The National Insurance Company ... vs Mohan Prasad Gupta
2023 Latest Caselaw 402 Jhar

                                       1

      IN THE HIGH COURT OF JHARKHAND AT RANCHI
                      M.A. No. 300 of 2015

The National Insurance Company Ltd. National Insurance Building, Ist Floor, 8,
India Exchange Place, Kolkata through the Divisional Manager, The National
Insurance Co. Ltd., S.N. Ganguly Road, P.O. Ranchi, P.S. Kotwali, District Ranchi,
represented by Dy. Manager, Jharkhand Legal Cell, National Insurance Company
Ltd., Ranchi Branch-II Premises, Kutchery Road, P.O. Ranchi, P.S. Kotwali, District-
Ranchi, Jharkhand
                              ........      Opposite Party No. 2/Appellant
                           Versus
1. Mohan Prasad Gupta, son of Sri Sobhan Sao,
2. Suraj Mani Devi, wife of Mohan Prasad Gupta
   Both are residents of village Basia, P.O. and P.S. Basia, District-Gumla
                   ............ Claimants/Respondents
3. Irfan Khan, son of MS. Hemail Khan, resident of Chandni Maidan (Chandani
   Ground) Kanta Toli, P.O. and P.S. Lalpur, District-Ranchi
                      .......... Opposite Party No. 1/Respondent

                                With
                           M.A. No. 152 of 2016

1. Mohan Prasad Gupta, son of Sri Sobhan Sao,
2. Smt. Suraj Mani Devi, wife of Mohan Prasad Gupta
   Both residents of village Basia, P.O. and P.S. Basia, District-Gumla
             ............ Appellants/Claimants
                           Versus
1. Irfan Khan, son of Ms. Hemail Khan, resident of Chandni Maidan (Chandni
   Ground) Kanta Toli, P.O. and P.S. Lalpur, District-Ranchi-834001
2. The National Insurance Company Ltd. National Insurance Building, Ist Floor, 8,
   India Exchange Place, Kolkata, Kolkata-700001 (West Bengal) through the
   Divisional Manager, The National Insurance Co. Ltd., S.N. Ganguly Road, P.S.
   Kotwali, At and Post-Ranchi-834001................Respondents/Opposite Parties

                   ---------

CORAM:      HON'BLE MR. JUSTICE SANJAY KUMAR DWIVEDI
                          ---------
For the Appellants     : Mr. G.C. Jha, Advocate (in M.A. No. 300/2015)
                         Mr. Arvind Kr. Lall (in M.A. No. 152/2016

For the Respondent Nos. 1 & 2: Mr. Arvind Kr. Lall, Advocate (in M.A. No. 300/2015) For the Respondent No.2 : Mr. G.C. Jha, Advocate (in M.A. No. 152/2016) For the Respondent nos. 3: Mr. Sidhartha Roy, Advocate (in M.A. No. 300/2015) For the Respondent No. 1 : Sidhartha Roy, Advocate (in M.A. No. 152/2016)

13/Dated: 23/01/2023 Heard Mr. G.C. Jha, learned counsel for the Insurance Company, Mr.

Arvind Kr. Lall, learned counsel for the claimants and Mr. Sidhartha Roy, learned

counsel for the owner in both the appeals.

2. Both these appeals are arising out of same award that is why both the

appeals are heard together with the consent of the parties.

3. M.A. No. 300 of 2015 has been filed by the Insurance Company being

aggrieved and dissatisfied with the judgment and Award dated 19.03.2015 passed by

the learned Presiding Officer, Motor Vehicle Accident Claim Tribunal, Ranchi in

Compensation Case No. 81 of 2008 and M.A. No. 152 of 2016 has been filed by the

claimants for enhancement of the awarded amount.

4. Compensation case has been filed by Mohan Prasad Gupta and Suraj

Mani Devi as the legal representative of the deceased Lalu Prasad Gupta. The

claimants are the parents of the deceased. The age of Mohan Prasad Gupta has been

shown as 50 years and that of Suraj Mani Devi is shown as 45 years. The deceased

Lalu Prasad Gupta is shown to be aged about 21 years having monthly income of Rs.

15,000/-.

