NEW INDIA ASSURANCE CO. LTD. vs SAROJBEN ANILBHAI NANDHA
- Court
- Gujarat High Court
C/FA/2023/2016 JUDGMENT DATED: 01/05/2026
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2023 of 2016
With
R/CROSS OBJECTION NO. 13 of 2017
In
R/FIRST APPEAL NO. 2023 of 2016
FOR APPROVAL AND SIGNATURE:
HONOURABLE MS. JUSTICE NISHA M. THAKORE
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Approved for Reporting Yes No
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NEW INDIA ASSURANCE CO. LTD.
Versus
SAROJBEN ANILBHAI NANDHA & ORS.
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Appearance:
MR SUNIL B PARIKH(582) for the Appellant(s) No. 1
ADVOCATE NOTICE SERVED for the Defendant(s) No. 1,2,3
RULE SERVED for the Defendant(s) No. 4,5
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CORAM: HONOURABLE MS. JUSTICE NISHA M. THAKORE
Date : 01/05/2026
ORAL JUDGMENT
1. The present appeal is filed at the instance of the
Insurance Company under Section 173 of the Motor Vehicle
Act, 1988, being aggrieved and dissatisfied with the
judgment and award dated 20.06.2016, passed by the
learned Motor Accident Claims Tribunal, (Special), Rajkot in
MACP No. 626 of 2005. By the said judgment and award the
Tribunal has partly allowed the claim petition preferred by
the original claimants under Section 166 of the Motor
Vehicle Act, 1988 holding them entitled to recover amount
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of Rs. 8,03,551/- with interest at the rate of 9% per annum
from the date of filing of such claim petition till its actual
realization, from the original opponents jointly and
severally with proportionate costs.
2. The appeal preferred by the appellant insurance
company is mainly on the issue of liability on the grounds
with regard to quantum of compensation being determined
on higher side and issue of negligence has also been raised.
Considering the grounds raised in the appeal memo and
submissions made by learned advocate for the appellant-
Insurance Company, this Court vide order dated
06.10.2016, while admitting the appea,l had directed the
appellant-Insurance Company to deposit entire award
amount to the concerned Tribunal and had thereby stayed
the impugned judgment and award pending the appeal. The
further directions were issued to the Tribunal to disburse
30% of the amount in terms of the award in favour of the
claimants and invest remaining 70% of the amount in fixed
deposit scheme with any nationalized bank with periodical
interest permitted to be withdrawn by the claimants. The
FDRs were directed to be renewed from time to time and
were made subject to the outcome of the present appeal.
3. The respondents-original claimants being duly served
with the admission of appeal, had appeared through learned
advocate and had preferred cross-objection mainly seeking
enhancement of the amount of compensation as awarded by
the Tribunal also raising the ground of 10% negligence
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being wrongly attributed to the deceased. The cross-
objection, were admitted and directed to be heard with the
First Appeal vide order dated 23.02.2017.
4. The First Appeal and cross-objections being notified for
final hearing were finally heard. The record reveals that the
advocate notice issued upon original claimants were duly
served, however, no appearance has been entered. With the
able assistance of learned advocate for the appellant-
Insurance Company, the appeal was finally heard and is
decided by this common judgment.
5 Learned advocate Mr. Sunil Parikh appearing for the
appellant-Insurance Company has assailed the impugned
judgment and award and the issue of liability by submitting
that the Tribunal committed grave error in holding the
appellant-Insurance Company liable to pay the amount of
compensation ignoring the fact that the driver of the Tata
mobile mid size pick up track bearing registration No.GJ-
3.Y-6823, was holding driving license to drive light motor
vehicle which was in force from 18.11.2003 to 17.11.2023.
He has further pointed out that the license produced on
record at Exh. 61 clearly shows that the driver was holding
license for a non-transport vehicle and there was no
endorsement of transport vehicle. The driver was, therefore,
not entitled to drive the commercial vehicle.
6. Considering the aforesaid submissions in response to
the query put by this Court with regard to the legal position,
learned advocate had fairly conceded to the settled
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principles laid down by the Hon’ble Supreme Court in the
case of M/s Bajaj Allianz General Insurance Co. Ltd. Vs.
