1 2025:CGHC:18338 NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR MAC No. 380 of 2020 1 - Yashwant Kanwar S/o Shri Ramesh Kumar Kanwar Aged About 26 Years R/o Village- Baliyara, Thana - Arjuni, Tahsil And District- Dhamtari, Chhattisgarh. --- Appellant versus 1 - Gautam Kumar Sahu S/o Shri Ghanshyam Sahu Aged About 23 Years R/o Village- Bagdai, Post, Thana And Tahsil- Dongargaon, District- Rajnandgaon, Chhattisgarh. (Driver Of The Truck No Cg-08-L-3013). 2 - Gurdeep Singh Bhatiya S/o Shri Bhagsingh Bhatiya Aged About 43 Years R/o House No. 04, Anupam Nagar Rajnandgaon, Thana, Tahsil And District- Rajnandgaon, Chhattisgarh. (Owner Of The Truck No Cg-08-L-3013). 3 - Manager National Insurance Company Limited Through Branch Office, G.E. Road Mobil Mahal, Second Floor, Tahsil And District- Raipur, Chhattisgarh. (Insurer Of The Truck No. Cg-08-L-3013). --- Respondent(s) For Appellant : Mr. Rajendra Patel, Advocate For Respondent No.1 & 2 : None present though served. For Respondent No.3 : Mr. P. Dutta & Mr. P.K. Tulsyan, Advocate Hon'ble Shri Justice Parth Prateem Sahu Order On Board 23/04/2025 1. Claimant/appellant has filed this appeal under Section 173 of the Motor Vehicles Act, 1988 (for short ‘the Act of 1988’) seeking enhancement of compensation awarded by the learned Additional SHUBHAM DEY Digitally signed by SHUBHAM DEY 2 Motor Accident Claims Tribunal (FTC), Dhamtari, District – Dhamtari (for short ‘the Claims Tribunal’) vide award dated 20.12.2019 passed in Claim Case No. 42/2019 thereby allowing application in part and awarded Rs.2,15,090/- as compensation in an injury case. 2. Facts relevant for disposal of this appeal are that on 03.07.2018 at about 4 o’clock, appellant was travelling along with his friend as pillion rider on motor cycle bearing registration No.C.G.07-LS-6100. When they reached near village – Kuliya, on NH No.930 a truck bearing registration No.C.G.-08-L 3013 driven by respondent No.1 in a rash and negligent manner, dashed the motor cycle and caused accident, due to which appellant suffered fracture in his knee bone and the bone near thigh of his right leg. He was immediately taken to District Hospital, Dhamtari where his right leg was operated and iron rod was implanted. He was admitted in the hospital for about one month. 3. Appellant filed an application under Section 166 of the Act of 1988 seeking total compensation of Rs.7,50,000/- pleading therein that at the time of accident, he was abled and healthy boy aged about 24 years, working as labourere and earning Rs.300/- per day. On account of the injuries suffered in the accident, his right leg became weak. On account of motor-accidental injuries, he is now unable to perform his work in the manner as he was doing prior to the accident and thus suffered loss of income. Claimant has also sought compensation under all other heads as are available to him like medical expenses, special diet, future medical expenses, pain and sufferings etc. 4. Non-applicant No.1 and 2 remained ex-parte before the Claims Tribunal. 3 5. Non-applicant No.3-Insurer of offending vehicle, submitted reply to claim application and while denying the pleadings made therein has pleaded that on the date of accident, non-applicant No.1-driver was not having valid and effective driving license, there was breach of condition of insurance policy. The insurance company was not informed about the accident. Policy issued was cancelled prior to the accident due to dishonouring of cheque on the ground of insufficiency of fund, as such on the date of accident there was no valid policy of the offending vehicle. Hence, insurance company is not liable to pay any amount of compensation. 6. Upon appreciation of pleadings and evidence placed on record by respective parties, the learned Claims Tribunal held that accident occurred due to rash and negligent driving of driver of offending vehicle by non-applicant No.1, due to which the appellant suffered injuries. Breach of Policy condition was not found to be proved. Tribunal allowed application in part, awarded total compensation of Rs.2,15,090/- along with interest @ 6% per annum, fastened liability upon non-applicant No.2/owner of the offending vehicle to pay the amount of compensation. 7. Learned counsel for appellant submits that Tribunal erred in awarding meager amount of compensation overlooking the nature of injuries suffered, occupation and income as pleaded in the claim application and as proved by appellant’s witnesses. It is contended that the learned Claims Tribunal failed to take into account the disability suffered by the appellant due to the road accident, as well as the disability certificate (Ex.P-25) placed on record. Learned Claims 4 Tribunal has also failed to award suitable and proper compensation towards other conventional head i.e. towards special diet, attendant, pains and suffering etc. He further submits that the learned Claims Tribunal has committed a grave error of law by exonerating the insurance company from liability on the ground that the cheque issued by Respondent No. 2 to Respondent No. 3 (the insurance company) towards the premium for the policy was dishonoured, thereby rendering the insurance policy for the offending vehicle invalid, and consequently fixing the liability to pay the compensation amount solely upon the owner, Respondent No. 2. He prays that amount of compensation be suitably enhanced fixing the liability to pay the amount of compensation upon the respondent No.3/Insurance Company. 