National Insurance Co. Ltd. vs Shalu Saxena & Ors.
2017 Latest Caselaw 2510 Del

$~R-1
*     IN THE HIGH COURT OF DELHI AT NEW DELHI

%                                            Decided on: 18th May, 2017

+                        MAC. APP. 327/2014

       NATIONAL INSURANCE CO. LTD.             ..... Appellant
                    Through: Mr. L.K. Tyagi, Adv.

                          Versus

       SHALU SAXENA & ORS.                               .....Respondents

                   Through:           Mr. Arvind Kr. Pandey, Adv.

CORAM:
HON'BLE MR. JUSTICE NAJMI WAZIRI

NAJMI WAZIRI, J (Oral)

1. The appellant has impugned the Award dated 31.01.2014 in MAC Petition No. 626 of 2011 in favour of the LRs of the deceased i.e. respondent No. 1 to 4. During the pendency of this appeal, R-1 passed away and is survived by his son R-4 and his parents R-2 and R-3. 70% of the share of his compensation was released to R-1 during his lifetime.

2. The appellant contends that the amount awarded is on the higher side as the salary amount of Rs.82,633/- taken at the time of computing compensation was unsubstantiated; instead it should have been Rs.72,258/- after deducting certain allowances which were personal in nature to the deceased such as Rs. 7,350/- for petrol reimbursement, Rs.1,000/- for telephone bill; Rs.1,350/- towards bus service and Rs.675/- towards food.

3. It is argued that Form-16 indicates that higher tax deductions were to

be made, therefore, the amount awarded should have been reduced accordingly. It is contended that instead of deducting Rs.37,184.85 i.e. 30% towards TDS, an amount of Rs.1,07,316/- should have been deducted. However, upon examination of Form-16 it is seen that higher deductions were made in the impugned Award, therefore this contention is untenable and is rejected.

4. The learned counsel for the appellant further argues that the Award of 50% towards loss of future prospects is erroneous in view of the judgment of Sarla Verma & Others v. Delhi Transport Corporation and Another 2009 SCJ 1298 especially since the deceased was employed on a contractual basis for only 10 months and therefore the same could not have been taken as permanent employment. Lastly he argues that dependency of the parents was never there since both of them were employed; the father was a Chartered Accountant and the mother was working as an Office Assistant. Again relying on Sarla Verma (supra) he submits that the father can never be deemed to be a dependent of his son. The Court is unable to find such a meaning from the judgment. The relevant portion of the judgment is as under: "Further, subject to evidence to the contrary, the father is likely to have his own income and will not be considered as a dependant and the mother alone will be considered as a dependent". In other words if there is any evidence to show that the father was not earning, he will be deemed to be a dependent. In the present case, it was merely averred that the father was a CA; the presumption cannot be drawn that he was earning a steady salary. In the job application of the deceased, the date of birth of the father is shown as 10.07.1944 and his occupation as CA. Therefore, on the date of demise of his son the father's age was 66 years and the claimants contended

that the father was not earning anything but was entirely dependent on the deceased.

5. During the course of the argument, the learned counsel for the respondents clarified that the father of the deceased was not a qualified Chartered Accountant but was a Chief Accountant in a private company and had superannuated many years prior to the demise of his son.

6. The Court bears in mind that while applying for private employment children often refer to their parents' occupation on the basis of what he/she may have been employed as earlier. Simply because the son had filled his father's occupation as CA did not necessarily mean that he was in employment. Besides, the form said CA and not C.A., the latter being the abbreviation for Chartered Accountant. Whereas CA has rightly been clarified hereinabove as signifying Chief Accountant i.e. a position which can be held only in an organisation till the age of superannuation. In any case, the father's employment or unemployment was never an issue before the Tribunal. The documents of the claimants remained un-rebutted. Hence the contention that the father was employed and not dependent on the deceased is untenable.

