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2014 DIGILAW 11 (TRI)

National Insurance Company Ltd. , represented by its Divisional Manager v. Ashulata Bhowmik and Ors

2014-01-13

S.TALAPATRA

body2014
JUDGMENT S. Talapatra, J.:- Heard Mr. S. Lodh, learned counsel appearing for the appellant as well as Mr. A. De, learned counsel appearing for the respondents No. 1 to 5. Since the respondent No. 6 does not have any material interest in this proceeding, no notice has been issued by this court. This is an appeal under Section 173 of the Motor Vehicles Act against the judgment and award dated 10.01.2013 passed by the Motor Accident Claims Tribunal, West Tripura, Agartala, Court No. 4 in T.S. (MAC) No. 154/2011. 2. By this appeal the findings as returned on the factual aspect of the accident or the compensation as assessed by the Tribunal are not questioned. Thus those findings stand affirmed by this court. 3. Mr. S. Lodh, learned counsel appearing for the appellant has meticulously laid down the grounds for challenge in this appeal. According to Mr. Lodh, learned counsel, the grant of 30% of future prospect on account of the deceased who was a businessman is untenable in view of the proposition as settled by a three Judges Bench in Reshma Kumari & Ors. v. Madan Mohan & Anr., reported in: (2013) 9 SCC 65 . In para 39 of Reshma Kumari (supra), the Supreme Court has laid down the law as under: 39. The standardization of addition to income for future prospects shall help in achieving certainty in arriving at appropriate compensation. We approve the method that an addition of 50% of actual salary be made to the actual salary income of the deceased towards future prospects where the deceased had a permanent job and was below 40 years and the addition should be only 30% if the age of the deceased was 40 to 50 years and no addition should be made where the age of the deceased is more than 50 years. Where the annual income is in the taxable range, the actual salary shall mean actual salary less tax. In the cases where the deceased was self-employed or was on a fixed salary without provision for annual increments, the actual income at the time of death without any addition to income for future prospects will be appropriate. A departure from the above principle can only be justified in extraordinary circumstances and very exceptional cases. It goes without further reference that para 39 of Reshma Kumari (supra) is reiteration of Sarla Verma & Ors. A departure from the above principle can only be justified in extraordinary circumstances and very exceptional cases. It goes without further reference that para 39 of Reshma Kumari (supra) is reiteration of Sarla Verma & Ors. v. Delhi Transport Corporation & Anr., reported in (2009) 6 SCC 121 . 4. Mr. Lodh, learned counsel appearing for the petitioner has further submitted that by granting penal interest in the event of failure of making the payment of compensation in due time the Tribunal has committed a serious error. In this context, Mr. Lodh, learned counsel has placed reliance on a decision of the apex court, rendered in National Insurance Co. Ltd. v. Keshav Bahadur & Ors., reported in (2004) 2 SCC 370 , where the apex court in para 13 and 14 has enunciated the law as under: 13. Though Section 110CC of the Act (corresponding to Section 171 of the New Act) confers a discretion on the Tribunal to award interest, the same is meant to be exercised in cases where the claimant can claim the same as a matter of right. In the above background, it is to be judged whether a stipulation for higher rate of interest in case of default can be imposed by the Tribunal. Once the discretion has been exercised by the Tribunal to award simple interest on the amount of compensation to be awarded at a particular rate and from a particular date, there is no scope for retrospective enhancement for default in payment of compensation. No express or implied power in this regard can be culled out from Section110CC of the Act or Section 171 of the new Act. Such a direction in the award for retrospective enhancement of interest for default in payment of the compensation together with interest payable thereon virtually amounts to imposition of penalty which is not statutorily envisaged and prescribed. It is, therefore directed that the rate of interest as awarded by the High Court shall alone be applicable till payment, without the stipulation for higher rate of interest being enforced, in the manner directed by the Tribunal. 