# Smt. Sushma Devi & Anr v. The National Insurance Company & Ors

- **Citation:** (2023) 8 ILRA 200
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2023-07-10
- **Case number:** First Appeal From Order No. 1287 of 1998
- **Bench:** Dr. Kaushal Jayendra Thaker
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/smt-sushma-devi-anr-v-the-national-insurance-company-ors-50584
- **Pages:** 6

## Headnote

A. Civil Law-Motor Vehicles Act,1988Section
173-Challenge
to-award
of
compensation-The deceased being trained
Junior Engineer, his income in the year of
accident can be considered to be Rs.
1500/- per month to which 40% should
be added towards future loss of incomeThe deduction towards personal expenses
of the deceased would be 1/3rd as the
deceased was survived by widow and one
other legal heir-The deceased being 25
years of age, the multiplier applicable
would be 18-As far as amount under the
head of non pecuniary damages are
concerned, Rs.70,000/- is granted- Thus,
the total compensation of Rs.3,72,400/- is
granted-The Tribunal has awarded 12%
rate of interest which is reduced to 9%
per annum. The additional amount would
carry interest at the rate of 9% from the
date of filing of the claim petition till the
date of award and 6% thereafter.(Para
1to 24)

B. It is a cardinal principle that if it is a
question of composite negligence then
only both owner and drivers of both the
vehicle would be liable. In our case, the
finding is very clear that the driver of the
bus was solely negligent and there is no
negligence on the part of the driver of
motorcycle. Once it is held that the driver
of the motorcycle is not negligent, the
insurer of motorcycle cannot be held
liable. (Para 13)
The appeal is partly allowed. (E-6)

List of Cases cited:

## Text

200 INDIAN LAW REPORTS ALLAHABAD SERIES
The only dispute is regarding percentage of
disability and the interest. No other grounds
are raised except these two grounds.

4. According to counsel for appellant
the Tribunal has fallen in error in
considering the disability certificate which
showed that there was 50% of disability
despite that the Tribunal has considered the
disability of the injured to be 100% which
is bad in eye of law.

5. While going through the record it is
very clear that the claimant was a driver by
profession. There is an amputation of
lower limb which is below the thigh.It is
a question of fact that the physical
disability caused due to an accident has to
be judged with reference to the nature of
work being done by the injured for
assessing award of compensation which
is given in a decade old judgment of
Apex Court in Mohan Soni Vs. Ram
Avtar Tomar and others ( 2012) 2 SCC
267. In our case the physical disability
which has resulted from the accident
requires to be judged with the work being
performed by a person. The respondent in
this case suffered injury on his right
lower limb had to be amputated on
account of accident as a result of accident
and amputation of his right lower limb,
he would not be in a position to perform
his routine work of driver.

6. The amount awarded holds that he
was earning Rs.1,000/- and that is how
Rs.12000/- have been calculated and
granted multiplier of 13 which comes to
Rs.2,00,000/- have been awarded. This
Court has considered the oral submission
on behalf of appellant. The amount
awarded cannot be said to be on the higher
side.

7. In that view of the matter the
injured would not be in a position to
continue with his vocation of driver, this
finding cannot be said to be perverse.

8. The multiplier of 13 has been
invoked. The Tribunal has not granted any
amount under the head of future loss of
income and, therefore, it cannot be said that
the Tribunal has fallen in error in not
granting what can be said to be just
compensation.

9. The award of the year 1998 and the
rate of interest was normally at the rate of
9% but as future loss is not granted,
looking to the other amount which are also
on the lower side, interest at the rate of
10% cannot be said on higher side.

10. In view of the above, this appeal
sans merit and is dismissed.

11. Record and proceeding be sent
back to the Tribunal forthwith who shall
immediately disburse the amount to the
claimants after ascertaining his identity.
----------
(2023) 8 ILRA 200
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 10.07.2023

BEFORE

THE HON'BLE DR. KAUSHAL JAYENDRA
THAKER, J.

