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Allahabad High Court · body

2022 DIGILAW 1806 (ALL)

New India Assurance Co. Ltd. v. Sunita Yadav

2022-11-16

AJAY BHANOT

body2022
JUDGMENT : AJAY BHANOT, J. (I) INTRODUCTION 1. The two appeals, namely FAFO No. 1327 of 2015 and FAFO No. 1925 of 2015 arise out of an award made by the learned Motor Accident Claims Tribunal/Additional District Judge, Allahabad [hereinafter referred to as the “learned tribunal”] in Motor Accident Claim Petition No. 816 of 2013 dated 24.03.2015. The appeals have been filed by the Insurance Company and the claimants who are dependants of the deceased respectively. 2. The appeal, namely FAFO No. 1824 of 2016 arise out of an award made by the learned Motor Accident Claims Tribunal/Additional District Judge, Allahabad in Motor Accident Claim Petition No. 948 of 2013 dated 17.03.2016 by partly allowing the claim of the injured-claimant. The instant appeal has been filed by the injured-claimant. 3. The above said three appeals arise out of the same accident and are being decided by a common judgment. (II) Case of the claimants and respondents before the learned tribunal: 4. Briefly the case of the claimants before the learned tribunal was that the deceased Charan Singh died in an accident on 12.06.2013 which was caused solely by the rash and negligent driving of the driver of offending truck bearing Registration No. UP-70-J-9831. On the fateful day deceased Charan Singh was driving motorcycle bearing registration No. UP-73-D-0335 with Ghanshyam Singh riding pillion. Ghanshyam Singh suffered grievous injuries in the said accident. The offending vehicle was insured by New India Assurance Co. Ltd. The claimants are the dependants of the deceased. The deceased was 28 years of age at the time of his death. (III) Compensation awarded by the learned tribunal 5. The learned tribunal in the impugned award dated 24.03.2015 partly allowed the claim petition and awarded compensation which is depicted in tabulated form hereunder: S. No. Heads Amount Awarded by the tribunal 1. Monthly Income (A) 4,000/- 2. Annual Income (B) (Ax12=B) 48,000/- 3. Future Prospects (C) 50% (Rs. 24,000/-) 48,000 + 24,000 = 72,000/- 4. Deduction towards personal expenses (D) (1/3 of B) 1/3 of 24,000/- = 72,000 - 24000/- = 48,000/- 5. Annual Loss of dependancy (E) (B-D = E) 48,000 6. Multiplier (F) 18 7. Total loss of dependancy (ExF) 48000 x 18 = 8,64,000/- 8. Conventional Heads (a) Loss of consortium 9500/- (b) loss of Estate (c) Funeral Expenses 9. Total compensation 8,64,000 + 9500 = 8,73,500/- 10. Interest 7% 6. Annual Loss of dependancy (E) (B-D = E) 48,000 6. Multiplier (F) 18 7. Total loss of dependancy (ExF) 48000 x 18 = 8,64,000/- 8. Conventional Heads (a) Loss of consortium 9500/- (b) loss of Estate (c) Funeral Expenses 9. Total compensation 8,64,000 + 9500 = 8,73,500/- 10. Interest 7% 6. The compensation awarded to the injured by learned tribunal in the impugned judgment dated 17.03.2016 is depicted in tabulated form hereunder: S. No. Heads Amount Awarded by the tribunal 1. Medical expenses 1,09,925.19/- 2. Special diet 6,000/- 3. Grievous injuries 5,000/- 4. Loss of income 6,000/- 5. Total compensation 1,09,925.19 + 6000 + 5000 + 6000 = 1,26,925/- 6. Interest 7% 7. The appeals filed by the claimants and the injured respectively seek enhancement of compensation. The Insurance Company in appeals has assailed the quantum of compensation as being excessive. (IV) Submissions of learned counsels for the parties: 8. Shri Ujwal, Advocate holding brief of Shri Kartikeya Saran, learned counsel for the appellant-Insurance Company in FAFO No. 1327 of 2015 submits that though many grounds have been pleaded in the memo of appeal, only three grounds are being pressed. Firstly, the tribunal erred in law by fixing the entire liability on the appellant-insurance company though it was a case of contributory negligence. Secondly, the income of the deceased was not established. Thirdly, an incorrect multiplier was applied to the facts of the case. 9. Ms. Aruna Singh, learned counsel holding brief of Mrs. Archana Singh, learned counsel for the appellant-Insurance Company in FAFO No. 1824 of 2016, contests the quantum of compensation as being excessive awarded by the learned tribunal to the injured who suffers injuries in the said accident. 