Partly allowed

Smt Nagamani v. Mr D Sreenivasalu Reddy

Karnataka HC18 Sept 2024MFA/9582/2018

Case brief

AI extract

What is this about?

Claimants sought enhancement of compensation for the death of a pedestrian in a lorry accident. The court enhanced compensation to Rs.16,73,200/- using KSLSA notional income with future prospects, awarded consortium amounts, held the insurer liable despite no valid permit with recovery rights from the owner, and fixed interest at 6% p.a.

What did the court decide?

Compensation enhanced to Rs.16,73,200/- with 6% p.a.; insurer directed to pay and deposit within six weeks, recoverable from vehicle owner.

Smt Nagamani Vs Mr D Sreenivasalu Reddy — Insurance | Karnataka HC (2024)

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1 - NC: 2024:KHC:38313 MFA No. 9582 of 2018

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

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DATED THIS THE 18^TH DAY OF SEPTEMBER, 2024

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BEFORE

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THE HON'BLE MR JUSTICE H.T. NARENDRA PRASAD MISCELLANEOUS FIRST APPEAL NO. 9582 OF 2018 (MV)

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BETWEEN:

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SMT NAGAMANI W/O LATE M NAGESH AGED ABOUT 31 YEARS

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KUMARI SWAPNA N D/O LATE M NAGESH AGED ABOUT 14 YEARS

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KUMARI SWATHI D/O LATE M NAGESH AGED ABOUT 12 YEARS

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Digitally signed by HEMALATHA A Location: HIGH COURT OF KARNATAKA

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APPELLANT Nos. 2 & 3 ARE MINORS REPR HER MOTHER NATURAL GUARDIAN APPELLANT NO.1 NAGAMANI ALL ARE RESIDING AT VEERANDAHALLI VILLAGE GOWRIBIDANUR TOWN CHIKKABALLAPUR DISTRICT -561208

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…APPELLANTS

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(BY SRI. HARISH BABU K N.,ADVOCATE)

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AND:

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MR D SREENIVASALU REDDY S/O D VENKATA REDDY H.NO.19-4-377-1A-1 ARVETI NAGAR, GOOTY ROAD ANANTHAPUR ANDHRA PRADESH-51500.

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THE REGIONAL MANAGER NATIONAL INSURANCE COMPANY LTD REGIONAL OFFICE

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NC: 2024:KHC:38313 MFA No. 9582 of 2018

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NO.144, 2ND FLOOR SUBHARAM COMPLEX M G ROAD, BANGALORE-560 001

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…RESPONDENTS

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(BY SRI.ASHOK N PATIL .,ADVOCATE FOR R2: NOTICE TO R1 IS DISPENSED WITH V/O DATED: 18.09.2024)

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THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD DATED:31.07.2018 PASSED IN MVC NO.3925/2016 ON THE FILE OF THE VII ADDITIONAL SMALL CAUSES JUDGE AND XXXII ACMM, MEMBER, MACT-3, COURT OF SMALL CAUSES, BENGALURU (SCCH-3), PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION.

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THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

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CORAM: HON'BLE MR JUSTICE H.T. NARENDRA PRASAD

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ORAL JUDGMENT

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This appeal under Section 173(1) of the Motor Vehicles Act, 1988 (hereinafter referred to as ‘the Act’, for short) has been filed by the claimants challenging the judgment and award dated 31.07.2018 passed by the MACT, Bengaluru in MVC 3925/2016.

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3 - NC: 2024:KHC:38313 MFA No. 9582 of 2018

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Facts giving rise to the filing of the appeal briefly stated are that on 16.08.2014, when the deceased M.Nagesh was a pedestrian walking on the left side of the road from Karekallahalli side to his house, Idaguru road, at that time, a lorry bearing registration No.AP-09-Y-4325 which was being driven in a rash and negligent manner, dashed against the deceased. As a result of the aforesaid accident, the deceased sustained grievous injuries and succumbed to the injuries.