First Appeal From Order No. 1287 of 1998
And
First Appeal From Order No. 1178 of 1998

Smt. Sushma Devi & Anr. ...Appellants
Versus
The National Insurance Company & Ors.
 ...Respondents
8 All. Smt. Sushma Devi & Anr. Vs. The New Insurance Company & Ors.
201
Counsel for the Appellants:
Sri Rakesh Kumar Porwal

Counsel for the Respondents:
Sri Anand Kumar Sinha

A. Civil Law-Motor Vehicles Act,1988Section
173-Challenge
to-award
of
compensation-The deceased being trained
Junior Engineer, his income in the year of
accident can be considered to be Rs.
1500/- per month to which 40% should
be added towards future loss of incomeThe deduction towards personal expenses
of the deceased would be 1/3rd as the
deceased was survived by widow and one
other legal heir-The deceased being 25
years of age, the multiplier applicable
would be 18-As far as amount under the
head of non pecuniary damages are
concerned, Rs.70,000/- is granted- Thus,
the total compensation of Rs.3,72,400/- is
granted-The Tribunal has awarded 12%
rate of interest which is reduced to 9%
per annum. The additional amount would
carry interest at the rate of 9% from the
date of filing of the claim petition till the
date of award and 6% thereafter.(Para
1to 24)

B. It is a cardinal principle that if it is a
question of composite negligence then
only both owner and drivers of both the
vehicle would be liable. In our case, the
finding is very clear that the driver of the
bus was solely negligent and there is no
negligence on the part of the driver of
motorcycle. Once it is held that the driver
of the motorcycle is not negligent, the
insurer of motorcycle cannot be held
liable. (Para 13)
The appeal is partly allowed. (E-6)

List of Cases cited:

1. Gobald Motor Services Ltd. & anr. Vs R.M.K.
Velusamy (1962) SCR 1 929

2. New India Assr. Co. Ltd. Vs Bismillah Bai
(2009) 5 SCC 112
3. Samundra Devi Vs Narendra Kaur (2008) 9
SCC 100

4. Oriental Ins. Co. Ltd. Vs Sudhakaran K.V.
(2008) 7 SCC 428

5. A.V. Padma Vs Venugopal (2012) 1 GLH SC
442

6. Smt. Hansaguri P. Ladhani Vs The Oriental
Ins. Co. Ltd (2007) 2 GLH 291

7. Smt. Sudesna & ors. Vs Hari Singh & anr.
FAFO No. 23 of 2001

8. Bajaj Allianz Gen. Ins. Co. Pvt. Ltd. Vs UOI &
ors.

(Delivered by Hon'ble Dr. Kaushal
Jayendra Thaker, J.)

1. Heard Sri Rakesh Kumar Porwal,
learned counsel for the appellant, Sri
Anand Kumar Sinha, learned counsel for
the respondent-Insurance Company and
perused the judgment and order impugned.

2. Both these appeals challenges the
judgment and award dated 31.8.1998
passed
by
Motor
Accident
Claim
Tribunal/VII Additional District Judge,
Etawah in M.A.C. No. 353 of 1994
(Sushma Devi and another vs. Om Prakash
Gupta and others) & 354 of 1994
(Rameshwari Devi and others vs.Om
Prakash Gupta and others).

3. F.A.F.O. No.1287 of 1998 has been
filed against the Claim Petition No. 353 of
1998 whereby the Tribunal has awarded
compensation of Rs. 1,35,000/- to the
respondent-claimants with interest at the
rate of 12%. F.A.F.O. No. 1178 of 1998
has been filed against claim petition No.
354 of 1993 which was dismissed in
terms of amount awarded under no fault
liability.
202 INDIAN LAW REPORTS ALLAHABAD SERIES

4. A very fanciful argument in the
rejoinder has been raised by Sri R.K.
Porwal which is only raised for being
rejected outright. The claim petition was
under Section 140 & 166 of Motor Vehicles
Act. It is submitted by Sri Porwal that the
claim petition should be considered under
Section 163A of Motor Vehicles Act by this
Court and the liability should be fasten on
the National Insurance Co. Ltd. namely the
insurer of the motorcycle on which the
deceased were travelling though the driver
of motorcycle is held to have not
contributed to accident having taken place.

