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2026 Supreme(HP) 51

IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
Sushil Kukreja, J.
Kalyan Singh Chauhan (since dead through his LRs) & another. – Petitioners
Versus
M/s P.K. Construction & others – Respondents
FAO (MV) No. 4241 of 2013 with FAO (MV) No. 77 of 2014
Decided On : 07-04-2026

Advocates Appeared:
For the Appellant :Mr. Shyam Singh Chauhan, Advocate.
For the Respondent:Mr. Dibender Ghosh, Advocate, Ms. Devyani Sharma, Sr. Advocate, with Ms. Srishti Negi, Advocate.

The court ruled that the insurance company is liable for compensation despite the deceased traveling as a passenger in a goods vehicle, establishing non-exclusion of such passengers from coverage.

Headnote:(A) Motor Vehicles Act, 1988 - Sections 166 and 173 - Appeal for compensation due to death in motor accident - Compensation awarded was Rs.6,22,000/- with interest - Petitioners contended for enhancement on basis of actual salary of deceased - Insurance Company contended liability was not applicable for gratuitous passengers - Tribunal assessed loss of dependency and other heads, awarding total compensation of Rs.8,60,410/- - Tribunal held insurance company liable as indemnifier and modified award. (Paras 6, 36)

(B) Liability of Insurance Company - Gratitude passengers in goods vehicle - Legal position evolved regarding coverage of gratuitous passengers and necessity for proof of traveling status during accident - Insurance company failed to prove deceased was a gratuitous passenger. (Paras 25-34)

Facts of the case:
The petitioners, parents of the deceased, claimed compensation after their son died in an accident while traveling in a construction vehicle. The driver was allegedly negligent. The deceased's age and salary were central to the compensation claim. (Paras 3, 4)

Findings of Court:
The Tribunal's findings included modifying the compensation amount based on a reassessment of income and applying relevant legal precedents regarding salary and future prospects, ultimately awarding Rs.8,60,410/-. (Paras 23, 35)

Issues: Whether the assessment of compensation was correct and if the deceased was a gratuitous passenger, affecting the liability of the insurance company. (Paras 10, 24)

Ratio Decidendi: The court determined that the deceased was not a gratuitous passenger, establishing that the insurance policy covered the deceased's employment-related travel, thereby holding the insurance company liable for compensation. (Paras 30-34)

Result: Appeals disposed of with compensation modified to Rs.8,60,410/- and insurance company held liable.

Table of Content
1. claims based on fatal accident and negligence. (Para 1 , 2 , 3 , 4 , 5)
2. assessment and entitlement of compensation. (Para 6 , 10 , 11)
3. disputes over salary and indemnity liability. (Para 8 , 9)
4. calculation of compensation based on established income. (Para 12 , 13 , 14 , 15 , 16 , 17 , 19 , 20)
5. conventional heads compensation criteria from precedents. (Para 18 , 21 , 22 , 23)
6. legal status of gratuitous passengers in goods vehicles. (Para 24 , 25 , 26 , 27 , 28 , 29)
7. evidence regarding the deceased's status during the accident. (Para 30 , 31 , 32 , 33)
8. final order on compensation. (Para 34 , 35)
9. conclusion and disposal of appeals. (Para 36)

JUDGMENT :

Sushil Kukreja, J.

Since both these appeals are the offshoots of impugned award, dated 19.08.2013, passed by learned Motor Accidents Claims Tribunal (II), Shimla, District Shimla, H.P. (hereinafter for the sake of brevity referred to as “the learned Tribunal”), they are taken up together for consideration and disposal.

2. The appellants, who were petitioners/claimants before the learned Tribunal below (hereinafter referred to as “the petitioners/claimants”) preferred appeal, i.e., FAO (MV) No. 4241 of 2013, under Section 173 of the Motor Vehicles Act, 1988 (for short ‘the Act’) against impugned award, dated 19.08.2013, passed by learned Tribunal below, whereby MAC Petition No. 121-S/2 of 2012/10, filed by the petitioners- claimants, under Section 166 of the Act, was allowed and they were held entitled for compensation of Rs.6,22,000/- alongwith interest @ 9% per annum from the date of filing of the petition till the final realization of the amount, with a prayer to enhance the compensation amount and interest by modifying the award. On the other hand, appellant-National Insurance Company Limited, preferred appeal, i.e., FAO (MV) No. 77 of 2014, under of the Act, against the aforesaid impugned award, with a prayer to allow the appeal by quashing and setting-aside the impugned award and exonerate the appellant-Insurance Company.

3. The facts giving rise to the instant appeals are that the petitioners/claimants, being the parents of Shri Udhey Singh (the deceased), preferred a claim petition under Section 166 of the Act claiming compensation from the respondents. As per the petitioners, on 17.01.2010, the deceased alongwith Babu Ram and Prakash was travelling in Tripper, bearing registration No. HP-63-6579, and was going from Theog to Kiartu. The aforesaid vehicle met with an accident, around 12:30 p.m. and rolled down into a gorge, resultantly the deceased sustained multiple grievous injuries and he was shifted to IGMC, Shimla, where he was declared dead. The petitioners/claimants further averred that respondent No. 2-Shri Dila, was the driver of the offending vehicle and he, at the time of the accident, was driving the vehicle in a rash and negligent manner. The deceased, at the time of the accident, was only 28 years old and was MA in History and he used to work as Site Supervisor with respondent No. 1-M/s P.K. Constructions. The deceased used to got monthly salary of Rs.7980/- and he also used to assist his father in agricultural work. Lastly, the petitioners/claimants sought compensation of rupees twenty lacs.

4. Respondent No. 1- M/s P.K. Constructions, in its reply raised preliminary objection that the petitioners were stopped from filing the petition and the amount of compensation claimed was highly exorbitant. It was denied that the accident occurred due to rash and negligent driving of respondent No. 2. Rest of the averments made in the petition were admitted. Although, respondent No. 2-Shri Dila Ram (driver of the offending vehicle), filed separate reply, however, he took same plea, as taken by respondent No. 1.

5. Respondent No. 3-National Insurance Company, in its reply resisted the claim petition and took preliminary objections of maintainability, collusion between the petitioners and respondents No. 1 and 2. As per the replying respon

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