Partly allowed

Smt. Vimla Sharma v. Krishna Kumar and Another

Allahabad HC29 Sept 2021FAFO/649/2017

Case brief

AI extract

What is this about?

This appeal challenges the low compensation awarded by the Motor Accident Claims Tribunal for the death of a 27-year-old teacher. The High Court directed an increase in compensation by adding 50% for future loss of income, setting the multiplier at 17 based on the deceased's age, and awarding Rs. 30,000 for non-pecuniary damages.

What did the court decide?

Tribunal order modified; total compensation enhanced to Rs. 23,25,000; interest fixed at 7.5% per annum.

Smt. Vimla Sharma Vs Krishna Kumar and Another — Motor Accident Claims | Allahabad HC (2021)

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AFR

Court No. - 37

Case :- FIRST APPEAL FROM ORDER No. - 649 of 2017 Appellant :- Smt. Vimla Sharma Respondent :- Krishna Kumar And Another Counsel for Appellant :- Ram Singh,Amit Kumar Singh Counsel for Respondent :- Rajkapoor Upadhyay

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Hon'ble Dr. Kaushal Jayendra Thaker,J. Hon'ble Subhash Chand,J.

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Heard learned counsel for the parties and perused the judgment and order impugned.

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By way of this appeal, the claimants have challenged the judgment and order dated 26.11.2016 passed by Motor Accident Claims Tribunal/Additional District Judge, Court No.7, Aligarh (hereinafter referred to as 'Tribunal') in M.A.C.P. No. 02 of 2015 awarding sum of Rs.10,00,000/- as compensation to the claimants with interest at the rate of 7%.

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The accident is not in dispute. The Insurance Company has not challenged the liability imposed on them. Hence, the only issue to be decided is, the quantum of compensation awarded. The details of facts except for deciding compensation are not narrated.

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It is submitted that deceased-Pawan Sharma who was a teacher by profession left behind him his mother. He was 27 years of age on the date of accident namely on 12.12.2014. Learned counsel for the appellant does not dispute the decision of the Tribunal on the basis that the income was Rs.15,000/- per month but, disputes that despite the judgment of the Apex Court in Sarla Verma and others Vs. Delhi Transport Corporation and Another, 2009 LawSuit (SC) 613 & National Insurance Company Limited Vs. Pranay Sethi and Others, 2017 0 Supreme (SC) 1050, no future loss of income has been considered by the Tribunal though the deceased was serving in Shanti Niketan World School, P.A.C. Ramghat Road Aligarh as

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teacher (P.T.I. Post). It is submitted by learned counsel for the appellant that the Tribunal has not assigned any reason for non granting the future loss of income. The next contention is that the Tribunal has granted multiplier of 12 considering the age of mother and granted and has granted only Rs.10,000/- under the head of non pecuniary damages which is bad. Learned counsel for the appellant contend that the multiplier should be considered on the basis of the age of the deceased and it should be 17. It is further submitted that the amount under the head of non-pecuniary damages should be as per the decision of the Apex Court in Pranay Sethi (Supra). It is also submitted by learned counsel for the appellant that the interest awarded by the Tribunal is on the lower side and is required to be enhanced.

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Sri Radhey Shyam, learned Advocate appearing for Sri N.K. Srivastava, learned counsel for the respondent-Insurance Company has submitted that the award is of the year 2016, the Tribunal has considered the 2nd Schedule of Uttar Pradesh Motor Vehicles Rules and has considered the age of the mother for grant of compensation, hence, the award passed by the Tribunal cannot be found fault with.

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The submission is that the Tribunal has not granted any amount towards future loss of income which has to be considered and grant of future prospects will have to be traced back and reference can be had to the decision in General Manager, Kerala S.R.T.C., Trivandrum v. Susamma Thomas & Ors.,(1994) 2 SCC 176 wherein addition of future prospects was also calculated. The decision in Susamma Thomas (Supra) was referred in U.P.S.R.T.C. & Ors. v. Trilok Chandra & Ors.(1996) 4 SCC 362 which have been considered by the Apex Court in Sarla Dixit Versus Balwant Yadav AIR 1996 SC 1274 and the Apex Court has considered decision in Hardeo Kaur V/s. Rajasthan State Transport Corporation, 1992 2 SCC 567. The

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decision in Sarla Dixit has been considered to be good law in (1) Puttamma Vs. K.L.Narayana Reddy, AIR 2014 SC 706 (2) Raman Vs. Uttar Haryana Bijli Vitran Nigam Limited, Bijoy Kumar Dugar Vs. Bidyadhar Dutta, 2006 (3) SCC 242 : (3) Sarla Verma (supra)(4)R.K.Malik Vs. Kiran Pal, AIR 2009 SC 2506 (5)National Insurance Company Limited Vs. Pranay Sethi, AIR 2017 SC 5157 Raj Rani Vs. Oriental Insurance Company Limited, 2009 (13) SCC 654. We have gone through the decisions in those days referred to herein above and the judgment of Gujarat high court in Ritaben alias Vanitaben Wd/o. Dipakbhai Hariram and Anr. v/s.Ahmedabad Municipal Transport Service & Anr., 1998 (2) G.L.H. 670 , wherein, the Court has observed as under:

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"para-7: It is settled proposition of that the main anxiety of the Tribunal in such case should be to see that the heirs and legal representatives of the deceased are placed, as far as possible, in the same financial position, as they would have been, had there been no accident. It is therefore, an action based on the doctrine of compensation.

