Dismissed

Reliance General Insurance Company Ltd. v. Sithra Napsinh Chada

Gujarat HC22 Jun 2018FA/3880/2017

Case brief

AI extract

What is this about?

Insurance company appealed compensation awarded in a motor accident claim. The Court rejected the appeal after finding no substantial error in the Tribunal's income assessment, reasoning that a 30% future rise and 1/3rd personal expenditure deductions were appropriately within limits and correcting them to precedent standards resulted in the same total amount.

What did the court decide?

First Appeal and Civil Application dismissed with no change in compensation award.

Reliance General Insurance Company Ltd. Vs Sithra… — Motor Accident Claims | Gujarat HC (2018)

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C/FA/3880/2017 ORDER

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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

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R/FIRST APPEAL NO. 3880 of 2017 With CIVIL APPLICATION NO. 1 of 2017

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RELIANCE GENERAL INSURANCE COMPANY LTD

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Versus SITHRA NAPSINH CHADA

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==========================================================

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Appearance:

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MR VIBHUTI NANAVATI(513) for the PETITIONER(s) No. 1 MR.HIREN M MODI(3732) for the RESPONDENT(s) No. 3,4,5 RULE SERVED(64) for the RESPONDENT(s) No. 2 RULE UNSERVED(68) for the RESPONDENT(s) No. 1

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CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI and

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HONOURABLE MR.JUSTICE B.N. KARIA

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Date : 22/06/2018

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COMMON ORAL ORDER (PER : HONOURABLE MR.JUSTICE AKIL KURESHI)

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1. This appeal is filed by the insurance company

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challenging the judgment and award dated 29.07.2017
passed by the Motor Accident Claims Tribunal,
Panchmahals, Godhara.

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2. Brief facts are as under.

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3.One Vinodbhai Jain, aged about 42 years, died in
a vehicular accident which took place on 08.02.2010.
He was riding his motorcycle, when a truck

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insured by the appellant insurance company dashed

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Page 1 of 7

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C/FA/3880/2017 ORDER

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against him causing fatal injuries. His dependents
i.e. his widow, minor children and aged mother, filed
the Claim Petition seeking compensation of Rs.29.80
lakhs from the driver, owner and the insurer of the
truck involved in the accident.

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4.The Claims Tribunal held that the truck driver
was solely negligent in causing the accident. With
respect to compensation, the Tribunal believed the
income of the deceased at Rs.14,000/- per month and
granted 30% rise for the future income. The Tribunal
thereafter deducted 1/3rdfor the personal
expenditure of the deceased, applied multiplier of 14
and worked out loss of dependency benefit at
Rs.20,38,334/-. Tribunal further awarded Rs.10,000/-
towards loss of estate, Rs.1 lakh for consortium,
Rs.25,000/- for funeral expenses, Rs.1 lakh for loss

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of love and affection and Rs.2,000/- for
transportation charges to come to the grand total of
Rs.22,75,350/-.

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5.While issuing notice for final disposal of the
First Appeal, we have confined the scope of this
appeal to recomputation of the compensation. By brief

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Page 2 of 7

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C/FA/3880/2017 ORDER

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speaking order, we have turned down the insurance
company's ground of negligence of the motorcyclist.

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6.In such background, counsel for the insurance
company raised following three contentions:

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I.The Tribunal committed an error in
believing the income of the deceased at
Rs.14,000/- per month on the date of the
accident. Income tax returns relied upon by the
Tribunal were filed after the event.

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II.The Tribunal granted 30% rise for future

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income as against 25% suggested by the Supreme
Court in case of National Insurance Company Ltd.

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v. Pranay Sethi and Ors. reported in 2017 (3)
GLR 536.

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III.Awarding a total sum of Rs.2,37,000/-

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towards the conventional heads was excessive.
The Supreme Court has combined all heads for a
total compensation of Rs.70,000/-.

