Delhi High Court
Rashmi Jain & Ors. vs Oriental Insurance Co. Ltd.& Ors. on 26 September, 2017
$~R-269 & 270
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Decided on: 26th September, 2017
+ MAC APPEAL No.806/2010
ORIENTAL INSURANCE CO. LTD. ..... Appellant
Through: Mr. Pavan Kumar for Mr. A.K.
Soni, Adv.
versus
RASHMI JAIN & ORS. ..... Respondents
Through: Mr. Navneet Goyal, Adv. for R-
1 to 4.
+ MAC APPEAL No.859/2010
RASHMI JAIN & ORS. ..... Appellants
Through: Mr. Navneet Goyal, Adv.
versus
ORIENTAL INSURANCE CO. LTD.& ORS. ..... Respondents
Through: Mr. Pavan Kumar for Mr. A.K.
Soni, Adv. for R-1.
CORAM:
HON'BLE MR. JUSTICE R.K.GAUBA
JUDGMENT (ORAL)
1. Rohit Jain, then 38 years old, met with an accident on
14.04.2003 involving negligent driving of car bearing registration no.
DL 1Z 0862, admittedly insured against third party risk for the period
in question with the appellant insurance company (insurer) and died as
a result of injuries suffered. His wife and other members of the family
dependent on him, they being appellants in MAC Appeal no. 859/2010
(collectively, the claimants) instituted accident claim case (MACP
613/03/08) on 02.12.2003 seeking compensation under Section 166 of
Motor Vehicles Act, 1988. The tribunal held inquiry, and by judgment
dated 14.09.2010, awarded compensation in the total sum of Rs.
15,82,500/- directing the insurer (appellant) to pay the same with
interest @ 7.5% per annum. The said amount of compensation was
calculated thus:-
S.No. Heads Compensation
1. Loss of dependency (Rs. 7875 x Rs. 14,17,500/-
12 x 15)
2. Loss of consortium Rs. 10,000/-
3. For Funeral Expenses Rs. 10,000/-
4. For loss of Love & Affection Rs. 1,25,000/-
5. For Loss of Estate Rs. 10,000/-
6. For treatment Rs. 10,000/-
Total Rs. 15,82,500/-
2. The insurer by its appeal (MAC Appeal no. 806/2010) has
questioned the calculation of loss of dependency on the ground that
the element of future prospects of increase in income to the extent of
50% was wrongly added over and above the income assessed in the
sum of Rs. 7,000/- per month. Per contra, the claimants, by their
appeal (MAC Appeal No. 859/2010), submit that the income was
under-assessed and this has led to deficient award being granted under
the head of loss of dependency.
3. It is noted that the evidence led by the claimants had clearly
brought out that the deceased had been engaged in business as a
partner of a firm known as Tarun International, his mother Kailash
Jain being the other partner. The income-tax returns (ITRs) of the firm
Tarun International were proved for various years, starting from
assessment year (AY) 1994-95, as Ex.PA-1 to PA-12, one of them
(Ex.PA-9) pertaining to assessment year 2002-2003 which would
correspond to the financial year 2001-2002. The said return (of the
firm Tarun International) clearly shows that as a partner Rohit Jain
had received Rs. 64,497.74 as his share in profits (page 505 of the
tribunal's record).
4. The claimants also proved, similarly, the ITRs of Rohit Jain
submitted as an individual assessee for various assessment years,
starting with 1995-96, the income declared therein being (till the
financial year 2000-2001 corresponding to AY 2001-02) on account of
share in profits from business of the above said firm. From the next
financial year i.e. 2001-2002 (which would correspond to AY 2002-
03), however, the source of income changed, in that instead of being a
partner in the said firm, the deceased had joined as its salaried
employee w.e.f. 01.07.2001. This position is reflected in the ITR for
AY 2002-2003 (Ex.P-11) (at page 125 of the Tribunal's record), it
confirming receipt of Rs. 64,497.74 as share in profits from Tarun
International besides Rs. 63,000/- as salary for the period 01.07.2001
to 31.03.2002. The said ITR of the individual (Ex.P-11) corroborates
the ITR of the firm (Ex. PA-9).
5. In the above facts and circumstances, it was not fair on the part
of the tribunal to assume the income of the deceased only at Rs.
7,000/- per month. The salary at the said rate was the income only for
the period of nine months. In these circumstances, the income earlier
earned, though as share in the profits of the business, could not have
been ignored. It may be added here that in the next financial year
2002-2003 (which would correspond to AY 2003-2004), the deceased
had declared his total income to be Rs. 1,20,000/-, the net salary of Rs.
90,000/-, after standard deduction of Rs. 30,000/ having been shown
in the ITR (Ex.P-12).
6. The ITRs which have been submitted justify the plea of the
claimants that the income of the deceased should have been calculated
after clubbing the share of profits with the last salary drawn in the
financial year 2001-02 which would precede the year in which the
death occurred, it computing to (64,498 + 63,000) Rs. 1,27,498/-. It
may be added that the ITRs also provide irrefutable evidence of
progressive rise in income justifying the inclusion of the element of
future prospects of increase in income to which the insurance
company is taking exception [see judgment dated 28.03.2016 in
MAC.APP. 548/2013 United India Insurance Co. Ltd. v. Kamla &
Ors.].
7. The death had occurred on 17.04.2003. For the financial year
2003-2004, the income-tax liability would be Rs. 9,000/-
approximately. The same being deducted, the net salary comes to
(1,27,498- 9,000) Rs. 1,18,498/-. Against the above backdrop, the loss
of dependency is recomputed by including the element of future
prospects of increase in income by 50%, and making deduction of
1/4th towards personal & living expenses, applying the multiplier of
15 as (118498 x 150 ÷100 x 3 ÷4 x 15) Rs. 19,99,653.75/- rounded off
to Rs. 20,00,000/-. Adding the other components of compensation
granted by the tribunal, the total compensation comes to (20,00,000 +
1,65,000) Rs. 21,65,000/- (Rupees Twenty One Lakhs Sixty Five
Thousand only). The award is modified accordingly.
8. Following the consistent view taken by this Court, the rate of
interest is increased to 9% (nine percent) per annum from the date of
filing of the petition till realization. [see judgment dated 22.02.2016
in MAC.APP. 165/2011 Oriental Insurance Co Ltd v. Sangeeta Devi
& Ors.]
9. It is directed that the enhanced portion of the award shall fall to
the share of the first claimant Rashmi Jain (widow) only, it to be
released in her favour in the form of fixed deposit interest bearing
receipt taken out from a nationalized bank for a period of seven years
with right to draw periodic interest.
10. By order dated 29.11.2010 on MAC Appeal no. 806/2010, the
insurance company had been directed to deposit the entire awarded
amount with upto date interest and from out of such deposit, 75%
(seventy five percent) was allowed to be released to the claimants.
The balance lying in deposit shall also now be released to the
claimants in terms of the impugned judgment. The insurance
company shall satisfy the modified award in above terms by requisite
deposit with the tribunal within thirty days.
11. The statutory deposit by the insurance company, however, shall
be refunded.
12. Both appeals are disposed of in above terms.
R.K.GAUBA, J.
SEPTEMBER 26, 2017
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