Disposed

Branch Manager,Oriental Insurance Co.Ltd.,Angul v. Santosh Ku.Bhukta@Maharathy@Maharathi

Orissa HC20 Dec 2024MACA/24/2016

Case brief

AI extract

What is this about?

Cross-appeals over a fatal road accident award for a deceased engineering student. The High Court raised his notional income from Rs.5,000 to Rs.15,000 per month relying on precedents, enhancing compensation to Rs.22,80,000 with interest at 6%, and granted the insurer a right of recovery against the uninsured-permit owner.

What did the court decide?

Compensation enhanced to Rs.22,80,000 with 6% interest; right of recovery granted against owner.

Branch Manager,Oriental Insurance Co.Ltd.,Angul Vs… — Motor Accident Claims | Orissa HC (2024)

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IN THE HIGH COURT OF ORISSA AT CUTTACK

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MACA Nos.845 & 24 of 2016

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In the matter of an appeal under Section 173 of the Motor Vehicles Act, 1988 and Rules framed thereunder.

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Santosh Kumar Bhukta @Maharathy @ Maharathi

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…. Appellants

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-versus-

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Arun Ku. Pati & Anr.

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…. Respondents

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For Appellants : M/s. H.N. Mohapatra.

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For Respondents : Adv for Resp. No.3 Mr. M.C. Nayak, Adv.

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PRESENT:

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THE HONBLE JUSTICE BIRAJA PRASANNA SATAPATHY

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----------------------------------------------------------------------------Date of Hearing: 20.12.2024 and Date of Judgment:20.12.2024

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Biraja Prasanna Satapathy, J .

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1 . This matter is taken up through Hybrid Arrangement (Virtual/Physical) Mode.

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2 . Since both the appeals arise out of a common order, both are heard analogously and disposed of by the present common order.

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3 . Perused the office note available in the connected MACA No. 24/2016. In spite of due service of notice on Respondent No. 4, who is the owner of the offending vehicle, no appearance has been made on his behalf.

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4 . While MACA No. 845 of 2016 has been filed by the Claimants seeking enhancement of the compensation so awarded by the Tribunal vide its Judgment dtd.09.10.2015 in MAC No. 165 of 2013, MACA No. 24 of 2016 has been filed by the Insurer challenging the aforesaid Judgment.

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5 . In support of the enhancement of the award, learned counsel appearing for the Claimant contended that the deceased while was prosecuting B. Tech in Mechanical Engineering in Pathani Samanta College of Engineering & Technology, he died in the road accident in question and such certificate was exhibited vide Ext. 11.

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5.1 . It is also contended that the deceased was the only son of the Appellants and because of the death of the deceased, the Appellants who happens to be the parents of the deceased were deprived from their love and affection for their entire life. It is also contended that even though evidence was laid showing the fact that the deceased was prosecuting 2^nd year B.Tech, but the Tribunal wrongly held the income of the deceased at Rs. 5,000/- per month and accordingly compensation was assessed at Rs.7,60,000/-.

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5.2. It is contended that with regard to the income of a B.Tech./ Engineering Student, this Court in MACA No. 484 of 2019 has held the income at Rs.15,000/- per month. It is also contended that in a similar issue while determining the income of an Engineering student, Hon’ble Apex Court in a Civil Appeal held the income at Rs.20,000/- per month. It is also contended that in a similar issue High Court of Delhi in its Judgment dtd.22.10.2018 held the income of the deceased Engineering student at Rs.15,000/- per month.

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5.3 . Learned counsel appearing for the Claimants accordingly contended that in view of the decision governing the field and the deceased being an Engineering student, which is not disputed, his monthly income should have been taken at Rs.15,000/- per month at least. But the Tribunal without proper appreciation of the same, while holding the income of the deceased at Rs.5,000/per month assessed the compensation at Rs.7,60,000/-. It is accordingly contended that the award so passed is required to be enhanced taking into account the income of the deceased at Rs.15,000/- per month.

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5 . 4 . Learned counsel for the appellant relied on the decisions in the case of Daniel Edward Harris & Another vs. Mahendra Kumar Das & Another and Raja Bala & Others vs. Sumit Dahiya & Others .

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5 . 5 . In Para-5 of the decision in the case of Daniel Edward Harris & Another vs. Mahendra Kumar Das & Another , the Hon’ble Apex Court held as follows:-

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“5. On perusal of the Award passed by the Claims Tribu nal, it is revealed that for death of a young boy aged 21 years pursuing Mechanical Engineering (Third Year) from KIIT University, Bhubaneswar, earning was fixed at ₹20,000/ per annum; 40 per cent was added for future prospects and 1/2 was deducted towards personal expenses as he was a bachelor. The Tribunal applied the multiplier of 18 and calculated loss of dependency at ₹30,24,000/. Further, adding ₹70,000/ towards loss of consortium, loss of estate and funeral expenses, the Tribunal awarded a total sum of ₹30,94,000/. In the appeal, the High Court reduced the same to ₹24,00,000/, recording the consent of both the counsel appearing for the parties. The penal interest of 12% per annum, as levied by the Tribunal, was reduced to 6% per annum”.

