The New India Assurance Co. Ltd. vs Kallu Bai & Ors
2012 Latest Caselaw 4977 Del

*         IN THE HIGH COURT OF DELHI AT NEW DELHI

      +     MAC.APP.No.46/2007 and CM No.954/2007

            %                          Reserved on : 13th July, 2012
                                Date of decision : 24th August, 2012

      THE NEW INDIA ASSURANCE CO. LTD.         ..... Appellant
                    Through : Mr. Pankaj Seth, Adv.

                     versus

      KALLU BAI & ORS.                      ..... Respondent
                    Through : Mr. Subhash Chechi, Adv.
                              for R-1 to 3.

CORAM :-
THE HON'BLE MR. JUSTICE J.R. MIDHA

                              JUDGMENT

1. The appellant has challenged the award of the Claims

Tribunal whereby compensation of `3,66,800/- has been

awarded to claimant/respondent Nos.1 to 3.

2. The accident dated 27th December, 1998 resulted in the

death of Raghubir. The deceased was going to his place of

work on a bicycle driven by his friend Mani Ram when he was

hit by a truck bearing No.HR-38C-5126 coming from the

opposite direction near Ashoka Farm, Bandh Road. The

deceased was survived by his widow and two children who

filed the claim petition before the Claims Tribunal. The widow

of the deceased appeared in the witness box and deposed that

the accident occurred due to the rash and negligent driving of

the offending vehicle driven by respondent No.5. The police

registered FIR No.902/98, P.S. Mehrauli, under Sections

279/337/304A IPC against respondent No.5. The widow of the

deceased placed on record the copy of FIR No.902/98, site

plan, seizure memo of the offending vehicle, post-mortem

report, insurance policy/registration certificate of the offending

vehicle and driving licence of respondent No.5. The widow of

the deceased also placed on record the copy of the statement

of the eye-witness, Mani Ram recorded by the police. Mani

Ram stated before the police that he was accompanying the

deceased on bicycle when truck bearing No.HR-38C-5126

driven rashly and negligently from the opposite side, hit the

bicycle resulting in injuries to him and the death of Raghubir.

He further stated that the accident occurred due to the rash

and negligent driving of the offending truck.

3. The claimants could not produce the eye-witness to prove

the rash and negligent driving of the offending vehicle and,

therefore, the Claims Tribunal converted the claim petition

from Section 166 of the Motor Vehicles Act to Section 163A of

the Motor Vehicles Act.

4. The deceased was aged 28 years at the time of the

accident and was working as mason. It was claimed that the

deceased was earning `3,600/- per month at the rate of `180/-

per day. However, the Claims Tribunal took the minimum

wages of `1,937 per month, added 50% towards the future

prospects, deducted 1/3rd towards the personal expenses and

applied the multiplier of 17 to compute the loss of dependency

at `3,46,800/-. `5,000/- has been awarded towards funeral

expenses and `15,000/- towards loss of love and affection. The

total compensation awarded is `3,66,800/-.

5. The learned counsel for the appellant has urged at the

time of hearing of this appeal that the Claims Tribunal erred in

converting the claim petition under Section 166 of the Motor

Vehicles Act into Section 163A of the Motor Vehicles

Act in view of specific pleading that the accident occurred due

to the rash and negligent driving of the offending vehicle by

respondent No.5. It is further submitted that the Claims

Tribunal erred in awarding future prospects to the claimants.

