Andhra Pradesh High Court - Amravati

United India Insurance Company ... vs Palusani Lakshmamma And 3 Others on 14 November, 2022

Bench: U.Durga Prasad Rao, Gannamaneni Ramakrishna Prasad

      HON'BLE SRI JUSTICE U.DURGA PRASAD RAO
                        AND
HON'BLE SRI JUSTICE GANNAMANENI RAMAKRISHNA PRASAD

            M.A.C.M.A. Nos.429 of 2018 and 3196 of 2018

 COMMON JUDGMENT: (Per Hon'ble Sri Justice U.Durga Prasad Rao)

       M.A.C.M.A No. 429 of 2018 and 3196 of 2018 are filed by the

 Insurance Company and claimants respectively challenging the

 judgment dated 18.08.2017 in M.V.O.P.No.110/2014 passed by the

 Motor Accidents Claims Tribunal-cum-III Additional District Court,

 Kurnool at Nandyal granting compensation of Rs.34,57,872/- against

 the claim of Rs.45,00,000/- for the death of one Palusani Dasthagiri

 Reddy in a motor bike accident.


 2.    The claimants are the wife, minor daughter and son of the

 deceased who filed MVOP No.110/2014 against the owner and insurer

 of the offending motor bike bearing registration No.AP-21-AF-8623

 which was partly decreed against both the respondents. Hence both

parties filed the above appeals. Since both the appeals arose out of the

same MVOP, they are disposed of by this common judgment.

3. Parties in these appeals are referred to as they are arrayed in

M.V.O.P.No.110/2014.

4. Heard arguments of Sri Vutla Srinivasa Rao, learned counsel for

insurance company/ appellant in MACMA No.429/2018 and Sri A.

Jaya Sankara Reddy, learned counsel for claimants/appellants in

MACMA No.3196/2018.

5. Severely fulminating the judgment of the lower tribunal, Sri

Vutla Srinivasa Rao, learned counsel for insurance company/appellant

in M.A.C.M.A.No.429/2018 would firstly argue that the involvement

of motor bike baring No. AP-21-AF-8623 in the accident is highly

doubtful because as per the version of claimants, on the night of

27.06.2013 when the deceased was proceeding from Allagadda to

Chintagunta Village on the offending motor bike as pillion rider driven

by his own brother-in-law who is the owner of the motor bike, the said

vehicle allegedly fell in a ditch and thereby the deceased sustained

head injury and died on 01.07.2013 while undergoing treatment in the

Military Hospital at Bengaluru. Learned counsel would argue that if

the said version is true, the 1st respondent who is the own brother-in-

law of deceased ought to have reported the accident to police on the

same date of accident. However, he lodged Ex.A1- FIR only on

01.07.2013 i.e., after the death of the deceased. It indicates that the

deceased must have died in a different accident caused by an unknown

vehicle but in order to claim compensation, case was registered against

the vehicle of 1st respondent. Hence the tribunal ought to have

exonerated the insurance company.

6. Nextly he argued that the tribunal awarded a high compensation

of Rs.31,99,872/- under head "Loss of Income" by taking the monthly

income of deceased as Rs.25,000/- and applying multiplier 16. In this

context, the tribunal ignored the evidence of PW3 who stated that the

deceased was a military employee whose service period would be

about 15 years. As per Ex.A1-FIR the deceased already completed 10

years of military service and therefore he was left with only five years

of service by the date of accident. In that view, the deceased during the

remaining five years of his service would have earned Rs.15 lakhs

(25,000 X 12 X 5) and contributed net amount of Rs.10 lakhs only,

having regard to the fact that the tribunal accepted his monthly salary

as Rs.25,000/-. However, the tribunal committed gross error in taking

multiplier 16 and multiplying the same with his annual income of

Rs.1,99,992/- to arrive at the exorbitant figure of Rs.31,99,872/-. He

further argued that the tribunal failed to deduct income tax from the

annual income of the deceased. By that count also, the compensation

was unduly hiked. He further argued that the compensation granted

under other heads is on higher side and the same should have been

restricted to the extent mentioned in the decision National Insurance

Company Limited vs. Pranay Sethi and others1. He thus prayed to

allow the appeal.

