M/S KARNATAKA POWER TRANSMISSION CORPORATION LTD vs. THE INCOME TAX OFFICER

1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 1ST DAY OF JULY 2021 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR. JUSTICE HEMANT CHANDANGOUDAR M.F.A. NO.125 OF 2019 (MV-D) BETWEEN: 1 . LAKSHMI PRABHU AGED ABOUT 37 YEARS W/O LATE K. MADHAVA PRABHU. 2 . KUMARI AASTHA PRABHU AGED ABOUT 10 YEARS D/O LATE K. MADHAVA PRABHU, MINOR REP. BY HER MOTHER AND NATURAL GUARDIAN LAKSHMI PRABHU. BOTH ARE RESIDING AT 5-562 'DEVAGIRI MANE', KATTIMARU KABETTU, SALMAR POST KARKALA KASBA VILLAGE KARKALA TALUK. ... APPELLANTS (BY SRI. PAVANA CHANDRA SHETTY H, ADV.,) AND: 1 . KRISHNA RAJ SARALAYA AGED ABOUT 35 YEARS S/O HARI NARAYANA SARALAYA R/AT ARADHANA APARTMENT NEAR GAYATHRI GUEST HOUSE

2 DHARMASTHALA D K DISTRICT. 2 . THE DIVISIONAL MANAGER THE UNITED INDIA INSURANCE CO. LTD., MANIPAL DIVISIONAL OFFICE MANIPAL-576 119. ... RESPONDENTS (BY SRI. ANUP SEETHARAMA RAO, ADV., FOR R2 V/O DTD:6.3.2021 NOTICE TO R1 D/W) - - - THIS M.F.A. IS FILED UNDER SEC.173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD DATED 9.2.2018 PASSED IN MVC NO.216/2017, ON THE FILE OF THE SENIOR CIVIL JUDGE AND AMACT, KARKALA, PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION. THIS M.F.A. COMING ON FOR ADMISSION, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING: JUDGMENT This appeal under Section 173(1) of the Motor Vehicles Act, 1988 (hereinafter referred to as ‘the Act’, for short) has been filed by the claimants seeking enhancement of the amount of compensation against the judgment dated 09.02.2018 passed by the Motor Accident Claims Tribunal in MVC No. 216/2017.

3 2. Facts giving rise to the filing of the appeal briefly stated are that on 26.10.2016, the deceased Madhava Prabhu was driving his TATA Nano Car bearing Reg. No. KA-19-MA-9245 from Bajagoli. When he reached near Dharmasthala near Gandhinagar of Nallur Village, an oncoming car bearing Registration No. KA- 19-MA-4435 (hereinafter referred to as 'the offending vehicle' for short), which was being driven by its driver in a rash and negligent manner, came from the opposite direction and dashed against the Nano car of the deceased. As a result of the aforesaid accident, the deceased sustained grievous injuries and succumbed to the same. 3. The claimants thereupon filed a petition under Section 166 of the Act claiming compensation on the ground that the deceased was aged about 44 years at the time of accident and was engaged in a self owned business concern and was earning a sum of

4 Rs.3,50,000/- per month. It was further pleaded that accident took place solely on account of rash and negligent driving of the lorry by its driver. The claimants claimed compensation to the tune of Rs.3,40,24,533/- along with interest. 4. The insurance company filed written statement, denying the averments of the petition. It was also pleaded that the deceased as well as driver of the offending vehicle did not hold a valid and effective driving license at the time of accident and that the liability of the insurance company, if any, would be subject to the terms and conditions of the insurance policy. The age, avocation and income of the deceased was also denied and it was pleaded that the claim of the claimants is exorbitant and excessive. Thus, it was prayed that the petition be dismissed. 5. On the basis of the pleadings of the parties, the Claims Tribunal framed the issues and thereafter

5 recorded the evidence. The claimant No.1 examined herself as PW-1 and got exhibited documents namely Ex.P1 to Ex.P64. The respondents did not adduced any oral evidence, however, copy of the insurance policy was marked on their behalf as Ex. R1. The Claims Tribunal, by the impugned judgment, inter alia, held that the accident took place on account of rash and negligent driving of the offending vehicle by its driver. It was further held, that as a result of aforesaid accident, the deceased sustained injuries and succumbed to the same. The Tribunal further held that the claimants are entitled to a compensation of Rs.27,30,800/- along with interest at the rate of 8% per annum. Being aggrieved, this appeal has been filed by the claimants seeking enhancement of the amount of compensation. 6. Learned counsel for the claimant submitted that the Tribunal has grossly erred in assessing the income of the deceased as Rs.18,000/- per month without considering Ex. P56, Income Tax Return form. It

