2. Facts
• On 20.5.2012 at about 7.00 p.m. Dilip
Bhowmik was returning from Kathaltali to
his house by driving his vehicle bearing.
• When he reached near the bridge of
Agartala Railway Station situated on the
bye-pass under Amtali police station,
3. Cont….
• he met with an accident and sustained
grievous injuries on his person.
• He was initially rushed to Dr. B.R.
Ambedkar Memorial Teaching Hospital,
Hapania.
• Thereafter, he was referred to AGMC and
GBP hospital, Agartala, where he was
declared dead.
• At the time of the accident he was aged 43
years
4. Cont…
• The first respondent is the mother of
deceased Dilip Bhowmik.
• The second respondent is his wife and
respondent Nos. 3 and 4 are his
children
• They filed a claim petition seeking
compensation amounting to
Rs.68,15,000/-.
5. Cont…
• The claim petition was opposed by the
appellant-insurer.
• The Tribunal passed an award granting
total compensation in a sum of Rs.
10,57,800/-.
6. appellant challenged
• contending that the deceased himself was
the owner-cum driver of the offending
vehicle.
• He was not a third party within the meaning
of the Motor Vehicles Act, 1988
• The accident had occurred due to the
negligence of the deceased.
• Therefore, the appellant, being insurer of
the vehicle, was not liable to pay the
compensation.
7. Cont….
• The High Court accepted
• the contention of the appellant
• that the deceased was not a third party
• and that the accident had occurred due to
the rash and negligent driving of the
offending vehicle.
• However, the High Court directed the
appellant to pay the compensation with a
rider that the said order shall not be treated
as a precedent.
8. Cont…
• On perusal of the policy of the
insurance,
• the High Court in the course of the
order
• observed that indemnification
extended to personal accident of the
owner-cum-driver was limited to the
extent of Rs.2,00,000/-
9. Before SC….
• Learned counsel for the appellant
• has contended that the deceased himself was
driving the offending vehicle
• and has caused the accident.
• No other vehicle was involved in the accident.
• He cannot be treated as a third party.
• Therefore, the High Court has rightly held that the
claim petition filed by the respondents was not
maintainable.
10. on the other hand…
• In view of this finding,
• the High Court was not justified in
directing the appellant to pay the
compensation
11. Observed….
• It is an admitted position that the deceased was
the owner-cum-driver of the vehicle in question.
• The accident had occurred due to the rash and
negligent driving of the vehicle by the deceased
• No other vehicle was involved in the accident.
• The deceased himself was responsible for the
accident.
• The deceased being the owner of the offending
vehicle was not a third party within the meaning of
the Act.
12. Cont…
• The deceased was the victim of his own
action of rash and negligent driving.
• cannot maintain a claim on the basis of his
own fault or negligence and
• argue that even when he himself may
have caused the accident on account of
his own rash and negligent driving,
• he can nevertheless make the insurance
company to pay for the same
13. Finally….
• Therefore,
• the High Court was not justified
• in directing the appellant/insurer
• to pay the compensation determined by the
Tribunal
• since the indemnification extended to
personal accident of the deceased is
limited to Rs. 2,00,000/- under the contract
of insurance, the respondents are entitled
for the said amount towards compensation.
14. 1972...
51 Report of the Law Commission
………..on compensation for injury
caused
…………….by automobiles in hit-
and--run cases.
15. Just compensation
• In India……..a different culture.
• Here, every parent thinks that it is his
moral and legal duty to give fullest
education to his children.
• Parents think that marriage of their
children is their responsibility
• and even providing a house to their
children and grand children is their
responsibility.
16. Cont…
• The concept of culture and family life is totally
distinct from the culture and family life in
England and in other foreign countries.
• Here, parents not only educate the children
but spend huge amounts or at least sufficient
amounts on the marriages of their children,
on their education,
• …….for their housing needs and in majority
of cases in return they are looked after in old
ages
17. Cont…..
• Most of the people work even after their
retirement to support their children.
• The longevity of life in India has increase
at least up to 69 years; in many cases,
peoples live longer than that.
• The salaries and cost of things increase
rapidly.
• At a glance, between every 9-10 years
they double.
18. Cont…..
• Though the method of multiplier is one of the
best methods in providing compensation
while choosing the multiplier the court/tribunal
has to take into consideration the rising
inflation, increasing salaries and increasing
cost of living.
