Insurer must satisfy the award first and recover from the vehicle owner for breach of permit conditions.

On 14 December 2019, a Mahindra Bolero struck pedestrians R. Shanthamma and G. Vannuramma.

Shanthamma died from her injuries, and Vannuramma was injured.

The Tribunal awarded Shanthamma’s legal representatives ₹12,70,000 and directed the insurer to pay; it also awarded compensation in Vannuramma’s claim.

Shanthamma’s legal representatives appealed for enhancement, while the insurer appealed in both claims, challenging liability on the ground that the vehicle lacked a permit.

The High Court considered Shanthamma’s appeal only for enhancement; Vannuramma did not appeal.

1. Whether the compensation awarded to Shanthamma’s legal representatives was inadequate and required modification

2. Whether the Tribunal was justified in directing the insurer to pay compensation in both claim petitions

Under Sarla Verma v. Delhi Transport Corporation, the applicable multiplier for a deceased aged 46–50 is 13.

Under National Insurance Co. Ltd. v. Pranay Sethi, future prospects are added to established income; for a deceased aged 40–50, the addition is 25%, and one-fourth of income is deducted for personal expenses where there are four dependants.

The conventional heads of funeral expenses, loss of estate and consortium are subject to the applicable enhancement.

Section 66(3)(i) of the Motor Vehicles Act, 1988 was considered in relation to the permit requirement; the Tribunal’s view that no permit was required because the vehicle’s gross weight was below 3,000 kg was held legally incorrect.

The Court applied a pay-and-recover approach where the insurer’s policy was in force but a breach concerning the permit was established.

The Court treated the accident and the vehicle’s involvement as undisputed.

It corrected the Tribunal’s age assessment, finding that the deceased was 48, applied multiplier 13, and added 25% future prospects.

For income, it adopted the Karnataka State Legal Services Authority’s 2019 guideline of ₹13,250 per month, rather than the Tribunal’s ₹8,000 assessment; after deducting one-fourth for personal expenses, it calculated loss of dependency at ₹19,37,832.

It enhanced the conventional heads, bringing total compensation to ₹21,46,832.

On liability, the policy was valid on the accident date, but the Tribunal’s conclusion that a permit was unnecessary was incorrect.

The Court therefore held that the insurer must satisfy the award first and may recover from the vehicle owner.

It allowed the insurer’s appeals, modified the Tribunal’s judgment, and directed the insurer to deposit the enhanced compensation with 6% interest from the petition date, excluding the 434-day delay period, within six weeks; the insurer may then recover the amount from the vehicle owner.