Oriental Fire and General Insurance Company Ltd. vs Sushila Sondhi and Others

S.S. Sodhi, J.—On October 22, 1970 at about 6 p.m. there was an accident near village Bemni Khera on the Delhi-Mathura Road between a car CD 3634 which was coming from the side of Mathura and a tanker DIL 4687 going in the opposite direction. Three women travelling in this car were killed; while the fourth was seriously injured. Amongst those killed was Miss Savita Sondhi.

Mrs. Sushila Sondhi mother and Madhu and Deepa Sondhi, sisters of the deceased sought Rs. 50,000/- as compensation for the loss suffered by them on account of the death of the deceased. A sum of Rs. 25,000/- was awarded as compensation to the claimants.

It may be mentioned here that the finding of the Tribunal was that the claimants had failed to prove that the accident had been caused by the rash and negligent driving of the driver of the tanker, but the claimants were awarded compensation following the judgment of the High Court of Bombay in Marine and General Insurance Company Ltd. v. Balkrishna Ramchandra Nayan 1976 ACJ 288 (Bombay), where it was held that every person injured by the use of a motor vehicle must be awarded such compensation as appeals to the Tribunal to be just whether or not the Respondent was at fault or negligent. This view was overruled by the Supreme Court in Minu B. Mehta v. Balkrishna Ramachandra Nayan, 1977 ACJ 118 , where it was observed that the concept of liability without negligence was wholly opposed to the basic principles of law.

This order will dispose of three appeals arising from the impugned award of the Tribunal. One being by Gopi Nath, the owner of the tanker, involved in the accident, questioning his liability for payment of compensation in this case in view of the finding that there was no negligence on the part of the driver of the tanker. The other being by the Respondent insurance company seeking to avoid liability, firstly, on the ground that the owner of the tanker was not liable for payment of any compensation and then that at any rate the insurance policy had been rendered void by the non-disclosure and misrepresentation of material facts. This plea being founded upon the fact that in the proposal form the vehicle was described as a truck; whereas it was, in fact, a tanker. The claimants in turn sought enhanced compensation in the appeal filed by them.

The first question which arises for determination in this appeal is with regard to the issue of negligence.

According to the claimants the accident took place due to the rash and negligent driving of the driver of the tanker. It was said that the tanker had come from the side of Delhi at a terrific speed on the wrong side of the road and had hit into the car and the driver of the tanker thereafter ran away.

The version of the Respondents, on the other hand, was that the accident was caused entirely due to the negligence of the driver of the car. It was stated in the return that the tanker was travelling at slow speed on its correct side of the road, when a bus came from the opposite direction. The car suddenly came forward probably in an attempt to overtake the bus and it then hit into the tanker. In the circumstances despite the best efforts of the driver of the tanker, the accident could not be avoided.

The photographs of the car involved in the accident taken soon thereafter makes it apparent that the impact between the car and the tanker must indeed have been a very severe one as to have caused such damage both to the car as also the occupants thereof.

In order to establish their case, the claimants examined PW 1 Parma Nand and PW 2 Gurbaksh Singh as eye-witnesses to the occurrence. Both these witnesses deposed that they happened to be on the road when this accident took place. According to them the oil tanker was travelling at a very fast speed; whereas the car was coming at a moderate speed from the opposite direction. The car was on its correct side of the road when the tanker went and struck against it and the car was smashed thereby. A foreign lady travelling in this car was killed; while the three other women received serious injuries. The tanker stopped about half a furlong away. They did not see the driver of the tanker and the conductor thereof thereafter as neither of them came to the spot. A little while later a car came from the side of Mathura and the injured were removed in it.

The Tribunal doubted the presence of both these witnesses at the time of the accident and it was on this account that it came to the finding that the claimants had failed to prove that the accident had been caused by the negligence of the tanker.

It is pertinent to note that it was for the first time in court that PW 1 Parma Nand and PW 2 Gurbaksh Singh came forth to depose to this accident. Neither of them reported this accident to the police nor were their statements ever recorded by them. Gurbaksh Singh (PW 2) obviously came to be located as an eye-witness purely by chance as it was his testimony that about three months prior to his appearance in court two persons had come to his hotel and while taking meals they asked if anyone remembered this accident. He then told them that he had witnessed this occurrence.

