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Iffco Tokio General Insurance Co. Ltd., Vs. Shri. Venkatesh S/O Giriyappa - Court Judgment

LegalCrystal Citation
CourtKarnataka Dharwad High Court
Decided On
Case NumberMFA 21473/2011
Judge
AppellantIffco Tokio General Insurance Co. Ltd.,
RespondentShri. Venkatesh S/O Giriyappa
Excerpt:
1 rr in the high court of karnataka dharwad bench dated this the16h day of september, 2016 before the hon’ble mrs.justice s.sujatha m.f.a.no.21473/2011 c/w. m.f.a.crob.no.100116/2014, m.f.a.no.21474/2011, m.f.a.crob.no.100117/2014 & m.f.a.no.21475/2011 [mv]. in m.f.a. no.21473/2011: between: iffco tokio general insurance company ltd., by its manager, raghavakrishna complex, k.c. road, bellary, rep. herein by iffco tokio general insurance company ltd., customer service centre, kscmf building, iii floor, iii block, #8, cunningham road, bangalore, rep. by its authorized signatory. ...appellant (by sri ravindra r. mane, adv.) and:1. 2. sri venkatesh, s/o giriyappa, age:31. years, occ: coolie. smt.neelamma, w/o venkatesh, age:26. years, occ: coolie. 2 3.4. (both are r/o halekote village,.....
Judgment:

1 RR IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH DATED THIS THE16H DAY OF SEPTEMBER, 2016 BEFORE THE HON’BLE MRS.JUSTICE S.SUJATHA M.F.A.NO.21473/2011 C/w. M.F.A.CROB.NO.100116/2014, M.F.A.NO.21474/2011, M.F.A.CROB.NO.100117/2014 & M.F.A.NO.21475/2011 [MV]. IN M.F.A. No.21473/2011: BETWEEN: Iffco Tokio General Insurance Company Ltd., By its Manager, Raghavakrishna Complex, K.C. Road, Bellary, Rep. herein by Iffco Tokio General Insurance Company Ltd., Customer Service Centre, KSCMF Building, III Floor, III Block, #8, Cunningham Road, Bangalore, Rep. by its authorized signatory. ...APPELLANT (By Sri Ravindra R. Mane, Adv.) AND:

1.

2. Sri Venkatesh, S/o Giriyappa, Age:

31. years, Occ: Coolie. Smt.Neelamma, W/o Venkatesh, Age:

26. years, Occ: Coolie. 2 3.

4. (Both are r/o Halekote Village, Siruguppa Taluk, Bellary District) Sri Shivaraj, S/o Sanna Ramana, Age: Major, Occ: Driver of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.EROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. Sri Mallikarjuna S/o Kallappa, Age Major, Occ: Owner of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.EROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. …RESPONDENTS (By Sri Y.Lakshmikant Reddy, Adv. for R-1 & 2; R3 & R4 - Served) * * * This MFA filed under Section 173(1) of M.V.Act 1988, against the judgment and award dated 30.10.2010 passed in M.V.C.No.548/2010 on the file of the Motor Accident Claims Tribunal – IX, Bellary, awarding the compensation of Rs.1,50,000/- with interest at the rate of 6% p.a. from the date of petition till the date of receipt. IN M.F.A.Crob.No.100116/2014 IN M.F.A.No.21473/2011: BETWEEN :

1. Sri Venkatesh, S/o Giriyappa, Age:

34. years, 3 Occ: Coolie, R/o Halekote Village, Siruguppa Taluk, Bellary District. Smt.Neelamma, W/o Venkatesh, Age:

29. years, Occ: Coolie, R/o Halekote Village, Siruguppa Taluk, Bellary District. ...CROSS OBJECTORS (By Sri Y.Lakshmikant Reddy, Adv.) Sri Shivaraj, S/o Sanna Ramana, Hindu-Major, Driver of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.ERROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. Sri Mallikarjuna S/o Kallappa, Hindu-Major, Owner of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.ERROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. M/s Iffco Tokio General Insurance Company Ltd., By its Manager, Raghavakrishna Complex, K.C. Road, Bellary, (Policy No.70855745 valid from 19.10.2009 to 18.10.2010) …RESPONDENTS2 AND :

1.

2.

3. (By Sri R.R.Mane, Adv. for R-3; R1 & R2 - Served) 4 * * * This MFA Crob. in M.F.A.No.21473/2011 filed under Order 41 Rule 22 of CPC r/w 173(1) of M.V.Act 1988, against the Judgment and Award dated 30.10.2010 passed in M.V.C.No.548/2010 on the file of the Member Motor Accident Claims Tribunal – IX, Bellary, partly allowing the claim petition for compensation and seeking enhancement of compensation. IN M.F.A.No.21474/2011: BETWEEN : Iffco Tokio General Insurance Company Ltd., By its Manager, Raghavakrishna Complex, K.C. Road, Bellary, Rep. herein by Iffco Tokio General Insurance Company Ltd., Customer Service Centre, KSCMF Building, III Floor, III Block, #8, Cunningham Road, Bangalore, Rep. by its authorized signatory. ...APPELLANT AND : (By Sri R.R.Mane, Adv.) 1. Minor Shanthamma, D/o Mukayya @ Gangadhar, Age:

11. years, Occ: Student, Since minor rep. by her father and natural guardian Sri Mukayya @ Gangadhar, S/o Gangadharappa, Age:

31. years, Occ: Coolie, R/o Halekote Village, Siruguppa Taluk, Bellary District.

