High Court of KeralaSingle JudgeAppeal allowed; compensation modified to Rs.76,...
United India Insurance Company Limited v. A.K. John and others
Case / Petition Number:MACA NO. 2180 OF 2016
Case Details & Bench
- Court
- High Court of Kerala
- Hon'ble Judges
- Murali Purushothaman
- Judgment Date
- 2021-12-13
- Court Decision / Holding
- Appeal allowed. The Tribunal’s award is recalibrated: the monthly income on the date of death is Rs.58,334; 50% is added for future prospects (Pranay Sethi); 50% is deducted for personal and living expenses (Sarla Verma) for a bachelor; resulting monthly figure Rs.34,881. With a multiplier of 18, the loss of dependency is Rs.75,34,296. After statutory adjustments and heads (funeral, loss of estate, etc.), the total comes to Rs.76,86,296. The Tribunal’s award is replaced with Rs.76,86,296, with interest at 9% per annum and proportionate costs. The insurer’s deposit/escrow obligations and disbursement order previously directed by this Court remain in force according to the modified award.
- Final Disposition
- Appeal allowed; compensation modified to Rs.76,86,296 with 9% interest and costs; order for deposit/disbursement as modified by the Court.
Parties to the Case
Appellants / Petitioners
- United India Insurance Company Limited
Respondents
- A.K. John
- Rosamma John
- Rincy John
Legal Representation & Advocates
Counsels for Petitioners
- • Sri Mathews Jacob (Sr.)
- • Sri P. Jacob Mathew
- • Smt. Preethi R. Nair
Counsels for Respondents
- • Sri M. Sreekumar
Case Synopsis & Summary
This High Court of Kerala hears MACA No. 2180 of 2016, an appeal by United India Insurance Company Limited challenging an MACT-IV Thiruvananthapuram award in O.P.(MV) 433/2008 for the death of Ricky John, a 24-year-old Accounts Manager at WIPRO Infotech in Bangalore. The tribunal held the BMTC bus driver negligent and awarded Rs 88,81,000 in total compensation under heads including loss of dependency, funeral expenses, loss of estate, medical expenses, and pain and suffering, with 9% interest per annum and costs. The insurer contends that the petitioners overstated the deceased’s income and that the tribunal erred in calculating future prospects and deductions; it challenges the income on the date of death and argues for Rs.58,334 per month as the actual earnings, with deductions for professional tax and income tax. The appellant relies on Pranay Sethi and other precedents to justify a revised computation, while the respondents argue for adherence to the factual record and established legal principles. The High Court re-evaluates the income, applying precedent on future prospects and deductions for personal living expenses and taxes. It determines the income on the date of death as Rs.58,334, adds 50% for future prospects, deducts 50% for living expenses (bachelor), and applies a multiplier of 18 to arrive at Rs.75,34,296 for loss of dependency. After adjustments for funeral, love and affection, and estate, the total comes to Rs.76,86,296. The appeal is allowed; the Tribunal’s award is reduced accordingly to Rs.76,86,296 with 9% interest and costs, and a deposit/order of payment is directed as specified in the judgment.
Provisions of Law Cited
Section 168, Motor Vehicles Act, 1988
Legal Doctrines & Maxims
- 50% addition for future prospects (Pranay Sethi v. National Insurance Co. Ltd., 2017)
- 50% deduction for personal and living expenses for bachelors (Sarla Verma v. Delhi Transport Corporation, 2009)
- Tax deduction from salary (Kalpanaraj and others v. Tamil Nadu State Transport Corporation, 2015)
- Funeral expenses and loss of love/affection - guidance in Satinder Kaur cases (Satinder Kaur v. United India Insurance Co. Ltd., AIR 2020 SC 3076)
Submissions & Arguments
Contentions of Appellants / Petitioners
The insurer contends that the MACT award improperly used Rs.67,084 per month as income after 3 months, whereas on the date of death the actual monthly salary was Rs.58,334. It seeks deduction of Rs.200 as professional tax and tax deductions (20%), challenges the large multipliers and the application of future prospects, and relies on Pranay Sethi and related precedents to reform the computation.
