# TATA A.I.G. General Insurance Co. Ltd. Parel Mumbai v. Amar Kaur & Ors

- **Citation:** (2023) 1 ILRA 854
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2022-11-04
- **Case number:** First Appeal From Order No. 2385 of 2017
- **Bench:** Ajay Bhanot
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/tata-a-i-g-general-insurance-co-ltd-parel-mumbai-v-amar-kaur-ors-49197
- **Pages:** 7

## Headnote

Civil Law - Motor Vehicles Act, 1988 -
Sections 166 & 168, - UP Motor Vehicles
Rules, 1998- Rule 220-A(3) - Appeals -
claimants' seeks enhancement and Insurance
Co. assailed quantum of Compensation -
appreciation
of
evidence
-
accident
and
accidental death is not in dispute - court finds
that - learned tribunal not determined the
compensation lawfully while computing the
amounts under the heads of Salary, future
prospects & conventional heads and interest
except application of multiplier - hence, appeal
of insurance Co. is dismissed but, in the light of
judgment of Hon'ble Apex court rendered in
case of Pranay Sethi's, Urmilla Shukla's, Sarla
Verma's, Sarla Devi's, K.R. Madhusudhan's, K.L.
Narayana Reddy's claimants' Appeal is partly
allowed - impugned award modified & enhanced
from Rs. 34,96,000/- to Rs. 39,17,563/- along
with 7% interest - directions issued accordingly.
(Para - 18, 19, 21, 22, 23, 24, 25, 26)

Appeal is partly allowed. (E-11)

List of Cases cited:

## Text

854 INDIAN LAW REPORTS ALLAHABAD SERIES
(2023) 1 ILRA 854
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 04.11.2022

BEFORE

THE HON'BLE AJAY BHANOT, J.

First Appeal From Order No. 2385 of 2017
With
First Appeal From Order No. 3211 of 2017

TATA A.I.G. General Insurance Co. Ltd.
Parel Mumbai ...Appellant
Versus
Amar Kaur & Ors. ...Respondents

Counsel for the Appellant:
Sri Sushil Kumar Mehrotra

Counsel for the Respondents:
Sri Ram Singh, Sri Sudhir Dixit

Civil Law - Motor Vehicles Act, 1988 -
Sections 166 & 168, - UP Motor Vehicles
Rules, 1998- Rule 220-A(3) - Appeals -
claimants' seeks enhancement and Insurance
Co. assailed quantum of Compensation -
appreciation
of
evidence
-
accident
and
accidental death is not in dispute - court finds
that - learned tribunal not determined the
compensation lawfully while computing the
amounts under the heads of Salary, future
prospects & conventional heads and interest
except application of multiplier - hence, appeal
of insurance Co. is dismissed but, in the light of
judgment of Hon'ble Apex court rendered in
case of Pranay Sethi's, Urmilla Shukla's, Sarla
Verma's, Sarla Devi's, K.R. Madhusudhan's, K.L.
Narayana Reddy's claimants' Appeal is partly
allowed - impugned award modified & enhanced
from Rs. 34,96,000/- to Rs. 39,17,563/- along
with 7% interest - directions issued accordingly.
(Para - 18, 19, 21, 22, 23, 24, 25, 26)

Appeal is partly allowed. (E-11)

List of Cases cited:

1. National Insurance Co. Ltd. Vs Pranay Sethi &
ors., (2017 (16) SCC 680),

2. New India Assurance Co. Ltd. Vs Urmilla
Shukla & ors. (2021 SSC Online SC 822),

3. Smt. Sarla Verma & ors. v. Delhi Transport
Corp. & anr. (2009 (6) SCC 121),

4. Divisional manager, Royal Sundaram Alliance
Insurance Co. Ltd. Vs Sarladevi & ors. (2013 (1)
TAC 77 (Mad),

5. K R Madhusudhan VS Administrative Officer
(2011 vol. 4 SCC 689),

6. Puttamma Vs K. L. Narayana Reddy (2013
vol. 15 SCC 45),

(Delivered by Hon'ble Ajay Bhanot, J.)

