Partly allowed

New India Assurance Co. Ltd. v. Som Nath & Ors.

Delhi HC12 Aug 2011MAC.APP./8/2011

Case brief

AI extract

What is this about?

The single judge dismissed the insurance company's appeal for lack of mandatory Section 170 permission. In the second appeal, the court enhanced compensation by modifying the multiplier to 17 (based on victim's age) and adding a 50% inflation benefit.

What did the court decide?

Insurance appeal dismissed for want of permission. Compensation enhanced by modifying multiplier to 17 and adding 50% for price rise.

New India Assurance Co. Ltd. Vs Som Nath & Ors. — Motor Accident Claims | Delhi HC (2011)

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* IN THE HIGH COURT OF DELHI AT NEW DELHI

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% Judgment reserved on : 10.08.2011 Judgment delivered on : 12.08.2011

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MAC APPEAL No.8/2011

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NEW INDIA ASSURANCE CO. LTD. ………..Appellant

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Through: Mr.K.L. Nandwani, Advocate

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Versus

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……….Respondents Through: Mr.Sanjeev Mehta, Advocate for the claimants. Mr. Harish Gupta, Advocate for respondent No. 4.

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SOM NATH & OTHERS

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MAC APPEAL No.83/2011

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SOM NATH SHARMA & ANOTHER ………..Appellants

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Through: Mr.Sanjeev Mehta, Advocate

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Versus

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NARESH KUMAR & OTHERS ……….Respondents Through: Mr.K.L. Nandwani, Advocate for the Insurance company

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CORAM: HON'BLE MS. JUSTICE INDERMEET KAUR

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Whether the Reporters of local papers may be allowed to see the judgment?

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To be referred to the Reporter or not? Yes

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Whether the judgment should be reported in the Digest? Yes

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MAC APPEAL Nos.8/2011 & 83/2011

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Page 1 of 6

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INDERMEET KAUR, J.

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1 These are two appeals which have arisen out of the Award dated 14.09.2010 wherein compensation in the sum of `3,57,000/along with interest @ 7.5% per annum had been awarded in favour of the claimants from the date of filing of the petition till realization.

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2 The first appeal i.e. MAC APPEAL No. 8/2011 has been filed by the Insurance Company. Admittedly permission under Section 170 of the Motor Vehicle Act (MVA) has not been taken by the Insurance Company before filing this appeal. The contention of the appellant/Insurance Company is that no such permission is required. The grounds of appeal as is evident from the body of the appeal is that vehicle in question i.e. Qualis was not involved in the accident; contention is that this has not been correctly appreciated by the Tribunal; the amount awarded is exorbitant; it is on the higher side; only a just and fair compensation was to be awarded; claimnts could not have been enriched; Award has accordingly been challenged on the aforenoted grounds. In the body of the appeal itself, it has been stated that permission under Section 170 of the MVA is not required.

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3 Learned counsel for the non-applicants/claimants submits MAC APPEAL Nos.8/2011 & 83/2011 Page 2 of 6

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that appeal of the appellant is not maintainable in view of mandatory permission which is required under Section 170 of the MVA.

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4 Under Section 170 of the MVA, the insurer has no right to file an appeal on grounds other than those available to it under Section 149 (2) of the MVA. Section 149(2) of the MVA is a provision engrafted to ensure that the victims of motor vehicle accidents are compensated and protected; Insurance Company cannot escape from its liability to pay compensation on any exclusionary clause in the insurance policy except those conditions which are specified under Section 149 (2) of the MVA; only those defences which are covered under Section 149 (2) are available to the insurer. In the instant case as is evident from the body of the appeal the claim of compensation has been challenged; this could not have been permissible unless permission under Section 170 of the MVA had been obtained. In the absence of this procedure having been followed, the appeal filed by the Insurance Company is not maintainable. This Court is fortified in this view in view of judgment delivered by another Bench of this Court in MAC APPEAL No. 560/20006 dated 28.03.2008 in the case of M/s National Insurance Co. Ltd. Vs. Mrs.

