Himachal Pradesh High Court
Mandeep Kaur & Others vs Gayyur Alam & Others on 12 September, 2019
Author: Vivek Singh Thakur
Bench: Vivek Singh Thakur
1
IN THE HIGH COURT OF HIMACHAL PRADESH
SHIMLA
FAO No. :4086 of 2013
Reserved on : 06.09.2019
Date of Decision: 12.09.2019
.
Mandeep Kaur & Others ...Appellants
Versus
Gayyur Alam & Others ...Respondents
Coram:
The Hon'ble Mr. Justice Vivek Singh Thakur, Judge.
Whether approved for reporting?1. Yes
For the Appellants: Mr. Manohar Lal Sharma, Advocate, for appellants.
For the Respondents: Ms. Sunita Sharma, Sr. Advocate with
r Ms.Saraswati, Advocate, for respondents No.1 and
2.
Mr.Jagdish Thakur, Advocate, for respondent No.3.
Vivek Singh Thakur, J.
This appeal has been preferred by the appellants for enhancement of compensation determined by the Motor Accident Claims Tribunal-II, Solan (hereinafter referred to as the MACT) on account of death of Amar Pal Singh in a motor accident occurred on 16.10.2011.
2. I have heard the learned counsel for parties and have also gone through the record.
3. Appellant No.1 is wife, appellant Nos. 2 and 3 are daughters and appellant No. 4 is mother of deceased Amar Pal Singh.
4. It is not in dispute that deceased was an employee in Northern Railway and his gross pay, drawn in the month of September, 2011, was Rs.31201/- per month and he had expired on 16.10.2011. Liability of respondent 1 Whether reporters of the local papers may be allowed to see the judgment? Yes ::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 2 No.3 Insurance Company to pay compensation on account of the said death, as determined by the MACT, is also admitted. After considering material on record the MACT has awarded compensation of Rs.29,45,420/-along with interest @9% per annum from the date of filing petition till deposit of awarded amount .
5. First ground for enhancement of compensation, as canvassed by learned counsel for appellants, is that the MACT has committed an error by deducting 10% income tax from the income of deceased for determining the compensation amount. To substantiate his plea, he has referred a judgment of Hon'ble Apex Court in case Vimal Kanwar & Ors Vs. Kishore Dan & Ors, 2013 (7) SCC 47.
6. Learned Counsel for the Insurance Company has disputed this claim by contending that salary during the year when death of Amar Pal Singh was caused in the accident, was beyond the limit exempted from the income tax as on the basis of Last Pay Certificate, his gross pay was Rs.31,201/- and in any case, during that year he was entitled for deduction of Rs.1,80,000/- from his annual income and was liable to income tax on the rest of annual income and for determining just and fair amount of compensation, amount of income tax, which would have been payable, is to be deducted. .
7. In Vimal Kanwar's case, the Apex Court had disallowed the deduction of Income Tax on the ground that none of the respondents had brought to the notice of the Court that income tax payable by the deceased was not deducted at source by the employer State-Government and no such statement was made by the witnesses examined in the Court and further that the Tribunal and High Court, on perusal of Last Pay Certificate, had not noticed that income tax on the estimated income of the employee was not deducted from the salary of the employee during the said month or financial year and in absence of such ::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 3 evidence, it was presumed that salary was paid to the deceased in accordance with law i.e. by deducting income tax on the estimated income of the deceased for the month or the financial year.
8. In the present case, Last Pay Drawn Certificate is Ext. PW-
.
1/E, and perusal thereof reveals that employer has not only given the details of gross pay drawn by deceased but also deductions made to the gross salary of the deceased and in the said certificate, after detailed total deductions as Rs.8,401/-
from the gross pay of deceased, his net pay has been reflected as Rs.22,800/-. In details of deductions none of the deductions, indicated in Ext. PW-1/E by the employer, is towards income tax. Therefore, for positive evidence on record with respect of non-deduction of income tax, the pronouncement of the Apex Court in Vimal Kanwar's case is not applicable to the facts of present case. As held by the Apex Court in National Insurance Company Vs. Pranay Sethi and others (2017) 16 SCC 680, established income means the income minus tax component. Accordingly plea of appellant on this ground is rejected.
