- 1 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 12TH DAY OF DECEMBER, 2025 BEFORE THE HON'BLE SMT. JUSTICE LALITHA KANNEGANTI MISCELLANEOUS FIRST APPEAL NO.2214/2022 (MV-I) BETWEEN: B.K.NARASIMHA MURTHY S/O KENCHAIAH AGED ABOUT 59 YEARS R/AT NO.174, 3RD MAIN ROAD SUVARNA NAGAR NEAR WIPRO LAYOUT DODDABIDRAKALLU BENGALURU-560073. …APPELLANT (BY SRI. P MAHADEVASWAMY, ADVOCATE) AND: 1. THE MANAGER UNITED INSURANCE CO. LTD., KRISHI BHAVAN, 5TH FLOOR HUDSON CIRCLE BENGALURU-02. 2. SRI SHIVA KUMAR Digitally signed by MEGHA MOHAN Location: HIGH COURT OF KARNATAKA - 2 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 S/O THIMMAPPA HONNAGONDANAHALLI POST SIRA TALUK TUMIKUR-572137. …RESPONDENTS (BY SMT. MANJULA NEMICHANDRA TEJASWI, ADVOCATE FOR R1 R2 – SERVED AND UNREPRESENTED) THIS APPEAL IS FILED U/S.173(1) OF MV ACT, AGAINST THE JUDGMENT AND AWARD DATED 15.11.2021 PASSED IN MVC NO.3122/2019 ON THE FILE OF THE III ADDITIONAL JUDGE, MACT, COURT OF SMALL CAUSES, BENGALURU, (SCCH-18), PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION. THIS APPEAL HAVING BEEN HEARD AND RESERVED ON 01.09.2025, COMING ON FOR PRONOUNCEMENT OF ORDER THIS DAY, THE COURT PRONOUNCED THE FOLLOWING: CORAM: HON'BLE SMT. JUSTICE LALITHA KANNEGANTI - 3 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 CAV JUDGMENT Aggrieved by the award passed in MVC.No.3122/2019 dated 15.11.2021 by the III Additional Small Causes Judge & ACMM, Bengaluru, the appellant/claimant is before this Court questioning the liability fixed on the owner of the vehicle and also seeking enhancement of the compensation. 2. The claim petition was filed seeking compensation of an amount of Rs.5,00,000/- for the injuries sustained by the claimant in the road traffic accident. It is the case of the claimant that on 24.03.2019 at about 12:30 p.m., when he was riding his motorcycle, at that time, all of a sudden, another motorcycle driven by its rider came in a rash and negligent manner, endangering to human life and dashed against the claimant. Consequently, the claimant fell down and sustained grievous injuries. 3. It is the case of respondent No.1/Insurance Company that due to the negligence on the part of the claimant, accident had occurred and respondent No.2 being the owner of the offending vehicle violated the terms and conditions of the insurance policy and as on the date of the accident, the rider of - 4 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 the offending vehicle was a minor and before the Tribunal, the owner of the offending vehicle remained absent. 4. The Tribunal had held that the accident had occured because of the rash and negligent driving of the rider of the offending vehicle. Further, when it comes to liability, the Tribunal had observed that the policy pertaining to the offending vehicle was in force as on the date of the accident. As on the date of the accident, the rider of the offending vehicle was minor. As per the traffic rules, the minimum age to apply for valid driving permit to drive a motorbike is 18 years. The Tribunal observed that it was laid down in several decided cases that it is the duty of the owner of the vehicle to ensure that it was not misused. Otherwise, he would be liable to pay compensation for the accident, when the vehicle is driven by a minor. The Tribunal observed that the owner of the vehicle has not come forward to explain in connection with the accident and to show that the offending vehicle was not misused and hence, the Tribunal held that the owner of the vehicle alone is liable to pay the compensation and the Insurance Company was absolved from its liability. - 5 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 5. Coming to the quantum of compensation, the Tribunal has granted compensation as per the table given below: SL. No. Heads Compensation Awarded 1. Pain, and suffering : Rs. 50,000/- 2. Loss of income during laid up period : Rs. 00/- 3. Medical expenses : Rs. 1,00,670/- 4. Attendant, nourishment and conveyance charges : Rs. 3,000/- 5. Loss of future income : Rs. 00/- 6. Loss of amenities : Rs. 00/- 7. Future medication : Rs. 00/- Total : Rs. 1,53,670/- 6. Learned counsel appearing for the appellant/claimant submits that as per the law laid down by the Hon’ble Apex Court in case of National Insurance Co. Ltd Vs. Swaran Singh1, the principal of pay and recovery will apply and the Tribunal had fixed the liability on the owner of the vehicle. It is submitted that under the head of pain and suffering, the Tribunal had not granted just and reasonable compensation. When the claimant was in hospital as inpatient for 4 days and 1 (2004) 3 SCC 297 - 6 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 he was an outpatient for more than 5 months, the Tribunal had not granted any amount under the head of loss of income during laid up period. It is submitted that he was working as peon at Indian Air Force and due to the accident, he had taken one month leave and the Tribunal had not granted any amount under the head of loss of future income. 