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2014 DIGILAW 1174 (ALL)

New India Assurance Co. Ltd. v. Kaushalya Devi

2014-04-10

OM PRAKASH VII, SANJAY MISRA

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JUDGMENT Om Prakash-VII, J.: - 1. The aforesaid two appeals have been filed against the judgmentward dated 4.9.2004 passed by the Motor Accident Claims Tribunal/Additional District Judge 2, Kanpur Nagar (in short 'the Tribunal') in M.A.C.P. No. 316 of 2002. Since these two appeals involve common questions of fact and law, therefore, the same are being decided by this common judgment. The First Appeal From Order No. 2760 of 2004 is being treated as leading case. 2. The First Appeal From Order No. 2760 of 2004 has been filed by the New India Assurance Co. Ltd. with the prayer to set-aside the aforesaid award on the ground that the Tribunal has illegally awarded the amount in the impugned award. 3. The First Appeal From Order No. 2657 of 2004 has been preferred by the appellants in the said appeal for enhancement of the awarded amount under the impugned award whereby the Tribunal has awarded compensation of Rs. 5,03,000/- along with 8% simple interest. 4. The brief facts of the case are that on 24.1.2002 at about 8.00 a.m. in front of Ghari Soap Factory on G.T. Road, P.S. Chaubeypur, District Kanpur Nagar deceased Ajay Kumar Dwivedi was going on foot extreme left hand side of the road and when he reached in front of Ghari Soap Factory on G.T. Road, one Indica Car bearing registration No. UP 78-Y/8104 coming from Bilhaur side being driven by its driver rashly and negligently, suddenly dashed Ajay Kumar Dwivedi as a result of which he sustained serious multiple fatal injuries and died on spot. First Information Report was lodged on the same day i.e. 24.1.2002 at Police Station Chaubeypur, District Kanpur Nagar. 5. The defendant/owner of the offending vehicle turned-up before the Tribunal and filed written statement denying all the facts mentioned in the claim petition. He also disputed the fact of income and occupation of the deceased mentioned in the claim petition. It was also the case of the owner that the offending vehicle was validly insured with the New India Assurance Company Ltd. on the date and time of the accident and the driver of the offending vehicle was having valid and effective driving licence on the date and time of the accident. 6. It was also the case of the owner that the offending vehicle was validly insured with the New India Assurance Company Ltd. on the date and time of the accident and the driver of the offending vehicle was having valid and effective driving licence on the date and time of the accident. 6. The appellant-insurance company had also filed written statement denying the facts mentioned in the claim petition and also disputed the involvement of the offending vehicle in the said accident. 7. The Tribunal for deciding the matter framed following four issues in Hindi, which have been transcribed in English as under: Issue No. 1 was as to whether on 24.1.2002 at about 8.00 a.m. in front of Ghari Soap Factory at G.T. Road, Thana Chaubeypur the driver of the Indica Car No. U.P. 78 Y-8104 driving the vehicle rashly and negligently dashed the Ajay Kumar as a result of which Ajay Kumar Dwivedi sustained serious injuries and died on the spot. Issue No. 2 was as to whether the Indica Car No. UP 78 Y-8104 was having a valid and effective insurance at the time of the accident. Issue No. 3 was as to whether the Driver of the Indica Car No. U.P. 78 Y-8104 was having valid and effective driving licence at the time of the accident. Issue No. 4 was as to whether the claimant-respondent was entitled to get any compensation. 8. In support of the claim petition the claimants filed nine papers vide list 19C which are photo copy of FIR, post-mortem, application addressed to SHO, application to SSP, Form No. 15 and papers pertaining to trade tax and also examined Smt. Kaushalya Devi as PW-1, Shyam Lal as PW-2 and Ganga Prasad as PW-3. 9. The owner/defendant filed documentary evidence viz. Registration certificate, insurance cover note and driving licence. 10. The insurance company filed investigation report prepared by the investigator of the company and certified copies of the order passed by the Chief Judicial Magistrate, Kanpur Dehat and letter dated 21.5.2004 through list 47-C1. 11. R.P. Shukla has been examined as DW-1. 12. The Tribunal having afforded opportunity to the parties to lead the evidence heard them and allowed the claim petition, as mentioned above. 13. 11. R.P. Shukla has been examined as DW-1. 12. The Tribunal having afforded opportunity to the parties to lead the evidence heard them and allowed the claim petition, as mentioned above. 