9. However, it is noticeable that the MACT had deducted income tax @10% from the total annual income of the deceased whereas before calculating and deducting it, the basic exempted income of Rs.1,80,000/- for financial year 2011-12 and deduction under Section 80C of Income Tax Act were to be deducted from total annual income. Gross salary of deceased was Rs.31,201/-, which gives annual income of Rs.3,74,412/- and after deducting Rs.1,80,000/-
(basic exempted income in Financial Year 2011-12), in Financial Year 2011-12, deduction under Section 80C of Income Tax Act was available upto Rs.1,00,000/-. But in Last Pay Certificate Ext.PW1/E, monthly contribution towards Provident Fund (PF) and Central Group Insurance Scheme (CGIS) of Rs.1563+Rs.30=Rs1593 has been reflected which gives yearly contribution for ::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 4 Rs.19,116/-. Before calculating tax on income, this amount was also to be deducted as there is no other evidence on record with respect to such contribution by deceased, if any. In this manner, taxable income would be Rs.1,75,296/- and tax thereon @ 10% would be Rs.17,530/-. After deducting the tax, annual income .
of deceased would be Rs.3,56,882/-. Therefore, balance annual income as determined by the MACT, after deducting income tax amounting to Rs.37,441/-
was wrong. Accordingly, annual income of deceased after deduction of income tax is to be considered as Rs.3,56,882/-.
10. Considering Sarla Verma's and Pranay Sethi's cases (supra), 30% additional amount is required to be added in the annual income of deceased as future enhancement in salary as deceased was 47 years of age at the time of accident. By adding 30% i.e. Rs1,07,065/- in Rs.3,56,882/-, the annual income of deceased comes to Rs.4,63,947 /-.
11. Second ground for enhancement, raised on behalf of appellant is that the MACT has wrongly made deduction of One-third (1/3rd) on account of personal living expenses from the total income whereas in the present case deduction of one-fourth (1/4th) of total income was permissible. On this issue law is well settled and has been explained by the Apex Court in Sarla Verma & Others Vs. Delhi Transport Corporation and another (2009) 6 Supreme Court Cases 121 which provides that if number of dependents of family members is 4 to 6, deduction towards personal and living expenses of the deceased should be 1/4th. In present case, number of dependent family members is 4, therefore, 1/4th deduction towards personal and living expenses of the deceased, out of the total income of the deceased, is permissible. After deducting 1/4th from annual income i.e. 1,15,987/-, annual loss of dependency becomes Rs.3,47,960/-.
::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 512. Third ground, contended for enhancement of compensation, is that deceased was 47 years of age and for the age between 46 to 50 years, multiplier of 13 was to be applied for calculating total loss of dependency whereas the MACT has applied the multiplier of 10 without any reasoning. Learned counsel for the .
Insurance Company, for settled law of the land in Sarla Verma's case supra, has no reason to dispute it. Therefore, on this count plea for enhancement of compensation is justified and the award of the MACT is required to be modified on this count also. Accordingly, after applying the multiplier 13 to the annual loss of dependency 3,47,960/-, the total loss of dependency becomes Rs.45,23,480/-.
13. At last learned counsel for the appellants relying upon pronouncement of the Hon'ble Apex Court in Civil Appeal No. 9581 of 2018 titled as Magma General Insurance Co. Ltd. Vs. Nanu Ram alias Chuhru Ram & Ors, decided on 18.09.2018, reported in (2018) SCC online SC 1546 has pleaded that instead of Rs.40,000/- awarded for loss of consortium, appellants are also entitled for additional amount for loss of spousal, parental and filial consortium. This plea has been opposed on behalf of Insurance Company on the ground that amount of compensation to be awarded for loss of consortium will be governed by the principle of awarding compensation under loss of consortium as laid down in Pranay Sethi's case (supra) wherein it is held that reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs.15,000/-, Rs.40,000/- and Rs.15,000/-, respectively and the said amount is to be enhanced @ 10% in every three years after passing of the said judgment. The judgment in Pranay Sethi's case was pronounced on 31st October, 2017 and three years thereafter will be completed in the month of October, 2020.
