UNITED INDIA INSURANCE CO.LTD v. KADVIBEN UDABHAI RATHWA & Anr.

Judgment

(Per: HONOURABLE THE CHIEF JUSTICE) 1 These   are   cases   of   permanent   disablement and death of one person due to accident caused ============================================== Whether Reporters of Local Papers may be allowed to see the Judgment? FA/1683/2005 JUDGMENT when the driver lost control of the vehicle. Claimants   suffering   permanent   disablement filed   applications   under   Section   140   of   the Motor   Vehicles   Act,   1988   (hereinafter   `the M.V. Act') and in case of death of one of the occupants   of   the   vehicle,   legal   heirs preferred   claims   both   under   Section   140   and 166 of the M.V. Act.   These applications were opposed   by   the   Insurance   Company   on   grounds that the claimants were gratuitous passengers travelling   in   a   goods   vehicle,   they   did   not suffer permanent disability, their names were not in the F.I.R./charge­sheet and nexus with the accident and injuries was not established. However, the Tribunal recording the finding of involvement of the vehicle and injuries to the claimants resulting from the accident, brushed aside   the   defences   of   the   Insurance   Company, holding   that   they   could   be   decided   later   on merits.     Accordingly   claimants   were   awarded compensation.

2. Aggrieved   by   these   awards,   Insurance FA/1683/2005 JUDGMENT Company   preferred   appeals   to   this   Court. Finding   unable   to   agree   with   the   two   Single Bench   judgments   of   this   Court   in  New   India Assurance Co. Ltd. Vs. Mithakhan  Dinakhan  Notiyar  (1995(2) GLR 1111)  rendered   by   J.M.   Panchal   J.   and Mahendrakumar  Kalyanjibhai  Vs. Haresh  Bipinchandra  Pathak (1998(2) GLR 1199) by M.S. Shah J., learned Single Judge   (Coram:   D.H.  Waghela  J.),   after considering   various   provisions   of   the   M.V. Act, recorded in paragraph­7 that: “In   light   of   the   above   discussion,   I   humbly   find   myself   unable   to subscribe to the view taken by this Court (Coram:  J.M. Panchal, J.) in 1995 (2) GLR 1111 and (Coram: M.S. Shah, J.) in 1998 (2) GLR 1199 and propose to refer the matter to a larger bench under Rule 5 (1) of the Gujarat High Court Rules, 1993 with a request to have the appeals listed before a Division Bench or, if thought fit, considering the possibility of dissent, to a larger bench as expeditiously as possible. It is  important to have the decision of a larger bench at the earliest in view of pendency of thousands and thousands of claim petitions in the State, the awards in which may be carried in appeal to this Court and the possibility of the procedure being adopted at present by the Claims Tribunal being held to be vitiated. The office shall place this matter before the Hon'ble the Chief Justice for appropriate orders.”

3. This   order   was   passed   on   21.12.2005, but   it   was   not   brought   to   the   notice   of   the Division Bench (Coram: Bhawani Singh, C.J. and FA/1683/2005 JUDGMENT Smt. Abhilasha Kumari J.) while deciding First Appeal No.133 of 2006  (New India Assurance co. Ltd. Vs. Babubhai  Purshottambhai  Harijan  and others)  on 24.01.2006. Therefore,   it   was   considered   desirable   to constitute a Larger Bench.  This is how these matters are before this Full Bench.

4. The question advanced consideration   is   `whether   application   under Section 140 can lie independently or has to be filed with application under Section 166'.  In other words, whether in absence of application under   Section   166,   application   under   Section 140 is maintainable.  If it is held that it is maintainable,   Tribunal   should   allow   the Insurance Company to raise all defences while dealing with application under Section 140 as if it is under Section 166.

5. Shri Vibhuti Nanavati, learned counsel for the appellant, contended that application under   Section   140   is   not   maintainable independent of Section 166, it is interim in FA/1683/2005 JUDGMENT nature   and   compensation   has   to   be   adjusted against   the   award   passed   on   merits   under Section 166.  It is also contended that while deciding   the   application   under   Section   140, defences available to Insurance Company can be raised   before   the   Tribunal.     In   case application under Section 140 is maintainable independent of Section 166, the same be tried on merits giving opportunity to raise defences available   to   it   and   dispose   of   the   same, otherwise, Insurance Company will be fastened with   liability   without   being   heard   in   the matter.     With   a   view   to   support   his submissions, reliance is placed on Bishan Devi and others Vs. Sirbaksh Singh and another (AIR 1979 SC 1862), Shivaji Dayanu Patil and another Vs. Smt. Vatschala Uttam More (AIR 1991 SC   1769),   National   Insurance   Co.   Ltd.   Vs.  Jethu  Ram   and   others (1998   ACJ   921),   United   India   Insurance   Co.   Ltd.   Vs.  Maganlal Hirabhai Patel and others (1999 ACJ 268), New India Assurance Co. Ltd. Vs.  Dinanath  Agrawala  and others (AIR 2000  Orissa  40), New India   Assurance   Co.   Ltd.   Vs.  Sita  Bai  and   others   (2000   ACJ   40), Andhavarapu  Kamaraju  Vs.  Thammineni  Seetharam  and   others FA/1683/2005 JUDGMENT (2001 ACJ 787), The Oriental Insurance Co. Ltd. Vs. Hansrajbhai V. Kodala  (AIR   2001   SC   1832),   Oriental   Insurance   Co.   Ltd.   Vs.   B. Lakshmamma and others (2002 ACJ 670), New India Assurance Co. Ltd. Vs. Asha Rani and others (AIR 2003 SC 607), Deepal Girishbhai Soni  and others Vs. United Insurance Co. Ltd. (2004(2) GLR 1597) and  National Insurance Co. Ltd. Vs.  Bommithi  Subbhayamma  and others (2000 ACJ 721).

6. Learned M.T.M. Hakim, learned counsel for   the   respondents,   contended   that application under Section 140 is maintainable independently   of   application   under   Section

166.  They can file application under Section 140 alone and may not file application under Section 166.  They may file applications under Section   140   and   Section   166   simultaneously. In   application   under   Section   140,   Insurance Company cannot seek trial of defences as if it is   application   under   Section   166.     However, when   applications   are   preferred   under   both Sections,   no   fault   compensation   awarded   in application under Section 140 can be adjusted against   compensation   awarded   under   Section FA/1683/2005 JUDGMENT

166.   Where no fault compensation is awarded against   the   Insurance   Company,   it   can   seek reimbursement from the owner but there is no reimbursement from the claimant.   Reliance is placed on Shivaji Dayanu Patil and another Vs. Vatschala Uttam More (1991 ACJ 777: AIR 1991 SC 1769),  National Insurance Co. Ltd.   Vs.  Thaglu  Singh   and   others   (1995   ACJ   248),   New   India Assurance Co. Ltd., Ahmedabad Vs.  Mithakhan  Dinakhan Notiyar & others   (1995(2)   GLR   1111),   New   India   Assurance   Co.   Ltd.   Vs. Bhajnoo and another (1996 ACJ 367), Mahendrakumar Kalyanjibhai Vs. Haresh Bipinchandra  Pathan  and another (1998(2) GLR 1199, New   India   Assurance   Co.   Ltd.   Vs.   Dinanath  Agrawalla  and   others (2000 ACJ 525: AIR 2000 Orissa 40), Oriental Insurance Co. Ltd. Vs. Sarju Ram and others (2002 ACJ 177), New India Assurance Co. Ltd. Vs.  Fida  Hussain  and   another   (2003   ACJ   1048)   and   New   India Assurance co. Ltd. Vs. Babubhai Purshottambhai Harijan and others

(First Appeal No.133 of 2006) decided on 24.01.2006.

7. Considering   the   question,   it   is relevant   to   quote   some   relevant   statutory provisions of the M.V. Act:­ CHAPTER X FA/1683/2005 JUDGMENT Liability without fault in certain cases. 140 Liability to pay compensation in certain cases on the principle of no fault- (1) Where death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or disablement in accordance with the provisions of this section. (2) (3) (4) A claim for compensation under sub-section (1) shall not be defeated by reason of any wrongful act, neglect or default of the person in respect of whose death or permanent disablement the claim has been made nor shall the quantum of compensation recoverable in respect of such death or permanent disablement be reduced on the basis of the share of each person in the responsibility for such death or permanent disablement. (5) Notwithstanding anything contained in sub-section (2) regarding death or bodily injury to any person, for which the owner of the vehicle is liable to give compensation for relief, he is also liable to pay compensation under any other law for the time being in force. Provided that the amount of such compensation to be given under any other law shall be reduced from the amount of compensation payable under this section or under section 163A.

141. Provisions as to other right to claim compensation for death or permanent disablement- (1) The right to claim compensation under section 140 in respect of death or permanent disablement of any person shall be in addition to any other right, except the right to claim under the scheme referred to in section 163A (such other right hereafter in this section referred to as the right on the principle of fault) to claim compensation in respect thereof under any other provision of this Act or of any other law for the time being in force. FA/1683/2005 JUDGMENT (2) A claim for compensation under section 140 in respect of death or permanent disablement of any person shall be disposed of as expeditiously as possible and where compensation is claimed in respect of such death or permanent disablement under section 140 and also in pursuance of any right on the principle of fault, the claim for compensation under section 140 shall be disposed of as aforesaid in the first place. (3) Notwithstanding anything contained in sub-section (1), where in respect of the death or permanent disablement of any person, the person liable to pay compensation under section 140 is also liable to pay compensation in accordance with the right on the principle of fault, the person so liable shall pay the first-mentioned compensation and- a) if the amount of the first-mentioned compensation is less than the amount of the second-mentioned compensation, he shall be liable to pay (in addition to the first- mentioned compensation) only so much of the second-mentioned compensation as is equal to the amount by which it exceeds the first mentioned compensation; (b) if the amount of the first-mentioned compensation is equal to or more than the amount of the second-mentioned compensation, he shall not be liable to pay the second-mentioned compensation.

142. Permanent disablement: For the purpose of this Chapter, permanent disablement of a person shall be deemed to have resulted from an accident of the nature referred to in sub-section (1) of section 140 if such person has suffered by reason of the accident, any injury or injuries involving:- (a) permanent privation of the sight of either eye or the hearing of either ear, or privation of any member or joint; or (b) destruction or permanent impairing of the powers of any member or joint; or (c) permanent disfiguration of the heard or face.

144. Overriding effect: FA/1683/2005 JUDGMENT The provisions of this Chapter shall have effect notwithstanding anything contained in any other provision of this Act or of any other law for the time being in force. CHAPTER XI. INSURANCE OF MOTOR VEHICLES AGAINST THIRD PARTY RISKS

145. Definitions: In this Chapter,- (a) (b) (c) “liability”, wherever used in relation to the death of or bodily injury to any person, includes liability in respect thereof under section 140; (d) (e) (f) (g)

146. 147. 148.

149. Duty of insurers to satisfy judgments and awards against persons insured in respect of third party risks- (1) If, after a certificate of insurance has been issued under sub-section (3) of section 147 in favour of the person by whom a policy has been effected, judgment or award in respect of any such liability as is required to be covered by a policy under clause (b) of sub-section (1) of section 147 (being a liability covered by the terms of the policy) or under the provisions of section 163A is obtained against any person insured by the policy, then, notwithstanding that the insurer may be entitled to avoid or cancel or may have avoided or cancelled the policy, the insurer shall, subject to the provisions of this section, pay to the person entitled to the benefit of the decree any sum not exceeding the sum assured payable thereunder, as if he were the judgment debtor, in respect of the liability, FA/1683/2005 JUDGMENT together with any amount payable in respect of costs and any sum payable in respect of interest on that sum by virtue of any enactment relating to interest on judgments. (2) No sum shall be payable by an insurer under sub- section (1) in respect of any judgment or award unless, before the commencement of the proceedings in which the judgment or award is given, the insurer had notice through the Court or, as the case may be, the Claims Tribunal of the bringing of the proceedings, or in respect of such judgment or award so long as execution is stayed thereon pending an appeal; and an insurer to whom notice of the bringing of any such proceedings is so given shall be entitled to be made a party thereto and to defend the action on any of the following grounds, namely:- (a) that there has been a breach of a specified condition of the policy, being one of the following conditions, namely:- (i) a condition excluding the use of the vehicle- (a) for hire or reward, where the vehicle is on the date of the contract of insurance a vehicle not covered by a permit to ply for hire or reward, or (b) for organised racing and speed testing, or (c) for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle, or without side-car being attached where the (d) vehicle is a motor cycle; or (ii) a condition excluding driving by a named person or persons or by any person who is snot duly licensed, or by any person who has been disqualified for holding or obtaining a driving license during the period of disqualification; (iii)a condition excluding liability for injury caused or contributed to by conditions of war, civil war, riot or civil commotion; or (b) that the policy is void on the ground that it was obtained by the non-disclosure of a material or by a representation of fact which was false in some material particular. FA/1683/2005 JUDGMENT (3) xxx (4) (5) (6) (7) Where a certificate of insurance has been issued under sub-section (3) of section 147 to the person by whom a policy has been effected, so much of the policy as purports to restrict the insurance of the persons insured thereby by reference to any condition other than those in clause (b) of sub- section (2) shall, as respects such liabilities as are required to be covered by a policy under clause (b) of sub-section (1) of section 147, be of no effect: Provided that any sum paid by the insurer towards the discharge of any liability of any person which is covered by the policy by virtue only of this sub-section shall be recoverable by the insurer from that person. If the amount which an insurer becomes liable under this section to pay in respect of a liability incurred by a person insured by a policy exceeds the amount for which the insurer would, apart from the provisions of this section, be liable under the policy in respect of that liability, the insurer shall be entitled to recover the excess from the person. No insurer to whom the notice referred to in sub- section (2) or sub-section (3) has been given shall be entitled to avoid his liability to any person entitled to the benefit of any such judgment or award as is referred to in sub-section (1) or in such judgment as is referred to in sub-section (2) or in the corresponding law of the reciprocating country, as the case may be. Explanation:  - For the purposes of this section, “Claims Tribunal” means a Claims Tribunal constituted under section 165 and “award” means an award made by that Tribunal under section 168.” 150 to 160 xxx xxx xxx

161. Special provisions as to compensation in case of hit and run motor accident.- (1) (a) For the purposes of this section, section 162 and section 163 - “grievous hurt” shall have the same meaning as in the Indian Penal Code, 1860 (45 of 1860); (b) “hit and run motor accident: means an accident FA/1683/2005 JUDGMENT arising out of the use of a motor vehicle or motor vehicles the identity whereof cannot be ascertained in spite of reasonable efforts for the purpose; (c) “scheme” means the scheme framed under section 163. (2) (3) (a) (b) (4) Notwithstanding anything contained in the General Insurance Business (Nationalization) Act, 1972 (57 of 1972) or any other law for the time being in force or any instrument having the force of law, the General Insurance Corporation of India formed under section 9 of the said Act and the insurance companies for the time being carrying on general insurance business in India shall provide for paying in accordance with the provisions of this Act and the scheme, compensation in respect of the death of, or grievous hurt to persons resulting from hit and run motor accidents. Subject to the provisions of this Act and the scheme, there shall be paid as compensation- in respect of the death of any person resulting from a hit and run motor accident, a fixed sum of twenty-five thousand rupees; in respect of grievous hurt to any person resulting from a hit and run motor accident, a fixed sum of twelve thousand and five hundred rupees. The provisions of sub-section 91) of section 166 shall apply for the purpose of making applications for compensation under this section as they apply for the purpose of making applications for compensation referred to in that sub-section.