6. There is merit in the first contention of the appellant. In

view of the specific pleading that the accident occurred due to

the rash and negligent driving by respondent No.5 and all the

relevant documents, namely, FIR, site plan, seizure memo and

the statement of the eye-witness being on record, the Claims

Tribunal ought to have conducted an inquiry under Sections

168 and 169 of the Motor Vehicles Act. It has been held by this

Court in Mayur Arora v. Amit, 2011 (1) TAC 878 that the

Claims Tribunal has to conduct an inquiry into the claim under

Sections 168 and 169 of the Motor Vehicles Act. Instead of

converting the claim petition into Section 163 A of the Motor

Vehicles Act, the Claims Tribunal ought to have examined the

investigating officer and the eye-witness. Be that as it may, in

view of the contention raised by the appellant, the claim

petition is treated under Section 166 of the Motor Vehicles Act

and on the basis of the documents placed on record by the

claimants before the Claims Tribunal and applying the principle

of res-ipsa loquitor, it is held that the accident occurred due to

the rash and negligent driving of the offending vehicle by

respondent No.5.

7. There is no merit in the second contention raised by

learned counsel for the appellant with respect to the future

prospects awarded by the Claims Tribunal. In Santosh Devi

v. New India Assurance Company Limited, 2012 (4)

SCALE 559, the Supreme Court held that judicial notice can be

taken of the fact that the income of self-employed person as

well as ordinary skilled and unskilled labour such as barber,

blacksmith, cobbler, mason, etc., periodically increase due to

inflation and, therefore, it would be reasonable to make

addition to the income for computation of compensation. The

Supreme Court held as under:-

"14. We find it extremely difficult to fathom any rationale for the observation made in paragraph 24 of

the judgment in Sarla Verma's case that where the deceased was self-employed or was on a fixed salary without provision for annual increment, etc., the Courts will usually take only the actual income at the time of death and a departure from this rule should be made only in rare and exceptional cases involving special circumstances. In our view, it will be naïve to say that the wages or total emoluments/income of a person who is self employed or who is employed on a fixed salary without provision for annual increment, etc., would remain the same throughout his life. The rise in the cost of living affects everyone across the board. It does not make any distinction between rich and poor. As a matter of fact, the effect of rise in prices which directly impacts the cost of living is minimal on the rich and maximum on those who are self-employed or who get fixed income/emoluments. They are the worst affected people. Therefore, they put extra efforts to generate additional income necessary for sustaining their families. The salaries of those employed under the Central and State Governments and their agencies/instrumentalities have been revised from time to time to provide a cushion against the rising prices and provisions have been made for providing security to the families of the deceased employees. The salaries of those employed in private sectors have also increased manifold. Till about two decades ago, nobody could have imagined that salary of Class IV employee of the Government would be in five figures and total emoluments of those in higher echelons of service will cross the figure of rupees one lac. Although, the wages/income of those employed in unorganized sectors has not registered a corresponding increase and has not kept pace with the increase in the salaries of the Government employees and those employed in private sectors but it cannot be denied that there has been incremental enhancement in the income of those who are self-employed and even those engaged on daily basis, monthly basis or even seasonal basis. We can take judicial notice of the fact that with a view to meet the challenges posed by high cost of living, the persons falling in the latter category periodically increase the cost of their labour. In this context, it may be useful to give an example of a tailor who earns his livelihood by stitching cloths. If the cost of living increases and the prices of essentials

go up, it is but natural for him to increase the cost of his labour. So will be the cases of ordinary skilled and unskilled labour, like, barber, blacksmith, cobbler, mason etc. Therefore, we do not think that while making the observations in the last three lines of paragraph 24 of Sarla Verma's judgment, the Court had intended to lay down an absolute rule that there will be no addition in the income of a person who is self employed or who is paid fixed wages. Rather, it would be reasonable to say that a person who is self- employed or is engaged on fixed wages will also get 30 per cent increase in his total income over a period of time and if he / she becomes victim of accident then the same formula deserves to be applied for calculating the amount of compensation."

8. The learned counsel for claimant/respondent No.1 to 3

has urged that no compensation has been awarded for loss of

estate. It is further submitted that the Claims Tribunal has

awarded interest @6% per annum whereas the appropriate

rate of interest is 9% per annum.

