National Insurance Company Limited vs Tsewang Namgyal And Others

Impugned in this Appeal under Section 173 of the Motor Vehicles Act, is Award dated 9th June 2012, passed by Motor Accident Claims Tribunal,

Leh (for short “Tribunalâ€) on a claim petition, bearing File no.10, titled Tsewang Namgyal and another v. National Insurance Company and

another, directing National Insurance Company Limited â€" appellant herein, to pay compensation of Rs.11,65,700/-along with interest @ 8% per

annum, to claimants/respondents 1&2, primarily on the ground that Tribunal has wrongly taken monthly income of deceased as Rs.6000/- and

thereafter made 30% increase on account of future prospects as income of deceased was not proved by any independent evidence, particularly when

deceased was a non-salaried person; that Tribunal has erred in applying multiplier; that Tribunal has erred in awarding Rs.10,000/- on account of

funeral expenses; that Tribunal has erred in awarding Rs.20,000/- on account of medical expenses; that Tribunal has wrongly given Rs.12,500/- on

account of loss of estate; that interest @ 8% has wrongly been given by Tribunal. Another submission of learned counsel for appellant Insurance

Company is that Tribunal has wrongly deducted only 1/3rd of income of deceased, instead of ½ of income towards personal and living expenses.

Heard and considered.

It may be mentioned here that there is no dispute as regards death of Nawang Gyatso, due to vehicular accident on 23rd July 2009. On claim

petition of claimants/respondents 1&2, written statements were filed by respondents before the Tribunal, which includes present appellant Insurance

Company. The Tribunal, vide order dated 11th October 2011, framed following four Issues for adjudication:

1) Whether petitioners’ son Nawang Gyatso died in a road accident of vehicle bearing registration No.JK10-3543 at ITBP Gate Choglamsar due

to the rash and negligent driving of respondent no.3? OPP

2) Whether petitioners’ son was earning Rs.17,000/- per month and was 24 years old at the time of accidental death? OPP

3) If issues 1 and 2 are proved in affirmative, to what amount of compensation petitioners are entitled. OP Parties

4) Relief.

Claimants/respondents produced and examined as many as four witnesses, besides claimant no.1, before the Tribunal in support of their claim.

Appellant Insurance Company produced one witness, namely, Khushal Chand, Manager, National Insurance Company, Branch Leh.

Insofar as Issue no.1 is concerned, it was proved before the Tribunal that claimants’ son died due to vehicular accident and, accordingly, Issue

no.1 was decided in their favour.

Qua earning of income by claimants’ son, they claimed deceased was earning Rs.7000/- per month as driver with a contractor, besides he used

to work as carpenter during spare time, earning Rs.10,000/- per month. The Tribunal discussed this aspect of the matter in detail. The Tribunal found

that claimants could not furnish details of contractor with whom deceased was working as driver nor claimants could provide name of

person/establishment with whom deceased was working as carpenter. Tribunal also observed that during cross-examination, claimant no.1 stated that

his son was working in a shop at Housing Colony as partner but failed to produce any proof with respect thereto. The Tribunal, after considering all

facets of matter and deciding Issue no.2, took average income of deceased as Rs.6000/- per month. Submission of learned senior counsel for appellant

Insurance Company that taking of monthly income of deceased Rs.6000/- by the Tribunal is on higher side, is hollow, given the law laid down by the

Supreme Court in Sunita Tokas and another v. New India Insurance Co. Ltd and another, 2019 SCC Online SC 1045 : 2019 (11) SCALE 24, in which

monthly income of deceased was enhanced from Rs.7,500/- to Rs.12,000/-. In aforesaid cited case, accident had taken place in the year of 2004

whereas in the case in hand, the accident has taken place in the year 2009. Therefore, taking income of deceased as Rs.6000/- per month, by the

Tribunal, does not need any interference. Thereafter, Tribunal took age of deceased between 25 to 30 years at the time of death; the same also needs

no interference.

It may not be out of place to mention here that the Supreme Court in Ramachandrappa v. Manager, Royal Sundaram Alliance Insurance Company,

(2011) 13 SCC 236, reckoned monthly income of a coolie (manual labourer), who met with a road accident in the year 2004, at the age of 35 years,

notionally as Rs.4,500/-. The Supreme Court held that claimant, who was working as a coolie, cannot be expected to produce any documentary

evidence to substantiate his claim. In absence of any other evidence contrary to claim made by claimant, in the facts of the said case, the Tribunal

should have accepted claim of claimant. The Supreme Court has made it clear that in all cases and in all circumstances, Tribunal need not to accept

claim of claimant, in absence of supporting material. It depends on the facts of each case. In a given case, if claim made is so exorbitant or if claim

made is contrary to ground realities, Tribunal may not accept claim and may proceed to determine possible income by resorting to some guess work,

which may include the ground realities prevailing at relevant point of time.

