THE HONOURABLE SRI JUSTICE N.V. RAMANA AND THE HONOURABLE SRI JUSTICE P. DURGA PRASAD M.A.C.M.A. No. 1561 of 2006 and Cross Objections (SR). No. 37160 of 2006 COMMON JUDGMENT: (Per Hon’ble Sri Justice N.V. Ramana) The present appeal and the cross objections arise out of the order and decree dated 31.03.2006 passed in M.V.O.P. No. 342 of 2004 by the Chairman, Motor Accidents Claims Tribunal-cum-III Additional District Judge, Guntur. While the appeal is filed by M/s. National Insurance Company Limited, denying its liability to pay the compensation awarded to the claimants under the order under appeal and alternatively contending that the compensation awarded to the claimants is excessive and needs to be reduced, the claimants preferred cross-objections claiming enhancement of compensation. Respondents 1 to 4 in the appeal, who are the cross-objectors, filed the above O.P., claiming compensation of Rs.12,00,000/- from the appellant and respondent No.5, for the death of one Karanam Hanumat Prasad in a motor accident that occurred on 27.02.2004. Respondent Nos.1 and 2 are the parents, respondent No.3 is the wife and respondent No.4 is the minor son of the deceased. It was their case that on 27.02.2004, the deceased was traveling in the jeep bearing No. AP20T 5583 from Narasaraopet to Sattenpalli and the driver of the jeep drove the jeep in a rash and negligent manner, due to which the jeep turned turtle, resulting in the death of the deceased on the spot. The claimants contended that the deceased was aged 33 years and working as a teacher in Brugubanda Z.P. High School and getting Rs.8,000/- per month. The owner of the jeep, respondent No.5 in the appeal, remained ex parte before the Tribunal and the appellant- insurance company filed written statement and resisted the claim of the claimants, stating that the owner of the jeep had violated the terms and conditions of the policy, as at the time of accident, seven persons were being carried in the jeep and the driver of the jeep had no valid driving license, and hence it is not liable to pay any compensation to the claimants. Before the Tribunal, the claimants examined P.Ws. 1 to 3 and marked Exs.A1 to A6 on their behalf, while R.Ws.1 and 2 were examined and Exs.B1 to B7 were marked on behalf of the appellant- insurance company. The Tribunal, having considered the stand of the parties and the oral and documentary evidence adduced by them, held that the accident occurred due to the rash and negligent driving of the driver of the crime vehicle. Having regard to the evidence of P.W.2, who is an eyewitness to the accident and as there was no positive evidence to show that the seating capacity of the jeep was less then seven persons and that the driver of the jeep had no valid license as on the date of accident, the Tribunal disbelieved the version of the appellant that the owner of the jeep had contravened the terms and conditions of the policy and held that the appellant, being the insurer of the jeep, cannot escape its liability and it has to pay the compensation to the claimants and can recover the same from the owner of the jeep in separate proceedings, by proving that he contravened the terms and conditions of the policy. The Tribunal awarded a total compensation of Rs.10,55,000/- to the claimants, payable by the appellant and respondent No.5, with interest at 6% per annum from the date of petition till the date of deposit of the amount, and apportioned the same among the claimants as detailed in the order under appeal, and accordingly allowed the petition in part with proportionate costs. The counsel for the appellant-insurance company contends that the appellant is not liable to pay the compensation amount as the driver of the crime vehicle was not having valid and effective driving license at the time of accident and he alternatively contends that the compensation awarded by the Tribunal is excessive and needs to be reduced. On the other hand, the counsel appearing for the claimants contends that the Tribunal erred in deducting the amounts contributed by the deceased towards GIS, LIC and APGLI and that the Tribunal did not consider the future prospects of the deceased. We have considered the submissions made by the counsel on either side and perused the order under appeal and other material available on record. Though it is stated in the Memorandum of Appeal that the appellant- Insurance Company has obtained permission under Section 170 of the Motor Vehicles Act, across the bar, it is submitted by the counsel appearing for the appellant that the appellant has not obtained any such permission. In view of the same and having regard to the judgment of this Court in Oriental Insurance Company Ltd. Nizamabad Branch v. S. Laxmi and others[1], the appellant is not entitled to question the quantum of compensation granted by the Tribunal. So far as the other contention of the appellant that the driver of the crime vehicle has no valid and effective driving license at the time of the accident and hence it is not liable to pay the compensation, is concerned, the fact remains the appellant has not produced any evidence nor examined any witness much less the officials from the Transport Department to show that the driver of the crime vehicle was not having valid driving license at the time of the accident. In the absence of any such evidence, we are of the considered opinion that the Tribunal was justified in holding that the appellant, being the insurer of the crime vehicle, cannot escape its liability to pay the compensation to the claimants and it can recover the same from the owner of the crime vehicle in separate proceedings, by proving that he has contravened the terms and conditions of the policy. Thus, the appeal filed by the insurance company fails. Coming to the cross-objections filed by the claimants, claiming enhancement of compensation granted by the Tribunal, P.W.3, Headmaster of Z.P. High School, Brugubanda, deposed that the deceased was working as Teacher in Mathematics in the said school and his date of birth is 15.08.1971 as per Ex.X1- Service Register. As per Ex.A6- salary certificate, the gross salary of the deceased was Rs.7,911/- per month, while the net salary, after deductions towards provident fund, GIS, LIC, APGLI and professional tax, was Rs.6,510/- per month. From out of the said amounts, except the professional tax of Rs.20/-, the other amounts contributed by the deceased towards provident fund, GIS, LIC and APGLI, fall towards his savings and hence they would ultimately go to the deceased and hence the same can be taken into consideration for the purpose of arriving at the monthly salary of the deceased. Thus, the salary of the deceased would come to 7,891/- per month. The deceased was aged 32 years at the time of his death, as per the date of birth mentioned in his Service Register. Since the deceased had a permanent job and was below 40 years at the time of his death, as per the decision of the Apex Court in Sarla Verma v. Delhi Transport Corporation[2], an addition of 50% of the actual salary to the actual salary of the deceased can be made towards future prospects. On such addition, the salary of the deceased would come to Rs.11,836.50 ps. per month, i.e. Rs.1,42,038/- per annum. Since the deceased had four dependants, In view of the decision in Sarla Verma case, the deduction towards his personal expenses should be 1/4th and on such deduction, his contribution to the family would come to Rs.1,06,529/- per annum. The age of the deceased was 32 years at the time of his death and hence the appropriate multiplier applicable, as per the decision in Sarla Verma case, is ‘16’. If the multiplicand of Rs.1,06,529/- is multiplied by 16, the loss of dependency to the family would come to Rs.17,04,464/-. In addition, claimant No.3 is entitled to Rs.10,000/- towards loss of consortium and the claimants are entitled to Rs.10,000/- towards loss of estate and Rs.5,000/- towards funeral expenses. Even though the claimants-cross-objectors are entitled to a total compensation of Rs.17,29,464/-, but however, as the claim of the claimants itself is for Rs.12,00,000/-, we restrict the compensation to Rs.12,00,000/-. Thus, the claimants are entitled to the compensation of Rs.12,00,000/- and in view of the decision in Sarla Verma case, the said amount shall carry interest at 6% per annum from the date of petition till the date of realization. Accordingly, we dismiss the appeal of the insurance company and allow the cross-objections of the claimants. No order as to costs. _____________ N.V. RAMANA, J _________________ P. DURGA PRASAD, J 1st August, 2011 IBL [1] 2007 (2) ALD 267 (DB) [2] (2009) 6 SCC 121