8. No representation has been made on behalf of respondents No.1 and 2 though notices have been served upon them. 9. Learned counsel for respondents No.3 opposes the submission of learned counsel for appellant and would submit that the learned Claims Tribunal has rightly exonerated the Insurance Company, as the policy issued for the offending vehicle was cancelled from its inception due to dishonouring of cheque issued towards the payment of the premium. The amount of compensation awarded by learned Claims Tribunal in the facts of the case and the evidence available on record, is just and proper. He contended that appellant failed to prove the nature of his occupation and income and further appellant has not suffered permanent disability, therefore, also in the facts of the case, it 5 cannot be said that the amount of compensation awarded is disproportionate. 10. I have heard learned counsel for the parties and perused the record. 11. So far as the submission of learned counsel for appellant that the learned Claims Tribunal has committed grave error in exonerating the insurance company from the obligation to indemnify the insured of making payment of amount of compensation is concerned, in this regard, the non-applicant No.3/Insurance Company has examined Rajesh Kumar Agarwal, Assistant Manager on its behalf, who in his evidence stated that the offending vehicle was insured from 13.09.2017 to 12.09.2018 for which premium of Rs.44,888/- was paid by owner/respondent No.2 through cheque dated 12.09.2017 of Central Bank of India, which was dishonored due to insufficient funds, therefore, the policy No.290700/31/17/6300005876 was canceled on 26.09.2017, with due information to the insured and the concerned RTO. 12. Perusal of the record would show that the insurance company has placed on record the memo issued by the Bank dated 19.09.2017 (Ex.D-3) showing dishonour of cheque issued by respondent No.2 towards premium and sending of intimation by the Insurance Company to respondent No.2 (Ex.D-2) as well as the concerned Regional Transport Authority (Ex.D-1) regarding cancellation of policy from its inception, respectively. These documents explicitly convey that Insurance Policy No. 290700/31/17/6300005876 was cancelled due to dishonouring of the cheque issued by Respondent No. 2 towards payment of the premium. Furthermore, a careful examination of Ex.D- 6 2, along with the testimony of the witness produced by the insurance company, clearly indicates that Respondent No. 2 was duly informed about the cancellation of the policy in the office. This evidence supports the contention that the owner was made aware of the cancellation of the policy arising from non-payment of the premium. 13. In this case, the accident occurred on 03.07.2018, whereas the information regarding the cancellation of the insurance policy was communicated to the concerned Regional Transport Authority and Respondent No.2/owner on 26.09.2017 i.e. much before the date of the accident. 14. In case of National Insurance Co. Ltd. v. Seema Malhotra reported in (2001) 3 SCC 151, the Hon'ble Supreme Court while relying on the decision of a three Judges Bench in Oriental Insurance Co. Ltd. Inderjeet Kaur reported in (1998) 1 SCC 371 has held thus:- “17. In a contract of insurance when the insured gives a cheque towards payment of premium or part of the premium, such a contract consists of reciprocal promise. The drawer of the cheque promises the insurer that the cheque, on presentation, would yield the amount in cash. It cannot be forgotten that a cheque is a bill of exchange drawn on a specified banker. A bill of exchange is an instrument in writing containing an unconditional order directing a certain person to pay a certain sum of money to a certain person. It involves a promise that such money would be paid. 18. Thus, when the insured fails to pay the premium promised, or when the cheque issued by him towards the premium is returned dishonoured by the bank concerned the insurer need not perform his part of the 7 promise. The corollary is that the insured cannot claim performance from the insurer in such a situation. 19. Under Section 25 of the Contract Act an agreement made without consideration is void. Section 65 of the Contract Act says that when a contract becomes void any person who has received any advantage under such contract is bound to restore it to the person from whom he received it. So, even if the insurer has disbursed the amount covered by the policy to the insured before the cheque was returned dishonoured, the insurer is entitled to get the money back. 20. However, if the insured makes up the premium even after the cheque was dishonoured but before the date of accident it would be a different case as payment of consideration can be treated as paid in the order in which the nature of transaction required it. As such an event did not happen in this case, the Insurance Company is legally justified in refusing to pay the amount claimed by the respondents. 