6 is urged that the business carried on by the deceased has been foreclosed by the Bank on account of default in payment of loans. It is further submitted that the Tribunal has erred in not making an addition to the tune of 50% to the income of the deceased on account of future prospects in view of the law laid down by the Supreme Court in ‘NATIONAL INSURANCE COMPANY LIMITED Vs. PRANAY SETHI AND OTHERS’ AIR 2017 SC 5157. It is further submitted that the sums awarded under the heads ‘loss of consortium’ and ‘funeral expenses’ are on the lower side and deserves to be enhanced suitably. On the other hand, learned counsel for the insurance company submitted that tribunal after considering the evidence on record, has rightly taken the income of the deceased notionally at Rs.18,000/- per month. It is urged that the claimants continuing the business which was carried on the deceased. It is further submitted that the amount of

7 compensation awarded by the Tribunal is just and proper and does not call for any interference. 7. We have considered the submissions made by learned counsel for the parties and have perused the record. The only question which arises for our consideration in this appeal is with regard to the quantum of compensation. It is not in dispute that deceased was involved in the cashew business and was an income tax assessee. Ex. P53, is the income tax return form filed for the assessment year 2012-13 which has been filed on 13.07.2013. The aforesaid document indicates that the income of the deceased was Rs. 1,57,179/- per annum. Ex. P54, is the income tax return form filed for the assessment year 2013-14 which has been filed on 13.07.2013. The aforesaid document indicates that the income of the deceased was Rs. 4,14,676 per annum after deducting Rs. 14,298 towards income tax. The tribunal has assessed the income of the claimant at Rs. 18,000 per month without assigning any

8 reasons for discarding the aforesaid document. The aforesaid finding of the tribunal cannot be sustained in law. Therefore the income of the deceased is assessed at Rs.2,85,928 /- per annum by taking average income on the basis of Ex. P53 and P54 as the deceased being a business man whose income may fluctuate from year to year. 8. In view of the law laid down by the Constitution Bench of the Supreme Court in ‘NATIONAL INSURANCE COMPANY LIMITED Vs. PRANAY SETHI AND OTHERS’ AIR 2017 SC 5157, 25% of the amount has to be added on account of future prospects. Thus, the annual income comes to Rs.3,57,410/-. Since, the number of dependents is 2, therefore, 1/3rd of the amount has to be deducted towards personal expenses and therefore, the annual dependency comes to Rs.2,38,274/-. Taking into account the age of the deceased which was 44 years at the time of accident, the multiplier of ‘14’ has to be adopted. Therefore, the

9 claimants are held entitled to (Rs.2,38,274 x14) i.e., Rs.33,35,836/- on account of loss of dependency. 9. In view of laid down by the Supreme Court in ‘MAGMA GENERAL INSURANCE CO. LTD. VS. NANU RAM & ORS.’ (2018) 18 SCC 130, which has been subsequently clarified by the Supreme Court in ‘UNITED INDIA INSURANCE CO. LTD. Vs. SATINDER KAUR AND ORS.’ IN CIVIL APPEAL NO.2705/2020 DECIDED ON 30.06.2020 each of the claimant’s are entitled to a sum of Rs.40,000/- on account of loss of consortium and loss love and affection. Thus, the claimants are held entitled to Rs.80,000/-. In addition, claimants are held entitled to Rs.30,000/- on account of loss of estate and funeral expenses. The amount of compensation awarded under the head 'conveyance' is maintained. Thus, in all, the claimants are held entitled to a total compensation of Rs.34,55,836/-. Needless to state that the enhanced amount of compensation i.e. Rs.7,25,036/- shall carry interest at the rate of 6% per

10 annum from the date of filing of the petition till the payment is made. To the aforesaid extent, the judgment passed by the Claims Tribunal in MVC no. 216/2017 is modified. Accordingly, the appeal is partly allowed. Sd/- JUDGE Sd/- JUDGE ss