Allowed

Smt.Salla Ramulamma v. The Andhra Pradesh State road Transport Corporation

Telangana HC15 Sept 2014MACMA/336/2011

Case brief

AI extract

What is this about?

In a Section 173 appeal against a compensation award under Section 163-A of the Motor Vehicles Act, the court held that loss of dependency must be calculated using gross salary less income tax, capped at Rs.40,000 annually. The compensation was enhanced, and future prospects were excluded per the structured formula.

What did the court decide?

Compensation enhanced from Rs.3,30,000 to Rs.4,79,032 with 6% interest. Apportionment as directed by Tribunal.

Smt.Salla Ramulamma Vs The Andhra Pradesh State road… — Motor Accident Claims | Telangana HC (2014)

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HON’BLE SRI JUSTICE C. PRAVEEN KUMAR

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M.A.C.M.A.No. 336 of 2011

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JUDGMENT:

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The claimants filed the present appeal under section 173 of the Motor Vehicles Act, 1988 (for short “the Act”), seeking enhancement of the compensation awarded in M.V.O.P.No.211 of 2003 on the file of the Motor Accidents Claims Tribunal-cum-I Additional District Judge, Cuddapah.

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For the sake of convenience, the parties will hereinafter be referred to as arrayed in O.P.

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The facts in issue are as under:

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The claimants, who are wife and daughter of one Salla Subba Reddy, filed a claim-petition under Section 163-A of the Act, claiming compensation of Rs.9,00,000/- for the death of said Subba Reddy in a road accident that occurred on 15.12.2002. It is stated that on that day the deceased was driving RTC bus bearing No. AP 10Z 7957 from Cuddapah to Bangalore. The said bus met with an accident at 8.30 p.m. near Neelakantarao Bridge on Rayachoty-Cuddapah main Road, as the bus dashed against a stationed lorry parked on the road, leading to the death of the deceased. Since the accident took place due to negligent act of the driver of lorry in parking the lorry without taking any precautionary measures and the present application is filed claiming compensation not only against the Road Transport Corporation but also against the second and third respondents, who are owner and insurer of the lorry.

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The second respondent owner of the lorry remained ex parte, while the third respondent, insurer of the lorry filed their counter denying the manner in which the accident took place. According to

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them the lorry bearing No. AP 04 T 7085 was parked on the extreme left side of the road, but the deceased, who was driving the bus failed to observe the parked lorry and hit lorry. It is stated that as there was no rashness or negligence on the part of the driver of the first respondent, the insurance company cannot be made liable to pay any compensation.

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The Road Transport Corporation (for short “the Corporation”) filed their counter denying the allegations made in the claim-petition. According to them when the bus reached near Neelakantaraopeta bridge, a lorry driven by its driver in a rash and negligent manner applied sudden brakes which resulted in accident. It is thus contended that the driver of the bus is not responsible for the accident.

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Basing on the above pleadings, the Tribunal framed the following issues:

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1) Whether the death of the deceased by name Salla Subbareddy S/o. Subbanna occurred on 16.12.2002 at 8.30 p.m. due to rash and negligent driving of RTC bus bearing No. AP 10 Z 7957 by its driver belonging to respondent No.1?

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2) Whether the petitioners are entitled for compensation and if so to what amount and from whom?

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3) To what relief?

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In support of their plea, the claimants examined PWs.1 and 2 and also got marked Exs.A1 to A9. On behalf of the respondents, the conductor of the bus was examined as RW.1 and an Assistant in the office of the third respondent was examined as RW.2. With consent Ex.B1 a copy of the insurance policy pertaining to the stationed lorry was marked.

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After analyzing the evidence available on record the Tribunal found that respondent Nos.2 and 3, who are the owner and insurer of the lorry are not liable to pay compensation, but only the Road Transport Corporation which was arrayed as respondent No.1 alone is

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liable to pay compensation and accordingly awarded a sum of Rs.3,30,000/-. Challenging the same the present appeal is filed.

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The finding of the Tribunal with regard to the manner in which the accident took place has become final as the same is not challenged by the Corporation. Therefore, the only point that arises for consideration is whether the compensation awarded by the Tribunal is just and reasonable.

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It may be necessary to note that the claim petition seeking compensation was filed under Section 163-A of the Act. The Tribunal by taking into consideration the net salary of the deceased at Rs.2,378/-, after deducting Rs.378/- towards personal and living expenses and after applying multiplier ‘13’ as the deceased was aged about 49 years, awarded a sum of Rs.3,12,000/- towards loss of dependency.

