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National Insurance Company Ltd. v. Baljit Kaur And Ors.
Judgment Summary — National Insurance Company Limited v. Award of Motor Accident Claims Tribunal
Factual and Procedural Background
On 3 March 2000 Tirath Ram was allegedly robbed of Rs. 2,300 while proceeding on a tractor. The robbers fled on Scooter No. PB-12-4771. Pursuers including Ranjit Singh and Jatinder Singh chased the culprits on their scooter and were joined by Lakhwinder Singh (the deceased) and Kishan Singh; the police party also joined the chase. The culprits, while being followed, purportedly turned their scooter to obstruct the scooter driven by (or carrying) Lakhwinder Singh (Scooter No. CH-01-B-3473), causing Lakhwinder Singh’s scooter to deflate, go out of control, hit a roadside Shisham tree, and result in fatal injuries. An FIR (No. 15 dated 3.3.2000) under Sections 356, 207, 279 and 304 IPC was registered.
A claim petition under Section 163-A of the Motor Vehicles Act was filed by the legal heirs/dependents of Lakhwinder Singh claiming compensation. Respondent No.1 (Lakhbir Singh) did not contest and was proceeded against ex parte; respondent No.2 contested ownership and identity issues. The National Insurance Company (insurer of Scooter No. CH-01-B-3473) contested on multiple grounds: that the driver of the scooter did not hold a valid driving licence at the time, that the claim was bad for non-joinder/mis-joinder (insurer of the pursuing scooter PB-12-4771 not impleaded), and that the petition was an attempt to claim illegal compensation. On the pleadings the Tribunal framed issues and, after trial, held that the death resulted from use of Scooter No. CH-01-B-3473, that the claimants were legal heirs and dependents, and that the deceased held a valid driving licence. The Tribunal applied Section 163-A and awarded compensation of Rs. 4,60,340/- (including funeral and other heads) against Lakhbir Singh and National Insurance Company, holding liability joint and several.
The National Insurance Company appealed against the Tribunal's award to the High Court. The High Court judgment (Vinod K. Sharma, J.) is the subject of this summary.
Legal Issues Presented
- Whether the claim petition under Section 163-A of the Motor Vehicles Act was competent/applicable in the present case where the deceased's income was shown as Rs. 10,000 per month (i.e., exceeding Rs. 40,000 per annum)?
- Whether the Tribunal was correct in treating and deciding the petition under Section 163-A (and restricting income to Rs. 40,000 for the purposes of that provision) instead of proceeding under Chapter XII/Section 166 of the Act?
Arguments of the Parties
Appellant (National Insurance Company) — Principal Arguments
- Section 163-A is a social provision with a distinct scheme and is available only to victims whose annual income is up to Rs. 40,000; persons with annual income above Rs. 40,000 must have their claims determined under Chapter XII (including Section 166) of the Act. This submission relied on the Supreme Court judgment in Deepal Girishbhai Soni v. United India Insurance Co. Ltd. (2004).
- The Tribunal could not legitimately restrict a claim under Section 166 to the Section 163-A parameters by arbitrarily treating a petition under Section 166 as one under Section 163-A (relying also on the Division Bench decision in Himachal Road Transport Corporation v. Baldev Kumar Nayyer).
- Separately at the Tribunal stage the appellant had raised preliminary objections that the driver of Scooter CH-01-B-3473 did not hold a valid driving licence and that there was non-joinder/mis-joinder of necessary parties (insurer of the other scooter), although the High Court appeal focused on the competence to invoke Section 163-A.
Respondents / Claimants — Principal Contentions as Recorded
- The claimants pleaded that the deceased, Lakhwinder Singh, was aged 32, employed as a labourer at Food Corporation of India and involved in agriculture/dairy, earning Rs. 10,000 per month; they claimed dependency and sought compensation for loss of dependency and other heads under the Tribunal's application of Section 163-A.