2. Sri Shivaraj, S/o Sanna Ramana, Age: Major, Occ: Driver of the Tractor Bearing 5 Temporary Reg.KA-36/T-2269 (Engine No.EROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District.

3. Sri Mallikarjuna S/o Kallappa, Age: Major, Occ: Owner of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.EROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. ... RESPONDENTS (By Sri Y.Lakshmikant Reddy, Adv. for R-1.) * * * This MFA filed under Section 173(1) of M.V.Act 1988, against the judgment and award dated 30.10.2010 passed in M.V.C.No.549/2010 on the file of the Motor Accident Claims Tribunal – IX, Bellary, awarding the compensation of Rs.63,000/- with interest at the rate of 6% p.a. from the date of petition till the date of receipt. IN M.F.A.Crob.No.100117/2014 IN M.F.A.No.21474/2011: BETWEEN : Minor Shanthamma, D/o Mukayya @ Gangadhar, Aged about 14 years, Occ: Student, Since minor rep. by her father and natural guardian Sri Mukayya @ Gangadhar, S/o Gangadharappa, Aged about 34 years, Occ: Coolie, 6 R/o Halekote Village, Siruguppa Taluk, Bellary District. ...CROSS OBJECTOR (By Sri Y.Lakshmikant Reddy, Adv.) AND :

1.

2.

3. Sri Shivaraj, S/o Sanna Ramana, Hindu-Major, Driver of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.ERROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. Sri Mallikarjuna S/o Kallappa, Hindu-Major, Owner of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.ERROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. M/s. Iffco Tokio General Insurance Company Ltd., By its Manager, Raghavakrishna Complex, K.C. Road, Bellary, (Policy No.70855745 valid from 19.10.2009 to 18.10.2010) …RESPONDENTS (By Sri R.R.Mane, Adv. for R-3; R1 & R2 - Served) * * * This MFA Crob. in M.F.A.No.21474/2011 filed under Order 41 Rule 22 of CPC r/w 173(1) of M.V. Act 1988, against the judgment and award dated 30.10.2010 passed in M.V.C.No.549/2010 on the file of the Member Motor Accident Claims Tribunal – IX, Bellary, partly allowing the claim petition for compensation and seeking enhancement of compensation. 7 IN M.F.A.No.21475/2011: BETWEEN: Iffco Tokio General Insurance Company Ltd., By its Manager, Raghavakrishna Complex, K.C. Road, Bellary, Rep. herein by IFFCO Tokio General Insurance Company Ltd., Customer Service Centre, KSCMF Building, III Floor, III Block, #8, Cunningham Road, Bangalore, Rep. by its authorized signatory. ...APPELLANT AND: (By Sri Ravindra R. Mane, Adv.) 1.

2.

3. Smt.Neelamma, W/o Venkatesh, Age:

26. years, Occ: Coolie, R/o Halekote Village, Siruguppa Taluk, Bellary District. Sri Shivaraj, S/o Sanna Ramana, Age: Major, Occ: Driver of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.EROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, Manvi Taluk, Raichur District. Sri Mallikarjuna S/o Kallappa, Age: Major, Occ: Owner of the Tractor Bearing Temporary Reg.KA-36/T-2269 (Engine No.EROW-1002 & Chassis No.FROW1002 R/o Uthakanur Village, 8 Manvi Taluk, Raichur District. …RESPONDENTS (By Sri Y.Lakshmikant Reddy, Adv. for R-1; R2 & R3 - Served) * * * This MFA filed under Section 173(1) of M.V.Act 1988, against the judgment and award dated 30.10.2010 passed in M.V.C.No.550/2010 on the file of the Motor Accident Claims Tribunal – IX, Bellary, awarding the compensation of Rs.5,000/- with interest at the rate of 6% p.a. from the date of petition till the date of deposit. These appeals along with Cross objections, having been reserved for orders on 9.8.2016 and posted for further hearing on 14.09.2016, coming on for pronouncement, this day, the Court delivered the following:

JUDGMENT

Appeals are filed by the Insurer challenging the Judgment and Order passed by the Motor Accident Claims Tribunal, Bellary [‘Tribunal’, for short]., in MVC Nos.548-550/2010. Cross Objections are filed by the claimants seeking enhancement of the compensation.

