- 1 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26TH DAY OF JUNE, 2025 BEFORE THE HON'BLE MR JUSTICE UMESH M ADIGA MISCELLANEOUS FIRST APPEAL NO. 5674 OF 2014 (MV) BETWEEN: ORIENTAL INSURANCE CO.LTD., SRI. SHARADA COMPLEX, I FLOOR, OPP: KSRTC BUS STAND, P B ROAD, CHITRADURGA 577 501. NOW REPRESENTED BY ITS REGIONAL MANAGER, ORIENTAL INSURANCE CO.LTD., REGIONAL OFFICE, NO.44/45, LEO SHOPPING COMPLEX, RESIDENCY ROAD, BANGALORE - 560 025. …APPELLANT (BY SRI. A.N. KRISHNASWAMY, ADVOCATE) AND: 1. VASANTHKUMAR L., S/O LINGAPPA @ LINGANNA, NOW AGED ABOUT 29 YEARS, R/O OPP: APMC YARD, SIRA TOWN, SIRA TALUK, TUMKUR DISTRICT - 572 111. NOW RESIDING AT: C/O POOJANNA BEHIND KSFC COLLEGE, SIRAGUTE, TUMKUR. 2. SANJAY KUMAR S/O AMBANNA, MAJOR, Digitally signed by ANNAPURNA G Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 R/A SAADHANA SADANA, RAILWAY STATION ROAD, CHALLAKERE TOWN, CHALLAKERE TALUK, CHITRADURGA DISTRICT-571 501. …RESPONDENTS (BY SRI. V.S. BIJU, ADVOCATE FOR R1, SRI. H.B. NAGARAJA, ADVOCATE FOR R2) THIS MFA IS FILED U/S 173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD DATED:13.3.2014 PASSED IN MVC NO.1072/2011 ON THE FILE OF THE III ADDL. DISTRICT JUDGE & IV MACT, TUMKUR, AWARDING COMPENSATION OF RS.48,000/- WITH INTEREST AT 8% P.A. FROM THE DATE OF PETITION TILL ITS REALIZATION. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE UMESH M ADIGA ORAL JUDGMENT This appeal is filed by the Insurance Company (Respondent No.2) challenging the judgment and award dated 13th March 2014, passed by the III Addl.District Judge & MACT-IV, Tumakuru, (for short `Tribunal), in MVC.No.1072/2011. 2. For the sake of convenience, the parties are referred to as per their rankings before the Tribunal. - 3 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 3. The brief facts of the case are that, on 25.09.2010, the claimant was traveling in a bus bearing registration No. KA-14-A-3754 from Tumakuru to Sira. At about 7:15 p.m., near Jogihalli Gate, the said bus met with an accident due to the rash and negligent driving of the bus by its driver and it collided with a tractor-trailer bearing registration No.KA-06-TA-5410-11, while attempting to overtake the tractor near Seebi-Agrahara Gate. As a result of the impact, the claimant sustained grievous injuries. With these reasons, the claimant prayed for an award of compensation. 4. Respondent No.1 is the owner, and respondent No.2 is the insurer of the offending vehicle. Both respondents filed written statements denying the contentions of the claimant and prayed for dismissal of the claim petition. Respondent No.2, the insurer, further contended that its liability was restricted to the terms and conditions of the insurance policy, and alleged that the - 4 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 driver of the offending vehicle did not possess a valid and effective driving licence to drive the said class of vehicle. 5. From the rival contentions of the parties, the Tribunal framed necessary issues, for its determination. 6. In order to prove his case, the claimant examined himself as PW-1 and marked documents as Exs. P-1 to P- 16. Respondent No.2 examined one witness as RW-1 and marked three documents as Exs.R-1 to R-3. 7. After hearing both the parties and appreciating the evidence on record, the Tribunal has awarded the following amount of compensation: Particulars Amount in Rs. Pain and agony 38,000/- Medical expenses 10,000/- Total 48,000/- The Tribunal directed respondent No.2–insurer to pay the compensation amount with interest at the rate of 8% per annum. Furthermore, it ordered that if the insurer - 5 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 failed to pay the compensation within 60 days from the date of the judgment, interest would be levied at 9% per annum thereafter. Aggrieved by the said judgment and award, the insurer has preferred the present appeal. 8. I have heard the arguments of the learned counsel for the appellant-insurer and the learned counsels appearing for the respondents. 9. The main grievance of the appellant-insurer is that respondent No.1 has violated the terms and conditions of the insurance policy; that the said vehicle did not have a valid fitness certificate; that it was not operating on the permitted route; and that the driver did not hold an effective and valid driving licence for the class of vehicle involved. Despite these contentions, the Tribunal fastened the liability on the insurer to pay compensation. - 6 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 10. The Tribunal, in paragraph 17 of the impugned judgment, discussed these issues. The insurer has produced a copy of the permit, and the Administrative Officer of respondent No.2 was examined as RW-1. However, he was unable to clarify the actual route on which the bus was authorized to ply. Therefore, a mere denial regarding the permit is insufficient to absolve the insurer of liability. Considering the facts and circumstances of the case, the Tribunal has rightly rejected the insurer’s contentions. I do not find any reason to interfere with these findings. Furthermore, the Tribunal, after evaluating the material evidence on record, awarded a just and reasonable amount of compensation. The amount awarded is not exorbitant. 11. The learned counsel for the appellant-insurer argued that, under Section 171 of the Motor Vehicles Act, 1988, the Tribunal is empowered to award interest. Generally, Civil Courts rely on Section 34 of the CPC and - 7 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 award interest at the rate of 6% per annum. However, in this case, the Tribunal awarded interest at 8% per annum and further directed that, if the insurer failed to pay the amount within 60 days, interest would be increased to 9% per annum. The learned counsel contended that this is erroneous and requested modification of this direction to award a consistent interest rate of 8% per annum. 12. It is true that in civil matters, unless it concerns a commercial or monetary transaction, interest is usually awarded at 6% per annum. However, in the present case, the Tribunal awarded interest at 8% per annum by assigning reasons in paragraph 15 of its judgment. Therefore, there is no justification to interfere with that finding. However, the direction to award interest at 9% per annum upon default in payment within 60 days is unwarranted and requires to be set aside. 13. For the aforesaid discussions, I proceed to pass the following: - 8 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 ORDER i) The Appeal is allowed in part. ii) The judgment and award dated 13th March 2014, passed in MVC.No.1072/2011, by the III Addl.District Judge & MACT-IV, Tumakuru, stands modified. iii) The claimant is entitled to compensation of Rs.48,000/- with interest at the rate of 8% p.a. from the date of petition till its realization. iv) The interest awarded by the Tribunal at the rate of 9% p.a. if respondent No.2-insurer fails to pay the amount of compensation within 60 days, is set aside. v) The amount of compensation awarded is meager, therefore, entire amount of compensation is ordered to be released in favour of the claimant on due identification. vi) Whatever amount deposited by the appellant-insurer before this Court shall be transmitted to the concerned Tribunal for disbursement. - 9 - HC-KAR NC: 2025:KHC:22558 MFA No. 5674 of 2014 vii) Draw award accordingly. Registry is directed to send back the records along with a copy of this judgment to the concerned Tribunal. Sd/- (UMESH M ADIGA) JUDGE bk/ List No.: 1 Sl No.: 15