# Smt. Jyoti & Ors v. Neha Khatri & Ors

- **Citation:** (2026) 1 ILRA 1310
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2026-01-12
- **Case number:** First Appeal From Order No. 3821 of 2011
- **Bench:** Sandeep Jain
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/smt-jyoti-ors-v-neha-khatri-ors-54016
- **Pages:** 12

## Text

1310 INDIAN LAW REPORTS ALLAHABAD SERIES
5.
Add future prospects @ 20% since deceased was
aged about 73 years
43,085/-
Rule 220-A of UP Motor Vehicle
Rules,1998
6.
Total annual dependency of claimants on deceased

2,58,509/-
Rule 220-A of UP Motor Vehicle
Rules,1998
7.
Multiplier applied since age of deceased was
about 73 years
5
Second Schedule of the Act
8.
Total loss of dependency to the claimants
2,58,509X5=12,92,545/-
Second Schedule of the Act
9.
Loss of consortium @Rs.40,000/- each
(5 claimants)
40,000X5=2,00,000/-
Pranay Sethi (supra), Magma General
Insurance Co. Ltd. (supra) and Rahul
Ganpatrao Sable (supra)
10.
Loss of estate
15,000/-
As awarded by the tribunal
11.
Funeral Expenses
15,000/-
As awarded by the tribunal
12.
Total compensation
15,22,545/-

20. In this way, the claimants are entitled to total compensation of Rs.15,22,545/- alongwith
interest @ 7% per annum from the date of filing of the claim petition till it's actual payment, which
is to be indemnified by the insurer of the offending vehicle No.UP-21-BK-5747.

21. The appeal is allowed. The impugned judgment and award of the tribunal dated
12.07.2024 is modified to the above extent.

22. If any amount has been paid by the insurance company previously, then it is entitled to
adjust it accordingly. The insurance company is directed to deposit the enhanced amount of
compensation before the concerned tribunal within two months. The tribunal will be at liberty to
proportionally award the enhanced amount of compensation to the claimants, keeping in view their
age and dependency.
----------
(2026) 1 ILRA 1310
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 12.01.2026

BEFORE

THE HON'BLE SANDEEP JAIN, J.

First Appeal From Order No. 3821 of 2011

Smt. Jyoti & Ors. ...Appellants
Versus
Neha Khatri & Ors. ...Respondents

Issue for Consideration
(i) Whether the finding of contributory negligence to the extent of 20% attributed to the deceased was
sustainable;
(ii) Whether the compensation awarded by the Tribunal required enhancement with respect to (a)
computation of income including allowances, (b) future prospects, (c) deduction towards personal expenses,
(d) non-pecuniary heads, and (e) effect of compassionate appointment and pension.

Headnotes
Motor Vehicles Act, 1988 - Accident - Negligence - Contributory negligence - Evidence:
1 All. Smt. Jyoti & Ors. Vs. Neha Khatri & Ors.
1311
Held: The finding of contributory negligence must be based on cogent evidence - Where the eye witness
categorically deposed that the offending vehicle crossed the divider, came to the wrong side of the road and
collided head-on with the motorcycle, the accident stood proved to have occurred due to sole negligence of
the offending driver - The Tribunal erred in attributing 20% contributory negligence to the deceased - The
said finding being perverse was liable to be set aside. [Paras 13-17]

Motor
Vehicles
Act,
1988
-
Compensation
-
Income
-
Salary
-
Allowances:
Held: While determining income of the deceased, all allowances forming part of salary are to be included -
Exclusion of allowances such as HRA, conveyance, diet and washing allowance by the Tribunal was erroneous
- Compensation is to be computed on the basis of gross salary and only statutory deductions such as income
tax are permissible - The income of the deceased was liable to be taken at Rs.13,049/- per month. [Paras
21-22]

Motor Vehicles Act, 1988 - Compensation - Future prospects - Compassionate appointment -
Pension:

Held: Grant of compassionate appointment and receipt of family pension by dependants are not relevant for
denying compensation towards future prospects - Such benefits arise out of separate contractual or service
rights and have no nexus with compensation under the Act - The claimants were entitled to addition of 50%
towards future prospects in terms of Rule 220-A of the U.P. Motor Vehicles Rules, 1998 - The Tribunal erred
in denying the same. [Paras 28, 31-32]

Motor Vehicles Act, 1988 - Compensation - Deduction - Personal expenses - Dependants:

Held: Where the deceased had four dependants, deduction towards personal expenses is to be made to the
extent of one-fourth and not otherwise - The dependency is to be computed on the remaining income. [Para
33]

