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Summary of Legal Opinion — MVC No. 6168/2007

Factual and Procedural Background

This is an appeal by the claimants against the judgment and award dated 18-08-2008 passed in MVC No. 6168/2007 by the XIV Additional Judge, Court of Small Causes, Motor Accident Claims Tribunal, Bangalore (SCCH.10). The claimants (appellants) are the wife, children and parents of the deceased, Late Sri H.S. Ravi, who died following injuries sustained in a road traffic accident on 14-12-2006 near Marulasiddaiahna Palya Gate on N.H.48 Kunigal-Bangalore Road. The deceased was a pillion rider on a motorcycle and, after admission to hospital, succumbed to his injuries on 20-12-2006.

The claim petition was filed under Section 166 of the Motor Vehicles Act claiming Rs. 33,90,000/-. The Tribunal awarded Rs. 7,85,000/- with interest at 6% p.a. from the date of petition till realization. The appellants sought enhancement of compensation, and this appeal challenges the quantum awarded by the Tribunal.

Legal Issues Presented

  1. Whether the quantum of compensation awarded by the Tribunal is just and reasonable?

Arguments of the Parties

Appellants' Arguments

  • The Tribunal erred in awarding inadequate compensation for loss of dependency and conventional heads; the award requires enhancement.
  • The Tribunal erred in not awarding full medical expenses; appellants claimed Rs. 1,82,150/- but the Tribunal awarded only Rs. 1,00,000/-.
  • The deceased was an income-tax assessee and had filed returns for assessment years 2005-06 and 2006-07 showing incomes of Rs. 1,08,713/- and Rs. 2,02,911/-, respectively; appellants provided calculations based on these figures to establish the deceased's income for loss of dependency computation.

Respondent / Insurer's Arguments

  • The impugned judgment and award was passed after due consideration of oral and documentary evidence and does not call for interference by this Court.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
SARLA VERMA v. DELHI TRANSPORT CORPORATION LTD., reported in 2009 ACJ 1298 Deduction of one-fourth (1/4) of the deceased's income towards personal expenses when calculating dependency where multiple dependants exist. The court applied the 1/4 deduction towards personal expenses because there were six claimants; after applying this deduction the remaining income was used to compute loss of dependency.

Court's Reasoning and Analysis

The court proceeded by accepting the occurrence of the accident, the deceased's age (about 45 years), and that the deceased was an income-tax assessee who filed returns for assessment years 2005-06 and 2006-07. The court relied on the gross total incomes shown in Ex.P36: Rs. 1,08,713/- and Rs. 2,02,911/- respectively, totaling Rs. 3,11,624/-, and computed an average annual income of Rs. 1,55,812/-.

From that average the court deducted 10% as income tax (Rs. 15,581/-) to arrive at Rs. 1,40,231/-, and further deducted professional tax of Rs. 2,400/-, resulting in Rs. 1,37,831/-. The court then deducted Rs. 20,000/- shown as income from house property for 2006-07, producing a net of Rs. 1,17,831/-. Applying the principle from SARLA VERMA, the court deducted one-fourth (1/4) for personal expenses because there were six claimants; after this deduction the remaining annual dependency amount was Rs. 88,373/-.

The court identified the appropriate multiplier as 14 (deceased aged about 45 years) and multiplied the post-deduction annual dependency (Rs. 88,373/-) by 14 to re-determine loss of dependency at Rs. 12,37,222/-, in place of the Tribunal's award of Rs. 6,50,000/-. For conventional heads (loss of estate, love and affection, consortium, transportation of dead body and funeral expenses) the court awarded Rs. 45,000/-.

Regarding medical expenses, after reviewing original records and medical bills, and noting the parties' fair submission, the court concluded the appellants were entitled to Rs. 1,87,150/- towards medical treatment (increased from the Tribunal's Rs. 1,00,000/- award).

