Patna High Court
Shri Ram General Insurance Co Ltd,versusRitu Agrawal and Ors
- Decided
- Disposal
- DISPOSED
- Bench
- RAJIV ROY
Holding
The High Court upheld the Tribunal’s use of average tax returns but increased the compensation by applying a one‑fourth deduction for five dependents.
Summary
The claimants, widows and children of a deceased businessman, sought compensation under the Motor Vehicles Act after a truck collided with their motorcycle, killing the husband. The Motor Accident Claims Tribunal awarded Rs 25,19,616, calculating loss of income using the average of two years of income‑tax returns and applying a one‑third deduction for five dependents. On appeal, the claimants argued that the Tribunal should have used the last tax return and applied a one‑fourth deduction as per Supreme Court precedents, while the insurer contended issues of mis‑joinder and fault. The Patna High Court held that the Tribunal’s discretion to use the average return was valid, but accepted the claimants’ contention on the dependent ratio, recalculating the award to Rs 36,20,155 plus interest. The court modified the Tribunal’s order accordingly and ordered the return of the statutory deposit.
Issues considered
- Whether the Tribunal erred in using the average of two years' income‑tax returns instead of the last return for calculating compensation.
- Whether the deduction for dependents should be one‑fourth rather than one‑third when there are five family members.
- Whether the insurer can be held liable despite the non‑joinder of the motorcycle owner.
Legislation cited
- Motor Vehicles Act, 1988 — s. 138, 140
Subjects
- motor accident
- compensation
- dependents
- income tax return
- Motor Vehicles Act
- insurance liability
- appellate court
Judgment
IN THE HIGH COURT OF JUDICATURE AT PATNA
Miscellaneous Appeal No.827 of 2014
======================================================
1. Ritu Agrawal W/o Late Chandrahas Kumar Agrawal @ Chandrahas Agrawal
@ Pappu Jee
2. Pooja Agrawal D/o Late Chandrahas Kumar Agrawal @ Chandrahas
Agrawal @ Pappu Jee
3. Krishna Agrawal D/o Late Chandrahas Kumar Agrawal @ Chandrahas
Agrawal @ Pappu Jee
4. Hema Agrawal D/o Late Chandrahas Kumar Agrawal @ Chandrahas
Agrawal @ Pappu Jee
5. Yash Agrawal minor son of Late Chandrahas Kumar Agrawal @ Chandrahas
Agrawal @ Pappu Jee Serial No. 5 is minor son of Late Chandrahas Kumar
Agrawal @ Chandrahas Agrawal @ Pappu Jee under the guardianship of
their mother and natural guardian appellant No. 1. All are resident of Flat
No. 502, Ashiana Vihar, Rajendra Path Near C.D.A. Building, P.S. - Gandhi
Maidan, District - Patna.
... ... Appellant/s
Versus
1. Manager, Sriram General Insurance Company Ltd. Insurer of Truck No. AP -
28TA - 5466
2. Raoshank Chillure S/o Kamlakar Chillure Flat No. G-6, Vajreshwari
Complex, Hal Colony Bus Stop, Old Bowenpally Quthumbullapur,
Rangareddy, Hyderabad Pin 500072 Owner of the Truck
3. Guddu Choudhary S/o Ram Sarup Choudhary Village and P.S. - Mohaniya,
District - Bhabhua.
... ... Respondent/s
======================================================
with
Miscellaneous Appeal No. 496 of 2015
======================================================
Shri Ram General Insurance Co Ltd,
... ... Appellant/s
Versus
1. Ritu Agrawal W/o Late Chandrabas Kumar Agrawal @ Chandra Has
Agrawal @ Pappu Jee
2. Pooja Agrawal D/O Late Chandrabas Kumar Agrawal
3. Krishna Agrawal D/O Late Chandrabas Kumar Agrawal
4. Hema Agrawal D/O Late Chandrabas Kumar Agrawal
5. Yash Agrawal S/O Late Chandrabas Kumar Agrawal, All Resident of
Village- 502 Ashiana Vihar, Rajendra Path Near CDA Building, P.S.- Gandhi
Maidan, District- Patna.
