VIMAL KANWAR vs. KISHORE DAN .

Case Type: Civil Appeal

Date of Judgment: 03-05-2013

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REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.5513 OF 2012 (arising out of SLP(C)No.6367 of 2012) VIMAL KANWAR & ORS.        …. APPELLANT VERSUS KISHORE DAN & ORS.           ….RESPONDENTS J U D G M E N T SUDHANSU JYOTI MUKHOPADHAYA, J. The present appeal is filed against the judgment of  the  Rajasthan High Court,  Jaipur Bench in S.B. Civil  Misc.   Appeal   No.   1831   and   2071   of   2003.       By   the  th impugned judgment dated 29   July, 2011, the Rajasthan  JUDGMENT High Court  upheld the compensation awarded by the Motor  Accident  Claims  Tribunal,  Jaipur  (hereinafter  referred  to as the ‘Tribunal’)  and observed as  follows: “13. In  the  situation,  in  the  light  of  the  above   detail   and   analysis   it   appears   that   the  learned tribunal’s basis of calculating amount of  compensation might be erroneous but in totality  determined, assessed and awarded total amount of  compensation   Rs.14,93,700/­   is   proper   and  justified,   and   there   is   no   adequate   basis   for  increasing   or   reducing   it.   Therefore,   judgment  dated   21.06.2003   by   Motor   Accident   Claims  Tribunal, Jaipur is affirmed and appeals by the  appellants and Insurance Company are dismissed.” 1 Page 1 th  2.   The   factual   matrix   of   the   case   is   that   on   14 September,   1996   one   Mr.   Sajjan   Singh   Shekhawat   was  sitting on his scooter which was parked on the side of  the  road  and was  waiting  for  one Junior  Engineer,  N.  Hari Babu and another whom he had called for discussion.  At that time, the non­applicant No.1, driver of the Jeep  No.RJ­10C­0833   came   driving   from   the   Railway   Station  side with high speed, recklessly and negligently and hit  the scooter. Sajjan Singh along with his scooter came  under the Jeep and was dragged with the vehicle.  Due to  this accident fatal injuries was caused to him and on  reaching the Hospital he expired.  The scooter was also  damaged completely. 3.  Appellant no. 1, the wife of the deceased was aged  about 24 years;  appellant no. 2, the  daughter was aged  JUDGMENT about 2 years and appellant no. 3,   the   mother   was  aged   about   55   years   at   the   time   of     death   of   the  deceased.  They jointly  filed an application to the Tribunal alleging that negligent and rash driving by non-applicant no. 1 caused the death of Sajjan Singh and claimed compensation of Rs.80,40,160/­.   It was brought  to the notice of the Tribunal that non­applicant no. 1,  the   jeep   driver   was   in   the   employment   of   the   non­ 2 Page 2 applicant no. 2 and the non­applicant no. 3, the United  India Insurance Co. Ltd. was the insurer of the vehicle.  4. The   non­applicant   No.3,   Insurance   Company   on  appearance filed written statement and alleged that the  vehicle   owner   has   violated   the   conditions   of   the  Insurance   Policy   by   not   informing   them   about   the  accident.  Further,  according to the Insurance Company  the vehicle owner should prove the fact that at the time  of   accident,   the   Jeep   driver,   non­applicant   No.1   was  holding a valid and effective driving licence. 5. Altogether five issues were framed by the Tribunal:  “1. Whether due to the vehicle in question Jeep  No. RJ 10C 0833 being driven by driver, non­ applicant   No.1   on   14.09.1996,   in   front   of  Assistant   Engineer   Office,   PWD,   within   the  jurisdiction   of   Police   Station   Churu,  negligently   and   recklessness   and   caused  accident   and   injuries   due   to   which   Sajjan  Singh Shekhawat S/o Bhanwar Singh expired. JUDGMENT 2. Whether above said vehicle driver at the time  accident   was  in employment  of  non­applicant  No.2   and   was   working   for   his   benefit   and  profit.  3. Whether   the   non­applicant   No.3,   Insurance  Company in view of the preliminary objections  and preliminary statement in their reply, are  relieved of their liability and if not what  is the effect thereon.  4 Whether the applicant are entitled to get the  claim amount or any other justified amount,  and if yes which applicant is entitled to how  much   compensation   and   from   which   non­ applicant. 5. Relief.”. 