IN THE HIGH COURT OF UTTARAKHAND AT NAINITAL Appeal From Order No. 195 of 2006 United India Insurance Company Ltd. … Appellant Vs Sri Ganda Singh & others … Respondents With Appeal From Order No. 194 of 2006 United India Insurance Company Ltd. … Appellant Vs Master Neeraj Kumar & others … Respondents Sri K.K. Shah, learned counsel for the appellant Sri Promod Belwal, learned counsel for the respondents/claimants Sri Raman Kumar Shah, learned counsel for the respondent/owner Hon’ble B.C. Kandpal, J. Both these appeals arises out of the same motor accident, therefore, I am deciding the same by this common judgment. For the sake of convenience, I am narrating the facts of Appeal No. 195 of 2006. 2. Appeal No. 195 of 2006 under Section 173 of the Motor Vehicle Act, 1988 has been filed by the appellants/ United India Insurance Company Ltd. against the judgment and award dated 28.01.2006 passed in M.A.C. Case No. 187 of 2003 whereby the Tribunal decreed the claim petition against the appellant for a sum of Rs. 2,47,000/- along with conditional interest. 3. Appeal No. 194 of 2006 under Section 173 of the Motor Vehicle Act, 1988 has been filed by the appellants/ United India Insurance Company Ltd. against the judgment and award dated 28.01.2006 passed in M.A.C. Case No. 145 of 2004 whereby the Tribunal decreed the claim petition against 2 the appellant for a sum of Rs. 91,000/- along with conditional interest. 4. Brief facts of the case are that on 09.10.2003 at about 05:30 p.m. a truck bearing registration No. UP06/5938, which was being driven by its driver in a very rash and negligent manner, hit the deceased Ratan Singh near Maheshwari Nursing Home, Nazibabad Road, Kotdwar. The deceased due to injuries sustained by him died at the spot. In the same accident Master Neeraj Kumar sustained serious injuries on his body, who has preferred another appeal. According to the claim petition, the deceased was running a thela and doing labour work by which he used to earn Rs. 4,000/- per month. The claimants are the members of his family and dependents upon him. Therefore, they filed the claim petition before the Tribunal for a sum of Rs. 7,20,000/- as compensation. 5. The opposite party No. 1 – Kuldeep Singh, owner of the vehicle in question has contested the claim petition by filing written statement alleging therein that the driver of the offending vehicle was having the valid driving licence upto 11.12.2006 and the vehicle in question was insured with the appellant/United India Insurance Company Ltd. from 21.05.2003 to 20.05.2004, therefore, the liability of compensation lies upon the insurer of the vehicle in question. 6. Opposite party No. 2/appellant also contested the claim petition by filing its written statement before the Tribunal alleging therein that the claimant and the owner did not produce documents i.e. registration certificate, driving licence, proof of income, permit, fitness certificate etc before the Tribunal. It has further pleaded that the accident took 3 place due to negligence of the deceased himself, therefore, the claimants are not entitled to get any compensation for the negligence of the deceased himself. It is also pleaded that the claimant and the owner are in collusion, hence, the insurer reserves its right to raise other necessary pleas in its defence under Section 170 of the Motor Vehicle Act, if the owner fails or negligent to contest the petition properly. It has further pleaded that the driver of the vehicle in question did not possess the valid driving licence, therefore, the claim petition against the insurer was liable to be dismissed. 7. On the basis of the pleadings of the parties, the Tribunal has framed relevant issues, which were discussed in great detail. Thereafter both the parties led evidence in support of their case. The Tribunal after having considered the material available on record and hearing learned counsel for the parties decreed the claim petition for a sum of Rs. 2,47,000/- along with conditional interest of 9%, in appeal No. 195 of 2006 and Rs. 91,000/- along with conditional interest of 9%. The Tribunal further directed that the amount of compensation awarded shall be paid to the claimants by the insurer of the vehicle i.e. United India Insurance Company Ltd. 8. Feeling aggrieved by the aforesaid judgment and award, the appellant has preferred these appeals before this Court. 9. Heard Sri Sri K.K. Shah, learned counsel for the appellant, Sri Promod Belwal, learned counsel for the respondents/claimants, Sri Raman Kumar Shah, learned counsel for the respondent/owner and perused the record. 4 10. Learned counsel for the appellant has firstly argued that the liability to pay the amount of compensation has been wrongly fixed upon the insurer of the vehicle. He has invited my attention towards this aspect that on the date of accident, the driver of the offending vehicle did not possess any valid driving licence in his favour, therefore, the Insurance Company would not be liable to indemnify the insured. The driving licence of the driver of the offending vehicle, namely, Sher Singh available on record as paper No. 21C. This paper shows that the driver of the offending vehicle was entitled to drive the light motor vehicle, medium goods/passenger vehicle as well as heavy goods/passenger vehicle and this licence was valid upto 10.07.2002. 