The Manager, New India Assurance Co. Ltd. v. Velachi K.V. and others

## IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE J.B.KOSHY & THE HONOURABLE MR. JUSTICE K.P.BALACHANDRAN MONDAY, THE 22ND SEPTEMBER 2008 / 31ST BHADRA 1930 MACA.No. 753 of 2008 ------------------------------------ OPMV.8/2005 of MOTOR ACCIDENT CLAIMS TRIBUNAL, KASARAGOD .................... ## APPELLANT/3RD RESPONDENT: THE MANAGER, NEW INDIA ASSURANCE CO. LTD., SREEVALLI BUILDINGS, ANICODE, CHITTUR, PALAKKAD 678 101. BY ADV. SRI.RAJAN P.KALIYATH ## RESPONDENTS/PETITIONERS 1 TO 4: 1. VELACHI K.V., AGED 69 YEARS, W/O.M.KANNAN, KIZHAKKEVEETIL. ## 2. M.KANNAN AGED 75, S/O.LATE THURUMBAN. ## 3. REMANI.M., AGED 23, D/O.KANNAN, 4. RATHEESH M., AGED 21, S/O.M.KANNAN, ALL ARE RESIDING AT MANIYAT HOUSE, MOONKODE, PERUMBATTA POST, BHEEMANADY VILLAGE, HOSDURG TALUK, KASARAGOD DISTRICT. ## ADV. SRI.SURESH KUMAR KODOTH FOR R1 TO 4 THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD ON22/09/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: J.B.Koshy & K.P.Balachandran, JJ. --------------------------------- M.A.C.A.No.753 of 2008 --------------------------------- ## **JUDGMENT** Koshy, J. A thirty one year old youngster, an autorickshaw driver, sustained fatal injuries in a motor accident. A claim petition was filed under Section 163-A of the Motor Vehicles Act by his parents, sister and brother, claiming a total compensation of Rupees six lakhs. The Tribunal adopted the multiplier method as per the II schedule and awarded an amount of Rs.4,12,500/-. Only 5 can be taken as the multiplier considering the age of the parents. The Tribunal considered the age of the motor accident victim. The brother was 21 years old and sister was 23 years old. The contention of the Insurance Company is that since the deceased was unmarried, only the age of the claimants, especially the age of the parents, should have been taken for calculating the MACA 753/08 2 compensation. We are of the opinion that such a contention cannot be taken as the claim is under Section 163-A, which is a statutory liability. Even though many defects in the II schedule were pointed out, the schedule was not amended. In none of the decisions of the Apex Court, the schedule was set aside. As per Section 163-A read with II schedule for calculating the compensation in the case of death, multiplier method is not prescribed. Fixed amount is mentioned in the schedule. From the above amount, one third has to be deducted and the balance compensation has to be paid in the case of death and only in the case of permanent disability multiplier method has to be adopted. If the motor accident victim's age is between 30-35 years and the yearly income is Rs.36,000/-, the amount fixed in the schedule is Rs.5,76,000/-. One third has to be deducted and the balance will be Rs.3,84,000/-. Then general damages under item 3 has to be added. If that is added, the total compensation payable MACA 753/08 3 will be 3,88,500/-. In this connection, we refer to the decision of th Honourable Supreme Court in **Deepal Girish Bhai Soni v. United India Insurance Co. Ltd., Baroda** ((2004) 5 SCC 385). The Honourable Supreme Court in the above case also noticed the differences between Sections 140 and 163-A because an award under Section 140 is only an interim measure and the claimants can claim full compensation under Section 166 with set off against the amount awarded under Section 140. But, a claimant cannot file a claim for compensation under Sections 163-A and 166 simultaneously. Both are independent claims and that should be looked into independently. Section 163-A deals with application for granting final award and not an award as an interim measure. The Supreme Court after considering the objects and reasons of the Motor Vehicles Amendment Act, 1994, which introduced Section 163-A held that Section 163-A was introduced in the Act by way of a social security MACA 753/08 4 scheme. It is a code by itself. It was also held that claims under Section 163-A can be filed only if the annual income is below Rs.40,000/-. At paragraph 42 it was held as follows: “42. chapter XI was, thus, enacted for grant of immediate relief to a section of people whose