the vehicle or in examining tickets on the vehicle, or
(c) if it is a goods carriage, being carried in the vehicle, or
(ii) to cover any contractual liability."
13. The insurer could deny its liability on limited grounds as envisaged under sub-section (2) of Section 149 of the Act. One of the grounds which is available to the insurance company for denying its statutory liability is that d the policy is void having been obtained by reason of non-disclosure of a material fact or by a representation of fact which was false in some material particular.
14. Indisputably, apart from raising a general and vague plea of fraud, no particulars thereof had been disclosed. The contract of insurance was entered into Page 9 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined by the bank with the appellant. The premium was paid by the bank. The contract of insurance might have been drawn in the name of the deceased Atma Ram Sharma but no witness has been examined on behalf of the appellant alleging that they were not aware thereabout.
15. When questioned, Mr Mehra, very fairly stated that the insurance policy was an old one and it was being renewed from year to year. If the f appellant had been renewing the insurance policy on a year-to- year basis on receipt of a heavy amount of premium with the knowledge that the owner of the vehicle has expired and the name of his legal heirs and representatives had not been transferred in the registration book maintained by the authorities under the Motor Vehicles Act, in our opinion, the appellant cannot be heard to say that it was not bound to satisfy the claim of a third party.
16. The provisions of compulsory insurance have been framed to advance a social object. It is in a way part of the social justice doctrine. When a certificate of insurance is issued, in law, the insurance company is bound to reimburse the owner. There cannot be any doubt whatsoever that a contract of insurance must fulfil the statutory requirements of formation of a valid contract but in case of a third- party risk, the question has to be considered from a different angle.
17. Section 146 provides for statutory insurance. An insurance is mandatorily required to be obtained by the person in charge of or in possession of the vehicle. There is no provision in the Motor Vehicles Act that unless the name(s) of the heirs of the owner of a vehicle is/are substituted on the certificate of insurance or in the certificate of registration in place of the original owner (since deceased), the motor vehicle cannot be allowed to be used in a public place. Thus, in a case where the owner of a motor vehicle has expired, although there does not exist any statutory interdict for the person in possession of Page 10 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined the vehicle to ply the same on road; but there being a statutory injunction that the same cannot be plied unless a policy of insurance is obtained, we are of the opinion that the contract of insurance would be enforceable. It would be so in a case of this nature as for the purpose of renewal of insurance policy only the premium is to be paid. It is not in dispute that quantum of premium paid for renewal of the policy is in terms of the provisions of the Insurance Act, 1938.
18. The vehicle was hypothecated to a nationalised bank. The certificate of registration, presumably, therefore, carried the name of the bank also. The bank admittedly paid the premium.
19. We, therefore, fail to see any reason as to how the appellant could avoid its statutory liability. Our attention has been drawn to Section 155 of the Motor Vehicles Act by Mr Mehra to contend that the statutory liability of the insurance company arises only when the original contract of insurance was entered into by and between the owner and the insurer and not in a case of this nature.
20. Section 155 of the Act, in our opinion, cannot be said to have any application in a situation of this nature. We may notice the provisions of Section 157 of the Act in terms whereof in a case of transfer of a motor vehicle, the certificate of insurance and the policy shall be deemed to have been transferred in favour of the person to whom the motor vehicle is transferred with effect from the date of its transfer."
14. Insofar as income of the deceased is concerned, the learned Tribunal assessed Rs.2200/- as monthly income of the deceased. On perusal of the cross-examination of PW 1 widow of the deceased, it appears that suggestion was put in the cross- examination that the deceased being a labourer was earning Rs.3000/- per month and said suggestion has been accepted by Page 11 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined the widow of the deceased. In view of such, assessing of Rs.2200/- by the learned Tribunal as monthly income of the deceased is erroneous error on the part of the learned Tribunal and it ought to have been taken at Rs.3000/- and accordingly, it is fixed.
15. The learned Tribunal has erred by not considering the father of the deceased as dependent being his age 58 years and has deducted 1/3rd of the income towards personal expenses, while looking to the number of four dependents, it should be 1/4th.
16. In view of school leaving certificate at Exh.33, the deceased was 28 years old at the time of road accident and therefore, 40% towards loss of future prospect is required to be fixed.
16.1 Therefore, total compensation would be as under, which the claimants/s is/are entitled to get.
Particulars Amount (Rs.)
Future dependency Loss 6,42,600/-
Loss of Estate, consortium & funeral 2,29,900/-
expenses
Total... 8,72,500/-
Less: compensation already awarded 4,88,880/-
Additional amount already awarded 3,83,620/-
17. Therefore, I hold that the claimantss are entitled to get the enhanced compensation of Rs.3,83,620/- with 7.5% p.a. Page 12 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025 NEUTRAL CITATION C/FA/3653/2018 ORDER DATED: 12/02/2025 undefined interest from the date of filing the claim petition till its realisation, which would meet the ends of justice.
18. For the reasons recorded above, the following order is passed.
18.1 The present appeal is partly allowed. The finding of the learned Tribunal exonerating the United India Insurance Company Limited from liability to pay compensation is hereby quashed and set aside.
18.2 The Insurance Company is now directed to deposit the entire decretal amount with interest as stated herein above within a period of six weeks from the date of receipt of this order.
18.3 The Tribunal shall disburse the entire awarded amount lying in the FDR and/or with the Tribunal, with accrued interest thereon, if any, to the claimants, by account payee cheque / NEFT / RTGS, after proper verification and after following due procedure.
18.4 While making the payment, the Tribunal shall deduct the courts fees, if not paid, in accordance with rules/law.
18.5 Rest of the direction(s) of the Tribunal remain same.
18.6 Record and proceedings be sent back to the concerned Tribunal, forthwith.
(J. C. DOSHI,J) SHEKHAR P. BARVE Page 13 of 13 Uploaded by SHEKHAR P. BARVE(HC00200) on Fri Feb 14 2025 Downloaded on : Sat Feb 15 02:45:27 IST 2025