THE PRINCIPAL COMMISSIONER OF INCOME TAX vs. SHRI. BASAVESHWAR URBAN COOPERATIVE CREDIT SOCIETY

: 1 : IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH

DATED THIS THE 26T H DAY OF AUGUST, 2020

PRESENT

THE HON’BLE MR.JUSTICE P.S.DINESH KUMAR

AND

THE HON’BLE MR.JUSTICE S.VISHWAJITH SHETTY

MFA NO.100938/2015 (MV) C/W. MFA CROB NO.100007/2016 (MV)

IN MFA NO.100938/2015

BETWEEN:

THE NEW INDIA ASSURANCE COMPANY LIMITED, BRANCH OFFICE HOSPITAL BUILDING, 1 ST FLOOR, PALA BADAMI ROAD, GADAG, REPRESENTED BY ITS DEPUTY MANAGER, REGIONAL OFFICE, TP-HUB, II FLOOR, SRINATH COMPLEX, NEW COTTON MARKET, HUBBALLI-580 029.

... APPELLANT.

(BY SRI G N RAICHUR, ADVOCATE.)

AND:

: 2 :

... RESPONDENTS

(BY SMT. V VIDYA, ADVOCATE, FOR R.1 TO R.3; SRI PRAKASH S. UDIKERI, ADVOCATE, FOR R.4; SRI SURESH P. HUDEDAGADDI, ADVOCATE, FOR R.5.)

THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER SECTION 173(1) OF M.V.ACT, 1988, PRAYING TO SET ASIDE THE JUDGMENT AND AWARD DATED 22.12.2014, PASSED IN MVC NO.53/2012, ON THE FILE OF THE MEMBER, ADDL. MACT, SIRSI, BY ALLOWING THIS APPEAL, ETC.,.

IN MFA CROB NO.100007/2016

BETWEEN:

: 3 : 2. ABHISHEK GIRISH BENAKANAHALLI AGE: 24 YEARS OCC: STUDENT AT B.V.B. COLLEGE OF ENGINEERING PRESENTLY RESIDING AT COLLEGE HOSTEL HUBBALLI, DIST: DHARWAD

... CROSS OBJECTORS.

(BY SMT. V.VIDYA, ADVOCATE.)

AND:

... RESPONDENTS

(BY SRI SURESH P HUDEDAGADDI, ADVOCATE, FOR R.1; SRI G.N.RAICHUR, ADVOCATE, FOR R.2.)

THIS CROSS OBJECTION IN MFA IS FILED UNDER ORDER 41 RULE 22 OF CPC, PRAYING TO AWARD HIGHER COMPENSATION BY MODIFYING THE JUDGMENT AND AWARD DATED 22.12.2014, PASSED IN MVC NO.53/2012, ON THE FILE OF THE MEMBER, ADDL. MACT, SIRSI, BY ALLOWING THIS CROSS OBJECTION, ETC.,.

: 4 :

RESERVED FOR JUDGMENT ON : 17.8.2020. JUDGMENT PRONOUNCED ON : 26.8.2020. THIS APPEAL AND CROB HAVING BEEN HEARD AND RESERVED FOR JUDGMENT, COMING ON FOR PRONOUNCEMENT OF JUDGMENT THIS DAY, P.S.DINESH KUMAR, J, DELIVERED THE FOLLOWING:

JUDGMENT

These two cases arise out of the judgment and award dated 22.12.2014 in MVC No.53/2012, on the file of Addl. MACT, Sirsi. Insurer has challenged the award on the ground that the victim was negligent in riding his motorcycle. Claimants have filed MFA CROB No.100007/2016 seeking enhancement in compensation. 2. Briefly stated the facts of the case are, at about 10.40 p.m. on 19.1.2012, one Girish Basavanneppa Benakanahalli was travelling from Dharwad to Hubballi on his motorcycle bearing registration No.KA-25/EJ-8894. When he was riding near IOC petrol pump, on P.B.Road, a petrol tanker bearing registration No.KA-26/9284 coming from opposite direction, turned to its right and dashed

