File Copyright Online - File mutual Divorce in Delhi - Online Legal Advice - Lawyers in India

Motor Vehicles Act: Can Court Award Compensation Higher Than The Amount Claimed?

Whenever there is loss of life or injury covered under the Motor Vehicles Act, 1988 and the Court makes an observation that it wishes to grant higher compensation to the claimant than the amount claimed, it is vehemently opposed by the respondent/opposite party on the ground that the Court cannot legally award more than the amount claimed.

At the very outset it would be apposite to refer to the Apex Court judgment in Govind Yadav vs. The New India Insurance Co. Ltd (2011) 10 SCC 683 which underlined the circumstances surrounding the making of claims made under Motor Vehicles Act and the need to award "Just" Compensation urgently by the Courts with least delay. The observation of the Court is as under:

A very large number of people involved in motor accidents are pedestrians, children, women and illiterate persons. Majority of them cannot, due to sheer ignorance, poverty and other disabilities, engage competent lawyers for proving negligence of the wrongdoer in adequate measure. The insurance companies with whom the vehicles involved in the accident are insured usually have battery of lawyers on their panel.

They contest the claim petitions by raising all possible technical objections for ensuring that their clients are either completely absolved or their liabilities minimized. This results in prolonging the proceedings before the Tribunal. Sometimes the delay and litigation expenses' make the award passed by the Tribunal and even by the High Court (in appeal) meaningless.

It is, therefore, imperative that the officers, who preside over the Motor Accident Claims Tribunal adopt a proactive approach and ensure that the claims filed under Sections 166 of the Act are disposed of with required urgency and compensation is awarded to the victims of the accident and/or their legal representatives in adequate measure.

It will be trite to refer to Section 166 of the Motor Vehicles Act, which reads thus:

Section 166 in The Motor Vehicles Act, 1988

166. Application for compensation:
  1. An application for compensation arising out of an accident of the nature specified in sub-section (1) of section 165 may be made:
    1. by the person who has sustained the injury; or
    2. by the owner of the property; or
    3. where death has resulted from the accident, by all or any of the legal representatives of the deceased; or
  2. by any agent duly authorised by the person injured or all or any of the legal representatives of the deceased, as the case may be: Provided that where all the legal representatives of the deceased have not joined in any such application for compensation, the application shall be made on behalf of or for the benefit of all the legal representatives of the deceased and the legal representatives who have not so joined, shall be impleaded as respondents to the application.

1[(2) Every application under sub-section (1) shall be made, at the option of the claimant, either to the Claims Tribunal having jurisdiction over the area in which the accident occurred, or to the Claims Tribunal within the local limits of whose jurisdiction the claimant resides or carries on business or within the local limits of whose jurisdiction the defendant resides, and shall be in such form and contain such particulars as may be prescribed: Provided that where no claim for compensation under section 140 is made in such application, the application shall contain a separate statement to that effect immediately before the signature of the applicant.]

2[***] 3[(4) The Claims Tribunal shall treat any report of accidents forwarded to it under sub-section (6) of section 158 as an application for compensation under this Act.]"

It is also relevant to refer to Section 168 of the Motor Vehicles Act, which mandates making of an award determining ' JUST' compensation to the claimant. The said section reads thus:

168. Award of the Claims Tribunal:

  1. On receipt of an application for compensation made under section 166, the Claims Tribunal shall, after giving notice of the application to the insurer and after giving the parties (including the insurer) an opportunity of being heard, hold an inquiry into the claim or, as the case may be, each of the claims and, subject to the provisions of section 162 may make an award determining the amount of compensation which appears to it to be just and specifying the person or persons to whom compensation shall be paid and in making the award the Claims Tribunal shall specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them, as the case may be: Provided that where such application makes a claim for compensation under section 140 in respect of the death or permanent disablement of any person, such claim and any other claim (whether made in such application or otherwise) for compensation in respect of such death or permanent disablement shall be disposed of in accordance with the provisions of Chapter X.
     
  2. The Claims Tribunal shall arrange to deliver copies of the award to the parties concerned expeditiously and in any case within a period of fifteen days from the date of the award.
     
  3. When an award is made under this section, the person who is required to pay any amount in terms of such award shall, within thirty days of the date of announcing the award by the Claims Tribunal, deposit the entire amount awarded in such manner as the Claims Tribunal may direct.
     

It is common knowledge that after an accident involving injury or death, the family/dependent are under utter distress. Sometimes the legal heirs of the deceased are minors or uneducated. It may happen that the injured or the heirs of the deceased seek advice from family members or friends or from local advocate who does not specialise in claims and due to ignorance make a lower claim before the Court/Tribunal. However, when the Court applying the precedents/ established formulae wishes to grant higher compensation, the opposite parties raise a preliminary objection that the Court/Tribunal cannot grant pecuniary relief over and above the amount claimed by the victim/legal heirs as compensation.

