High Court
Facts
FA-1412-19+1.odtIN THE HIGH COURT OF JUDICATURE AT BOMBAYBENCH AT AURANGABADFIRST APPEAL NO. 1412 OF 2019ANDCIVIL APPLICATION NO. 5472 OF 2019Bajaj Allianz General Insurance Co. Ltd.Through its Branch Manager,A/p. Sundar Arcade, Kadbi Mandi, Jalna,Tq. & Dist. Jalna..APPELLANTVERSUS1. Manohar Jadamal Wadhava Age: 56 years, Occu.: Nil,2. Bharti Manohar Wadhava Age: 51 years, Occu.: Household, Both R/o S.R.P. Road, Nath Nagar, Behind Radhakrishna Mandir, Jalna, Tq. & Dist. Jalna3. Yogesh Prakash Ghodke Age: 43 years, Occu.: Truck Owner, R/o Chikurde, Tq. Walwa, Dist. Sangli4. Shabbir Annu Shaikh Age: 30 years, Occu.: Driver, R/o Bawdhan, Tq. Wai, Dist. Satara..RESPONDENTSANDFIRST APPEAL NO. 824 OF 20211. Manohar Jadamal Wadhava Age: 56 years, Occu.: Nil,2. Bharti Manohar Wadhava Age: 51 years, Occu.: Household, Both R/o S.R.P. Road, Nath Nagar, Behind Radhakrishna Mandir, Jalna, Tq. & Dist. Jalna..APPELLANTVERSUS1 / 14 FA-1412-19+1.odt1. Bajaj Allianz General Insurance Co. Ltd. Through its Branch Manager, A/p. Sundar Arcade, Kadbi Mandi, Jalna, Tq. & Dist. Jalna Through its signatory/Branch Manager, ABC Complex, MIDC, Chikalthana, Near Prozone Mall, Aurangabad, Tq. & Dist. Aurangabad2. Yogesh Prakash Ghodke Age: 43 years, Occu.: Truck Owner, R/o Chikurde, Tq. Walwa, Dist. Sangli3. Shabbir Annu Shaikh Age: 30 years, Occu.: Driver, R/o Bawdhan, Tq. Wai, Dist. Satara..RESPONDENTS....Mr. M.R. Deshmukh, Advocate for appellant in FA/1412/2019 and forrespondent no. 1 in FA/824/2021Mrs. L.R. Thakur, Advocate for respondent nos. 1 and 2 in FA/1412/2019and for appellants in FA/824/2021Mr. M.V. Salunke, Advocate h/f Mr. V.D. Salunke, Advocate for respondentnos.3 and 4 in FA/1412/2019 and for respondent nos.2 and 3 in FA/824/2021....CORAM : R.G. AVACHAT AND NEERAJ P. DHOTE, JJRESERVED ON : 30th AUGUST, 2024PRONOUNCED ON : 04th SEPTEMBER, 2024JUDGMENT (PER : R.G. AVACHAT, J. ) :1.Present appeals arise from a judgment and award dated 31stJanuary, 2019 passed by the Member of Motor Accident Claims Tribunal,Jalna (‘MACT’) in Motor Accident Claim Petition, No. 20 of 2018 (‘MACP’).2.First Appeal, No. 1412 of 2019, has been preferred by BajajAllianz General Insurance Co. Ltd. (original Respondent No.3). Thesubsequent appeal has been preferred by the original claimants, who2 / 14 FA-1412-19+1.odtpreferred original petition for compensation on account of death of their son –Gautam, in an accident involving a motor vehicle on 06th March, 2016. Forthe sake of convenience, the parties are referred to as per their status in theMACP and First Appeal, No. 824 of 2021. In short, the appellants in theseappeals would be referred to as claimants and the others as respondents, asper their serial numbers in the MACP.3.The facts, in brief, giving rise to the present appeals are asfollows:-Gautam (deceased) was the only son of the claimants. He was inthe age groups of 24-25 years. On 06th March, 2016, he was on his wayback home to Jalna alongwith his friend in a motor vehicle, Honda Amaze,MH-21-V-7125. While their car was passing along Bangalore-Pune highwaynear village Kini, a milk tanker, MH-10-AW-2020, being driven byRespondent No.2 (‘driver’), first hit the road divider. The tanker jumped thedivider and dashed against Honda Amaze car, Gautam was traveling in. Asa result of the accident, Gautam died.4.The tanker belonged to Respondent No.1 at the relevant time. Ithad an insurance cover granted by Respondent No.3 – insurance company.5.The claimants (parents of Gautam) preferred the MACP with theaverments therein that Gautam was a post-graduate in BusinessAdministration. He was working as an agent. Income-tax returns for the two3 / 14
Legal Reasoning
FA-1412-19+1.odtSince Gautam died bachelor, 50% thereof (total income) was deductedtowards his personal and living expenses. There is no dispute aboutapplying the multiplier considering the age of the deceased. LearnedMember arrived a a figure of Rs.1,26,01,206/- towards loss of dependency.Rs.15,000/- each has been awarded for funeral expenses and loss of estate,rightly so. In view of the directions of the Apex Court in case of PranaySethi’s case (supra), the parents of the deceased were entitled forcompensation on account of loss of filial consortium. In this case, both theclaimants were independently entitled for Rs.40,000/-. Learned Member,however granted in all Rs.40,000/-. In our view, therefore, the claimants areentitled for additional sum of Rs.40,000/- towards