Gujarat High Court Case Information System
Print
FA/257/2010 19/ 19 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 257 of 2010
With
CIVIL
APPLICATION No. 1560 of 2010
In
FIRST APPEAL No. 257 of 2010
=========================================================
NATIONAL
INSURANCE CO. LTD REG.OFFICE AT 3RD FLOOR - Appellant(s)
Versus
CHHEDILAL
RAMFAL VARMA & 7 - Defendant(s)
=========================================================
Appearance
:
MR
SUNIL B PARIKH for
Appellant(s) : 1,
None for Defendant(s) : 1 -
8.
=========================================================
CORAM
:
HONOURABLE
MR.JUSTICE H.K.RATHOD
Date
: 11/02/2010
ORAL
ORDER
Heard
learned advocate Mr. Sunil B. Parikh appearing on behalf of appellant
insurance company.
The
appellant has challenged amount of Rs.1,50,000/- in present appeal.
The appellant has challenged award passed by MACT, Nadiad in MACP
No.193 of 2005 decided on 31st
January 2009 Ex.48. The claims tribunal has awarded Rs.3,06,900/-
with 9% interest in favour of claimant. The claimants have filed
application under Sec.163A of MV Act.
The
accident occurred on 14th
March 2005. The deceased Kashiram Varma was proceeding from Umreth
towards Dakor on scooter bearing registration No.GJ-7-Q-1647
of ownership of opponent No.1 as a pillion rider and the said scooter
was being driven by
opponent No.1 in slow speed on correct side of road. When they
reached near the Sim of village Umreth Crossing No.27, at that time,
opponent No.5 came in excessive speed with vehicle bearing Truck
No.GJ-7-Z-9095, dashed with scooter. As a result, scooter dashed with
truck bearing No.GJ-7-X-7821 coming from opposite direction. As a
result, he sustained serious injuries and due to injuries, he died on
the spot. Total claim was made for Rs.4,65,500/-. Opponent Nos.1, 3,
4, 6 and 7, though served, but not appeared and represented before
claims tribunal. Learned advocate for insurance company was appeared
and filed reply at Ex.23 and Ex.41 denying averments made in claim
petition. The claims tribunal has considered the object of Section
163A of MV Act in paragraphs 5 and 6, which are quoted as under :
5. It
is settled proposition of law that the application U/s.163-A of MV
Act is substantive application and award passed on the basis of such
application is final, Sub-section-2 of Section 163-A of the MV Act
provides that in any claim for compensation under Sub-section-1, the
claimants shall not be required to plead or establish that death or
permanent disability in respect of which the claim has been made was
due to any wrongful act or negligent or default of the driver of the
vehicle.
6. It
is also a settled proposition of law that once the motor vehicle
involved in the accident is insured for the relevant period, the
Insurance Company cannot be exonerated from the liability to pay
compensation to the claimants merely on the ground of breach of any
terms and conditions of the Insurance Policy by the insured. If at
all, there is any breach of any terms and condition of the Insurance
Policy by the insured, at the most, the Insurance Company may be
entitled to recover the amount from the insured, but the Insurance
Company is liable to pay compensation to the claimants (vide United
India Insurance Company vs. Lehru 2003) SCC 338 = 2003 (2) GLH 256
(para 15 & 17), New India Assurance Co. Ltd. Vs. Kamla, AIR 2001
SC 1419 = 2001(4) SCC 3421 (para 22) and New India Assurance Co. Ltd.
Vs. Rula AIR 2000 SC 1082 = 2003(3) SCC 195 (para 12 & 13).