Motor Vehicles Act, 1988 - Compensation - Non-pecuniary heads - Consortium -
Enhancement:

Held: The claimants are entitled to compensation under conventional heads including consortium, loss of
estate and funeral expenses in accordance with settled principles - The amounts awarded by the Tribunal
were inadequate and required enhancement. [Paras 24-26, 28]

Motor Vehicles Act, 1988 - Appeal - Enhancement of compensation - Re-determination:
Held: Upon re-determination of income, addition of future prospects, appropriate deduction towards personal
expenses, application of correct multiplier and enhancement under non-pecuniary heads, the compensation
payable to the claimants was liable to be substantially enhanced - The award of the Tribunal was modified
accordingly. [Paras 33-35]

Appeal allowed. (E-14)
.
Case Law Cited
Vimal Kanwar and others Vs. Kishore Dan and others (2013) 7 SCC 476; Jiju Kuruvila v.
Kunjujamma Mohan, (2013) 9 SCC 166 - relied on; Prabhavati v. Managing Director, BMTC,
2025 SCC OnLine SC 455 - relied on; National Insurance Co. Ltd. v. Indira Srivastava, (2008) 2
SCC 763 - relied on; Shyamwati Sharma v. Karam Singh, (2010) 12 SCC 378 - relied on;
Manasvi Jain v. Delhi Transport Corporation Ltd., (2014) 13 SCC 22 - relied on; Kavita Devi v.
Sunil Kumar, 2025 SCC OnLine SC 1639 - relied on; Manorma Sinha v. Divisional Manager,
Oriental Insurance Co. Ltd., 2025 SCC OnLine SC 2241 - relied on; National Insurance Co. Ltd. v.
Pranay Sethi, (2017) 16 SCC 680 - relied on;
1312 INDIAN LAW REPORTS ALLAHABAD SERIES
Magma General Insurance Co. Ltd. v. Nanu Ram, (2018) 18 SCC 130 - relied on; Rahul
Ganpatrao Sable v. Laxman Maruti Jadhav, (2023) 13 SCC 334 - relied on; FAFO No.2581 of
2011, Sushil Kumar & Another vs. M/S Sampark Lojastic Pvt. Ltd. & Another, decided on
26.04.2017; Sebastiani Lakra v. National Insurance Co. Ltd., (2019) 17 SCC 465 - relied on;
Hanumantharaju B. v. M. Akram Pasha, 2025 SCC OnLine SC 1106 - relied on; National
Insurance Co. Ltd. v. Rekhaben, (2017) 13 SCC 547 - relied on.

List of Acts / Statutes
Motor Vehicles Act, 1988; U.P. Motor Vehicles Rules, 1998.

List of Keywords
Motor accident; Contributory negligence; Sole negligence; Salary computation; Allowances; Future prospects;
Compassionate appointment; Pension; Dependency; Multiplier; Consortium; Compensation enhancement.

Case Arising From
udgment and award dated 30.07.2011 passed by the Motor Accident Claims Tribunal/Additional District Judge,
Court No. 7, Muzaffarnagar in MACP No. 74 of 2010 (Smt. Jyoti and others Vs. Neha Khatri and others).

Appearance for Parties
For the Appellants: Sri Rajiv Sisodia, Sri Santosh Kumar Singh, Sri Shashank Kumar
For the Respondents: Sri Arun Prakash, Sri Harbansh Prasad Pandey

(Delivered by Hon'ble Sandeep Jain, J.)

1. The instant appeal has been filed by the claimants for enhancement of compensation under
Section 173 of the Motor Vehicles Act, 1988, against the impugned judgment and award dated
30.7.2011 passed by the Motor Accident Claims Tribunal/ Additional District Judge, Court No. 7,
Muzaffarnagar in MACP No. 74 of 2010 (Smt. Jyoti and others Vs. Neha Khatri and others),
whereby for the untimely death of Sachin Kumar on 30.12.2009 due to injuries suffered in a motor
accident that occurred on 23.12.2009, a compensation of Rs.14,74,445/- along with interest @ 6%
per annum has been awarded to the claimants, 80% of which has been ordered to be indemnified by
the insurer of offending Car No. UA 07 G 1313.

2. Since no cross appeal has been preferred by the owner, driver, and insurer of the offending
car, the factum of accident and negligence of the offending driver is not disputed by the
respondents.

3. Learned counsel for the claimants-appellants submitted that Sachin Kumar (deceased) was
driving his motorcycle number UP-11-S-2228 cautiously on his side of the road, which was hit by
the offending Car No.UA-07-G-1313, which was being driven rashly and negligently, which was
proved by eye witness PW-2 Satish Kumar. Still, the tribunal held there was 20% contributory
negligence of the deceased, which is against the evidence on record. It was further submitted that
the offending car crossed the divider and came to the wrong side of the road, causing the accident.

