Rajesh Tandon, J.
1. Heard Mr. D.S. Patni, counsel for the appellant and Mr. L.K. Tiwari, Mr. P.C. Bisht and Mr. Kishor Kumar, counsel for the respondents.
2. This is insurer's appeal against the award dated 28.6.2003, passed by Motor Accidents Claims Tribunal, Almora.
3. The claimant Prem Bisht preferred a claim petition under Section 166 of the Motor Vehicles Act, 1988 for the grant of compensation on account of the death of Govind Singh in a motor vehicle accident. According to the claimant on the fateful day on 2.3.2002 at about 7.30 p.m., the deceased was travelling by jeep No. UP 01-3159. The vehicle was being driven by its driver rashly and negligently, with the result when the vehicle reached near Bady-ura village the driver lost control over the vehicle and it fell down into a ditch. The deceased sustained fatal injuries and he succumbed to his injuries instantaneously.
4. Opposite party Shamsher Singh, the respondent No. 2, filed written statement and admitted the factum of accident but denied that the accident took place due to rash and negligent driving by its driver. He has stated that the driver had valid driving licence. The vehicle was insured with the appellant United India Insurance Co. Ltd. and insurance company is liable to pay compensation, if any.
5. The insurance company, appellant has admitted the insurance of the vehicle but it has been denied that the accident had taken place due to negligence of driver of the offending vehicle. The insurance company has alleged that the vehicle was being plied against the terms and conditions of the insurance policy. The driver had no valid driving licence and the owner of the vehicle has no valid permit and fitness certificate.
6. In order to prove their case, the claimant has examined Prem Bisht as PW 1 and has also filed copy of post-mortem report, copy of F.I.R. and copy of Pariwar register. The opposite party owner of the vehicle has filed copy of driving licence, insurance cover note and fitness certificate. The opposite party insurance company has filed survey report and has also examined the surveyor Chandra Pal Singh Tomar as DW 1.
One the basis of the evidence adduced by the claimant, the Claims Tribunal has held that the accident had taken place due to rash and negligent driving of jeep No. UP 01-3159.
7. So far as the compensation is concerned, Tribunal has recorded the finding that at the time of accident the age of the deceased was 32 years. Claims Tribunal held that deceased was doing business but there was no documentary proof regarding his income. Therefore, the Claims Tribunal has held the notional income of the deceased as Rs. 15,000 per annum. After deducting 1/3rd amount, i.e., Rs. 5,000 for his own expenses, the annual dependency of claimant on the income of the deceased was assessed at Rs. 10,000. The Claims Tribunal selected multiplier of 17 and thus worked out compensation of Rs. 1,70,000. A sum of Rs. 2,000 for funeral expenses was awarded and a sum of Rs. 5,000 was paid for the loss of consortium. Thus, a total compensation of Rs. 1,77,000 was awarded to the claimant.
8. Mr. D.S. Patni, counsel for the appellant has submitted that Claims Tribunal has erred in assessing the compensation and the amount of compensation awarded to the claimant is excessive.
9. Mr. D.S. Patni has further submitted that the driver of the vehicle has no valid driving licence, as there is no endorsement in the driving licence regarding authority to drive the vehicle in hill areas. Mr. D.S. Patni has referred Rule 193 of Motor Vehicles Rules, 1998, which reads as under:
193. Endorsement of certain licences for hill roads.--No person shall drive a public service vehicle or a goods vehicle on a hill road unless his licence to drive such public service vehicle or goods vehicle has been endorsed by a registering authority with a permission to drive upon hill roads situated within the jurisdiction of such registering authority or in the case of a public service vehicle hired by tourists, by the registering authority of the State with which reciprocal arrangements on the point have been agreed upon.
10. On the other hand, the counsel for the respondents Mr. Kishor Kumar, Mr. L.K. Tiwari and Mr. P.C. Bisht have submitted that aforesaid endorsement is only applicable for public service vehicles and further there being no such provision under the Motor Vehicles Act, therefore, Rule 193 cannot be held to be applicable.
I have considered the submissions in the light of the above rules and I find that if there was no endorsement of authorisation to drive the vehicles in hills, the licence cannot be held invalid.
