Full Text
HIGH COURT OF DELHI
Date of Decision: 9th May, 2012
NATIONAL INSURANCE CO. LTD. ..... Appellant
Through: Mr. Pradeep Gaur, Adv. with Mr. Amit Gaur, Adv.
Mr. Shashank Sharma, Adv.
Through: Mr. O.P. Mannie, Adv. for R-1.
BHARAT RAM MITTAL ..... Appellant
Through: Mr. O.P. Mannie, Adv.
Through: Mr. Pradeep Gaur, Adv. with Mr. Amit Gaur, Adv.
Mr. Shashank Sharma, Adv.
JUDGMENT
These are Cross Objections filed by Respondent No.1.
It may be registered as an Appeal.
2012:DHC:3190
1. The Appellant National Insurance Company Limited in MAC APP.473/2007 seeks exoneration from its liability to pay the compensation of `1,79,774/- awarded in favour of the First Respondent Bhagat Ram Mittal, the Appellant in Cross Appeal, who suffered injuries in a motor accident which occurred on 31.01.2005.
2. Bhagat Ram Mittal, the First Respondent in MAC APP.473/2007 and Appellant in MAC APP. 518/2012 seeks enhancement of compensation on the ground that the compensation awarded is inadequate.
3. It is urged by the learned counsel for the Appellant Insurance Company that the Appellant successfully proved that Respondent No.2 Jabbar Singh driver of vehicle No.DL-IRF- 9097 did not possess a valid driving licence at the time of the accident, yet instead of exonerating it from its liability, the Claims Tribunal only granted recovery rights from Respondents No.3 and 4 herein.
4. As per Section 149(2)(a), an insurer is entitled to defend the action on the grounds as mentioned under Section 149(2)(a)(i) of the Act. Thus, the onus is on the insurer to prove that there is breach of the condition of the policy. It is well settled that the breach must be conscious and willful. Even if a conscious breach on the part of the insured is established, still the insurer has a statutory liability to pay the compensation to the third party and will simply have the right to recover the same from the insured/tortfeasor either in the same proceedings or by independent proceedings as the case may be, as ordered by the Claims Tribunal or the Court. The question of statutory liability to pay the compensation was discussed in detail by a two Judge Bench of the Supreme Court in Skandia Insurance Company Limited v. Kokilaben Chandravadan, (1987) 2 SCC 654 where it was held that exclusion clause in the contract of Insurance must be read down being in conflict with the main statutory provision enacted for protection of victim of accidents. It was laid down that the victim would be entitled to recover the compensation from the insurer irrespective of the breach of the condition of policy. The three Judge Bench of the Supreme Court in Sohan Lal Passi v. P. Sesh Reddy, (1996) 5 SCC 21 analyzed the corresponding provision under the Motor Vehicles Act, 1939 and the Motor Vehicles Act, 1988 and approved the decision in Skandia (supra). In New India Assurance Co., Shimla v. Kamla and Ors., (2001) 4 SCC 342, the Supreme Court referred to the decision of the two Judge Bench in Skandia(supra), the three Judge Bench decision in Sohan Lal Passi(supra) and held that the insurer who has been made liable to pay the compensation to third parties on account of certificate of insurance issued, shall be entitled to recover the same if there was any breach of the policy condition on account of the vehicle being driven without a valid driving licence. The relevant portion of the report is extracted hereunder:
5. Again in United India Insurance Company Ltd. v. Lehru & Ors., (2003) 3 SCC 338, in para 18 of the report the Supreme Court referred to the decision in Skandia(supra), Sohan Lal Passi(supra) and Kamla(supra) and held that even where it is proved that there was a conscious or willful breach as provided under Section 149(2)(a) (ii) of the Motor Vehicle Act, the Insurance Company would still remain liable to the innocent third party but may recover the compensation paid from the insured. The relevant portion of the report is extracted hereunder:
6. The three Judge Bench of the Supreme Court in National Insurance Company Limited v. Swaran Singh & Ors., (2004) 3 SCC 297 again emphasized that the liability of the insurer to satisfy the decree passed in favour of the third party was statutory. It approved the decision in Sohan Lal Passi (supra), Kamla (supra) and Lehru (supra). Para 73, 103 and 105 of the report are extracted hereunder:
7. This Court in MAC APP. No.329/2010 Oriental Insurance Company Limited v. Rakesh Kumar and Others and other Appeals decided by a common judgment dated 29.02.2012, noticed some divergence of opinion in National Insurance Company Limited v. Kusum Rai & Ors., (2006) 4 SCC 250, National Insurance Company Limited v. Vidhyadhar Mahariwala & Ors., (2008) 12 SCC 701; Ishwar Chandra & Ors. v. The Oriental Insurance Company Limited & Ors., (2007) 10 SCC 650 and Premkumari & Ors. v. Prahalad Dev & Ors., (2008) 3 SCC 193 and held that in view of the three Judge Bench decision in Sohan Lal Passi(supra) and Swaran Singh(supra), the liability of the Insurance Company vis-à-vis the third party is statutory. If the Insurance Company successfully proves the conscious breach of the terms of the policy, then it would be entitled to recovery rights against the owner or driver, as the case may be.