4. In view of the above, the tribunal erred in concluding that there was 20% negligence of the
deceased. It was further submitted that the gross salary of the deceased was Rs.13,049/- per month,
but the tribunal assessed compensation on a salary of Rs.11,659/- per month, which is erroneous,
1 All. Smt. Jyoti & Ors. Vs. Neha Khatri & Ors.
1313
because all allowances being paid to the deceased were to be considered for assessing
compensation.

5. It was further submitted that on the ground that a compassionate appointment was offered to
the wife of the deceased, Jyoti, the tribunal has not awarded any compensation towards future
prospects of the deceased, which is erroneous. It was submitted that in light of the decision of the
Apex Court in the case of Vimal Kanwar and others Vs. Kishore Dan and others (2013) 7 SCC
476, the fact of compassionate appointment of the wife of the deceased should not have been
considered while assessing compensation. It was submitted that claimants were entitled to get
compensation towards future prospects of the deceased @ 50% of the income of the deceased,
keeping in view Rule 220-A of the U.P. Motor Vehicle Rules, 1998.

6. It was further submitted that the tribunal awarded inadequate compensation under nonpecuniary heads and also awarded less interest @ 6% per annum instead of 7% per annum.

7. With these submissions, it was prayed that the appeal preferred by the claimants be allowed
and compensation payable to them be enhanced.

8. Per contra, learned counsel for the respondent-Insurance Company submitted that the
deceased was driving his motorcycle at the time of accident rashly and negligently, who
contributed to the accident as proved by the evidence of the offending car's driver Neha Khatri,
who was examined as DW-1 before the tribunal. Hence, the tribunal rightly assessed 20%
contributory negligence on the part of the deceased. It was further submitted that since the wife of
the deceased was offered compassionate appointment and was getting a salary of Rs.7,100/- and
family pension of Rs.4,690/- per month, the tribunal has rightly not awarded any compensation
towards future prospects of the deceased. It was also submitted that the deceased was getting house
rent allowance of Rs.760/-, vehicle allowance of Rs.50/-, special diet allowance of Rs.550/-, and
washing allowance of Rs.30/- per month, which were personal allowances for his benefit, which are
not to be considered for assessing compensation. The tribunal rightly excluded these allowances
while assessing compensation. With these submissions, it was prayed that the appeal has no merit
and is liable to be dismissed.

9. I have heard learned counsel for both parties and perused the impugned judgment and the
documents submitted with the appeal.

10. The Apex Court in the case of Jiju Kuruvila & Ors. vs. Kunjujamma Mohan & Ors.
(2013) 9 SCC 166, held as under:-

"20.5. The mere position of the vehicles after accident, as shown in a scene mahazar,
cannot give a substantial proof as to the rash and negligent driving on the part of one or the other.
When two vehicles coming from opposite directions collide, the position of the vehicles and its
direction, etc. depends on a number of factors like the speed of vehicles, intensity of collision,
reason for collision, place at which one vehicle hit the other, etc. From the scene of the accident,
one may suggest or presume the manner in which the accident was caused, but in the absence of
any direct or corroborative evidence, no conclusion can be drawn as to whether there was
1314 INDIAN LAW REPORTS ALLAHABAD SERIES
negligence on the part of the driver. In absence of such direct or corroborative evidence, the Court
cannot give any specific finding about negligence on the part of any individual.

20.6. The post-mortem report, Ext. A-5 shows the condition of the deceased at the time of
death. The said report reflects that the deceased had already taken meal as his stomach was halffull and contained rice, vegetables and meat pieces in a fluid with strong smell of spirit. The
aforesaid evidence, Ext. A-5 clearly suggests that the deceased had taken liquor but on the basis of
the same, no definite finding can be given that the deceased was driving the car rashly and
negligently at the time of accident. The mere suspicion based on Ext. B-2 "scene mahazar" and
Ext. A-5 post-mortem report cannot take the place of evidence, particularly, when the direct
evidence like PW 3 (independent eyewitness), Ext. A-1 (FIR), Ext. A-4 (charge-sheet) and Ext. B-1
(FI statement) are on record."

