Orissa High Court
In Maca No.593/2016 vs P.Ramalingeswar Rao & Another on 5 April, 2021
ORISSA HIGH COURT : C U T T A C K
MACA NOS.593 & 774 OF 2016
In the matter of Appeals under Section 173 of the Motor Vehicles Act, 1988.
In MACA No.593/2016
S. Divya & Others : Appellant
-Versus-
P.Ramalingeswar Rao & another : Respondents
For Appellants : M/s.K.K.Das & P.K.Pradhan
For Respondent No.1 : None
For Respondent No.2 : M/s.G.Mishra, Sr.Advocate,
D.K.Patra, A.Dash, J.Biswal
& J.R.Deo
In MACA No.774/2016
National Insurance Company Ltd. & Others : Appellant
-Versus-
S. Divya & Others : Respondents
For Appellant : M/s.G.Mishra, Sr.Advocate,
D.K.Patra, A.Dash, J.Biswal
& J.R.Deo
For Respondent Nos.1 to 4 : M/s.K.K.Das & P.K.Pradhan
For Respondent No.5 : None
PRESENT:-
THE HONOURABLE MR. JUSTICE BISWANATH RATH
Date of hearing : 19.03.2021 & Date of Judgment : 05.04.2021
Biswanath Rath, J. MACA No.593 of 2016 is at the instance of the
Claimants seeking enhancement of the award amount involving
2
judgment in MAC No.113 of 2011, whereas MACA No.774 of 2016 is at
the instance of the Insurance Company involved herein involving the
same judgment involving both computation aspect as well as
calculation of future prospects.
2. For the common facts involving both the Appeals, on
single hearing of both sides further on consent of both learned counsel
for the Parties, the same are decided by this common judgment.
3. Background
involving the case is that the Claimants
being the legal heirs claimed compensation to the tune of
Rs.32,00,000/- on account of death of the deceased on a vehicular
accident caused by the offending Truck bearing Regn. No.AP-05-TT-
5665 on 15.12.2010 on N.H.5 in the Balugaon Bazaar. The Claimants
further pleaded that on 15.12.2010 at about 8 P.M. when the deceased
was proceeding to perform his duty by a bicycle on left side of the road
near Balugaon Bazaar on N.H.5 the offending Truck came in high
speed also in rash and negligent manner and dashed against the
deceased from his backside. Said vehicle ran over him resulting death
of the deceased at the spot itself. Postmortem was also conducted.
There is material that the cause of death was accident. On the
premises that the deceased was hardly 39 years of age and being
engaged as a Technician, Grade-I (Elect/Traction Distribution) under
the East Coast Railways, Khurda Road and was earning salary of
Rs.24,315/- per month at the relevant point of time, the claim petition
was put up claiming Rs.32,00,000/-. The Owner of the registered
vehicle did not contest the proceeding and set ex parte. Opposite Party
No.2, the Insurance Company therein contested the case by filing
objection and asking the Claimants to prove the case through
documents. The Insurance Company also contested the case on the
premises that they are not liable to pay compensation.
4. Based on the pleading, the Tribunal framed the
following Issues :-
I) Whether due to rash and (or) negligent driving of the
driver of the offending vehicle bearing registration
no.AP-05-TT-5665 the accident took place and in
that accident the deceased, Late S.Jagadeswara
Achary, succumbed to injuries ?
II) Whether the petitioners are entitled to get the
compensation. If so, what would be the extent ?
III) Whether both the Opposite Parties or either of them
are/is liable to pay the compensation ? and
IV) To what relief(s), if any, the petitioners are entitled to
?"
5. The Claimants to satisfy their case examined two
witnesses. Opposite Party No.2 examined none. Claimants exhibited
Exts.1 to 18 to support their case, whereas the Insurance Company,
Opposite Party No.2 therein exhibited Exts.A to F. Based on the
pleading, the evidence as well as the material support and the
submissions of both the Claimants and the Insurance Company, the
1st Additional District Judge-cum-1st M.A.C.T., Cuttack (herein after
called as "Tribunal") after holding all the Issues in favour of the
Claimants allowed the Claim Case ex parte against Opposite Party
No.1 therein and on contest against Opposite Party No.2, the
Appellant herein thereby directing the Insurance Company to pay
compensation of Rs.49,83,355/- with simple interest @ 7% per annum
with effect from the date of filing of the claim application, i.e., 5.3.2011
along with cost of Rs.1000/-, however giving right to recover from the
registered owner of the offending vehicle.
In the said order, the Tribunal also adopted a
pattern to utilize the compensation amount in a manner keeping in
view the best interest of the Claimants. It is needless to submit here
answering Issue Nos.II to IV, the Tribunal has come to hold that there
was valid insurance covering the accident but there remains a doubt
on the validity of the Driving Licence on the date of accident for non-
cooperation of the Driver and thus the direction also contained a scope
for right to recovery.
6. Contesting the judgment, the Insurance Company
assailed the judgment primarily on the question of quantum and has
taken the following ground :
"C. For that the quantum of compensation has been
computed on the basis of monthly salary of deceased of
Rs.24,115/- (excluding P.T. of Rs.200/-) by completely ignoring
that the said gross salary includes certain allowances
amounting to Rs.4,600/- per month like transport allowances,
travelling allowance etc. which are purely personal in nature
and not meant for the benefit of family of the deceased. Thus,
the learned tribunal failed to take into account the aforesaid
aspect and as such the impugned award deserves to be
modified.
