Madhuri Singh And 4 Others vs Hariyana Transport Corporation ...
2021 Latest Caselaw 4720 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

A.F.R.
 
Court No. - 21
 

 
Case :- FIRST APPEAL FROM ORDER No. - 3648 of 2018
 

 
Appellant :- Madhuri Singh And 4 Others
 
Respondent :- Hariyana Transport Corporation And 2 Others
 
Counsel for Appellant :- Ram Singh,Amit Kumar Singh
 
Counsel for Respondent :- Arun Kumar Shukla
 

 
Hon'ble Dr. Kaushal Jayendra Thaker,J.

Hon'ble Ajit Singh,J.

1. Heard learned counsel for the parties and perused the record.

2. This appeal challenges the award and decree though passed in favour of the claimants granting a sum of Rs.33,32,000/- from the date of filing of the claim petition till realisation with 7% simple rate of interest. The claimants have felt aggrieved as the tribunal did not grant any amount under the head of future loss of income and there is no discussion also. Why the tribunal has not followed decisions of the Apex Court in Sarla Verma Vs. Delhi Transport Corporation, (2009) 6 SCC 121 and National Insurance Company Limited Vs. Pranay Sethi and Others, 2017 0 Supreme (SC) 1050. The claimants being dissatisfied with the awarded amount preferred this appeal for enhancement of the amount of compensation.

3. The claimants moved Motor Accident Claim Petition No. 58 of 2015 before Motor Accident Claim Tribunal/Additional District Judge-7, Aligarh (hereinafter referred to as the Tribunal) claiming Rs.1,00,40,000/- as compensation at the rate of 18% rate of interest. It was averred therein that deceased was the only bread-winner of the family. He was hale and hearty and aged about 28 years at the time of accident. Facts as culled from the record are that deceased was working in Vasaka G. Engineering Company. On 9.1.2014, at about 8 am the deceased along with his brother riding on motorbike was going to the Company situated in District Faridabad and when they reached village Sikari Chauk, P.S. Sadar Ballabhgarh, District Faridabad, driver of the bus of Hariyana Transport Corporation bearing Registration No. HR 38 S 2103 dashed the motorbike as a result of which they were badly injured and in few minutes of the accident, the deceased passed away.

4. The Tribunal after recording evidence and after hearing the learned advocates for the parties, the Tribunal, vide the Judgment and award dated 18.1.2017, awarded a sum of Rs. 33,32,000/- along with 7% simple interest from the date of filing the claim petition till the date of actual payment thereof.

5. The accident is not in dispute. The vehicle being insured by the insurance company. It is also accepted that, no appeal is preferred by the insurance company, death occurred due to accidental injury is not in dispute. The only issue to be decided is, the quantum of compensation awarded.

6. Learned counsel for the appellants submitted that the Tribunal has not granted any amount under the head of Future Loss of Income and it has wrongly deducted 1/3rd amount in place of 1/4th. It is further submitted that less amount has been awarded under the heads of funeral expenses and loss of love and affection. The Tribunal further ignored loss of estate of the deceased; loss of consortium of spouse; loss of care and guidance of minor children and further it has granted less rate of interest than 12%.

7. Per contra, learned counsel for the respondent-Insurance Company submits that the quantum of compensation awarded by the Tribunal is just and proper and does not call for any interference of the Court. It is further submitted by counsel that the tribunal has not committed any error as the rate of interest is as per the Uttar Pradesh Motor Vehicles Rules, 1998 and that the deceased was in private employment and hence not entitled to future loss of income.

8. After hearing the counsel for the parties and after perusing the judgment and order impugned, the income of the deceased can be considered to be Rs.23000/- p.m. as deceased was employed in Kalkaji Engineering Company, to which as the deceased was below 40 years of age, 50% will have to be added, the reason being the decision in Pranay Sethi (supra) an no way distinguishing whether the employment in private and or government employment. All the distinguishing led is regarding employment and self employment, hence the future loss of income looking to the facts of the case also. Looking to the dependants of the deceased, deduction of 1/4 to which as children of 2 years and one of 7 months Kumari Alpana have loss their father at the time of accident, deduction towards personal expenses of the deceased should have been 1/4. As deceased was in the age bracket of 26-30, multiplier of 17 is applicable

