FA/1311/1997 1/32 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 1311 of 1997 With FIRST APPEAL No. 1312 of 1997 With CIVIL APPLICATION No. 5959 of 1997 In FIRST APPEAL No. 1311 of 1997 For Approval and Signature: HONOURABLE MR.JUSTICE A.M.KAPADIA HONOURABLE MR.JUSTICE Z.K.SAIYED ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= UNITED INDIA INSURANCE CO.LTD. - Appellant(s) Versus LILABEN VALLABHBHAI & 2 - Respondent(s) ========================================================= Appearance : MR VIBHUTI NANAVATI for Appellant(s) : 1, None for Respondent(s) : 1, MR A.A.QURESHI FOR MR SHAKEEL A QURESHI for Respondent(s) : 1.2.1, 1.2.2, 1.2.3, 1.2.4, 1.2.5,1.2.6 NOTICE SERVED for Respondent(s) : 2 - 3. ==================================================== FA/1311/1997 2/32 JUDGMENT CORAM : HONOURABLE MR.JUSTICE A.M.KAPADIA and HONOURABLE MR.JUSTICE Z.K.SAIYED Date : 11/07/2008 COMMON ORAL JUDGMENT (Per : HONOURABLE MR.JUSTICE A.M.KAPADIA) 1. Challenge in these two appeals filed under Section 173 of the Motor Vehicles Act, 1988 ('the Act' for short) is to the correctness of the judgment and award dated 5.11.1996 rendered in MACP Nos.398 of 1995 and 399 of 1995 by the Motor Accident Claims Tribunal (Main), Bhavnagar, by which both the claim petitions filed under Section 166 of the Act by the respondents/claimants ('the claimants' for short) against the appellant as well as the driver and owner of the truck bearing registration No.GJ-1U- 4428 to recover compensation of Rs.14 lakhs in each of the claim petitions on account of the untimely demise of Vallabhbhai Devshibhai Hirpara and Vallabhbhai Nanjibhai Vaghasia in a road FA/1311/1997 3/32 JUDGMENT accident which took place on 28.3.1995 at about 7 P.M., near village Kosamba, between Dhamrol and Surat, on Ahmedabad - Mumbai National Highway No.8A, has been partly allowed and thereby the claimants of MACP No.398 of 1995, who are the heirs and legal representatives of deceased Vallabhbhai Devshibhai Hirpara, were held entitled to a total compensation of Rs.12,20,000/- and the claimants of MACP No.399 of 1995, who are the heirs and legal representatives of deceased Vallabhbhai Nanjibhai Vaghasia, were held entitled to a total compensation of Rs.12,40,000/- together with interest and costs thereon from the date of the application till realization and accordingly the appellant, respondent driver and owner were directed to pay jointly and severally the amount of compensation to the claimants of both the claim petitions. 2. As per the averments made in the claim petitions, on fateful day, Vallabhbhai Devshibhai FA/1311/1997 4/32 JUDGMENT Hirpara and Vallabhbhai Nanjibhai Vaghasia along with one Valjibhai Jadavbhai Savaliya, who was also injured in the accident, were proceeding in a Maruti Car bearing registration No. GJ-15C-3543 which was driven by Vallabhbhai Nanjibhai slowly and on the correct side of the road. The said car was of the ownership of Amar Textiles Fabrics of which Vallabhbhai Nanjibhai was a partner. All the three persons started their journey from village Savarkundla and they were proceeding towards Surat. When the said car reached near the place of occurrence, a truck bearing registration No.GJ-1U-4428 driven by its driver in a rash and negligent manner and completely on the wrong side of the road came from the opposite direction. It was the case of the claimants that another public career was going ahead of the offending truck. But without taking care of the other vehicles coming from the opposite direction, the driver of the offending truck overtook the truck which was going ahead of it and in that process he left the correct side of the road and came on the wrong side of the road, after leaving the white line FA/1311/1997 5/32 JUDGMENT divider and entered just opposite the Maruti car, driving it in a rash and negligent manner, in excessive and uncontrollable speed, and dashed his vehicle with the Maruti Car. As a result of the impact, the car was excessively damaged and Vallabhbhai Devshibhai Hirpara and Vallabhbhai Nanjibhai Vaghasia sustained serious injuries and the Valjibhai Jadavbhai Savaliya, who was accompanying them, sustained injuries. Vallabhbhai Devshibhai succumbed to the injuries immediately after the accident while Vallabhbhai Nanjibhai Vaghasia died on the same day during treatment in a hospital at Surat. In respect of the said accident an offence was registered against Punabhai Nanjibhai Koli, the driver of the offending truck, at Kosamba Police Station being CR No.61/1995. On registration of the offence, investigation was carried out. Bodies of both the deceased persons were sent for autopsy. It was further case of the claimants that the accident was the result of rash and negligent driving of the offending truck by its driver. It was further