: 5 : against the motorcycle. Girish sustained grievous injuries and shifted to SDM Hospital. He was declared dead on arrival in the hospital. 3. Dependents of Girish have presented the instant claim petition seeking compensation contending inter-alia that Girish was working as a Manager in Karnataka State Financial Corporation and getting a salary of Rs.49,672/-. On behalf of the claimants, Girish’s wife Smt.Shanta has been examined as PW.1 and Exs.P.1 to P.9 marked. On behalf of respondents, RW.1 to RW.3 have been examined and Exs.R.1 to R.11 marked. The tribunal has framed following issues for its consideration. (i) Whether the petitioners prove that deceased Girish Basavanneppa Benakanahalli died in a road traffic accident on 19.1.2012 at about 11.40 p.m. IOC petrol bunk, P.B.Road, Dharwad due to rash and negligent driving of Tata Tanker No.KA-26/9284 by its driver?

: 6 : (ii) Whether the petitioners are entitled for compensation? If so at what quantum and from whom? (iii) What order or award?

: 7 : tribunal has committed an error by taking full salary to compute the loss of dependency, whereas the tribunal ought to have applied ‘split multiplier’ formula. In the affidavit filed in support of the application, it is pleaded that the deceased was aged 48 years and was left with 12 years service and after his retirement deceased would not have earned full salary. 7. The claimants have presented their cross objection to the appeal filed by the insurer and sought for enhancement of compensation. 8. We have heard Sri G.N.Raichur, learned advocate for the insurer and Smt.V.Vidya, learned advocate for the claimants. 9. Sri Raichur urged the following two grounds. • that the driver of the oil tanker had put indicator and carefully turned the tanker to its right side. The victim was riding the motorcycle in

: 8 : a rash and negligent manner. The spot sketch shows that the motorcycle has hit the tanker at oil releasing valve box. Therefore the accident has occurred entirely due to the negligence of the victim. Hence the owner of the tanker cannot be held liable to pay compensation. Consequently, insurer will have to be discharged of its liability; • it is the admitted case of the claimants that victim was working as Manager in the Karnataka State Financial Corporation. He had 12 years service. Victim’s income would have reduced drastically after retirement. Therefore ‘split multiplier’ formula ought to have been applied.

: 9 : towards his personal expenses. She urged that there are 4 dependents. Therefore, 1/4th of victim’s salary ought to have been deducted towards personal expenditure. She also urged that claimants are entitled for consortium and compensation on other conventional heads as per the decisions in the case of National Insurance Company Limited vs. Pranay sethi and others, reported in AIR 2017 Supreme Court 5157 and Magma General Insurance Company Limited vs. Nanu Ram Alias Chuhru Ram and others, reported in (2018) 18 Supreme Court Cases 130. 11. We have carefully considered rival contentions and perused the records. 12. The following points arise for our consideration in these two cases. (i) Whether accident has occurred due to the negligence on the part of the rider of the motorcycle?

: 10 : (ii) Whether ‘split multiplier’ formula ought to have been applied to calculate loss of dependency? (iii) Whether claimant is entitled for enhancement of compensation?

: 11 : stopped the lorry and got down, he saw that victim had fallen on the ground. 14. In his cross-examination, the driver has admitted that he first heard the sound and later learnt about the accident when he got down. He has also specifically admitted that before hearing the sound he did not realize there was an accident. He has also stated that he informed the police, but police did not receive any complaint from him. He has further admitted that he has not filed any private complaint in the Court. 15. A careful analysis of the evidence of tanker driver shows that he had no clue about the collision till he heard some sound and got down from the tanker. Therefore ex-hypothesi, the driver had turned the tanker from the left side of the National Highway to the right side to enter the oil depot without noticing the motorcycle coming from opposite side. Hence the contention of the insurer that the accident has occurred due to the negligence

: 12 : on the part of rider of the motorcycle must fail and accordingly we answer this point in the negative. 16. Re: Whether ‘split multiplier’ formula ought to have been applied to calculate loss of dependency? Sri Raichur relied upon following decisions. (i) Paragraph No.14 in MFA No.20727/2010 and connected appeals (The New India Assurance Co. Ltd., and another vs. Sri Prithviraj S/o.Laxman Kadam and others) decided on 8.12.2016. (ii) Paragraphs No.8 and 11 in MFA No.24473/2013 and connected appeal (The Manager, Royal Sundaram Alliance Insurance Co. Ltd., vs. Smt.Nirmala w/o.Sudershan Gadawal and another.) decided on 13.9.2017. (iii) Paragraph No.13 in MFA No.12247/2007 (The New India Assurance Co. Ltd., vs. Smt.Malana Bai and others) decided on 24.10.2011.

