Kulbhushan Singhal and ors. Vs. Gyan Singh and ors. - Court Judgment

S.H. Kapadia, C.J.

1. Being aggrieved by the award dated 6.5.1995 passed by the Motor Accident Claims Tribunal/Third Additional District Judge, Nainital, in M.A.C.T. Case No. 542 of 1991, the claimants and the owner of the offending vehicle have come to this Court by way of appeals from order under Section 173 of Motor Vehicles Act, 1988.

2. Since, common question of law and fact arises for determination, all the above appeals are decided by this common judgment.

Facts:

3. Dr. Ashok Kumar Singhal and his wife Dr. Archana Singhal were on their way from Bijnore to Nainital to visit their elder son Apurva studying in 5th standard in St. Joseph School, Nainital. This was on 16.7.1991. On their way to Nainital, they were travelling in a Maruti car No. UGH 7585. At 8.40 a.m. the accident took place. At 8.40 a.m. the Maruti car collided with a private bus No. USI 5345 owned by Gyan Singh, the respondent No. 1. The offending bus was insured with National Insurance Co. Ltd. Dr. Ashok Kumar Singhal (deceased) was a Physician. He was 38 years of age. He was working as a Physician in the District Hospital, Bijnore. He was a Government servant. His monthly income was Rs. 6,400/-. Dr. Ashok Kumar Singhal (deceased) was an M.D. His age of retirement was 58 years. His wife Dr. Archana Singhal was 36 years of age on the date of accident, i.e., on 16.7.1991. She was M.S. (Gynaecology). She was working as a Medical Officer, District Women Hospital, Bijnore. Her salary was Rs. 5,585/- per month. The couple was driving in the same vehicle on 16.7.1991 when the accident took place. The couple had two minor children Apurva (age 11 years) and Aditya (age 6 years) on the date of accident. Dr. Ashok Kumar Singhal had aged parents Kulbhushan Singhal (age 67 years) and his mother Sarla Singhal (age 61 years) on 16.7.1991.

Two claim petitions were filed. Claim Petition No. 542 of 1991 was filed by Kulbhushan Singhal, Sarla Singhal, Apurva and Aditya as legal representatives of Dr. Ashok Kumar Singhal for grant of compensation on account of the demise of Dr. Ashok Kumar Singhal. Claim Petition No. 542 of 1991 was also filed by 'Apurva and Aditya for compensation as legal representatives of Dr. Archana Singhal. Both these claim petitions have been disposed of by two separate judgments dated 6.5.1995 under common Claim Petition No. 542 of 1991 by Motor Accident Claims Tribunal (hereinafter referred to for the sake of brevity as 'the Tribunal')- In the petition filed by Kulbhushan Singhal and others as legal representatives of their son Dr. Ashok Kumar Singhal, Claims Tribunal awarded compensation amounting to Rs. 4,50,000/- against Gyan Singh (owner of the bus), whose driver was held guilty of rash and negligent driving. On the other hand, in the claim petition filed by Apurva and Aditya as legal representatives of their mother Dr. Archana Singhal, Rs. 4,00,000/- was awarded against Gyan Singh as compensation. In both the cases the Tribunal took the view that the, accident took place due to rash and negligent driving by the driver of the bus owned by Gyan Singh. In both the cases the Tribunal took the view that the claimants had failed to prove that on the date of the accident, i.e., 16.7.1991, the bus stood insured with National Insurance Co. Ltd., Haldwani, Distt. Nainital. Therefore, two decrees were passed against the owner, Gyan Singh. Being aggrieved by the above two awards given by the Claims Tribunal, two appeals (A.O. Nos. 1101 and 1101-A of 2001) have been preferred under Section 173 of Motor Vehicles Act by the claimants. Since, the decree was passed against Gyan Singh (owner of the bus) only and not against National Insurance Co. Ltd. (hereinafter referred to as 'the insurer'), Gyan Singh has also preferred two separate appeals against two separate awards vide A.O. Nos. 290 and 291 of 2003. National Insurance Co. Ltd. has also filed its cross-objections before this Court.