filial consortium. As such,the total amount of compensation awarded by the MACT gets enhanced byRs.40,000/- only. We answer the point accordingly.POINT NO. (iii) :16.It has been directed to pay interest @ 12% p.a. on the amount ofcompensation from the date of filing of the petition to the date of realisation ofthe entire amount. Learned Member relied on the judgment of Apex Court incase of Magma General Insurance Co. Ltd. Vs. Nanuram @ Chuhru Ramand Ors., (2018) 18 SCC 130 .17.In case of National Insurance Co. Ltd. Vs. Mannat Johal andOrs., AIR 2019 SC 2079, it has been observed in paragraph no.13, asunder :-11 / 14 FA-1412-19+1.odt“13. ...The Tribunal had awarded interest at the rate of 12% p.a. but thesame had been too high a rate in comparison to what is ordinarilyenvisaged in these matters. The High Court, after making a substantialenhancement in the award amount, modified the interest component at areasonable rate of 7.5% p.a. and we find no reason to allow the interestin this matter at any rate higher than that allowed by High Court.”18.Moreover, in case of Dharmpal and Ors. Vs. U.P. State RoadTransport Corporation, (2008) 12 SCC 208, it has been held as under :-“8. As per Section 171 of the Motor Vehicle Act, 1988 (hereinafterreferred as 'Act') where the claim for compensation made under the act isallowed by the Claims Tribunal, the tribunal may direct that in additionto the amount of compensation simple interest shall also be paid at suchrate from such date not earlier than the date of making claim.9. In National Insurance Co. Ltd. v. Keshav Bahadur reported in AIR2004 SC 1581 this Court has held that the provisions require payment ofinterest in addition to compensation already determined. Even thoughthe expression "may" is used, a duty is laid on the Tribunal to considerthe question of interest separately with due regard to the facts andcircumstances of the case. It was clearly held in the said decision that theprovision of payment of interest is discretionary and is not and cannot bebound by rules.10. Interest is compensation for forbearance or detention of money,which ought to have been paid to the claimant. No rate of interest isfixed under Section 171 of the Act and the duty has been bestowed uponthe court to determine such rate of interest. In order to determine suchrate we may refer to the observations made by this Court over the years.In the year 2001 in the case of Kaushnuma Begaum (Smt.) and Ors. v.New India Assurance Co. Ltd. and Ors. reported in [2001] 1 SCR 8 onthe question of rate of interest to be awarded it was held that earlier,12% was found to be the reasonable rate of simple interest but with achange in economy and the policy of Reserve Bank of India the interestrate has been lowered and the nationalized banks are now grantinginterest @ 9% on fixed deposits for one year. Accordingly, interest @ 9%was awarded in the said case. We may at this stage also refer to thefollowing observations of their Lordships in the aforesaid decision whichare relevant to the present case:24. Now, we have to fix up the rate of interest. Section 171 of theMV Act empowers the Tribunal to direct that 'in addition to the12 / 14 FA-1412-19+1.odtamount of compensation simple interest shall also be paid at suchrate and from such date not earlier than the date of making theclaim as may be specified in this behalf'. Earlier, 12% was found tobe the reasonable rate of simple interest. With a change ineconomy and the policy of Reserve Bank of India the interest ratehas been lowered. The nationalized banks are now grantinginterest at the rate of 9% on fixed deposits for one year. We,therefore, direct that the compensation amount fixed hereinbeforeshall bear interest at the rate of 9% per annum from the date ofthe claim made by the appellants....11. In the year 2002, in United India Insurance Co. Ltd. and Ors. v.Patricia Jean Mahajan and Ors. reported in [2002] 3 SCR 1176 thisCourt held that the interest is payable on the equitable grounds to theaggrieved person who is deprived of using the money which is due andpayable to him. Following the observations made in the case ofKaushnuma Begaum (supra) interest @ 9 % was awarded in this casealso. It was held as follows:39. In our view the reason indicated in the case of KaushnumaBegum (supra) is a valid reason and it may be noticed that the rateof interest is already on the decline. We therefore, reduce the rateof interest to 9% in place of 12% as awarded by