THE HON’BLE SRI JUSTICE N.V. RAMANA AND THE HON’BLE SRI JUSTICE P. DURGA PRASAD M.A.C.M.A. No. 5175 of 2008 Oral order: (Per N.V. Ramana, J.) M/s. National Insurance Company Limited, represented by its Branch Manager, has filed this M.A.C.M.A. against the orders dated 02.02.2008, passed by the Chairman, Motor Accidents Claims Tribunal-cum-III Additional District Judge, Tirupati, in M.V.O.P. No. 181 of 2006, awarding compensation of Rs. 10,54,672/- to respondent Nos. 1 to 3-claimants as against their claim for Rs. 20,00,000/- contending that the same is on the higher side and needs to be reduced. On 01.02.2004, respondent No.1 along with his wife and other family members and respondent No.5 were going in Tata Sumo bearing No. PY 01 K 4573 to Pakala from Tirupati to attend his brother’s marriage. In the midway on Nendragunta-Tirupati road, at about 4.30 A.M. they met with an accident when the Tata Sumo in which they were travelling hit a Tractor at a high speed. In the accident, the wife of respondent No.1, namely K. Vasantha Kumari, sustained grievous injuries. She was admitted in the hospital, and on 15.03.2004, she succumbed to the injuries. A case of rash and negligent was registered against the driver of the Tata Sumo. The deceased at the time of her death was aged 33 years and working as ANM in Primary Health Centre, Nendragunta and earning Rs.6,822/- per month. Respondent Nos. 1 to 3 contending that they are dependent on the income of the deceased, and that on account of her untimely death in the accident, they have lost dependency, filed the above M.V.O.P. claiming compensation of Rs.20,00,000/- from the appellant and the owner of the Tata Sumo. Respondent No.5 remained ex parte. Respondent No.4-owner of the Tata Sumo filed counter stating that the Tractor came in front of the Tata Sumo all of a sudden and under unavoidable circumstances, he caused the accident, and that there is no negligence on the part of the driver of the Tata Sumo. The driver is holding valid driving licence. The Tata Sumo is insured with the appellant, and he has not violated the terms of the policy. The M.V.O.P. is bad for non-joinder of the owner of the Tractor. The compensation payable, if any, is only by the appellant. The appellant also filed counter stating that there was no negligence on the part of the Tata Sumo driver. The driver of the Tractor is responsible for the accident because he drove it in a rash and negligent manner. The owner of the Tractor and the Insurance Company with which it is insured are proper and necessary parties, and the M.V.O.P. is liable to be dismissed for not joining them as parties. The compensation claimed by respondent Nos. 1 to 3 is excessive and exorbitant. Based on the rival pleadings, the Tribunal framed issues, namely whether the accident occurred due to the rash and negligent driving of the Tata Sumo by its driver; whether the Tata Sumo is insured with the appellant and if so whether the policy covered the risk of the deceased; whether respondent Nos.1 to 3 are legal heirs of the deceased, and if so, to what amounts they are entitled to and whether M.V.O.P. is bad for non-joined of necessary parties. Before the Tribunal, respondent Nos. 1 to 3-claimants examined P.Ws. 1 to 3 and marked Exs. A1 to A7 and Exs. X1 and X2 were marked through witnesses, while respondent No.1 examined himself as R.W.1 and the appellant marked Ex. B1. The Tribunal having considered the issues in the light of the evidence let in by the parties, held that the accident occurred due to the rash and negligent driving of the Tata Sumo by its driver. That the Tata Sumo was insured with the appellant and that the policy was in force as on the date of the accident and that it covered the risk of the deceased. That respondent Nos. 1 to 3 being the husband and children are the legal heirs of the deceased. So far as quantum of compensation is concerned, the Tribunal considering the fact that the deceased was working as ANM and drawing gross salary of Rs.6,822/- per month, took the net salary of the deceased at Rs.6,802/- per month i.e. Rs.81,624/- per annum, and after deducting one-third of the said amount towards her personal expenses, worked out contribution to the family at Rs.54,416/-. As the deceased was aged 33 years, applied the multiplier and worked out the compensation to Rs.9,25,072/-. Apart from the said amount, the Tribunal awarded Rs.15,000/- to respondent No.1 towards loss of consortium and Rs.10,000/- towards funeral expenses and Rs.20,000/- towards loss of estate to respondent Nos. 1 to 3, and medical expenses to the tune of Rs.84,600/-. Thus, in all, the Tribunal by reason of the order under appeal, awarded compensation of Rs.10,54,672/-. The learned counsel for the appellant-Insurance Company mainly urged two grounds. He submitted that since the deceased was traveling in the Tata Sumo as a passenger, and as the insurance policy does not cover the risk of passengers, the appellant is not liable to pay any compensation to respondent Nos.1 to 3-claimants. Hence, he submitted that the Tribunal committed an error in directing the appellant to pay compensation to respondent Nos. 1 to 3-claimants on account of the death of the deceased in the accident. He further submitted that since the deceased was aged 33 years as on the date of the accident, the multiplier applicable is 16, but the Tribunal committed an error in applying the multiplier 17, for the purpose of computing the compensation. Hence, he prayed that the compensation payable be recalculated and reduced. On the other hand, the learned counsel for respondent