1. These two appeals have been filed against the judgment of the learned Judge, Motor Accidents Claims Tribunal, Jaipur, dated 17.6.1989, awarding Rs. 69,000/- as compensation to the claimants against the Oriental Insurance Co. Ltd. (in short 'insurance company') and the driver, Sharat Chandra Mittal. The Appeal No. 341 of 1989 has been filed by the claimants for the enhancement of the amount of compensation and for passing award also against the Life Insurance Corporation of India (in short 'LIC'). The Appeal No. 491 of 1989 has been filed by the insurance company for setting aside the award passed against it.

2. The facts of the case giving rise to these appeals may be summarised thus. On 16.6.1982, the deceased Ram Kishan Mittal, Development Officer with LIC, Chandigarh, was going in the Fiat car No. HRM 225 along with his wife, Radha Devi (claimant No. 1), from Jaipur to Narnaul on the National Highway No. 8. The car was being driven by his son, Sharat Chandra (respondent). At about 11.45 a.m., near Kotputli, the car met with an accident and the deceased Ram Kishan Mittal died the same day as a result of the injuries received by him in the accident. On 14.12.1982, claim petition was filed for Rs. 21,05,000/- by the widow, Radha Devi and his two daughters against the LIC, insurance company and the driver, Sharat Chandra Mittal, with the allegations, in short, that due to rash and negligent driving of the car by its driver, Sharat Chandra Mittal, it met with the accident, the car was owned by the LIC, it was insured with the insurance company, the deceased Ram Kishan Mittal was Development Officer in LIC, Chandigarh, he was getting yearly emoluments of Rs. 77,521/-, he was an income tax payer, at the time of the accident his age was 49 years, the claimants were fully dependent on him, Rs. 5,000/- were spent on his treatment and last rites and they are entitled to get Rs. 21,05,000/- as compensation.

3. In its written statement, the LIC admitted that the accident took place with the said Fiat car on 16.6.1982 near Kotputli, the deceased Ram Kishan Mittal died as a result of the injuries received in the accident, he was Development Officer in its Chandigarh sub-division, the car was being driven by his son, Sharat Chandra Mittal, at the time of the accident and it was insured with the insurance company. The remaining averments of the claim petition have been denied. It has further been averred that the actual owner of the said Fiat car was deceased Ram Kishan Mittal himself and loan was granted to him for the purchase of the said car on the basis of a hire-purchase agreement.

4. In its reply, the insurance company admitted that the car was insured with it, accident took place with the said Fiat car No. HRM 225 on 16.6.1982, deceased Ram Kishan died as a result of the injuries received by him in the accident and it was being driven at that time by Sharat Chandra Mittal. The remaining averments of the claim petition were denied. It has further been averred that the claim petition against it is not maintainable, deceased Ram Kishan Mittal was not a third party, actual owner of the said Fiat car was the deceased himself as his name was also mentioned in its registration certificate, it has been unnecessarily impleaded in the claim petition, the driver Sharat Chandra Mittal was not having driving licence and the claim petition deserves to be dismissed.

5. The driver of the Fiat car, Sharat Chandra Mittal, did not file his written statement.

6. After framing necessary issues and recording the evidence of the parties, the Tribunal gave the said award.

7. It has been contended by the learned counsel for the claimants that the learned Judge of the Tribunal seriously erred to award Rs. 69,000/- with interest at the rate of 10 per cent per annum only, to apply the multiplier of 10, not to take into consideration future prospects and to dismiss the claim petition against the LIC as it is well proved from the evidence on record that the said car was owned by it.

8. Learned counsel for the insurance company contended that the insured was LIC, no award was passed against it and despite it the Tribunal had passed award against the insurance company and on this ground alone the award passed against the insurance company deserves to be set aside. He also contended that the deceased Ram Kishan Mittal was not a third party, his risk was not covered and as such no award could be passed in favour of his legal representatives (claimants).

