C.Y. Somayajulu, J.
1. Since both these Civil Miscellaneous Appeals arise out of the same claim petition, they are being disposed of by a common judgment
2. For the sake of convenience, parties would hereinafter be referred as they are arrayed in the Tribunal.
3. The widow and daughter of S. Rama Rao (the deceased), filed a claim petition seeking compensation of Rs. 11,00,000/-from Respondents 1 to 3, who are the driver and the owners of the R.T.C. Bus bearing No. AAZ 7099, and Respondent Nos. 4 and 5, who are the owner and the insurer of the car in which the deceased was proceeding, alleging that the deceased while travelling in the car of the 4th respondent died as a result of the collision between the car in which he was travelling and the bus being driven by the 1st respondent. The Tribunal having held that the accident took place due to the negligence of the drivers of both the vehicles involved in the accident awarded Rs. 3,66,000/- as compensation to the appellants against Respondent Nos. 1 to 4 only, and exonerated the 5th respondent from liability. Dissatisfied with the quantum of compensation awarded to them, claimants preferred C.M.A. No. 164 of 1995 and aggrieved by the Tribunal exonerating the 5th respondent from its liability, 4th respondent preferred C.M.A. No. 256 of 1995.
4. Since the deceased was a passenger in a car and since he cannot be said to be guilty of any negligence or contributory negligence and since the finding of the Tribunal that the accident occurred due to the rash and negligent driving of both the vehicles has become final, the points that arise for consideration in these appeals are:
(1) To what compensation are the claimants entitled to?
(2) Whether 5th Respondent (insurer of the car belonging to the 4th Respondent) is not liable to pay the compensation payable to the claimants?
Point No. 1:
5. The main contention of learned Counsel for the claimants is that the Tribunal was error in not fixing the contribution of the deceased to the claimants properly and was error in deducting the interest that would accrue on the amount of compensation awarded, when kept in fixed deposit in a bank, from the actual amount of contribution of the deceased to the claimants and since the deceased was drawing a salary of Rs. 5,175/- per month as seen from Ex.A.5, and was aged around 42 years and would have earned increments in future, the claimants are entitled to the entire compensation claimed. The contention of the learned Counsel for the respondents is that the Tribunal awarded just and reasonable compensation and so there are no grounds to interfere with the compensation awarded.
6. Ex.A6, a xerox copy of the service book of the deceased, shows his date of birth as 1.7.1944. The accident occurred on 5.2.1990. So, it is clear that the deceased completed 45 years of age and was in his 46th year by the date of his death. So, the multiplier as per Bhagawandas v. Mohd Arif, 1987 (2) ALT 137, can be taken as ‘10.5’, Ex.A.5, the Last Pay Certificate of the deceased, shows that his basic pay was Rs. 3,500/-, besides Dearness Allowance of. Rs. 1,330/- and House Rent Allowance of Rs. 340/- making a total of Rs. 5,170/- per month. Since the death of the deceased occurred in 1990, as per the Income Tax Law prevailing at that time, any person whose annual net income exceeds Rs. 18,000/- was liable to pay income tax. At that time the basic deduction for a salaried employee was Rs. 1,2,000/-. So, a salaried employee whose total income was less than Rs. 30,000/- per year was not liable to pay income tax. Since the salary of the deceased was more than Rs. 30,000/-per year by the date of his death he was liable to pay income tax. I am unable to agree with the contention of the learned Counsel for the claimants that since Ex.A5 docs not disclose any deductions from the salary of the deceased towards income-tax etc., and since the possibility of the deceased saving some amounts, which would make him eligible for complete exemption from income tax liability, cannot be ruled out, the entire amount of salary received by the deceased has to be taken into consideration for computing the compensation payable to the claimants. If the deceased was investing a part of his salary in some schemes, to keep him out of income tax liability, the amount invested by him would be a saving which increases the value of his estate, but that amount cannot be treated as a contribution to the claimants, every month, towards their maintenance. Since the gross salary of the deceased was about Rs. 5,000/- per month, taking into consideration the deductions and investments made for keeping him out of income tax liability, personal expenses etc., the contribution of the deceased to the claimants can be taken as about Rs. 33,000/-per annum. So, the pecuniary damages payable to the claimants would come to Rs. 33,000/- x 10.5 = Rs. 3,46,500/-.
7. Since the first petitioner lost her husband, she is entitled to loss of consortium of Rs. 15,000/- as held in General Manager, Kerala State Road Transport Corporation v. Susamma Thomas, .
8. Since the deceased was earning Rs. 5,000/- per month by the date of his death and would have earned promotions in future, and since in Y. Varalakshmi v. M. Nageswara Rao, , it is held that in every case of a fatal accident, a minimum compensation of Rs. 15,000/-should be awarded to the claimants towards non-pecuniary damages, the non-pecuniary damages can be fixed at Rs. 38,500/-.