3 Page 3 6. The first issue was answered by the Tribunal in an  affirmative manner.  It was  held that the reckless and  negligent driving of the driver of  Jeep No.RJ 10C 0833  caused   the   accident   which   resulted   in   the   death   of  Sajjan Singh Shekhawat.   Issue Nos. 2 and 3 were also  decided in favour of the applicants. 7. Issue Nos. 4 and 5 were related to the entitlement  of appellants towards the claims and the relief to be  granted.     The Tribunal determined the compensation to  be granted in favour of the appellants at Rs.14,93,700/­  jointly.  8. The actual salary  of the deceased was reduced by  the   Tribunal   by   deducting   certain   amounts   towards  Provident   Fund,   Pension   and   Insurance.     Without   any  JUDGMENT reason,   the   Tribunal   also   reduced   the   salary   at   Rs.  8,000/­ per month though actual salary of the deceased  as per Last Pay Certificate (for short ‘LPC’) was Rs.  8,920/­. Out of such reduced salary of Rs. 8,000/­,  the  Tribunal further deducted a sum of Rs.1,000/­ per  month  towards   Provident   Fund,   Pension   and   Insurance   and  thereby  considered  the  actual salary of deceased to  be  Rs.7,000/­ per month.  An amount of Rs. 4500/­ was  added to it towards future income and, thereby the net  4 Page 4 income of deceased was assessed at 11,500/­ per month  (Rs.7,000/­ + Rs.4,500/­). 9. Admittedly,   Sajjan   Singh   died   at   the   age   of   28  years and 7 ½  months .  He was in the services of the  State Government posted as an Assistant Engineer.   In  the   normal   course,     he   would   have   continued   in   the  services  of the  State  Government  upto  February,  2026,  until   attaining   58   years   or     upto     February,   2028,  until attaining 60 years. As per the decision of this  Court   in   the   case   of   Sarla   Verma   &   Ors.     v.   Delhi  Transport Corporation & Anr. (2009) 6 SCC 121,    Sajjan  Singh having died at the age of   28 years 7 ½ months,  the multiplier of 17 is applicable in calculating the  compensation.     But   the   Tribunal   applied   the   lower  multiplier of 15 on the ground  that the wife would be  JUDGMENT getting   family   pension   and   would   get   job   on   the  compassionate   ground   and   the   daughter,   aged   about   2  years would get married in future. 10. Though the High Court noticed the aforesaid mistake  it upheld the compensation.    A notional deduction of  income tax was made by the High Court from the salary of  the deceased apart from the deduction of  annual pension  and came to the conclusion that the award passed by the  5 Page 5 Tribunal was just and proper as  apparent from paragraph  11 of the judgment which reads as under:  11. If   calculate   according   to   the   rate   of  tax   in   the   year   1996,   we   find   that   in   the  assessment year 1996­97 on Rs.40,000/­ no tax was  payable.   On further income of Rs.20,000/­, 20%  was   payable,   on   further   income   of   Rs.60,000/­,  rd 30% of income was taxed.  1/3  of the salary or  Rs.15,000/­   which   ever   was   less   was   standard  deduction.  Accordingly deducting Rs.15,000/­ as  standard   deduction   taking   into   account   the  savings   and   on   applying   rebate   of   Rs.12,000/­  under   Section   80C   of   the   Income   Tax   Act,   the  amount   which   remains,   on   that   Rs.5812/­   is  payable   as   tax.   Thus,   deducting   taxable   amount  out   of   income   is   Rs.1,01,228/­.   The   appellant  Vimal Kanwar has herself stated that after death  of her husband she receives Rs.1460/­ per month  as   pension.     The   pension   received   on   death   of  husband   should   also   be   deducted.     Thus,   on  deducting   annual   pension   of   Rs.17,520/­   the  income is Rs.1,83,708/­ per annum. According to  Sarla Verma judgment increasing 50%   for future  prospects   the   amount   becomes   Rs.1,25,562/­   per  rd annum, out of this deducting 1/3   for personal  expenses of the deceased and applying multiplier  of   17   according   to   age   of   the   deceased   this  amount is Rs.14,23,036/­. The tribunal on account  of   being   deprived   of   income   the   deceased   has  granted Rs.14,78,700/­ to the deceased.” JUDGMENT 11. The   High   Court   noticed   that   the   Tribunal   wrongly  applied the multiplier of 15 but refused to interfere  with the award on the following grounds: “ 12.    