CMA/1203/2022 of The Divisional Manager Vs A. Sowmya on 28 September 2026

Common Judgment

(Common Judgment of the Court was delivered by N.Mala J.)

The Insurance Company, aggrieved by the compensation awarded by the Claims Tribunal to the injured claimants as well as to the legal heirs of the deceased persons, by its common Award dated 30.08.2018, made in MCOP.Nos.5/2014, 49/2016, 50/2016, 240/2016 and 241/2016, has preferred CMA.Nos.2380/2018,1207/2022, 1203/2022, 1212/2022 and 1204/2022 respectively.

Not satisfied with the compensation awarded by the Claims Tribunal, the injured claimant in MCOP.No.5/2014, has filed CMA.No.2468/2016, for enhancement of compensation.

Since the appeals arise out of one and same accident which took place on 01.06.2013, the Civil Miscellaneous Appeals are taken up together for hearing and are disposed of by this common judgment.

The parties will be referred to as the claimants and the Insurance Company.

The summary of facts are as follows:- On 01.06.2013, at about 06.30 hours, the deceased persons Anthoniraj and Usharani, along with their children, Sowmiya and Santhosh Prabhu, were travelling in a Car bearing Regn.No.TN-23-AE-9388, driven by one Assen. While so, on Virudhunagar – Sathoor Main Road, when the car was nearing Ettunaickenpatti Village, the driver of the car, drove the vehicle in a rash and negligent manner and dashed it against the culvert, due to which it capsized and fell into an Odai. Due to the impact, the said Anthoniraj and Usharani died and their children Sowmiya and Santhosh Prabhu, and the driver of the car sustained grievous injuries.

The following claim petitions were filed before the learned Special Subordinate Judge, Motor Accidents Claims Tribunal, Tiruvannamalai:-

S.No. MCOP.No. Filed By Compensation claimed in Rs.

Assen – injured 5,00,000/-

Dr.A.Sowmya – Injured 15,00,000/-

A.Sowmiya, Santhosh Prabhu, Ponnusami, Santhanapandian – Daughter, Son and Parents of the deceased Usharani 30,00,000/-

A.Sowmiya, Santhosh Prabhu – Daughter and Son of the deceased Anthoniraj 50,00,000/-

Santhosh Prabhu - Injured 12,00,000/-

Before the Claims Tribunal, Vasanthi, the owner of the car, and one Assain Basha, the subsequent purchaser, remained exparte. The Claim petitions were contested by the Insurance Company, the insurer of the Car. The Insurance Company denied the manner of accident, negligence, liability and the quantum of compensation claimed by the claimants. The Insurance Company denied the legal heirship of the claimants in MCOP.Nos.50/2016 and 240/2016 and the nature of injuries sustained by the claimants in MCOP.Nos.5/2014, 40/2016 and

241/2016. The Insurance Company alleged that the car in question, was not insured with it. The Insurance Company also contended that the compensation claimed was excessive and speculative. The Insurance Company, therefore, prayed to dismiss the claim petitions.

Before the Claims Tribunal, in MCOP.No.5/2014, the claimant examined himself as PW1 and Dr.Ravindhar as PW2 and marked 14 documents. On the side of the respondents, one Mr.Sridhar, was examined as RW1 and 11 documents were marked. In MCOP.Nos.49, 50, 240 and 241/2016, the injured claimants Sowmiya and Santhosh Prabhu examined themselves as PW1 and PW2 apart from examining one other witness as PW3 and marked 18 documents. On the side of the respondent, one Sampath was examined as RW1 and 11 documents were marked. Ex.C1 and Ex.C2, Medical Reports of Sowmiya and Santhosh Prabhu, were marked as Court documents.

In MCOP.No.5/2014, the Claims Tribunal, on an assessment of the entire evidence on record, particularly, on the basis of the evidence of the Doctor, PW2 and on the basis of the documentary evidence,

Exs.P2, P7 and P10, found that the claimant suffered 40% permanent disability and awarded Rs.1,15,200/- towards permanent disability. The Claims Tribunal, awarded a total compensation of Rs.1,28,900/-.

In MCOP.Nos.49, 50, 240 and 241/2016, the Claims Tribunal, on an analysis of the evidence on record, both oral and documentary, found that the 1st respondent had sold the car involved in the accident to the 3rd respondent. The Claims Tribunal, finding that the evidence of PW1 and PW2, the injured claimants, with respect to the manner of the accident, was cogent, clear and corroborated by Ex.P1, the FIR in Crime No.209/2013, believed and accepted their evidence.