8. The Appellant Insurance Company established the willful breach of the terms of policy and therefore, it was entitled to recovery rights which have been duly granted. The Appeal filed by the Insurance Company fails; the same is accordingly dismissed.
9. It is the time to refer to the Cross-Objections filed by the First Respondent.
10. The Claims Tribunal awarded a compensation of `2,35,774/which is tabulated hereunder:-
┌──────────────────────────────────────────────────────────────────────────────────────────────────────┐ │ which is tabulated hereunder:- │ │ Sl. Compensation under various Awarded by the │ │ heads Claims Tribunal │ │ No. │ ├──────────────────────────────────────────────────────────────────────────────────────────────────────┤ │ 1. Compensation for medical expenses `1,06,695/- │ │ 2. Compensation for Conveyance & ` 10,000/- │ │ Special Diet │ │ 3. Compensation for Permanent ` 33,079/- │ │ Disability │ │ 4. Compensation for Future Expenses ` 31,000/- │ │ 5. Compensation for Loss of Income ` 25,000/- │ │ 6. Compensation for Pain & Suffering ` 30,000/- │ │ and Loss of Amenities of Life │ │ Total ` 2,35,774/- │ │ MAC. APP. 473/2007 & 518/2012 Page 8 of 13 │ │ 2012:DHC:3190 │ │ 11. In General Manager, Kerala State Road Transport │ │ Corporation, Trivandrum v. Susamma Thomas (Mrs.) and Ors, │ │ (1994) 2 SCC 176, the Supreme Court observed that the │ │ determination of the quantum must answer what contemporary │ │ society “would deem to be a fair sum such as would allow the │ │ wrongdoer to hold up his head among his neighbours and say │ │ with their approval that he has done the fair thing”. The amount │ │ awarded must not be niggardly since the law values life and │ │ limb in a free society in generous scales. At the same time, a │ │ misplaced sympathy, generosity and benevolence cannot be the │ │ guiding factor for determining the compensation. The object of │ │ providing compensation is to place the claimant(s), to the extent │ │ possible, in almost the same financial position, as they were in │ │ before the accident and not to make a fortune out of misfortune │ │ that has befallen them. │ │ 12. The Appellant suffered fracture of both bone left lower leg, │ │ abrasions and blunt injuries all over his body. He was admitted │ │ in Max Hospital on 31.01.2005 to 03.02.2005. He was shifted │ │ to Jaipur Golden Hospital and remained admitted there upto │ │ 08.02.2005. │ │ 13. The Appellant underwent surgery and screws were put to give │ │ strength to the bones. The Appellant made over a dozen visits │ │ to Dr. Raj Kumar. On 22.06.2005, the Appellant underwent │ │ MAC. APP. 473/2007 & 518/2012 Page 9 of 13 │ │ 2012:DHC:3190 │ │ another surgery as the fracture showed “delayed union”. On │ │ 28.06.2005, the Appellant was readmitted to Jaipur Golden │ │ Hospital where plating and bone grafting was done on the left │ │ leg. │ │ 14. The Appellant deposed that he was working as a Commission │ │ Agent in the name and style of M/s. Ashok Kumar Anil Kumar, │ │ due to injuries suffered by him, he cannot run his business │ │ properly, he cannot walk properly, he cannot lift weight. │ │ 15. The Appellant was issued a Disability Certificate showing │ │ disability of 20% in respect of the left lower limb which the │ │ doctors stated to be 7.5% in respect of whole body which was │ │ accepted by the Claims Tribunal. │ │ 16. It is urged by the learned Counsel for the Appellant that the │ │ Claims Tribunal accepted the fact that the Appellant could not │ │ attend to his business for a period of six months, his │ │ (Appellant’s) income on the basis of the Income Tax Return │ │ (ITR) Ex.PW-1/89 for the Assessment year 2005-06 was duly │ │ proved as `88,210/-, yet the Claims Tribunal awarded a │ │ compensation of just ` 25,000/-. │ │ 17. In my view, the Appellant (the injured) is entitled to be │ │ compensated for loss of actual income for six months which │ │ comes about to `44,105/- rounded off to `45,000/-. The │ │ compensation for loss of income is thus enhanced from │ │ `25,000/- to `45,000/-. │ │ MAC. APP. 473/2007 & 518/2012 Page 10 of 13 │ │ 2012:DHC:3190 │ │ 18. The Claims Tribunal awarded compensation of `33,079/- │ │ towards permanent disability. This was really towards loss of │ │ earning capacity. Claimants income was proved to be `88,210/- │ │ per annum. The loss of earning capacity would come to │ │ `46,310/- (88210/- x 7.5% x 7), which is rounded off to │ │ `50,000/-. │ │ 19. A consolidated compensation of ` 30,000/- was awarded │ │ towards pain and suffering and loss of amenities