Bombay High Court
United India Insurance Co. Ltd. vs 1. Rukmini Deepak Alias Dilip Kachare … on 2 July, 2025
2025:BHC-AS:27695
WAKLE
MANOJ
JANARDHAN Manoj 9-FA-105-2007.doc
Digitally signed by
WAKLE MANOJ
JANARDHAN
Date: 2025.07.09
11:15:59 +0530
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
FIRST APPEAL NO. 105 OF 2007
United India Insurance Company Limited
having its Regional Office At No.II at
Maker Bhavan-1 Sir V.T. Marg. Churchgate
Mumbai 400020 ...Appellant /
Original Insurer
(Opponent No.2)
V/s.
1. Smt. Rukmini Deepak alias Dilip
Kachare, aged about 27 years,
residing at Prem Nagar Vasahat , Near
Datta Mandir Near Gop-Chawl B.G. Kher
Marg, Near Coca Cola Company. Worli
Mumbai 400018 (wife of the deceased)
2. Shri. Nana Deepak alias Dilip Kachare,
Age about 4 years, being minor
through his mother and next friend i.e.
No.1 abovenamed (son of deceased)
3. Sheetal Deepak alias Dilip Kachare
aged abut 2 years, residing at as
above, being minor through her mother
and next friend, i.e., No. 1 abovenamed
(daughter of deceased)
4. Girish Deepak alias Dilip Kachare,
Age: 9 months, residing at as above
being minor through his mother and next
friend i.e. No.1 abovenamed (son of deceased)
5. Smt. Indirabai Govind Kachare,
aged about 52 years, residing at as above
(mother of the deceased)
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6. Shri. Balasaheb P. Ghule,
Age: Adult, residing at Manjari Budruk,
Taluka- Haveli, District- Pune. ...Respondents
Mr. H. G. Misar, for the Appellant.
Mr. T. J. Mendon, for the Respondent Nos. 1 to 5.
Mr. Veerdhawal Deshmukh, Appointed as Amicus Curiae.
CORAM : SHYAM C. CHANDAK, J.
RESERVED ON : 05th MAY, 2025
PRONOUNCED ON : 02nd JULY, 2025
JUDGMENT:
–
. The insurer has preferred this Appeal under Section 173
of the Motor Vehicles Act, 1988 (“the Act”) being aggrieved by the
Judgment and Award dated 13/10/2006, in Application No.2935 of
1996 (“claim”), passed by the Motor Accident Claims Tribunal,
Mumbai (“Tribunal”) thereby the said claim was partly allowed with
proportionate costs and the Appellant and Respondent No.6 were
held jointly and severally liable to pay a sum of Rs.3,66,000/- to
Respondent Nos.1 to 5, alongwith interest @ 7.5% per annum from
01/02/1999 till realization of said amount. The Appeal has been filed
on the ground that the Tribunal did not pass the pay and recover
order in favour of the Appellant.
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Manoj 9-FA-105-2007.doc 2) As per the record, Appeal was admitted on 17/01/2007.
Thereafter, the notice of the Appeal was sent to Respondent No.6.
The notice returned alongwith the Report of the bailiff stating that
Respondent No.6 has expired on 26/06/2006, i.e., during pendency
of the claim. Hence, the learned Registrar (Judicial-II) of this Court
passed an Order on 20/08/2014 that, the Appeal abated against
Respondent No.6. As noted in this Court’s Order dated 08/01/2025,
Mr. Misar, the learned Advocate for the Appellant sought time to take
steps against Respondent No.6. However, no steps have been taken.
That apart, Mr. Misar, stated that the Appellant is not willing to take
the steps in respect of the deceased Respondent No.6. The Appeal is
more than 15 years old.
3) Hence, heard Mr. Misar, the learned Advocate for the
Appellant, Mr. Mendon, the learned Advocate for the Claimants and
Mr. Deshmukh, the learned Amicus Curiae. Perused the record.
4) The Claimants are the legal representatives of late Deepak
@ Dilip Govind Kachare (“Deceased”). It was the case of the
Claimants that, on 25/06/1996, at about 7:00 PM, the deceased was
pillion on a Motorcycle bearing No. MHQ-594 (“M/cycle”) and
proceeding from Indapur towards Teguni, by the Pune-Solapur
highway. Mr. Avinash Khashale, friend of the deceased was riding the
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M/cycle. When the M/cycle reached near KM No.139/4 on the said
road, a motor truck bearing No.MH-12/R-9191 (“Truck”) came from
Indapur towards Teguni and dashed the M/cycle on its rear side. As
a result, the claimant and his friend both sustained serious injuries
and died on the spot. It was averred that the accident occurred due to
rash and negligent driving of the truck. On information, initially,
Indapur Police Station registered the Accident No.113/1996. Later
on, PSI – Mr. N. S. Jagtap filed the Report (Exh.14) which was
registered as F.I.R. No.83/1996 against the driver of the truck
namely Mr. Ramdas Sandipan Patole, under Sections 279, 304A and
427 of I.P.C. read with Sections 183 and 184 of the Act.
4.1) It was averred that, the deceased was aged 30 years, he
was serving for Mr. Kundalik Kisan Bandgar and getting a monthly
salary of Rs.3,200/-. The Claimants were dependent on the deceased.
Therefore, they filed the said claim seeking compensation of
Rs.5,00,000/- with interest @ 12% per annum from Respondent
No.6/Original Opposite party and the Appellant, who were the owner
and insurer of the truck.
5) Despite the notice, Respondent No.6 did not file his
appearance and let the claim proceeded against in his absence.
6) Therefore, Appellant filed an Application (Exh.4) under 4/48 ::: Uploaded on - 09/07/2025 ::: Downloaded on - 01/08/2025 21:12:38 ::: Manoj 9-FA-105-2007.doc
Section 170 (b) of the Act. Therein it was stated that, as Respondent
No.6 remained absent and set ex-parte, the Appellant’s Advocate sent
a notice to Respondent No.6 and informed him to attend in the claim
before the Tribunal. Yet, Respondent No.6 chose to remain absent.
Hence, the Appellant be allowed to take all the defences available to
Respondent No.6, under Section 147 of the Act. The Advocate for the
Claimants gave his “no objection” to that Application. Hence, the
Tribunal granted the Application (Exh.4).
6.1) Accordingly, the Appellant contested the claim filing the
Written Statement (Exh.5) and denied all material allegations and
averment made in the claim. The Appellant contended that the
accident occurred due to negligence on the part of the rider of the
M/cycle. It was contended that the driver of the truck was not
holding a valid and effective driving licence at the time of the
accident. It was contended that, after the accident, Respondent No.1
submitted a Claim Form with the Appellant therein it was stated that
Mr. Ramdas Sandipan Patole, was employed as driver by Respondent
No.1 and he was driving the truck. But the enclosed driving licence
No.89/C/1472 of Mr. Ramdas Sandipan Patole, issued by RTO
Mumbai, expired on 25/06/1996. Therefore, the Appellant prayed to
dismiss the claim.
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Manoj 9-FA-105-2007.doc 7) In view of the rival pleadings, the Tribunal framed the
relevant issues. To prove the claim, the Claimants presented the
evidence of Respondent No.1 (AW1/Exh.13) and examined Mr.
Kundalik Bandgar, employer of the deceased (AW2/Exh.21). In
contrast, the Appellant adduced the evidence of Mr. Anant Hadapi,
an official of RTO office, Mumbai Central (DW1/Exh.26).