11. The Apex Court in the case of Prabhavati & Ors. vs. Managing Director, Bangalore
Metropolitan, Transport Corporation 2025 SCC OnLine SC 455, held as under:-

"10. We are unable to agree with the view taken by the High Court on the 25%
contributory negligence of the deceased and 75% upon the driver of the bus. We find ourselves to
agree with the view taken by the Tribunal on this issue. The Tribunal rightly, after considering the
evidence on record and on perusal of the Ex. P3 Spot Mahazar, came to the conclusion that there
wasn't any sufficient evidence on record, indicating that the accident occurred due to negligent
driving on the part of the deceased, and after considering the oral evidence of P.W.1, held the
cause of the accident to be rash and negligent on the part only of the offending vehicle.

11. Thus, in our considered view, the contributory negligence taken by the High Court at
25% of the deceased is erroneous. We advert to the principles laid down in Jiju Kuruvila v.
Kunjujamma(supra) where it was held that in the absence of any direct or corroborative evidence
on record, it cannot be assumed that the accident occurred due to the rash and negligent driving of
both the vehicles. This exposition came to be followed in Kumari Kiran v. Sajjan Singh (2015) 1
SCC 539. In the present case, therefore, on an allegation simpliciter, it cannot be presumed that
the accident occurred due to rash and negligent driving of both vehicles, for having driven at high
speed."

12. Before the tribunal the claimants have examined the wife of the deceased Smt. Jyoti as
PW-1, eye witness Satish Kumar Latiyan as PW-2. Whereas, the offending car driver Smt. Neha
Khatri has examined herself as DW-1.

13. Smt. Jyoti PW-1 has very fairly accepted that she was not an eye witness of the accident.
PW-2 Satish Kumar Latiyan deposed that the accident occurred on 23.12.2009 at about 09.00 PM,
when his brother in law Sachin Kumar (deceased) was going by his motorcycle from Vikas Nagar,
Dehradun to police Station Kalsi and when the deceased reached near petrol pump in Vikas Nagar,
then his motorcycle was hit head- on by the offending Car No. UA07-G-1313, which was being
driven in a rash and negligent manner, which came towards the wrong side of the road, due to
which the deceased suffered grievous injuries, who was taken to Herbertpur Christian Hospital
from where he was referred to Joly Grant Hospital, Dehradun, where he died during treatment on
30.12.2009. He further deposed that the car fled after the accident and the accident was witnessed
1 All. Smt. Jyoti & Ors. Vs. Neha Khatri & Ors.
1315
by him and deceased's cousin brother Amit, who were getting their vehicle refilled at the petrol
pump. He further deposed that in the accident the deceased suffered grievous injuries in his head.

14. In the cross-examination he deposed that the offending car hit the motorcycle of the
deceased head on. He further deposed that the car was being driven on the wrong side of the
divider. He denied the suggestion that the accident was caused due to the rashness and negligence
of the deceased who was driving the motorcycle at that time.

15. The offending car driver Smt. Neha Khatri DW-1 deposed that at the time of the accident,
the deceased was driving his motorcycle rashly and negligently, due to which his motorcycle
skidded and his head collided with the divider, due to which his head was got severely injured, but
the tribunal has disbelieved the above testimony. She admitted that the deceased was driving his
motorcycle at the time of the accident, which collided with her car, which was being driven slowly
and cautiously, due to which the bumper,radiator,headlight of the front left side and front wind
screen of the car were damaged. She further admitted that the police seized her car which was
subsequently released by the Court.

16. The tribunal has also considered the site plan prepared in the criminal case, which
disclosed that the offending car crossed the divider and came towards the wrong side of the road
and then it hit the motorcycle of the deceased head on and due to this, the tribunal concluded that
the offending car driver contributed 80% towards the accident whereas, the deceased contributed
only 20%, which is a perverse finding. It was proved from the evidence of PW-2 that the offending
car crossed the divider, came to the wrong side of the road and then collided head-on with the
motorcycle of the deceased, which proved that the accident occurred due to the sole negligence of
the offending car driver.

17. Accordingly, the finding of the tribunal regarding the contributory negligence of the
deceased in the accident is set aside and it is held that the accident occurred due to the sole rashness
and negligence of the offending car driver Smt. Neha Khatri.

18. The Apex Court in the case of National Insurance Company Ltd vs Indira Srivastava
& Ors (2008) 2 SCC 763 has held that the amount 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 and from the said amount of income, the statutory amount of tax payable
thereupon must be deducted. It was further held that net income would ordinarily mean gross
income minus the statutory deductions.

