Gujarat High Court
United India Insurance Company Ltd vs Yuvrajsinh Shivlal Charan on 26 July, 2018
Author: Akil Kureshi
Bench: Akil Kureshi, B.N. Karia
C/FA/4012/2014 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 4012 of 2014
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE AKIL KURESHI
and
HONOURABLE MR.JUSTICE B.N. KARIA
==========================================================
1 Whether Reporters of Local Papers may be allowed to
see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of the
judgment ?
4 Whether this case involves a substantial question of law
as to the interpretation of the Constitution of India or any
order made thereunder ?
==========================================================
UNITED INDIA INSURANCE COMPANY LTD
Versus
YUVRAJSINH SHIVLAL CHARAN
==========================================================
Appearance:
MR MAULIK J SHELAT(2500) for the PETITIONER(s) No. 1
MR KIRAN C MEHTA(2718) for the RESPONDENT(s) No. 1.1,1.2,1.3
RULE SERVED(64) for the RESPONDENT(s) No. 1.4,1.5,1.6,3
UNSERVED REFUSED (R)(70) for the RESPONDENT(s) No. 2
==========================================================
CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI
and
HONOURABLE MR.JUSTICE B.N. KARIA
Date : 26/07/2018
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE AKIL KURESHI)
1. This appeal is filed by the insurance company challenging the judgment and award passed by the Page 1 of 8 C/FA/4012/2014 JUDGMENT Motor Accident Claims Tribunal, Gandhidham, on 08.08.2014.
2. Brief facts are as under.
3. On 15.09.2001, one Yuvrajsinh Charan was coming towards Gandhidham from Rajasthan in his motorcar along with his family when the vehicle collided with a tanker coming from the opposite side causing fatal injuries to Yuvrajsinh. His dependents i.e. widow, three minor children and aged parents therefore filed the Claim Petition seeking compensation of Rs.30,00,000/ from the driver, owner and insurer of the tanker involved in the accident. The Claims Tribunal held the driver of the tanker solely negligent in causing the accident and awarded a compensation of Rs.29,96,500/ to the claimants. The insurance company has challenged this award only on the ground of quantum. We have therefore paid our attention only to this aspect of the matter.
4. According to the claimants, the deceased was employed in a private firm called Damani Shipping. Deceased was working as a manager of the firm at Kandla and drawing monthly salary of Rs.13,000/. He Page 2 of 8 C/FA/4012/2014 JUDGMENT was also allowed to do his own work separately. In support of the income statement, the claimants examined one Manish Nagar at Exh.29 who was the manager of the Damani Shipping in the Kutch region. He deposed on the basis of certificate issued by the employer company. He produced the certificate dated 14.03.2002 which showed that the deceased was drawing a salary of Rs.13,000/ per month at the time of the accident. He clarified that the deceased was also allowed to do his own work. In the cross examination, he agreed that he had not brought the pay slip of the deceased. He did not know the deceased personally.
5. Claimants also examined one Jitudan Gadhvi at Exh.30 who deposed that he was working for the deceased as his supervisor in the year 2001, for which, he was paid Rs.5,000/ per month. Yuvrajsinh was engaged in the works of customs clearing. Besides working for Damani brothers, he was doing such works for other firms called Vijay Fashions Private Limited and Vijay Lumbers. He stated that along with him, the deceased had employed another person as a clerk cumaccountant and yet another person as a customs Page 3 of 8 C/FA/4012/2014 JUDGMENT clearing agent.
6. The Claims Tribunal believed the income of the deceased at Rs.13,000/ p.m., deducted 1/4th thereof for the personal expenditure of the deceased and applied a multiplier of 17. The Tribunal thereafter added Rs.10,000/ for loss of estate and consortium and Rs.3,000/ for funeral expenses and arrived at a grand total of Rs.29,96,500/.
7. Counsel for the insurance company submitted that;
(I) There was no reliable proof of the income of the deceased. The Tribunal therefore erred in believing his monthly income of Rs.13,000/. (II) In any case, there was no deduction for income tax which should have been made. (III)Multiplier of 15 instead of 17 should have been applied looking to the age of the deceased.