8) Considering the rival evidence, the Tribunal held that the
accident occurred due to rash and negligent driving of the truck and
the M/cycle in the ratio 75:25. The deceased was earning Rs.3,200/-
per month and 1 month salary as the bonus, totaling to Rs.41,600/-
per annum. But the Tribunal took the annul income as Rs.44,800/-
(12 + 2 months bonus), deducted 1/3rd of the income towards
personal and living expenses of the deceased, applied the multiplier
of “16” and awarded Rs.4,78,000/- rounded of, as the loss of
dependency. In addition, the Tribunal awarded Rs.2000/- as funeral
expenses, Rs.5000/- as loss of consortium and Rs.3000/- as loss of
estate. Out of the total amount of Rs.4,88,000/-, the Tribunal
deducted Rs.1,22,000/- towards the 25% contributory negligence.
Thus, the Tribunal awarded Rs.3,66,000/- as compensation. Further,
the Tribunal held that the driver of the truck was holding a fake
driving licence. However, held the Respondent No.6 and Appellant
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jointly and severally liable to pay the compensation.
9) No ground has been raised in the Appeal by the Appellant
thereby challenging the findings of the Tribunal that the accident
occurred due to the contributory negligence and the negligence of the
driver of the truck and the rider of the M/cycle was in the ratio 75:25.
9.1) The Claimants too did not file a cross-objection or a
separate Appeal, mounting a challenge to the said findings of the
contributory negligence, its ratio, deduction of 1/3 rd instead of 1/4th of
the actual income towards the personal expenses of the deceased,
deduction of the 25% of the compensation amount on account of the
contributory negligence, the finding of the fake licence and for
enhancement of the compensation.
9.2) Be that as it may. In the absence of any challenge by the
Appellant, Claimants and the Legal Representatives (LRs) of the
rider of the M/cycle to the said findings of contributory negligence
and its ratio, there is no scope to re-appreciate the evidence on the
question of the said negligence.
10) Next comes the question of the award towards the loss of
the dependency. In this regard the evidence of AW1 and AW2 is that,
AW2 was working as a vegetable commission agent, Vashi Market in
New Mumbai. The deceased was working with AW2, who used to pay
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the deceased monthly Rs.3,200/- plus one month salary as Diwali
bonus. This evidence did not receive any challenge in the cross-
examination. Hence, I hold that the annual income of the deceased
was Rs.41,600/-, and not Rs.44,800/-, as held by the Tribunal.
11) As per the evidence of AW1 and the Postmortem Report
(Exh.17), the deceased was aged 30 years, but he was not in a
permanent employment. Therefore, in accordance with the decision
in National Insurance Co. Ltd. vs. Pranay Sethi and Others 1 and Sarla
Verma and others vs. Delhi Transport Corporation and another2,
40% of the net annual income of Rs.41,600/- should be added
towards the future prospects of the deceased. Since all five Claimants
were dependent on the income of the deceased, 1/4 th of the actual
yearly income should be deducted towards the personal and living
expenses of the deceased, to quantify the loss of the dependency. The
applicable multiplier is “17” not “16”, because the deceased was aged
30 years, not between 31 to 35 years. Accordingly, the loss of
dependency would be Rs.7,42,560/-. In accordance with the decision
in Magma General Insurance Co. Ltd. vs. Nanu Ram Alias Chuhru
Ram & Ors.3, the Claimants are entitled to receive Rs.48,000/- each
towards loss of ‘spousal’, ‘parental’ and ‘filial’ consortium.
1. (2017) 16 SCC 680.
2. (2009) 6 SCC 121.
3. (2018) 18 SCC 130.
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Additionally, the Claimants are entitled to get Rs.18,000/- under the
head ‘funeral expenses’ and Rs.18,000/- under the head ‘loss of
estate’. Thus, total compensation comes to Rs.10,18,560/- and the
enhancement of the compensation will be as under :-
Total compensation amount : Rs.10,18,560/-
Compensation awarded by Tribunal : - Rs. 3,66,000/-
------------------
Enhanced compensation amount : = Rs. 6,52,560/-
------------------
Enhancement of Compensation
12) Now, question is whether the Claimants are entitled for
the enhancement of the amount of compensation. Mr. Mendon, the
learned Advocate, submitted that the enhancement of compensation
and award is permissible in such Appeal by an insurance company
although the Claimant/s did not file a separate Appeal or cross-
objection for the enhancement.
12.1) Mr. Deshmukh, appointed Amicus Curiae submitted that
the Act is a beneficial and welfare legislation under which such claims
are filed for compensation on account of the injuries sustained or
deaths occurred in motor vehicular accidents. “Just Compensation” is
at the heart of the provisions thereby empowering the
Tribunal/Court to quantify and award the compensation to the
Claimants. If there is an error on the part of the Tribunal/Court in
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quantifying “just compensation” and for some reason/s, the
Claimant/s do not file Appeal or cross-objection seeking to rectify
that error and enhancement of the compensation, such Claimant/s
cannot be restricted from pointing as to how the error occurred in
quantifying the “just compensation” and it would be justifiable to
rectify that error. Otherwise, the object of the ‘beneficial legislation’
will fail. With this submissions, Mr. Deshmukh showed his unison
with the submissions by Mr. Mendon.
13) However, according to Mr. Misar, the learned Advocate,
unless there is a separate Appeal or cross-objection by the
Claimant/s, the enhancement of the compensation and award is not
permissible in such Appeal at the instance of insurance company. To
bolster this submissions, Mr. Misar relied upon following cases :-
i) Ranjana Prakash & Ors. vs. Divisional Manager & Anr. 4
therein the Division Bench of the Hon’ble Supreme Court held that,
“6. … in an appeal by the owner/insurer, the claimants will
not be entitled to seek enhancement of the compensation by
urging any new ground, in the absence of any cross-appeal or
cross-objections.
7. This principle also flows from Order 41 Rule 33 of the
Code of Civil Procedure which enables an appellate court to
pass any order which ought to have been passed by the trial
court and to make such further or other order as the case may
4. (2011) 14 SCC 639.
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require, even if the respondent had not filed any appeal or
cross-objections. This power is entrusted to the appellate
court to enable it to do complete justice between the parties.
Order 41 Rule 33 of the Code can however be pressed into
service to make the award more effective or maintain the
award on other grounds or to make the other parties to
litigation to share the benefits or the liability, but cannot be
invoked to get a larger or higher relief. …
8. Where an appeal is filed challenging the quantum of
compensation, irrespective of who files the appeal, the
appropriate course for the High Court is to examine the facts
and by applying the relevant principles, determine the just
compensation. If the compensation determined by it is higher
than the compensation awarded by the Tribunal, the High
Court will allow the appeal, if it is by the claimants and
dismiss the appeal, if it is by the owner/insurer. Similarly, if
the compensation determined by the High Court is lesser than
the compensation awarded by the Tribunal, the High Court
will dismiss any appeal by the claimants for enhancement, but
allow any appeal by owner/insurer for reduction. The High
Court cannot obviously increase the compensation in an
appeal by owner/insurer for reducing the compensation, nor
can it reduce the compensation in an appeal by the claimants
seeking enhancement of compensation.”
ii) Shriram General Insurance Co. Ltd. Vs. Surekha and
Others5. In this case, in paragraph 37 and 38 this Court observed and
held that :-
“37. The case of “Ranjana Prakash v. Divisional Manager” (supra)
5. 2020 ACJ 434.
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is also followed by this court in “United India Insurance Co. Ltd. v.
Rajani Suresh Bhore“, [(2017) 5 AIR Bom R 592]. No doubt, in
Jitendra Khimshankar Trivedi v. Kasam Daud [(2015) 4 SCC 237]
in para 13 of the judgment, the Apex Court observed that:
“(13) The tribunal has awarded Rs.2,24,000/- as against the
same, claimants have not filed any appeal. As against the
award passed by the tribunal when the claimants have not
filed any appeal, the question arises whether the income of the
deceased could be increased and compensation could be
enhanced. In terms of Section 168 of the Motor Vehicles Act,
the courts/tribunals are to pass awards determining the
amount of compensation as to be fair and reasonable and
accepted by the legal standards. The power of the courts in
awarding reasonable compensation was emphasised by this
Court in Nagappa v. Gurudayal Singh, (2003) 2 SCC 274,
Oriental Insurance Company Ltd. v. Mohd. Nasir, (2009) 6
SCC 280, and Ningamma v. United India Insurance Company
Ltd., (2009) 13 SCC 710. As against the award passed by the
tribunal even though the claimants have not filed any appeal,
as it is obligatory on the part of courts/tribunals to award just
and reasonable compensation, it is appropriate to increase the
compensation.”
