Chattisgarh High Court
National Insurance Company Ltd vs Smt. Anjali Sahu on 8 May, 2025
1
Digitally signed
by BHOLA
NATH KHATAI
Date:
2025.05.12
17:42:28 +0530
2025:CGHC:21286
NAFR
HIGH COURT OF CHHATTISGARH AT BILASPUR
MAC No. 2244 of 2019
National Insurance Company Ltd. Branch Office, Branch
Manager Kamthi Line District Rajnandgaon Through Its T.
P. Hub Incharge, Office- Vyapar Vihar Road, Above Canara
Bank, Bilaspur 495001
--- Appellant
versus
1. Hemdas Sahu S/o Late Lekharam Sahu, Aged About 45
Years R/o Village Kesal, Police Station Gainda-Tola, Tahsil
Chhuriya, District Rajnandgaon Chhattisgarh ... Claimant
2. Smt. Daya Bai Sahu W/o Hemdas Sahu, Aged About 43
Years R/o Village Kesal, Police Station Gaindatola, Tahsil
Chhuriya, District Rajnandgaon Chhattisgarh .... Claimant
3. Amjad Ali S/o Aamir Ali, Aged About 40 Years Occupation
Driver, R/o Village Chhuriya, Police Station- Chhuriya,
District Rajnandgaon, Chhattisgarh .............. Driver
4. Smt. Shweta Yadav C/o- Sukriti Yadav, Occupation-
Vehicle Owner, Through Naresh Yadav, Ashirwad Travels,
Chhuriya, District Rajnandgaon, Chhattisgarh ..... Owner
--- Respondent(s)
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MAC No. 2240 of 2019
National Insurance Company Ltd. Branch Office, Branch
Manager Kamthi Line District Rajnandgaon Through Its T.
P. Hub Incharge Office- Vyapar Vihar Road, Above Canara
Bank, Bilaspur 495001
—Appellant
Versus
1. Smt. Anjali Sahu Wd/o Late Narottam Sahu, Aged About
20 Years R/o Village Kesal, Police Station Gaindatola
Tahsil Chhuriya, District Rajnandgaon, Chhattisgarh
2. Leela Das Sahu S/o Tilak Sahu, Aged About 19 Years R/o
Village Kesal, Police Station Gaindatola, Tahsil Chhuriya,
District Rajnandgaon, Chhattisgarh …………… Claimant
3. Amjad Ali S/o Aamir Ali, Aged About 40 Years Occupation
Driver, R/o Village Chhuriya, Police Station Chhuriya,
District Rajnandgaon Chhattisgarh ……………. Driver
4. Smt. Shweta Yadav C/o Sukriti Yadav, Occupation Vehicle
Owner, Through Naresh Yadav, Ashirwad Travels,
Chhuriya, District Rajnandgaon Chhattisgarh …… Owner
— Respondent(s)
For Appellants : Mr. Akash Shrivastava, Advocate, on
behalf of Mr. R. N. Pusty, Advocate
For Respondents 1 & 2 : None
For Respondents 3 & 4 : Mr. Samir Singh, Advocate
Hon’ble Shri Justice Sanjay Kumar Jaiswal
Order on Board
08.05.2025
1. Since both the appeals have preferred by the Insurance
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Company under Section 173 of the Motor Vehicles Act,
1988, challenging the the award dated 20.08.2019 passed
by the Additional Motor Accident Claims Tribunal,
Rajnandgaon, Chhattisgarh in Claim Case No.27/2018 &
35/2018, they are being disposed of by this common order.
2. The facts, necessary for disposal of the appeals, in brief, are
that on the date of accident i.e. 02.11.2017, Rupesh Kumar
was coming from village Tipangarh to his home in village
Kesal on a motorcycle with his friend Narottam Sahu. When
they reached near the field of Kumar Sai on Fafamar –
Metepar road, respondent No.3 Amjad Ali driving the
offending bus bearing registration No. CG 08 M 9990 rashly
and negligently, hit their motorcycle, as a result of which
Rupesh Kumar and Narottam Sahu suffered grievous
injuries and died during treatment in the hospital. The legal
representatives of both the deceased preferred two separate
applications claiming compensation under various heads.
3. In Claim Case No.27/2018 preferred by the parents of
deceased Rupesh Kumar Sahu, the Tribunal has awarded a
total compensation of Rs.9,85,000 and in Claim Case No.
35/2018 preferred by the legal representatives i.e. wife and
younger brother of deceased Narottam Sahu, the Tribunal
has awarded compensation of Rs.8,86,000. While passing
the impugned awards, the Tribunal has saddled the liability
of payment of compensation upon the Insurance Company
against which both the appeals have been filed by the
Insurance Company.