19. The Apex Court in the case of Shyamwati Sharma & Ors vs Karam Singh & Ors
(2010) 12 SCC 378 and Manasvi Jain Vs. Delhi Transport Corporation Ltd. & Ors. (2014) 13
SCC 22 (By 3 Judges) has held that while ascertaining the income of the deceased, any deductions
shown in the salary certificate as deductions towards GPF, life insurance premium, repayments of
loans etc., should not be excluded from the income. The deduction towards income tax/surcharge
alone should be considered to arrive at the net income of the deceased.
1316 INDIAN LAW REPORTS ALLAHABAD SERIES

20. The Apex Court in the case of Kavita Devi and others vs Sunil Kumar and another
2025 SCC OnLine SC 1639 and Manorma Sinha and another vs The Divisional Manager,
Oriental Insurance Co. Ltd. and another 2025 SCC OnLine SC 2241 has held that the
allowances paid to the deceased, which are included in the salary, whether taxable or not, should be
included while assessing loss of income as they are used for supporting the family, if the
allowances were regularly received and used for the family's benefit.

21. In view of the above law laid down by the Apex Court, it is clear that all the allowances
being paid to the deceased by his employer should be considered while assessing the compensation
in a claim case and only the amount deducted towards income tax and surcharge should be
considered to arrive at the net income of the deceased.

22. It is apparent that the gross salary of the deceased was Rs.13,049/- per month but the
tribunal has ignored HRA of Rs.760/-, conveyance allowance of Rs.50/-, special diet allowance of
Rs.550/- and washing allowance of Rs.30/- per month, which comes to Rs.1,390/- per month, and
the tribunal after deducting the above allowances, has assessed the compensation by taking the
salary of the deceased at only Rs.11,659/- per month. It is well settled that all the allowances being
paid to a salaried employee are required to be considered for assessing compensation and only the
income tax paid on the salary is required to be deducted. It is further apparent that if the above
allowances have not been given to the deceased then certainly he would have spent it from his
salary which would have reduced the resources available to the family and affected their
dependency, as such, the compensation is to be determined on the basis of gross salary of the
deceased, which was Rs.13,049/- per month, on which no income tax was payable at that time,
because the exemption limit was Rs. 1,60,000/- per annum.

23. Rule 220-A of the UP Motor Vehicle Rules,1998 w.e.f. 26.09.2011, mandates that when
the deceased was aged below 40 years on the date of accident, the claimants are also entitled to
compensation on future prospects @50% of his income.

24. The Constitution Bench of the Apex Court in the case of National Insurance Co. Ltd. vs.
Pranay Sethi & Ors.(2017) 16 SCC 680 has awarded loss of consortium of Rs.40,000/- and
Rs.15,000/- each towards loss of estate and funeral expenses, which is to be enhanced at the rate of
10% after every three years.

25. The Apex Court in the case of Magma General Insurance Company Ltd. Vs. Nanu
Ram @ Chuhru Ram & others, (2018) 18 SCC 130, has awarded Rs.40,000/- each towards
spousal consortium, parental consortium and filial consortium.

26. Further, the Apex Court in the case of Rahul Ganpatrao Sable vs Laxman Maruti
Jadhav (Dead) through LRS and Others (2023) 13 SCC 334, held as under:-

"32. In the present case, MACT had granted a meagre amount of Rs 5000 towards loss of
consortium. However, the High Court granted a total amount of Rs 70,000 as consolidated amount
under all conventional heads, which included loss of consortium, loss of estate and funeral
expenses. In Pranay Sethi [National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680 :
1 All. Smt. Jyoti & Ors. Vs. Neha Khatri & Ors.
1317
(2018) 3 SCC (Civ) 248 : (2018) 2 SCC (Cri) 205] , the Constitution Bench of this Court had
provided that all dependents should be separately awarded towards loss of consortium and had
actually awarded Rs 40,000 to each of the dependents. Considering the same, an amount of Rs
40,000 each is awarded to each of the four dependents towards loss of consortium."

(emphasis supplied)

27. A Division Bench of this Court in FAFO No.2581 of 2011, Sushil Kumar & Another vs.
M/S Sampark Lojastic Pvt. Ltd. & Another, decided on 26.04.2017 has held that even if the
accident occurred prior to 26.09.2011, the claimants are entitled to compensation on future
prospects as per amended Rule 220-A of the UP Motor Vehicle Rules, 1998, since it is a beneficial
legislation.

28. It is further apparent that as per the decision of the Apex Court in the case of Pranay Sethi
(supra) read with Rule 220-A of the UP Motor Vehicle Rules,1998, the claimants were entitled to
get compensation towards future prospect of the deceased at the rate of 50% of his income, but the
tribunal has not awarded any amount towards it, which is erroneous. It is further apparent that as
per the above Rule, the claimants were entitled to get interest on the compensation at the rate of 7%
per annum but the tribunal has awarded it at the rate of 6% per annum, which requires
enhancement. It is further apparent that the claimants are entitled to enhanced compensation under
non-pecuniary heads keeping in view of the judgment of the Apex Court in Pranay Sethi (supra),
Magma General Insurance Co. Ltd.(supra) and Rahul Ganpatrao Sable (supra).