Arguments:

4. In this case, the Claims Tribunal has held that no evidence has been adduced by the claimants to show that the defaulting bus stood insured with National Insurance Co. Ltd., Haldwani, Distt. Nainital on 16.7.1991. This finding has been attacked by the claimants. In this connection, Mr. A. Rab, learned Counsel for the claimants, contended that the Motor Vehicles Act, 1988 is a welfare legislation. That the Act has been enacted to award compensation. It was argued that during the pendency of the trial, the claimants had given notice to National Insurance Co. Ltd. to produce all relevant documents before the Court. That despite the notice, the insurance policy cover was not produced. That the burden was on National Insurance Co. Ltd. to file the documents before the Tribunal and in the absence of National Insurance Co. Ltd. not filing the documents, adverse inference should have been drawn against the insurer. In this connection, reliance was placed on the judgment of the Apex Court in the case of Gopal Krishna Katkar v. Mohd. Latif MANU/SC/0168/1969 : [1968]3SCR862 . Reliance was also placed on the judgment of the Apex Court in the case of National Insurance Company Ltd. v. Jugal Kishore II (1988) ACC 327 (SC) : 988 ACJ 270 (SC). In the said judgment, it has been held that the documents which help in doing justice must be produced before the Court by the party in possession and more so, when that party is a Government or instrumentality of the Government. Mr. A. Rab contended that the claimant Kulbhushan Singhal is today 81 years old and the matter should not be remitted r back to the lower Court because it would further prolong and delay the matter. It was argued that the burden to produce the insurance cover was on the insurer. Mr. A. Rab next contended that this appeal has been filed by the claimants for enhancement of compensation. He contended that the Tribunal erred in deducting 50 percent of the estimated gross income of Dr. Ashok Kumar Singhal on account of personal expenses, whereas in numerous judgments of the Apex Court, it has been held that for want of evidence, 1/3rd of the gross income should be attributed to personal expense of the deceased. Mr. A. Rab further contended on behalf of claimants that in the case of the claim made by the legal representatives of Dr. Ashok Kumar Singhal, the multiplier of 10 was erroneous. He contended that the Tribunal should have applied the multiplier of 16 and, therefore, the quantum of compensation awarded by the Tribunal is underestimated. It was next contended that the Tribunal erred in coming to the conclusion that the minors would have been dependent on their parents up to the age of 22. It was argued that both the deceased were doctors. It was argued that their children were likely to take up the profession of their deceased parents who were both M.D. and M.S. respectively and, therefore, the dependency of the minors on their parents would have been up to the age of 27. That the evidence on record further shows that family members had lived beyond 80 and, therefore, the multiplier of 16 would have been appropriate. According to the learned Counsel the above facts have not been taken into account by the Tribunal.

Mr. Sudhir Kumar, learned Advocate for Gyan Singh (appellant in A.O. Nos. 290 and 291 of 2003) argued that the Tribunal had erred in passing a decree against the owner and not against the Insurance Company. It was argued that an F.I.R. bearing Crime No. 142 of 1991 was lodged against the driver of the bus at the Police Station, Kala Dhungi. That the Additional Judicial Magistrate, Haldwani, had, subsequently, released the bus on 20.7.1991 on production of Permit No. 284 (K), Registration Certificate No. US 5345, Insurance Policy Cover No. 59502 and Driving Licence No. DLN-B-172-RPR-90 which indicates that offending bus was insured with National Insurance Co. Ltd. and in the circumstances, the Tribunal erred in passing the decree against the owner and not against the insurer.

Mr. D.S. Patni, learned Advocate for National Insurance Co. Ltd., Haldwani, Distt. Nainital, contended that in absence of insurance cover, the insurer cannot be held liable. He argued that the burden was on the claimant to prove that the bus was insured with National Insurance Co. Ltd. He contended that even the photocopy of the cover indicated that the policy had lapsed on the date of the accident. He further contended that the driving licence was also not produced. He, therefore, contended that the decree has been rightly passed against the owner of the offending bus. At this stage, it may be mentioned that when the matter came for hearing before this Court on 30.9.2003, the insurance cover was produced. On the same date, driving licence was also produced. However, Mr. Patni, learned Advocate for the insurer argued that the driving licence could be fake. He sought time to verify the genuineness of the driving licence. He submitted that if the licence was fake, then the insurer had a right to recover the compensation from the owner. Mr. Patni next argued that in this case Kulbhushan Singhal was 67 years old and his wife Sarla Singhal was 61 years of age and, therefore, the multiplier of 10 has been correctly applied by the Tribunal and no inference is called for on the question of quantum of compensation awarded by the Tribunal. He contended that looking to the age of Kulbhushan Singhal and his wife, the multiplier of 10 has been correctly applied in this case. He contended that Second Schedule of the Motor Vehicles Act was a guiding factor in order to decide the multiplier.