9. Hence, the compensation payable to the appellants in view of the decision of the Apex Court in Pranay Sethi (supra) is computed as herein below:

i. Income Rs.23000/- per month

ii. Percentage towards future prospects: 50% namely Rs.11,500/-

iii. Total income: Rs.23000+11500= Rs.34,500/-

iv. Income after deduction of 1/4: Rs.25,875/-

v. Annual income: Rs.25,875 x 12= Rs.3,10,500/-

vi. Multiplier applicable:17

vii. Loss of dependency: Rs.3,10,500 x 17=Rs.52,78,500/-

viii. Amount under non pecuniary heads: Rs.70,000/-

x. Total compensation: Rs.53,48,500/-

10. As far as issue of rate of interest is concerned, it should be 7.5% in view of the latest decision of the Apex Court in National Insurance Co. Ltd. Vs. Mannat Johal and Others, 2019 (2) T.A.C. 705 (S.C.) wherein the Apex Court has held as under :-

"13. The aforesaid features equally apply to the contentions urged on behalf of the claimants as regards the rate of interest. The Tribunal had awarded interest at the rate of 12% p.a. but the same had been too high a rate in comparison to what is ordinarily envisaged in these matters. The High Court, after making a substantial enhancement in the award amount, modified the interest component at a reasonable rate of 7.5% p.a. and we find no reason to allow the interest in this matter at any rate higher than that allowed by High Court."

11. No other grounds are urged orally when the matter was heard.

12. At this stage, it has been submitted by learned counsel for the claimants that several years have elapsed, this Court may not direct deposit of said amounts in fixed deposits and though this Court has time and again directed the Insurance Companies not to deduct TDS, the same is being deducted.

13. We deem it fit to rely on the judgment of the Apex Court in the case of A.V. Padma and others Vs. R. Venugopal, 2012 (3) SCC 378 wherein the Apex Court has considered the judgment rendered in General Manager, Kerala State Road Transport Corporation, Trivandrum Vs. Susamma Thomas and others, AIR 1994 SC 1631. Paras 5 and 6 of A.V. Padma's Judgment read as under:-

"5. Thus, sufficient discretion has been given to the Tribunal not to insist on investment of the compensation amount in long term fixed deposit and to release even the whole amount in the case of literate persons. However, the Tribunals are often taking a very rigid stand and are mechanically ordering in almost all cases that the amount of compensation shall be invested in long term fixed deposit. They are taking such a rigid and mechanical approach without understanding and appreciating the distinction drawn by this Court in the case of minors, illiterate claimants and widows and in the case of semi- literate and literate persons. It needs to be clarified that the above guidelines were issued by this Court only to safeguard the interests of the claimants, particularly the minors, illiterates and others whose amounts are sought to be withdrawn on some fictitious grounds. The guidelines were not to be understood to mean that the Tribunals were to take a rigid stand while considering an application seeking release of the money. The guidelines cast a responsibility on the Tribunals to pass appropriate orders after examining each case on its own merits.

However, it is seen that even in cases when there is no possibility or chance of the feed being frittered away by the beneficiary owing to ignorance, illiteracy or susceptibility to exploitation, investment of the amount of compensation in long term fixed deposit is directed by the Tribunals as a matter of course and in a routine manner, ignoring the object and the spirit of the guidelines issued by this Court and the genuine requirements of the claimants. Even in the case of literate persons, the Tribunals are automatically ordering investment of the amount of compensation in long term fixed deposit without recording that having regard to the age or fiscal background or the strata of the society to which the claimant belongs or such other considerations, the Tribunal thinks it necessary to direct such investment in the larger interests of the claimant and with a view to ensure the safety of the compensation awarded to him. The Tribunals very often dispose of the claimant's application for withdrawal of the amount of compensation in a mechanical manner and without proper application of mind. This has resulted in serious injustice and hardship to the claimants. The Tribunals appear to think that in view of the guidelines issued by this Court, in every case the amount of compensation should be invested in long term fixed deposit and under no circumstances the Tribunal can release the entire amount of compensation to the claimant even if it is required by him. Hence a change of attitude and approach on the part of the Tribunals is necessary in the interest of justice.

6. In this case, the victim of the accident died on 21.7.1993. The award was passed by the Tribunal on 15.2.2002. The amount of compensation was enhanced by the High Court on 6.7.2006. Neither the Tribunal in its award nor the High Court in its order enhancing compensation had directed to invest the amount of compensation in long term fixed deposit. The Insurance Company deposited the compensation amount in the Tribunal on 7.1.2008. In the application filed by the appellants on 19.6.2008 seeking withdrawal of the amount without insisting on investment of any portion of the amount in long term deposit, it was specifically stated that the first appellant is an educated lady who retired as a Superintendent of the Karnataka Road Transport Corporation, Bangalore. It was also stated that the second appellant Poornachandrika is a M.Sc. degree holder and the third appellant Shalini was holding Master Degree both in Commerce and in Philosophy. It was stated that they were well versed in managing their lives and finances. The first appellant was already aged 71 years and her health was not very good. She required money for maintenance and also to put up construction on the existing house to provide dwelling house for her second daughter who was a co-owner along with her. The second daughter was stated to be residing in a rented house paying exorbitant rent which she could not afford in view of the spiralling costs. It was further stated in the application that the first appellant was obliged to provide a shelter to the first daughter Poornachandrika. It was pointed out that if the money was locked up in a nationalised bank, only the bank would be benefited by the deposit as they give a paltry interest which could not be equated to the costs of materials which were ever increasing. It was further stated that the delay in payment of compensation amount exposed the appellants to serious prejudice and economic ruin. Along with the application, the second and third appellants had filed separate affidavits supporting the prayer in the application and stating that they had no objection to the amount being paid to the first appellant.

