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Punjab-Haryana High Court
Reliance General Insurance Co. … vs Charanjit Kaur And Ors on 17 March, 2021 IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
FAO NO. 7918 OF 2017 and
Cross Objection No. 103-CII of 2018
DATE OF DECISION : 17.03.2021
Reliance General Insurance Company Limited.
…Appellant
Versus
Charanjit Kaur and others
…Respondents
CORAM : HON’BLE MR. JUSTICE ARUN MONGA
Present : Mr. Sanjeev Kodan, Advocate,
for the appellants.
Mr. Sanjeev Patiyal, Advocate
For the respondents.
(Presence marked through video conferencing).
ARUN MONGA, J.
1. The Insurance Company is in appeal impugning the award dated
03.10.2017 rendered by the Motor Accident Claims Tribunal, Mohali (for brevity,
the Tribunal) by virtue of which the appellant(being the insurer) and respondent
No.5(driver) of the offending vehicle bearing registration No. PB7AS-4593 have
been fastened with liability to pay compensation of Rs.25,82,000/- along with
interest @ 6% per annum from the date of filing of the claim petition till
realization on account of death of Jaswinder Singh in a motor vehicular accident
caused on 11.08.2016 due to rash negligent driving of the offending vehicle.
2. The insurance company has challenged the award on the ground that it
has unnecessarily been burdened with the liability to indemnify the claimants that
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too with an exaggerated amount, while the claimants have filed cross objections
No.103-CII of 2018 aggrieved with the compensation amount being on lower side.
3. During the course of arguments, it has been pointed out by learned
counsel for parties that FAO No. 7228 of 2017 arising out of the same accident in
respect of accidental death of Kulbir Singh has been decided by this Court vide
judgment dated 21.12.2020 and the findings returned by the Tribunal that the
accident in question had taken place due to rash and negligent driving of offending
vehicle by respondent No.5, has been upheld. Hence, counsel for the parties are ad
idem that now the only issue to be adjudicated is with respect to quantum of
compensation, so awarded by the Tribunal.
4. I have heard learned counsel for the appellant as well as cross-
objector on the point of quantum of compensation.
5. The first plank of argument raised by learned counsel for the appellant
is that the Tribunal has wrongly relied upon the salary certificate(Ex.PW3/C)
which is not a genuine document and has been procured by the claimants just to
derive undue benefit. According to learned counsel, PW3 Gurpal Singh in whose
firm the deceased was allegedly working, failed to substantiate the factum of
having paid Rs.15,000/- as salary to the deceased as in the income tax returns
produced on record as Ex.PW3/F, Ex.PW3/I and Ex.PW3/J for the years 2014-15,
2015-16 and 2016-17 respectively do not reflect any tax liability on the firm and in
this view of the matter it cannot be believed that the firm engaged the services of
deceased for Rs.15,000/- per month.
6. Apart therefrom, learned counsel for the appellant submitted that the
Tribunal had wrongly added 30% for future prospects. Concededly, the deceased
was 40 years of age at the time of death. In view of the law laid down by the
Constitutional Bench of the Hon’ble Apex Court in case titled as National
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Insurance Company Limited Versus Pranay Sethi and others1, 25% should
have been added for future prospects, where the deceased was between the age
group of 40-50 years. Hence, future prospects awarded by the Tribunal are on
higher side.
7. He further argued that Tribunal had wrongly awarded consortium of
Rs.1,00,000/- to the wife and Rs.25,000/- for funeral expenses, whereas per the
dictum of the Constitution Bench of the Hon’ble Apex Court in National Insurance
Co. Ltd. Vs. Pranay Sethi2, the total compensation under conventional heads has
been restricted to Rs.70,000/-.
