IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No 1845 of 1990 WITH FIRST APPEAL NO. 2565 OF 1992 WITH CIVIL APPLICATION NO. 7533 of 1998 For Approval and Signature: Hon'ble MR.JUSTICE J.M.PANCHAL and MR.JUSTICE M.C.PATEL ============================================================ 1. Whether Reporters of Local Papers may be allowed to see the judgements? Yes 2. To be referred to the Reporter or not? Yes 3. Whether Their Lordships wish to see the fair copy of the judgement? No 4. Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? No 5. Whether it is to be circulated to the Civil Judge? No -------------------------------------------------------------- UNITED INDIA INSURANCE CO.LTD Versus JYOTSNABEN WD/O MADHUSUDAN SHANTILAL BHATT -------------------------------------------------------------- Appearance: MR DARSHAN M PARIKH for United India Insurance Co.Ltd. MR GIRISH D.BHATT & MR ASHISH H.SHAH, for original claimants. MR SATISH A.PANDYA, A.G.P. for D.G.P. Gujarat State. in both the appeals and Civil Application. -------------------------------------------------------------- CORAM : MR.JUSTICE J.M.PANCHAL and MR.JUSTICE M.C.PATEL Date of decision: 27/11/98 C.A.V. JUDGEMENT : (Per : Panchal, J.) These appeals, which are filed under section 110-D of the Motor Vehicles Act, 1939, are directed against judgment and award dated May 28, 1990 rendered by the Motor Accident Claims Tribunal (Main), Himatnagar, District : Sabarkantha in M.A.C.P. No. 439/87 and, therefore, we propose to dispose of them by this common judgment. 2. The then Chief Minister of State of Gujarat Mr. Amarsinh Chaudhary was to visit Bhiloda on June 24, 1987. Deceased Madhusudan Shantilal Bhatt, who was serving as a Police Inspector, was in piloting jeep bearing registration No. GAD-5834. The piloting jeep was being driven by police constable Mavjibhai Hiraji, who was impleaded as opponent no.1 in the claim petition. When the Chief Minister's motorcade was between Hunjh and Jagatpur, the piloting jeep in which the deceased was sitting, turned turtle, as a result of which the deceased suffered several serious injuries. As the deceased had received injuries, he was removed to Civil Hospital, Himatnagar, but his condition deteriorated and therefore, he was shifted to Civil Hospital, Ahmedabad for intensive treatment. Inspite of all the efforts made by the medical personnel, the deceased expired on June 28, 1987 at Ahmedabad. According to the appellants of First Appeal No. 2565/92, driver of the jeep was rash and negligent in driving the same, as a result of which the accident occurred and deceased died. Under the circumstances, they instituted M.A.C.Petition No. 439/87 before Motor Accident Claims Tribunal (Main) Sabarkantha at Himatnagar and claimed compensation of Rs. 3 lacs in all. The claim petition was instituted against the driver of the jeep, Director General of Police, Gujarat State and United India Insurance Co.Ltd. with which the jeep was insured. 3. The Director General of Police, Gujarat State contested the claim petition by filing written statement Exh.22. In the written statement, it was claimed by the Director General of Police that the jeep driver was never rash in driving the jeep and, therefore, claim petition was liable to be dismissed. It was also stressed therein that the driver of the jeep was driving the same at moderate speed, but accidentally the rear tyre of the jeep had burst, as a result of which it had turned turtle and, therefore, it being an act of God, the claimants were not entitled to receive any compensation. 4. United India Insurance Co.Ltd. with which the jeep was insured, contested the claim petition by filing written statement Exh.27. By filing the written statement the Insurance Company, inter-alia, pleaded that the deceased had not died because of rash and negligent driving of the vehicle by its driver and, therefore,the claim petition was liable to be dismissed. 5. Having regard to the pleadings of parties, the Tribunal raised necessary issues for determination at Exh.29. After taking into consideration the evidence of the driver of the jeep as well as contents of the First Information Report which was lodged with reference to the accident in question and the panchnama of the place of occurrance, the Tribunal held that the accident took place because of rashness and negligence on the part of the driver in driving the jeep. Thereafter the Tribunal took into consideration the evidence led by the claimants regarding income of the deceased and deduced that the income of the deceased was Rs. 2,420/- per month at the time of accident. The Tribunal deducted a sumof Rs. 200/from the monthly income of the deceased as expenses which would have been incurred by the deceased on himself and thus, the Tribunal held that the dependency benefit of Rs. 