The United India Insurance Copany Limited Vs Gorusu Lakshmi and 3 Others

The Insurance Company preferred M.A.C.M.A.No.3739 of 2012 under Section 173 of the Motor Vehicles Act, 1988 assailing the award dated 07.09.2007 of the learned Chairman, Motor Accidents Claims Tribunal-cum-I Additional District and Sessions Judge, Visakhapatnam (hereinafter referred to as ‘the Claims Tribunal’) in M.O.P.No.152 of 2005.

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Questioning the inadequacy of compensation, the legal representatives of the deceased preferred I.A.No.2 of 2027 (Cross-Objections (S.R.) No.11048 of 2017) under Order XLI Rule 22(2) of C.P.C. impugning the award dated 07.09.2007 of the learned Chairman, Motor Accidents Claims Tribunal-cum-I Additional District and Sessions Judge, Visakhapatnam in M.O.P.No.152 of 2005

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3 Dr. VRKS, J M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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Heard arguments of Sri Naresh Byrapaneni, the learned counsel for appellant–Insurance Company and Sri S.N.K.Mahanthi, the learned counsel for respondent Nos.1 to 3/claimants.

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On death of Sri G.Ramakrishna in an automobile accident that took place on 21.07.2004 his legal representatives filed M.O.P.No.152 of 2005 praying for a compensation of Rs.24,00,000/-. The owner of the offending vehicle was respondent No.1 and the insurer was respondent No.2. After due trial, the learned Chairman, Motor Accidents Claims Tribunalcum-I Additional District Judge, Visakhapatnam passed the award in the following terms:

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“In the result, this petition is partly allowed with proportionate costs awarding compensation of Rs.14,05,560/- (Rupees fourteen lakhs five thousand five hundred and sixty only) with simple interest at 7.5% p.a from the date of petition till its realization. Respondents 1 and 2 are jointly and severally liable to pay the said compensation within one month from the date of this Judgment. Petitioners 1 to 3 are awarded compensation of Rs.4,68,520/- (Rupees four lakhs sixty eight thousand five

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4

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M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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hundred and twenty only) each. The share amount of first petitioner includes her consortium. First petitioner is permitted to withdraw an amount of Rs.1,00,000/- (Rupees one lakh only) from out of her share of compensation on deposit and balance of her compensation amount shall be kept in F.D.R in any nationalised bank for a period of 36 months. The shares of compensation of petitioners 2 and 3 shall be kept in F.D.R in any nationalised bank till they attain the age of majority. The first petitioner is permitted to withdraw the interest accrued on the shares of compensation of petitioners 2 and 3 once in three months for the benefit of petitioners 2 and 3. Rest of the petition claim is disallowed without costs. Advocate's fee is fixed at Rs.5,000/-(Rupees five thousand only).

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Assailing the said award, the insurance company preferred M.A.C.M.A.No.3739 of 2012 whereas the legal representatives of the deceased filed cross-objections whereunder they questioned the inadequate compensation that was awarded.

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The principal question raised by the insurance company in its appeal is on the premise that the claim was filed under Section 163A of Motor Vehicles Act, 1988 in which case multiplier formula is not applicable and such claims are limited to those whose

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5 Dr. VRKS, J M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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income does not exceed Rs.40,000/-. It is required to be mentioned here itself that the certified copy of award and the decree passed by the Claims Tribunal are annexed to the appeal papers. The certified copy shows that the claim petition was filed under Section 166 of Motor Vehicles Act. The record of the Claims Tribunal was called for and the same is perused and it is seen that the claim petition was filed under Section 166 of Motor Vehicles Act. Thus, the very contention of the appellantinsurance company that the claim was filed under Section 163A of Motor Vehicles Act is misplaced and therefore, nothing more survives for consideration in that regard.

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Coming to the cross-objections of the claimants various grounds are urged. Therefore, what has transpired before the Claims Tribunal is required to be noticed here.

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An auto rickshaw bearing registration No.AP-31-W-9317 was driven by its driver rashly or negligently at 4:30 P.M. on 21.07.2004 near N.T.P.C. gate, Visakhapatnam and it dashed a scooterist and consequently the scooterist Sri G.Ramakrishna fell

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6 Dr. VRKS, J M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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down and sustained serious injuries. Enroute to the hospital he

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succumbed to the injuries. The Parawada Police Station registered Crime No.59 of 2004 evidenced by Ex.A.1-F.I.R. The wife and two minor children of the deceased laid the claim for compensation. The owner of the offending vehicle/respondent No.1 therein did not contest. The insurance company laid its contest.

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The learned Claims Tribunal settled the following issues for

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trial:

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1. Whether the accident occurred due to rash and negligent driving of the driver of auto-rickshaw bearing registration No.AP-31-W-9317?

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1. Whether the petitioners are entitled for compensation amount, if so, to what amount?

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1. To what relief?

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For claimants, evidence of PWs.1 to 3 and Exs.A.1 to A.6 was placed. For respondents, neither oral nor documentary evidence was adduced.

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M.A.C.M.A.No.3739 of 2012 &

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I.A.No.2 of 2017

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Before the Claims Tribunal it was undisputed that at the

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material point of time the offending vehicle was covered by insurance policy issued by the United India Insurance Company Limited. It was also found undisputed that there were no policy violations.

