SANGITA ARYA vs. ORIENTAL INSURANCE COMPANY LIMITED

NON­REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.  2612    OF 2020 (Arising out of SLP (Civil) No. 28724 of 2018) Smt. Sangita Arya & Ors.      … Appellants versus Oriental Insurance Co. Ltd. & Ors.             … Respondents J U D G M E N T INDU MALHOTRA, J. Leave granted. 1.     The   present   civil   appeal   has   been   filed   by   the Claimants/Dependents of one Harish Singh Arya, who died at   the   age   of   35   years   in   a   motor   vehicle   accident   on 18.06.2007. 2.     On 18.06.2007, the deceased Harish Singh Arya had taken his   uncle   Govind   Lal   Arya,   an   Enforcement   Officer   for Passenger Tax, Champawat for inspection in his taxi. The Signature Not Verified taxi had stopped on the side of the road at Village Chandini Digitally signed by MAHABIR SINGH Date: 2020.06.16 17:06:00 IST Reason: near Tanakpur – Khatema Road, Uttarakhand. The deceased 1 had gone to answer nature’s call on the side of the road, when at about 2:30 p.m., one Tata Sumo bearing No. UP­ 02D­5208, being driven at a high speed from the wrong side of the road, hit the deceased, and seriously injured him. The Enforcement Team was able to stop the offending vehicle, however the driver of the vehicle fled from the spot. While Harish   Singh   Arya   was   being   taken   to   Bareilly   for hospitalization, he succumbed to his injuries. The F.I.R. of the accident was lodged by Mr. Govind Lal Arya, the uncle of the deceased, at P.S. Banbasa.  3.        The Claimants filed a Claim Petition before the Motor Accident  Claims  Tribunal,  Haldwani –  Court  of  First  Fast Track, Additional District Judge, Haldwani, District Nainital (MACT)   being   Compensation   Claim   No.   158   of   2007   for compensation on behalf of five dependents i.e. the widow, two minor daughters, and the parents of the deceased. The Claimants submitted that the deceased owned two taxis from which he earned approximately Rs. 1,00,000 p.a. after deduction of all expenses. The road accident was proved by the oral testimony of the   eye­witness   Shri   Govind   Lal   Arya   (PW­2),   who   was accompanying the deceased, and had lodged the F.I.R. 2 With respect to payment of compensation, the Claimants submitted   that   the   deceased   owned   two   taxis,   which generated an income of Rs. 1,00,000 p.a. The R.T.O., Motor Vehicles Department, Haldwani produced certificates of both the   vehicles   bearing   No.   UP­02D­5111   and   UP­04D­0111 before   the   MACT,   which   showed   that   the   vehicles   were purchased   by   the   deceased   Harish   Singh   Arya,   and   were registered in his name. The Claimants filed four Income Tax Returns (ITRs) of the deceased for the years 2002­03, 2003­04, 2004­05, and 2006­07. The ITR for the year 2006­07 was Rs. 98,500 p.a. A photocopy of the ITR bearing the stamp of receipt from the Income Tax Department, was placed on record. 4.       The MACT  vide  Award dated 22.12.2009 held that on the date of the accident, the deceased was 35 years of age, and his   income   was   Rs.   1,00,000   p.a.   The   deceased   had   left behind five dependents i.e. his wife, parents and two minor th daughters. The MACT deducted 1/4  of his income towards personal   expenses,   and   adopted   the   multiplier   of   16. Accordingly, the loss of dependency was computed at Rs. 12,20,000. 3 The   MACT   further   awarded   Rs.   20,000   to   the   widow towards   loss   of   consortium,   Rs.   10,000   to   the   minor daughters towards loss of love and affection, and Rs. 5,000 towards funeral expenses. The total compensation awarded to the Claimants worked out to Rs. 12,55,000 with Interest @6% p.a. The Respondent No. 1 – Insurance Company was held liable for payment of compensation to the Claimants. 5.     Aggrieved by the aforesaid Award, the Insurance Company filed Appeal from Order No. 117 of 2010 before the  High Court of Uttarakhand at Nainital. The   learned   Single   Judge   of   the   High   Court   vide   the impugned judgment dated 22.07.2016 erroneously assumed that the deceased was a Government servant, and observed that   he   was   running   a   parallel   business   by   plying   taxis. There   is   no   basis   for   finding   that   the   deceased   was   a Government employee. We do not know as to on what basis the   learned   Single   Judge   has   arrived   at   this   factually incorrect   conclusion,   and   made   it   the   basis   for   awarding compensation. The High Court further held that the ITRs for the years 2002­03,   2003­04   and   2004­05   showed   that   the   average 4 income of the deceased for these three years was Rs. 52,635 p.a. The ITR for the year 2006­07 revealed an income of Rs. 98,500   p.a.,   which   was   almost   double   the   income   of   the preceding three years. The High Court held that the ITR for the year 2006­07 could not be taken into consideration. The learned Single Judge further held that the income which may have been generated from the two taxis, could not be taken into consideration for determining the income of the deceased. Accordingly, the High Court took the average of the ITRs   for   years   2002­03,   2003­04   and   2004­05,   for determining the income of the deceased at Rs. 52,635 p.a. rd The Court deducted 1/3   of the income towards personal expenses,   and   applied   the   multiplier   of   16.   