Pr. Commissioner of Income Tax-2 vs. Sri G. Mahesh Babu

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IN THE GAUHATI HIGH COURT

(HIGH COURT OF ASSAM, NAGALAND, MIZORAM & ARUNACHAL PRADESH) Principal Seat at Guwahati MACApp./208/2016 1. Miss Hirjir Ingtipi,

D/o Late Kareng Kropi;

S/o Late Kareng Kropi,

Both are R/o Ward No. 4, P.S. Dokmoka,

Dist. Karbi Anglong, Assam.

……..Appellants

-Versus-

S/o Sri Longki Ingti,

R/o Ward No. 4, P.S. Dokmoka,

Dist. Karbi Anglong, Assam.

…….Respondents

- B E F O R E- HON’BLE MR. JUSTICE ROBIN PHUKAN

Advocate for the appellants : Ms. P. Bhattacharya

Advocate for the respondents : Ms. R.D. Mozumdar (for R-1)

GAHC010021842016

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Date of hearing & judgment : 19.06.2025

JUDGMENT & ORDER (ORAL)

Heard Ms. P. Bhattacharya, learned counsel for the appellants. Also heard Ms. R.D. Mozumdar, learned counsel for the respondent No. 1. 2. This appeal, under Section 173 of the M.V. Act, is directed against the judgment and award dated 08.06.2016, passed in MAC Case No. 931/2013, by the learned Additional District Judge (FTC) No. 3, Kamrup(M), Guwahati-cum-Member, Motor Accident Claims Tribunal, Kamrup(M), Guwahati, in MAC Case No. 931/2013. 3. The background facts, leading to filing of the present appeal, are briefly stated as under: “On 11.04.2013, at about 1.30 p.m., Smt. Kareng Kropi, the mother of the present appellants/claimants, was travelling along with claimant/appellant No. 1, Ms. Hirjir Ingtipi in a Santro-LE vehicle, bearing Registration No. AS-09-B-2641, from Bakalia side towards Diphu side, and when the vehicle reached Patradisha Singnar Basti, the driver of the said vehicle lost control over the vehicle and hit against a concrete culvert by the side of the road and fell into a ditch by the side of the road. As a result of the said accident, the deceased sustained grievous injuries on her person and she succumbed to her injuries on the next day. The said accident took place due to rash and negligent driving of the driver of the said vehicle and in connection with the said accident, Bokolia P.S. Case No. 14/2013, under Sections 279/304A IPC was registered. The deceased at the time of accident was working as

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Assistant Teacher of Mirmili Adong L.P. School and her monthly salary was Rs. 24,867/-, and she left behind the claimants i.e. one daughter and one minor son. The family was totally dependent on the income of the deceased and there is no other alternative source and the entire family is suffering financially.

Thereafter, the appellants herein being claimants, preferred a petition under Section 166 of the M.V. Act, claiming a sum of Rs. 30,00,000/- being the compensation. The opposite party, i.e. respondent No.1, the Oriental Insurance Company Ltd., contested the case of the claimants by filing a written statement, wherein it had taken a stand that no authentic document like age certificate, income certificate, income tax return etc. were submitted with regard to the claim of the accident and the amount of compensation was high, excessive, exorbitant and baseless, and therefore, it was contended to dismiss the petition.

Upon the pleadings of the parties, the learned Tribunal had framed the following two issues: (i) Whether the late Kareng Kropi died of injuries she suffered in the alleged road accident dated 11.04.2013 involving vehicle No. AS-09-B-2641 and whether the said accident took place due to rash and negligent driving by the driver of the offending vehicle? (ii) Whether the claimants are entitled to get any compensation and if yes, to what extent and by whom amongst the opposite parties, the said compensation amount be payable?

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Thereafter, recording evidence and hearing both the parties, the learned Tribunal had assessed the compensation as under: (i) Loss of dependency

: Rs. 80,000/- (ii) Funeral expenses : Rs. 25,000/- (iii) Loss of love and affection : Rs. 50,000/-