- The Tribunal, relying on a Single Judge judgment in National Insurance Co. Ltd. v. Indu Sharma (2000), held that Section 163-A did not indicate that it applied only where annual income was within Rs. 40,000, and thus awarded compensation under Section 163-A.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Deepal Girishbhai Soni v. United India Insurance Co. Ltd., Baroda, 2004 (2) RCR (Civil) 466 (SC) : (2004-2) 137 PLR 271 | Held that Section 163-A is a social security provision available only to those whose annual income is up to Rs. 40,000; compensation under Sections 163-A and 166 are final and independent and a remedy under both cannot be pursued simultaneously. | The High Court relied on this Supreme Court precedent to hold that the petition under Section 163-A was not competent in the present case because the deceased's annual income exceeded Rs. 40,000. |
| Himachal Road Transport Corporation v. Baldev Kumar Nayyer, 2006 (2) RCR (Civil) 682 (P&H) : (2006-2) 143 PLR 75 | Division Bench authority holding that a Tribunal cannot treat a petition filed under Section 166 as one under Section 163-A by restricting income to Rs. 40,000; it set aside an award under Section 163-A and remanded for decision under Section 166 in accordance with Deepal Soni. | The High Court treated this Division Bench decision as confirmatory of the principle that Section 163-A cannot be applied where annual income exceeds Rs. 40,000 and that the Tribunal's action was not permissible. |
| National Insurance Co. Ltd. v. Indu Sharma, 2000 (2) RCR (Civil) 186 (P&H) : (2000-1) 124 P.L.R 417 | Single Judge decision interpreted Section 163-A as not being limited to victims with annual income up to Rs. 40,000, and read the II Schedule as providing multipliers and heads of compensation without such a cap. | The Tribunal had relied on this Single Judge decision to apply Section 163-A despite the deceased's higher income; the High Court considered this but found that subsequent Supreme Court authority (Deepal Soni) and Division Bench precedent undermined the Single Judge's holding. |
| Kodala (citation: (2001-2) 128 P.L.R 663 (S.C), as discussed in Deepal Soni) | Referenced in Deepal Soni; the Supreme Court observed that Kodala was correctly decided but disagreed with the proposition that invoking Section 163-A would treat Rs. 40,000 as a cap for all purposes. | The High Court noted the Supreme Court's commentary on Kodala in Deepal Soni when explaining why the Single Judge view in Indu Sharma could not be treated as good law in face of Deepal Soni. |
Court's Reasoning and Analysis
The High Court began by identifying the Tribunal's reliance on the Single Judge decision in Indu Sharma, which had interpreted Section 163-A as not being restricted to victims with annual income up to Rs. 40,000. The Tribunal awarded compensation under Section 163-A after treating the deceased's income as Rs. 40,000 for the purposes of the Schedule and applying the appropriate multiplier.
The High Court then examined higher authority. It noted that the Supreme Court in Deepal Girishbhai Soni had held that Section 163-A is a distinct social-security provision and is available only to victims whose annual income is up to Rs. 40,000. The Supreme Court further held that proceedings under Sections 163-A and 166 are final and independent, and a claimant cannot pursue both remedies simultaneously.
The High Court also relied on a Division Bench decision of this Court (Himachal Road Transport Corporation v. Baldev Kumar Nayyer) which, reading Deepal Soni, held that a Tribunal cannot treat a petition under Section 166 as one under Section 163-A by restricting the income to Rs. 40,000; that Division Bench had set aside an award under Section 163-A and remanded the matter for determination under Section 166.
Applying the above authorities to the facts, the High Court observed that the deceased's income was shown at Rs. 10,000 per month (i.e., substantially more than Rs. 40,000 per annum). In those circumstances, invoking Section 163-A was not permissible. The High Court explicitly noted that it had not been shown whether any application under Section 166 had also been filed, and therefore made no adjudication on that point.
In short: because the deceased's annual income exceeded Rs. 40,000, the High Court concluded that the Tribunal erred in applying Section 163-A and awarding compensation under that provision.
Holding and Implications
HOLDING: The appeal is allowed. The High Court set aside the award of the learned Motor Accident Claims Tribunal by holding that the application under Section 163-A of the Motor Vehicles Act was not competent in the present case.
Implications:
- The direct effect is that the Tribunal's award under Section 163-A (award of Rs. 4,60,340/- and costs) is set aside as the petition was not maintainable under Section 163-A given the deceased's shown income of Rs. 10,000 per month.
- The High Court did not determine or remand the matter for decision under Section 166 because it was not shown whether any petition under Section 166 had been filed; the Court expressly declined to comment further on that aspect.
- The decision follows binding Supreme Court authority (Deepal Girishbhai Soni) and a Division Bench decision of this Court; the High Court did not purport to lay down new law but applied existing higher-court rulings to set aside the Tribunal's award.
Appeal allowed.
This summary is based exclusively on the text of the provided opinion and does not add or infer information beyond that opinion.
Vinod K. Sharma, J.:— This appeal has been filed by the National Insurance Company Limited against the award passed by the learned Motor Accident Claims Tribunal, Rup Nagar (for short the Tribunal) under Section 163-A of the Motor Vehicles Act.