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The learned counsel for the appellants strenuously contended that the Tribunal erred in taking into consideration the net salary of the deceased for the purpose of calculating the loss of dependency. He also submits that the Tribunal erred in not taking into consideration the future prospects of the deceased.

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Per contra the learned Standing Counsel for the Corporation submits that since the claim petition is under Section 163-A of the Act, the maximum income which can be taken into consideration for the purpose of calculating the loss of dependency is Rs.40,000/- per annum and not beyond that.

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I n Reshma Kumari and others V. Madan Mohan and anothe r^[1] the Apex Court observed as under:

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“The 1988 Act gives a choice to the claimants to seek compensation on structured formula basis as provided in Section 163-A or make an application for compensation arising out of an accident of the nature specified in sub-

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section (1) of Section 165 under Section 166.

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The claimants have to elect one of the two remedies provided in Section 163-A and Section 166. The remedy provided in Section 163-A is not a remedy in addition to the remedy provided in Section 166 but it provides for an alternative course to Section 166.”

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As stated above, the claimant filed the petition seeking compensation under Section 163-A of the Act, which reads as under: 163-A. Special provisions as to payment of compensation on a structured formula basis:1) Notwithstanding anything contained in this Act or in any other law for the time being in force or instrument having the force of law, the owner of the motor vehicle or the authorized insurer shall be liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be. Explanation: for the purposes of this sub-section, “permanent disability” shall have the same meaning and extent as in the Workmen’s Compensation act, 1923.

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(2) In any claim for compensation under sub-section (1), the claimant shall not be required to plead or establish that the death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the owner of the vehicle or vehicles concerned or of any other person. (3) The Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time amend the Second Schedule.

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A reading of the said Section would indicate that the owner of the motor vehicle or the authorized insurer shall be liable to pay in the case of death or permanent disablement due to accident arising out of the use of motor vehicle, compensation, as indicated in the Second Schedule, to the legal heirs or the victim, as the case may be.

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From the judgment of the Apex Court referred to above it is clear that once the claimant exercises his choice/option and makes a claim under Section 163-A of the Act, the Tribunal or the Court cannot award compensation by treating the said application under Section 166 of the Act. The claimants are guided by the structured formula appended to

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Section 163-A of the Act.

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It is true that the finding of the Tribunal in taking the net income of the deceased for calculating the loss of dependency is not correct. As seen from the judgment of the apex Court in Mansvi Jain Vs. Delhi Transport Corporation and others^[2] it is not the net salary which has to be taken into consideration for determining the loss of dependency but the gross salary less the deduction towards income tax made thereon alone should be taken into consideration for the purpose of calculating the loss of dependency. This being an application under Section 163-A of the Act, there is no other option left open to the Court except to follow the guidelines laid down in Schedule-II appended to Section 163-A of the Act. That being the position, the maximum income which can be taken into consideration for calculating the loss of dependency would be Rs.40,000/- per annum. Since the application is under Section 163-A of the Act, the question of taking into consideration the future prospects of the deceased would not arise.

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As stated earlier, though the application was under Section 163-A of the Act the Tribunal instead of deducting 1/3^rd towards personal and living expenses, deducted only a sum of Rs.378/- per month since three persons including the deceased were dependent on the salary. As the said finding is not challenged by the Corporation, the question of setting aside the same in an appeal filed by the claimants does not arise. After deducting Rs.4,536/- (Rs.378/- x 12) from Rs.40,000/-, the contribution of the deceased to the family would be Rs.35,464/- per annum. The age of the deceased being 48 years at the time of accident the Tribunal adopted multiplier ‘13’ which needs no interference. Applying multiplier ‘13’, the total loss of dependency would be Rs.35,464/- x 13 = Rs. 4,61,032/-.

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The amount of Rs.18,000/- awarded under the conventional

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heads appears to be reasonable inconsonance with Section 163-A and the same needs no disturbance. Thus, in all the petitioners are entitled to Rs.4,43,032/-.

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Accordingly the appeal is allowed by enhancing the compensation from rs.3,30,000/- to Rs.4,79,032/-. The enhanced amount will carry an interest at 6% p.a. from the date of petition till the date of realisation. The enhanced amount shall be apportioned in the manner directed by the Tribunal.

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There shall be no order as to costs. The miscellaneous petitions, if any pending, shall stand closed.

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____________________ C. PRAVEEN KUMAR, J

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15.09.2014 gkv

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[1] (2013) 9 SCC 65

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[2] 2014 ACJ 1416

Smt.Salla Ramulamma v. The Andhra Pradesh State road Transport Corporation

Case brief

What is this about?

What did the court decide?

Smt.Salla Ramulamma v. The Andhra Pradesh State road Transport Corporation

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Cases cited

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