KAVITA W/O SHIVANAND KHANNAVAR, vs MARUTI BASAGOUDA MALAGOUDANAVAR,

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MFA No. 103406 of 2014
C/W MFA No. 23555 of 2012

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R




IN THE HIGH COURT OF KARNATAKA
AT DHARWAD

TH
DATED THIS THE 24 DAY OF APRIL, 2026

BEFORE

THE HON'BLE MR. JUSTICE RAVI V.HOSMANI

MISCELLANEOUS FIRST APPEAL NO.103406/2014 (MV)
C/W
MISCELLANEOUS FIRST APPEAL NO. 23555/2012 (MV)

IN MFA NO.103406/2014:

BETWEEN:

SRI MARUTI BASAGOUDA MALAGOUDANAVAR,
AGE: 37 YEARS, OCC: BUSINESS,
R/O: AT POST HARAGAPUR,
TAL: HUKKERI, DIST: BELAGAVI.
(OWNER OF MAHINDRA JEEP
BEARING NO.KA-23/M-1655)

















…APPELLANT
(BY SMT.ARCHANA A. MAGADUM, ADVOCATE)

AND:

1. SMT.KAVITA
W/O SHIVANAND KHANNANAVAR,
AGE: 33 YEARS, OCC: HOUSEHOLD WORK,
R/O: HARAGAPUR,
TQ: HUKKERI, DIST: BELAGAVI.

2. KUMARI SHRUTI
D/O SHIVANAND KHANNANVAR,
AGE: 8 YEARS, OCC: NIL,
R/O: HARAGAPUR,
TQ: HUKKERI, DIST: BELAGAVI.

3. KUMARI MALASHRI
D/O SHIVANAND KHANNANVAR,

CHANDRASHEKAR
LAXMAN
KATTIMANI

Digitally signed by
CHANDRASHEKAR
LAXMAN KATTIMANI
Location: High Court of
Karnataka, Dharwad Bench
Date: 2026.04.29 10:38:26
+0530

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AGE: 7 YEARS, OCC: NIL,
R/O: HARAGAPUR,
TQ: HUKKERI, DIST: BELAGAVI.

RESPONDENTS NO.2 AND 3 BEING MINORS,
R/BY THEIR GUARDIAN NATURAL MOTHER,
SMT.KAVITA W/O SHIVANAND KHANNANAVAR.

4. SMT.LAXMIBAI
SHANKAR KHANNANAVAR,
AGE: 64 YEARS, OCC: HOUSEHOLD WORK,
R/O: HARAGAPUR,
TALUK: HUKKERI, DIST: BELAGAVI.

5. THE UNITED INDIA INSURANCE COMPANY LTD.,
ST
BR OFFICE NO.24, 1 FLOOR,
ASHOK NAGAR NIPPANI-591237,
THROUGH ITS DIV. MANAGER,
UNITED INDIA INSURANCE COMPANY LTD.,
MARUTI GALLI, BELAGAVI.
…RESPONDENTS
(BY SRI VITTHAL S. TELI, ADVOCATE FOR R1 TO R4;
SRI RAVINDRA R. MANE, ADVOCATE FOR R5;
R2 AND R3 ARE MINORS R/BY R1)

THIS MFA IS FILED UNDER SECTION 173(1) OF THE MOTOR
VEHICLES ACT, PRAYING TO MODIFY THE JUDGMENT AND AWARD
DATED 18.05.2012 PASSED BY THE PRL. SR. CIVIL JUDGE AND
ADDL. MACT BELAGAVI PASSED IN MVC NO.1601/2011 BY
ALLOWING THE CLAIM PETITION IN THE INTEREST OF JUSTICE AND
EQUITY.