29. The Apex Court in the case of Sebastiani Lakra and others vs. National Insurance
Company Limited and another, (2019) 17 SCC 465, (By 3 Judges), while discussing the amount
which are to be deducted for assessment of compensation has held as under:

"12. The law is well settled that deductions cannot be allowed from the amount of
compensation either on account of insurance, or on account of pensionary benefits or gratuity or
grant of employment to a kin of the deceased. The main reason is that all these amounts are earned
by the deceased on account of contractual relations entered into by him with others. It cannot be
said that these amounts accrued to the dependants or the legal heirs of the deceased on account of
his death in a motor vehicle accident. The claimants/dependants are entitled to ?just
compensation? under the Motor Vehicles Act as a result of the death of the deceased in a motor
vehicle accident. Therefore, the natural corollary is that the advantage which accrues to the estate
of the deceased or to his dependants as a result of some contract or act which the deceased
performed in his lifetime cannot be said to be the outcome or result of the death of the deceased
even though these amounts may go into the hands of the dependants only after his death.

13. As far as any amount paid under any insurance policy is concerned whatever is
added to the estate of the deceased or his dependants is not because of the death of the deceased
but because of the contract entered into between the deceased and the insurance company from
where he took out the policy. The deceased paid premium on such life insurance and this amount
would have accrued to the estate of the deceased either on maturity of the policy or on his death,
whatever be the manner of his death. These amounts are paid because the deceased has wisely
invested his savings. Similar would be the position in case of other investments like bank deposits,
1318 INDIAN LAW REPORTS ALLAHABAD SERIES
share, debentures, etc. The tortfeasor cannot take advantage of the foresight and wise financial
investments made by the deceased.

14. As far as the amounts of pension and gratuity are concerned, these are paid on
account of the service rendered by the deceased to his employer. It is now an established principle
of service jurisprudence that pension and gratuity are the property of the deceased. They are more
in the nature of deferred wages. The deceased employee works throughout his life expecting that on
his retirement he will get substantial amount as pension and gratuity. These amounts are also
payable on death, whatever be the cause of death. Therefore, applying the same principles, the said
amount cannot be deducted.

15. As held by the House of Lords in Parry v. Cleaver [Parry v. Cleaver, 1970 AC 1 :
(1969) 2 WLR 821 : 1969 ACJ 363 (HL)] the insurance amount is the fruit of premium paid in the
past, pension is the fruit of services already rendered and the wrongdoer should not be given
benefit of the same by deducting it from the damages assessed.

16. Deduction can be ordered only where the tortfeasor satisfies the court that the
amount has accrued to the claimants only on account of death of the deceased in a motor vehicle
accident."

30. The Apex Court in the case of Hanumantharaju B. through LR vs. M. Akram Pasha
and another, 2025 SCC Online SC 1106, while discussing whether the pension payable to the
claimant can be deducted for computing his income, has held as under:

"19. It is also now well settled that the amount of compensation is to be calculated on the basis of
last drawn salary of the injured/deceased in respect of salaried persons and pension and such retirement
benefits enjoyed cannot be deducted for computing the income, these being statutory rights receivable by the
employee or his legal heirs irrespective of any unforeseen incident of accidents, fatal injuries etc. and such
pensionary benefit is not directly relatable to the motor accident. Hence, pensionary benefit could not have
been treated as "pecuniary advantage" liable to be deducted for the purpose of computation of
compensation within the scope of Motor Vehicles Act, 1988.

For this proposition of law, we may refer to the decision in Vimal Kanwar v. Kishore Dan (2013) 7
SCC 476, wherein this Court, by referring to the earlier decision in Helen C. Rebello v. Maharashtra SRTC
(1999) 1 SCC 90, held as follows:-

"19. The aforesaid issue fell for consideration before this Court in Helen C. Rebello v. Maharashtra
SRTC [(1999) 1 SCC 90 : 1999 SCC (Cri) 197]. In the said case, this Court held that provident fund, pension,
insurance and similarly any cash, bank balance, shares, fixed deposits, etc. are all a ?pecuniary advantage?
receivable by the heirs on account of one's death but all these have no correlation with the amount receivable
under a statute occasioned only on account of accidental death. Such an amount will not come within the
periphery of the Motor Vehicles Act to be termed as "pecuniary advantage" liable for deduction. The following
was the observation and finding of this Court : (SCC pp. 111-12, para 35)