6. Roshan Kumar Chillure S/O Kamlakar Chillure, Resident of Flat no- G 6,
Patna High Court MA No.827 of 2014 dt.08-01-2026
2/12
Vajreshwari Complex, Hal Colony Bus Stop, Old Bowenpally Qutubullapur,
Rangareddy, Hyderabad, Andhra Pradesh- 500072
7. Guddu Chaudhary S/O Ram Sarup Chaudhary, Resident of village P.S.-
Mohaniya, District- Bhabhua.
... ... Respondent/s
======================================================
Appearance :
(In Miscellaneous Appeal No. 827 of 2014)
For the Appellant/s : Mr. Mukesh Prasad Singh, Advocate
For the Respondent/s : Mr.
(In Miscellaneous Appeal No. 496 of 2015)
For the Appellant/s : Mr. Alok Kumar @ Alok Kr. Shahi, Advocate
For the Respondent/s : Mr.
======================================================
CORAM: HONOURABLE MR. JUSTICE RAJIV ROY
ORAL JUDGMENT
Date : 08-01-2026
Heard Mr. Mukesh Prasad Singh, learned counsel for
the appellant in MA. No. 827 of 2014 and Mr. Alok Kumar
Shahi learned counsel for the appellant-company in MA. No.
496 of 2015.
2. Both MA. No. 827 of 2014 and MA. No. 496 of
2015 arises out of the Judgment and order dated 20.09.2014
and award dated 06.04.2015 passed by the Additional District
Judge-VII-cum-Motor Accident Claims Tribunal, Patna
(henceforth for short ‘the Tribunal’) in Claim Case No.
98/2011 by which the claim put forward by the lady-appellant in
MA No. 827 of 2014 was allowed with direction to the
Insurance Company to pay compensation amount of Rs.
25,19,616/-.
3. Both the parties are aggrieved and have preferred
Patna High Court MA No.827 of 2014 dt.08-01-2026
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their respective appeal.
4. The ground taken in MA No. 827 of 2014 by the
claimant-appellants is/are that:
(i) ‘the Tribunal’ took into account the
average of the income tax return of the two years
instead of the last return while calculating the
amount;
(ii) when the dependents were more than
three, then the deduction should have been one-
forth and not one-third, as such, the amount has to
be enhanced.
5. The Insurance Company on the other hand has
preferred the appeal (MA. No. 496 of 2015) on the ground that
the motorcycle met with an accident but the owner of the said
motorcycle was not made party nor the insurance company was
impleaded in the said case. Another ground has been taken that
it was negligence on the part of the deceased that led to the
accident.
6. The short fact of the case is that the claimant’s
husband, Chandrahas Kumar Agrawal was moving alongwith
a pillion rider from Mokama to Lakhisarai on 13.02.2011 on a
Pulsar motorcycle (Reg. No. BR-28C-4358) when a Truck
Patna High Court MA No.827 of 2014 dt.08-01-2026
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(Reg. No. AP-28TA-5466) overtook them and from the
backside of the said truck, they were hit. The claimant’s
husband died on the spot while the Pillion rider, who survived,
lodged the FIR.
7. ‘The Tribunal’ took up the matter and issues were
framed as under:
“I- whether the claim case is
maintainable or not?
II- whether the accident took place due
to rash and neglivent driving of the driver of the
alleged vehicle?
III- whether the alleged vehicle involved
in the accident was insured by Opposite Party No.
1 Shri Ram General Insurance Co. Ltd. at the
alleged date and time of occurrence?
IV- whether the driving licence of the
alleged driver and permit of the alleged vehicle
was effective at the date and time of occurrence?
V- whether the monthly income of the
deceased is genuine?
VI- whether the Opposite Party No. 1
Shri Ram General Insurance Co. Ltd or owner of
Patna High Court MA No.827 of 2014 dt.08-01-2026
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the alleged vehicle is liable to pay compensation
amount to the claimants?
VII- whether the claimants are entitled
for other relief or reliefs?”