IN MFA NO. 23555/2012:

BETWEEN:

1. SMT.KAVITA W/O SHIVANAND KHANNANAVAR,
AGE: 31 YEARS, OCC: HOUSEHOLD WORK,
2. KUMARI SHRUTI
D/O SHIVANAND KHANNANAVAR,
AGE: 6 YEARS, REST-DO-

3. KUMARI MALASHRI
D/O SHIVANAND KHANNANAVAR,

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AGE: 5 YEARS, REST-DO-
APPELLANT NO.2 AND 3 BEING MINORS
R/BY THEIR GUARDIAN NATURAL MOTHER
SMT.KAVITA SHIVANAND KHANNANAVAR,
APPELLANT NO.1.

4. SMT.LAXMIBAI SHANKAR KHANNANAVAR,
AGE: 61 YEARS, OCC: HOUSEHOLD WORK,
ALL ARE R/O: HARAGAPUR,
TALUK: HUKKERI, DIST: BELGAUM.
...APPELLANTS
(BY SRI VITTHAL S. TELI, ADVOCATE)

AND:

1. SRI MARUTI BASAGOUDA MALAGOUDANAVAR,
AGE: MAJOR, OCC:: BUSINESS,
R/O: AT POST: HARAGAPUR,
TALUK: HUKKERI, DIST. BELAGAVI.

2. UNITED INDIA INSURANCE COMPANY LTD.,
ST
BR. OFFICE NO.24, 1 FLOOR,
ASHOK NAGAR, NIPPANI 591237.
THROUGH ITS DIV. MANAGER,
UNITED INIDA INSURANCE COMPANY LTD.,
MARUTI GALLI, BELGAUM.
...RESPONDENTS
(BY SMT.SUNANDA P. PATIL, ADVOCATE FOR R1;
SRI RAVINDRA R. MANE, ADVOCATE FOR R2)

THIS MFA IS FILED UNDER SECTION 173(1) OF MOTOR
VEHICLES ACT, AGAINST THE JUDGMENT AND AWARD DATED
18-05-2012 PASSED IN MVC.NO.1601/2011 ON THE FILE OF
PRL. SENIOR CIVIL JUDGE AND ADDL. MACT, BELGAUM, PARTLY
ALLOWING THE CLAIM PETITION FOR COMPENSATION AND
SEEKING ENHANCEMENT OF COMPENSATION & ETC.

THESE APPEALS COMING ON FOR ADMISSION, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: THE HON'BLE MR. JUSTICE RAVI V.HOSMANI

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ORAL JUDGMENT

Challenging judgment and award dated 18.05.2012 passed
by Principal Senior Civil Judge and Additional MACT, Belagavi at
Belagavi, (‘ Tribunal’ for short) in MVC no.1601/2011, these
appeals are filed.

2. MFA no.103406/2014 is filed by owner, while MFA
no.23555/2012 is filed by claimants challenging finding of
tribunal on liability as well as for enhancement.

3. Sri Vitthal S. Teli, learned counsel for claimants
submitted, at 16:30 hours on 26.04.2010, when Shivanand
Khannanavar was travelling in Mahindra Jeep no.KA-23/M-1655
on NH4, due to rash and negligent driving of Jeep, he fell down
from it, sustained grievous injuries and shifted to Government
Hospital, Sankeshwar and later to KLE Hospital, Belagavi, but
died on same day at 08.00 p.m. Alleging loss of dependency his
wife, children and mother filed claim petition against owner and
insurer of Mahindra Jeep.

4. On contest wherein claim petition was opposed on
all grounds, tribunal framed following issues:

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“[1] Whether the petitioners prove that alleged
accident in question was occurred due to rash
and negligent driving of Mahindra Jeep bearing
no.KA-23/M-1555 and the deceased Shivanand
Shankar Khananavar died in the accident as
alleged?

[2] Whether the said Mahindra Jeep bearing no.KA-
23/M-1655 was insured with the respondent
No.2 and the drivers of Mahindra Jeep bearing
no.KΑ-23/M-1655 was holding valid and
effective D.L. on the date of alleged accident?

[3] Whether the petitioners are entitled for
compensation? If so, for what amount and
from whom?

4] What award or order?”

5. In trial, claimant no.1 deposed as PW1 and got
marked Exs.P1 to P11. Insurer did not lead oral evidence but
got marked copy of insurance policy with consent as Ex.R1.

