Partly allowed

National Insurance Co.Ltd v. Snehal Yeshwant Dhande and Ors.

Bombay HC12 Feb 2013FA/2007/2010

Case brief

AI extract

What is this about?

In a first appeal, the High Court considered the appellant's challenge to the quantum of interest awarded under the Motor Vehicles Act. The Court allowed the appeal insofar as it pertained to penal interest, quashing the award of 15% per annum in favor of simple interest, while confirming the rest of the Tribunal's award.

What did the court decide?

The impugned order regarding 15% interest in default was quashed and set aside; the rest of the award was confirmed.

National Insurance Co.Ltd Vs Snehal Yeshwant Dhande and… — Motor Accident Claims | Bombay HC (2013)

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1 FA 2007.2010

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD

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FIRST APPEAL NO. 2007 OF 2010

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National Insurance Company Ltd., having Head and Registered Office at 3, Middleton Street, Calcutta ( West Bengal) (through National Insurance Co. Ltd. Pipri Branch, P.O. Tura, Dist. Sonbhadra (U.P.) 231 221. (The proceedings of this appeal are being looked after and supervised by the National Insurance Co. Ltd. Divisional Office, Hajari Chambers, Station road, Aurangabad 431 005. .. Petitioner

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Versus

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1] Smt. Snehal w/o Yeshwant Dhande, Age 22 years, Occu. Household,

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2] Ku. Tajas Yeshwant Dhande, Age 2 years, Occu. Nil, Minor, through his minor guardian mother- petitioner No. 1

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3] Sau. Laxmibai @ Chamelibai w/o Harchand Dhande, Age 56 years, Occu. Household,

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4] Shri Harchand Motiram Dhande, Age 65 years, Occu. Nil

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2 FA 2007.2010

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Respondent Nos. 1 to 4 all R/o : Sangavi BK. , Tq. Yawal, District Jalgaon.

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5] Shri Jarendrakumar Jankhushahaldas, Age 32 years, Occu. Truck driver, R/o : churkbajar, O-35/60 Renukot, Tqluka Khadasganj, District Sonbhadra (U.P.) [deleted in lower Court]

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6] Shri Prakash Bhagmal Sharma, Age Major, Occu. Truck owner, (Business), R/o C/o T.T.O. Murdhava, “Renukot”, Taluka Khadasganj, District Sonbhadra (U.P.) (deleted as per Courts order dated 14/09/2012) .. Respondents

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Shri P.F. Bafna, Advocate for appellant Shri Pravin P. Chavan, Advocate. for respondent Nos. 1 to 3

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CORAM : S. V. GANGAPURWALA, J. DATE : 12th FEBRUARY, 2013.

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ORAL JUDGMENT :

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Heard. Admit. With the consent of parties taken up for final hearing.

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3 FA 2007.2010

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The appellant has restricted his prayer to the extent of rate of interest awarded. Shri P.F. Bafna, learned counsel for the appellant, submits that the Tribunal has awarded interest @ 12% per annum which is exorbitant, at the most the claimants could have awarded interest @ 7.5% per annum. Learned counsel submits that even the provisions of Motor Vehicles Act, do not admit grant of penal interest. The Tribunal has awarded penal interest also. The said order is also illegal and not countenanced by law.

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Shri Chavan, learned counsel for respondents / claimants submits that the appellant has nowhere raised the ground that interest is awarded at an exorbitant rate in the appeal, as such the appellant cannot be allowed to raise this argument.

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Learned counsel further submits that even no permission under Section 170 of the Motor Vehicles Act has been granted. As such appeal would be incompetent and appeal cannot be entertained. The Tribunal has rightly granted the interest.

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In the appeal, the appellant had challenged the quantum of

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4 FA 2007.2010

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the compensation on the ground of the wrong applicability of multiplier by the Tribunal. As per Sarla Varma’s case, the multiplier applied is correct and proper, and no interference is required on the said aspect.

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As far as grant of permission under Section 170 of the Motor Vehicles Act is concerned, the appellant has filed in this Court affidavit, stating that the application was filed seeking permission to cross-examine the witness and defend the matter, and the said application was allowed. It is marked as Exhibit 21A. It appears that before the deposition, the claimants filed pursis stating that they are closing their evidence. Be that as it may, the Apex Court in case of United India Insurance Co. Ltd. V. Shaila Datta & Ors, AIR 2012, Supreme Court 86, has held that when the Insurance Company is made a party, the insurance Company has right to raise all defenses available to it.

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The interest as per Section 171 of the Motor Vehicles Act can be awarded as per the simple rate only. Section 171 of the Motor Vehicles Act only enables the Tribunal to grant simple interest. To grant interest @ of 15% per annum in case of default is penal in nature.

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5 FA 2007.2010

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As far as the interest @ 12% per annum granted is on the higher side, the said contention cannot be considered, in absence of any material on record. In the appeal also there is no material placed on record to show that at the relevant time the bank rate was less than the same.

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9. In view of the above, I pass following order :

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The impugned order passed by the Tribunal to the extent of interest @ 15% per annum in default of making payment of the amount awarded within one month from the date of award is quashed and set aside. Rest of the award is confirmed.

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. Appeal is accordingly disposed of.

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[ S. V. GANGAPURWALA, J. ]

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SDM*/FEB.13

National Insurance Co.Ltd v. Snehal Yeshwant Dhande and Ors.

Case brief

What is this about?

What did the court decide?

National Insurance Co.Ltd v. Snehal Yeshwant Dhande and Ors.

Case brief

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What did the court decide?

What the court decided

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