D. For that the learned Court below failed to
appreciate Indira Srivastava's case and has illegally taken into
account the perks of the deceased while awarding a bonanza in
favour of the claimant.
F. For that since there is absolutely no evidence to
show that the deceased had any permanent job/occupation
and fixed income, the decision of the learned Tribunal to make
further addition of 50% to the income on the head of future
prospects is erroneous and not in consonance with the settled
position of law and as such the impugned award is liable to be
set aside.
G. For that the learned court below failed to
appreciate that the wife of the deceased has subsequently got
compassionate appointment in a similar post and thus the
awarded amount is liable to be substantially reduced keeping
in mind the decision in the case of Vimal Kanwar.
H. For that the learned tribunal failed to appreciate
that compensation awarded must be reasonable compensation
and the same should not be a bonanza in favour of the
claimants. In the instant case the compensation awarded is
grossly high and thus the impugned award is liable to be set
aside. The Hon'ble Supreme Court in the case of State of
Haryana V. Jasbir Kaur reported in (2003) 7 SCC 484 has
held that compensation awarded should not be a bonanza."
7. Similarly Claimants in their Appeal for enhancement
of the compensation on different score alleged that the Tribunal
committed error in not granting compensation on the head of loss of
estate and took help of the decision of the Hon'ble apex Court in 2015
(1) TAC 337. Through Ground No.III, the claimants taking support of
the decision in 2015(1) TAC 673 SC, 2013(3) TAC 697 SC etc. again
claimed on the head of loss of love and affection. Through Ground
No.IV, the Claimants also claimed towards loss of consortium of
Rs.1,00,000/-. The Claimants also taking reference to the decisions of
the Hon'ble apex Court in 2014 (I) TAC 369 SC and 2014(I) TAC 727
contended that the Tribunal also failed in not granting cost of
litigation.
8. Advancing his submission, Sri G.Mishra, learned
senior counsel for the Insurance Company taking this Court to
Ground Nos.C, F & H attempted to take help of the decisions of the
Hon'ble apex Court in Sebastiani Lakra & others vrs. National
Insurance Company Ltd. & another : AIR 2018 SC 5034. Taking
this Court to Paragraph-21 of the said decision, Sri Mishra, learned
senior counsel claimed that there should be at least some deduction
on the head of future prospects taking into account the high rate of
compensation already granted by the Tribunal and further taking into
consideration the development during pendency of the Case to the
effect that during pendency of the Case, Wife of the deceased has been
provided with an appointment under the Rehabilitation Assistance
Scheme. Sri Mishra, learned senior counsel, therefore contended that
the fact of future gain to the family on account of death of the
deceased by way of service should have also been kept in mind of the
Tribunal while granting compensation and future prospects. It is in
this view of the matter, Sri Mishra prayed for interference in the
impugned award in respect of compensation as well as future
prospects and the award should be modified accordingly.
9. Similarly, while opposing the contention of Sri
G.Misra, learned senior counsel for the Appellant on the head of future
prospects and took help of some decisions of Hon'ble apex Court in
Vimal Kanwar & Others vrs. Kishore Dan & Others : 2013(3) TAC
6 (SC) (Paragraph-20), Reliance General Insurance Company Ltd.
vrs. Shashi Sharma & Others : (2016) 9 SCC 627, National
Insurance Company Ltd. vrs. Rekhaben & Others : (2017) 13 SCC
547 (Paragraphs-22 & 23) and also took aid of the decision in
Sebastiani Lakra & Others vrs. National Insurance Company
Ltd. & another : (2019) 17 SCC 465 (Paragraphs-12 to 18), Sri
K.K.Das, learned counsel for the Claimants on reiteration of the
Grounds as indicated herein above in the Claimants' Appeal bearing
MACA No.593 of 2016 contested the impugned judgment on the
premises that widow's compassionate appointment and getting
salary/some benefits on the death of her husband not to be deducted
from gross income while calculating compensation. Similarly on the
challenge of the Insurance Company on the aspect of future prospects
taking aid of the decision of the Hon'ble apex Court in National
Insurance Company vrs. Pranaya Sethi & Others : (2017) 16 SCC
680 (Paragraph-59.3), Sri Das, learned counsel for the Claimants
submitted that there is just consideration by the Tribunal and such
judgment should not be interfered with. Coming to claimants' Appeal
making a claim on account of consortium taking help of a decision of
the Hon'ble apex Court in New India Assurance Company vs.
Somwati & Others : (2020) 9 SCC 644 (Paragraphs-40 & 41), Sri
Das, learned counsel for the Claimants attempted to justify his claim
on loss of consortium. Taking help of the decision in Syed Sadiq, etc.
vrs. Divisional Manager, United India Insurance Co.: 2014(1) TAC
369 (SC) (Paragraph-18), Sri Das also attempted to justify his claim on
litigation expenses. It is in the above legal positions, Sri Das attempted
to justify the balance claim of the Claimants and also to satisfy that
there is no legality in the claim of the Insurance Company, and thus
contended on interfering with the impugned award, this Court should
only increase and or grant the compensation on the above head in
favour of the Claimants.