the High Court.12. In the year 2003 in the case of Abati Bezbaruah v. Dy. DirectorGeneral, Geological Survey of India and Anr. reported in [2003] 1 SCR1229 it was held that the question as to what should be the rate ofinterest, in the opinion of this Court, would depend upon the facts andcircumstances of each case. Award of interest would normally dependupon the bank rate prevailing at the relevant time. After referring to theaforementioned decisions interest @ 9% was awarded in the said case.13. However, in the year 2005 in Tamil Nadu State TransportCorporation Ltd. v. S. Rajapriya reported in AIR 2005 SC 2985 thisCourt again taking note of the then prevailing rate of interest on bankdeposits directed for lowering the rate of interest fixed by the Tribunalat 9% per annum and altered the same to 7.5% per annum.18. The accident in the present case took place on 06th March, 2016.None of the parties to these appeals brought to our notice what was therate of interest on bank deposits in the year 2016. In our view, grant ofinterest @ 12% p.a. was excessive and exorbitant. We, therefore,reduce the same to Rs.8% p.a.”13 / 14
Arguments
FA-1412-19+1.odtyears preceding his death and one of the year in which he breath his lastwere produced in evidence. Income of the deceased was increasing eachyear. Learned Member of the MACT, considering the income tax returns ofthe year preceding the year in which he passed away took into considerationand awarded compensation by applying multiplier, in view of the age of thedeceased. Since Gautam died bachelor, learned Member deducted one halfof the annual income of the deceased towards his personal and livingexpenses, after adding 40% of the annual income towards future prospect, inview of direction no.(iv) given by the Constitution Bench of the Apex Court incase of National Insurance Co. Ltd. Vs. Pranay Sethi and Ors., AIR 2017SC 5157. The total amount of compensation awarded by the learnedMember is Rs.1,26,71,206/- to be paid with 12% interest thereon from thedate of filing of the petition till its realisation. The amount of compensationwas directed to be paid by Respondent Nos. 1 and 3 jointly and severely.6.Learned counsel for the claimants would submit that only one ofthe claimants was granted Rs.40,000/- towards loss of consortium. Accordingto her, the deceased died bachelor. Nothing has been awarded on accountof loss of marriage prospect. According to learned counsel, the income ofthe deceased, as is appearing in the income tax returns filed in the year inwhich he breath his last, ought to have been taken into consideration forgrant of compensation. She would further submit that since the deceasedwas the only child of the claimants and loss of life could not be valued interms of money, the claim ought to have been granted in toto . According to4 / 14 FA-1412-19+1.odther, there is even no reason for this Court to interfere with the rate of intereston amount of compensation.7.Learned counsel for Respondent No.3 – insurance companywould, on the other hand, submit that a specific defence was raised in thewritten statement regarding the driver of the offending truck to have had novalid and effective license to drive the tanker at the relevant time. Learnedcounsel has relied on a judgment of the Apex Court in case of Pappu andOrs. Vs. Vinod Kumar Lamba, AIR 2018 SC 592. He then took us throughthe evidence of an officer from the office of RTO, Satara. According to him,two driving licenses of same number can not be issued in one year. Thedriving license produced on record was fake. There was no evidenceadduced by the owner of the vehicle to show that after having inspected thedriving license of Respondent No.2, he employed him as a driver on histanker. Date dates of issuance of said license were adverted to. Accordingto learned counsel, Respondent No.2 obtained the license to drive a PublicServices Utility Vehicle (‘PSUV’) in December 2011. The Motor Vehicles Act,1988 (‘MV Act’) defines the term of PSUV independently. There is nothing toindicate him to have had a valid and effective driving license to drive theheavy vehicle like milk tanker. Learned counsel then submitted that theMACT has granted exorbitant rate of interest on the amount ofcompensation. He ultimately urged for allowing the insurance company’sappeal.5 / 14 FA-1412-19+1.odt8.Learned counsel for the tanker owner would, on the other hand,submit that evidence of the witness examined on behalf of Respondent