1. Heard Shri Ram Singh, learned
counsel for the appellant-claimants and
Shri Sushil Kumar Mehrotra, learned
counsel
for
the
appellant-Insurance
Company.

I. INTRODUCTION

2. These two appeals arise out of an
award made by the learned Motor Accident
Claims Tribunal/Additional District Judge,
Aligarh1 in Motor Accident Claim Petition
No. 709 of 2014 (Amar Kaur and another
Vs. Tata A.I.G. General Insurance Co. Ltd.
and others) dated 11.04.2017 by partly
allowing the claim of the claimants.

2.1. The appeals have been filed
by the Insurance Company and the
claimants respectively and are being
decided by a common judgement.

II. Case of the claimants and
respondents before the learned tribunal:
1 All. TATA A.I.G. General Insurance Co. Ltd. Parel Mumbai Vs. Amar Kaur & Ors.
855

3. Briefly the case of the claimants
before the learned tribunal was that the
deceased died of injuries sustained in an
accident which occurred on 26.08.2014,
and was caused by the rash and negligent
driving of the driver of Bolero Jeep bearing
Registration No. UP 81 X 0168. The
offending vehicle was insured by TATA
AIG General Insurance Company Ltd. The
deceased was pillion rider on a motorcycle
bearing Registration No. DL75BK-4482
driven by his son Pawan Kumar when the
accident occurred. The claimants are the
dependants of the deceased Kalicharan. The
deceased was 58 years of age at the time of
his death.

III. Compensation awarded by the
learned tribunal

4. The learned tribunal in the
impugned judgement dated 11.04.2017
awarded compensation which is depicted in
the tabulated form hereunder:

Sr.No.
Heads
Amount Awarded by
the tribunal
1.
Monthly Income (A)
40,000/-
2.
Annual Income (B)
(Ax12=B)
4,80,000/-
3.
Future Prospects (C)
20%
of
4,80,000=
96,000/-
4.
Annual
Income
+
Future Prospects
(B+C=D)
4,80,000+96,000/-
=5,76,000/-
5.
Deduction
towards
personal expenses (E)
(1/3 of D)
1/3
of
5,76,000/-
=1,92,000/-
6.
Annual
Loss
of
dependancy (F)
(D-E =F)
5,76,000-1,92,000/-
= 3,84,000/-
7.
Multiplier (G)
9
8.
Total
loss
of
dependancy
(F x G)
3,84,000 x 9
= 3,456,000/-
9.
Conventional Heads
(a) Loss of consortium
(b) loss of Estate
(c) Funeral Expenses
40,000/-
10.
Total compensation
3,456,000 + 40,000/-
= 3,496,000/-
11.
Interest
7%

4.1. The appeal filed by the claimants
seeks enhancement of compensation, and
the Insurance Company in appeal has
assailed the quantum of compensation as
being excessive.

IV. Submissions of learned counsels
for the parties:

5. Shri Sushil Kumar Mehrotra,
learned counsel for the appellant-Insurance
Company submits that the income of the
deceased
was
incorrectly
calculated.
Secondly the future prospects of 20% were
not liable to be calculated in view of the
judgement
of
National
Insurance
Company Ltd. vs. Pranay Sethi and
others2.
Thirdly
adoption
of
split
multiplier was advocated on behalf of the
Insurance Company.

6. Sri Ram Singh, learned counsel for
the claimants-respondents submits that the
compensation was not rightly calculated.
The claimants were entitled to a higher
amount.

V. Issues for Consideration:

7. After advancing their arguments,
learned counsels for the respective parties
agree that only the following question
falls for consideration in these appeals:

Whether the learned tribunal
while
determining
the
compensation
lawfully computed the amounts under
856 INDIAN LAW REPORTS ALLAHABAD SERIES
these heads: salary, future prospects,
application of multiplier, conventional
heads and interest?