Combining the re-determined heads, the court fixed total compensation at Rs. 14,69,372/-, which meant an enhancement of Rs. 6,84,372/- over the Tribunal's award. Interest at 6% per annum was ordered from the date of filing of the claim petition until realization.

The court then specified directions for payment and deposit of the enhanced amount by the second respondent (Insurer), including timed deposits and fixed deposit instructions for particular appellants with specified sums, tenors and withdrawal liberties.

Holding and Implications

The appeal is allowed in part. The court modified the impugned judgment and award dated 18-08-2008 by awarding enhanced compensation.

Holding: ENHANCED COMPENSATION OF Rs. 6,84,372/- (in addition to the original award) WITH INTEREST AT 6% P.A. FROM THE DATE OF FILING OF THE CLAIM PETITION TILL REALIZATION.

Direct consequences and directions ordered by the court (as stated in the opinion):

  • The second respondent (Insurer) is directed to deposit the enhanced compensation of Rs. 6,84,372/- with interest at 6% p.a. within three weeks from receipt of the judgment.
  • Out of the enhanced amount:
    • Rs. 2,00,000/- with proportionate interest to be invested in a Fixed Deposit in the name of the first appellant for 10 years (renewable for another 10 years) with liberty to withdraw interest periodically.
    • Rs. 50,000/- each with proportionate interest to be invested as Fixed Deposits in the names of appellants 5 and 6 for 5 years (renewable for another 5 years) with liberty to withdraw interest periodically.
    • Rs. 1,00,000/- with proportionate interest to be deposited in the name of appellant 4 in Fixed Deposit for 30 years, with interest withdrawal arrangements as specified.
    • Rs. 50,000/- each with proportionate interest to be invested in the names of appellants 2 and 3 for 10 years (renewable for another 10 years) with liberty to withdraw interest periodically.
    • The remaining Rs. 1,84,372/- with proportionate interest to be released in favour of the first appellant and appellant No. 6 in equal proportion immediately on deposit by the Insurer.

Implications: The decision adjusts the Tribunal's award upward by applying accepted principles (income averaging from tax returns, statutory deductions, the Sarla Verma deduction for personal expenses, and the appropriate multiplier for age). The opinion implements specific payment and investment directions for protection of dependants' interests. The opinion does not purport to create a new precedent; it applies existing legal principles and an earlier decision (SARLA VERMA) to the facts before the court.

Office direction: The court directed the office to draw the award accordingly.

    Shashikala v. Gangalakshmamma

    1. This is claimants appeal filed against the impugned judgment and award dated 18-08-2008 passed in MVC No. 6168/2007 on the file of the IVX Additional Judge, Court of Small Causes, Motor Accident Claims Tribunal, Bangalore (SCCH.10) (hereinafter referred to as ‘the Tribunal’) seeking enhancement of compensation.

    2. The Tribunal by its judgment and award awarded a sum of Rs. 7,85,000/- with interest at 6% p.a from the date of petition till the date of deposit, on account of death of the deceased, in the road traffic accident.

    3. The brief facts of the case are:

    4. Appellant No. 1 is the wife, appellants 2 to 4 are children and appellants 5 and 6 are the parents of the deceased Late Sri. H.S Ravi and they have filed a claim petition under Section 166 of the Motor Vehicles Act claiming compensation of Rs. 33,90,000/- on account of death of the deceased in the road traffic accident contending that the deceased met with an accident on the ill-fated day i.e on 14-12-2006 at about 11.00 p.m on N.H.48 Kunigal-Bangalore Road near Marulasiddaiahna Palya Gate within the limits of Nelamangala Police Station, due to the rash and negligent driving by the driver of the bus. The deceased was a pillion rider in the motorbike bearing registration No. KA-03.EX-4147. Due to the accident, the deceased sustained grievous injuries. Immediately, he was admitted to the hospital. However, after six days of the accident, the deceased succumbed to injuries. In spite of providing all medications, he could not be saved and he died on 20-12-2006. On account of untimely death of the deceased, the claimants filed a claim petition against the owner and Insurer of the vehicle.