162. Refund in certain cases of compensation paid under section 161.- (1) The payment of compensation in respect of the death of, or grievous hurt to, any person under section 161 shall be subject to the condition that if any compensation (hereafter in this sub0section referred to as the other compensation) or other amount in lieu of or by way of satisfaction of a claim for compensation is awarded or paid in respect of such death or grievous hurt under any other provision of this Act or any other law or otherwise so much of the other compensation or other amount aforesaid as is equal to the compensation paid under section 161 shall be refunded to the insurer. (2) Before awarding compensation in respect of an accident involving the death of, or bodily injury to, any person arising out of the use of a motor FA/1683/2005 JUDGMENT vehicle or motor vehicles under any provision of this Act (other than section 161) or any other law, the Tribunal, Court or other authority awarding such compensation shall verify as to whether in respect of such death or bodily injury compensation has already been paid under section 161 or an application for payment of compensation is pending under that section, and such Tribunal, Court or other authority shall - (a) (b) if compensation has already been paid under section 161, direct the person liable to pay the compensation awarded by it to refund to the insurer, so much thereof as is required to be refunded in accordance with the provisions of sub- section (1); if an application for payment of compensation is pending under section 161 forward the particulars as to the compensation awarded by it to the insurer. Explanation.- For the purpose of this sub- section, an application for compensation under section 161 shall be deemed to be pending- (i) if such application has been rejected, till the date of the rejection of the application, and (ii) in any other case, till the date of payment of compensation in pursuance of the application.

163. Scheme for payment of compensation in case of hit and run motor accidents.- (1) (2) (a) The Central Government may, by notification in the Official Gazette, make a scheme specifying, the manner in which the scheme shall be administered by the General Insurance Corporation, the form, manner and the time within which applications for compensation may be made, the officers or authorities to whom such applications may be made, the procedure to be followed by such officers or authorities for considering and passing orders on such applications, and all other matters connected with, or incidental to, the administration of the scheme and the payment of compensation. A scheme made under sub-section (1) may provide that- a contravention of any provision thereof shall be punishable with imprisonment for such term as may be specified but in no case exceeding three months, or with fine which may extend to such amount as may be specified but in no case exceeding five hundred FA/1683/2005 JUDGMENT rupees or with both; (b) (c) the powers, functions or duties conferred or imposed on any officer or authority by such scheme may be delegated with the prior approval in writing of the Central government, by such officer or authority to any other officer or authority; any provision of such scheme may operate with retrospective effect from a date not earlier than the date of establishment of the Solatium Fund under the Motor Vehicles Act, 1939 (4 of 1939) as it stood immediately before the commencement of this Act: Provided that no such retrospective effect shall be given so as to prejudicially affect the interests of any person who may be governed by such provision. 163A. Special provisions as to payment of compensation on structured formula basis.- (1) Notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle or the authorized insurer shall be liable liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be. Explanation.- For the purposes of this sub- section, “permanent disability” shall have the same meaning and extent as in the Workmen's Compensation Act, 1923 (8 of 1923). (2) In any claim for compensation under sub-section 91), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person. (3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from to time amend the Second Schedule. 163B. Option to file claim in certain cases.- Where a person is entitled to claim compensation under section 140 and section 163A, he shall file the claim under either of the said sections and not FA/1683/2005 JUDGMENT under both. CHAPTER XII CLAIMS TRIBUNALS

165. Claims Tribunals - (1) A State Government may, by notification in the Official Gazette, constitute one or more Motor Accidents Claims Tribunals (hereafter in this Chapter referred to as Claims Tribunal) for such area as may be specified in the notification for the purpose of adjudicating upon claims for compensation in respect of accidents involving the death of, or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both. Explanation.- For the removal of doubts, it is hereby declared that the expression “claims for compensation in respect of accidents involving the death of or bodily injury to persons arising out of the use of motor vehicles” includes claims for compensation under section 140 and section 163A.”

166. Application for compensation.- (1) An application for compensation arising out of an accident of the nature specified in sub-section (1) of section 165 may be made- (a) (b) (c) (d) Provided that..... (2) Every application under sub-section (1) shall be made, at the option of the claimant, either to the Claims Tribunal having jurisdiction over the area in which the accident occurred or to the Claims Tribunal within the local limits of whose jurisdiction the claimant resides or carries on business or within the local limits of whose jurisdiction the defendant resides, and shall be in such form and contain such particulars as may be prescribed: FA/1683/2005 JUDGMENT Provided that where no claim for compensation under section 140 is made in such application, the application shall contain a separate statement to that effect immediately before the signature of the applicant. (3) (4) The Claims Tribunal shall treat any report of accidents forwarded to it under sub-section (6) of section 158 as an application for compensation under this Act.

168. Award of the Claims Tribunal- On receipt of an application for compensation made under section 166, the Claims Tribunal shall, after giving notice of the application to the insurer and after giving the parties (including the insurer) an opportunity of being heard, hold an inquiry into the claim or, as the case may be, each of the claims and, subject to the provisions of section 162 may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom compensation shall be paid and in making the award the Claims Tribunal shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them, as the case may be: Provided that where such application makes a claim for compensation under section 140 in respect of the death or permanent disablement of any person, such claim and any other claim (whether made in such application or otherwise) for compensation in respect of such death or permanent disablement shall be disposed of in accordance with the provisions of Chapter X. (2) (3)

169. Procedure and powers of Claims Tribunals- (1) In holding any inquiry under section 168, the Claims Tribunal may, subject to any rules that may be made in this behalf, follow such summary procedure as it thinks fit. FA/1683/2005 JUDGMENT (2) The Claims Tribunal shall have all the powers of a Civil Court for the purpose of taking evidence on oath and of enforcing the attendance of witnesses and of compelling the discovery and production of documents and material objects and for such other purposes as may be prescribed; and the Claims Tribunal shall be deemed to be a Civil Court for all the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974). (3) Subject to any rules that may be made in this behalf, the Claims Tribunal may, for the purpose of adjudicating upon any claim for compensation, choose one or more persons possessing special knowledge of and matter relevant to the inquiry to assist it in holding the inquiry.

170. Impleading insurer in certain cases:- Where in the course of any inquiry, the Claims Tribunal is satisfied that- (a) there is collusion between the person making the claim and the person against whom the claim is made, or (b) the person against whom the claim is made has failed to contest the claim, it may, for reasons to be recorded in writing, direct that the insurer who may be liable in respect of such claim, shall be impleaded as a party to the proceeding and the insurer so have, without thereupon impleaded shall prejudice to the provisions contained in sub- section (2) of section 149, the right to contest the claim on all or any of the grounds that are available to the person against whom the claim has been made.”

171. Award of interest where any claim is allowed.- Where any Claims Tribunal allows a claim for compensation made under this Act, such Tribunal may direct that in addition to the amount of compensation simple interest shall also be paid at such rate and from such date not earlier than the date of making the claim as it may specify in this behalf.

173. Appeals.- FA/1683/2005 JUDGMENT (1) Subject to the provisions of sub-section (2) any person aggrieved by an award of a Claims Tribunal may, within ninety days from the date of the award, prefer an appeal to the High Court: Provided that no appeal by the person who is required to pay any amount in terms of such award shall be entertained by the High Court unless he has deposited with it twenty-five thousand rupees or fifty per cent of the amount so awarded, whichever is less, in the manner directed by the High Court: Provided further that the High Court any entertain the appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal in time. (2) No appeal shall lie against any award of a Claims Tribunal if the amount in dispute in the appeal is less than ten thousand rupees.

175. Bar on jurisdiction of Civil Courts- Where any Claims Tribunal has been constituted for any area, no Civil Court shall have jurisdiction to entertain any question relating to any claim for compensation which may be adjudicated upon by the Claims Tribunal for that area, and no injunction in respect of any action taken or to be taken by or before the Claims Tribunal in respect of the claim for compensation shall be granted by the Civil Court.

176. Power of State Government to make rules- A State Government may make rules for the purpose of carrying into effect the provisions of sections 165 to 174, and in particular, such rules may provide for all or any of the following matters, namely- (a) the form of application for claims for compensation and the particulars it may contain, and the fees, if any, to be paid in respect of such application; (b) the procedure to be followed by a Claims Tribunal in holding an inquiry under this Chapter; (c) the powers vested in a Civil Court which may be exercises by a Claims Tribunal; FA/1683/2005 JUDGMENT (d) the form and the manner in which and the fees (if any) on payment of which an appeal may be preferred against an award of a Claims Tribunal; and (e) any other matter which is to be, or may be, prescribed. The Gujarat Motor Vehicles Rules, 1989: Chapter X Claims Tribunals

211. Procedure regarding compensation arising out of accidents.- (1) (2) (3) (4) An application for compensation under sub-section (1) of section 166 shall be made to the Claims Tribunal in Form Comp. A. and shall contain the particulars specified in that form. Every such application shall be sent to the Tribunal, or to the Chairman in case the Tribunal consists of more than one member, by registered post or may be presented to such member of the staff of the Tribunal as the Tribunal, or as the case may be, the Chairman may authorise for the purposes and, if so sent or presented, shall, unless the Tribunal or Chairman otherwise directs, be made in duplicate and shall be signed by the applicant. There shall be appended to every such application a certificate which shall be signed by the applicant tot he effect that the statement of facts contained in the application is to be best of his knowledge and belief, true. If the claim in the application does not exceed Rs.10,000/- then every such application shall be accompanied by all the documents and affidavits for the proof of those documents and of all facts on which the applicant relies in support of his claim, entered in a properly prepared list of documents and affidavits. The claims Tribunal may not allow the applicant to rely in support of his claim on any documents or affidavits not filed along with the application, unless he satisfies the Claims Tribunal that for god or sufficient cause, he was prevented from filing such documents or affidavits, as the case may be, along with his application. (5) There shall be appended to every such application, the following documents namely:- (i) First Information Report in respect of the FA/1683/2005 JUDGMENT accident, (ii) Medical certificate of injuries or Postmortem Report, or death certificate; and (iii)a certificate regarding ownership and insurance particulars of vehicle involved in the accident from the Regional Transport Officer or the Police Station, concerned.

212. Fees.- (1) An application for compensation under rule 211, where a claim is for an amount not exceeding Rs.9,999/- shall be accompanied by an amount of ten rupees: Provided that if the person making the application succeeds he shall be liable to pay by way of fee an amount equal to the full fee leviable or the amount at which the claim is awarded by the Tribunal according to the following scale: (i) If the amount at which the claim is awarded does not exceed one hundred rupees – Ten rupees. (ii) If the amount at which claim is awarded exceeds one hundred rupees, for every ten rupees or part thereof, in excess of one hundred rupees, upto one thousand rupees – One rupees. (iii)If the amount at which the claim is awarded exceeds one thousand rupees, for every one hundred rupees or part thereof in excess of one thousand rupees, upto five thousand rupees – Six Rupees and twenty five paise. (iv) If the amount at which the claim is awarded exceeds five thousand rupees for every two hundred and fifty rupees, or part thereof in excess of five thousand rupees, upto nine thousand nine hundred and ninety nine rupees – Twenty rupees. (2) An application for compensation under rule 211 in respect of a claim of an amount exceeding Rs.9,999 shall be accompanied by an amount equal to one-half of the fee leviable on the amount at which the claim is valued in the application according to the following scale: (i) If the amount at which the claim is valued does not exceed ten thousand rupees – Seven hundred fifty rupees. (ii) If the amount at which the claim is valued exceeds ten thousand rupees, for every fee hundred rupees, or part thereof, in excess of ten thousand rupees, upto twenty thousand rupees – Thirty five rupees. FA/1683/2005 JUDGMENT (iii)If the amount at which the claim is valued exceeds twenty thousand rupees for every one thousand rupees, or part thereof, in excess of twenty thousand rupees, upto thirty thousand rupees – Forty five rupees. (iv) If the amount at which the claim is valued exceeds fifty thousand rupees, for every five thousand rupees, or part thereof, in excess of thirty thousand rupees, upto fifty thousand rupees – Sixty rupees. (v) If the amount at which claim is valued exceeds fifty thousand rupees, for every five thousand rupees, or part thereof, in excess of fifty thousand rupees, upto one lakh of rupees – Eighty rupees. (vi) If the amount at which the claim is valued exceeds one lakh rupees for every ten thousand rupees, or part thereof, in excess of one lakh of rupees –One hundred rupees. Subject to a maximum fee of fifteen thousand rupees only; Provided that if the person making the application succeeds, he shall be liable to make god the deficit if any, between the full fee payable on the amount at which the claim is awarded by the Tribunal according to the said scale and the fee already paid by him. (3) The fees payable under this rule shall be paid in the form of Court fee stamps.