11. It is worthy to mention here that the accident in this case took place on 09.10.2003, whereas the paper No. 21C shows that after 10.07.2002 it was not renewed upto 12.12.2003. The document indicates that it was further renewed on 12.12.2003 upto 11.12.2006. The signature below the Licencing Authority shows that the licence was renewed on 12.12.2003. This fact itself indicates that on the date of accident, the driver was not in possession of any valid and effective driving licence in his favour. There is no evidence available on record, which shows that after the licence was expired previously i.e. 10.07.2002, any application for the renewal of the same was moved by the driver of the offending vehicle within a period of 30 days. 12. Learned counsel for the respondent/owner of the vehicle has invited my attention towards the decision of Hon’ble Apex Court in United India Insurance Company Ltd. Vs Lehru repoted in AIR 2003 Supreme Court 1292 and has submitted that the renewal of the driving licence of 5 subsequent date itself shows that the driver was having valid and effective driving licence on the date of the accident. He has further submitted that in case, if the court comes to the conclusion that the driver was not at all possessing any effective driving licence, even then the Insurance Company will have to pay the amount of compensation subject to the recoverable right against the owner of the vehicle. 13. I have gone through the judgment cited by the learned counsel for the owner/respondent, but in view of the later pronouncement of Supreme Court in Sardari Vs Sushil Kumar reported in 2008(2) T.A.C. 369 (S.C) and Ram Babu Tiwari Vs United India Insurance Company Ltd. & others reported in 2008 SAR (Civil) 864, it is quite clear that in case, on the date of the accident, the driver of the offending vehicle does not possess any valid and effective driving licence, then Insurance Company is not liable to pay the amount of compensation. The Supreme Court in 2008 SAR (Civil) 864 (Supra) has observed in paragraphs Nos. 18 and 19, which reads as under:- “18. It is beyond any doubt or dispute that only in the event an application for renewal of licence is filed within a period of 30 days from the date of expiry thereof, the same would be renewed automatically which means that even if an accident had taken place within the aforementioned period, the driver may be held to be possessing a valid licence. The proviso appended to sub- section (1) of Section 15, however, clearly states that the driving licence shall be renewed with effect from the date of its renewal in the event the application for renewal of a licence is made more than 30 days after the date of its expiry. It is, therefore, evident that as on renewal of the licence on such terms the driver of the vehicle cannot be 6 said to be holding a valid licence, the insurer would not be liable to indemnify the insured. The second proviso appended to sub-section (4) of Section 15 is of no assistance to the appellant. It merely enables the licensing authority to take a further test of competent driving and passing thereof to its satisfaction within the meaning of sub-section (3) of Section 9. It does not say that the renewal would be automatic. It is, therefore, a case where a breach of the contract of insurance is established. This aspect of the matter has been considered by this Court in National Insurance Co. Ltd. v. Kusum Rai [(2006) 4 SCC 250] holding: “11. It has not been disputed before us that the vehicle was being used as a taxi. It was, therefore, a commercial vehicle. The driver of the said vehicle, thus, was required to hold an appropriate licence therefor. Ram Lal who allegedly was driving the said vehicle at the relevant time, as noticed hereinbefore, was holder of a licence to drive a light motor vehicle only. He did not possess any licence to drive a commercial vehicle. Evidently, therefore, there was a breach of condition of the contract of insurance. The appellant, therefore, could raise the said defence.” It was furthermore held: “14. This Court in Swaran Singh4 clearly laid down that the liability of the insurance company vis- à-vis the owner would depend upon several factors. The owner would be liable for payment of compensation in a case where the driver was not having a licence at all. It was the obligation on the part of the owner to take adequate care to see that 7 the driver had an appropriate licence to drive the vehicle.” It was opined: “16. In a case of this nature, therefore, the owner of a vehicle cannot contend that he has no liability to verify the fact as to whether the driver of the vehicle possessed a valid licence or not.” 19. The principle laid down in Kusum Rai (Supra) has been reiterated in Ishwar Chandra v. Oriental Insurance Co. Ltd. & Ors. [(2007) 10 SCC 650], referring to sub-section (1) of Section 15 of the Act, this Court stated the law, thus: “9. From a bare perusal of the said provision, it would appear that the licence is renewed in terms of the said Act and the rules framed thereunder. The proviso appended to Section 15(1) of the Act in no uncertain terms states that whereas the original licence granted despite expiry remains valid for a period of 30 days from the date of expiry, if any application for renewal thereof is filed thereafter, the same would be renewed from the date of its renewal. The accident took place 28-4-1995. As on the said date, the renewal application had not been filed, the driver did not have a valid licence on the date when the vehicle met with the accident.” 