7. Learned counsel appearing for respondent No.1/Insurance Company submits that when the rider of the offending vehicle is a minor it amounts to fundamental breach of the conditions of the insurance policy, the principal of pay and recover will not apply. In this regard, she had relied on the judgment of the Hon’ble Apex Court in Swaran Singh's case referred supra at paragraph No.84 and 110(vi) which reads as follows: "84. We have analysed the relevant provisions of the said Act in terms whereof a motor vehicle must be driven by a person having a driving licence. The owner of a motor vehicle in terms of Section 5 of the Act has a responsibility to see that no vehicle is driven except by a person who does not satisfy the provisions of Section 3 or 4 of the Act. In a case, therefore, where the driver of the vehicle admittedly did not hold any licence and the same was allowed consciously to be driven by the owner of the vehicle by such person, the insurer is entitled to succeed in its defence and avoid liability. The matter, however, may be different where a disputed question of fact arises as to whether the driver had a valid licence or where the owner of the - 7 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 vehicle committed a breach of the terms of the contract of insurance as also the provisions of the Act by consciously allowing any person to drive a vehicle who did not have a valid driving licence. In a given case, the driver of the vehicle may not have any hand at all, e.g. a case where an accident takes place owing to a mechanical fault or vis-major. 110(vi) Even where the insurer is able to prove breach on the part of the insured concerning the policy condition regarding holding of a valid licence by the driver or his qualification to drive during the relevant period, the insurer would not be allowed to avoid its liability towards insured unless the said breach or breaches on the condition of driving licence is/are so fundamental as are found to have contributed to the cause of the accident. The Tribunals in interpreting the policy conditions would apply "the rule of main purpose" and the concept of "fundamental breach" to allow defences available to the insured under section 149(2) of the Act.” 8. Learned counsel had relied on the judgment in case of United India Insurance Co. Ltd Vs. Rakesh Kumar Arora and Others2 in paragraph Nos.20 and 21 which reads as follows: “20. It was furthermore observed: "90. We have construed and determined the scope of sub- clause (ii) of sub-section (2) of Section 149 of the Act, Minor breaches of licence conditions, such as want of medical fitness certificate, requirement about age of the driver and the like not found to have been the direct cause of the accident, would be treated as minor breaches of inconsequential deviation in the matter of use of vehicles. Such minor and inconsequential deviations with regard to licensing conditions would 2 AIR 2009 SC 24 - 8 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 not constitute sufficient ground to deny the benefit of coverage of insurance to the third parties. 91. On all pleas of breach of licensing conditions taken by the insurer, it would be open to the Tribunal to adjudicate the claim and decide Better se liability of insurer and insured; although where such adjudication is likely to entail undue delay in decision of the claim of the victim, the Tribunal in its discretion may relegate the insurer to seek its remedy of reimbursement from the insured in the civil court." The decision in Swaran Singh, however, was held to be not applicable in relation to the owner or a passenger of a vehicle which is insured. “21. In view of the authoritative pronouncement of this Court as noticed hereinbefore, the impugned judgment cannot be sustained. It is set aside accordingly and that of the learned Tribunal is restored. However, keeping in view the admitted fact that as no stay had been granted by the High Court the appellant has deposited the entire amount which has since been withdrawn by the claimant-respondent; we direct that the appellant shall be entitled to recover the amount in question from the owner of the vehicle, namely, respondent No. 1." 9. She had relied on the judgment in case of New India Assurance Co. Ltd, Bengaluru Vs. Hemanth T Ramesh3 at paragraph No.11 which reads as follows: “(11.) I. In that view of the matter, the appeal filed by insurance company is partly allowed. The judgment and award dated 1-4-2011 passed in MVC. No.975/2010 (Old No. 249/2009) on the file of MACT, Mysore, is modified restricting the liability on the owner, driver of Toyota Qualis to an extent of 70%, thereby restricting the liability of insurance company to indemnify the compensation to an extent of 70% only payable with interest at 6% p.a., from the date of 3 LAWS (KAR) 2015-6-475 - 9 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 petition till date of payment of said amount. The said compensation would cover the expenses towards past, present and future medical expenses and other incidental charges. It is seen that in this proceedings, the rider and owner of the TVS Scooty Pep are not arraigned as parties. However, the material on record has clearly established the negligence on the part of rider of two wheeler, who is minor and has driven the same in rash and negligent manner without having valid driving licence. Hence, there is contributory negligence on his part in causing the accident, for which he also should share the liability to pay compensation as stated supra. Therefore, it is made clear that the claimant shall be entitled to recover from the rider of TVS Scooty Pep and his father 30% of compensation along with interest at 6% p.a. Since the father of rider of vehicle is