Andhra Pradesh High Court - Amravati

Siddinooru Aswini, vs Umesh Odapally Mahesh, on 23 October, 2024

   * THE HONOURABLE SRI JUSTICE RAVI NATH TILHARI
                                AND
           THE HONOURABLE SRI JUSTICE N.VIJAY
                      + M.A.C.M.A.NO: 2993/2017


                      %Dated:      23.10.2024
# Siddinooru Aswini and 3 others           ...... Appellants
                     and
$ Umesh Odapally Mahesh and another         ..... Respondents
! Counsel for the Appellants: Sri K.V.Raghuveer, representing Sri
                              C.Vikram Chandra,

^ Counsel for the 2nd Respondent : Sri B.Parameswara Rao


< GIST :

> HEAD NOTE :

? Cases referred :

   1. (2017) 16 SCC 680
   2. (2021) 2 SCC 166
   3. (2018) 15 SCC 654
   4. (2021) 17 SCC 148
   5. (2018) 18 SCC 130
   6. (2022) SCC OnLine SC 1683
   7. (2021) 11 SCC 780
   8. 2024 SCC OnLine SC 1901.
   9. (2015) 1 SCC 539
   10. (2015) 1 SCC 539
   11. (2021) 6 SCC 188
   12. (2021) 2 SCC 166
   13. (2022) SCC OnLine SC 1683
   14. (2020) 4 SCC 228
                                   2



    THE HONOURABLE SRI JUSTICE RAVI NATH TILHARI
                               AND
           THE HONOURABLE SRI JUSTICE N.VIJAY
                     M.A.C.M.A. NO: 2993/2017


Siddinooru Aswini and 3 others                 ...... Appellants
                   and
Umesh Odapally Mahesh and another               ..... Respondents


DATE OF ORDER PRONOUNCED:                     23.10.2024
(per Hon'ble Sri Justice Ravi Nath Tilhari)


1. Whether Reporters of Local newspapers                   Yes/No
   may be allowed to see the Judgments?


2. Whether the copies of judgment may be                   Yes/No
   Marked to Law Reporters/Journals.


3. Whether Their Lordship wishes                            Yes/No
   to see the fair copy of the Judgment?


                                              ____________________
                                               RAVI NATH TILHARI, J



                                                      ____________
                                                         N.VIJAY, J
                                 3



     THE HONOURABLE SRI JUSTICE RAVI NATH TILHARI
          THE HONOURABLE SRI JUSTICE N.VIJAY

                     M.A.C.M.A. NO: 2993/2017


JUDGMENT:

(per Hon'ble Sri Justice Ravi Nath Tilhari) Heard Sri K.V.Raghuveer, learned counsel representing Sri

C.Vikram Chandra, learned counsel for the appellants and Sri

B.Parameswara Rao, learned counsel for respondent No.2-

insurance company.

2. This appeal under Section 173 of the Motor Vehicles Act

(for short 'the M.V.Act) has been filed by the claimants for

enhancement of the amount of compensation as awarded by the

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

Guntur (in short 'the Tribunal') in M.V.O.P.No.667 of 2013 vide

awarded dated 11.07.2017.

3. The claim petition was filed by the appellants for the death

of Siddinooru Sachin (in short 'the deceased') in the motor

accident which occurred on 15.04.2013 at about 1.30 a.m. in

Veshi Tanda on NH-44 leading to Nizamabad to Hyderabad in

Duitchpalli Mandal, Nizamabad District, for compensation amount

of Rs.1,51,00,000/-. The deceased was aged about 35 years and

was working as Software Engineer in DELL International Services

India (P) Ltd., in Hyderabad. His monthly income was stated to be

Rs.65,430/-. The deceased was coming in the offending vehicle

on the date of the accident with his friend.

4. The 1st appellant/petitioner is the wife, the 2nd appellant is

the minor daughter and the 3rd appellant is father and 4th appellant

is the mother of the deceased.

5. The 1st respondent is the owner-cum-driver of the Maruti

Ritz car bearing No.AP 29 A 8430, who was said to be driven the

car rashly and negligently. The 2nd respondent-New India

Assurance Company Ltd. was the insurer of the offending vehicle.

6. The 1st respondent filed written statement denying the

averments of the claim petition but admitting that he was the

owner of the offending vehicle, which was insured with the 2nd

respondent. He denied any negligence on his part as also the

liability to pay compensation. It was pleaded that the offending

car turned turtle due to the burst of the tyre. It was also stated

that the 3rd appellant was not the dependent of the deceased as

he was retired Central Government employee, who worked in

D.R.D.O Office and was getting pension and was also doing

business. The compensation amount as claimed by the appellants

was said to be excessive.

