HONOURABLE Dr. JUSTICE B.SIVA SANKARA RAO M.A.C.M.A.No.3062 OF201102-01-2014 The Managing Director, APSRTC, Musheerabad, Hyderabad....Appellant Bandaru Venkata Narsamma and 5 others.... Respondents Counsel for the Petitioner : Sri P.Harinadh Gupta Counsel for the Respondents: Sri V.Brahmayya Chowdary : : ?.Cases referred:
1. (2011)8 SCC1422. 2013(1) ALD644(FB) 3. 1965(1) All. E.R - 563 4. 1963(2) All. E.R - 432 5. 1969(1) All. E.R - 555 6. 1955 ACJ366(SC) 7. 2009 ACJ12988. (2001)8 SCC1979. 2013(4) ALT35(SC) 10. 2011(8) SCALE24011. (1988)3 SCC112. 2013(1) ALD644HONOURABLE Dr. JUSTICE B.SIVA SANKARA RAO M.A.C.M.A.No.3062 OF2011JUDGMENT
: The Managing Director, A.P.S.R.T.C-3rd respondent filed this appeal, having been aggrieved by the Order/Award of the learned Chairman of the Motor Accidents Claims Tribunal-cum-I Additional District Judge, Khammam,(for short, 'Tribunal') in M.V.O.P.No.452 of 2009 dated 07.02.2011, awarding compensation of Rs.3,29,000/-(Rupees three lakhs twenty nine thousand only) with interest at 7.5% per annum with the finding that the 3rd respondent alone is liable and not the respondents 1 and 2 as against the claim of the claimants 1 to 4 of Rs.5,00,000/-(Rupees Five lakhs only), in the claim petition under Section 166 of the Motor Vehicle Act, 1988 (for short, 'the Act').
2. Heard Sri Sridhar Reddy Pottigari, the learned standing counsel for the appellant (APSRTC), Sri V.Brahmaiah Chowdary, learned counsel for the respondents 1 to 4 (claimants) and Sri P.Harinadh Gupta learned counsel for the 6th respondent (insurer). The 5th respondent (owner of the bus hired to appellant RTC-served is remained absent and thus taken as heard the 5th respondent to decide on merits. Perused the material on record. The parties hereinafter are referred to as arrayed before the Tribunal for the sake of convenience in the appeal.
3. The contentions in the grounds of appeal by the (appellant) 3rd respondent- APSRTC in nutshell are that though it is the hire bus with A.P.S.R.T.C since belongs to the 1st respondent insured with the 2nd respondent insurer of the claim petition, instead of finding the liability jointly and severally against the respondents 1 and 2; the Tribunal went wrong in fastening the liability on the A.P.S.R.T.C only and thus the award of the Tribunal is contrary to law, weight of evidence and probabilities of the case in arriving such a wrong conclusion; besides the quantum of compensation awarded is excessive and outcome of wrong application of multiplier and wrong taking of the income of the deceased and hence to allow the appeal, by exonerating the APSRTC besides reducing the quantum.
4. It is in support of above contentions of the 3rd respondent, relied upon the Apex Court's expression in Uttar Pradesh State Road Transport Corporation V. Kulsum1 and the Full Bench Judgment of this Court reported in APSRTC, Hyderabad V. B.kanakaratnabai2 and another Division Bench Judgment dated 31.01.2013 in M.A.C.M.A.No.2821 of 2011 following the full bench expression mainly on the contention of the insured and insurer of the hire bus are liable jointly and severally and not the 3rd respondent-A.P.S.R.T.C. The claimants sought for joint liability by saying on quantum as what is awarded is low and to enhance the same if at all.
5. Whereas, it is the contention of the learned counsel for the respondent No.2 insurer of said bus before the Tribunal, that the Tribunal came to the right conclusion by following several expressions including of the Apex Court and of this Court and thus while sitting against the same, for this Court, there is nothing to interfere, but for if at all to reduce the quantum of compensation.