38. However, after carefully going through this judgment, it
emerges that while enhancing the compensation, the Apex Court
exercised jurisdiction under Article 142 of the Constitution of
India, which a High Court does not possess. Thus, though
compensation determined by this court in the case at hand is more
than awarded by the Tribunal, this Court cannot enlarge the scope
of this appeal and cannot enhance the compensation more than
awarded by the Tribunal. However, by exercising its jurisdiction
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under Order 41, Rule 33 of the Code of Civil Procedure, this court
can only enhance the rate of interest to the extent of nine per cent
per annum from the date of filing of claim petition till realization of
the entire compensation amount.”
iii) Sangita Arya & Ors. vs. Oriental Insurance Co. Ltd. Ors. 6.
In this case the MACT held that, the deceased was aged 35 years, and
his income was Rs.1,00,000 p.a. The deceased had left behind five
dependents. Therefore, the MACT deducted 1/4th of his income
towards personal expenses, adopted the multiplier of “16” and
computed the loss of dependency at Rs.12,20,000/-.
In Appeal by the insurer, the High Court observed that
the ITRs for the years 2002-03, 2003-04 and 2004-05 showed that
the average annual income of the deceased for these three years was
Rs.52,635/-. The ITR for the year 2006-07 revealed an income of
Rs.98,500 p.a., which was almost double the income of the preceding
three years. But the High Court did not consider the ITR for the year
2006-07. Accordingly, the High Court took the average of the ITRs
for years 2002-03, 2003-04 and 2004-05, for determining the
income of the deceased at Rs.52,635 p.a., deducted 1/3rd of the
income towards personal expenses and applied the multiplier of “16”.
Thus, the loss of dependency was assessed at Rs.5,61,440. The
consortium payable to the widow was reduced by the High Court
6. (2020) 5 SCC 327.
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from Rs.20,000 (as awarded by the MACT) to Rs.10,000; the amount
awarded towards loss of love and affection to the minor daughters
was reduced from Rs.10,000 to Rs.5,000. However, it maintained
amount of Rs.5,000 awarded by the MACT towards funeral expenses.
Ultimately, the Hon’ble Supreme Court (three Judge
bench) observed that, the ITRs for the assessment years 2005-06 and
2006-07 were filed prior to the death of the deceased, which reflected
the income of approximately Rs.1,00,000 p.a. (as assessed by the
MACT). Therefore, making that income as the basis for computing
the compensation and in accordance with the decision in Pranay
Sethi (supra), deducted a ¼th income towards personal expenses and
awarded Rs.17,50,000/-. In this regard the Hon’ble Supreme Court
observed that,
“18. Even though the Claimants/Appellants herein did not file
an Appeal against the Award dated 22.12.2009 passed by the
MACT before the High Court, we deem it appropriate to
enhance the compensation by exercising our jurisdiction
under Article 142 of the Constitution of India in order to do
complete justice between the parties.”
iv) United India Insurance Co. Ltd. vs. Surekha Kisan Shirke
& Ors.7. In this case, the learned Single Judge of this Court held that,
“appellate Court cannot enhance the amount of compensation unless
7. FA No.873/2004 dt. 30/09/2021.
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the claimants file appeal or cross-objection for enhancement.” In
this regard, reliance was placed on the decisions in Ranjana Prakash
& Ors. (supra) and Sangita Arya & Ors. (supra). Further, reference
was made to the Division Bench decision of the Hon’ble Supreme
Court in Shivawwa and Anr. vs The Branch Manager National India. 8
wherein the Tribunal allowed the claim against Respondent No.1 –
insurance company, Respondent No.2 – owner and the driver.
Aggrieved, Respondent No.1 insurance company assailed the
Tribunal’s award before the High Court of Karnataka, contending
that the deceased had not travelled along with his goods in the
tractor-trailer and therefore, it could not be made liable to pay any
compensation. The High Court found merit in the contention raised
by Respondent No.1, hence, held that Respondent No.1 insurance
company could not be saddled with any liability.
The Appellants challenged the judgment of the High
Court including on the ground that the High Court failed to
appreciate the evidence on record and that the deceased was the sole
earning member of the family. The Appellants also submitted that
the quantum of compensation awarded by the Tribunal was meager
and unjustifiable and therefore, also sought enhancement of the
Tribunal’s award. While addressing the argument of the appellants
8. (2018) 5 SCC 762.
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that the Tribunal committed a manifest error in computing the
compensation amount, the Hon’ble Supreme Court, observed that,
“… we find that the appellants (claimants) did not file an
appeal for enhancement of compensation amount against that
part of the award passed by the Tribunal nor chose to file any
cross-objection in the First Appeal filed by the insurer before
the High Court. Moreover, from the judgment of the High
Court there is no indication that any attempt was made on
behalf of the appellants to ask for enhanced compensation
amount on the grounds as would have been available to the
appellants in that behalf. Significantly, in the present appeal
also, the appellants have not asked for any “relief” against that
part of the award passed by the Tribunal, regarding the
quantum of compensation. The relief claimed in this appeal is
only to set aside the decision of the High Court passed in the
First Appeal preferred by the insurer. In this backdrop, it will
not be appropriate for this Court to consider the argument
regarding the quantum of compensation at the instance of the
appellants (claimants).”
v) Choudhary Sahu (Decd.) vs. State of Bihar9 therein the
Hon’ble Supreme Court considered the provision of Order XLI, Rules
22 with 33 and held that, in absence of any cross-objection or Appeal,
findings recorded by the Court/authority below cannot be interfered
with by the Appellate Court/authority.
9. (1982) 1 SCC 232.
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Manoj 9-FA-105-2007.doc vi) Ram Pravesh Singh & Ors. vs. State of Bihar & Ors. 10
therein the Hon’ble Supreme Court observed that, any direction
given on special facts, in exercise of jurisdiction under Article 142, is
not a binding precedent.
14) Mr. Mendon, the learned Advocate for the Claimants, on
the other hand, cited following cases to accept his submission that
enhancement of compensation and award is permissible in such
Appeal by the insurer even if the Claimant/s did not file a separate
Appeal or cross-objection.
i) A.P.S.R.T.C. Rep. by its General Manager & Another vs.
M. Ramadevi and Others.11. In this case, the Tribunal awarded total
compensation of Rs.2,46,000/- taking multiplier of “12”, which the
High Court enhanced to Rs.3,55,952/- even though the Claimants did
not file a separate Appeal or cross-objection for the enhancement. In
the Appeal, the Hon’ble Supreme Court reduced the compensation to
Rs.2,60,000/- taking multiplier of “10”. In this connection reference
was made to the decision in Nagappa vs. Gurudayal Singh and Ors. 12,
paragraph 21, which reads :
“21. For the reasons discussed above, in our view, under the
M.V. Act, there is no restriction that the Tribunal/court
cannot award compensation amount exceeding the claimed
10. (2006) 8 SCC 381.
11. (2008) 3 SCC 379.
12. (2003) 2 SCC 274.
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amount. The function of the Tribunal/court is to award just
compensation which is reasonable on the basis of evidence
produced on record. Further, in such cases there is no
question of claim becoming time-barred or it cannot be
contended that by enhancing the claim there would be change
of cause of action. It is also to be stated that as provided under
sub-section (4) to Section 166, even the report submitted to
the Claims Tribunal under sub-section (6) of Section 158 can
be treated as an application for compensation under the M.V.
