Partly allowed

Pooja Shukla and 3 Others v. Vijay Kumar Tiwari and 2 Others

Allahabad HC14 Feb 2023FAFO/17/2019

Case brief

AI extract

What is this about?

In this appeal against a Motor Accident Claims Tribunal award, the Allahabad High Court enhanced compensation for a deceased small entrepreneur. The Court held that income tax returns reflected true income contrary to the Tribunal's finding, and statutory Uttar Pradesh Rules on future prospects superseded Supreme Court general guidelines. Conventional heads were adjusted per Pranay Sethi standards

What did the court decide?

Compensation enhanced to Rs. 38,15,678/- plus 7% interest; award modified and deposited within three months.

Pooja Shukla and 3 Others Vs Vijay Kumar Tiwari and… — Motor Accident Claims | Allahabad HC (2023)

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Court No. - 74

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Case :- FIRST APPEAL FROM ORDER No. - 17 of 2019

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Appellant :- Pooja Shukla And 3 Others Respondent :- Vijay Kumar Tiwari And 2 Others Counsel for Appellant :- Prakhar Tandon Counsel for Respondent :- Anubhav Sinha Hon'ble Ajay Bhanot,J.

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I. INTRODUCTION

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1. The instant appeal arises out of an award made by the learned Motor Accident Claims Tribunal/Additional District Judge, Kanpur¹ dated 13.09.2018 in Motor Accident Claim Petition No. 994 of 2013 (Smt. Pooja Shukla and others Vs. Vinay Kumar Tiwari and others) by partly allowing the claim of the claimants.

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II. Case of the claimants and respondents before the learned tribunal:

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2. Briefly the case of the claimants before the learned tribunal was that the deceased died of injuries sustained in an accident which occurred on 14.08.2013, and was caused by the rash and negligent driving of the driver of JSA Loader bearing Registration No. UP 78 CN 7323. The offending vehicle was insured by the respondent no. 2-United India Insurance Company Ltd. The claimants are the dependants on the deceased Amit Shukla. The deceased was running a unit which manufactures snacks. The deceased was 30 years of age at the time of his death.

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III . Compensation awarded by the learned tribunal:

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3. The learned tribunal in the impugned judgement dated 13.09.2018 awarded compensation which is depicted in the tabulated form hereunder:

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1 hereinafter referred to as the “learned tribunal”

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Sr.No.	^Heads	Amount Awarded by the tribunal
1.	Monthly Income	3000
2.	Annual Income	36,000/-
3.	Future prospects	25% of 36000= 9,000/-
4.	Annual Income + Future Prospects	36000+9000=45000/-
5.	Deduction towards personal expenses	1/3 of 45000 =15000/-
6.	Annual loss of dependancy	45000-15000=30000/-
7.	Multiplier	17
8.	Total loss of dependancy	30,000x17= 5,10,000/-
9.	Conventional Heads (a) Loss of consortium (b) loss of Estate (c) Funeral Expenses	55,000
10.	Total compensation	5,10,000+55000 = 5,65,000/-
11.	Interest	7%

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4 . The claimants seek enhancement of compensation by means of the instant appeal.

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IV. Arguments of learned counsels:

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5. Shri Prakhar Tandon, learned counsel for the appellants assails the order by contending that the learned tribunal led into error by neglecting to consider the income tax returns which reflects the true income of the deceased. Secondly, the personal expenses were incorrectly deducted. The learned trial court also erred in law in awarding future prospects and conventional heads which is in teeth of the law laid by Supreme Court in New India Assurance Co. Ltd. vs. Urmila Shukla and others² and National Insurance Company Ltd.

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vs. Pranay Sethi and others³ .

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6. The deceased had four dependants. The deduction of 1/3^rd made towards personal expenses made by the learned tribunal was

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2 2021 SCC OnLine SC 822

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3 2017 (16) SCC 680

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excessive. The amount which is liable to be deduction towards personal expenses of the deceased is 1/4^th . The claimants were entitled to a higher amount.

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7. Shri Anubhav Sinha, learned counsel for the Insurance Company contends that the award was just and lawful. However, he fairly contends that the award of future prospects was at variance in judgment laid by the Supreme Court in Pranay Sethi (surpa). Similarly, the personal expenses could not be disputed.

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V. Issues for Consideration:

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8. After advancing their arguments, learned counsels for the respective parties agree that only the following question falls for consideration in the appeal:

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Whether the learned tribunal while determining the compensation lawfully computed the amounts under these heads: income, future prospects, deduction, application of multiplier, conventional heads and interest?

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VI. Number of dependants and deduction towards expenses:

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9. The claimants-respondents claim the following persons as dependants on the deceased:

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Sr. No.	Name	Age	Relation
1.	Smt. Pooja Shukla	33	Wife
2.	Smt. Madhuri Shukl	63	Mother
3.	Sri Om Prakash Shukl	68	Father
4.	Km. Shreya Shukla	13	Daughter

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10. The deceased had four dependants(father, mother, wife and one minor children). The deduction of 1/3^rd made towards personal expenses by the learned tribunal was excessive. The

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amount which is liable to be deduction towards personal expenses of the deceased is 1/4^th .

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11. The determination is fortified by authorities in point. While deciding the issue of deduction of personal expenses, the Supreme Court in Sarla Verma (Smt) and others Vs Delhi

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Transport Company and another⁴ held:

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“30. Though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in Trilok Chandra [(1996) 4 SCC 362] , the general practice is to apply standardised deductions. Having considered several subsequent decisions of this Court, we are of the view that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependent family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceeds six.”

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12. Sarla Verma (supra) was later followed with approval in National Insurance Company Limited Vs. Pranay Sethi and others⁵ (See Pr. 37).