14. The insurer cannot withhold the awarded amount indefinitely. In the circumstances, we direct that interest @ 9% per annum on the sum of Rs. 14. The insurer cannot withhold the awarded amount indefinitely. In the circumstances, we direct that interest @ 9% per annum on the sum of Rs. 50,000/- which is the liability of the insurer, from the date of claim till 6.3.1998, be paid within a period of three months from today, if not already paid or deposited before the Tribunal/High Court. The appeal is allowed to the extent indicated, without any order as to costs. [emphasis added] 5. Mr. A. De, learned counsel appearing for the respondents No. 1 to 5 has submitted that after Reshma Kumari (supra), the apex court has re-considered the aspects of grant of future prospect in case of death of the persons who were self-employed and earning the fixed pay in Rajesh & Ors. v. Rajbir Singh & Ors., reported in (2013) 9 SCC 54 . In Rajesh (supra) the Supreme Court has laid down the law which stand totally in conflict with the proposition of Reshma Kumari (supra) by holding that: 8. Since, the Court in Santosh Devi case: (2012) 6 SCC 421 actually intended to follow the principle in the case of salaried persons as laid in Sarla Verma's case: (2009) 6 SCC 121 and to make it applicable also to the self-employed and persons on fixed wages, it is clarified that the increase in the case of those groups is not 30% always; it will also have a reference to the age. In other words, in the case of self-employed or persons with fixed wages, in case, the deceased victim was below 40 years, there must be an addition of 50% to the actual income of the deceased while computing future prospects. Needless to say that the actual income should be income after paying the tax, if any. Addition should be 30% in case the deceased was in the age group of 40 to 50 years. 9. In Sarla Verma's case: (2009) 6 SCC 121 ), it has been stated that in the case of those above 50 years, there shall be no addition. Addition should be 30% in case the deceased was in the age group of 40 to 50 years. 9. In Sarla Verma's case: (2009) 6 SCC 121 ), it has been stated that in the case of those above 50 years, there shall be no addition. Having regard to the fact that in the case of those self-employed or on fixed wages, where there is normally no age of superannuation, we are of the view that it will only be just and equitable to provide an addition of 15% in the case where the victim is between the age group of 50 to 60 years so as to make the compensation just, equitable, fair and reasonable. There shall normally be no addition thereafter. [emphasis added] 6. This Court in National Insurance Company Ltd. v. Smt. Rekha Barma (Debbarma) & Ors. (MAC App. No. 134/2012, decided on 10.12.2013) has also laid down that Reshma Kumari (supra) has not considered Santosh Devi v. National Insurance Company Limited & Ors., reported in (2012) 6 SCC 421 , whereas both Santosh Devi (supra) and Rajesh (supra) have considered the ratio of Sarla Verma (supra) and laid down the principle. 7. In such a situation, it is well settled principle that the subsequent decision of the co-equal bench will govern the decision of this court under Article 141 of the Constitution of India. Apart that, there is a general principle that is followed for purpose of resolving the conflicting decision. The reasoning of the conflicting decisions be weighed and applied in the circumstance of the case [M/S Indo-Swiss Time Limited, Dundahera v. Umrao & Ors., reported in 1981 Punjab & Haryana 213 (Full Bench)]. However, Mr. De, learned counsel appearing for the respondents No. 1 to 5 has candidly submitted that in view of Keshav Bahadur (supra) the imposition of penal interest is no more sustainable. 8. On appreciating the rival contentions as advanced by Mr. Lodh, learned counsel appearing for the appellant and Mr. A. De, learned counsel for the respondent, this court is of the view that Rajesh (supra) shall govern the present case, and as such this court is not inclined to interfere with the grant of future prospect on account of the deceased. But, awarding of penal interest @ 9% cannot sustain in view of the decision of the apex court in Keshav Bahadur (supra). But, awarding of penal interest @ 9% cannot sustain in view of the decision of the apex court in Keshav Bahadur (supra). Accordingly, the penal interest as awarded by the Tribunal is set aside. The appellant is directed to pay the compensation within a period of 2(two) months from today on deducting the amount that has been already paid in the Registry of the High Court. The respondents No. 1 to 5 will be entitled to withdraw the amount from the Registry in terms of the impugned judgment and order on proper identification. If further deposit is made by the appellant-National Insurance Company, the respondents No. 1 to 5 shall be allowed to withdraw the amount in terms of the impugned judgment and order. With this observation, this appeal stands allowed to the extent as indicated above. But, there shall be no order as to costs. Send down the LCRs forthwith.
National Insurance Company Ltd. , represented by its Divisional Manager v. Ashulata Bhowmik and Ors — 2014 DIGILAW 11 (TRI) | DigiLaw