11. The Supreme Court in the case of United India Insurance Co. Ltd. v. Lehru MANU/SC/0219/2003 : [2003]2SCR495 , has held that where the driver's licence is found fake, liability of insurance company towards third party does not get avoided. The Apex Court has observed as under:
(17) When an owner is hiring a driver he will therefore have to check whether the driver has a driving licence. If the driver produces a driving licence which on the face of it looks genuine, the owner is not expected to find out whether the licence has in fact been issued by a competent authority or not. The owner would then take the test of the driver. If he finds that the driver is competent to drive the vehicle, he will hire the driver. We find it rather strange that insurance companies expect owners to make enquiries with R.T.Os., which are spread all over the country, whether the driving licence shown to them is valid or not. Thus, where the owner has satisfied himself that the driver has a licence and is driving competently there would be no breach of Section 149(2)(a)(ii). The insurance company would not then be absolved of its liability. If it ultimately turns out that the licence was fake, the insurance company would continue to remain liable unless they prove that the owner-insured was aware or had noticed that the licence was fake and still permitted that person to drive. More importantly, even in such a case the insurance company would remain liable to the innocent third party, but it may be able to recover from the insured. This is the law which has been laid down in Skandia's case 1987 ACJ 411 (SC); Sohan Lal Passi's case MANU/SC/0662/1996 : AIR1996SC2627 and Kamla's case MANU/SC/0202/2001 : [2001]2SCR797 . We are in full agreement with the views expressed therein and see no reason to take a different view.
12. In the case of National Insurance Co. Ltd. v. Swaran Singh MANU/SC/0021/2004 : AIR2004SC1531 , the Apex Court has held as under:
(102)(iii) The breach of policy conditions, e.g., disqualification of driver or invalid driving licence of the driver, as contained in Sub-section (2)(a)(ii) of Section 149, has to be proved to have been committed by the insured for avoiding liability by the insurer. Mere absence, fake or invalid driving licence or disqualification of the driver for driving at the relevant time, are not in themselves defences available to the insurer against either the insurer or the third parties. To avoid its liability towards insured, the insurer has to prove that the insured was guilty of negligence and failed to exercise reasonable care in the matter of fulfilling the condition of the policy regarding use of vehicles by a duly licensed driver or one who was not disqualified to drive at the relevant time.
xxx xxx xxx(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards the insured unless the said breach or breaches of the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. Tribunals in interpreting the policy conditions would apply 'the rule of main purpose' and the concept of 'fundamental breach' to allow defences available to the insurer under Section 149(2) of the Act.
13. The Apex Court in the case of Lai Chand v. Oriental Insurance Co. Ltd. MANU/SC/8433/2006 : (2006)7SCC318 , after placing reliance upon the case-law enumerated in the case of New India Assurance Co. Ltd. v. Kamla MANU/SC/0202/2001 : [2001]2SCR797 ; United India Insurance Co. Ltd. v. Lehru MANU/SC/0219/2003 : [2003]2SCR495 and National Insurance Co. Ltd. v. Swaran Singh MANU/SC/0021/2004 : AIR2004SC1531 , has held as under:
(9) In the instant case, the owner has not only seen and examined the driving licence produced by the driver but also took the test of the driving of the driver and found that the driver was competent to drive the vehicle and thereafter appointed him as driver of the vehicle in question. Thus, the owner had satisfied himself that the driver had a licence and was driving competently, there would be no breach of Section 149(2)(a)(ii) and the insurance company would not then be absolved of its liability.
14. Owner of the vehicle has mentioned in his written statement that the driver of the vehicle was an expert driver having valid driving licence. He filed the copy of licence along with his written statement. Hence, in view of the observations made above, there would be no breach of Section 149(2)(a)(ii) on account of the non-endorsement of hill driving licence and the insurance company cannot be absolved from his liability.
15. Similar view has been taken by the Division Bench of this Court in New India Assurance Co. Ltd. v. Kala Devi A.O. No. 139 of 2005; decided on 31.10.2006.
