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United India Insurance Company Limited v. Smt. Hargian Devi & Ors - FAO-371-1988 [2006] RD-P&H 4692 (24 July 2006)


F.A.O. NO. 371 OF 1988

DATE OF DECISION: August 02, 2006

Parties Name

United India Insurance Company Limited



Smt. Hargian Devi and others


PRESENT: Mr. N.K. Khosla,

Advocate, for the appellant- Company

Mr. L.M.Suri, Senior Advocate, with

Mr. Neeraj Khanna, Advocate, for respondents No. 1 to 3.

Mr. O.P.Goyal, Senior Advocate, with

Mr. Parmodh Goyal, Advocate, for appellant in FAO No. 269 of 1988



This judgment will dispose of F.A.O. No. 371 of 1988, filed by United India Insurance Company, F.A.O. No. 269 of 1988, filed by the alleged owner, and also Cross-objections No. 54-CII of 1988, filed by the claimants, as all these arise out of one and the same judgment passed by Motor Accident Claims Tribunal, Hisar (for short the Tribunal). For facility of dictating judgment, facts are being taken from F.A.O. No. 371 of 1988.

Accident, which took place, on the night intervening 3rd and 4th

April, 1986, and death of Sat Narain in that accident are not in dispute.

Primary dispute is only as to which party is liable to make payment of compensation and how much? As per admitted facts, Sat Narain deceased was driving truck bearing registration No. HRJ 4311 and was going from Hisar to Jind. His truck met with an accident with another truck bearing registration No. HRH 4301, which was being driven by Subash, respondent No. 4 in this appeal. The Tribunal, on appraisal of evidence, has come to a conclusion that respondent No. 4 was responsible for causing that accident, during trial his negligence was proved on record. Nothing has been said in that regard by counsel for the parties.

Originally the offending vehicle No. HRH 4301 was registered in the name of M/s Minaxi Gram Floor Mills, Hisar, of which Karan Pal Gupta, appellant in F.A.O. No. 269 of 1988 was the partner. At the time of accident, admittedly, he had purchased that truck from the Firm but no entry to that effect was made in the registration certificate. Objection was raised by the Insurance Company that as the offending vehicle was transferred not in terms of the provisions of the Motor Vehicles Act, no entry was made in the registration certificate and also no intimation was given to the Insurance Company, so it was not liable to pay the compensation amount. It was further contention of the Insurance Company that in view of the transfer of the vehicle, the Insurance policy had lapsed and there was no subsisting contract between the Insurance Company and the transferee of the vehicle, Shri Karan Pal Gupta. That contention was negatived by the Tribunal.

Same objection has been raised before this Court also. Counsel for respondents No. 1 to 3 and also claimants in Cross-objections refuted the argument s, raised by counsel for the Insurance Company.

Counsel for the respondents has placed reliance upon judgment of the Hon'ble Supreme Court in United India Insurance Co. Ltd. Shimla v.

Tilak Singh and others, 2006(3) R.C.R. (Civil) 168 (Supreme Court), in support of his contention that even if vehicle, which was insured, has been transferred and no intimation has been sent to the Insurance Company and further that no entry has been made in the registration certificate, even then the Insurance Company is liable to make payment of the compensation. The ratio of the judgment, referred to above, fully supports the contention, raised by counsel for the claimants- respondents. The Hon'ble Supreme Court, while analysing similar situation in the above said judgment, held as under: "Thus, in our view, the situation in law which arises from the failure of the transferor to notify the insurer of the fact of transfer of ownership of the insured vehicle is no different, whether under Section 103-A of the 1939 Act or under Section 157 of the 1988 Act in so far as the liability towards a third party is concerned.

Similar view was also expressed by Hon'ble the Supreme Court in G. Govindan v. New India Assurance Co. Ltd. And others, AIR 1999 Supreme Court 1398, Rikhi Ram and another v. Smt. Sukhrania and others, AIR 2003 Supreme Court 1446.

In view of the ratio of the judgments, referred to above, this Court feels that this appeal, filed by the Insurance Company, has no substance and is liable to be dismissed.

Counsel for the cross-objectors claimants agreed that the claimants are entitled to get the enhanced compensation. It is apparent from the records that the deceased was owner of a tractor, a truck and also having about 11 Acres of land. He was supervising the cultivation and also driving the truck and the tractor, as the need may be. The claimants are his widow and two children. On account of loss of supervision in cultivation of land, loss of the family has been assessed at Rs. 540/- per month and similarly loss towards income from the truck and the tractor has been assessed at Rs. 800/- per month and thereafter deduction of 1/3rd amount has

been made on account of personal expenses of the deceased. This Court feels that as the children were not grown up, it cannot be presumed that the deceased would have been spending 1/3rd

amount on himself. A cut of 1/4th

in the income as personal expenditure of the deceased will meet the ends of justice and as such dependency of the family would come to Rs. 1005/- per month. Multiplier of 16 has been applied by the Tribunal. This Court is of the view that the same is perfectly justified. After calculation, the total amount of compensation would come to Rs. 1,92,960/-.

In view of facts, mentioned above, the claimants are held entitled to get compensation amount of Rs. 1,92,960/- along with interest at the rate of 10% per annum from the date of filing the claim petition till realization of the amount. Subash, Driver of the vehicle, its owner Shri Karan Pal Gupta and United India Insurance Company are held liable to make payment of the compensation amount jointly and severally. Insurance policy is on record. No extra premium has been charged by the Company and as such liability of the Insurance Company would be limited to the statutory amount of Rs. 1,50,000/-(one lakh and fifty thousand) plus interest on that amount. Rest of the amount shall be paid by the owner and driver of the offending vehicle. However, the claimants shall be entitled to recover the whole amount of compensation from the appellant Insurance Company, which shall be entitled to recover the amount over and above Rs.

1,50,000/- and interest thereon from Subhash, driver, respondent No. 4 and Karanpal Gupta, owner, appellant in FAO No. 269 of 1988.

With above mentioned modifications, these appeals and the Cross-objections stand disposed of.

August 02, 2006. ( Jasbir Singh )

DKC Judge


Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites


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