Rambha Devi and ORs, reported at 2025 (3) SCC 95 .
Learned advocate had invited my attention to the R.C book
produced on record at Exh. 39 and has submitted that
considering the nature of vehicle being described as light
carriage vehicle and having cubic capacity of 2956 CC, it
would be in the category of light motor vehicle. He has
therefore, submitted that in view of the judgment of Hon’ble
Supreme Court in the case of Rambha Devi (supra), even in
absence of any further endorsement to operate ‘transport
vehicle’ in the driving license would not be required to drive
such vehicle. Learned advocate has therefore, urged this
Court to pass appropriate orders on the issue of license.
7. As regard the quantum of compensation is concerned,
learned advocate has invited my attention to the ground
raised in the cross-objection and has submitted that in view
of the evidence brought on record, the Tribunal has rightly
appreciated the income tax returns produced on record from
Exh. 50 to 51of A.Y. 2003-2004 and A.Y 2004-2005 for the
purpose of determination of income of the deceased. It was
further pointed out that though the income tax returns of
the A.Y 2005-2006 has also been produced on record by the
claimants, the same has rightly not been taken into
consideration. Noticing the fact that the aforesaid income
tax returns were filed after the accident and reflects the
highest income of the deceased, the same has been rightly
ignored. The learned advocate had, therefore, submitted
that the Tribunal had rightly considered the average of
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income reflected in A.Y 2003-2004 and 2004-2005 and has
fixed the income of the deceased as Rs. 4,808/- per month
which calls for no interference. It was further pointed out
that considering the age of the deceased and the vocation of
the deceased the Tribunal considering the settled legal
principles has applied 30% addition towards future rise of
the income. However, in view of the subsequent decision of
the Hon’ble Supreme Court in the case of National
Insurance Company Vs. Pranay Sethi reported in (2017)
16 SCC 680, considering the fact the age of deceased being
determined as 42 years and being self-employed, the
addition towards future rise is required to be reduced to
25% in the facts of the case. As regards deduction of 1/3rd
been taken into consideration, learned advocate has invited
my attention to the findings and reasons assigned and has
submitted that the deceased was survived by widow and
their two children. Considering the fact that there were
three dependents in the family of the deceased no error can
be found with the approach of the Tribunal in applying
1/3rd deduction towards personal and living expenses. He
has, therefore, urged this Court to reduce the amount of
compensation awarded under the head of dependency loss.
As regards the amount awarded towards medical expenses
is concerned, the same were not disputed. The amount
awarded under the non-pecuniary damages are concerned,
the same has been reasonably considered.
8. As regards amount of compensation under
conventional heads are concerned, learned advocate has
urged this Court to pass appropriate orders in light of the
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settled principles laid down by the Hon’ble Supreme Court
in the case of Pranay Sethi (supra). However, the attention
of this Court was invited to the fact that under the head of
funeral expenses, the Tribunal has already awarded amount
of Rs. 50,000/-. He has, therefore, objected to 10% rise to
be extended under the aforesaid head. Learned advocate
has, therefore, urged this Court to pass appropriate orders
in the appeal as well as in the cross-objections preferred by
the original claimants.
9. I have heard learned advocate appearing for the
appellant-Insurance Company. I have closely perused the
grounds raised by the original claimants in the cross-
objection.
10. At the outset it is required to be noted that despite
service of notice upon the original claimants, they have
chose not to appear and contest the appeal or to pursue the
cross-objection. However, considering the beneficial
legislation, the principles settled by the Hon’ble Supreme
Court for the purpose of determination of just and fair
amount of compensation, with the able assistance of
learned advocates for the appellant-Insurance Company this
Court has proceeded to re-appreciate the evidence in order
to consider the issue of quantum of compensation as well.
As regards the challenge on the issue of liability raised by
the appellant-Insurance Company is concerned as rightly
conceded by learned advocate for the appellant-Insurance
Company, in view of the settled principles laid down by the
Hon’ble Supreme Court in the case of Rambhadevi (supra),
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the issue is no more res integra. It is required to be noted
that the legal issue which arose for consideration before the
Bench of five judges in the aforesaid decision, the Court was
called upon to decide the reference as to whether under the
existing legal framework of Motor Vehicles Act, 1988 and
the Central Motor Vehicle Rules, 1989, a person holding
license for ‘light motor vehicle’ class can drive a ‘transport
vehicle’ without a specific endorsement, provided the “Gross
Vehicle Weight’ of the vehicle does not exceed 7500 kg?.