• Therefore, …….. have to determine just
compensation keeping in view the Indian
background, the Indian culture, the Indian
legal background, and the socio-cultural
circumstances existing in India.
19. (2009)6 SCC 121
Smt. Sarla Verma and Ors.
Vs.
Delhi Transport Corporation and
Anr.
20. Ratio Decidendi:
• "Where the deceased was self - employed or
was on fixed salary
• the Courts will usually take only the actual
income at the time of death
• and future revisions should not be considered
while determining the compensation.“
• "The percentage of deduction on account
personal and living expenses can certainly vary
with reference to the number of dependant
members in the family."
22. ?????
• Basically only three facts need to be
established by the claimants
• for assessing compensation in the case of
death
23. Cont....
o the loss has to be ascertained by first
determining the monthly income of the
deceased,
o then deducting there from the amount spent on
the deceased,
o and thus assessing the loss to the dependents
of the deceased.
o The annual dependency assessed in this
manner is then to be multiplied by the use of an
appropriate multiplier.
24. Step 1
The income of the deceased per annum should
be determined.
Out of the said income a deduction should be
made in regard to the amount which the
deceased would have spent on himself by way
of personal and living expenses.
The balance, which is considered to be the
contribution to the dependant family, constitutes
the multiplicand.
25. Step 2
• Having regard to the age of the deceased
• and period of active career,
• the appropriate multiplier should be selected.
• This does not mean ascertaining the number of
years he would have lived or worked but for the
accident.
26. Final....
• The annual contribution to the family
when multiplied by such multiplier gives
the 'loss of dependency' to the family.
28. Facts..
• Due to accident involving a goods vehicle and a
lorry, two persons died and others received
injuries.
• In respect to the claim filed by dependents and
legal representatives of deceased Hanumanth,
• the Tribunal allowed their claim and held them
entitled for compensation of Rs. 2,55,000/- from
the owner-cum-driver of the lorry, and also from
Respondent-Insurance Company as they were
held responsible jointly and severally.
29. Before High court
• The High Court in appeal
• ……..held that the Award was bad in law
because the deceased was in a clerical cadre
working as a Gumasthe
• …….accompanying the goods in transit for
the purpose of delivery
• and as such he could not be covered by the
clause under which premium was paid for
covering the risk of the persons employed in
connection with the operation of loading and
unloading of the goods.
30. Supreme court….
• The High Court has clearly fallen in error in
holding that the insurer is not liable in respect
of death of Hanumanth.
• The clause-"persons employed in connection
with the operation" is clearly over and above
the coverage provided by the policy to
"persons employed in connection with
loading/unloading of motor vehicle".
• As Gumasthe, the deceased was
accompanying the goods in transit for the
purpose of delivery of goods
31. Cont…
• This has been accepted by the High Court.
Obviously, as Gumasthe the deceased
would be covered by the expression
"persons employed in connection with
operation of motor vehicle" The operation
of the aforesaid clause has wrongly been
restricted and limited only to persons
employed in connection with
loading/unloading of the motor vehicle.
32. Finally….
• Insurance Company will be bound by the
Award made by the Tribunal for paying
compensation to the claimants for the
death of Hanumath as per orders of the
Tribunal.
37. National Commission….
• Ruled:
• “It can hardly be disputed that a mosquito
bite is something which no one expects
and which happens all of a sudden without
any act or omission on the part of the
victim…
• it is difficult for us to accept that the death
due to mosquito bite would not be death
due to an accident,” said Justice VK Jain
38. Facts….
It all began in 2012 ………when Mousumi
Bhattacharjee lost her husband, policy
holder
Debashish, a Kolkata resident, worked as
a manager in a tea factory in Mozambique.
He fell sick and was admitted to Nampula
Central Hospital where he died on 22.01.
2012.
The cause of death was malaria.
39. Cont…
Policy holder…….taken a housing loan under
a scheme started by the National Insurance
Company Limited (NICL) with the Bank of
Baroda.
This housing loan comes along with an
insurance policy. Loans were disbursed
under the “Bank of Baroda Home Loan
Suraksha Bima”.
He had paid a one-time premium for the sum
insured.