6. Now the points that arise for consideration in the appeal are:
1. Whether the finding of the Tribunal in fixing the liability only against the 3rd respondent-A.P.S.R.T.C. by exonerating the respondents 1 & 2 i.e., insured and the insurer of the bus that was hired with the 3rd respondent-A.P.S.R.T.C is unsustainable and requires interference by this Court while sitting in the appeal 2. If so, whether there is any joint and several liability of all the three respondents or only respondents 1 and 2 by exonerating 3rd respondent either based on any general principles of law or factual matrix of the case for this Court while sitting in appeal against the award 3. Whether the quantum of compensation awarded by the Tribunal including rate of interest are high and requires interference and if so to what extent and with what observations 4. To what result\ POINTS-1 TO3 7. As the points 1 to 3 are interrelated and to avoid repetition of facts and discussion, these are taken up together for convenient disposal. The fact that the deceased Nageswara Rao (husband and father of claimants 1 to 4 (all majors) respectively) aged about 45 years died in the motor accident dated 29.06.2008, due to rash and negligent driving of the driver and conductor of the bus from not closing the doors and moving the bus while deceased was getting down from which he fell down, sustained injuries and succumbed on that day i.e., 29.06.2008 while under treatment at Government hospital, Kothagudem are proved from the material on record and no way requires interference in the appeal.
8. Before coming to the dispute on fixation of liability on the 3rd respondent-APSRTC and not fixing the liability jointly on the owner and insurer of the hired bus and the quantum of compensation whether excessive and what is just compensation in the factual matrix of the case concerned, it is apt to state that perfect compensation is hardly possible and money cannot renew a physique or frame that has been battered and shattered, nor relieve from a pain suffered as stated by Lord Morris. In Ward v. James3, it was observed by Lord Denning that award of damages in personal injury cases is basically a conventional figure derived from experience and from awards in comparable cases. Thus, in a case involving loss of limb or its permanent inability or impairment, it is difficult to say with precise certainty as to what composition would be adequate to sufferer. The reason is that the loss of a human limb or its permanent impairment cannot be measured or converted in terms of money. The object is to mitigate hardship that has been caused to the victim or his or her legal representatives due to sudden demise. Compensation awarded should not be inadequate and neither be unreasonable, excessive nor deficient. There can be no exact uniform rule in measuring the value of human life or limb or sufferance and the measure of damage cannot be arrived at, by precise mathematical calculation, but amount recoverable depends on facts and circumstances of each case. Upjohn LJ in Charle red House Credit v. Tolly4 remarked that the assessment of damages has never been an exact science and it is essentially practical. Lord Morris in Parry v. Cleaver5 observed that to compensate in money for pain and for physical consequences is invariably difficult without some guess work but no other process can be devised than that of making a monitory assessment though it is impossible to equate the money with the human sufferings or personal deprivations. The Apex Court in R.D.Hattangadi v. Pest Control (India) Private Limited6 at paragraph No.12 held that in its very nature whatever a Tribunal or a Court is to fix the amount of compensation in cases of accident, it involves some guess work, some hypothetical consideration, some amount of sympathy linked with the nature of the disability caused. But all the aforesaid elements have to be viewed with objective standard. Thus, in most of the cases involving Motor Accidents, by looking at the totality of the circumstances, an inference may have to be drawn and a guess work has to be made even regarding compensation in case of death, for loss of dependent and estate to all claimants; care, guidance, love and affection especially of the minor children, consortium to the spouse, expenditure incurred in transport and funerals etc., and in case of injured from the nature of injuries, pain and sufferance, loss of earnings particularly for any disability and also probable expenditure that has to be incurred from nature of injuries sustained and nature of treatment required.
9. From the above legal position and coming to the factual matrix, the age of the deceased was between 46 to 50, the Tribunal adopted the multiplier as 13, by following the Honourable Apex Court's expression in Sarla Varma v. Delhi Transport Corporation7. The earnings of the deceased estimated by the Tribunal at Rs.3,000/- per month. The same also sustainable as in Latha Wadhwa vs. State of Bihar8 the Honourable Apex Court held that even in the case of non-earning member and domestic contribution of a house-wife can be assessed at Rs.3,000/- per month. Therefrom, the Tribunal arrived after 1/3rd deducted towards the personal expenses of the deceased from the fact that the claimants 2 and 4 are major sons there is nothing to interfere and it therefrom comes to Rs.3,12,000/- . In addition to that the claimants are entitled to loss of consortium of Rs.1,00,000/- to the 1st claimant, funereal expenses of Rs.25,000/- and loss of estate minimum of Rs.5,000/- as per Rajesh v. Ranabir Singh9, which comes to Rs.4,42,000/-. As such, the quantum of compensation awarded by the Tribunal of Rs.3,29,000/- at 7.5% p.a. is no way on high side but for to say a low amount. As no cross-objections filed by the claimants muchless any independent appeal, since there is a bar on the power of the Court even to exercise any power under Order XLI, Rule 33 C.P.C to enhance the quantum from what is laid down in Ranjan Prakash V. Divisional Manager10 that in the appeal filed by the driver or owner or insurer, in the absence of cross-objections by the claimants they have no right and Court also has no power to enhance the compensation, but for to support the quantum on one ground or the other.