2. The brief facts of the case as brought out in the claim petition are that on 3.3.2000 some unknown person snatched an amount of Rs. 2,300/- from one Tirath Ram, while he was proceeding on Tractor No. PB-12-B-1813 from Chamkaur Sahib to his village Bassi Gujaran. The culprits after snatching the amount slipped away on Scooter No. PB-12-4771 and on alarm being raised Ranjit Singh and jatinder Singh stopped their scooter and thereupon Tirath Ram narrated the incident of snatching. The said persons took Tirath Ram on the pillion of their scooter and started following the unknown culprits. Lakhwinder Singh deceased and Kishan Singh met them on the way and the whole incident was narrated to them also. Kishan Singh and Lakhwinder Singh also joined them in following the culprits and the police party of Bela Chowk also joined them in search of the culprits by making efforts to stop scooter No. PB-12-4771. Said culprits took a turn towards Behrampur and when they reached in the area of village Wajidpur, they intentionally turned their scooter with an intention to obstruct the scooter of Lakhwinder Singh bearing Registration No. CH-01-B-3473 to dissuade him and it was on account of wrong driving of the culprits that the scooter of Lakhwinder Singh got deflated and became out of control which struck against a Shisham tree planted by the road side and resultantly, he received multiple injuries and finally succumbed to his injuries. The accident, thus, was the result of use of scooter No. CH-01-B-3473 when the culprits tried to dissuade him from following them. It was pleaded that due to the wrong driving of the culprits the accident had taken place. F.I.R No. 15 dated 3.3.2000 under Sections 356, 207, 279 and 304 I.P.C was registered in Police Station Chamkaur Sahib. The deceased at the time of his death was 32 years of age and was employed in Food Corporation of India as labourer at Chamkaur Sahib and was also carrying on his agricultural work and dairy farm. It was the case of the claimants that they were entirely dependent on the income of deceased Lakhwinder Singh and due to the sudden termination of his life in the said accident, they suffered huge mental, financial and social loss. The said scooter was owned by respondents No. 1 and 2 and the same was insured with National Insurance Company Ltd., respondent No. 3. The parents of Lakhwinder Singh i.e Sadhu Singh and Lakshmi Kaur were joined as proforma respondents. On these pleadings petition for compensation was filed.
3. Lakhbir Singh, respondent No. 1 did not contest the claim, who was proceeded ex parte, whereas the claim was contested by respondent No. 2 pleading that Lakhbir Singh was the owner of the scooter in question and Ranjit Singh had nothing to do with the same. The National Insurance Company separately contested the claim petition by taking preliminary objection that the claim petition against the insurance Company was not maintainable as the driver of Scooter No. CH-01-3473 was not holding a valid and effective driving licence issued by the competent authority at the time of the accident. It was also pleaded that the claim petition was bad for non-joinder and mis-joinder of necessary parties as insurer of Scooter No. PB-12-4771 had not been impleaded as party. However, on merit it was admitted that Scooter No. CH-Ol-B-3473 was insured with the answering respondent. It was denied that any accident took place with Scooter No. CH-01-B-3473. It was also the case of the Insurance Company that the claim petition has been filed to claim illegal compensation.
4. Respondents No. 4 and 5 supported the case of the claimants and prayed for the grant of compensation to them also.
5. On the pleadings of the parties the learned Tribunal was pleased to frame the following issues:—
1. Whether death of Lakhwinder Singh took place on 3.3.2000 in the area of village Wazidpur out of the use of Scooter No. CH-01-B-3473? OPP
2. Whether the claimants are the only legal representatives and dependents on the deceased? OPP
3. Whether deceased Lakhwinder Singh was not holding a valid driving licence, at the time of accident? OPR
4. Whether the claim petition is bad for non-joinder and mis-joinder of necessary parties? OPR
4-A. Whether Scooter No. CH-01-B-3473, was being driven in violation of the terms and conditions of the insurance policy? OPR
5. Whether the claimants, are entitled to claim compensation? If so, to what amount and from whom? OPP
6. Relief.
6. Issues No. 1, 2 and 3 were taken up together and it was held by the learned Tribunal that death of Lakhwinder Singh took place out of use of Scooter No CH-01-B-3473 and the claimants along with Sadhu Singh and Lakshmi Kaur were held to be the legal heirs of the deceased. It was also held that Lakhwinder Singh held a valid driving licence at the time of the accident. Issue No. 4 was also decided against the respondent Insurance Company and it was held that the claim petition was not bad for mis-joinder and non-joinder of necessary parties. On Issue No. 4-A, it was held that the scooter was not being driven for organizing racing. Rather, Lakhwinder Singh was helping, the other persons for chasing the culprits and naturally issue No. 4-A was also decided against the respondents. On Issue No. 5, the learned Tribunal noticed that at the time of accident the deceased was earning Rs. 10,000/- per month and no evidence was led in rebuttal and by relying upon a judgment of this Court reported as National Insurance Co. Ltd. v. Indu Sharma, 2000 (2) RCR (Civil) 186 (P&H) : (2000-1) 124 P.L.R 417 (Punjab and Haryana) learned Tribunal came to the conclusion that the claim petition was maintainable. Learned Tribunal in view of the provisions of Section 163-A of the Act held that the income of the deceased was to be considered as Rs. 40,000/- only, and keeping in view the age of the deceased a multiplier of 17 was applied and compensation to the tune of Rs. 4,53,340/- was awarded in favour of the claimants along with a sum of Rs. 2,000/- for funeral expenses and Rs. 5,000/- for loss of consortium and in this way total compensation was awarded to the tune of Rs. 4,60,340/- against Lakhbir Singh and National Insurance Company and the liability was held to be joint and several. The compensation was apportioned between the claimants and respondents No. 4 and 5. Costs of the petition were also awarded.