IT is correct, that despite the revise  LPC being on record and showing salary to be  Rs.8920/­ the tribunal has accepted salary to  be Rs.8000/­ only out of this on account of  GPF   and   State   Insurance   Rs.1000/­   has   been  deducted   and   monthly   income   is   assessed   as  Rs.7,000/­.   Thereafter,   taking   into   account  increasing   income   in   future   etc.   Rs.4500/­  has been added and monthly income is assessed  6 Page 6 to be Rs.11500/­ this assessment according to  evidence on record and established law, does  not   appear   to   be   proper.   It   is   also   worth  mentioning   that   the   tribunal   for   granting  compensation to the appellants has taken unit  method   has   basis   but   while   doing   so   the  amount that the deceased would have spent on  his personal expenses which is deductable as  per judgment of the Hon’ble Supreme Court in  the Sarla Verma case and other cases has not  been   deducted,   because   of   which   the  dependency   is   not   properly   assessed.  Thereafter, the multiplier of 15 applied by  the   tribunal   also   does   not   seen   to   be   in  accordance   to   law.   It   is   also   worth  mentioning that assessing amount in the said  manner   the   tribunal   had   not   deducted   the  payable income tax and the amount of pension  received by Smt. Vimal Kanwar due to death of  deceased.   Similarly,   while   assessing  dependency   deduction   for   GPF   and   State  Insurance, addition of Rs.4,500/­ in monthly  income and multiplier of 15 etc. is not in  accordance   with   law.     But   it   is   worth  mentioning that taking income of the deceased  at   the  time   of  the   accident  is   Rs.8,920/­,  deducting   payable   income   tax   and   amount   of  pension received by the wife of the deceased,  the amount on account of loss of income to be  given   to   the   appellant   comes   to  Rs.14,23,036/­. It appears that the tribunal  on   account   of   loss   of   income   has   granted  Rs.14,78,700/­   and   for   all   the   remaining  heads a total of Rs.15,000/­ only, which is  definitely too less. All the three appellants  should  be  granted  proper   compensation  under  heads of cooperation from the deceased, loss  of   love   and   affection   and   service,  protection, last rites, lost of estate and on  doing   this   the   situation   that   emerges   is  that,   the   total   amount   of   Rs.14,93,700/­  awarded   by   tribunal   as   compensation   is  justified and therefore, any interference in  the   amount   of   awarded   compensation   is   not  proper desirable or necessary.” JUDGMENT 7 Page 7 12. Two   appeals,   one   preferred   by   the   appellants­ claimants   and   another   by   the   Insurance   Company,   were  dismissed by the High Court by common impugned judgment  th dated 29  July, 2011.  13. From the facts and circumstances of the case,  the  grievance   of   the   appellants   can   be   summarized   as  follows:­  (i)   No amount can be deducted  towards Provident  Fund,   Pension   and   Insurance   amount   from   the   actual  salary of the victim for calculating compensation. (ii)     In   the   absence   of   any   evidence,   the   Court  suo motu   cannot deduct any amount towards income tax  from the actual salary of the victim.   (iii)   On   the   facts   of   the   present   case,   the  Tribunal   and   the   High   Court   should   have   doubled   the  JUDGMENT salary   by   allowing   100%   increase   towards   the   future  prospects and  (iv)   The   Tribunal   and   the   High   Court   failed   to  ensure payment of just and fair compensation. Reliance was also placed on decisions of this Court  which will be discussed later in this judgment. 14. The   respondents   have   appeared   but   no   counter  affidavit has been filed by them.   Learned counsel for  8 Page 8 the respondents merely justified the award passed by the  Tribunal and affirmed by the High Court.  15. The issues involved in this case are: (i) Whether Provident Fund, Pension and Insurance  receivable by the claimants come within the periphery of  the   Motor   Vehicles   Act   to   be   termed   as   “Pecuniary  Advantage” liable for deduction.  (ii) Whether   the   salary   receivable   by   claimant   on  compassionate appointment comes within the periphery of  the   Motor   Vehicles   Act   to   be   termed   as   “Pecuniary  Advantage” liable for deduction.  (iii) Whether   the   income   tax   is   liable   to   be  deducted   for   determination   of   compensation   under   the  Motor Vehicles Act and (iv)  Whether   the   compensation   awarded   to   the  JUDGMENT appellants is just and proper. 16. For   determination   of   the   aforesaid   issues,   it   is  necessary   to   notice   the   relevant   facts   as   mentioned  hereunder.  17. Smt.   Vimal   Kanwar,   PW­3   (appellant   no.1   herein),  who   is   the   wife   of   the   deceased   has   stated   in   her  examination in chief that her husband obtained BE Degree  from   Jodhpur   University   in   First   Class   and   he   was  directly appointed to the post of Assistant Engineer in  9 Page 9 the year 1994. At the time of accident he was 28 years  old and was getting salary of Rs.9,000/­ per month.  If  he had been alive he would have got promoted upto the  rank of Chief Engineer.   18. Ram   Avtar   Parikh,   PW­2   is   an   employee   of   Public  Works Department, where the deceased was working.   He  stated   that   Sajjan   Singh   was   working   on   the   post   of  Assistant Engineer and at that time his monthly salary  was   Rs.8,920/­.     In   support   of   his     statement   he  produced the Last Pay Certificate and the Service Book  (Exh. 1.) of the deceased.  19. The first issue is “whether Provident Fund, Pension  and  Insurance  receivable  by claimants  come  within  the  periphery   of   the   Motor   Vehicles   Act   to   be   termed   as  “Pecuniary Advantage” liable for deduction.” JUDGMENT The aforesaid  issue fell for consideration  before  this Court in    Helen C. Rebello (Mrs) and others   vs.  Maharashtra   State   Road   Transport   Corporation   &   Anr.  reported in    In the said case, this  (1999) 1 SCC 90.     Court held that  Provident   Fund,   Pension,   Insurance  and   similarly   any   cash,   bank   balance,   shares,   fixed  deposits,   etc.   are   all   a   “pecuniary   advantage”  receivable by the heirs on account of one’s death but  all these have no correlation with the amount receivable  1 Page 10 under a statute occasioned only on account of accidental  death.     Such   an   amount   will   not   come   within   the  periphery   of   the   Motor   Vehicles   Act   to   be   termed   as  “pecuniary   advantage”   liable   for   deduction.     The  following was the observation and finding of this Court:   “35.   Broadly, we may examine the receipt of the  provident fund which is a deferred payment out of  the   contribution   made   by   an   employee   during   the  tenure of his service. Such employee or his heirs  are entitled to receive this amount irrespective of  the   accidental   death.   This   amount   is   secured,   is  certain to be received, while the amount under the  Motor Vehicles Act is uncertain and is receivable  only on the happening of the event, viz., accident,  which may not take place at all. Similarly, family  pension   is   also   earned   by   an   employee   for   the  benefit   of   his   family   in   the   form   of   his  contribution in the service in terms of the service  conditions receivable by the heirs after his death.  The   heirs   receive   family   pension   even   otherwise  than the accidental death. No correlation between  the   two.   Similarly,   life   insurance   policy   is  received either by the insured or the heirs of the  insured   on   account   of   the   contract   with   the  insurer, for which the insured contributes in the  form   of   premium.   It   is   receivable   even   by   the  insured if he lives till maturity after paying all  the   premiums.   In   the   case   of   death,   the   insurer  indemnifies to pay the sum to the heirs, again in  terms of the contract for the premium paid. Again,  this  amount  is receivable  by the claimant  not on  account   of   any   accidental   death   but   otherwise   on  the   insured's   death.   Death   is   only   a   step   or  contingency   in   terms   of   the   contract,   to   receive  the   amount.   Similarly   any   cash,   bank   balance,  shares,   fixed   deposits,   etc.   though   are   all   a  pecuniary   advantage   receivable   by   the   heirs   on  account   of   one's   death   but   all   these   have   no  correlation   with   the   amount   receivable   under   a  statute   occasioned   only   on   account   of   accidental  death.   