11. Answering the aforesaid reference, the Hon’ble
Supreme Court has held that fundamentally the Motor
Vehicle Act is a social welfare legislation enacted with the
objective of providing a mechanism for victims and their
families to seek compensation for loss or injury resulting
from road accidents. The Court further observed that being
a welfare legislation, it is required to be interpreted in a
manner so as to not to deprive the claimants of the benefit
of legislation. After considering the brief overview of the
Motor Vehicle Act, and the Motor Vehicle Rules and the
definitions of light motor vehicle in context with Section 3
which provided the necessity for driving license and
considering Section 10 which suggested that the primary
target was towards transport vehicle as opposed to light
motor vehicles which as earlier noticed could also be a non
transport vehicle, the Court found that considering Sub
Section 2 of Section 10 which states that a ‘driving license
‘shall also be expressed as entitling the holder to drive a
motor vehicle of one or more of the following classes’ had
therefore held that the driver of the ‘light motor vehicle’ is
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not per se disentitled to acquire a license for a ‘transport
vehicle’ class. The Court further observed that for driving
the vehicles above the weight of 7500 kg or those classes
which do not fall in the definition of light motor vehicles
under Section 2(21). Thus, it was held that separate
endorsement of transport vehicle was not necessary as the
LMV license would suffice for vehicles below 7500 kg weight.
Considering the aforesaid principles in the facts of the case,
if one looks at the R.C book of the insured vehicle of the
appellant, produced on record at Exh. 39, as rightly
submitted by learned advocate for the appellant, the class
vehicle is described as light carrier vehicle (LCV) having
cubic capacity of 2956 CC. Considering the nature of the
aforesaid vehicles, the Tribunal has rightly not entertained
the issue of liability as raised by the appellant Insurance
Company by treating it as light motor vehicle.
12. Considering the fact that the driver of the insured
vehicle was holding driving license to drive light motor
vehicle even in absence of any endorsement to drive
transport vehicle, the Tribunal rightly held that no breach of
terms and conditions has been involved so as to exonerate
the appellant-Insurance Company from its liability to pay
amount of compensation.
13. Having held so, the quantum of compensation is
required to be revisited. The income tax returns of the
deceased have been produced on record at Exhs. 50 and 51.
I have carefully gone through the income tax returns of A.Y
2003-2004 as well as A.Y 2004-2005.
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13.1 It transpires that under the head of computation of
income the deduction is made towards the interest paid on
the housing loan for a sum of Rs. 30,350/-. The profit/loss
has been reflected under the head of business or profession
income Rs. 59,634/-. The gross total income thus comes to
Rs.73,050/-. However, the Tribunal has considered the
income of Rs. 59,700/- instead of Rs. 73,050/- by
deducting the amount of interest paid towards the housing
loan which is Rs. 13,350/-. Similarly, in the income tax
returns of A.Y 2004-2005, the Tribunal has not taken into
consideration a sum of Rs. 11,409/- from the
business/professional income of Rs.67,100/-.
13.2 Having appreciated the aforesaid documents and
considering the well settled principles laid down by the
Hon’ble Supreme Court in the case of Pranay Sethi (supra),
in my view the Tribunal committed error in deducting the
aforesaid amount paid towards interest of housing loan
availed by the deceased. As held by the Hon’ble Supreme
Court, the income for the purpose of determination of
dependency loss or future prospective income of the victim
of the accident has to be the income minus tax. Following
the aforesaid principles, the Tribunal ought to have taken
into consideration the gross total income of the deceased
which was Rs. 73,050/- for A.Y 2003-2004 and Rs.
67,100/- for A.Y 2004-2005.
13.3 Having noted so, the Tribunal has not taken into
consideration the income tax returns of A.Y 2005-2006
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produced on record for the reason that the said income tax
returns has been submitted after the occurrence of
accident. Indisputably, the accident had taken place on
07.05.2005 whereas the income tax returns of A.Y 2005-
2006 has been submitted on 04.06.2005 which is after the
date of accident. In absence of any corroborative material in
the nature of books of accounts, bank statement being
produced on record, the Tribunal has rightly not taken into
consideration the income tax returns of A.Y 2005-2006 for
the purpose of determination of income of the deceased.
