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2021 DIGILAW 1659 (RAJ)

United India Insurance Co. Ltd. v. Pushpa

2021-09-07

MANOJ KUMAR GARG

body2021
ORDER : Manoj Kumar Garg, J. 1. The instant civil misc. appeal under Section 173 of the Motor Vehicle Act, 1988 has been preferred by the United India Insurance Company Ltd. against the judgment and award dt. 08.01.2016 passed by the Motor Accident Claims Tribunal No. 1, Udaipur (for short 'the Tribunal') in Claim Case No. 878/2014, whereby the learned Tribunal has granted compensation to the tune of Rs. 16,33,000/- in favour of the respondents/claimants. 2. Briefly stated the facts of the case are that the claimants filed a claim petition before the Tribunal with the averments that on 14.09.2014 at about 5:30-6:00 in the evening, Amrit Lal was going on his motorcycle bearing registration No. RJ-27 JS 9068 towards his house. A car, bearing registration No. RJ-27 CD 0268 came from the opposite side, which was driven rashly and negligently by its driver-Imran, hit the said motorcycle as well as the pedestrians, Raju and Kishan Lal. Due to which, Amrit Lal and Kishan Lal died and Raju sustained injuries. It is stated in the claim petition that deceased-Kishan Lal during his life time was working as Labour and was having monthly income of Rs. 9000/-. He was 24 years of age at the time accident. The claimants-respondents, who are dependent of the deceased Kishan Lal, including the minor children, claimed amount of Rs. 30,65,000/- towards different heads. 3. The respondents filed their reply to the claim petition and denied the averments made therein. On the basis of the pleadings of the parties, the learned Tribunal framed four issues. The Tribunal recorded the oral as well as documentary evidence on behalf of the claimants. The respondents did not produce any evidence in support of their case. After hearing both the parties vide its common judgment and award dated 08.01.2016 awarded a compensation of Rs. 16,33,000/- in favour of the claimants/respondents No. 1 to 6. Hence, this misc. appeal has been filed by the Insurance Company. 4. Learned counsel for the appellants submitted that the learned tribunal while awarding the quantum of compensation has wrongly taken into consideration the monthly income of the deceased as Rs. 6000/-. It is submitted that the claimants failed to produce any evidence regarding the income of the deceased and therefore, as per the Minimum Wages Act, the minimum wage i.e. Rs. Learned counsel for the appellants submitted that the learned tribunal while awarding the quantum of compensation has wrongly taken into consideration the monthly income of the deceased as Rs. 6000/-. It is submitted that the claimants failed to produce any evidence regarding the income of the deceased and therefore, as per the Minimum Wages Act, the minimum wage i.e. Rs. 5174/-, which was prevalent in the year 2014 should have been taken into account while computing the income of the deceased. It is further stated that the deceased was not earning regular income from a stable employment having future prospects and therefore, the learned Tribunal was not justified in awarding 50% towards loss of future prospects. Learned counsel for the appellant-Insurance Company has placed reliance upon the judgment rendered in the case of New Indian Assurance Co. Ltd. Vs. Smt. Somwati & ors. [Civil Appeal No. 3093 of 2010] and connected appeals, decided on Sep. 07, 2020. It is argued that the amount of compensation awarded by the learned tribunal in favour of the claimants is excessive, which deserves to be modified accordingly. 5. Per contra, the learned counsel for the respondent-claimants opposed the submissions advanced by the counsel for the appellants and submitted that the award passed by the learned Tribunal is just and proper which does not call for any interference. 6. I have considered the submissions on behalf of the counsel for the parties and perused the impugned judgment & award dated 08.01.2016 as also material available on record. 7. In the case of Sarla Verma & ors. Vs. Delhi Transport Corporation & Anr., reported in (2009) 6 SCC 121 , the Apex Court had dealt with the issue of future prospect of addition to the income, and had observed as under :- "..... In view of the imponderables and uncertainties, we are in favour of adopting as a rule of thumb, an addition of 50% of actual salary to the actual salary income of the deceased towards future prospects, where the deceased had a permanent job and was below 40 years. (Where the annual income is in the taxable range the words "actual salary" should be read as "actual salary less tax"). The addition should be only 30% if the age of the deceased was 40 to 50 years. There should be no addition, where the age of the deceased is more than 50 years. (Where the annual income is in the taxable range the words "actual salary" should be read as "actual salary less tax"). The addition should be only 30% if the age of the deceased was 40 to 50 years. There should be no addition, where the age of the deceased is more than 50 years. Though the evidence may indicate a different percentage of increase, it is necessary to standardise the addition to avoid different yardsticks being applied or different methods of calculation being adopted. Where the deceased was self-employed or was on a fixed salary (without provision for annual increments, etc.), the courts will usually take only the actual income at the time of death. A departure therefrom should be made only in rare and exceptional cases involving special circumstances." 