VI a. Issue of Salary of the
deceased:

8. The deceased was working as a
supervisor
in
the
Agriculture
Department in Rajasthan. The salary
fixation
certificate
issued
by
the
employer of the deceased records that
the monthly salary of the deceased was
49,480/- and duly proved by the
claimants.

9. Learned tribunal arbitrarily
deducted an amount of Rs. 10,000/- per
month. I am afraid that the aforesaid
deduction is perverse and has no
justification. Income tax @ 10% is
liable to be deducted from the salary of
the deceased. Deducting the income tax
at the rate of 10%, the annual income of
the deceased comes to Rs. 5,93,760/-.
This amount is fixed under the head of
salary and shall be the basis for
computing the compensation.

VI b. Future prospects:

10. The future prospects are liable
to be calculated in accordance with the
Uttar Pradesh Motor Vehicles Rules,
19983. Rule 220A-3(iii) of the Rules is
relevant and is reproduced hereunder:

"(3) The future prospects of a
deceased, shall be added in the actual
salary or minimum wages of the
deceased as under:

"(iii) More than 50 years of
age 20% of the salary"

11. The UP Rules, 1998 came up for
consideration before the Supreme Court
in New India Assurance Co. Ltd. vs.
Urmila Shukla and others4. In Urmila
Shukla (supra) upon consideration of
various judgements including National
Insurance Company Ltd. Vs. Pranay
Sethi and others5 held:

"10. The discussion on the point
in Pranay Sethi was from the standpoint of
arriving at "just compensation" in terms of
Section 168 of the Motor Vehicles Act,
1988.

11. If an indicia is made available
in the form of a statutory instrument which
affords a favourable treatment, the decision
in Pranay Sethi cannot be taken to have
limited the operation of such statutory
provision specially when the validity of the
Rules was not put under any challenge. The
prescription of 15% in cases where the
deceased was in the age bracket of 50-60
years as stated in Pranay Sethi cannot be
taken as maxima. In the absence of any
governing
principle
available
in
the
statutory regime, it was only in the form of
an indication. If a statutory instrument has
devised a formula which affords better or
greater benefit, such statutory instrument
must be allowed to operate unless the
statutory instrument is otherwise found to
be invalid." (emphasis supplied)

12. The Rules of the Uttar Pradesh
Motor Vehicles Rules, 1998 were not under
consideration before the Supreme Court in
Pranay Sethi (supra) or Sarla Verma (Smt)
and others Vs. Delhi Transport Company
and another6. Future prospects in Pranay
Sethi (supra) were determined without
noticing the U.P. Rules,1998. This fact was
adverted to in Urmila Shukla (supra):
1 All. TATA A.I.G. General Insurance Co. Ltd. Parel Mumbai Vs. Amar Kaur & Ors.
857

"8. It is submitted by Mr. Rao that
the judgment in Pranay Sethi does not show
that the attention of the Court was invited
to the specific rules such as Rule 3(iii)
which contemplates addition of 20% of the
salary as against 15% which was stated as a
measure in Pranay Sethi. In his submission,
since the statutory instrument has been put
in place which affords more advantageous
treatment, the decision in Pranay Sethi
ought not to be considered to limit the
application of such statutory Rule."

13. The U.P. Rules,1998 are statutory
in nature and their operation is not stymied
by Pranay Sethi (supra). The U. P. Rules,
1998 have the force of law and shall apply
with full force in appropriate cases. The
U.P. Rules, 1998 are more beneficial for the
claimants than the provisions made in
Pranay Sethi (supra) for them. The
holdings in Pranay Sethi (supra) can not
dilute the advantages conferred by U.P.
Rules, 1998 upon the eligible beneficiaries.