4. Learned counsel for the appellant/insurance company
argues that the vehicle in question was a passenger carrying
commercial vehicle which required fitness certificate to
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operate but it did not have fitness certificate at the time of
accident. This fact is also proved from the statements of the
driver Amjad Ali, owner Shweta Yadav and Insurance
Company witness C. Toppo. Since there has been a breach
of policy condition on the ground of not having fitness
certificate, the insurance company cannot be held liable for
payment of compensation. Hence, prayed for allowing the
appeals by exonerating the insurance company from its
liability.
5. None appeared on behalf of Respondents 1 & 2/claimants.
6. Learned counsel for the respondents 3 & 4 i.e. vehicle driver
& owner argues that the insurance company cannot escape
its liability even in the absence of fitness certificate. Lack of
fitness certificate is not a fundamental breech but merely a
technical breach and the insurance company cannot be
relieved of its liability on the basis of the said breach.
7. Heard learned counsel for the parties and perused the
record.
8. It is an undisputed fact that the vehicle in question was a
passenger bus which was being driven by respondent No.3
Amjad Ali at the time of accident. The registered owner of
the said bus was respondent No.4 Shweta Yadav and it was
insured by the appellant-insurance company.
9. Assistant Manager, C. Toppo has been examined on behalf
of Insurance Company, who has stated that on the date of
incident, the vehicle in question was being plied without a
valid fitness certificate. This fact has also been admitted by
the driver of the offending vehicle, Amjad Ali. The owner
Shweta Yadav herself has admitted the fact before the JMFC
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that at the time of accident, the bus did not have a valid and
effective fitness certificate. As such, the statements of the
driver and the owner clearly establish that on the date of
accident, the vehicle in question did not have a valid and
effective fitness certificate.
10. So far as the vehicle in question was not having any valid
fitness certificate on the date of accident is concerned, this
issue also stands settled by the Division Bench of this Court
as well as by Kerala High Court in Pareed Pillai Vs.
Oriental Insurance Company Ltd., AIR 2019 Kerala 6.
11. The fitness of a vehicle, which is a transport vehicle, is
having great importance. Section 56 of the MV Act provides
that a transport vehicle {subject to the provisions of Section
59 (power to fix the age limit of motor vehicle) and Section
60 (registration of vehicle belonging to the Central
Government)} shall not be deemed to be validly registered for
the purpose of Section 39, unless it carries a certificate of
fitness as prescribed. For the purposes of valid permit of a
transport vehicle, as provided under Section 34 of the MV
Act, a certificate of fitness is required necessarily and in
absence of the same, the situation automatically lead to the
stage that a vehicle did not have valid permit. Using a
vehicle without any fitness certificate would be violation of
policy condition.
12. Requirement of certificate of fitness is envisaged under
Section 56 of the MV Act. Section 56(1) is reproduced below
for ready reference.
“Subject to the provisions of sections 59
and 60, a transport vehicle shall not be
deemed to be validly registered for the
purposes of section 39, unless it carries a
6certificate of fitness in such form
containing such particulars and
information as may be prescribed by the
Central Government, issued by the
prescribed authority, or by an authorised
testing station mentioned in sub-section
(2), to the effect that the vehicle complies
for the time being with all the requirements
of this Act and the rules made thereunder:
Provided that where the prescribed
authority or the authorised testing station
refuses is issue such certificate, it shall
supply the owner of the vehicle with its
reasons in writing for such refusal.”
13. Perusal of above provision would show that unless and until
there is valid certificate of fitness, transport vehicle shall not
be deemed to be validly registered. Requirement of
certificate of fitness is mandatory and fundamental for its
registration. Section 39 of the MV Act envisages for
registration of vehicle, which reads as under:
“39. No person shall drive any motor vehicle
and no owner of a motor vehicle shall cause
or permit the vehicle to be driven in any
public place or in any other place unless the
vehicle is registered in accordance with this
Chapter and the certificate of registration of
the vehicle has not been suspended or
cancelled and the vehicle carries a
registration mark displayed in the
prescribed manner:
Provided that nothing in this section shall
apply to a motor vehicle in possession of a
dealer subject to such conditions as may be
prescribed by the Central Government.”
14. It prescribes that no person shall drive any motor vehicle in
public or other places unless the vehicle is registered.
Conjoint reading of provisions of Section 39 and 56 of the
MV Act makes it clear that if the transport vehicle is plied
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on public road or any place without certificate of fitness will
be in breach of policy condition and such breach will be a
fundamental breach.