No.3– insurance company itself indicates that the driver was holding a valid andeffective driving license. The license issued in his name was first in point oftime. Another license of the same number was issued in a camp held atFaltan, Dist. Satara by the office of RTO, Satara. He would further submitthat the driver was examined as a witness on behalf of Respondent No.3 –insurance company. The driver had come with his driving license andadmitted in his cross-examination to have had held a valid and effectivedriving license. According to him, Respondent No.3 – insurance companyfailed to make out the defence of the driver to have had no valid and effectivedriving license to drive the tanker when it met with the accident on the giveday. He supported the impugned judgment and award.9.Considered the submissions advanced. Perused the evidence onrecord and the judgment impugned herein.10.Following points arise for our consideration :-(i)Did the insurance company prove Respondent No.2 –driver did not hold valid and effective driving license at therelevant time? If yes, what is its consequence?(ii)Whether the claimants are entitled for enhancement ofcompensation?(iii)Whether Respondent No.3 – insurance company provedthe rate of interest on the amount of compensation isexorbitant, and therefore, need to be scaled down?(iv)What order?6 / 14 FA-1412-19+1.odtREASONS : POINT NO. (i) :11.The offending vehicle i.e. the milk tanker falls within the categoryof heavy vehicle. It was also a transport vehicle. License (Exh.24) ofRespondent No.2 - driver indicates that it was issued on 10th January, 2008.The license was renewed on 01st April, 2014. He was authorised to drive thetransport vehicle from 27th March, 2017. He was authorised to drive PUSVwith effect from 05th December, 2011. True, Section 2(35) of the MV Actdefines ‘Public Service Vehicle’ to mean any motor vehicle used or adaptedto be used for the carriage of passengers for hire or reward, and includes amaxicab, a motocab, contract carriage and stage carriage. From thedefinition itself it indicates the same to be a different category of vehicle.Sub-section (47) of the very Section defines the term ‘Transport Vehicle’which means a public service vehicle, a goods carriage, an educationalinstitution bus or a private service vehicle. While Sub-section (16) thereofdefines ‘Heavy Goods Vehicle’ to mean any goods carriage the gross vehicleweight of which, or a tractor or a road-roller the unladen weight of either ofwhich, exceeds 12,000 kgs. By no stretch of imagination it could be said thatthe tanker involved in the accident was not a Heavy Goods Vehicle, besidesbeing a Transport Vehicle.12.Respondent No.3 – insurance company examined D.W.1 –Yuzavendra, an employee from the office of RTO, Satara. He appearedbefore the Court in response to a summons issued at the instance ofRespondent No.3 – insurance company. It is in his evidence that on 17th7 / 14 FA-1412-19+1.odtJanuary 2008, RTO, Satara issued a driving license, no. 388 in the name ofSudam Dashrath Kate. It was pertaining to authorising him to drivemotorcycle and car. The said license was issued manually. A true copythereof was filed at Exh.68. He had brought before the Court original record.He was categorical to state that in one calender year no two driving licensesof the same number could be issued.This witness was subjected to a searching cross-examination,wherein he testified that the license in the name of Sudam Kate was issuedin a camp held at Faltan (taluka place). He tendered in evidence the drivinglicense issued in the name of Respondent No.2 (driver). The same findsplace at Exhibit 69. According to him, the said license was issued on 10thJanuary, 2008 i.e. seven days before the license was issued in the name ofSudam Kate. True, both the licenses bear the same number, 388. The fact,however is that the license issued in favour of Respondent No.2 is first inpoint of time. The license in the name of Sudam Kate was issued manuallyin a camp held at Faltan. According to this witness, entire record of the officeof RTO Satara has been computarized in the year 2007. He was categoricalto state that computarization was done of the record pertaining to the mainoffice of RTO Satara. According to him, both the licenses (Exh.68 and 69)were altogether different. The license issued in favour of Respondent No.2authorized him to drive motorcycle, Light Motor Vehicle and Heavy MotorVehicle as well. According to this