40. Respondent contention…
• But when Mousumi filed for the claim,
• …..NICL rejected it saying a mosquito bite
was not an accident and that malaria was
a disease.
• that “a mosquito bite is not an accident
under the said Suraksha Bima Policy
41. Cont…
nor does it fall under the definition of accident
that merits an insurance payout rather
mosquito bite causing malaria is an infection
and/or is a disease.
So, it is not liable to settle any claim against
the terms and conditions of the policy and the
perils”.
42. Next…
• Claim was not paid
• Dist. Forum: allowed the complaint
• State Forum: Insurer preferred an
Appeal….dismissed
• National Commission: Revision Petition by
Insurer
43. Court observed…
The term ‘accident’ has not been defined
in the policy which the deceased had
taken
and therefore contextual dictionary
meaning of the said term has to be taken
for the purpose of deciding
whether the death of the deceased was
due to an accident or not.
44. Cont…
• An accident is something that happens
unexpectedly and is not planned in
advance.
• It is defined as………..
• (i) an unpleasant event, especially in a
vehicle, that happens unexpectedly and
causes injury or damage,
• (ii) something that happens unexpectedly
and is not planned in advance
45. Acc to policy ….
• As per information available on the
website of the insurance company an
accident may include events like snake
bite, frost bite and dog bite.
• It is difficult to accept that the death due to
mosquito bite would not be death due to
an accident.
• Insurer is liable.
46. Before S.C....
Question
• The Court is tasked with determining
whether a death due to malaria
occasioned by a mosquito bite in
Mozambique, constituted a death due to
accident?
47. Observed.....
• The submission is that being bitten by a
mosquito is an unforeseen eventuality and
should be regarded as an accident.
• …….. do not agree with this submission. The
insured was based in Mozambique.
• According to the World Health Organization’s
World Malaria Report 2018, Mozambique,
with a population of 29.6 million people,
accounts for 5% of cases of malaria globally.
48. ......
• It is also on record that one out of three
people in Mozambique is afflicted with
malaria.
• In light of these statistics, the illness of
encephalitis malaria through a mosquito
bite cannot be considered as an accident.
• It was neither unexpected nor unforeseen.
• It was not a peril insured against in the
policy of accident insurance.
49. SC Order
• interpretation placed on the terms of the
insurance policy was manifestly incorrect
and that the impugned order of the
National Commission is unsustainable.
• It was not a peril insured against in the
policy of accident insurance.
• The appeal is allowed and
• the impugned judgment and order of the
National Commission shall stand set aside
51. Motor insurance
• Insurance : Insurance is the pooling of premium and sharing of
losses.
• Insurer : The party to an insurance arrangement who under
takes to indemnify for losses.
• Insured: A person whose interests are protected by an insurance
policy.
• Premium: Financial cost of obtaining
an insurance cover, paid as a lump sum.
• Policy: Written contract or certificate of insurance
51
52. Motor insurance
• Utmost Good Faith
•Insurable Interest
•Principle of Indemnity
•Principle of Contribution
•Principle of Subrogation
•Principle of ‘CAUSA PROXIMA’
united india ins.co.ltd.
bn
52
Principles of Insurance
54. Motor insurance
Motor insurance provides mainly two types of
policies :
a. Liability only or Act only or TP policy
b. Package or Comprehensive Policy
55. Motor insurance
Liability cover :
• Third party death or bodily injury.
• Third party property damage.
• Personal Accident cover to owner/
driver death.
• Personal accident cover to owner/
driver injury.
55
56. Motor insurance
• Comprehensive policy includes & covers:
a. Fire, Explosion, Self ignition, Lightening.
b. Burglary, housebreaking or
theft.
c. By riot and strike.
d. By Earthquake.
56
57. Cont…
e. By flood, typhoon, hurricane, storm,
tempest, inundation, cyclone, hail
storm, frost.
f. By accidental external means.
g. By malicious act.
h. By terrorist activity.
i. While in transit by road, rail, inland water
way, lift, elevator or air.
58. Motor insurance
Exclusions :
• Contractual liability.
• War perils nuclear perils .
• Consequential loss, Depreciation ,Wear and
tear mechanical or electrical break down.
• Damage suffered due to driving the vehicle
under the influence of intoxicating liquor or
drugs.
united india ins.co.ltd.
bn
58
59. Cont..
• ………arising outside the geographical
area specified in the policy.