15. This issue has been considered by the five judges Bench of
Kerala High Court (five Judges Bench) in case of Pareed
Pillai Vs. Oriental Insurance Company Ltd., AIR 2019
Kerala 6 and held as under:
“17. The stipulations under the above
provisions clearly substantiate the importance
and necessity to have a valid Fitness
Certificate to the transport vehicle at all times.
The above prescription converges on the point
that Certificate of Registration, existence of
valid Permit and availability of Fitness
Certificate, all throughout, are closely
interlinked in the case of a transport vehicle
and one requirement cannot be segregated
from the other. The transport vehicle should be
completely fit and road worthy, to be plied on
the road, which otherwise may cause threat to
the lives and limbs of passengers and the
general public, apart from damage to property.
Only if the transport vehicle is having valid
Fitness Certificate, would the necessary Permit
be issued in terms of Section 66 of the Act and
by virtue of the mandate under Section 56 of
the Act, no transport vehicle without Fitness
Certificate will be deemed as a validly
registered vehicle for the purpose of Section 39
of the Act, which stipulates that nobody shall
drive or cause the motor vehicle to be driven
without valid registration in public place or
such other place, as the case may be. These
requirements are quite ‘fundamental’ in MACA
No. 2030 of 2015 and connected cases nature;
unlike a case where a transport vehicle
carrying more passengers than the permitted
capacity or a goods carriage carrying excess
quantity of goods than the permitted extent or
a case where a transport vehicle was plying
through a deviated route than the one shown
in the route permit which instances could
rather be branded as ‘technical violations’. In
other words, when a transport vehicle is not
8having a Fitness Certificate, it will be deemed
as having no Certificate of Registration and
when such vehicle is not having Permit or
Fitness Certificate, nobody can drive such
vehicle and no owner can permit the use of any
such vehicle compromising with the lives,
limbs, properties of the passengers/general
public. Obviously, since the safety of
passengers and general public was of serious
concern and consideration for the law makers,
appropriate and adequate measures were
taken by incorporating relevant provisions in
the Statute, also pointing out the
circumstances which would constitute offence;
providing adequate penalty. This being the
position, such lapse, if any, can only be
regarded as a fundamental breach and not a
technical breach and any interpretation to the
contrary, will only negate the intention of the
law makers.”
16. Division Bench of this High Court also has applied the same
analogy in case of Adesh Kumar & Another Vs. Smt.
Satarupa Bai Yadav & Others (MAC No.1289 of 2014 and
other connected matters, decided on 19.11.2020) and held
that absence of fitness certificate of the offending vehicle is a
fundamental breach of policy condition. It is not a technical
breach.
17. The principal held by the Kerala High Court in Pareed Pillai
(Supra) is effective which has been applied by this Court
also. Therefore, in light of that it is found that absence of
fitness certificate is a fundamental breach and the
appellant/insurance company is not liable for payment of
compensation on account of this fundamental breach.
18. However, the Hon’ble Supreme Court in the matter of Amrit
Paul Singh and another Vs TATA AIG General Insurance
Company Limited and others, reported in 2018(3) KHC
197 considered the issue with respect to violation of
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conditions of Insurance Policy on the ground that offending
vehicle was not having a valid permit and held that
Insurance Company first to satisfy the award and thereafter
to recover the same from the insured. In the case in hand
also there is a clear breach of policy condition as the
offending vehicle did not have a valid and effective ‘fitness
certificate’ on the date of accident.
19. Accordingly, in the light of the principle laid down by the
Supreme Court in the case of Amrit Paul Singh (Supra), the
appellant/insurance company is directed to first pay the
amount of compensation fixed by this Court and then
recover the same from the owner & the driver of the
offending vehicle by filing execution petition before the
concerned Claims Tribunal.
20. Thus, both the appeals of the Insurance Company are partly
allowed to the extend indicated herein-above.
Cross Appeals
21. Two cross appeals have been filed by the claimants for
enhancement of the compensation whereas the contention
of learned counsel for the Insurance Company is that
excessive compensation has been awarded in favour of the
claimants.
22. The cross-appeals were considered in the absence of learned
counsel for the claimants. The parties present were heard.
23. Now this Court shall examine as to whether the
compensation awarded by the Tribunal is just and proper
compensation in the given facts and circumstances of the
case.
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Cross-Appeal filed by the parents of deceased Rupesh
Kumar in MAC No.2244/2019
24. From the evidence produced by the claimants side it is clear
that deceased Rupesh Kumar was an unmarried young man
of 22 years at the time of accident. He was working as a
mason. Hence, the Tribunal has assessed the income of
deceased at Rs.6,000 per month as no documentary
evidence regarding his income has been brought on record.
The accident occurred on 02.11.2017 and the minimum
wages of even an unskilled labour at that time was Rs.7930.
