FAO-77-2005 (O&M) -1- 273 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO-77-2005 (O&M) Date of Decision: 27.07.2026 NEW INDIA ASSURANCE CO.LTD. .....APPELLANT VERSUS PUSHPA GAUTAM ETC. .....RESPONDENTS CORAM: HON'BLE MR. JUSTICE YASHVIR SINGH RATHOR Present: Mr. Siddheshwar Hans, Advocate and Ms. Veena Ashwani Talwar, Advocate for appellant/Insurance Company. Mr. Hitesh Verma, Advocate/Amicus Curiae for the claimants/respondents No.1 to 3. Respondents No.4 and 5 ex parte. ***** YASHVIR SINGH RATHOR , J. (Oral) 1. The matter is being taken up in the post lunch session. 2. This appeal has been instituted by the Insurance Company against the Award dated 09.11.2004 decided by MACT, Sonipat (for short “Tribunal”) in MACT Case No.173 of 2003 in a petition under Section 163-A/166 of Motor Vehicles Act, 1988 (for short ‘Act) vide which a sum of Rs.5,50,000/- has been awarded as compensation to claimants (respondents No.1 to 3 in the present appeal) on account of death of Rup Singh Gautam, along with interest @ 9% per annum from the date of filing of the claim petition till realization in a motor vehicular accident which took place due to rash and negligent driving on the part of respondent No.2 (respondent No.5 in the present appeal) while driving VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -2- the Three Wheeler bearing No.HR-69-1543 (for short ‘offending vehicle’), owned by respondent No.1 (respondent No.4 in the present appeal), which was insured with respondent No.3 (appellant in the present appeal) and Insurance Company has been held liable to pay the compensation to the claimants along with respondents No.1/owner and 2/driver of the offending vehicle, jointly and severally. 3. From the pleadings of parties, following issues were framed by the learned Tribunal:- “1. Whether Rup Singh died as a result of rash and negligent driving of the vehicle in question by respondent No.1 as alleged? OPP 2. Whether the petitioners are entitled to compensation if so and from whom? OPP 3. Whether respondent No.2 was not duly licensed driver if so to what effect? OPR 4. Relief.” 4. Thereafter, the parties led evidence in support of their case. 5. After hearing the parties and going through the material on the file, learned Tribunal awarded a sum of Rs.5,50,000/- as compensation to the claimants along with interest @ 9% per annum from the date of filing of claim petition till realization, payable by respondents No.1 to 3 jointly and severally. 6. Feeling aggrieved, the appeal in hand has been preferred by the Insurance Company. The material on file has been perused and parties have been heard. 7. Learned counsel for the Insurance Company argued that the VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -3- Tribunal has gravely erred by fastening liability upon the Insurance Company and exonerating the insured of its liability from paying the compensation amount. Learned counsel further argued that the insured has violated the terms and conditions of the insurance policy by plying the auto-rickshaw outside the municipal area whereas, as per the permit produced on file, the auto-rickshaw could have been plied within the municipal area. In the present case, the accident had taken place at Biswan Mile, GT Road which was outside the jurisdiction of the municipal area and since offending vehicle was being plied outside the area of validity of the permit, it was a breach of terms and conditions of the insurance policy by the insured and Insurance Company is thus not liable to be indemnify the owner/insured and he prayed that Insurance Company be exonerated of its liability to indemnify the insured. Learned counsel further prayed that excessive compensation has also been awarded to the claimants which is also liable to be reduced. 8. On the other hand, learned counsel/amicus curiae for respondents No.1 to 3 argued that inadequate compensation has been awarded by the Tribunal. Learned counsel next contended that income of the deceased has been assessed on lower side and that future prospects have also not been added to the monthly income of the deceased contrary to settled provisions of law who was in permanent employment. Learned counsel next contended that no compensation has been paid under conventional heads i.e. loss of consortium, loss of estate and funeral expenses and he prayed that compensation be awarded under all the heads and same be suitably enhanced. Learned counsel next contended VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -4- that claimants/respondents No.1 to 3 have not filed any appeal against the impugned award for enhancement of compensation but this Court can still enhanced the compensation and award just compensation which is statutory duty of the Court. In support of his contentions, learned counsel has relied upon 2009(6) SCC 121 Sarla Verma and others Vs. Delhi Transport Corporation and Another, 2017 (16) SCC 680 National Insurance Co. Ltd Vs. Pranay Sethi and Other, 2018 (4) R.C.R. (Civil) 333, ‘Magma General Insurance Co. Ltd. v. Nanu Ram alias Chuhru Ram & Others and (2021) 11 SCC 780, United India Insurance Co. Ltd. Vs. Satinder Kaur and judgment of a Co-ordinate Bench of this Court in Law Finder Doc ID #2884320, United India Insurance Co. Ltd. Vs. Taraqqi Lal (Since Deceased) and others. 9. At the very outset, it is pertinent to mention that the record of the present appeal and the Tribunal has got burnt in a fire incident in the High Court Registry and the present appeal has to be decided on the basis of the facts and evidence discussed by the Tribunal in the impugned award. 