1 2025:CGHC:40891 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR MAC No. 204 of 2018 Lachhindar S/o Late Bhimaram Aged About 36 Years R/o Bagheldipara Pakela, P.S. Sukma, Distt. Sukma (Chhattisgarh) --- Appellant Versus 1 - Sanjay Kumar Mourya S/o Budharu Ram Mourya R/o Village Kukanar, P.S. Kukanar, Distt. Sukma (Chhattisgarh) 2 - Rakesh Kumar S/o Shri Manuram R/o Village And Post Tongapal , P.S. Tongapal, Distt. Sukma (Chhattisgarh) 3 - The Branch Manager National Insurance Co. Ltd. Above Central Bank Of India, Near R.M.S. Office, Jagdalpur, Distt. Bastar (Chhattisgarh) --- Respondents MAC No. 1137 of 2018 Branch Manager National Insurance Company Limited Above Central Bank, Near R.M.S. Office Jagdalpur District Bastar Chhattisgarh, Through Authorised Signatory, National Insurance Company Limited Divisional Office Bilaspur Chhattisgarh. --- Appellant Versus 1 - Lachinder S/o Late Bhimaram Aged About 36 Years R/o Village- Baghel- Dipara Pakela Police Station Kukanar District- Sukma, Chhattisgarh 2 - Sanjay Kumar Mourya S/o Shri Budharu Ram Mourya R/o Village Kukanar, Police Station Kukanar District- Sukma, Chhattisgarh YOGESH TIWARI Digitally signed by YOGESH TIWARI Date: 2025.08.14 18:52:41 +0530 2 3 - Rakesh Kumar S/o Shri Manuram R/o Village And Post Tongpal, District- Sukma, Chhattisgarh ... Respondents (Cause-title taken from Case Information System) For Claimant : Mr. Praveen Dhurandhar, Advocate For Owner and Driver : None For Insurance Company : Mr. Asheesh Kumar Pandey, Advocate on behalf of Mr. B.N. Nande, Advocate Hon’ble Shri Amitendra Kishore Prasad, Judge Judgment on Board 13.08.2025 1. As both the appeals arise out of same accident and common question is involved in it, therefore, they are being disposed of by this common judgment. 2. Challenge in these appeals is to the award dated 09.08.2017 passed by the Additional Motor Accident Claims Tribunal, Dantewada, District South Bastar Dantewada (C.G.) (hereinafter referred to as 'Claims Tribunal') in Claim Case No.42/2016 whereby learned Claims Tribunal allowed claim application in part filed by the claimant. 3. MAC No.204/2018 has been filed by the claimant for enhancement of amount of compensation awarded by the learned Claims Tribunal whereas MAC No.1137/2018 has been filed by the Insurance Company challenging the liability fastened upon it stating that according to the insurance policy (Ex.D/1), the 3 premium was not paid for occupant, as such, Insurance Company be exonerated to satisfy its liability. 4. Brief facts of the case, in a nutshell, are that, on 03.08.2009, Smt. Hiramati (since deceased) was going from village Pakela to Sukma on a Jeep bearing registration No.CG-04-B-3688 (for short, ‘offending vehicle’), at about 9.30 PM, the offending vehicle dashed with the tree on account of rash and negligent driving of non-applicant No.1, who was driver of the offending vehicle, due to which Smt. Hiramati died on the spot. 5. The claimant, who is son of the deceased filed an application under Section 166 of the Motor Vehicles Act, 1988 (for short, ‘M.V. Act’) seeking total compensation of Rs.16,74,000/- towards loss of life pleading therein that on the date of accident, deceased was aged about 45 years and earning Rs.6,000/- per month by doing agriculture work. 6. The non-applicant No.1 submitted reply to claim application and pleaded that offending vehicle was insured with the Insurance Company, as such, liability, if any, to satisfy the compensation would be upon the Insurance Company. 7. Non-applicant No.3/Insurance Company submitted reply to claim application, resisting the claim. It was further pleaded that on the date of accident, driver of the offending vehicle was not possessed with valid and effective licence, as such, there was 4 breach of policy conditions, hence, Insurance Company be exonerated from its liability. 8. On appreciation of pleadings, oral and documentary evidence brought on record by the respective parties, learned Claims Tribunal held that Smt. Hiramati died on account of motor accidental injures due to rash and negligent driving by the driver of the offending vehicle and awarded total compensation of Rs.3,72,000/- along with interest at the rate of 9% per annum from the date of filing of claim petition till its realization and fastened liability to satisfy the amount of compensation upon the driver, owner and Insurance Company jointly and severally. 