Company Limited v. Pranay Sethi and others

judgement of this Court passed in First Appeal From Order No.2974 of 2017 ( Smt. Munni Devi and others Vs. Heera Lal and others ) decided on 23.02.2021 wherein an accident occurred on 14.03.2016 when the deceased was going to his home from another place, he was hit by a Tractor and died on the spot. The deceased was considered to be 19 years of age. Learned Tribunal has cited various authorities like Laxmi Devi and others Vs. Mohd. Tambar and others, 2008 (2) T.A.C. 394 (SC), Munna Lal Jain and others Vs. Bipin Kumar Sharma and others, 2015 (3) T.A.C. (SC) , Rajesh and others Vs. Rajveer Singh and others , 2013 ACJ 1403, Sarla Verma Vs. Delhi Transport Corporation (2009) 6 SCC 121 and Pranay Sethi and others ( Supra), Kirti Vs. Oriental Insurance Co. Limited, 2021 (1) TAC (1) S.C. , Anita Sharma and others Vs. New India Assurance Co. Ltd. and another (2021) 1 SCC 171, United India Insurance Co. Ltd. Vs. Satinder Kaur @ Satwinder Kaur, 2020 (0) AIJEL-SC 66336, Magma General Insurance Co. Ltd. Vs. Nanu Ram Alias Chuhru Ram & Ors (2018) 3 FAFO No. 1014 of 2016 18 SCC 130 held that as far addition of future prospects is concerned, it would be 40% in view of the decision of the Apex Court in Pranay Sethi (Supra) as the deceased was below 40 years of age and was engaged in Carpentory work. Learned counsel for the appellant submits that in the present case the monthly income of the deceased should be reduced to 6,000/- as there was no basis to hold that the deceased earns Rs. 300/- per day on the date of accidental death. Per contra, learned counsel for the respondents submits that according to Pranay Sethi (Supra), the multiplier of 17 was applicable but as per guidelines of Supreme Court in Sarla Verma (supra) the same could be a multiplier of 16 . He next submitted that learned Tribunal has committed no error while assessing the notional income of the deceased in the year 2015 as Rs.9,000/- monthly income and Rs.1,08,000/- per annum. He also submitted that learned Tribunal has not added future prospects while ascertaining the quantum of compensation in the annual income of the deceased which was mandatory in terms of judgment of Hon'ble Supreme Court in the case of Pranay Sethi (Supra) Learned counsel for the respondents has placed reliance on judgment of this Court passed in First Appeal From Order No.613 of 2019 ( New India Assurance Co. Ltd. Vs. Anil Kmar and others) wherein accidental death of Smt. Suneeta on 01.11.2016 while she being the Pillion rider was traveling alongwith her husband on his motorcycle which was hit by an offending truck. This Court has considered many decisions pertaining to the claim petition regarding monthly income of the deceased who was home maker and was said to be running a tea stall and her future prospects. as well. This Court has observed in paras 41 to 46 as under:- "41. Applying the dictum of the aforesaid decisions in context with the facts and the evidence on record of the instant case, this Court is of the clear opinion that the Tribunal erred in taking Rs. 3,000/- per month as notional income as this Court finds that the fact regarding earning 4 FAFO No. 1014 of 2016 through a Tea Stall was clearly established by the evidence of the witnesses who were cross-examined but nothing adverse could be elicited from the testimony to cast a doubt over their depositions. However, even if the notional income in case of a homemaker was to be assessed and noticing that the accident occurred in the year 2016 even then a sum of Rs. 6,000/- per month was a better figure to adopt as the base as in the case of Rajendra Singh (supra) wherein the Apex Court also took the notional income in case of a homemaker at Rs. 6,000/- also related to an accident which occurred in the year 2012.

42. Assessing the overall situation in a holistic fashion with a moderate approach this Court finds that the notional income of the deceased should have been safely taken at Rs. 5,000/- per month. The claimants were also entitled for providing future prospects at the rate of 25%. It is true that even in case where notional income is assessed the Tribunal is required to make adjustments for the personal expenses and in this case where there were three dependents, accordingly, 1/3rd ought to have been deducted.

43. To this extent, the submission of learned counsel for the Insurance Company is justified and this Court too finds that the Tribunal erred in not making deductions for the personal expenses despite the same the Tribunal awarded a sum of Rs. 70,000/- towards the head for consortium, loss of estate and funeral expenses and finally granted a total sum of Rs. 7,45,000/- to the claimants.