8. In the case of National Insurance Co. Ltd. V. Pranay Sethi & Ors., reported in (2017) 16 SCC 680 , the Constitution Bench evaluated all the judicial precedents on the issue of future prospects including Sarla Verma (supra), and devised a fixed standard for granting future prospects. It was held: "57. Having bestowed our anxious consideration, we are disposed to think when we accept the principle of standardization, there is really no rationale not to apply the said principle to the self-employed or a person who is on a fixed salary. To follow the doctrine of actual income at the time of death and not to add any amount with regard to future prospects to the income for the purpose of determination of multiplicand would be unjust. The determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as postulated Under Section 168 of the Act. In case of a deceased who had held a permanent job with inbuilt grant of annual increment, there is an acceptable certainty. But to state that the legal representatives of a deceased who was on a fixed salary would not be entitled to the benefit of future prospects for the purpose of computation of compensation would be inapposite. It is because the criterion of distinction between the two in that event would be certainty on the one hand and staticness on the other. One may perceive that the comparative measure is certainty on the one hand and uncertainty on the other but such a perception is fallacious. It is because the criterion of distinction between the two in that event would be certainty on the one hand and staticness on the other. One may perceive that the comparative measure is certainty on the one hand and uncertainty on the other but such a perception is fallacious. It is because the price rise does affect a self-employed person; and that apart there is always an incessant effort to enhance one's income for sustenance. The purchasing capacity of a salaried person on permanent job when increases because of grant of 19 increments and pay revision or for some other change in service conditions, there is always a competing attitude in the private sector to enhance the salary to get better efficiency from the employees. Similarly, a person who is self-employed is bound to garner his resources and raise his charges/fees so that he can live with same facilities. To have the perception that he is likely to remain static and his income to remain stagnant is contrary to the fundamental concept of human attitude which always intends to live with dynamism and move and change with the time. Though it may seem appropriate that there cannot be certainty in addition of future prospects to the existing income unlike in the case of a person having a permanent job, yet the said perception does not really deserve acceptance. We are inclined to think that there can be some degree of difference as regards the percentage that is meant for or applied to in respect of the legal representatives who claim on behalf of the deceased who had a permanent job than a person who is self-employed or on a fixed salary. But not to apply the principle of standardization on the foundation of perceived lack of certainty would tantamount to remaining oblivious to the marrows of ground reality. And, therefore, degree-test is imperative. Unless the degree-test is applied and left to the parties to adduce evidence to establish, it would be unfair and inequitable. The degree-test has to have the inbuilt concept of percentage. And, therefore, degree-test is imperative. Unless the degree-test is applied and left to the parties to adduce evidence to establish, it would be unfair and inequitable. The degree-test has to have the inbuilt concept of percentage. Taking into consideration the cumulative factors, namely, passage of time, the changing society, escalation of price, the change in price index, the human attitude to follow a particular pattern of life, etc., an addition of 40% of the established income of the deceased towards future prospects and where the deceased was below 40 years an addition of 25% where the deceased was between the age of 40 to 50 years would be reasonable. 9. In the case of New India Assurance Co. Ltd. Vs. Smt. Somwati & Ors., (supra), the Apex Court while setting aside the award of compensation under the conventional head "loss of love and affect" held as under:- "46. .......As noted above, we have taken the view that the order of the High Court awarding compensation towards 'loss of love and affection' at the rate of Rs. 50,000/- to each of the claimants is unjustified which is being set aside in this appeal. We, further, in the above appeal also set aside the directions of the High Court in paragraph 9 by which statutory amount along with interest accrued thereon was directed to be deposited in AASRA fund." 10. In the instant case, it is not disputed that the claimants did not produce any evidence regarding the income of the deceased. The learned Tribunal has considered the minimum wages for computing the income of the deceased i.e. Rs. 6000/- per month without considering the minimum wages prevalent at the relevant time. Accordingly, to learned counsel for the appellant, the minimum wages prevalent in the year 2014 was Rs. 5174/- per month, which is not disputed by the learned counsel for the claimants. 11. It is also no doubt true that it is only in exceptional cases where existence of future prospects is established, since deceased did not have a regular income in a stable job, is not entitled to 50% future loss of prospects. The claimants having failed to place relevant material before Tribunal to establish such loss of future prospects, award of Rs. 4,86,000/- (50% of the annual income) is unjust. Therefore, the appellant is held entitled for 40% of future prospects. 12. The claimants having failed to place relevant material before Tribunal to establish such loss of future prospects, award of Rs. 4,86,000/- (50% of the annual income) is unjust. Therefore, the appellant is held entitled for 40% of future prospects. 12. Hence the compensation deserves to be recalculated as under:- Monthly salary Rs.5174/- Multiplier 18 (age 23 years) Rs.5174 X 12 X 18 =Rs.11,17,584/- Future prospects 40% Rs.4,47,033/- Rs.11,17,584 + 4,47,033 = Rs.15,64,617/- 1/5 Deduction Rs.15,64,617 – Rs.3,12,923/- = Rs.12,51,694/- Non pecuniary Loss Rs.2,70,000/- Total Rs.12,51,694 + Rs.2,70,000/- = Rs.15,21,694/- Amount liable to be reduced Rs.16,33,000/- – Rs.15,21,694/- = Rs. 1,11,306/- 13. Accordingly, the appeal is partly allowed and while modifying the judgment and award dated 08.01.2016, in all the claimants are held entitled to get compensation to a sum of Rs. 15,21,694/- instead of Rs. 16,33,000/- as awarded by the Tribunal. The claimants will also be entitled to interest on the enhanced amount of compensation at the rate of 6% per annum from the date of filing the claim petition till realisation. This Court vide order dt. 26.02.2016 had stayed the operation of the impugned judgment subject to the appellant-Insurance Company depositing of Rs. 10,00,000/- before the Tribunal. The claimants were granted liberty to withdraw the same. The appellant Insurance Company is directed to pay the balance amount of compensation within a period of one month.