7. The 2nd respondent-insurance company also filed written

statement denying the averments of the claim petition and also the

jurisdiction of the Tribunal in the matter and submitting further that

the claimants be put to the proof of the averments of the claim

petition.

8. The insurance company also filed additional written

statement inter alia submitting that the claimants were not entitled

to seek the enhanced compensation and the interest on such

amount, which in any case, could be only from the date of

amendment and not from the date of filing of the petition.

9. The Tribunal framed the following issues:

1. Whether the death of Siddinooru Sachin was caused by rash and negligent driving of Maruthi Car bearing No.AP 29 A 8430?

2. Whether the petitioners are entitled to compensation, if so, to what amount, and against whom?

3. To what relief?

10. The claim petitioners, in evidence, examined the first

claimant as PW.1 and one witness as PW.2 and exhibited Exs.A1

to A8 and Exs. X1 to X7 were also marked through PW.2. The

respondents did not lead any oral evidence but Ex.B1 was marked

on behalf of the 2nd respondent during cross examination of PW.2.

11. The Tribunal recorded the finding that the accident occurred

due to rash and negligent driving of the offending car of the 1st

respondent, in which the deceased received head injury and died

on the spot. The 1st respondent was the owner-cum-driver of the

offending vehicle and the 2nd respondent was the insurer. Both of

them were held jointly and severally liable to pay the

compensation.

12. On the point of quantum of compensation, the Tribunal

considered the age of the deceased as 33 years based on

Exs.A3-Charge sheet and A5-Post Mortem Certificate. As per

Ex.X6-pay slip, the Tribunal determined his gross salary as

Rs.67,305/- p.m. and out of the said amount, it deducted

Rs.10,630/-. It also deducted an amount of Rs.7,918/- shown as

holiday pay and then considered the gross salary as Rs.59,387/-

p.m. It made deductions i.e. professional tax to a tune of Rs.200/-

and income tax to a tune of Rs.7,229/- and arrived at the net

salary as Rs.51,958/- rounded to Rs.52,000/-. The Tribunal

considered the deceased as not a permanent employee in the

organization, the deceased was employed. It did not grant any

amount under the head of future prospects. The annual income

was taken as Rs.52,000/- x 12 = Rs.6,24,000/-. 1/3rd was

deducted towards personal and living expenses of the deceased.

It arrived at Rs.4,16,000/- as the loss of dependency and by

applying the multiplier '16' at age of 33 years, the

claimants/appellants were held entitled to an amount of

Rs.66,56,000/-. To the said amount, it added Rs.1,00,000/-

towards loss of consortium to the 1st claimant widow,

Rs.1,00,000/- towards loss of estate. The claimants 3 and 4 being

the parents were held entitled to a claim of Rs.50,000/- each

towards loss of love and affection and the 2nd petitioner/claimant

being minor daughter of the deceased was entitled to claim a sum

of Rs. Rs.1,00,000/- towards loss of love and affection. It also

awarded a sum of Rs.20,000/- towards funeral expenses and

thus, in total, the claim petition was partly allowed for a sum of

Rs.70,76,000/- against the claim of Rs.1,51,00,000/-. The claim

was allowed with interest at 7.5% p.a. from the date of filing of the

petition till the date of deposit of the amount by the respondents.

13. The respondents have not challenged the award. Any cross

objection has also not been filed by them.

14. Only the claimants have filed the appeal for enhancement.

15. Learned counsel for the appellants/claimants submitted that

the Tribunal has not awarded any future prospects on the

reasoning that the deceased was not the permanent employee.

He submitted that even if the deceased was not the permanent

employee, as he was in the private organization, still the future

prospects should have been granted. He further submitted that

the interest @ 7.5% is on the lower side. The Tribunal ought to

have awarded the interest at 9% p.a.

16. Learned counsel for the appellants did not dispute the

finding on the point of age, and income of the deceased as

determined by the Tribunal nor the use of multiplier of '16', applied

by the Tribunal.

17. Learned counsel for the 2nd respondent-insurance company

submitted that the future prospects have rightly not been awarded.

The petitioner was not in the permanent job and only in the private

organization. The claimants are not entitled for any amount under

the head of future prospects. He further submitted that under the

conventional heads, large amount has been awarded, which is not

as per the law.

18. No other argument was advanced.

19. We have considered the aforesaid submissions and

perused the material on record.