Act. If required, in appropriate cases, the court may permit
amendment to the claim petition.”
ii) United India Insurance Co. Ltd. vs. Kunti Binod Pande &
Ors.13. In this case, in paragraph 34, this Court observed that, ” A
Division Bench of this Court in case of National Insurance Co. Ltd.
vs. Vaishali H. Devare & Ors. 14 has held that even if there is no cross-
appeal or cross-objection preferred by the claimants, the exercise of
determining the just compensation will have to be carried out. Such
adjudication can be made even without taking recourse to Rule 33 of
Order XLI of Code of Civil Procedure.” In view thereof, in paragraphs
37 and 38 it has been observed and held as under :-
“37. In so far as the judgment of Supreme Court in case of
Ranjana Prakash & Ors. v/s. Divisional Manager and Anr.
(supra) is concerned, the said judgment has been interpreted
by this Court in various judgments already referred to
aforesaid and after considering the later judgment of the
13. (2020) 1 Bom CR 629.
14. (2013) 1 Mah LJ 411.
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Supreme Court, it is held by this Court that filing of
substantive appeal or cross-objection by the claimant for
seeking enhancement of the claims is not necessary. The
principles of law laid down by the later judgment of Supreme
Court and this Court in large number of judgments referred to
aforesaid, apply to the facts of this case. The reliance placed by
the learned counsel for the appellant on the judgment
delivered by Shri Justice G.S. Patel on 29th June, 2017 in case
of United India Insurance Company Limited v/s. Rajani
Suresh Bhore and Ors. (supra) is misplaced. The judgment of
the Supreme Court in the aforesaid judgment taking a
different view, apply to the facts of this case. I am respectfully
bound by the said judgment.
38. In my view, there is thus no embargo on this Court to
enhance the claims not awarded by the Tribunal in favour of
the original claimant. Those compensation can be awarded to
grant “just compensation” in favour of the claimant to do
complete justice in the matter. In my view, there is thus no
substance in the submission of the learned counsel for the
appellant that various judgments referred to and relied upon
by the learned counsel for the respondent nos. 1 to 4 had not
considered the provisions of Order XLI Rule 33 of the Code of
Civil Procedure, 1908. The Division Bench of this Court in
case of National Insurance Co. Ltd. v/s. Ms. Vaishali Harish
Devare and Ors. (supra) had considered the provisions of
Order XLI Rule 33 of Code of Civil Procedure in the said
judgment. In my view, since it is the statutory obligation of the
Tribunal and also the Court to do complete justice to the
parties and award “just compensation”, there is no restriction
to enhance the compensation in appropriate case even in
absence of cross-appeal or cross-objection. Appeal
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proceedings are in continuation of proceedings before
Tribunal. In my view, claimant can be permitted to pay an
additional amount of Court fees, if any on the additional
compensation, allowed by the Appellate Court on the
differential amount”.
iii) Manager, National Insurance Co. Ltd. vs. Shri Nilesh
Suresh Bhandari & Ors.15. In this case, the learned Single Judge of
this Court considered the aforesaid observations in Kunti Binod
Pande & Ors. (supra) and in paragraph 17 observed that,
“17. I am in complete agreement with the view expressed in
Kunti Pandey (supra), since it is the duty of the Court dealing
with a claimant who has incurred a disability on account of an
un-fateful event, I do not deem it fit to decline consideration
of the claim of the claimant for enhancement of compensation
in absence of any independent Appeal or cross Appeal being
filed by the claimant.”
iv) Surekha W/o Rajendra Nakhate & Ors. vs. Santosh S/o
Namdeo Jadhav & Ors.16 therein the decision of this Court in Shriram
General Insurance Co. Ltd. vs. Surekha and Others (supra) was
impugned. After considering the matter, the Hon’ble Supreme Court
(three Judge bench) observed that, the High Court, even though
agreed with the stand of the appellants that just compensation
amount ought to be Rs.49,85,376/-, declined to grant enhancement
15. 2022 SCC Online Bom 4749.
16. (2021) 16 SCC 467.
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merely on the ground that the appellants had failed to file cross-
appeal. Therefore, it has been held that, by now, it is well-settled that
in the matter of insurance claim compensation in reference to the
motor accident, the Court should not take a hyper technical approach
and ensure that just compensation is awarded to the affected person
or the claimants. As a result, the Apex Court modified the order
passed by the High Court to the effect that the compensation amount
payable to the appellants has been determined at Rs.49,85,376/-,
with interest thereon as awarded by the High Court, and allowed the
Appeal, accordingly. This decision is very recently followed by the
High Court of Kerala in Oriental Insurance Co. Ltd. vs. C. Hamza and
Others17.
v) Solapur Municipal Corporation & Anr. vs. Rupali Rahul
Pawar & Anr.18. In this case this Court considered the decisions in
A.P.S.R.T.C. (supra) and Nagappa (supra), and in paragraph 15 held
that, “It is thus well settled that the Tribunal/Court is under an
obligation to award just compensation and there is no embargo in
enhancing the compensation in the absence of appeal or cross
objection. … .” As a result, this Court enhanced the compensation of
Rs.12,58,000/- to Rs.16,06,200/-. Said decision is in line with the
17. 2025 SCC OnLine Ker 2162.
18. FA No.476/2016 dt. 29/08/2023.
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earlier decision in Kelkar and Kelkar vs. Shripad Narayan Gore And
Ors.19 therein reference was made to the decisions in Ranjana
Prakash & Ors. (supra), Nagappa (supra) and Pranay Sethi (Supra).
15) I have carefully considered the said rival submissions and
the cited decisions. In A.P.S.R.T.C. (supra), the Tribunal held that,
deceased was aged 40 years and he was getting a salary of Rs.4,000/-
p.m. and after deduction his take home pay was Rs.2,367/- and the
total emoluments was Rs.3,983/-. Applying the multiplier of “12” the
entitlement was fixed at Rs.2,16,000/-, in addition Rs.15,000/- for
non-pecuniary damages and Rs.5,000/- as consortium was awarded.
Thus the total compensation awarded was at Rs.2,46,000/- with
interest @ 12% p.a. The High Court held that the pay of the deceased
was Rs.3,536/- and not Rs.2,367/- as noted by the Tribunal. Hence, it
fixed the basic pay of Rs.3,500/- after deducting 1/3rd towards the
personal expenses. The monthly contribution was fixed at Rs.2,333/-
and the annual contribution at Rs.27,996/-. The multiplier was taken
at “12”. Accordingly, entitlement was fixed at Rs.3,35,952/- to which
was added the sum of Rs.20,000/- additionally awarded by the
Tribunal. In the Appeal, the Hon’ble Supreme Court reduced the
compensation to Rs.2,60,000/-, taking multiplier of “10”. Thus, said
amount was higher than the amount awarded by the Tribunal.
19. 2019 SCC Online Bom 4140.
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Meaning thereby the enhancement by the High Court in the Appeal
by the A.P.S.R.T.C. was partially agreed.
15.1) In the case in hand, as held above, the deceased’s net
annual income was Rs.41,600/-. Mr. Mendon, the learned Advocate
has not claimed that the deceased was earning more than that
amount nor did he request to enhance the compensation,
accordingly. In fact, his main grievance is that, no compensation was
conceived and awarded towards the future prospects, the deduction
towards personal expenses is on higher side and the multiplier taken
as “16”, is incorrect.