The
claimant has produced certain documents as referred in paragraph 7
which are quoted as under :
7. In
support of the claim petition, the claimants have place reliance on
the following documents produced at list Exh.6, 24, 36 and 45 :
Copy
of complaint mark 6/1
Copy
of panchnama mark 6/2
Copy
of inquest panchnama mark 6/3
Copy
of R.C. Book of scooter bearing No.GJ-7-Q-1647 mark 6/4
Copy
of insurance policy of scooter mark 6/5
Copy
of R.C. Book of truck No.GJ-7-X-7821 mark 6/6
Copy
of insurance policy of truck No.GJ-7-X-7821 mark 6/7
Copy
of R.C. Book of truck No.GJ-7-Z-9095 mark 6/8
Copy
of insurance policy of truck No.GJ-7-Z-9095 mark 6/9
Copy
of post mortem note of deceased Kashiram mark 24/1
Copy
of chargesheet mark 24/2
Salary
certificate of deceased mark 24/3 36/1
Certified
copy of judgment delivered in M.A.C.P. Case No.141/2005 mark 45/1
The
age of deceased Kashiram as per affidavit Ex.25 was 29 years and as
per postmortem note at mark 24/1, was aged about 30 years. The
deceased was doing work of Plaster of Paris and monthly getting
Rs.3,000/-. In support of that one Ram Ujagar Varma has stated on
affidavit Ex.37 that he is residing at Vidhyanagar
and doing work of Plaster of Paris, etc., with the help of labourer.
According to his evidence Ex.37, deceased was doing work of Plaster
of Paris and
he was getting Rs.100/- daily wage and one certificate also produced
on record at Mark 4/3. Therefore, claims tribunal has assessed income
Rs.2,100/- monthly and 1/3rd
has been deducted as per second schedule and 18 multiplier has been
applied, accordingly, it comes to Rs.3,02,400/- being a family
dependency loss, then, Rs.2,500/- being a loss of estate and
Rs.2,000/- being a funeral charges awarded.
Learned
advocate Mr. Parikh relied upon two decisions of Apex Court and
pointed out that deceased was unmarried, therefore, age of claimant
is to be considered and proper multiplier is 8 and Rs.1,400/-
dependency is on higher side. He relied upon decision of Division
Bench of this Court reported in 23(1) GLR 785 and 26(2) GLR 1315. He
also relied upon decision of Apex Court reported in 1999 ACJ 1400. In
such cases, dependency comes to 1/3rd
not 2/3rd
as decided by Apex Court. Therefore, according to his submission that
because deceased was unmarried, 1/3rd
dependency is available to claimant, 18 multiplier is on higher side,
because, age of deceased is not to be considered while applying
multiplier, but, age of claimant is to be considered. He relied upon
recent decision of Apex Court in case of Reshmakumari v. Madanmohan
reported in 2009 AIR SCW 6909 and National Insurance Co. Ltd. v.
Gurumallama reported in 2009 AIR
SCW 7434. He submitted that in case of Reshmakumari, Apex Court has
referred the matter to larger Bench while deciding 166 application,
whether second
schedule is made applicable or not. The identical question has been
examined by this Court in First Appeal No.101 of 2010 on 29th
January 2010 in case of ICICI Lombard General Insurance Com. Ltd. v.