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The deceased was found aged 44 years and was working as Technician in steel plant. To prove his income there was evidence of PW.3 and Ex.A.4-pay particulars and Ex.A.6-pay slip. Based on them, the claimants contended that the deceased was getting monthly salary of Rs.21,138.26 ps. After making a detailed analysis of the evidence, the learned Claims Tribunal stated that what could be considered as the take home salary of the deceased was basic pay of Rs.7,019/-, Dearness Allowance of Rs.3,215/-, House Rent Allowance of Rs.1,228.32 ps. Thus, it found Rs.11,463/- as the take home salary of the deceased. It deducted 1/3^rd of the said amount towards possible personal and

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living expenses of the deceased. Considering the age of the deceased as 44 years it applied multiplier ‘15’ and accordingly granted an amount of Rs.13,75,560/towards loss of

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M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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dependency. Under the conventional heads it granted Rs.10,000/- towards loss of consortium, Rs.15,000/- towards loss of estate and Rs.5,000/- towards transportation and funeral expenses. Thus, the total compensation awarded was Rs.14,05,560/-.

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Appearing on behalf of the claimants/cross-objectors the learned counsel argued that the Claims Tribunal committed an error in not considering future prospects and not granting compensation under conventional heads as available under law and prayed for enhancement of compensation and cited the following precedent:

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Sarla Verma v. Delhi Transport Corporation¹

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Usha Rajkhowa v. Paramount Industries²

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Bhupathi Prameela v. Superintendent of Police,

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Vizianagaram³

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1 2009 ACJ 1298

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2 2009 ACJ 1314

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9 Dr. VRKS, J M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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B.K. Filling Station v. Harishchandralal Shrivastava⁴

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Jitendra Khimshankar Trivedi v. Kasam Daud Kumbhar⁵

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As against it, the learned counsel for appellant-insurance

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company contended that the Claims Tribunal appropriately considered the facts and granted compensation in accordance with law and that requires no interference in this appeal.

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After considering the rival submissions and the material on record and the principles contained in the precedent cited, the following aspects are to be stated:

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In the celebrated ruling of their Lordships of the Hon’ble Supreme Court of India in Sarla Verma’ s case⁶ , it was held that persons aged between 41 to 45 years the appropriate multiplier to be applied is ‘14’. Where the deceased is a salaried employee,

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3 2011 ACJ 861

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4 2011 ACJ 877

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5 2015 LawSuit(SC) 82

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6 supra 1

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10 Dr. VRKS, J M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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the Tribunals and Courts should consider 30% of the salary towards future prospects for those deceased employees who were aged between 40 to 50 years. In the case at hand, the Claims Tribunal omitted to consider future prospects. The Claims Tribunal applied multiplier ’15’. Both being incorrect they must be rectified.

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Though on the grounds urged in the cross-objections it is stated that the salary of the deceased should be taken at Rs.21,138/- per month, the fair submission of the learned counsel for cross-objectors and the calculation memo filed on behalf of the cross-objectors agree with the finding of the Claims Tribunal that the monthly salary of the deceased is to be considered at Rs.11,463/-. Therefore, nothing more is required to be stated with reference to the salary.

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On taking the monthly salary of the deceased as Rs.11,463/-, 30% is to be added towards future prospects. On doing so, it comes to Rs.14,902/-. 1/3^rd of it comes to Rs.4,967/-. If that is deducted towards possible personal expenses of the

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M.A.C.M.A.No.3739 of 2012 & I.A.No.2 of 2017

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deceased, net monthly income comes to Rs.9,935/-(Rs.14,902/- -

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Rs.4,967/-). Per year it comes to Rs.1,19,220/-. On applying multiplier ‘14’, it comes to Rs.16,69,080/-. Thus, an additional amount of Rs.2,93,520/- is granted towards loss of dependency.

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18. In National Insurance Company Limited v. Pranay

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Sethi⁷ , towards the conventional heads their Lordships held as below:

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Loss of estate - Rs.15,000/-

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Loss of Consortium - Rs.40,000/-

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Funeral expenses - Rs.15,000/-

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In the case at hand, towards conventional heads, the

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learned Claims Tribunal granted an amount of Rs.30,000/-. Thus, an additional amount of Rs.40,000/- should be granted under these conventional heads.

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7 (2017) 16 SCC 680

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20. Therefore, an additional amount of Rs.3,33,520/- is granted towards compensation.

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21. In the result, M.A.C.M.A.No.3739 of 2012 is dismissed.

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I.A.No.2 of 2017 (Cross-Objections (S.R.) No.11048 of 2017) is partly allowed enhancing the compensation awarded in the impugned award dated 07.09.2007 of the learned Chairman, Motor Accidents Claims Tribunal-cum-I Additional District and Sessions Judge, Visakhapatnam in M.O.P.No.152 of 2005 from Rs.14,05,560/- to Rs.17,39,080/- with 7.5% interest per annum from the date of petition till the date of realisation. Respondent Nos.1 and 2/ the insurance company and the owner of the offending vehicle are jointly and severally liable to pay the compensation. The first respondent herein in Cross-Objections - Insurance Company is directed to deposit the amount within one month before the Claims Tribunal after giving due credit to amounts, if any, deposited already. On such deposit, the claimants are entitled to withdraw the same as per their entitlement mentioned in the award of the Claims Tribunal along

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with costs and accrued interest thereon. There shall be no order as to costs in this appeal.

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As a sequel, miscellaneous applications pending, if any, shall stand closed.

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________________________ Dr. V.R.K.KRUPA SAGAR, J

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Date: 05.03.2025 Ivd

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14 Dr. VRKS, J M.A.C.M.A.No.3739 of 2012 &