213. Exercise of powers of Civil Court.- The claims Tribunal may exercise all the powers of a Civil Court save in so far as the same are not inconsistent with the provisions of the Motor Vehicles Act, 1988 and the rules made thereunder. 214 to 216 xxx xxx xxx

217. Examination of applicant.- On receiving an application under rule 211, the Claims Tribunal may examine the applicant upon oath, and the substance of such examination shall be reduced in writing and shall be signed by the member constituting the Tribunal or as the case may, be, the Chairman.

218. Summary dismissal of application.- The Claims Tribunal may, after considering the application and the statement, if any, of the applicant recorded under rule 217, summarily dismiss the application, if for reasons to be recorded, the Tribunal is of opinion that there are not sufficient grounds for proceeding therewith. FA/1683/2005 JUDGMENT

219. Notice to opposite party.-If the application is not dismissed under rule 218, the Claims Tribunal shall send to the insurer or the owner or the driver of the motor vehicle against whom the applicant claims relief (hereinafter referred to as “opposite party”), a copy of the application and if the claim in the application does not exceed Rs.10,000/- also copies of all the documents and affidavits, together with a list thereof filed by the applicant under sub-rule (4) of rule 211, together with a notice of the date on which it shall dispose of the application; and may, in case in which the claim in the application exceeds Rs.10,000/-, call upon the parties to produce on that date any evidence which they may wish to tender.

220. Examination of opposite party.- (1) The opposite party may, and if so required by the Claims Tribunal, shall at or before the first hearing of within such time as the Claims Tribunal may permit, file a written statement dealing with the claim raised in the application, and any such written statement shall form part of the record: Provided that in case of an application in which the claim does not exceed Rs.10,000/- the opposite party shall, on the date mentioned in the notice sent to him, file his written statement dealing with the claim raised in the application together with all the documents and affidavits for the proof of those documents and of facts on which he relies in support of his defence of the application entered in a properly prepared list of documents, affidavit and shall give to the applicant copies of the written statement, documents and affidavits. Provided further that the Claims Tribunal may not allow the opposite party to rely in support of his defence, on any documents or affidavit not filed along with the written statement, unless he satisfies the Claims Tribunal that for good or sufficient cause, he was prevented from filing such document or affidavit, as the case may be, along with his written statement. (2) If the opposite party contests the claim, the Claims Tribunal may and if no written statement has been filed, shall proceed to examine him upon the claim and shall reduce the results of the examination in writing.

221. Framing of issue.- After considering any written statement and the result of any examination of the parties, the Claims Tribunal shall ascertain upon what material propositions of fact or of law the parties are at variance, and shall thereupon proceed FA/1683/2005 JUDGMENT to frame and record the issues upon which the right decision of the case appears to it to depend.

222. Determination of issue.- After framing the issues, the Claims Tribunal shall proceed to record evidence thereon which each party may desire to produce.

223. Summoning of witnesses.- If an application is presented by any party to the proceedings for citation of witnesses, the Claims Tribunal shall, on payment of such expenses and fees, if any, as it may determine, issue summons for the appearance of such witnesses, unless it considers that their appearance is not necessary for a just decision of the case.

224. Recording of evidence.- The member constituting the Claims Tribunal or the Chairman thereof shall make a brief memorandum of the substance of the evidence of every witness as examination of the witness proceeds and such memorandum shall be written and signed by the member or the Chairman thereof with his own hand and shall form part of the record. Provided that, if the member or the Chairman is prevented from making such memorandum, he shall record the reason of his inability to do so and shall cause such memorandum to be made in writing from his dictation and shall sign the same, and such memorandum shall form part of the record: Provided further that the evidence of any medical witness shall be taken down as early as may be, word for word.

225. xxx xxx xxx

226. Summary examination.- (1) The Claims Tribunal during a local inspection or at any other time, save at a formal hearing of a case pending before it, may examine summarily any person likely to be able to give information relating to such case, whether such person has been or is to be called as a witness in the case or not, and whether any or all of the parties are present or not. (2) No oath shall be administered to a person examined under sub-rule (1).

227. xxx xxx xxx

228. judgment.- The Claims Tribunal, in passing orders, shall record concisely in a judgment the finding on each of the issues framed, and its reasons for such finding.

229. Application of Code of Civil Procedure.- In so far as these rules make no provision or make FA/1683/2005 JUDGMENT insufficient provision, the Claims Tribunal shall follow the procedure laid down in the Code of Civil Procedure, 1908 (V of 1908) for the trial of suits.

230. xxx xxx xxx

231. Procedure regarding compensation on the principal of no fault:- Notwithstanding anything contained in rules 211 to 230 and 232, in the case of a claim for compensation under Chapter X of the Act, the procedure shall be as follows, namely- (1) (2) (3) XXX XXX XXX XXX XXX XXX XXX XXX XXX (4) The claims Tribunal shall dispose of the application for compensation within six weeks from the date of receipt of such application. (5) For the purpose of adjudicating and awarding the claim, the Claims Tribunal shall follow the procedure of summary trial as contained in Chapter XXI of the Code of Criminal Procedure, 1973. (6) XXX XXX XXX (7) For the purpose of adjudicating and awarding the claim, the Claims Tribunal shall obtain whatever information and document considered necessary by it from the police, medical and other authorities. (8) On receipt of the application for compensation, the Claims Tribunal shall give notice to the owner, and the insurer, if any, of the vehicle involved in the accident, directing them to appear on a date not later than ten days from the date of issue of such notice. The date so fixed for such appearance shall also be not later than fifteen days from the receipt of the application for compensation. The Claims Tribunal shall state in such notice that, in case they fail to appear on such appointed date, the Tribunal shall proceed ex parte on the presumption that they have no contention to make against the award of compensation. (9) (10) (11) XXX XXX XXX XXX XXX XXX XXX XXX XXX (12) The Claims Tribunal, in passing the orders, shall FA/1683/2005 JUDGMENT also direct the owner or insurer, of the vehicle involved in the accident, to pay the amount of compensation to the claimant within thirty days from the date of the said orders.”

8. In Bishan Devi case (supra), the Apex Court said in paragraphs­14 to 21 that: “14.   The   instant   case   brings   into   focus   the   difficulties   experienced   by dependents in obtaining relief before the Motor Accidents Claims Tribunal. The victim in this case Bhagwan Das was run over by a motor vehicle on the   night   between   8th  and   9th  July,   1961   leaving   behind   him   his   wife Bishan Devi and four minor children.  For eighteen long years they have been before courts asking  for some compensation  for the death of their bread­winner due to rash and negligent driving of a motor vehicle.  One is tempted to remark that they would have been better off but for their hope of getting some relief in courts.  They not only had to spend their time in courts but to borrow to fight for their rights.  It is common knowledge that such helpless and desperate condition is exploited by unscrupulous persons who manage to get away with the bulk of the compensation money if and when the claimants succeed in getting it.

15. The law as it stands requires that the claimant should prove that the driver of the vehicle was guilty of rash and negligent driving.   The burden   thus   placed   is   very   heavy   and   difficult   to   discharge   by   the claimant.  The records of police investigation are not made available to the Tribunal.  The officers who investigated the accident are seldom available to   give   evidence   before   the   Claims   Tribunal   and   assist   in   coming   to   a proper conclusion.  The insurance company in quite a few cases, as in the present one, takes an unreasonable stand and raises all sorts of untenable pleas just to thwart relief to the dependents.   In many of the claims it turns out to be beyond the capacity of the claimant to maintain his claim in a court of law. FA/1683/2005 JUDGMENT

16. Due to the inordinate delay in disposal of claim petitions before the Motor (Accidents) Claims Tribunal the badly needed relief to the claimants is not available for several years.   Further time is taken in appeals.   All along the dependents will have to carry on without any relief.  It has been time and again pointed out by courts that insistence of proof of rash and negligent driving causes considerable hardship on the claimants.

17. We may point out that repeated suggestions have been made by this Court and  several  High Courts expressing  the desirability  of bringing  a social insurance which would provide for direct payment to the dependents of the victim.   This Court in  Minu  B. Mehta vs.  Balkrishna  Ramchandra Nayan,  1977  ACJ  118  has   referred  to the  decision  of  the  Kerala  High Court in Kesavan Nair v. State Insurance Officer, 1971 ACJ 219 where the High Court expressed itself thus: “Out of a sense of humanity and having due regard to the handicap of the innocent victim in establishing the negligence of the operator of the vehicle a blanket liability must be cast on the insurers.” The Madras High Court in M/s. Ruby Insurance Co. Ltd. v. V. Govindaraj, A.A.O. Nos. 607 of 1973 and 296 of 1974 decided on 13­12­1976 has suggested the necessity of having social insurance to provide cover for the claimants irrespective of proof of negligence to a limited extent say Rs.250 to Rs.300 a month.

18. In a recent decision in State of Haryana v. Darshan Devi, 1979 ACJ 205 this Court observed:­ “Now  that  insurance   against   third  party  risk  is   compulsory   and   motor insurance   is   nationalised   and   transport   itself   is   largely   by   State Undertakings, the principle of no fault liability and on the spot settlement of claims should become national policy.”

19. Unless these ideas are accepted by the legislature and embodied in FA/1683/2005 JUDGMENT appropriate enactments Courts are bound to administer and give effect to the law as it exists today.

20. It   is   for   the   legislature   to   make   provisions   for   immediate   and adequate relief to the defendants in motor accident cases.  The legislature may consider making the liability to pay minimum compensation absolute as is provided for to the dependents of victims in rail and air accidents. When a person dies in a motor accident, the number of his dependents and the   period   of   their   dependency   may   be   ascertained.     The   minimum compensation may be paid every month to the dependents according to their share for the period to which they are entitled.

21. The insurance companies are now  nationalised  and the necessity for awarding lump sum payment to secure the interest of the dependents is no longer there.  Regular monthly payments could be made through one of the nationalised banks nearest to the place of residence of the dependents. Payment of monthly installments and  avoidance of lump  sum  payment would reduce substantially the burden on the insurer and consequently of the insured.   Ordinarily in arriving at the lump sum payable, the Court takes the figure at about 12 years payment.  Thus in the case of monthly compensation   of   Rs.250   payable,   the   lump   sum   arrived   at   would   be between 30,000 and  35,000.  Regular monthly payment of Rs.250 can be made from the interest of the lump sum alone and the payment will be restricted only for the period of dependency of the several dependents.  In most cases it is seen that a lump sum payment is not to the advantage of the dependents as large part of it is frittered away during litigation and by payment to persons assisting in the litigation.   It may also be provided that if the dependents are not satisfied with the minimum compensation payable they will be at liberty to pursue their remedies before the Motor Accidents Claims Tribunal.” This decision does not help the appellant, rather, it emphasizes the need for a mechanism FA/1683/2005 JUDGMENT for   payment   of   compensation   to   victims   of accident to avoid harassment and exploitation by   unscrupulous   persons,   inordinate   delay, untenable   defences.     It   propounds   for desirability   of   legislation   providing   for payment   of   minimum   compensation   absolute   and giving   liberty   to   pursue   remedies   before   the Motor Accidents Claims Tribunal.

9. In Shivaji Dayanu Patil case (supra), the   appellant   raised   question   with   regard   to procedure   to   be   followed   by   Claims   Tribunal while adjudicating claims under Section 92 of the Act and submitted that such claims should be adjudicated like claims under Section 110A of   the   Act   and   that   the   claimant   must   first adduce   evidence,   establish   his/her   case   and that the owner as well as the insurer of the vehicle in question must have right to adduce evidence to rebut the same.  These submissions were advanced in the context of Bombay Motor Vehicle Rules, 1989, recorded in paragraph­37 of the judgment.  Thereafter, dealing with the FA/1683/2005 JUDGMENT contention, the Apex Court said in paragraphs­ 42 & 43: “42.  Rule   306C   prescribes   the   procedure   of   disbursement   of compensation u/S.92A to the legal heirs in case of death.  The submission of Shri  Sanghi  is that in spite of the aforesaid amendments which have been   introduced   in   the  Rules  after   the  enactment  of  S.92A,   the  Claims Tribunal is required to follow the procedure contained in the  other rules before awarding compensation under S.92A of the Act.  In other words, it must proceed to adjudicate the claim after the opposite party is afforded an opportunity to file the written submission under Rule 298, by framing issues   under   Rule  299   and   after   recording   evidence  in   accordance  with Rules 300 and 301 and that it is not permissible for the Claims Tribunal to make an order purely on the basis of the documents referred to in Rules 291A,   306A   and   306B.     In   our   opinion,   the   said   submission   of   Shri Sanghi   cannot   be   accepted.     The   object   underlying   the   enactment   of Section 92A is to make available to the claimant compensation amount to the   extent   of   Rs.15,000/­   in   case   of   death   and   Rs.7,500/­   in   case   of permanent disablement as expeditiously as possible and the said  award has to be made before adjudication of the claim u/S.110A of the Act.  This would be apparent from the provisions of S.92B of the Act. S.92B(2) of the Act provides that a claim for compensation u/S.92A in respect of death or permanent disablement of any person shall be disposed of as expeditiously as possible and where compensation is claimed in respect of such death or permanent disablement u/S.92A and also in pursuance of any right on the principle of fault, the claim for compensation u/S.92A shall be disposed of as   aforesaid   in   the   first   place.     With   a   view   to   give   effect   to   the   said directive contained in S.92B of the Act, the Maharashtra Government has amended the Rules and has inserted special provisions in respect of claims under S.92A in Rules 291A, 291B, 297(2), 306A, 306B, 306C and 306D of   the   Rules.     The   object   underlying   the   said   provisions   is   to   enable expeditious disposal of a claim petition u/S.92A of the Act.  The said object would be defeated if the Claims Tribunal is required to hold a regular rial in the same manner as for adjudicating a claim petition u/S.110A of the FA/1683/2005 JUDGMENT Act.  Moreover, for awarding compensation u/S.92A of the Act, the Claims Tribunal is required to satisfy itself in respect of the following matters: (i) (ii) an accident has arisen out of the use of a motor vehicle; the   said   accident   has   resulted   in   permanent   disablement   of   the person   who   is   making   the   claim   or   death   of   the   person   whose   legal representative is making the claim; (iii) the claim is made against the owner and the insurer of the motor vehicle involved in the accident.