8. ‘The Tribunal’ went into the matter and having
found the claim to be genuine/maintainable further held that it
was due to the negligent driving of the truck driver which was
insured with the Shri Ram General Insurance Co. Ltd.
(henceforth for short ‘the Insurance Company’) that the accident
took place leading to the unfortunate death. Further, the truck
was having a valid driving license and permit of the vehicle at
the time of the occurrence. It accordingly, held ‘the Insurance
Company’ liable for payment.
9. So far as the misjoinder and non-joinder of
necessary party is/are concerned, ‘the Tribunal’ held that the
same is not maintainable in the eyes of law as it has been proved
that the accident took place due to rash and negligent driving of
the truck driver which was having valid document and further
was insured with ‘the Insurance Company’.
10. So far as the calculation is concerned, it took the
two calender years of the income tax return of the deceased who
was a businessman and came to the conclusion that taking the
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average of the same coupled with the expenses that may have
taken place, it held that the claimant is entitled to Rs.
25,69,616/- only. As the interim compensation of Rs. 50,000/-
was paid, direction was given to pay Rs. 25,19,616 alongwith
interest of 7% from the date of filing of the claim till its
realization. This order came to be passed on 20.09.2014.
11. Aggrieved, as recorded earlier, both the parties
preferred the appeal as recorded above.
12. Learned counsel for the appellant-claimant
submits that:
“(i) ‘the Tribunal’ erred in taking the average
of the two calender years of the IT returns and it should
have taken the last enhanced return while calculating the
amount;
(ii) further submission is that following the
case of National Insurance Company Limited vs.
Pranay Sethi and Others reported in (2017) 16 SCC 680,
as the family of the claimant consisted of five persons, the
calculation should have been one-fourth and not one-
third.”
13. In support of the first contention, the learned
counsel for the appellant provided the order of the Hon’ble
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Apex Court in the case of Nidhi Bhargava & Ors. vs.
National Insurance Company & Ors. [Special Leave Petition
(CIVIL) No. 10664 of 2019] wherein the High Court having
ignored the last income tax return and reduced the amount that
was directed to be paid by ‘the Tribunal’, came to the
conclusion that though the last return was filed after the death, it
was for the period 01.04.2007 to 31.03.2008 and as such, the
same should have been taken into account.
14. This Court has taken note of the observation made
by the Hon’ble Apex Court in paragraph-15 of the same order
which read as follows:-
“15. The High Court interfered and
reduced the compensation as awarded by the
Tribunal only on the ground that Return for the
Assessment Year 2008-2009 had to be excluded from
consideration. It is not in dispute that the deceased
was a businessman. The relevance of the Income Tax
Return stems, in the context of the Act, for the period
which it relates to i.e., the Financial Year concerned,
and not on the date on which it is filed with the
Income Tax Department. When faced with Returns
for different Assessment Years, it would be upto the
Tribunal concerned to adopt either the average
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income therefrom or choose an Assessment Year to
rely upon. There is good reason to leave judicial
discretion on the Tribunal to adopt one of the afore-
noted two courses of action, bearing in nature the
social purpose and object behind the Act, which is a
beneficial legislation. It is quite unfortunate that the
High Court in the present case has dealt with the
matter in such a casual and superficial way where
the rightful claim of the appellants under a welfare
legislation has been drastically reduced without any
cogent reason on a very tenuous ground, which we
find to be totally unjustified. As pointed out in
Shivaleela v Divisional Manager, United India
Insurance Co. Ltd., 2025 SCC OnLine SC 563:
(emphasis added)
'13.... In K Ramya v. National Insurance
Co. Ltd., 2022 SCC OnLine SC 1338, after taking
note of, inter alia, Ningamma v. United India
Insurance Co. Ltd., (2009) 13 SCC 710, the Court
held that the .... Motor Vehicles Act of 1988 is a
beneficial and welfare legislation that seeks to
provide compensation as per the contemporaneous
position of an individual which is essentially
Patna High Court MA No.827 of 2014 dt.08-01-2026
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forward-looking. Unlike tortious liability, which is
chiefly concerned with making up for the past and
reinstating a claimant to his original position, the
compensation under the Act is concerned with
providing stability and continuity in peoples' lives in
the future....'...2
(underlined in original)
15. The appellant-claimant clearly missed the said
observation in paragraph 15 of the order.
