The judgment establishes the principle that the exclusion clause in an insurance policy does not exonerate the insurer if the insured has taken all necessary measures to comply with the policy conditions.

JUDGMENT :

Meenakshi Madan Rai, J.

1. The Appellant, owner of the vehicle in accident, was ordered to pay compensation of Rs.10,26,000/- (Rupees ten lakhs, twenty six thousand) only, with interest @ 10% per annum to the Respondents 1, 2 and 3, on account of the death of the nine year old daughter of the Respondents No. 1 and 2 and sibling of the Respondent No.3, vide the impugned Judgment dated 31.8.2016, in MACT Case No. 23 of 2015, by the learned Motor Accidents Claims Tribunal, East District at Gangtok (for short “learned Tribunal”). The Insurance Company, Respondent No.4 was exonerated, hence, this Appeal.

2. The Respondents No.1, 2 and 3 herein, were the Claimants No. 1, 2 and 3 before the learned Tribunal. The Appellant was the Opposite Party No.1 and the Respondent No.4, the Opposite Party No.2.

3. Learned Counsel for the Appellant would advance the argument that the learned Tribunal erred in directing the Appellant instead of the Respondent No.4, to pay the compensation, on the ground that the vehicle at the time of accident was driven by an unlicensed and unauthorised person, namely one Nirmal Sharma. In fact, the Appellant had handed over the vehicle to the licensed and authorised Driver, Nima Sherpa, the vehicle being duly insured with the Respondent No.4, the liability ought to have been fixed on him, there being no willful breach of statutory or contractual obligation by the Appellant or proof furnished thereof by the Respondent No.4. Drawing the attention of this Court to the provisions of Section 149(2)(a)(ii) of the Motor Vehicles Act, 1988 (for short “M.V. Act”), it was contended that it is akin to the provisions of Section 96(2)(b)(ii) of the Motor Vehicles Act, 1939 (for short “Act of 1939”) and the Supreme Court in Skandia Insurance Company ltd. v. Kokilaben Chandravadan and Ors., (1987) 2 SCC 654, while dealing with the said provision, on similar facts, held, that the exclusion clause in the contract of insurance, making the owner absolutely liable, irrespective of circumstances leading to an unlicensed driver driving the vehicle must be “read down”, being in conflict with the main statutory provision. Further, while discussing the extent of vicarious liability of the owner, held that the owner was not liable where the accident was caused by an unlicensed person, when the licensed driver employed by the owner left the vehicle unattended, contrary to express or implied orders of the owner.

3.(a) Calling attention to the quantum of compensation, it was contended that the Respondents No. 1, 2 and 3 have failed to prove that the income of the deceased was Rs.6000/- (Rupees six thousand) only, per month, hence the claim of Rs.10,50,500/- (Rupees ten lakhs, fifty thousand and five hundred) only, is not maintainable. That, the Supreme Court in the case of Manju Devi and another v. Musafir Paswan and Anr. (2005) ACJ 99 (SC), has held that in a case of a non earning minor victim, the multiplier of “15” would have to be applied and as per the Second Schedule of the M.V. Act, a sum of Rs.15,000/- (Rupees fifteen thousand) only, must be taken as annual income. Thus, the Judgment of this High Court in Branch Manager, National Insurance Company Limited vs. Krishna Bdr. Chettri & Others, MANU/SI/0025/2014, wherein the income of the victim, a child of 15 years, was assessed at Rs.4500/- (Rupees four thousand and five hundred) only, per month, is not a binding precedent being per incuriam. It was further urged that the High Court of Delhi, Gauhati and Madras have followed the precedent laid down in Manju Devi and hence, compensation be computed accordingly in the instant matter. Relying on the decision of Sarla Verma (Smt) and Others v. Delhi Transport Corporation and Another, (2009) 6 SCC 121 and Rajesh & Ors v. Rajbir Singh & Ors., (2013) 9 SCC 54, it was urged that the said Judgments lay down that 50% ought to be added a