43. The document referred to in Rules 291A and 306B will enable the Claims Tribunal to ascertain the necessary facts in regard to these matters.   The panchnama and the First Information Report will show whether the accident had arisen out of the use of the motor vehicle in question.   The Injury Certificate or the post­mortem  report will show the nature of injuries and the cause of death.  The Registration Certificate and Insurance Certificate o the motor vehicle will indicate who is the owner and insurer of the vehicle.    In the event of the Claims Tribunal  feeling doubtful about the correctness or genuineness of any of these documents or if   it   considers   it   necessary   to   obtain   supplementary   information   or documents,   Rules   306A   empowers   the   Claims   Tribunal   to   obtain   such supplementary information or documents from the Police, medical or other authorities.     This   would   show   that   Rr.291A,   306A   and   306B   contain adequate  provisions   which  would   enable   the  Claims   Tribunal   to  satisfy itself   in   respect   of   the   matters   necessary   for   awarding   compensation u/S.92A   of  the   Act  and   in   view   of   these  special   provisions   which   were introduced in the Rules by the amendments in 1984, the Claims Tribunal is not required to follow the normal procedure prescribed under the Act and the Rules with regard to adjudication of a claim u/S.110A of the Act for the purpose of making an order on a claim petition u/S.92A of the Act. In   this   case,   claim   in   the   applications rested   on   no   fault   liability   and   fault FA/1683/2005 JUDGMENT liability,   therefore,   the   Apex   Court   rightly said that claim under Section 92A in respect of   permanent   disablement   of   any   person   shall be   disposed   of   as   expeditiously   as   possible and   the   said   award   has   to   be   passed   before adjudication   of   the   claim   under   Section   110A of the Act.   The object of deciding no fault claim   expeditiously   would   be   defeated   if   the Claims Tribunal is required to hold a regular trial in the same manner as for adjudicating the   scheme   under   Section   110A   of   the   Act. Moreover,   for   awarding   compensation   under Section 92A of the Act, the Claims Tribunal is required   to   satisfy   in   respect   of   matters where: (i) an accident has arisen out of the use of a motor vehicle; (ii)the   said   accident   has   resulted   in permanent disablement of the person who is making   the   claim   or   death   of   the   person whose   legal   representative   is   making   the claim; (iii)the claim is made against the owner and FA/1683/2005 JUDGMENT the insurer of the motor vehicle involved in the accident.

10. In Jethu Ram case (supra), it is held by the Apex Court that where the amount of no fault   liability   is   suffered   by   the   Insurance Company,   it   is   entitled   to   recover   the   same from the owner where it is not liable to pay compensation on merits of the case.  There is no dispute on this question but this decision does   not   hold   that   in   the   absence   of   fault claim, no fault claim is not maintainable.  In Sita   Bai   case   (supra),   the   question   for consideration   is   different,   therefore,   no assistance can be taken from it.

11. In Hansrajbhai V. Kodala case (supra) it is held that determination of compensation under   structured   formula   under   Section   163­A is in the alternative and not in addition to the   determination   of   compensation   under Section   168   on   principle   of   fault   liability, which   means   determination   of   compensation FA/1683/2005 JUDGMENT under   Section   163A   and   Section   168   are independent   of   each   other   and   compensation determined   under   either   of   them   is   final, meaning   thereby,   claimant   cannot   resort   to fault liability compensation after having got compensation   under   either   of   the   two provisions.     The   Court   further   holds   that legislature   did   not   provide   for   additional compensation   under   Section   163A   or   under Section 168, like it did under Sections 140. In case of hit and run motor accidents under Section 161, there is provision for adjustment or refund of compensation on determination of fault liability award under Section 168 of the Act.     There   is   no   procedure   for   refund   or adjustment of compensation paid under Section 163A.  In paragraph 15, the Apex Court said: “15. The aforesaid conclusion gets support from the language used in  Sections 140, 141, 161 and 163A.  Sections 140  to 143  provide  for liability   of   the   owner   of   the   vehicle     in   case    of    death   or   permanent disablement  of any  person resulting  from an accident arising out of use of  a  motor vehicle or  motor vehicles to pay compensation without any pleading or establishing that death or permanent disablement was due to any wrongful act, neglect or default of the owner or  owners  of the vehicle or vehicles. By   way   of     earliest   relief,   victim   is   entitled   to   get   the FA/1683/2005 JUDGMENT amount of compensation of  Rs.50,000/­ in case of death and Rs.25,000/­ in case  of permanent  disablement. It is further provided  that such   claim shall not be defeated by reason of any wrongful act, neglect or default of the   person   in   respect   of   whose     death   or     permanent   disablement   has occurred. Sub­section (5) of Section 140  upon which much reliance is placed by   learned counsel for the Insurance Companies as well as the claimants   requires     consideration   and   interpretation,   which   inter   alia provides   that owner of the vehicle is also liable   to pay compensation under   any   other law for the   time   being   in force. The   word   also indicates that the owner   of   the vehicle would be additionally liable to pay compensation under  any  other  law for the time being  in force.  The proviso   to   sub­section   (5)   further   clarifies   that   the   amount   of compensation  payable under any other law for  the time being  in  force is   to  be  reduced   from  the  amount  of compensation   payable under sub­section   (2)   or   under   section   163A.   This   is   further  crystalized  in Section    141   which provides   that right to claim  compensation  under Section 140 is  in addition to any other right to claim compensation  on the  principle of fault liability and specifically  excludes the right to claim compensation under the scheme referred to in   Section   163A.   Section 163B also provides that where  a person is   entitled   to   claim   compensa­ tion under Section 140 and   Section 163A, he can file the claim under either of the said  sections, but  not under both. Similarly,  Section 141(1) also  crystalises that right to claim compensation under  Section 140  is in addition to the  right  to  claim compensation in respect thereof under any other provision of the   Act or any other law for the time being in force. Sub­section   (2)   further   provides   that   if   the   claimant   has   filed   an application for compensation under Section 140 and also in   pursuance of     any   right     on     the   principle   of     fault   liability,     the   claim   for compensation under Section 140   is to   be disposed   of in the first place and as provided  in sub­section (3) the amount received under sub­section (2) of Section 140 is to be adjusted while paying the compensation on  the principle   of  fault   liability.     On   the  basis   of  fault   liability   if  additional amount is required to be paid then the   claimant   is entitled to get the same but there  is  no provision  for refund of the amount received under FA/1683/2005 JUDGMENT Section 140(2), even  if  the Claims Tribunal  arrives   at the conclusion that     the claimant   was  not  entitled  to   get any  compensation    on  the principle of fault liability.  Further, Section 144 gives overriding effect to the provisions made under  Chapter X  by providing that the provisions  of the chapter shall have   effect notwithstanding any     thing contained   in any provision of the Act or of any other law for  the time being in force. From the aforesaid   Sections, one   aspect   is   abundantly   clear     that right  to   claim compensation  on  the  basis  of  no­fault  liability  under Section 140  is  in  addition to  the  right to   claim compensation on the principle of fault liability or right to get  compensation  under  any  other law.   Such  amount  is required  to  be reduced from the amount payable under the fault   liability or compensation which may be received under any other law. If nothing is payable under the Act then the claimant is  not required to refund the amount received  by him. As  against this, there   is   specific   departure   in   the   scheme   envisaged   for   paying compensation under Section 163A. Section 163A nowhere provides   that this payment of compensation   on   no   fault   liability on   the   basis of structured  formula  is in addition to the liability to pay compensation   in accordance with   the  right   to get compensation  on the principle of fault liability and unless otherwise  provided for the same cause, compensation cannot be paid again. Provisions for refund of compensation if compensation is received under any other law or under the Act:” Further, in paragraph­16, it has been held that: “16. Further,     as   the   legislature   has   not   provided   for   refund   or adjustment   of   compensation   received   under   the   Act     and   compensation payable under Section 163A, it would mean that Scheme of payment of compensation under Section 163A is   in alternative   to determination of compensation under  Section 168.   As  stated  above, sections 140(5)  and 141(3) make provisions  for reduction of compensation paid under Section FA/1683/2005 JUDGMENT

140.   Under proviso to sub­Section (5) of Section 140, the amount of such compensation which the claimant is  entitled to  receive  under any other law is required to be   reduced from the amount of compensation payable under Section 140 or under   Section 163A.   Under Section 141(3), if a person   gets   the     compensation   on   principle   of   fault   liability,   then   also provision is  made for adjustment of compensation  received under  section

140.  There is no such  provision for adjustment  of compensation received under section 163A from the compensation receivable under the Act on the principle   of     fault.       Similarly,   section   161   provides   for   payment     of compensation  in  case of hit and  run motor accidents. Under  Section 161(3), in cases in respect of the death  of any  person resulting from a hit and   run   motor   accident,   a   fixed     sum   of   Rs.25,000/­   is   to   be  paid   as compensation   and   in     case   of   grievous   hurt,   the   amount   fixed   is Rs.12,500/­. Thereafter,   under Section 162, the legislature has provided for  refund  of compensation paid under Section 161  on the principle  of hit   and   run   motor   accident   by   providing   that   the     payment     of compensation under Section  161  shall  be subject to the condition that if any compensation is awarded under  any other provision of this Act or any other   law or     otherwise, so   much   amount   as   is    equal    to     the compensation  paid  under  Section  161 is  required  to  be adjusted  or refunded   to   the   insurer.     Under   section   162(2),   duty     is     cast   on   the Tribunal,   Court  or    other    authority  awarding     such  compensation     to verify   as     to   whether     in   respect   of     such   death   or   bodily   injury, compensation   has   already   been   paid   under   Section   161   and   to   make adjustment as   required thereunder.   Result is claimant is not entitled to have  additional   compensation   but  at  the   same   time   he  can   proceed   by filing application under Section 165 or under the Workmen Compensation Act (i.e.   other law) and if he gets compensation under either of the said provisions,   the   amount   paid   under   Section   161   is   to   be   refunded   or adjusted.” Further, in paragraph­17 the Court said: “17. The   contention   of   the   learned   counsel   for   the   claimants   that FA/1683/2005 JUDGMENT compensation   payable   under   Section   163A   is   in   addition   to     the determination   of   compensation   on   the   basis   of     fault   liability   and thereafter it could be adjusted on the similar lines  provided under Section 140   read   with   Section   141   or   Section162   cannot   be   accepted.       The Legislature has specifically provided scheme of adjustment of compensation under  Section 140 read with Section 141 and Section 162 if the claimants get compensation under the Act, while there is no such  provisions  under Section163A. Addition or introduction   of  such scheme in   provisions would  be impermissible. Use of   different words such as any other law,   under this   section any other law for the time being in  force, provisions  of this Act or any other provision of  this Act in different sections:” Question whether application under Section 140 is maintainable independent of application under   Section   166   did   not   come   for consideration in this case. 12 In Deepal Girishbhai Soni case (supra) the   Apex   Court   approved   Hansrajbhai   Kodala case (supra) to the extent amongst others that compensation   payable   on   structured   formula basis under Section 163A is final and cannot be altered or varied in any other proceedings. It   disapproves   to   the   extent   Hansrajbhai Kodala   (supra)   treats   the   annual   income   of FA/1683/2005 JUDGMENT Rs.40,000/­   as   a   cap   for   calculation   under Section 163A.  With regard to Sections 140 and 163A,   the   Court   said   in   paragraph­43   to   48 that: “43. The   submission   of   learned   counsel   appearing   on   behalf   of   the appellants to the effect that Sections 140 and 163­A provide for similar scheme  cannot be  accepted for  more than   one reason.     Payment  of the amount in terms of Section 140 of the Act is ad hoc in nature.   A claim made thereunder, as has been noticed herein before, is in addition to any other claim which may be made under any other law for the time being in force.  Section 163­A of the Act does not contain any such provision.

44. Section   163­A   of   the   Act   is   interlinked   with   several   sections   of Chapters  XI  and  XII   thereof.    Section   140   imposes  a   liability   upon   the owner   of   the   vehicle   to   pay   compensation   where   death   or   permanent disablement of any person has resulted from accident arising out of the use of a motor vehicle.   By reason of the said provision a fixed sum is to be paid.