Contentions of Respondents
The petitioners contend that the tribunal correctly calculated compensation based on the evidence of the deceased's income and age, and that the Court should follow the established heads of compensation, including loss of dependency and other heads, with the appropriate multipliers and deductions as guided by prior jurisprudence.
Cited Precedents (4)
| Case Name | Citation | Treatment | Explanation |
|---|---|---|---|
| Pranay Sethi v. National Insurance Co. Ltd. | 2017 (16) SCC 680 | Positive | Constitution Bench held that income for compensation must include future prospects; adds 50% for those with permanent jobs and under 40. |
| Kalpanaraj and others v. Tamil Nadu State Transport Corporation | (2015) 2 SCC 764 | Positive | Tax deductions from salary (professional tax and income tax) are to be considered when determining monthly income. |
| Sarla Verma v. Delhi Transport Corporation | (2009) 6 SCC 121 | Positive | 50% deduction for personal and living expenses for a bachelor when computing dependency loss. |
| Satinder Kaur v. United India Insurance Co. Ltd. | AIR 2020 SC 3076 | Positive | Guidance on heads of compensation; affects awards for funeral expenses and love-and-affection/loss of consortium. |
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Extracted Judgment Text
Exact text extracted from official judgment records.
# **IN THE HIGH COURT OF KERALA AT ERNAKULAM**
**PRESENT**
**THE HONOURABLE MR.JUSTICE MURALI PURUSHOTHAMAN MONDAY, THE 13[TH] DAY OF DECEMBER 2021 / 22ND AGRAHAYANA, 1943**
**MACA NO. 2180 OF 2016**
**AGAINST THE AWARD DATED 16.03.2016 IN OPMV 433/2008 OF ADDITIONAL MOTOR ACCIDENTS CLAIMS TRIBUNAL-IV, THIRUVANANTHAPURAM**
## **APPELLANT/2ND RESPONDENT:**
**UNITED INDIA INSURANCE COMPANY LIMITED BANGALORE, NOW REPRESENTED BY ITS BRANCH MANAGER, REGIONAL OFFICE,"SHARANYA", HOSPITAL ROAD, KOCHI-11.**
**BY ADVS. SRI.MATHEWS JACOB (SR.) SRI.P.JACOB MATHEW SMT.PREETHY R. NAIR**
## **RESPONDENT/S:**
**1 A.K.JOHN, S/O KURIAN, HOUSE NO.18, JAYAREKHA, TC 3/2314,CHITHRA NAGAR, PATTOM P.O.,THIRUVANANTHAPURAM -695 004. 2 ROSAMMA JOHN WO.A.K.JOHN HOUSE NO.18, JAYAREKHA, TC 3/2314, CHITHRA NAGAR, PATTOM P.O., THIRUVANANTHAPURAM -695 004.**
**3 RINCY JOHN D/O.A.K.JOHN HOUSE NO.18, JAYAREKHA, TC 3/2314, CHITHRA NAGAR, PATTOM P.O., THIRUVANANTHAPURAM -695 004.**
## **R1 TO R3 BY ADV SRI.M.SREEKUMAR**
**THIS MOTOR ACCIDENT CLAIMS APPEAL HAVING BEEN FINALLY HEARD**
**ON 13.12.2021, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING:**
**MACA NO. 2180 OF 2016 ..2..**
## **JUDGMENT**
This appeal is filed by the Insurance Company challenging the compensation awarded by the Additional Motor Accidents Claims Tribunal -IV, Thiruvananthapuram in O.P.(MV) No.433 of 2008. The respondents in this appeal were the petitioners in the claim petition, who are the parents and sister of deceased Ricky John. The parties in this appeal are referred to as per the status in the claim petition.