15.2) In the case of Pranay Sethi (supra), the Hon’ble Supreme
Court in paragraph 57 observed and held that,
“57. … To follow the doctrine of actual income at the time of
death and not to add any amount with regard to future
prospects to the income for the purpose of determination of
multiplicand would be unjust. The determination of income
while computing compensation has to include future
prospects so that the method will come within the ambit and
sweep of just compensation as postulated under Section 168 of
the Act. In case of a deceased who had held a permanent job
with inbuilt grant of annual increment, there is an acceptable
certainty. But to state that the legal representatives of a
deceased who was on a fixed salary would not be entitled to
the benefit of future prospects for the purpose of computation
of compensation would be inapposite. It is because the
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criterion of distinction between the two in that event would be
certainty on the one hand and staticness on the other. One
may perceive that the comparative measure is certainty on the
one hand and uncertainty on the other but such a perception
is fallacious. It is because the price rise does affect a self-
employed person; and that apart there is always an incessant
effort to enhance one’s income for sustenance. … We are
inclined to think that there can be some degree of difference
as regards the percentage that is meant for or applied to in
respect of the legal representatives who claim on behalf of the
deceased who had a permanent job than a person who is self-
employed or on a fixed salary. But not to apply the principle of
standardization on the foundation of perceived lack of
certainty would tantamount to remaining oblivious to the
marrows of ground reality. … .”
15.3) From the aforesaid observation it is evident that, the
compensation towards the loss of the future prospects is a mandate
of the law. It is common experience that, at times, the Claimants do
not prefer an Appeal on the ground of denial of “just compensation”.
There may be various reasons for not filing such Appeal. One of the
reasons must be the financial burden in filing the Appeal which the
Claimants may not be capable to endure because of the money they
already incurred in the litigation until they receive the compensation.
Therefore, such Claimants let the award passed in their claims
become final notwithstanding there is a scope to enhance the same.
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Manoj 9-FA-105-2007.doc 15.4) In the backdrop of the above discussion and considering
the reported decisions cited by Mr. Mendon, I hold that although the
Claimants have not filed separate Appeal or cross-objection for
enhancement of the compensation, they are entitled for enhancement
of the compensation towards the future prospect.
16) The second limb of the submissions of Mr. Misar, the
learned Advocate for the Appellant is that, Respondent No.6 expired
during the pendency of the claim and no steps have been taken by the
Claimants to implead his LRs. Therefore, enhancement of the
compensation is not possible in this Appeal. To hold this proposition,
Mr. Misar relies the decision in Smt. Sushila & Anr. vs. Rajveersingh
& Ors.20 therein Respondent No.1 – driver of the offending vehicle was
not served with the notice of the Appeal. On Application of the
Appellants/Claimants the High Court deleted the name of
Respondent No.2 – owner of the offending vehicle as he expired
during pendency of the Appeal. In this background and considering
the provisions of Order XLI, Rule 14 with Order XXII of Code of Civil
Procedure (“CPC“) and provisions of Section 155 of the Act, the
Madhya Pradesh High Court in paragraph 29 and 31 held that :-
“29. It may be noticed that an ‘estate’ cannot face any
litigation or satisfy any decree unless it is held by some owner
20. AIR 2000 MP 121.
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or his representative in his absence. There cannot be a decree
against an ‘estate’. It is, therefore, obvious that survival of
cause of action contemplated by the provision contained in
Section 155 of the aforesaid Act can only be against the legal
representative of the deceased owner and not against his
‘estate’ as such. In the circumstances, on the death of the
owner during the pendency of a lis/action, it can be continued
by bringing the legal representatives of the deceased on the
record.
31. The liability of the owner which has been determined
under the provisions of the aforesaid Act has to be discharged
by the Insurer as its liability is co-extensive with that of the
owner. The cause of action contemplated under Section 155 of
the said Act does not cease to exist so as to enforce the liability
of the owner as against the Insurer. But once a situation is
created where the liability of the owner cannot be enhanced in
his absence, the mere presence of the Insurer could be of no
avail as its liability being co-extensive with that of the owner,
it cannot be enhanced without affording an opportunity of
hearing to the heirs and legal representatives of the deceased
owner. The appeal as against the deceased owner has to be
taken to have abated in view of the failure of the appellants to
take the requisite steps as contemplated under Order XXII,
Rule 4 of the Code of Civil Procedure, 1908.”
In view thereof the Madhya Pradesh High Court held that
in the absence of the driver, the Respondent No.1 who had filed the
written statement and contested the proceedings but has not been
served with the notice of the Appeal and since the Appeal abated as
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against Respondent No.2 – owner of the offending motor vehicle, the
quantum of compensation determined by the Tribunal as payable by
that Respondent (Insurer) cannot be enhanced. Hence, it upheld the
preliminary objection raised by Respondent No.3 – Insurer and
dismissed both, the Appeal as well as the cross-objection.
17) However, Mr. Mendon, the learned Advocate for the
Claimants submitted that, the facts in Sushila & Anr. (supra) are
distinct, and pointing the same Section 155 of the Act, submitted that
although Respondent No.6 herein has expired during pendency of
the claim, in the facts, the enhancement of the compensation in this
Appeal is permissible in law. To substantiate the said suggestion, Mr.
Mendon relied upon the following decisions :-
i) Natha Singh vs. Gurdial Singh & Ors. 21. In this case, the
vehicle owner was served with the notice but he failed to attend the
Court as he was confined to bed and subsequently, he died during
pendency of the claim. The Appellant/Claimant filed an Application
to bring his LRs on record, which Application was rejected by the
Tribunal. The Respondent No.2 – insurance company filed the
written statement and took over the defence of the insured and in
that capacity, it was allowed to cross-examine the witness. Therefore,
and considering the provision of Sections 96 and 102 of the old
21. 1982 ACJ 95.
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Motor Vehicles Act of 1939, the Punjab & Haryana High Court held
that the claim application could not be dismissed only because the
Claimant failed to implead the LRs. The relevant part of paragraph 3
thereof reads thus :-
“3. Section 96 of the Act provides for the duty of the
insurers to satisfy judgments against persons insured in
respect of third party risks. It also provides that the insurance
company or the insurer to whom the notice of the bringing of
any such proceedings is given, shall be entitled to be made a
party thereto and to defend the action on any of the grounds
given therein. Section 102 of the Act provides,–
“Notwithstanding anything contained in Section 306
of the Indian Succession Act, 1925 (XXXIX of 1925),
the death of a person in whose favour a certificate of
insurance had been issued, if it occurs after the
happening of an event which has given rise to a claim
under the provisions of this Chapter, shall not be a bar
to the survival of any cause of action arising out of the
said even against his estate or against the insurer.”
ii) Oriental Insurance Co. Ltd. vs. Nanjamma & Ors. 22. In
this case, Respondent No.1-owner of the offending vehicle died
during pendency of the claim and a memo was filed by the Claimants
stating that in spite of efforts being made, the LRs of the owner could
not be ascertained. The Appellant-insurance company had not
disputed that situation. The Claimants were third party. There had
22. 2005 ACJ 1534.
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been a valid insurance policy, covering the risk. Considering these
facts in the light of Section 155 of the Act and Order XXII, Rule 4-A of
the CPC, the High Court of Karnataka held that the death of the
owner of the vehicle has not made any impact on the merits of the
case and the Appellant – insurer cannot escape from the liability on
this score. However, the Appellant – insurer was permitted to recover
the amount of compensation from the available assets of Respondent
No.1-owner as the driving licence of the driver was lapsed and it was
renewed subsequent to the accident.
iii) Bismilla Abidulla Ansari & Anr. vs. Kishorkumar N.
Shah & Anr.23, therein the first respondent in the appeal was the
owner and second respondent was the insurer of the offending
vehicle. The first respondent did not appear before the Tribunal to
contest the claim. Hence, the Tribunal proceeded ex-parte against
him. The name of the same first respondent was deleted during
pendency of the Appeal on the prayer made by the
Appellants/Claimants. At the time of hearing of the appeal, a query
was made by the Court as to whether an order of enhancement in
compensation can be passed by this Court when the appeal was
dismissed as against the owner of the vehicle . Considering the
provisions of Section 94, 95 and 96 of the old Act of 1939 and
23. (2008) 4 Mah. L.J 792.
