Pleadings alone cannot establish breach of a driving-licence condition without supporting evidence from the insurer.

Deepakkumar Babuji Sajiya, aged 27 years and employed as a Junior Assistant with UGVCL, was riding motorcycle No. GJ-8-L-8043 towards Ambaji on 16 August 2014 when a jeep bearing No. GJ-8-AE-4087, allegedly driven rashly and negligently at excessive speed, collided with him on the Danapura Pimpali–Gola Highway road.

He died at the spot, and an FIR was registered against the jeep driver.

The deceased left behind his widow, minor son and mother and was earning approximately Rs.26,449 per month.

The Motor Accident Claims Tribunal awarded Rs.46,55,856 with interest at 7.5% per annum.

The insurer challenged the award under Section 173 of the Motor Vehicles Act, principally alleging that the jeep driver did not possess a valid and effective driving licence.

The claimants filed cross-objections under Order XLI Rule 22 CPC seeking enhancement on the ground that the Tribunal had excluded certain salary components and had improperly deducted income tax.

Whether the insurer established that the jeep driver did not possess a valid and effective driving licence on the date of the accident, thereby proving a breach of the insurance policy conditions?

Whether the Tribunal correctly assessed the deceased’s income for calculating loss of dependency, particularly regarding allowances, professional tax, income tax and future prospects?

Whether the claimants were entitled to enhancement under the conventional heads of compensation, including loss of consortium, funeral expenses and loss of estate?

The Court exercised appellate jurisdiction under Section 173 of the Motor Vehicles Act and considered the claimants’ cross-objection under Order XLI Rule 22 CPC.

A plea in the insurer’s written statement alleging absence of a valid driving licence does not, by itself, constitute proof of the alleged policy breach; the insurer must produce evidence establishing the violation.

For computation of motor accident compensation, salary components such as dearness allowance, house rent allowance, transport allowance, special allowance, provident fund-related contributions and other employment benefits may be included where they form part of the deceased’s income or benefit the family.

The Court relied on Meenakshi v. The Oriental Insurance Co. Ltd., 2024 INSC 573; Raghuvir Singh Matolya v. Hari Singh Malviya; National Insurance Co. Ltd. v. Indira Srivastava, (2008) 2 SCC 763; and National Insurance Co. Ltd. v. Nalini, decided on 11 July 2024.

The Court also applied a 50% addition for future prospects, a 17-year multiplier, a one-third deduction towards personal expenses, and the applicable conventional amounts for consortium, funeral expenses and loss of estate.

The insurer failed to produce any documentary or oral evidence demonstrating that the jeep driver lacked a valid and effective licence.

Although the driver had been served, he did not enter the witness box, and the insurer did not summon or examine him to prove the alleged breach.

The Court therefore held that the plea could not be sustained merely on the basis of the written statement, which is not evidence by itself.

On quantum, the salary slip showed total earnings of Rs.26,449.94.

The Tribunal had considered only basic salary, dearness allowance and house rent allowance and had deducted income tax, even though the employer had not deducted such tax.

Applying the cited Supreme Court authorities, the Court treated the relevant salary benefits as part of the deceased’s income, deducted only Rs.200 towards professional tax, added 50% for future prospects, applied the multiplier of 17 and deducted one-third for personal expenses.

The resulting loss of dependency was calculated at Rs.53,54,728, and additional amounts were awarded under the conventional heads.

The claimants’ cross-objection was allowed to the extent that the total compensation was enhanced from Rs.46,55,856 to Rs.55,36,228, comprising Rs.53,54,728 for loss of dependency, Rs.1,45,200 for loss of consortium, Rs.18,150 for funeral expenses and Rs.18,150 for loss of estate.

The enhanced amount of Rs.8,80,372 was directed to be deposited by the insurer before the Tribunal within eight weeks, with interest at 7.5% per annum from the date of filing of the claim petition until realization.

The Tribunal was directed to disburse the awarded amount, subject to verification, procedure and deduction of applicable court fees.