Parvesh v. National Insurance Company

1. These cross-appeals have been filed challenging the Award dated 04.02.2017 passed by the learned Motor Accidents Claims Tribunal (West-01), Delhi (hereinafter referred to as the ‘Tribunal’) in New MACT Case No. 477450/16 titled Parvesh & Ors. v. Sh. Bheem Singh & Ors..

2. The challenge of the Insurance Company (appellant in MAC.APP. 293/2017) and the claimants (appellant in MAC.APP. 134/2018) is to the quantum of the compensation awarded in favour of the claimants. While the Insurance Company is aggrieved of the compensation awarded by the learned Tribunal in favour of the Claimants by taking the minimum wages for a ‘skilled person’ as notified by the Government of NCT of Delhi, the claimants are aggrieved of the learned Tribunal not awarding the compensation on the basis of the evidence of monthly income produced before the learned Tribunal. The claimants also challenge the Impugned Award inasmuch as it does not take into account Future Prospects.

3. The learned counsel for the Insurance Company submits that as the deceased was a resident of State of Uttar Pradesh, the minimum wages as notified by the Government of Uttar Pradesh should have been taken into account for determining the compensation.

4. On the other hand, the learned counsel for the claimants submits that the learned Tribunal has failed to appreciate that the deceased was paying a monthly instalment of Rs.33,650/- to M/s. Tata Motors Finance Limited, for a period of almost two years prior to his death, for a loan taken to buy the truck, which was involved in the accident in question.

5. The learned counsel for the Insurance Company refutes the above submission of the claimants by stating that no cogent proof of income was produced by the claimants in form of any income tax returns filed by the claimants or his bank statement. The only proof of the above assertion was in form of the statement of PW-2- Mr.Johnson Andrews.

6. I have considered the submissions made by the learned counsels for the parties.

7. PW-2, Mr.Johnson Andrews, working as Assistant Manager (Legal), Tata Motor Finance Limited, was summoned by the claimants before the learned Tribunal. He stated that the deceased had taken a loan for his vehicle, that is, the truck bearing no. UP-13T-9355, on 31.10.2014. The loan amount of Rs.10,80,000/- which was to be repaid in 47 equal monthly instalments, with the first being of Rs.34,327/- and the remaining of Rs.33,650/- per month. The deceased had paid 20 EMIs from 02.12.2014 to 02.08.2016 ‘in cash’ against the loan.

8. Though PW-2 could not state the source of the income of the borrower or the person who was making the repayment of the loan, in my view, the learned Tribunal should have relied upon the statement of PW-2 to assess the income of the deceased. The deceased was paying monthly instalment of Rs.33,650/-. His income would certainly have been more than that as he would have also spent on his own self and his family’s day-to-day expenses. Merely because the claimants were unable to produce the income tax records or other cogent material in support of their assertion of the income of the deceased, their claim should not have been reduced on this account. In Chandra alias Chanda alias Chandraram & Anr. v. Mukesh Kumar Yadav & Ors., (2022) 1 SCC 198, the Supreme Court has held that in absence of documentary evidence on record for the income of the deceased, some amount of guesswork is required to be done. Though the minimum wages notification can be a yardstick but, at the same time, it cannot be an absolute one to fix the income of the deceased. Merely because the claimants were unable to produce documentary evidence to show the monthly income of the deceased, same does not justify adoption of lowest tier of minimum wages while computing the income. I may quote from the judgment as under:-

9. In the present case, the learned Tribunal had before it the evidence in form of PW-2, who stated that the deceased had taken a loan on his vehicle and was paying instalment of Rs.33,650/- per month. In my view, therefore, the income of the deceased should have been assessed at Rs.33,650/- per month for determining the compensation payable to the appellants. As far as Future Prospects is concerned, in National Insurance Company Limited v. Pranay Sethi and Others, (2017) 16 SCC 680, the Supreme Court has directed as under:- “59.3. While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax.

59.4. In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component.”

10. In the present case, the deceased was self-employed and was aged about 27 years on the date of the accident. In terms of the judgement of Pranay Sethi (Supra), therefore, the future prospects at the rate of 40% should have been added. It is ordered accordingly.

11. In view of the above, the compensation on account of Loss of Dependency is re-assessed and is accordingly enhanced as under:- Loss of dependency:- (33,650 x140/100) x 3/4 x 12 x 17= Rs.72,07,830/- Loss of dependency awarded by the Tribunal = Rs.16,82,694/- Enhanced Amount = Rs.55,25,136/-