13. Aggrieved with the impugned judgment and award, the insurance company has filed the First Appeal From Order No. 2760 of 2004, mentioned above, to set aside the aforesaid award on the ground mentioned in the memo of appeal and the claimants have filed the First Appeal From Order No. 2657 of 2004, as mentioned above, for enhancement of compensation on the ground mentioned in the memo of appeal. 14. Affidavits have been exchanged between the parties. 15. We have heard Shri V.C. Dixit, learned counsel for the insurance company and Shri Achint Ranjan Singh, learned counsel for the claimants and have gone through the entire record. 16. It is submitted by Shri V.C. Dixit, learned counsel for the insurance company that there was no sufficient evidence on record regarding involvement of the offending vehicle in the said accident because the FIR has been lodged against an unknown person and only the type of vehicle has been mentioned in the FIR. After investigation, the police has submitted final report. It is further submitted that the witnesses examined by the claimants are not eye-witnesses account and PW-2 Shyam Lal was also not present on the spot as is clear from his oral evidence. 17. Assailing the amount of compensation he has submitted that no loss has been caused to the dependents of the deceased because the business run by the deceased is still continuing, therefore, income assessed by the Tribunal is on higher side. He further submits that the multiplier used for calculating the income is also against the provisions of the law. 18. On the other hand, Shri Achint Ranjan Singh, learned counsel for the claimants has submitted that the FIR has not been lodged by any of the eye-witnesses but the type of vehicle has been mentioned. Other particulars regarding involvement of the offending vehicle had been provided by the father of the deceased to the police at the earliest possible time but the police did not take into account those facts and not collected evidence in that perspective and unfairly submitted final report. It has also been submitted that protest petition has been filed challenging the conclusion of the investigating officer. It has also been submitted that protest petition has been filed challenging the conclusion of the investigating officer. The concerned Magistrate has rejected the final report and summoned the accused in the matter. He has further submitted that the deceased was running an established business and there was a clear proof of his income because income tax return and other documents showing the annual income of the deceased have been filed. If the deceased was aged about 23 years and his business was a flourishing business then only deduction permissible under law might have been deducted for calculating the annual income and compensation. It is further submitted that the Tribunal illegally and without any basis assessed the income of the deceased as Rs. 4,000/- per month. The deduction is also not in accordance with law. The annual income of the deceased must have been calculated only after deduction of the usual income tax. He has placed reliance on the following decisions: 1. Sarla Verma & Ors. v. Delhi Transport Corp. & another, (2009) 6 SCC 121 : ( AIR 2009 SC 3104 ). 2. Vimal Kanwar and others v. Kishore Dan and others, (2013) 7 SCC 476 : (AIR 2013 SC (Civ) 1783). 19. We have considered the submissions made by the learned counsel for the parties and have gone through the entire record carefully. 20. Before proceeding to deal with the submissions made by the learned counsel for the parties, it will be appropriate to quote paragraphs 26, 27, 28, 29 and 30 of Vimal Kanwar case (AIR 2003 SC (Civ) 1783) (supra), which are as under: "26. The fourth issue is "whether the compensation awarded to the appellants is just and proper." 27. For determination of this issue, it is required to determine the percentage of increase in income to be made towards prospects of advancement in future career and revision of pay. In General Manager, Kerala State Road Transport Corporation, Trivandrum v. Susamma Thomas (1994) 2 SCC 176 : ( AIR 1994 SC 1631 ) this Court noticed the age and income of the deceased for determination of future prospects of advancement in life and career. The Court held as follows: "19. In the present case the deceased was 39 years of age. His income was Rs. The Court held as follows: "19. In the present case the deceased was 39 years of age. His income was Rs. 1032/- per month, of course, the future prospects of advancement in life and career should also be sounded in terms of money to augment the multiplicand. While