Bombay High Court
THE NEW INDIA ASSURANCE CO LTD AND ANRversusSHRI BECHAN PRASAD MAURYA AND ORS
- Decided
- Disposal
- Dismissed
- Bench
- R M JOSHI
Holding
The insurer’s appeal is dismissed and the claimants’ cross‑objection is partly allowed, resulting in an enhanced compensation award.
Summary
The High Court considered an appeal by New India Assurance Ltd under Section 173 of the Motor Vehicle Act challenging a tribunal award of Rs 4,71,000 in a death claim. The insurer argued that the insurance policy was not genuine and that it had been denied a hearing, seeking to set aside the award. The claimants cross‑objected, contending that the tribunal had undervalued the deceased’s monthly earnings and sought higher compensation. The Court held that notice had been properly served, the insurer’s failure to appear justified the ex‑parte award, and no evidence was adduced to prove the policy’s invalidity. Consequently, the insurer’s appeal was dismissed, but the claimants’ cross‑objection was partly allowed, increasing the compensation to Rs 8,55,000 with interest. The insurer was ordered to deposit the enhanced amount within four weeks and the statutory amount to be transferred to the tribunal.
Issues considered
- Whether the insurer can be absolved from liability on the ground that the insurance policy is not genuine.
- Whether the lack of a hearing for the insurer warrants setting aside the tribunal’s award.
- Whether the quantum of compensation should be enhanced based on a higher assessment of the deceased’s earnings.
- Whether ex‑parte proceedings are valid when the insurer fails to appear after proper service of notice.
Legislation cited
- Motor Vehicle Act, 1988 — s. 173
Subjects
- Motor Vehicle Act
- insurance liability
- ex parte proceedings
- compensation enhancement
- death claim
- policy genuineness
- interest
Judgment
93-FA-437-2023++.DOC
Shephali
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CIVIL APPELLATE JURISDICTION
FIRST APPEAL NO. 437 OF 2023
WITH
CROSS OBJECTION (ST) NO. 12598 OF 2024
IN
FIRST APPEAL NO. 437 OF 2023
WITH
FIRST APPEAL NO. 390 OF 2024
WITH
CIVIL APPLICATION NO. 3927 OF 2016
IN
FIRST APPEAL NO. 390 OF 2024
The New India Assurance Co. Ltd …Appellant
Versus
Bechan Prasad Maurya & Ors …Respondents
Ms Pooja Yadav, i/b DR Mahadik, for the Appellant.
Ms Ketki Gokhale (appeared online), i/b AM Gokhale, for the
Respondents.
CORAM: R. M. JOSHI, J.
DATED: 2ND FEBRUARY 2026
PC:-
1. The New India Assurance Company Limited, original
Opponent Nos. 3 and 4 Insurers preferred this Appeal under
SHEPHALI
Section 173 of the Motor Vehicle Act, 1988 against impugned
SANJAY
MORMARE
Digitally signed by
SHEPHALI SANJAY
MORMARE
Date: 2026.02.11
17:29:06 +0530
Page 1 of 6
93-FA-437-2023++.DOC
Judgment and Award dated 17 th October 2015 passed in MACP
No. 164 of 2004, whereby death claim filed by the Claimants came
to be allowed by directing to Respondents Nos. 1, 2 and 4 to
jointly and severally pay a sum of Rs. 4,71,000/- with interest at
the rate of 7% per annum.
2. The Insurer filed Appeal on the ground that original
Opponent No. 4, i.e., Insurer of the the auto rickshaw ought not to
have been saddled with the liability of payment of compensation
as the Insurance Policy relied upon by the Claimants on the face of
it is not a genuine policy. This contention is based upon the
alleged fact that the validity of the said policy was shown from
16th January 1996 to 14 th January 1997 and ordinarily such policy
should have been for a period of one year covering an insured in
respect of the said vehicle. It is claimed that since the matter
proceeded against this Opponent, prejudice has been caused.
3. Learned counsel for the Appellant submits that the
Appellant-Insurer was denied opportunity of hearing before
Tribunal and, hence, this is a fit case for causing interference in
the impugned Judgment and Award and relegating matter back to
the Tribunal for decision afresh. In any case, it is her submission
that the initial burden is upon the Claimants to prove the policy
covering insured in respect of auto rickshaw and since on the face
of it the said policy is not genuine, the the Insurer needs to be
absolved from liability of payment of compensation.