7. While rejecting the application of the appellants, the Tribunal did not consider any of the above-mentioned aspects mentioned in the application. Unfortunately, the High Court lost sight of the said aspects and failed to properly consider whether, in the facts and circumstances of the case, there was any need for keeping the compensation amount in long term fixed deposit. "

14. Thus, it goes without saying that, in our case, the oral prayer of counsel for claimant requires to be considered as the guidelines in A.V. Padma and others (supra) was in the larger interest of the claimants. Rigid stand should now be given way. People even rustic villagers' have bank account which has to be compulsorily linked with Aadhar, therefore, what is the purpose of keeping money in fixed deposits in banks where a person, who has suffered injuries or has lost his kith and kin, is not able to see the colour of compensation. We feel that time is now ripe for setting fresh guidelines as far as the disbursements are concerned. The guidelines in Susamma Thomas (supra), which are being blindly followed, cause more trouble these days to the claimants as the Tribunals are overburdened with the matters for each time if they require some money, they have to move the Tribunal where matters would remain pending and the Tribunal on its free will, as if money belonged to them, would reject the applications for disbursements, which is happening in most of the cases. The parties for their money have to come to court more particularly up to High Court, which is a reason for our pain. Should reliance can be placed on Susamma Thomas (supra) in matters where claimants prove and show that they can take care of their money? In our view, the Tribunal may release the money with certain stipulations and that guidelines have to be followed but not rigidly followed as precedents. Recently, the Jammu and Kashmir High Court was faced with similar situation in the case of Zeemal Bano and others Vs. Insurance Company, 2020 TAC (2) 118.

15. While sitting in Single Bench of this Court, one of us (Dr. Justice Kaushal Jayendra Thaker) has held that the Insurance Company should not deduct any amount under T.D.S in the case of Smt. Sudesna and others Vs. Hari Singh and another, F.A.F.O. No.23 of 2001, decided on 26.11.2020, which should be strictly adhered to. Relevant part of the said Judgment is as under:-

" It is further orally conveyed that even if the amounts will be deposited, the Insurance company normally deducts TDS. The judgement is reviewed and at the end.

I. On depositing the amount in the Registry of the Tribunal, Registry is directed to first deduct the amount of deficit court fees, if any.

II. Considering the ratio laid down by the Hon'ble Apex Court in the case of A.V. Padma V/s. Venugopal, Reported in 2012 (1) GLH (SC), 442, the order of investment is not passed because applicants/claimants are neither not illiterate and in New India Assurance Co. Ltd. Vs. Hussain Babulal Shaikh and others, 2017 (1) TAC 400 (Bom.).

III. View of the ratio laid down by Hon'ble Gujarat High Court, in the case of Smt. Hansaguti P. Ladhani v/s The Oriental Insurance Company Ltd., reported in 2007(2) GLH 291, total amount of interest, accrued on the principal amount of compensation is to be apportioned on financial year to financial year basis and if the interest payable to claimant for any financial year exceeds Rs.50,000/-, insurance company/owner is/are entitled to deduct appropriate amount under the head of 'Tax Deducted at Source' as provided u/s 194A (3) (ix) of the Income Tax Act, 1961 and if the amount of interest does not exceeds Rs.50,000/- in any financial year, registry of this Tribunal is directed to allow the claimant to withdraw the amount (as directed in para No. II) without producing the certificate from the concerned Income-Tax Authority."

16. In view of the above, the appeal is partly allowed. Judgment and decree passed by the Tribunal shall stand modified to the aforesaid extent. The respondent-Insurance Company shall deposit the amount within a period of 12 weeks from today with interest at the rate of 7.5% from the date of filing of the claim petition till the amount is deposited.

17. In view of the above, it is directed that on deposit of the amount, the Tribunal shall disburse the entire amount by way of account payee cheque or by way of RTGS to the account of the claimants within 12 weeks from the date the amounts are deposited by the respondents. Record be sent back to the Tribunal.

Order Date: 26.3.2021

Amar Nath/Ram Murti