7. Shri L.M Suri, learned senior counsel appearing for the appellant by placing reliance on the judgment of Hon'ble Supreme Court reported as Deepal Girishbhai Soni v. United India Insurance Co. Ltd., Baroda, 2004 (2) RCR (Civil) 466 (SC) : (2004-2) 137 PLR 271, argued that provisions of Section 163-A of the Act are in the nature of social provision providing for a distinct scheme and only those persons whose annual income is up to Rs. 40,000/- could take the benefit thereof and other claims were required to be determined in terms of Chapter XII of the Act. Para No. 64 of the judgment is reproduced as below:—
“We, therefore, are of the opinion that Kodala, (2001-2) 128 P.L.R 663 (S.C) (supra), has correctly been decided. However, we do not agree with the findings of Kodala (supra) that if a person invokes provisions of Section 163-A, the annual income of Rs. 40,000/- per annum shall be treated as a cap. In our opinion, the proceeding under Section 163-A being a social security provision, providing for a distinet scheme, only those whose annual income is up to the Rs. 40,000/- can take the benefit thereof. All other claims are required to be determined in terms of chapter XII of the Act.”
8. The Hon'ble Supreme Court was further pleased to hold that the compensation under Sections 163A and 166 are final and independent of each other as was statutorily provided and, therefore, it was not open to pursue the remedy simultaneously.
9. Learned counsel for the appellant also placed reliance on a Division Bench judgment of this Court in the case Himachal Road Transport Corporation v. Baldev Kumar Nayyer, 2006 (2) RCR (Civil) 682 (P&H) : (2006-2) 143 PLR 75 to contend that the Tribunal cannot treat the petition filed under Section 166 of the Act under Section 163-A by restricting the income to Rs. 40,000/-. In the said case, this Court by placing reliance on Deepal Girishbhai Soni's case (supra) set aside the award passed under Section 163-A of the Act and remanded the case back for decision on the petition filed under Section 166 of the Act in accordance with law.
10. No body has put in appearance on behalf of the respondents.
11. The learned Tribunal had allowed the claim petition filed under Section 163-A of the Act by relying upon the judgment of Hon'ble Single Judge of this Court in Indu Sharma's case (supra) by holding that the reading of Section 163-A did not indicate that this was to apply only if the annual income of the deceased was within the range of Rs. 40,000/-. The Hon'ble Single Judge came to the conclusion that the close scrutiny of the IInd Schedule showed that, the legislature has specified various multipliers keeping in view the age of the victims and further guidelines have been given about the other amounts of compensation under various heads such as funeral expenses, loss of consortium and loss to the estate. However, in view of the judgment of the Hon'ble Supreme Court which is relied upon by the Division Bench of this Court, it cannot be said that the said judgment lays down good law and can be deemed to have been impliedly overruled.
12. It has been categorically laid down by the Hon'ble Supreme Court in the case of Deepal Girishbhai Soni's case (supra) that the provisions of Section 163-A of the Act would be applicable if the income is up to Rs. 40,000/- per annum and to no other person. The Hon'ble Division Bench of this Court, by relying upon the judgment of Hon'ble Supreme Court in Deepal Girishbhai Son's case (supra) has further laid that a petition under Section 166 of the Act cannot be treated to be one under Section 163-A by restricting the income at Rs. 40,000/- per annum.
13. It is not in dispute that in the present case, the income of the deceased was shown to be Rs. 10,000/- per month and therefore, the claimants were not entitled to invoke the provisions of Section 163-A of the Act. Therefore, I agree with the contention raised by the learned Counsel for the appellants that petition under Section 163-A of the Act, in the present case, was not competent. It has not been shown whether any application under Section 166 of the Act was also filed and, therefore, no comments are called on this aspect of the matter.
14. In view of the finding recorded above, this appeal is accepted and the award of the learned Tribunal is set aside by holding that application under Section 163-A of the Act was not competent.
Appeal allowed.
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