9. Learned counsel for the claimant submits that learned Claims Tribunal has not assessed the income of deceased in appropriate manner. It is contended that learned Claims Tribunal erred in awarding meagre amount of compensation towards funeral expenses, loss of estate as well as loss of consortium and submits that amount of compensation be suitably enhanced. 10. Learned counsel for the Insurance Company submits that the impugned award passed by the learned Claims Tribunal is liable to be set aside as it is contrary to law and facts on record. It is urged that the Claims Tribunal has erroneously treated the occupant of the offending vehicle as a “third party” and fastened liability upon the Insurance Company, despite the fact that the policy in question is an Act Only Policy which does not provide 5 contractual coverage to gratuitous occupants. The fastening of unlimited liability in such circumstances is wholly misconceived and contrary to the settled position of law. It is further submitted that under the Act Only Policy, the insurer’s liability is restricted to the statutory limit of Rs.1,00,000/- only. The insured has not appeared before the Claims Tribunal nor produced any evidence to show payment of additional premium to extend coverage to the occupant of the vehicle. In absence of such contractual coverage, the Claims Tribunal could not have directed the appellant to satisfy the entire award. It is also contended that the quantum of compensation awarded by the Claims Tribunal is excessive and without proper basis. 11. I have heard and considered the submission advanced by the learned counsel for the respective parties and perused the record of the claim cases. 12. This Court has to first examine MAC No.204/2018 as to whether the compensation of Rs.3,72,000/- awarded by the Claims Tribunal is just and proper compensation in the given facts and circumstances of the case. 13. As regards income of the deceased, though the claimants have pleaded that the deceased was earning Rs.6,000/- per month by agriculture work, but no documentary evidence in support thereof has been adduced, but it cannot be said that the deceased was not earning anything from his work. Therefore, in absence of 6 reliable evidence, income of deceased is to be assessed on notional basis keeping in mind the nature of occupation, date of accident, wage structure prevailing on the date of accident, price index and cost of living etc. specially notification by Labour Department for minimum wages in the year 2013. Upon considering the aforementioned factors, the Claims Tribunal has rightly reckoned the income of the deceased as Rs.3,000/- per month i.e. Rs.36,000/- per annum. 14. The Learned Claims Tribunal erred in awarding 30% addition towards future prospects, contrary to the law laid down by the Hon’ble Supreme Court in National Insurance Company Ltd. v. Pranay Sethi and Others, (2017) 16 SCC 680, wherein it has been held that in the case of a deceased aged between 40-50 years and self-employed or unemployed, only 25% of the established income is to be added towards future prospects. In the present case, the deceased, being aged about 45 years and unemployed, was entitled to only 25% addition towards future prospects. Accordingly, taking the annual income of the deceased at Rs.36,000/-, the addition of 25% towards future prospects comes to Rs.9,000/- making the total annual income Rs.45,000/-, which ought to have been considered for the computation of compensation. 15. The deceased was aged about 45 years on the date of accident and she was one son i.e. the claimant, as such the deduction 7 towards personal and caring expenses would be 1/2, which is Rs.22,500/-. In view of judgment of the Hon’ble Supreme Court in Sarla Verma (Smt.) and others v. Delhi Transport Corporation and another, (2009) 6 SCC 121 and Pranay Sethi (supra) considering the age of the deceased, after applying multiplier of 14 as applied by learned Claims Tribunal, the total loss of income works out to Rs.3,15,000/-. The claimant is further entitled to Rs.15,000/- towards loss of estate and Rs.15,000/- towards funeral expenses according to Pranay Sethi (supra) and as per Magma General Insurance Company Limited v. Nanu Ram alias Chuhru Ram and others, (2018) 18 SCC 130, the claimant is further entitled for amount towards loss of consortium Rs.40,000/-. Further, 10% enhancement is every three years is also required to be given in respect of loss of estate, funeral expenses and consortium in view of the judgment rendered by Hon’ble Supreme Court in the matter of United India Insurance Co. Ltd. v. Satinder Kaur @ Satwinder Kaur, (2020) 11 SCC 1. 16. Thus, the claimant is entitled for compensation in the following manner:- Sl. No. Head Calculation Awarded amount 1. Income of deceased @ Rs. 3,000/- per month Rs.36,000/- per annum 2. 