45. Sub­Section   (4)   of   Section   140   provides   that   the   claim   for compensation under sub­section (1) thereof shall not be defeated by reason of any wrongful act, neglect or default of the person in respect of whose death   or   permanent   disablement   the   claim   has   been   made   nor   the quantum   of   compensation   recoverable   in   respect   of   such   death   or permanent disablement be reduced on the basis of the share of such person in the responsibility for such death or permanent disablement.  Sub­section (5) of Section 140 of the Act categorically provides that the obligation of the owner of the vehicle shall not be in derogation of any statutory law cast upon the owner of the vehicle to pay compensation under any other law for the time being in force subject, however, to the condition as has been laid down in the proviso appended thereto that the amount of such compensation to be given under any other law should be reduced from the FA/1683/2005 JUDGMENT amount of compensation payable thereunder or Section 163­A.

46. Section  163­A which has an overriding effect provides for special provisions   as   to  payment  of  compensation   on   structured   formula   basis. Sub­Section  (1) of Section  163­A contains non­obstante  clause in terms whereof the owner of the motor vehicle or the authorised insurer is liable to   pay   in   the   case   of   death   or   permanent   disablement   due  to   accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be.  Sub­ Section (2) of Section 163­A is in  pari  materia  with Sub­Section (3) of Section 140 of the Act.

47. Section   163­A   does   not   contain   any   provision   identical   to   Sub­ Section (5) of Section 140 which is also indicative of the fact that whereas in   terms   of   the   latter,   the   liability   of   the   owner   of   the   vehicle   to   give compensation  or relief under any  other law  for the  time being  in  force continues subject of course to the effect that the amount paid thereunder shall be reduced from the amount of compensation   payable   under the said Section or Section 163­A.

48. By   reason   of   the   Section   163­A,   therefore,   the   compensation   is required to be determined on the basis of a structured formula whereas in terms of Section 140 only a fixed amount is to be given.   A provision of law providing for compensation is presumed to be final in nature unless a contra indication therefor is found to be in the statute either expressly or by necessary implication.   While granting compensation, the Tribunal is required   to   adjudicate   upon   the   disputed   question   as   regard   age   and income of the deceased or the victim, as the case may be.  Unlike Section 140 of the Act, adjudication on several issues arising between the parties is necessary in a proceeding under Section 163­A of the Act.” (emphasis supplied) Thereafter   in   paragraphs­57   &   58,   the Court said that: FA/1683/2005 JUDGMENT

57. “We,   therefore,   are   of   the   opinion   that   remedy   for   payment   of compensation   both   under   Sections   163­A   and   166   being   final   and independent   of   each   other   as   statutorily   provided,   a   claimant   cannot pursue his remedies thereunder simultaneously.  One, thus, must opt/elect to go either for a proceeding under Section 163­A or under Section 166 of the Act, but not under both.

58. In Kodala (supra) the contention of the claimant that right to get compensation   is   in   addition   to   the   no­fault   liability   was,   thus,   rightly rejected.   In agreement with Kodala (supra) we are also of the opinion that unlike Sections 140 and 141 of the Act the Parliament did not want to provide additional compensation in terms of Section 163­A of the  Act.” Finally,   paragraphs­61   to   63   may   be quoted: “61. It is, therefore, evident that whenever the Parliament intended to provide for adjustment or refund of the compensation payable on the basis of no­fault liability, as for example, Sections 140 and 161 in case of hit and run motor accident, from the amount of compensation payable under the award on the basis of fault liability under Section 168 of the Act, the same has expressly been provided for and having regard to the fact that no such   procedure   for   refund   or   adjustment   of   compensation   has   been provided for in relation to the proceedings under Section 163­A of the Act, it must be held that the scheme of the provisions under Sections 163­A and 166 are distinct and separate in nature.

62. It is also not of much relevance that in terms of Section 140 of the Act, the owner of the vehicle has been fastened with the statutory liability and in Section 163­A thereof both the owner as also his authorised insurer has been made so liable.

63. In Sub­Section (5) of Section 140 of the Act the expression "also" FA/1683/2005 JUDGMENT has been used which is indicative of the fact that the owner of the vehicle would be additionally liable to pay compensation under any other law for the time being in force.   Proviso appended to Sub­Section (5) of Section 140 states that the amount of compensation payable under any other law for   the   time   being   in   force   is   to   be   reduced   from   the   amount   of   the compensation   payable   under   Sub­Section   (2)   thereof   or   under   Section 163­A of the Act.  Right to claim compensation under Section 140, having regard to the provisions contained in Section 141 is in addition to any other right to claim compensation on the principle of fault liability.  Such a provision does not exist in Section 163­A.  If no amount is payable under the fault liability or the compensation which may be received from any other law, no refund of the amount received by the claimant under Section 140   is   postulated   in   the   Scheme.     Section   163­A,   on   the   other   hand, nowhere provides that the payment of compensation of no­fault liability in terms   of   the   structured   formula   is   in   addition   to   the   liability   to   pay compensation   in   accordance  with   the  right   to   get  compensation   on   the principle   of   fault   liability.     It   is   also   not   correct   to   contend   that   the expression   "any   other   law   for   the   time   being   in   force"   used   in   Section 140(5) would include any other provisions of the Motor Vehicles Act.  Had the   intention   of   the  Parliament   been   to   include   the  other   provisions   of Motor Vehicles Act within the meaning of the expression "any other law for the time being in force", it could have said so expressly.  The very fact that the Parliament has chosen to use the expression "any other law", the same, in our considered opinion, would mean a law other than the provisions of the   Motor   Vehicles   Act.     The   proviso   appended   to   Sub­Section   (5)   of Section 140 of the Act is required to be given a purposive meaning.” (emphasis supplied) This   decision   does   not   lay   down   the proposition   put   forth   by   the   appellant.     No assistance   can   be   drawn   from   Asha   Rani,  B. Lakshmamma,   Bommithi   Subbhayamma   and Andhavarapu Kamaraju (supra)  cases. FA/1683/2005 JUDGMENT 13 In  Munshiram D.Anand v. Pravinsinh Prabhatsinh Anand Society,   Navagamgedh,   Jamnagar   (AIR   1997   GUJARAT   60)  case learned Single Judge of this Court (S.D. Shah J.)   said   that   lodging   of   claim   for compensation   under   Section   166   is   not   a condition   precedent   to   filing   claim   under Section   140   for   interim   compensation   on   the basis   of   no   fault   liability.     Even   if   claim under Section 166 is dismissed on grounds of limitation,   application   for   interim compensation   under   Section   140   cannot   be dismissed   on   that   ground.     This   means, application   under   Section   140   survives independently.   Its survival is not depending on   the   filing   of/continuance   of   application under   Section   166. Since   both   the applications   were   filed   simultaneously   and application   under   Section   140   is   to   be disposed   of   prior   to   the   application   under Section   166,   former   being   termed   interim application/interim   compensation,   otherwise once it is said that application under Section FA/1683/2005 JUDGMENT 140 is maintainable independent of claim under Section   166,   it   cannot   be   called   interim compensation   in   these   circumstances.     Same view   has   been   taken   by  S.D.   Shah  J.   in Maganlal Hirabhai Patel case (supra). 14 No different proposition has been laid down by the Full Bench decision of Orissa High Court in Dinanath Agrawalla case (supra).  In paragraph­9 A.  Pasayat, Ag. C.J. (as he then was)   said   that   there   is   no   dispute   with   the proposition that when on a cursory scrutiny of the materials on record the Tribunal comes to hold   that   ultimately   the   Insurance   Company would have no liability, question of asking it to pay under S.92­A does not arise in view of the legal position as the same stood at that time.   Obviously, while claiming compensation under Section 140 apart from other documents, there   is   document   of   insurance.     If   it   is found   that   the   vehicle   is   not   insured, Insurance   Company   cannot   be   asked   to   pay instead the owner of the vehicle can be called FA/1683/2005 JUDGMENT upon to pay the compensation.   However, once it   is   found   that   the   vehicle   was   insured, other   defences   based   on   the   policy   can   be examined   in   application   under   Section   166   if the same has also been filed. 15 In Thaglu Singh case (supra) Division Bench of Madhya Pradesh High Court held that the   defences   available   to   the   Insurance Company under Section 149(2) can be raised at the   time   of   adjudicating   claims   under   fault liability,   otherwise   it   would   frustrate   the legislative object introducing the concept of no   fault   liability.     In   paragraph­14,   Chief Justice U.L. Bhat speaking for the Bench said: “In  these cases,  there  is  no  contention  that the vehicles  involved  in   the accident are  not covered  by policies.    There is  also  no  dispute that  the vehicles were involved in accidents and death followed as consequence of the   accidents.     The   Tribunal   was,   therefore,   justified   in   directing   the insurance companies to pay compensation on the basis of no fault liability. If ultimately, in passing the final award, it is found that the insurer has no liability with regard to persons who sustained injuries, fatal or otherwise, the Tribunal may issue appropriate directions for re­reimbursement of the amount from the owner(s) of the vehicle(s).” 16 In   Mithakhan   Dinakhan   Notiyar   case FA/1683/2005 JUDGMENT (supra),   learned   Single   Judge   of   this   Court (Coram: J.M. Panchal J.) examined Section 140 and   Rule   231   of   the   Gujarat   Motor   Vehicles Rules,   1989   and   said   that   Section   140   is   a piece   of   beneficial   and   ameliorating legislation providing for immediate aid to the litigants.     The   claimant   is   not   required   to plead   and   establish   that   the   death   or permanent disablement in respect of which the claim   has   been   made   was   due   to   any   wrongful act, neglect or at the fault of the owner of the vehicle concerned or of any other person. While   construing   social   welfare   legislation, Courts   should   adopt   beneficial   rule   of construction, in any event construction which fulfills   the   policy   of   legislation.     For awarding   compensation   under   Section   140,   the Tribunal   is   not   required   to   follow   the procedure   contained   in   Rules   211   to   230   and

232.     No   regular   trial   is   to   be   held   for awarding compensation under Section 140.   The Tribunal would be entitled to pass an award as soon   as   it   comes   to   the   conclusion   that   the FA/1683/2005 JUDGMENT owner   of   the   vehicle   and   insured   were involved.     In   paragraphs­6   to   9,   Panchal   J. said: “6. Section 140 provides that where death or permanent disablement of any person has resulted from an accident arising out of the use of a motor vehicle or motor vehicles, the owner of the vehicle shall, or, as the case may be, the owners of the vehicles shall, jointly and severally, be liable to pay compensation in respect of such death or disablement in accordance with   the   provisions   of   the   said   section.     The   amount   of   compensation which is payable thereunder in respect of death of any person is a fixed sum   of   Rs.25,000/­   (Rupees   twenty­five   thousand)   and   the   amount   of compensation   payable   in   respect   of   the   permanent   disablement   of   any person is a fixed sum of Rs.12,000/­ (Rupees twelve thousand).  Sub­sec. (3) of Sec.140 provides that in any claim for compensation under sub­sec. (1) of Sec.140, the claimant shall not be required to plead and establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act, neglect or default of the owner or owners of the vehicle or vehicles concerned or of any other person.   It is, thus, that to a limited extent relief has been granted under Sec.140 of the Act to the victim who has suffered permanent disablement.   Such victim can claim Rs.12,000/­ without proof of any negligence on the part of the owner of the vehicle or of any other person.  This part of the Act is clearly a   departure   from   usual   common   law   principle   that   a   claimant   should establish negligence on the part of the owner or driver of the motor vehicle before claiming any compensation for permanent disablement caused on account of a motor vehicle accident.  To that extent substantive law of the Country stands modified. There is no manner of doubt that Sec.140 of the Act is beneficial and social welfare piece of legislation.  It is well settled that in construing social   welfare   legislation,   the   Courts   should   adopt   a   beneficial   rule   of construction  and  in  any  event, construction  to be adopted  on  a statute should be such so as to achieve the purpose for which it is enacted and in FA/1683/2005 JUDGMENT favour of those in whose interest the Act has been passed.   The liability under this section is made indefeasible, peremptory and total.  It has been put beyond dispute that insurer is clearly liable under Sec.140 of the Act in view of the provisions contained in Secs. 145 & 147 of the Act.

7. Rule   231   of   the   Gujarat   Motor   Vehicles   Rules,   1989   contains adequate   provisions   which   would   enable   the   claims   Tribunal   to   satisfy itself   in   respect   of   matters   necessary   for   awarding   compensation   under Sec.140 of the Act.   Sub­rule (9) of Rule 231 provides that the Claims Tribunal shall proceed with the application for compensation, on the basis of ­ (i) (ii) First Information Report; Injury certificate or Post­mortem report in case of death; (iii) Registration certificate of the motor vehicle involved in the accident; (iv) Cover note, certificate of insurance or the policy, relating to the insurance of the vehicle against third party risks; (v) The nature of the treatment given by the medical officer who has treated the victim. While making an order under Sec.140 of the Act, the Tribunal is not required to follow the procedure contained in Rules 211 to 230 and 232 of the Gujarat Motor Vehicles Rules, 1989.   Where compensation is claimed in respect of death or permanent disablement under Sec.140 and also   in   pursuance   of   any   right   on   the   principle   of   fault,   the   claim   for compensation under Sec.140 of the Act is required to be disposed of in the first place in  view  of  sub­Sec.(2)   of Sec.140   of  the  Act.   For  awarding compensation under Sec.140 of the Act, the Claims Tribunal is required to satisfy itself in respect of the following matters:­ (i) (ii) an accident has arisen out of the use of a motor vehicle; the   said   accident   has   resulted   in   permanent   disablement   of   the person who is making the claim or death of the person whose FA/1683/2005 JUDGMENT representative is making the claim; (iii) the claim is made against the owner and the insurer of the motor vehicle involved in the accident.