the chance of the multiplier is determined by two factors, namely, the rate of interest appropriate to a stable economy and the age of the deceased or of the claimant whichever is higher, the ascertainment of the multiplicand is a more difficult exercise. Indeed, many factors have to be put into the scales to evaluate the contingencies of the future. All contingencies of the future need not necessarily be baneful. The deceased person in this case had a more or less stable job. It will not be inappropriate to take a reasonably liberal view of the prospects of the future and in estimating the gross income it will be unreasonable to estimate the loss of dependency on the present actual income of Rs. 1032/- per month. We think, having regard to the prospects of advancement in the future career, respecting which there is evidence on record, we will not be in error in making a higher estimate of monthly income at Rs. 2000/- as the gross income." 28. In New India Assurance Co. Ltd. v. Gopali & Ors. reported in AIR 2012 SC 3381 this Court noticed that the High Court determined the compensation by granting 100% increase in the income of the deceased. Taking into consideration the fact that in the normal course, the deceased would have served for 22 years and during that period his salary would have certainly doubled, this Court, upheld the judgment of the High Court. 29. In K.R. Madhusudhan v. Administrative Officer (2011) 4 SCC 689 : ( AIR 2011 SC 979 ) this Court observed that there can be departure from the rule of thumb and held as under "10. The present case stands on different factual basis where there is clear and incontrovertible evidence on record that the deceased was entitled and in fact bound to get a raise in income in the future, a fact which was corroborated by evidence on record. Thus, we are of the view that the present case comes within the "exceptional circumstances" and not within the purview of the rule of thumb laid down by Sarla Verma judgment. Thus, we are of the view that the present case comes within the "exceptional circumstances" and not within the purview of the rule of thumb laid down by Sarla Verma judgment. Hence, even though the deceased was above 50 years of age, he shall be entitled to increase in income due to future prospects." 30. Recently in Santosh Devi v. National Insurance Company Ltd. reported in (2012) 6 SCC 421 : ( AIR 2012 SC 2185 ) this Court found it difficult to find any rationale for the observation made in paragraph 24 of the judgment in Sarla Verma's case and observed as follows: "14. We find it extremely difficult to fathom any rationale for the observation made in para 24 of the judgment in Sarla Verma case ( AIR 2009 SC 3104 ) that where the deceased was self-employed or was on a fixed salary without provision for annual increment, etc., the courts will usually take only the actual income at the time of death and a departure from this rule should be made only in rare and exceptional cases involving special circumstances. In our view, it will be naive to say that the wages or total emoluments/income of a person who is self-employed or who is employed on a fixed salary without provision for annual increment, etc., would remain the same throughout his life. 15. The rise in the cost of living affects everyone across the board. It does not make any distinction between rich and poor. As a matter of fact, the effect of rise in prices which directly impacts the cost of living is minimal on the rich and maximum on those who are self-employed or who get fixed income/emoluments. They are the worst affected people. Therefore, they put in extra efforts to generate additional income necessary for sustaining their families. 18. Therefore, we do not think that while making the observations in the last three lines of para 24 of Sarla Verma's judgment, the Court had intended to lay down an absolute rule that there will be no addition in the income of a person who is self-employed or who is paid fixed wages. 18. Therefore, we do not think that while making the observations in the last three lines of para 24 of Sarla Verma's judgment, the Court had intended to lay down an absolute rule that there will be no addition in the income of a person who is self-employed or who is paid fixed wages. Rather, it would be reasonable to say that a person who is self-employed or is engaged on fixed wages will also get 30% increase in his total income over a period of time and if he/she becomes the victim of an accident then the same formula deserves to be applied for calculating the amount of compensation." 