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VII. Issue of computation of the compensation under various heads:

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a. Salary of the deceased:

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13 . The learned tribunal was led into error by failing to consider the income tax returns filed by the claimants to support their claim. It is established that the deceased was a small skilled entrepreneur. He filed his income tax returns regularly. Income tax returns filed after his death was fully credible and the same was filed by the legal representatives/claimants in discharge of their obligation

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4 2009 (6) SCC 121

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5 2017 (16) SCC 680

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under Section 159 of the Income Tax Act. The relevant provision is extracted hereunder:

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“Legal representatives

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159. (1) Where a person dies, his legal representative shall be liable to pay any sum which the deceased would have been liable to pay if he had not died, in the like manner and to the same extent as the deceased.”

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14. Perusal of the income tax returns shows that such income tax returns was of credible nature and reflected true income of the deceased. The income of the deceased is quantified at Rs. 1, 95, 855/- per annum as reflected in the income tax returns. 15. Learned tribunal was erred in law by discarding the income tax returns for no good cause.

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b. Future Prospects:

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16. The future prospects are liable to be calculated in accordance with the Uttar Pradesh Motor Vehicles Rules, 1998⁶ . Rule 220A-3(iii) of the Rules is relevant and is reproduced hereunder:

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“(3) The future prospects of a deceased, shall be added in the actual salary or minimum wages of the deceased as under:

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“ (i) Below 40 years of age : 50% of the salary.”

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17. The UP Rules, 1998 came up for consideration before the Supreme Court in New India Assurance Co. Ltd. vs. Urmila Shukla and others⁷ . In Urmila Shukla (supra) upon consideration of various judgements including National Insurance Company Ltd. Vs. Pranay Sethi and others⁸ held:

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“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.

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6 (hereinafter referred to as the “UP Rules, 1998)

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7 2021 SCC OnLine SC 822

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8 2017 (16) SCC 680

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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. 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)

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18. The Rules of the Uttar Pradesh Motor Vehicles Rules, 1998 were not under consideration before the Supreme Court in Pranay Sethi (supra) or Sarla Verma (Smt) and others Vs. Delhi Transport Company and another⁹ . Future prospects in Pranay Sethi (supra) were determined without noticing the U.P. Rules,1998. This fact was adverted to in Urmila Shukla (supra) :

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“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.”

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19. 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

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9 2009 (6) SCC 121

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Sethi (supra) can not dilute the advantages conferred by U.P. Rules, 1998 upon the eligible beneficiaries.

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20. In this wake, this Court finds that the claimants/respondents are entitled to 50% enhancement in wages under the head of future prospects as contemplated in the U.P. Rules, 1998. The necessary changes in the award shall be accordingly made.

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c. Multiplier:

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21. The age of the deceased was 30 years at the time of the accident. The applicable multiplier as per Sarla Verma (Smt) and others Vs. Delhi Transport Company and another¹⁰ read with Pranay Sethi (supra) is 17.

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d. Calculation of Conventional Heads:

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22. 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:

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“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.

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10 2009 (6) SCC 121

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15,000/-, Rs. 40,000/- funeral expenses should be Rs. 15,000/-, Rs. 40,000/- And Rs. 15,000/- respectively.”

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23. The figure under conventional heads determined in Pranay Sethi (supra) shall be applicable to the facts of this case. The award is modified accordingly.

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e. Interest:

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24. Interest of 7% and the manner of payment decided by the learned tribunal is just and lawful and does not call for interference.

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VIII. Determination of Compensation to which claimantsrespondents are entitled:

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25. In wake of the preceding discussion, the amount of compensation to which the claimants are entitled and are hereby awarded, is tabulated hereunder:

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i. Date of Accident –14.08.2013 ii. Name of Deceased – Amit Shukla iii. Age of the deceased – 30 years

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iv. Occupation of the Deceased – Small entrepreneur

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v. Income of the deceased – 1,95,855 per annum

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vi. Name, Age and Relationship of Claimants with the deceased:

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Sr. No.	Name	Age	Relation
1.	Smt. Pooja Shukla	33	Wife
2.	Smt. Madhuri Shukl	63	Mother
3.	Sri Om Prakash Shukl	68	Father
4.	Km. Shreya Shukla	13	Daughter

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vii. Computation of Compensation

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Sr. No.	Heads	Amount (in Rupees)
1.	Monthly Income (A)	Rs. 16,321/-
2.	Annual Income (B) (A x 12 = B)	Rs. 1,95,852/-
3.	Future Prospects (C)	50% of 1,95,852/- = 97,926/-
4.	Annual Income + Future Prospects (B+C=D)	1,95,852+ 97,926/- = 2,93,778/-
5.	Deduction towards personal expenses (E) (1/4 of	¼ of 2,93,778/-

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D) = 73,444/-
6. Annual Loss of dependancy (F) 2,93,778-73,444/-
(D-E = F) = 2,20,334/-
7. Multiplier (G) 17
8. Total loss of dependancy 2,20,334 x 17
(F x G) = 37,45,678/-
9. Conventional Heads:
(a) Loss of consortium 70,000/-
(b) Loss of Estate
(c) Funeral Expenses
10. Total compensation 38,15,678/-
11. Interest 7%

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IX. Conclusions & Directions:

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26. In view of the above, the appeal is partly allowed.

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27. The amount of compensation to 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.

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Order Date :- 14.02.2023 Dhananjai

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Digitally signed by :- DHANANJAI High Court of Judicature at Allahabad

Pooja Shukla and 3 Others v. Vijay Kumar Tiwari and 2 Others

Case brief

What is this about?

What did the court decide?

Pooja Shukla and 3 Others v. Vijay Kumar Tiwari and 2 Others

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

Statutes considered

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