14. In view of the aforesaid observations made by the Hon’ble Apex Court, I am of the view that in the instant case, the driver was not having the valid and effective driving licence in his possession on the date of accident. However, I am not entering into that aspect of the matter, whether the driving licence was fake or valid, in view of the finding recorded by me in the earlier part of this judgment. 8 15. The next point for consideration in this appeal is as to whether the multiplier adopted by the Tribunal in the instant case appears to be just and adequate or not. The record reveals that the Tribunal has assessed the notional income of the deceased as Rs. 36,000/-, which in my view does not appear to be convincing at all. No positive and cogent evidence was adduced by the claimant in order to show the actual income of the deceased on the date of the accident. Therefore, it is quite clear that the principle of notional income will have to be taken into account. The accident in this case took place in the year 2006 and in view of the Division Bench of this Court in Pratima Devi & others Vs Pratap Singh & others reported in 2008 (1) U.D. 276, the notional income in view of the price hike has been assessed as Rs. 30,000/- per annum. In the instant case, if the notional income is to be assessed as Rs. 30,000/- per annum, then after deducting 1/3rd as personal expenses of the deceased, the financial dependency of the claimants comes to Rs. 20,000/- per annum. The age of the deceased has been assessed as 43 years in this case and the Tribunal adopted the multiplier of ‘15’ in this case, which is of course, on higher side. In view of the latest pronouncement of Hon’ble Apex Court in The New India Assurance Company Ltd. Vs Smt. Kalpana & others reported in (2007) 2 Supreme Court Cases (Cri) 94, T.N. State Transport Corporation Vs S. Rajapriya & others reported in (2005) 6 SCC 276 and The Managing Director, TNSTC Vs Sripriya & others reported in 2007 (5) Supreme 301 the multiplier at the age of 43 years would be maximum to ‘10’. 16. In case, if the multiplier of ‘10’ is adopted in this case then the total amount of compensation to be paid in favour of the claimants come to Rs. 2,00,000/- (20000 x 10). 9 However, the amount awarded by the Tribunal as Rs. 2,000/- for funeral expenses and Rs. 5,000/- for loss of love and affection is concerned, the same shall remain intact. In this way, the total amount of compensation comes to Rs. 2,07,000/- in favour of the claimants. 17. As far as the conditional interest awarded by the Tribunal is concerned, I am of the view that the claimants should be entitled to get the amount of compensation along with an interest @ 6% per annum from the date of filing the claim petition till the actual date of payment instead of conditional interest @ 9% awarded by the Tribunal. 18. On the basis of the aforesaid assessment of evidence, the appeal is partly allowed. In Appeal No. 195 of 2006 the impugned judgment and award dated 28.01.2006 is modified to the extent that the claimants are entitled for a sum of Rs. 2,07,000/- instead of Rs. 2,47,000/- along with interest @ 6% per annum instead of conditional interest of 9% per annum as has been awarded by the Tribunal, the amount so awarded in favour of the claimants shall be paid by the owner of the offending vehicle in question and the Insurance Company i.e. appellant/United India Insurance Company Ltd. shall have no liability to pay the amount of compensation. The direction issued by the Tribunal in this regard is hereby set aside. 19. Consequently, cross objection No. 6313 of 2006, filed by the claimants is dismissed. 20. In appeal No. 194 of 2006, the Tribunal awarded a sum of Rs. 91,000/- in favour of the claimants. I do not find any ground to interfere in the impugned judgment and award 10 passed by the Tribunal concerned in M.A.C. Case No. 145 of 2004. The Tribunal on the basis of the material available on record as well as considering the facts and circumstances of the case has rightly awarded the amount of compensation, which does not require any interference. However, in view of the observations made by me in the body of the judgment, the claimants are entitled to get the compensation along with interest @ 6% per annum instead of conditional interest. 21. With the aforesaid observations made by me in the body of judgment, appeal No. 194 of 2006 is partly allowed. The impugned judgment and award dated 28.01.2006 is modified to the extent that the claimants are entitled for a sum of Rs. 91,000/- along with interest @ 6 per annum instead of conditional interest of 9% per annum as has been awarded by the Tribunal, the amount so awarded in favour of the claimants shall be paid by the owner of the offending vehicle in question and the Insurance Company i.e. appellant/United India Insurance Company Ltd. shall have no liability to pay the amount of compensation. The direction issued by the Tribunal in this regard is hereby set aside. 22. The statutory amount deposited by the appellant before this Court at the time of filing the appeal in both the appeals be remitted to the Tribunal concerned. The appellant is permitted to withdraw the same from the Tribunal concerned. 23. Let the copy of this judgment be placed in A.O. No. 194 of 2006. (B.C. Kandpal, J.) 01.12.2008 ASWAL