10. Now, coming to the liability, the 1st respondent is the owner of the private bus bearing bus No.AP16TS5255which was hired with the 3rd respondent-APSRTC and the insurance covered by Ex.B-1 policy with the claim petition-2nd respondent. The 3rd respondent-APSRTC no doubt exercising control over the bus including on the driver of the bus by engaging its own conductor under the contract of hire. The quantum is whether that by itself exonerates the real owner and the insurer though APSRTC is a limited owner for the purpose that so long as contract of hire in force and given full control of the bus if it is with or without knowledge of the insurer of the vehicle insured by the owner and not by APSRTC.
11. In this regard the The Apex Court in Uttar Pradesh State Road Transport Corporation (1 supra) by referring to Section 146 to 149, 157 read with Section 2(3) and Section 103 of the M.V.Act, 1988 regarding the third party risk from the statutory insurance on the scope and meaning of who is owner of a hired vehicle when the policy taken out by lesser and transferred the vehicle to the lessee covered by terms of lease held that ".The liability to pay compensation is based on a statutory provision. Compulsory insurance of the vehicle is meant for the benefit of third parties. The liability of the owner to have compulsory insurance is only in regard to the third party and not to the property. Once the vehicle is insured, the owner as well as any other person can use the vehicle with the consent of the owner. Section 146 of the Act does not provide that any person who uses the vehicle independently, a separate insurance policy should be taken. The purpose of compulsory insurance in the Act has been enacted with an object to advance social justice. Third party rights have been considered by this Court and several expressions and the law on the said point is now fairly well settled.". 11(a). The Apex Court in Guru Govekar V. Filomena F.Lobo11(1988 SC1332 held that ".Thus if a policy is taken in respect of a motor vehicle from an insurer in compliance with the requirements of chapter VII of the Act, the insurer is under an obligation to pay the compensation payable to a third party on account of any injury to his/her person or property or payable to the legal representatives of the third party in case of death of the third party caused by or arising out of the use of the vehicle at a public place. The liability to pay compensation in respect of death of or injury caused to the person or property of a third party undoubtedly arises when such injury is caused when the insured is using the vehicle in a public place. It is also arises when the insured has caused or allowed any other person (including an independent contractor) to use his vehicle in a public place and the death of or injury to the person or property of a third party is caused on account of the use of the said vehicle during such period, unless such other person has himself taken out a policy of insurance to cover the liability arising out of such an accident. This meant that once the insurer had issued a certificate of insurance in accordance with sub-section (4) of Section 95 of the Act the insurer had to satisfy any decree which a person receiving injuries from the use of the vehicle insured had obtained against any person insured by the policy. He was liable to satisfy the decree when he had been served with a notice under sub-section (2) of Section 96 of the Act about the proceedings in which the judgment was delivered. Any other view will expose innocent third parties to go without compensation when they suffer injury on account of such motor accidents and will defeat the very object of introducing the necessity for taking out insurance policy under the Act. In a recent judgment of this Court, in United India Insurance Co. Ltd., V. Santro Devi ((2009)1SCC558 it has been held as under: The provisions of compulsory insurance have been framed to advance a social object. It is in a way part of the social justice doctrine. When a certificate of insurance is issued, in law, the insurance company is bound to reimburse the owner. There cannot be any doubt whatsoever that a contract of insurance must fulfil the statutory requirements of formation of a valid contract but in case of a third-party risk, the question has to be considered from a different angle. Section 146 provides for statutory insurance. An insurance is mandatorily required to be obtained by the person in charge of or in possession of the vehicle. There is no provision in the Motor Vehicles Act that unless the name(s) of the heirs of the owner of a vehicle is/are substituted on the certificate of insurance or in the certificate of registration in place of the original owner (since deceased), the motor vehicle cannot be allowed to be used in apublic place. Thus, in a case where the owner of a motor vehicle has expired, although there does not exist any statutory interdict for the person in possession of the vehicle to ply the same on road; but there being a statutory injunction that the same cannot be plied unless a policy of insurance is obtained, we are of the opinion that the contract of insurance would be inforceable. It would be so in a case of this nature as for the purpose of renewal of insurance policy only the premium is to be paid. It is not in dispute that quantum of premium paid for renewal of the policy is in terms of the provisions of the Insurance Act, 1938. Perusal of the ratio of aforesaid judgments of this Court shows that Section 146 of the Act gives complete protection to the third party in respect of death or bodily injury or damage to the property while using the vehicle in public place. For that purpose, insurance of the vehicle has been made compulsory to the vehicles or to the owners. This would further reflect that compulsory insurance is obviously for the benefit of third parties. Certificate of insurance between the owner and the insurance company contemplates under what circumstances the insurance company would be liable to pay the amount of compensation. The relevant conditions are reproduced hereinbelow: ".Rules with respect to use of the vehicle Use only for carriage of passengers in accordance with permit (contract carriage or stage carriage) issued within the meaning of the Motor Vehicles Act, 1988. This policy does not cover:
1. Use for organized racing, pace making, reliability trial, speed testing.
2. Use whilst drawing a trailer except the towing (other than to reward) of any one disabled mechanically propeller (sic propelled) vehicle. Persons who are qualified to use the vehicle: Any person including the insured provided that the person driving holds an effective driving licence at the time of the accident and is not disqualified from holding or obtaining such licence. Provided also that a person holding an effective learner's licence may also drive the vehicle when not used for transport of passengers at the time of the accident and such a person satisfies the requirement of Rule 3 of the Central Motor Vehicle Rules, 1989. Perusal thereof would show that there has not been any violation of the aforesaid terms and conditions of the policy. The respondent Insurance Company has also failed to point out violation of any Act, Rules or conditions of insurance. The Insurance Company has no legal justification to deny the payment of compensation to the claimants. In the light of the foregoing discussions, the appeal filed by the Insurance Company fails, wherein it has been directed that the amount would first be paid by the Company, with right to it to recover the same from the owner of the vehicle. This we hold so as the liability of the Insurance Company is exclusive and absolute. Thus, looking to the matter from every angle, we are of the considered opinion that the Insurance Company cannot escape its liability of payment of compensation to third parties or claimants. Admittedly, owner of the vehicle has not violated any of the terms and conditions of the policy or provisions of the Act. The owner had taken the insurance so as to meet such type of liability which may arise on account of use of the vehicle. Apart from the above, the learned counsel for the Insurance Company could not point out any legal embargo which may give right to it to deny the payment of compensation. Thus, legally or otherwise, liability has to be fastened on the Insurance Company only.". 11(b). From this expression it is also necessary to discuss the relevant portions ".A critical examination thereof would show that the appellant and the owner had specifically agreed that the vehicle will be insured and a driver would be provided by owner of the vehicle but overall control, along with the driver would be that of the APSRTC. Thus, the vehicle was given on hire by owner of the vehicle together with existing and running insurance policy in view of the aforesaid terms and conditions, the insurance company cannot escape its liability to pay the amount of compensation. On account of the aforesaid discussions, it is crystal clear that actual possession of the vehicle was with the Corporation. The vehicle, driver and the conductor were under the direct control and supervision of the Corporation. Black's Law Dictionary defines ".vicarious liability". as follows: ".Liability that a supervisory party (such as an employer) bears for the actionable conduct of a subordinate or associate (such as an employee) because of the relationship between the two parties.". So, through the above definition, it can be inferred that the person supervising the driver through the principle of respondent superior should pay for the damages of the victim.".
12. From the above, for all practical purposes, for the relevant period, the APSRTC had become the owner of the vehicle during the specific hire period. If the Corporation had become the owner even for the specific period and for the limited purpose the vehicle having been insured at the instance of original owner, it will be deemed that the vehicle was transferred along with the insurance policy in existence to the Corporation and thus the Insurance Company would not be able to escape its liability to pay the amount of compensation. So, through the definition of vicarious liability it can be inferred that the person supervising the vehicle through the principal-respondeat superior to pay the damages to the victim-third party, when it is not the case of the insurer that driver was not holding a valid licence to drive the vehicle at the time of accident. It has not also been contended that there is any violation of terms and conditions of the policy from saying driver was not entitled to drive the vehicle. The insured admittedly received the premium for the period at the time that bus had met with accident and the bus being plied by APSRTC. When there is no statutory duty cast on the owner under the Act or the Rules to seek permission or to give intimation to insurer in case of vehicle hired with APSRTC for it is being plied to say any violation, the insurer cannot escape the liability muchless any legal justification to deny the payment of compensation to the third party claimants. It is because the liability of the insurance company is exclusive and absolute.