10. Shri Amit Kumar Sinha, learned counsel for the claimants-respondents refuting the aforesaid submissions and contends that it was not a case of contributory negligence and the entire liability has to be borne by the truck owner/insurance company. The income of the deceased was duly established by oral and documentary evidence, but the learned tribunal failed to consider the same. The compensation is liable to be enhanced. (V) Issues for Consideration: 11. The income of the deceased was duly established by oral and documentary evidence, but the learned tribunal failed to consider the same. The compensation is liable to be enhanced. (V) Issues for Consideration: 11. After advancing their arguments, learned counsels for the respective parties agree that only the following questions fall for consideration in these appeals: (i) Whether the accident resulted from contributory negligence from the part of the driver of the motor vehicle and the Insurance Company was not liable to pay the entire amount? (ii) Whether the learned tribunal while determining the compensation lawfully computed the amounts under these heads: income, future prospects, multiplier, conventional head. (VI) Issue of contributory negligence 12. The claimants introduced PW-2 Ghanshyam Singh an eye witness to prove the accident and negligence of the offending vehicle. PW-2 Ghanshyam Singh testified before the learned trial court that he had witnessed the accident and that the driver of the offending truck drove rashly and negligently collided with the rear side of the motorcycle which the deceased was driving. The deceased succumbed to the injuries sustained in the accident. The testimony of PW-2 was not impeached under cross examination. 13. The vehicle inspection report opines that all parts of the motorcycle were badly damaged. 14. The comprehensive damage to the motorcycle is corroborated by the testimony of PW-2. The deposition of PW- 2 is consistent with the assertions in the claim petition. 15. The learned tribunal which had the advantage of observing the demeanour of the witness found PW-2 to be reliable and believed his testimony. There is nothing in the arguments or the records which persuades this Court to take a different view in the matter. 16. Evidence in the record establishes that sole negligence was that of the offending truck driver. The deceased motorcycle driver was driving prudently. The rash driving and uncontrollable speed of the offending truck gave the motorcycle driver no time or opportunity to take evasive measures to prevent the accident or save himself. The deceased motorcycle cannot be faulted for the accident. This is not a case of contributory negligence. The driver of the offending truck was solely culpable for causing the accident, and the insurance company is fully liable to pay the compensation. 17. A head on collusion does not ipso facto mean that it is a case of contributory negligence. The deceased motorcycle cannot be faulted for the accident. This is not a case of contributory negligence. The driver of the offending truck was solely culpable for causing the accident, and the insurance company is fully liable to pay the compensation. 17. A head on collusion does not ipso facto mean that it is a case of contributory negligence. Contributory negligence occurs when both the parties drive negligently, flout traffic rules, or fail to observe norms of safe driving. Contributory negligence implies that both parties are culpable for the accident. In such cases, the courts have to assess the responsibility of each party in causing the accident, and apportion the liability on the parties accordingly. 18. The learned tribunal found for the claimants and against the insurance company/truck owner of the offending vehicle on the issue of culpability for the accident and liability to pay the compensation. There is no infirmity in the appraisal of evidence and consideration of pleadings material in the record by the learned tribunal. The entire liability to pay the compensation was rightly and lawfully fixed upon the insurance company by the learned tribunal. The findings of the learned tribunal on this issue are affirmed. (VI) Number of dependants and deduction towards expenses 19. The dependants of the deceased in FAFO No. 1925 of 2015 are: S. No. Name Age Relation 1. Ram Sureman 64 Father 2. Smt. Shivpati 62 Mother 3. Smt. Sunita Yadav 27 Wife 4. Krishna Yadav 4 Son 20. Learned counsel for both the parties agree that the appropriate deduction in the facts and circumstances of this case towards personal expenses would be 1/4th of the income of the deceased. (VII) Issue