"35. Broadly, we may examine the receipt of the provident fund which is a deferred
payment out of the contribution made by an employee during the tenure of his service. Such
employee or his heirs are entitled to receive this amount irrespective of the accidental death. This
amount is secured, is certain to be received, while the amount under the Motor Vehicles Act is
uncertain and is receivable only on the happening of the event viz. accident, which may not take
place at all. Similarly, family pension is also earned by an employee for the benefit of his family in
the form of his contribution in the service in terms of the service conditions receivable by the heirs
1 All. Smt. Jyoti & Ors. Vs. Neha Khatri & Ors.
1319
after his death. The heirs receive family pension even otherwise than the accidental death. No co-relation
between the two. Similarly, life insurance policy is received either by the insured or the heirs of the insured
on account of the contract with the insurer, for which the insured contributes in the form of premium. It is
receivable even by the insured if he lives till maturity after paying all the premiums. In the case of death,
the insurer indemnifies to pay the sum to the heirs, again in terms of the contract for the premium paid.
Again, this amount is receivable by the claimant not on account of any accidental death but otherwise on
the insured's death. Death is only a step or contingency in terms of the contract, to receive the amount.
Similarly, any cash, bank balance, shares, fixed deposits, etc. though are all a pecuniary advantage
receivable by the heirs on account of one's death but all these have no co-relation with the amount
receivable under a statute occasioned only on account of accidental death. How could such an amount
come within the periphery of the Motor Vehicles Act to be termed as 'pecuniary advantage' liable for
deduction. When we seek the principle of loss and gain, it has to be on a similar and same plane having nexus,
inter se, between them and not to which there is no semblance of any co-relation. The insured (the deceased)
contributes his own money for which he receives the amount which has no co-relation to the compensation
computed as against the tortfeasor for his negligence on account of the accident. As aforesaid, the amount
receivable as compensation under the Act is on account of the injury or death without making any contribution
towards it, then how can the fruits of an amount received through contributions of the insured be deducted out
of the amount receivable under the Motor Vehicles Act. The amount under this Act he receives without any
contribution. As we have said, the compensation payable under the Motor Vehicles Act is statutory while the
amount receivable under the life insurance policy is contractual."

Thus, this Court has categorically held that any amount receivable on account of PF, pension
or insurance cannot be deducted from the salary of the victim for the purpose of determining the income
or loss of earning for calculating compensation. This principle was reiterated in Reliance General
Insurance Co. Ltd. v. Shashi Sharma (2016) 9 SCC 627 and National Insurance Company Ltd. v. Birender
(2020) 11 SCC 356."

31. The Apex Court in the case of National Insurance Co. Ltd. vs Rekhaben and others
(2017) 13 SCC 547, held as under:-

"22. In the present cases, the claimants were offered compassionate employment. The claimants
were not offered any sum of money equal to the income of the deceased. In fact, they were not offered any
sum of money at all. They were offered employment and the money they receive in the form of their salary,
would be earned from such employment. The loss of income in such cases cannot be said to be set off
because the claimants would be earning their living. Therefore, we are of the view that the amount earned
by the claimants from compassionate appointments cannot be deducted from the quantum of
compensation receivable by them under the Act.

23. In the cases before us, compensation is claimed from the owner of the offending vehicle who
is different from the employer who has offered employment on compassionate grounds to the dependants
of the deceased/injured. The source from which compensation on account of the accident is claimed and
the source from which the compassionate employment is offered, are completely separate and there is no
co-relation between these two sources. Since the tortfeasor has not offered the compassionate
appointment, we are of the view that an amount which a claimant earns by his labour or by offering his
services, whether by reason of compassionate appointment or otherwise is not liable to be deducted from
the compensation which the claimant is entitled to receive from a tortfeasor under the Act. In such a
situation, we are of the view that the financial benefit of the compassionate employment is not liable to be
1320 INDIAN LAW REPORTS ALLAHABAD SERIES
deducted at all from the compensation amount which is liable to be paid either by the owner/the driver of
the offending vehicle or the insurer."

32. It is further apparent that since Smt. Jyoti, the wife of the deceased was offered compassionate
appointment after the death of her husband as Constable, who was getting a salary of Rs.7,100/- per month
and also family pension of Rs.4,690/- per month, the tribunal has not awarded any compensation towards
the future prospect of the deceased, which is erroneous. It is well settled that the compassionate
appointment offered to legal heirs as well as the amount of family pension, awarded to them, is not to be
considered while assessing compensation in a claims case. In view of this, the claimants are entitled to get
compensation towards future prospect of the deceased @50% of the income of the deceased.

