Case Note & Summary
This first appeal arises from the judgment and award dated 16.08.2004 passed by the Motor Accident Claims Tribunal, Ahmednagar in MACP No.822/2000, where the Tribunal awarded a compensation of Rs.1,87,000/- (inclusive of no fault liability) with 9% interest per annum to the appellants, the widow and minor children of the deceased Rameshlal Kisandas Bajaj. The deceased died in a motor vehicle accident on 10.06.2000 when his scooter was hit from behind by a truck bearing registration No. MP-09/K-3120 driven in an excessive and unmanageable speed. The truck was owned by respondent no.1 and insured with respondent no.2. The appellants had sought a compensation of Rs.11,00,000/- contending that the deceased was 45 years old, a businessman running a liquor shop under the name ‘M/s Rahul Wines’ in Ahmednagar, earning not less than Rs.10,000/- per month, and that the entire family was dependent on his income. The widow obtained transfer of the liquor licences after the death. The Tribunal partly allowed the claim, assessing a reduced loss of income on the premise that the business continued under the widow. The insurer contested the claim on the ground that the driver did not hold a valid driving licence, alleging breach of policy condition, but adduced no evidence before the Tribunal. In the appeal, the appellants contended that the Tribunal’s finding of no loss of income ignored the reality that the widow could not run the business to the same extent, that the income tax returns showed a net annual profit of Rs.88,180/-, that future prospects at 25% should be added, a multiplier of 13 applied, and conventional heads of Rs.70,000/- awarded in line with the Supreme Court decisions in National Insurance Co. Ltd. v. Pranay Sethi and Sarla Verma v. Delhi Transport Corporation. The insurer argued that the award was adequate as the source of income remained intact and that the breach of policy condition absolved it. The High Court reserved judgment on 07.02.2020 and pronounced on 24.07.2020, however the recorded text of the judgment is incomplete and does not contain the final operative order.
Issue of Consideration
Whether the Tribunal erred in assessing compensation at Rs.1,87,000/- by denying loss of income on the ground that the liquor business licence was transferred to the widow; Whether the claimants are entitled to enhancement with addition of future prospects, proper multiplier, and conventional heads; Whether the insurer is liable despite alleged breach of policy condition due to lack of valid driving licence
Law Points
- assessment of just compensation
- loss of income when business licence transferred to widow
- addition of future prospects for self-employed
- selection of multiplier
- conventional heads
- burden of proof on insurer for breach of policy condition
- validity of driving licence
Case Details
2020 LawText (BOM) (07) 4
First Appeal No. 1376 of 2004
Mrs. Madhaveshwari S. Mhase for the appellants, Mr. Rupesh Bora h/f Mr. P.P. Bafna for respondent no.2
Smt. Bharati Rameshlal Bajaj, Ku. Poonam, Vitesh, Rahul (all legal heirs of deceased Rameshlal Kisandas Bajaj)
Mr. Sultan Singh Aparsingh (owner of offending truck) and The National Insurance Company Ltd.
Subscribe to unlock Case Details (Citation, Judge, Date & more)
Subscribe Now
Nature of Litigation
Appeal seeking enhancement of compensation awarded in motor accident claim under the Motor Vehicles Act, 1988
Remedy Sought
Enhancement of the compensation of Rs.11,00,000/- as originally claimed, with reassessment on the basis of proper loss of income, future prospects, and conventional heads
Filing Reason
The Tribunal awarded only Rs.1,87,000/- against the claim of Rs.11,00,000/-; the appellants contended that the award was grossly inadequate, not reflecting the true loss of income, and failed to add future prospects
Previous Decisions
Motor Accident Claims Tribunal, Ahmednagar in MACP No.822/2000 passed award dated 16.08.2004 granting Rs.1,87,000/- with 9% interest per annum
Issues
Whether the Tribunal erred in denying loss of income on the ground that the liquor business licences were transferred to the widow?
Whether the assessment of compensation by the Tribunal was just and proper in law, particularly regarding the addition of future prospects, selection of multiplier, and conventional heads?
Whether the respondent no.2 insurance company is liable to pay compensation despite alleging breach of policy condition due to the driver not holding a valid driving licence?
Submissions/Arguments
Appellants argued that the Tribunal wrongly held that transfer of licences removed any loss of income, ignoring the ground reality that the widow could not run the business with the same proficiency; the income tax returns disclosed a net annual profit of Rs.88,180/- and a gross profit of Rs.4,10,017/-; the assessment of monthly loss at Rs.1,500/- was perverse; relying on Pranay Sethi and Sarla Verma, the deceased being 45 years old and self-employed, 25% addition towards future prospects should be allowed, multiplier of 13 applied, and conventional heads granted at Rs.70,000/-.
Respondent no.2 contended that the accident occurred due to rash and negligent driving; the insurer was not liable because the driver did not possess a valid driving licence and the insured committed breach of policy; the award granted by the Tribunal was adequate as the source of income from the liquor business remained intact after the licence was transferred to the widow.
Judgment Excerpts
the Tribunal has partly allowed the claim petition and awarded the compensation of Rs.1,87,000/- (inclusive of N.F.L.)
the licence to run the liquor shop found to be renewed in the name of claimant no.1 after the death of deceased Rameshlal. As such the source of income from the business run by deceased remained to be intact.
the net income of the deceased being Rs.88,180/- no deduction to be made from said income
the deceased being self employed person in the age group of 40 to 50, the income to the extent of 25% to be added to the existing income of the deceased towards future prospects
Procedural History
Claim petition MACP No.822/2000 filed before Motor Accident Claims Tribunal, Ahmednagar under Section 166 of the Motor Vehicles Act, 1988. The Tribunal passed award on 16.08.2004 granting Rs.1,87,000/-. The appellants preferred First Appeal No.1376 of 2004 before the High Court of Judicature at Bombay, Aurangabad Bench seeking enhancement. Arguments were heard and judgment reserved on 07.02.2020, pronounced on 24.07.2020 (incomplete text).
Acts & Sections
- Motor Vehicles Act, 1988: Section 166