case of the claimants that Punabhai FA/1311/1997 6/32 JUDGMENT Nanjibhai Koli was the driver of the offending truck and, therefore, he being the tort-feasor was solely responsible for the accident and hence primarily liable to pay compensation to the claimants whereas Sukhdevsinh Ramsinh Jat was the owner of the offending truck and therefore he was liable under the principle of vicarious liability and the said truck was insured with the appellant - United India Insurance Company Limited and, therefore, the appellant is also liable as it has to indemnify the owner for the award passed against him being the insurance company of the offending truck. Therefore, the claimants claimed compensation from all the three opponents jointly and severally. 2.1. Putting forward the claim for compensation, the claimants of MACP No.398 of 1995, being heirs and legal representatives of deceased Vallabhbhai Devshibhai, claimed that the deceased was of 49 years at the relevant time. He was well built and was running diamond factories FA/1311/1997 7/32 JUDGMENT at Surat as well as at Savarkundla. He owned and possessed 60 bighas of agricultural land situated at two different places; 30 bighas of land situated near village Jasdan under Rajkot District and 30 bighas of land situated at village Karuka. The deceased was earning Rs.75,000/- per annum from agriculture and Rs.1,50,000/- per annum from the diamond business. The claimants were fully dependent upon the income of the deceased and on his demise they lost the dependency benefits and on all counts they claimed Rs.14 lakhs by way of compensation from the driver, owner and insurance company of the offending vehicle. 2.2. Putting forward the claim for compensation, the claimants of MACP No.399 of 1995, being the heirs and legal representatives of deceased Vallabhbhai Nanjibhai, claimed that deceased Vallabhbhai Nanjibhai was aged 40 years at the relevant time and he was well built. He FA/1311/1997 8/32 JUDGMENT was also running a diamond factory at Savarkundla. He also owned and possessed 18 bighas of agricultural land situated within the local limits of Umrala village under Bhavnagar District. He was the partner in Amar Textiles Fabrics at Vapi. He was earning Rs.1,50,000/- per annum from agriculture and Rs.50,000/- per annum from diamond business. The entire family was fully dependent upon the income of deceased and on his death they lost dependency benefits. Therefore, they claimed Rs.14 lakhs by way of compensation from the driver, owner and insurance company of the offending truck. 2.3. It may be noted that the driver and owner of the offending truck, though duly served, elected not to remain present before the Tribunal. The appellant - insurance company contested the claim petitions by filing separate written statements in both the claim petitions. The insurance company has denied the factum of FA/1311/1997 9/32 JUDGMENT accident. It was also denied that the driver of the offending truck was rash and negligent in driving the truck at the relevant time. It was contended that the driver of the truck was driving the vehicle in contravention of the conditions incorporated in the insurance policy and, therefore, the insurer is not liable to pay the damages. It was also pleaded that the driver of the Maruti Car was driving his car in a rash and negligent manner and as a result of his rashness and negligence in driving the car, the accident took place. Therefore, according to the insurance company, the driver of the Maruti Car was solely responsible for the accident. In sum and substance the defence of the insurance company was that the driver of the Maruti car was totally negligent and as a result of his negligence in driving the car the accident took place and therefore the insurance company is not liable to pay compensation. FA/1311/1997 10/32 JUDGMENT 2.4. So far as the claim for compensation put forward by the claimants is concerned, the age, income and prospective income of both the deceased persons are denied. It was also emphasized that there was no loss to the claimants so far as income earned from the partnership firm as well as the income earned from agriculture by both the deceased persons are concerned. In sum and substance, the insurance company has denied the claim on all counts and prayed to dismiss both the claim petitions filed by the claimants. 