The   loss   of dependency was assessed at Rs. 5,61,440. The consortium payable to the widow was reduced by the High Court from Rs. 20,000 (as awarded by the MACT) to Rs. 10,000;   the   amount   awarded   towards   loss   of   love   and affection   to   the   minor   daughters   was   reduced   from   Rs. 10,000   to   Rs.   5,000.   However,   the   amount   of   Rs.   5,000 awarded   by   the   MACT   towards   funeral   expenses   was maintained. 5 The total compensation awarded to the Claimants was reduced from Rs. 12,55,000 to Rs. 5,81,440. 6.        Aggrieved by the impugned judgment dated 22.07.2016 passed   by   the   High   Court,   the   Claimants   have   filed   the present civil appeal. This Court while issuing notice to the Respondents on 23.10.2018, recorded the submission made on behalf of the Claimants   that   the   deceased   was   not   a   Government employee. 7.        We have heard the learned counsel for the parties and perused the material on record. We find that the impugned order passed by the High Court bristles with serious factual inaccuracies   :–   first,   the   learned   Single   Judge   wrongly assumed   that   the   deceased   Harish   Singh   Arya   was   a Government employee. This has nowhere been averred by the Claimants in any of their pleadings. The entire basis of the judgment is hence misconceived. On the basis of the aforesaid erroneous assumption, the High Court has erroneously observed that the deceased was running a parallel business by plying two taxis, and held that the income derived from the same could not be taken into consideration for assessing the compensation. These findings 6 being based on a completely erroneous assumption, are liable to be set aside. Second, the High Court determined the income of the deceased by taking the average of the ITRs filed for the years 2002­03 at Rs. 54,000 p.a., 2003­04 at Rs. 52,405 p.a., and 2004­05   at   Rs.   51,500   p.a.   The   learned   Single   Judge disregarded the ITR for the year 2006­07, wherein the income of the deceased was shown as Rs. 98,500 p.a. on the ground that it was allegedly filed almost one year after the death of the deceased. This finding also is factually incorrect. A photocopy of the original ITR for the year 2006­07 was filed   before   this   Court,   bearing   the   rubber   stamp   of   the Income Tax Department. It shows that the date of filing the ITR   was   20.04.2007,   which   is   prior   to   the   death   of   the deceased which occurred on 18.06.2007. Hence, the High Court was not justified in disregarding the ITR for the year 2006­07 while assessing the income of the deceased. The Appellants have also placed on record a copy of the ITR for the year 2005­06, which bears the rubber stamp of the Income Tax Department, and reveals the income of the deceased at Rs. 98,100 p.a. during the previous assessment year. 7 As   a   consequence,   the   impugned   judgment   dated 22.07.2016 passed by the High Court is hereby set aside. 8.       On a perusal of the documentary evidence on record i.e. the ITRs for the assessment years 2005­06 and 2006­07, filed prior to the death of the deceased, which reflect the income of approximately Rs. 1,00,000 p.a. (as assessed by the MACT in its Award dated 22.12.2009), we make this the basis   for   computing   the   compensation   payable   to   the Claimants. We find that the Courts below have not awarded any amount   towards   future   prospects,   as   mandated   by   the judgment of the Constitution Bench in   National Insurance 1 Company Limited   v.   Pranay Sethi &  Ors.   Accordingly,   we award future prospects @40% of the income of the deceased. Given   the   fact   that   the   deceased   left   behind   five dependents,   the   deduction   towards   his   personal   expenses th would be 1/4   as per the judgment of this Court in   Sarla 2 Verma & Ors.  v.  Delhi Transport Corporation & Anr. The multiplier adopted by the MACT and the High Court at 16 is appropriate. 1  (2017) 16 SCC 680. 2  (2009) 6 SCC 121. 8 With   respect   to   payment   of   compensation   under   the conventional   heads,   we   direct   that   same   be   awarded   in consonance with the judgment in  Pranay Sethi (supra). Accordingly,   the   compensation   payable   to   the Claimants/Appellants herein is determined as :

9.       Even though the Claimants/Appellants herein did not file an Appeal against the Award dated 22.12.2009 passed by the MACT   before   the   High   Court,   we   deem   it   appropriate   to enhance   the   compensation   by   exercising   our   jurisdiction under Article 142 of the Constitution of India in order to do complete justice between the parties. 10.       The Respondent – Insurance Company is directed to pay the compensation awarded to the Appellants within a period of   twelve   weeks’   from   the   date   of   this   judgment,   after adjusting   any   amount   which   may   have   been   paid.   The 9 amount payable to the Appellants shall carry Interest @ 7.5% p.a. from the date of filing the claim petition till the date of realization. 11. The Civil Appeal is allowed in the aforesaid terms. All pending Applications, if any, are accordingly disposed of. Ordered accordingly. ...…...............………………J. (R. BANUMATHI) ...…...............………………J. (INDU MALHOTRA) ...…...............………………J. (ANIRUDDHA BOSE) June16, 2020; New Delhi. 10