How   could   such   an   amount   come   within   the  periphery of the Motor Vehicles Act to be termed as  “pecuniary advantage” liable for deduction. When we  seek the principle of loss and gain, it has to be  on a similar and same plane having nexus, inter se,  JUDGMENT 1 Page 11 between them and not to which there is no semblance  of   any   correlation.   The   insured   (deceased)  contributes his own money for which he receives the  amount which has no correlation to the compensation  computed   as   against   the   tortfeasor   for   his  negligence   on   account   of   the   accident.   As  aforesaid,   the   amount   receivable   as   compensation  under the Act is on account of the injury or death  without   making   any   contribution   towards   it,   then  how  can  the  fruits  of an amount  received  through  contributions of the insured be deducted out of the  amount receivable under the Motor Vehicles Act. The  amount   under   this   Act   he   receives   without   any  contribution.   As   we   have   said,   the   compensation  payable under the Motor Vehicles Act is statutory  while   the   amount   receivable   under   the   life  insurance policy is contractual.” 20. The second issue is “whether the salary receivable  by   the   claimant   on   compassionate   appointment   comes  within   the periphery  of the  Motor  Vehicles   Act to be  termed as “Pecuniary Advantage” liable for deduction.”   “Compassionate   appointment”   can   be   one   of   the  conditions   of service  of  an employee,  if a scheme  to  that effect is framed by the employer.   In case, the  JUDGMENT employee dies in harness i.e. while in service leaving  behind the dependents, one of the dependents may request  for compassionate appointment to maintain the family of  the deceased employee dies in harness.   This cannot be  stated   to be an advantage  receivable   by the heirs  on  account of one’s death and have no correlation with the  amount receivable under a statute occasioned on account  of accidental death.  Compassionate appointment may have  1 Page 12 nexus with the death of an employee while in service but  it is not necessary that it should have a correlation  with the accidental death.  An  employee dies in harness  even in normal course, due to illness and to maintain  the family of the deceased one of the dependents may be  entitled for compassionate appointment but that cannot  be termed as “Pecuniary Advantage” that comes under the  periphery of Motor Vehicles Act and any amount received  on   such   appointment   is   not   liable   for   deduction   for  determination of compensation under the Motor Vehicles  Act.   21. The   third   issue   is   “whether   the   income   tax   is  liable to be deducted for determination of compensation  under the Motor Vehicles Act” In the case of    Sarla Verma & Anr.(Supra),     this  JUDGMENT Court held “generally the actual income of the deceased  less   income   tax   should   be   the   starting   point   for  calculating the compensation.   This Court further observed that “where the annual  income is in taxable range,   the word “actual salary”  should be read as “actual salary less tax”.  Therefore,  it is clear that if the annual income comes within the  taxable range income tax is required to be deducted for  determination of the actual salary.  But while deducting  1 Page 13 income­tax from salary, it is necessary to notice the  nature of the income of the victim.   If the victim is  receiving   income   chargeable   under   the   head   “salaries”  one should keep in mind that under Section 192 (1) of  the   Income­tax   Act,   1961   any   person   responsible   for  paying any income chargeable under the head “salaries”  shall   at   the   time   of   payment,   deduct   income­tax   on  estimated income of the employee from   “salaries” for  that financial year.   Such deduction is commonly known  as tax deducted at source (‘TDS’ for short).  When the  employer   fails   in   default   to   deduct   the   TDS   from  employee salary, as it is his duty to deduct the TDS,  then the penalty for non­deduction of TDS is prescribed  under Section 201(1A) of the Income­tax Act, 1961. Therefore, in case the income of the victim is only  JUDGMENT from   “salary”,   the   presumption   would   be   that   the  employer under Section 192 (1) of the Income­tax Act,  1961 has deducted the tax at source from the employee’s  salary.  