The New India Assurance Co. Ltd v. Smt. Bali Devi wd/o Sh. Mahabir Sharma Shastri & Ors.

Judgment

1. The genesis This batch of 20 appeals arise out of the same accident. As per the version of the claimants, there were several persons travelling in a goods carriage, carrying with them 50 kgs sugar, huge quantity of wheat, atta etc. from Ludhiana to Sirsa to meet with Swami Dera Sacha Sauda. The motor vehicle struck against a camel and it turned trutle. The accident resulted in six deaths and 10 FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -2- persons were injured. II.

2. Contentions urged by insuer The insurance company had two grounds to urge before the Tribunal. One, that the driver did not have a valid driving licence and two, the vehicle did not have a permit to transport goods. At the trial, a notice was given to the owner by the insurer to produce the route permit. The owner received a notice but failed to produce the same. This aspect has also been recorded by the Tribunal in its proceedings. The insurance company was, however, made liable finding that the insurance company had not established that the driver did not have a valid driving licence. The insurance company urged at the time of arguments that all the persons, who either died or were injured, have been gratuitous passengers in a goods carriage and therefore, the insurer was liable, for there was no policy cover for risk to bodily injury or death to such passengers. The Tribunal took note of the fact that they were all owners of the goods and they were entitled to be statutorily protected even under the Act Policy under Section 147 of the Motor Vehicles Act. Compensation had been awarded to various sums for death and injuries. It is this award, which is assailed in appeal by the insurer and being made subject of cross appeals for enhancement by the claimants. III. Situation of owners of goods with goods (a) Purpose of journey, whether relevant

The learned counsel Mr. Ashwani Talwar contends that there was no liability on the insurer in the first place, for there was FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -3- no requirement to cover the risk of gratuitous passengers and the primary purpose of travel for all these passengers were a religious journey to meet with their religious Guru and the fact that there were also goods in the vehicle were merely incidental to the travel. The purpose of the engagement of the goods carriage itself was only to obtain personal transport for themselves, treating the vehicle as a passenger vehicle and therefore, the insurance company would not be liable. Learned counsel relies on a judgment of the Hon'ble supreme Court in National Insurance Company Limited Vs. Rattani and others (2009) 2 SCC 75. The Hon'ble Supreme Court was dealing with the case of an Act Policy to examine whether it covered the risk to representatives of owner of goods, who were members of marriage party travelling in truck and transporting gift articles received from the bride's side. The Hon'ble Supreme Court held that such gift articles cannot partake the character of goods in the manner defined under the Motor Vehicles Act and as a matter of fact, held that even the existence of gift articles in the vehicle concerned had not been established. The Hon'ble Supreme Court, therefore, found that the victims of the accident were travelling in the truck as gratuitous passengers and exonerated the insurance company by vacating the judgment of the High Court that found the insurer liable. (b) Lack of permission from authorities to transport goods

4. The learned counsel also argued that the transport of these goods had not been with any permission from the authorities from FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -4- the department of Food and Civil Supplies and the articles could not have been validly transported without any specific permit from the RTO Authorities as well. There was no receipt issued even by the truck owner for the receipt of goods. If the issue was whether goods were transported or not and one party was interested in denying that they were not, while another would affirm the same, the proof of such transport issue receipts would become relevant. On the other hand, if the transport of goods in the vehicle was an admitted fact, then it is irrelevant that there was no receipt issued by the owner or no permission had been taken from any authorities for such transport. (e) Meaning of goods-they do not include luggage or personal effects

5. All that has to be seen is whether the goods that were transported fell within the definition of goods as defined under the Motor Vehicles Act. It is defined under Section 2(13) of the Motor Vehicles Act as under:- “2 (13) "goods" includes live-stock, and anything (other than equipment ordinarily used with the vehicle) carried by a vehicle except living persons, but does not include luggage or personal effects carried in a motor car or in a trailer attached to a motor car or the personal luggage of passengers travelling in the vehicle.”