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The claimants filed a petition under Section 166 of the Act seeking compensation for the death of the deceased along with interest.

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Upon service of notice, the respondent No.2 appeared through counsel and filed written statement denying the averments made in the claim petition. The respondent No.1, despite service of notice, did not appear before the Tribunal and was placed ex-parte.

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4 - NC: 2024:KHC:38313 MFA No. 9582 of 2018

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On the basis of the pleadings of the parties, the Claims Tribunal framed the issues and thereafter, recorded the evidence. The Tribunal, by impugned judgment and award has partly allowed the claim petition and held that the claimants are entitled to a compensation of Rs.12,34,800/- along with interest at the rate of 8% p.a. and directed the owner of the offending vehicle to deposit the compensation amount along with interest. Being aggrieved, this appeal has been filed.

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The learned counsel for the claimants has raised the following contentions:

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Liability:

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After considering the materials available on record, the Tribunal has rightly held that as on the date of accident, the offending vehicle was not having valid permit to ply the vehicle in the State of Karnataka. Hence, the Tribunal has rightly exonerated the Insurance Company from liability. But, however, since third party claim is

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involved, the Insurance Company has to pay

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compensation to the claimant and later recover the same from the owner of the offending vehicle. In support of his contention, he has relied upon the decision the Apex Court in the case of RANI –V- NATIONAL INSURANCE COMPANY

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LTD. (2018) 8 SCC 492.

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Quantum of compensation

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a) Firstly, the claimants assert that the deceased was aged about 33 years at the time of the accident and had a monthly income of Rs.15,000/- by doing Bar Bending work. However, the assessment of monthly income of the deceased at Rs.6,500/- by the Tribunal is unjustified and erroneous.

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b) Secondly, as per the law laid down by the Hon’ble Supreme Court in the case of NATIONAL INSURANCE

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CO. LTD. -v- PRANAY SETHI AND OTHERS [AIR 2017

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SC 5157], in cases, where the deceased was selfemployed or received a fixed salary, an addition of 40% of the established income towards ‘future prospects’ is

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warranted when the deceased was below the age of 40 years. The said principle has been applied by the Tribunal to the present case.

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c) Thirdly, as per the judgment of the Hon’ble Supreme Court in the case of MAGMA GENERAL INSURANCE CO.

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LTD. –V- NANU RAM [2018 ACJ 2782] , each of the claimants is entitled to compensation of Rs.40,000/- under the head of ‘loss of love and affection and consortium’.

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d) Lastly, considering the age and avocation of the deceased, the overall compensation awarded by the Tribunal is inadequate and on the lower side.

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With the above contentions, the learned counsel sought to allow the appeal.

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On the other hand, the learned counsel for the Insurance Company has raised the following countercontentions:

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Liability:

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Admittedly, as on the date of accident, the offending vehicle was not having valid permit. Since the insured has

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violated the policy conditions, the Insurance Company is not liable to pay compensation, Hence, the Tribunal has rightly exonerated the Insurance Company from liability.

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Quantum of compensation

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a) Firstly, although the claimants claim that the deceased was earning Rs.15,000/- per month, they have failed to substantiate their claim with supporting documents. Consequently, the Tribunal has correctly assessed the income of the deceased notionally.

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b) Secondly, since the claimants have not established the income of the deceased, they are not entitled for compensation towards ‘future prospects’.

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c) Thirdly, on appreciation of oral and documentary evidence and considering the age and avocation of the deceased, the overall compensation awarded by the Tribunal is just and reasonable.

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d) Lastly, in light of the Division Bench decision of this Court in the case of MS.JOYEETA BOSE AND OTHERS –

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V- VENKATESHAN.V AND OTHERS (MFA 5896/2018

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AND CONNECTED MATTERS DISPOSED OF ON

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24.8.2020), the rate of interest awarded by the Tribunal at 8% p.a. on the compensation amount is on the higher side.

