ORIENTAL INSURANCE COMPANY LIMITED Vs. SHEELA RATNAN

JUDGEMENT

(1.) The question referred for consideration of the Full Bench is whether amendment to Sec. 140 of the Motor Vehicles Act, 1988 by the Motor Vehicles (Amendment) Act, 1994 enhancing the quantum of compensation is applicable to claims for compensation in respect of death or permanent disablement resulting from accidents which occurred prior to 14-11-1994, the date on which the Amending Act came into force. In New India Assurance Company Ltd. v. Thankam, (1995) 1 Ker LT 323, a Bench of this Court, while considering a claim arising out of an accident which occurred prior to 1-7-1989, namely, the date on which Motor Vehicles Act, 1988 came into force, took the view that it is the provision contained under S. 140 of Motor Vehicles Act, 1988 which should be applicable to the case and not the provisions contained under S. 92-A of the Motor Vehicles Act, 1939. The correctness of this decision is also under challenge.

(2.) The concept of no-fault liability was introduced for the first time in the Statute by way of amendment to the Motor Vehicles Act, 1939 under Amending Act 47 of 1982, which came into force on 1-10-1982. Section 92-A provided that where death or permanent disablement of any person has resulted from an accident arising out of a use of motor Vehicle, the owner of the vehicle shall be liable to pay compensation in respect of such death or disablement to the extent of Rs. 15,000/and Rs. 7500/- respectively. When the Motor Vehicles Act, 1988 came into force on 1st July 1989, provision regarding "no-fault liability" was incorporated in Sec 140. The amount of compensation was enhanced as Rs. 25,000/- and Rs. 12,000/- for death and permanent disablement respectively. The above provision underwent amendment by Act 54 of 1994, which came into force on 14-11-1994, further enhancing the amount of compensation as Rs. 50,000/- and Rupees 25,000/- respectively. In all these cases which have come up by way of reference, the accident had happened before 14-11-1994 and the proceedings were pending when the amendment came into force. The Tribunals applied the amended provisions Contained under S. 140 and passed interim awards on that basis, relying on the principles laid down in the Bench decision of this Court in (1995) 1 Ker LT 323 supra.

(3.) The question whether amount of Rs. 25,000/- fixed under the unamended Sec. 140 of the Motor Vehicles Act, 1988 in case of death, can be applied where death has occurred in a motor accident which took place before the 1988 Act came into force, was considered by a Bench of this Court in United India Insurance Company Ltd. v. Padmavathy, (1990) 1 Ker LT 750. The Division Bench took the view that even in respect of an accident happened before the coming into force of 1988 Act, the enhanced amount of compensation, as provided under Sec. 140 of 1988 Act would apply. This view was sought to be reconsidered later at the instance of the New India Assurance Company Limited, relying on a Bench decision of the Bombay High Court in Prakash Chandumal Khatri v. Suresh Pahilajrai Makhija, 1992 Acc CJ 369: (AIR 1991 Bom 365). The arguments put forward by the Insurance Company were rejected in (1995) 1 Ker LT 323 supra, affirming the view taken in (1990) 1 Ker LT 750 supra.