9. The learned counsel for the LIC duly supported the award.

10. The first question for consideration in these appeals is as to who was the owner of the offending vehicle, namely, Fiat car No. HRM 225 at the time of the accident. In para 9(b) of the claim petition, it has been averred that the car belonged to LIC. In its reply, the LIC has averred that the deceased Ram Kishan Mittal was given loan for the purchase of the said car on his executing a hire-purchase agreement in its favour and he was the owner of the car. Similar is the reply of the insurance company. As already said above, the driver did not file his reply to the claim petition. The claimant Radha Devi, P.W. 1, has disclosed in her cross-examination that the said offending car was got registered in her name in December 1982. The Branch Manager, LIC, Om Prakash Gupta, P.W. 4, has deposed that after accident he moved application, Exh. 7, for taking the offending car in his supurdgi along with his affidavit, Exh. 8 and he took the car in his supurdgi after furnishing supurdginama, Exh. 9. LIC's witness, Vijay Sarin, OP.W. 2, has stated on oath that the widow of the deceased, Radha Devi, purchased the said car No. HRM 225 from LIC after making payment of the balance amount and the LIC accordingly transferred it in her favour. Similar is the statement of the driver, Sharat Chandra Mittal, OP.W. 3. In his application, Exh. 7, the Branch Manager, LIC, Narnaul, Om Prakash Gupta, P.W. 4, has stated that car No. HRM 225 is registered in the name of the LIC, Chandigarh Division, Chandigarh. It has also been averred in it that the car was under him and it was used in connection with his office and the Divisional Manager, LIC, Chandigarh, has instructed him to take the car in his supurdgi. The Munsif-cum-Judicial Magistrate, Kotputli, passed order (paper No. 44) on 9.7.1982 giving the car in the supurdgi of Om Prakash Gupta, P.W. 4. Certificate of insurance, Exh. 3 and insurance policy, Exh. A-5, were issued in the name of "LIC of India, D.O. Chandigarh, A/c R.K. Mittal". After the accident, the claimant Radha Devi addressed a letter, Exh. A-1, to the Divisional Manager, LIC, Chandigarh, stating that the said car is registered in favour of the LIC. Agreement, Exh. A-1 (paper Nos. 63-67), dated 20.12.1980 was executed in between the deceased Ram Kishan Mittal and the LIC. Its para No. 2 clearly recites that LIC has agreed to purchase the said car to be used by the deceased Ram Kishan Mittal for the purpose of business of the Corporation on the terms and conditions described therein. The other paras of the Agreement, Exh. A-1, also show the LIC as its owner. The registration certificate, dated 1.1.1981, Exh. A-7, was initially in the name of "LIC of India, Divn. Chandigarh, A/c R.K. Mittal, Dev. Officer, LIC, Narnaul". On 28.4.1982, following entry was made in it. "A/c of R.K. Mittal, Dev. Officer, LIC, Narnaul, is hereby deleted on 28.4.1982 and purely registered in the name of LIC of India, Divn. Chandigarh". In the registration certificate, Exh. A-7, the last entry, dated 28.12.1982, is to the following effect:

Radha Devi Mittal, wd/o late R.K. Mittal, Ex-Development Officer, Narnaul.

It is thus well proved from the oral and documentary evidence of the LIC itself that the offending vehicle, namely, Fiat car No. HRM 225, belonged to the LIC, Chandigarh, on the date of the accident. The learned Judge, Motor Accidents Claims Tribunal, Jaipur, did not consider all the aforesaid evidence on record and as a result thereof, he wrongly decided the issue No. 2 against the claimants and in favour of the LIC.

11. The next question for consideration is whether the LIC is liable for the negligence and carelessness of the driver, Sharat Chandra Mittal. It is stated in para No. 12 of the claim petition that the driver was driving the said vehicle in the interest of LIC. The LIC has stated in para No. 12 of its reply that at the time of the accident the car was being driven for the personal use of late Ram Kishan Mittal. It is stated in para No. 2 of the agreement, Exh. A-1, paper Nos. 63-66, as follows:

The Corporation shall allow the agent the use of the said vehicle during the period he actually canvasses the business for Corporation and perform and observe all the conditions of this appointment and all the covenants on his part and the conditions contained herein.