7. Per contra, Sri A. Jaya Sankara Reddy, learned counsel for

appellants/claimants argued that the crime vehicle was indeed involved

in the accident and merely because the police report was given with a

delay of four days, it cannot be contended otherwise. He argued that

the police after investigation laid charge sheet against the crime vehicle

which indicates that the said vehicle was very much involved in the

accident. He further argued that PW2 the eye witness has clearly

deposed about the manner of occurrence of accident and involvement

of the motor bike bearing No. AP-21-AF-8623 in the said accident.

AIR 2017 SC 5157 = MANU/SC/1366/2017

Therefore, it cannot be argued that the motor bike was not involved in

the accident. Nextly he argued that the tribunal has not correctly

assessed the compensation, inasmuch as, though as per the evidence of

PW3 and Ex.C1-salary certificate, the net salary of deceased was

Rs.29,140/-, still the tribunal wrongly fixed his monthly salary as

Rs.25,000/- . Further, the tribunal failed to add future prospects to his

salary and thereby compensation was drastically reduced. It is also

argued that the tribunal has not taken into consideration the medical

bills. He thus prayed to allow the appeal and award the compensation

as prayed for.

8. The points for consideration in these appeals are:

(1) Whether the motor bike bearing registration No. AP-21-AF-

8623 was not involved in the accident as claimed by the insurance

company?

(2) Whether the compensation awarded by the lower tribunal is

just and reasonable or requires re-assessment?

9. POINT No.1 We gave our anxious consideration to the above

arguments. On perusal of the record, we are unable to accept the

argument of the counsel for insurance company that the motor bike

was not involved in the accident. PW2 who is an eye witness to the

accident has clearly deposed that on 27.06.2013 at 8:45 PM when the

motor bike bearing registration No.AP-21-AF-8623 belongs to the 1st

respondent reached near Injeti Krishna Reddy's home the 1st

respondent drove the vehicle at high speed and in a rash and negligent

manner without observing the unevenness of the road and thereby the

deceased who was the pillion rider, fell on the road and received

grievous injuries. He thus asserted that the crime vehicle was indeed

involved in the accident. In the cross-examination he stated that he

observed the accident at a distance of ten feet from his house. He

denied the suggestion that he is a close relative of the deceased and he

was speaking falsehood. Except giving such a suggestion which was

denied, nothing specific could be elicited to disprove the veracity of

PW2. It should be noted that PW2 was cited as an eye witness (LW3)

in the charge-sheet. Thus his evidence clinches the issue. That apart,

the police too after investigation laid charge sheet against the 1st

respondent. In our view the tribunal has rightly held that the crime

vehicle was indeed involved in the accident and the 1st respondent was

guilty. Accordingly, we answer this point in favour of claimant and

against the insurance company.

10. POINT No.2 Regarding this point, while it is the contention of the

insurance company that the tribunal has fixed the high compensation,

the complainants in turn argued that the tribunal granted very low

compensation. Hence we verified the record.

11. So far as occupation and earnings of the deceased are concerned,

a perusal of the evidence of PW3 who is working as Assistant

Controller of Defence Accounts, PAO, (ORS), AAD, coupled with

Ex.C1-salary certificate would show that the deceased was working as

Havaldar in the Indian Army and was drawing gross salary of

Rs.37,179/- and a net salary of Rs.29,140/-. PW3 stated that generally

the service of the army persons will be 15 years. However, he added

that if a person wants to continue his service in army, he can continue

as per the army rules relating to terms of engagement. Basing on the

Ex.A1-FIR wherein it was mentioned that the deceased already put up

10 years service in army, it is argued by learned counsel for insurance

company that the left over service is only 5 years and hence even if the

deceased is alive, his contribution to his family would be for that

period only and hence selection of multiplier of 16 on the basis of his

age is incorrect. We are unable to accept this argument for the reason

that PW3 though stated that generally the service of army persons will

be 15 years, however he further stated one can continue in the service

as per the army rules concerning the terms of engagement. Therefore,

in our view the said general rule cannot be rigidly applied in every

case. We do not know whether the deceased would have continued his

employment beyond 15 years had he been alive. Even assuming that

the deceased worked for 15 years only in the Indian Army that does not

mean that after serving the Army he will remain idle and will not

engage in any gainful employment as he was only 34 years old by the

time of his death as per Ex. A6- school certificate. So we cannot

accept the argument that the deceased would have contributed amount

for five years only had he alive and thereby compensation should be

calculated on that premise. The tribunal was right in selecting

multiplier 16 basing on his age by following the decision in Sarla

Verma v. Delhi Transport Corporation2 .