8. Learned counsel for the appellant has also questioned the imposition
of penal interest despite at the rate of interest of 9% per annum while relying upon
the ratio laid down in UPSRTC versus Islamuddin3, United India Insurance
Company Versus Bindu4, Fakirappa Versus Karnataka Cement Pipe
Factory5, Sarla Verma Vs. Haryana Roadways6 and Radha Krishna and
another Vs. Gokul & others7, wherein interest at the rate of 6% per annum was
awarded. Thus, according to learned counsel for the appellant, the rate of interest
as awarded in the present case should be 6% rather than 9 % per annum.
9. On the other hand, it was argued by the learned counsel for cross-
objectors/ claimants that income of the deceased has wrongly been taken as
Rs.15,000/- instead of Rs.20,000/- per month and an increase towards future
prospects @ 25% (i.e. Rs.5,000/-) has to be made thereto and after making
deductions of 1/4th to it, the multiplier of 14 has to be applied, taking the total to
Rs.31,50,000/- instead of Rs.24,57,000/-, as awarded by the Tribunal.
1
2017(4) RCR (Civil) 1009
2
2017 ACJ 2700
3
2009(3) SCC-473
4
2009(3) SCC-705
5
2004(2) PLR-210
6
Civil Appeal No. 5256 of 2008 decided on 29.01.2014
7
Civil Appeal No. 9858 of 2013 arising out of SLP(C) No.1056 of 2008 decided on 31.10.2013
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10. According to him, the claimants are entitled to Rs.20,000/- for loss of
estate, Rs.25,000/- as funeral expenses, Rs.40,000/- to claimant No.1 for loss of
spousal consortium, while Rs.40,000/- each to claimants No.2 to 4 for loss of
parental consortium, taking the total amount to be awarded under conventional
heads to Rs.2,05,000/-, in view of law laid down in Magma General Insurance
Company Versus Nanu Ram @ Churu Ram8, instead of Rs.1,25,000/- as
awarded by the Tribunal.
11. As mentioned above, vide judgment dated 21.12.2020 in FAO No.
7228/2017 (&M) title Reliance General Insurance Company Limited v. Rajinder
Kaur and others, arising out of the same accident, this Court upheld the finding of
the learned Tribunal that the accident took place due to rash and negligent driving
of the offending vehicle by Sandeep Kumar respondent No. 5 and learned
counsel for the parties are ad idem that now the only issue to be adjudicated upon
is with regard to the quantum of compensation.
12. Learned Tribunal held that at the time of death, the age of Jaswinder
Singh was about 41 years, his monthly income was Rs. 15,000/-, it added 30% of
the then income for future prospects, deducted 1/4th of the income for his
personal expenses, applied multiplier of 14, awarded consolidated amount of Rs.
1 lakh for loss of consortium and Rs. 25,000/- for funeral expenses and thus
awarded total compensation amount being Rs. 25,82,000/-.
13. Learned counsel for the objector/respondents submits that as per the
categorical testimony of PW Charnjeet Kaur, her husband was earning Rs. 20,000/-
per month, the learned Tribunal wrongly ignored the same while determining
his monthly income as Rs. 15,000/-; it erred in not allowing any compensation for
loss of estate and that the compensation awarded for loss of consortium is
inadequate.
8
SC2018(4) R.C.R.(Civil) 333 : 2018(9) JT 195
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14. On the other hand, learned counsel for the appellant/insurance
company contends that the monthly income of the deceased determined by the
learned Tribunal at Rs. 15,000/- is much too higher than his actual income; the
learned Tribunal also awarded excess compensation for loss of consortium and
for funeral expenses.
