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2026 Supreme(Online)(Kar) 25551

THE HIGH COURT OF KARNATAKA
Ashok S. Kinagi, J
THE BRANCH MANAGER – Appellant
Versus
SHRI MANJUNATH S/O SOMANINGAPPA SUTGATI – Respondent
MFA No. 100610 of 2021 | MFA No. 102670 of 2020 | MFA No. 102671 of 2020 | MFA No. 102672 of 2020 | MFA No. 100051 of 2021 | MFA No. 100602 of 2021



The liability of an insurance company to pay compensation in a motor accident involving a goods vehicle depends upon the authorized presence of passengers as owners of goods or employees; notional income for compensation calculation is to be determined based on State Legal Services Authority guidelines for the relevant year.

Headnote:(A) Motor Vehicles Act, 1988 - Section 166 - Motor accident - Claimants travelling in goods vehicle - Liability of Insurance Company - Claimants were owners of goods or staff (cleaner) - Admission by insurance official confirming presence of claimants as authorized persons - Tribunal correctly fastened liability on insurer. (Paras 18, 19, 20)

(B) Quantum of Compensation - Determination of notional income - Accident occurred in 2014 - Court applied Karnataka State Legal Services Authority (KSLSA) guidelines - Reassessed notional income at Rs. 7,500/- per month. (Paras 22, 29, 35)

(C) Disability - Medical evidence - Tribunal had assessed disability on the lower side - Court reassessed disability percentage based on medical testimony and relevant guidelines to ensure just compensation. (Paras 25, 31, 38)

Facts of the case:
Claimants were travelling in a goods vehicle that turned turtle due to rash driving. They suffered injuries and moved the Tribunal for compensation. The Tribunal awarded compensation, which was challenged by both the claimants (seeking enhancement) and the insurer (denying liability).

Findings of Court:
The court found that the claimants were not unauthorized passengers as they were either owners of the goods or employees (cleaners) of the vehicle. The court enhanced the compensation based on standardized notional income and corrected disability assessments.

Issues: Whether the claimants were unauthorized passengers; and whether the compensation awarded by the Tribunal was just and adequate.

Ratio Decidendi: In the absence of evidence to the contrary, the admission by the insurer's representative regarding the status of the passengers suffices to establish their authorized presence in a goods vehicle; furthermore, notional income must adhere to state-prescribed legal service authority scales for relevant years.

Result: Appeals by Claimants allowed; Appeals by Insurance Company dismissed.

Table of Content
1. procedural background and factual context of the motor accident claims. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11)
2. determinants of insurance liability regarding authorized passengers in goods vehicles. (Para 12 , 13 , 14 , 15 , 16 , 17 , 18 , 19 , 20)
3. assessment of compensation: notional income, disability percentages, and applicable multipliers. (Para 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37 , 38 , 39 , 40 , 41 , 42)

ORA JUDGMENT

(PER: HON'BLE MR. JUSTICE ASHOK S. KINAGI)

1. These appeals are filed challenging the common judgment and award dated 11.08.2020 passed in MVC Nos.2476/2017 to 2478/2017 by the learned Senior Civil Judge and Additional A.M.A.C.T., Bailhongal.

2. MFA Nos. 100610/2021, 100051/2021 and 100602/2021 are filed by the claimants, whereas MFA Nos.102670/2020, 102671/2020 and 102672/2020 are filed by the Insurance Company.

3. Brief facts, leading rise to the filing of these appeals are as follows:

4. On 15.05.2014, the claimants were travelling in a goods vehicle (407) bearing registration No.KA-27/-5130, as per the directions of the owner of the said vehicle. When the vehicle reached near the spot of the accident, the driver of the said vehicle, namely Ravi Kajgar, drove the vehicle in a rash and negligent manner, lost control over the vehicle, and the vehicle turned turtle on the road, resulting in the accident.

5. Due to the said accident, the claimants sustained grievous injuries and filed the claim petitions under Section 166 of the Motor Vehicles Act. Accordingly, prays to allow the claim petitions.

6. The owner of the offending vehicle filed a statement of objections denying the averments made in the claim petitions and contending that the vehicle was duly insured with the Insurance Company and denied that the accident occurred due to rash and negligent driving by its driver. It was further contended that one Manjunath was working as a cleaner in the said goods vehicle and was employed by the owner. It was denied that expenses were incurred towards medical treatment and contended that, as on the date of the accident, the vehicle had a valid fitness certificate and the driver possessed a valid and effective driving licence. Hence, the owner sought dismissal of the claim petitions as against him.

7. The Insurance Company filed its statement of objections denying the averments made in the claim petitions. It disputed the age and income of the claimants and contended that the driver of the goods vehicle did not possess a valid and effective driving licence as of the date of the accident. Accordingly, it sought for dismissal of the claim petitions against it.

8. The Tribunal clubbed all the claim petitions together and framed separate issues.

9. In support of their case, the claimants examined themselves as PW-1 to PW-3, examined the doctor as PW-4, and marked 79 documents as Exs.P-1 to P-79. Conversely, on behalf of the respondents, RW-1 and RW-2 were examined and two documents were marked as Exs.R-1 and R-2.

10. Upon assessment of the oral and documentary evidence, the Tribunal partly allowed the claim petitions vide judgment dated 11.08.2020 and awarded compensation of ₹2,32,682/- in MVC No.2476/2017, ₹96,800/- in MVC No.2477/2017, and ₹1,50,720/- in MVC No. 2478/2017, with interest at the rate of 9% per annum from the date of petition till realization. The Tribunal directed the Insurance Company to deposit/pay the compensation amounts in all the three cases.

11. Being dissatisfied with the quantum of compensation, the claimants have filed the appeals in MFA Nos. 100610/2021, 100051/2021 and 100602/2021. The Insurance Company has filed appeals in MFA Nos.102670/2020, 102671/2020 and 102672/2020 challenging the liability fastened on it.

12. Heard the arguments of the learned counsel for the claimants, and the learned counsel for the Insurance Company.

13. The learned counsel for the claimants submits that the compensation awarded by th

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