7. Referring to the deposition of Mr. Rishi Ranjan (PW2), Senior Manager, Airtel, where the deceased was working, counsel for the respondent submits that the deceased was permanently employed, therefore, there is no error in the Tribunal having awarded the amounts it did. The aforesaid deposition reads as under:

"..... I am posted in the capacity of Senior Manager Human Resource in PL Engineering at the aforesaid address. I have brought with me the summoned record concerning the Ribhu Kanchan who was working with

us as Consultant in E-learning Department. He had applied for a job of Consultant vide employment application dated 26.4.2011 (running into 4 pages). Attested copy thereof is Ex.PW-2/A. He was appointed vide appointment letter dated 20.5.2011 with the terms and conditions as detailed in the appointment letter. Attested copy (running into 4 pages) is Ex.PW-2/B. He had joined the services on 30.5.2011 and the attested copy of joining report (running into two pages) is Ex.PW-2/C. He had declared the nominee vide form 2 (revised) (running into Two pages) and the same is Ex.PW-2/D. The details of month wise salary with regard to the all employees during the financial year 1.4.2011 to 31.3.2012. Attested copy thereof is Ex.PW- 2/E. His last drawn salary for the entire month of August 2011 was Rs. 82,633/- + Rs. 700 (as Ex. Gratia) from 30.5.2011 to 6.9.2011 + 1667 as PE Now this pay slip (running into 4 pages) including income tax calculation is collectively Ex.PW-2/E. He was permanent employee that is why his PF was used to be deducted.

XXXXXX by Sh. Jaidev Sharma, counsel for R1 &R2.

Nil. Opportunity given.

XXXXXX by Ms. Mamta Mayer, counsel for insurance company.

It is correct that the appointment letter does not find mention the nature of the job as permanent. It is wrong to suggest that deceased Ribhu Kanchan was not permanent employee. Special allowances are chosen by the deceased such as HRA., Education allowance, Petrol reimbursement, Telephone Reimbursement, Medical Reimbursement. I have brought with me the flexible benefit pay which was declared by the deceased vide declaration form dated 30.5.2011 at the

time of joining. Photostat copy thereof is Ex.PW-2/RX. It is wrong to suggest that under the head of special allowances the amount of which is Rs.52,000/- also includes the allowance under the head of food coupons, leave travel allowances, uniform allowances. The salary of the deceased was used to be transferred in his account through NEFT mode. It is wrong to suggest that I have deposed falsely at the instance of the petitioners with regard to the salary details. Q: What is the meaning of flexi pay?

A; Flexi pay is the component of salary or the option which is given to the employee to take the taxable or the non taxable part out from the entire flexible amount.

Q: What is the meaning of Bus service DED? A: It is bus service deduction which is done from the employee's salary towards using the transport facility of the company.

I am not aware if any benefit has been given by the State Government on accounts of the head 'Labour Benefit Fund'. However, the benefits used to be given to the employees under the aforesaid heads but I have not brought the break up of that benefit fund. It is wrong to suggest that I am deposing falsely...."

8. The learned counsel for the respondents also submits that the allowances towards HRA, Education, Petrol, Telephone, Medical, were chosen by the deceased, which were otherwise payable to him as salary, therefore, the said amount should not be reduced from the salary amount.

9. The Court would see as to what benefits were given to an employee as 'cost to the company'; ultimately the amounts enjoyed by an employee or the manner in which he takes the reimbursement is always in the context of tax liability. Hence the aforesaid amount cannot be said to be exclusively for his benefit. If it is so, then all the personal expenses of the employee

under the aforesaid heads too would be deducted. In the cross-examination Mr. Rishi Ranjan reiterated that the deceased was in permanent employment which is why his contribution towards his PF were being deducted. In the aforesaid circumstances, the Court is unable to find any fault with the conclusion arrived at by the Tribunal or conclude otherwise.

10. It has been established that the deceased was 40 years old at the time of his demise. The principles of Rajesh vs Rajbir (2013) 9 SCC 54 were rightly applied for awarding 50% towards loss of future prospects.

11. In view of the above, the Court finds no merits in the appeal. The appeal is, accordingly, dismissed. The statutory amount deposited be released to the respondent towards cost for this litigation.

NAJMI WAZIRI, J.

MAY 18, 2017 acm