of Income of the deceased: 21. The wife of the deceased entered the witness box as PW-1 and deposed that the deceased earned Rs. 10,000/- per month from a private business and Rs. 5,000/- by selling milk. The issue of income from sale of milk was not pressed before this Court by the claimants as there is no evidence to support the same. The deceased ran a business under the name and style of Army Tent House. Number of receipts from the cash book were introduced as evidence to establish the income of the deceased. The PW-1 proved the receipts of Army Tent House. The deceased ran a business under the name and style of Army Tent House. Number of receipts from the cash book were introduced as evidence to establish the income of the deceased. The PW-1 proved the receipts of Army Tent House. The said receipts were never challenged, nor was PW-1 confronted on the genuineness of the receipts in the witness box. 22. The learned tribunal in the impugned award found that in absence of registration certificate of the said business, the veracity of the aforesaid receipts was doubtful. The learned tribunal opined that the tent house business is not a perennial business but a seasonal one. The learned tribunal categorized the deceased as an unskilled worker and fixed his income @ Rs. 4,000/- per month. 23. The learned tribunal neglected to consider the said receipts of the Army Tent House. The learned tribunal pivoted its findings on failure of the claimants to produce registration certificate of the business. This approach of the learned tribunal vitiate the award. Many business in the country like one of this nature are part of the informal sector of the economy. Such businesses are not very well documented. Lack of formal registration of the business cannot influence determination of the income of the deceased. 24. I am afraid that the learned tribunal was led into error while determining the income of the deceased. 25. The receipts of the Army Tent House recording client orders and payments were duly proved. In the absence of a credible challenge the authenticity of the receipts cannot be called into question. The said receipts depict a business that was of a perennial nature, and that the clientele was a loyal one. Events and celebrations are regular features in the society and are not intermittent fixtures. 26. The tent house business requires high degrees of organisational, logistical marketing skills. The fact that the deceased ran a successful tent business evidences his entrepreneurial skills and managerial expertise. The deceased cannot be classed as an unskilled workman. 27. The exact income of the deceased is not established by the adduced evidence. The enquiry of the court will examine various relevant aspects while assessing the deceased's income. The notified minimum wage is a good start point but not the final figure. 28. The minimum wage of a skilled labour at the relevant time as notified by the State Government was Rs. 6,296/- per month. The enquiry of the court will examine various relevant aspects while assessing the deceased's income. The notified minimum wage is a good start point but not the final figure. 28. The minimum wage of a skilled labour at the relevant time as notified by the State Government was Rs. 6,296/- per month. However, the notified minimum wages would not give a complete picture in the facts of the case. The perennial nature of the business, existence of faithful clients and the entrepreneurial skills of the deceased have to be factored in while determining his income. The testimony of PW-1 to the extent it has been found to be reliable will also guide the Court in evaluating the income of the deceased. 29. In the wake of the preceding discussion, the Court finds that the income of the deceased is fixed @ of Rs. 8,000/- per month. (VIII) Future Prospects 30. The future prospects are liable to be calculated in accordance with the Uttar Pradesh Motor Vehicles Rules, 1998 [hereinafter referred to as the “U.P. Rules, 1998”]. Rule 220A-3(i) of the Rules is relevant and is reproduced hereunder: “(3) The future prospects of a deceased, shall be added in the actual salary or minimum wages of the deceased as under: (i) Below 40 years of age: 50% of the salary.” 