6. On consideration, tribunal held accident occurred
due to rash and negligent driving of Jeep by its driver assessed
compensation of ₹7,30,500/- with interest at 6% per annum
and held owner liable to pay same. It absolved insurer on
ground that vehicle in question was covered by ‘Act Liability
Only Policy’ and deceased was an inmate, whose risk could not
be covered. Aggrieved, owner and claimants filed these appeals
challenging finding on liability and for enhancement
respectively.

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7. Insofar as liability it was submitted, there was no
dispute about occurrence of accident, death of Shivanand
Khannanavar and claimants being entitled for compensation.
Only question was, whether insurer can escape from liability to
pay compensation to claimants. Relying upon decision of
Hon'ble Supreme Court in case of Sunita and Ors. v. United
India Insurance Co. Ltd. ( Sunita ) reported in AIR Online
2025 SC 601 , learned counsel submitted, Hon'ble Supreme
Court under similar circumstances in case of death of driver of
vehicle issued with an ‘Act Liability Only Policy’ had specifically
held merely on ground of ‘Act Liability Only Policy’ and no
premium paid to cover risk of driver, owner or gratuitous
passenger in motor vehicle, Courts would not be justified in
discharging insurance company from liability and propounded
‘pay and recover’ principle. It was submitted, in view of same,
insurer was liable to pay compensation to claimants and
thereafter recover it from insured.

8. On quantum, it was submitted, as on date of
accident, Shivanand Khannanavar was 28 years of age, doing
bakery business as well as agriculture and earning ₹15,000/-

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per month in total. However, tribunal considered his notional
income at only ₹4,500/- per month which was not justified.
Tribunal also failed to add future prospects at 40% and
awarded inadequate compensation under conventional heads
and sought enhancement.

9. Smt.Archana A. Magadum, advocate adopted said
submission.

10. On other hand, Sri RR Mane, learned counsel
appearing for insurer opposed both appeals. It was submitted,
there was no dispute about occurrence of accident involving
insured vehicle and leading to death of Shivanand
Khannanavar. It was also not in dispute that, vehicle was
insured with an ‘Act Liability Only Policy’ as per Ex.R1, with no
additional premium being paid to cover risk of passengers. It
was submitted normally principle of ‘pay and recover’ is applied
in case of breach of terms and conditions of policy. In instant
case, there was no breach of terms and conditions of policy as
there was no coverage of risk of passenger. Therefore ratio of
decision in Sunita would not apply as it was a case involving
death of driver of insured vehicle and as such distinguishable

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on facts. In support of his submission, counsel relied upon
decision of Hon’ble Supreme Court in case of National
Insurance Company v. Balakrishnan and Anr.
( Balakrishnan) reported in (2013) 1 SCC 731. Apex Court
held at paragraph no.17 as follows:
17. In New India Assurance Co. Ltd. v. Sadanand
Mukhi [(2009) 2 SCC 417 : (2009) 1 SCC (Civ) 571 :
(2009) 1 SCC (Cri) 815] the son of the owner of the
insured while driving the motorcycle met with an accident
and died. The accident allegedly took place as a stray dog
came in front of the vehicle. The stand of the insurance
company was that in view of the relationship between the
deceased and the owner of the vehicle being father and
son, the deceased was not a third party. The Bench relied
on the decisions in Tilak Singh [(2006) 4 SCC 404 :
(2006) 2 SCC (Cri) 344] , Jhuma Saha [(2007) 9 SCC 263
: (2007) 3 SCC (Cri) 443] , Meena Variyal [(2007) 5 SCC
428 : (2007) 2 SCC (Cri) 527] , Laxmi Narain
Dhut [(2007) 3 SCC 700 : (2007) 2 SCC (Cri) 142]
and United India Insurance Co. Ltd. v. Davinder
Singh [(2007) 8 SCC 698 : (2007) 3 SCC (Cri) 664] and
came to hold that the insurance company was not liable
to indemnify the owner.”