5. This fanciful argument is made
because by learned counsel for the
appellant Sri Sinha, learned counsel for
Insurance
Company
supported
the
judgment of the Tribunal. The Tribunal has
held that the driver of bus was negligent
and granted recovery right from the owner
and driver of the bus as the vehicle seems
to be uninsured or rather the owner and
driver did not give the details of Insurance
policy of bus.

6. This takes this Court to the aspect
of compensation as that is the sole aspect
which requires to be considered. It was
contended by Sri Porwal that the Tribunal
dismissed the claim petition being Claim
Petition No. 354 of 1993 preferred by
widow of one of the deceased. The Tribunal
with due respect to Sri Porwal had not
dismissed the claim petition rather it has
over zealously granted amount of no fault
liability to the widow of the deceased who
as per the postmortem report was 75 years
of age. The submission of Sri Sinha,
learned counsel for Insurance Company is
that the amount under no fault liability
which has already been paid is rightly paid
as just compensation. Sri Sinha has
submitted that impugned order cannot be
found fault with as the deceased was above
70 years, the Tribunal considered his
income to be Rs.10,000/- per annum and
applied multiplier of 5. It is submitted that
for no fault liability, the
Insurance
Company has already deposited the amount
in claim petition filed under Section 140 of
Motor Vehicles Act, 1988.

7. However, Rs.20,000/- under the
head of non pecuniary damage to widowRameshwari Devi would be payable with
interest as directed herein below. The
claimant being non tortfeasor can collect
the amount from any of the tortfeasors.

8. This takes this Court to First
Appeal From Order No. 1287 of 1998
preferred against Claim Petition No. 353 of
1993. A young man of 25 years breathed
his last when he was a trained Junior
Engineer. The Tribunal has considered his
income to be Rs. 15,000/- per year and
granted multiplier of 18 after considering
that Rs. 750/- would be the datum figure.
The Tribunal has granted only Rs. 7000/-
towards non pecuniary damages and has
not granted any amount under future loss of
income is the submission of learned
counsel for the appellants and are the facts
emerged from impugned judgment.

9. The amount requires to be
recalculated as even in the year of accident
i.e. 1993, the decision of the Apex Court in
Gobald Motor Services Ltd. and another
v. R.M.K. Velusamy, 1962 SCR (1) 929
was very much there and future prospects
were granted. In this case, future prospects
had to be granted to a junior engineer who
has lost his life leaving behind his widow
and children.

10. The deceased being trained Junior
Engineer, his income in the year of accident
8 All. Smt. Sushma Devi & Anr. Vs. The New Insurance Company & Ors.
203
can be considered to be Rs. 1500/- per month
to which 40% should be added towards future
loss of income. The deduction towards
personal expenses of the deceased would be
1/3rd as the deceased was survived by widow
and one other legal heir. The deceased being
25 years of age, the multiplier applicable
would be 18. As far as amount under the head
of non pecuniary damages are concerned,
Rs.70,000/- is granted.

11. Hence, the total compensation
payable to the appellants is computed
herein below:

i. Income: Rs.1500/-per month
namely Rs. 18000/- per year.

ii. Percentage towards future
prospects : 40% namely Rs.7200/-

iii. Total income : Rs.18000 +
7200 = Rs.25,200/-

iv. Income after deduction of
1/3rd
towards
personal
expenses
:
Rs.16,800/-

v. Multiplier applicable : 18

vi.
Loss
of
dependency:
Rs.16,800 x 18 = Rs.3,02,400/-

vii. Amount under non pecuniary
heads : Rs.70,000/-

viii.
Total
compensation
:
Rs.3,72,400/-

12. As far as issue of interest is
concerned, the Tribunal has awarded 12%
rate of interest whi ch is reduced to 9% per
annum. The additional amount would carry
interest at the rate of 9% from the date of
filing of the claim petition till the date of
award and 6% thereafter till the amount is
deposited.