(a) Now coming to the earnings of the deceased, his net salary

was Rs.29,140/-. However, the tribunal erroneously fixed his income

2009 ACJ 1298

as Rs.25,000/- per month on the ground that there were no correct

service particulars of the deceased. When the unrebutted salary

particulars are available, that should be the basis for fixing his income

in our considered view. So we accept his net salary for fixing the

compensation under the head "loss of earnings". The annual income of

the deceased will be Rs.3,49,680/- (Rs.29,140 X 12). From this

income tax as applicable for the financial year 2012-13 has to be

deducted. Income up to Rs.2,00,000/- is exempted and on balance

income of Rs.1,49,680/-, 10% tax is deducted. Thus the net annual

earnings of deceased comes to Rs.3,34,712/-.

(b) As rightly argued by the claimants, the tribunal failed to add

future prospects to the income of the deceased. As per Pranay Sethi

(1 supra), an addition of 50% of the actual salary is to be made towards

future prospects when the deceased was below 40 years of age. Hence

a sum of Rs.1,67,356/- (50% of Rs.3,34,712/-) is added and thereby the

annual earnings of the deceased comes to Rs.5,02,068/-. From this

1/3rd is deducted towards personal living expenses of the deceased.

The balance amount comes to Rs.3,34,712/-. The said amount is

multiplied with the multiplier 16. Thus the compensation for loss of

earnings comes to Rs.53,55,392/-. Then following the Pranay Sethi,

(1 supra) a sum of Rs.15,000/- for loss of estate, Rs.40,000/- for loss of

consortium and Rs.15,000/- for funeral expenses are awarded.

the claimants is that the tribunal has not granted compensation for the

medical expenditure of Rs.2 lakhs incurred by them in Surya Hospital,

Kurnool and later in the Military Hospital, Bangalore where the

deceased was treated. We find no much force in this argument. In

para-12 of the judgment the lower tribunal having considered the

essentiality certificate and medical bills under Ex.P5, granted

Rs.18,000/-. However, since there was no evidence that the claimants

incurred any expenditure in the Military Hospital, Bangalore, discarded

the rest of the claim. We find no reason to differ with.

(d) Thus the total compensation payable to the claimants is as

follows:

       (i) Loss of earnings                  =   Rs.53,55,392=00
      (ii) Loss of estate                    =   Rs. 15,000=00
     (iii) Loss of consortium                =   Rs. 40,000=00
     (iv) Funeral expenses                   =   Rs. 15,000=00
     (v) Medical expenses                    =   Rs. 18,000=00
     (vi) Transport charges                  =   Rs. 20,000=00
                                TOTAL        =   Rs. 54,63,392=00
                                                    -------------------

Thus the claimants are entitled to a total compensation of

Rs.54,63,392/- with proportionate costs and interest at 7.5% p.a from

the date of MVOP till the date of realization. It is needles to

emphasize that in deserving cases, the Court can award more

compensation than claimed by the claimants vide Nagappa v.

Gurudayal Sing3 and Ningamma v. United India Insurance Co.

Ltd.,4

12. In the result:

(i) MACMA No.429/2018 filed by the insurance company is

dismissed.

(ii) MACMA No.3196/2018 filed by the claimants is allowed

and compensation awarded by the lower tribunal is

enhanced from Rs. 34,57,872/- to Rs. 54,63,392/- with

proportionate costs and simple interest at 7.5% p.a from

the date of MVOP till the date of realization. The

insurance company shall deposit the compensation

amount within two months from the date of this common

judgment failing which, the claimants will be at liberty to

MANU/SC/11/1107/2002 = 2003 (2) SCC 274

MANU/SC/0802/2009 = 2009 (13) SCC 710

take out execution against the owner and insurance

company of the offending motor bike. The claimants have

to deposit the Court fee on the differential compensation

within four (4) weeks and thereafter the Registry shall

issue certified copies of common judgment to them.

As a sequel interlocutory applications, if any pending,

shall stand closed.