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Ashoka Devi and Others. The appeal of the Insurance Company is MAC APPEAL Nos.8/2011 & 83/2011 Page 3 of 6

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liable to be dismissed on this ground. It is accordingly dismissed. 5 The second appeal i.e. MAC APPEAL No. 83/2011 is an appeal filed by the claimants seeking enhancement of compensation. The compensation awarded as noted supra is in the sum of `3,57,000/- along with interest @ 7.5% per annum. The claimants are the parents of the victim Kunal @ Sonu. The deceased was coming on a motor cycle along with two persons when he was hit by Qualis No.DL-6CG-6601 which had been driven in rash and negligent manner; Qualis had fled away from the scene; one eye witness Bhagat Singh had been examined. It was not refuted that the Qualis was insured with the Insurance Company; contention of the Insurance Company was that this vehicle was not involved in the accident; however, since the appeal filed by the Insurance Company has been dismissed, this Court need not examine or deal with this argument.

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6 The claimants have assailed the compensation on the ground that the multiplier of 13 has been applied when as per the structured formula contained in the second Schedule of the MVA which is applicable to a claim petition under Section 163-A of the MVA, the multiplier of 17 should have been applied. This submission of learned counsel for the appellant is borne out. The

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MAC APPEAL Nos.8/2011 & 83/2011 Page 4 of 6

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victim was aged 23 years on the date of incident; age of victim was relevant to apply the multiplier in the case of a claim under Section 163-A of the MVA. The multiplier from 13 is accordingly modified to 17.

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7 The next contention of learned counsel for the appellant is that although the minimum wages of the victim had been taken into account at `3,300/- per month yet the benefit of price index rise and cost of inflation had not been taken into account. Reliance has been placed upon the judgments reported in 2008 ACJ 2182 (Delhi) Kanwar Devi Vs. Bansal Roadways, 2007 ACJ 2165 (Delhi) Lekhraj Vs. Suram Singh and 2009 ACJ 1921 (Delhi) National Insurance Co. Ltd. Vs. Renu Devi to substantiate the submission that 50% increase has to be considered as price rise and judicial notice of the fact should be taken into account that minimum wages are likely to be doubled in the next 10 years. This submission has been countered by learned counsel for the Insurance Company who states that price rise and cost of index inflation cannot be considered in a claim petition under Section 163-A of the MVA.

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8 To counter this submission learned counsel for the claimants

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has placed reliance upon a judgment of the coordinate Bench of this Court reported in 2009 (3) T.A.C. 120 (Del.) New India MAC APPEAL Nos.8/2011 & 83/2011 Page 5 of 6

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Assurance Co. Ltd. Vs. Mohd. Jabir & others where also future prospects were taken into account and the income of the deceased was doubled; this was also in a claim petition under Section 163-A of the MVA. The rider which has to be kept in mind is that the income calculated by the Tribunal should not exceed `40,000/- per annum which is a pre-requisite for the applicability of the provisions under Section 163-A of the MVA.

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9 Both these contentions of learned counsel for the claimants have force. The benefit of price rise index and cost of inflation has to be given to the victim. The compensation thus assessed would read as under:-

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Salary of the deceased 3,300/Adding future prospects (50%) <u>1,650/- 4,950/Deducting 1/3rd personal expenses <u>1,650/- 3,300/-X12X17 = 6,73,200/-

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10 The amount awarded under the head of funeral expenses, loss of estate and hospitalization & treatment expenses calls for no interference.

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11 Both the appeals are disposed of in the above terms.

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INDERMEET KAUR, J.

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AUGUST 12, 2011 a

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Page 6 of 6

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MAC APPEAL Nos.8/2011 & 83/2011

New India Assurance Co. Ltd. v. Som Nath & Ors.

Case brief

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What did the court decide?

New India Assurance Co. Ltd. v. Som Nath & Ors.

Case brief

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