Liability of insurance company under a comprehensive policy and correct deduction for assessing dependency under the Motor Vehicles Act.

Vijender Singh Malik, J.

The aforesaid two appeals, one bearing FAO No. 4068 of 2010 by Bajaj Allianz General Insurance Company Ltd., the insurer and the other bearing FAO No. 4512 of 2010 by Anil Kumar and another, the claimants are directed against the award dated 03.04.2010. Anil Kumar and Smt. Bimla Devi, the claimants had brought a claim petition u/s 163-A of the Motor Vehicles Act, 1988 (for short 'the Act) seeking compensation in a sum of Rs. 7,00,000/- on the death of Naveen Kumar in a road side accident that took place on 01.08.2006. Learned Motor Accidents Claims Tribunal, Jind (for short the Tribunal) allowed the claim petition vide the impugned award and awarded a sum of Rs. 2,62,000/- as compensation.

2. The challenge to the award from the side of the insurer is that it was not liable to satisfy the award because Naveen Kumar, the deceased had borrowed the motorcycle from Sunil Kumar, the owner and himself was driving the motorcycle when the accident took place. According to him, in such situation, the deceased himself being the person at fault, the insurance company is not liable to satisfy the award.

3. On the other hand, the claimants have the case that instead of 1/3rd, deduction has been made by learned Tribunal at the rate of 1/2 which was against the spirit of second schedule appended to the Act.

4. Learned counsel for the appellant has contended that Parman Preet Singh appeared as RW-1. According to him, said Parman Preet Singh has made a statement that the policy is a comprehensive policy where additional premium has been paid for owner-driver of the vehicle. According to him, Naveen Kumar, the deceased being borrower of the motorcycle from the owner would step into the shoes of the owner and he cannot be termed as 3rd party to claim compensation u/s 163-A of the Act.

5. It is true that Naveen Kumar, who was driving the motorcycle had borrowed the same from its owner and, therefore, stepped into the shoes of the owner. However, the case here is not as to whether the deceased had been a 3rd party or not. The case here is that the policy issued for the motorcycle had been comprehensive policy where additional premium had been paid for covering owner and driver. A Coordinate Bench of this Court in New India Assurance Co. Ltd. Vs. Umesh Kumari and Others (2011) 3 TAC 182, had dealt with the same facts and has held that the deceased being borrower of the vehicle from the owner has to be termed as the owner itself and, there being comprehensive policy where additional premium had been paid to cover the owner and driver, the said policy would cover the claim of the claimants in that situation and the insurance company was held liable to pay compensation. I have no reason to take a different view in the matter. Hence, the insurance company cannot escape its liability to satisfy the award.

6. Coming to the other appeal, learned counsel for the appellant has submitted that there is no provision in the second schedule of deduction above 1/3rd. According to him, when the case was u/s 163-A of the Act, under which compensation has to be assessed as per the structured formula and the second schedule does not admit of any deduction above 1/3rd, the Tribunal was wrong in adopting deduction of 1/2 to assess the dependency of the claimants.

7. Under the second schedule after assessing compensation without applying the deduction it is laid down by way of a note that 1/3rd has to be deducted from the total compensation in consideration of the expenses of the deceased on himself. The Tribunal in this case has taken the income of the deceased at Rs. 3000/- per month and deducted half thereof towards his personal expenses. The deduction should have been 1/3rd instead of 1/2 and, therefore, the monthly dependency of the claimants comes to Rs. 2000/-, which on multiplication with 12, comes to Rs. 24,000/- per annum. The multiplier in this case has been taken to be of 14. As per the second schedule, the multiplier of 15 is suit