2220/- per month i.e. Rs. 26,640/- per annum was available to the claimants. Having regard to the age of the deceased, the Tribunal was of the opinion that it would be proper to apply multiplier of 12 to the facts of the case and thus, under the head of loss of income, the Tribunal awarded a sum of Rs. 3,56,680/- to the claimants as compensation. It was noted by the Tribunal that original claimant no.1 who was the widow of the deceased,had lost consortium of husband for all time to come all of a sudden and the daughters had lost their loving father and, therefore, the Tribunal awarded a sum of Rs. 15000/- to the claimants under the head of loss of consortium. As noted earlier, after the accident the deceased was first removed to Civil Hospital, Himatnagar and thereafter to Civil Hospital, Ahmedabad. Therefore, the Tribunal awarded a sum of Rs.15,000/- to the claimants under the head of mental agony,shock and suffering. Over and above the above-referred to sums, the Tribunal granted a sum of Rs. 2000/- being expenses incurred by the claimants for obsequies of the deceased and Rs. 5000/- for medicines and other sundry expenses. Thus, the Tribunal assessed awardable compensation at Rs. 3,56,680/-. It was noticed by the Tribunal that the then Chief Minister Mr. Amarsinh Chaudhary had sanctioned a sum of Rs. 1,50,000/- to the dependents of the deceased as a measure of immediate relief. The Tribunal was of the opinion that the exgratia payment made to the dependents of the deceased by the then Chief Minister was deductible from the total compensation payable to the claimants. The Tribunal, therefore, deducted the said amount from the awardable compensation. The Tribunal also held that sum of Rs. 15000/- paid to the original claimants under the principle of 'no fault liability' was deductible from the assessed compensation. Under the circumstances, the Tribunal held that the total compensation awardable to the claimants was Rs. 1,91,680/-. In ultimate decision,the Tribunal directed the original opponents to pay jointly and severally a sum of Rs. 1,91,680/together with running interest at the rate of 12% per annum from the date of application till realisation and proportionate costs as compensation to the claimants by judgment and award dated May 28, 1990, giving rise to present appeals. 6. In First Appeal No. 2565/92, the main grievance of the appellants is that the Tribunal was not justified in deducting the sum of Rs. 1,50,000/- which was paid to the dependents of the deceased as exgratia payment by the then Chief Minister from the awardable amount of compensation; whereas in First Appeal No. 1845/90, the grievance of the Insurance Company is that the Insurance Company was liable for risk of an employee travelling in a vehicle to the extent of Rs.15,000/- only and the Tribunal was not justified in passing award of Rs.1,91,680/- with 12% interest from the date of application till realisation against the Insurance Company. In support of its claim advanced in First Appeal No. 1845/90,the United India Insurance Co.Ltd. has filed Civil Application No.7533/98 praying the Court to permit it to produce a complete copy of the policy. That application was ordered to be heard with the main appeal and, therefore, we propose to dispose of that application with these appeals. We may state that against this very judgment and award, all the three original opponents had filed First Appeal No. 2311/92 in the High Court and the Division Bench consisting of Hon'ble Mr.Justice V.H.Bhairavia and Hon'ble Mr. Justice Y.B.Bhatt had rejected the First Appeal by passing following order on February 11, 1993;- "Leave to amend the names of the parties. Having regard to the facts and circumstances of the case, the quantum award is just and proper. We do not see any just reason for interference with the same. Hence, appeal is dismissed." 7. M/s.G.D.Bhatt and Ashish H.Shah,learned Counsel for the appellants in First Appeal No. 2565/92 submitted that the Tribunal was not justified in deducting sum of Rs. 1,50,000/- paid by the State Government to the original claimants as grace and, therefore, the impugned award in so far as the same is against the appellants, deserves to be modified. Elaborating the said argument it was claimed that the exgratia payment was not made towards the liability to pay compensation to be determined in future against the State Government, but it was an exgratia payment for the purpose of helping the family members of the deceased who were in distress and, therefore, the amount paid by way of grace should not have been deducted from the awardable compensation to the claimants. After referring to Exh.53, which is Government Resolution granting exgratia payment to the claimants, it was pleaded that the said amount was paid to the claimants independently of