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5 . 6 . In Para-7.4, 7.5, 7.6, 7.7 & 8 of the decision in the case of Raja Bala & Others vs. Sumit Dahiya & Others , the Hon’ble Court held as follows:-

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“ 7.4. In HDFC Ergo General Insurance Co. Ltd. v. Rattan Kumar Dwivedi, 2017 SCC OnLine Del 9874, the accident dated 21st July, 2008 resulted in the death of a national level sportsperson who was a student of B. Com. (Hons.). The Claims Tribunal awarded Rs.10,40,000/- by taking the earning capacity of the deceased as Rs.10,000/- per month which was challenged on the ground that minimum wages should have been applied by the Claims Tribunal. Applying the principles laid down by the Supreme Court in Municipal Corporation of Delhi v. Association of Victims of Uphaar Tragedy, AIR 2012 SC 100, this Court rejected the application of minimum wages to such cases. Considering the brilliant record of the student as a sportsperson, this Court determined the earning capacity of the deceased as Rs.25,000/- per month and enhanced the compensation from Rs.10,40,000/- to Rs.24,50,000/-. The relevant portion of the judgment is as under:

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"14. In the present case, the deceased Apoorva Dwivedi was a student of B.Com (Hons.) at Bharti College, Delhi University. She was a sports person having won 86

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prizes/certificates in athletics, track and field, gymnastics, baseball, soft ball, basketball, cricket etc. The deceased had secured second place in team event at 40th Delhi State Gymnastics Championship, 2001; best athlete of the year 2003-2004 at school and zonal level and first position in baseball in 52nd National School Games conducted by School Games Federation of India held from 23rd December to 28th December, 2006. The deceased was sports captain of Holy Child Senior Secondary School, Tagore Garden, New Delhi for the academic year 2007-08. Judicial notice is taken of the notifications for government job for sports persons as well as advertisements in private jobs for sports persons, under which a graduate sports person can secure a job with a job in the pay scale of Rs.30,000/- to Rs.40,000/- per month. Considering that the deceased was a sports person with an extraordinary talent in various sports, namely, athletics, track and field, gymnastics, baseball, soft ball, basketball, cricket etc. and having been awarded 86 prizes/certificates, it is presumed that the deceased would have earned Rs.25,000/- per month after completing her graduation. Deducting 50% towards the personal expenses of the deceased and applying the multiplier of 14 according to the age of her mother, the loss of dependency is computed as Rs.21,00,000/- [(Rs.25,000-50%)x12x14]. The compensation for loss of love and affection is enhanced from Rs.25,000/- to Rs.1,00,000/-; and compensation for pain and suffering is enhanced from Rs.25,000/to Rs.1,00,000/-. Adding Rs.1,30,000/- towards medical expenses and Rs.20,000/towards funeral expenses, total compensation is computed as Rs.24,50,000/- [21,00,000/- + 1,00,000/- + 1,30,000/- + 1,00,000/- + 20,000/-]. The Claims Tribunal has awarded interest @ 7.5% per annum which is on a lower side considering that the Supreme Court as well as this Court are consistently awarding interest @ 9% per annum. The rate of interest is enhanced from 7.5% to 9% per annum."

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7.5. In HDFC Ergo General Insurance Co. Ltd. v. Lalta Devi, 2015 ACJ 2526, the accident dated 19th June, 2011 resulted in the death of a third year student of B. Tech. The Claims Tribunal awarded compensation of Rs.19,50,000/- by taking the earning capacity of the deceased as Rs.25,000/- per month. The insurance company and the claimants both challenged the award before this Court. This Court held the earning capacity of the deceased to be Rs.26,815/- per month by relying on the basic pay of a junior engineer and the compensation amount was enhanced from Rs.19,50,000/- to Rs.22,94,871/-.