In case if an objection is raised by any party,  the objector is required to prove by producing evidence  such   as   LPC   to   suggest   that   the   employer   failed   to  deduct the TDS from the salary of the employee.   1 Page 14 However, there can be cases where the victim is not a salaried person i.e. his income is from sources other than salary, and the annual income falls within taxable range, in such cases, if any objection as to deduction of tax is made by a party then the claimant is required to prove that the victim has already paid income tax and no further tax has to be deducted from the income. 22. In   the   present   case,   none   of   the   respondents  brought to the notice of the Court that the income­tax  payable by the deceased Sajjan Singh was not deducted at  source   by   the   employer­   State   Government.       No   such  statement was made by Ram Avtar Parikh, PW­2 an employee  of Public Works Department of the State Government who  placed   on   record   the   Last   Pay   Certificate   and   the  Service Book of the deceased.  The Tribunal or the High  Court on perusal of the Last Pay Certificate, have not  JUDGMENT noticed that the income­tax on the estimated income of  the   employee   was   not   deducted   from   the   salary   of   the  employee during the said month or Financial Year.    In  absence of such evidence, it is presumed that the salary  paid   to   the   deceased   Sajjan   Singh   as   per   Last   Pay  Certificate   was   paid   in   accordance   with   law   i.e.   by  deducting the income­tax on the estimated income of the  deceased Sajjan Singh for that month or the Financial  1 Page 15 Year.     The   appellants   have   specifically   stated   that  Assessment Year applicable in the instant case is 1997­ 98 and not 1996­97 as   held by the High Court.   They  have also taken specific plea that for the Assessment  Year   1997­98   the   rate   of   tax   on   income   more   than  40,000/­   and   upto   Rs.60,000/­   was   15%   and   not   20%   as  held by the High Court.  The aforesaid fact has not been  disputed by the respondents.   23. In view of the finding as recorded above and the  provisions of the Income­tax Act, 1961, as discussed, we  hold that the High Court was wrong in deducting 20% from  the   salary   of   the   deceased   towards   income­tax,   for  calculating   the   compensation.     As   per   law,   the  presumption   will   be   that   employer­State   Government   at  the time of payment of salary deducted income­tax on the  JUDGMENT estimated   income   of   the   deceased   employee   from   the  salary and in absence of any evidence, we hold that the  salary   as   shown   in   the   Last   Pay   Certificate   at  Rs.8,920/­ should be accepted which if rounded off comes  to Rs.9,000/­ for calculating the compensation payable  to the dependent(s).   24. The   fourth   issue   is   “whether   the   compensation  awarded to the appellants is just and proper.” 1 Page 16 For determination of this issue, it is required to  determine   the   percentage   of   increase   in   income   to   be  made towards prospects of advancement in future career  and revision of pay.  In  General Manager, Kerala State  Road Transport Corporation, Trivandrum v. Susamma Thomas  (1994) 2 SCC 176  this Court noticed the age and income  of the deceased for determination of future prospects of  advancement   in   life   and   career.     The   Court   held   as  follows: “   In the present case the deceased was 39 years  19. of age. His income was Rs 1032 per month. Of course,  the   future   prospects   of   advancement   in   life   and  career should also be sounded in terms of money to  augment  the  multiplicand.  While  the  chance  of  the  multiplier is determined by two factors, namely, the  rate of interest appropriate to a stable economy and  the age of the deceased or of the claimant whichever  is higher, the ascertainment of the multiplicand is  a more difficult exercise. Indeed, many factors have  to   be   put   into   the   scales   to   evaluate   the  contingencies   of   the   future.   All   contingencies   of  the   future   need   not   necessarily   be   baneful.   