2.5. The Tribunal, after considering the oral as well as documentary evidence and more particularly complaint Ex.95, panchnama Ex.19 and oral evidence of injured Valjibhai Jadavbhai recorded at Ex.91 who was travelling with both the deceased persons in the Maruti car and survived in the accident, came to the conclusion that the Maruti car was proceeding from north FA/1311/1997 11/32 JUDGMENT towards south and truck was coming from south towards north i.e., from the opposite direction and as per the panchnama the Maruti car was found completely on the eastern direction of the road which was the correct side of the car and the truck was found extremely on the wrong side of the road. From the above position, it was found that the truck, after coming on the wrong side, dashed with the Maruti car as a result of which the accident took place. Therefore the Tribunal held that the driver of the truck was solely responsible for causing the accident and on account of his rashness and negligence in driving the truck, the accident in question took place in which two persons lost their lives and one person was injured. 2.6. So far as quantum of compensation claimed by the claimants is concerned, the Tribunal has assessed the income of deceased Vallabhbhai Devshibhai at Rs.1,50,000/- per annum and after FA/1311/1997 12/32 JUDGMENT deducting 1/3rd for personal upkeep, arrived at the dependency at Rs.1 lakh per annum and thereafter applied 12 multiplier and the datum figure was worked out at Rs.12 lakhs to which Rs.20,000/- was added as conventional amount towards loss of estate and thus awarded Rs.12,20,000/- together with interest and costs to the claimants of MACP No.398 of 1995 as compensation for the death of Vallabhbhai Devshibhai Hirpara whereas in MACP No.399 of 1995, the Tribunal has assessed the income of the deceased Vallabhbhai Nanjibhai at the same rate and applied the same multiplier and awarded Rs.12,00,000/- under the head of loss of dependency benefit to which Rs.20,000/- was added for mental pain, shock and sufferings and Rs.20,000/- was also added for loss of expectation of life and thus awarded Rs.12,40,000/- together with interest and costs to the claimants of MACP No.399 of 1995 as compensation for the death of Vallabhbhai Nanjibhai. FA/1311/1997 13/32 JUDGMENT 2.7. It is this judgment and award which has given rise to instant batch of two appeals at the instance of the insurance company - United India Insurance Company Limited. 3. Mr. Vibhuti Nanavati, learned advocate for the appellant-insurance company in both the appeals, has contended that he challenges the award to the extent of Rs.7,20,000/- in First Appeal No.1311 of 1997 whereas Rs.7,40,000/- in First Appeal No.1312 of 1997. 3.1. So far as the negligence on the part of the driver is concerned, it is contented by him that the Tribunal, without appreciating the documentary evidence in the form panchnama Ex.19 showing the damage caused to the Maruti car and damage caused to the truck held that the driver of the truck was solely responsible for causing the accident. If the evidence with respect to FA/1311/1997 14/32 JUDGMENT negligence is properly appreciated it would be clear that the driver of the Maruti car was negligent at least to the extent of 50%. 3.2. According to him, the Tribunal has wrongly assessed the prospective income of both the deceased at Rs.1,50,000/- per annum by accepting uncorroborated testimonies. It is emphasized by him that it is settled by catena of decisions that for assessing the income of a deceased person derived from agriculture, it has to be calculated in terms of the managerial capacity of the deceased to manage agricultural operations. In the instant case, there is not an iota of evidence on record as to what was the exact income earned by the deceased persons from agriculture. It is also contended by him that to establish that the deceased were running diamond polishing business, nothing is produced on record. In sum and substance, according to Mr. Nanavati, there is no evidence on record, except the income tax returns showing the income of the FA/1311/1997 15/32 JUDGMENT deceased from diamond polishing business. It is also highlighted by him that even if it is accepted that both the deceased were carrying on business of diamond polishing, the capital invested in the said business has remained intact and same can be employed by their heirs in some other investment so that they can earn income from them. It is therefore submitted by him that the impugned award under the appeals is excessive and exorbitant and it is on higher side and hence it requires to be modified by awarding compensation to the extent of Rs.5 lakhs only to the claimants in both the claim petitions. He, therefore, urged to reduce the compensation to RS.5 lakhs with proportionate costs and interest thereon in each claim petition and allow both the appeals partly. 