14. In this wake, this Court finds that
the claimants/respondents are entitled to
20% enhancement in wages under the head
of future prospects as contemplated in the
UP Rules, 1998. The necessary changes in
the award shall be accordingly made.

VI c. Application of Split Multiplier:

15. The second issue raised by Shri
Sushil Kumar Mehrotra, learned counsel
for the appellant is that since the deceased
was on the verge of retirement, the
multiplier of 9 was wrongly applied. He
advocated use of a split multiplier by
placing reliance on the judgement rendered
by the Madras High Court in Divisional
Manager,
Royal
Sundaram
Alliance
Insurance Co. Ltd. Chennai Vs. Sarladevi
and Others7. The Madras High Court
evolving the concept of split multipliers
held as under:

"10. On a perusal of records, we
find that deceased was 58 years old at the
time of his death and he was left with only
two years of service. When that being so,
the Tribunal, while calculating the amount
under the head 'loss of income', ought to
have split up the multiplier into two parts
and ought to have made the calculation i.e
from the date of accident till the date of
retirement based on the actual salary and
for the remaining years, by fixing 50% of
the salary as notional loss of income.
Instead of doing so, the Tribunal adopted
the multiplier of 8 and made the calculation
based on the actual salary, which had
resulted in awarding an exorbitant sum of
Rs.36,58,248/- as total loss of dependancy.
Further we find that Tribunal while making
calculation under the head of loss of
dependancy, has deducted 1/4th amount
towards personal expenses of the deceased.
Hence, we hold that the method of
multiplier adopted by the Tribunal for
arriving at the compensation under 'loss of
dependancy' is not correct and the same has
to be modified by way of reassessment.

11. As per the judgment of
Hon'ble Apex Court reported in Sarla
Verma and others vs. Delhi Transport
Corporation and another (2009 (2) TN
MAC 1), the correct multiplier between the
age of 56 to 60 is 9. Therefore, multiplier
of 9 could be taken into consideration for
arriving at compensation to the case on
hand since the deceased was 58 years at the
time of his death. If the actual salary of
Rs.50,809/- is taken into consideration, the
annual loss of income works out to
Rs.6,09,708/-. 10% of the amount is liable
to be deducted towards income tax
deduction. 10% in the sum of Rs.6,09,708/-
comes to Rs.60,970.80 and the same can be
858 INDIAN LAW REPORTS ALLAHABAD SERIES
rounded off to Rs.61,000/-. If so, the
balance amount works out to Rs.5,48,708-
(Rs.6,09,708/- minus Rs.61,000/-), rounded
off to Rs.5,49,000/-. Hence, annual loss of
income could be fixed at Rs.5,49,000/-. For
the first two years, the loss of income
would be Rs.10,98,000/- (Rs.5,49,000/- x 2
years). For the balance seven years, only
50% annual income has to be taken into
consideration as notional income, which
comes to Rs.19,21,500/- (Rs.2,74,500/- x 7
years). Therefore, the total loss of income
works
out
to
Rs.30,19,500/-
(Rs.10,98,000/- + Rs19,21,500/-)."

16. However, application of split
multiplier method was discarded in no
certain terms in K.R. Madhusudhan v.
Administrative Officer8, by holding thus:

"14. In the appeal which was filed
by the appellants before the High Court, the
High Court instead of maintaining the
amount of compensation granted by the
Tribunal, reduced the same. In doing so, the
High Court had not given any reason. The
High Court introduced the concept of split
multiplier and departed from the multiplier
used by the Tribunal without disclosing any
reason therefor. The High Court has also
not considered the clear and corroborative
evidence about the prospect of future
increment of the deceased. When the age of
the deceased is between 51 and 55 years
the multiplier is 11, which is specified in
the 2nd column in the Second Schedule to
the Motor Vehicles Act, and the Tribunal
has not committed any error by accepting
the said multiplier. This Court also fails to
appreciate why the High Court chose to
apply the multiplier of 6.