15. It was submitted that the salary certificate and the income tax
returns of the employer of Jaswinder Singh deceased are unreliable , but the
learned Tribunal erred by relying upon them while determining his monthly
income as Rs. 15,000/- . He pointed out that in the salary certificate Ex PW3/C
issued by the proprietor of the employer firm, nothing has been mentioned
regarding the heads under which the income of Jaswinder Singh deceased had
been fixed; that the income tax returns for 2014-15, 2015-16 and 016-17 Ex
PW3/F, Ex PW3/I and Ex PW3/J of Rattan Singh proprietor of the employer firm,
shows that the net income was Rs. 5,00,485/- , 4,39,867/- and Rs. 6,76,071/-
respectively and no income tax was paid owing to which it can be safely
presumed that he could not have employed Jaswinder Singh on a monthly salary
of Rs. 15,000/-; that the salary certificate shows that Jaswinder Singh was a
Welding Foreman, but the computation sheet attached with the income tax returns,
show that the business of the firm was ‘trading and retailers’, for which there
could not be any need to employ a welding foreman; that PW-3 Gurpal Singh who
issued the certificate, admitted that his firm was not affiliated to ESI; no labour tax
was deposited with the MC and that the salary certificate Ex PW-3/C does not
bear any date of its issue. For all these reasons, he contended, the document is
totally unreliable and should not have been made the basis for determining the
income of Jaswinder Sigh as Rs. 15,000/- per month.
16. I am of the opinion, that the learned Tribunal rightly determined the
income of Jaswinder Sigh deceased as Rs. 15,000/- per month.
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17. To my mind, the self-serving oral statement of Charanajeet Kaur
claiming her husband’s monthly income as Rs. 20,000/- stood ought-weighed and
displaced by the aforesaid documents submitted by the claimants themselves,
according to which the monthly income of Jaswinder Singh was Rs. 15,000/-.
18. I am also unable to accept the contention of the learned counsel for
the appellant that the salary certificate and supporting income tax returns
produced by the claimants are unreliable and that the learned Tribunal wrongly
made them the basis for holding that monthly income of Jaswinder Singh
deceased was Rs. 15,000/-.
19. Affidavit Ex PW-3A of PW Gurpal Singh shows that he is the
business head of M/s Regency Hadraulic Engineers, Mohali of which his father
Rattan Singh is the proprietor. Salary certificate Ex PW-3/C has been issued on
the letter pad of the said firm. There seems no requirement for specifying the
various heads of salary on suchlike salary certificates. The name of the firm
itself is indicative of the nature of its work/ business. Obviously, there would be
need for employment of a welding foreman for the work/business of the employer
firm. That reality would not be negatived merely because, as contended by the
leaned counsel for the appellant, the computation sheet attached with the income
tax returns, show that the business of the firm was ‘trading and retailers’. The
need for employment of workers depends upon the nature and quantum of
working, turn-over, etc. of the employer. Merely because the net income of the
employer, after accounting for the expenditure for the relevant period, remained
within the exemption limit of income tax liability, that does not mean that the
employer did not employ or could not have employed Jaswinder Singh as welding
foreman on a monthly salary of Rs. 15,000/-. Just because the employer firm was
not affiliated to ESI and no labour tax was deposited with the MC and omission
of date of issue on the salary certificate do not justify an inference that the salary
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certificate is not genuine or that the same should be discarded, in the absence of
any evidence to the contrary.
19. Learned Tribunal held that the age of Jaswinder Singh at the time of
death was about 41 years. It applied the multiplier of 14, relying upon Sarla
Verma v. Delhi Transport Corporation 2009(3)RCR (Civil)77. Correctness of
these findings is not disputed by either side. I am inclined to uphold the same.
20. Considering that the age of Jaswinder Singh at the time of death was
about 41 years, I am of the opinion that as per the norms laid down by the
Constitution Bench in Pranay Sethi and others supra, 25% addition of income
for future prospects should be made, instead of 30% made by the learned Tribunal.
21. Learned Tribunal deducted 1/4th of the income for personal expenses
of the deceased. This has not been questioned by the learned counsel for the
parties. Considering the size of the family and age of the children of the
deceased and other circumstances, I am inclined to agree to the view taken by the
learned Tribunal.