The claimant Radha Devi, P.W. 1, has disclosed in her cross-examination that on that day her husband, Ram Kishan Mittal, gave car to his son, Sharat Chandra Mittal, for driving it before the accident. She has also deposed that he (Sharat Chandra Mittal) was driving the car for last 4-5 years. There is no material on the record to indicate that the car was being driven at the time of the accident not for the purpose of the LIC. No suggestion was put in the cross-examination of Radha Devi, P.W. 1 and Sharat Chandra Mittal, NAW 4, that the car was being driven not for the purpose of the business of the LIC. When the car was being driven by Sharat Chandra Mittal for last 4-5 years, it can safely be said that he was driving the car in connection with the business of the LIC. The car No. HRM 225 was given by the LIC to Ram Kishan Mittal for the purpose of its business. There is no clause in the agreement, Exh. A-1, prohibiting him not to engage a driver to drive it. There is also no clause in it that it (LIC) would not be liable for compensation if an accident occurs with the car. The position of the driver, Sharat Chandra Mittal, was similar to the position of the mechanic-cum-driver of the repairer in the case of Guru Govekar v. Filomena F. Lobo Miss 1988 ACJ 585 (SC). It has been observed in its para No. 14 as follows:

Thus on the facts of the case before us we are of the view that the insurer is liable to pay the compensation found to be due to the claimant as a consequence of the injuries suffered by her in a public place on account of the car colliding with her on account of the negligence of the mechanic who had been engaged by the repairer who had undertaken to repair the vehicle by virtue of the provisions contained in Section 94 of the Act which provides that no person shall use except as a passenger or causes or allows any other person to use a motor vehicle in a public place, unless there is in force in relation to the use of the vehicle by that person or that other person, as the case may be, a policy of insurance complying with the requirements of Chapter VIII of the Act. 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 view of these facts and circumstances, it can safely be held that the LIC would be liable to pay compensation to the claimants on account of the death of Ram Kishan Mittal as a result of the accident with its car.

12. It has not been disputed during the arguments that the accident occurred due to the rash and negligent act of the driver, Sharat Chandra Mittal. In view of the aforesaid findings, it can well be said that Ram Kishan Mittal was a third party as he was neither the owner of the car nor its driver. It is not in dispute that the said car No. HRM 225 was insured at the time of the accident with the insurance company. It would be liable to the extent of the entire liability under Section 95(2)(c) of the Motor Vehicles Act, 1939.

13. Now the question is regarding the quantum of compensation. It is not in dispute that the deceased Ram Kishan Mittal was Development Officer in the LIC and his age on the date of the accident was 49 years. His widow Radha Devi, P.W. 1, has stated on oath that the monthly salary of her husband was Rs. 6,000-7,000/- and he used to pay income tax. She has not been cross-examined at all on these points. Assessment Order, Exh. 1 and statement of computation of income, Exh. 2, have been filed. The Tribunal did not rely on the assessment order, Exh. 1 and statement of computation of income, Exh. 2, on the ground that these documents were prepared after the death of Ram Kishan Mittal. The Tribunal without assigning any reason has held that the dependency of the claimants was to the extent of Rs. 500/- per month. Agreement, Exh. A-1, paper Nos. 63-67, which was executed in between Ram Kishan Mittal and LIC shows that he was required to pay Rs. 633/- per month to it in the account of the said car. This itself indicates that his monthly emoluments must be sufficient enabling him to pay Rs. 633/- per month besides meeting the expenses of his family consisting of 5 members. The Tribunal was not justified to reject the assessment order passed under Section 143(1) of the Income Tax Act, relating to the assessment year 1982-83 showing taxable income of Rs. 45,680/-. According to it, his monthly income was Rs. 3,800/-. One-third of this amount may be taken as the amount spent on himself. Admittedly, the deceased Ram Kishan Mittal was in the service of the LIC as a Development Officer. It could easily produce the statement of emoluments drawn by him during the last two-three years. No reason could be assigned for their non-production. They could be the best evidence on this point. An adverse inference can well be drawn against the LIC for not producing them. Thus the dependency would not have been less than Rs. 30,000/- (Rs. 3,800/- x 2/3 x 12) per annum. The deceased would have been in service for about 9 years more. As such the multiplier of 10 needs no interference. The figure of Rs. 60,000/-deserves to be enhanced to Rs. 3,00,000/-(30,000 x 10). The amount of Rs. 9,000/-granted on other counts also deserves to be enhanced to Rs. 20,000/-. As such the claimants are entitled to Rs. 3,20,000/-. They are also entitled to get interest at the rate of 12 per cent per annum instead of 10 per cent per annum.