This dispute was finally decided in favour of the claimant by the three member bench of the Apex Court in the landmark case of Nagappa Vs. Gurudayal Singh & Ors. (2003)2 SCC 274. It would be trite to reproduce the para 7 of the said judgment which read thus:

"Firstly, under the provisions of Motor Vehicles Act, 1988, (hereinafter referred to as "the MV Act") there is no restriction that compensation could be awarded only up to the amount claimed by the claimant. In an appropriate case where from the evidence brought on record if Tribunal/court considers that claimant is entitled to get more compensation than claimed, the Tribunal may pass such award. Only embargo is it should be 'Just' compensation, that is to say, it should be neither arbitrary, fanciful nor unjustifiable from the evidence.

This would be clear by reference to the relevant provisions of the M.V. Act. Section 166 provides that an application for compensation arising out of an accident involving the death of, or bodily injury to, persons arising out of the use of motor vehicles, or damages to any property of a third party so arising, or both, could be made:
  1. by the person who has sustained the injury; or
  2. by the owner of the property; or
  3. where death has resulted from the accident, by all or any of the legal representatives of the deceased; or
  4. by any agent duly authorised by the person injured or all or any of the legal representatives of the deceased, as the case may be.

Under the proviso to sub-section (1), all the legal representatives of the deceased who have not joined as the claimants are to be impleaded as respondents to the application for compensation. Other important part of the said Section is sub-section (4) which provides that "the Claims Tribunal shall treat any report of accidents forwarded to it under sub- section (6) of Section 158 as an application for compensation under this Act." Hence, Claims Tribunal in appropriate case can treat the report forwarded to it as an application for compensation even though no such claim is made or no specified amount is claimed."

In para 21 of the said judgment, the Court categorically held that the Court can award compensation exceeding the claimed amount. The Court held thus:

"For the reasons discussed above, in our view, under the M.V. Act, there is no restriction that Tribunal/Court cannot award compensation amount exceeding the claimed amount. The function of the Tribunal/Court is to award 'Just' compensation which is reasonable on the basis of evidence produced on record. Further, in such cases there is no question of claim becoming time barred or it cannot be contended that by enhancing the claim there would be change of cause of action.

It is also to be stated that as provided under sub-section (4) to Section 166, even report submitted to the Claims Tribunal under sub-section (6) of Section 158 can be treated as an application for compensation under the M.V. Act. If required, in appropriate cases, Court may permit amendment to the Claim Petition."

The Apex Court in Andhra Pradesh State Road Transport Corporation vs. M. Ramadevi (2008) 3 SCC 379 reiterated the dictum of Nagappa (supra).

The Apex Court in Sanobanu Nazirbhai Mirza & Ors vs Ahmedabad Municipal Transport Service 2013 (16) SCC 719 followed the dictum of Nagappa (supra) and held thus:
"In view of the aforesaid decision of this Court, we are of the view that the legal representatives of the deceased are entitled to the compensation as mentioned under the various heads in the table as provided above in this judgment even though certain claims were not preferred by them as we are of the view that they are legally and legitimately entitled for the said claims.

Accordingly we award the compensation, more than what was claimed by them as it is the statutory duty of the Tribunal and the appellate court to award just and reasonable compensation to the legal representatives of the deceased to mitigate their hardship and agony as held by this Court in a catena of cases. Therefore, this Court has awarded just and reasonable compensation in favour of the appellants as they filed application claiming compensation under Section 166 of the M.V. Act."

In Ningamma & Anr. vs United India Insurance Co. Ltd (2009) 13 SCC 710 the Apex Court reiterated the dictate of Nagappa (supra) and observed thus:
"Section 166 of the MVA speaks about "Just Compensation". The court's duty being to award "Just Compensation", it will try to arrive at the said finding irrespective of the fact as to whether any plea in that behalf was raised by the claimant or not. It was further observed in the aforesaid case that although the multiplier specified in the Second Schedule appended to the MVA are stricto sensu not applicable in a case under Section 166 of the MVA, it is not of much dispute that wherever the court has to apply the appropriate multiplier having regard to several factors in mind."

In Raj Rani & Ors vs. Oriental Insurance Co. Ltd. & Ors 2009 (13) SCC 654, the Apex Court observed thus:
13. It is not necessary in a proceeding under the Motor Vehicles Act to go by any rules of pleadings or evidence. Section 166 of the Act speaks about grant of just compensation. The court's duty being to award just compensation, it will try to arrive at the said finding irrespective of the fact as to whether any plea in that behalf was raised by the claimant or not.

In Oriental Insurance Co. Ltd vs. Mohd. Nasir & Anr 2009 (8) SCR 829, the Apex Court held thus:

27. The function of Commissioner is to determine the amount of compensation as laid down under the Act. Even if no amount is claimed, the Commissioner must determine the amount which is found payable to the workman. Even in the cases arising out of the 1988 Act, it is the duty of the Tribunal to arrive at a just compensation having regard to the provisions contained in Section 168 thereof.