8. The question that falls for consideration is as to at what stage the Tribunal   is   to   inquire   into   objection   raised   by   the   Insurance   Company under the Act.  Should such objections be treated as preliminary issue and be decided by the Tribunal  in  the first instance which in  the nature of things would result in delay in regard to the payment of amount under Sec.140 of the Act to the claimant and defeat the very purpose underlying the   enactment   of   the   provision?     The   object   underlying   enactment   of Sec.140 is to make available to the claimant compensation amount to the extent of Rs.12,000/­ in case of permanent disablement as expeditiously as possible and the said  award has to be made before adjudication  of the claim under Sec.168 of the Act.   It must be seen that Sec.140 of the Act speaks of peremptory awards in cases of permanent disablement or death. The   object   underlying   this   consideration   is   the   immediate   relief   to   the disabled victim of accident in case of permanent disability.   Provision of Sec.140 is a piece of beneficial and ameliorative legislation providing for an immediate aid to the hapless and helpless victims of the motor vehicles. The objects for which Sec.140 of the Act is enacted would be defeated if the Claims Tribunal is required to hold regular trial in the same manner as for adjudicating a claim made in a petition filed under Sec.168 of the Act. Having   regard   to   the   purpose   underlying   the   enactment   of   the   said provision, I am of the opinion that the defences raised by the insurer or other objections of the insurer or the owner should be examined later when the claims petition is decided on merits.   The Claims Tribunal would be entitled to make award under Sec.140 of the Act as soon as it comes to the conclusion that the owner of the vehicle was involved and insured.   The persons   primarily   responsible   to   pay   compensation   or   damages   for   the accident to the injured or the heirs or legal representatives of the deceased are normally driver and owner of the offending vehicle.  The liability of the insurer is spelled out qua the person or classes of persons specified in the policy that is qua the insured under Sec.147(1) of the Act; and also qua FA/1683/2005 JUDGMENT the claimant of compensation under Sec.147(2) and 149(1) of the Act.  If an   award   is   given   against   insured   holding   him   liable   to   pay   certain amount as compensation or damages in regard to the claim arising out of an accident with his motor vehicle, then the liability of insurer is absolute and   the   insurer   cannot   question   its   liability   on   the   ground   that   the amount is awarded on the principle of no fault liability.  Moment either it is admitted by the owner of the vehicle that his vehicle is involved in the accident   or   from   the   evidence   adduced   on   the   record,   the   Tribunal positively holds that the vehicle of the owner in question was involved in that accident, then the Tribunal without inquiring into correctness of other objections that ma be raised by the Insurance Company would be entitled to make the award under Sec.140 and require the Insurance Company to pay specified amount to the claimants forthwith and thereafter investigate and inquire into the correctness or otherwise of the other objections that are   raised   either   by   the   Insurance   Company   or   by   the   owner   of   the offending vehicle at the time of deciding main claim petition.

9. From sub­rule (5) of Rule 231 of the Gujarat Motor Vehicles Rules, 1989   it   is   clear   that   a   summary   trial   is   contemplated   for   making   an award or order under Sec.140 of the Act.  The defence as presently raised by the insurer is naturally an issue in the main petition and it will have to be disposed of in that petition and perhaps by elaborate evidence.   This type of evidence necessary for disposal of an issue which is required to be dealt with in the main petition cannot be permitted to be led at the stage of   making   an   order   under   Sec.140   of   the   Act   and   in   this   view   of   the matter, I am unable to accept Mr. Makwana's challenge to the impugned order.  Ultimately, if the defence of the insurer is upheld, the insurer would be entitled to claim the amount awarded against it from others, i.e., from driver and owners, but not from the claimant. In   view   of   the   above   discussion,   I   am   of   the   opinion   that   the Tribunal   was   justified   in   not   entertaining   the   defence   raised   by   the petitioner when applications under Sec.140 of the Act came to be decided. No   jurisdictional   error   is   committed   by   the   Tribunal   necessitating FA/1683/2005 JUDGMENT interference of this Court with the impugned order while exercising powers under Sec.115 of the Code of Civil Procedure.   The Revision Application, therefore, fails.  Rule is discharged with no order as to costs.  Ad­interim relief granted earlier is hereby vacated.” This   judgment   is   followed   by   Single Bench   (Coram:   M.S.   Shah   J.)   in   Mahendrakumar Kalyan­jibhai   (supra).     In   paragraphs­16,   18 and 19, the Court said: “16. Chapter X of the Motor Vehicles Act contains provisions providing for   liability   without   fault   in   certain   cases.     Section   140   provides   for liability to pay compensation in case of death or permanent disability on the principle of no fault and provisions of sub­sec.(1) of Sec.141 preserve the right to claim compensation on the traditional principle of fault.  Sub­ sec.(2) of Sec.141 provides that a claim for compensation under Sec.140 in   respect   of   death   or   permanent   disablement   of   any   persons   shall   be disposed of as expeditiously as possible and that where compensation is claimed, in respect of such death or permanent disablement under Sec.140 and also in pursuance of any right on the principle of fault, the claim for compensation under Sec.140 shall be disposed of in the first place.   Sub­ sec.(3) of Sec.141 while providing that compensation paid under Sec.140 shall be adjusted against the higher amount of compensation payable on the principle of fault also provides that if the compensation payable on the principle   of   fault   is   less   than   the   compensation   already   paid   under Sec.140, the compensation under fault liability is not required to be paid, but there is no provision requiring the claimant to refund such amount received   under   Sec.140.     Section   142   defines   what   will   be   treated   as permanent disablement.  Section 143 provides for applicability of Chapter X also to claims for compensation under the Workmen's Compensation Act. Section   144   gives   overriding   effect   to   the   provisions   of   Chapter, notwithstanding anything contained in any other provisions of the Motor Vehicles Act or of any other law for the time­bing in force. FA/1683/2005 JUDGMENT

18. Rule 231 of the Gujarat Motor Vehicles Rules, 1989, particularly sub­rule (9) thereof provides that that claims Tribunal shall proceed with the application for compensation under Sec.140 of the Act on the basis of ­ (i) (ii) First Information Report; Inquiry certificate of post mortem report in case of death; (iii) Registration certificate of the motor vehicle involved in the accident; (iv) Cover note, certificate of insurance or the policy, relating  to the insurance of the vehicle against third party risk; (v) the nature of the treatment given by the medical officer who has treated the victim.

19. Before dealing with the submissions urged by Mr. Nanavati, at the outset it is necessary to bar in mind a few caveats and perceptions. Firstly, compensation payable under Sec.140 of the New Act is not “interim compensation” as is ordinarily understood.  Section 140 does not use this expression.  It is necessary to bear this caveat in mind because the word “interim” conditions our mind imperceptibly to turn to the general principle of civil law that what the plaintiff cannot get at the final hearing, he cannot get at an interim stage.  Once we get rid of this conditioning, it is much easier to appreciate the scheme of provisions of Sec.140 of the New Act (corresponding to Sec.92A of the Old Act) and similar other provisions. For instance, when a wife applies for maintenance pendente lite in a   matrimonial   petition,   she   is   required   to   lead   and   show   the   fact   of marriage with the respondent and her inability to maintain herself from her own source of earnings and not that she is likely to succeed in finally getting the relief prayed for in the main petition. FA/1683/2005 JUDGMENT Secondly, we must also bear in mind the reason why Parliament had to provide for compulsory insurance.  As pointed out by the Supreme Court in the case of Skandia Ins. Co. Ltd. v. Kokilaben Chandravadan, AIR 1987 SC 1184, the law may provide for compensation to the victims of the accident   who   sustain   injury   in   the   case   of   an   automobile   accident   or compensation to the dependents of the victims in the case of fatal accident, but such protection would remain illusory unless there is a guarantee that the compensation would be recovered from the persons held liable for the consequences of the accident.  A Court can only pass an award or decree. To   see   that   the  exercise   undertaken   by   the  Courts   does   not   remain   an exercise in futility, the Legislature has provided for compulsory insurance coverage for use of the motor vehicles.  Even in the case of Motor Owners Insurance Co. Ltd. v. Jadavji Keshavji Modi, 1981 GLR 1208 (SC): 1981 ACJ 507, the Supreme Court has expressed the difficulties of the victims of motor vehicle accident and their heirs in the following words: “common experience shows that the woes of the injured and of the heirs of those who perish in automobile accidents begin after they embark upon the adventure of execution proceedings ...... There are proverbial difficulties in proving ownership of goods vehicles, particularly if they are subject to a hire­purchase  agreement  and   truck   owners  are  quite  know  for   the  case with which they proclaim their insolvency.  It is, therefore, no consolation that the left­over liability will fall on the insured.” The difficulties that befall on the claimant after the award on the basis   of   fault   principle   are   bound   to   stare   him   in   the   face   even   after compensation is awarded to him under Sec.140 of the Act. The third important aspect, which is also required to be borne in mind and which appears to have prompted the Legislature in introducing Sec.92A in the Old Act corresponding to Sec.140 of the New Act, is the unfortunate spectre of phenomenal delays in  disposal  of motor accident claim cases.   Such claim cases were expected to be decided within a very short time of a year or so.  Unfortunately, such cases now drag on for as FA/1683/2005 JUDGMENT long as 10 to 12 years.   While the system of Lok Adalats has certainly made   substantial   contribution   in   easing   this   problem,   the   fact   remains that   at   Lok   Adalats   claim   petitions   with   pendency   of   2   to   3   years   get settled but such petitions pending for 8 to 10 years or longer do not get settled, because the Insurance Companies refuse to pay any interest on the amount of compensation which may be worked out by mutual consent as reasonable compensations.  Since this works out to as much as 90% of the compensation or even 150% of the compensation (12% rate of interest x 8 years   –   96%,   12%   x   10   years   –   120%   and   so   on   and   so   forth),   the claimants and their advisers are reluctant to settle old claim petitions at Lok   Adalats.     The   representatives   of   Insurance   Companies   plead   their inability to agree to payment of any interest even at a lesser rate than the rate at which the Tribunals normally award interest, on the ground of a directive from the higher­us in the General Insurance Corporation.  It is a matter of regret that such intransigent attitude is adopted which on the one hand prolongs the misery of the victims of motor accidents or their heirs and on the other hand adds burden on the Insurance Company by way of interest liability which goes on piling up.  Be that as it may, even pendency of claim petitions for 2 to 3 years would mean that persons who have suffered permanent disablement in a motor vehicle accident or heirs (usually widows and minor children) of victims who have succumbed to the injuries in such accidents have to continue to starve until they would get the award on the basis of fault principle after all the vicissitudes of the trial and defences raised by the Insurance Company would be examined. Fourthly, anyone who has even a nodding acquaintance with our legal system in action (or inaction) knows that a large part of the Courts' time  is  consumed   by hearing  of  applications  for  interlocutory  orders at which hearings the first question being examined at length is whether the plaintiff/petitioner   has   a   prima   facie   case   on   merits.     Interlocutory applications are also decided after six months if not a couple of years. Fifthly, as has already been observed by the Supreme Court in the case of Skandia Ins. Co. v. Kokilaben Chandravadan (supra) a benevolent FA/1683/2005 JUDGMENT provision made by legislature cannot be nullified by reading it with a non­ benevolent eye and with a mind not tuned to the purpose and philosophy of the legislation  without being informed of the true goals sought to be achieved.   What the legislature has given the Court cannot deprive of by way   of   an   exercise   in   interpretation   when   the   view   which   renders   the provision   potent   is   equally   plausible   as   the   one   which   renders   the provisions impotent. Thereafter, the Court said in paragraphs­ 25 and 29 that:­

25. If   the   Legislature   had   intended   that   all   such   questions   about defences of the Insurance Company could be raised in proceedings under Sec.140 of the Act.   Sec.144 would have provided that the provisions of Chapter X shall have effect subject to the provisions of Sec.149(2) of this Act but notwithstanding anything contained in any other provisions of this Act or of any other law for the time­being in force.

29. In view that I have taken about the scope of inquiry under Sec.140 of the Act, it is not necessary to go into the merits of the other defences urged by the learned Counsel for the Insurance Company.”

17. Similarly, Division Bench of  Himachal Pradesh   High   Court   said   in   Bhajnoo   case (supra)   that   defences   available   to   insurance company are not required to be inquired into before   making   insurance   company   liable   for interim award under no fault liability.  (See United India Insurance Co. Ltd. v. Ghisi Devi, 1989 ACJ 728 (Rajasthan). FA/1683/2005 JUDGMENT

18. In Sarju Ram case (supra) the Tribunal awarded interim compensation under Section 140 in   advance   of   application   under   Section   166. Question for consideration was similar to one before   us.     Single   Judge,  Ranchi  Bench   of Patna   High   Court   held   that   Chapter   X   of   the Act   being   an   independent   provision   has overriding effect over any other provision of the   Act.     In   paragraphs­6   &   7,   the   Court examined Chapter X of the Act and said: “6. From bare reading of the aforesaid provision, it is manifest that in case of death or permanent disablement of any person has resulted from an accident arising out of the use of the motor vehicle, the owner or the owners shall be jointly and severally liable to pay compensation. In such an   application   the   claimant   is   not   required   to   plead   and   establish negligence. Sub­section (5) very specifically clarified that notwithstanding payment of compensation under this Chapter, the owner of the vehicle is also liable to pay compensation under any other law for the time being in force. It is, therefore, evident that claiming  compensation  under no fault liability under S.140  of the Act is not dependent upon the filing of the application  under S.166  of the Act. This  has also  been clarified by the legislature under S.141 of the Act ....