22. In National Insurance Company Limited v. Pranay Sethi and
others supra,a Constitution Bench of the Hon’ble Supreme Court held as
under:
“xxx xxxxx
61 (viii) Reasonable figures on conventional heads, namely, loss of
estate, loss of consortium and funeral expenses should be Rs. 15,000/-
, Rs. 40,000/- and Rs. 15,000/- respectively. The aforesaid amounts
should be enhanced at the rate of 10% in every three years.”
23. Relying upon the same, another bench of the Hon’ble Apex Court in
Magma General Insurance Company v. Nanu Ram @ Churu Ram supra,
awarded compensation of Rs. 50,000/- each, (total Rs. 1,00,000/-) to two
claimants- the father and sister of the deceased victim of the accident- for loss of
filial consortium.
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24. On same analogy and with 10% enhancement over Rs. 40,000/- after
3 years for loss of consortium provided for in Pranay Sethi and others supra, I
am of the opinion that each of the four claimant/objectors namely Charanjit Kaur
widow, Ramanpreet Kaur, Prabhjot Kaur minor daughters and Dharminder Singh
minor son of Jaswinder Singh deceased should get Rs. 44,000/- total Rs.
1,76,000/- for loss of consortium. To my mind, the Learned Tribunal erred in
awarding consolidated amount of Rs. 1,00,000/- for loss of consortium to the
four claimants.
25. I am also of the opinion, that the learned Tribunal erred in not
allowing any compensation at all for loss of estate and that it also erred in
awarding a compensation of Rs. 25,000/- for funeral expenses instead of
allowing the same as per formula laid down by the Constitution Bench in Pranay
Sethi and others supra. As per that norm, Rs. 16500/- instead of Rs. 25,000/-
for funeral expenses and Rs. 16500/- for loss of estate ought to be awarded.
26. In view of the undisputed facts and findings and the discussion as
above, the amount of compensation is worked out and the award of the learned
Tribunal is modified as under:
Sl. No. Head Calculations
(i) Earning of the deceased Rs. 15,000/- per month
(ii) Earnings with 25% Rs. 15,000/-+3,750/-=18,750/-
increase for future
prospects
(iii) Deduct 1/4th for personal 1/4th of 18,750/-= 4688 say
expenses Rs.4690/- =14,060/-
(iv) Compensation with 14,060x12x14=23,62,080/-
multiplier of 14
(v) Loss of consortium @ Rs. Rs.1,76,000/-
44,000/- each to four
claimants
(vi) Funeral expenses Rs. 16,500/-
(vii) Loss of estate Rs. 16,500/-
(viii) Total compensation [(iv)+ 23,62,080/-+ Rs.1,76,000/-+
(v)+ (vi)+ (vii)] Rs. 16,500/-+ Rs. 16,500/-
= Rs. 25,71,080/-.
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27. In Erudhaya v. State Express Transport Corporation Ltd., Civil
Appeal No. 2811-2812 of 2020 decided on 27.07.2020, the Hon’ble Supreme
Court upheld the claim for interest @ 9% of the compensation amount. The
learned Tribunal held the claimants entitled to interest @ 6% per annum on the
amount of compensation from the date of filing the claim petition and directed that
in case the amount was not paid within three months, from the date of the award,
the claimants shall be entitled to interest @ 9% per annum from the date of award
till realization. In view of this, the reliance of the learned counsel for the appellant
on the aforesaid other cases for restricting the rate of interest on the compensation
amount to 6% per annum till payment, is misplaced.
28. As a result, except for the modification that the claimants are entitled
to total compensation of Rs. 25,71,080/- instead of Rs. 25,82,000/-, the award of
the learned Tribunal is upheld. The appeal and the cross objection petition are
disposed of accordingly.
29. Pending applications, if any, also stand disposed of.
March 17, 2021 (ARUN MONGA)
Jiten JUDGE
Whether speaking/reasoned : Yes/No
Whether reportable : Yes/No
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