4. In counter submission, Mr. A.A. Qureshi, learned advocate for Mr. Shakeel Qureshi, learned advocate for the claimants in both the claim petitions, has contended that the FIR and FA/1311/1997 16/32 JUDGMENT Panchnama speak volumes about the negligence on the part of the driver of the offending truck. There is no evidence to the effect that the driver of the Maruti car - Vallabhbhai Nanjibhai Vaghasia was negligent in driving the car. On the contrary, there is evidence on record to show that he was driving the car at a moderate speed and on the correct side of the road. In this connection, has has drawn the attention of this court to the oral evidence of sole eye witness Valjibhai Jadavbhai Savaliya who was travelling in the Maruti car at the relevant time and also received injuries in the very accident. He has unequivocally deposed before the Court that the driver of the offending truck was extremely on wrong side of the road and he was driving the truck at an excessive speed which has caused the accident. Therefore, the Tribunal has rightly reached to the conclusion that the driver of the offending truck was solely responsible for causing the accident. FA/1311/1997 17/32 JUDGMENT 4.1. So far as the income of the deceased persons from the business is concerned, according to him, both the deceased persons were running diamond polishing business and deceased Vallabhbhai Nanjibhai was also a partner in the partnership business in the name and style of Amar Textiles Fabrics and also holding agricultural land. Therefore, the Tribunal has rightly assessed the prospective income of both the deceased persons at Rs.1,50,000/- per annum and assessed the dependency benefits at Rs.1 lakh per annum. Mr. Qureshi, therefore, submitted that the impugned award is neither excessive nor on higher side requiring interference of this Court. He, therefore, urged to dismiss both the appeals. 5. We have considered the submissions advanced by Mr. Vibhuti Nanavati, learned advocate for the appellant and Mr. A.A. Qureshi, learned advocate for the claimants, in both the appeals. We have also perused the impugned judgment and award and the set of evidence supplied by the learned FA/1311/1997 18/32 JUDGMENT advocates appearing for the parties during the course of their submission and also gone through the record and proceedings of both the claim petitions. 6. To prove the negligence on the part of the driver of the offending truck, on behalf of the claimants, Valjibhai Jadavbhai Savaliya, a person who was travelling along with the two deceased persons in the Maruti Car and who had also received injuries in the accident was examined at Ex.91. He has inter alia testified that the Maruti car in which he was travelling was driven by Vallabhbhai Nanjibhai Vaghasia on the correct side of the road with moderate speed. The car was proceeding from north towards south whereas the offending truck was coming from south towards north. From the perusal of the Panchnama Ex.19, it transpires that the truck was being driven on the wrong side of the road. There was a white line divider on the road and the truck entered on the eastern side of the road i.e., the tuck came FA/1311/1997 19/32 JUDGMENT on the wrong side of the road and dashed with the Maruti car. Therefore, it has to be held that the driver of the offending truck did not observe the rules and regulations of the traffic and he was driving the truck on the wrong side of the road in a rash and negligent manner and as a result of his negligent driving the truck dashed with the Maruti car. 6.1. On reappraisal of the aforesaid evidence, it is clearly established that the driver of the offending truck was solely responsible for the accident and no negligence can be attributed to the driver of the Maruti car and in the accident two promising and prosperous businessmen lost their life and Valjibhai Jadavbhai sustained injuries. Therefore, the finding arrived at by the Tribunal with regard to the negligence of the driver of the offending truck is in consonance with he evidence adduced by the claimants and hence the said finding is required to be upheld by this Court. Accordingly, we also hold that the FA/1311/1997 20/32 JUDGMENT driver of the offending truck was solely responsible for the accident as he was driving the offending truck with excessive speed and in a rash and negligent at the relevant time. 7. This takes us to examine whether the Tribunal has quantified the just and reasonable compensation or it is on higher side requiring interference of this court. 8. In First Appeal No.1311 of 1997 which is arising out of the judgment and award rendered in MACP No. 398 of 1995, the claimants who are the heirs and legal representatives of deceased Vallabhbhai Devshibhai Hirpara, have claimed Rs.14 lakhs as compensation. To justify the claim, on behalf of the claimants, Lilaben Vallabhbhai, widow of Vallabhbhai Devshibhai Hirapra, was examined at Ex.88. She has inter alia testified that the deceased was running diamonding polishing business at Surat as well as Savarkundla. He was also paying income tax. FA/1311/1997 21/32 JUDGMENT To prove the income as well as prospective income of the deceased, she has produced the following documentary evidence: Sr.No . Description Ex.No. 1 Statement showing total income for A.Y. 1994-95 21 2 Acknowledgment receipt of return 22 3 Entries from books of A/c. for A.Y.1995-96 23 4 Statement showing computation of total income from A.Y. 1993-94 24 5 Acknowledgment receipt of return for A.Y. 1994-95 25 6 Entries from books of A/c. 26 7 Birth date certificate of the deceased 27 8 Birth date certificate of claimant No.1. 