Chattisgarh High Court
Bandhan Singh vs Itwar Singh on 18 July, 2025
Author: Parth Prateem Sahu
Bench: Parth Prateem Sahu
1
2025:CGHC:34117
NAFR
HIGH COURT OF CHHATTISGARH AT BILASPUR
MAC No. 329 of 2019
1 - Bandhan Singh, S/o. Late Kunjram Binjhwar, Aged About 52 Years,
2 - Smt. Dileshwaribai, W/o. Radheshyam, Aged About 26 Years D/o
Bandhan Singh Binjhwar,
Both are R/o Village Chhueyapara Darri P.S. Kusmunda Chowki Hardibazar
P.O. Bhilaibazar Tahsil Katghora, District- Korba, Chhattisgarh.
--- Appellants
versus
1 - Itwar Singh S/o Sangram Singh (Driver Of The Vehicle),
2 - Sangram Singh S/o Late Mangalu Singh (Owner Of The Vehicle),
Both are R/o Dhelwadih Colony Q.N. 14/131 Tahsil Katghora, District- Korba,
Chhattisgarh.
3 - The Iffco Tokio General Insurance Co. Ltd. Iffco Sadan C-1, District-
Saket New Delhi. .........(Insurer)
4 - I.C.I.C.I. Lombard General Insurance Co.Ltd. Address I.C.I.C.I. Lombard
House 414 Vir Sawarkar Marg Siddhi Vinayak Mandir Prabha Devi
Mumbai.400025. ...........(Insurer).
....Respondents
For Appellants : Mr. Vikash Patel, Advocate on behalf of
Mr. P.K. Tulsyan, Advocate
For Respondent No.1 & 2 : Mr. Abhinav Tiwari, Advocate on behalf of
Mr. Manish Upadhyay, Advocate
For Respondent No.3 : Mr. P.R. Patankar, Advocate
For Respondent No.4 : Mr. Amitesh Pathak, Advocate on behalf of
Mr. Amrito Das, Advocate
BALRAM
Hon’ble Shri Justice Parth Prateem Sahu
PRASAD
DEWANGAN Order On Board
Digitally signed by
BALRAM PRASAD
DEWANGAN
Date: 2025.08.06
18/07/2025
13:25:36 +0530
2
1. Claimants/appellants have filed this appeal under Section 173 of the
Motor Vehicles Act, 1988 (for short ‘the Act of 1988’) seeking
enhancement of compensation awarded by the learned Additional
Motor Accident Claims Tribunal, Katghora, District – Korba (for short
‘the Claims Tribunal’) vide award dated 16.10.2018 passed in Claim
Case No.153/2016 thereby allowing application in part and awarding
Rs.36,82,444/- as compensation in a death case.
2. Facts relevant for disposal of this appeal are that appellants/claimants
filed an application under Section 166 of the Act of 1988 claiming total
compensation of Rs.42,63,816/- under different heads on account of
the death of Revti Raman Singh, who died in the road accident,
pleading therein that on 18.4.2016 Revati Raman Singh was going to
his night duty on his motorcycle No. CG12 AM 4933, when he reached
near Arda Turn, non-applicant No.1 while driving the offending motor
cycle no. CG12 B 6901 rashly and negligently, hit Revati Raman Singh
due to which he suffered serious injuries. He was immediately taken to
SECL Banki Hospital. Looking to his serious conditions, he was
referred to Balaji Trauma Centre Hospital, Korba for treatment, where
during treatment he died on 19.4.2016. It was also pleaded that at the
time of accident, deceased was employed as General Mazdoor
Category-I and getting net monthly salary of Rs.22,262/-. The
claimants are dependent upon him and due to his untimely death they
are facing great financial crises.
3. No reply was filed on behalf of respondent No.1 and 2. Non-applicant
No.3 filed its reply resisting the claim of the claimants. It was pleaded
that the deceased, fell from his own motorcycle and suffered fatal
3
injuries. It was further pleaded that the incident was reported after 45
days implicating the owner and driver of the alleged offending vehicle
in order to get compensation. Additionally, it was pleaded that Non-
applicant No. 1 did not possess a valid and effective driving licence at
the time of the incident, and motorcycle was being driven in violation of
the terms and conditions of the insurance policy. Non-applicant No.4
also filed its reply denying the averments made in the application. It
was pleaded that accident occurred due to rash and negligent driving
of motor cycle driven by non-applicant No.1.