Kanji Bachubhai Ayar and others, where similar question has been
decided elaborately discussed the similar question raised before this
Court by learned advocate Mr. Vibhuti Nanavati who was appearing on
behalf of insurance company, who relied upon both decisions which
have been relied upon by learned advocate Mr. Parikh. The relevant
discussion is made in aforesaid First Appeal in paragraphs 4 to 8,
which are quoted as under :
4.0 Relying
upon aforesaid two decisions, learned Advocate Mr. Nanavati raised
contention that the Claims Tribunal has considered Rs.3,000/- as
monthly income of the deceased, which yearly comes to Rs.36,000/- and
considering age of the deceased 19 years, multiplier of 16 has been
applied. Accordingly, the Claims Tribunal has committed gross error
in relying upon annual income of Rs.36,000/- and considered
Rs.6,84,000/- being amount of compensation and after deduction of
1/3rd amount, which comes to Rs.4,60,500/-, as awarded by
the Claims Tribunal. The total amount of compensation available as
per Second Schedule to the claimant when yearly income of the
deceased comes to Rs.36,000/- then it comes to Rs.6,84,000/- after
deducting 1/3rd amount Rs.2,28,000/- remaining amount
comes to Rs.4,56,000/- and Rs.2,000/- has been awarded towards
Funeral Expenses and Rs.2,500/- has been awarded towards Loss of
Estate. The total amount comes to Rs.4,60,500/-. But, learned
Advocate Mr. Nanavati submitted that such calculation is not correct
and Second Schedule has been found by the Honourable Apex Court
erroneous. Therefore, according to his calculation from Rs.3,000/-
monthly income if 1/3rd is deducted then it comes to
Rs.2,000/- and yearly income comes to Rs.24,000/- and then applying a
multiplier of 16 at an age of 19 years, it comes to Rs.3,84,000/-
towards Loss of Dependency and thereafter, Rs.2,500/- towards Loss of
Estate and Rs.2,000/- towards Funeral Expenses, in all comes to
Rs.3,88,500/- and not Rs.4,60,500/-. Therefore, there is an excess
of Rs.72,000/- awarded by the Claims Tribunal, which found apparently
a calculation error while considering Second Schedule r/w. Section
163A of the Act. Except this, no other submission has been made by
learned Advocate Mr. Nanavati.
5.0 I
have considered submissions made by learned Advocate
Mr. Nanavati
and I have also considered both decisions of the Honourable Apex
Court as relied by the learned Advocate Mr. Nanavati as referred
above. In the case of Gurumallamma, the Honourable Apex Court has
clearly observed that, “Multiplier stricto sensu is not
applicable in the case of fatal accident. The multiplier would be
applicable only in case of disability in non-fatal accidents as would
appear from the Note 5 appended to the Second Schedule. Thus, even
if the application of multiplier is ignored in the present case and
the income of the deceased is taken to be Rs.3,300/- per month, the
amount of compensation payable would be somewhat between 6,84,000/-
to Rs.7,60,000/-. As the Second Schedule provides for a structured
formula, the question of determination of payment of compensation by
application of judicial mind which is otherwise necessary for a
proceeding arising out of a claim petition filed under Section 166
would not arise. The Tribunals in a proceeding under Section 163A of
the Act is required to determine the amount of compensation as
specified in the Second Schedule. It is not required to apply the
multiplier except in a case of injuries and disabilities.”
Similarly, in the case of Reshma Kumari (supra) in Para 38, the
Honourable Apex Court has observed that, Second Schedule refers to
Sec. 163A of the 1988 Act, which as noticed hereinbefore, provides
for quantum of compensation to third party in case of fatal accidents
or injuries suffered. It provides for a table. It specifies the
amount requires to be paid to legal heirs / representatives of the
deceased in the case of fatal accident and the claims in the case of
injuries suffered by them depending upon his age and annual income as
specified therein .
5.1 Thereafter,
in Para 40 of the said decision, the Honourable Apex Court has
observed that, It, however, appears to us that there is no mistake
therein. 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 . In the same decision, in Para 41, the Honourable Apex
Court has observed that, The multiplier, in terms of the Second
Schedule, is required to be applied in a case of disability in
non-fatal accident. Consideration for payment of compensation in the
case of death in a ‘no fault liability’ case vis-?-vis the amount of
compensation payable in a case of permanent total disability and
permanent partial disability in terms of 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 wherefor
the multiplier is not to be applied at all but in a
case involving permanent total disability or 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 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 .