: 13 : (iv) Paragraph No.3 in MFA No.6624/2017 (The Divisional Manager, M/s.United India Insurance Company Limited vs. Smt.Kokila Vani K.J. and others) decided on 27.2.2020. (v) ILR 2000 Kar. 3809 (Union of India and others vs. K.S.Lakshmi Kumar and others).

: 14 : reported in AIR 2014 SC 706. The Supreme Court of India, in Puttamma’s case has held that in the absence of any specific reason and evidence on record the tribunal or Court should not apply split multiplier in routine course and should apply multiplier as per decision of the Hon’ble Supreme Court in the case of Sarla Verma (smt) and others vs. Delhi Transport Corporation and another, reported in (2009) 6 Supreme Court Cases 121. It is also held in Puttamma’s case that the Motor Vehicles Act does not envisage application of split multiplier. 19. In this case, the insurer has not pleaded anything with regard to split multiplier before the tribunal. Even in this Court while presenting the appeal in the year 2015, the ground with regard to split multiplier was not taken. It is only on 11.9.2017, that the insurer has filed an interlocutory application seeking to amend the memorandum of appeal. Though no specific orders

: 15 : have been passed on the said interlocutory application, we have considered the same on merits. 20. In the decisions of Division Benches noted hereinabove (MFA No.7025/2015 and MFA No.24613/2013), following Puttamma’s case, it has been held that in the absence of any reasons and evidence on record, MACT should not apply split multiplier formula. We are in respectful agreement of this view. Accordingly, we answer this point also in the negative. 21. Re: Whether claimant is entitled for enhancement of compensation? Admittedly the victim was working as Manager in Karnataka State Financial Corporation and earning Rs.49,672/- per month. The claimants have produced his salary certificate and it has been marked as Ex.P.6. The gross salary mentioned in the salary certificate is Rs.49,672/-. A sum of Rs.3,500/- has been deducted as income tax and Rs.200/- as professional tax. If these two tax

: 16 : components are deducted, the salary of victim for the purpose of computing loss of dependency works out to Rs.45,972/-, which the tribunal has correctly taken. In view of our opinion that ‘split multiplier’ formula cannot be applied, 30% of victim’s earnings will have to be added towards future prospects as victim was aged 47 years. There are four claimants and therefore 1/4th of victim’s salary will have to be deducted towards his personal expenditure. The applicable multiplier will be 13. Thus, loss of dependency is recomputed based on these parameters. 22. In addition, claimants No.1 to 3 shall be entitled for consortium at the rate of Rs.40,000/- each. Claimant No.4 being victim’s mother will also be entitled for filial consortium at Rs.40,000/-. The claimants are also entitled for Rs.30,000/- on other conventional heads. The total enhanced compensation is computed as follows:

: 17 : Sl.No. Heads Amount 1 Loss of dependency (45972 + 30% minus 1/4th x 12 x 13) Rs.69,92,388/- 2 Loss of consortium (40,000 x 4) Rs.1,60,000/- 3 Conventional heads Rs.30,000/- TOTAL Rs.71,82,388/- Less: Compensation awarded by the tribunal. Rs.48,26,088/- Enhanced compensation: Rs.23,56,300/-

In view of the above, we answer this point in the affirmative. Hence, the following: ORDER (i) Appeal filed by the insurer is dismissed. (ii) Cross objection filed by the claimants is allowed in part holding that the claimants shall be entitled for enhanced compensation of Rs.23,56,300/-. (iii) Insurer shall deposit the enhanced compensation with interest at 6% p.a. from the date of petition till the date of deposit, within a period of six weeks from the date of receipt of a copy of this judgment for disbursement in accordance with law.

: 18 : (iv) Registry shall transfer the amount in deposit to the tribunal. No costs.

SD/- JUDGE

SD/- JUDGE Mrk/-