- 1 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH DATED THIS THE 26TH DAY OF MARCH, 2025 BEFORE THE HON'BLE MR. JUSTICE UMESH M ADIGA MFA NO. 100572 OF 2014 (MV-D) BETWEEN: THE DIVISIONAL MANAGER, ORIENTAL INSURANCE CO. LTD, DIVISION OFFICE, ENKAY COMPLEX, KESHWAPUR, HUBLI. REPRESENTED BY DEPUTY MANAGER, REGIONAL OFFICE, HUBLI. … APPELLANT (BY SRI. M. K. SOUDAGAR, ADVOCATE) AND: 1. SMT. PALAXAMMA W/O. BASAVARAJ MYAGERI, AGE 47 YEARS, OCC: HOUSEHOLD, R/O. VARUR, TQ: HUBLI, DIST: DHARWAD. 2. SRI. RAVIKUMAR S/O. BASAVARAJ MYAGERI, AGE 33 YEARS, OCC: MEDICAL REPRESENTATIVE, R/O. MAIN BAZAR, GAJENDRAGAD, TQ: RON, DIST: GADAG. 3. SRI. KALAKAPPA S/O. BASAVARAJ MYAGERI, Digitally signed by VISHAL NINGAPPA PATTIHAL Location: High Court of Karnataka, Dharwad Bench - 2 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 AGE 31 YEARS, OCC: WORKER, R/O. MAIN BAZAR, GAJENDRAGAD, TQ: RON, DIST: GADAG. 4. SRI. RAMESH S/O BASAVARAJ MYAGERI, AGE 26 YEARS, OCC: PRIVATE SERVICE, R/O. MAIN BAZAR, GAJENDRAGAD, TQ: RON, DIST: GADAG. 5. SRI. PRADEEP S/O. BASAVARAJ MYAGERI, AGE 24 YEARS, OCC: STUDENT, R/O. MAIN BAZAR, GAJENDRAGAD, TQ: RON, DIST: GADAG. 6. SRI. VEERESH S/O. SANGANBASAPPA NADIHAL, AGE MAJOR, OCC: OWNER OF VEHICLE CAR, R/O. GAJENDRAGAD, TQ: RON, DIST: GADAG. … RESPONDENTS (BY MISS. SHOBA A. KHANAPUR, ADV. FOR SRI. SUNIL S. DESAI, ADV. FOR R1 TO R5; NOTICE TO R6 SERVED) THIS MISCELLANEOUS FIRST APPEAL IS FILED U/SEC.173(1) OF MOTOR VEHICLES ACT, 1988, PRAYING TO CALL FOR THE RECORDS IN MVC NO.952/2012 BEFORE THE PRIL. SENIOR CIVIL JUDGE AND ADDL. MACT, HUBLI AND SET ASIDE THE JUDGMENT AND AWARD DATED 24.10.2013 PASSED IN MVC NO.952/2012 BY THE PRL. SENIOR CIVIL JUDGE AND ADDL. MACT, HUBLI AND ETC. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: - 3 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 ORAL JUDGMENT (PER: THE HON'BLE MR. JUSTICE UMESH M ADIGA) 1. This is an insurer’s appeal against the judgment and award dated 24th October 2013, passed in MVC No.952 of 2012 by the Prl. Senior Civil Judge and Addl. MACT, Hubli (for short “the Tribunal”). 2. The parties herein are referred to as per their ranks before the Tribunal, for the sake of convenience. 3. It is the case of the claimant that, on 21.02.2011, the deceased Basavaraj was traveling in a car bearing registration No.KA-26/M-3008 along with his friends to attend the marriage. The said car met with an accident around 2:30 p.m. near Kurubanal. As a result of the impact, the deceased Basavaraj sustained fatal injuries and while undergoing treatment, succumbed to his injuries on 01.03.2011. 4. It is further contended by the claimant that the deceased was aged about 55 years at the time of accident. He was businessman and earning Rs.3,300/- per month. - 4 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 The petitioner and respondent Nos.3 to 6 are his legal heirs and were depending upon his income. On these grounds, the claimant sought for compensation of Rs.19,50,000/-. 5. Respondent No.2, the insurer, denied the contentions of the claim petitioners. It was further contended that the petition is not maintainable under Section 163-A of the M.V. Act, 1988, since the vehicle that allegedly caused the accident was not tenable. Therefore, respondent No.2 is not liable to pay compensation. 6. Based on the rival contentions of the parties, the Tribunal framed necessary issues. 7. To establish the case, the claimant examined two witnesses as PW1 and PW2 and got marked 19 documents as Exs.P1 to P19. Respondent No.2 examined one witness as RW1 and not marked any documents. 8. The Tribunal after hearing both sides and on appreciating the pleadings and evidence on record, awarded the following amounts of compensation: - 5 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 1. Loss of dependency Rs.2,40,000/- 2. Medical expenses Rs.6,18,727/- 3. Loss of consortium Rs.5,000/- 4. Loss of estate Rs.2,500/- 5. Funeral expenses and transportation of the body Rs.2,000/- TOTAL Rs.8,68,227/- 9. Being aggrieved by the judgment and award passed by the Tribunal, the insurer has filed this appeal. 10. Learned counsel for the insurer vehemently contends that two vehicles were involved in the accident. According to the claimant, another vehicle that caused the accident left the spot of incident immediately without stopping the vehicle. If that is the case, the claimant should have approached the competent authority for compensation under Section 140 of the M.V. Act. Instead, they have filed a claim petition under Section 163-A of the M.V. Act, which the Tribunal has failed to consider. 11. He further contends that the claimants are claiming compensation under Section 163-A of the M.V. Act. In that event compensation shall be assessed on the basis - 6 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 of structured formula. Hence, the Tribunal should not have awarded the entire medical expenses, but should have restricted the claim only to the maximum extent of Rs.15,000/-. Therefore, the said finding of the Tribunal in this regard is erroneous. 