M/S.KINFRA EXPORT PROMOTION INDUSTRIAL PARKS LTD., vs. THE ASSISTANT COMMISSIONER OF INCOME TAX,

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT THE HONOURABLE MR.JUSTICE BASANT BALAJI FRIDAY, THE 16TH DAY OF SEPTEMBER 2022 / 25TH BHADRA, 1944 MACA NO. 62 OF 2018 OPMV 816/2012 OF ADDITIONAL DISTRICT COURT-II & IST ADDITIONAL MOTOR ACCIDENT CLAIMS TRIBUNAL, MAVELIKKARA APPELLANT/S: 1 VASANTHA KUMARI,VASANTHALAYAM, EVOOR SOUTH, KEERIKKAD P.O. 2 GOPALAKRISHNAN NAIR,VASANTHALAYAM, EVOOR SOUTH, KEERIKKAD P.O. 3 BINDHU,VASANTHALAYAM, EVOOR SOUTH, KEERIKKAD P.O. BY ADVS.SRI.GEORGE VARGHESE(PERUMPALLIKUTTIYIL) SRI.P.J.JOE PAUL RESPONDENT/S: 1 MURUKESH S. KUMAR MURUKALAYAM, MULAVANA P.O, KOLLAM - 691 503. 2 SASIKUMAR,MURUKALAYAM, PERAYAM, MULAVANA P.O, KOLLAM - 691 503. 3 THE ORIENTAL INSURANCE C. LTD,REP. BY ITS BRANCH MANAGER, BRANCH OFFICE, KAYAMKULAM - 690 502. 4 VINOD,NKP NIVAS, NEAR SOCIETY, NADUVILA KARA CHERI, KALLADA WEST - 691 500. BY ADVS.SRI.P.NARAYANAN SRI.VPK.PANICKER SRI.C.RAJENDRAN SRI.B.N.HASKAR SMT.P.SHEEBA/SMT. K S SANTHI THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING COME UP FOR ADMISSION ON 17.8.2022, THE COURT ON 16.9.2022 DELIVERED THE FOLLOWING:

MACA NO. 62 OF 2018 -2- JUDGMENT (Dated this the 16th day of September 2022) The petitioners, the legal heirs of one Biju G.Nair, who died in a motor vehicle accident on 22.5.2011, have filed O.P. (M.V.) No.816 of 2012 claiming compensation before the Motor Accidents Claims T, Mavelikara. The Tribunal awarded total compensation of Rs.27,16,180/- with interest at the rate of 7.5% per annum from the date of the petition. Aggrieved by the quantum of compensation awarded, this appeal is filed. 2. On 22.05.2011 at 6.00 p.m., the deceased Biju G.Nair was riding a motorcycle bearing Reg.No.KL-29/B-4134 along the Kollam – Chenkotta public road in east-west direction and when he reached the weigh bridge, a car bearing Reg.No.KL- 23/504, which came from the opposite direction hit against the scooter and thereby the deceased fell down and another car bearing Reg.No.KL-02/R-4005, came from the same direction of the scooter ran over the deceased and thereby he sustained fatal injuries. Though he was taken to Sankars Hospital, Kollam, while undergoing treatment, he succumbed to the injuries. 3. The counsel for the petitioners alleged that the accident occurred due to the rash and negligent driving of the offending vehicle bearing KL-23/504, which came from the

MACA NO. 62 OF 2018 -3- opposite direction. The 1st respondent is the driver of the car and 2nd and 3rd respondents are the insurer. The owner cum driver of the car bearing Reg.No.KL-02/R-4005 was also made a party. Respondents 1, 2 and 4 remained ex-parte. 4. The 3rd respondent alone filed a written statement contending that the petition is not maintainable either in law or in facts. The vehicle involved in the accident was having a valid insurance policy at the time of the accident. The allegation that the accident happened due to negligence on the part of the 1st respondent is denied. The accident happened due to the negligent driving of the 4th respondent and the deceased/rider of the scooter. The amount of compensation claimed on various heads is excessive and prayed for dismissal of the O.P. 5. The Tribunal on a consideration of the facts and circumstances of the case, as well as Exts.A1 to A12, awarded the compensation to the petitioners. 6. Heard the counsel on both sides. 7. The main contention raised by the counsel for the appellants is regarding the deduction of income tax at the rate of 20% on the total compensation in respect of the loss of dependency. He submits that the Tribunal went wrong in deducting the income tax, which is against the dictum laid down

MACA NO. 62 OF 2018 -4- by the Apex Court. Moreover, the compensation awarded on various heads are also on the lower side. 8. The counsel for the respondents submits that the Tribunal was right in deducting 20% of the income tax on the final figure of Rs.31,37,724/- and that reasonable compensation has been awarded on all the other heads. 9. The main issue raised is regarding the deduction of income tax in this case. The counsel for the appellants submits that the income means, the actual income less income tax paid. Therefore, after computing the annual salary, the income tax has to be deducted from that and the net salary has to be arrived at and thereafter, future prospects if any has to be added and deductions has to be made on that figure. It is seen from Ext.A12 salary certificate issued by the office of the Commandant, CRPF, Chandigarh that he was drawing a salary of Rs.20,508/-. It is seen that after the deduction of Rs.1,938/-, the Tribunal has taken Rs.20,508/- as the monthly salary, excluding the deductions. For calculating loss of dependency, the entire salary including deductions has been taken into account, the monthly salary ought to have been taken as Rs.22,446/- per month, hence the annual salary of the deceased would be Rs.22,446x12 = 2,69,352/-. Since the accident happened on 22.5.2011, for calculating the income tax, the