10. Considering the rival contentions of the Parties, this
Court finds, there is no dispute with regard to the accident causing
death of the deceased. There is also no dispute with regard to the wage
aspect involving the deceased, further there also remains no dispute
with regard to the offending vehicle causing accident resulting in
death of the deceased and the offending vehicle has the valid
Insurance at the time of accident. The Claimants side when claiming
increase in the compensation on the head of consortium, litigation
expenses and loss of estate, the Insurance Company is claiming
interference in the award, firstly on the ground of high grant of
compensation on future loss aspect and also on the ground of mode of
calculation by the Tribunal taking into consideration the salary and
expenditure on the family members by the deceased and illegal
inclusion of certain amount should have been excluded, further on the
ground that the Tribunal has not taken into account the fact of Wife of
the deceased getting into a compassionate appointment, particularly
through Ground No.G. Here the Insurance Company against Ground
No.G is also taking help of the decision in Vimal Kanwar(supra).
At this stage, taking into consideration the citations
cited at bar by both the sides, this Court finds the Hon'ble apex Court
in the case of Helen C. Rebello (Mrs.) and others v. Maharashtra
State Road Transport Corporation & Anr.: (1999) 1 SCC 90, while
dealing with the concept of pecuniary advantage, the Hon'ble apex
Court has come to hold that Provident Fund, Pension, Insurance and
similarly any cash, bank balance, shares, fixed deposits etc. are all a
"pecuniary advantage" receivable by the heirs on account of one's
death but all these have no correlation with the amount receivable
under a statute occasioned only on account of accidental death. Such
an amount will not come within the periphery of the Motor Vehicles
Act to be termed as "Pecuniary Advantage" liable for deduction. This
Court takes into account paragraph-35 of the aforesaid judgment,
which reads as herein below :
"35. Broadly, we may examine the receipt of the
provident fund which is a deferred payment out of the
contribution made by an employee during the tenure of his
service. Such employee or his heirs are entitled to receive this
amount irrespective of the accidental death. This amount is
secured, is certain to be received, while the amount under
the Motor Vehicles Act is uncertain and is receivable only on the
happening of the event viz., accident which may not take place at
all. Similarly, family pension is also earned by an employee for
the benefit of his family in the form of his contribution in the
service in terms of the service conditions receivable by the heirs
after his death. The heirs receive family pension even otherwise
than the accidental death. No co-relation between the two.
Similarly, life insurance policy is received either by the insured or
the heirs of the insured on account of the contract with the
insurer, for which insured contributes in the form of premium. It
is receivable even by the insured, if he lives till maturity after
paying all the premiums, in the case of death insurer indemnifies
to pay the sum to the heirs, again in terms of the contracts for
the premium paid. Again, this amount is receivable by the
claimant not on account of any accidental death but otherwise on
insured's death. Death is only a step or contingency in terms of
the contract, to receive the amount. Similarly any case, bank
balance, shares, fixed deposits, etc. though are all a pecuniary
advantage receivable by the heirs on account of one's death but
all these have no co-relation with the amount receivable under a
statute occasioned only on account of accidental death. How
could such an amount come within the periphery of the Motor
Vehicles Act to be termed as 'pecuniary advantage' liable for
deduction. When we seek the principle of loss and gain, it has to
be on similar and same plane having nexus inter so between
them and not to which, there is no semblance of any co-relation.
The insured (deceased) contributes his own money for which he
receives the amount has no co-relation to the compensation
computed as against tort feasor for his negligence on account of
accident. As aforesaid, the amount receivable as compensation
under the Act is on account of the injury of death without making
any contribution towards it then how can fruits of an amount
received through contributions of the insured be deducted out of
the amount receivable under the Motor Vehicles Act. The amount
under this Act, he receives without any contribution. As we have
said the compensation payable under the Motor Vehicles Act is
statutory while the amount received under the life insurance
policy is contractual."
11. Similarly, in the case of Vimal Kanwar (supra),
through paragraphs-20 and 29 to 33, the Hon'ble apex Court held
that:
"20. The second issue is "whether the salary receivable by the
claimant on compassionate appointment comes within the
periphery of the Motor Vehicles Act to be termed as "pecuniary
advantage" liable for deduction".
"Compassionate appointment" can be one of the
conditions of service of an employee, if a scheme to that effect is
framed by the service leaving behind the dependents, one of the
dependents may request for compassionate appointment to
maintain the family of the deceased employee dies in harness.
This cannot be stated to be an advantage receivable by the heirs
on account of one's death and have no correlation with the
amount receivable under a statute occasioned on account of
accidental death. Compassionate appointment may have nexus
with the death of an employee while in service but it is not
necessary that it should have a correlation with the accidental
death. An employee dies in harness even in normal course, due
to illness and to maintain the family of the deceased one of the
dependents may be entitled for compassionate appointment but
that cannot be termed as "Pecuniary Advantage" that comes
under the periphery of Motor Vehicles Act and any amount
received on such appointment is not liable for deduction for
determination of compensation under the Motor vehicles Act.
29. Admittedly, the date of birth of deceased Sajjan Singh being 1st
February, 1968; the submission that he would have continued
in service up to 1st February, 2026, if 58 years is the age of
retirement or 1st February, 2028, if 60 years is the age of
retirement is accepted. He was only 28 years 7½ months old at
the time of death. In normal course, he would have served the
State Government minimum for about 30 years. Even if we do
not take into consideration the future prospect of promotion
which the deceased was otherwise entitled and the actual pay
revisions taken effect from 1st January, 1996 and 1st January,
2006, it cannot be denied that the pay of the deceased would
have doubled if he would continued in services of the State till
the date of retirement. Hence, this was a fit case in which 100%
increase in the future income of the deceased have been allowed
by the Tribunal and the High Court, which they failed to do.