    5. The appellants have contended that the deceased was aged about 45 years, doing transport business of supplying the newspapers from one destination to another. Further contended that he was hale and healthy prior to the accident. He was paying tax and has filed income tax returns and he is the only earning member of the family. On account of untimely death of the deceased, the wife has lost her husband, appellants 2 to 4 have lost their father's love and affection, inspiration and guidance at the young age and appellants 5 and 6, parents of the deceased have lost their son who was their security and aspiration and their future is jeoparadised. Due to the untimely death of the deceased, the social and economic condition of the family is affected. Further contended that the deceased had filed income tax returns, showing the gross income as Rs. 1,08/713/- for the assessment year 2005-06 and Rs. 2,02,911/- for the assessment year 2006-07. Taking all these factors into consideration, the claimants filed the claim petition seeking compensation.

    6. The said matter had come up for consideration before the Tribunal. The Tribunal in turn, after appreciating the oral and documentary evidence and other relevant materials available on file, has allowed the claim petition in part and awarded the compensation of Rs. 7,85,000/- under different heads, with interest at the rate of 6% p.a from, the date of filing of the claim petition till realization. Being dissatisfied with the compensation awarded by the Tribunal, the appellants have presented this appeal for enhancement of compensation.

    7. We have heard the learned counsel appearing for the appellants and respondents.

    8. The submission of the learned counsel appearing for the appellants is that the Tribunal has erred in not awarding reasonable compensation towards loss of dependency and conventional heads and what is awarded is very meager and requires to be enhanced. Further, the Tribunal has also erred in not awarding the medical expenses in full amounting to Rs. 1,82,150/- and what is awarded is only Rs. 1,00,000/-. It is further submitted that the deceased was an income tax assessee and was paying income tax. He has also filed income tax returns for the assessment years 2005-06 and 2006-07 showing the total income as Rs. 1,08,713/- and Rs. 2,02,911/- respectively. The total amount works out to Rs. 3,11,624/- and the average works out to Rs. 1,55,812/- out of which, professional tax of Rs. 2,400/- has to be deducted.

    9. As against this, Sri. A.N Krishna Swamy, learned counsel appearing for the Insurer, inter alia, contended that impugned judgment and award was passed by the Tribunal after due consideration of the oral and documentary evidence and other materials available on file and the same does not call for interference by this Court.

    10. After careful consideration of the submissions made by the learned counsel appearing for both the parties and on perusal of the materials available on record, including the impugned judgment and award passed by the Tribunal, the only point that arise for consideration in this appeal is:

    Whether the quantum of compensation awarded by the Tribunal is just and reasonable?

    11. Occurrence of the accident resulting in the death of deceased in the road traffic accident is not in dispute. Further, it is not disputed that the deceased was aged about 45 years as on the date of the accident and was doing transport business of supplying newspapers from the Head Office to other destinations as per the agreement entered into between the Corporate of Newspapers and himself. It is also not in dispute that the deceased was an income tax assessee and he has filed income tax returns for the assessment years 2005-06 and 2006-07. The deceased met with an accident on 14-12-2006 and sustained grievous injuries. Inspite of giving all medications, he could not be saved. The deceased succumbed to injuries after six days of the accident and the appellants have spent huge amount towards, conveyance, attendant charges, medical bills etc. As rightly pointed out by the appellants, the deceased had filed income tax returns as per Ex.P36, for the assessment years 2005-06 and 2006-07 with gross total income of Rs. 1,08,713/- and 2,02,911/- respectively, including the income from house property. The total of both the years comes to Rs. 3,11,624/-. Average of it comes to Rs. 1,55,812/-. If 10% of the said amount i.e, Rs. 15,581/- is deducted towards income tax., the remaining amount comes to Rs. 1,40,231/-. Further, Rs. 2,400/- has to be deducted towards professional tax and the net amount comes to Rs. 1,37,831/-. Out of which, income from the house property is shown as Rs. 20,000/- for the assessment year 2006-07. Therefore, the said amount should be deducted out of the said income and the net amount comes to Rs. 1,17,831/-. Since the claimants are 6 in number, viz wife, children and parents of the deceased. 1/4 should be deducted towards personal expenses as per the decision in the case of SARLA VERMA v. DELHI TRANSPORT CORPORATION LTD., reported in 2009 ACJ 1298, after deduction of which, the remaining amount comes to Rs. 88,373/-. The deceased was aged about 45 years and the appropriate multiplier to be adopted is 14. Accordingly, we re-determine the loss of dependency at Rs. 12,37,222/- as against Rs. 6,50,000/- and accordingly, it is awarded.