11. It was submitted, said decision was rendered after
referring to various decisions on point and holding insurer not
liable. Based on same learned counsel sought for dismissal of
appeal against insurer.

12. Heard learned counsel, perused impugned
judgment, award and record.

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13. From above, points that arise for consideration are:
(i) Whether tribunal was justified in dismissing
claim petition against insurer? And

(ii) Whether claimants are entitled for
enhancement of compensation?

14. Point no.(i) : In view of nature of contentions
urged, there is no dispute about occurrence of accident
involving insured vehicle leading to death of Shivananda
Khannanavar, due to rash and negligent driving of insured
vehicle by its driver. There is also no dispute about fact that as
on date of accident vehicle was covered under an ‘Act Liability
Only Insurance Policy’, which covers risk against third party
claims and not owner, driver or occupants of vehicle. Claimants
contend even in such case, there has to be order of ‘pay and
recover’ against insurer. Said issue has been answered by
Hon'ble Supreme Court in favour of claimants in case of
Sunita .

15. Though learned counsel for insurer relies on
Balakrishnan's case, question involved therein as stated by
Hon’ble Supreme Court was whether Policy therein was an ‘Act

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Liability Only Policy’ or a ‘Comprehensive Package Policy’. In
said context and noting that no premium was paid to cover risk
of passengers, it was held claimants cannot seek compensation
from insurer. Finding in Sunita ’s case would not directly
militate against ratio in Balakrishnan's case and there is only
addition of direction to pay and recover. Hence, point no.(i) is
answered in negative. Insurer is held liable to pay
compensation to claimant in first instance and thereafter
recover it from insured.

16. Point no.(ii): Though claimant stated that
deceased was 28 years of age, doing bakery business as well as
agriculture and earning ₹15,000/- per month, same was not
substantiated with any specific material. In absence, income
was assessed notionally at ₹4,500/- instead of ₹5,500/-, being
notional income fixed for year 2010. Same has to be
considered.

17. Claimants are wife, two children and mother of
deceased i.e., four in number and deceased was self-employed
and below 40 years. As per decision of Hon'ble Supreme Court
in National Insurance Company Limited v. Pranay Sethi

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and Ors ., ( Pranay Sethi ) reported in 2017 (16) SCC 680 ,
future prospects at 40% have to be added to his monthly
income and deduction towards personal expenses has to be
th
1/4 and multiplier applicable would be ‘17’. Thus
compensation towards loss of dependency would be:
th
₹5,500/- + (40%) – 1/4 X 12 X 17 = Rs.11,78,100/- .

18. Apart from said compensation, claimants would be
entitled for spousal consortium, filial consortium and parental
consortium at ₹40,000/- each i.e., Rs.1,60,000/-
(Rs.40,000/- x 4). In addition, they would be entitled
₹15,000/- towards ‘funeral expenses’ and ₹15,000/- towards
‘loss of estate’, i.e., ₹30,000/- . As per decision in Pranay
Sethi , they would be entitled for addition of escalation of 20%,
(i.e., 10% for every three years), which would be ₹38,000/- .
Thus total compensation would be ₹14,06,100 /-. Point no.(ii)
is answered partly in affirmative. Consequently following:
ORDER

(i) Both appeals are allowed in part.

(ii) Judgment and award dated 18.05.2012 passed
by Tribunal in MVC no.1601/2011 stands
modified.

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(iii) Claimants are held entitled for total
compensation of Rs.14,06,100/- as against
Rs.7,30,500/- with interest at 6% per annum
from date of claim petition till deposit.

(iv) Insurer is directed to deposit same within 6
weeks before tribunal in first instance and
thereafter recover it from insured.

(v) Directions issued by Tribunal regarding
apportionment, deposit and release shall apply
to reassessed compensation proportionately.

(vi) Statutory amount in deposit in owner's appeal
is order to be transmitted to tribunal for
payment.


Sd/-
(RAVI V.HOSMANI)
JUDGE
EM
CT:VP
LIST NO.: 1 SL NO.: 7