9. The learned counsel for the appellant submits that the

claimants/respondents have not filed any cross-objections and,

therefore, the enhancement of the award amount is not

warranted. There is no merit in this contention. It is well

settled that the Appellate Court can enhance the compensation

even in the absence of cross-objections. Reference in this

regard may be made to the recent judgment of this Court in

National Insurance Company Limited v. Komal,

MANU/DE/2870/2012.

10. `10,000/- is awarded to claimants/respondents No.1 to 3

towards loss of estate. The rate of interest is enhanced from

6% per annum to 9% per annum in terms of the judgment of

the Supreme Court in Municipal Corporation of Delhi v.

Association of Victims of Uphaar Tragedy, AIR 2012 SC

100.

11. For the reasons as aforesaid, the appeal is disposed of

and the compensation awarded to claimants/respondents No.1

to 3 is enhanced from `3,66,800/- to `3,76,800/- along with

interest @ 9% per annum from the date of filing of the claim

petition till realization. The appellant has deposited 50% of the

award amount with the Claims Tribunal which has been

released to claimants/respondents No.1 to 3. The remaining

award amount in terms of this judgment be deposited by the

appellant with UCO Bank, Delhi High Court Branch by means of

a cheque drawn in the name of UCO Bank A/c Kallu Bai. Upon

the aforesaid deposit being made, the UCO Bank is directed to

release 10% of the said amount to respondent No.1 by

transferring the same to her Saving Bank Account. The

remaining amount be kept in fixed deposit in the following

manner:-

(i) Fixed deposit in respect of 10% of the amount in the

name of respondent No.1 for a period of one year.

(ii) Fixed deposit in respect of 10% of the amount in the

name of respondent No.1 for a period of two years.

(iii) Fixed deposit in respect of 10% of the amount in the

name of respondent No.1 for a period of three

years.

(iv) Fixed deposit in respect of 10% of the amount in the

name of respondent No.2 for a period of four years.

(v) Fixed deposit in respect of 10% of the amount in the

name of respondent No.2 for a period of five years.

(vi) Fixed deposit in respect of 10% of the amount in the

name of respondent No.2 for a period of six years.

(vii) Fixed deposit in respect of 10% of the amount in the

name of respondent No.3 for a period of seven

years.

(viii) Fixed deposit in respect of 10% of the amount in the

name of respondent No.3 for a period of eight

years.

(ix) Fixed deposit in respect of 10% of the amount in the

name of respondent No.3 for a period of nine years.

12. The interest on the aforesaid fixed deposits shall be paid

monthly by automatic credit of interest in the Savings Account

of respondent No.1.

13. Withdrawal from the aforesaid account shall be permitted

to the beneficiary after due verification and the Bank shall

issue photo Identity Card to the beneficiary to facilitate

identity.

14. No cheque book be issued to the beneficiary without the

permission of this Court.

15. The original fixed deposit receipts shall be retained by

the Bank in the safe custody. However, the original Pass Book

shall be given to the beneficiaries along with the photocopy of

the FDRs. Upon the expiry of the period of each FDR, the Bank

shall automatically credit the maturity amount in the Savings

Account of the beneficiaries.

16. No loan, advance or withdrawal shall be allowed on the

said fixed deposit receipts without the permission of this Court.

17. Half yearly statement of account be filed by the Bank in

this Court.

18. On the request of the beneficiaries, Bank shall transfer

the Savings Account to any other branch according to their

convenience.

19. The beneficiaries shall furnish all the relevant documents

for opening of the Saving Bank Account and Fixed Deposit

Account to Mr. M.S. Rao, AGM, UCO Bank, Delhi High Court

Branch, New Delhi (Mobile No. 09871129345).

20. The pending application stands disposed of.

21. Copy of this judgment be sent to Mr. M.S. Rao, AGM, UCO

Bank, Delhi High Court Branch, New Delhi (Mobile

No.09871129345).

J.R. MIDHA, J AUGUST 24, 2012