16. So far as the compensation is concerned, the claimant has mentioned in the claim petition that the deceased was doing business and was earning Rs. 5,000 per month but there is no documentary proof regarding the income of the deceased and as such the Claims Tribunal has assessed the notional income of the deceased at Rs. 15,000 per annum. A deduction of 1/3rd for the own expenses of the deceased, if he would have been alive, is to be made and thus the annual dependency of the claimant on the income of the deceased comes to Rs. 10,000. So far as selection of multiplier is concerned the claimant is the wife of the deceased. The age of the deceases at the time of accident was 32 years and thus the Claims Tribunal has rightly selected multiplier of 17. Claims Tribunal awarded compensation of Rs. 1,70,000. A further sum of Rs. 2,000 was awarded for funeral expenses and Rs. 5,000 for loss of consortium and thus a total sum of Rs. 1,77,000 was awarded as compensation. A sum of Rs. 1,000 was also awarded as litigation expenses.
17. Claimant, respondent No. 1, filed cross-objection and prayed for enhancement of the amount of compensation. It has been submitted on behalf of the claimant that the notional income as assessed by the Claims Tribunal to the extent of Rs. 15,000 is too meagre and it should at least to be Rs. 30,000 per annum. The counsel for the claimant has placed reliance on the case of Basanti Devi v. Naresh Rangar 2007 (1) UD 11, where a Division Bench of this High Court held as under:
Section 163-A of the Motor Vehicles Act reads as follows:
163-A. Special provisions as to payment of compensation on structured formula basis.--(1) Notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle or the authorised insurer shall be liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be.
xxx xxx xxx(2) In any claim for compensation under Sub-section (1), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person.
(3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time amend the Second Schedule.
Above quoted Sub-section (3) of Section 163-A casts a duty on the Central Government to amend the Second Schedule from time to time keeping in view the increase in the cost of living in spite of the lapse of a period of more than 10 years, the Second Schedule has not been amended by the Central Government. We, therefore, deem it proper to take into consideration the erosion in the purchase value of the rupee during the period between 1994 and 2003 (the year of the accident in the present case). By taking into consideration the steep hike in the price index of the essential commodities and the resultant increase in the cost of living, we are of the opinion that the notional income of Rs. 15,000 per annum prescribed in the Second Schedule in the year 1994, would, in the year 2003, comes to Rs. 30,000 per annum.
18. Thus, in view of the above, I hold the notional income of the deceased to be Rs. 30,000 instead of Rs. 15,000 as held by the Claims Tribunal. After deducting a sum of Rs. 10,000 for the own expenses of the deceased, if he would have been alive, the annual dependency of the claimant on the income of the deceased comes to Rs. 20,000. By multiplying the annual income by the selected multiplier of 17 the compensation comes to Rs. 20,000 17 = Rs. 3,40,000. A further sum of Rs. 2,000 is granted towards funeral expenses and Rs. 5,000 towards loss of consortium is also granted to the claimant. Thus, the total compensation comes to Rs. 3,47,000, which appears justified in view of the observations made by the Apex Court in the case of Tamil Nadu State Trans Corporation Ltd. v. S. Rajapriya MANU/SC/0313/2005 : AIR2005SC2985 , as under:
(8) But the assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have lived or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that deceased might have got better employment or income or might have lost his employment or income altogether.
(9) The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependants, and to deduct therefrom such part of his income as the deceased was accustomed to spend upon himself, as regards both self maintenance and pleasure and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependants. Then that should be capitalised by multiplying it by a figure representing the proper number of years' purchase.
(10) Much of the calculation necessarily remains in the realm of hypothesis 'and in that region arithmetic is a good servant but a bad master' since there are so often many imponderables. In every case 'it is the overall picture that matters' and the court must try to assess as best as it can the loss suffered.
19. The Claims Tribunal has awarded interest at the rate of 9 per cent per annum which is modified to the extent of 7 per cent per annum.
20. In view of above, the appeal is devoid of merit and is hereby dismissed.
21. The cross-objection filed by the claimant is allowed and the compensation awarded by the Claims Tribunal is enhanced to the extent of Rs. 3,47,000 along with pendente lite and future interest at the rate of 7 per cent per annum.
22. No order as to costs.