12. Learned counsel for the claimants argues that the Tribunal has thoroughly discussed the reasons for awarding the said amount of compensation, and no interference is warranted by this Court. He further contends that under Section 163-A of the M.V. Act, it is sufficient if involvement of vehicle in the accident is proved. Since there is no serious dispute about the involvement of the vehicle, in which the deceased was traveling, the claim is maintianble under Section 163-Aof the M.V. Act. There is no necessity to claim compensation under the hit and run scheme or no fault liability. Therefore, he supports the judgment and award passed by the Tribunal and prays for the dismissal of the appeal. - 7 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 13. Section 163-A of the M.V. Act (prior to the amendment of the said Act) reads as under: “163A. Special provisions as to payment of compensation on structured formula basis.- (1) Notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle or the authorised insurer shall be 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 or the victim, as the case may be. Explanation. - For the purposes of this sub- section, “permanent disability” shall have the same meaning and extent as in the Workmen’s Compensation Act, 1923 (8 of 1923). (2) In any claim for compensation under sub-section (1), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person. (3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time amend the Second Schedule.” 14. The aforesaid provision stipulates that the compensation is payable if the accident arises out of the use of a motor vehicle. The mere involvement of another unknown vehicle is not a ground to reject a claim under - 8 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 Section 163-A of the M.V. Act. Undisputedly the deceased Basavaraj traveling in the car, that it met with an accident. He sustained injuries leading to his death. Therefore, the claim under Section 163-A of the M.V. Act is maintainable. 15. The main grievance of the appellant is that the Tribunal awarded Rs.6,18,727/- towards medical expenses, despite the claim being filed under Section 163-A of the M.V. Act. Under the provisions of Section 163-A of the M.V. Act, 1988, maximum permissible compensation for medical expenses is Rs.15,000/-. Hence, this Court shall restrict the same. The said contention is acceptable. 16. Learned counsel for the appellant relies upon the judgment of the Apex Court in the case of Reshma Kumari and others Vs. Madan Mohan and another1, wherein at paragraph No.46 it was held as under: “46. Section 163-A which has an overriding effect provides for special provisions as to payment of compensation on structured-formula basis. Sub- section (1) of Section 163-A contains non obstante clause in terms of whereof the owner of the motor 1 (2013) 9 SCC 65 - 9 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 vehicle or the authorized insurer is liable to pay in the case of death or permanent disablement due to the accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be …” 17. As per the structured formula in Schedule-II, the maximum permissible medical expenses that could be awarded by the Tribunal is Rs.15,000/-, subject to production of receipts. In this case, although the Tribunal has considered the relevant receipts, but awarded Rs.6,18,727/- towards medical expenses, which is contrary to law. The Tribunal ought to have restricted the amount of compensation under the head medical expenses is to Rs.15,000/-. Accordingly, the compensation is recalculated: 18. There is no dispute about the compensation calculated under the head loss of dependency, loss of consortium, loss of estate and funeral expenses & transportation of the body; the dispute is only in respect of the medical expenses that need to be rectified. - 10 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 19. For the aforesaid discussion, following amounts of compensation are recalculated as under: 1. Loss of dependency Rs.2,40,000/- 2. Medical expenses Rs.15,000/- 3. Loss of consortium Rs.5,000/- 4. Loss of estate Rs.2,500/- 5. Funeral expenses and transportation of the body Rs.2,000/- TOTAL Rs.2,64,500/- 20. In light of the above, this Court pass the following: ORDER (i) The appeal is allowed in part. (ii) The impugned judgment and award dated 24th October 2013, passed in MVC No.952 of 2012 by the Prl. Senior Civil Judge and Addl. MACT, Hubli is modified. a. The claimants and respondent Nos.3 to 6 together are entitled to the total compensation of Rs.2,64,500/- as against Rs.8,68,227/- awarded by the Tribunal, with interest at the rate of 6% p.a. from the date of petition till its realization. - 11 - NC: 2025:KHC-D:5557 MFA No. 100572 of 2014 (iii) The appellant – insurer shall deposit the compensation amount within a period of eight weeks from the date of receipt of a certified copy of this judgment before the Tribunal. (iv) The amount in deposit, if any, shall be transmitted to the Tribunal for disbursement. Any excess amount in deposit, shall be refunded to the insurer upon due acknowledgement. (v) The remaining portion of the order of the Tribunal is not disturbed. (vi) The Registry shall send a copy of this judgment to the Tribunal forthwith. (vii) The Registry to draw award accordingly. Sd/- (UMESH M ADIGA) JUDGE VNP /CT-AN List No.: 1 Sl No.: 7