2. The case of the petitioners is that on 05/06/2007 at about 8.45 p.m, while the deceased was walking through Sarjapura main road near Agrara Circle, Bangalore, a BMTC bus bearing registration No. KA-01/F-1706 driven by the 3[rd] respondent came in a rash and negligent manner and hit the deceased. Even though he was rushed to the hospital, he succumbed to the injuries. The deceased was
**MACA NO. 2180 OF 2016 ..3..**
aged 24 and was working as an Accounts Manager in WIPRO Infotech, earning Rs. 58,334/- per month. The 1[st] respondent is the owner of the bus bearing registration No. KA-01/F-1706 and the 2[nd] respondent is its insurer. The petitioners claimed an amount of Rs. 92,00,424/- as compensation for the death of Sri. Ricky John, which was limited to Rs.90,00,000/-.
3. Respondents 1 and 3 were set ex-parte. The 2[nd] respondent insurer filed written statement admitting that the vehicle had a valid insurance policy at the time of the accident; but, disputed the age, occupation and income of the deceased. It was further contended by the insurer that the accident happened due to the negligence of the deceased and the claim made by the petitioners under various heads is excessive and exorbitant.
4. On the side of the petitioners, no oral evidence was
adduced; but Exts. A1 to A13 documents were marked. On
**MACA NO. 2180 OF 2016 ..4..**
the side of the 2[nd] respondent, no evidence was adduced.
5. The Tribunal found that the accident happened due to the negligence of the 3[rd] respondent driver. The Tribunal awarded an amount of Rs.88,81,000/- as total compensation with 9% interest per annum and proportionate costs. The insurer was directed to satisfy the award. Compensation was awarded under various heads as
follows:
|**Sl.**<br>**No**|**Head of Claim**|**Amount claimed**|**Amount awarded**|
|---|---|---|---|
|1|Transport to<br>hospital|Rs. 2,000/-|Rs. 1,000/-|
|2|Damage to<br>clothing and other<br>articles|Rs. 3,000/-|Rs. 1,000/-|
|3|Medical expenses|Rs. 25,000/-|Nil|
|4|Funeral expenses|Rs. 10,000/-|Rs. 25,000/-|
|5|Pain and<br>suferings|Rs. 10,000/-|Rs. 10,000/-|
|6|Loss of|Rs. 91,23,424/-|Rs. 86,94,000/-|
**MACA NO. 2180 OF 2016 ..5..**
||dependency|||
|---|---|---|---|
|7|Loss of love and<br>afection|Rs. 25,000/-|Rs. 1 lakh|
|8|Loss of estate|Rs. 2,000/-|Rs. 50,000/-|
||**Total**|**Rs. 92,00,424/-**|**Rs. 88,81,000/-**|
6. According to the Appellant insurer, the amounts awarded under various heads are excessive and without any basis. The main dispute is regarding the income of the deceased taken by the Tribunal for assessing the compensation. The petitioners have claimed that the deceased was an Accounts Manager in WIPRO Infotech, Bangalore, earning Rs. 58,334/- per month. It is stated in the claim petition that the salary stack applicable after 3 months from the date of joining is Rs.67,084/. In order to the educational and prove qualifications, occupation income of the deceased, the petitioners have produced Exts.A8 to A13 documents. Ext. A8 is the Secondary School
**MACA NO. 2180 OF 2016 ..6..**
Examination Certificate, Ext. A9 is the degree certificate (B tech – Mechanical) and Ext.A10 is the mark list of the deceased in P.G. Programme in International Business. Ext.A11 is the appointment order and Ext.A12 is the salary certificate of the deceased issued by his employer WIPRO Infotech. Ext.A13 is the statement of benefits for a period of 18 days issued by the employer. The Tribunal took the monthly income of the deceased as Rs.67,083/- for assessing the compensation.