31. The UP Rules, 1998 came up for consideration before the Supreme Court in New India Assurance Co. Ltd. vs. Urmila Shukla and Others, 2021 SCC Online SC 822. In Urmila Shukla (supra) upon consideration of various judgments including National Insurance Company Ltd. vs. Pranay Sethi and Others, 2017 (16) SCC 680 held: “10. The discussion on the point in Pranay Sethi was from the standpoint of arriving at “just compensation” in terms of Section 168 of the Motor Vehicles Act, 1988. 11. If an indicia is made available in the form of a statutory instrument which affords a favourable treatment, the decision in Pranay Sethi cannot be taken to have limited the operation of such statutory provision specially when the validity of the Rules was not put under any challenge. The prescription of 15% in cases where the deceased was in the age bracket of 50-60 years as stated in Pranay Sethi cannot be taken as maxima. In the absence of any governing principle available in the statutory regime, it was only in the form of an indication. The prescription of 15% in cases where the deceased was in the age bracket of 50-60 years as stated in Pranay Sethi cannot be taken as maxima. In the absence of any governing principle available in the statutory regime, it was only in the form of an indication. If a statutory instrument has devised a formula which affords better or greater benefit, such statutory instrument must be allowed to operate unless the statutory instrument is otherwise found to be invalid.” (Emphasis supplied) 32. The Rules of the Uttar Pradesh Motor Vehicles Rules, 1998 were not under consideration before the Supreme Court in Pranay Sethi (supra) or Smt. Sarla Verma and Others vs. Delhi Transport Company and Another, 2009 (6) SCC 121 . Future prospects in Pranay Sethi (supra) were determined without noticing the U.P. Rules, 1998. This fact was adverted to in Urmila Shukla (supra): “8. It is submitted by Mr. Rao that the judgment in Pranay Sethi does not show that the attention of the Court was invited to the specific rules such as Rule 3(iii) which contemplates addition of 20% of the salary as against 15% which was stated as a measure in Pranay Sethi. In his submission, since the statutory instrument has been put in place which affords more advantageous treatment, the decision in Pranay Sethi ought not to be considered to limit the application of such statutory Rule.” 33. The U.P. Rules, 1998 are statutory in nature and their operation is not stymied by Pranay Sethi (supra). The U.P. Rules, 1998 have the force of law and shall apply with full force in appropriate cases. The U.P. Rules, 1998 are more beneficial for the claimants than the provisions made in Pranay Sethi (supra) for them. The holdings in Pranay Sethi (supra) can not dilute the advantages conferred by U.P. Rules, 1998 upon the eligible beneficiaries. 34. The preceding legal backdrops entitles the claimants-appellants to 50% enhancement in wages towards future prospects, consistent with the U.P. Rules, 1998. The necessary changes in the award shall be accordingly made. (IX) Multiplier: 35. The age of the deceased was 28 years at the time of his death. Multiplier of 17 has been correctly applied by the learned tribunal and is in line with Pranay Sethi (supra) and Sarla Verma (supra). (X) Calculation of Conventional Heads: 36. The necessary changes in the award shall be accordingly made. (IX) Multiplier: 35. The age of the deceased was 28 years at the time of his death. Multiplier of 17 has been correctly applied by the learned tribunal and is in line with Pranay Sethi (supra) and Sarla Verma (supra). (X) Calculation of Conventional Heads: 36. The amount determined under conventional heads in the impugned award is at variance with Pranay Sethi (supra). The conventional heads were fixed in Pranay Sethi (supra) by holding as under: “54.........The conventional and traditional heads, needless to say, cannot be determined on percentage basis because that would not be an acceptable criterion. Unlike determination of income, the said heads have to be quantified. Any quantification must have a reasonable foundation. There can be no dispute over the fact that price index, fall in bank interest, escalation of rates in many a field have to be noticed. The court cannot remain oblivious to the same. There has been a thumb rule in this aspect. Otherwise, there will be extreme difficulty in determination of the same and unless the thumb rule is applied, there will be immense variation lacking any kind of consistency as a consequence of which, the orders passed by the tribunals and courts are likely to be unguided. Therefore, we think it seemly to fix reasonable sums. It seems to us that reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs. 15,000/- and Rs. 40,000/- funeral expenses should be Rs. 15,000/- and Rs. 40,000/- And Rs. 15,000/- respectively.” 