6.0 In
view of the above observations made in both the cases by the same
Division Bench of the Honourable Apex Court deciding the question on
23rd July 2009, it is made clear that in case of fatal
accident, multiplier system is not to be applied but only annual
income of deceased r/w. compensation in case of death between a
particular age, the figure, which has been given against that column
is only to be taken into account. Therefore, in this case,
considering Rs.36,000/- as annual income and age of deceased as 19
years, a multiplier of 16 is not to be applied but only to consider
the amount of compensation in case of death, which has been mention
below annual income of Rs.36,000/-, which comes to Rs.6,84,000/-,
which has been rightly arrived at by the Claims Tribunal, after
proper reading and understanding the Second Schedule and thereafter,
it requires to be deducted 1/3rd amount in consideration
of the expenses, which the victim would have incurred towards
maintaining himself had he been alive. Therefore, according to my
opinion, Claims Tribunal has rightly adopted the method by not
applying the multiplier but considering the annual income of the
deceased and compensation in case of death, which comes to,
considering the age of 19 years, Rs.6,84,000/- has been properly
assessed and thereafter, rightly deducted 1/3rd amount for
doing so, the Claims Tribunal has not committed any error which
requires interference by this Court.
7.0 In
view of both the above decisions of the Honourable Apex Court,
according to my opinion, the Honourable Apex Court has made it clear
in both the cases that multiplier method is to be applied in case of
injury means non-fatal accident but in case of fatal accident,
multiplier method of Second Schedule is not applicable but Claims
Tribunal has to consider only annual income of the deceased and the
age of deceased and amount of compensation in case of death given in
Second Schedule is to be considered.
8.0 Therefore,
submissions made by learned Advocate Mr. Nanavati in Ground D
of the Appeal Memo that after deducting 1/3rd amount from
the monthly income of Rs.3,000/-, a multiplier of 16 has been
applied, which cannot be made applicable in case of death.
Therefore, the contention raised by learned Advocate Mr. Nanavati in
respect of applicability of Second Schedule in case of death is
confusing himself and also creating confusion before this Court and
without going into entire decisions in both the cases cannot be
accepted as in both decisions it has been made clear that multiplier
method of Second Schedule r/w. Sec. 163A is applicable only in case
of injury only and it is irrelevant and not applicable such
multiplier method in case of death and in such circumstances, in case
of death Claims Tribunal has to consider the annual income of
deceased, age of deceased and compensation workout in the Second
Schedule in case of death is to be considered and thereafter to
deduct 1/3rd amount, whatever amount come that is the
amount of compensation available to the claimant. That method has
been rightly applied by the Claims Tribunal and accordingly,
compensation has been rightly worked out, for that, according to my
opinion, the Claims Tribunal has not committed any error, which
requires any interference by this Court.
8.1 The
contention raised by learned Advocate Mr. Nanavati before this Court
that the Claims Tribunal has committed error in calculation of
compensation. He relied upon multiplier of 16. Considering age of
deceased, it comes within 15 to 20 years. He relied upon decision of
the Honourable Apex Court in the case of Reshma Kumari (supra) that
said question has been referred to the Larger Bench, which is not
correct. The question, which has been referred by the Honourable
Apex Court is that, when claimant files application under Sec. 166 to
be decided on ‘fault liability’, in such case, claimant may not get
same amount of compensation which available to claimant if
application is filed under Sec. 163A of the Motor Vehicles Act.
Therefore, a large question, which has been posed by the Honourable
Apex Court in Paras 43 and 44 of the said judgment, are quoted as
under, which give clear picture that which question has been referred
to the Larger Bench.
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 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 the one
specified in the Second Schedule. The Courts, in our opinion, should
also bear that factor in mind.
8.2 According
to the Honourable Apex Court, Sec. 163A r/w. Second Schedule, which
is more liberal and rational than why in a similar situation, the
injured claimant or his legal heirs/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 one specified in the Second
Schedule. The Court, in our opinion, should also bear that factor in
mind. So, this question referred to the Larger Bench by the
Honourable Apex Court. But question which has been raised before
this Court is not referred to the Larger Bench by the Honourable Apex
Court. Therefore, contention raised by learned Advocate Mr. Nanavati
cannot be accepted because in the facts of the present case,
application filed by claimant under Sec. 163A of the Act and
considering age of deceased 19 years and annual income Rs.36,000/-,
the total amount of compensation comes to Rs.6,84,000/- then to
deduct 1/3rd amount then amount comes to Rs.4,56,000/-.