Hence, the income of the deceased is assessed at Rs.7930
per month instead of Rs.6,000 as minimum wages. Taking
into account the age of the deceased, his marital status and
the number of claimants (two), the future prospects would
be 40%, the deduction towards personal expenses would be
half of the income and not 1/3rd as wrongly held by the
Tribunal and the multiplier would be18.
25. In the light of the judgments of the Hon’ble Supreme Court
in Sarla Verma (Smt.) and others vs. Delhi Transport
Corporation and another reported in (2009) 6 SCC 121,
National Insurance Company Ltd., Vs. Pranay Sethi and
Others, (2017) 16 SCC 680 and Magma General
Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram & Ors;
(2018) 18 SCC 130, the compensation is being recomputed
as below:-
Particulars Calculation
Monthly income of the deceased 7,930
Yearly income 95,160
Future prospects(40% of the 38,064
income)
Total 1,33,224
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Personal expenses (half of the 66,612
income)
Annual loss of dependency 66,612
Total loss of dependency (applying 66612 x 18 = 11,99,016
multiplier of 18)
Funeral Expenses 15,000
Loss of estate 15,000
Spousal & filial consortium and 40000 x 2 = 80,000
love & affection (Rs.40,000 to each
claimant)
Total compensation Rs.13,09,016
26. Thus, the total compensation is recomputed as
Rs.13,09,016/- from which after deduction of Rs.9,85,000/-
awarded by the Tribunal, the enhancement would be
Rs.3,24,016/-.
27. Accordingly, the parents/claimants of deceased Rupesh
Kumar Sahu are entitled for the enhanced amount of
Rs.3,24,016/- in addition to what is already awarded by
the Tribunal.
Cross-Appeal filed by the legal representatives of
deceased Narottam Sahu in MAC No.2240/2019
28. It is clear from the evidence produced by the claimants side
that deceased Narottam Sahu was aged about 26 years at
the time of accident. He was working as a mason. Hence,
the Tribunal has assessed the income of deceased at
Rs.6,000 per month as no documentary evidence regarding
his income has been brought on record. Taking into account
the minimum wages of an unskilled labour at that point of
time, the income of the deceased is assessed at Rs.7930 per
12
month instead of Rs.6,000, as minimum wages. There are
total two claimants who are the wife and younger brother of
the deceased. Therefore, considering the age of the deceased
and the number of claimants, the future prospects would be
40%, the deduction towards personal expenses would be
1/3rd of the income and the multiplier would be 17, as
rightly held by the Tribunal.
29. In the light of the judgments of the Hon’ble Supreme Court
in Sarla Verma (Smt.) and others vs. Delhi Transport
Corporation and another reported in (2009) 6 SCC 121,
National Insurance Company Ltd., Vs. Pranay Sethi and
Others, (2017) 16 SCC 680 and Magma General
Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram & Ors;
(2018) 18 SCC 130, the compensation is being recomputed
as below:-
Particulars Calculation
Monthly income of the deceased 7,930
Yearly income 95,160
Future prospects(40% of the income) 38,064
Total 1,33,224
Personal expenses (1/3rd of the 44,408
income)
Annual loss of dependency 88,816
Total loss of dependency (applying 88816 x 17 =15,09,872
multiplier of 17)
Funeral Expenses 15,000
Loss of estate 15,000
Spousal & filial consortium and love 40000 x 2 = 80,000
& affection (Rs.40,000 to each
claimant)
Total compensation Rs.16,19,872
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30. Thus, the total compensation is recomputed as
Rs.16,19,872/- from which after deduction of Rs.8,86,000/-
awarded by the Tribunal, the enhancement would be
Rs.7,33,872/-.
31. Accordingly, the legal representatives/claimants of deceased
Narottam Sahu are entitled for the enhanced amount of
Rs.7,33,872/- in addition to what is already awarded by
the Tribunal.
32. The enhanced amount in both the cross-appeals will carry
interest @ 6% per annum from the date of enhancement of
the award till its realization. The impugned awards stand
modified to the above extent and rest of the conditions shall
remain intact.
33. In the result, both the appeals, preferred by the Insurance
Company stand partly allowed as considering the breach of
policy condition, an order of “pay and recover” has been
passed. Both the cross appeals filed by the claimants stand
allowed to the extent indicated herein above.
34. The Registry is directed to communicate the claimants in
writing “the enhanced amount” in both the cross- appeals
as against the award made by the Tribunal. The said
communication be made in Hindi Deonagri language and
the help of paralegal workers may be availed with a co-
ordination of Secretary, Legal Aid of the concerned area
wherein the claimants reside.
Sd/-
(Sanjay Kumar Jaiswal)
Judge
Khatai