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7.6. In United India Insurance Company Limited v. Anita, 2017 SCC OnLine Del 11152, the accident dated 16th June, 2009 resulted in the death of a 21 year old student of B. Tech. (Mechanical and Automation Engineering). The Claims

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Tribunal awarded Rs.34,65,689/- by taking the earning capacity of the deceased as Rs.26,815/- per month and 50% future prospects thereon, which was challenged by the insurance company. This Court upheld the award of the Claims Tribunal and dismissed the appeal. The relevant portion of the judgment is as under:

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"5. The Claims Tribunal took the income of the deceased as Rs.26,851/- following the judgment of this Court in HDFC Ergo General Insurance Co. Ltd. v. Lalta Devi, 2015 ACJ 2526 in which this Court took the income of a B.Tech third year student in a similar university as Rs.26,851/- according to the salary drawn by a Junior Engineer. The learned Tribunal has also taken into consideration that the deceased had passed the 5th semester in December 2008 and had received the approval for six weeks industrial training with Indian Airlines. The Claims Tribunal also considered the mark sheets of the deceased for 3rd, 4th and 5th semester along with certificate of excellence for 3rd semester and deceased had stood first in the 3rd semester examination in December, 2007. The Claims Tribunal also considered the statement of PW-2 who was a class fellow of the deceased and had initially joined Maxim Group in 2011 at a monthly salary of Rs.16,000/- as Production Engineer and thereafter, another company with a package of Rs.4,34,000/- per annum with 18% increment in the salary.

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6. This Court is of the view that the income of the deceased computed by the Claims Tribunal and the future prospects added thereon are fair and reasonable and does not warrant any interference."

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7.7. In New India Assurance Co. Ltd. v. Dilip Kumar, 2018 SCC OnLine Del 9263, the accident dated 01st September, 2012 resulted in the death of a 22 year old student of B.Sc.(Nautical Science) from Directorate General of Shipping and Indira Gandhi National Open University (IGNOU). The Claims Tribunal awarded compensation of Rs.26,40,000/- by taking the earning capacity as Rs.40,000/- per month. This Court held that the earning capacity of Rs.40,000/- per month was on a higher side and reduced the earning capacity of the deceased to Rs.25,000/-. The relevant portion of the judgment is as under:

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2. On 1st March, 2012 at about 1:30 A.M, Prateek Kumar and his friends were going from Connaught Place to Saket in a Mahindra Scorpio car bearing No. HR-11C- 6677 being driven by respondent No. 3. Respondent No. 3 lost control of the vehicle near Gate No. 1 of National Gallery of Modern Art, India Gate Outer Circle, Delhi due to which the vehicle struck against a tree and turned turtle. The police registered FIR No.

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33/2012 dated 1st March, 2012 against respondent no. 3 under Sections 279/337/338 of IPC at P.S. Tilak Marg.

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3. Prateek was sitting in the back seat of the offending vehicle, suffered hemorrhage in left frontal region; multiple fracture greated wing of sphenoid; fracture in left temporal parietal bone; fracture right mastoid with fracture sphenoid sinus; B/L hemothorax with collapse of B/L posterior basal segment; pneumothorax with multiple contusion; fracture of 6-7 and 8 ribs; diffuse axonal head injury with HPA suppression and spinal cord injury of D5-D6 vertebra. Prateek was taken to RML Hospital, where he was admitted for treatment. On 15th March, 2012, Prateek was shifted to Sir Ganga Ram Hospital for further treatment where he remained admitted till 03rd June, 2012. On 04th June, 2012, Prateek was taken to Nishant Hospital, Lucknow and he remained admitted there from 04th June, 2012 to 08th July, 2012; 26th July, 2012 to 27th July, 2012; 13thFebruary, 2013 to 1st March, 2013; 05th June, 2013 to 15th June, 2013; 18th June, 2014 to 25th June, 2014. He was admitted to NuTech MediWorld Hospital, New Delhi from 06th January, 2014 to 04th April, 2014.

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4. The injuries suffered by Prateek resulted in 100% disability relating to Post-traumatic paraplegia with B/B involvement and loss of vision (left) as per the disability certificate dated 04th August, 2013 (PW-1/25). Prateek remained bedridden for about 27 months and could not recover from the injuries suffered by him. Prateek succumbed to his injuries on 04th July, 2014 at R.D.S.O. Hospital, Manak Nagar, Lucknow.

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5. Prateek was aged 22 years at the time of the accident. He passed Senior Secondary School in the year 2008 with 82% marks and was pursuing B.Sc.(Nautical Science) six semester course jointly conducted by Directorate General of Shipping and Indira Gandhi National Open University (IGNOU). Prateek had completed the fifth semester of the six semester course. Prateek completed Pre-Sea Cadet course from Maritime Institute, Mumbai in the first and second semesters. Prateek completed 18 months training with Shipping Corporation of India in the third, fourth and fifth semesters and was getting a stipend of Rs. 10,000/- per month plus other perks.