Issues:

(1) Whether National Insurance Co. Ltd. was right in avoiding its liability under the Act for non-production of insurance cover by the claimants?

(2) Whether the quantum of compensation awarded by the Tribunal requires upward revision by this Court in the appeals filed by the claimants?

Our Answer:

6. In view of the production of the insurance cover and the driving licence before us by the parties, we need not answer the issue No. 1. The question as to whether the Tribunal erred in placing the burden of proof on the claimants need not be answered as relevant documents have now been produced before us. We are not inclined to remit the matter to the Tribunal as Kulbhushan Singhal, today, is 81 years old. We have, ourselves, gone into the factual matrix of the case in order to decide the multiplicand and also to decide the multiplier so that 'just' compensation can be awarded to the claimants. However, one point needs to be mentioned. It has been argued on behalf of the Insurance Company that the driving licence produced could be fake and in such a case the insurer should be given permission to recover the compensation from the owner. In the case of United India Insurance Co. Ltd. v. Lehru MANU/SC/0219/2003 : [2003]2SCR495 , it has been held by the Apex Court that where prior to hiring the driver, the owner satisfies himself that the driver had a licence and that he was driving the vehicle competently, there would be no breach of Section 149(2)(a)(ii) and in such a case, the insurer would be liable. That, if ultimately, the driving licence is found to be fake, the insurer would continue to be liable unless the insurer proves that the owner-insured was aware of the fact that the driving licence was fake and even in such a case the insurer would remain liable to the innocent third party claimant, but the insurer would be entitled to recover the amount from the insured. In this case, there is nothing to indicate that the driving licence produced was fake. In this case, as stated above, the Additional Judicial Magistrate, Haldwani had released the vehicle on production of the driving licence. No such plea has been taken in the written statement filed by National Insurance Co. Ltd. before the Tribunal. In fact, this Court had adjourned the matter to enable the insurer to verify the genuineness of the driving licence. In the circumstances, it is not open to National Insurance Co. Ltd. to avoid its liability under the Act. In the circumstances, without going into the question of burden of proof, we hold that the liability to pay compensation was that of the Insurance Company and finding to the contrary is set aside. Accordingly, we answer Issue No. 1 in favour of the claimants and the owner and against the insurer.