30. Having regard to the facts and evidence on record, we estimate
the monthly income of the deceased Sajjan Singh at Rs.9,000 ×
2 = Rs.18,000/- per month. From this his personal living
expenses, which should be ⅓rd, there being three dependants
has to be deducted. Thereby, the 'actual salary' will come to
Rs.18,000/- - Rs.6,000/- = Rs.12,000/- per month or
Rs.12,000/- × 12 = Rs.1,44,000/- per annum. As the deceased
was 28½ years old at the time of death the multiplier of 17 is
applied, which is appropriate to the age of the deceased. The
normal compensation would then work out to be Rs 1,44,000/-
× 17 = Rs.24,48,000/- to which we add the usual award for loss
of consortium and loss of the estate by providing a conventional
sum of Rs.1,00,000/-; loss of love and affection for the daughter
Rs.2,00,000/-, loss of love and affection for the widow and the
mother at Rs.1,00,000/- each i.e. Rs.2,00,000/- and funeral
expenses of Rs.25,000/-.
31. Thus, according to us, in all a sum of Rs.29,73,000/- would be a
fair, just and reasonable award in the circumstances of this
case.
32. The rate of interest of 12% is allowed from the date of the
petition filed before the Tribunal till payment is made.
33. RespondentNo.3 is directed to pay the total award with interest
minus the amount (if already paid) within three months. The
appellant No.2 daughter who was aged about 2 years at the time
of accident of the deceased has already attained majority; money
may be required for her education and marriage. In the
circumstances, we direct respondent No.3 to deposit 25% of the
due amount in the account of appellant No.1 the wife. Out of the
rest 75% of the due amount, 35% of the amount be invested in a
Nationalized Bank by fixed deposit for a period of one year n the
name of the daughter-appellant No.2. Out of the rest 40% of the
due amount, 20% each be invested in a Nationalized Bank by
fixed deposit for a period of one year in the name of the
appellant Nos.1 and 3, the wife and the mother respectively."
It is apt to note here that this decision is also
already reported in (2013) 7 SCC 476.
12. In the case of Reliance General Insurance Company
Ltd. (supra), through Paragraph-14, the Hon'ble apex Court while
taking note of observations in Paragraph-35 of the decision in Helen C.
Rebello (supra) in Paragraphs-15, 17 and 18 observed as follows :
"15. The principle expounded in this decision in Helen C. Rebello
case [Helen C. Rebello v. Maharashtra SRTC, (1999) 1 SCC
90 : 1999 SCC (Cri) 197] that the application of general
principles under the common law to estimate damages
cannot be invoked for computing compensation under the
Motor Vehicles Act. Further, the "pecuniary advantage" from
whatever source must correlate to the injury or death
caused on account of motor accident. The view so taken is
the correct analysis and interpretation of the relevant
provisions of the Motor Vehicles Act of 1939, and must
apply proprio vigore to the corresponding provisions of the
Motor Vehicles Act, 1988. This principle has been restated
in the subsequent decision of the two-Judge Bench
in Patricia Jean Mahajan case [United India Insurance Co.
Ltd. v. Patricia Jean Mahajan, (2002) 6 SCC 281 : 2002
SCC (Cri) 1294] , to reject the argument of the Insurance
Company to deduct the amount receivable by the
dependants of the deceased by way of "social security
compensation" and "life insurance policy".
17. Be that as it may, the term "compensation" has not been
defined in the 1988 Act. By interpretative process, it has
been understood to mean to recompense the claimants for
the possible loss suffered or likely to be suffered due to
sudden and untimely death of their family member as a
result of motor accident. Two cardinal principles run
through the provisions of the Motor Vehicles Act of 1988 in
the matter of determination of compensation. Firstly, the
measure of compensation must be just and adequate; and
secondly, no double benefit should be passed on to the
claimants in the matter of award of compensation. Section
168 of the 1988 Act makes the first principle explicit. Sub-
section (1) of that provision makes it clear that the amount
of compensation must be just. The word "just" means - fair,
adequate, and reasonable. It has been derived from the
Latin word "justus", connoting right and fair. In para 7
of State of Haryana v. Jasbir Kaur [State of
Haryana v. Jasbir Kaur, (2003) 7 SCC 484 : 2003 SCC (Cri)
1671] , it has been held that the expression "just" denotes
that the amount must be equitable, fair, reasonable and not
arbitrary. In para 16 of Sarla Verma v. DTC [Sarla
Verma v. DTC, (2009) 6 SCC 121 : (2009) 2 SCC (Civ) 770 :
(2009) 2 SCC (Cri) 1002] , this Court has observed that the
compensation "is not intended to be a bonanza, largesse or
source of profit". That, however, may depend upon the facts
and circumstances of each case, as to what amount would
be a just compensation.
18. The principle discernible from the exposition in Helen C.
Rebello case [Helen C. Rebello v. Maharashtra SRTC, (1999)
1 SCC 90 : 1999 SCC (Cri) 197] is that if the amount "would
be due to the dependants of the deceased even otherwise",
the same shall not be deductible from the compensation
amount payable under the 1988 Act. At the same time, it
must be borne in mind that loss of income is a significant
head under which compensation is claimed in terms of the
1988 Act. The component of quantum of "loss of income",
inter alia, can be "pay and wages" which otherwise would
have been earned by the deceased employee if he had
survived the injury caused to him due to motor accident. If
the dependants of the deceased employee, however, were to
be compensated by the employer in that behalf, as is
predicated by the 2006 Rules--to grant compassionate
assistance by way of ex gratia financial assistance on
compassionate grounds to the dependants of the deceased
government employee who dies in harness, it is
unfathomable that the dependants can still be permitted to
claim the same amount as a possible or likely loss of income
to be suffered by them to maintain a claim for compensation
under the 1988 Act."