in life. In my │ │ view, it would be appropriate to grant the compensation │ │ separately under the head of pain and suffering and loss of │ │ amenities in life. │ │ 20. It is difficult to measure in terms of money the pain and │ │ suffering which has been suffered by the claimant on account of │ │ serious injuries caused to him in a motor accident. Since the │ │ compensation is required to be paid for pain and suffering an │ │ attempt must be made to award compensation which may have │ │ some objective relation with the pain and suffering underwent │ │ by the victim of a motor accident. For this purpose, the Claims │ │ Tribunal and the Courts normally consider the nature of injury; │ │ the parts of the body where the injuries were sustained; │ │ surgeries (if any) underwent by the victim; confinement in the │ │ hospital and the duration of the treatment. │ │ 21. Considering the nature of injuries suffered, surgeries underwent, │ │ and duration of treatment, I award a sum of `30,000/- towards │ │ MAC. APP. 473/2007 & 518/2012 Page 11 of 13 │ │ 2012:DHC:3190 │ │ pain and suffering. │ │ 22. The Appellant’s testimony that he cannot walk properly and he │ │ cannot lift weight was not challenged in the cross-examination. │ │ He has suffered permanent disability to the extent of 20% in │ │ respect of left lower limb which was assessed to be 7.5% in │ │ respect of whole body. There was shortening of his (the │ │ injured’s) leg by 1.5 cm. Considering all these facts and that │ │ fact that the Appellant was aged 61 years, I would make an │ │ award of `40,000/- towards loss of amenities and disfigurement. │ │ 23. The compensation awarded is thus re-assessed as under:- │ │ No. │ │ 1. Compensation for medical expenses `1,06,695/- │ │ 2. Compensation for Conveyance & Special ` 10,000/- │ │ Diet │ │ 3. Compensation for Permanent Disability/ ` 50,000- │ │ Loss of Earning Capacity │ │ 4. Compensation for Future Expenses ` 31,000/- │ │ 5. Compensation for Loss of Income ` 45,000/- │ │ 6. Compensation for Pain & Suffering ` 30,000/- │ │ 7. Loss of Amenities & Disfigurement ` 40,000/- │ │ Total ` 3,12,695/- │ │ MAC. APP. 473/2007 & 518/2012 Page 12 of 13 │ │ 2012:DHC:3190 │ │ 24. The overall compensation is thus enhanced from `2,35,774/- to │ │ `3,12,695/-. │ │ 25. The enhanced compensation of `76,921/- rounded off to │ │ `77,000/- shall carry interest @ 7.5% per annum from the date │ │ of filing of the Petition till its deposit in this Court. │ │ 26. Respondent National Insurance Company Limited is directed to │ │ deposit the enhanced amount along with interest in UCO Bank, │ │ Delhi High Court, New Delhi in the name of the Appellant. │ │ 27. On deposit, the amount shall be released to the Appellant │ │ immediately. │ │ 28. MAC APP.518/2012 filed by the injured Appellant is allowed │ │ in above terms. │ │ 29. The statutory amount of `25,000/- deposited in MAC │ │ APP.473/2007 be refunded to the Insurance Company. │ │ (G.P. MITTAL) │ │ JUDGE │ │ MAY 09, 2012 │ │ vk │ │ MAC. APP. 473/2007 & 518/2012 Page 13 of 13 │ └──────────────────────────────────────────────────────────────────────────────────────────────────────┘
1.[5] cm. Considering all these facts and that fact that the Appellant was aged 61 years, I would make an award of `40,000/- towards loss of amenities and disfigurement.
23. The compensation awarded is thus re-assessed as under:- Sl. No. Compensation under various heads Awarded by this Court
1. Compensation for medical expenses `1,06,695/-
2. Compensation for Conveyance & Special Diet ` 10,000/-
3. Compensation for Permanent Disability/ Loss of Earning Capacity ` 50,000-
4. Compensation for Future Expenses ` 31,000/-
5. Compensation for Loss of Income ` 45,000/-
6. Compensation for Pain & Suffering ` 30,000/-
7. Loss of Amenities & Disfigurement ` 40,000/- Total ` 3,12,695/-
24. The overall compensation is thus enhanced from `2,35,774/- to `3,12,695/-.
25. The enhanced compensation of `76,921/- rounded off to `77,000/- shall carry interest @ 7.5% per annum from the date of filing of the Petition till its deposit in this Court.
26. Respondent National Insurance Company Limited is directed to deposit the enhanced amount along with interest in UCO Bank, Delhi High Court, New Delhi in the name of the Appellant.
27. On deposit, the amount shall be released to the Appellant immediately.
28. MAC APP.518/2012 filed by the injured Appellant is allowed in above terms.
29. The statutory amount of `25,000/- deposited in MAC APP.473/2007 be refunded to the Insurance Company.
JUDGE MAY 09, 2012 vk