annual income is not more than Rs.40,000/- having regard to the fact that in terms of S.163-A of the Act read with the Second schedule appended thereto; compensation is to be paid on a structured formula not only having regard to the age of the victim and his income but also the other factors relevant therefor. An award made thereunder, therefore, shall be in full and final settlement of the claim as would appear from the different columns contained in the second schedule appended to the Act. The same is not interim in nature. The note MACA 753/08 5 appended to column 1 which deals with fatal accidents makes the position further more clear stating that from the total amount of compensation one third thereof is to be reduced in consideration of the expenses which the victim would have incurred towards maintaining himself had he been alive. This together with the other heads of compensation as contained in column Nos.2 to 6 thereof leaves no manner of doubt that the Parliament intended to lay a comprehensive scheme for the purpose of grant of adequate compensation to a section of victims who would require the amount of compensation without fighting any protracted litigation for proving that the accident occurred owing to negligence on the part of the driver of the motor vehicle or any other fault arising out of use of a motor vehicle.” MACA 753/08 6 At paragraph 46, the Honourable Supreme Court held as follows: ”46. S.163-A which has an overriding effect provides for special provisions as to payment of compensation on structured formula basis. Sub-s.(1) of S.163A contains non-obstante clause in terms whereof the owner of the motor vehicle or the authorised insurer is liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs of the victim, as the case may be, Sub-s.(2) of S.163-A is in pari matetria with Sub-s. (3) of S.140 of the Act.” Again, at paragraph 48, it was held that while granting compensation, the Tribunal is required to adjudicate only the question as regards the age and MACA 753/08 7 income, if disputed. At paragraph 51, it was held as follows: |“51. The scheme envisaged under|“51. The scheme envisaged under| |---|---| |S.163-A, in our opinion, leaves no|| |manner of doubt that by reason|| |thereof the rights and obligations|| |of the parties|are to be| |determined finally.|The amount of| |compensation payable under the|| |aforementioned provisions is not|| |to be altered or varied in any|| |other proceedings<br>.|It does not| |contain any provision providing|| |for set off against a higher|| |compensation unlike S.140. In|| |terms of the said|provision, a| |distinct and specified class of|| |citizens, namely, persons whose|| |income per annum is Rs.40,000/- or|| |less is covered thereunder whereas|| |Ss.140 and 166 cater to all|| |sections of society.”|| MACA 753/08 8 The above three member bench decision clearly shows that Section 163-A read with the second schedule is a complete machinery for awarding compensation. The object behind introduction of Section 163-A is to prevent long drawn out litigation and the statutorily provided formula cannot be altered by the Tribunal or court when claims are filed under Section 163-A, provided the annual income of the victim is below Rs.40,000/-. In this connection, we also refer to the decision of the Apex Court in ## **Bangalore Metropolitan Transport Corporation v.** **Sarojamma** ((2008) 5 SCC 142). In this case, the annual income assessed is only Rs.36,000/- and the compensation has to be calculated strictly as per the provisions of the Motor Vehicles Act and compensation payable will only be Rs.3,88,500/instead of Rs.4,12,500/-. The Tribunal has imposed 12% penal interest if the amount is not deposited within one month of the award. That part of the award is set aside. The amount of Rs.3,88,500/- MACA 753/08 9 should be deposited with 7.5% interest per annum from the date of application till its deposit after deducting the amount already deposited. On deposit of the amount, it can be disbursed as mentioned by the Tribunal. The appeal is partly allowed. **==> picture [186 x 13] intentionally omitted <==** 22[nd] September, 2008 **==> picture [253 x 12] intentionally omitted <==** tkv