2. Since these appeals arise from the same accident and against the common Judgment, all the matters are heard together and disposed of by this common Judgment. 9 IN MFA No.21473/2011 connected with MFA.CROB.100116/2014:

3. Briefly stated the facts are: that the respondents 1 and 2 – parents of the deceased Mariyamma @ Maremma instituted a claim petition alleging that on 16.1.2010, when the deceased along with the appellant No.2 and others was standing on the proper side of the road, the respondent No.1 being driver of the tractor bearing temporary registration No.KA36T2269[offending vehicle]. drove the same in a high speed with rash and negligent manner and dashed against the deceased, resulting in the death of said Mariyamma @ Maremma who was aged about four years. The Insurer resisted the claim. The Tribunal, after appreciating the evidence on record, awarded the total compensation of Rs.1,50,000/- with interest at 6% per annum from the date of petition till realization. Being aggrieved, the Insurer is before this Court 10 challenging the impugned Judgment on two folds. firstly, on liability whereby it is contended that seven years old boy by name Balaji was at the steering wheel of the offending vehicle; that the driver-respondent No.3 had parked the offending vehicle and had left the place without removing its ignition key; that the said minor boy while playing entered into the offending vehicle and started the vehicle as a result, the vehicle moved further and dashed to the pedestrians which resulted in violation of a specified condition of the policy in regard to driving of the vehicle by not duly authorized driver and hence the appellant was not liable to indemnify the respondent No.2 – owner in respect of any claim arising out of the said accident. Secondly, on quantum, learned Counsel placing reliance on the Judgment of the Apex Court in the case of RESHMA KUMARI & OTHERS v. MADAN MOHAN & ANOTHER reported in 2013 ACJ1253would contend that the compensation awarded by the Tribunal at Rs.1,50,000/- for the death 11 of the minor, aged about four is not in conformity with the Judgment of the Apex Court in RESHMA KUMARI’s case [supra].. In support of his contention, learned Counsel placed reliance on the following Judgments: [a]. UNITED INDIA INSURANCE CO. LTD. v. RAKESH KUMAR ARORA AND OTHERS reported in 2009 (1) T.A.C. 364 (S.C.) [b]. UNITED INDIA INSURANCE CO. LTD. THROUGH ITS DIVISIONAL MANAGER v. SUJATA ARORA AND OTHERS reported in 2013 (3) T.A.C. 29 (SC). [c]. THE BRANCH MANAGER, THE ORIENTAL INSURANCE CO., LTD., v. SMT. KASHIBAI AND OTHERS in MFA No.30987/2013 [DD-18.4.2016]. 12 [d]. RESHMA KUMARI & OTHERS v. MADAN MOHAN & ANOTHER reported in 2013 ACJ1253[e]. THE NEW INDIA ASSURANCE COMPANY LIMITED v. SMT. SUNANDA AND OTHERS in MFA No.23071/2012 [DD – 22.1.2013]. [f]. KAUSHLYA DEVI v. SHRI KARAN ARORA AND OTHERS reported in CDJ2007SC596[g]. SOMASHEKAR CHIDANAND BADIGER AND OTHERS v. CHIEF EXECUTIVE ENGINEER AND OTHERS in W.P. No.67159/2010 [DD – 20.2.2015].

4. Per contra, learned Counsel appearing for the claimants justifying the impugned Judgment and Award would contend that the owner had engaged a duly licenced person as driver and handed over the offending vehicle in his charge. Any default committed by the said duly licenced driver in leaving ignition key in 13 the offending vehicle, whereby the minor child without knowledge or consent of the owner had driven the offending vehicle not amount to breach of insurance policy. The Insurer is liable to indemnify the owner.

5. However, learned Counsel submits that the compensation awarded by the Tribunal is on the lower side and in identical cases involving death of a minor child, the Hon’ble Supreme Court as well as this Court has awarded total compensation of Rs.5 lakhs which is a guiding factor to be made applicable for the present case in awarding the compensation. In support of his contentions, learned Counsel placed reliance on the following Judgments: [a]. SOHAN LAL PASSI v. P.SESH REDDY & OTHERS reported in 1996 ACJ104414 [b]. SAGAR (DECEASED) by L.R.s v. SURESH AND OTHERS reported in [2014 Kant. M.A.C. 506 (Kant)]. [c]. JINNAPPA AND ANOTHER v. JAIPAL SURAPPA NANDREKAR AND ANOTHER in MFA No.102939/2015 [DD-16.6.2016].

6. Heard the submissions of the parties and perused the material on record. To appreciate the rival submissions of the parties, it is apt to refer to the Exhibit.P1 – complaint which clearly discloses that the complainant was one of the victim of the said accident; that the driver of the tractor/offending vehicle had parked the vehicle with the ignition key in the vehicle. By that time, a minor boy Balaji, aged about 7 had started the vehicle which caused the accident resulting in the death of the daughter of the complainant besides causing injury to other two persons. Exhibit.P2 is the charge sheet filed against the driver of the offending 15 vehicle. Based on this charge sheet, the Tribunal held that the offending vehicle was driven by the driver Shivaraj who possessed valid and effective driving licence and as such there was no breach of terms and conditions of the insurance policy as alleged by the Insurer. However, this finding is in contrast with the material evidence on record, more particularly, Exhibit.P1-Complaint which clearly speaks that the accident occurred due to the negligent act of the driver in leaving the ignition key in the offending vehicle. Considering the material evidence available on record, this Court is of the considered opinion that the offending vehicle was driven by the minor at the time of the accident. Thus, the points that arise for consideration before this Court are: [i]. Whether the Insurer is liable to indemnify the owner when the Insured had engaged a licenced driver and had placed the vehicle in his charge 16 and the said vehicle being driven by a minor without the knowledge or consent of the driver/owner?. [ii]. Whether the claimants are entitled to enhancement of compensation?. Regarding point No.[i].:

7. The Judgment of the Hon’ble Apex Court in the case of RAKESH KUMAR ARORA supra, was held in the context of a minor not holding a valid and effective driving licence, drove the vehicle causing the accident, resulting in death of one person. This Judgment was rendered by a Bench consisting of two Hon’ble Judges decided on 24.09.2008. It was held that Section 4 of the Motor Vehicles Act, 1988 [‘Act’ for short]. prohibits driving of a vehicle by any person under the age of 18 years in a public place. Section 5 of the Act imposes statutory responsibility upon the owners of the motor vehicles not to cause or permit any person who does not 17 satisfy the provisions of Section 3 or 4 of the Act to drive the vehicle.

8. The vehicle therein admittedly was being driven by a minor aged about 15. The Insured owner had not placed the vehicle in the hands of a person holding valid and effective driving licence. On the other hand, the vehicle was driven by a minor. The said case is not applicable to the facts of the present case since the offending vehicle was placed incharge of a person having a valid licence by the Insured. Similarly, in the case of SUJATHA ARORA AND OTHERS supra, it was found that the offending vehicle was driven by the driver who was either holding a licence or a fake licence and as such it was held that it amounts to violation of the terms and conditions of the policy and no liability can be fastened on the insurance company. Hence, the said Judgment is not applicable to the facts of the present case. The Judgment of the Hon’ble Apex Court in the 18 case of SOHANLAL PASSI supra is squarely applicable to the facts of the present case. This Judgment is rendered by the Bench of three Hon’ble Judges decided on 17.7.1996. While interpreting the word ‘breach’, in the context of Section 96[2].[b]. of the Motor Vehicles Act, 1939 [Section 149[2].[a]. of the Act]. it is held that breach means infringement or violation of a promise or obligation. It was a case where the bus driver allowed the conductor/cleaner who was not duly licenced person to drive the bus and he caused the accident. It was contended that accident occurred when an unlicenced person was driving the vehicle, there was a breach of specific condition in the policy and the insurance company cannot be held liable to indemnify the owner. The Hon’ble Apex Court considering the provisions of Section 96[2].[b].[ii]. of the Motor Vehicles Act, 1939 analogous to [Section 149[2].[ii]. of the Act]. vis- à-vis vicarious liability of the owner, held that the owner engaged a duly licenced person as driver and placed the 19 bus in his charge. The driver allowed the conductor/cleaner who was not duly licenced to drive the vehicle and he caused the accident resulting in death of the Scooterist. In that context, it is held thus:

"The defence built on the exclusion clause cannot succeed for three reasons, viz. : (1) On a true interpretation of the relevant clause which interpretation is at peace with the conscience of Section 96, the condition excluding driving by a person not duly licensed is not absolute and the promisor is absolved once it is shown that he has done everything in his power to keep, honour and fulfil the promise and he himself is not guilty of a deliberate breach. (2) Even if it treated as an absolute promise, there is substantial compliance therewith upon an express or implied mandate being given to the licensed driver not to allow the vehicle to be left unattended so that it happens to be driven by an unlicensed driver. 20 (3) The exclusion clause has to be 'read down' in order that it is not at war with the 'main purpose' of the provisions enacted for the protection of victims of accidents so that the promisor is exculpated when he does everything in his power to keep the promise."