13. There is further reiteration of the above view in the
case of National Insurance Company Ltd.(supra), through Paragraphs-
13 to 23 has come to observe as follows :
"13. In these cases, compensation is claimed against the
tortfeasor who may be the driver or owner of the vehicle or
the insurer. In respect of an accident in which the tortfeasor
is found to be liable, the owner or the driver of the vehicle or
the insurer, as the case may be, may alone be held
responsible for the payment of such compensation since the
accident has resulted in the injury or death which gives rise
to the claim of the claimants. No other party is involved in
it. And certainly not the employer who may offer
compassionate appointment to the dependants of the
injured/deceased.
14. While awarding compensation, amongst other things, the
Tribunal takes into account the income of the deceased and
calculates the loss of such income after making permissible
deductions to compensate the injured claimant for the loss
of earning capacity in case of an injury, and to compensate
the claimants dependent on him in case of death. Thus, the
income of the deceased or the injured, which the claimants
have lost due to the inability of the deceased or the injured
to earn or to provide for them is a relevant factor which is
always taken into consideration. The salary or the income of
the claimant in case of death is generally not a relevant
factor in determining compensation primarily because the
law takes no cognizance of the claimant's situation. Though
in case of an injury, the income of the claimant who is
injured is relevant. In other words, compensation is
awarded on the basis of the entire loss of income of the
deceased or in a case of injury, for the loss of income due to
the injury. What needs to be considered is whether
compassionate appointment offered to the dependants of
the deceased or the injured, by the employer of the
deceased/injured, who is not the tortfeasor, can be
deducted from the compensation receivable by him on
account of the accident from the tortfeasor. Certainly, it
cannot be that the one liable to compensate the claimants
for the loss of income due to the accident, can have his
liability reduced by the amount which the claimants earn as
a result of compassionate appointment offered by another
viz. the employer.
15. The submission on behalf of the appellant in these cases is
that the salary of the claimants receivable on account of
compassionate appointment must be deducted from the
compensation awarded to them. Reliance is placed in this
regard on the judgment of this Court in Bhakra Beas
Management Board v. Kanta Aggarwal [Bhakra Beas
Management Board v. Kanta Aggarwal, (2008) 11 SCC 366 :
(2009) 1 SCC (Cri) 154] in which compensation was claimed
against the employer of the deceased who was also the
owner of the offending vehicle i.e. the tortfeasor. The
tortfeasor offered employment on compassionate grounds to
the widow of the deceased i.e. the claimant. In the facts and
circumstances of the case, this Court took the view that the
salary which flowed from the compassionate appointment
offered by the tortfeasor, was liable to be deducted from the
compensation which was payable by the same employer in
his capacity as the owner of the offending vehicle. We find
this decision as being of no assistance to the appellant in
the cases before us. In the present cases, the owner of the
offending vehicle is not the employer who offered the
compassionate appointment. As observed earlier, it is
difficult to see how the owner can contend that the
compensation which he is liable to pay for causing the
death or disability should be reduced because of
compassionate employment offered by another. In any case,
it is difficult to determine how much the person offered
compassionate appointment would earn over the period of
employment which is not certain, and deduct that amount
from the compensation.
16. At this juncture, it would be apposite to refer to some of the
decisions rendered by this Court. In Helen C.
Rebello v. Maharashtra SRTC[Helen C.
Rebello v. Maharashtra SRTC, (1999) 1 SCC 90 : 1999 SCC
(Cri) 197] , the insurance company had claimed that the
amount which was received by the claimant on account of
life insurance was liable to be deducted from the
compensation which is payable to the claimants. This
contention was rejected by this Court in the following
words: (SCC pp. 112-13, paras 36-37)
"36. As we have observed, the whole scheme of the
Act, in relation to the payment of compensation to the
claimant, is a beneficial legislation. The intention of
the legislature is made more clear by the change of
language from what was in the Fatal Accidents Act,
1855 and what is brought under Section 110-B of the
1939 Act. This is also visible through the provision of
Section 168(1) under the Motor Vehicles Act, 1988
and Section 92-A of the 1939 Act which fixes the
liability on the owner of the vehicle even on no fault.
It provides that where the death or permanent
disablement of any person has resulted from an
accident in spite of no fault of the owner of the
vehicle, an amount of compensation fixed therein is
payable to the claimant by such owner of the vehicle.
Section 92-B ensures that the claim for compensation
under Section 92-A is in addition to any other right to
claim compensation in respect whereof (sic thereof)
under any other provision of this Act or of any other
law for the time being in force. This clearly indicates
the intention of the legislature which is conferring
larger benefit on the claimant. Interpretation of such
beneficial legislation is also well settled. Whenever
there be two possible interpretations in such statute,
then the one which subserves the object of legislation
viz. benefit to the subject should be accepted. In the
present case, two interpretations have been given of
this statute, evidenced by two distinct sets of
decisions of the various High Courts. We have no
hesitation to conclude that the set of decisions, which
applied the principle of no deduction of the life
insurance amount, should be accepted and the other
set, which interpreted to deduct, is to be rejected. For
all these considerations, we have no hesitation to hold
that such High Courts were wrong in deducting the
amount paid or payable under the life insurance by
giving a restricted meaning to the provisions of the
Motor Vehicles Act basing mostly on the language of
English statutes and not taking into consideration the
changed language and intents of the legislature under
various provisions of the Motor Vehicles Act, 1939.