37. The figure under conventional heads determined in Pranay Sethi (supra) shall be applicable to the facts of this case. The award is modified accordingly. (XII) Interest 38. Interest of 7% and the manner of payment decided by the learned tribunal is just and lawful and does not call for interference. (XII) Determination of Compensation to which claimants are entitled: 39. In wake of the preceding discussion, the amount of compensation to which the claimants are entitled and are hereby awarded is tabulated hereunder: (i) Date of Accident 12.06.2013 (ii) Name of Deceased Charan Singh (iii) Age of the deceased 28 years (iv) Occupation of the Deceased Proprietor Tent House (v) Income of the deceased 8,000/- per month (vi) Name, Age and Relationship of Claimants with the deceased: S. No. Name Age Relation 1. Ram Sureman 64 Father 2. Smt. Shivpati 62 Mother 3. Smt. Sunita Yadav 27 Wife 4. Krishna Yadav 4 Son (vii) Computation of Compensation: S. No. Heads Amount (in Rupees) 1. Monthly Income (A) Rs. 8,000/- 2. Annual Income (B) (Ax12 = B) Rs. 96,000/- 3. Future Prospects (C) 50% of 96,000/- = 48,000/- 4. Annual Income + Future Prospects (B+C=D) 96,000+ 48,000/- = 1,44,000/- 5. Deduction towards personal expenses (E) (1/4 of D) 1/4 of 1,44,000/- = 36,000 6. Annual Loss of dependancy (F) (D-E = F) 1,44,000-36000 = 1,08,000/- 7. Multiplier (G) 17 8. Total loss of dependancy (FxG) 1,08,000/- x 17 = 18,36,000/- 9. Conventional Heads: (a) Loss of consortium 70,000/- (b) Loss of Estate (c) Funeral Expenses 10. Total compensation 18,36,000 + 70,000 = 19,06,000/- 11. Interest 7% FAFO No. 1824 of 2016 (M/s The New India Assurance Co. Ltd. vs. Ghanshyam Singh Yadav and Others) 40. The FAFO No. 1824 of 2016 arises from the compensation paid to the injured in the accident. The injured has been awarded a compensation of Rs. 1,26,925/- towards medical expenses. A break up of the compensation is as under: 1. Medical expenses Rs. 1,09,925/- 2. Special diet and Nourishment Rs. 6,000/- 3. Grievous injuries Rs. 5,000/- 4. Loss of income Rs. 6,000/- 41. In the aforesaid case, the learned tribunal found that the testimony of the driver was inconsistent with the pleadings taken by the insurance company and the truck owner in the written statement. The learned Tribunal found that the injured had sustained grievous injuries in the accident which led to temporary unemployment. The injury did not suffer any permanent disability. The Tribunal has awarded the compensation under various heads including medical expenses, grievous injuries, loss of income, as seen above. The figures are re-decided in view of the aforesaid findings. The medical evidences are corroborated by the records and hence need no alteration. However the deceased shall be entitled to the following amounts under various heads: S. No. Heads Entitled amount (in Rupees) 1. Special diet and nourishment 20,000/- 2. Loss of income 30,000/- 3. Grievous injuries 20,000/- 4. Interest 7% The award dated 17.03.2016 which is the subject matter of FAFO No. 1824 of 2016 is modified accordingly. (XIII) Conclusion and Directions: 42. In view of the above, the appeal filed by the Insurance Company viz. First Appeal From Order No. 1824 of 2016 is dismissed. Loss of income 30,000/- 3. Grievous injuries 20,000/- 4. Interest 7% The award dated 17.03.2016 which is the subject matter of FAFO No. 1824 of 2016 is modified accordingly. (XIII) Conclusion and Directions: 42. In view of the above, the appeal filed by the Insurance Company viz. First Appeal From Order No. 1824 of 2016 is dismissed. 43. The appeal filed by Insurance Company and the claimants viz. First Appeal From Order No. 1327 of 2015 and First Appeal From Order No. 1925 of 2015 are partly allowed to the extent set out in the judgment. 44. The amount of compensation which the claimants have been awarded shall be deposited by the Insurance Company within a period of three months before the learned tribunal. Thereafter the learned tribunal shall release the amount to the claimants without delay. The amount already disbursed to the claimants (if any) shall be adjusted. 45. The amount deposited by the Insurance Company before this Court shall be transmitted to the learned tribunal which shall release the same in favour of the claimants as part of the compensation determined in this appeal.