14. It has been observed by the Hon'ble Supreme Court in para 17 of its judgment given in General Manager, Kerala State Road Transport Corporation v. Susamma Thomas 1994 ACJ 1 (SC), as follows:

In a case of compensation for death it is appropriate that the Tribunals do keep in mind the principles enunciated by this court in Union Carbide Corporation v. Union of India 1991 (4) SCC 584, in the matter of appropriate investments to safeguard the feed from being frittered away by the beneficiaries owing to ignorance, illiteracy and susceptible to exploitation. In that case approving the judgment of the Gujarat High Court in Muljibhai Ajarambhai Harijan v. United India Insurance Co. Ltd. 1983 ACJ 57 (Gujarat), this court offered the following guidelines:

(i) The Claims Tribunal should, in the case of minors, invariably order the amount of compensation awarded to the minor be invested in long term fixed deposits at least till the date of the minor attaining majority. The expenses incurred by the guardian or next friend may, however, be allowed to be withdrawn;

(ii) In the case of illiterate claimants also the Claims Tribunal should follow the procedure set out in (i) above, but if lump sum payment is required for effecting purchases of any movable or immovable property, such as, agricultural implements, rickshaw, etc., to earn a living, the Tribunal may consider such a request after making sure that the amount is actually spent for the purpose and the demand is not a ruse to withdraw money;

(iii) In the case of semi-literate persons the Tribunal should ordinarily resort to the procedure set out at (i) above unless it is satisfied, for reasons to be stated in writing, that the whole or part of the amount is required for expanding an existing business or for purchasing some property as mentioned in (ii) above for earning his livelihood, in which case the Tribunal will ensure that the amount is invested for the purpose for which it is demanded and paid;

(iv) In the case of literate persons also the Tribunal may resort to the procedure indicated in (i) above, subject to the relaxation set out in (ii) and (iii) above, if having regard to the age, fiscal background and strata of society to which the claimant belongs and such other considerations, the Tribunal in the larger interest of the claimant and with a view to ensuring the safety of the compensation awarded to him thinks it necessary to so order;

(v) In the case of widows the Claims Tribunal should invariably follow the procedure set out in (i) above;

(vi) In personal injury cases if further treatment is necessary, the Claims Tribunal on being satisfied about the same, which shall be recorded in writing, permit the withdrawal of such amount as is necessary for incurring the expenses for such treatment;

(vii) In all cases in which investment in long term fixed deposits is made it should be on condition that the bank will not permit any loan or advance on the fixed deposit and interest on the amount invested is paid monthly directly to the claimant or his guardian, as the case may be;

(viii) In all cases Tribunal should grant to the claimants liberty to apply for withdrawal in case of an emergency. To meet with such a contingency, if the amount awarded is substantial, the Claims Tribunal may invest it in more than one fixed deposit so that if need be one such F.D.R. can be liquidated.

These guidelines should be borne in mind by the Tribunals in the cases of compensation in accident cases.

The Motor Accidents Claims Tribunal, Jaipur, will comply with the aforesaid directions.

15. Accordingly, Appeal No. 491 of 1989 is dismissed with costs. The Appeal No. 341 of 1989 is allowed with costs. The amount of compensation is enhanced from Rs. 69,000/- to Rs. 3,20,000/-. This amount will be payable to the claimants-appellants with interest at the rate of 12 per cent per annum from the date of the application (14.12.1982). All the three opposite parties are jointly and severally liable to pay the entire amount.

16. The Motor Accidents Claims Tribunal, Jaipur, will take all this into account and invest as much of the amount as it thinks reasonable in several deposits yielding adequate returns, permitting the claimants to withdraw the interest periodically to be used for their maintenance and upkeep. The Tribunal will make appropriate orders within two months from the date of the deposit of the balance to be made by the Life Insurance Corporation of India, Oriental Insurance Co. Ltd. and Sharat Chandra Mittal (opposite parties in the claim petition) with interest at the rate of 12 per cent per annum.