Driver Who Lost Sight In One Eye Keeps ₹7.5 Lakh Personal-Accident Award, Though Karnataka HC Removes Interest

In brief

The question

1. Whether the insurer established that the Tribunal’s judgment and award were contrary to law, including its award of Rs.7,50,000 under the policy.

The court held

The Court answered the challenge to the principal compensation in the negative and held that the insurer remained liable to pay Rs.7,50,000.

It also directed

It also answered the interest issue in the negative, set aside the award of interest, and allowed the appeal in part.

The insurer was directed to deposit Rs.7,50,000 before the Tribunal within four weeks of receiving the certified copy of the judgment.

01Facts

On 28 September 2021, Siddappa was driving his insured vehicle when an unidentified vehicle allegedly braked suddenly, causing an accident in which he sustained injuries and lost the vision in his right eye.

pp. 2–4

He sought compensation from Reliance General Insurance under the policy, which included personal-accident cover.

pp. 2–4

The Tribunal awarded him Rs.7,50,000 with interest at 6% per annum.

pp. 2–4

The insurer appealed, challenging its liability and the award of interest.

pp. 2–4

The insurer’s policy was produced before the Tribunal, and the insurer had stated in its objections that the policy provided Rs.7,50,000 for loss of sight in one eye.

p. 7

02Issues

i.1. Whether the insurer established that the Tribunal’s judgment and award were contrary to law, including its award of Rs.7,50,000 under the policy.

p. 5

ii.2. Whether the Tribunal was justified in awarding interest on the compensation.

p. 5

03Law Applied

The appeal was brought under Section 173(1) of the Motor Vehicles Act, 1988.

p. 1

The Court treated the insurer’s liability for the personal-accident benefit as contractual and assessed it by reference to the policy terms and the insurer’s admission in its objections.

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It held that interest on the contractual benefit could not be awarded in the absence of a contractual basis for interest.

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Provisions in the judgment · 4 · Linked ones open on LawLens

Motor Vehicles Act, 1988 Section 173 Section 163

Indian Penal Code, 1860 Section 279 Section 338

04Reasoning

The insurer’s objection acknowledged that the policy provided Rs.7,50,000—50% of the stated Rs.15,00,000 death benefit—for loss of sight in one eye.

pp. 6–8

The medical records supported Siddappa’s injury, and the insurer produced the policy but led no oral evidence.

pp. 6–8

The Court therefore found no basis to disturb the Tribunal’s award of Rs.7,50,000.

pp. 6–8

However, because the liability was contractual and the Court found no agreement providing for interest on that amount, it set aside the interest award.

p. 8