    12. Having regard to the facts and circumstances of the case, we deem it fit to award Rs. 45,000/- towards conventional heads such as, loss of estate, loss of love and affection, loss of consortium, transportation of dead body and funeral expenses. The Tribunal has erred in awarding only Rs. 1,00,000/- towards medical expenses. However, after going through the original records and the medical bills, learned counsel for both the parties fairly submitted that the appellants are entitled to a sum of Rs. 1,87,150/- towards medical expenses as per the medical bills. In the light of the submission made by the learned counsel appearing for both the parties and having regard to the medical bills produced by the appellants, we deem fit to award a sum of Rs. 1,87,150/- as against Rs. 1,00,000/- awarded by the Tribunal. The appellants are entitled to total compensation of Rs. 14,69,372/- as against Rs. 7,85,000/- awarded by the Tribunal. There will be enhancement of Rs. 6,84,372/- with interest at 6% from the date of petition till realization.

    13. Having regard to the facts and circumstances of the case as stated above, the appeal filed by the appellants is allowed in part and the impugned judgment and award dated 18-08-2008 in Court of Small Causes, MVC No. 6168/2007 passed by the XIV Addl. Judge, Court of Small Causes, MACT, Bangalore, (SCCH. No. 10) is modified by awarding enhanced compensation of Rs. 6,84,372/- with interest at the rate of 6% p.a from the date of filing of the claim petition till realization.

    14. The second respondent-Insurer is directed to deposit the enhanced compensation of Rs. 6,84,372/- with interest at 6% p.a from the date of petition till realization, within three weeks from the date of receipt of a copy of this judgment.

    15. Out of the enhanced compensation, Rs. 2,00,000/- with proportionate interest shall be invested in the Fixed Deposit in any Nationalised or Scheduled Bank in the name of the first appellant for a period of 10 years and renewable for another ten years, with liberty to her to withdraw the interest accrued on it periodically.

    16. Rs. 50,000/- each with proportionate interest shall be invested in the Fixed Deposit in any Nationalized or Scheduled Bank in the name of appellants 5 and 6 for a period of 5 years renewable for another 5 years with liberty to them to withdraw the interest periodically.

    17. Rs. 1,00,000/- with proportionate interest shall be deposited in the name of the 4 appellant in the Fixed Deposit in any Nationalized or Scheduled Bank for a period of 30 years with liberty to the first appellant to withdraw the interest accrued on it periodically till the 4 appellant attains the age of 21 years and from 22 years to 30 years, he is entitled to withdraw the interest periodically.

    18. Rs. 50,000/- each with proportionate interest shall be invested in the name of appellants 2 and 3 for a period of 10 years renewable for another 10 years with liberty to them to withdraw the interest periodically.

    19. The remaining amount of Rs. 1,84,372/- with proportionate interest shall be released in favour of the first appellant and appellant No. 6, in equal proportion, immediately, on deposit by the Insurer.

    20. Office is directed to draw the award, accordingly.

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    Shashikala v. Gangalakshmamma
    (Jul 15, 2013)