Total

: Rs. 1,55,000/-

And the learned Tribunal had further directed that the amount shall carry interest @6% per annum from the date of filing of the claim case till payment.” 4. Ms. Bhattacharya, learned counsel for the appellants has assailed the impugned judgment and award on two counts. Firstly, Ms. Bhattacharya submits that while assessing the loss of dependency, the learned Tribunal has not applied the multiplier; and secondly, Ms. Bhattacharya submits that while assessing the compensation, the learned Tribunal has not considered the future prospect as at the relevant point of time, the deceased was serving as Assistant Teacher in Mirmili Adong L.P. School and her monthly income was Rs. 24,867/-, and her age at the relevant point of time was 40 years. Further, Ms. Bhattacharya submits that there is no dispute regarding the age and income, and in view of the decision of the Hon’ble Supreme Court, 30% has to be added as future prospect, and since the aforesaid aspect has not been taken into account by the learned Tribunal, the impugned judgment and award is illegal and arbitrary, and therefore, it is contended to interfere with the same. Ms. Bhattacharya also submits that the learned Tribunal had awarded 6% interest from the date of filing of the claim petition, but in view of the decision of Hon’ble Supreme Court in the case of Smt. Neeta W/o

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Kallapa Kadolkar and Ors. Vs. the Divisional Manager, MSRTC, Kohlapur, reported in (2015) 1 TAC 340 (SC), and also in view of the decision in the case of Municipal Corporation of Delhi vs. Association, Victims of Uphaar Traegedy and Ors., reported in (2011) 14 SCC 481, the claimants are entitled to 9% interest, and in view of the decision in the case of Santosh Devi vs. National Insurance Co. Ltd. and Ors., reported in (2012) 6 SCC 421, 30% has to be added as future prospect. 5. Per contra, Ms. Mozumdar, learned counsel for the respondent No. 1, fairly summits that there is no dispute regarding age and income of the deceased, and also she submits that while assessing the compensation for loss of dependency, the learned Tribunal has not given any reason as to why and how it has arrived at the conclusion that the claimants are entitled to Rs. 80,000/- for loss of dependency, and that no multiplier has been applied. Further, Ms. Mozumdar has pointed out that there is also no dispute regarding the entitlement of 30% of future prospect in view of the decision of the Honourable Supreme Court in the case of National Insurance Company Ltd. vs. Pranay Sethi, reported in (2017) 16 SCC 680. Ms. Mozumdar also pointed out that the learned Tribunal has awarded a sum of Rs. 50,000/- as loss of love and affection, but the claimants are not entitled to the aforesaid amount in view of the decision of Pranay Sethi (supra). Under such circumstances, Ms. Mozumdar submits that the just compensation which the claimants are entitled to in accordance with law, may be calculated, however, the learned Tribunal has given the liberty to the respondent No. 1 to recover the said amount from the insured. 6. Having heard the submissions of the learned counsel for both the parties, I have carefully gone through the memo of appeal and the

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grounds mentioned therein, and also perused the impugned judgment and award dated 08.06.2016, and the decisions referred by learned counsel for both the parties, and I find substance in the submission of the learned counsel for both the parties. 7. It appears that while assessing the compensation under the head of loss of dependency, the learned Tribunal has awarded a sum of Rs. 80,000/-, but how the aforesaid sum has been assessed, there is no indication in the impugned judgment and award, and no multiplier was applied by the learned Tribunal. And the income and the age of the deceased was also not taken into account. 8. How to assess the compensation in a case under Section 166 of the M.V. Act is well settled by Hon’ble Supreme Court in catena of decisions, including in the case of Sarla Verma and Ors. vs. Delhi Transport Corporation and Anr., reported in (2009) 6 SCC 121. In para Nos. 18 and 19 of the said case, Hon’ble Supreme Court has discussed the principle as under:- 18. Basically only three facts need to be established by the claimants for assessing compensation in the case of death: (a) age of the deceased; (b) income of the deceased; and (c) the number of dependants.

The issues to be determined by the Tribunal to arrive at the loss of dependency are:

(i) additions/deductions to be made for arriving at the income;

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(ii) the deduction to be made towards the personal living expenses of the deceased; and (iii) the multiplier to be applied with reference to the age of the deceased.

If these determinants are standardised, there will be uniformity and consistency in the decisions. There will be lesser need for detailed evidence. It will also be easier for the insurance companies to settle accident claims without delay.

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from the said table with reference to the age of the deceased. Step 3 (Actual calculation) The annual contribution to the family (multiplicand) when multiplied by such multiplier gives the “loss of dependency” to the family. Thereafter, a conventional amount in the range of Rs 5000 to Rs 10,000 may be added as loss of estate. Where the deceased is survived by his widow, another conventional amount in the range of 5000 to 10,000 should be added under the head of loss of consortium. But no amount is to be awarded under the head of pain, suffering or hardship caused to the legal heirs of the deceased. The funeral expenses, cost of transportation of the body (if incurred) and cost of any medical treatment of the deceased before death (if incurred) should also be added.