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7.On the other hand, learned counsel Shri Modi for

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the claimants submitted that the deceased was a
businessman. Even before the date of accident, he

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Page 3 of 7

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C/FA/3880/2017 ORDER

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was paying income tax and filing returns. The
Tribunal therefore committed no error in accepting
his income at Rs.14,000/- per month. He further
pointed out that at the time of accident, there were
four claimants. The mother of the deceased expired
much later.

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8.With respect to the income of the deceased, the
claimants had produced the income tax returns for the
assessment years 2007-08 to assessment year 2010-11.
Returns for the assessment years 2007-08 and 2008-09
were filed on 16.01.2009 and the returns for the
assessment year 2009-10 and 2011-12 were filed on
14.05.2010. Total income declared in these returns
was Rs.90,000/-, Rs.1.21 lakhs, Rs.1.40 lakhs and
Rs.1.70 lakhs (rounded off) respectively. The
claimants had also examined the Income Tax Officer
posted at Godhara Income Tax Office. The profit and
loss accounts were also produced.

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9.It is true that the last two returns were filed
after the accident. Such returns are scrutinized by
Courts more cautiously. If any tendency of
artificially increasing the income of the deceased is

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Page 4 of 7

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C/FA/3880/2017 ORDER

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detected to the extent of possible inflation, the
income is scaled down. However, insofar as the
assessment year 2010-11 is concerned, on the date of
the accident the last date for filing the return had
not expired, in fact, the concerned financial year
was also not over. Merely because therefore such
return was filed after the death would not permit us
to discard the return out of hand.

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10.Even before his death, the deceased had filed
two returns and in two consecutive years declared
income of Rs.97,000/- and Rs.1.21 lakhs. He was
engaged in the trading of utensils. There was thus
steady rise in the income year on year which trend
was reflected in his later returns also. We do not
notice any dramatic increase in the income and the
returns filed after his death. All in all, we do not
find any reason to interfere with the assessment of
the income adopted by the Tribunal.

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11.The Tribunal however did commit an error in
granting 30% future rise of income as against 25%
provided by Supreme Court in case of Pranay Sethi
(supra). At the same time, the Tribunal was also not

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Page 5 of 7

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C/FA/3880/2017 ORDER

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correct in deducting 1/3rdfor the personal

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expenditure of the deceased. On the date of the
accident, there were four dependents i.e. the widow,
minor children and aged mother. As per the judgment
of the Supreme Court in case of Sarla Verma & Ors.
v. Delhi Transport Corporation & Anr reported in
(2009) 6 SCC 121, personal expenditure deduction
would be 1/4th. Lastly, the Tribunal granted
excessive amount under conventional heads, total of
which would be Rs.70,000/- as provided in case of

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Pranay Sethi (supra).

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12.The computation of compensation would therefore
worked out as under. Income of the deceased on the
date of the accident i.e. Rs.14,000/-. 25% increase
for future would bring his prospective income to
Rs.17,500/- per month. 1/4th thereof i.e. Rs.4375/-
would be deducted for his personal expenditure
leaving a net of Rs.13,125/- for his family or
Rs.1,57,500/- per annum. Multiplier of 14 would make

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the loss of dependency benefit to Rs.22,05,000/-,
adding Rs.70,000/- towards conventional heads, the
figure would make the grand total to Rs.22,75,000/-
which is just Rs.350/- short of what the Tribunal

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Page 6 of 7

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C/FA/3880/2017 ORDER

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awarded. In the final analysis therefore there would

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be no change.

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13.First Appeal is dismissed along with Civil

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Application.

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(AKIL KURESHI, J)

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(B.N. KARIA, J)

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ANKIT SHAH

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Page 7 of 7

Reliance General Insurance Company Ltd. v. Sithra Napsinh Chada

Case brief

What is this about?

What did the court decide?

Reliance General Insurance Company Ltd. v. Sithra Napsinh Chada

Case brief

What is this about?

What did the court decide?

What the court decided

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