7. Ext.A11 appointment order dated 03.05.2007 shows
the gross monthly salary stack applicable for the first 3 months from the date of joining as Rs.58,334/- and the salary stack applicable after 3 months from the date of joining as Rs.67,084/-. Unfortunately, the deceased could work only for 18 days after he got appointment as Accounts Manager in WIPRO Infotech. Therefore, the income of the deceased as on the date of the accident has
**MACA NO. 2180 OF 2016 ..7..**
to be taken as Rs.58,334/- per month and not Rs.67,084/as taken by the Tribunal. In Ext.A13 statement of benefits for the period of 18 days the deceased worked in WIPRO Infotech, Ranchi, the employer has assessed the benefits taking in the account the salary stack as applicable for the first 3 months from the date of joining. Ext.P12 salary certificate dated 02-02-2016 issued by the employer shows the monthly gross salary of the deceased as Rs.67,084/and the designation is shown as 'Senior Executive-Client Solutions'. Probably this certificate reflects the salary of the deceased which he would have drawn 3 months after **National Insurance Co. Ltd.** _**v**_ **.** the date of joining. In **Pranay Sethi [2017 (16) SCC 680]** , the Constitution Bench of the Hon'ble Supreme Court observed that, determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as
**MACA NO. 2180 OF 2016 ..8..**
postulated under S.168 of the M.V.Act. The Court held that while determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. It was also held that actual salary should be, actual salary less tax. It is taking into consideration the status of the employee, his educational qualification, potentiality to earn and all other aspects an addition of 50% of actual salary to the income of the deceased is fixed while computing future prospects. Therefore, the Tribunal went wrong in taking the salary of the deceased which he would have drawn after 3 months after the date of joining as the income of the deceased and adding 50% to that income towards future prospects. Going by Exts.A11 and A13, the income of the deceased as on the date of the accident has to be taken as Rs.58,334/per month. As per the decision of the Hon'ble Supreme
**MACA NO. 2180 OF 2016 ..9..**
Court in **Kalpanaraj and others** _**v**_ **. Tamil Nadu State Transport Corporation [(2015) 2 SCC 764]** , income tax and professional tax has to be deducted from the salary of the deceased while determining the monthly income. The deceased had paid Rs.200/- as professional tax as per the slab applicable in State of Karnataka. This amount has to be deducted from the monthly salary of Rs.58,334/-. The monthly salary after deduction of professional tax will come to Rs.58,134/.The Tribunal has deducted 20% from the income towards income tax as per the income tax rates applicable for the concerned financial year. Therefore, the actual salary of the deceased is re-fixed as **Rs.46,508/-** .
8. The deceased was aged 24 years at the time of death. As held in **Pranay Sethi** (supra), an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made.
**MACA NO. 2180 OF 2016 ..10..**
Therefore, the income of the deceased adding 50% towards - future prospects would come to **Rs.69,762/** (Rs.46,508+23,254).
9. The deceased was a bachelor and he left behind his parents and an unmarried sister. As per the decision of the Hon'ble Supreme Court in **Sarla Verma** _**v**_ **. Delhi Transport Corporation [(2009)(6) SCC 121]** , 50% of the monthly income has to be deducted towards the personal and living expenses in case of bachelors. Therefore, after deduction of 50% towards the personal and living expenses, the income of the deceased would come to **Rs.34,881/-** .
10. Since the deceased was aged 24 years at the time of death, the Tribunal has rightly taken the multiplier as '18'. Therefore, under the head of loss of dependency, the petitioners are entitled only for an amount of **Rs.75,34,296/-** (34,881×12×18) as against Rs.88,81,000/-
**MACA NO. 2180 OF 2016 ..11..**
awarded by the Tribunal. An amount of **Rs.13,46,704/-** (Rs.88,81,000- Rs.75,34,296) is therefore to be deducted from the compensation awarded under the head of loss of dependency.
11. The claim for medical expenses was rejected by the Tribunal for want of evidence. It is seen from records that the deceased succumbed to injuries on way to hospital. In the absence of evidence, I am not interfering with the findings of the Tribunal under the said head.
12. The Tribunal has awarded an amount of Rs.10,000/- towards pain and sufferings. The petitioners are not entitled for any amount under the said head in the light of the decision in **United India Insurance Co.Ltd.** _**v**_ **Satinder Kaur [AIR 2020 SC 3076]** . So the amount of **Rs.10,000/-** awarded under the said head is to be deducted from the total compensation arrived at.