7. On the plain reading of this provision, it is abundantly clear that such application filed under S.140 of the Act shall be disposed of independently irrespective of the fact whether claim under S.166 of the Act has been filed by   the   claimant   or   not.   The   proviso   to   sub­section   (1)   of   S.168   also provides   that   where   the   claimant   has   made   a   claim   for   compensation FA/1683/2005 JUDGMENT under S.140  of the said  Act then such claim  for compensation  shall be disposed of in accordance with the provisions of Chapter X of the Act.” Finally, the Court said in paragraph­ 19 that: “19. Having regard to the entire facts and circumstances of the case and the law discussed hereinabove, I am, therefore, of the definite opinion that Chapter   X   of   the   Act   is   an   independent   provision   and   the   Tribunal   is bound to  decide  the claim application filed under Section 140 of the Act for grant of interim compensation  notwithstanding the claimant having filed   any   other   application   under   Section   166   or   under   any   other provisions of the Act. I am  further of the opinion  that the provision  of Chapter X has overriding effect over any other provision of the Act and the Legislatures have made it clear under Section 144 of the said Act.”

19. The Division Bench of Patna High Court also holds in Fida Hussain case (supra) that application under Section 140 on principle of no   fault   is   maintainable   without   filing   any claim   under   Section   166. Therefore, application   under   Section   140   has   to   be disposed   of   independently,   thus,   approves Single   Bench   decision   in   Sarju   Ram   case (supra).  In paragraph­7, the Court said: “7. From a close reading of the above provisions it is manifest that the Act   does   not   create   any   bar,   express   or   implied,   to   the   filing   of   any application under section 140 directly without filing claim under section FA/1683/2005 JUDGMENT 166 of the Act.  As a matter of fact, sub­section (1) of section 141 makes it clear that the right to claim compensation under Section 140 is in addition to any other right.   It cannot thus be made dependent on filing of claim under  Section   166   of  the  Act.   Of course,  where  the  claimant  lodges  a claim for structured compensation in terms of the formula contained in the Second Schedule in accordance with section 163­A or on the basis of fault under   section   166   the   amount   of   compensation   payable   or   paid   under section 140 is to be deducted from the amount found payable under section 163­A or 166 as the case may be.  It is also clear that application under Section 140 of the Act has to be disposed of independently in accordance with   the   provisions   of   Chapter   X   of   the   Act   which   have   an   overriding effect.” In paragraph­13 it has been said that: “13. The   above   aspects   of   the   Act   were   not   at   all   considered   by   the learned single Judge in the cases of Oriental Insurance Co. Ltd. v. Chulchul Devi, 1999(1) PLJR 747 and Divisional Manager, Oriental Insurance Co. Ltd.   v.  Gulzari  Kuer,   1999   (1)   PLJR   872,   in   which   by   rather   cryptic orders, the same learned Judge held that a direct application under section 140 was not maintainable.  The decisions, in my opinion, do not lay down the correct law and deserve to be overruled.  In fact, earlier in the case of Oriental Insurance Co. Ltd. v. Mohiuddin Kureshi, 1994 ACJ 74 (Patna), a Division Bench of this court had observed: “From a conjoint reading of the aforementioned provisions there cannot be any doubt that an application under section 140 of the said Act can be filed separately. Recently, another learned single Judge of this court in the case of Oriental Insurance Co. Ltd.  v. Sarju  Ram,  2002  ACJ  177  (Patna),   has taken  a similar   view   regarding   maintainability   of   an   independent   application under section 140 of the Act which, in my opinion, is the correct legal position.” Finally,   in   paragraph­15   the   Court held that: FA/1683/2005 JUDGMENT “15. In the above premises, I hold that an application under section 140 of   the   Motor   Vehicles   Act   on   principle   of   `no   fault'   compensation   is maintainable without filing any claim under section 166 of the Act.”

20. Question arising for consideration in these   appeals   did   not   arise   in  Madho  Singh case (supra).  It is a case of fault liability under   Section   166   against   which   insurance company   can   raise   defences   available   to   it. Whether   it   can   be   called   upon   to   meet   the liability   of   claimant   and   recover   the   same from   the   insurance   company   after   having succeeded   in   proving   its   defences   does   not arise for consideration, otherwise, the issue has   been   considered   by   the   Apex   Court   in catena of cases.

21. The   Division   Bench   decision   (Coram: Bhawani Singh C.J. and Abhilasha Kumari J.) in Babubhai   Purshottambhai   Harijan   case   (supra) deals   with   this   question   extensively maintaining   the   view   of   this   Court   in Mithakhan   Dinakhan   Notiyar, Mahendrabhai Kalyanjibhai, Munshiram and Maganlal Hirabhai FA/1683/2005 JUDGMENT Patel cases (supra).  It has been said that: “10. The   object   behind   these   Sections   is   to   speed   up   payment   of compensation on “no fault” principle. The victim(s) of accident are, under these   beneficial   provisions,   entitled   to   get  the   minimum   statutory   relief expeditiously. Speed for expeditious disposal and payment of compensation is the essence. Otherwise, injustice and breach of legislative intent is the consequence.   Section   140   is   a   piece   of   legislation   intended   to   provide immediate relief to the victim(s). This  provision  is clearly    a  departure from   the   usual   common   law   principle   that   claimant   should   establish negligence on the part of the owner or driver of the motor vehicle before claiming compensation for the death or permanent disablement caused on account of the use of a motor vehicle [See: Gujarat State Road Transport Corporation,   Ahmedabad   v. Ramanbhai Prabhatbhai and   another   (AIR 1987   SC   1690)].   The   claimant   is  required  to   state   that   death   or permanent disablement has resulted from an accident arising out of the use of a motor vehicle or motor vehicles. He is not required to prove it like claim of fault liability under Section 166. Sub­section 2 of Section 141 provides that claim for compensation under Section 140 in respect of death or permanent disablement shall be disposed of as expeditiously as possible and where compensation is claimed in respect of such death or permanent disablement under Section 140 and also in pursuance of any   other right on the principle  of  fault,  the  claim for compensation under Section 140 shall be disposed of as aforesaid in the first place. Claim for compensation under Section 140 is independent. It need not be preceded or succeeded by claim under Section 166. Nowhere, Section 140 envisages this. Therefore, claim under Section 140 can be adjudicated and compensation awarded in absence   of   claim   under   Section   166   [See:  Munshiram D.Anand v. Pravinsinh Prabhatsinh Anand   Society, Navagamgedh ,   Jamnagar   (AIR 1997   GUJARAT   60)].   Object   behind   the   former   is   to   pay   statutory compensation  by   expeditious   disposal   thereof   and   following   the   normal procedures for disposal in the later which generally takes time for proof and   establishment   of   respective   claims   and   defences   of   parties.   Finally, Section 144 should clear the mist. It gives overriding effect to this Chapter over any other provisions of this Act or any other law for the time being in FA/1683/2005 JUDGMENT force.  Therefore, this provision is independent as against other  provisions in   the   Act   providing   for   adjudication   of   claims   for   compensation,   for example, Sections 161, 166 and 163. True it may be, all these claims are lodged before the Claims Tribunal and adjudicated by it, but that should not mean following the same method of trial. Deeper analysis of Sections 140, 161, 166 and 163­A would demonstrate that the legislature provides different modes for adjudication of claims under these provisions. Claim under   Section   140   is   decided   summarily   to   achieve  legislative   intent  of expeditious disposal of such claim for the benefit of victim(s) of accident. Therefore, defences put up by opponents can be adjudicated during trial of claim under Section 166 and in the event insurance company succeeding in establishing its defences, it can recover the loss from the insured, but not from the victims since they receive compensation under the principle of “no fault liability”. Even proviso to sub­section (1) of Section 168 provides that claim for   compensation   under   Section   140   in   respect   of   death   or   permanent disablement of any person, whether made in such application or otherwise, shall be disposed of in accordance with the provisions of Chapter­X.” Thereafter, in paragraphs­11 and 12 it has been said that “11. There may be cases where claim is lodged under Section 140 alone. In that situation, insurance company can recover the amount from the insured. However, where both the claims are lodged, compensation paid under Section 140 can be adjusted with compensation ultimately awarded under Section 166 and where the Claims Tribunal ultimately holds that insurer   was   not   liable   to   pay   compensation,   it   would   be   entitled   to reimbursement   from   the   insured.   [See:  National   Insurance   Co.   Ltd.   v. Jothu Ram & Ors. (Supreme Court) (1998(3) GLR 2261) ].

12. With  hereto before  examination  of the matter, it cannot be said that compensation  awarded under Section 140 is interim compensation simply   because   of   adjustment   against   compensation   awarded   under FA/1683/2005 JUDGMENT Section 166. Opposite view taken by Full Bench of Karnataka High Court in  United India Insurance Co. Ltd. v. Immam Aminasab Nadaf and others (supra) and in other decisions on similar lines, with respect, do not appeal to us in view of clear legislative intent running through provisions under Chapter­X of the  Motor Vehicles Act, 1988 and Section 168.” Finally, in paragraph­14 it is said that:

14. Therefore,   what we conclude is, claims under Sections 140, 161, 166, 163­A are independent of each other and tried accordingly. However, claim under Section 140 is triable summarily and expeditiously without requiring the victim to establish death or permanent disability due to any wrongful act, neglect or default or the owner of the vehicle concerned or of any   other  person.   Compensation   awarded   under  this   provision   is   being awarded   under   “no   fault   liability”,   therefore   final,   claimable   by   the insurer from the insured. However, where claim under Section 166 is filed, adjustment   of   amount   paid   under   Section   140   with   amount   awarded under   Section   166   can   be   done   since   Court   has   to   award   `just' compensation under Section 168 of the Act and avoid unjust enrichment of the victim.” 22 With   a   view   to   examining   the   matters further,   it   would   be   desirable   to   quote statement of objects and reasons prompting the legislature   making   provisions   for   payment   of compensation by way of no fault liability in hit and run cases:­ STATEMENT OF OBJECTS AND REASONS There has been a rapid development of road transport during the past few years and a large increase in the number of motor vehicles on the FA/1683/2005 JUDGMENT road.     The   incidence   of   road   accidents   by   motor   vehicles   has   reached serious   proportions.     During   the   last   there   years,   the   number   of   road accidents per year on the average has been around 1.45 lakhs and of these the   number   of   fatal   accidents   has   been   around   20,000   per   year.     The victims of these accidents are generally pedestrians belonging to the less affluent sections of society.  The provisions of the Act as to compensation in respect of accidents can be availed of only in cases of accidents which can be provided to have taken place as a result of a wrongful act or negligence on the part of the owners or drivers of the vehicles concerned.   Having regard to the nature of circumstances in which road accidents take place, in a number of cases, it is difficult to secure adequate evidence to prove negligence.    Further, in   what are known as “hit­and­run” accidents,  by reason   of  the   identity   of  the   vehicle   involved   in   the   accident   not  being known, the persons affected cannot prefer any claims for compensation.  It is, therefore, considered necessary to amend the Act suitably to secure strict enforcement of road safety measures and also to make, as a measure of social justice, suitable provisions first for compensation without proof of fault or negligence on the part of the owner or driver of the vehicle and, secondly,   for   compensation   by   way   of   solatium   in   cases   in   which   the identity   of   the   vehicle   causing   an   accident   is   unknown.     A   number   of suggestions have been received for amendment of the Act from the State Governments, representative organizations and other persons for making the provisions of the Act more effective.     The   Law   Commission   of   India,   in   its   Fifty­first   Report   on Compensation for Injuries Caused by Automobiles in Hit­and­Run Cases, has made certain suggestions with respect to hit­and­run cases.  The Law Commission   has   also   made   a   number   of   suggestions   in   its   Eighty­fifth Report on Claims for Compensation under Chapter VIII of the Act.   The examination   of   these   suggestions   would   take   some   time.     The   more important of these suggestions, which require to be implemented urgently, have been identified and it is proposed to give effect to the same through the present Bill. territory   administrations, Union