20. The following point arises for our consideration:

"Whether the amount as awarded by the Tribunal is not just and fair compensation and deserves enhancement? If so, what would be the amount of compensation and with what rate of interest?"

21. Future Prospects:

With respect the grant of future prospects, even if we go by

the finding that the deceased was not in the permanent job, the

claimants are entitled for awarding, the future prospects. In this

respect in National Insurance company limited v. Pranay

Sethi1 the Hon'ble Apex Court has held as under in paras 59.3

and 59.4:

"59.3. While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax.

59.4. In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25%

(2017) 16 SCC 680

where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component."

22. It is evident from para 59.4 that in case the deceased was

self employed or on a fixed salary, then an addition of 40% of the

established income should be the warrant where the deceased

was below the age of 40 years.

23. Learned counsel for the 2nd respondent-insurance company

submitted that the deceased would not be covered under the

expression 'self-employed or on a fixed salary' as in para 59.4 of

Pranay Sethi (Supra). We are not convinced with the

submission. In fact, para 59.4 deals with grant of future prospects,

in the cases where the deceased was not in a permanent job.

24. In Kirti v. Oriental Insurance Company Ltd.2, on the point

of addition of future prospects, as in that case both the deceased

were below 40 years and they could not establish to be permanent

employees, the Hon'ble Apex Court held that the future prospects

to the tune of 40% must be paid. In the said case, the argument

placed by the insurance company that no such future prospects

ought to be allowed for those with notional income was held to be

(2021) 2 SCC 166

both incorrect in law and without merit considering the constant

inflation-induced increase in wages. The Hon'ble Apex Court

quoted para 59.4 of Pranay Sethi (Supra) and also the case of

Hem Raj v. Oriental Insurance Co. Ltd.3 in para Nos.12 and 13

as under:

"III. Addition of Future Prospects:

12. Third and most importantly, it is unfair on part of the respondent insurer to contest grant of future prospects considering their submission before the High Court that such compensation ought not to be paid pending outcome of the Pranay Sethi. Nevertheless, the law on this point is no longer res integra, and stands crystalised, as is clear from the following extract of the aforecited Constitutional Bench judgment:

"59.4. In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component." [Emphasis supplied] "

13. Given how both deceased were below 40 years and how they have not been established to be permanent employees, future prospects to the tune of 40% must be paid. The argument that no such future prospects ought to be allowed for those with notional income, is both incorrect in law and without merit considering the constant inflation induced increase in wages. It would be sufficient to quote the observations of this Court in Hem Raj v. Oriental Insurance Co. Ltd.7, as it puts at rest any argument concerning non payment of future prospects to the deceased in the present case:

(2018) 15 SCC 654

"7. We are of the view that there cannot be distinction where there is positive evidence of income and where minimum income is determined on guesswork in the facts and circumstances of a case. Both the situations stand at the same footing. Accordingly, in the present case, addition of 40% to the income assessed by the Tribunal is required to be made."

[emphasis supplied] "

25. Besides, in Meena Pawaia v. Ashraf Ali 4, the deceased

was a student. It was held that the principle which applies to the

salaried person and/or deceased self-employed and/or a fixed

salaried person and/or deceased self employed and/or a fixed

salaried deceased, applies to the deceased who was not serving

and/or was not having any income at the time of accident. In the

said case, which was a case of the death of the student, the

Hon'ble Apex Court applied para No.59.4 of Pranay Sethi (Supra)

and awarded 40% of the income, determined as future prospects.

Para Nos.13 to 16 are as follows:

" We see no reason why the aforesaid principle may not be applied, which apply to the salaried person and/or deceased self-employed and/or a fixed salaried person and/or deceased self employed and/or a fixed salaried deceased, to the deceased who was not serving and/or was not having any income at the time of accident/death. In case of a deceased, who was not earning and/or not doing any job and/or self-employed at the time of accident/death, as observed herein above his income is to be determined on the guess work looking to the circumstances narrated hereinabove. Once such an amount is arrived at he shall be

(2021) 17 SCC 148

entitled to the addition over the future prospect/future rise in income. It cannot e disputed that the rise in cost of living would also affect such a person.

14. As observed by this Court in Pranay Sethi, the determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as postulated under Section 168 of the Motor Vehicles Act. In case of a deceased who had held a permanent job with inbuilt grant of annual increment and/or in case of a deceased who was on a fixed salary and /or self employed would only get the benefit of future prospects and the legal representatives of the deceased who was not serving at the relevant time as he died at a young age and was studying, could not be entitled to the benefit of the future prospects for the purpose of computation of compensation would be inapposite. Because the price rise does affect them also and there is always an incessant effort to enhance one's income for sustenance.

