Partly allowed

Smt.Raheela Khan and Others v. Shah.Naushad Ahmad and Others

Allahabad HC15 Dec 2021FAFO/2511/2010

Case brief

AI extract

What is this about?

The single judge allowed the appeal in part, modifying the compensation awarded by the Motor Accident Claims Tribunal. The court added agricultural income, increased non-pecuniary damages including loss of consortium, and standardized the interest rate to 7.5% based on recent Supreme Court rulings, recalculating the total award to Rs. 18,59,290/-.

What did the court decide?

The judgment and order of the Tribunal are modified; the Tribunal is directed to draw a fresh schedule of compensation amounting to Rs. 18,59,290/- with interest at 7.5% p.a.

Smt.Raheela Khan and Others Vs Shah.Naushad Ahmad… — Motor Accident Claims | Allahabad HC (2021)

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Court No. - 21

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Case :- FIRST APPEAL FROM ORDER No. - 2511 of 2010

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Appellant :- Smt.Raheela Khan And Others Respondent :- Shah.Naushad Ahmad And Others Counsel for Appellant :- Ram Singh

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Hon'ble Dr. Kaushal Jayendra Thaker,J. Hon'ble Ajai Tyagi,J.

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(Oral Judgment by Hon’ble Ajai Tyagi, J.)

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1. By way of this appeal, the claimants have challenged the judgment and order dated 17.04.2010 passed by Motor Accident Claims Tribunal/Additional District Judge, Court No.7, Aligarh (hereinafter referred to as ‘Tribunal’) in M.A.C.P. No.288 of 2009, awarding sum of Rs.13,12,971/- as compensation to the claimants with interest at the rate of 6% per annum.

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2. Heard Mr. Ram Singh, learned counsel for the appellants and Mr. Pawan Kumar, learned counsel for the respondents. Perused the record.

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3. The accident is not in dispute. The IFFCO Tokio General Insurance Co. Ltd. (hereinafter referred to as “Insurance Company”) has not challenged the liability on it.

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4. Brief facts of the case are that claimants-appellants filed Motor Accident Claim Petition before the Tribunal on account of death of Syed Mujahid Hussain-deceased in a road accident with the averments that on 02.03.2009 at about 1:30 AM (night) Syed Mujahid Hussaindeceased was coming to his house after attaining the marriage ceremony on his scooter bearing No. U.P. 81 L 8901. When he reached at Nandan Abhinandan Banquet Hall near Gudiya Baag, a truck bearing No.U.P. 81 W 9080 came at a very high speed, which

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was driven very rashly and negligently by its driver and collided with the scooter of the deceased.

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5. In this accident, deceased sustained fatal injuries and died on the spot. The age of the deceased was 47 years. He was self employed but was appointed in Saudi Arabia on the salary of Rs.9,000/- Riyal per month and he had to go on 18.03.2009 to Saudi Arabia i.e. after 15 days of the fateful night.

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6. Learned counsel for the appellants has submitted that at the time of accident, the deceased was running his own factories in Aligarh and he was self employed person but he had appointed in Saudi Arabia at Rs.9,000/- Riyal per month on contractual basis. He had to go to join in Saudi Arabia after 15 days of the accident. Earlier also the deceased has served in Saudi Arabia. It is next submitted that income tax return of the deceased was filed before the Tribunal on the basis of which learned Tribunal assessed the annual income of the deceased at Rs.1,50,400/- per annum after deduction of income tax.

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7. Learned counsel for the appellant very empathetically submitted that the deceased was having agricultural income also to the tune of Rs.60,000/- per annum. This agriculture income was reflected in income tax return also but the Tribunal did not consider it, which is against the law. In this submission, learned counsel for the appellants relied upon the latest judgment of the Apex Court in Geeta and Others Vs. Manager, Bajaj Allianz Insurance Co. Ltd., 2021 (4) TAC 19 (SC). It is also submitted by learned counsel for the appellant that learned Tribunal has not given compensation under the head of future prospects. The age of the deceased was 47 years, hence in the light of the judgment of the Apex Court in Sarla Verma and Others Vs. Delhi Transport Corporation and Another, 2009 LawSuit (SC) 613 and National Insurance Co. Ltd. Vs. Pranay Sethi and Others,

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2017 LawSuit (SC) 1093, due to being self employed and ageof 47 years, 25% shall be added towards future prospects to the income of the deceased as per the aforesaid decision.

