Honble SINHA, J.–Leave granted.

(2). Connotation of the term income for the purpose of determination of just compensation envisaged under Section 168 of the Motor Vehicles Act, 1988 (the Act) calls for question in this appeal which arises out of a judgment and order dated 6-4-2007 passed by the High Court of Judicature at Allahabad, Lucknow Bench at Lucknow in FAFO No.171 of 2001. Respondents husband R.K. Srivastava was employed in a company named Gabriel India Ltd. While he was travelling in an auto rickshaw from Charbagh Railway Station, Lucknow to his residence situated at Ashok Marg, the same met with an accident with a Mahindra Commander Jeep driven rashly and negligently. He sustained injuries and ultimately succumbed thereto. Respondents herein filed a claim petition before the learned Tribunal. A salary certificate was produced in the said proceedings which is in the following terms :

Earnings Amount Deductions Amount

Basic 3420.00 CPF(S) 488.00

Special Pay 70.00 CPF (Add)

FDA 350.00 GIS 3.75

VDA 1040.00 LIC/GIS 509.10

CCA 100.00

HRA 1047.00 MSPI 60.00

Washing All. 75.00 Society 576.00

Conv. 225.00 Union 3.00

Cant.Sub. 265.00 HBA 340.00

C.E.A. 2040.00 B.Fund 10.00

Total 8632.00 Total 1989.85

(3). The learned Tribunal opined that in computing his income, the element of conveyance allowance only would fall outside the purview of income. On the aforementioned basis, the monthly income of the deceased was assessed at Rs.20364/-. Applying the multiplier of 13, as the age of the deceased was 45 years, it was held :

"As such, on using multiple of 13 to the annual income of deceased at Rs.2]32]372/-, the amount works out to Rs.30]20]836/- . The deceased would have spent 1/3rd of this amount on himself, hence on deducting 1/3rd from this amount, 2/3rd compensation amount comes to Rs.20]13]890/-."

It was concluded:

"Considering all these facts, I reach to this finding that the petitioners are entitled to get 2/3rd of the total income of deceased worked out by using multiple of 13 i.e. about Rs.20]00]000/-. Issue No.5 is decided accordingly. It is the liability of opposite party No.3 Insurance Company. On behalf of opposite party No.3, the ruling of Honble High Court Smt. Lalta Devi vs. Suresh & Ors., T.A.C. 8, 1999 (1) page 847 has been filed before me, but this ruling does not extend any specific benefit to opposite party No-3- Hence, while deciding this issue No.5, I come to this conclusion that the petitioners are entitled to get Rs.20]00]000/- (Rs. Twenty Lakhs) as compensation."

(4). The High Court, on an appeal having been preferred both by the appellant as also the respondents, partly allowed the same by a common judgment holding that claimants were entitled to compensation calculated in case of the deceased at Rs.19]53]224/- along with interest @ 9% from the date of presentation of the claim petition till its realization, holding that travelling reimbursement could not be taken into consideration for computation of net income of the deceased.

(5). Appellant is, thus, before us. Keeping in view the importance of the question involved and furthermore in view of the fact that the first respondent was appearing-in- person, we had requested Mr. L.N. Rao, learned senior counsel, to assist us in the matter.

(6). Submission of Mr. Satija, learned counsel appearing on behalf of the appellant, is that for the purpose of computation of the amount of compensation what was material is the basic pay and not other allowances and, in that view of the matter, the High Court has committed a serious error in opining otherwise. The learned counsel contended that emphasis by this Court are being laid on computation of damages based on net income and not gross income. It was also contended that in any event the amount of compensation awarded by the High Court is on higher side.

(7). Mr. Rao, however, submitted that apart from the basic salary, contributions made by the employee should also be taken into consideration for calculation of the amount

Click Here to Read the rest of this document