• Claims arising whilst the vehicle is used in
contravention of the limitations as to use.
• Claims arising when the vehicle is driven
by a person without valid driving license
64. Motor….
• Protection of…
• Loss of damage…….by an accident or
loss by theft
• Risk of liability…
• That arises…..when it hurts….some body
65. Loss of motor car
o Means…..loss to the owner of the car
o Case: Eisinger v GALF (1925) ALL E R
o The owner sold his car
o Received cheque for its price
o Cheque was not encashed
o He claimed indemnity……insurer….
66. ?????
• ………for the loss of the car
• Company rejected….
• Filed case……
• Court held that…..
• Loss is only the loss of the sale proceeds
• And not the loss of the car
• So, insurer….not liable
67. No fault liability
• S. 140 of M.V Act
• Liability to pay compensation in certain
cases on the principle of no fault.-
• Where death or permanent disablement
of any person has resulted from an
accident arising out of the use of a motor
vehicle or motor vehicles,
• the owner of the vehicle shall,
• or, as the case may be,
68. Cont…
• the owners of the vehicles shall, jointly
and severally,
• be liable to pay compensation in
respect of such death or disablement in
accordance with the provisions of this
section.
• S. 140 to S. 144 correspond to sections
92A to 92E of the old act and provide
for liability without fault.
69. Hit & Run
• The Maharashtra government moved the
Supreme Court
• challenging Bollywood star Salman Khan's
acquittal by the Bombay High Court
• hit-and-run case filed
• Toyota Land Cruiser ran over five men sleeping
outside American Express bakery in Mumbai's
Bandra locality.
• Khan was convicted in May 2015 by a trial
court of killing one man on the night of 28
September, 2002.
70. Cont...
• The High Court shot down the trial court's
ruling
• acquitted Khan of all charges and
scrapped his five-year jail term.
• The high court said that
• .........the prosecution was not able to
sufficiently establish that the 49-year-old
star was behind the wheel that night or
was drunk at the time of the accident.
71. Cont...
• The sessions court had convicted Salman
Khan
• under section 304 (ii)
• and section 338 of the Indian Penal Code,
• for charges relating to culpable homicide not
amounting to murder
• and causing grievous hurt.
72. H.C
• The appeal is allowed and the
decision of the trial court is quashed
and set aside. Salman Khan is
acquitted of all charges," Justice Joshi
said.
• The court has set aside his sentence
of imprisonment for five years.
73. What ground
• "This court has come to the
conclusion that
• the prosecution has failed to bring
material on record to establish
beyond reasonable doubt
• that the appellant (Salman Khan)
was driving and was under the
influence of alcohol,".
74. Cont....
• Section 161 of Motor Vehicles Act where
a “hit and run motor accident” is defined
• as an accident arising out of the use of a
motor vehicle or motor vehicles
• the identity whereof cannot be
ascertained in spite of reasonable efforts
for the purpose.
• This Scheme came into force from
1.10.1982.
75. Cont...
• This Section provides for payment of compensation
(solatium) as follows:
• In respect of the death of any person resulting from
a hit and run motor accident,
• now a fixed sum of Rs.25,000
• In respect of grievous hurt to any person resulting
from a hit and run motor accident,
• now a fixed sum of Rs.12,500
77. Principle…
• the insurer had to indemnify the
compensation amount payable to the
third party
• and the Insurance Company may
recover the same from the insured.
79. Examined….
• ……..the liability of the Insurance
Company in cases of
• breach of policy condition
• due to disqualifications of the driver or
• invalid driving licence of the driver
• and held that in case of third party risks,
the insurer has to indemnify the
compensation amount to the third party
and the Insurance Company may
recover the same from the insured.
80. Guidelines…
• Chapter XI of the Motor Vehicles Act,
1988 providing compulsory
Insurance of vehicles against third-
party risks
• a social welfare legislation
• to extend relief by compensation to
victims of accidents
• caused by use of motor vehicles.
81. Cont…
• The breach of policy condition
• e.g. disqualification of the driver
• or invalid driving licence of the driver,
as contained in sub-section (2)(a)(ii) of
Section 149,
• has to be proved to have been
committed by the insured for avoiding
liability by the insurer
82. Cont…
• Mere absence, fake or invalid driving licence or
disqualification of the driver for driving at the
relevant time, are not in themselves defences
available to the insurer against either the insured or
the third parties.