Liability

13. It is a cardinal principle that if it is
a question of composite negligence then
only both owner and drivers of both the
vehicle would be liable. In our case, the
finding is very clear that the driver of the
bus was solely negligent and there is no
negligence on the part of the driver of
motorcycle. Once it is held that the driver
of the motorcycle is not negligent, the
insurer of motorcycle cannot be held liable.

14. As per the ratio laid down in the
case of "New India Assurance Co. Ltd.
v/s. Bismillah Bai, (2009) 5 SCC 112",
liability of Insurance Company insuring
vehicle
not
responsible
for
or
not
contributing to accident. In the said case, a
Jeep colliding with a truck. Truck involved
in accident not insured. Tribunal recording
that driver of Jeep not negligent in driving
Jeep and not contributing to accident. High
Court fastening liability on insurer of Jeep.
Unsustainability. Held. only because truck
was not insured, appellant could not be
made liable to pay compensation where
liability being incurred by driver and owner
of truck and not by driver and owner of
Jeep".

15. As per the ratio laid down in case
of "Samundra Devi v/s. Narendra Kaur,
(2008) 9 SCC 100", a contract of insurance
as is well known is a contract of indemnify.
In a case of accident, the primary liability
under law for payment of compensation is
that of the driver. The owner of the vehicle
also becomes vicariously liable therefor. In
a case involving a third party to the
contract of insurance in terms of Section147 of Motor Vehicle Act, 1988, providing
for a compulsory insurance, the insurer
becomes statutorily liable to indemnify the
owner. Indisputably, the insurance company
would be liable to indemnify the insured in
respect of loss suffered by a third party or
in respect of damages or property. In a case,
therefore, where the liability is fastened
204 INDIAN LAW REPORTS ALLAHABAD SERIES
upon the insurer would be bound to
indemnify the insured unless the exceptions
contained in Section-149 of the Act are
attached. (Para-15). In certain situation
when the Insurance Company would not be
liable to reimburse the insured, a direction
upon the Insurance Company to pay the
amount of compensation to the third party
and recover the same from the owner of the
vehicle is permissible. Such a direction was
not under challenge. (para-16).

16. As per the ratio laid down in case
of "Oriental Insurance Co. Ltd. v/s.
Sudhakaran K.V. (2008) 7 SCC 428", a
distinction has to be made between a
contract of insurance in regard to a third
party and the owner or the driver of the
vehicle. In term of Section-147 of the Act a
contract of insurance must be taken by the
owners of the vehicle only in regard to
reimbursement of the claim to a third party.
Section-147 is imperative in nature. When,
however, an owner of a vehicle intends to
cover himself from other risks, it is
permissible to enter in to a contract of
insurance in which event the insurer would
be bound to reimburse the owner of the
vehicle strictly in terms thereof. The
liability of the insurer to reimburse the
owner in respect of a claim made by the
third party, thus, is statutory whereas other
claims are not. (para-16, 13 & 14). The
provisions of the Act and in particular,
Section-147 of the Act were enacted for the
purpose of enforcing the principles of
social justice. It, however, must be kept
confined to a third party risk. A contract of
insurance which is not statutory in nature
should be construed like any other contract.

17. In view of the above, it is clear
that no further order can be passed so as to
saddle the Insurance Company of the
motorcycle with any liability. The liability
has to be saddled on the owner and driver
of the bus. It was not brought on record
before the Tribunal nor before this Court
whether bus was insured or not. Be that as
it may, the said finding that the Insurance
Company of motorcycle would pay cannot
be furthered for the remaining amount as
there is clear finding that the driver of the
bus was solely negligent. The driver and
owner of the bus have absented themselves
for a period of 25 years since filing of this
appeal.

18. However, being already deposited
the amount under no fault liability, the insurer
of motorcycle may not be directed to deposit
any amount. The amount should be recovered
from the driver and owner of the bus who
have absented themselves and have not
appeared before this Court for 23 years.

