Allahabad High Court
SMT. ARPI GUPTA AND OTHERSversusUNITED INDIA INSURANCE CO. LTD. AND ANOTHER
- Decided
Holding
The Court held that the Tribunal's income assessment was too low and ordered a higher income assessment with a 40% addition for future prospects, thereby modifying the compensation award.
Summary
The claimants sought compensation for the death of Anil Kumar, who was crushed by a jeep while waiting on the roadside. The Motor Accident Claims Tribunal awarded Rs.1,77,000 based on a notional annual income of Rs.15,000 and a multiplier of 17, rejecting the claimants' evidence of a higher income. On appeal, the High Court held that the Tribunal had assessed the deceased's income too low and, in the absence of reliable proof of Rs.6,000 per month, fixed a reasonable income of Rs.3,000 per month (Rs.36,000 per annum). The Court also ordered a 40% addition for future earning prospects, while retaining the Tribunal's deductions, multiplier, funeral and consortium amounts. Consequently, the compensation was increased to Rs.5,78,200, with interest at 9% per annum, and the appeal was allowed in part.
Issues considered
- Whether the Tribunal erred in assessing the deceased's income at Rs.15,000 per annum.
- Whether a future prospects addition should be made to the loss of dependency.
- Whether the Supreme Court guidelines in Sarla Verma and National Insurance Co. v. Pranay Sethi are applicable to an accident that occurred in 2002.
- Whether the other parameters (deduction for personal expenses, multiplier, funeral and consortium) adopted by the Tribunal are correct.
Legislation cited
Subjects
- motor accident
- compensation
- loss of dependency
- future prospects
- income assessment
- multiplier
- Motor Vehicles Act
- Supreme Court guidelines
Judgment
HIGH COURT OF JUDICATURE AT ALLAHABAD
FIRST APPEAL FROM ORDER No. - 883 of 2004
Smt. Arpi Gupta And Others
.....Appellant(s)
Versus
United India Insurance Co. Ltd. And Another
.....Respondent(s)
Counsel for Appellant(s) : P.K. Agarwal, Ram Singh
Counsel for Respondent(s) : Arun Prakash, Vipul Kumar
Court No. - 54
HON'BLE ANIL KUMAR-X, J.
1. Heard Shri Ram Singh, learned counsel for the appellants and Shri Vipul
Kumar, learned counsel for respondent no.1-Insurance Company.
2. This appeal, at the instance of the claimants seeking enhancement of
compensation, challenges the judgment and award dated 18.12.2003 passed
by the Motor Accident Claims Tribunal, Bareilly (hereinafter referred to as
the "Tribunal") in M.A.C.P. No.269 of 2002 (Smt. Arpi Gupta & Ors. vs.
United India Insurance Company Ltd. & Anr.), whereby a sum of
Rs.1,77,000/- has been awarded to the claimants as compensation.
Brief facts of the appeal
3. The deceased Anil Kumar met with an accident on 27.02.2002 at about
07:00 a.m. It was alleged that he was standing on the side/sidewalk of the
road and was waiting for a conveyance. At that time, Jeep bearing
registration No. UP-22/7494 came and crushed him, as a result of which he
died.The claimants instituted a claim petition seeking compensation on
account of the death of Anil Kumar. It was pleaded that the deceased was
aged about 26 years and was earning Rs.6,000/- per month from agricultural
work as well as by running a shop.
4. Learned Tribunal did not accept the income of Rs.6,000/- per month as
pleaded by the claimants. His income was, therefore, assessed on the basis of
notional income at Rs.15,000/- per annum. After deducting 1/3rd towards his
personal expenses, the loss of dependency was assessed at Rs.10,000/- per
annum. Considering the age of the deceased as 23 years on the basis of his
Transfer Certificate, multiplier of 17 was applied. Learned Tribunal further
awarded Rs.2,000/- towards funeral expenses and Rs.5,000/- towards loss of
consortium. Thus, a total compensation of Rs.1,77,000/- was awarded in
FAFO No. 883 of 2004
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favour of the claimants along with interest at the rate of 9% per annum.
Arguments by learned counsel for the appellant
5. Learned counsel for the appellant submits that the income of the deceased
has been assessed on the lower side by the learned Tribunal. It is submitted
that there was no impediment in assessing the income of the deceased at
Rs.3,000/- per month by taking his daily income at Rs.100/-. It is further
submitted that no amount towards future prospects has been added while
assessing the loss of dependency. Learned counsel also submits that
adequate amount under the non-pecuniary heads has not been awarded in
accordance with the principles laid down by the Hon'ble Supreme Court in
Sarla Verma v. Delhi Transport Corporation.
Arguments by learned counsel for the respondents
6. Per contra, learned counsel for the respondents submits that the income of
the deceased was rightly assessed by the learned Tribunal. The alleged
income of Rs.6,000/- per month was not proved by the claimants by
producing any reliable evidence. It is further submitted that once the income
has been assessed on the basis of notional income, there is no question of
adding any amount towards future prospects. It is, therefore, submitted that
the compensation awarded by the learned Tribunal is just and adequate and
does not call for any interference.