Considering the average of the income of A.Y 2003-2004
and A.Y 2004-2005 the income of the deceased is
determined as Rs. 73,050/- per annum instead of Rs.
57,695/- as determined by the Tribunal. It is also required
to be noted that as against the aforesaid the gross income of
the deceased is Rs. 970/- has been paid towards tax for A.Y
2003-2004 and Rs. 569/- has been paid towards tax A.Y.
2004-2005. Thus, considering the net income after
deducting the tax paid, the net income of the deceased for
A.Y 2003-2004 is Rs. 72,080/- and for A.Y 2004-2005 is Rs.
66,531/-. Considering the average of the income of the
aforesaid two assessment years, the annual income of the
deceased is determined as Rs. 69,305.5/- rounded to Rs.
69,306/-. The monthly income of the deceased is thus,
fixed as Rs.5,776/- instead of Rs. 4,808/- as determined
by the Tribunal.
14. This brings me to the aspect of prospective
income of the deceased in view of the settled principles laid
down by the Hon’ble Supreme Court in the case of Pranay
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Sethi (supra), considering the fact that the age of the
deceased was fixed as 42 years and being self employed as
rightly submitted by learned advocate for the appellant-
Insurance Company, the prospective income of the deceased
is required to be revisited by considering 25% addition
instead of 30%, as awarded by the Tribunal.
15. Considering the monthly income of the deceased
as Rs. 5,776/- and the fact that the age of the deceased is
determined as 42 years and wa self-employed
it would be appropriate to consider addition of 25% future
rise towards prospective income of the deceased. The
prospective income of the deceased is determined thus
determined as Rs. 7,220/- per month. As regards deduction
is concerned in the facts of the case where the deceased was
survived by three dependents in the family, the Tribunal has
rightly applied 1/3rd deduction towards personal and living
expenses of the deceased. The loss suffered by the claimants
towards the prospective income of the deceased is thus
determined as Rs. 4,814/- per month (Rs. 7,220/- minus
Rs. 2,406/-). As regards multiplier to be adopted,
considering the age of the deceased in the age group of 41 to
45 years, the Tribunal has rightly applied multiplier of 14.
Considering the aforesaid components, the dependency loss
is determined as Rs. 8,08,752/- instead of Rs. 7,00,056/-
determined by the Tribunal.
16. As regards the amount of compensation under
medical expense is concerned, the Tribunal upon
appreciation of evidence brought on record has awarded Rs.
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76,000/-, in absence of any challenge being made, the same
is hereby confirmed.
17. The amount under the head of attendant, and
transportation expenses has also been taken into
consideration by the Tribunal. Noticing the fact that
deceased had survived for 10 days and had unfortunately
succumbed to the accident on 17.05.2005, the Tribunal has
rightly awarded under the said head. Similarly the Tribunal
has rightly considered the amount of Rs. 25,000/- under
the head of pain, shock and suffering.
18. This brings me to the amount awarded under the
conventional heads. Considering the settled principles laid
down by the Hon’ble Supreme Court in the case of Pranay
Sethi (supra), the deceased being survived by the wife and
two children, the amount awarded under the head of loss of
consortium and loss of love and affection, is required to be
revisited. Considering the fact that the claimants have
persued the cross-objections essentially praying for
enhancement of amount of compensation, they shall be
entitled to benefit of 10% rise as directed by the Hon’ble
Supreme Court in the case of Pranay Sethi (supra), after
the pronouncement of the judgment. Thus, the wife of the
deceased is hereby held entitled to loss of consortium of
sum of Rs. 48,400/- instead of Rs. 25,000/- as awarded by
the Tribunal. The children of the deceased having lost their
father at an early age, shall be entitled to the amount
towards parental consortium which has otherwise been
considered by the Tribunal under the head of love and
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affection being confined to Rs. 50,000/- which is
redetermined as Rs. 48,970400/- to be awarded to each
child. The Tribunal has lost sight of awarding amount of
compensation under the head of loss of estate. It would be
appropriate to consider the amount of Rs. 18,150/- under
the aforesaid head. As regards the objection being raised by
learned advocate appellant-Insurance Company, the
objections being raised by learned advocate appellant-
Insurance Company with regard to enhancement sought for
under the funeral expenses is concerned, having noted the
fact that the funeral expenses has been awarded at relevant
stage, however, considering the fact that the claimants have
pursued the matter in cross-objection praying for
enhancement of quantum of compensation, they shall be
entitled to 10% rise as directed by Hon’ble Supreme Court.