19. In view of the above, both the
appeals are partly allowed. Judgment and
decree passed by the Tribunal shall stand
modified to the aforesaid extent. The
respondent shall deposit the amount within a
period of 12 weeks from today with interest
as directed above. The amount already
deposited be deducted from the amount to be
deposited. Record and proceedings be sent
back to the Tribunal forthwith.

20. On depositing the amount in the
Registry of Tribunal, Registry is directed to
first deduct the amount of deficit court fees,
if any. Considering the ratio laid down by
the Hon'ble Apex Court in the case of A.V.
Padma V/s. Venugopal, Reported in 2012
(1) GLH (SC), 442, the order of
investment is not passed because applicants
/claimants are neither illiterate or rustic
villagers.

21. In view of the ratio laid down by
Hon'ble Gujarat High Court, in the case of
8 All. Ashish Kuar Yadav Vs. Aatma Nand Singh & Anr.
205
Smt. Hansaguri P. Ladhani v/s The
Oriental
Insurance
Company
Ltd.,
reported in 2007(2) GLH 291, total
amount of interest, accrued on the principal
amount
of
compensation
is
to
be
apportioned on financial year to financial
year basis and if the interest payable to
claimant for any financial year exceeds
Rs.50,000/-,
insurance
company/owner
is/are entitled to deduct appropriate amount
under the head of 'Tax Deducted at Source'
as provided u/s 194A (3) (ix) of the Income
Tax Act, 1961 and if the amount of interest
does not exceeds Rs.50,000/- in any
financial year, registry of this Tribunal is
directed to allow the claimant to withdraw
the
amount
without
producing
the
certificate from the concerned Income- Tax
Authority. The aforesaid view has been
reiterated by this High Court in Review
Application No.1 of 2020 in First Appeal
From Order No.23 of 2001 (Smt. Sudesna
and others Vs. Hari Singh and another)
while disbursing the amount.

22.

Fresh
Award
be
drawn
accordingly in the above petition by the
tribunal as per the modification made
herein. The Tribunals in the State shall
follow the direction of this Court as herein
aforementioned as far as disbursement is
concerned, it should look into the condition
of the litigant and the pendency of the
matter and judgment of A.V. Padma
(supra). The same is to be applied looking
to the facts of each case.

23. The Tribunal shall follow the
guidelines issued by the Apex Court in
Bajaj
Allianz
General
Insurance
Company Private Ltd. v. Union of India
and others vide order dated 27.1.2022, as
the purpose of keeping compensation is to
safeguard the interest of the claimants. As
long period has elapsed, the amount be
deposited in the Saving Account of
claimants in Nationalized Bank without
F.D.R.

24. This Court is thankful to both the
counsels for getting this matter decided.
----------
(2023) 8 ILRA 205
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 21.03.2023

BEFORE

THE HON'BLE J.J. MUNIR, J.

First Appeal From Order No. 3826 of 2009

Ashish Kuar Yadav ...Appellant
Versus
Aatma Nand Singh & Anr. ...Respondents

Counsel for the Appellant:
Sri Ram Singh, Sri Amit Kumar Sinha

Counsel for the Respondents:
Sri Amit Manohar

A. Civil Law-Motor Vehicle Act, 1988Section
173-enhancement
of
compensation- At the time of the accident,
the claimant was a young man of 22 years
and a student. In consequence of the
injuries, the claimant turned from an ablebodied man to a permanently handicapped
- During treatment, the claimant's right
lower limb had to be amputated above the
knee, leading him to develop a permanent
handicap, which was assessed by the
Chief Medical Officer as 50% permanent
disability-the claimant has earned his high
school and intermediate certificate in the
second division and was reading as a
private candidate to earn his bachelor's
degree-
The
Tribunal
awarded
Rs.
9,52,000/- the injured falls in the bracket
of 21-25 years, wherefor, a multiplier of
'18' is envisaged- The Tribunal has fallen
in error in adopting the multiplier of 17-
Adding 40% for the future prospects, it