13. Apart from the above expression in the Full Bench judgment of this Court in LPA No.206 of 2000, dated 20.11.2012 between A.P.S.R.T.C. V. B.Kanakaratnabai and others12 it was held that ".The only question that arises for consideration is as to whether the compensation payable in respect of third party claims arising out of accident, involving insured vehicle hired by the APSRTC, should be borne by the owner of the vehicle or by the insurance company or by the APSRTC or by some or all of them A similar question as to whether the compensation payable in respect of the claims arising out of accident involving insured but hired by the APSRTC should be borne by the owner of the vehicle or by the Insurance Company or by the APSRTC or by some or all of them was referred to a Full Bench of this Court and the Full Bench in L.P.A. No.206 of 2000 and batch vide common judgment, dated 20.11.2012 held that mere hiring of insured buses by the owners to the APSRTC would not in any manner limit the liability and accountability of the insurance companies, be it under the Act of 1988 or the Act of 1939, to honour passengers/third party risks covered by the Insurance policies issued by them in favour of the owners and notwithstanding the hiring of insured buses by the owner to the APSRTC, the Insurance Company shall be solely and exclusively liable for payment of the compensation arising out of such passengers/third party claims unless any of the grounds in Section 149(2) of the Act of 1988/Section 96(2) of the Act of 1939 are made out. Therefore, we are of the opinion that the issue raised in this appeal by the APSRTC is squarely covered by the Full Bench judgment of this Court. Having regard to the facts and circumstances of the case, the appeal is allowed setting aside the order dated 22.03.2010 passed in O.P.No.904 of 2008 by the Tribunal, in so far as dismissing the same as against the owner and insurance company. The 8th respondent-insurance company is directed to honour the claim of respondents 1 to 6 herein as ordered by the Tribunal notwithstanding hiring of the said vehicle by the owner in favour of the APSRTC, as it is solely and exclusively liable to pay compensation arising out of the third party claims.".
14. The above propositions of law thus crystallizes the issue on hand to the conclusion that even the APSRTC, for the limited purpose during the agreement of hire in force, having control over the bus as well as the driver that belongs to the owner by engaging its own conductor in plying the bus got control over it to a limited extent as owner, the real owner is always the original person who hired the bus and owned the bus registered in his name and once the insurance company insured the vehicle by impugning for its hiring, insurer cannot escape the liability muchless fastened the liability solely on the APSRTC. As the bus was taken on hire for plying by the APSRTC and from above expression of the Honourable Apex Court, no doubt there is something left open to say that if there is any violation of the policy terms and conditions saying that the driver of the bus was not having valid driving licence at the time of accident; whether the insurance company is liable to be exonerated and if so, the real owner or the APSRTC limited owner can alone or both together subject to any direction to the insurer to pay and recover from real owner to be given in the present case that aspect also does not arise to answer but for to say among the respondents 1 to 3 i.e., real owner and the insurer of the bus which hired to APSRTC are jointly liable and not the APSRTC. From the above it is though not necessary but for the purpose to clear the cloud to observe that even if there is any violation from the driver engaged by the real owner from any conscious knowledge of not having effective driving licence to make him liable but for the real owner and not the APSRTC as limited owner, to be made liable to pay and recover if at all the insurer was made liable to pay to recover by execution of the award only against the real owner and not against the APSRTC who is not the real owner. Accordingly the above points for consideration were answered.
15. In the result, the appeal is allowed while confirming the quantum of compensation of Rs.3,29,000/- with 7.5% interest awarded by the Tribunal in favour of the claimants, however by modifying the finding of the Tribunal in fixing liability only against the 3rd respondent-APSRTC (appellant herein) to the joint liability by directing the 2nd respondent-insurer of the vehicle to satisfy the claim by payment or deposit of compensation amount (indemnifying the real owner-insured) within one month from today, failing which the claimants can execute and recover to the credit of the O.P before the Tribunal. It is subject to that the A.P.S.R.T.C. is permitted to withdraw the amount already made in deposit. On other aspects, the finding of the Tribunal regarding apportionment and withdrawal holds good. There is no order as to costs. ______________________ Dr.B.SIVA SANKARA RAO, J Date:02-01-2014