“24. In Susamma Thomas [(1994) 2 SCC 176 this Court increased the income by nearly 100%, in Sarla Dixit [(1996) 3 SCC 179] the income was increased only by 50% and in Abati Bezbaruah [(2003) 3 SCC 148] the income was increased by a mere 7%. In view of the imponderables and uncertainties, we are in favour of adopting as a rule of thumb, an addition of 50% of actual salary to the actual salary income of the deceased towards future prospects, where the

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deceased had a permanent job and was below 40 years. (Where the annual income is in the taxable range, the words “actual salary” should be read as “actual salary less tax”). The addition should be only 30% if the age of the deceased was 40 to 50 years. There should be no addition, where the age of the deceased is more than 50 years. ………..”

9.1. And in view of the decision of Hon’ble Supreme Court in Pranay Sethi (supra), the claimants are entitled to 30%, to be added while assessing the compensation under the head of loss of dependency. Further, it appears that the age and income of the deceased have not been disputed. The deceased was working as an Assistant Teacher at the relevant point of time in Mirmili L.P. School and her monthly income has been proved by P.W.2, vide Exhibit-4, which is salary certificate, which indicates that her total salary was Rs. 27,260/-, and the relevant point time, the age of the deceased was 40 years as it appears from the P.M. report (Exhibit-2) and the same has also not been disputed. 10. Thus, the amount of just compensation, which the appellants herein are entitled to in view of the aforementioned settled propositions of law, is being assessed as under:- 10.1. As discussed herein above, the age of the deceased, at the relevant time of accident was 40 years. Therefore, the multiplier applicable herein this case would be 15 as per the decisions of Sarla Verma (Supra). Indisputably, the deceased was serving as Assistant Teacher of Mirmili Adong L.P. School. Her salary, as per Exhibit-4 was Rs. 27,260/- and after deduction of professional tax i.e. Rs. 208/- the same was Rs. 27,052/- per month. Thus, having accepted the income of the deceased at Rs. 27,052/- per month, 25% of the same has to be added as future prospect, as at the time of accident the deceased was

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40 years, in view of the decision of Hon’ble Supreme Court in the case of Pranay Sethi (supra). Though Ms. Bhattacharya submits that the future prospect herein this case should be 30 % yet said submission left this Court unimpressed. Had the age of the deceased should have been below 40 years only then addition would have been 40%. Since the deceased had completed 40 years then the addition should be 25%. After addition of 25% to Rs. 27,052/-, the amount would be Rs. 33,815/- (Rs.27052/-+Rs.6763/-=Rs.33815/-). 10.2. Thereafter, in view of the decision of Hon’ble Supreme Court in the case of Sarla Verma (Supra), 1/3rd of the aforesaid amount has to be deducted as personal expenses since she left behind two dependants at the time of accident. After deducting 1/3rd of the above, the amount would be Rs. 33815-11271.66 (rounded off at Rs. 11,272/-)= Rs.22,543/-]. After application of multiplier, the amount would be Rs.40,57,740 (Rs.22,543 x 15 x 12 = Rs.40,57,740/-). 10.3. Besides, under the conventional heads, a sum of Rs. 40,000/- each with 10% increase in every three years has to be awarded under the head - consortium, and a sum of Rs. 15,000/- under head - funeral expenses, and the aforesaid amounts should be enhanced by 10% in every 3 years, and a sum of Rs. 15,000/- under head - loss of estate, and the aforesaid amounts should be enhanced by 10% in every 3 years in view of the decision of Hon’ble Supreme Court in the case of Pranay Sethi (supra). It is to be noted here that after the accident almost 15 years elapsed. That being so, the aforesaid amounts have to be enhanced by five times.