9. Thus, the claimants are entitled to Rs. 3,46,500/- + Rs. 15,000/- + Rs. 38,500/- = Rs. 4,00,000/- as compensation for the death of the deceased. The point is answered accordingly.
Point No. 2:
10. On the ground that the evidence of R.W.2 shows that the car bearing No. AEV 9801, insured under Ex.B.1, does not cover the risk of the employees of the Food Corporation of India, and since the deceased was an employee of the Food Corporation of India, the Tribunal held that 4th respondent is not liable to pay the compensation payable to the claimants. When the terms and conditions of the policy are contained in Ex.B.1, they alone have to be taken into consideration for finding out if the 4th respondent is liable to pay compensation or not, and the liability of 4th respondent cannot be decided on the oral evidence of R.W.1.
Section II – Liability to third parties, in Ex.B.1, reads:
“1. The Company will indemnify the insured in the event of accident caused by or arising out of the use of the Motor Car against all sums including claimant’s cost and expenses which the insured shall become legally liable to pay in respect of
(a) death or bodily injury to any person including occupants carried in the Motor Car provided that such occupants are not carried for hire or reward but except so far as is necessary to meet the requirements of Section 95 of the Motor Vehicles Act, 1939, the Company shall not be liable where such death or injury arises out of and in the course of the employment of such person by the insured.
From the underlined portion in Clause (a) above, it is clear that occupants of the car are covered so long as they are not fare paying passengers. Deceased, admittedly, was not travelling as a fare paying passenger in the car. So, deceased also is covered by the said policy.
For understanding the meaning of “death or injury arises out of and in the course of employment of such person by the insured” used in Clause (a) extracted above, and relied on by the Tribunal for exonerating the 4th respondent, Section 95 of the Motor Vehicles Act, 1939, has to be read.
“(I) In order to comply with the requirements of this Chapter, a policy of insurance may be a policy which–
(a) is issued by a person who is an authorized insurer [or by a co-operative society allowed under Section 108 to transact the business of an insurer]; and
(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 or damage to any property of a third party caused by or arising out of the use of the vehicle in a public place;
(ii) against the death of or bodily injury to any passenger of a public service vehicle caused by, or arising out of, the use of the vehicle in a public place:
Provided that a policy shall not be required–
(i) to cover the 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 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 a conductor of the vehicle, or in examining tickets on the vehicle; or
(c) if it is a goods vehicle, being carried in the vehicle] or
(ii) except where the vehicle is a vehicle in which passengers are carried for hire or reward or by reason of or in pursuance of a contract of employment, to cover liability in respect of the death of or bodily injury to persons being carried in or upon or entering or mounting or alighting from the vehicle at the time of the occurrence of the event out of which a claim arises, or
(iii) to cover any contractual liability.
[*Explanation:–For the removal of doubts, it is hereby declared that the death of or bodily injury to any person or damage to any property of a third party shall be deemed to have been caused by, or to have arisen out of the use of a vehicle in a public place notwithstanding that the person who is dead or injured or the property which is damaged was not in a public place at the time of the accident, if the act or omission which led to the accident occurred in a public place.]
So it is clear from the proviso to Section 95 of Motor Vehicles Act, 1939 that exemption from insurance, which otherwise is compulsory, is given only to the employees travelling in the course of employment in goods or public service vehicles, but has no application to employees of the owner of a car. So, merely because the deceased was an employee of the Food Corporation of India, which is the owner of the car in which the deceased was travelling, the insurer i.e., 5th respondent cannot avoid its liability. So, the Tribunal was error in holding that the 5th respondent is not liable to pay compensation to the claimants and so, I hold that 5th respondent also is liable to pay the compensation payable to the claimants. The point is answered accordingly.
11. In the result, both appeals are allowed. The award passed by the Tribunal is modified. An award is passed for Rs. 4,00,000/- in favour of the claimants against the respondents with interest at 12% p.a. on Rs. 3,66,000/- from the date of petition till the date of deposit and with interest at 9% p.a. on Rs. 34,000/- from the date of award of the Tribunal i.e., 10-10-1994 till the date of deposit, with proportionate costs in the Tribunal. Rest of the claim of the claimants is dismissed without costs. The liability of Respondents 1 to 3 is to the extent of Rs. 2,00,000/- and interest thereon and the liability of Respondents 4 and 5 is to the extent of Rs. 2,00,000/-and interest thereon. First appellant is entitled to Rs. 2,15,000/- and interest thereon, and second appellant is entitled to Rs. 1,85,000/- and interest thereon. Parties shall bear their own costs in these appeals.