Conclusion
7. Having considered the submissions advanced by learned counsel for the
parties and the material available on record, this Court finds that the income
of the deceased has been assessed by the learned Tribunal on the lower side.
The deceased was stated to be aged about 23 years and was engaged in
agricultural work as well as running a shop. Though the claimants could not
establish the pleaded income of Rs.6,000/- per month by reliable evidence,
considering the age of the deceased and the nature of work in which he was
engaged, there was no justification to confine his income to the notional
income of Rs.15,000/- per annum. In the facts of the case, it would be
appropriate to assess his income at Rs.3,000/- per month by taking his daily
income at Rs.100/-.
8. So far as the other parameters for determination of compensation are
concerned, the accident took place on 27.02.2002. Therefore, the
compensation is required to be assessed keeping in view the legal position
applicable to the accident in question. The principles subsequently laid down
FAFO No. 883 of 2004
3
by the Hon'ble Supreme Court in Sarla Verma and National Insurance
Company Ltd. v. Pranay Sethi were rendered much later. Applying all the
guidelines contained in those judgments mechanically to an accident of the
year 2002 would not be appropriate. In the present case, the assessment
already made by the learned Tribunal on the basis of the Second Schedule to
the Motor Vehicles Act, wherever applicable, does not call for interference
merely on account of the subsequent judgments.
9. At the same time, the question of future prospects requires separate
consideration. The fact that the income has been assessed by adopting a
reasonable estimate does not, by itself, mean that the deceased had no future
earning potential. The deceased was a young person aged about 23 years and
was earning from his occupation. His income would reasonably have been
expected to increase with passage of time. Therefore, while reassessing the
compensation, a reasonable addition towards future prospects is required to
be made.
10. Accordingly, except for the correction in the income of the deceased and
the appropriate addition towards future prospects, the other parameters
adopted by the learned Tribunal, including the deduction towards personal
expenses and the multiplier, are maintained. The compensation is
accordingly required to be reassessed.
11. In view of the foregoing discussion, this Court finds that the income of
the deceased was assessed by the learned Tribunal on the lower side. His
income is accordingly assessed at Rs.3,000/- per month, i.e. Rs.36,000/- per
annum. After deducting 1/3rd towards his personal and living expenses, the
annual loss of dependency comes to Rs.24,000/-. Considering the age of the
deceased as 23 years, the multiplier of 17 applied by the learned Tribunal is
maintained. Thus, the loss of dependency comes to Rs.4,08,000/-.
12. The deceased was a young person aged 23 years. Therefore, a reasonable
addition towards future prospects is also required to be made. Taking future
prospects at 40%, an amount of Rs.1,63,200/- is added towards future
prospects.
13. Thus, the compensation is reassessed as under:-
Head Amount
Annual income = Rs.36,000/-
Less 1/3rd towards personal expenses = Rs.12,000/-
FAFO No. 883 of 2004
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Annual loss of dependency = Rs.24,000/-
Multiplier = 17
Loss of dependency = Rs.4,08,000/-
Addition towards future prospects @ 40% = Rs.1,63,200/-
Funeral expenses = Rs.2,000/-
Loss of consortium = Rs.5,000/-
Total compensation = Rs.5,78,200/-
14. Accordingly, the appellant/claimants are entitled to a total
compensation of Rs.5,78,200/- instead of Rs.1,77,000/- awarded by the
learned Tribunal, alongwith rate of interest at the rate of 9% per annum from
the date of filing of the petition which shall be indemnified by the insurer of
the offending vehicle.
15. Accordingly, the appeal is allowed in part. The impugned award passed
by the learned Tribunal stands modified to the aforesaid extent. Except for
the aforesaid modification, the findings recorded by the learned Tribunal are
affirmed. The award shall stand modified accordingly.
16. It is further directed that if any amount has already been paid by the
Insurance Company pursuant to the award of the learned tribunal, the same
shall be adjusted towards the total amount payable under this judgment. The
Insurance Company shall deposit the enhanced amount of compensation
before the concerned tribunal within a period of two months from the date of
this order; it shall further be released by the learned tribunal within four
weeks after the deposit of the said amount in favour of the claimants/parents
and be disbursed in same proportion as held in judgment dated 18.12.2003.
(i) Claimants are hereby directed to provide their savings bank account
details, having R.T.G.S. facility, within four weeks from today to tribunal.
(ii) The said amount shall be transferred to the savings bank accounts of the
claimants by way of passing a judicial order, so that the differential amount
may be transferred directly from the account of the tribunal to the accounts
of the claimants, after completing the necessary formalities, if any.
September 3, 2026
SK
(Anil Kumar-X,J.)
Digitally signed by :-
SUSHEEL KUMAR
High Court of Judicature at Allahabad
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