16. This Court is also of the opinion that when faced
with returns for different Assessment Years, it would be for ‘the
Tribunal’ to adopt either the average income therefrom or
choose an assessment year to rely upon. This judicial discretion
is better left upon ‘the Tribunal’ to adopt one of the afore-noted
two courses of action. Certainly this is a beneficial legislation.
17. As recorded above, ‘the Tribunal’ has taken the
average of the two years while calculating the compensation
amount and as such, so far as the first contention of the
appellant-claimant is concerned, the same is rejected.
18. So far as the second contention is concerned,
learned counsel for the appellant-claimant has taken this Court
to the case of National Insurance Company Limited vs.
Pranay Sethi and Others reported in (2017) 16 SCC 680
Patna High Court MA No.827 of 2014 dt.08-01-2026
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wherein taking into account the order of the Hon’ble Apex
Court in Sarla Verma & Ors. vs. Delhi Transport
Corporation & Anr. reported in (2009) 6 SCC 121 where it has
been recorded that in case of dependents being four to six, one-
fourth ratio has to be applied. The submission is that ‘the
Tribunal’ clearly erred in taking the one-third into account while
direction for making payment as such, thus, at least the
deduction should be one-forth and not one-third.
19. Learned counsel, Mr. Shahi on the other hand,
representing the appellant-company opposes the prayer
submitting that the facts of the case do not clearly show who
was at fault, the truck driver or the motorcycle owner (deceased)
and in that background, directing ‘the Insurance Company’ with
whom the truck was insured to make the payment is/was not
justified.
20. He, however, concede to the fact that in view of
the judgments of the Hon’ble Apex Court (as recorded above)
where the dependent family members are between four to six,
one-fourth ratio has to be applied.
21. This Court has taken note of the submissions put
forward by the parties as also the decision of the Hon’ble Apex
Court both in Sarla Verma (supra) as also Pranay Sethi
Patna High Court MA No.827 of 2014 dt.08-01-2026
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(supra). Learned counsel for the claimant-appellant submits that
it will be suffice if following the Hon’ble Apex Court order, the
one-fourth ratio is applied in the present case.
22. This Court must put on record its word of
appreciation for Mr. Alok Kumar Shahi who assisted the Court
in recalculating the amount taking into account the one-fourth
ratio in terms of decision of the Hon’ble Apex Court (as
recorded above in the aforesaid two orders).
23. The recalculated amount (taking one-fourth ratio
into account) is as follows:
Income – 295398
Less ¼th – 73849
221548
Multiplier – 13
2880124
Future Prospect 25% – 7,20,031
36,00,155
Other Head (Funeral Exp. + Loss of Estate + Loss
of consortium) -- 70,000
36,70,155
Less – amount Paid – 50,000
36,20,155/-
24. In that background, the order passed by ‘the
Tribunal’ in Claim Case No. 92 of 2011 (Ritu Agrawal & Ors.
vs. Manager, Sriram General Insurance Company Ltd. &
Patna High Court MA No.827 of 2014 dt.08-01-2026
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Ors.) disposed of on 20.09.2014 is modified to the extent that
the appellants in the MA No. 827 of 2014 shall be entitled to
Rs. 36,20,155/- instead of Rs. 25,19,616 which shall be paid
alongwith interest of 7% per annum ( as per the direction given
by ‘the Tribunal’) from the date of the filing of the claim till the
actual payment is made.
25. Both MA. No. 827 of 2014 and MA. No. 496 of
2015 stand disposed of with aforesaid observation.
26. The statutory amount of Rs. 25,000/- deposited by
‘the Company’ has to be returned.
(Rajiv Roy, J)
Adnan/-
AFR/NAFR AFR
CAV DATE N/A
Uploading Date 12.01.2026
Transmission Date N/A
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