10. First point is to determined as to whether there is violation of terms and conditions of insurance policy by the insured or not. While giving finding on issue No.3, the Tribunal has held as under:- “17. Jaipal respondent no.2 appearing in the witness box as RW-1 has produced photo copy of the driving licence Ex-R1 and from the statement of Prem Singh Licence Clerk RW-2, this licence is not proved fake or fictitious in any manner. VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -5- Thus, insurance company cannot escape its liability. No doubt, Prem Singh Licence Clerk RW-2 in his statement has stated that as per record Anil respondent no.1 was holding permit of vehicle No. HR-69-1543 and route area has been shown as municipal area only. This permit was issued on 11.10.2002 and 9.10.2007. But on this ground, in my considered opinion, insurance company cannot escape its liability. Hence, this issue is decided against the insurance company and in favour of the petitioners and respondent no.1.” 11. A perusal of the aforesaid reasoning given by the Tribunal shows that driver possessed a valid and effective driving licence and Insurance Company failed to establish that the licence was fake or invalid. Besides this, RW2 has further stated that permit had been issued to ply the vehicle for carrying passenger for the period of 11.10.2002 to 09.10.2007 and a route area has been shown as municipal area only. As per contents of the award, the accident in question had taken place at Bus stand, GT Road, Biswan Mile. However, no evidence has been led by the Insurance Company to establish that the place of accident was not within the municipal area or that offending vehicle was being plied outside the area of its validity. To prove this fact, the Insurance Company should have summoned the record from the Municipal Committee, Sonipat to prove the boundary limits of the Municipal Committee and in the absence of evidence to this effect, it cannot be assumed that the place where accident took place was outside the municipal limits. Best evidence in the possession of Insurance Company has been withheld for the reasons best VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -6- known to it and on this account, an adverse inference has to be drawn against the Insurance Company that had the Insurance Company led this evidence, it would not have supported its version. Resultantly, there is no reason to interfere with the findings on issue No.3 and the same is accordingly affirmed. 12. The next point to be decided is as to whether this Court while deciding an appeal instituted by the Insurance Company against the award of compensation can enhance the compensation without any appeal or cross-objections having been filed by the claimants. The answer to this question is certainly in the affirmative. A Co-ordinate Bench of this Court in Taraqqi Lal’s case (supra), while placing reliance upon the judgment of the Hon’ble Supreme Court in (2021) 16 SCC 467, Surekha and Ors. Vs. Santosh and Ors., has held that the Appellate Court has jurisdiction to enhance compensation even when claimant has not filed cross-appeal or cross-objections as assessment of just compensation is the statutory duty of the court and procedural technicalities cannot deprive claimant of his legitimate entitlement. In Surekha Vs. Santosh’s case (supra), High Court of Judicature at Bombay while deciding the appeal filed by the Insurance Company had held that compensation amount payable to claimants ought to have been Rs.49,85,376/- but declined to grant enhancement merely on the ground that claimants/appellants had failed to file cross-appeal. However, Hon’ble Supreme Court held that in the matter of insurance claim compensation in reference to the motor accident cases, the courts should not take hypertechnical approach and should ensure that just compensation is awarded to the affected person or VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -7- the claimants and awarded the enhanced compensation as assessed by Bombay High Court. As such, it is held that compensation can be reassessed by this Court without any appeal having been filed by the claimants. 13. Next point is to be decided as to how much compensation should be awarded to the claimants. The term `just compensation’ has been elaborated by Hon’ble Supreme Court in 2009(1) RCR (Civil) 867 (SC), Syed Basheer Ahamed and Others Vs. Mohd. Jameel and Another, and it has been held that while assessing compensation in a motor accident claims case, the Tribunal should award compensation which appears to be just. The expression “which appears to be just” vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of compensation. It has been further held that although the Act is a beneficial legislation, it can neither be allowed to be used as a source of profit, nor as a windfall to the persons affected nor should it be punitive to the persons liable to pay compensation and that determination of compensation must be based on certain data establishing reasonable nexus between the loss incurred by the victim or dependents. It has been further held that misplaced sympathy, generosity and benevolence cannot be the guiding factors for determining the compensation. As such, compensation is required to be assessed by taking into consideration above-said parameters. 