15. So far as the dishonouring of the cheque is concerned, it would be relevant to refer to the judgment of the Hon'ble Supreme Court in this regard particularly the case of Deddappa and others v. Branch Manager, National Insurance Co. Ltd., 2008 (2) SCC 595, wherein in paragraph 24 it has been held as under:- “24. We are not oblivious of the distinction between the statutory liability of the insurance company vis-a-vis a third party in the context of Sections 147 and 149 of the Act and its liabilities in other cases. But the same liabilities arising under a contract of insurance would have to be met if the contract is valid. If the contract of insurance has been cancelled and all concerned have been intimated thereabout, we are of the opinion, the 8 insurance company would not be liable to satisfy the claim.” 16. Upon consideration of the oral and documentary evidence on record, and in view of the law laid down by the Hon’ble Supreme Court, the submission advanced by the learned counsel for the appellant that the learned Claims Tribunal committed a grave error in exonerating the Insurance Company is not sustainable and it is accordingly repelled. The finding recorded by the learned Claims Tribunal, exonerating the Insurance Company from liability to indemnify the compensation amount and fastening the liability upon the owner/Respondent No. 2, is hereby affirmed. 17. So far as the submission with respect to disability suffered by appellant is concerned, the appellant examined himself before the Medical Board. The Medical Board issued disability certificate, which is marked and exhibited as Ex.P-25. Perusal of the certificate (Ex.P-25) would show that it was valid up to 07.02.2019. It is also mentioned that there is all possibilities of improvement. Appellant has not produced further medical certificate issued by the Medical Board after 07.02.2019, therefore, in the facts of the case I do not find any error in the finding recorded by the learned Claims Tribunal that the appellant has not suffered any permanent disability affecting the future income. 18. So far as the income of appellant is concerned, appellant has not produced any admissible piece of evidence except the pleading in the application and his own statement that he was working as Mason and earning Rs.400/- per day. In absence of clinching and admissible piece of evidence with respect to the nature of occupation and earning in the 9 considered opinion of this Court, learned Claims Tribunal has not committed any error in assessing the income of the appellant as Rs.8,000/- per month, which is in consonance with the minimum wages fixed by the competent authority under the Minimum Wages Act, 1948. Learned Claims Tribunal has rightly taken into consideration, the loss of income during the laid down period for about 20 months and has awarded Rs.1,60,000/- treating the appellant as unskilled labourer. 19. Learned Claims Tribunal has awarded Rs.3089.78/- towards medical expenses based on the bill produced and proved by the claimants, which also does not call for any interference. The amount of Rs.16,000/- awarded towards attendant for a period of two months also does not call for any interference. The amount of Rs.16,000/- awarded towards special diet appears to be on lower side in the facts of the case, the learned Claims Tribunal has held that the appellant could not able to do the work for a period of 20 months, therefore, in the aforementioned facts of the case and the finding recorded by the learned Claims Tribunal, the amount awarded towards special diet of Rs.16,000/- is enhanced to Rs.30,000/-. The award of compensation under the head of mental pain and suffering in the facts of the case as also the nature of injuries suffered is also appears to be on lower side. The appellant suffered segmental tibial fracture and it has been held that the appellant could not able to do the work for about 20 months and therefore, in the facts of the case I am inclined to enhance the amount under the head mental pain and suffering from Rs.20,000/- to Rs.40,000/- and Rs.25,000/- towards the grievous injury. 10 20. On the basis of above, the compensation awarded by the Tribunal is recomputed as under :- S.N. Head Amount. 1. Expenses towards treatment : Rs. 3,089.78 2. Loss of income during laid down period (Rs.8000x20) : Rs.1,60,000.00 3. For attendant : Rs. 16,000.00 4. For special diet : Rs. 30,000.00 5. For mental pain and suffering : Rs. 40,000.00 6. For grievous injury : Rs. 25,000.00 Total Compensation : Rs.2,74,089.78 21. Accordingly, the appeal is allowed in part. The appellant shall be entitled for total compensation of Rs.2,74,090.00 (after rounding off) . Any amount paid to the appellant as compensation as per award shall be adjusted. Enhanced amount of compensation shall carry interest @ 7.5% per annum from the date of filing of application till its realization. The rest of the conditions of the award shall remain intact. 22. In the result, the appeal is allowed in part and the award impugned stands modified to the extent indicated above. Sd/- (Parth Prateem Sahu) Judge Balram