15. It is not expected that the deceased who was not serving at all, his income is likely to remain static and his income would remain stagnant. As observed in Pranay Sethi (Supra) to have the perception that he is likely to remain static and his income to remain stagnant is contrary to the fundamental concept of human attitude which always intends to live with dynamism and move and change with the time. Therefore we are of the opinion that even in case of a deceased who was not serving at the time of death and had no income at the time of death, their legal heirs shall also be entitled to future prospects by adding future rise in income as held by this court in the case of Pranay Sethi (supra) i.e. addition of 40% of the income determined on guesswork considering the educational qualification, family background etc., where the deceased was below the age of 40 years."

26. Accordingly, we are of the view that the deceased being

below the age of 40 years and in the private organization would be

covered under para 59.4 of Pranay Sethi (Supra). The claimants

are therefore entitled for 40% of the established income towards

future prospects.

27. Conventional heads:

Under this head, and different sub-heads, the Tribunal

awarded total amount of Rs.4,20,000/-. The same is in excess and

not as per the settled law. Accordingly, we reduce the amount

under the conventional heads as granted by the Tribunal and

award as per the law laid down in the judgments, in Pranay Sethi

(supra) Magma National Insurance Company Limited vs

Nanu Ram @ Chuhru Ram and Ors.,5Smt. Anjali and Others V.

Lokendra Rathod and Others,6United India Insurance Co. Ltd.

vs. Satinder Kaur @ Satwinder Kaur and Ors., 7and Rojalini

Nayak and Others vs Ajit Sahoo and Others 8 we award the

amounts under the Conventional Heads, for loss of Consortium,

loss of Estate and funeral expenses, as Rs.48,400/- (per

claimant), Rs.18,150/- and Rs.18,150/- respectively as was

awarded in Rojalini (Supra), which is with an increase of 10%

every three years.

28. The Claimants are thus entitled for the following amount as

just and fair compensation :-

(2018) 18 SCC 130

(2022) SCC OnLine SC 1683

(2021) 11 SCC 780

2024 SCC OnLine SC 1901.

       S.                         Head                  Compensation
       No.                                                Awarded

           1.            Net Annual Income               Rs. 52,000/- x 12 = Rs.
                        (As per the Tribunal)                  6,24,000/-

           2.               Future Prospects                   Rs. 2,49,600/-
                                                        (i.e., 40% of the income)
                                                           Total (i.e., 1+2) = Rs.
                                                                 8,73,600/-

           3.        Deduction towards personal              Rs. 2,91,200/-
                            expenditure
                             (i.e.1/3rd)

           4.               Total Annual loss                Rs. 5,82,400/-

5. Multiplier of 16 for the age of 33 16 x Rs. 5,82,400/- = Rs.

                                years i.e.                    93,18,400/-

           6.          Conventional Heads:

     i)          Loss of Consortium                          Rs. 1,93,600/-
                                                           (Rs. 48,400/- x 4)

     ii)         Loss of Estate                               Rs. 18,150/-

     iii)        Funeral expenses                             Rs. 18,150/-

           7.           Total Compensation                  Rs. 95,48,300/-

29. Consequently, the compensation amount granted by the

Tribunal is enhanced from Rs.70,76,000/- to Rs. 95,48,300/-.

30. Interest:

So far as the award of interest is concerned, the Tribunal

granted interest at the rate of @ 7.5% p.a. In Kumari Kiran vs.

Sajjan Singh and others9, the Hon'ble Apex Court set aside the

(2015) 1 SCC 539

judgment of the Tribunal therein awarding interest @ 6% as also

the judgment of the High Court awarding interest @7.5% and

awarded interest @ 9% p.a. from the date of the claim petition. In

Kumari Kiran vs. Sajjan Singh 10 , the Hon'ble Apex Court set

aside the judgment of the Tribunal therein awarding interest @ 6%

as also the judgment of the High Court awarding interest @7.5%

and awarded interest @ 9% p.a. from the date of the claim

petition. In Rahul Sharma vs. National Insurance Company

Limited11, the Hon'ble Apex Court awarded @ 9% interest p.a.

from the date of the claim petition. In Kirthi vs. Oriental

Insurance Company Limited12 and in Smt. Anjali vs. Lokendra

Rathod13 also the Hon'ble Apex Court referring to Malarvizhi vs.

United India Insurance Co. Ltd.14, allowed interest @ 9% p.a.

allowed interest @ 9% p.a. We allow interest @9% p.a.