Nos. 1 to 3-claimants supported the order under appeal and submitted that the compensation awarded by the Tribunal being just compensation, needs no reduction and prayed that the appeal be dismissed. Heard the learned counsel for the appellant and the learned counsel for respondent Nos. 1 to 3-claimants. The contention of the appellant that the deceased was traveling in the Tata Sumo as a passenger cannot be accepted. Respondent No.4, owner of the Tata Sumo in his evidence stated that the deceased and her family members are not related to him, but they are his colleagues. That he has paid premium covering the risk of third parties and inmates and the insurance policy was in force as on the date of the accident. The appellant except stating that since the deceased was traveling as a passenger, and as such, they are not liable to pay compensation because the policy does not cover the risk of third parties, did not adduce any evidence except marking Ex. B1-policy. A perusal of Ex.B1 would disclose that it is a private car policy. The Tata Sumo, admittedly, is a private vehicle of respondent No.4. The deceased, admittedly, was traveling as an occupant and she was not being carried for hire or reward. The liability of the Insurance Company, as contained in Section II(1)(i) of the Standard Motor Package Policy, in respect of a occupant of a private car and pillion rider in a two-wheeler under the Standard Motor Package Policy, was clarified by the Insurance Regulatory and Development Authority, vide circular issued in Ref: IRDA/NL/COR/F&U/073/11/2009, dated 16.11.2009. As per the said circular, the insured’s liability in respect of occupant(s) carried in a private car and pillion rider carried on two- wheeler is covered under the Standard Motor Package Policy. Since the deceased was traveling in the private Tata Sumo as an occupant and not for hire or reward, she should be treated as a third party, thereby making the appellant liable to pay the compensation to the claimants for her death. Therefore, no exception can be taken to the order passed by the Tribunal making the appellant liable to pay the compensation to respondent Nos. 1 to 3-claimants on account of the death of the accident. So far as quantum of compensation is concerned, as can be seen from the award, the deceased working as ANM. She was getting gross salary of Rs.6,822/- per month, out of that Rs.20/- was being deducted towards professional tax, and after such deduction, she was getting net salary of Rs.6,802/- per month. The deceased was aged 33 years as on the date of the accident. She was holding a permanent job in the Government. As per the judgment of the apex Court in Sarla Verma v. Delhi Transport Corporation[1], an addition of 50% to the actual salary of the deceased should be made where the deceased is aged less than 40 years and had a permanent job towards future prospects. Admittedly, the Tribunal did not add 50% to the actual salary of the deceased for the purpose of computing the compensation. Instead, the Tribunal took the net salary of the deceased at Rs.6,802/- per month i.e. Rs.81,624/- per annum. And as the deceased was having three dependants, deducted one-third towards his personal expenses, and worked out the annual loss of dependency at Rs.54,416/-. As the deceased was aged 33 years, the Tribunal applied the multiplier 17. Though as per the judgment of the apex Court in Sarla Verma v. Delhi Transport Corporation, the relevant multiplier applicable to a person aged 33 years is 16, but considering the fact that respondent Nos. 1 to 3-claimants would be entitled to more compensation if 50% of the actual salary is added for the purpose of computing the compensation, and as they did not file any cross appeal seeking any enhancement, we do not wish to add 50% of the actual salary for the purpose of computing the compensation, and at the same time, we do not wish to disturb the multiplier 17 and the compensation. Hence, by application of the multiplier, respondent Nos. 1 to 3-claimants would be entitled to (Rs.54,416/- x 17), which works out to Rs.9,25,072/-. This apart, as awarded by the Tribunal, respondent Nos. 1 to 3- claimants are entitled to Rs.84,600/- towards medical expenses, which are supported by medical bills and which they incurred for treatment of the deceased who was in the hospital for one and a half month after the accident. Apart from the said amount, the Tribunal, admittedly awarded compensation of Rs.15,000/- towards loss of consortium to respondent No.1, and Rs.10,000/- towards funeral expenses and Rs.20,000/- towards loss of estate to respondent Nos. 1 to 3. Though the amounts awarded by the Tribunal under the said heads, having regard to the judgment of the apex Court in Sarla Verma v. Delhi Transport Corporation, have to be reduced, but since respondent Nos.1 to 3- claimants are entitled to more compensation, which we are refusing to grant because of non-filing of cross-appeal by them, but considering the fact that the compensation payable to them should be just compensation, having regard to the facts and circumstances of the case, we do not wish to reduce the compensation under the aforesaid heads. Thus, in all, as awarded by the Tribunal, respondent Nos. 1 to 3-claimants shall be entitled to Rs.10,54,672/-, however, with reduced rate of interest at the rate of 6% per annum from the date of filing of the petition till the date of realization. Accordingly, the M.A.C.M.A. is partly allowed. No costs. ________________ N.V. RAMANA, J. ____________________ P. DURGA PRASAD, J. Dated: 22nd December, 2011 KSR [1] (2009) 6 SCC 121