MACA NO. 62 OF 2018 -5- assessment year to be taken as 2012-13 and in that case, the first slab of income tax rules for nil tax is till Rs.1,80,000/-, that being so, the income to be taken for the taxable income would be Rs.2,69,352-Rs.1,80,000= Rs.89,352/-. Income tax is chargeable at the rate of 10% of Rs.89,352, which comes to Rs.8,935/-. So the annual income less income tax would be 2,69,352-8935 = 2,60,417/-. Since the deceased was aged 25 years 11 months and 28 days, the multiplier to be adopted is 18, since he has not completed 26 years. Going by the decision reported in National Insurance Company Ltd. v. Pranay Sethi [(2017) 16 SCC 680] future prospectus at the rate of 50% is to be added since he is below the age of 40 years and has a permanent job. The deceased was unmarried, so half of the income has to be deducted towards personal expenses. So, the annual income of the deceased would be Rs.2,60,417+1,30,208.5 (2,60,417x50/100) = Rs.3,90,625.5. Deducting half of this amount towards personal and living expenses and taking 18 as the multiplier, the loss of dependency can be calculated as follows:

MACA NO. 62 OF 2018 -6- Annual income 12 x Rs.22,446 Rs.2,69,352.00 Income Tax (Applying Income Tax slab for the assessment year 2012-13) For Rs.1,80,000/- & above 10% of amount exceeding Rs.1,80,000 Rs.2,69,352-1,80,000 = 89,352 10% of 89,352 = Rs.8,935/- Actual salary (After deduction of Income tax applying Income tax slab) 2,69,352-8,935 (Annual income-Income Tax) Rs.2,60,417/- Calculation of loss of dependency Future prospects for age group below 40 years Rs.1,30,208.5 (Rs.2,60,417x50%) Revised Annual Income For calculation of loss of dependency Rs.3,90,625.5 (Rs.2,60,417+1,30,208.5) Deduction towards personal expenses (50% deduction) half Multiplier applicable 18 3,90,625.5x18x1/2 (Revised income x multiplier x half towards personal expenses) Rs.35,15,629.5 (Rounded off to Rs.35,15,630/-) 10. As far as the funeral expense is concerned, the Tribunal has awarded a sum of Rs.25,000/-, the maximum which can be awarded on the said head is Rs.15,000+10%

MACA NO. 62 OF 2018 -7- increase every three years, which comes to Rs.16,500/-. So the funeral expenses are brought down from Rs.25,000/- to 16,500/-. 11. Towards pain and suffering, an amount of Rs.25,000/- is awarded. The Apex Court in a number of decisions including the Oriental Insurance Company Limited v. Kahlon [2021 SCC OnLine SC 691], in which the injured being bedridden for more than 16 years and died, the Apex Court held that no amount can be awarded for pain and suffering, hence the amount of Rs.25,000/- awarded as pain and suffering, since the injured died in the accident, the same has to be set aside and I do so. 12. Towards love and affection, against the claim of Rs.3,00,000/- only Rs.1,00,000/- was awarded by the Tribunal. The appellant Nos.1 and 2 are the mother and father of the deceased and 3rd appellant is the sister of the deceased. Going by the decision reported in Pranay Sethi (Supra) appellant Nos.1 and 2 are entitled to a sum of Rs.44,000/- each, which comes to Rs.88,000/-. The 3rd appellant being the sister of the deceased, is not entitled to loss of consortium. 13. Towards loss of estate, a sum of Rs.50,000/- is awarded by the Tribunal. According to the decision of the

MACA NO. 62 OF 2018 -8- Apex Court in Pranay Sethi (Supra), the maximum amount that can be awarded under loss of estate could be only Rs.15000+10% increase i.e. Rs.16,500/-. Hence the amount of Rs.50,000 awarded as loss of estate is brought down to Rs.16,500/-. Accordingly, the following enhancements/deductions are made to the award passed by the Tribunal: Head of Claim Amt. Awarded by Tribunal (Rs.) Amt. Awarded in appeal (Rs.) Compensation for permanent disability 25,10,180 35,15,630 Loss of Consortium 0 88,000 Pain and suffering 25,000 0 Loss of Love & Affection 1,00,000 0 Funeral Expenses 25,000 16,500 Loss of estate 50,000 16,500 Total 27,10,180 36,36,630 Amount enhanced is 36,36,630 - 27,10,180 = Rs.9,26,450/- In the result, the appeal is allowed. The appellants and entitled to the enhanced compensation of Rs. 9,26,450/- (Nine

MACA NO. 62 OF 2018 -9- lakh twenty six thousand four hundred and fifty Rupees only). The Insurance Company shall pay interest for the amounts awarded by the Tribunal at the rate directed in the impugned award and for the enhanced amounts at the rate of 7.5% from the date of petition till realisation. If any amounts have already been paid, the same shall be granted set off. The claimants shall produce the details of the Bank account before the Insurance Company/Tribunal within one month from the date of receipt of a certified copy of this judgment and amount shall be transferred to the Bank account directly through NEFT/RTGS mode, within a period of one month thereafter. If the Bank account is not furnished within the time stipulated, it is made clear that no interest shall run on the enhanced amount after the period stipulated by this Court. However, if the Insurance Company fails to deposit the amount as directed, interest shall run at the rate ordered by the Tribunal from the date of the petition.

SD BASANT BALAJI, JUDGE dl/