As regards PW 1 Parma Nand, he had stated that about three months back a Sardarji from Delhi had come to him and enquired if he had witnessed this accident. He had then noted his address. He could not, however, give the name of this Sardarji.

The circumstance in which PW 1 Parma Nand and PW 2 Gurbaksh Singh were located as eye-witnesses to the occurrence, do indeed render it incumbent to scrutinize their testimony with care, but this circumstance by itself cannot justify their testimony being rejected on this ground alone. A reading of their testimony would show that they were both subjected to lengthy cross-examination. Counsel for the opposite party could, however, point to no contradictions or discrepancies to create any doubt therein. They have not been shown to be-in any manner connected with or interested in the deceased. It is also pertinent to note that they could not give the number of the car or the tanker involved in the accident. If indeed they were got up witnesses, they would be expected to have given this information too. All the circumstances leading the accident were correctly deposed to by them. In this behalf what deserves particular mention is their testimony that both the driver and the conductor went away from the spot after this accident. This fact stands admitted by the driver of the tanker RW 1 Suresh Chand.

For the fore-going reasons the presence of PW 1 Parma Nand and PW 2 Gurbaksh Singh at the spot at the time of the incident cannot but taken to stand established.

Turning now to the evidence of RW 1 Suresh Chand, the driver of the tanker, his testimony was that the tanker was proceeding at slow speed. The accident took place where there was a curve in the road. There was a bus coming from the opposite direction and it was just when the tanker and the bus were crossing each other that the car came on to the wrong side and struck against the tanker. What deserves note here is that no plea was raised in the written statement that at the place where the accident had taken place, there was a curve. It is also highly improbable that a vehicle trying to overtake another would come right behind the vehicle to be overtaken and then suddenly emerge and try to do so. The most telling circumstance against the driver here is the fact that after the accident, knowing of the damage that had been caused to the car, he did not make any effort to try to attend to the injured, but preferred to run away. He no doubt stated that he went to the police station and he was kept detained there for three days, but there is no evidence on record from the side of the police authorities to corroborate this.

Seen in the totality of the circumstances of this case, therefore, it must be held that the evidence clearly establishes that this accident took place entirely due to the rash and negligent driving of Suresh Chand, the driver of the tanker. The finding of the Tribunal on this issue is consequently hereby set aside.

The next question which arises for determination is regard to the amount payable as compensation to the claimants. While dealing with this aspect of the matter, it may be noted at the very outset that Mr. I.K. Mehta, counsel for the claimants conceded that no compensation was payable to the sisters of the deceased and the Tribunal had consequently erred in awarding compensation to them. It was also conceded that no amount was payable to the claimants, for any pain and agony suffered by them on account of the death of the deceased. It was, however, the case of the claimants that Mrs. Sushila Sondhi the mother of the deceased was entitled to compensation as claimed by her.

In dealing with this matter, it deserves note that Miss Savita Sondhi, deceased, was employed as a stenographer with the Working Director of Oberoi Hotels. According to the testimony of PW 4 Mr. Lamba, Personnel Manager, her emoluments at the time of her death were a little more than Rs. 500/- p.m. and in addition she was being paid Rs. 350/- as house rent and conveyance allowance and Rs. 250/- per month as meals allowance. Her total emoluments thus were over Rs. 1,100/- per month. She had before her prospects for further advancement in her career as Mr. Lamba deposed that there was also a senior grade in which the basic pay went up to Rs. 2,700/- with Rs. 500/- as house rent and conveyance allowance and an allowance for meals.

Miss Savita Sondhi was unmarried. Her mother Mrs. Sushila Sondhi was a widow and it was her testimony that it was Miss Savita Sondhi who had been maintaining her and her young daughters. Mrs. Sushila Sondhi was about 46 years of age at the time of the death of her daughter Savita Sondhi. Keeping in view the principles regarding computation of compensation as laid down by the Full Bench in Lachman Singh v. Gurmit Kaur 1979 ACJ 170 (P and H), the appropriate multiplier to be adopted here would clearly be 16. As regards the financial loss suffered by Mrs. Sushila Sondhi, it must be borne in mind that in the normal course the deceased would have been expected to get married in the next couple of years and this in turn would have increased the liabilities for her consequent upon her having a separate family. In this situation the amount that she would have been in a position to spare for the maintenance of her mother would have got correspondingly curtailed. In the circumstances that thus emerge in this case, it would be reasonable to take the financial loss to the mother to be at the rate of Rs. 250/- per month. On this basis with a multiplier of 16, the compensation that the claimant must be held entitled to works out to Rs. 48,000/- . Both the driver and owner of the tanker involved in the accident are undoubtedly liable for payment of this amount.