15. We are, thus, of the opinion
that the judgment of the High Court
deserves to be set aside for it is perverse
and clearly contrary to the evidence on
record, for having not considered the
future prospects of the deceased and also
for adopting a split multiplier method."

 (emphasis supplied)

17. A similar view was taken by the
Supreme Court in Puttamma v. K.L.
Narayana Reddy9, by following K. R.
Madhusudhan
(supra),
referencing
provisions of the Motor Vehicles Act and
the judgement rendered by Supreme Court
in Sarla Verma (supra). In K. L.
Narayana Reddy (supra) it was noticed
that the Motor Vehicles Act, 1988 does not
envisage
application
of
the
a
split
multiplier and held thus:

"32.
For
determination
of
compensation in motor accident claims
under Section 166 this Court always
followed multiplier method. As there were
inconsistencies in the selection of a
multiplier, this Court in Sarla Verma [Sarla
Verma v. DTC, (2009) 6 SCC 121 : (2009)
2 SCC (Civ) 770 : (2009) 2 SCC (Cri)
1002] prepared a table for the selection of a
multiplier based on the age group of the
deceased/victim. The 1988 Act, does not
envisage application of a split multiplier.

34. We, therefore, hold that in
absence of any specific reason and
evidence on record the tribunal or the court
should not apply split multiplier in routine
course and should apply multiplier as per
decision of this Court in Sarla Verma
[Sarla Verma v. DTC, (2009) 6 SCC 121 :
(2009) 2 SCC (Civ) 770 : (2009) 2 SCC
(Cri) 1002] as affirmed in Reshma Kumari
[Reshma Kumari v. Madan Mohan, (2013)
9 SCC 65 : (2013) 4 SCC (Civ) 191 :
(2013) 3 SCC (Cri) 826] ."

18. The argument for applying a split
multiplier
is
misconceived
and
is
accordingly rejected. There was no error in
1 All. TATA A.I.G. General Insurance Co. Ltd. Parel Mumbai Vs. Amar Kaur & Ors.
859
the application of a multiplier of 9 by the
learned tribunal in the facts of this case, as
the deceased was 58 years of age.

VI d. Calculation of Conventional
Heads:

19. The amount determined under
conventional heads in the impugned award
is at variance with Pranay Sethi (supra).
The conventional heads were fixed in
Pranay Sethi (supra) by holding as under:

"54. ......The conventional and
traditional heads, needless to say, cannot be
determined on percentage basis because
that would not be an acceptable criterion.
Unlike determination of income, the said
heads
have
to
be
quantified.
Any
quantification must have a reasonable
foundation. There can be no dispute over
the fact that price index, fall in bank
interest, escalation of rates in many a field
have to be noticed. The court cannot remain
oblivious to the same. There has been a
thumb rule in this aspect. Otherwise, there
will be extreme difficulty in determination
of the same and unless the thumb rule is
applied, there will be immense variation
lacking any kind of consistency as a
consequence of which, the orders passed by
the tribunals and courts are likely to be
unguided. Therefore, we think it seemly to
fix reasonable sums. It seems to us that
reasonable figures on conventional heads,
namely, loss of estate, loss of consortium
and funeral expenses should be Rs.
15,000/-, Rs. 40,000/- funeral expenses
should be Rs. 15,000/-, Rs. 40,000/- And
Rs. 15,000/- respectively."

20. The figure under conventional
heads determined in Pranay Sethi (supra)
shall be applicable to the facts of this case.
The award is modified accordingly.

VI e. Interest

21. Interest of 7% and the manner of
payment decided by the learned tribunal is
just and lawful and does not call for
interference.