25% of (1) above to be added as future prospects 36,000 + 9,000 = Rs.45,000/- 3. 1/2 of (2) deducted as 45,000 – 22,500 = 8 personal expenses of the deceased Rs.22,500/- 4. Compensation after multiplier of 14 applied 22,500 x 14 Rs.3,15,000/- 5. Towards loss of estate 15,000 + 3,000 with increase of 10% in every three years Rs.18,000/- 6. Towards loss of consortium to the one claimant @ Rs. 40,000/- 40,000 + 8,000 = 48,000/- with increase of 10% in every three years Rs.48,000/- 7. Funeral Expenses 15,000 + 3,000 with increase of 10% in every three years Rs.18,000/- Total Compensation Awarded Rs.3,99,000/- 17. Thus, the total compensation is recomputed as Rs.3,99,000/-. After deducting Rs.3,72,000/- as awarded by the Claims Tribunal, the enhancement would be Rs.27,000/-. 18. In the result, the appeal filed by the claimant being MAC No.204/2018 is partly allowed. The claimant shall be entitled to Rs.27,000/- in addition to what is already awarded by the Claims Tribunal. The enhanced amount will carry interest @ 9% from the date of enhancement of the award till its realization. 19. Now, this Court has to examine the appeal filed by the Insurance Company being MAC No.1137/2018. 20. Learned counsel for the Insurance Company has assailed the 9 finding of the learned Claims Tribunal fastening liability upon it, submitting that the policy in question, Exhibit D/1, does not provide coverage for a gratuitous occupant of the offending vehicle. It is argued that the insurance policy is contractual in nature and the liability of the insurer must be determined strictly in accordance with the terms and conditions stipulated therein. It is further contended that in the absence of payment of any additional premium for such risk, the insurer cannot be made liable to indemnify the owner for the compensation awarded to a gratuitous occupant, and therefore, the impugned award to that extent deserves to be set aside. 21. On careful examination of the insurance policy (Ex.D/1), it is evident that a premium of Rs.2,500/- has been charged towards third-party risk, Rs.25/- towards coverage for injury to a WC employee, and Rs.450/- towards coverage for nine unnamed passengers. However, the policy does not reflect payment of any premium towards the risk of a gratuitous occupant, who is neither a fare-paying passenger covered under a permit nor otherwise included under the statutory or contractual scope of coverage. In such a factual and legal backdrop, fastening liability upon the Insurance Company for compensation payable to a gratuitous occupant would be contrary to the terms of the policy and beyond the statutory mandate. It is settled law, as laid down by the Hon’ble Supreme Court in the matter of National Insurance Co. Ltd. v. Balakrishnan and another, (2013) 1 SCC 731, that the 10 liability of an insurer in respect of occupants in a private vehicle depends entirely on the specific terms of the policy and the premium paid. In the present case, the non-existence of such coverage stands established from Ex.D/1 itself. 22. Considering the matter in its entirety, including the nature of the policy, the specific risk coverage indicated therein, and the binding principles of law on the subject, this Court is of the view that the liability to satisfy the award must rest upon the owner of the offending vehicle rather than Insurance Company. The contractual obligation of the insurer being absent, there exists no legal basis to sustain the fastening of liability upon it for the present claim. 23. It is also an admitted position that, by virtue of the interim order dated 20.07.2018 passed by this Court, the Insurance Company was directed to deposit 50% of the awarded amount on or before 05.09.2018, which has been complied with. 24. To balance equities and ensure that the claimant is not prejudiced, it is directed that the amount so deposited by the Insurance Company shall not be recoverable from the claimant. The remaining 50% of the awarded amount shall be paid by the owner of the offending vehicle. The Insurance Company shall, however, be at liberty to recover the entire amount of compensation from the owner of the offending vehicle in accordance with law, including by initiating appropriate execution proceedings. 25. In the result :- (i) MAC No.204/2018 filed by the claimant is 11 allowed in part and (ii) MAC No.1137/2018 filed by the Insurance Company is allowed. 26. Records of the concerned Motor Accident Claims Tribunal be sent. Sd/- Sd/- (Amitendra Kishore Prasad) Judge Yogesh