4. The learned Claims Tribunal upon appreciation of the pleadings and
the evidence brought on record by respective parties, allowed the
claim application in part, awarded total compensation of
Rs.36,82,444/- and fastened liability upon non-applicant No.1 and 2,
owner and driver of offending vehicle holding that on the date and time
of accident, non-applicant was not holding valid and effective driving
license to drive the offending vehicle. .
5. Learned counsel for appellants submits that learned Claims Tribunal
assessed the income of the deceased on lower side. It is submitted
that the learned Claims Tribunal erred in deducting amounts towards
PF, PPF, APF, LIC, and other similar heads from the monthly income
of the deceased, took net income of ₹22,262/- mentioned in the
document, which is not legally sustainable. He further contended that
learned Claims Tribunal has wrongly exonerated the insurance
company from its liability holding that non-applicant No.1 did not
possess valid and effective driving license. It is contended that on the
date of accident, the offending vehicle was duly insured with non-
4
applicant No.3. Therefore, despite breach of conditions of the
insurance policy, the learned Claims Tribunal ought to have directed
the insurer/non-applicant No.3 to first satisfy the amount of
compensation to the claimants and thereafter recover the same from
owner of the offending vehicle, in accordance with the settled
principles of law.
6. Learned counsel for respondents No.3 and 4 opposes the submission
of learned counsel for appellants and supports the impugned award.
They submits that the learned Claims Tribunal after appreciating of all
the documentary and oral evidence brought on record has passed the
impugned award, which does not call for any interference.
7. Learned counsel for respondents No.1 and 2 opposes the submissions
advanced by the learned counsel for the appellants. He contends that
the learned Claims Tribunal erred in concluding that, on the date of
accident, non-applicant No.1 did not possess a valid and effective
driving license. He further submits that the vehicle in question was
duly insured with non-applicant No.3 at the relevant time. Therefore,
the learned Claims Tribunal has committed serious error in fastening
liability for payment of compensation upon non-applicants No.1 and 2,
instead of directing the insurer to satisfy the award.
8. I have heard learned counsel for parties and also perused the record
of claim case.
9. In order to appreciate the grounds raised by learned counsel for
appellants/claimants that the learned Claims Tribunal erred in
assessing income of the deceased to calculate the compensation, I
5
have perused (Ex.P-18), which is a salary slip of March, 2016. As per
the salary slip (Ex.P-18), deceased Rewati Raman Singh was working
as General Mazdoor in SECL, Gevra Project and his net pay has been
mentioned as Rs.22,262/- and gross deduction of Rs.6,415/-, which
includes the PF, EPF, APF, LIC recovery etc. The learned Claims
Tribunal while assessing the monthly income of the deceased has not
made any discussion about the gross deduction of Rs.6,415/-.
10. Hon’ble Supreme Court in the case of Vimal Kanwar and others v.
Kishore Dan and others reported in (2013) 7SCC 476, has
considered that the deduction from salary of an employee towards
investment and saving which he will receive in future has to be treated
as income and held thus:-
“18. The first issue is “whether provident fund, pension
and insurance receivable by claimants come within the
periphery of the Motor Vehicles Act to be termed as
‘pecuniary advantage’ liable for deduction.
19. The aforesaid issue fell for consideration before this
Court in Helen C. Rebello v. Maharashtra SRTC, (1999) 1
SCC 90. In the said case, this Court held that Provident
Fund, Pension, Insurance and similarly any cash, bank
balance, shares, fixed deposits, etc. are all a “pecuniary
advantage” receivable by the heirs on account of one’s
death but all these have no correlation with the amount
receivable under a statute occasioned only on account of
accidental death. Such an amount will not come within the
periphery of the Motor Vehicles Act to be termed as
“pecuniary advantage” liable for deduction. The following
was the observation and finding of this Court: (SCC pp.