It will be apropos to refer to Apex Court judgment in Syed Basheer Ahmed & Ors. v. Mohd. Jameel & Anr.(2009) 2 SCC 225, wherein it stressed the need to award 'Just' compensation and held thus:

9. Section 168 of the Act enjoins the Tribunal to make an award determining "the amount of compensation which appears to be just." However, the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression "which appears to the just" vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of compensation.

It is appropriate to refer to the case of Sri Laxman @ Laxman Mourya vs Divisional Manager, Oriental Insurance Co. Ltd. (2011) 10 SCC756 wherein the Apex Court granted higher compensation than the claimed amount as the Court held there is absence of bar in the Act for doing so and held thus:

21. It is true that in the petition filed by him under Section 166 of the Act, the appellant had claimed compensation of Rs.5,00,000/- only, but as held in Nagappa vs. Gurudayal Singh (2003) 2 SCC 274, in the absence of any bar in the Act, the Tribunal and for that reason any competent Court is entitled to award higher compensation to the victim of an accident.

22. In the result, the appeal is allowed. The impugned judgment is set aside and it is declared that the appellant shall be entitled to total compensation of Rs.8,37,640/- with interest at the rate of 8% from the date of filing the petition till the date of realisation."

Reference to Apex Court in Ibrahim vs Raju & Ors 10 SCC 634 is relevant wherein the Court enhanced the compensation more than the amount claimed and held thus:

21. We are conscious of the fact that in the petition filed by him, the appellant had claimed compensation of Rs.3 lacs only with interest and cost. It will be reasonable to presume that due to financial incapacity the appellant and his family could not avail the services of a competent lawyer and make a claim for adequate compensation.

However, as the Tribunal and the High Court and for that reason this Court are duty bound to award just compensation, we deem it proper to enhance the compensation from Rs.1,89,440/- to Rs.6 lacs. This approach is in tune with the judgment in Nagappa v. Gurudayal Singh (2003) 2 SCC 274."

Similarly in Sanjay Batham vs Munnalal Parihar & Ors (2011) 10 SCC 665, the Apex Court awarded higher compensation that claimed and held thus:

"17. It is true that in the petition filed by him under Section 166 of the Act, the appellant had claimed compensation of Rs. 4,20,000/- only, but as held in Nagappa vs. Gurudayal Singh (2003) 2 SCC 274, in the absence of any bar in the Act, the Tribunal and for that reason any competent Court is entitled to award higher compensation to the victim of an accident.

18. In the result, the appeal is allowed. The impugned judgment is modified and it is declared that the appellant shall be entitled to total compensation of Rs.5,62,000/-. He shall also be entitled to interest @ 9% per annum from the date of filing the claim petition till realization."

It would be relevant to refer to the case of Ramla vs National Insurance Co. Ltd (2019) 2 SCC 192 wherein the Apex Court held as under:

"6.Though the claimants had claimed a total compensation of Rs. 25,00,000/- in their claim petition before the Tribunal, we feel that the compensation which the claimants are entitled to is higher than the same as mentioned supra. There is no restriction that the Court cannot award compensation exceeding the claimed amount, since the function of the Tribunal or Court under Section 168 of the Motor Vehicles Act, 1988 is to award "just compensation".

The Motor Vehicles Act is a beneficial and welfare legislation. A "just compensation " is one which is reasonable on the basis of evidence produced on record. It cannot be said to have become time-barred. Further, there is no need for a new cause of action to claim an enhanced amount. The Courts are duty bound to award just compensation."

From the aforesaid, it is no longer res integra that the Courts are duty bound to award 'Just' compensation and therefore there is no legal bar against awarding higher compensation than claimed. The Courts have univocally held that under the Motor Vehicles Act, 1988, a victim or deceased's legal representative does not have to specify the amount claimed and in that case also the Court is also duty bound to award 'just' compensation.

Written By: Inder Chand Jain
Ph no: 8279945021, Email:[email protected]

Law Article in India

Ask A Lawyers

You May Like

Legal Question & Answers



Lawyers in India - Search By City

Copyright Filing
Online Copyright Registration


LawArticles

Increased Age For Girls Marriage

Titile

It is hoped that the Prohibition of Child Marriage (Amendment) Bill, 2021, which intends to inc...

How To File For Mutual Divorce In Delhi

Titile

How To File For Mutual Divorce In Delhi Mutual Consent Divorce is the Simplest Way to Obtain a D...

Section 482 CrPc - Quashing Of FIR: Guid...

Titile

The Inherent power under Section 482 in The Code Of Criminal Procedure, 1973 (37th Chapter of t...

Facade of Social Media

Titile

One may very easily get absorbed in the lives of others as one scrolls through a Facebook news ...

Sexually Provocative Outfit Statement In...

Titile

Wednesday, Live Law reported that a Kerala court ruled that the Indian Penal Code Section 354, ...

UP Population Control Bill

Titile

Population control is a massive problem in our country therefore in view of this problem the Ut...

Lawyers Registration
Lawyers Membership - Get Clients Online


File caveat In Supreme Court Instantly