The claimants therefore, shall, therefore, be entitled to
amount of Rs. 18,150/-under the head of funeral expenses
as well.
19. Lastly, the issue of negligence has also been
raised by the original claimants in their cross-objections. I
have carefully considered the findings and reasons assigned
by the Tribunal on the issue of negligence. Having perused
the FIR and the panchnama produced on record, it
transpires that the accident had taken place at cross-roads.
Considering the fact that the right rear portion of the scooty
driven by the deceased was damaged as against that the
insured vehicle was damaged on the left side of the door of
the body, no error can be found with the finding of the
Tribunal holding the deceased 10% contributory negligent
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towards the occurrence of accident.
20. In view of the above discussion, the total amount of
compensation is being redetermined, and the same is
reproduced in a tabular form:-
Sr.No
Details Tribunal
Final
Amount
.
(Rs.)
(Rs.)
1. Dependency loss 7,00,056/- 8,08,752/-
2. Medical expenses 76,000/- 76,000/-
3. Attendant
transportation charges
5,000/- 5,000/-
4. Pain, shock and
25,000/- 25,000/-
suffering
5. Funeral expenses 15,000/- 18,150/-
6. Loss of spousal
25,000/- 48,400/-
consortium
6. Loss of parental
consortium(Love,
50,000/- 96,800/-
affection)
7. Loss of estate 2,500/- 18,150/-
8. Total amount of
8,73,556/- 10,96,252/-
compensation
10. 10% negligence
8,03,55/- 9,86,627/-
deducted
21. Considering the fact that the deceased has also been
held 10% negligent towards the occurrence of accident, the
original claimants shall be entitled to Rs. 9,86,627/- with
interest at the rate of 9% from the date of filing of the claim
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petition till its actual realisation with proportionate costs
from the original opponents, jointly and severally.
22. For the foregoing reasons, the First Appeal is
dismissed whereas the cross-objections are partly allowed.
In view thereof, the impugned judgment and award dated
20.06.2016 passed by the Motor Accident Claims Tribunal
(Special), Rajkot in MACP No. 626 of 2005 is hereby
modified by holding the claimants entitled to total amount
of compensation Rs. 9.86,627/- instead of Rs. 8,03,551/- as
awarded by the Tribunal. In view of the aforesaid directions,
the appellant Insurance Company is hereby directed to
deposit the enhanced amount of compensation of Rs.
1,83,076/- with interest and proportionate costs as awarded
by this Court right from filing of the claim petition till its
actual realisation, with the concerned Tribunal within a
period of 6 weeks from the date of receipt of certified copy of
this judgment.
23.1 On deposit of the enhanced amount of compensation,
the Tribunal shall be at liberty to proceed with the release
and disbursement of the entire awarded amount in favour of
the claimant, subject to the verification and strictly
adhering to the guidelines of Hon’ble Supreme Court in this
regard. It is required to be noted that the claimants have
chosen not to appear and pursue the proceedings however,
in view of the enhanced amount of compensation being
awarded the Secretary attached to the Legal Service
Authority, Rajkot is requested to bring to the notice of the
claimants about the present order. The Tribunal shall
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undertake such exercise of disbursement of the award
amount in favour of the claimants within a period of two
weeks thereafter.
24. With these observations the First Appeal as well as
cross-objections stand disposed of in the aforesaid terms.
25 The Record and proceedings are directed to be sent
back to the concerned Tribunal forthwith with the writ of
this judgment. Let copy of writ of this judgment be
forwarded to the Secretary, District Legal Service authority,
Rajkot for compliance of directions.
(NISHA M. THAKORE,J)
MARY VADAKKAN
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