VII.
Determination
of
Compensation to which claimants are
entitled:

22. In wake of the preceding
discussion, the amount of compensation to
which the claimants are entitled and are
hereby awarded, is tabulated hereunder:

i. Date of Accident

-
26.08.2014

ii. Name of Deceased

 - Shri Kalicharan

iii. Age of the deceased

 - 58 years

iv. Occupation of the Deceased

 -
Supervisor
in
Agriculture
Department in Rajasthan

v. Income of the deceased

- 49,480/- per month

vi. Name, Age and Relationship
of Claimants with the deceased:

Sr. No.
Name
Age
Relation
1.
Amar Kaur
56
Wife
2.
Lokesh Kumar
25
Son

vii. Computation of Compensation

Sr.
No.
Heads
Amount (in Rupees)
1.
Monthly Income (A)
Rs. 49,480/-
2.
Annual Income (B)
(A x 12 = B)
Rs. 5,93,760/-
3.
Income Tax @ 10%
59,376/-

Yearly
Income
of
Deceased less tax
5,93,760-59,376
= 5,34,384/-
860 INDIAN LAW REPORTS ALLAHABAD SERIES
3.
Future Prospects (C)
20% of 5,34,384/-
= 1,06,876.80
4.
Annual Income + Future
Prospects
(B+C=D)
5,34,384 + 1,06,876.80
= 641,260.80
5.
Deduction
towards
personal expenses (E)
(1/3 of D)
1/3 of 641,260.80
= 213753.60-
6.
Annual
Loss
of
dependancy (F)
(D-E = F)
641,260.80-213753.60
= 4,27,507.20/-
7.
Multiplier (G)
9
8.
Total
loss
of
dependancy
(F x G)

4,27,507.20/- x 9
= 38,47,563/-
9.
Conventional Heads:
(a) Loss of consortium
(b) Loss of Estate
(c) Funeral Expenses
70,000/-
10.
Total compensation
39,17,563/-
11.
Interest
7%

VIII. Conclusion & Directions:

23. In view of the above, the appeal
filed by the Insurance Company viz. First
Appeal From Order No. - 2385 of 2017 is
dismissed.

24. The appeal filed by the claimant
viz. First Appeal From Order No.- 3211 of
2017 is partly allowed.

25. The amount of compensation to
which the claimants have been awarded
shall be deposited by the Insurance
Company within a period of three months
before the learned tribunal. Thereafter the
learned tribunal shall release the amount to
the claimants without delay. The amount
already disbursed to the claimants (if any)
shall be adjusted.

26. The amount deposited by the
Insurance Company before this Court shall
be transmitted to the learned trial court
which shall release the same in favour of
the claimants as part of the compensation
determined in this appeal.
----------
(2023) 1 ILRA 860
APPELLATE JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 16.11.2022

BEFORE

THE HON'BLE AJAY BHANOT, J.

First Appeal From Order No. 3227 of 2017

Mosaheb Ali ...Appellant
Versus
General Manager, U.P.S.R.T.C. & Anr.
 ...Respondents

Counsel for the Appellant:
Sri Brij Raj Singh. Sri Ajay Shyam Prajapati,
Sri Santosh Kumar Srivastava

Counsel for the Respondents:
Sri Anirudh Kumar Misra

Civil Law - Motor Vehicles Act, 1988,
Section - 168 - Constitution of India,
Article
21,
-
Disabilities
(Equal
Opportunity, Protection of Rights and
Full Participation) Act, 1995 - Appeal -
against award - quantum of compensation -
appellant sustained injuries in an accident
caused by the rash and negligent driving of
UPSRTC bus - tribunal partly allowed claim of
claimant-appellant
for
compensation
on
account of disability suffered by him -
assessment of damages and determining
compensation - in the light of judgments of
Hon'ble Apex Court in cases of Pappu Deo
Yadav's,
Kajal's,
Nirmala
Devi's,
R.D.
Hattangadi's, Raj Kumar's, K. Suresh's & Sarla
Verma's - impugned award is modified from
Rs. 1,52,067/- to Rs. 9,01,560/- with 7 %
interest - directions issued - Appeal allowed.
(Para - 16, 18, 20, 39, 40)

Appeal Allowed. (E-11)

List of Cases cited: