Ramakrishna Upadhyay & Another vs Rajesh Kumar Pandey & Another
2026 Latest Caselaw 1993 Ori

Orissa High Court

Ramakrishna Upadhyay & Another vs Rajesh Kumar Pandey & Another on 6 March, 2026

Author: G. Satapathy

Bench: G. Satapathy

     IN THE HIGH COURT OF ORISSA AT CUTTACK
             MACA Nos.966 & 1243 of 2023
(In the matter of application under Section-173 of M.V. Act,
1988).
                  MACA No.966 of 2023

Ramakrishna Upadhyay & another ...                     Appellants

                                      Mr. D.C. Dey, Advocate
                           -versus-
Rajesh Kumar Pandey & Another              ...    Respondents

                       Mr. B. Dasmohapatra, Advocate(R-2)
                   MACA No.1243 of 2023
Sr. Divisional Manager, M/S. the   ...       Appellant
New India Assurance Co. Ltd.,
                        Mr. B. Dasmohapatra, Advocate
                           -versus-
Ramakrishna Upadhyay & another ...                Respondents
                           Mr. D.C. Dey, Advocate(R-1 & 2)
            CORAM: JUSTICE G. SATAPATHY
           DATE OF HEARING & JUDGMENT: 06.03.2026
G. Satapathy, J.

1. Since these two appeals involve common

question of facts and law, the same are taken up and

heard together and disposed of by this common

judgment.

2. The impugned judgment dated 16.09.2023

passed by learned 3rd Motor Accident Claims Tribunal,

Cuttack (hereinafter referred to as "the learned tribunal)

in MAC Case No.1258 of 2019 is under challenge in both

these appeals filed U/S.173(1) of the Motor Vehicles Act,

1988 (in short "the Act").

2.1 By the impugned judgment, the Insurance

Company-M/S. New India Assurance Co. Ltd. (in short the

"insurer") is directed to pay a sum of Rs. 1,14,51,118/-

together with simple interest @ 6% per annum w.e.f.

14.10.2019 till its actual realization to the claimants-

applicants as compensation for the death of one

Suryakant Upadhyay (hereinafter referred to as "the

deceased") in a motor vehicular accident with further

stipulation of payment of penal interest @ 12% per

annum on the compensation amount so assessed, if the

same is not paid within two months from the date of

passing of the impugned judgment.

3. These two appeals arise out of one

proceeding for compensation before learned tribunal for

the death of the deceased in vehicular accident that took

place on 03.09.2019 at about 10.50 AM when the

deceased was coming from NTPC Darlipali to Sundargarh

along with his colleague namely Susmita Kaviraj on a

scooty bearing Registration No.TS-22A-7481, suddenly a

trailer bearing Registration No. OD-16-D-3941

(hereinafter referred to as the "offending vehicle")

coming in a rash and negligent manner and dashed the

scooty at Sadar Chowk, Bandhapali, Sundargarh resulting

in death of the deceased. The accident was in fact

registered vide Sundargarh Sadar PS Case No. 170 of

2019 which culminated in submission of charge sheet,

but the legal representatives(claimants) of the deceased

approached the learned tribunal in an application U/S.

166 of the Act, for grant of compensation towards death

of the deceased by impleading the owner and the insurer

of the offending vehicle and claiming the deceased to be

earning Rs. 70,439/- per month from his salary and the

accident causing loss of not only the life of their sole

bread earner, but also for losing the amount so

contributed by the deceased to the family. Accordingly,

the claim of the applicants was registered vide MAC Case

No. 1258 of 2019.

4. In response to the notice in MAC Case No. 1258

of 2019, the owner of the offending vehicle did not

appear and he was accordingly set exparte, but the

insurer of the offending vehicle contested the claim by

filing written statement denying its liability and inter-alia

asserting the claim to be not maintainable either in law or

facts on the ground of deceased dying in the motor

vehicular accident due to his own negligence. In addition,

the insurer in its written statement had not only disputed

the age, occupation and income the deceased, but also

had disowned its liability to indemnify the owner of the

offending vehicle for the driver being not in possession of

a valid and effective driving license.

5. On inter se pleadings between the parties, the

learned tribunal stuck as many as five issues and allowed

the parties to lead the evidence. The claimant accordingly

examined three witnesses vide PW1 to PW3 and relied

upon 23 documents under Ext.1 to Ext.23 as against no

evidence whatsoever by the insurer. After analyzing the

evidence on record upon hearing the parties, the learned

tribunal passed the impugned judgment directing the

insurer to pay the compensation amount as indicated

supra. Being aggrieved with the impugned judgment, the

claimants-applicants preferred appeal in MACA No.966 of

2023 challenging the quantum of compensation, whereas

the insurer challenged such impugned judgment in the

appeal in MACA No.1243 of 2023 on various grounds

including grant of compensation to the claimant ignoring

the rehabilitation assistance employment provided to one

of the claimants; imposition of penal interest and last but

not the least, the quantum of compensation awarded by

ignoring to deduct the income tax amount required to be

paid by the Deceased.

6. Heard, Mr. Durga Charan Dey, learned counsel

for the claimants-appellants in MACA No.966 of 2023 and

Respondent No.1 & 2 in MACA No.1243 of 2023 and Mr.

Bijoy Dasmohapatra, learned counsel for the Insurer-

appellant in MACA No.1243 of 2023 and Respondent No.2

in MACA No.966 of 2023. None appears for the owner-

respondent despite being duly noticed in the appeals.

7. Admittedly, the appeal filed by the insurer seeks

to challenge the impugned judgment for ignoring to take

into account the rehabilitation assistance employment

under NTPC Employees' Family Economic Rehabilitation

Scheme (in short "NEFERS") by one of the claimants, but

such assertion of the appellant appears to be imaginary

inasmuch as neither there is any evidence to indicate that

any of the claimants has/had availed the benefit under

the NEFERS which is meant for providing rehabilitation

assistance employment and the same is in fact confirmed

by the letter issued by the Sr. Assistant Officer(HR), NTPC

vide reference No. 1070/NTPC DLCMP/2024/HR dated

25.04.2024 in which it is stated that as the deceased was

a trainee at the time of accident, he did not meet the

eligibility criteria outlined in clause-3.1 of the NEFERS

and, therefore, he was not entitled to the benefit under

the said scheme. In view of the aforesaid fact and in

absence of any evidence, it is made clear that none of the

claimants-applicant has availed any benefit under NEFERS

so as to dispute the impugned judgment on that score.

8. On coming back to the next challenge of the

insurer, it appears that the learned tribunal has imposed

penal interest @ 12% per annum, if the award is not

satisfied within two months of the passing of the

impugned judgment, but such observation of the learned

tribunal is unsustainable in the eye of law, since Section

171 of the Act provides for awarding interest on the

award, but law does not contemplate about imposition of

default penal interest and thereby, the imposition of

penal interest on the award appears to be unsustainable

in the eye of law and is accordingly, waived out.

9. On coming to the core issues of the quantum of

compensation which is challenged by both the insurer and

the claimants, it appears that the learned tribunal has

computed the compensation to the claimants under issue

No.3 at Paragraph-8 of the impugned judgment and the

learned tribunal has accordingly took the income of the

deceased @ Rs.77,940/- per month and net pay of Rs.

70,439/- after deducting Rs. 7,501/- towards Income tax,

professional tax and Sneha Kiran Contribution, but the

learned tribunal has erred in deducting income tax from

the monthly salary of the deceased inasmuch as income

tax is calculated on the annual income of the individual

employee. In this case, the claimant has proved the

monthly salary of the deceased for the month of July &

August-2019 under Exts. 21 and 22 which could not be

validly disputed by the insurer and it is found from the

impugned judgment that the salary of the deceased for

the month of July-2019 was Rs.77,940/- and, therefore,

the gross annual income of the deceased would come

around Rs. 77,940/-X 12=Rs. 9,35,280/-. Adding 50% to

the aforesaid gross annual income of the deceased

towards future prospects, it would come around Rs.

9,35,280/- + Rs. 4,67,640/- (50% of 9,35,280/-) =Rs.

14,02, 920/-, but since the deceased died as bachelor,

50% of 14,02, 920/ = Rs.7,01,460/- is to be deducted

towards his personal and living expenses and the yearly

loss of dependency of the claimants would come to

Rs.7,01,460/-. Since the annual income of the deceased

was considered for the Financial Year of 2019-20,

assessment year of 2020-21 would be considered

relevant, but no evidence or material has been produced

by either of the parties to show any tax paid by the

deceased for the assessment year 2020-21. In absence of

any evidence and materials, this Court, however,

considers it proper to deduct 10% from the aforesaid

amount towards income tax of the deceased and thereby,

the net amount would be come around Rs.7,01,460/-

(minus)10% of Rs.7,01,460/- = Rs. 6,31,314/- which is

further liable for deduction of Rs. 8,400/- (Rs. 2400/- +

Rs. 6,000/- which were the amount paid by the deceased

annually towards professional tax and Sneha Kiran

Contribution in addition to his income tax) and thereby,

the net amount come to Rs. 6,31,314/- (minus) Rs.

8,400/- = Rs. 6,22,914/- which amount eligible for

calculation of loss of dependency of the claimants.

Accordingly, the loss of dependency of the claimants is

calculated at Rs. Rs. 6,22,914/- X 18(multiplier as the

deceased was aged about 22 years at the time of his

death)=Rs. 1,12,12,452/- and by adding to it, a sum of

Rs. 98,000/- which includes 10% increase for every three

years for four escalation, towards general damages under

conventional heads of loss of estate, loss of consortium

and funeral expenses, the net compensation amount

payable to the claimants would come around Rs.

1,12,12,452/- + Rs. 98,000/- =Rs. 1,13,10,452/-

together with simple interest @ 6 % per annum w.e.f

14.10.2019 till its actual realization.

10. In the result, the appeal by the insurer in

MACA No.1243 of 2023 is allowed in part, but the appeal

by the claimants in MACA No. 966 of 2023 is dismissed

on contest, however, there is no order as to costs.

Accordingly, the impugned judgment is modified to the

extent indicated above and the insurer is hereby directed

to pay the modified compensation amount of Rs.

1,13,10,452/- together with simple interest @6% per

annum w.e.f 14.10.2019 till its actual realization to the

claimants-respondents by depositing the same before the

learned Tribunal within eight weeks hence. On such

deposit of modified compensation amount, the same shall

be disbursed to the claimants proportionately in terms of

the award and the appellant-insurer be refunded back

with the statutory deposit together with the accrued

interest thereon.

(G. Satapathy) Judge

Orissa High Court, Cuttack,

Dated the 6th day of March, 2026/Priyajit

Location: HIGH COURT OF ORISSA Date: 07-Mar-2026 18:21:49