Case Note & Summary
The case involves four first appeals filed by The New India Assurance Company Limited against common judgment and award dated 30.06.2006 passed by Motor Accident Claims Tribunal, Chandrapur in four claim petitions arising out of a motor vehicle accident that occurred on 20.04.2004. The accident involved a goods vehicle (tempo) bearing registration No. MH-34-B-3507 owned by Namdeo Butale. The vehicle was carrying several passengers as gratuitous passengers when it overturned near village Kothari, resulting in deaths of three persons: Pramod Lambade, Mohammad Karim Kureshi, and Sheikh Daut Sheikh, and injuries to Paikaji Lambade. The claimants, being dependents of the deceased and the injured, filed claim petitions under Section 166 of the Motor Vehicles Act, 1988. The Tribunal awarded compensation to the claimants, holding the insurer liable. The Insurance Company appealed, contending that the vehicle was a goods vehicle and the deceased were gratuitous passengers, hence the insurer is not liable. The court analyzed the evidence and found that the deceased were traveling as gratuitous passengers in a goods vehicle, which is not covered under the insurance policy unless additional premium is paid. The court held that the insurer is not liable to pay compensation, but following the principle of pay and recover, directed the insurer to pay the awarded amount and recover from the owner. The court also found contributory negligence on part of the deceased as they were traveling in a goods vehicle. The court reduced the notional income from Rs. 3,000 to Rs. 2,500 per month and modified the compensation amounts accordingly. The appeals were partly allowed.
Headnote
A) Motor Accident Claims - Gratuitous Passenger in Goods Vehicle - Liability of Insurer - The insurer is not liable to pay compensation for death of gratuitous passengers traveling in a goods vehicle as per Section 147 of the Motor Vehicles Act, 1988, unless additional premium is paid. However, the insurer may be directed to pay and recover from the owner. (Paras 10-15) B) Motor Accident Claims - Contributory Negligence - Deceased traveling in a goods vehicle as gratuitous passengers contributed to the accident by their own negligence. The Tribunal erred in not considering contributory negligence. (Paras 16-18) C) Motor Accident Claims - Quantum of Compensation - Multiplier and dependency calculation - The Tribunal correctly applied multiplier of 16 and deducted 1/3rd towards personal expenses. However, notional income of Rs. 3,000 per month for a labourer is on higher side; reduced to Rs. 2,500 per month. (Paras 19-22)
Issue of Consideration
Whether the Insurance Company is liable to pay compensation for death of gratuitous passengers traveling in a goods vehicle, and whether the claimants are entitled to compensation as determined by the Motor Accident Claims Tribunal.
Final Decision
Appeals partly allowed. The Insurance Company is directed to pay the awarded amount to the claimants and recover the same from the owner of the vehicle. The quantum of compensation is modified: in FA 357/2006, compensation reduced from Rs. 1,50,000 to Rs. 1,20,000; in FA 718/2006, compensation reduced from Rs. 2,50,000 to Rs. 2,00,000; in FA 727/2006, compensation reduced from Rs. 2,50,000 to Rs. 2,00,000; in FA 729/2006, compensation reduced from Rs. 1,50,000 to Rs. 1,20,000.
Law Points
- Motor Vehicles Act
- 1988
- Section 147
- Section 149
- Section 166
- contributory negligence
- gratuitous passenger in goods vehicle
- breach of policy condition
- insurer's liability
- quantum of compensation
