Judgment:
IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No.1251 of 2012 (O&M) Date of decision:
29. 05.2013 Mohinder Singh son of Shri Kartar Singh, resident of Village Makrona Kalan, Tehsil Amloh Sahib, District Fatehgarh Sahib (owner of TATA Sumo not HR-01-F-6639) through its attorney Shri Randhir Singh. ...Appellant versus The New India Insurance Company Limited, Nangal, SCO 46-47, Phase-2, SAS Nagar, Tehsil and District SAS Nagar (insurer of TATA Sumo not HR-01-F-6639), and others. ....Respondents & FAO Nos.1416, 1272 and 1273 of 2012 (O&M) CORAM: HON’BLE MR. JUSTICE K. KANNAN ---- Present: Mr. Ashwani Arora, Advocate, for the appellant in FAO Nos.1251 and 1416 of 2012, and for respondent No.2 in FAO Nos.1272 and 1273 of 2012. Mr. Ashok Bector, Advocate, for the appellants in FAO Nos.1272 and 1273 of 2012, for respondents 2 to 6 in FAO No.1416 of 2012, for respondents 2 to 7 in FAO No.1251 of 2012. Mr. Ashwani Talwar, Advocate and Mr. Jagjit Singh, Advocate, for New India Insurance Company. Mr. Pankaj Katia, Advocate, for respondent No.7 in FAO No.1416 of 2012, for respondent No.8 in FAO No.1251 of 2012. Mr. Vishal Garg, AAG, Punjab. ---- FAO No.1251 of 2012 (O&M) -2- K.Kannan, J.(Oral) 1. All the appeals are connected. Of them, FAO Nos.1251 and 1416 of 2012 are at the instance of the owner/insured, challenging the liability cast on him for the compensation assessed and exonerating the Insurance Company, while the appeals in FAO Nos.1272 and 1273 of 2012 are at the instance of the claimants seeking for enhancement of compensation.
2. The issue of negligence of the driver was an established fact and the Tribunal, while assessing the issue of liability, had to contend with an objection by the Insurance Company that the number plate of the vehicle HR-01-F-6639, which was involved in the accident, had been a fake and the insured having committed a serious concealment about the identity of the vehicle had been guilty of a fundamental breach that would exclude the liability of the Insurance Company. At the trial, the Insurance Company produced RW2-a Clerk from the SDM's office, Ambala, to show that as per their record, there had been no vehicle registered at their office with the registration number given by producing the original register. There was no entry against the Registration not HR-01-F-6639. Since it was elicited that heavy vehicles were registered by RTA- cum-DTO, Ambala, a Clerk from the office of RTA-cum-DTO has also been examined as RW5, who affirmed that there was no vehicle with the above said registration number registered in their office. FAO No.1251 of 2012 (O&M) -3- Considering the fact that a new registration had been made by him for the very same vehicle as PB-12-L-8107 subsequent to the accident, the Court found that there was no valid insurance and exonerated the Insurance Company.
3. In the appeals, this Court had sought to elicit information as to how the registration number came to be prepared and had called for a report from the Deputy Superintendent of Police (Rural), District Roopnagar. The report has been filed by the DSP and it has been brought on record that suggests that there had been a case of miscommunication between the transferor and transferee and the time when the information of transfer had been brought to the DTO's office. The report suggests that there had been no concealment or fraud practiced. I make reference to this report only because the Court had secured such a report in its effort to find whether there had been any act of fraud committed by the insurer to secure the fake number. I would think even this exercise was unnecessary if we examine the fact that the insurance policy made reference not merely to the registration number but also to number of engine and chassis as 95623 and 37410 respectively. The registration number which is required for a vehicle is a statutory mandate under the relevant provisions of the Motor Vehicles Act and the Rules in order that the vehicle is known as a visible identifying mark for several of the regulatory exercises brought out FAO No.1251 of 2012 (O&M) -4- through the Act and the Rules. As far as the Insurance Company is concerned, the registration number has still a value that it is of motorable state and that it is a motor vehicle that comes within the definition of Motor Vehicles Act. This also is a sure meaning to the Insurance Company to fix the identity of the owner and relate to a particular vehicle as a vehicle which is covered under the policy of insurance. This is one of the modes of fixing the identity of the vehicle. Being a visible identifying mark, a plate could be changed, refurbished or reprinted but a chassis number or engine number are not capable of being tampered in the same manner. As far as the Insurance Company is concerned, if it was also taking engine number and chassis number that was a sure method of identification of the vehicle. Both as regards the vehicle which had a cover for insurance as well as to test whether the particular vehicle was involved in the accident or not, it is not No.in dispute that the particular vehicle which was insured with the Insurance Company had been involved in the accident as a matter of fact. The period of insurance cover and the date when the accident had taken place are also not in dispute. If there had been any fraud or deception in taking the insurance policy that will have a bearing to the policy status itself, then it could be a plea that would be available for an Insurance Company to exonerate the Insurance Company. The principle of uberrima-feidi is brought on a fundamental issue of trust FAO No.1251 of 2012 (O&M) -5- that a person that secures a cover makes a disclosure of whatever defect that the insured object is beset with. Every wrong representation cannot become a misrepresentation. Such misrepresentation ought to have a nexus to secure a valid policy and that which will cast the Insurance Company, a liability if not for such a misrepresentation. In this case, for whatever reasons, if there had been even a fabrication of a number plate, it cannot be stated to be for any situation that benefited the owner by taking the Insurance Company for a registration number which was falsely imprinted on the number plate. I will not find that even if there had been a fake number plate, it did not go to the root of the issue regarding the validity of the policy of insurance. Exoneration of the Insurance, under the circumstances, was unjustified. If there had been a negligence established, the consequences of making the insurer liable for the compensation assessed must have been the necessary sequeter. The finding to the contrary by the court below is set aside and the appeals by the owner seeking for indemnity would require to be favourably considered.