::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 614. Learned counsel for Insurance Company has also opposed the claim of the appellant for awarding an amount more than Rs.40,000/- for loss of spousal, parental and filial consortium on the ground that judgment passed by a Bench of smaller strength will not prevail over pronouncement of a larger Bench .
and thus guidelines framed by five-Judge Bench in Pranay Sethi's case shall prevail over judgment passed by two-Judge Bench in Magma General Insurance Company Limited's case. He has also placed reliance upon an order dated 1.8.2019, passed by the Apex Court in Civil Appeal No.6020 of 2019, titled as Cholamandalam M/s General Insurance Company Ltd. v. Aarifa & others, arising out of SLP (Civil) No.6944 of 2018, wherein it is observed that compensation under the non-conventional heads could not have been awarded in excess of Rs.70,000/- and thus he has contended that appellants are not entitled for any amount for spousal, filial and parental consortium which is beyond the limits provided in guidelines issued by five-Judge Bench in Pranay Sethi's case.
15. In Pranay Sethi's (Constitution Bench) case, it has been directed that reasonable figures on head of loss of consortium should be Rs.40,000/-, but it is not clear that where there are more than one claimants, amount of Rs.40,000/-
is to be awarded to them collectively or individually. Loss of consortium is an individual loss to each claimant. It has been explained and clarified by the Hon'ble Supreme Court in later judgment in Magma General Insurance Co.'s case, wherein Rs.40,000/- each, for loss of Filial consortium, has been awarded to both claimants, who were father and sister of the deceased. In this case the Apex Court, explaining the meaning of "consortium", has held as under:-
"8.7. A Constitution Bench of this Court in Pranay Sethi (supra) dealt with the various heads under which compensation is to be awarded in a death case. One of these heads is loss of consortium.::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 7
In legal parlance, "consortium" is a compendious term which encompasses 'spousal consortium', 'parental consortium', and 'filial consortium'.
The right to consortium would include the company, care, help, comfort, guidance, solace and affection of the deceased, which is a loss to his family. With respect to a spouse, .
it would include sexual relations with the deceased spouse.
Spousal consortium is generally defined as rights pertaining to the relationship of a husband-wife which allows compensation to the surviving spouse for loss of "company, society, co-operation, affection, and aid of the other in every conjugal relation."
Parental consortium is granted to the child upon the premature death of a parent, for loss of "parental aid, protection, affection, society, discipline, guidance and training."
Filial consortium is the right of the parents to compensation in the case of an accidental death of a child. An accident leading to the death of a child causes great shock and agony to the parents and family of the deceased. The greatest agony for a parent is to lose their child during their lifetime. Children are valued for their love, affection, companionship and their role in the family unit.
Consortium is a special prism reflecting changing norms about the status and worth of actual relationships. Modern jurisdictions world-over have recognized that the value of a child's consortium far exceeds the economic value of the compensation awarded in the case of the death of a child. Most jurisdictions therefore permit parents to be awarded compensation under loss of consortium on the death of a child. The amount awarded to the parents is a compensation for loss of the love, affection, care and companionship of the deceased child.
The Motor Vehicles Act is a beneficial legislation aimed at providing relief to the victims or their families, in cases of genuine claims. In case where a parent has lost their minor child, or unmarried son or daughter, the parents are entitled to be awarded loss of consortium under the head of Filial Consortium.
Parental Consortium is awarded to the children who loss their parents in motor vehicle accidents and under the Act.
A few High Courts have awarded compensation on this count. However, there was no clarity with respect to the principles on which compensation could be awarded on loss of Filial Consortium.
The amount of compensation to be awarded as Consortium will be governed by the principles of awarding compensation under 'Loss of Consortium as laid down in Pranay Sethi(supra)."
::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 816. There is no dispute that decision of smaller Bench cannot override pronouncement of Larger Bench. However, where subsequent decision, explains but not contradicts verdict of earlier larger Bench, subsequent clarification/explanation can be taken into consideration. The Apex Court in M .