To examine the correctness of the aforesaid view this appeal was referred to a three Judges' Bench, because on behalf of the insurance company, a stand was taken that when 'Section 96(2)(b)(ii) has provided that the insurer shall be entitled to defend the action on the ground that there has been breach of a specified condition to the policy i.e. the vehicle should not be driven by a person who is 'not' duly licensed, then the insurance company cannot be held to be liable to indemnify the owner of the vehicle. In other words, once there has been a contravention of the condition prescribed in sub-section (2)(b)(ii) of Section 96, the person insured shall not be entitled to the benefit of sub- section (1) of Section 96. According to us, Section 96(2)(b)(ii) should not be interpreted in 21 a technical manner. Sub-section (2) of Section 96 only enables the insurance company to defend itself in respect of the liability to pay compensation on any of the grounds mentioned in sub-section (2) including that there has been a contravention of the condition excluding the vehicle being driven by any person who is not duly licensed. This bar on face of it operates on the person insured. If the person who has got the vehicle insured has allowed the vehicle to be driven by a person who is not duly licensed then only that clause shall be attracted. In a case where the person who has not insured the vehicle with the insurance company, has appointed a duly licensed driver and if the accident takes place when the vehicle is being driven by a person not duly licensed on the basis of the authority of the driver duly authorised to drive the vehicle whether the insurance company in that event shall be absolved from its liability?. The expression "breach" occurring in Section 96(2)(b) means infringement or violation of a promise or obligation. As such the insurance company 22 will have to establish that the insured was guilty of an infringement or violation of a promise. The insurer has also to satisfy the Tribunal or the Court that such violation or infringement on the part of the insured was willful, It the insured has taken all precautions by appointing a duly licensed driver to drive the vehicle in question and it has not been established that lt was the insured who allowed the vehicle to be driven by a person not duly licensed, then the insurance company cannot repudiate its statutory liability under sub-section (1) of Section 96. In the present case far from establishing that it was the appellant who had allowed Rajinder Pal Singh to drive the vehicle when the accident took place, there is not even any allegation that it was the appellant who was guilty of violating the condition that the vehicle shall not be driven by a person not duly licensed. From the facts of the case, it appears that the appellant had done everything within his power inasmuch as he has engaged a licensed driver Gurubachan Singh and had placed the 23 vehicle in his charge. While interpreting the contract of insurance, the Tribunals and Courts have to be conscious of the fact that right to claim compensation by heirs and legal representatives of the victims of the accident is not defeated on technical grounds. Unless it is established on the materials on record that it was the insured who had willfully violated the condition of the policy by allowing a person not duly licensed to drive the vehicle when the accident took place, the insurer shall be deemed to be a judgment-debtor in respect of the liability in view of sub- section (1) of Section 96 of the Act. It need not be pointed out that the whole concept of getting the Vehicle insured by an insurance company is to provide an easy mode of getting compensation by the claimants, otherwise in normal course they had to pursue their claim against the owner from one forum to the other and ultimately to execute the order of the Accident Claims Tribunal for realization of such amount by sale of properties of the owner of the vehicle. The procedure and 24 result of the execution of the decree is well known.

13. This Court in the case of Kashiram Yadav and Another. v. Oriental Fire and General Insurance Co. and Others, (1989) 4 SCC128reiterated the views expressed in Skandia Insurance Co. Ltd. v. Kokilaben Chandravadan (supra) while referring to that case it was said:

".......There the facts found were quite different. The vehicle concerned in that case was undisputedly entrusted to the driver who had a valid licence. In transit the driver stopped the vehicle and went to fetch some snacks from the opposite shop leaving the engine on. The ignition key was at the ignition lock and not in the cabin of the truck. The driver had asked the cleaner to take care of the truck. In fact the driver had left the truck in care of the cleaner. The cleaner meddled with the vehicle and caused the accident. The question arose whether the insured (owner) had committed a breach of the condition incorporated in the certificate of insurance 25 since the cleaner operated the vehicle on he fatal occasion without driving licence. his Court expressed the view that it is only when the insured himself entrusted the vehicle to a person who does not hold a driving licence, he could be said to have committed breach of the condition of the policy. It must be established by the Insurance Company that the breach is on the part of the insured. Unless the insured is at fault and is guilty of a breach of the condition, the insurer cannot escape from the obligation to indemnify the insured. It was also observed that when the insured has done everything within his power inasmuch as he has engaged the licensed driver and has placed the vehicle in his charge with the express or implied mandate to drive himself, it cannot be said that the insured is guilty of any breach. We affirm and reiterate the statement of law laid down in the above case. We may also state that without the knowledge of the insured, if by driver's acts or omission others meddle with the vehicle and cause an 26 accident, the insurer would be liable to indemnify the insured. The insurer in such a case cannot take the defence of a breach of the condition in the certificate of insurance."

We are in respectful agreement with the view expressed in the case of Skandia Insurance Co. Ltd. vs Kokilaben Chandravadan, 1987 ACJ411SC)(supra).

14. As in the facts of the present case, the appellant shall be deemed to be liable to pay compensation applying the principle of vicarious liability because the accident took place when the act authorised was being performed in a mode which may not be proper but was directly connected with in the course of employment, sub-section (1) of section 96 of the Act shall come into play and the insurance company shall be deemed to be the judgment debtor, so far claim made by the heirs and legal representatives of the deceased is concerned.” 27 9. The Hon’ble Apex Court has reiterated the views expressed in the case of SKANDIA INSURANCE CO. LTD. v. KOKILABEN CHANDRAVADAN reported in 1987 ACJ411wherein similar set of facts were present before the Hon’ble Apex Court. The vehicle concerned was entrusted to the driver who had a valid licence. In transit, the driver stopped the vehicle and went to fetch some snacks. The ignition key was at the ignition lock. The Cleaner meddled with the vehicle and caused the accident. The Hon’ble Court expressed the view that, it is only when the insured himself entrusted the vehicle to a person who does not hold a driving licence, he could be said to have committed breach of the conditions of the policy. In the light of the said Judgments discussed above, this Court is of the considered opinion that the Insured had entrusted the vehicle to a person having a valid and effective driving licence. There was no breach on the part of the insured. 28 Thus, the appellant-insurer shall be liable to pay compensation, indemnifying the owner. Regarding point No.[ii].:

10. The Hon’ble Apex Court in the case of KISHAN GOPAL AND ANOTHER v. LALA AND OTHERS reported in [2014]. 1 SCC244 while considering the death of ten years old child in the motor vehicle accident, awarded an amount of Rs.5 lakhs with interest at 9% per annum [Rs.4,50,000/- towards loss of dependency, Rs.50,000/- under conventional heads].. The Hon’ble Apex Court has referred to the case of LATA WADHWA AND OTHERS v. STATE OF BIHAR AND OTHERS reported in [2001]. 8 SCC197 In LATA WADHWA’s case [supra]., it was observed that in so far as children of age group between 10-15 years are concerned, they were all students of Class VI to X and children of employees of TISCO and having regard to the facts, the contribution of the deceased child was 29 taken at Rs.24,000/- per annum. It was observed that the compensation amount for children between the age group of 5-10 years should be Rs.1,50,000/-, to which the conventional figure of Rs.50,000/- should be added. Considering these aspects, the Hon’ble Apex Court in the case of KISHAN GOPAL [supra]., has held thus: “38. In our considered view, the aforesaid legal principle laid down in Lata Wadhwa's case with all fours is applicable to the facts and circumstances of the case in hand having regard to the fact that the deceased was 10 years' old, who was assisting the appellants in their agricultural occupation which is an undisputed fact. We have also considered the fact that the rupee value has come down drastically from the year 1994, when the notional income of the non- earning member prior to the date of accident was fixed at Rs.15,000/-. Further, the deceased boy, had he been alive would have certainly 30 contributed substantially to the family of the appellants by working hard.

39. In view of the aforesaid reasons, it would be just and reasonable for us to take his notional income at Rs.30,000/- and further taking the young age of the parents, namely the mother who was about 36 years old, at the time of accident, by applying the legal principles laid down in the case of Sarla Verma v. Delhi Transport Corporation, the multiplier of 15 can be applied to the multiplicand. Thus, 30,000 x 15 = 4,50,000 and 50,000/- under conventional heads towards loss of love and affection, funeral expenses, last rites as held in Kerala SRTC v. Susamma Thomas, which is referred to in Lata Wadhwa's case and the said amount under the conventional heads is awarded even in relation to the death of children between 10 to 15 years old. In this case also we award Rs.50,000/- under conventional heads. In our view, for the aforesaid reasons the said amount would be fair, just and 31 reasonable compensation to be awarded in favour of the appellants.” 11. The co-ordinate Bench of this Court in the case of a minor boy aged about six in the case of SAGAR [supra]., following the case of KISHAN GOPAL [supra]., awarded total compensation of Rs.5,95,000/-. Similarly, in JINNAPPA’s case [supra]., for the death of minor child aged about five, following case of KISHAN GOPAL [supra]., awarded total compensation of Rs.5,00,000/-. In the case of SUNANDA [supra]., the Judgment was rendered following the Judgment of the Hon’ble Apex Court in the case of SATENDAR AND OTHERS, a sum of Rs.2,00,000/- was awarded as compensation for the death of five year old girl. Obviously, this Judgment was rendered on 22.01.2013 prior to the Judgment of the Hon’ble Apex Court in the case of KISHAN GOPAL [supra].. The co-ordinate Bench of this Court in the case of ARJUN AND ANOTHER v. 32 KAMALESHWAR AND ANOTHER in MFA No.516/2008 [DD – 13.03.2012]. while considering the case of a minor boy aged about four years, awarded the compensation of Rs.3,75,000/-. Much emphasis is placed on paragraph 40[ii]. of RESHMA KUMARI’s case [supra]. by the learned Counsel for the Appellant.

12. A two Judge Bench of the Hon’ble Apex court while hearing the appeals on two common questions, namely, [i]. Whether multiplier specified in II-Schedule appended to the Act should be scrupulously applied in all cases?. and, [ii]. Whether for determination of the Multiplicand, the 1988 Act provides for any criterion, particularly, as regards the determination of future prospects?. the Hon’ble Bench was of the opinion that the question, whether the multiplier specified in the II-Schedule 33 should be taken as a guiding factor for calculation of the amount of compensation payable in a case falling under Section 166 of the Act, needed to be decided by a larger Bench. Thus, the said issue was referred to the larger Bench. The referral order reads thus: “39. We have noticed hereinbefore that in Patricia Jean Mahajan (supra) and Abati Bezbaruah (supra) and the other cases following them multiplier specified in the Second Schedule has been taken to be guiding factor for calculation of the amount of compensation even in a case under Section 166 of the Act. However, in Shanti Pathak (supra) this Court advocated application of lesser multiplier, although no legal principle has been laid therein.

40. In Trilok Chandra (supra) this Court has pointed out certain purported calculation mistakes in the Second Schedule. It, however, appears to us that there is no mistake therein. 34 Amount of compensation specified in the Second Schedule only is required to be paid even if a higher or lower amount can be said to be the quantum of compensation upon applying the multiplier system.