5. On 08.05.2008 when Lalu Prasad Gupta had gone to Kemta Toli on his

motorcycle from Basia and was standing besides the road waiting for Saniya bus and

signaled the said bus to stop when all of a sudden the said bus bearing Registration

No. JH-01U-3885 driven rashly and negligently by its driver dashed against the

stationary motorcycle of Lalu Prasad Gupta resulting into grievous injuries and

immediate death of Lalu Prasad Gupta. An F.I.R. being Basia P.S. Case No. 41/08 was

registered against the driver of the offending vehicle and charge sheet was also

submitted against the driver of the said bus. Compensation of Rs. 25 lac has been

claimed.

6. The learned tribunal while deciding the claim case awarded a sum of Rs.

7,50,000/- in the joint name of claimant no.1 namely Mohan Prasad Gupta and

claimant no. 2 namely, Suraj Mani Devi with interest at the rate of 9 % per annum

from the date of admission of the claim application i.e. 22.01.2009 till the date of

payment which shall be made within one month from the date of receipt of copy of

the award failing which the interest at the rate of 12% per annum from the date of

judgment shall be payable.

7. Mr. G.C. Jha, learned counsel for the Insurance Company submits that

learned tribunal has wrongly decided on the point of driving licence which was found

to be fake on the enquiry by the insurance company and that finding is required to be

reversed by this Court. He further submits that so far as conventional head is

concerned the award of Rs. 1,25,000/- is required to be modified considering the

judgement of the Hon'ble Supreme Court in the case of "National Insurance Co.

Ltd. Vs. Pranay Sethi (2017) 16 SCC 680. (para 59.4) which is required to be

modified to the tune of Rs. 70,000/-. He further submits that in view of judgment of

'Pranay Sethi(supra) the future prospect is required to be reduced 40% which was

awarded to the 50% by the tribunal. He submits that the awarded amount is fit to

be modified. He submits that there is no provision of panel interest. On these

grounds he seeks modification of award.

8. Mr. Sidhartha Roy, learned counsel for the owner submits that the

learned tribunal has make out specific issue with regard to driving licence as Issue

No. 7. He further submits that the learned tribunal has taken note of arguments

advanced on behalf of the Insurance Company as well as owner and has given finding

at para 18 of the judgment. He further submits that the author of the documents on

which case insurance company claimed the driving licence as forged was not

examined and considering this view of the matter the tribunal has rightly negated the

argument with regard to driving licence. He further submits that it is not the duty of

the owner to examine the driving licence. If the owner is satisfied that driving licence

is there, the only course is required with the owner to being satisf ied in the case of

driver having found the driving licence in order. To buttress his argument, he relied in

the case of "Nirmala Kothari V. United India Insurance Co. Ltd." (AIR 2020

SC 1193) wherein para 11 & 12 the Hon'ble Supreme Court has held as under:-

"11. While hiring a driver the employer is expected to verify if the driver has a driving licence. If the driver produces a licence which on the face of it looks genuine, the employer is not expected to further investigate into the authenticity of the licence unless there is cause to believe otherwise. If the employer finds the driver to be competent to drive the vehicle and has satisfied himself that the driver has a driving licence there would be no breach of Section 149(2)(a)(ii) and the insurance company would be liable under the policy. It would be unreasonable to place such a high onus on the insured to make enquiries with RTOs all over the country to ascertain the veracity of the driving licence. However, if the insurance company is able to prove that the owner/insured was aware or had notice that the licence was fake or invalid and still permitted the person to drive, the insurance company would no longer continue to be liable.

12. On facts, in the instant case, the appellant complainant had employed the driver, Dharmendra Singh as driver after checking his driving licence. The driving licence was purported to have been issued by the licensing authority, Sheikh Sarai, Delhi, however, the same could not be verified as the officer concerned of the licensing authority deposed that the record of the licence was not available with them. It is not the contention of the respondent insurance company that the appellant complainant is guilty of wilful negligence while

employing the driver. The driver had been driving competently and there was no reason for the appellant complainant to doubt the veracity of the driver's licence. In view of above facts and circumstances, the impugned judgment [United India Insurance Co. v. Nirmala Kothari Revision Petition No. 2835 of 2015, order dated 6-2-2018 (NCDRC)] is not liable to be sustained and is hereby set aside. The appeals accordingly stand allowed. The respondent insurance company is held liable to indemnify the appellant."

9. On these points he submits that finding with regard to driving licence is

concerned, there is no illegality in the award. On these grounds he submits that there

is no requirement of interference in the judgment of learned tribunal.