Now coming to the question of quantum of compensation in this case, we are of the view that the compensation awarded by the Tribunal has been underestimated. Dr. Ashok Kumar Singhal was 38 years old on 16.7.1991. He was M.D. His salary was rightly estimated at Rs. 9,000/- per month by the Claims Tribunal. There is no need to disturb that finding. However, the Tribunal erred in deducting Rs. 4,500/- from his monthly estimated salary on account of his personal expenses and thereby reducing the value of loss of dependency. The deceased had two minor children. He had two aged parents. Under the circumstances, 1/3rd of his estimated monthly salary was sufficient to meet his personal expenses. The deceased was a doctor and working in a Government Hospital and 1/3rd of his estimated salary of Rs. 9,000/- per month amounting to Rs. 3,000/- was sufficient to meet his personal expenses in Bijnore, where the standard of living was relatively lower than Lucknow or Allahabad. We are, therefore, of the view that the Tribunal erred in deducting 50 percent of Rs. 9,000/ - towards personal expenses of Dr. Ashok Kumar Singhal (since deceased). Similarly, the Tribunal rightly estimated gross monthly salary of Dr. Archana Singhal at Rs. 8,000/-, but it erred in deducting 50 percent of her estimated salary for personal expenses and thereby, reducing the value of the loss of dependency. For the same reasons given hereinabove, we are of the view that even in the case of Dr. Archana Singhal, the Tribunal should have allowed deduction of 1/3rd from the estimated gross monthly salary of Rs. 8,000/- towards her personal expenses as she was also working in a Government Hospital at Bijnore. The present case is squarely covered by the judgment of the Supreme Court in the case of General Manager, Kerala State Road Trans. Corporation v. Susamma Thomas MANU/SC/0389/1994 : AIR1994SC1631 . In that case, the facts were as follows: The claimants were the parents and children of the deceased aged 38 years. The accident took place on 19.2.1984. The accident was the result of actionable negligence on the part of the driver of the bus. At the time of his death, the deceased was employed in a newspaper establishment on monthly salary of Rs. 1,032/-. The Tribunal determined the compensation payable to the parents and children of the deceased at Rs. 58,760/-. On appeal, the High Court increased the compensation to Rs. 2,64,000/-. Kerala State Road Transport Corporation came in appeal to the Supreme Court. It was held by the Apex Court that the multiplier method was applicable to the case. That under the multiplier method one has to ascertain the loss of dependency. That under the multiplier method one has to capitalise the value of the loss of dependency. That the choice of the multiplier depended on the age of the deceased, age of the claimants and other factors. That the multiplier represents the number of years purchase on the basis of which the loss of dependency is capitalised. On facts, the Apex Court found that the deceased was 39 years of age when he died. His income was Rs. 1,032/-per month. In future, his salary was likely to increase. The Apex Court, having regard to his future prospects, estimated his monthly income at Rs. 2,000/-as gross income per month from which 1/3rd came to be deducted on account of personal living expenses. The balance 2/3rd was treated as the amount likely to have been spent on the members of the family and the dependants. This loss of dependency was capitalised by the Apex Court with the multiplier of 12. Accordingly, compensation was fixed at Rs. 2,03,000/- to which was added Rs. 4 15,000/- for loss of consortium. In all a sum of Rs. 2,25,000/- was awarded by the Supreme Court with interest at the rate of 12 percent per annum from the date of petition till the date of payment.

In our view, the above judgment of the Apex Court applies to the facts of the two claim petitions. As far as the claim petition filed by the legal representatives of Dr. Ashok Kumar Singhal is concerned, we are of the view that looking to the age of the parents and the age of the minors (all claimants), the multiplier of 12 would be appropriate, whereas, as regards the claim petition filed by the minors (legal representatives of Dr. Archana Singhal), the multiplier has to be 15. This is also in consonance with the judgment of the Apex Court in the case of U.P. State Road Trans. Corporation v. Trilok Chandra I (1996) ACC 592 (SC) : 1996 ACJ 831 (SC). We wish to clarify that we have two different multipliers because in the first case, the age of the parents vis-a-vis the age of the minors varies from 67 years to 6 years and, therefore, the value of the loss of dependency will be different as compared to the second case where the children of the dead mother alone are the claimants and whose dependency on the dead mother (who was also earning) was up to 27 years and, therefore, in the second case, we have applied the figure of 15 as a multiplier.

7. Accordingly, we pass the following order:

Order:

(a) Decree in favour of legal representatives of Dr. Ashok Kumar Singhal:

There shall be a decree in the sum of Rs. 8,64,000/- (Rs. 6,000/- x 12 x 12 = Rs. 8,64,000/- for loss of dependency) with interest at the rate of 10 percent per annum from the date of the petition till payment in favour of Kulbhushan Singhal and others (legal representatives of Dr. Ashok Kumar Singhal) and against National Insurance Co. Ltd., Haldwani, Distt. Nainital.

(b) Decree in favour of Apurva Singhal and another (legal representatives of the deceased Dr. Archana Singhal):

There shall be a decree in the sum of Rs. 9,72,000/- (Rs. 5,400/- x 12 x 15) with interest at the rate of 10 percent per annum from the date of the petition till payment in favour of Apurva Singhal and another (the legal representatives of Dr. Archana Singhal) and against National Insurance Co. Ltd. Haldwani Distt. Nainital.

Accordingly, the above appeals filed by the claimants and owner respectively stand disposed of in the aforestated terms. The cross-objections filed by the insurer are dismissed. No order as to costs.