Again, the Supreme Court in Syed Sadiq v. Divisional Manager, United India Insurance Co. Ltd., (2014) 2 SCC 735, while taking note of earlier

decision in Ramachandrappa’s case (supra), reckoned monthly income of a vegetable vendor, who met with a road accident in the year 2008, at

the age of 24 years, notionally as Rs.6,500/-. In the said decision, the Supreme Court held that a labourer in an unorganized sector doing his own

business could not be expected to produce documents to prove his monthly income. Therefore, there was no reason for Tribunal and High Court to

ask for evidence to prove his monthly income. Going by the state of economy, prevailing at that time and rising prices in agricultural products, the

Supreme Court accepted his case that a vegetable vendor was reasonably capable of earning 6,500/- per month.

A Constitution Bench of the Supreme Court in National Insurance Company Ltd v. Pranay Sethi, (2017) 16 SCC 680, has held that Section 168 of

Motor Vehicles Act, 1988, deals with concept of ‘just compensation’ and same has to be determined on foundation of fairness, reasonableness

and equitability on acceptable legal standard because such determination can never be in arithmetical exactitude. It can never be perfect. The aim is to

achieve an acceptable degree of proximity to arithmetical precision on the basis of materials brought on record in an individual case. The conception of

‘just compensation’ has to be viewed through the prism of fairness, reasonableness and non-violation of the principle of equitability. In a case of

death, the legal heirs of the claimants cannot expect a windfall. Simultaneously, the compensation granted cannot be an apology for compensation. It

cannot be a pittance. Though the discretion vested in the Tribunal is quite wide, yet it is obligatory on the part of the Tribunal to be guided by the

expression, i.e., just compensation. Having said that, submission is Mr.J.A. Kawoosa, learned senior counsel appearing for appellant Insurance

Company, that claimants could not prove income of deceased before the Tribunal, is specious.

The Tribunal after deciding Issues 1&2 in favour of claimants, discussed and decided Issue no.3 as to what amount of compensation claimants

were entitled to. The Tribunal rightly calculated Rs.72,000/- as annual income of deceased. Tribunal applied 30% future prospects. According to

learned counsel for appellant Insurance Company, Tribunal has erred and wrongly given 30% future prospects. Submission of learned counsel for

appellant Insurance Company that addition of 30% as future prospects was wrongly given by the Tribunal, is misconceived in view of law laid down

by the Supreme Court in Pranay Sethi (supra). It is made clear here that Tribunal had been conservative in awarding only 30% future prospects

whereas 40% future prospects was to be awarded. So, the Award to this extent requires to be modified. Thus, loss of income shall be Rs.72,000/- per

annum and 40% future prospects shall be added thereto, which comes out to Rs.1,00,800/- (Rs.72,000 + Rs.28,800).

There is, however, weight in submission of learned counsel for appellant Insurance Company that Tribunal has erred in deducting 1/3rd of income

of deceased instead of half (½) of income towards personal and living expenses. Half of income was to be deducted as deceased was a bachelor.

To this extent Award requires to be set-aside and modified. Again, reference in this regard is made to Sarla Verma v. Delhi Transport Corporation

2009 (6) SCC 121 and Pranay Sethi (supra). Thus, from Rs.1,00,800/- calculated as annual income of deceased, half (1/2) is to be subtracted for

personal and living expenses of deceased, which comes out as Rs.50,400/- (Rs.1,00,800 â€" Rs.50,400). In that view of matter total compensation

payable to claimants on account of loss of income comes to Rs.50,400 x 18 = Rs.9,07,200/-.

As regards compensation given by Tribunal on other heads/ components, those need not be interfered with.

However, insofar as contention of learned counsel for appellant as regards payment of interest @ 8% per annum is concerned, the same has sum and

substance. Tribunal has wrongly applied 8% interest. There shall be interest of 6% per annum from the date of institution of the claim till final

realisation. So, the Award to that extent is set-aside and 6% interest per annum shall be paid by appellant Insurance Company from the date of filing

of claim petition till final realisation.

For the reasons discussed above, the Appeal is partly allowed in the following manner:

A. Loss of income = Rs.9,07,200.00

B. Funeral expenses = Rs. 10,000.00

C. Medical expenses = Rs. 20,000.00

D. Loss of estate = Rs. 12,500.00

Total compensation = Rs.9,49,700.00

Claimants/respondents 1&2 are entitled to compensation of Rs.9,49,700/- along with interest @ 6% per annum from the date of institution of claim

petition till its final realisation.

Appellant Insurance Company is directed to pay the aforesaid amount of Rs.9,49,700/- along with interest @ 6% per annum from the date of

institution of claim petition till its final realisation. Amount, if any, received by claimants/respondents 1&2 shall be deducted from the amount as

awarded finally.

Disposed of in terms of above.

Record of the Tribunal, if summoned/received, be sent down along with copy of this judgement.