10. Mr. Arvind Kr. Lall, learned counsel for the claimants-respondents in

M.A. No. 300 of 2015 and appellants-claimants in M.A. No. 152 of 2016-which has

been filed for enhancement of award submits that the learned tribunal has wrongly

applied multiplier of 14 considering the age of the parents which is not in accordance

with law whereas the age of deceased was not taken into consideration. For applying

multiplier, the age of the deceased was required to be taken into consideration in view

of judgment of Hon'ble Supreme Court in the case of "Pranay Shethi' (supra)

(para 59.8). He further submits that the learned tribunal has erred in deducting Rs.

30,000/- finding the income of the deceased to the tune of Rs. 84,000/-. He further

submits that the income tax return, bank pass book etc have been produced before

the learned tribunal and deduction of Rs. 30,000/- out of 84,000/- is bad in law. To

buttress his argument, he relied in the case of "K. Ramya & Ors. Vs. National

Insurance Co. Ltd. (2022 (4) JLJR 339) wherein para 13, 21 to 26 the Hon'ble

Supreme Court has held as under;-

13. The Deceased in the present case was a businessman and during the proceedings before the Tribunal, the Appellants produced the relevant income tax returns, audit r eports and other relevant documents pertaining to the commercial ventures of the Deceased to prove the loss of income attributable on account of his sudden demise. The Tribunal relied on the same and computed the income by taking an average of the income recorded in three prior financial years (FY 2000-2001, FY 2001-2002 and FY 2002-2003) to determine the compensation under the head of 'loss of income.

21. Now, the sole issue which remains before this court is whether the entire amount under 'Income from House Property and Agricultural Land' should be deducted or not. In this respect, we are guided by the observations of this court in State of Haryana v Jasbir Kaur16 wherein it was noted that -

The l and possessed by the deceased still remains with his legal heirs. There is however a possibility that the claimants may be required to engage persons to look after agriculture. Therefore, the normal rule about the deprivation of Income is not strictly applicable to cases where agricultural income is the source. Attendant circumstances have to be considered.

(Emphasis Applied) In our opinion, the abovementioned observations, though made in the

context of agricultural land, would also be applicable to rent received from leased out properties as the loss of dependency arises mainly out of loss of management capacity or efficiency. As a rule of prudence, computation of any individual's managerial skills should lie between 10 to 15 per cent of the total rental income but the acceptable range can be increased in light of specific circumstances. The appropriate approach, therefore, is to determine the value of managerial skills along with any other factual considerations.

22. In the instant case, documents produced on record indicate two salient aspects with respect to 'Lakshmi Complex', which was the sole source of rental income for the deceased. The partition deed related to the land on which the commercial building is situated, highlights that the building was constructed on account of the joint investment made by the Deceased and his partners. Furthermore, as per the rental records, 'Lakshmi Complex' was leased out to more than ten different commercial entities. Hence, keeping in mind t hat - first, the rental amount which is sought to be deducted partakes the character of investment; and second, that the managerial skills required for supervising the said building would require sophisticated contract management skills and goodwill among the business community, it is necessary that we determine the value of managerial skills of the Deceased on the higher side.

23. Accordingly, we deem it appropriate to award Rs 2,50,000/- as the amount for the Deceased's managerial skills. It is clarified that the said amount would also include the amount for the managerial skills in respect of the Deceased's agricultural lands. It is further clarified that the remaining amount which has been deducted by us includes the tax which has to be deducted in terms of the decision in Pranay Sethi17.

D. CONCLUSION

24. In light of the above discussion, income of the Deceased is computed by adding the amount awarded under the two parts ( Rs 10,93,000/- + Rs 2,50,000/-), which comes to Rs 13,43,000/-. In terms of Pranay Sethi18, forty per cent of the income has to be added towards future prospects, which would come to Rs 18,80,200/-. After deducting one-fourth towards personal expenses as per Sarla Verma19, the net amount comes to Rs 14,10,150/- per annum. Applying the multiplier of 16, the total loss of dependency on account of the Deceased's income is calculated at Rs 2,25,62,400/-. We further grant compensation under the remaining conventional heads as per the decisions in Pranay Sethi and Satinder Kaur.