**MACA NO. 2180 OF 2016 ..12..**
13. For compensation under the head funeral expenses, Rs.25,000/- has been awarded. As per the decision in **United India Insurance Co.Ltd.** _**v**_ **Satinder Kaur** (supra) the petitioners are entitled to only Rs.15,000/- under the head funeral expenses. Therefore, an amount of **Rs. 10,000/-** has to be deducted from the total compensation.
14. The petitioners were granted Rs.1,00,000/towards loss of love and affection. The petitioners are entitled to Rs.1,20,000/- (Rs. 40,000/ each) towards loss of consortium. The Hon'ble Supreme Court has held in **United India Insurance Co.Ltd.** _**v**_ **Satinder Kaur** (supra), that when compensation is awarded under the head loss of consortium, there is no justification in awarding compensation for loss of love and affection as a separate head. Therefore, since **Rs.1,20,000/-** is awarded under the head loss of consortium, the petitioners are not
**MACA NO. 2180 OF 2016 ..13..**
entitled for any amount under the head loss of love and affection.
15. Towards loss of estate, an amount of Rs. 50,000/has been awarded by the Tribunal. In the light of the decision in **United India Insurance Co.Ltd.** _**v**_ **Satinder Kaur** (supra), the petitioners are entitled only for an amount of Rs.15,000/- towards loss of estate. Therefore, **Rs.35,000/-** has to be deducted from the compensation awarded under the said head.
16. Thus, on a re-appreciation of the pleadings and materials on record and the law laid down in the aforecited decisions, I hold that the compensation awarded by the Tribunal in the impugned award is on the higher side and has to be modified and reduced as held above and given in the table below for easy reference.
**MACA NO. 2180 OF 2016 ..14..**
|Sl.<br>No|Head of Claim|Amount awarded<br>by Tribunal|Amount<br>modifed and<br>recalculated by<br>this Court|
|---|---|---|---|
|1|Transport to hospital|Rs. 1,000/-|Rs. 1,000/-|
|2|Damage to clothing<br>and other articles|Rs. 1,000/-|Rs. 1,000/-|
|3|Medical expenses|Nil|-|
|4|Funeral expenses|Rs. 25,000/-|Rs.15,000/-|
|5|Pain and suferings|Rs. 10,000/-|-|
|6|Loss of dependency|Rs. 86,94,000/-|Rs.75,34,296|
|7|Loss of love and<br>afection (modifed as<br>loss of consortium by<br>this Court)|Rs. 1,00,000/-|Rs.1,20,000/-|
|8|Loss of estate|Rs. 50,000/-|Rs.15,000/-|
||**Total**|**Rs. 88,81,000/-**|**Rs.76,86,296/-**|
17. In the result, the appeal is allowed holding that the respondents/petitioners are entitled only for an amount of **Rs.76,86,296/-** instead of Rs.88,81,000/- awarded by
**MACA NO. 2180 OF 2016 ..15..**
the Tribunal with 9% interest per annum and proportionate costs.
18. There is already an order dated 01.08.2016 passed by this Court directing the appellant/2[nd] respondent insurer to deposit before the Tribunal 50% of the amount awarded by the Tribunal and to disburse Rs.2,00,000/- each to petitioners 1 and 2 and Rs.1,00,000/- to the 3[rd] petitioner and the balance amount to be kept in fixed deposit in a Nationalised Bank in the joint names of the petitioners 1 and 2 for a period of three years, subject to further orders to be passed by this Court. The appellant/2[nd] respondent shall deposit the balance amount as modified by this Court with interest and proportionate costs before the Tribunal within a period of two months from the date of receipt of a certified copy of this judgment. The Tribunal shall disburse the compensation amount so deposited including the amount in deposit in the Nationalised Bank to the
**MACA NO. 2180 OF 2016 ..16..**
respondents/petitioners in the same proportion as directed by the Tribunal and in accordance with law.
Sd/-
**MURALI PURUSHOTHAMAN JUDGE**
SB