the existence of a right to claim compensation available to the claimants and, therefore, the Tribunal should not have deducted the said amount from the assessed awardable compensation. What was asserted was that the exgratia payment was voluntary, uncovenanted as well as discretionary and as it was made available with an intention to alleviate distress of family members of the deceased, it was not liable to be deducted from the amount of compensation. In support of the above-referred to submissions, learned Counsel for the appellants placed reliance on the decisions rendered in cases of (1) Perry vs. Cleaver, 1969 ACJ 363, (2) M.D.Chacko vs. N.Sreedharan and others, 1990 ACJ 439, (3) State of Himachal Pradesh v. Dole Ram, 1981 ACJ 219, (4) Shakuntala Rameshchandra Sant and others V. Rajedra D. Thakkar and another, 1994 ACJ 1147, (5) Geethakumari and others v. Rubber Board and others, 1994 ACJ 796, (6) Pallavan Transport Corporation Ltd. (Metro) v. P. Murthy and others, 1989 ACJ 413, (7) Andhra Pradesh State Road Trans. Corporation v. B.Krishnaji Rao and another, 1995 ACJ 983, (8) Raj Chopra and others v. Sangara Singh and others, 1985 ACJ 209, (9) Krishna Kapoor and others v. Himachal Road Transport Corporation, 1994 ACJ 1183, and (10) Bimla Dubey and others v. Himachal Road Transport Corporation and another, 1992 ACJ 166. 8. Mr. Darshan M.Parikh, learned Counsel for the appellants in First Appeal No. 1845/90 pleaded that as per the policy and also as per the law, liability of Insurance Company was limited to the extent of Rs. 15,000/- and, therefore, Insurance Company could not have been held responsible for any amount, except the amount of Rs. 15,000/-. It was claimed on behalf of the Insurance Company that the first page of the insurance policy was on record, but the whole policy was not produced before the Tribunal and in order to do complete justice between the parties, Court should permit the Insurance Company to produce complete copy of the policy on record. Learned Counsel for the Insurance Company further stressed that the exgratia payment was made by the State Government, who is vicariously liable for the action of the tort-feasor and, therefore, it is rightly deducted from the amount of compensation determined as payable to the dependents of the deceased. In support of his submissions, learned Counsel placed reliance on the decisions rendered in cases of (1) Pushpabai Parshottam Udeshi and others v. M/s. Ranjit Ginning & Pressing Co.Pvt.Ltd. and another, AIR 1977 SC 1735, (2) Harshvardhatiya Rudraditya (by his next friend & guardian) Govindbhai D. Parmar & Ors. v. Jyotindra Chimanlal Parikh & Anr. 1981 G.L.R. 555, and (3) National Insurance Co.Ltd. New Delhi v. Jugal Kishore and others, AIR 1988 SC 719. 9. Mr. Satish A.Pandya, learned A.G.P. submitted that exgratia payment was made by the State Government to the dependents of the deceased and, therefore, the Tribunal was justified in deducting the said amount from the awardable amount of compensation. The learned Counsel for the State Government claimed that exgratia payment is a condition of the contract of service and it is payable only on the death of the employee and as it is not a voluntary payment on charitable ground on the occasion of death, but it is an advantage by reason of death, that amount cannot be claimed by the dependent unless death of the employee occurs, as a result of which the said amount is deductible from the amount of compensation. In support of this submission, learned Counsel for the State Government placed reliance on the decisions rendered in cases of (1) Kashiram Mathur and others v. Sardar Rajendra Singh and another, 1983 ACJ 152, (2) Delhi Transport Corporation and others v. Sharda Vasudev and others, 1986 ACJ 424, (3) Raj Chopra and others v. Sangara Singh and others, 1985 ACJ 209, and (4) Gauri Bai and others v. Ramesh Kumar and others, 1994 ACJ 1044. Learned Assistant Government Pleader asserted that the plea that the liability of the Insurance Company was limited to the extent of Rs. 15,000/- was not raised in the written statement filed by the Insurance Company and, therefore, application seeking permission of the Court to produce copy of policy should be rejected. It was stressed that one page of the policy was produced by the learned Advocate who appeared on behalf of the Insurance Comapny and in view of vague contention regarding liability having been raised in the written statement of the Insurance Company, the appeal as well as application seeking permission to produce additional evidence at the appellate stage should be dismissed. 