28 9 Birth date certificates of children 29 & 30 10 Certificate to the effect that Rajnikant is studying in Engineering College 31 11 Birth date certificate of Bhumi 32 12 Entries of Revenue record 36, 38, 39, 40, 41 and 42 13 Entries of Revenue Record 33 to 35 FA/1311/1997 22/32 JUDGMENT 9. On perusal of the documentary evidence, there is no manner of doubt that the deceased was earning Rs.76,332/- from agricultural operations and Rs.70,130/- from the business and his taxable income was Rs.43,042/- He was holding agricultural land admeasuring 60 bighas situated at different places and his date of birth being 30.10.1946 he was 49 years old at the relevant time. On the basis of the aforesaid finding, the Tribunal has assessed the prospective income of the deceased at Rs.1,50,000/- per annum, which according to us, is definitely on higher side. On reappraisal of the evidence, according to us, the income of the deceased from the business was Rs.70,130/- as per the income tax return produced at Ex.22. So far as the agricultural income is concerned, the same was Rs.76,332/- According to us, the loss of agricultural income is to be assessed in the managerial capacity of the deceased and, therefore, we are of the considered opinion that the prospective income of deceased from the business is to be assessed FA/1311/1997 23/32 JUDGMENT at Rs.80,000/- per annum whereas income from agricultural operation in the capacity of manager can be assessed at Rs.40,000/- per annum. Therefore, we assess the prospective income of the deceased at Rs.1,20,000/- per annum. From this amount 1/3rd has to be deducted for the person upkeep of the deceased himself as he would have definitely spent considerable amount for his own maintenance. In doing so, the net dependency benefit available to the claimants of MACP No.398 of 1995, who are the heirs and legal representatives of deceased Vallabhbhai Devshibhai Hirpara works out to the figure of Rs.80,000/- per annum. 9.1. Looking to the age of the deceased at the relevant time, the multiplier of 12 applied by the Tribunal is just and proper and we do not intend to disturb the said finding. 9.2. Thus, the datum figure which works out is Rs.80,000 x 12 = Rs.9,60,000/- to which we add FA/1311/1997 24/32 JUDGMENT Rs.20,000/- towards the loss of expectation of life and Rs.20,000/- as consortium. Therefore, the claimants of MACP No.398 of 1995 are entitled to the compensation in the following break-up: Rs. 9,60,000/- loss of prospective income Rs. 20,000/- loss of expectation of life Rs. 20,000/- consortium ============= Rs.10,00,000/- Total compensation Thus, the claimants of MACP No.398 of 1995 are entitled to get Rs.10,00,000/- as compensation. We, therefore, award Rs.10,00,000/- with proportionate costs and interest thereon instead of Rs.12,20,000/- as awarded by the Tribunal. 9.3. So far as the claimants of MACP No. 399 of 1995, who are the heirs and legal representatives of deceased Vallabhbhai Nanjibhai Vaghasia, are concerned, they have claimed compensation of RS.14 lakhs. To prove the claim, on behalf of the claimants, Shardaben FA/1311/1997 25/32 JUDGMENT Vallabhbhai, widow of Vallabhbhai Nanjibhai Vaghasia, was examined at Ex.90. She has, inter alia, testified that the deceased was born on 23.5.1955. Therefore he was aged about 40 years at the time of his death. She has also testified that he was running a diamond factory at Savarkundla and he was also a partner of a partnership firm in the name and style of Amar Textiles Fabrics at Vapi and he was the owner and in possession of 18 bighas of land situated within the local limits of village Umrala under Bhavnagar District. To corroborate the said evidence, following documentary evidence were produced: Sr.No. Description Ex.No. 1. Cash memo of Shri Mahavir Hospital, Surat 50 2. Birth date certificate of deceased Vallabhbhai Nanjibhai 53 3. Birth date certificate of his children 54 to 58 4. Demand notice of I.T. Department for A.Y. 1993-94 59 5. Acknowledgment receipt of return for A.Y. 1993-94 60 FA/1311/1997 26/32 JUDGMENT Sr.No. Description Ex.No. 6. Income Tax Chalan 61 7. Entries from books of A/c. for A.Y. 1993-94 62 8. Computation of income for A.Y.1994-95 63 9. I.T. Notice for A.Y.1992-93 64 10. Acknowledgment receipt of return for A.Y. 1992-93