The question now arises with regard to the liability for payment of the amount awarded by the Respondent-insurance company. Mr. V.P. Gandhi appearing for the insurance company in the first instance sought to contend that RW 1 Suresh Chand did not hold a valid driving licence and consequently in terms of the policy of insurance, the insurance company could not be held liable in this case. Here it deserves note that the stand of Mr. I.K. Mehta counsel for claimants too was that the driver of the offending vehicle did not possess a valid driving licence. This contention is to be repelled on the short ground that no such plea was raised in the written statement nor indeed before the Tribunal. It was for the first time in appeal that this point was urged. On this matter, it would also be pertinent to advert to the testimony of RW 1 Suresh Chand, where he deposed that he had obtained a driving licence in 1962. No suggestion was made to RW 2 Gopi Nath, his employer, that Suresh Chand did not possess a valid driving licence. It must be noted that at no stage was the driver ever called upon to produce his driving licence if his possessing it was doubted. This is thus no ground to absolve the insurance company from liability.

The main stress of Mr. V.P. Gandhi was upon the plea that the policy of insurance had been obtained by Gopi Chand, the owner of the tanker by misrepresentation and non-disclosure of a material fact. The reference here was to the description of the vehicle as a truck in the proposal form exhibit R-l instead of a tanker.

Section 96(2)(c) of the Motor Vehicles Act, 1939 provides that a policy of insurance shall be void if it was obtained by non-disclosure of a material fact or by misrepresentation of fact which was false in some material particular. In Sub-section 5 thereof the expression "material fact and material particular" have been defined to mean "a fact or particular of such a nature as to influence the judgment of a prudent insurer in determining whether he will take the risk and if so, at what premium and on what conditions".

The case of the insurance company, on this aspect of the matter, rests upon testimony of RW 1 Mr. Sethi, Assistant Administrative Officer. He deposed that the insurance company was not liable as the vehicle was not a truck, but was a tanker. He further stated that if the insurance company had known that the vehicle was a tanker, it would have refused to insure it. It was upon these premises that the insurance company sought to escape liability in the present case. There is no gain-saying that the vehicle was wrongly described as a truck in the proposal form which led to the policy of insurance being issued in respect thereof. The matter to the considered, however, is the effect thereof. This is a matter which has to be determined keeping in view what a prudent insurer would have done, namely if he had known the true facts whether he would have taken the risk covered by the policy and if so, on what terms and conditions. Here it would be pertinent to go back to the testimony of RW 1 Mr. Sethi. It was his testimony that the rate of premium whether for a truck or a tanker was the same. He no doubt stated that if the insurance company had known that it was a tanker, it would not have insured it, but he pointed to no rule, instructions or office order to this effect. Further, it is also relevant that RW 2 Gopi Nath, deposed that the agent, who had given him the policy of insurance had known of the fact that the vehicle was a tanker and not a truck. It was within the knowledge of the insurance company who the agent was, but yet he was not produced. It is these circumstances which lead to the conclusion that the plea of misrepresentation and non-disclosure of material facts as raised in this case cannot avail the Respondent-insurance company to escape liability for the amount payable as compensation.

In the result, the claimant Mrs. Sushila Sondhi is hereby awarded a sum of Rs. 48,000/- as compensation which she shall be entitled to along with interest at the rate of 12 per cent per annum from the date of the application to the date of the payment of the amount awarded. The liability for the amount awarded as also interest thereon shall be joint and several of the driver, owner and the Respondent-insurance company. The claimants shall be entitled to the cost of their appeal. Counsel''s fee Rs. 300/- , while the appeals filed by the owner of the tanker and the Respondent-insurance company are hereby dismissed with no order as to costs.