2. The Bill seeks to give effect to the following proposals:­ (a) A   new   Chapter   VIIA,   providing   for   payment   of   compensation   in certain cases of accidents without proof or fault or negligence on the part of the owner or the driver of the motor vehicle is being inserted in the Act. Under this Chapter, the owner of the vehicle involved in an accident will be liable to pay compensation of a fixed sum of Rs.15,000/­ in respect of the death of a person and a fixed sum of Rs.7,500 in respect of permanent disablement of any person.  For securing this compensation, it will not be necessary to prove any wrongful act or negligence on the part of the owner or the driver of the vehicle.  Right to claim the compensation aforesaid is without prejudice to any right to claim a higher compensation on the basis of the wrongful  act or negligence of the owner or the driver of the vehicle. However, the compensation payable by an owner on the basis of wrongful act   or   negligence   on   his   part   would   be   reduced   by   the   compensation already paid by him under this Chapter.  It has also been provided that the claim   for   compensation   under   the   Chapter   should   be   disposed   of   as expeditiously   as   possible.     The   benefit   of   the   provisions   of   the   Chapter FA/1683/2005 JUDGMENT would also be available in cases where compensation is claimed in respect of a motor accident under any other law, as for example the Workmen's Compensation Act, 1923.  It may also be mentioned that the owner of a vehicle will have to insure himself against liability to third parties under this Chapter to the same extent as he has to insure himself against liability to third parties in cases where he is in default or negligent (vide clauses 11, 12, 15, 16, 17, 18 and 19). A fascicle of sections is being inserted immediately after section 109 (b) of   the   Act   to   provide   for   compensation   in   cases   of   hit­and­run   motor accidents.  These provisions envisage the establishment of a Solatium Fund by   the   Central   Government   for   the   purpose   of   paying   compensation   in cases   of   hit­and­run   motor   accidents.     The   Fund   will   consist   of contributions   by   the   General   Insurance   Corporation   and   insurance companies carrying on general insurance business in India, contributions by the Central Government, State Governments and other sums which may be received for being credited to it from any source.   Provision  is being made for payment of compensation only in cases of death or grievous hut as defined in the Indian Penal Code.  The compensation payable in respect of death of a person in a hit­and­run motor accident will be a fixed sum of Rs.5,000/­ while the compensation payable in case of grievous hurt to a person is a fixed sum of Rs.1,000.  In the event of the identity of the motor vehicle   involved   in   the   accident   becoming   subsequently   found   out   and compensation   being   recovered  through  the  Claims   Tribunal   or   court  or other authority in respect of the death of or for grievous hurt to any person for   which   compensation   has   been   paid   from   the   Solatium   Fund,   the compensation paid from the Solatium Fund will have to be refunded to the Fund.   The provision is also being made for the making of a scheme to provide for the authority in which the Solatium Fund shall vest, for the administration of the Solatium Fund and for all matters connected with payment of compensation from the Solatium Fund [vide clauses 14 and 18(a)]. (c) It   is   proposed   to  make  it   compulsory   for   every   person   driving   a motor   vehicle   to   have   his   photograph   affixed   on   his   licence.     Suitable provision is also being made for giving sufficient time for existing holders of driving licences to have their photographs affixed on their licences (vide clauses 2, 3, 4, 5 and 27). It   is   proposed   to   make   it   compulsory   for   persons   driving   motor (d) vehicles to keep their driving licences in their possession on all occasions while driving.  This will enable speedy detection of persons driving vehicles without licences (vide clause 10). (e) With a view to ensuring uniformity in respect of display of figures in the registration marks of vehicles, it is being provided that such figures shall be in Arabic numerals (vide clause 6). (f) The   power   to   prescribe   registered   laden   wights   and   safe   axle weights   for   transport   vehicles,   which   is   at   present   with   the   State Governments, is being transferred to the Central Government with a view FA/1683/2005 JUDGMENT to securing uniformity (vide clause 7). The   power   to   make   rules   with   respect   to   specifications   for (g) construction, equipment and maintenance regarding length, width, height, etc., size, nature and condition of tyres of vehicles which is at present with the  State   Governments,   is   being   transferred   to  the   Central   Government with a view to achieving uniformity (vide clauses 8 and 9). (h) With regard to third party insurance risk, the insurance liability is, at present, fixed under the Act with reference to the vehicle as a whole. This   is   proposed   to   be   altered   in   the   case   of   public   service   vehicles   to provide a limit with reference to the passengers.  The limit with respect to the insurers' liability to a passenger involved in an accident in a public service   vehicle   is   being   fixed   at   Rs.15,000/­.     The   existing   limits   of insurance liability in respect of goods vehicles as also damage to property are proposed to be raised (vide clause 13). (i) A specific offence is being provided for to cover cases of driving of motor vehicles in contravention of sections 3 and 4 of the Act (vide clause 21). (j) With  a view to speedy disposal of cases, provision is being made for compounding of certain offences under the Act.  This provision would also apply to pending cases (vide clause 26). (k) The punishment by way of fine for offences under sections 113A, 115(1), 116, 120 and 123 are proposed to be raised (vide clauses 20 and 22 to 25).

3. The Bill seeks to achieve the above objects.” 23 Chapter X deals with liability without fault   in   certain   cases.     Section   140 corresponding   to   Section   92­A   of   Motor Vehicles   Act,   1939   (Chapter   VII­A)   provides for   liability   for   payment   of   compensation without fault in cases of death or permanent disability   departing   from   principle   of   fault liability.   Section 140 envisages where death FA/1683/2005 JUDGMENT or   permanent   disablement   of   any   person   has resulted   from   accident   arising   out   of   motor vehicle or motor vehicles, the owner(s) shall be   jointly   and   severally   liable   to   pay compensation.     Extent   of   amount   payable   is prescribed   in   subsection   (2).     Making   the claim   under   principle   of   no   fault   liability under Section 140, claimant is not required to plead   and   establish   that   the   death   or permanent disablement in respect of which the claim is made was the result of any wrongful act on the part of owner(s) of the vehicle(s) concerned   or   any   other   person.     The   claim cannot be defeated by reason of any wrongful act,   neglect   or   default   of   the   victim   of accident nor shall the quantum be reduced for negligence.     Subsection   (5)   of   Section   140 provides that in addition to the compensation awardable   under   subsection   (2),   owner   of   the vehicle   shall   be   liable   to   pay   compensation under   any   other   law   for   the   time   being   in force.     Where   compensation   is   claimed   and awarded   under   such   other   law,   it   shall   be FA/1683/2005 JUDGMENT reduced   from   compensation   paid   under subsection (2) of Section 140 or under Section 163­A.     Conclusion   irresistible   is   where compensation   is   not   claimed   under   any   other law,   reduction/recovery   does   not   arise. Subsection (2) of Section 141 provides that a claim   for   compensation   under   Section   140   in respect   of   death   or   permanent   disablement   of any   person   shall   be   disposed   of   as expeditiously   as   possible   and   where compensation   is   claimed   in   respect   of   such death   or   permanent   disablement   under   Section 140 and also in pursuance of any right on the principle   of   default,   the   claim   for compensation   under   Section   140   shall   be disposed   of   in   the   first   place.     Subsection (3) of Section 148 provides that compensation paid   under   Section   140   shall   be   adjusted against   the   higher   amount   of   compensation payable on the principle of fault and that if the   compensation   payable   on   the   principle   of fault is less than compensation payable under Section   140,   the   compensation   under   fault FA/1683/2005 JUDGMENT liability is not required to be paid.   There is   no   provision   requiring   the   claimant   to refund   the   amount   paid   under   Section   140. Section   142   defines   permanent   disablement while Section 144 accords overriding effect to the provisions of this Chapter notwithstanding anything   contained   in   any   other   provision   of this   Act   or   of   any   other   law   for   the   time being   in   force.     This   Chapter,   therefore, stands   apart   from   other   Chapters   and   from other provisions of law for the time being in force.  Therefore, it is independent, workable as   such,   the   limitation   being   where compensation   has   also   been   given   under   any other law, compensation awarded under Section 140   is   reducible   provided   the   compensation awarded under any other law is higher and that where both claims, one under Section 140 and the other under Section 166 or under Section 163­A, are filed claim for compensation under Section 140 shall be disposed of in the first place,   rightly   so,   because   amount   paid   under Section   140   is   reducible   from   the   amount   of FA/1683/2005 JUDGMENT compensation   paid   under   any   other   provision, but there is no provision requiring filing of applications   under   no   fault   liability   and under   fault   liability   together   nor   there   is provision   against   maintainability   of application   under   Section   140   in   the   absence of application under Section 166.   Chapter XI provides   for   insurance   of   motor   vehicles against   third   party   risks.     Sub   clause   (c) inhibits liability in respect of Section 140. Whose   liability,   obviously,   the   liability   of the tort feaser and the insurance company with which   the   vehicle   is   insured.     Section   149 provides   for   duty   of   insurer   satisfying judgements and awards against persons insured in respect of third party risks.   Subsection (2) thereof mentions the defences available to the insurance company.  Explanation in Section 149   refers   to   Claims   Tribunal   constituted under   Section   165   and   “award”   made   by   the Tribunal   under   Section   168.     Section   161 provides for compensation in cases of hit and run   motor   accidents,   names   contributors, FA/1683/2005 JUDGMENT framing   of   scheme   (under   Section   163)   and payment   to   victims   to   the   extent   stated   in subsection   (3).     Section   162   provides   for refund of this compensation to the extent and in   the   circumstances   stated.     Section   163­A provides   for   payment   of   compensation   on structured   formula   basis.     Subsection   (2) thereof   is   similar   to   Section   140(2)   and provides   that   in   any   claim   for   compensation under   subsection   (1)   of   Section   163­A,   the claimant   shall   not   be   required   to   plead   or establish   that   the   death   or   permanent disablement in respect of which the claim has been   made   was   due   to   any   wrongful   act   of   or neglect or default of the owner of the vehicle or vehicles concerned or of any other person. It   is   noticeable   that   the   Act   provides   for compensation, in no fault liability (Sec. 140, Chapter   X),   in   hit   and   run   motor   accidents (Sec.161   Chapter   XI)   and   fault   liability payable, on structured formula basis (Sec.163­ A   Chapter   XI)   and   under   Section   166.       For adjudication   of   these   claims,   Section   161 FA/1683/2005 JUDGMENT provides   for   Claims   Tribunals   (Chapter   XI). Proviso   to   subsection   (2)   of   Section   166 requires that where no claim for compensation under   Section   140   is   made,   such   application shall   contain   a   separate   statement   to   that effect immediately before the signature of the applicant.  This is to meet the requirement of proviso to subsection (5) of Section 140 and subsection (2) of Section 141.  Since Tribunal has   to   award   just   compensation   under   Section 168   and   avoid   unjust   enrichment   of   the claimant,   proviso   to   Section   168   makes   it clear that where application under Section 166 makes claim for compensation under Section 140 in   respect   of   the   death   or   permanent disablement of any person, such claim and any other claim, whether made in such application or otherwise, for such compensation in respect of such death or permanent disablement, shall be   disposed   of   in   accordance   with   the provisions of Chapter X.  Therefore, intention of legislature is that claim under Section 140 is   triable   in   accordance   with   the   provisions FA/1683/2005 JUDGMENT of   Chapter   X,   which   is   summary   in   nature. Such   a   claim   requires   to   be   disposed   of   as expeditiously as possible so that compensation is available to the victim as compared to long trial   of   claim   under   Section   166  r.w.  Rules 211 to 229,  The Gujarat Motor Vehicles Rules, 1989,   and   for   summary   procedure   for   paying compensation   on   the   principle   of   no   fault liability in Section 140 r.w. Rule 231, which fortifies   the   conclusion   that   Section   140   is independent of Section 166. 24 Having   taken   the   bull   by   horns, conclusions   irresistible   may   be   summarized. Section   140   (Chapter   X))   provides   for   fixed sum   of   compensation   in   cases   of   no   fault liability.   It is independent of Section 161 (payment of compensation in cases of hit and run   motor   accidents),   Section   163­A   (payment of   compensation   on   structured   formula basis/fault   liability   –   Chapter   XI)   and Section   166   (fault   liability   –   Chapter   XII). Application for compensation under Section 140 FA/1683/2005 JUDGMENT is   maintainable   without   there   being application   for   compensation   under   Section 163­A   or   under   Section   166   and   disposable accordingly, and compensation awarded shall be final.   But,   where   two   applications   are   filed under Section 140 and 163­A or under Section 140   and   under   Section   166,   compensation awarded   under   Section   140   shall   be   reduced from the amount of compensation awarded under Section   163­A   or   under   Section   166   provided the   compensation   awarded   under   the   latter provisions are higher, otherwise, compensation paid   under   Section   140   would   be   final. Further,   where   claim   is   preferred   only   under Section   140   and   not   any   other   provision, compensation   awarded   under   Section   140   shall be   final.     Section   140   does   not   provide   for interim/ad­hoc compensation because compensation paid under this Section is final. `Interim/ad­hoc   compensation'   is   used   when apart from application under Section 140 there is   also   application   under   Section   163­A   or under   Section   166,   since   the   amount   of FA/1683/2005 JUDGMENT compensation   paid   under   Section   140   is   made deductible.   Where in addition to application for   compensation   under   Section   140   there   is application   under   other   provisions   on principle   of   fault   liability,   application under Section 140 shall be disposed of in the first   place,   since   expeditious   disposal   of application   under   Section   140   is   the   basic theme of this beneficial piece of legislation. But,   where   claimant   has   filed   application under   Section   140,   but   not   under   any   other provision   claiming   compensation   on   fault liability   principle,   application   is maintainable   and   compensation   awardable,   but not   recoverable   from   the   claimant.     The insurance   company   is   not   entitled   to   seek trial on merit of any legal defences available to it under Section 149(2) of the Act.  Remedy of insurance company is against the owner of the vehicle invoking defences available to it, but not against the claimant.   Law laid down by   this   Court   in  Munshiram   D.Anand   Vs.   Pravinsinh Prabhatsinh Anand Society, Navagamgedh, Jamnagar (Coram: S.D. FA/1683/2005 JUDGMENT Shah J.) (AIR 1997 GUJARAT 60), United India Insurance Co. Ltd. Vs. Maganlal Hirabhai Patel and others (S.D. Shah J.) (1999 ACJ 268),  New   India   Assurance   Co.   Ltd.   Vs.   Mithakhan  Dinakhan Notiyar  (Coram:   J.M.   Panchal   J.)  (1995(2)   GLR   1111), Mahendrakumar  Kalyanjibhai  Vs.  Haresh  Bipinchandra  Pathak (Coram:   M.S.   Shah   J.)   (1998(2)   GLR   1199)  and   Division Bench   in  New   India   Assurance   Co.   Ltd.   vs.   Babubhai Purshottambhai Harijan and others (F.A.No.133 of 2006 with C.A. 527 of 2006) (Coram: Bhawani Singh C.J. and Abhilasha Kumari J.) is   correct,   contentions   to   the   contrary untenable.  Reference is answered accordingly. What   emerges   out   of   the   aforesaid conclusion is that there is no merit in these appeals.     They   are   dismissed   leaving   the parties   to   bear   respective   costs   of   these appeals. (BHAWANI SINGH) CHIEF JUSTICE (H.K. RATHOD) JUDGE (ABHILASHA KUMARI) FA/1683/2005 JUDGMENT JUDGE Since we have dismissed the Appeals, Shri Nanavati seeks stay of the judgment, which we hereby decline. (BHAWANI SINGH) CHIEF JUSTICE (H.K. RATHOD) JUDGE (ABHILASHA KUMARI) JUDGE [SN DEVU]