111-12, para 35)“(35). Broadly, we may examine the receipt of the
provident fund which is a deferred payment out of the
contribution made by an employee during the tenure
of his service. Such employee or his heirs are entitled
to receive this amount irrespective of the accidental
death. This amount is secured, is certain to be
6received, while the amount under the Motor Vehicles
Act is uncertain and is receivable only on the
happening of the event, viz., accident, which may not
take place at all. Similarly, family pension is also
earned by an employee for the benefit of his family in
the form of his contribution in the service in terms of
the service conditions receivable by the heirs after his
death. The heirs receive family pension even
otherwise than the accidental death. No correlation
between the two. Similarly, life insurance policy
amount is received either by the insured or the heirs of
the insured on account of the contract with the insurer,
for which insured contributes in the form of premium. It
is receivable even by the insured if he lives till maturity
after paying all the premiums. In the case of death, the
insurer indemnifies to pay the sum to the heirs, again
in terms of the contract for the premium paid. Again,
this amount is receivable by the claimant not on
account of any accidental death but otherwise on the
insured’s death. Death is only a step or contingency in
terms of the contract, to receive the amount. Similarly,
any cash, bank balance, shares, fixed deposits, etc.
though all are pecuniary advantage receivable by the
heirs on account of one’s death but all these have no
correlation with the amount receivable under a statute
occasioned only on account of accidental death. How
could such an amount come within the periphery of
the Motor Vehicles Act to be termed as ‘pecuniary
advantage’ liable for deduction? When we seek the
principle of loss and gain, it has to be on a similar and
same plane having nexus, inter se, between them and
not to which there is no semblance of any correlation.
The insured (deceased) contributes his own money for
which he receives the amount which has no
correlation to the compensation computed as against
the tortfeasor for his negligence on account of the
accident. As aforesaid, the amount receivable as
compensation under the Act is on account of the injury
or death without making any contribution towards it,
then how can the fruits of an amount received through
contributions of the insured be deducted out of the
amount receivable under the Motor Vehicles Act? The
amount under this Act he receives without any
contribution. As we have said, the compensation
payable under the Motor Vehicles Act is statutory
7
while the amount receivable under the life insurance
policy is contractual.”
11. In another judgment, rendered by the Hon’ble Supreme Court in case
of National Insurance Company Vs. Indira Shrivastava reported in
(2008) 2 SCC 763, has also considered income of the deceased for
the purpose of awarding compensation and held as under :
“19. The amounts, therefore, which were required to be
paid to the deceased by his employer by way of perks,
should be included for computation of his monthly income
as that would have been added to his monthly income by
way of contribution to the family as contradistinguished to
the ones which were for his benefit. We may, however,
hasten to add that from the said amount of income, the
statutory amount of tax payable thereupon must be
deducted.”
12. Recently in a judgment dated 11th July, 2024 in National Insurance
Company Ltd. v. Nalini and Ors. [Petition for Special Leave to
Appeal (C) No. 4230/2019], Hon’ble Supreme Court has held that,
allowances under the heads of transport allowance, house rent
allowance, provident fund loan, provident fund and special allowance
ought to be added while considering the basic salary of the
victim/deceased to arrive at the dependency factor.
13. In the case at hand, the learned Claims Tribunal has assessed the
total income of the deceased as Rs.22,262/- per month, the learned
Claims Tribunal failed to add the gross deduction of Rs.6,415/, which
was deducted towards PF, EPF, APF, LIC recovery etc. in the income
of the deceased. The amount of EPF, PF, APF, LIC are the amounts of
savings of the deceased, employee which is for the benefit of all family
8
members. It is not the amount receivable only on account of accidental
death. Learned Claims Tribunal failed to consider the amount of
Rs.6,415/-, which was deducted towards PF, EPF, APF, LIC etc as
income of the deceased, has only taken the net pay of deceased,
which deserves to be and is hereby set aside. Now the monthly
income/salary of the deceased is assessed as Rs.22,262/- net pay +
gross deduction of Rs.6,415/- = Rs.28,677/-.
14. The learned Claims Tribunal has rightly added 50% towards future
prospects in the assessed income of the deceased, deducted 1/2
towards personal living expenses and applied multiplier of 18.
15. Further the learned Claims Tribunal has awarded Rs.50,000/- towards
love and affection and Rs.25,000/- for funeral expenses. No amount
was awarded towards loss of estate and for loss of consortium.