10. In view of the rival submissions advanced at the Bar, the question which arises for consideration of the Court is whether the exgratia payment made by the State Government to the dependents of the deceased is deductible from the amount of awardable compensation ? Before answering the question posed for consideration, it would be relevant to notice the nature of exgratia payment made by the State Government to the family members of the deceased. The Government resolution Exh.53 specifically states that in order to help the family members of the deceased, it was decided to make available a sum of Rs. 1,50,000/- as financial assistance. It is relevant to note that no plea whatsoever was raised either by the driver of the jeep or by the Director General of Police that exgratia payment was payment towards compensation or that it was deductible from the amount of compensation. No issue was framed by the Tribunal as to whether the amount of exgratia payment made to the dependents of the deceased was deductible from the amount of compensation or not. The exgratia payment has a peculiar characteristic. Normally, it is conferred on the injured or the dependents of the deceased, independently of the existence of any right in him/them to receive compensation. It is made available to redress and alleviate the difficulties which may be faced by the dependents of the deceased all of a sudden. It is disposition in favour of the dependents of the deceased intended for alleviating miseries resulting from sudden accidental death of an employee. The payment of exgratia amount is not intended to compensate the dependents of the deceased. Exgratia payment cannot be obtained as of right. It is discretionary and is granted after consideration of several relevant factors. Exgratia payment is voluntary, uncovenanted as well as discretionary and cannot be enforced as of right and the only intention of making such payment is to alleviate distress of family members of the deceased. There are certain special services, aids, benefits, subventions and the like which in most communities are available to the injured or his dependents. Simple examples are hospital and pharmaceutical benefits which lighten the monetary burden of illness. If the injured plaintiff has availed himself of these, he cannot establish or calculate his damages on the footing that he did not do so. On the other hand,there may be advantages which accrue to the injured plaintiff, whether as a result of legislation or of contract or of benevolence, which have an additional characteristic. It may be true thatthey are conferred because he is intended to enjoy them in the events which have happened. Yet they have this distinguishing characteristic, namely, they are conferred on him not only independently of the existence in him of a right of redress against others, but so that they may be enjoyed by him although he may enforce that right; they are the product of a disposition in his favour intended for his enjoyment and not provided in relief of any liability in others fully to compensate him. If a fund is raised by subscription for the benefit of a badly injured neighbour obviously this cannot operate in relief of the liability of a man who negligently causedthe injury. So also in a contract of accident insurance, where in the absence of special stipulation the insurer will not succeed by subrogation or otherwise to the insured's right of recourse against others in the case of injury by their negligence. But for the reason given it does not follow that the negligent parties can treat the insurance as operating in relief of their liability. It was effected by the money of the plaintiff for his own benefit in the event of an accident; a benefit both independent of and cumulative upon whatever right of redress against others might arise out of the circumstances of the accident. It is evident that exgratia payment cannot be obtained as of strict right and it is granted after consideration of the position or situation in which the dependents of the deceased stand and entirely for their use and benefit and not for the use of any person antecedently liable to them to compensate them in any way. In the case of Mrs. Helen C.Rebello & Ors. v. Maharashtra State Road Transport Corporation & another, Judgement Today, 1998(6) S.C. 418, the question which was considered by the Supreme Court was whether the amount received by the heirs of the insured under a Life Insurance Policy, is deductible from the amount of compensation or not. After reviewing the law on the subject, the Supreme Court has held that the amount received under the life insurance policy has no co-relation to the compensation computed under the provisions of the Motor Vehicles Act, 1939, as heirs received the amount under the Act without any contribution. What is emphasised by the Supreme Court is that compensation payable under the Motor Vehicles Act would not include that which heirs of the deceased would have received on account of other form of deaths even apart