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Sections 146, 147 and 149 of the new Act of 1988, this Court in
paragraph 17 held as under :-
“17. In the present case, the insured did not appear before
the Tribunal and did not contest the claim. In a case where the
insured appears and contests the claim, he will be certainly a
necessary party in an Appeal by the claimant for enhancement
of claim. In such a case, he may not have preferred an Appeal
but he can certainly file cross-objection in an Appeal preferred
by the claimant. However, in the present case the insured has
not chosen to contest the claim and the Tribunal proceeded
ex-parte against him. Therefore, the claim made by the
appellants in this appeal for enhancement can be certainly
considered to the extent of liability of the second respondent-
insurer as there is already a judgment delivered by the
Tribunal holding the first respondent-owner liable.”
iv) United India Insurance Co. Ltd. vs. Santro Devi & Ors. 24.
In this case the offending truck was hypothecated to the bank. The
contract of insurance was continued to be renewed by the bank in the
name of the owner for several years after his death. The widow of the
driver of the truck claimed compensation from the widow of the
owner. The Appellant-insurance company had neither pleaded
particulars of fraud nor examined any witness in support thereof.
Hence, it has been held that the Appellant-insurance company is
bound to satisfy the claim.
24. (2009) 1 SCC 558.
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Manoj 9-FA-105-2007.doc 18) Looking at the aforesaid controversy, it is necessary to
consider the provisions of Section 155 of the Act of 1988, which is
similar to Section 102 of the old Act of 1939 and reads :-
“155. Effect of death on certain causes of action. –
Notwithstanding any thing contained in Section 306 of the
Indian Succession Act, 1925 (39 of 1925), the death of a
person in whose favour a certificate of insurance had been
issued, if it occurs after the happening of an event which has
given rise to a claim under the provisions of this Chapter, shall
not be a bar to the survival of any cause of action arising out of
the said event against his estate or against the insurer.”
18.1) Rule 261 of the Maharashtra Motor Vehicles Rules, 1989
deals with Appearance and examination of parties and sub-Rule (2)
thereof provides that, “(2) If the opposite party contests the claim,
the Claims Tribunal may, and if no written statement has been filed,
shall, proceed to examine the parties to the claim and shall reduce
the result of examination to writing.” On a plane reading of this sub-
Rule (2), it is crystal clear that, its second limb acts as a mandate
against the opposite party who did not file the written statement. As
provided in Rule 276 (1) (b) of the said Rules of 1989, Order XXII,
Rules 1 to 7 (both inclusive) and 9 of the Code of Civil Procedure shall
be applicable to the proceedings before every Claims Tribunal. The
Order XXII, Rules 1, 2 and 4 (4) of C.P.C. read :-
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1. No abatement by party’s death if right to sue survives.–The
death of a plaintiff or defendant shall not cause the suit to
abate if the right to sue survives.
2. Procedure where one of several plaintiffs or defendants dies
and right to sue survives.– Where there are more plaintiffs or
defendants than one, and any of them dies, and where the
right to sue survives to the surviving plaintiff or plaintiffs
alone, or against the surviving defendant or defendants alone,
the Court shall cause an entry to the effect to be made on the
record, and the suit shall proceed at the instance of the
surviving plaintiff or plaintiffs, or against the surviving
defendant or defendants.
4. Procedure in case of death of one of several defendants or of
sole defendant.– (4) The Court whenever it thinks fit, may
exempt the plaintiff from the necessity of substituting the
legal representatives of any such defendant who has failed to
file a written statement or who, having filed it, has failed to
appear and contest the suit at the hearing; and judgment may,
in such case, be pronounced against the said defendant
notwithstanding the death of such defendant and shall have
the same force and effect as if it has been pronounced before
death took place.
18.2) As noted earlier, the Appellant was allowed to take all the
defences available to Respondent No.6 under Section 147 of the Act.
In view of the provisions of Section 155 of the Act, the death of
Respondent No.6 in this case shall not be a bar to the survival of the
cause of action against estate of Respondent No.6 or against the
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Appellant – insurer, as the Respondent No.6 died after arising of the
cause of the action for this claim. Since Respondent No.6 failed to
appear pursuant to the notice in the claim, the Claimants could have
been exempted from the necessity of substituting the LRs of
Respondent No.6, as provided in Order XXII, Rule 4 (4) of C.P.C.
Looking at the facts of the case, it appears that, the
Claimants were not aware of death of Respondent No.6. As such, they
cannot be blamed for not impleading his LRs. By not attending in the
claim proceedings, Respondent No.6 left it to the discretion of the
Tribunal to decide the claim in his absence, on its own merit and, at
the same time, let his estate exposed to the award that could have
passed in the claim. One of the purposes of Order XXII, Rule 4 (4) of
C.P.C. is to avoid unnecessary delays and complications in the legal
process when a defendant who has not actively participated in the
suit dies. It prevents the plaintiff from being penalized for the non-
participation of a defendant who essentially lost his opportunity to
context the case. Needless to state that, such claim proceedings
should be decided at the earliest. Order XXII, Rule 11 of the C.P.C.
provides that, in the application of this Order to appeals, so far as
may be, the word “Plaintiff” shall be held to include an appellant, the
word “defendant” a respondent, and the word “suit” an appeal. But
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said Rule 11 is not included in the aforesaid Rule 276 (1) (b) of the
Rules, 1989.
18.3) In Bismilla (supra), in paragraph 14, it is held that if an
Award or Judgment has been made in respect of a liability which is
required to be covered under the policy by Section 95 of the said Act
of 1939, the insurer is under obligation to satisfy the Judgment or
Award to the extent of its liability. Chapter XI of the Act of 1988 deals
with the insurance of motor vehicles against the third party risks.
Section 146 of the Act of 1988 is similar to Section 94 of the said Act
of 1939. Section 147 of the Act of 1988 lays down the requirements of
the policies and limits of liability of the insurer. Sub-Section (1) of
Section 149 of the said Act of 1988 virtually reproduces sub-Section
(1) of Section 96 with necessary modifications required to be made
on account of introduction of Section 163A of the said Act of 1988. In
paragraph 15 it is held that, “Thus, by legal fiction, Section 96 of the
said Act of 1939 and Section 149 of the said Act of 1988 make the
liability of the insurer under a contract of insurance a statutory
liability. …” Further it is held that, considering the scheme of Chapter
XI of the Act of 1988, it is apparent that if there is a Judgment
holding the insured liable to pay an amount to a third party, the
insurer has to pay the amount to the person for whose benefit the
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Judgment is delivered, subject to the liability incorporated in policy.
18.4) Section 155 and 149 of the Act of 1988 are substantive
provisions of law. In Vimla Devi & Ors. vs. National Insurance Co.
Ltd. & Ors.25, cited by Mr. Mendon, the Hon’ble Supreme Court
enunciated as under :-
“19.4. So far as Section 166 of the Act is concerned, it also
deals with payment of compensation. Section 168 of the Act
deals with award of the Claims Tribunal whereas Section 169
of the Act provides procedure and powers of the Claims
Tribunal. As has been held by this Court (Three-Judge Bench),
the claim petition filed under the Act is neither a suit nor an
adversarial lis in the traditional sense but it is a proceeding in
terms of and regulated by the provisions of Chapter XII of the
Act, which is a complete Code in itself. (See United India
Insurance Company Ltd. v. Shila Datta, (2011) 10 SCC 509).”
18.5) In view of the above discussion, the reported decisions
cited by Mr. Mendon, and submissions by Mr. Deshmukh, the
learned Amicus Curiae, I hold that even if Respondent No.6 herein
has expired during pendency of the claim and his LRs have not been
impleaded, the Claimants are entitled for the enhancement of the
compensation.