vicariously responsible in entrusting the vehicle to his son for riding the same, which has resulted in the said minor taking the claimant along with him and exposing him to such danger, he shall pay the compensation as owner of two wheeler and also as guardian of minor rider. Since the liability of rider of two wheeler is quantified in this proceedings, the claimant is at liberty to implead the rider and the owner as parties to the claim proceedings. Since the rider of two wheeler is minor, his next friend and father, who is vicariously liable for the mistakes of his son, who is also owner of the said two wheeler should be impleaded, thereafter, by levying execution shall recover the same from him. It is further clarified that the owner of TVS Scooty Pep shall not be entitled to seek indemnification of said liability from the insurer of said two wheeler as there is violation of policy condition in entrusting the vehicle to a minor.” 10. She had relied on the judgment in case of New India Assurance Co. Ltd Vs. Bibi Nafisa and Others arising out of MFA.No.7683/2014 C/w MFA Cross Objection No.54/2020 dated 28.05.2024 which reads as follows: - 10 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 “9. For applying the principles of pay and recovery as per sub-sections (1) & (2) of Section 149 of the Motor Vehicles Act, 1988, if any of the conditions is violated, though Insurance Company can be exonerated from the liability, but the order of pay and recovery can be made. But in the present case, while considering Sub- Clause (ii) of Sub-Section (2) of Section 149 of the Motor Vehicles Act, in the case of a minor boy of 16 years old who was riding the vehicle and caused the accident, this proviso is not applicable so as to say that terms and conditions of the Insurance Company are violated. Where a minor boy under the age of 16 years cannot be said to be a qualified person to apply for driving licence, it cannot also be categorized that he is not duly licenced so as to come within the ambit of sub-clause (ii) of sub-section (2) Section 149 of the MV Act when a minor boy of 16 years old inherently is not a qualified person so as to apply for driving licence. Therefore, the principle of pay and recovery is not applicable in case minor boy drives the vehicle and causes the accident. Hence, the prayer of pay and recovery is hereby rejected.” 11. Learned counsel had also relied on the judgment in case of Yogananda and Another Vs. Smt. Jayalakshmi. M and Another arising out of MFA.No.143/2018 C/w MFA.No.142/2018 dated 20.02.2020 at paragraph No.7 which reads as follows: “7. In the light of the aforesaid judgment, in fact, the State should have prosecuted the father of Vivek for having entrusted the vehicle to a minor who did not possess valid driving licence. Therefore, the question of decorating them with compensation does not arise. In fact, we are of the opinion that the parents of Ms. Suchitha Gowda, who is victim of the reckless and irresponsible act of deceased Vivek and his father who is also equally responsible in permitting his son to ride - 11 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 the vehicle without valid driving license, may take necessary steps for initiating criminal prosecution against the father of the deceased Vivek for wrongfully entrusting the vehicle to him when he did not have valid driving licence to drive the vehicle in question.” 12. By relying on these judgments, learned counsel appearing for respondent No.1/Insurance Company submits that the principle of pay and recover will not apply. It is submitted that in the facts and circumstances of the case, no enhancement is called for. 13. Having heard the learned counsels on either side, perused the entire material on record. The claimant had sustained head injury with sub dural hemorrhage with fracture of right petrous temporal bone and right zygomatic bone, right ankle fracture calcanium undisplaced, right temporal area of the face-swelling and abrasions over the scalp near vertex® medical malleolus (Ankle) with swelling. Hence, under the head of pain and suffering, this Court is granting an amount of Rs.70,000/-. Then coming to loss of income during the laid up period, the claimant is working as a peon at Indian Air Force and according to him, he is earning an amount of Rs.40,000/- per month. But no evidence was placed before the Tribunal about the loss of income consequent upon the injuries - 12 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 sustained by the claimant. As far as the disability is concerned, no other document is placed before the Tribunal. Hence, the Tribunal had held that he is not entitled for any compensation under the heads of loss of future income and loss of income during the laid up period. The Tribunal had rightly granted an amount of Rs.1,00,670/- towards medical expenses. Considering the hospitalization of 4 days and the out-patient treatment for more than five months, this Court deems it appropriate to award an amount of Rs.15,000/- towards attendant charges, food and nourishment and conveyance charges. The claimant is not entitled for loss of future income or loss of the amenities and towards future medication as there is no evidence of the doctor. 14. In the light of the law laid down by the Hon'ble Supreme Court in the case of V.Mekala Vs. M. Malathi and Another4, the claimant is entitled for an amount of Rs.10,000/- towards legal expenses. 