21. The Tribunal while deciding issue No. 1 regarding factum of the accident and involvement of the offending vehicle in the said accident after discussion of the evidence adduced by the parties has concluded that - "from the aforesaid discussions, I am satisfied that the accident is proved and it is also proved that Vehicle No. U.P. 78-Y 8104 was involved in the accident in which deceased Ajay Kumar died in the accident. I failed to understand as to why the driver of the vehicle was not produced in evidence by the opposite parties. The assertion by the opposite party that the driver was not arrested and vehicle was not seized, is of no consequence because the Police did not take action at all within next two months. Therefore, the Issue No. 1 is decided in affirmative." 22. If the conclusion taken by the Tribunal is analysed in consonance with the facts of the present case and the evidence available on record, it reveals that the FIR had not been lodged in the matter by PW-2 Shyam Lal, who is said to be an eye-witness but it has been lodged by the Managing Director of Bhagwati Rice Mills, who is not an eye-witness. In motor accident claim petitions lodging of an FIR is not material if the involvement of vehicle in the said accident is established by the evidence of the parties. In the instant case, type of the vehicle has been mentioned in the FIR. The father of the deceased had informed to the Police about the registration number of the offending vehicle just after few days of the accident. In the instant case, type of the vehicle has been mentioned in the FIR. The father of the deceased had informed to the Police about the registration number of the offending vehicle just after few days of the accident. From the Tribunal's finding that the police unfairly did not take action and not arrested the driver and even not seized the vehicle, no adverse inference can be drawn against the claimants case out of failure of the police to investigate the matter. Even if FIR has not been lodged regarding the accident, a claim petition can be considered by the Tribunal and compensation can be awarded. The Tribunal has scrutinized the evidence of the claimants in right perspective. Nothing has come out to take adverse inference against the claimants regarding involvement of the offending vehicle in the said accident. 23. Considering and analysing the entire evidence, we are of the firm view that the claimants have been able to establish the involvement of the offending vehicle in the said accident by their evidence. The Tribunal has rightly concluded that the accident is the result of rash and negligent driving of the driver of the offending vehicle. Therefore, we are unable to accept the submissions made by the learned counsel for the insurance company in this regard. 24. It is also pertinent to note that proceeding adopted in deciding claim cases are of summary in nature. No strict principle of C.P.C. or Cr.P.C. can be adhered to in deciding such type of matters. The insurance company has not been able to make out any case supported with evidence that the offending vehicle was not involved in the accident in question. On the basis of the aforesaid discussions, we are of the view that the finding recorded by the Tribunal on issue No. 1 is in conformity with the fact of the case and evidence available on record. 25. As far as the finding arrived at by the Tribunal on issue Nos. 2 and 3 are concerned, learned counsel for the insurance company did not challenge it during the course of argument, hence, we do not find it necessary to discuss the findings of the Tribunal on these issues. 26. 25. As far as the finding arrived at by the Tribunal on issue Nos. 2 and 3 are concerned, learned counsel for the insurance company did not challenge it during the course of argument, hence, we do not find it necessary to discuss the findings of the Tribunal on these issues. 26. So far as the finding arrived at on issue No. 4 with respect to compensation amount and the submissions raised by the learned counsel for the parties are concerned, it is clear from the record that the deceased was aged about 23 years at the time of accident and was running a flourished business of whole-sale grain merchant. Acknowledgment of filing of income tax return for the financial year 2001-02 had been filed before the Tribunal showing the income tax paid on the income accrued till 23.1.2002. The accident was taken place on 24.1.2002. Rs. 14,280/- has been paid towards income tax and the annual income has been shown as Rs. 1,25,000/-. The deceased had also paid sales tax for his business. The Tribunal while computing compensation has deducted the income tax paid for the assessment year 2002-03 from the annual income but has assessed the income of the deceased