# The New India Assurance Co. Ltd v. Lekhraj and others

- **Citation:** (2008) 3 ILRA 956
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2008-08-13
- **Case number:** First Appeal From Order No. 2448 of 2008
- **Bench:** Amitava Lala, A.P. Sahi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/the-new-india-assurance-co-ltd-v-lekhraj-and-others-41283
- **Pages:** 3

## Headnote

Motor Vehicle Act 1988-Section 163-A,
166-Difference
between
the
two
provisions explained-under section 166
No financial limit but under Section 163a maximum limit of 40,000/-prescribeddeceased getting salary Rs.12,242/- any
deduction towards instatement of home
loan-can not be excluded Court to
consider several factor to award just
compensation-No interference called for.

Held: Para 3

We are of the view that such judgement
is not supporting the cause of the
appellant
at
all.
The
ratio
of
the
judgement is that one has to choose as
to whether the application will be filed
under Section 163-A or under Section
166 of the Act, but both can not be
proceeded simultaneously. In case it is
under Section 163-A, limitation will be
there but in case of application under
Section
166
to
arrive
at
a
'just'
compensation, the Court has to consider
various factors and arrive at the same.
We are of the view that at the time of
arriving at such finding if the Court
considers various parts of the Schedule
as a guide, the Court is not said to be at
fault in adopting an appropriate process
3 All] The New India Assurance Co. Ltd. V. Lekhraj and others
957
for
the
purpose
of
arriving
at
compensation. The Court can not limit
itself in such circumstance as because
principle of structured formula under
Section 163-A has been applied. The
Court is compelled to arrive at 'just'
compensation. There is no question of
limit of compensation upto Rs.40,000/-
in
such
circumstance.
Submission
appears to be misconceived in nature.
Case law discussed:
2007 (2) AWC 2050

## Text

956 INDIAN LAW REPORTS ALLAHABAD SERIES [2008
petitioners have been in the service of the
Bank for the last 31, 27 and 23 year
respectively, and they have a clean record.
No inference can be drawn from this
circumstance, about the innocence, of the
petitioners.

10. It was also pointed out by the
learned counsel for the petitioners that the
financial status of the ladies was not such
as to enable them to collect jewellery of
around 20 lacs. It was further argued by
the counsel for the petitioners that no
description of the jewellery has been
given in the First Information Report.
These are matters of details to be
discovered during investigation and no
inference from them can be drawn, at this
stage, about the allegations being false. It
is disconcerting to note that, instead of
being helpful, the petitioners were hostile
and antagonistic.

11. The defalcation by the Bank
employees
should
be
deemed
unpardonable, since it undermines, the
confidence of the populace in financial
institutions. If they feel Banks are unsafe
where the people shall keep their money?
It will create confusion and disruption in
society, and any lenience, in such mattes
will be wholly misplaced.

12. Petition dismissed.
---------
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 13.08.2008

BEFORE
THE HON'BLE AMITAVA LALA, J.
THE HON'BLE A.P. SAHI, J.

First Appeal From Order No. 2448 of 2008

The New India Assurance Company Ltd.

...Appellant
Versus
Lekhraj and others
...Respondents

Counsel for the Appellant:
Sri Vinay Khare

Counsel for the Respondents:

Motor Vehicle Act 1988-Section 163-A,
166-Difference
between
the
two
provisions explained-under section 166
No financial limit but under Section 163a maximum limit of 40,000/-prescribeddeceased getting salary Rs.12,242/- any
deduction towards instatement of home
loan-can not be excluded Court to
consider several factor to award just
compensation-No interference called for.

Held: Para 3

We are of the view that such judgement
is not supporting the cause of the
appellant
at
all.
The
ratio
of
the
judgement is that one has to choose as
to whether the application will be filed
under Section 163-A or under Section
166 of the Act, but both can not be
proceeded simultaneously. In case it is
under Section 163-A, limitation will be
there but in case of application under
Section
166
to
arrive
at
a
'just'
compensation, the Court has to consider
various factors and arrive at the same.
We are of the view that at the time of
arriving at such finding if the Court
considers various parts of the Schedule
as a guide, the Court is not said to be at
fault in adopting an appropriate process
3 All] The New India Assurance Co. Ltd. V. Lekhraj and others
957
for
the
purpose
of
arriving
at
compensation. The Court can not limit
itself in such circumstance as because
principle of structured formula under
Section 163-A has been applied. The
Court is compelled to arrive at 'just'
compensation. There is no question of
limit of compensation upto Rs.40,000/-
in
such
circumstance.
Submission
appears to be misconceived in nature.
Case law discussed:
2007 (2) AWC 2050

(Delivered by Hon'ble Amitava Lala, J.)

1. The appellant-insurance company
has challenged the judgement and order
dated 26th April, 2008 passed by the
concerned
Motor
Accidents
Claims
Tribunal, Gautam Budh Nagar. It has
been contended by the learned Counsel
appearing for the appellant that the claim
petition was filed after a period of six
months and no number of the vehicle was
known at the time of accident when the
first information report was lodged
immediately on the next date of the
accident.
However,
the
police
investigation was made, the vehicle was
found out and the charge-sheet has been
filed against the driver before the
appropriate
criminal
Court
of
the
competent jurisdiction. Therefore, we can
not accept any ground with regard to noninvolvement of the vehicle.