16. The Hon’ble Supreme Court in case of National Insurance Company
Limited. Vs. Pranay Sethi & Ors, reported in (2017) 16 SCC 680,
has quantified the amount of compensation to be awarded under the
head loss estate and funeral expenses of Rs.15,000/- each and
Rs.40,000/- for loss of consortium. The learned Claims Tribunal has
awarded Rs.25,000/- towards funeral expenses, however, no amount
has been awarded towards loss of estate. The amount of Rs.25,000/-
awarded towards funeral expenses is not sustainable, which is
required to be reduced to Rs.15,000/- as per the decision in case of
Pranay Sethi (supra). It is ordered accordingly. As no amount towards
loss of estate is awarded, therefore, Rs.15,000/- is awarded to the
appellants towards loss of estate.
9
17. The Hon’ble Supreme Court in case of Magma General Insurance
Company Limited vs. Nanu Ram alias Chuhru Ram & ors reported
in (2018) 18 SCC 130 has explained the types of consortium and held
that there are three types of loss of consortium i.e. loss of spousal
consortium for widow/widower, loss of parental consortium to the
children and loss of filial consortium to parents. The appellant No.1
being father of deceased is entitled for filial consortium of Rs.40,000/-.
It is ordered accordingly. Because loss of love and affection
subsumes compensation of loss of consortium and hence, the
claimants will not be entitled for compensation under the head of loss
of love and affection accordingly. It is set-aside.
18. The amount of Rs.50,000/- awarded towards love and affection is not
sustainable. It is set-aside.
19. On the basis of above, the compensation calculated by the Tribunal is
recomputed as under :-
SN Head Amount (in Rs.). 1. Annual income : 28,677 x 12 = 3,44,124.00
2. Addition of 50% towards future : 3,44,124 + 1,72,062.00 = 5,16,186.00
prospects
3. 1/2 deduction towards personal : 5,16,186.00 -2,58,093.00 = 2,58,093.00
expenses
4. Loss of dependency after : 2,58,093 x 18 = 46,45,674.00
application of multiplier of 18
5. For loss of filial consortium to : 40,000.00
the appellant No.1
6. For funeral expenses : 15,000.00
7. For loss of estate : 15,000.00
Grand Total : 47,15,674.00
10
20. Accordingly, the appeal is allowed in part. Now the appellants shall be
entitled for total compensation of Rs.47,15,674.00. Any amount paid to
the appellants as compensation as per impugned award shall be
adjusted. Enhanced amount of compensation shall carry interest @
8% per annum from the date of filing of application till its realization.
Rest of the conditions mentioned in the impugned award shall remain
intact.
21. As regards the submission of learned counsel for the appellants
seeking a direction to non-applicant No.3 to first pay the compensation
and subsequently recover the amount from the owner, the learned
Claims Tribunal, upon due appreciation of oral and documentary
evidence, recorded a finding that non-applicant No.1 did not possess a
valid and effective driving license on the date of the accident.
Accordingly, it held that the vehicle was being operated in violation of
the terms of the insurance policy, exonerated the insurer from liability,
and fastened the responsibility for payment of compensation upon
non-applicants No.1 and 2, the driver and owner of the offending
vehicle. The above finding is correct and in accordance with law.
However, in the facts of the case, consideration is whether Tribunal fell
into error in not issuing direction of pay and recover.
22. The issue with respect to issuance of direction to the insurance
company to first pay the amount of compensation and thereafter, to
recover the same from the owner and driver was considered by the
Hon’ble Supreme Court in case of National Insurance Company Vs.