only Rs. 4,000/- per month. On deduction of income tax paid for the assessment year 2002-03 from the annual income, the net income remained with the deceased Rs. 1,10,720/-, i.e. approximately Rs. 9,220/-. The Tribunal has not taken into account this monthly income for calculating the compensation for the reason that the claimants have not adduced evidence that the business run by the deceased has been closed. The Tribunal has opined that - "the age of the father of the deceased is 48 years so the possibility still exist that the business might have not been totally closed. So keeping those factors in mind the income has to be considered." Thus Rs. 4,000/- per month has been taken as per month income of the deceased at the time of the accident. The question is whether the views taken by the Tribunal are correct or the Tribunal ought to have calculated the compensation on the basis of annual income shown in the income tax return, mentioned above. 4,000/- per month has been taken as per month income of the deceased at the time of the accident. The question is whether the views taken by the Tribunal are correct or the Tribunal ought to have calculated the compensation on the basis of annual income shown in the income tax return, mentioned above. Since the views taken by the Tribunal on the basis that there is no evidence that the business run by the deceased is totally closed may be correct, therefore, we are of the view that another possible view for calculation of compensation on the basis of income shown in the income tax return be not substituted over the view of the Tribunal but the Tribunal, for awarding just and proper compensation, must have taken into consideration the age of the deceased, number of dependents and type of business and future prospect of the deceased. If the deceased had lived, there was possibility that he might have increased his business and income. Thus, in view of the above, we find just and proper to enhance the compensation amount on the basis of future prospects. 27. It is also pertinent to mention here that although this appeal is a statutory appeal, yet the court cannot loose sight of the fact and law for awarding just and proper compensation. 28. Considering the age of the deceased and number of dependents, 50% of the annual income assessed by the Tribunal is increased for calculating the compensation. Per month income assessed by the Tribunal is worth Rs. 4,000/-, which comes to Rs. 48,000/- per annum. On deduction of one third of the deceased income in lieu of personal expenses, the annual loss of dependency comes to Rs. 32,000/- per annum. The Tribunal has applied a multiplier of 16 although in the second schedule of the Motor Vehicles Act for the age group of the deceased, a multiplier of 17 has been provided. Considering the discretion exercised by the Tribunal in applying the multiplier, we do not propose to apply the multiplier of 17. Thus, the annual loss of dependency i.e. Rs. 32,000/- if multiplied with 16, then it comes to Rs. 5,12,000/-. On addition of 50% of the loss of dependency i.e. Rs. 2,56,000/-, the total loss of dependency will be Rs. 7,68,000/-. Thus, the annual loss of dependency i.e. Rs. 32,000/- if multiplied with 16, then it comes to Rs. 5,12,000/-. On addition of 50% of the loss of dependency i.e. Rs. 2,56,000/-, the total loss of dependency will be Rs. 7,68,000/-. Besides this, the amount awarded on the other score by the Tribunal if added to the above calculated compensation, the total compensation comes to Rs. 7,75,000/-. 29. Since the claimants have impleaded the insurance company as party in the claim petition on 27.1.2003, therefore, the rate of interest and the date from which interest shall be payable are also not interfered with. 30. In view of the discussions made above, we are of the view that the First Appeal From Order No. 2760 of 2004 lacks merits and is liable to be dismissed. 31. The First Appeal From Order No. 2760 of 2004 is accordingly dismissed. 32. For the reasons given above, the First Appeal From Order No. 2657 of 2004, preferred by the claimants for enhancement, is hereby allowed and the judgment and award dated 4.9.2004 is modified and the compensation is enhanced U.P. to Rs. 7,75,000/- with simple interest @8% per annum payable by the insurance company from the date mentioned in the impugned award. 33. Stay order/interim order, if any, stands vacated. 34. The amount, if any, deposited during pendency of the appeals, if still lying in these appeals, be remitted back to the Tribunal for payment to the claimants. 35. Let a copy of this judgment and order be also placed in First Appeal From Order No. 2657 of 2004. No order as to costs.