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4. Learned counsel for original Claimants supports the
impugned Judgment and Award in respect of liability of the
Opponents to pay compensation jointly and severally. Exception
however is taken to the quantum of compensation granted by the
Tribunal by preferring cross-objection. It is the contention of the
counsel for Claimants that the Tribunal has wrongly accepted the
income of the deceased to be Rs. 2,600/- per month and the said
income ought to have been taken at Rs. 6,000/- as claimed by the
Claimants in view of the fact that the deceased was doing tailoring
work. This contention was opposed by the learned counsel for the
Insurer.
5. In so far as the service of notice on Insurer/Opponent No. 4
is concerned, record as well as the observations made by the
Tribunal in the impugned Judgment and Order indicates that in
spite of service of notice Opponent Nos. 1, 2, and 4 failed to cause
appearance before the Tribunal and the claim proceeded ex parte
against them. The Opponent No. 3 Insurer of truck filed written
statement at Exhibit-17 denying negligence on the part of the
driver of the said vehicle in occurrence of the accident. Defence is
also taken in respect of breach of terms of the policy. It is further
claimed that the driver of the auto rickshaw has contributed in the
occurrence of the accident to major extent.
6. This is not a case wherein Tribunal passed order proceeding
ex parte against Appellant/Insurer of the auto rickshaw without
service of notice. If the Insurer chose not to cause appearance
before the Trial in spite of receipt of the notice, the consequence
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93-FA-437-2023++.DOC
thereof would certainly follow of proceeding ex parte against such
person. In the facts of the case and also in view of the fact that
notice was duly served on the Insurer, there is no justification for
setting aside the Judgment and Award and to relegate the matter
back to the Tribunal for decision afresh.
7. In absence of appearance of the said Insurer before the
Tribunal, neither issue with regard to the genuineness of the
policy in respect of auto rickshaw has been raised and obviously
the same is not substantiated. This Court therefore finds no reason
to accept the contention of the Appellant.
8. Pertinent to note that the deceased was travelling in auto
rickshaw along with her husband, i.e. Claimant No. 1. She
therefore, cannot be held responsible in any manner whatsoever
in the causing of the accident. Pertinently, both vehicles were
insured with the Appellant-Insurer, the Tribunal has recorded
findings in respect of the liability of payment of compensation by
Opponent Nos. 1, 2 and 4. In the facts of the case and on the basis
of evidence on record, the said findings are fully justified and
hence, appeal of insurer must fail. Insofar as cross-objection for
enhancement of the compensation is concerned, the Claimants
have made evidence before the Tribunal stating that the deceased
was doing tailoring work and was earning Rs. 6,000/- per month.
The learned Tribunal, however, accepted the earning of the
deceased at the rate of Rs. 2,600/-. The said assessment is not
consistent with evidence about the nature of work done by the
Page 4 of 6
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deceased and, hence, it is on lower side. As such, the Claimants
have made out the case for partial enhancement of compensation.
9. The computation of compensation to which claimants are
entitled to is as follows: -
Heads Amount in Rupees
(Rs.)
Loss of earning capacity 6,000/-
dependency per month
Annual income (6000 x 12) 72,000/-
Future Prospects (30%) 21,600/-
Less (-): 1/4th towards 70,200/-
personal Expenses
Appropriate Multiplier (15) 10,53,000/-
Loss of consortium 2,40,000/-
Funeral Expenses 15000/-
Loss of Estate 18,000/-
Total compensation 13,26,000/-
Less (-): Compensation 4,71,000/-
awarded by tribunal
Enhanced compensation 8,55,000/-
10. In view of the above, the following order is passed.
ORDER
(a) The Cross-Objection is partly allowed and both
Appeals are dismissed.
(b) The claimants are entitled to receive additional
compensation of Rs. 8,55,000/- (Rs. Eight Lakhs Fifty
Five Thousand only) alongwith interest at the rate of
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93-FA-437-2023++.DOC
7% per annum from the date of filing of claim
petition till realization of amount.
(c) The appellant is directed to deposit the
additional amount along with accrued interest
thereon within four weeks from the receipt of this
order.
(d) The claimants are permitted to withdraw
the deposited amount along with accrued additional
interest thereon.
(e) The statutory amount be transferred to the
Tribunal along with accrued interest thereon. The
parties are at liberty to withdraw it as per Rule.
11. Pending applications, if any, stand disposed of.
(R. M. JOSHI, J.)
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