19) Now coming to the question of contributory negligence.
In the cross-examination of AW1, the Appellant conceded that the
25. (2019) 2 SCC 186.
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deceased was the pillion rider. Therefore, Mr. Mendon, the learned
Advocate submitted that the 25% deduction of the amount of the
compensation towards the contributory negligence is illegal. As noted
in Khenyei vs. New India Assurance Co. Ltd. and others 26, the case of
composite negligence is one when accident occurs and resulting
injuries and damages flow without any negligence on the part of the
claimant but as a result of the negligence on the part of two or more
persons. As held in Khenyei (supra), “In the case of composite
negligence, plaintiff/claimant is entitled to sue both or any one of the
joint tortfeasors and to recover the entire compensation as liability of
joint tortfeasors is joint and several”. Secondly, as held in Sushma vs.
Nitin Ganapati Rangole & Ors.27, in paragraph 19, “… the
contributory negligence on the part of a driver of the vehicle involved
in the accident cannot be vicariously attached to the passengers so as
to reduce the compensation awarded to the passengers or their legal
heirs as the case may be”.
19.1) The F.I.R. (Exh.14) was registered only against the driver
of the truck. No doubt, in the claim it was pleaded that, the M/cycle
was proceeding from Indapur towards Tenguni and the truck dashed
the M/cycle on its rear side. But in the evidence, AW1 stated that the
26. (2015) 9 SCC 273.
27. 2024 SCC Online SC 2584.
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M/cycle was proceeding from Solapur towards Pune ( Indapur), and
at that time the truck dashed the M/cycle (to its front). This evidence
is corroborated with the F.I.R. and the Spot Panchnama (Exh.15). In
Ningamma & Anr vs. United India Insurance Co. Ltd. 28, paragraph
25, it is held that “Undoubtedly, Section 166 of the MVA deals with
“Just Compensation” and even if in the pleadings no specific claim
was made under Section 166 of the MVA, in our considered opinion a
party should not be deprived from getting “Just Compensation” in
case the claimant is able to make out a case under any provision of
law. Needless to say, the MVA is beneficial and welfare legislation. In
fact, the court is duty bound and entitled to award “Just
Compensation” irrespective of the fact whether any plea in that
behalf was raised by the claimant or not. … .” Therefore, the
inconsistency as to the direction of the M/cycle has no effect on the
quantum of the compensation to be awarded here.
19.2) It is significant to note that, the Tribunal did not record
any reason for deduction of the 25% of the compensation amount
towards the contributory negligence. In the decision in State of
Orissa vs. Dhaniram Luhar29, in paragraph 8, the Apex Court has
observed that,
28. (2009) 13 SCC 710.
29. 2004 (5) SCC 568.
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“Even in respect of administrative orders Lord Denning M.R.
in Breen v. Amalgamated Engineering Union (1971 (1) All E.R.
1148) observed “The giving of reasons is one of the
fundamentals of good administration”. In Alexander
Machinery (Dudley) Ltd. v. Crabtree (1974 ICR 120)(NIRC) it
was observed: “Failure to give reasons amounts to denial of
justice”. Reasons are live links between the mind of the
decision-taker to the controversy in question and the decision
or conclusion arrived at”. Reasons substitute subjectivity by
objectivity. The emphasis on recording reasons is that if the
decision reveals the “inscrutable face of the sphinx”, it can, by
its silence, render it virtually impossible for the Courts to
perform their appellate function or exercise the power of
judicial review in adjudging the validity of the decision. Right
to reason is an indispensable part of a sound judicial system;
reasons at least sufficient to indicate an application of mind to
the matter before Court. Another rationale is that the affected
party can know why the decision has gone against him. One of
the salutary requirements of natural justice is spelling out
reasons for the order made; in other words, a speaking out.
The “inscrutable face of a sphinx” is ordinarily incongruous
with a judicial or quasi-judicial performance.”
19.3) In view thereof, I hold that the deduction of the 25% of
the compensation amount done by the Tribunal on account of the
contributory negligence, was erroneous. As such, the Claimants are
entitled to get the enhanced compensation, i.e., entire amount of
Rs.10,18,560/-, as quantified in the forgoing paragraph 11 of this
judgment.
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Manoj 9-FA-105-2007.doc 20) Now, dealing with the question of liability to pay the
compensation. Mr. Misar, the learned Advocate submitted that once
the Tribunal held that the driving licence was fake, it was clear that
said driver was not holding valid and effective driving licence. As
such, the Tribunal could not have held the Appellant jointly and
severally liable to pay the compensation because driving the truck
with fake licence was a fundamental breach of the subject policy
terms and conditions. Therefore, he urged to exonerate the Appellant
from that liability. To substantiate this submission Mr. Misar relied
upon the decision in United India Insurance Co. Ltd. vs. Anubai G.
Thakare & Ors.30, therein this Court held that Section 168 of the Act is
an enabling provision but it does not empower the Tribunal to issue
direction to the insurer to pay the amount of compensation, though
finding is reached that the insurer is not liable to pay such amount on
account of fundamental breach of the terms of insurance policy.
20.1) In the alternative, Mr. Misar stated that, considering the
settled law, the impugned Order ‘to pay jointly and severally’ may be
substituted with the Order ‘to pay and recover’. In fact, it is the main
ground of the Appeal.
21) In reply, Mr. Mendon, submitted that the Appellant has
failed to prove that the subject driving licence was fake. Secondly,
30. 2008 (1) Mah.L.J. 73.
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that there is no evidence that Respondent No.6 was aware of the said
fact and yet, he allowed the driver to drive the offending truck. As
such, this is not a case of fundamental breach of the policy terms and
condition. On this premise, Mr. Mendon claimed that the impugned
Order ‘to pay jointly and severally’, is correct. To bolster this
submission he cited the decision in Pepsu Road Transport Corp vs.
National Insurance Co. Ltd.31 and Rishi Pal Singh vs. New India
Assurance Co. Ltd. & Ors.32. But the facts therein are distinct.
22) In the case of Pappu and Ors. vs. Vinod Kumar Lamba
and Anr.33, Respondent No.1 – the owner of the offending vehicle
merely raised a vague plea in the written statement that the offending
vehicle DIL-5955 was being driven by a person having valid driving
licence. He did not disclose the name of the driver and his other
details. Besides, Respondent No.1 did not enter the witness box or
examine any witness in support of this plea. Respondent No.2 –
Insurance Company in the Written Statement had plainly refuted
that plea and also asserted that the offending vehicle was not driven
by an authorized person and having valid driving licence.
Respondent No.1 – owner of the offending vehicle did not produce
any evidence except a driving licence of one Joginder Singh, without
31. (2013) 10 SCC 217.
32. 2022 SCC Online SC 2119.
33. (2018) 3 SCC 208.
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any specific stand taken in the pleadings or in the evidence that the
same Joginder Singh was, in fact, authorized to drive the vehicle in
question at the relevant time. Therefore, the Tribunal allowed the
application in part and it absolved the insurance company by
dismissing the claim petition against it. The High Court affirmed the
view taken by Tribunal. In this background the Hon’ble Supreme
Court held that,
“… Merely producing a valid insurance certificate in respect of
the offending Truck was not enough for the respondent No.1
to make the Insurance Company liable to discharge his
liability arising from rash and negligent driving by the driver
of the vehicle. The Insurance Company can be fastened with
the liability on the basis of a valid insurance policy only after
the basic facts are pleaded and established by the owner of the
offending vehicle – that the vehicle was not only duly insured
but also that it was driven by an authorised person having a
valid driving licence. Without disclosing the name of the
driver in the Written Statement or producing any evidence to
substantiate the fact that the copy of the driving licence
produced in support was of a person who, in fact, was
authorized to drive the offending vehicle at the relevant time,
the owner of the vehicle cannot be said to have extricated
himself from his liability. The Insurance Company would
become liable only after such foundational facts are pleaded
and proved by the owner of the offending vehicle.”