6. This definition is important in one sense for it does not include a luggage or personal effects carried in a car. This is to exclude also a possibility of any one merely carrying his own FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -5- personal luggage in a goods carriage and claiming protection that he was after all accompanying his own goods. The same might also apply to gift articles given to a person, for they may partake the character of personal effects or a personal luggage, which a person could carry with oneself. When the Hon'ble Supreme Court was, therefore, excluding gift articles received from a bride party, I would assume that to be with reference to the definition of goods under Section 2(13). Although I do not find the reproduction of the said Section in the judgment, I would apply the same to this case to exclude the application of the principle laid down in the above judgment. IV.

7. When "goods" were transported, purpose is irrelevant The goods that were being transported certainly were the goods, which have been transported only in goods carriage. Food articles of the quantity that were being transported and which was spoken too by witness PW-19 would definitely show that they qualify within the definition under Section 2(13). I am not prepared to accept the contention made on behalf of the insurer that the predominant purposes determine whether the insurance cover would be available to them or not. Section 147 of the Motor Vehicles Act does not spell out any purpose as being relevant at all. It has to be only seen whether goods were being transported in a goods carriage and the person that is making the claim is the owner or his representative being carried in the vehicle when the goods were also being transported. The decision whether it is predominant or not is FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -6- wholly even subjective, for from the point of view of the owner, it is the human element that may be important because it is through him he collects the money. To a passenger travelling along with the goods, he may choose to go with the goods only for the safety of the goods and the predominant purpose could be only the transportation of such goods. Therefore, I am not prepared to go into the controversy whether the predominant purpose was to transport goods or have darshan of Swamiji.

8. If it is an admitted fact that the goods were being transported and the deceased and the injured persons were all owners of the goods, then they shall be entitled to an insurance cover and statutorily protected through Section 147 of the Motor Vehicles act. Again it will be no argument to make that each one of the travellers in that carriage was not shown to have been the owner of any one particular item. Learned counsel appearing for the insurer would also contend that apart from the evidence of PW-19, no one else has spoken about the ownership of the goods. On the other hand, the learned counsel appearing for the claimants would contend that each one of the insured persons had given evidence of the fact of his own ownership of the goods. The owner of the goods to obtain the benefit of insurance cover need not be shown to be an owner of any one particular item. There is no need to predicate a specific interest in each one of the items of goods. There cannot be a bar to all the persons travelling with the goods having a joint ownership. I would, therefore, affirm the view taken by the FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -7- Tribunal that the persons travelling in the goods carriage were all owners of the goods travelling along with the goods and therefore, they were entitled to be protected by the statutory insurance cover. V. Permit requirements: The concern shall be whether the user was against the prupose. Existence of route permit is irrelevant for insurer

9. Before the Tribunal a demand for production of a permit had been made and it appears that the owner did not produce the same. Under Section 149(2)(a)(i)(c), the permissible defence of the insurer is that the 'condition excluding the use of a vehicle for a purpose not allowed by the permit under which the vehicle is used, where the vehicle is a transport vehicle'. If the vehicle was a transport vehicle then all that the Act requires is that it is used for the purpose for which permit is issued. The permit is required under Section 66 of the Motor Vehicles Act under Chapter V for use as a transport vehicle in any public place. The transport vehicle itself is defined under Section 2(47) that would include use of a vehicle as a public service vehicle or a private service vehicle or an educational institution bus that can carry passengers or a goods carriage that can transport goods. Section 66(3) itself provides the several purposes for which permits would be required. Evidently the vehicle has been registered only as a goods carriage and the policy of insurance also is for a goods carriage. It should be noticed that what Section 149 of the Motor Vehicles Act contemplates is the requirement for a purpose which was not allowed by the permit.