25. Hence, the compensation is determined as per follows Head Amount 1. Loss of Income = [(Income + Future Prospects computed at 40%) - 1/4th Deduction for Personal Expense] x Multiplier Rs 2,25,62,400/2. Funeral Expenses Rs 15,000/3. Loss of Estate Rs 15,000/4. Loss of Spousal Consortium Rs 40,000/5.Loss of Parental Consortium Rs 40,000 x 2) = Rs 80,000/Total compensation (1+2+3+4+5) Rs 2,27,12,400/

26. We also direct that the interest at the rate of 7.5% per annum shall be payable on the aforesaid amount from the date of filing the claim petition till the date of realization. The enhanced amount shall be paid to the claimants within three months from today. Needless to say, that the amount already paid or deposited shall be adjusted while depositing the enhanced compensation awarded by this court. "

11. He submits that on consortium learned tribunal has not given the amount

of on conventional head and in view of "Pranay Sethi" (supra) (para 59.8) a sum

of Rs. 70,000/- is required to be provided. He further submits that in view of section

168 of Motor Vehicle Act, the award is required to be complied with within 30 days

and accordingly, award has been passed. On these grounds he submits that award is

required to be modified.

12. Countering the claim of the claimants, Mr. Jha relied in the case of

"New India Assurance Co. Ltd. Vs. Yogesh Devi & Ors. 2012 (2) Supreme

284 particularly para 11,12, 13 which are quoted here-in-below:-

"11. Coming to the case on hand, the claim is based on the assertion that the deceased owned agricultural land apart from the abovementioned three minibuses. The High Court rejected the claim insofar as it is based on the income from the land, on the ground that the income would still continue to accrue to the benefit of the family. Unfortunately, the High Court failed to see that the same logic would be applicable even to the income from the abovementioned three buses. The asset (three minibuses) would still continue with the family and fetch income. The only difference, perhaps, would be that during his lifetime the deceased was managing the buses, but now, the claimants may have to engage some competent person to manage the asset, which, in turn, would require some payment to be made to such a manager. To the extent of such payment, there would be a depletion in the net income accruing to the claimants out of the asset. Therefore, the amount required for engaging the service of a manager and the salary payable to a driver--as it is asserted that the deceased himself used to drive one of the three buses--would be the loss to the claimants. In the normal course the claimants are expected to adduce evidence as to what would be the quantum of depletion in the income from the abovementioned asset on account of the abovementioned factors. Unfortunately, no such evidence was led by the claimants.

12. In the circumstances, the judgment under appeal cannot be sustained as the finding of the High Court that the claimants lost an amount of Rs 16,000 per month due to the death of Vijender Singh is neither based on any evidence nor the logic adopted by the High Court for arriving at such a conclusion is right. In the normal course, the matter should have been remitted to the Tribunal for further evidence for ascertaining of the basis upon which the compensation is to be determined. But having regard to the fact that the accident occurred a decade ago, we do not propose to remit the matter for further evidence.

13. The High Court opined that the deceased would have contributed an amount of Rs 16,000 per month to the dependants, whereas the Tribunal opined that the deceased would have contributed an amount of Rs 5000. Both the courts below proceeded to arrive at the abovementioned amounts on the basis that as a driver of one of the buses, he was getting a salary of Rs 3900 per month. In the circumstances, making a reasonable conjecture that somebody is to be employed for the purpose of managing the business of the three minibuses, would certainly demand a higher salary than a driver, we think it reasonable to notionally fix the salary of such manager at Rs 10,000 per month. The said amount coupled with the salary of one driver i.e. Rs 3900 would be the loss sustained by the family from the income arising out of the asset. Computed on the basis of the said figure and applying the same multiplier of 16 which was applied by both the courts below, the amount of compensation payable to the claimants would be:

13,900 × 12 × 16 = Rs 26,68,800."

Relying on the aforesaid judgment, Mr. Jha, submits that learned tribunal has

rightly came to the conclusion that business has not come to an end and in view of

the said judgment, there is no interference required by this Court.

13. In view of above submission of the learned counsel for the parties the

Court has gone through the judgement of the learned tribunal as well as L.C.R which

has been received pursuant to order dated 02.08.2022 and finds that the learned

tribunal has framed issue with regard to driving licence which is Issue No. 7 and has

taken care of arguments with regard to driving licence advanced on behalf of the

insurance company as well as owner which are at para 10 and 11. While deciding

the said issue the tribunal has held that the documents marked Exhibit-B

conclusively shows that the documents were available for verification and only report

in respect of the driving licence has been brought on record and the driving licence

was not brought on record by the insurance company. The driving licence brought on

record by the owner of the vehicle was found to be correct. The competent authority

has issued the said driving licence and number has been disclosed at that time. The

person on the basis of which report was prepared report has not been examined by

the insurance company and considering that aspect of the matter the contention of

the insurance company was decided against the insurance company by the tribunal

as it is well settled that onus lies upon a person who claims anything to prove

before the competent court. Accordingly, the argument of Mr. Jha with regard to

driving licence is not accepted by this Court.