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With the above contentions, the learned counsel sought to dismiss the appeal.

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Heard the learned counsel for the parties and perused the judgment and award of the Tribunal.

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RE: QUANTUM OF COMPENSATION:

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It is not in dispute that Nagesh died in the road traffic accident occurred on 16.08.2014 due to rash and negligent driving of the offending vehicle by its driver.

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The claimants claim that deceased was earning Rs.15,000/- per month, but failed to produce supporting documents to substantiate their claim. In the absence of

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proof of income, the notional income has to be assessed. According to the guidelines issued by the Karnataka State

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Legal Services Authority, for accidents occurred in the year 2014, the notional income of the deceased shall be taken at Rs.8,500/- p.m. To the aforesaid income, 40% has to be added on account of future prospects in view of the law laid down by the Constitution Bench of the Supreme Court in ‘PRANAY SETHI’ (supra). Thus, the monthly income comes to Rs.11,900/-. Considering the number of dependents, the Tribunal has rightly deducted 1/3^rd of the income of the deceased towards personal expenses and remaining amount has been taken as his contribution to the family. The deceased was aged about 33 years at the time of the accident and multiplier applicable to his age group is ‘16’. Thus, the claimants are entitled to compensation of Rs.15,23,200/- (Rs.11,9001216*2/3) on account of ‘loss of dependency’.

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In addition, the claimants are entitled to compensation of Rs.15,000/- on account of ‘loss of estate’ and compensation of Rs.15,000/- on account of ‘funeral expenses’. Claimant No.1, wife of the deceased is

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NC: 2024:KHC:38313 MFA No. 9582 of 2018

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entitled for compensation of Rs.40,000/- under the head

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of 'loss of spousal consortium'.

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In view of the law laid down by the Supreme Court in

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the case of ‘MAGMA GENERAL INSURANCE’ (supra), claimant Nos.2 and 3, children of the deceased are entitled for compensation of Rs.40,000/- each under the head of ‘loss of parental consortium’.

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Thus, the claimants are entitled to the following

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compensation:

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Compensation under different Heads	Amount in (Rs.)
Loss of dependency	15,23,200
Funeral expenses	15,000
Loss of estate	15,000
Loss of spousal consortium	40,000
Loss of Parental consortium	80,000
Total	16,73,200

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RE: LIABILITY

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It is the contention of the Insurance Company that inspite of service of notice, the owner of the offending vehicle has been placed exparte before the Tribunal. It is also the specific contention that as on the date of accident, the offending vehicle was not having valid permit to ply the vehicle in State of Karnataka. They have also examined the RTO official as RW-1. Considering the same, the Tribunal has rightly exonerated the Insurance Company from liability.

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The Apex Court in the case of RANI –V- NATIONAL INSURANCE COMPANY LTD. (2018) 8 SCC 492 has held that if there is no valid permit, the Insurance Company is not liable to pay the compensation, but, however, since third party claim is involved, the Insurance Company has to pay compensation to the claimant and later recover the same from the insured.

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In view of the above, I am of the opinion that the Insurance Company has to pay compensation to the

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claimant and later recover the same from the owner of the offending vehicle. Hence, the finding of the Tribunal in respect of liability is concerned, the same is modified to the said extent.

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15. In the result, the following order is passed:

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ORDER

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a) The appeal is allowed in part .

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b) The judgment of the Claims Tribunal is modified. c) The claimants are entitled to a total compensation of

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Rs.16,73,200/- as against Rs.12,34,800/- awarded by the Tribunal.

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d) Following the judgment of the Division Bench of this Court in the case of ‘MS.JOYEETA BOSE’ (supra) , the entire compensation amount shall carry interest at 6% p.a.

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e) The Insurance Company is directed to deposit the compensation amount along with interest at 6% p.a. from the date of filing of the claim petition till the

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