10. If the insurer had provided a policy for a goods carriage, it FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -8- only means that the purpose for which the vehicle could be used was transportation of goods, when what the insurer had demanded at the trial was production of the route permit. Whether a particular vehicle had a route permit or not, will be, in my view, wholly irrelevant for the purpose of Section 149(2) of the Motor Vehicles Act. 'Route' is defined under Section 2(38) of the Motor Vehicles Act and the same is reproduced as follows:- “2 (38) "route" means a line of travel which specifies the highway which may be traversed by a motor vehicle between one terminus and another;”

11. The route permit would be required to ply a particular vehicle in a particular route. The failure of a person to have a route permit may result if it is a stage carriage certain consequences which are set forth under Chapter V of the Motor Vehicles Act and penal consequences under Section 192-A of the Motor Vehicles Act. The said Chapter also contains elaborate provisions about procedure obtaining such permits. Learned counsel appears for the insurer relies on a judgment in National Insurance Co. Ltd. Vs. Challa Bharathamma and others JT 2004 (7) SC 519 where the issue was whether insurer was liable, though the vehicle was being plied without the requisite permit and whether it constituted a breach of condition of the policy. The case was dealt in the context of a claim arising out of an accident involving an auto rickshaw. Auto rickshaw carries passengers and would, therefore, require a permit if it is used for hire. An auto rickshaw could also be used for a private FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -9- purpose for which no permit is necessary. In the particular case, in Challa Bharathamma (supra), the issue was that the vehicle was being used for hire and the Court had to see whether permit had been issued or not. When there was no permit, which the owner was required to hold for use as a transport vehicle, the Hon'ble Supreme Court held that there was a breach of terms of the policy. In this case, the issue is not whether any permit existed or not. If the insurance company is pleading that there was a violation of terms of the policy, the duty shall be on the insurer to prove the same. That proof will be possible only in a case where the insurer makes a specific demand for production namely the permit for the vehicle for transportation of goods. If the insurer was making a demand for route permit and the insured did not produce the same, the only inference that is possible was that the owner did not have a particular route permit. The fact that the owner does not own a route permit is not the same thing as saying that he does not have the permit to transport goods at all unless such a demand had been made and it was failed to be produced by the insured, it cannot be taken that there had been a violation of the terms of the policy. I would, therefore, hold that the non production of a route permit is irrelevant and it has not been shown that there had been any violation of terms of the permit in the manner contemplated under Section 149(2)(i) (c) etc. In my view, the fact that the vehicle which was insured as a goods carriage and the fact that the vehicle was being used for transportation of goods along with persons, who were FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -10- the owners travelling with the goods would itself show that it was not being used for a purpose other than the purpose for which the permit could have been tendered. I, therefore, find that the insurer is squarely liable for the consequences of the accident and bound to indemnify the claim arising out of the accident.

12. All the appeals by the insurance company challenging the liability are, therefore, rejected and the apeals are dismissed. VI.

13. Appraisal of claim for enhancement of compensation There are cross appeals for enhancement of compensation and the learned counsel appearing for the cross appellants would urge his contentions only as regards the claims arising out of death of the persons travelling in the vehicle. I would address, therefore, only those cases which resulted in death.

14. FAO No.5570 of 2005 is a case of death of a person aged 28 years and the claimants were wife, three minor children and mother. He was said to be a Purohit earning Rs.5000/- to Rs.6000/-. The Tribunal took the income to be Rs.2400/-. Incidentally, this was the same amount, which was applied by the Tribunal in every other case. The person, who was supporting a large family of wife, three minor children and mother ought to have had a larger income and I would provide the income to be Rs.3500/- per month. The Tribunal took the deduction of 1/3rd. I would provide for deduction of 1/4th, having regard to the large size of the family and take 3/4th amount as a contribution to the family. The monthly contribution would, therefore, be Rs.2625/- and I would take the annual dependency to FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -11- be Rs.31,500/- per annum. For a person, who was aged 30, appropriate multiplier would have been 17, while the Tribunal the multiplier as 16. The compensation that shall become payable, would be Rs.5,35,500/-. I would add Rs.5,000/- towards loss of consortium and provide for a similar amount of Rs.5,000/- for each one of the children towards of loss of love and affection. I would also provide Rs.2500/- as funeral expenses and Rs.2500/- as loss to estate. In all, the amount that would become payable, would be Rs.5,65,500/-. The Tribunal has already awarded Rs.3,17,200/-. The amount found in excess of what was already awarded shall bear interest @6% from the date of the petition till the date of payment.