In such circumstances, the calculation suggested by learned Advocate
Mr. Nanavati that instead of that annual income of deceased is to be
considered Rs.24,000/- and to apply 16 multipliers. That contention
of Mr. Nanavati is totally contrary to Sec. 163A r/w. Second
Schedule, because Second Schedule having a particular condition in
Item No. 5, which is quoted as under:
“5. Disability
in non-fatal accidents:
The
following compensation shall be payable in case of disability to the
victim arising out of non-fatal accidents:
Loss
of income, if any, for actual period of disablement not exceeding
fifty two weeks.
PLUS
either of the following:-
(a) In
case of permanent total disablement the amount payable shall be
arrived at by multiplying the annual loss of income by the Multiplier
applicable to the age on the date of determining the compensation, or
(b) In
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) above.
Injuries
deemed to result in Permanent Total Disablement/Permanent Partial
Disablement and percentage of loss of earning capacity shall be as
per Schedule I under Workmen’s Compensation Act, 1923.”
8.3 So,
multiplier is applicable to in case of disability in non-fatal
accident only and multiplier is not applicable in case of fatal
accident. Not only that but looking to annual income of deceased, in
case of fatal accident against respective age of deceased whatever
compensation available to claimant in case of death considering
annual income that amount of compensation is to be worked out first
and then to deduct 1/3rd from that amount and thereafter,
whatever amount comes it considered to be a dependency of claimant.
In Sec. 163A question of considering future prospective amount does
not arise. Not only that in case of deceased being an unmarried, age
of parents or claimant is not necessary to consider but strictly to
calculate the compensation or to workout it, consider Second Schedule
itself. Therefore, calculation suggested by learned Advocate Mr.
Nanavati in Ground ‘D’ of Appeal Memo cannot be accepted because such
theory is not acceptable in light of Second Schedule as well as both
decisions of Honourable Apex Court as referred above also held it
that in case of fatal accident question of multiplier is not
applicable but it applies only in case of disability in non-fatal
accident and in case of death, compensation is to be worked out on
annual income of deceased considering amount of compensation given
against column of age is to be worked out and thereafter, to deduct
1/3rd amount of expenses. This is the correct and legal
formula recognized by statutory provisions. Therefore, confusion
created by learned Advocate Mr. Nanavati cannot be accepted. Though,
law and Sec. 163A r/w. Second Schedule are very clear, there is no
ambiguity at all so which require to refer such question to the
Larger Bench by the Honourable Apex Court. In fact, this question is
not referred by Honourable Apex Court in case of Reshma Kumari.
In
light of aforesaid observations made by this Court, contentions
raised by learned advocate Mr. Parikh cannot be accepted, hence,
rejected, as while deciding 163A application, claims tribunal has to
consider entire matter for calculating or working out compensation
strictly on the basis of annual income of deceased and compensation
which has been worked out as per second schedule considering age of
deceased, thereafter, whatever compensation is worked out as per
second schedule, then, 1/3rd
amount is to be deducted being a personal expenses of deceased and
whatever amount comes to is considered to be a dependency
of claimant. The multiplier method is not applicable in case of death
while deciding 163A application filed by claimant.
The
amount of compensation which has been worked out by claims tribunal
is found to be just, proper and reasonable which cannot consider to
be on higher side and claims tribunal has not committed any error
which requires interference by this Court.
Therefore,
there is no substance in present first appeal. Accordingly, present
first appeal is dismissed.
When
first appeal is dismissed by this Court today, no order is required
to be passed in civil application. Hence, civil application is
disposed of.
The
amount, if any, deposited by appellant before registry of this Court,
be transmitted to claims tribunal concerned, immediately.
Sd/-
[H.K.
RATHOD, J.]
#Dave
Top