• To avoid its liability towards the insured, the insurer
has to prove that the insured was guilty of
negligence and failed to exercise reasonable care
in the matter of fulfilling the condition of the policy
regarding use of vehicles by a duly licensed driver
or one who was not disqualified to drive at the
relevant time.
83. Cont…
• Insurance companies, with a view to
avoid their liability
• must not only establish the available
defence raised in the said
proceedings
• but must also establish “breach” on
the part of the owner of the vehicle;
• the burden of proof wherefore would
be on them.
84. Cont….
• The court cannot lay down any criteria as
to how the said burden would be
discharged, inasmuch as the same would
depend upon the facts and circumstances
of each case.
• The Tribunals in interpreting the policy
conditions would apply “the rule of main
purpose” and the concept of “fundamental
breach” to allow defences available to the
insurer under Section 149(2) of the Act.
85. Cont….
• If a vehicle at the time of accident was driven
by a person having a learner’s licence, the
Insurance companies would be liable to satisfy
the decree.
• onus is always upon the Insurance Company to
prove that the driver had no valid driving licence
and that there was breach of policy conditions.
Where the driver did not possess the valid
driving licence and there are breach of policy
conditions, “pay and recover” can be ordered in
case of third party risks.
******
86. Limitation
• No application for compensation shall be
entertained
• unless it is made within six months of the
occurrence of the accident.
• Appeal
• An appeal against the order of the Claims Tribunal
lies to the High Court and may be filed within
ninety days from the date of the award.
• No appeal shall lie against an award if the amount
in dispute in the appeal is less than 10,000 rupees.
87. Under s.140
• The amount of compensation
• shall be payable in respect of the death of
any person shall be fixed sum of Rs.
50,000/-
• and in respect of permanent disablement
shall be a fixed sum of Rs. 25,000/-.
88. Jurisdiction ........
Every application shall be made, at the
option of the claimant,
To the Claims Tribunal
having jurisdiction over the area in which the
accident occurred or
To the Claims Tribunal
within the local limits of whose jurisdiction the
claimant resides or carries on business or
Within the local limits of whose jurisdiction
the defendant resides.
90. Facts…
• Claimant son……..who is working as a school
teacher….. hit by Bus (insured with the Respondent
company) at Hoogly, in the State of West Bengal
and died.
• He was travelling on motor cycle of his colleague as
a pillion rider.
• ………..filed an application under Section 166 of the
Motor Vehicles Act, 1988 for compensation before
the Tribunal at Kolkata.
91. Cont…
• Rash and negligent driving by the driver of
the bus having been established,
• the Tribunal, applying the multiplier of 13 on
account of age of the Appellant being 47
years,
• and taking into account the income of the
deceased and other relevant factors, fixed
compensation of Rs. 16,12,200
92. Before HC
• The Respondent company preferred an
appeal before the High Court against
award passed by Tribunal on the only
ground of lack of territorial jurisdiction of
the Tribunal.
• The objection …….that the accident took
place at Hoogly and the claimant resided
at Hoogly.
• Office of the Respondent being at Kolkata
did not attract jurisdiction of the Kolkata
Tribunal.
93. …..
• The High Court upheld the objection
of the Respondent and allowed the
appeal of the Respondent company
• and directed refund of the amount
deposited/paid, if any, to the
Respondent company.
94. S.C….
• the High Court was not justified in
setting aside the award of the Tribunal
• in absence of any failure of justice
even if there was merit in the plea of
lack of territorial jurisdiction.
• Moreover, the fact remained that the
insurance company which was the
main contesting Respondent had its
business at Kolkata.
95. Cont….
• The provision in question, in the present
case,
• is a benevolent provision for the victims of
accidents of negligent driving.
• The provision for territorial jurisdiction has
to be interpreted consistent with the object
of facilitating remedies for the victims of
accidents.
96. Finally...
• Hyper technical approach in such matters can
hardly be appreciated.
• There is no bar to a claim petition being filed at a
place where the insurance company, which is the
main contesting parties in such cases, has its
business.
• In such cases, there is no prejudice to any party.
There is no failure of justice.
• The High Court failed to notice the provision of
Section 21 of Code of Civil Procedure.