15. FAO No.5556 of 2005 relates to a claim for death of a person, who was aged 50 years. He was a mason. The Tribunal had again taken the income to Rs.2400/-. The evidence was that the deceased was earning Rs.200/- per day. I would take the monthly income to be Rs.3000/- on an average and considering the fact that there were two minor children, widow, I would provide a deduction of 1/4th and take the contribution to the family as Rs.2250/-. The annual dependency would be Rs.27000/- and I would adopt a multiplier of 13 to arrive at a compensation of Rs.3,51,000/-. I would add Rs.5,000/- towards loss of consortium and Rs.5,000/- each towards loss of love and affection to the two minor children. I would add another Rs.5,000/- towards funeral expenses and loss to estate. The amout will aggregate to Rs.3,71,000/-. The Tribunal has awarded Rs.2,98,000/- and the amount in excess of what has FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -12- already been awarded, shall attract interest @6% from the date of the petition till the date of payment.

16. FAO No.5557 arises out of death of a householder aged 40 years and the claimant is the husband. While evidence was that she was contributing to the family worth Rs.4000/- per month, the Tribunal took her annual income to be Rs.15,000/- in the absence of any proof of income and made a 50% deduction on account of her personal consumption. The Tribunal adopted a multiplier of 16 and awarded a compensation of Rs.1,20,000/- and adding Rs.10,000/- for loss of consortium, loss to estate and funeral expenses aggregated the sum to Rs.1,30,000/-. The services of a householder cannot be underestimated as she plays a pivotal role in the welfare of the family. I would take the income of the deceased to be Rs.2500/- and make deduction at 50% as the claimant is only the husband. I would take the annual contribution to the family as Rs.15,000/-. I would retain the multiplier and conventional heads as adopted by the Tribunal and the amount that shall be payable would be Rs.2,50,000/-. The amount in excess of what has already been awarded by the Tribunal shall attract interest @6% from the date of the petition till the date of payment.

17. As regards the claim in FAO No.5562 of 2005, the deceased was Satpal, who was 35 years of age and the widow gave evidence to the effect that he was running a printing press and earning Rs.7,000/- per month. For a person who was literally the only bread winner, who was skilled, I will take the income to be Rs.3500/- per FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -13- month and would provide for a deduction of 1/3rd and take the monthly contribution to the family as Rs.28,000/-. For a person 35 years of age, I will adopt a multiplier of 16, which would mean an amount of Rs.4,48,000/-. I would provide for Rs.5,000/- for loss of consortium and Rs.5,000/- each for the son and daughter for love and affection and another Rs.5,000/- towards the conventional heads for loss to estate and funeral expenses. In all, the amount that will become payable would be Rs.4,68,000/-. The amount in excess of what has already been awarded by the Tribunal shall attract interest @6% from the date of the petition till the date of payment.

18. As regards the claim in FAO No.5563 of 2005, the deceased was a watch mechanic aged 28 years. The claimants were the wife, two minor children and one parents. I would take the monthly income to be Rs.3,000/- and provide for a 1/5th deduction for personal expenses. I would take the monthly contribution to the family to be Rs.2400/- and take the yearly dependence to be Rs.28,800/-. I would take the multiplier of 17 and take the extent of dependence to be Rs.4,89,600/-. For loss of love and affection to the children and loss of consortium to the wife respectively, I would provide a sum of Rs.15,000/- @ Rs.5000/- each and provide for a further sum of Rs.5000/- towards funeral expenses and loss to estate. The amount will aggregate to Rs.5,09,600/-. The amount in excess of what has already been awarded by the Tribunal shall attract interest @6% from the date of the petition till the date of FAO Nos.14-28 of 2006 and FAO Nos.5556-57, 5562-63 & 5570 of 2005 -14- payment.

19. I am not disturbing the awards relating to injuries and all of them shall stand confirmed. All the appeals of the insurance company are dismissed and the cross appeals for the claimants who are representatives of the deceased would stand enhanced in the manner referred to above. September 07, 2010 Pankaj* (K. KANNAN) JUDGE