New India Assurance Co. Ltd. vs Saroj And Ors. on 29 August, 2006

Madhya Pradesh High Court
New India Assurance Co. Ltd. vs Saroj And Ors. on 29 August, 2006
Author: A Gohil
Bench: A Gohil, P Jaiswal


Abhay Gohil, J.

1. The insurance company has filed this appeal under Section 173 of Motor Vehicles Act, 1988 against the award dated 24.3.2004 passed by the Sixth Additional Motor Accidents Claims Tribunal, Gwalior (M.P.) in Claim Case No. 72 of 2003 after obtaining permission for challenging the quantum.

2. Brief facts of the case are that for the death of Kamalesh Shrivastava, his legal heirs have filed claim petition before the Claims Tribunal for claiming compensation. As per the claim petition, the accident took place on 1.5.2003 when the deceased Kamalesh Shrivastava was travelling in the bus bearing No. UP 75-B 9587 from Bhind to Gwalior. The aforesaid bus was being driven by driver, respondent No. 1. It is alleged in the claim petition that respondent No. 1 was driving the bus rashly and negligently. Near Mehgaon when the driver of the bus was trying to overtake another vehicle, the bus slipped down on the kacha road and dashed with a tree. On account of this accident, the deceased received severe injuries and he was referred for treatment to Gwalior where he died on 9.5.2003. The crime was also registered. In the claim application, it was stated that the deceased was working as an assistant teacher in the Girls Primary School, Lawan District Block Ater. He was getting salary of Rs. 8,732 per month. The claim was contested on various grounds. The Tribunal considered his salary as Rs. 8,500 per month and after deducting 1/3rd amount, the Tribunal assessed the dependency of Rs. 5,666.67 per month and Rs. 68,000 per year and applied the multiplier of 15 and awarded compensation of Rs. 10,20,000. The Tribunal further awarded a sum of Rs. 14,500 under other heads and awarded the total compensation of Rs. 10,34,500, against the said award, the insurance company has filed this appeal for reducing the compensation on the ground that for computing the compensation only net salary can be taken into consideration. Cross-objection has also been filed to the effect that the income from tuitions of Rs. 2,000 per month has not been considered by the Tribunal and multiplier of 16 ought to have been applied instead of 15 and future increments have also not been considered.

3. We have heard the learned counsel for the parties, perused the findings and evidence.

4. Learned Counsel for appellant has submitted that as per the decision of the Supreme Court only net income should be considered nor the gross income and has placed reliance on the decision of the Apex Court in the case of National Insurance Co. Ltd. v. Swaranlata Das , in which the Supreme Court has held that the appropriate method of assessment of compensation is the method of capitalization of net income choosing a multiplier appropriate to the age of the deceased or the age of the dependants, whichever multiplier is lower. He has further placed reliance on a decision in the case of Asha v. United India Insurance Co. Ltd. . In this case after considering the salary certificate of the deceased as well as the deductions made therein the Supreme Court has held that the High Court was right in taking the net salary of the deceased Rs. 6,642 per month into consideration. The loss suffered by them is the amount which they would have been receiving at the time when the deceased was alive. There can be no doubt that the dependants would only be receiving the net amount less 1/3rd for his personal expenses.

5. Learned Counsel for the respondents-claimants submitted that in such cases only gross income should be considered for the purpose of compensation and he has supported the award passed by the Tribunal.

6. As argued by counsel for the parties the only question involved in this appeal is whether gross salary of the deceased should be considered for determining the compensation or the net salary and whether the amount of income from tuitions should also be considered while computing the income of the deceased.

7. We have considered the rival submissions of the learned counsel for the parties and also the ratio of the aforesaid decisions of the Supreme Court and we hold that the aforesaid decisions are binding on this Court. Thus, it is the net income which has to be considered for computing the compensation not the gross income. Therefore, in this case, as per the salary certificate, Exh. P1, the net salary of the deceased was Rs. 6,757 per month which has to be considered not the gross salary of Rs. 8,500 as has been held by Claims Tribunal. Thus, we assess the net annual income as Rs. 81,084 and after deducting 1/3rd amount as usual towards the personal expenses we assess the amount of dependency as Rs. 54,054. So far as the question of multiplier is concerned the age of the deceased was 40 years. Learned Counsel for respondents submitted that on the age group of between 35 and 40 multiplier of 16 is applicable. The Tribunal has recorded a finding that the age was more than 40 years. As per the post-mortem report his age was 41 years. The deceased was a government servant but the claimants have not filed any evidence or certificate of his date of birth to prove the age. Therefore, on the age of 41, it appears that the Tribunal has applied a proper multiplier of 15 as per the Second Schedule as for the age group between 40 and 45, the multiplier of 15 is applicable. Thus, applying the multiplier of 15, the total compensation would come to (Rs. 54,045 x 15) = Rs. 8,10,810. In addition to this amount we further allow a sum of Rs. 25,000 in various other heads like loss of consortium, loss of love and affection, loss to estate and funeral expenses, etc. Thus, the respondents-claimants are entitled for the total compensation of Rs. 8,35,810 and the amount of compensation is reduced, along with interest as awarded by the Tribunal on the amount of compensation.

8. So far as the cross-objection is concerned, it is argued by learned counsel for the respondents that the Tribunal has not considered the income of Rs. 2,000 from tuition. Legally giving tuition is not permitted to any of the government employees. Therefore, under the circumstances where any such income is not permissible, the same cannot be considered for the purpose of calculating the compensation. More so no proof has been produced on record that the deceased was earning some additional income. Deceased was posted in village school and he was living at Gwalior and attending the school daily from Gwalior to Girls Primary School, District Lawan, therefore, no time was left with him to engage himself in tuitions. Thus, we hold that he was not engaged in tuitions and not entitled for any claim on that income. So far as the question of any increment is concerned, the same is covered in the multiplier system. Therefore, we do not find any merit in the cross-objections filed on behalf of the respondent. Accordingly, the cross-objection is dismissed.

9. Thus, this appeal filed by appellant insurance company is partly allowed and the amount of compensation is reduced from Rs. 10,34,500 to Rs. 8,35,810 in the manner as indicated above.

10. Under the facts and circumstances of the case, parties are directed to bear their own costs.

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