Partly allowed

Mohammad Siddique and Another v. U.P.State Road Transport Corporation

Allahabad HC17 May 2022FAFO/3772/2007

Case brief

AI extract

What is this about?

The court modified a Motor Accident Claims Tribunal award, enhancing the victim's estimated income by 40% for future prospects. It awarded additional compensation, adjusted interest to 7.5%, and provided guidelines on tax apportionment and interest withdrawal conditions based on litigant status.

What did the court decide?

The Tribunal award was modified to Rs. 5,03,600; interest rate fixed at 7.5%; respondent to deposit the difference within 12 weeks.

Mohammad Siddique and Another Vs U.P.State Road… — Motor Accident Claims | Allahabad HC (2022)

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Court No. - 2

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Case :- FIRST APPEAL FROM ORDER No. - 3772 of 2007 Appellant :- Mohammad Siddique And Another Respondent :- U.P.State Road Transport Corporation Counsel for Appellant :- Ram Singh Counsel for Respondent :- Mukesh Kumar Singh,Rajesh Kumar Singh

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

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Heard Ram Singh, learned counsel for the appellants, Sri Mukesh Kumar Singh, learned counsel for the respondent and perused the judgment and order impugned.

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This appeal, at the behest of the claimants, challenges the judgment and award dated 18.7.2007 passed by Motor Accident Claims Tribunal/Additional District Judge, Court No.15, Allahabad (hereinafter referred to as 'Tribunal') in M.A.C.No.53 of 2003 awarding a sum of Rs.1,03,500/- with interest at the rate of 6% as compensation.

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The accident is not in dispute. The issue of negligence decided by the Tribunal is not in dispute. The vehicle insured with the respondent - insurance company is not in dispute. The respondent has not challenged the liability imposed on them. The only issue to be decided by this Court is, the quantum of compensation awarded.

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It is submitted by learned counsel for the appellant that the compensation awarded by the Tribunal is on the lower side as he was student and helping in transport business of his father. Learned counsel further submits that the deceased was 18 years of age at the time of accident in the year 2003. His income was considered by the Tribunal to be Rs.15,000/- per annum which according to the counsel for the appellant is on the lower side and should be considered at least Rs.3,000/per month. It is further submitted that the Tribunal has not granted any amount towards future loss of income of the deceased which should be granted in view of the decision in National Insurance Company Limited Vs. Pranay Sethi and Others, 2017 0 Supreme (SC) 1050 . It is further submitted that the amount granted under non-pecuniary damages are on the lower side and it should be as per the decision in Pranay Sethi (Supra) .

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As against this, learned counsel for the respondent has submitted that the award does not require any interference as the date of accident is 14.1.2003 and the decision of the Tribunal is prior to the judgment of National Insurance Company Limited Vs. Pranay Sethi and Others, 2017 0 Supreme (SC) 1050 and therefore the Tribunal has not committed any error in not granting the future loss of income.

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Heard the learned counsels for the parties and considered the factual data. This Court finds that the accident occurred on 14.1.2003 causing death of Mohd. Ibrahim who was 18 years of age at the time of accident. The Tribunal has assessed his income to be Rs.15,000/- per annum which according to this Court, in the year of accident, would be at least Rs.3,000/- per month as he was a student and helping in transport business of his father. To which as the deceased was in the age bracket of 15-20, 40% of the income will have to be added as he was a student and helping in transport business of his father in view of the decision of the Apex Court in Pranay Sethi (Supra). Looking to the general trend even in Gobald Motor Service Ltd. and another Vs. R.M.K Veluswami and other, 1962 SCR(1) 929 , the addition of 40% can be granted

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The total compensation payable is recalculated and is computed herein below:

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i. Annual Income Rs.36,000/- ( Rs.3,000/- per month)

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ii. Percentage towards future prospects : 40% namely Rs.14,400/-

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iii. Total income : Rs.36,000 + Rs.14,400/- = Rs.50,400/-

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iv. Income after deduction of 1/2 half towards personal expenses : Rs.25,200/-

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v. Multiplier applicable : 18

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vi. Loss of dependency: Rs.25,200/- x 18 = Rs.4,53,600/-

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vii. Amount under non pecuniary heads : Rs.50,000/-

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viii. Total compensation : Rs.5,03,600/-

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As far as issue of rate of interest is concerned, the interest 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. Award and

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decree passed by the Tribunal shall stand modified to the aforesaid extent. The respondent- UPSRTC shall deposit the difference of 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.

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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. Hansagauri 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 of the litigant and the pendency of the matter and not blindly 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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The Tribunal shall follow the guidelines issued by the Apex Court in Bajaj Allianz General Insurance Company Private Ltd. v. Union of India and others vide order dated 27.1.2022, as the purpose of keeping compensation is to safeguard the interest of the claimants. As 34 years have elapsed, the amount be deposited in the Saving Account of claimants in Nationalized Bank without F.D.R.

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This Court is thankful to both the counsels for getting this matter decided.

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Order Date :- 17.5.2022/Mukesh

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Digitally signed by MUKESH SRIVASTAVA Date: 2022.05.23 17:48:35 IST Reason: Location: High Court of Judicature at Allahabad

Mohammad Siddique and Another v. U.P.State Road Transport Corporation

Case brief

What is this about?

What did the court decide?

Mohammad Siddique and Another v. U.P.State Road Transport Corporation

Case brief

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What did the court decide?

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