15. The claimant is therefore, entitled for compensation under the following heads: 4 (2014) 11 SCC 178 - 13 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 SL. No. Heads Compensation Awarded by Tribunal Compensation Awarded by this Court 1. Pain, and suffering : Rs. 50,000/- 70,000/- 2. Loss of income during laid up period : Rs. 00/- 00/- 3. Medical expenses : Rs. 1,00,670/- 1,00,670/- 4. Attendant, nourishment and conveyance charges : Rs. 3,000/- 15,000/- 5. Loss of future income : Rs. 00/- 00/- 6. Loss of amenities : Rs. 00/- 00/- 7. Future medication : Rs. 00/- 00/- 8. Legal Expenses : Rs. 00/- 10,000/- TOTAL : Rs. 1,53,670/- 1,95,670/- 16. Altogether, the claimant is entitled for compensation of an amount of Rs.1,95,670/-. 17. Then coming to the principal of pay and recover and the liability, the Tribunal had held that as the rider of the offending vehicle is a minor and as he was not having the driving license as on the date of the accident, it is fundamental breach of the conditions of the policy and the Insurance Company is not liable to pay any compensation. When there is breach of terms and conditions of the policy, though it is the - 14 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 rule that the Insurance Company is not liable to pay the compensation, the principle of pay and recover is consistently applied by the Court considering the plight of the third party. The Hon’ble Apex Court time and again in several judgments had applied the principle of pay and recover. In the judgment of the Hon’ble Apex Court in Swaran Singh's case referred supra and later in several other cases also, the same principle of pay and recovery is applied. No doubt that the judgment that are relied on by the learned counsel for respondent No.1/Insurance Company are decided by the Division Bench of this Court and also by the learned single Judge it is held that in the cases of this nature, the principle of pay and recover will not apply. 18. The recent judgment of the Hon’ble Apex Court in case of M. Ananthi & Ors Vs. P.Venkatesan & Anr5 in Civil Appeal No.1175/2025 arising out of SLP(C)No.377/2023 dated 29.01.2025, in similar circumstances had held that the principal of pay and recover will apply. In the above referred case, it is the contention of the claimants that the Tribunal and the High Court ought to have passed an order of pay and recover so that the claimants could have received the 5 Civil Appeal No.1175/2025 - 15 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 compensation. The Hon’ble Apex Court has observed that in so far as the liability of the Insurance Company is concerned, the Courts below have rightly held that since the driver of the offending vehicle was not having any license to drive the same, the Insurance Company cannot be held liable to compensate. The Hon’ble Apex Court observed that they find no error or illegality in the said part of the order. However, while granting the compensation of Rs.10,36,000/- with interest, the High Court has not directed the Insurance Company to pay the sum and to recover the same from the owner/driver. In Swaran Singh's case referred supra, it has been laid down that the claimant should not be allowed to suffer and run about to release the compensation awarded and that it is in the fitness of things that the Insurance Company in such cases should pay first and then recover the amount. Accordingly, the Hon'ble Apex Court had modified the judgment and order passed by the High Court dated 20.08.2020 and directed the Insurance Company to make the payment of the compensation awarded which shall be distributed as per directions containing in the order of the High Court and Insurance Company is at liberty to recover the same. - 16 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 19. In this case also, the Tribunal had rightly held that the Insurance Company is absolved from the liability. However, considering the plight of the third party and consider the principle of pay and recover which has been affirmed by the Hon’ble Apex Court in the judgments referred supra, in the considered opinion of this Court, the principal of pay and recover will apply to this case. Hence, respondent No.1/Insurance Company shall pay the compensation and recover the same from respondent No.2/owner of the vehicle. 20. Accordingly, the appeal filed by the claimant is partly allowed by enhancing the compensation from an amount of Rs.1,53,670/- to Rs.1,95,670/-. The Insurance Company shall pay the compensation and recover the same from the owner of the vehicle. i. The enhanced amount shall carry interest at 6% per annum from the date of petition till the date of realization. ii. The respondent No.1 - Insurance Company shall deposit the amount within a period of eight weeks from the date of receipt of copy of the judgment and shall recover the same from respondent No.2/owner of the vehicle. On such deposit, the - 17 - HC-KAR NC: 2025:KHC:53058 MFA No. 2214 of 2022 claimant is entitled to withdraw the entire amount without furnishing any security. iii. Registry is directed to return the Trial Court Records to the Tribunal, along with certified copy of the order passed by this Court forthwith without any delay. iv. No costs. v. Pending miscellaneous petitions, if any, shall stand closed. SD/- (LALITHA KANNEGANTI) JUDGE MEG CT:bms List No.: 3 Sl No.: 1