The claimant in MCOP.No.49/2016, was a college student at the time of accident and the Claims Tribunal, based on the Disability Certificate issued by the Medical Board under Ex.C1, fixed the disability at 20%. Since the claimant had not adduced any evidence on the functional disability, the Claims Tribunal held that she could be awarded compensation on percentage basis and awarded a sum of

Rs.60,000/- towards ‘’disability’’. The Claims Tribunal, awarded a total compensation of Rs.3,30,442/-. The claimant in MCOP.No.241/2016, was a minor and a student at the time of the accident. Here also, since the claimant had not adduced any evidence for his functional disability, the Claims Tribunal, by adopting percentage basis and on the basis of Ex.C2-Disability Certificate issued by the Medical Board, fixed the disability at 30% and awarded Rs.90,000/- towards the same. The Claims Tribunal, after awarding sums under other conventional heads, awarded a total compensation of Rs.5,60,000/- to the claimant.

The claimants in MCOP.No.240/2016, the daughter and son of the deceased Anthoniraj, filed the claim petition as his legal heirs. According to the claimants, the deceased was aged 49 years , was running a Grocery shop in the name and style as ‘’T.A.Raj Nadar Maligai’’, and was earning Rs.30,000/- per month, at the time of the accident. However, the Claims Tribunal, on the basis of the income tax returns furnished under Ex.P11, fixed the notional income of the deceased Anthoniraj at Rs.15,000/- per month and after following the settled principles, awarded a sum of Rs.17,55,000/- towards ‘’loss of income’’. The Claims Tribunal, awarded Rs.50,000/- and Rs.75,000/- as compensation towards loss of love and affection to the daughter and son of the deceased. After awarding sums under other conventional heads, the Claims Tribunal, awarded a total compensation of Rs.19,10,000/-.

In MCOP.No.50/2016, the claimants 1 and 2, the children and claimants 3 and 4, the parents of the deceased Usharani, as her legal heirs, filed the claim petition. According to the claimants, the deceased was aged 45 years, was running a Grocery shop in the name and style as ‘’T.A.Raj Nadar Maligai’’, and was earning Rs.2 lakhs per annum, at the time of the accident. However, the Claims Tribunal, on the basis of the income tax returns furnished under Ex.P9, fixed the notional income of the deceased Usharani, at Rs.12,000/- per month and after following the settled principles, awarded a sum of Rs.17,01,000/- towards ‘’loss of income’’. The Claims Tribunal, awarded Rs.50,000/- and Rs.75,000/- as compensation towards loss of love and affection to the daughter and son of the deceased. The

Claims Tribunal awarded Rs.15,000/- each for the parents of the deceased Usharani, towards loss of love and affection. After awarding sums under other conventional heads, the Claims Tribunal, awarded a total compensation of Rs.18,86,000/-. Aggrieved by the findings of the Claims Tribunal on quantum, the Insurance Company has filed CMA.Nos.2380/2018, 1203/2022, 1204/2022, 1207/2022 and 1212/2022.

The claimant in MCOP.No.5/2014, not satisfied with the compensation awarded by the Claims Tribunal, has preferred CMA.No.2468/2016.

The only issue raised by the learned counsel for the appellant is that the Insurance Company was not liable to compensate the claimants, since there was a cancellation of policy due to dishonour of cheque with proper intimation of the cancellation. The learned counsel submitted that since there was a cancellation of the policy, there could be no direction even for pay and recovery.

The learned counsel for the respondents on the other hand contended that the issue of liability was properly considered by the Claims

Tribunal and that, it had rightly relied on the Division Bench judgment of this Court in the case of New India Assurance Company Limited vs. Azhaghu Sumathi, reported in 2015(1) TN MAC 179 (DB) for directing the Insurance Company to pay the compensation and recover the same from the owner. The learned counsel therefore contended that there were no merits in the Civil Miscellaneous Appeal and same deserved to be dismissed.

We have heard both the learned counsels and perused the materials placed on record.

The only point agitated by the appellant/Insurance Company is that since the owner of the vehicle was intimated about the dishonour of cheque and also about the cancellation policy with similar intimation to the Regional Transport Office, the appellant was not liable to pay compensation to the claimants. It is an admitted fact that the 1st respondent was the original owner of the car and that, she had taken an insurance policy under Ex.R1, for the car, covering the period from 28.08.2012 to 27.08.2013. The accident occurred during the subsistence of the policy, on 01.06.2013 and therefore, normally the

Insurance Company would be liable to indemnify the owner. However, it is the appellant’s case that on 03.07.2012, under Ex.R3, the cheque issued by the 1st respondent, was returned by the Bank, due to insufficient funds. On receipt of the intimation from the Bank, under Ex.R3, the appellant, under Exs.R4 and R5, dated 02.11.2012, immediately intimated the 1st respondent and also, the Regional Transport Office, about the dishonour of cheque due to insufficient funds and cancellation of the policy. From the aforesaid documents, it is clear that the cancellation of the policy was intimated prior to the accident on 01.06.2013.

However, the question is whether the Insurance Company can be made liable to pay compensation to the claimants who are third parties and then recover the same from the owner of the offending vehicle.