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10.4. The whole calculation, after application of the principle laid down in the case of Sarla Verma (Supra) and also in the case of Pranay Sethi (Supra), would be as under:-

Sl. No. Heads Calculation I Monthly income Rs. 27,052/

II 25% of (i) to be added as future prospect=Rs.33,815/- (Rs.27052/- + Rs. 6763/- = Rs. 33,815/-) Rs. 33,815/- III 1/3rd of the (ii) deducted as personal expenses of the deceased = 33815- 11271.66 (rounded off at Rs. 11,272/- ) = Rs.22,543/-]. Rs. 22,543/- IV Compensation after multiplier of 15 is applied Rs. 40,57,740/- (Rs.22,543 x 15 x 12 = Rs.40,57,740/-). Rs. 40,57,740/- V Loss of Estate Rs.15,000/- which has to be increased by 10% in every three years (15,000 x 10/100) = 1500 x 5 = Rs.7500/- Rs.15,000/-+ Rs.7,500/-= Rs.22,500/- VI Loss of Consortium =Rs.40,000/-, which has to be increased by 10% in each three years 40,000 x 10/100 = 4000 x 5 = 20,000. (Rs.40,000 + 20,000 = Rs.60,000/- Rs. 40,000/- + Rs.20,000/- =Rs.60,000/

VII Funeral expenses Rs.15,000/-, which has to be increased by 10% in each three years 15,000 x 10/100 = 1500 x 5 =Rs.7500/- Rs.15,000/-+ Rs.7500/-= Rs.22,500/-

Total compensation awarded =

Rs. 41,62,740/-

10.5. At the relevant time, the vehicle was insured with the respondent/opposite party No.1 i.e. Oriental Insurance Company Limited, vide Policy No. 321201/31/2013/5554 and the same was valid

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up to 29.10.2013. The accident took place on 11.04.2013, and as such at the relevant point of time, the policy was in force. This is an undisputed fact. 10.6. It also appears that at the relevant time the driver/respondent No.2 had a driving licence, bearing No. AS- 0920000007899. Further, it appears that the said driving licence was valid until 26.09.2018, as per Exhibit-1, the Accident Information Report. Thus, the learned Tribunal had rightly saddled the burden of payment of the compensation upon the respondent No.1 herein. Finding:- 11. In the result, this appeal is allowed. The impugned Judgment and Award, dated 08.06.2016, stands modified to the extent indicated above. 12. The respondent No.1, i.e. the Oriental Insurance Company Limited, is directed to pay a sum of Rs. 41,62,740/-/- (Rupees Forty one lacs Sixty Two Thousand Seven Hundred and Forty) only, being the compensation, which according to this Court is just compensation, here in this case. The amount, if already paid to the claimant has to be deducted from the aforesaid amount. 13. The learned Tribunal has awarded interest @ 6% per annum from the date of filing of the claim petition. But, the same stands enhanced to 9% per annum, in view of the decision of Hon’ble Supreme Court in the case of Municipal Corporation of Delhi vs. Uphaar Tragedy Victims Association and Others, reported in (2011) 14 SCC 481. In the said case, it has been held that the interest upon the compensation amount @ 9% per annum, would be justified. Same

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principle was followed in the case of Kalpanaraj vs. Tamil Nadu State Transport Corporation, reported in (2014) C.R. 693 (SC). 14. The respondent No. 1 shall deposit the aforesaid amount before the learned Tribunal within a period of 30 days from the date of receipt of the certified copy of this judgment and award. The appellants herein shall obtain a certified copy of this judgment and order and place the same before the respondent No. 1 within a period of one week from today. It is further provided that the respondent No. 1 shall deposit the aforesaid amount of compensation along with interest thereon in the learned Tribunal in following manner:- (i) Both dependents (appellant No.1 and 2) shall be entitled to apportion the awarded amount under the head No. (iv) i.e. loss of dependency and other heads in equal share. (ii) 50% of the amount payable to the dependent/appellant No.1, shall be deposited in Term deposit of five years and 30% thereof in Term deposit for two years in a Branch of Public Sector Bank nearest to her permanent residence. Rest of the amount shall be paid to her for her expenses. (iii) 60% of the amount payable to the minor son/appellant No.2, shall be deposited in Term deposit of five years and 30% thereof in Term deposit for two years in a Branch of Public Sector Bank nearest to his permanent residence. (iv) The Term deposit to the minor shall be renewed periodically until he attain majority. Rest of the amount payable to the minor son shall be paid to the dependent/appellant No.1 his elder sister, for his expenses. However, in exigencies, the

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dependent/appellant No.1 will be entitled to withdraw the amounts deposited in Term deposit above with leave of the Tribunal on sufficient cause being shown. 15. In terms of above, this MAC Appeal stands disposed of. The Registry shall send down the record of the learned Tribunal with a copy of this judgment and order forthwith. The parties have to bear their own cost.

J U D G E

Comparing Assistant