41. Section 163-A of the 1988 Act does not speak of application of any multiplier. Even the Second Schedule, so far as the same applies to fatal accident, does not say so. The multiplier, in terms of the Second Schedule, is required to be applied in a case of disability in nonfatal accident. Consideration for payment of compensation in the case of death in a “no fault liability” case vis-à-vis the amount of compensation payable in a case of permanent total disability and permanent partial disability in terms of the Second Schedule is to be applied by different norms. Whereas in the case of fatal accident the amount specified in the Second Schedule depending upon the age and income of the deceased is required to be paid where for the multiplier is not to be applied at all but in a case involving permanent total disability or 35 permanent partial disability the amount of compensation payable is required to be arrived at by multiplying the annual loss of income by the multiplier applicable to the age of the injured as on the date of determining the compensation and in the case of permanent partial disablement such percentage of compensation which would have been payable in the case of permanent total disablement as specified under item (a) of the Second Schedule.

42. The Parliament in its wisdom thought to provide for a higher amount of compensation in case of permanent total disablement and proportionate amount of compensation in case of permanent partial disablement depending upon the percentage of disability.

43. Thus, prima facie, it appears that the multiplier mentioned in the Second Schedule, although in a given case, may be taken to be a guide but the same is not decisive. To our mind, although a probable amount of compensation as specified in the Second Schedule in the event the age of victim is 17 36 or 20 years and his annual income is Rs.40,000/-, his heirs/legal representatives is to receive a sum of Rs.7,60,000/-, however, if an application for grant of compensation is filed in terms of Section 166 of the 1988 Act that much amount may not be paid, although in the former case the amount of compensation is to be determined on the basis of ‘no fault liability’ and in the later on ‘fault liability’. In the aforementioned situation the Courts, we opine, are required to lay down certain principles.

44. We are not unmindful of the Statement of Objects and Reasons to Act 54 of 1994 for introducing Section 163-A so as to provide for a new predetermined formula for payment of compensation to road accident victims on the basis of age/income; which is more liberal and rational. That may be so, but it defies logic as to why in a similar situation, the injured claimant or his heirs/legal representatives, in the case of death, on proof of negligence on the part of the driver of a motor vehicle would get a lesser amount than 37 the one specified in the Second Schedule. The Courts, in our opinion, should also bear that factor in mind.

45. Having regard to divergence of opinion and this aspect of the matter having not been considered in the earlier decisions, particularly in the absence of any clarification from the Parliament despite the recommendations made by this Court in Trilok Chandra (supra), the issue, in our opinion, shall be decided by a Larger Bench. It is directed accordingly.” While considering the said reference, the Hon’ble Apex Court held as under:

40. i) “In the applications for compensation made under Section 166 of the 1988 Act in death cases where the age of the deceased is 15 years and above, the Claims Tribunals shall select the multiplier as indicated in Column (4) of the table prepared in Sarla Verma, 2009 ACJ1298read with para 21 of that judgment. 38 (ii) In cases where the age of the deceased is upto 15 years, irrespective of the Section 166 or Section 163A under which the claim for compensation has been made, multiplier of 15 and the assessment as indicated in the Second Schedule subject to correction as pointed out in Column (6) of the table in Sarla Verma (supra) should be followed.” This Judgment was rendered while answering the referral order as stated supra, with reference to selecting multiplier whereas in LATA WADHWA’s case [supra]., the Hon’ble Apex Court while determining the notional income for compensation to those who had no income prior to the accident, examined the tortuous liability of the tortfeasor and arrived at the criteria for awarding compensation for the death of children in accidents between the age group of 5-10 years and for the children between age group of 10-15 years. In 39 paragraph-11 of LATA WADHWA’s case [supra]., it is held thus: “11. So far as the award of compensation in case of children are concerned, Shri Justice Chandrachud, has divided them into two groups, first group between the age group of 5 to 10 years and the second group between the age group of 10 to 15 years. In case of children between the age group of 5 to 10 years, a uniform sum of Rs.50,000/- has been held to be payable by way of compensation, to which the conventional figure of Rs.25,000/- has been added and as such to the heirs of the 14 children, a consolidated sum of Rs.75,000/- each, has been awarded. So far as the children in the age group of 10 to 15 years, there are 10 such children, who died on the fateful day and having found their contribution to the family at Rs.12,000/- per annum, 11 multiplier has been applied, particularly, depending upon the age of the father and then the conventional compensation of Rs.25,000/- has been added to each case 40 and consequently, the heirs of each of the deceased above 10 years of age, have been granted compensation to the tune of Rs.1,57,000/- each. In case of the death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child's life- time. But this will not necessarily bar the parents claim and prospective loss will found a valid claim provided that the parents establish that they had a reasonable expectation of pecuniary benefit if the child had lived. This principle was laid down by the House of Lords in the famous case of Taff Vale Ry. Vs. Jenkins [1913]. A.C.1, and Lord Atkinson said thus: ........all that is necessary is that a reasonable expectation of pecuniary benefit should be entertained by the person who sues. It is quite true that the existence of this expectation is an inference of fact there must be a basis of fact from which the inference can reasonably be drawn; but I wish to express my emphatic dissent from the 41 proposition that it is necessary that two of the facts without which the inference cannot be drawn are, first, that the deceased earned money in the past, and, second, that he or she contributed to the support of the plaintiff. These are, no doubt, pregnant pieces of evidence, but they are only pieces of evidence; and the necessary inference can I think be drawn from circumstances other than and different from them. At the same time, it must be held that a mere speculative possibility of benefit is not sufficient. Question whether there exists a reasonable expectation of pecuniary advantage is always a mixed question of fact and law. There are several decided cases on this point, providing the guidelines for determination of compensation in such cases but we do not think it necessary for us to advert, as the claimants had not adduced any materials on the reasonable expectation of pecuniary benefits, which the parents expected. In case of a bright and healthy 42 boy, his performances in the school, it would be easier for the authority to arrive at the compensation amount, which may be different from another sickly, unhealthy, rickety child and bad student, but as has been stated earlier, not an iota of material was produced before Shri Justice Chandrachud to enable him to arrive at just compensation in such cases and, therefore, he has determined the same on an approximation. Mr. Nariman, appearing for the TISCO on his own, submitted that the compensation determined for the children of all age groups could be doubled, as in his views also, the determination made is grossly inadequate. Loss of a child to the parents is irrecoupable, and no amount of money could compensate the parents. Having regard to the environment from which these children were brought, their parents being reasonably well placed officials of the Tata Iron and Steel Company, and on considering the submission of Mr. Nariman, we would direct that the compensation amount for the children between the age group of 5 to 10 years 43 should be three times. In other words, it should be Rs.1.5 lakhs, to which the conventional figure of Rs.50,000/- should be added and thus the total amount in each case would be Rs. 2.00 lakhs. So far as the children between the age group of 10 to 15 years, they are all students of Class VI to Class X and are children of employees of TISCO. The TISCO itself has a tradition that every employee can get one of his child employed in the company. Having regard to these facts, in their case, the contribution of Rs.12,000/- per annum appear to us to be on the lower side and in our considered opinion, the contribution should be Rs.24,000/- and instead of 11 multiplier, the appropriate multiplier would be 15. Therefore, the compensation, so calculated on the aforesaid basis should be worked out to Rs. 3.60 lakhs, to which an additional sum of Rs.50,000/- has to be added, thus making the total amount payable at Rs.4.10 lakhs for each of the claimants of the aforesaid deceased children.” 44 In KISHAN GOPAL’s case [supra]., the Hon’ble Apex Court while considering the case of death of a minor boy aged about 10 years, placed reliance on the Judgment of Lata Wadhwa’s case. As aforesaid, Lata Wadhwa’s case dealt with the children between the age group of 5 to 15 years which was divided into two groups, the one group between the age group of 5 to 10 years and the other group between the age group of 10-15 years. Admittedly, the deceased was aged about four at the time of the accident in the present case. It is hard to assess the academic performance of the child below five years and the reasonable expectation of pecuniary advantages, normally where the child is not even admitted to the school at that tender age, expectation of any pecuniary advantage of a child below five years would be a mere speculation or imagination. Thus, applying the principles of law enunciated by the Hon’ble Apex Court as discussed above, the assessment has to be made as per II-Schedule taking notional income at 45 Rs.15,000/- per annum employing the multiplier of 15. The loss of dependency works out to Rs.2,25,000/-. The claimant shall be entitled to non pecuniary damages of Rs.75,000/- and Rs.75,000/- towards future prospects as awarded by the co-ordinate Bench of this Court in MFA No.516/2008 supra. The appellant shall be entitled to total compensation of Rs.3,75,000/- with interest at 6% per annum from the date of the petition till realization. IN MFA No.21474/2011 connected with MFA.CROB.100117/2014:

13. The Respondent No.1 in this appeal instituted a claim petition in respect of injuries sustained by her. The Tribunal, after appreciating the evidence on record, awarded the total compensation of Rs.63,000/- with interest at 6% per annum from the date of petition till realization. Being aggrieved, the 46 Insurer as well as claimant is before this Court challenging the impugned Judgment.

14. Considering the nature of injuries sustained by the claimant and the totality of circumstances of the case, this Court is of the considered opinion that the ends of justice would be met by enhancing the compensation awarded by the Tribunal to Rs.70,000/- as against Rs.63,000/- awarded. Thus, the appeal filed by the Insurer challenging the liability is dismissed for the reasons aforesaid in the preceding paragraphs. The Cross objections filed by the claimant is allowed to the extent indicated above. IN MFA No.21475/2011:

15. The Respondent No.1 in this appeal instituted a claim petition in respect of injuries sustained by her. The Tribunal, after appreciating the evidence on record, awarded the total compensation of Rs.5,000/- with interest at 6% per annum from the date 47 of petition till realization. Being aggrieved, the Insurer is before this Court challenging the impugned Judgment on liability. On the factum of liability challenged by the Insurer, the appeal stands dismissed for the reasons discussed above.

16. In the result, all the appeals and Cross objections are disposed of in terms of above. The amount in deposit shall be transferred to the jurisdictional Tribunal for disbursement. Sd/- JUDGE AN/-


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