2. So far as income of the deceased
is concerned, the tribunal held that as per
the salary certificate the deceased was
getting monthly salary of Rs.12,213/- but
after deducting loan instalment he was
taking home a sum of Rs.7,812/- , which
the tribunal ultimately rounded up to
Rs.7,800/- as per month salary and upon
giving deduction even thereafter arrived
at the compensation of Rs.9,66,000/-.
Firstly, the insurance company contended
that the income was Rs.7,812/- as held by
the tribunal. According to us, it is
misreading
of
the
learned
Counsel
appearing for the insurance company
because the salary is Rs.12,213/- pre
month as per the certificate. Any
deduction on account of loan is also part
of the salary. Therefore, the tribunal itself
came to a finding that the salary will be
considered as Rs.7,800/- and upon giving
deduction awarded the compensation,
which should be held on the lower side
but not on the higher side. The insurancecompany further contended before this
Court that when the tribunal has followed
the Second Schedule under Section 163-A
of
the
Motor
Vehicles
Act,
1988
(hereinafter called as the 'Act'), the
quantum of income should be within the
highest limit of such schedule i.e.
Rs.40,000/- per annum not beyond that,
and in support of his contention learned
Counsel appearing for the appellant relied
upon a Division Bench judgement of this
Court reported in 2007 (2) AWC 2050
(Smt. Manjula Devi Mishra and others
Vs. Commercial Motors, Kanpur and
others). The relevant portion of such
judgement is as follows:

"... Besides, we would like to make it
further clear that in view of decision
rendered by Hon'ble Apex Court in U.P.
State Road Transport Corporation v.
Trilok Chandra, (1996) 4 SCC 362,
wherein Hon'ble Apex Court has held that
the multiplier and structural formula
provided under Second Schedule of the
Act
can
be
used
as
guide
for
determination of compensation to be
awarded to the claimants but in Deepal
Girish Bhai Soni and others v. United
India Insurance Co. Ltd., Baroda, AIR
2004 SC 2107: 2004 (3) AWC 2011 (SC)
Hon'ble Apex Court has categorically
958 INDIAN LAW REPORTS ALLAHABAD SERIES [2008
held that the claim petition under Section
163A can be maintainable only in respect
of the victims of motor accident having
annual income maximum upto Rs.40,000.
Therefore, in our opinion, in cases where
the allegations are made that the income
of the victim is more than Rs.40,000 per
annum it is not open for the Tribunal to
entertain the claim petition under Section
163A of the Act, such claim petition can
be maintainable under Section 166 of the
Motor Vehicles Act, thus, it is not open for
the Motor Accident Claims Tribunal to
take advantage of Second Schedule of the
Motor Vehicles Act and multiplier used
therein where the income of victims of
motor accident is more than Rs. 40,000
per annum. The multiplier in respect of
age of victims of motor accident has corelation with the income of the victims in
the Second Schedule. Therefore it is not
open for the Claim Tribunals to determine
the annual income of the victim of motor
accident over and above Rs.40,000 and
then apply the multiplier on the basis of
age alone as provided in the Second
Schedule of the Act."

3. We are of the view that such
judgement is not supporting the cause of
the appellant at all. The ratio of the
judgement is that one has to choose as to
whether the application will be filed under
Section 163-A or under Section 166 of the
Act, but both can not be proceeded
simultaneously. In case it is under Section
163-A, limitation will be there but in case
of application under Section 166 to arrive
at a 'just' compensation, the Court has to
consider various factors and arrive at the
same. We are of the view that at the time
of arriving at such finding if the Court
considers various parts of the Schedule as
a guide, the Court is not said to be at fault
in adopting an appropriate process for the
purpose of arriving at compensation. The
Court can not limit itself in such
circumstance as because principle of
structured formula under Section 163-A
has been applied. The Court is compelled
to arrive at 'just' compensation. There is
no question of limit of compensation upto
Rs.40,000/-
in
such
circumstance.
Submission appears to be misconceived in
nature.

4. Therefore, in totality we do not
find any ground for the purpose of
admitting the appeal. Hence, the appeal is
dismissed at the stage of admission,
however, without imposing any cost.

5. Incidentally, the appellantInsurance Company prayed that the
statutory deposit of Rs.25,000/- made
before this Court for preferring this appeal
be remitted back to the concerned Motor
Accidents
Claims
Tribunal
as
expeditiously as possible in order to
adjust the same with the amount of
compensation to be paid to the claimant,
however, such prayer is allowed. Appeal
dismissed.
---------
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 08.09.2008

BEFORE
THE HON'BLE V.M. SAHAI, J.
THE HON'BLE PANKAJ MITHAL, J.

Special Appeal No. 1142 of 2008

Smt. Neelu Devi ...Appellant/Petitioner
Versus
State of U.P. and others ...Respondents

Counsel for the Appellant:
Sri Indrasen Singh Tomar
Sri Man Bahadur Singh