New India Assurance Company Ltd v. Mandavi Mehta through LRs & Ors.

1. This appeal has been filed by the insurance company assailing the award dated 08th August 2014 in MACT No.659/2011 passed by the Motor Accident Claims Tribunal, Saket Courts (‘MACT/Tribunal’) awarding compensation of Rs.1,53,04,188/- in respect of a fatal accident, which occurred on 22nd April 2011 when deceased, Nikhil Mehta, aged 39 years, lost his life while travelling with his family in a Maruti car driven by Vishal Mehta.

2. Mr. C. K. Gola, counsel for the insurance company, has raised various issues, both on negligence and compensation, which are dealt with as under. Issue of negligence

3. On the issue of negligence, submission of the insurance company is that there was composite/contributory negligence, which has to be deducted in terms of liability. However, it is clear from the record that Mr. Nikhil Mehta was merely an occupant in the car, and even if he was sitting as a co-driver, no contributory negligence can be ascribed to him.

4. Even otherwise, if the plea is one of composite negligence of Vishal Mehta and the driver of the offending vehicle, which was a truck allegedly parked in the middle of the road leading to a rear-end collision, such a plea was never raised by the insurance company before the MACT. Hence, neither was any issue framed on this aspect, nor was Vishal Mehta served with notice, nor was any evidence led or considered in this regard.

5. Accordingly, the plea is rejected, as in these circumstances the insurance company cannot be permitted to raise the plea of contributory/composite negligence for the first time before this Court. Assessment of income

6. An objection has been raised regarding the assessment of the deceased's income by the MACT on the basis of Form 16. A perusal of Form 16, which pertains to the financial year from 1st April 2010 to 31st March 2011, shows that although it was filed subsequent to the death of the deceased on 22nd April 2011, the MACT rightly relied upon it for assessment of benchmark income.

7. Accordingly, the MACT has rightly relied upon Form 16 and taken the gross income, after deducting the tax payable, as the annual income. This Court finds no infirmity whatsoever in the said approach. Deduction towards personal expenses

8. Mr. C. K. Gola has challenged the deduction towards personal expenses being taken as 1/4 by the MACT, contending that it ought to have been 1/3, since by the time the award was passed, the spouse of the deceased, Nikhil Mehta, had also passed away.

9. However, Mr. Kamra, counsel for the claimants, rightly points out that the assessment has to be taken on the date of the accident. On the date of accident, the deceased was survived by his spouse, two minor children, and his mother, who constituted four dependants.

10. Accordingly, the deduction towards personal expenses was rightly taken as one-fourth. The father of the deceased was not treated as a dependant. Accordingly, this plea is also not acceptable. Future Prospects

11. Mr. C. K. Gola has challenged the grant of future prospects at the rate of 50%, contending that it ought to have been 40%, considering that the deceased was in a private job. The decision in Sarla Verma followed up by Pranay Sethi on the issue of future prospects, makes it clear that the distinction is not merely between permanent employment and selfemployment/fixed salary. Rather, there must be evidence of regular increments and a consistent increase in income in a job which would put any claimant in the category of a ‘permanent job’ or the purposes of grant of future prospects.

12. This Court finds that the MACT has comprehensively dealt with this issue in paragraph 28 of the award after considering the evidence relating to the deceased's income, as discussed in paragraph 22. The MACT has noted that the deceased's salary had consistently increased from Rs.8,000/- to Rs.80,000/- over a period of 8 years, and therefore, future prospects have been rightly taken at 50%. Other alignments

13. As regards the other components of compensation, the same are liable to be realigned in view of the principles laid down in National Insurance Co. Ltd. v. Pranay Sethi and Ors. (2017) 16 SCC 680 as under: a. Compensation towards loss of love and affection shall not be awarded in view of the decision in United India Insurance Co. Ltd. v. Satinder Kaur @ Satwinder Kaur and Ors. (2021) 11 SCC 780; b. Funeral expenses shall be reduced to Rs.15,000/-, instead of Rs.25,000/-; c. Compensation towards loss of estate shall be enhanced to Rs.15,000/-, instead of Rs.10,000/-; and d. Loss of consortium shall be awarded at Rs. 2,00,000/-, i.e. Rs. 40,000/- each to the five claimants, namely, parents of the deceased, spouse and two minor children.

14. Accordingly, the compensation will be revised as under: Sr. No. Heads Awarded by the Tribunal Awarded by the Court

1. Annual income of the deceased (A) Rs. 8,87,063/- Rs. 8,87,063/-