37. Accordingly, we set aside the impugned
judgment dated 9-9-1985 and restore the judgment of
the Tribunal dated 29-9-1980 and hold that the
amount received by the claimant on the life insurance
of the deceased is not deductible from the
compensation computed under the Motor Vehicles
Act. The respondent concerned shall make the
payment accordingly, if not already paid in terms
thereof."
17. Similarly, in United India Insurance Co. Ltd. v. Patricia Jean
Mahajan [United India Insurance Co. Ltd. v. Patricia Jean
Mahajan, (2002) 6 SCC 281 : 2002 SCC (Cri) 1294] , this
Court held that the amount received by the claimants on
account of social security from an employer must have a
nexus or relation with the accidental injury or death, in
order to be deductible from the amount of compensation.
Hence, this Court refused to deduct the said amount from
the amount of compensation receivable on account of the
motor accident.
18. The facts of the case in Vimal Kanwar v. Kishore Dan [Vimal
Kanwar v. Kishore Dan, (2013) 7 SCC 476 : (2013) 3 SCC
(Civ) 564 : (2013) 3 SCC (Cri) 583 : (2013) 2 SCC (L&S) 759]
are similar to the facts of the cases in hand. The contention
in the said case was that the amount of salary receivable by
the claimant appointed on compassionate ground was
deductible from the amount of compensation which the
claimant was entitled to receive under Section 168 of the
Motor Vehicles Act, 1988. This Court rejected the said
contention and observed as follows: (SCC p. 485, para 21)
"21. "Compassionate appointment" can be one of
the conditions of service of an employee, if a scheme
to that effect is framed by the employer. In case, the
employee dies in harness i.e. while in service leaving
behind the dependants, one of the dependants may
request for compassionate appointment to maintain
the family of the deceased employee who dies in
harness. This cannot be stated to be an advantage
receivable by the heirs on account of one's death and
has no correlation with the amount receivable under
a statute occasioned on account of accidental death.
Compassionate appointment may have nexus with
the death of an employee while in service but it is not
necessary that it should have a correlation with the
accidental death. An employee dies in harness even in
normal course, due to illness and to maintain the
family of the deceased one of the dependants may be
entitled for compassionate appointment but that
cannot be termed as "pecuniary advantage" that
comes under the periphery of the Motor Vehicles Act
and any amount received on such appointment is not
liable for deduction for determination of
compensation under the Motor Vehicles Act."
19. In Reliance General Insurance Co. Ltd. v. Shashi
Sharma [Reliance General Insurance Co. Ltd. v. Shashi
Sharma, (2016) 9 SCC 627 : (2016) 3 SCC (Cri) 713 : (2017)
1 SCC (L&S) 90] , this Court permitted the deduction of the
amount receivable by the claimant under the scheme of the
2006 Rules framed by the State of Haryana which provided
a grant of compassionate assistance by way of ex gratia
financial assistance on compassionate grounds to the
members of the family of a deceased government employee
who died while in service/missing government employee.
20. The financial assistance was a sum equal to the pay and
other allowances that were last drawn by the deceased
employee in the normal course without raising a specific
claim for periods up to 15 years from the date of the death
of the employee if the employee had not attained the age of
35 years, and lesser periods of 12 years and 7 years
depending on the age of the employee at the time of death.
The family was eligible to receive family pension only after
the period of financial assistance was completed. The Court
held that ex gratia financial assistance was liable to be
deducted on the ground that the claimant was eligible to it
on account of the same event in which the compensation
was claimed under the Motor Vehicles Act, 1988 i.e. the
death of the employee.
21. This case seems to superficially support the case of the
appellant Insurance Company before us. However, on a
deeper consideration, it does not. In Reliance General
Insurance [Reliance General Insurance Co. Ltd. v. Shashi
Sharma, (2016) 9 SCC 627 : (2016) 3 SCC (Cri) 713 : (2017)
1 SCC (L&S) 90] , the family of the deceased employee
became entitled to financial assistance of a sum equal to
the pay and other allowances that were last drawn by the
deceased for a certain period after his death, even without
raising a specific claim. In other words the family became
entitled to the pay and allowances that the deceased would
have received if he would have not died, for a certain period
of time. This financial scheme resulted in paying the family
the same pay and allowances for a certain period and thus
in effect clearly offsetting the loss of income on account of
the death of the deceased. Thus, the amount of financial
assistance had to be excluded from the loss of income, as to
that extent there was no loss of income, and the
compensation receivable by the family had to be reduced
from the amount receivable under the Motor Vehicles Act.
22. In the present cases, the claimants were offered
compassionate employment. The claimants were not offered
any sum of money equal to the income of the deceased. In
fact, they were not offered any sum of money at all. They
were offered employment and the money they receive in the
form of their salary, would be earned from such
employment. The loss of income in such cases cannot be
said to be set off because the claimants would be earning
their living. Therefore, we are of the view that the amount
earned by the claimants from compassionate appointments
cannot be deducted from the quantum of compensation
receivable by them under the Act.