The  deceased   person   in   this   case   had   a   more   or   less  stable job. It will not be inappropriate to take a  reasonably   liberal   view   of   the   prospects   of   the  future and in estimating the gross income it will be  unreasonable to estimate the loss of dependency on  the present actual income of Rs 1032 per month. We  think, having regard to the prospects of advancement  in   the   future   career,   respecting   which   there   is  evidence   on   record,   we   will   not   be   in   error   in  making   a   higher   estimate   of   monthly   income   at   Rs  2000 as the gross income.”  JUDGMENT 25. In    New India Assurance Co.Ltd. v. Gopali & ors.  reported in  AIR 2012 SC 3381  this Court noticed that the  1 Page 17 High Court determined the compensation by granting 100%  increase in the income  of the deceased.   Taking into  consideration the fact that in the normal course, the  deceased would have served for 22 years and during that  period   his   salary   would   have   certainly   doubled,   this  Court, upheld the judgment of the High Court.  26. In   K.R.   Madhusudhan   v.   Administrative   Officer  (2011)   4   SCC   this   Court   observed   that   there   can   be  departure from the rule of thumb and held as under:­ 10.   The  present   case  stands   on  different   factual  basis   where   there   is   clear   and   incontrovertible  evidence   on record  that  the  deceased   was  entitled  and in fact bound to get a raise in income in the  future, a fact which was corroborated by evidence on  record. Thus, we are of the view that the present  case   comes   within   the   “exceptional   circumstances”  and not within the purview of the rule of thumb laid  down   by Sarla  Verma1   judgment.  Hence,  even  though  the deceased was above 50 years of age, he shall be  entitled   to   increase   in   income   due   to   future  prospects.” JUDGMENT 27. Recently   in   Santosh   Devi   v.   National   Insurance  Company Ltd.   reported  in   (2012)  6 SCC 421   this Court  found   it   difficult   to   find   any   rationale   for   the  observation   made   in   paragraph   24   of   the   judgment   in  Sarla Verma’s case and observed as follows: “ 14.   We find it extremely difficult to fathom any  rationale for the observation made in para 24 of the  judgment   in   Sarla   Verma   case2   that   where   the  deceased was self­employed or was on a fixed salary  without   provision   for   annual   increment,   etc.,   the  1 Page 18 courts will usually take only the actual income at  the  time   of death  and  a departure  from  this  rule  should be made only in rare and exceptional cases  involving   special   circumstances.   In   our   view,   it  will   be   naïve   to   say   that   the   wages   or   total  emoluments/income of a person who is self­employed  or   who   is   employed   on   a   fixed   salary   without  provision for annual increment, etc., would remain  the same throughout his life. 15.  The rise in the cost of living affects everyone  across the board. It does not make any distinction  between   rich   and   poor.   As   a   matter   of   fact,   the  effect of rise in prices which directly impacts the  cost of living is minimal on the rich and maximum on  those   who   are   self­employed   or   who   get   fixed  income/emoluments.   They   are   the   worst   affected  people.   Therefore,   they   put   in   extra   efforts   to  generate additional income necessary for sustaining  their families. 18 . Therefore, we do not think that while making the  observations in the last three lines of para 24 of  Sarla  Verma’s  judgment,  the  Court  had  intended  to  lay   down   an   absolute   rule   that   there   will   be   no  addition   in   the   income   of   a   person   who   is   self­ employed   or   who   is   paid   fixed   wages.   Rather,   it  would   be   reasonable   to   say   that   a   person   who   is  self­employed or is engaged on fixed wages will also  get 30% increase in his total income over a period  of   time   and   if   he/she   becomes   the   victim   of   an  accident   then   the   same   formula   deserves   to   be  applied for calculating the amount of compensation.” JUDGMENT 28. In the case of   New India Assurance Co.Ltd.(Supra),  this Court noticed that the High Court determined the  compensation by granting 100% increase in the income of  the deceased.   