Natarajan Vs. State by Inspector of Police SPE, CBI, ACB Chennai (2008) 8 SCC 413, reiterated that where the Court, in subsequent pronouncements, after taking into consideration the previous judgment, redefines or explains the width of the principles laid down in previous judgments, subsequent pronouncements is to be followed (Para 38). In Magma General Insurance Co. Ltd. (supra), after taking note of Pranay Sethi's case and reiterating that amount of compensation, to be awarded as consortium, will be governed by the principles of awarding compensation under "loss of consortium", as laid down in Pranay Sethi's case, the Apex Court has awarded Rs.40,000/- to each of the claimant under the head of loss of filial consortium. So far as order in Choalmandalam's case is concerned, there are no details in the order with respect to compensation awarded to the claimants by the MACT or the High Court. The observations of the Apex Court are with reference to the challenge to the order of the High Court, enhancing compensation, as awarded by the Tribunal, which was on the ground that it was far in excess of that to be paid, in accordance with Pranay Sethi's case and in this order applicability of Pranay Sethi's case has been reiterated, but judgment in Magma General Insurance Co. Ltd. case whereby compensation under the head of 'Loss of Consortium' has been explained and defined, in terms of spousal consortium, parental consortium and filial consortium, as discussed supra has not been considered. Therefore, I am of the opinion that the order in Cholamandalam case is not an impediment to grant consortium, as explained and awarded in Magma General Insurance Co. Ltd. case.
::: Downloaded on - 29/09/2019 04:17:32 :::HCHP 917. The MACT has awarded Rs.10,000/- for loss of estate and Rs.15,000/- on account of funeral expenses, whereas nothing has been awarded for loss of consortium. Conjunctive consideration of guidelines laid down in the Pranay Sethi's case and manner in which these were applied in Magma General .
Insurance Co. Ltd., I find that appellant No.1 is entitled for Rs.40,000/- for loss of spousal consortium, appellants No.2 and 3 are entitled for Rs.40,000/- in total i.e. Rs.20,000/- each under the head of loss of Parental consortium and appellant No.4 is entitled for Rs.40,000/- for loss of Filial consortium. Amount awarded on account of loss of estate is also to be enhanced from 10,000/- to Rs.15,000/- and accordingly in addition to total loss of dependency, appellants are entitled for Rs.15,000/- each for loss of estate and funeral expenses, in addition to loss of spouse, parental and filial consortium as discussed supra.
18. In view of above discussion appellants are entitled for following compensation:-
Head Compensation awarded (Rs.)
Annual Income Rs.31201x12 3,74,412.00
Income tax @10%on taxable income (-)17,530.00
Rs.374412-199116 (180000+19116)=175296
Remaining annual income after deduction of 3,56,882.00
Income Tax
Future Prospects @30% on remaining annual (+)1,70,065/-.00
income.
Loss of annual income with future prospects 4,63,947.00
One fourth (1/4th) personal expenditure (-)1,15,987.00
Annual loss of contribution to the dependents 3,47,960.00
after deduction of one fourth (1/4th ) personal
expenditure
Multiplier for aged 47 years 13
Total loss contribution to the dependents 3,47,960x13 = 45,23,480.00
Loss of Estate (+)15,000.00
Funeral Expenses (+)15,000.00
Loss of Consortium
(i) Spousal consortium (+) 40,000/ to appellant No.1.
(ii) Parental consortium (+) 40,000/-each to appellants No.2 & 3
(iii) Filial consortium (+) 40,000/- to respondent No.4.
Total 46,73,480.00
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10
The appellants are also entitled for interest on the aforesaid amount of Rs.46,73,480/-@ 9% per annum from the date of filing the petition till the deposit of the same as awarded by the MACT.
.
19. In addition to amount of compensation awarded for loss of consortium, each appellant, in the amount of Rs.45,53,480/-, shall be entitled for share in terms of the award of the MACT, which is as under:-
I. Appellant No.1 Mandeep Kaur 50%
II. Appellant No.2 Jasleen Kaur 20%
III. Appellant No.3 Avleen Kaur 20%
IV. Appellant No.4 Mahinder Kaur 10%
20.
Respondent Insurance Company is directed to deposit the enhanced compensation along with upto date interest in the Registry of this Court within eight weeks from today.
Appeal stands allowed in above terms. Pending application(s), if any, also stand disposed of. Record be sent back. No order as to costs.
(Vivek Singh Thakur), Judge.
September 12, 2019 (ravinder) ::: Downloaded on - 29/09/2019 04:17:32 :::HCHP