8. Counsel for the claimants however opposed the appeal contending that in addition to permanent work of Damani brothers, the deceased was also looking after the customs clearance work of several other Page 4 of 8 C/FA/4012/2014 JUDGMENT firms, for which, he had employed sufficient staff. The Tribunal correctly assessed the income. In fact, the compensation under the conventional heads is not adequate.
9. As noted, the claimants had examined two witnesses; Manish Nagar, area manager of Damani shipping for Kutch region. On the basis of certificate issued by the firm, he has deposed before the Court that the deceased was employed for the salary of Rs.13,000/. He was also free to do his freelance work. We have no reason to discard this evidence and supporting documentary proof of the salary of the deceased. However, the attempt on the part of the claimants to establish further income of the deceased through the evidence of Jitudan Gadhvi cannot succeed. The said claimants have not produced any documentary proof of engaging the deceased independently as a customs clearing agent.
10. Even the income of Rs.13,000/ per month believed by us must have income tax deduction. We have referred to the provisions of the Income Tax Act prevailing at the relevant time, according to which, Page 5 of 8 C/FA/4012/2014 JUDGMENT initial income of Rs.50,000/ per annum was tax free. Thereafter there were tax slabs of 10%, 20% and 30% on the total income of Rs.60,000/, Rs.1,50,000/ and above respectively. Any person earning a sizable income could also be expected to make investments in savings schemes which would qualify for tax deductions and exemptions. Considering totality of the facts and circumstances of the case, therefore, we assessed yearly tax liability of the deceased at Rs.12,000/ to round off his take home salary at Rs.12,000/ per month.
11. The date of birth of the deceased brought on record was 27.09.1966. The accident took place on 15.09.2001. On the date of accident thus, the deceased had completed 35 years of age but not completed 36 years. The Supreme Court in case of Sarla Verma & Ors. v. Delhi Transport Corporation & Anr reported in (2009) 6 SCC 121 has prescribed multiplier of 16 for the deceased in the age group of 31 to 35 years. For the person in the age group of 36 to 40 years, the multiplier would be reduced to
15. In the present case, the Tribunal has granted multiplier of 17 which certainly requires reduction. Page 6 of 8
C/FA/4012/2014 JUDGMENT However, when the Supreme Court in case of Sarla Verma & Ors. (supra) has provided the multiplier of 16 for the age group of 31 to 35 years and multiplier of 15 for the age group of 36 to 40 years, we cannot read such declaration as to apply a lower multiplier unless and until the person has completed 36 years of age. When the Court therefore provide of multiplier of 15 for a person in the age group of 36 to 40 years, such a multiplier would apply only after the person crosses the age of 36 years. Till that stage, he would be covered under the earlier prescription of multiplier of 16 for the age group of 31 to 35 years.
12. Deduction of 1/4th for the personal expenditure of the deceased would apply. Under the conventional figures, the claimants would receive a total of Rs.70,000/ as suggested by Supreme Court in case of National Insurance Company Ltd. v. Pranay Sethi and Ors. reported in 2017 (3) GLR 536. As per this judgment therefore, there will be 40% rise in the future income of the deceased.
13. In the result, the loss of dependency benefit would be worked out as under.
Page 7 of 8
C/FA/4012/2014 JUDGMENT
14. Income of the deceased on the date of the accident Rs.12,000/ per month. 40% rise in the future income i.e. Rs.4800/ would make the prospective income at Rs.16,800/ p.m. or Rs.2,01,600/ per annum. 1/4th or Rs.50,400/ would be set apart for the deceased himself, leaving a net of Rs.1,51,200/ for the family. A multiplier of 16 would make the loss of dependency benefit to Rs.24,19,200/ rounded off to Rs.24,20,000/. Increase of Rs.70,000/ would make the grand total of Rs.24,90,000/. The Tribunal having granted Rs.29,96,500/ there will be reduction of Rs.5,06,500/. Such excess amount may be returned to the insurance company with proportionate cost and interest. The remaining amount may be released in favour of the claimants.
15. First Appeal is disposed of accordingly. R & P to be transmitted back to the trial Court.
(AKIL KURESHI, J) (B.N. KARIA, J) ANKIT SHAH Page 8 of 8