Calcutta High Court enhances compensation to ₹5 lakh for 5-year-old accident victim despite fake license

The Calcutta High Court has delivered a significant ruling, enhancing the compensation awarded to the parents of a five-and-a-half-year-old girl who died in a 2014 road accident. The Court applied the amended Second Schedule of the Motor Vehicles Act to a pending claim, raising the award from ₹3.49 lakh to a flat ₹5 lakh, and directed the insurance company to pay the amount with liberty to recover it from the vehicle owner, even though the driver held a fake license.

The Tragic Accident

On August 19, 2014, Shinjini Das alias Srinjini Das was riding pillion on a motorcycle driven by her father, Gour Gopal Das, on her way to school. A truck bearing registration WB-23C-2832 struck the motorcycle from behind, causing the child to fall and be run over by the truck. She was declared brought dead at a nearby hospital. The Belghoria Police Station registered an FIR against the truck driver, and the parents, Soma Das and Gour Gopal Das, filed a claim petition under Section 163A of the Motor Vehicles Act.

The Tribunal's Award

In August 2018, the Motor Accident Claims Tribunal, VIIth Bench, City Civil Court, Calcutta, found that the accident was solely due to the truck driver's negligence and awarded ₹3,49,500 to the parents. The Tribunal completely exonerated the insurer, Magma HDI General Insurance Company Limited, holding that the driver held a fake driving license, which constituted a wilful breach of policy terms.

The Appeal and the Amended Schedule

Challenging the award, the parents argued that the Tribunal erred by not applying the amended Second Schedule to the Motor Vehicles Act, which came into force on May 22, 2018. The amendment, notified by the Ministry of Road Transport and Highways, prescribed a fixed compensation of ₹5 lakh for death in a road accident, regardless of the victim's age or income. The parents contended that since their appeal was pending after the amendment, they were entitled to the enhanced amount.

A Binding Precedent: Urmila Halder

The Court relied heavily on the Division Bench judgment of the Calcutta High Court in Urmila Halder v. New India Assurance Co. Ltd. , which held that the amended Second Schedule is procedural law and applies to all pending claim petitions and appeals as on the date of the award. The Supreme Court affirmed this view in The New India Assurance Co. Ltd. v. Urmila Halder , observing that "a beneficial legislation would necessarily entail the benefit to be passed on to the claimant in the absence of any specific bar ."

Pay and Recover: Insurance Liability Upheld

The insurance company argued that the driver's fake license absolved it of any liability. However, the High Court, applying the Supreme Court's decision in Reliance General Insurance Company Ltd. v. Om Prakash & Others , held that the principle of "pay and recover" applies in such cases. The insurer must first compensate the victims and then recover the amount from the insured.

Key Observations

Justice Md. Shabbar Rashidi, delivering the judgment, observed: "The claimants are entitled to get the minimum compensation provided in Second Schedule of the Act of 1988 to the tune of Rs. 5,00,000/-." The Court further noted that the new schedule "makes no provision for determination of compensation based on the age of the victim. Regardless of who the accident victim is, an adult or a minor and whether the victim was an earning member or not, if the accident causes death, the compensation would be a fixed amount of Rs. 5,00,000.00."

The Verdict

The High Court enhanced the compensation to ₹5 lakh, carrying interest at 6% per annum from the date of filing the claim application until realization. The insurance company was directed to deposit the amount with the Registrar General within six weeks, who will disburse it equally to the two claimants. The Court clarified that the insurer is at liberty to take steps to recover the amount from the vehicle owner in accordance with law.

The judgment reinforces the beneficial nature of the Motor Vehicles Act and ensures that victims' families receive the full benefit of legislative amendments, even in pending cases.