witness, Respondent No.2 was authorizedto drive PSUV in the year 2012. This witness was categorical to state thatRespondent No.2 was authorized to drive truck, bus, tempo and tanker vide8 / 14 FA-1412-19+1.odtlicense (Exh.25). According to him, the said license was issued to him by hisoffice (RTO, Satara).13.He also tendered in evidence a communication (Exh.66) issued bythe Deputy Regional Transport Officer, Satara reinforcing his oral evidencebefore the Court. What was referred to by learned counsel for the insurancecompany was a history sheet pertaining to the driving license/s issued infavour of Respondent No.2 time to time. Insurance company then examinedRespondent No.2 (driver) as its witness. During his cross-examination, headmitted to have had held a valid and effective driving license. The evidenceof an employee of RTO Satara has specifically deposed to that RespondentNo.2 had obtained a license in the year 2012 to drive taxi and buses, so hewas authorized to drive truck, bus, tempo and tanker. Exhibit 24 is the saidlicense.14.The fact that Respondent No.2 hold a license to drive heavyvehicles like truck, bus, tempo and tractor since before the accident tookplace, goes a long way to conclude Respondent No.3 – insurance companyto have failed to make out its defence that Respondent No.2 – driver did nothold valid and effective driving license and as such, it was a breach of termsand conditions of the policy of insurance. When the witness examined on itsbehalf categorically testified that both the licenses issued in the name ofSudam Kate and Respondent No.2 are valid and effective, the witness wasnot cross-examined by the insurance company which had called him as its9 / 14 FA-1412-19+1.odtwitness. At the cost of repetition it is observed that the license issued inrespect of Respondent No.2 is first in point of time than the one issued in thename of Sudam Kate and the same, therefore, could not be termed to be afake license.POINT NO.(ii) :15.Deceased - Gautam died bachelor. He was in the age group of24-25 years. Three income tax returns, two of the years next before the yearhe breath his last while the third one pertains to the year in which he passedaway. Those income tax returns find place at Exhibits 44, 45 and 46respectively. Learned Member relied on the judgment of the Apex Court incase of V. Subbalakshmi and Ors. Vs. S. Lakshmi and Anr., 2008 ACJ936 [Supreme Court], to ignore the income tax return of the year in whichGautam passed away. The earlier two returns pertain to the financial years2013-14 and 2014-15. The annual income of the deceased shown in thosereturns was Rs.11,61,379/- and Rs.12,01,471/- respectively. LearnedMember relied on the income tax return for the year next before the year inwhich Gautam passed away. After considering the statutory deduction suchas income tax and professional tax, learned Member considered annualincome of the deceased at Rs.9,98,965/-. It added thereto a sum ofRs.1,130/- since the deceased had received refund. Thus, annual income ofthe deceased for calculating the compensation comes to Rs.10,00,095/-. Inview of direction no. (iv) given by the Apex Court in the case of Pranay Sethi(supra), the Member of MACT added 40% thereof towards future prospect.10 / 14
Decision
FA-1412-19+1.odt19.In view of above, both the appeals stand disposed of as partlyallowed in terms of following order :(I)The amount of compensation awarded by the Tribunalstands enhanced by Rs.40,000/- i.e. Rs.1,26,71,206 +Rs.40,000/- = Rs.1,27,11,206/-. (Rupees One Crore,Twenty Seven Lakhs Eleven Thousand Two Hundred Six)(II)The direction in the award to pay interest @ 12% p.a. onthe amount of compensation from the date of filing ofpetition to the date of actual payment is modified by figure8% p.a. instead of 12% p.a.(III)It is informed that the insurance company has depositedentire amount under the impugned award with this Court.The claimants had been permitted to withdraw 50% thereof.The balance amount in deposit with this Court immediately(forthwith) be paid to the claimants in terms of modifiedaward with the interest accrued thereon.(IV)The balance amount, if any, be paid back to the insurancecompany, necessarily with the interest accrued thereon.(V)Civil application stands disposed of accordingly.(VI)Parties to act upon authenticated copy of this order so faras regards disbursement of remaining amount to be paid tothe claimants.( NEERAJ P. DHOTE, J. )( R.G. AVACHAT, J. ) SSD14 / 14