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2017 Supreme(Del) 2366
IN THE HIGH COURT OF DELHI AT NEW DELHI
R.K. GAUBA, J.
Iffco Tokio General Insurance Co. Ltd. - Appellant
Versus
Ashu Munjal & Ors. - Respondents
MAC. APP. 277 of 2016 & CM APPL. 39043 of 2016
Decided On : 19-07-2017
Advocate Appeared:
For the Appellant : Ms. Suman Bagga, Mr. Pankaj Gupta
For the Respondents: Mr. Pratap Singh Yadav
Calculation of notional income and loss of dependency in motor vehicle accident compensation cases.
Headnote:
Motor Vehicle Accident - Compensation Calculation - Income Tax Return - Loss of Dependency - Non-pecuniary Damages - Funeral Expenses - [MOTOR VEHICLE ACCIDENT] - [Motor Vehicles Act, 1988 - Section 163A] - The court discussed the computation of loss of dependency and non-pecuniary damages in a motor vehicle accident case. It considered the income tax return and last salary drawn by the deceased to calculate the notional income and loss of dependency. The court also referred to previous judgments to determine the non-pecuniary damages and modified the award accordingly.
Fact of the Case:
Yogesh Munjal, a manager, died in a motor vehicle accident. The Motor Accident Claims Tribunal awarded compensation to his family, which the insurance company challenged based on the computation of loss of dependency.
Finding of the Court:
The court found that the last salary drawn by the deceased and the income tax return should be considered to calculate the notional income and loss of dependency. It also acknowledged the inadequacy of non-pecuniary damages and modified the award accordingly.
Issues: Computation of loss of dependency, non-pecuniary damages, and funeral expenses.
Ratio Decidendi: The court considered the last salary drawn and income tax return to calculate notional income and loss of dependency. It also referred to previous judgments to determine non-pecuniary damages.
Final Decision: The court allowed the appeal, modified the award, and ordered the re-calculation of the compensation.
1. Yogesh Munjal, aged 42 years, working as Manager with M/s. Orange Apparels, died as a result of the injuries suffered in a motor vehicular accident that occurred on 21.11.2014 involving rash driving of motor vehicle described as Maruti Car bearing registration No.HR-26-CG-5598 which was admittedly insured against third party risk for the period in question with the appellant insurance company (the insurer), on the accident claim case (Suit No.129/15), taken out in the wake of the Detailed Accident Report (DAR) submitted by the local police pursuant to the investigation into First Information Report (FIR) No.616/2014 of Police Station Fatehpur Beri, on behalf of his wife and two minor sons, they being first to third respondents in this appeal (collectively, the claimants).
2. The Motor Accident Claims Tribunal (the tribunal), after accepting the case of the negligent driving of the above mentioned vehicle to be the cause, awarded compensation computed at Rs.73,11,200/- in favour of claimants and directed the insurance company to pay with interest @ 9% per annum. The said award includes Rs.1 lac each towards loss of love and affection and loss of consortium, Rs.25,000/- towards funeral expenses and Rs.10,000/- towards loss to estate, balance Rs.70,76,200/- being on account of loss of dependency.
3. The insurer questions the computation of loss of dependency on the ground the assumption in para 16 of the award that the income of the deceased was Rs.54,000/- was incorrect. It is pointed out that the income was derived on the basis of income tax return (ITR) for the assessment year (AY) 2012-13, it being in the sum of Rs.3,27,850/-, wrongly assumed by the tribunal to be on account of income from business. It is submitted that the said ITR would show that the income from business was only Rs.75,850/- while salary was Rs.2,52,000/- which, put together, come to Rs.3,27,850/- and, as per the submissions, the said return would indicate the income was Rs.27,320.83 per month. As against this, the tribunal calculated taking the income at Rs.54,000/- which was not supported by any evidence, such assumption being not on the basis of future prospects since that element to the extent of 30% was added later.
4. Per contra, the claimants argued through the counsel that while the non-pecuniary damages awarded by the tribunal are inadequate, the last salary drawn by the deceased is not truly reflected in the ITR for AY 2012-13, in as much as, per the evidence of employer (PW-2), the deceased was earning Rs.33,600/- per month w.e.f. 01.04.2014 (Ex.PW-2/A) which was to get reflected in the ITR in the subsequent period, death having occurred before such ITR for subsequent period could be submitted.
5. It does appear that the figure of Rs.54,000/- indicated in para 16 is without any basis. At the same time, however, it also does appear that the last salary at Rs.33,600/- could not have been ignored. Taking this into account, the last earnings would have to be computed by adding the business income with the last salary drawn. The submission of the insurer that the business income cannot be factored in is not correct because the previous ITR do show such income to be recurrent.
6. The business income in the last ITR filed during the lifetime of the deceased was Rs.75,850/- which comes to Rs.6320/- per month. It is not correct on the part of the insurer to argue that the conveyance allowance, as reflected in the last salary slip, should be kept out. The said allowance would inure to the benefit of the deceased and his dependent family members as it would lead to corresponding savings. Thus, the total last monthly earnings comes to (6320/- + 33,600/-) Rs.39,920/- per month.
7. Having regard to the age of the deceased at the time of occurrence, the future prospects to the extent of 30% are added. Thus, the notional income comes to (39,920/- x 130/100) Rs.51,896/-. The annual notional income would be (51,896/- x 12) Rs.6,22,752/-.
8. The death had occ
