NEW INDIA ASSURANCE COMPANY LIMITED Vs. KRISHNA DEVI

JUDGEMENT

(1.) In this appeal two main questions have been raised, namely, (1) whether the liability of the insurance company is limited to the extent of Rs. 50,000.00 under the Motor Vehicles Act (in short the Act)? (2) whether the cross objections filed by the claimants seeking enhancement of compensation not tenable because appeal has been filed by the Insurance Company?

(2.) In order to appreciate these questions we may have quick glance to the relevant facts of this case. Deceased Shri Siri Pal aged about 37 years was standing in front of a tea shop behind Lawrence Road factory area on 10th August.1982 at about 7.45 AM, when a truck bearing No.DEL-6075 driven rashly and negligently came and struck him and his cycle. The deceased was crushed under the front wheels of the truck. At the time of this accident he was employed as a Peon in P & T Department. He was drawing a salary of Rs. 650.00 per month. Beside his salary the deceased was also doing part-time business wherefrom he was earning Rs. 800.00 per month. Thus his total monthly income was Rs. 1,450. 00 per month. His legal heirs consisting of his wife and three minor children filed a petition under the Act claiming compensation to the tune of Rs.Three lakhs. His parents were impleaded as respondents 4 and 5. Written statement was filed by this appellant in which the privity of contract was denied. A plea of limited liability was also taken in the written statement but neither the insurance policy was produced nor the insurance company led any evidence. By the impugned award the Motor Accident Claims Tribunal (in short the Tribunal) awarded a sum of Rs. 76,800.00 in favour of the claimants beside awarding interest at the rate of 12% from the date of petition till realisation. The awarded amount was to be shared by the claimants and respondents 4 and 5. The Tribunal fixed the liability of the insurance company (present appellant) and of owner and driver joint and several.

(3.) In order to appreciate the controversy raised with regard to limited liability the relevant provision of Section 95(2)(a) of the Act may be perused which are reproduced as under:- Section 95(2)(a): Subject to the proviso to sub-section (1), a policy of insurance shall cover any liability incurred in respect of any one accident up to the following limits, namely -