from accidental death. The pertinent observations made by the Supreme Court are as under :- "35. Thus, it would not include that which claimant receives on account of other form of deaths, which he would have received even apart from accidental death. Thus, such pecuniary advantage would have no corelation to the accidental death for which compensation is computed. Any amount received or receivable not only on account of the accidental death, but that would have come to the claimant even otherwise, could not be construed to be the 'pecuniary advantage', liable for deduction. However, where the employer insures his employee, as against injury or death arising out of an accident, any amount received out of such insurance on the happening of such incidence may be an amount liable for deduction. However, our legislature has taken note of such contingency, through the proviso of Section 95. Under it, the liability of the insurer is excluded in respect of injury or death, arising out of, in the course of employment of an employee. 36. This is based on the principle that the claimant for the happening of the same incidence may not gain twice from two sources.This, it is excluded thus, either through the wisdom of legislature or through the principle of loss and gain through deduction not to give gain to the claimant twice arising from the same transaction,viz. same accident. It is significant to record here in both the sources viz. either under the Motor Vehicles Act or from the employer, the compensation receivable by the claimant is either statutory or through the security of the employer securing for his employee but in both cases he receives the amount without his contribution. How thus an amount earned out of one's labour or contribution towards one's wealth, savings, etc. either for himself or for his family, which such person knows, under the law, has to go to his heirs after his death either by succession or under a Will could be said to be the 'pecuniary gain' only on account of one's accidental death. This even otherwise than the accidental death. No co-relation between the two. Similarly, life insurance policy is received either by the insured or the heirs of the insured on account of the contract with the insurer, for which insured contributes in the form of premium. It is receivable even by the insured,if he lives till maturity after paying all the premiums, in the case of death insurer indemnifies to pay the sum to the heirs, again in terms of the contracts for the premium paid. Again this amount is receivable by the claimant not on account of any accidental death, but otherwise on insured's death. Death is only a step or contigency in terms of the contract, to receive the amount. Similarly any cash, bank balance, shares, fixed deposits etc. though are all a pecuniary advantage receivable by the heirs on account of one's death but all these have no co-relation with the amount receivable under a statute occasioned only on account of accidental death. How could such an amount come within the periphery of the Motor Vehicles Act to be termed as 'pecuniary advantage' liable for deduction. When we seek the principle of loss and gain, it has to be on similar and same plane having nexus inter se between them and not to which, there is no semblance of any co-relation. The insured (deceased) contributess his own money for which he receives the amount has no co-relation to the compensation computed as against of course, is a pecuniary gain but how this is equitable or could be balanced out ofthe amount to be received as compensation under the Motor Vehicle Act. There is no co-relation between the two amounts. Not even remotely. How can an amount of loss and gain of one contract could be made applicable to the loss and gain of another contract. Similarly, how an amount receivable under a statue has any co-relation with an amount earned by an individual. Principle of loss and gain has to be on the same place within the same sphere, of course, subject to the contract to the contrary or, any provisions of law." 11. We note that exgratia payment was not made to the dependents of the deceased only because the deceased died in a motor accident. The compensation payable under the Motor Vehicles Act is on account of the pecuniary loss to the claimants by accidental injury or death and not other forms of deaths. The exgratia payment can be made if there is natural death or death by suicide, serious illness,including even death by accident through train, air flight not involving motor vehicle and such payment would not be covered under the Motor Vehicles Act. 12. In SHAKUNTALA RAMESHCHANDRA SANT AND OTHERS (Supra), Trial Court had deducted exgratia payment made to the dependents of the deceased. While reversing that part of the order it was held as under:-