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para-8: It may also be mentioned that perfect determination of compensation in such tortuous liability is, hardly, obtainable. However, the Tribunal is required to take an overall view of the facts and the relevant circumstances together with the relevant proposition of law and is obliged to award an amount of compensation which is just and reasonable in the circumstances of the case.

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para-10: Even in absence of any other evidence an able bodied young man of 25 years, otherwise also presumed to earn an amount of Rs.1000/- or more per month, on that basis the prospective income could be calculated by doubling the one prevalent on the date of the accident, which is required be divided by half, so as to reach the correct datum figure which is required to be multiplied by appropriate multiplier. Even taking a conservative view in the matter, the deceased would be earning not less than an amount of Rs.1000/- per month and considering the prospective average income of Rs.2000/and divided by half, would, obviously come to Rs.1500/."

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Thus even in year of accident, the addition of future prospects was not ruled out, just because tribunals in Uttar Pradesh were not

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granting future loss, it cannot hold field where the decision of Apex Court is otherwise. The decision of the Apex Court in New India Assurance Company Ltd. Vs. Urmila Shukla and others, LL 2021 SC 359 will have to be looked into. Therefore, we will have to consider the same in the light of the recent decisions as well as the decisions of the Apex Court prevailing.

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Even in the earlier days, the factors to be considered for issuing quantum of compensation reads as follows:

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i. To give present value, a reasonable deduction or reduction is required as lump sum amount is given at a stretch under the head of prospective economic loss;

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ii. The tax element is also required to be considered as observed in the Gourley's case (1956 AC 185).

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iii. The resultant impairment/death on the earning capacity of the claimant/claimants .

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iv. That the amount of interest is awarded also on the prospective loss of income.

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v. That the amount of compensation is not exemplary or punitive but is compensatory.

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While perusing the judgement, it is very clear that the Tribunal has not considered the judgment of the Apex Court in Sarla Verma (Supra) nor has it considered the earlier judgments which were focusing on future loss of income to be paid. We grant 50% addition towards future loss of income as the deceased was below the age of 40 years and was in regular service. As far as multiplier is concerned, it should be considered on the basis of the age of the deceased. We are fortified in our view by the decisions of the Apex Court in Munna Lal Jain & Anr. Vs. Vipin Kumar Sharma & Ors. 2015 (6) SCALE 552 wherein it has been held that multiplier should be on the basis of the age of the deceased and also the decision in Sarla Verma (Supra) and, therefore, we grant multiplier of 17 as the deceased was in the age bracket of 26-30. As far as amount under the head of non-

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pecuniary damages are concerned, we grant Rs.30,000/- to the mother towards filial consortium.

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Hence, the total compensation payable to the appellant is computed herein below:

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i. Income Rs.15,000/- per month

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ii. Percentage towards future prospects : 50% namely Rs.7500/-

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iii. Total income : Rs. 15,000 + 7500 = Rs.22,500/-

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iv. Income after deduction of 1/2 : Rs.11,250/-

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v. Annual income : Rs.11,250 x 12 = Rs.1,35,000/-

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vi. Multiplier applicable : 17

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vii. Loss of dependency: Rs.1,35,000 x 17 = Rs.22,95,000/-

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viii. Amount under non pecuniary damages : Rs.30,000/-

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xi. Total compensation : 23,25,000/-

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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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No other grounds are urged orally when the matter was heard.

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In view of the above, the appeal is partly allowed. Judgment and decree passed by the Tribunal shall stand modified to the aforesaid extent. The respondent-Insurance Company shall deposit the amount within a period of 12 weeks from today with interest at the

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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.

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On depositing the amount in the Registry of Tribunal, Registry is directed to first deduct the amount of deficit court fees, if any. Considering the ratio laid down by the Hon'ble Apex Court in the case of A.V. Padma V/s. Venugopal, Reported in 2012 (1) GLH (SC), 442 , the order of investment is not passed because applicants /claimants are neither illiterate or rustic villagers.

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In view of the ratio laid down by Hon'ble Gujarat High Court, in the case of Smt. Hansaguti P. Ladhani v/s The Oriental Insurance Company Ltd., reported in 2007(2) GLH 291 , 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 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 claimant 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) while disbursing the amount.

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Fresh Award be drawn accordingly in the above petition by the tribunal as per the modification made herein. The Tribunals in the State shall follow the direction of this Court as herein aforementioned as far as disbursement is concerned, it should look into the condition

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of the litigant and the pendency of the matter and apply the judgment of A.V. Padma (supra) . The same is to be applied looking to the facts of each case.

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Record and proceedings be sent to the Tribunal. A copy of this order be circulated to the learned Judge, Sri Ajay Kumar Tripathi where he is serving so that he may remain more vigilant in future while considering the judgment of the Apex Court. The judgment in Sarla Verma (supra) also held that where a person is salaried, future loss of income should be granted. The Uttar Pradesh Motor Vehicles Rules also stipulates the same.

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Order Date :- 29.9.2021 DKS

Smt. Vimla Sharma v. Krishna Kumar and Another

Case brief

What is this about?

What did the court decide?

Smt. Vimla Sharma v. Krishna Kumar and Another

Case brief

What is this about?

What did the court decide?

What the court decided

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Issues for consideration

Cases cited

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