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8. Per contra, learned counsel for the Insurance Company vehemently objected the submissions made by the counsel for the appellants and submitted that learned Tribunal has rightly refused the addition of agricultural income with the income from the business. Learned counsel for the Insurance Company has relied on the judgment of this Court in the case of Smt. Heema Gill @ Hema Gill and Another Vs. Ashish Kumar And 3 Others passed in F.A.F.O. No.4130 of 2017.

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9. We threadbare, analyzed the reasoning given by the learned Tribunal in assessment of income of the deceased. As per the income tax return of the deceased, his income from profession was made the basis of calculating the income by the Tribunal. It was held that his annual income was Rs.1,50,400/- after deduction of income tax. Tribunal altogether ignored the income from agriculture as no addition of agriculture income is made to the income by profession.

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10. The concept of “just compensation” was discussed by this Court in National Insurance Company Limited Vs. Lavkush and another, 2018 (1) T.A.C. 431, whereby it is held that when application is filed under Section 166 of Motor Vehicles Act, 1988, the Tribunal is under a statutory obligation to determine “just” amount of compensation. It is further held that Section 168 contemplates determination of "just compensation". 'Just' means, fair, reasonable and equitable amount accepted by legal standards. "Just compensation" does not mean perfect or absolute compensation. "Just compensation" principle requires examination of particular situation obtaining uniquely in an individual case.

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11. When compensation is to be determined on an application under Section 166, various heads under which damages are to be assessed, have to be looked into by Tribunal and not by merely determining income and applying multiplier.

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12. In K. Suresh v. New India Assurance Company Ltd. and Ors.8, Hon'ble the Apex Court has held as follows :

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"2...There cannot be actual compensation for anguish of the heart or for mental tribulations. The quintessentiality lies in the pragmatic computation of the loss sustained which has to be in the realm of realistic approximation. Therefore, Section 168 of the Motor Vehicles Act, 1988 (for brevity the Act) stipulates that there should be grant of just compensation. Thus, it becomes a challenge for a court of law to determine just compensation which is neither a bonanza nor a windfall, and simultaneously, should not be a pittance."

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13. The learned counsel for the Insurance Company has relied on the judgment of Smt. Heema Gill @ Hema Gill and Another (Supra) but in the light of the latest judgment of Hon’ble Apex Court in the case of Geeta and others (Supra) , concept of Heema Gill @ Hema Gill and another (Supra) is not to be applied but the judgment of Geeta and others (Supra) is to be applied on the facts of this case, whereby it is held that non addition of additional income of the deceased cannot be justified. Hence, in the light of the above judgment, we are of the considered view that Rs.12,000/- per annum be added in the income of the deceased by profession as the component of agriculture income, hence, we fix total annual income of the deceased as Rs.1,50,400 + 12,000/- = Rs.1,62,400/-.

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14. Learned Tribunal has not awarded any sum towards future loss of income. According to the judgment of Hon’ble Apex Court in Pranay Sethi and Others, (Supra), a certain percentage of income is

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to be added towards future prospects. Since the deceased was self employed and 47 years of age, as per the aforesaid judgment, 25% of the total income of the deceased will be added towards future prospects. There are three dependents of the deceased, hence, 1/3rd of the income will be deducted for personal expenses of the deceased as held by Hon’ble Apex Court in Sarla Verma and Others (Supra), since the deceased falls in the age of 45-50, the multiplier of 13 will be applied.

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15. As far as non pecuniary damages are concerned, the Tribunal has awarded only Rs.5,000/- for loss of consortium, Rs.2,500/- for loss of estate and Rs.2,000/- for funeral expenses, which are not in consonance of the judgment of Pranay Sethi and Others, (Supra), hence, in the light of the aforesaid judgment, appellants shall be entitled to Rs.15,000/- for loss of estate, Rs.15,000/- for funeral expenses. Apart from it, wife of the deceased shall also be entitled to get Rs.40,000/- for loss of consortium. The claimants shall be entitled Rs.70,000/- under the head of non pecuniary damages with increase of 10% every three years as per the judgment of Apex Court in Pranay Sethi (Supra) .

