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2018 DIGILAW 367 (ALL)

Archana Shukla v. Joss Real Estate

2018-02-08

BALA KRISHNA NARAYANA, IRSHAD ALI

body2018
JUDGMENT : B. K. Narayana, J. Heard Sri Vashistha Tiwari, learned counsel for the appellants. This appeal has been preferred by the claimants/appellants for enhancement of compensation awarded to them by the M.A.C.T./Additional District Judge, Court No.6, Deoria by judgement and award dated 07.04.2012 for the death of Bhanu Prakash Shukla, husband of claimant/appellant no.1 and father of claimant/appellant no.2, who was aged about 54 years at the time of the accident which had taken place on 26.02.2010 at about 10 p.m. while he was going from Delhi to Lucknow along with his wife, claimant/appellant no.1 in a Lancer Car, bearing registration no. D.L. 7C-A-4185, hereinafter referred to as the offending vehicle, owner whereof was respondent no.1, which on account of being driven rashly and negligently by its driver, collided with a tractor trolley from behind which was parked on the left side of the road. The Tribunal by its judgement and award allowed the claim petition in part against the respondent nos. 1 and 2 and directed the respondent no. 2 to pay a sum of Rs. 33,19,162/- as compensation to the claimants/appellants. The Tribunal by the impugned judgement and award calculated the compensation in the following manner:- After making necessary deductions, the Tribunal held that the deceased, who at the time of his death was working on the post of Deputy Director in the Central Pollution Board, Ministry of Environment and Forest, Government of India, was earning Rs. 76,441/- per month or Rs. 9,17,292/- p.a. The Tribunal also deducted the yearly income tax of the deceased i.e. Rs. 1,34,392 from his annual income and thus, the actual annual income of the deceased was calculated as Rs. 7,82,900/-. The Tribunal held that the deceased would have spent 1/3rd amount on his living and personal expenses and after deducting the aforesaid amount, he would have contributed a sum of Rs. 5,21,934/- to the family expenditure. The Tribunal further held that the deceased's monthly transport allowance which was Rs. 4064/- or Rs. 48,768/- p.a. was liable to be deducted from Rs. 5,21,934/- and after deducting the same held that the deceased would have contributed Rs. 4,73,166/- p.a. towards his family contribution. Considering the age of the deceased which at the time of his death was between 51-55 years, the Tribunal applied the multiplier of 7 to the multiplicand and determined the total loss of dependency as Rs. 33,12,162/-. 5,21,934/- and after deducting the same held that the deceased would have contributed Rs. 4,73,166/- p.a. towards his family contribution. Considering the age of the deceased which at the time of his death was between 51-55 years, the Tribunal applied the multiplier of 7 to the multiplicand and determined the total loss of dependency as Rs. 33,12,162/-. The Tribunal thereafter proceeded to award Rs. 2,000/- and Rs. 5000/- under the conventional heads of funeral expenses and loss of consortium respectively and assessed the total compensation as Rs. 33,19,162/-. Learned counsel for the appellants submitted that the impugned judgement and award suffers from following infirmities:- 1. The Tribunal erred in not awarding any amount towards the future prospects of the deceased. 2. Considering the age of the deceased at the time of his death, the Tribunal wrongly applied the multiplier of 7 while calculating the total loss of dependency whereas the correct multiplier to be applied was 11. 3. While computing the yearly income of the deceased, the Tribunal arbitrarily deducted the income tax paid by the deceased on his income although the amount deducted as income tax was part of his monthly income. 4. The amount awarded under the conventional heads is too meagre. In support of his contentions, learned counsel for the appellants place reliance upon the case of National Insurance Company Limited Versus Pranay Sethi and Others reported in 2017 ACJ 2700 (SC). We have heard learned counsel for the appellants and perused the impugned judgement and award as well as other material brought on record and we find force in his submissions. The constitutional bench of the Apex Court in the case of National Insurance Company Limited Versus Pranay Sethi and Others reported in 2017 ACJ 2700 (SC) in sub-paragraph (iii) to (viii) of paragraph 61 has ruled inter-alia; that while determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax; in case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component; for determination of the multiplicand, the deduction for personal and living expenses, the tribunals and the courts shall be guided by paragraphs 14 to 15 of Smt. Sarla Verma and others Vs. Delhi Transport Corporation and another reported in 2009 (2) T.A.C. 677 (S.C.); the selection of multiplier shall be as indicated in the Table in Smt. Sarla Verma (supra) read with para 21 of that judgment; the age of the deceased should be the basis for applying the multiplier; reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs. 15,000/-, Rs. 40,000/- and Rs. 15,000/- respectively. The aforesaid amounts should be enhanced at the rate of 10% in every three years. According to the principle stated by the Apex Court in the case of Smt. Sarla Verma (supra), in the correct multiplier to be used where the deceased is aged between 51 to 55 years is 11. The Tribunal in our opinion erred in applying the multiplier of 7 on the basis of the actual age of the deceased. Since in this case, the deceased at the time of his death was aged about 54 years, the correct multiplier to be applied is 11. The Tribunal further erred in not awarding any amount towards future prospects. The constitutional Bench in the case of Pranay Sethi (supra) in its sub-paragraph (iii) of paragraph 61 has ruled that while determining the income, an addition of 15% of the actual income to the income of the deceased towards future prospects should be made where the deceased was between the age of 50 to 60 years. The constitutional Bench in the case of Pranay Sethi (supra) in its sub-paragraph (iii) of paragraph 61 has ruled that while determining the income, an addition of 15% of the actual income to the income of the deceased towards future prospects should be made where the deceased was between the age of 50 to 60 years. In the present case since the deceased was aged about 54 years on the date of the accident, an addition of 15% of his actual income should be made to the income of the deceased towards future prospects while determining his gross income. The amounts awarded under the conventional heads of funeral expenses and loss of consortium are also liable to be increased in accordance with the principles laid down in the case of Pranay Sethi (supra). We however do not find any force in the submissions made by the learned counsel for the appellants that the Tribunal committed any error in deducting the amount of income tax paid by the deceased on his income while computing his yearly income. We accordingly proceed to recalculate the compensation in the light of the aforesaid principles. As noted above, the monthly income of the deceased was Rs. 76,441/- or Rs. 9,17,292/- p.a. By adding 15% towards future prospects as the deceased was between the age of 50 to 60 years and belonged to salaried class, the deemed gross income of the deceased would be Rs. 76,441/ + 15% of Rs. 76,441/- = Rs. 87,907/- per month or Rs. 10,54,884/- p.a. After deducting 1/3rd amount (i.e. 87,907-29,302) towards the living and personal expenses of the deceased, his contribution to the family is determined as Rs. 58,605/- per month or Rs. 7,03,260/- p.a. After applying the multiplier of 11, the total loss of dependency is assessed as Rs. 77,35,860/-. We further award a sum of Rs. 15,000/- towards funeral expenses and Rs. 40,000/- under the head of loss of consortium. We accordingly increase the compensation awarded to the claimants/appellants by the Tribunal from Rs. 33,19,162/- to Rs. 77,90,860/-. The claimants/appellants shall further be entitled to interest @ 7% p.a. on the increased amount of compensation from the date of filing of the claim petition till the actual payment is made. The appeal is allowed in part. The impugned judgement and award stands modified to the extent indicated hereinabove. The parties shall bear their respective costs.