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xxx xxx xxx

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10. The Claims Tribunal held that the accident occurred due to the rash and negligent driving by respondent No. 3 which resulted in grievous injuries to Prateek who later succumbed to his injuries. The Claims Tribunal took the earning capacity of the deceased as Rs. 40,000/- per month, deducted 50% towards personal expenses and applied the multiplier of 11

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according to the age of the mother to compute the loss of dependency as Rs. 26,40,000/-. The Claims Tribunal awarded Rs. 32,95,621/- towards medical treatment, Rs. 11,20,000/- towards loss of income during treatment, Rs. 3,50,000/- towards conveyance and attendant charges, Rs. 1,00,000/- towards loss of love and affection, Rs. 10,000/towards loss of estate and Rs. 25,000/- towards funeral expenses. The total compensation awarded is Rs. 75,40,621/-.

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Xxx xxx xxx

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20. In the present case, the deceased was a student of B.Sc. (Nautical Science). The deceased had successfully completed the Pre-Sea Cadet Course from Maritimes Training Institute and eighteen month On-Board training with Shipping Corporation of India and was getting stipend of Rs. 10,000/per month excluding perks. On successful completion of B.Sc. (Nautical Science), the deceased would have had a successful career in Merchant Navy. As per the terms and conditions of the appointment of a fresh graduate, Shipping Corporation of India pays wages of Rs. 1,03,620/- per month (Rs. 3,454/per day). This Court is of the view that the earning capacity of the deceased be taken as Rs. 25,500/- per month. Applying the well-settled principles of law laid down by Supreme Court and this Court in the aforesaid cases, the earning capacity of Rs. 40,000/- taken by the Claims Tribunal is reduced to Rs. 25,500/- per month. 21. Taking the income of the deceased as Rs. 25,500/- per month, adding 40% towards future prospects, deducting 50% towards his personal expenses, and applying the multiplier of 18, the loss of dependency is computed as Rs. 38,55,600/-." (Emphasis Supplied)

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8. In the present case, the deceased was a final year student of B.Tech., at Maharshi Dayanand University, Rohtak. The deceased had successfully completed three years of his four years degree programme. On successful completion of B.Tech., the deceased would have had a successful career. M/s Tech Indira IT Solutions Pvt. Ltd. had given placement offer of Rs.3,20,000/- per annum to the deceased. This Court is of the view that the deceased would have certainly earned higher amount in his lifetime but the earning capacity of the deceased is taken as Rs.26,660/- per month (Rs.3,20,000/per annum) since the claimants have restricted their claim to the above amount. This case is squarely covered by the wellsettled principles of law laid down by Supreme Court and this Court in the aforesaid cases. The earning capacity of the deceased is taken as Rs.26,660/- per month (Rs.3,20,000/per annum). The Claims Tribunal has taken future prospects of 40% which is fair and reasonable and is upheld”.

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6 . Mr. Nayak, learned counsel appearing for the Insurer on the other hand while challenging the impugned award contended that even though it was brought to the notice of the Tribunal that the offending vehicle was not having any permit, but while disposing the matter no right of recovery was allowed. It is also contended that award of interest at 7% per annum is on the higher side. Learned counsel however does not dispute the decisions so relied on by the learned counsel for the appellant.

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7 . Having heard learned counsel appearing for the Parties and considering the submissions made, this Court placing reliance on the decisions as cited (supra) is of the view that income of the deceased he being a 2^nd year Engineering Student should have been taken at Rs.15,000/- per month. While holding the income of the deceased at Rs.15,000/- per month, this Court assessed the compensation by enhancing the award so passed to Rs.22,80,000/-. However, taking into account the rate of interest prevailing at that point of time, this Court is inclined to allow interest @ 6% per annum on the awarded compensation amount of Rs.22,80,000/-.

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7.1 . Therefore, this Court directs the Appellant-Insurer in the connected MACA No. 24 of 2016 to deposit the compensation amount of Rs.22,80,000/- along with interest @ 6% per annum payable from the date of application till its realization before the Tribunal within a period of eight (8) weeks from the date of receipt of this

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order. On such deposit of the amount the Tribunal shall do well to disburse the same in favour of the Claimants proportionately in terms of the Judgment dtd.09.10.2015.

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7.2. However, it is observed that if the amount as directed will not be deposited by the AppellantCompany within the aforesaid time period of eight (8) weeks, the compensation amount of Rs22,80,000/shall carry interest @ 7% per annum for the period starting from the expiry of the period of eight (8) weeks till its payment.

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7.3 . It is further observed that on deposit of the entire award amount statutory deposit made in MACA No. 24 of 2016 be refunded along with accrued interest if any on proper identification.

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7.4 . It is also observed that since from the materials available on record it is found that offending vehicle was not having the permit and the same was also brought to the notice of the Tribunal, but no order since has been passed allowing right of recovery, this Court in absence of the Owner-Respondent is inclined to allow right of recovery as against the Owner-Respondent and allows the same accordingly. However, if any application is made to recover the amount from the Owner/Respondent, the Tribunal shall do well to dispose of the application in accordance with law and by giving due opportunity of hearing.

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