Swaran Singh, reported in (2004) 3 SCC 297. Relying upon the
decision in case of Swaran Singh (supra), the Hon’ble Supreme
11
Court in case of Shamanna & Anr. Vs. Divisional Manager, Oriental
Insurance Company Ltd. & Ors., reported in (2018) 9 SCC 650 has
issued direction to pay and recover, in a case of no driving license with
the driver on the date of accident and observed in para 5, 6 and 13,
which reads as under :-
“5. In the case of third-party risks, as per the decision in
National Insurance Co. Ltd. v. Swaran Singh [National Insurance
Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004 SCC (Cri)
733] , the insurer had to indemnify the compensation amount
payable to the third-party and the insurance company may
recover the same from the insured. Doctrine of “pay and
recover” was considered by the Supreme Court in Swaran Singh
case [National Insurance Co. Ltd. v. Swaran Singh, (2004) 3
SCC 297 : 2004 SCC (Cri) 733] wherein the Supreme Court
examined the liability of the insurance company in cases of
breach of policy condition due to disqualifications of the driver or
invalid driving licence of the driver and held that in case of third-
party risks, the insurer has to indemnify the compensation
amount to the third-party and the insurance company may
recover the same from the insured. Elaborately considering the
insurer’s contractual liability as well as statutory liability vis-à-vis
the claims of third parties, the Supreme Court issued detailed
guidelines as to how and in what circumstances, “pay and
recover” can be ordered. In para 110, the Supreme Court
summarised its conclusions as under : (SCC pp. 341-42)“110. The summary of our findings to the various issues as
raised in these petitions is as follows:
(i) Chapter XI of the Motor Vehicles Act, 1988 providing
compulsory insurance of vehicles against third-party risks is a
social welfare legislation to extend relief by compensation to
victims of accidents caused by use of motor vehicles. The
provisions of compulsory insurance coverage of all vehicles are
12with this paramount object and the provisions of the Act have to
be so interpreted as to effectuate the said object.
(ii) An insurer is entitled to raise a defence in a claim petition
filed under Section 163-A or Section 166 of the Motor Vehicles
Act, 1988, inter alia, in terms of Section 149(2)(a)(ii) of the said
Act.
(iii) The breach of policy condition e.g. disqualification of the
driver or invalid driving licence of the driver, as contained in sub-
section (2)(a)(ii) of Section 149, has to be proved to have been
committed by the insured for avoiding liability by the insurer.
Mere absence, fake or invalid driving licence or disqualification
of the driver for driving at the relevant time, are not in
themselves defences available to the insurer against either the
insured or the third parties. To avoid its liability towards the
insured, the insurer has to prove that the insured was guilty of
negligence and failed to exercise reasonable care in the matter
of fulfilling the condition of the policy regarding use of vehicles
by a duly licensed driver or one who was not disqualified to drive
at the relevant time.
(iv) Insurance companies, however, with a view to avoid their
liability must not only establish the available defence(s) raised in
the said proceedings but must also establish “breach” on the
part of the owner of the vehicle; the burden of proof wherefor
would be on them.
(v) The court cannot lay down any criteria as to how the said
burden would be discharged, inasmuch as the same would
depend upon the facts and circumstances of each case.
(vi) Even where the insurer is able to prove breach on the part of
the insured concerning the policy condition regarding holding of
a valid licence by the driver or his qualification to drive during
the relevant period, the insurer would not be allowed to avoid its
liability towards the insured unless the said breach or breaches
on the condition of driving licence is/are so fundamental as are
13
found to have contributed to the cause of the accident. The
Tribunals in interpreting the policy conditions would apply “the
rule of main purpose” and the concept of “fundamental breach”
to allow defences available to the insurer under Section 149(2)
of the Act.
(vii) The question, as to whether the owner has taken
reasonable care to find out as to whether the driving licence
produced by the driver (a fake one or otherwise), does not fulfil
the requirements of law or not will have to be determined in
each case.
(viii) If a vehicle at the time of accident was driven by a person
having a learner’s licence, the insurance companies would be
liable to satisfy the decree.
(ix) The Claims Tribunal constituted under Section 165 read with
Section 168 is empowered to adjudicate all claims in respect of
the accidents involving death or of bodily injury or damage to
property of third-party arising in use of motor vehicle. The said
power of the Tribunal is not restricted to decide the claims inter
se between claimant or claimants on one side and insured,
insurer and driver on the other. In the course of adjudicating the
claim for compensation and to decide the availability of defence
or defences to the insurer, the Tribunal has necessarily the
power and jurisdiction to decide disputes inter se between the
insurer and the insured. The decision rendered on the claims
and disputes inter se between the insurer and insured in the
course of adjudication of claim for compensation by the
claimants and the award made thereon is enforceable and
executable in the same manner as provided in Section 174 of
the Act for enforcement and execution of the award in favour of
the claimants.