4. As regards the quantum in the appeal in FAO No.1272 of 2012, the claim was at the instance of the legal representatives of an Executive in a private company, drawing an annual salary of ` 7,55,699/-. The claimants were widow, two minot children and parents. The Court made deductions towards tax and applied a 1/3rd FAO No.1251 of 2012 (O&M) -6- deduction for personal expenses. The plea in appeal by the claimants is that the deduction must have been 1/4th in terms of the law laid down by the Supreme Court in Sarla Verma Versus Delhi Transport Corporation and another-2009(6) SCC 121.The Tribunal, however, applied a 1/3rd multiplier on a reasoning that the parents were not shown to be dependents and, therefore, the deduction could not be applied. I am afraid, the reasoning was erroneous. Even amongst the parents, mother is a class-I heir. The amount that is determined is not necessarily only on the component of dependence. Mother takes a share in the estate of the deceased. Consequently, the deduction shall be taken by providing for a right of entitlement to the mother even without having to prove her dependence. At least, there ought not to be a scope for suspecting issue of dependence unless specific evidence was brought against the same. Again, unless specific evidence was brought by the respondent who is made liable that special circumstances existed to deny a share to a class-I heir, the claim to compensation to a heir cannot be denied. I do not find any such situation to deny a consideration for mother as a representative. The deduction ought to have been therefore 1/4th.
5. The counsel also has a grievance that the Tribunal has not provided for future prospect of increase. The deceased was in a settled employment in a private company, drawing a handsome FAO No.1251 of 2012 (O&M) -7- salary. He was 35 years of age and I have no reason to suspect that the income could have been stagnant. I will provide for future prospect of increase in salary by 50% and take the gross salary as ` 11,33,550/-. I take 30% towards income tax being in the higher income bracket and take the salary less tax at ` 7,93,485/-. I will make a 1/4th deduction and apply a multiplier of 15. The total loss of dependency would come to ` 89,26,706/-. I would also provide for loss of consortium and loss of love and affection for the children at an additional amount of ` 25,000/- and make a further provision of `25,000/- towards funeral expenses and take the loss to estate at `10,000/-. The total compensation would come to `89,86,706, round off to `89,86,700/-. The compensation shall be shared amongst the claimants, namely, widow, minot children and the parents together as one unit in the ratio of 2:2:2:1:1.
6. Since the accident had taken place in the year 2009 and I have adopted a multiplier of 15. I will allow for 30% of the amount to be withdrawn by the first claimant, namely, widow and the rest of the 70% shall be placed in a fixed deposit for a period of 12 years, equated in 12 portions, the first portion for a period of one year, second portion for a period of two years and so on upto 12 years. The amount shall be paid to the claimant on the respective dates of maturity. As far as the minot children's share is concerned, the same will be retained in fixed deposits for the entire period of respective FAO No.1251 of 2012 (O&M) -8- minority and on their attaining majority, 75% of the same shall be permitted to be withdrawn and the rest of 25% shall be retained for a period of 5 years, split in equal portions, the first portion for a period of one year and the second portion for a period of two years and so on upto 5 years. Interest shall be periodically given to the parents in a quarter of year for maintenance of the children. As far as the parents are concerned, their share will be released without having to retain in deposit for any length of time. The award stands modified and the appeal in FAO No.1272 of 2012 is allowed to the above extent with interest added at 7.5% per annum for the enhanced compensation.
7. As regards the claim of compensation in the appeal in FAO No.1273 of 2012, the contention is that the Court has provided only for 6% interest which is grossly low. The only modification that will subject the award is to raise the rate of interest at 7.5% per annum against 6% as awarded already by the Tribunal.
8. All the appeals are allowed. The appeals by the owner of the vehicle are also allowed to obtain right of indemnity from the insurer and the appeals by the claimants would obtain enhancement in the manner referred to above. (K.KANNAN) JUDGE 29 05.2013 sanjeev