Sunil Sharma& Ors vs Bachitar Singh & Ors

Sunil Sharma & Ors. ...Appellant(s)

VERSUS

Bachitar Singh & Ors. ...Respondent(s)

J U D G M E N T

GANGULY, J.

1. Leave granted.

2. On 2.08.2006, around 4.40 PM, one Mrs. Sunita Sharma (aged 41

years) was returning to Panchkula from Chandigarh on her

scooter, when the offending vehicle (a Tata 407 bearing

registration no. HR-58-5649) driven by the second respondent

hit her and ran over her. She was declared dead when taken to

hospital.

3. Legal heirs of the deceased, her husband and two children,

filed a claim petition before the Motor Accident Claims

Tribunal (MACT) claiming Rs.40,00,000/- as compensation,

along with interest @ 24% p.a.

4. MACT awarded total compensation of Rs.7,92,000/-. It

calculated the same by arriving at gross salary of

Rs.14,541/- (based on salary certificate provided by Haryana

Women Development Corporation Ltd.), the employer of Mrs.

Sunita Sharma. From the same, Rs.1310/- was deducted on

various accounts- she was an income tax assessee, was paid

HRA amounting to Rs.885/-, CCA Rs.200/- and medical allowance

Rs.250/-. MACT concluded that these sums could not be taken

into account in the total salary of Sunita. Thus, her total

carry home salary was taken to be Rs.10,000/- (annual

equivalent being Rs.1,20,000/-). A deduction of 40% was made

for personal expenses, as she was a working woman and was

also maintaining a scooter. Thus, dependency was calculated

at Rs.72,000/-, to which a multiplier of 11 was applied.

Hence, compensation was calculated at Rs.7,92,000/- along

with interest at the rate of 6% p.a.

5. Aggrieved by the award of MACT, the claimants filed an appeal

before the High Court of Punjab and Haryana for enhancement

of compensation. The High Court applied the multiplier of 14,

instead of 11 applied by MACT. The High Court took annual

dependency same as that calculated by MACT, i.e. Rs.72,000.

Accordingly, High Court awarded Rs.2,16,000/- over and above

what was awarded by MACT.

6. Still aggrieved, the claimants filed the present appeal

before this Court. The claimants, appellants in the present

appeal, contended that:

a. MACT should not have deducted HRA, CCA, EPF Group Insurance

Scheme and computer advance from the income of the deceased

and these deductions should not have been upheld by the

High Court.

b. Deduction of 40% for personal expenses, which was upheld by

the High Court, was not correct.

c. MACT and the High Court did not take into consideration the

revision in pay scale of the deceased that came into force

from January 2006 (before her death) while calculating her

income.

d. High Court did not grant any compensation for loss of love

and affection, consortium and expenses towards funeral

rites of the deceased.

7. We have heard the parties and perused the evidence on record,

along with the judgments of the Tribunal and High Court. We

now proceed to deal with each point separately.

a. Computation of Income

8. In the case of National Insurance Co. Ltd. v. Indira

Srivastava & Ors. [AIR 2008 SC 845], S.B. Sinha J, has

observed that "The term 'income' has different connotations

for different purposes. A court of law, having regard to the

change in societal conditions must consider the question not

only having regard to pay packet the employee carries home at

the end of the month but also other perks which are

beneficial to the members of the entire family. Loss caused

to the family on a death of a near and dear one can hardly be

compensated on monitory terms." His Lordship also stated that

if some facilities were being provided whereby the entire

family stood to benefit, the same must be held to be relevant

for the purpose of computation of total income on the basis

of which the amount of compensation payable for the death of

the kith and kin of the applicants was required to be

determined. This Court held that superannuation benefits,

contributions towards gratuity, insurance of medical policy

for self and family and education scholarship were beneficial

to the members of the family. This Court clarified that by

opining that 'just compensation' must be determined having

regard to the facts and circumstances of each case. The basis

for considering the entire pay packet is what the dependents

have lost in view of death of the deceased. It is in the

nature of compensation for future loss towards the family

income" and that "the amounts, therefore, which were required

to be paid to the deceased by his employer by way of perks,

should be included for computation of his monthly income as

that would have been added to his monthly income by way of

contribution to the family as contradistinguished to the ones

which were for his benefit. We may, however, hasten to add

that from the said amount of income, the statutory amount of

tax payable thereupon must be deducted."

9. In Raghuvir Singh Matolya & Ors. v. Hari Singh Malviya &

Ors., [(2009) 15 SCC 363], this Court has observed that

dearness allowance and house rent allowance should be

included for computation of income of the deceased.

10. In the present case, Haryana Women Development Corporation

Ltd. certified that the deceased had drawn her salary for the

month of July, 2006 as under:

Basic Pay -Rs.7,100/-

D.P -Rs.3,550/-

D.A. -Rs.2,556/-

HRA -Rs.885/-

CCA -Rs.200/-

Med. Allowance -Rs.250/-

Gross Total

-Rs.14,541

Deduction

EPF -Rs.780/-

GIS -Rs.30/-

Computer Advance -Rs.500/-

Total Deduction

-Rs.1.310/-

Net Payable= Rs.14,541 - Rs.1,310 = Rs.13,231/-

11. Based on the aforementioned judgments, we are of the view

that deductions made by the Tribunal on account of HRA, CCA

and medical allowance are done on an incorrect basis and

should have been taken into consideration in calculation of

the income of the deceased. Further, deduction towards EPF

and GIS should also not have been made in calculating the

income of the deceased.

12. Thus, we calculate the income of the deceased by taking the

abovementioned allowances into consideration. However, the

computer advance should not form a part of the monthly

income. The monthly income of the deceased thus amounts to

Rs.15,351/-. Thus, the annual income of the deceased would

amount to Rs. 1,84,212/-.

b. Deduction for Personal Expenses

13. The Tribunal deducted 40% from the income of the deceased by

way of personal expenses and the same was upheld by the High

Court. We are of the view that both courts erred in doing the

same in light of the judgment in the case of Sarla Verma

(Smt.) and others v. Delhi Transport Corporation & Anr.,

[(2009) 6 SCC 121], wherein this Court held:

"we are of the view that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependent family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceed six."

14. Hence, we hold that as the deceased was married, a deduction

of 1/3rd should be made to her income by way of personal

expenses. After such deduction, the income of the deceased

would thus amount to Rs.1,22,808/-, which we round off to

Rs.1,22,800/-.

c. Revision in Pay Scale

15. In Sarla Verma (supra), this Court laid down a `rule of

thumb' with respect to addition in income due to future

prospects. This Court observed that the addition should be

only 30% if the age of the deceased was 40 to 50 years.

16. In the present case, the deceased was aged 41 years. Thus, we

allow an addition of 30% by way of future prospects. The

annual income of the deceased would thus be Rs.1,59,640/-.

Considering the age of the deceased, a multiplier of 14 is to

be applied. Accordingly, annual dependency comes to

Rs.22,34,960/-.

d Compensation for Loss of Love and Affection, Consortium, Funeral Rites

17. In cases of fatal motor accidents, some amount must always be

awarded by way of compensation for loss of love and affection

and consortium. It is of course impossible to compensate for

the loss of a life, in the present case, that of a wife and

mother, in terms of money. However, we can make an attempt to

do so. Accordingly we award Rs.25,000/- for loss of love and

affection and consortium.

18. Thus, total compensation payable to the claimants-appellants

is Rs.22,59,960/- which is rounded off to Rs.22,60,000/- with

interest at the rate of 6% from the date of filing the claim

petition.

19. Accordingly the appeal of the claimants-appellants is allowed

to the extent indicated above.

20. The respondents are jointly and severally liable to make the

aforesaid payment, after adjusting payment, if any, is made.

Such payment is to be made within three months. No costs.

.......................J. (G.S. SINGHVI)

.......................J. New Delhi (ASOK KUMAR GANGULY) February 07, 2011