14. The judgment relied by Mr. Jha, the Hon'ble Supreme Court has

interfered and considering that no evidence nor any logic was brought on record with

regard to the income it has been considered in para 12 of the said judgment. In the

case in hand, the income tax return and the audit report have brought on record in

view of the matter, judgment of Mr. Jha is not helping the Insurance Company.

15. With regard to argument of learned counsel for the Insurance Company

with respect to future prospect as has been held in Pranay Sethi (supra) is 40%

whereas the learned tribunal has fixed 50% in future prospect. In that view of the

matter future prospect is required to be considered as 40%. Accordingly, this is

modified to the extent that future prospect shall be 40% in place of 50%. It is well

settled that for love and affection there is no head made by any of the Court and on

the head of love and affection judgements are not decided for claim and accordingly,

that part of award is not required to be implemented and that part of the award is

required to be modified in view of Pranay Sethi (surpa) as 70,000/- under the

conventional head. Accordingly, that part of the award is modified. So far as interest

part is to be considered, considering section 168 of the Motor Vehicle Act, the tribunal

has rightly passed the award to be satisfied within 30 days. There is no illegality. If

the award is not satisfied, the contention of Mr. Jha with regard to further 12% per

annum interest is negated by this Court. Accordingly, M.A. No. 300 of 2015 is

disposed of with modification indicated herein i.e. future prospect shall be 40% in

place of 50%, award is required to be modified in view of Pranay Sethi (surpa) as

70,000/- under the conventional head.

16. So far argument of Mr. Arwind Kr. Lall, learned counsel for the appellants-

Claimants in M.A. No. 152 of 2016 for enhancement of awarded amount is

concerned, the court finds that the age of the deceased was assessed as 21 years

which was recorded by the learned tribunal and multiplier has been applied by the

learned tribunal at age of parents which is against the mandate of law in the light of

Pranay Sethi (supra) the age of deceased was to be taken into consideration and

considering the age of the deceased 21 years the multiplier was required to be

applied as 18 in place of 14. Accordingly, the multiplier is modified to 18. On the point

of award, multiplier will be 18 in place of 14. The court finds that the learned

tribunal has assessed the income of the deceased Rs. 84,000/- and considering that

truck business has not come to an end due to death of deceased further deducted

Rs. 30,000/- from the income and after deduction Rs. 30,000/- has considered the

income of the deceased of Rs. 60,000/-. On the point of income the judgment relied

by Mr. Lall in the case of 'K. Ramya (supra) , in that case income tax return was

produced and considering that the Hon'ble Supreme Court has considered that in

these documents are valid that is why interfered with the award. In the case in hand

learned tribunal has looked into the pass books produced by the claimants of the

deceased which have been found about the transaction. Exhibit -2 is income take

return and the chartered accountant has issued the certificate of amount which has

been earned by the deceased and considering that income and audit report are

reliable evidences to deduct the income of the deceased and in view of the judgment

of the Hon'ble Supreme Court in 'K Ramya'(supra) the deduction of Rs. 30,000/-

was not required to be done by the learned tribunal and therefore, the income of the

deceased shall be counted Rs. 84,000/- which has been calculated by the learned

tribunal and the award on that aspect is modified to the above extent.

17. Considering that the deceased was bachelor, 50% of the total income

has been rightly been directed to be deduced by the learned tribunal. In

conventional head, the claimants are entitled for Rs. 70,000/- as held by the Hon'ble

Supreme Court in the case of "Pranay Sethi (supra). Accordingly, MA. No. 152 of

2016 is disposed of with modification indicated hereinabove i.e. multiplier will be 18

in place of 14, income of the deceased shall be counted Rs. 84,000/, conventional

head, the claimants are entitled for Rs. 70,000/-.

18. It is expected that insurance company shall satisfy the award within 8

weeks.

19. The statutory amount deposited by the Insurance Companies shall be

transmitted back to the learned tribunal forthwith. The learned tribunal shall take

endeavor to release the said amount and fruit of award in favour of the claimants at

the earliest if the same has not been provided as yet. The award in both the appeals

are modified in above terms. Rest part of the findings of the learned tribunal are kept

intact.

20. L.C.R. be remitted back to concerned court forthwith.

( Sanjay Kumar Dwivedi, J.)

Satyarthi/