Taking into consideration the fact that  in the normal course, the deceased would have served for  22 years and during that period his salary would have  1 Page 19 certainly doubled, upheld the judgment of the High Court  with following observation: “ 20. We are also of the view that the High Court  was  justified  in      determining the amount  of   compensation   by   granting     100%     increase  in             the income of the deceased. In the  normal   course,   the     deceased     would       have  served for 22 years and during that period his  salary would  have   certainly doubled because  the employer was paying 20% of his salary as  bonus per year.” 29. Admittedly,   the   date   of   birth   of   deceased   Sajjan  st Singh being 1   February, 1968;  the submission that he  st would have continued in service upto 1  February, 2026,  st if 58 years is the age of retirement or 1   February,  2028, if 60 years is the age of retirement is accepted.  He was only 28 years 7 ½ month old at the time of death.  In   normal   course,   he   would   have   served   the   State  JUDGMENT Government minimum for about 30 years.   Even if we do  not   take   into   consideration   the   future   prospect   of  promotion which the deceased was otherwise entitled and  st the actual pay revisions taken effect from 1   January,  st 1996 and 1  January, 2006, it cannot be denied that the  pay   of   the   deceased   would   have   doubled   if   he   would  continued   in   services   of   the   State   till   the   date   of  retirement.   Hence, this was a fit case in which 100%  increase   in   the   future   income   of   the   deceased   should  2 Page 20 have been allowed by the Tribunal and the High Court,  which they failed to do.   30. Having regard to the facts and evidence on record,  we estimate the monthly income of the deceased Sajjan  Singh at Rs.9,000 x 2 = Rs.18,000/­ per month.   From  rd this his personal living expenses, which should be 1/3 ,  there   being   three   dependents   has   to   be   deducted.  Thereby, the ‘actual salary’ will come to Rs.18,000 –  Rs.6,000/­   =   Rs.12,000/­   per   month   or   Rs.12,000   x   12  =1,44,000/­ per annum.  As the deceased was 28 ½ years  old   at   the   time   of   death   the   multiplier   of   17   is  applied,   which   is   appropriate   to   the   age   of   the  deceased.   The normal compensation would then work out  to be Rs.1,44,000/­ x 17 =Rs.24,48,000/­ to which we add  the usual award for loss of consortium and loss of the  JUDGMENT estate   by   providing   a   conventional   sum   of   Rs.  1,00,000/­; loss of love and affection for the daughter  Rs.2,00,000/­, loss of love and affection for the widow  and the mother at Rs.1,00,000/­ each i.e. Rs.2,00,000/­  and funeral expenses of Rs.25,000/­.   31. Thus,   according   to   us,   in   all   a   sum   of  Rs.29,73,000/­   would   be   a   fair,   just   and   reasonable  award in the circumstances of this case.   2 Page 21 32. The   rate   of   interest   of   12%   is   allowed   from   the  date   of   the   petition   filed   before   the   Tribunal   till  payment is made.   33. Respondent No.3 is directed to pay the total award  with interest minus the amount (if already paid) within  three months.  The appellant No.2­daughter who was aged  about 2 years at the time of accident of the deceased  has already attained majority; money may be required for  her education and marriage.   In the circumstances, we  direct respondent No.3 to deposit 25% of the due amount  in the account of appellant no.1­the wife.  Out of the  rest   75%     of   the   due   amount,   35%   of   the   amount   be  invested in a Nationalized Bank by fixed deposit for a  period of one year in the name of the daughter­appellant  No.2.  Out of the rest 40% of the due amount, 20% each  JUDGMENT be invested in a Nationalized Bank by fixed deposit for  a period of one year in the name of the appellant Nos. 1  and 3, the wife and the mother respectively.  st 34. The award passed by the Tribunal dated 21   June,  th 2003   and   the   judgment   dated   29   July,   2011   of   the  Rajasthan High Court stand modified to the extent above.  The appeal is allowed with the aforesaid observation and  direction.  No separate order as to costs. 2 Page 22 ………..………………………………………..J.        (G.S. SINGHVI) ………………………………………………….J.            (SUDHANSU JYOTI MUKHOPADHAYA) NEW DELHI, MAY 03, 2013. JUDGMENT 2 Page 23