However, to subserve the ends of justice, it was directed
that the Insurer shall pay the claim amount awarded by the Tribunal
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to the appellants in the first instance, with liberty to recover the same
from the owner of the vehicle in accordance with law.
22.1) In the case of Nirmala Kothari vs. United India Insurance
Co. Ltd.34, the Hon’ble Supreme Court observed that., ” … In the case
of United India Insurance Co. Ltd. vs. Lehru & Ors. a two Judge
Bench of this court has taken the view that the Insurance Company
cannot be permitted to avoid its liability on the ground that the
person driving the vehicle at the time of the accident was not duly
licenced. It was further held that the willful breach of the conditions
of the policy should be established. … ” In paragraph 10 thereof, the
Hon’ble Supreme Court observed that, “… It has been categorically
held in the case of National Insurance Co. Ltd vs. Swaran Singh &
Ors.35 that,
110. (iii)…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 licenced driver or one who was not
disqualified to drive at the relevant time.”
34. (2020) 4 SCC 49.
35. (2004) 3 SCC 297.
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Manoj 9-FA-105-2007.doc 22.2) In the case in hand, the evidence of DW1 - Anant Hadapi
indicates that at the relevant time he was working in the licence
Section of the RTO Office, Mumbai. He deposed that, as per the
Office record, Driving Licence No. MH-01-89-C-1472 was issued in
the name of Mr. Manojkumar Omkar Deshwali on 27/06/1989. In
this regard DW1 referred the “Licence Extract (Exh.27)”. DW1
deposed that once such licence was issued with the given number, no
second licence is issued with the same number. When confronted
with the photocopy of the subject licence (Article “Z”), DW1 deposed
that the said licence is not the licence issued by his Office.
22.3) In view of the said evidence the Tribunal held that DW1
deposed that the licence (Article “Z”) is a fake one as much as no like
licence was issued by the RTO Office and the licence (Exh.27) was
issued in the name of Mr. Manojkumar Omkar Deshwali. It is noticed
that, similar photocopy of the licence was produced by the Claimants
below the list (Exh.7). Thus, it is evident that the Investigation
Officer supplied the same licence copy to the Claimants. It is not the
case that immediately after the accident the driver of the truck
and/or Respondent No.6 went to the Investigation Officer/Police and
informed about the subject driving licence and the background in
which Respondent No.6 had appointed the driver of the offending
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truck as his driver. As such, the Tribunal rightly held that the licence
was fake. In the cross-examination DW1 admitted that the licence
issued in 1989 was expired on 26/07/1992 and it was renewed from
23/09/1992 to 26/09/1995 (vide Exh.27). This fact indicates that on
the date of the accident, the subject driving licence was also not valid.
In the backdrop, the Appellant is not liable to pay the compensation
amount workout above. However, it cannot be ignored that the
Claimants are third party to the policy. They are poor. The deceased
died at young age. Therefore, and in accordance with the decisions in
Pappu and Ors. (supra), Nirmala Kothari (supra) and Swaran Singh
& Ors. (supra), it would be appropriate that the Appellant shall pay
the compensation amount of Rs.10,18,560/- to the Claimants in the
first instance, with liberty to recover the same from the owner of the
vehicle in accordance with law.
22.4) The Claimants are entitled to receive some interest on the
compensation amount. The claim was filed on 27/08/1996. The
Tribunal held that a keen interest was shown by the Claimants to
prosecute the claim. Yet, awarded the interest from 01/02/1999. No
reason is recorded for not awarding the interest from the date of
filing the claim. Needless to state that an insurer is liable to pay the
“just compensation” immediately after the accident. However, the
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Tribunal did not consider what difficulties the Claimants widow,
minor children and aged mother must have faced after the sudden
death of the sole earning member. Therefore, I hold that the
Claimants are entitled to get the interest at the rate of 7.5% per
annum from the date of filing of the claim. To fortify this conclusion I
have considered the following observation of the Apex Court in Abati
Bezbaruah vs. Dy. Director General Geological Survey of India and
Another36, in paragraph 18 that,
“… No rate of interest is fixed under Section 171 of the Motor
Vehicles Act, 1988. Varying rates of interest are being awarded
by Tribunals, High Courts and the Supreme Court. Interest
can be granted even if claimant does not specifically plead for
the same as it is consequential in the eye of law. Interest is
compensation for forbearance or detention of money and that
interest being awarded to a party only for being kept him out
of the money which ought to have been paid to him. No
principle could be deduced nor any rate of interest can be
fixed to have a general application in motor accident claim
cases having regard to nature of provision under Section 171
giving discretion to Tribunal in such matter. ….”
23) The upshot of the above discussion is that, despite the
claimants were entitled for compensation towards the loss of the
future prospects, the Tribunal did not award the same. The deceased
was not responsible for the cause or the contributory negligence
36. (2003) 3 SCC 148.
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behind the accident. However, and without recording any reason, the
Tribunal deducted the 25% of the compensation amount payable to
the Claimants. The Claimants diligently prosecuted the claim.
Nevertheless, the interest on the award amount was granted from
01/02/1999, without recording any reason. This resulted in denying
the “just compensation” or say, awarding lesser compensation, which
is erroneous. Therefore, although the Claimants have not filed
separate Appeal or cross-objection, they are entitled to the
compensation of Rs.10,18,560/- by way of the enhancement. Lastly,
it was proved by the Appellant that the driving licence in question
was not only fake but also invalid. Therefore, the contention of the
Appellant was acceptable that this is a fit case to pass the ‘pay and
recover order’. Yet, the Tribunal held the Appellant ‘jointly and
severally liable’ to pay the compensation amount, which is not
correct. In view of the said infirmities, the impugned Judgment and
Award warranted an interference to modify the same. Thus, the
Appeal is liable to be disposed of, accordingly.
23.1) Hence, following Order is passed.
(a) The impugned Judgment and Award dated
13/10/2006, in Application No.2935 of 1996, passed by
the Motor Accident Claims Tribunal, Mumbai is
modified.
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(b) Appellant - The United India Insurance Company
Limited is directed to pay the Claimants the
compensation of Rs.10,18,560/- (inclusive of no fault
liability) together with interest thereon at the rate of
7.5% per annum from the date of filing the Claim
Petition, i.e, 27/08/1996 till its realisation.
(b-1) The Appellant is at liberty to recover the compensation
amount of Rs.10,18,560/- alongwith the interest, from
the available assets of the deceased Respondent No.6,
filing an execution application based on this Judgment
and Order/ modified Award.
(c) The parties to bear their own costs.
(d) The Appellant is directed to comply with this Judgment
within a period of four months from today, by
depositing the amount in the Tribunal.
(e) On deposit of the amount, the Tribunal shall
immediately inform about the deposit to the Claimants.
(f) The amount deposited shall be apportioned amongst
the Claimants as directed by the Tribunal.
(g) The Claimants are permitted to withdraw the amount
from the Tribunal, subject to payment of a deficit Court
fee, if any, towards the enhanced compensation.
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(h) The amount deposited in the Tribunal shall not be
invested for a period of eight weeks from the date of the
deposit. In the event the amount is not withdrawn
within a period of eight weeks from the date of deposit,
the same shall be invested by the Tribunal, passing
appropriate directions.
(i) The Appellant – insurance company will be entitled to
adjustment of the amount against the already paid
under the impugned Order.
(j) Appeal is disposed of in aforesaid terms.
(k) Record and Proceedings of the Tribunal be immediately
returned.
(SHYAM C. CHANDAK, J.)
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