23. In the cases before us, compensation is claimed from the
owner of the offending vehicle who is different from the
employer who has offered employment on compassionate
grounds to the dependants of the deceased/injured. The
source from which compensation on account of the accident
is claimed and the source from which the compassionate
employment is offered, are completely separate and there is
no co-relation between these two sources. Since the
tortfeasor has not offered the compassionate appointment,
we are of the view that an amount which a claimant earns
by his labour or by offering his services, whether by reason
of compassionate appointment or otherwise is not liable to
be deducted from the compensation which the claimant is
entitled to receive from a tortfeasor under the Act. In such a
situation, we are of the view that the financial benefit of the
compassionate employment is not liable to be deducted at
all from the compensation amount which is liable to be paid
either by the owner/the driver of the offending vehicle or the
insurer."
14. In the case of Sebastiani Lakra & others (supra),
through Paragraph-12 therein has come to observe as follows :
"12. The law is well-settled that deductions cannot be
allowed from the amount of compensation either on account
insurance, or on account of pensionary benefits or gratuity
or grant of employment to a kin of the deceased. The main
reason is that all these amounts are earned by the deceased
on account of contractual relations entered into by him with
others. It cannot be said that these amounts accrued to the
dependants or the legal heirs of the deceased on account of
his death in a motor vehicle accident. The
claimants/dependents are entitled to 'just compensation'
under the Motor Vehicles Act as a result of the death of the
deceased in a motor vehicle accident. Therefore, the natural
corollary is that the advantage which accrues to the estate
of the deceased or to his dependents as a result of some
contract or act which the deceased performed in his life
time cannot be said to be the outcome or result of the death
of the deceased even though these amounts may go into the
hands of the dependents only after his death."
15. In New India Assurance Company (supra), through
Paragraphs-40 and 41 dealing with loss of consortium, i.e. spousal
consortium, parental consortium, filial consortium has come to
observe as follows:
"40. We may also notice the three-Judge Bench judgment of this
Court relied upon by the learned counsel for the appellant
i.e. Sangita Arya v. Oriental Insurance Co. Ltd. [Sangita
Arya v. Oriental Insurance Co. Ltd., (2020) 5 SCC 327 :
(2020) 3 SCC (Civ) 254 : (2020) 2 SCC (Cri) 905] The
counsel for the appellant submits that this Court has
granted only Rs 40,000 towards "loss of consortium" which
is an indication that "consortium" cannot be granted to
children. In the above case, Motor Accidents Claims
Tribunal has awarded Rs 20,000 to the widow towards loss
of consortium and Rs 10,000 to the minor daughter towards
"loss of love and affection". The High Court has reduced
[Oriental Insurance Company Ltd. v. Sangita Arya, 2016
SCC OnLine Utt 970] the amount of consortium from Rs
20,000 to Rs 10,000. Para 16 of the judgment is to the
following effect: (Sangita Arya case [Sangita Arya v. Oriental
Insurance Co. Ltd., (2020) 5 SCC 327 : (2020) 3 SCC (Civ)
254 : (2020) 2 SCC (Cri) 905], SCC p. 330, para 10)
"10. The consortium payable to the widow was
reduced [Oriental Insurance Company Ltd. v. Sangita
Arya, 2016 SCC OnLine Utt 970] by the High Court
from Rs 20,000 (as awarded by MACT) to Rs 10,000;
the amount awarded towards loss of love and
affection to the minor daughters was reduced from Rs
10,000 to Rs 5000. However, the amount of Rs 5000
awarded by MACT towards funeral expenses was
maintained."
41. This Court in the above case confined its consideration
towards the income of the deceased and there was neither
any claim nor any consideration that the consortium should
have been paid to other legal heirs also. There being no
claim for payment of consortium to other legal heirs, this
Court awarded Rs 40,000 towards consortium. No such
ratio can be deciphered from the above judgment that this
Court held that consortium is only payable as a spousal
consortium and consortium is not payable to children and
parents."
16. In the case of National Insurance Company Ltd.
Vrs. Birender and others : (2020) 11 SCC 356 through Paragraphs-
19 and 21, while taking into account deduction of the amounts from
compensation held only tax amount can be deducted. This Court takes
note of the observation of the Hon'ble apex Court through paragraphs-
19 and 21, which reads as follows :
19. Reverting to the determination of compensation amount, it
is noticed that the Tribunal proceeded to determine the
compensation amount on the basis of net salary drawn by
the deceased for the relevant period as Rs.16,918/- per
month, while taking note of the fact that her gross salary
was Rs.23,123/- per month (presumably below taxable
income). Concededly, any deduction from the gross salary
other than tax amount cannot be reckoned. In that, the
actual salary less tax amount ought to have been taken into
consideration by the Tribunal for determining the
compensation amount, in light of the dictum of the
Constitution Bench of this Court in para 59.3 of Pranay
Sethi [National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16
SCC 680 : (2018) 3 SCC (Civ) 248 : (2018) 2 SCC (Cri) 205].
21. Be that as it may, the Tribunal, for excluding the amount
received by the deceased as family pension due to demise of
her husband, had noted in para 26, as under:
"26. The learned counsel for the claimants further
requested that about to family pension being drawn
by the deceased also be calculated for the purpose of
assessing the compensation. This contention and
assertion of the learned counsel for the claimants
does not carry any conviction with the Tribunal
because the deceased was getting family pension in
her own right as the widow of the deceased and
cannot be termed as her income for the purpose of
computing the amount of compensation."