33. In view of the above statutory law and precedents of the Apex Court, the compensation
payable to the claimants is redetermined as under:-

S.No.
Compensation Heads
Amount
Awarded(in
Rs.)
In Accordance with.

1.
Monthly income of deceased

13,049/-

Salary certificate of the deceased

2.
Annual Income of deceased

13,049X12=1,56,588/-

Salary certificate of the deceased

3.
Less
1/4th
deduction
towards
self
expenses(4 dependents)

39,147/-

Pranay Sethi(supra)

4.
Net annual income on which claimants
were dependent

1,17,441/-

Pranay Sethi(supra)
5.
Add future prospects @50% since deceased
was aged about 29 years

58,720/-

UP Motor Vehicle Rules,1998

6.
Total annual dependency of claimants on
deceased

1,76,161/-

Pranay Sethi(supra)
7.
Multiplier applied since age of deceased
was about 29 years at the time of accident

17
Pranay Sethi(supra)
8.
Total loss of dependency to the claimants

1,76,161X17=29,94,737/-

Pranay Sethi(supra)
9.
Loss of consortium @Rs.40,000/-each,
increased by 10% after every 3 years (4
claimants)

48,400X4=1,93,600/-

Pranay Sethi(supra) , Magma General
Insurance Co. Ltd. (supra) and Rahul
Ganpatrao Sable (supra)

10.
Loss of estate @ Rs.15,000/- increased by
10% after every 3 years.

18,150/-
Pranay Sethi(supra)
11.
Funeral Expenses@ Rs.15,000/- increased
by 10% after every 3 years.

18,150/-
Pranay Sethi(supra)
12.
Treatment expenses

49,730/-
As awarded by the tribunal
13.
Total compensation
32,74,367/-

34. In this way, the claimants are entitled to total compensation of Rs.32,74,367/- alongwith
interest @ 7% per annum from the date of filing of the claim petition till it's actual payment, which
is
to
be
indemnified
by
the
insurer
of
the
offending
car
No.
UA-07-G-1313.
1 All. Dr. Dinesh Kumar Agarwal & Ors. Vs. State of U.P. & Ors.
1321

35. Accordingly, the appeal is allowed. The award of the tribunal dated 30.07.2011 is
modified to the above extent.

36. If any amount has been paid by the insurance company previously, then the insurance
company is entitled to adjust it accordingly. The insurance company is directed to deposit the
enhanced amount of compensation before the concerned tribunal within two months. The tribunal
will be at liberty to proportionally award the enhanced amount of compensation to the claimants
keeping in view their age and dependency.
----------
(2026) 1 ILRA 1321
APPELLATE JURISDICTION
CIVIL SIDE
DATED: LUCKNOW 21.01.2026
BEFORE

THE HON'BLE ARUN BHANSALI, C.J.
THE HON'BLE JASPREET SINGH, J.

Special Appeal No. 221 of 2023 & 225 of 2023

Dr. Dinesh Kumar Agarwal & Ors. ...Appellant
Versus
State of U.P. & Ors. ...Respondents

Issues for Consideration
(i) Whether, in exercise of parens patriae jurisdiction, custody of a minor child already held to be lawful with
the mother could be transferred to the father in intra-court appeal arising out of habeas corpus proceedings;
(ii) Whether, in the alternative, the Court ought to direct that the minor child be sent to a boarding school in
the alleged interest of his welfare;
(iii) Whether modification of visitation arrangements by the learned Single Judge was justified when the
original visitation order itself remained unimplemented.

Headnotes
Child Custody - Habeas Corpus - Scope - Custody already adjudicated:

Held: Where custody of the minor child had already been adjudicated and restored to the mother pursuant to
orders affirmed by the Supreme Court, and subsequent habeas corpus petition filed by the father stood
dismissed, the issue of custody cannot be reopened in intra-court appeal in absence of emergent or
exceptional circumstances. [Paras 60, 77]

Child Custody - Paramount consideration - Welfare of child:

Held: Welfare of the child is the paramount consideration and must be assessed on holistic factors including
stability, education, environment and emotional well-being - Mere comparative financial superiority of one
parent is not determinative - Where the child is settled, studying well and accustomed to the mother's care,
change of custody is unwarranted. [Paras 73-76]

Parens Patriae Jurisdiction - Limits - Absence of exceptional circumstances:
Held: Though the Court possesses wide powers under parens patriae jurisdiction, such powers must be
exercised on cogent material - In absence of evidence indicating adverse environment or harm to the child,
drastic measures like change of custody cannot be resorted to. [Paras 59, 76-77]