A Division Bench of this Court in the case of New India Assurance Company Limited Vs. Azhagu Sumathi [2015 [1] TNMAC 179 [DB]], while considering similar issue of cancellation of the policy due to dishonour of cheque, held as follows:-

‘’14. As per Section 27 of General Clauses Act, 1897 which deals with topic 'Meaning of service by post' says that where any Central Act or regulation authorizes or requires a document to be served by post, then unless a different intention appears, the service shall be deemed to be effected by properly addressing', prepaying and posting it by registered post, a letter containing the document, and, unless the contrary is proved, to have been effected at the time at which the letter would be delivered in ordinary course of post. The Section, thus, raises the presumption of due service or proper service if the document sought to be served is sent by properly addressing, prepaying and posting by registered post to the addressee and such presumption is raised irrespective of whether any acknowledgment due is received from the addressee or not. Of course, the said presumption is rebuttable. But in the present case Exs.B4, B6 and B7 would show that the letter intimating about the dishonour of cheque followed by cancellation of policy has been sent to the address of the owner given in the policy by registered post, of course, without any acknowledgement due. The said letter having been sent properly addressing and posting it by registered post, it would raise a presumption that the service been effected on the addressee to whom the communication was sent. Therefore, the appellant having intimated the notice of cancellation by registered post to the owner and the RTO, the service of notice of cancellation can be treated as sufficient and the insurance company can take advantage that it has duly intimated to the owner of the offending vehicle and the authorities concerned regarding cancellation of policy due to the dishonour of cheque. Hence, the insurer cannot be held liable to indemnify the owner and it is absolved from liability. The reasoning given and the finding recorded by the Tribunal in this regard is erroneous. Both the questions are answered accordingly. However, the claim of third party cannot be defeated for the self created predicament of the insurer in issuing the policy without actually receiving the premium. Hence, the insurance company shall pay the compensation to the claimants which it may realise from the owner of the offending vehicle.’’

Since the Coordinate Bench of this Court has held that the Insurance Company is bound to pay compensation to the claimants and thereafter, realise the same from the owner of the vehicle, we, as a Coordinate Bench, are bound by the same. Following the aforesaid judgment of the Division Bench, we are of the view that the

appellant/Insurance Company should be directed to pay the compensation to the claimants and recover the same from the owner of the offending vehicle. Hence, the Civil Miscellaneous Appeals filed by the Insurance Company in CMA.Nos.1203, 1204, 1207 and 1212/2022 and 2380/2018 are dismissed.

CMA.No.2468/2016 is filed by the injured claimant seeking enhancement of compensation.

According to the learned counsel, the Claims Tribunal has not properly considered the nature of injuries sustained by the claimant and the period of treatment undergone by him, while awarding compensation. The learned counsel submitted that the compensation awarded was meagre and the same required to be enhanced.

It is seen that under Ex.P2, the Accident Register, the following injury is recorded, namely, ‘’injuries to the right leg along with fracture.’’. PW2, the doctor, in his evidence, deposed that the fracture injury sustained by the claimant was mal-united, resulting in restricted movement. The Claims Tribunal, based on the evidence of PW2 and Ex.P13, the Disability Certificate, assessed the permanent disability at

40%. Considering the nature of injuries, namely, mal-united fracture and the period of treatment undergone by the claimant, the Claims Tribunal thought it appropriate to adopt the unit method for computing the compensation. The Claims Tribunal awarded Rs.1,20,000/- towards permanent disability of 40%, by taking Rs.3,000/- per unit. The Claims Tribunal awarded Rs.5,000/- towards ‘pain and sufferings’ and Rs.8,700/- towards medical expenses. Considering that the claimant had sustained only fracture injury and the disability certificate, certified the disability at 40% only, we find no infirmity in the Claims Tribunal adopting the unit method for computing compensation towards permanent disability. Considering the nature of injuries, we are of the view that the amount awarded of the Claims Tribunal, is fair, just and reasonable and the same calls for no interference. Hence, CMA.No.2468/2016 is dismissed.

In view of the above discussions, we find no merit in all the Civil Miscellaneous Appeals and hence, the same are dismissed and the judgments and decrees of the Claims Tribunal dated 01.02.2016 and 30.08.2018, made in MCOP.Nos.5/2014, 49/2016, 50/2016, 240/2016

and 241/2016, respectively, are confirmed. No costs. Consequently, the connected miscellaneous petitions are closed. (P.T.A.,J.) (N.M.,J.) 28-09-2026 Index: Yes/No Speaking/Non-speaking order Neutral Citation: Yes/No AP To

1. The Special Subordinate Judge Motor Accidents Claims Tribunal Tiruvannamalai.

2. The Divisional Manager The New India Assurance Co.Ltd, No.106, First Floor, Big St, Tiruvannamalai.

3. New India Assurance Co.Ltd., Commercial Complex, Csi Buidling, 2nd Floor, No.1, Officers Lane, Vellore.

4. The Section Officer, VR Section, High Court, Chennai.

P.T.ASHA J. AND N.MALA J. AP CMA Nos.1203, 1204, 1207 & 1212/2022, 2468/2016 and 2380/2016 28-09-2026