The High Court, without reversing the said
finding, proceeded to include the amount of Rs 7000
per month received by the deceased as pension
amount after the demise of her husband. We are in
agreement with the view taken by the Tribunal and
for the same reason, have to reverse the conclusion
recorded by the High Court to include the said
amount as loss of dependency. That could not have
been taken into account, as the same was payable
only to the deceased being widow and not her income
as such for the purpose of computing the amount of
compensation."
17. In another recent decision in the case of Erudhaya
Priya Vrs. State Express Transport Corporation Ltd. : 2020 SCC
Online SC 601, dealing with even in the case of permanent disability
in paragraph-14 has come to hold as follows:
"We are, thus, unequivocally of the view that
there is merit in the contention of the appellant and
the aforesaid principles with regard to future
prospects must also be applied in the case of the
appellant taking the permanent disability as 31.1%.
The quantification of the same on the basis of the
judgment in National Insurance Co. Ltd. case (supra),
more specifically para 59.3, considering the age of the
appellant, would be 50% of the actual salary in the
present case.
(c) The third and the last aspect is the interest
rate claimed as 12%"
18. Now coming to decide on the claim of the Insurance
Company in their challenge to grant of compensation @50% of future
prospect in spite of a service being provided to the family members of
the deceased through a catena of decisions taken note hereinabove,
this Court finds the settled position remain to be employment under
the provisions of compassionate appointment scheme since provided
by virtue of an agreement between an employee and employer remain
excluded from the compartment of compensation and there cannot be
any deduction on this head. Be it stated here that even though
Insurance Company has filed appeal on the above ground based on
their objection in the written statement neither the Insurance
Company choose to ask the Tribunal to frame any issue on such
aspect nor as it appears, they led any evidence on this aspect.
Consequently reading of the judgment also discloses that there is no
submission even on this aspect, thus this Court observes, a pleading
not asked to be considered through framing of issue and in absence of
at least evidence on such scoring amounting to abandonment of such
aspect and cannot be taken into consideration even otherwise. Be that
as it may, for the settled position of law, this Court negative the plea of
the Insurance Company to reduce the compensation amount taking
into consideration the compensation amount through future prospect
by taking into account the employment of one of the family members
of the deceased through rehabilitation assistance scheme.
19. Similarly, coming to claim of Insurance Company for
deduction on other accounts, for the catena of decisions of the Hon'ble
apex Court reproduced hereinabove, this Court finds none of the
grounds agitated by the Insurance Company remains sustainable in
the eye of law. This Court therefore observes the appeal at the
instance of the Insurance Company, i.e. MACA No.774 of 2016 has to
be simply dismissed and as such, MACA No.774 of 2016 stands
dismissed.
20. Coming to the claim of the learned counsel for the
claimant involving appeal, i.e. MACA No.593 of 2016, this Court finds
even though the claimant party is entitled to compensation under the
head of loss of estate, loss of love and affection, loss of consortium as
well as some amount towards litigation expenses, from the discussions
in the judgment, learned Tribunal while computing the compensation
even though discussed the compensation towards funeral expenses
and granted a sum of Rs.1,00,000/- (Rupees one lakh), for the opinion
of this Court, taking into account the grant of compensation of
Rs.48,83,355/- (Rupees Forty eight lakhs eighty three thousand three
hundred fifty five) only, apart from the bereaved family got the
premature superannuation benefits on the head of the deceased and
also an employment under rehabilitation assistance scheme, this
Court observes grant of Rs.1,00,000/- towards funeral expenses be
considered as compensation towards funeral expenses, loss of estate
as well as loss of love and affection. In the above view, this Court is
not inclined to grant any further amount on the above heads except
directing to treat grant of Rs.1,00,000/- (Rupees one lakh) only
towards funeral expenses as expenses on the head of loss of estate
and for loss of love and affection as well as loss of consortium.
21. It is in this view of the matter, this Court dismisses
both the appeals thereby confirming the judgment of the First
Additional District Judge-cum-1st Motor Accident Claims Tribunal,
Cuttack involving MAC No.113 of 2011. Before parting with the
judgment, this Court likes to observe, since the Insurance Appeal was
mostly involving an attempt to reduce the compensation while
entertaining such appeals, the High Court should remain careful and
looking to the limited challenge issue direction for at least release of
75% of the compensation amount along with interest to protect the
interest of the bereaved family. Release of balance amount may be
subject to final outcome involving litigation in this Court.
22. For the dismissal of both Appeals, this Court directs
the Insurance Company to deposit the whole amount along with
interest as awarded by the Tribunal within a period of one and half
months from the date of judgment and considering that Claimant
nos.2 to 4 have already gone major in the meantime, the Tribunal is
directed keeping in view that the award was passed in the year 2016
and the Claimants are entitled to interest @7% p.a. from 05.03.2011,
the matter is remitted back to the Tribunal for modifying its order on
the aspect of manner of release in favour of Claimant no.1 and the
amount required to be kept under Fixed Deposit in respect of all the
respondents and also the amount now to be released in favour of
Claimant no.1, wife of the deceased by undertaking the entire exercise
within a period of three weeks from the date of receipt of copy of the
judgment. The matter is remitted back only for the purpose of re-
calculation of the whole compensation and for determination of the
mode of release and Fixed Deposit in respect of the Claimants.
23. With the above direction, both the Appeals are
dismissed. There shall be no order as to cost.
..............................
Biswanath Rath, J.
Orissa High Court, Cuttack.
The 5th April, 2021/MKR, A.R.-cum-Sr.Secy/UKS, P.A.