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16. Hence, the total compensation payable to the appellants in view of the decisions of the Apex Court in Sarla Verma and Others (Supra) and Pranay Sethi (Supra) computed herein below:

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(i) Annual income Rs.1,50,400 + 12,000/- = Rs.1,62,400/-per annum

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(ii) Percentage towards future prospect : 25% = Rs.40,600/-

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(iii) Total income : Rs.1,62,400 + Rs.40,600 = Rs.2,03,000/-

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(iv) Income after deduction of 1/3rd : Rs.2,03,000 – 67,670 = Rs.1,35,330/-

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(v) Multiplier applicable : 13 :- Rs. 1,35,330 X 13 = Rs.17,59,290/-

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(vi) Amount under non pecuniary head:Rs.70,000/-+30,000 = Rs.1,00,000/-

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(vii) Total compensation : Rs.17,59,290 + Rs.1,00,000/- = Rs.18,59,290/-

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17. As far as issue of rate of interest is concerned, it should be 7.5% in view of the latest decision of the Apex Court in National Insurance Co. Ltd. Vs. Mannat Johal and Others, 2019 (2) T.A.C. 705 (S.C.) wherein the Apex Court has held as under:

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"13. The aforesaid features equally apply to the contentions urged on behalf of the claimants as regards the rate of interest. The Tribunal had awarded interest at the rate of 12% p.a. but the same had been too high a rate in comparison to what is ordinarily envisaged in these matters. The High Court, after making a substantial enhancement in the award amount, modified the interest component at a reasonable rate of 7.5% p.a. and we find no reason to allow the interest in this matter at any rate higher than that allowed by High Court."

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18. Learned Tribunal has awarded rate of interest as 7% per annum but we are fixing the rate of interest as 7.5% in the light of the above judgment.

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19. In view of the above, the appeal is partly allowed. Judgment and award passed by the Tribunal shall stand modified to the aforesaid extent. The respondent-Insurance Company Ltd. (Insurance Company) shall deposit the amount within a period of 12 weeks from today with interest at the rate of 7.5% from the date of filing of the claim petition till the amount is deposited. The amount already deposited be deducted from the amount to be deposited. Statutory amount be remitted to the Tribunal.

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20. In view of the ratio laid down by Hon'ble Gujarat High Court, in the case of Smt. Hansagori P. Ladhani v/s The Oriental Insurance Company Ltd., reported in 2007(2) GLH 291 and this High Court in total amount of interest, accrued on the principal amount of compensation is to be apportioned on financial year to financial year basis and if the interest payable to claimant for any financial year

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exceeds Rs.50,000/-, insurance company/owner is/are entitled to deduct appropriate amount under the head of 'Tax Deducted at Source' as provided u/s 194A (3) (ix) of the Income Tax Act, 1961 and if the amount of interest does not exceeds Rs.50,000/- in any financial year, registry of this Tribunal is directed to allow the claimants to withdraw the amount without producing the certificate from the concerned Income- Tax Authority. The aforesaid view has been reiterated by this High Court in Review Application No.1 of 2020 in First Appeal From Order No.23 of 2001 (Smt. Sudesna and others Vs. Hari Singh and another) and in First Appeal From Order No.2871 of 2016 (Tej Kumari Sharma v. Chola Mandlam M.S. General Insurance Co. Ltd.) decided on 19.3.2021 while disbursing the amount.

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Order Date :- 15.12.2021 P.S.Parihar

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(Hon'ble Ajai Tyagi, J.) (Dr. Kaushal Jayendra Thaker, J.)

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Smt.Raheela Khan and Others v. Shah.Naushad Ahmad and Others

Case brief

What is this about?

What did the court decide?

Smt.Raheela Khan and Others v. Shah.Naushad Ahmad and Others

Case brief

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