(x) Where on adjudication of the claim under the Act the Tribunal
arrives at a conclusion that the insurer has satisfactorily proved
its defence in accordance with the provisions of Section 149(2)
read with sub-section (7), as interpreted by this Court above, the
14Tribunal can direct that the insurer is liable to be reimbursed by
the insured for the compensation and other amounts which it
has been compelled to pay to the third-party under the award of
the Tribunal. Such determination of claim by the Tribunal will be
enforceable and the money found due to the insurer from the
insured will be recoverable on a certificate issued by the Tribunal
to the Collector in the same manner under Section 174 of the
Act as arrears of land revenue. The certificate will be issued for
the recovery as arrears of land revenue only if, as required by
sub-section (3) of Section 168 of the Act the insured fails to
deposit the amount awarded in favour of the insurer within thirty
days from the date of announcement of the award by the
Tribunal.
(xi) The provisions contained in sub-section (4) with the proviso
thereunder and sub-section (5) which are intended to cover
specified contingencies mentioned therein to enable the insurer
to recover the amount paid under the contract of insurance on
behalf of the insured can be taken recourse to by the Tribunal
and be extended to claims and defences of the insurer against
the insured by relegating them to the remedy before regular
court in cases where on given facts and circumstances
adjudication of their claims inter se might delay the adjudication
of the claims of the victims.”
(emphasis supplied)
6. As per the decision in Swaran Singh case [National
Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004
SCC (Cri) 733] , onus is always upon the insurance company to
prove that the driver had no valid driving licence and that there
was breach of policy conditions. Where the driver did not
possess the valid driving licence and there are breach of policy
conditions, “pay and recover” can be ordered in case of third-
party risks. The Tribunal is required to consider
“as to whether the owner has taken reasonable care to
find out as to whether the driving licence produced by the driver
15
… does not fulfil the requirements of law or not will have to be
determined in each case”.
13. Since the reference to the larger Bench in Parvathneni
case [National Insurance Co. Ltd. v. Parvathneni, (2009) 8 SCC
785 : (2009) 3 SCC (Civ) 568 : (2009) 3 SCC (Cri) 943] has
been disposed of by keeping the questions of law open to be
decided in an appropriate case, presently the decision in
Swaran Singh case [National Insurance Co. Ltd. v. Swaran
Singh, (2004) 3 SCC 297 : 2004 SCC (Cri) 733] followed in
Laxmi Narain Dhut [National Insurance Co. Ltd. v. Laxmi Narain
Dhut, (2007) 3 SCC 700 : (2007) 2 SCC (Cri) 142] and other
cases hold the field. The award passed by the Tribunal directing
the insurance company to pay the compensation amount
awarded to the claimants and thereafter, recover the same from
the owner of the vehicle in question, is in accordance with the
judgment passed by this Court in Swaran Singh [National
Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297 : 2004
SCC (Cri) 733] and Laxmi Narain Dhut [National Insurance Co.
Ltd. v. Laxmi Narain Dhut, (2007) 3 SCC 700 : (2007) 2 SCC
(Cri) 142] cases. While so, in our view, the High Court ought not
to have interfered with the award passed by the Tribunal
directing the first respondent to pay and recover from the owner
of the vehicle. The impugned judgment [Shamanna v. Laxman,
2016 SCC OnLine Kar 6928] of the High Court exonerating the
insurance company from its liability and directing the claimants
to recover the compensation from the owner of the vehicle is set
aside and the award passed by the Tribunal is restored.”
23. The Act of 1988 is indeed considered a piece of welfare legislation.
Under the Act the injured or the family members of the deceased can
file an application seeking compensation against the loss suffered by
them and to protect their interest and to save them from deprivation of
the income of the deceased.
16
24. For the foregoing discussion and in view of aforementioned decisions
of Hon’ble Supreme Court, the non-applicant No.3/Insurance
Company is directed to first pay the amount of compensation and
thereafter to recover the same from owner of the vehicle. It is made
clear that the Insurance Company can recover the amount of
compensation so paid in terms of observation made by Hon’ble
Supreme Court in case of Oriental Insurance Co. Ltd. v. Nanjappan,
(2004) 13 SCC 224 in same execution proceeding.
25. In the result, the appeal is allowed in part and the award impugned
stands modified to the extent indicated above.
Sd/-
(Parth Prateem Sahu)
Judge
Balram
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