14. One of the claimants, namely, Pushpa Gautam wife of the VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -8- deceased stepped into the witness box as PW3 and deposed that her husband was Head Mali with Haryana Tourism Corporation Limited, Sonipat and was thus in Government service. PW2 K.C. Sharma, Accountant tendered the salary certificate of deceased Ex.P2 and deposed that he was drawing salary of Rs.5,462/- per month and his carry home salary was Rs.4,623/-. He deposed that age of the deceased was 40 years. However, the Tribunal took into consideration the carry home salary of the deceased while assessing the loss of dependency but a grave error has been committed while taking the carry home salary of Rs.4,623/- into consideration. The salary of deceased was Rs.5,462/- per month and some contributions made by him towards GPF and GIS could not have been deducted while assessing his monthly income as the same are the part of his savings. Accordingly, the income of the deceased is taken as Rs.5,462/- per month. 15. As per postmortem report Ex.P1, age of the deceased was 40-42 years and as such, deceased was above 40 years of age and 30% amount thus has to be added to the income of the deceased towards future prospects in view of law laid down in Pranay Sethi’s case (supra), which takes his income to Rs.7,100/- per month (Rs.5,462/- + Rs.1,638/-). 16. The petition was instituted before the Tribunal by wife and two sons of the deceased. Accordingly, it is held that deceased has left behind 3 dependents and 1/3 of the income thus has to be deducted towards personal and living expenses as per law laid down in Sarla Verma’s case (supra). After deducting a sum of Rs.2,366/- towards VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -9- personal expenses, the monthly loss of dependency comes out to Rs.4,734/- (Rs.7,100/- - Rs.2,366/-) and the annual loss of dependency comes out to Rs.56,808/-. 17. As per guidelines laid down in Sarla Verma’s case (supra), multiplier of 14 has to be applied as deceased was 40-42 years of age and after applying the same, the compensation comes to Rs.7,95,312/- (Rs.56,808/- X 14). 18. In addition to this, respondent No.1/claimant (wife of the deceased) is held entitled to a sum of Rs.70,000/- under conventional heads i.e. Rs.40,000/- towards loss of consortium, Rs.15,000/- towards loss of estate and Rs.15,000/- on account of funeral expenses, as per law laid down in Pranay Sethi’s case (supra). Likewise, respondents No.2 and 3/claimants who are sons of deceased are also held entitled to a sum of Rs.40,000/- each on account of loss of parental consortium, in view of law laid down in Nanu Ram’s case (supra) and Satinder Kaur’s case (supra), which takes the compensation to Rs.9,45,312/-. 19. Accordingly, the compensation to be awarded to the claimants/respondents No.1 to 3 is assessed as under:- S.No. Under Head Compensation assessed by this Court 1. Age of deceased 40-42 years 2. Monthly income of deceased Rs.5,462/- per month 3. Future prospects @ 30% Rs.1,638/- 4. Total income Rs.7,100/- per month 5. Number of dependents 3 VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -10- 6. Deduction towards personal expenses of the deceased (1/3rd) Rs.2,366/- 7. Monthly loss of dependency Rs.4,734/- 8. Annual loss of dependency Rs.56,808/- 9. Multiplier 14 10. Compensation on account of Loss of dependency Rs.7,95,312/- 11. Compensation under conventional heads to respondent No.1/wife Rs.70,000/- 12. Loss of parental consortium to respondents No.2 and 3/sons of the deceased Rs.80,000/- (Rs.40,000 X 2) Total Compensation Rs.9,45,312/- (rounded off to Rs.9,45,000/-) Interest 9% per annum 20. Resultantly, with the aforesaid modification in the Award regarding enhancement of compensation, the appeal filed by the Insurance Company stands dismissed. Claimants/respondents No.1 to 3 are held entitled to a sum of Rs.9,45,000/- as compensation. The enhanced compensation thus comes out to Rs.3,95,000/- (Rs.9,45,000/- – Rs.5,50,000/-) over and above the compensation awarded by the Tribunal alongwith interest at the rate of 9% per annum from the date of filing of claim petition i.e. 03.09.2003, till realization, payable by respondents No.1 to 3 i.e. driver, insured and insurer, jointly and severally. Out of the enhanced compensation, a sum of Rs.75,000/- each be paid to the claimant/respondents No.2 and 3-sons along with interest and remaining amount to claimant/respondent No.1-wife along with proportionate VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document FAO-77-2005 (O&M) -11- interest. 21. Registry is directed to email the authenticated copy of the award to the respondent Insurance Company in terms of directions issued by the Hon’ble Supreme Court in Writ Petition (Civil) No.534 of 2020 titled Bajaj Allianz General Insurance Company Versus Union of India and others, decided on 16.03.2021 and Insurance Company shall comply with the directions as issued under Clause (F) of the said judgment. 22. Since the claimants/respondents No.1 to 3 are represented before this Court through Amicus Curiae, copy of judgment be sent to successor Court of Shri B.L. Singal, MACT, Sonipat as well as Secretary-cum-CJM, DLSA, Sonipat who shall get the copy of this judgment communicated to the claimants as well as Sh. Harpal Arya, Advocate for petitioners who had instituted the claim petition, so that they can seek enhanced amount of compensation. 23. Pending misc. application (s), if any, shall also stand disposed of. (YASHVIR SINGH RATHOR) JUDGE 27.07.2026 Vishal Vardhan Whether speaking/reasoned Yes/No Whether reportable Yes/No VISHAL VARDHAN 2026.07.29 12:48 I attest to the accuracy and integrity of this document