44. However, if this Court computes the compensation taking Rs. 5,000/- per month as income (income from the Tea Stall and computation as a homemaker, of the deceased) and adding 25% towards the future prospects which would be Rs. 1,250/- per month would make the income @ Rs. 6,250/- per month. From this, if 1/3rd is deducted towards the personal expenses and rounding it off to Rs. 2, 100/- per month, then the net income would be [Rs. 6,250-2,100] Rs. 4,150/- per month. Adopting a multiplier of 15 as per decision of the Apex Court in Sarla Verma (supra), the compensation amount would be Rs. 7,47,000/- to which the amount towards consortium and loss of estate and funeral expenses, if added at Rs. 70,000/-, would finally rest the award at 8,17,000/-. 5 FAFO No. 1014 of 2016

45. Once again if it is recapitulated, it would be found that the Tribunal without making deduction for personal expenses yet awarded a sum of Rs. 7,45,000/-. If deduction would have been made then the amount of the Tribunal would get de-escalated to around Rs. 5,20,000/-. On the other hand upon re-computation on the enhanced income, the amount determined is Rs. 8,17,000/-.

46. Now, this Court is poised to determine the delicate task of assessing the just and fair compensation. Whether mathematical calculations should be preferred or considering the facts and overall circumstances including the evidence and adopting the correct and settled methodology with a pragmatic and realistic approach and also keeping in mind that the difference between the amount already awarded and which could be awarded is only about Rs. 72,000/- Whereas the respondents did not seek enhancement of the award and upon accepting the contention of the appellant and at the given base income adopted by the Tribunal and if deduction is made the amount would be hugely disproportionate" Learned counsel for the respondents lastly submitted that Rs.6000/- monthly income of the deceased was assessed by this Court in respect of accident that took place in the year 2013; even if it is admitted after a gap of two years it should get some enhancement due to lapse of two years. Considering the aforesaid judicial precedent, an overall view emerges that the accidental death of the deceased Rahul Singh occurred on 13/02/2015, and the witnesses had deposed that he was operating a grocery shop. However, neither any registration of the said shop under the Shops & Establishment Act has been produced during evidence nor any specific income of the deceased has been proved by the said shop or income derived from animal husbandry, the monthly income of the deceased is fixed as Rupees 6,000. Consequently, the compensation is hereby calculated in the following manner: A. Monthly income of deceased: Rupees 6,000. B. Annual income of deceased: Rupees 72,000. 6 FAFO No. 1014 of 2016 C. Taking into consideration the number of dependents of the deceased, one-third of the annual income will be deducted towards live expenses of the deceased: Rupees 72,000 - 24,000 = 48,000/-. D. In his age group of deceased which is proved as 35 years by oral evidence, a multiplier of 17 would be applicable in his age group: Rs. 48,000 X 16 = Rs.7,60,000/-. Thus, the loss of dependency comes out to Rs. 8,16,000/- E. According to the judgment of the Supreme Court in Pranay Sethi (supra) , the deceased being self-employed, 40% will be added to the above amount as a future prospect.Therefore, the compensation payable to the petitioner comes to Rs.10,75,200/-.In this amount, Rs.15,000/- will be added as loss of estate, Rupees 40,000/- as loss of spouse consortium, and Rs. 50,000/- as funeral expenses. As the mother of the deceased, Madhumati Devi, died during the pendency of the present appeal, the filial consortium payable to her in the impugned judgment is quashed, but the minor son of the deceased, and petitioner no.1, Srimati Mamta Singh, will be given Rs 40,000/- as parental consortium due to the loss of love and affection of his father, as he was then of a tender age of 8 years. The total compensation after adding all is worked out as Rupees 11,85,200/-. It is noteworthy that the above modified calculation has been made in light of the Constitution Bench of the Hon'ble apex court in the case of National Insurance Company Limited Vs. Pranay Sethi and others, (2017) 16 SCC 680. Consequently, the appeal is partly allowed. The total amount of compensation payable to the petitioner is reduced from Rs.13,84,000/- as directed in the impugned judgment and order to Rs. 11,85,200/- in the above manner. It is further directed that, out of this amount, Rs. 11,85,200/- Smt. Mamta Singh wife of the deceased will receive Rs.8,00,000/-, out of which, Rs.4,00,000/- will be deposited in some FDR scheme in nationalized bank for a period of three years and the remaining Rs. 4,00,000/- will be 7 FAFO No. 1014 of 2016 payable to her through an account payee check or transfer in her account through RTGS to the description of the Tribunal. Petitioner no.2 Aush Singh is minor son of petitioner no.1 will receive Rs.3,85,200/- as compensation, which will be deposited in a National Bank in an FDR scheme, initially for a period of three years and it will be renewable until attainment of his majority, as directed by the impugned judgment and order. The appellant, who is opposite party no.3 before the tribunal in the claim case, the appellant will deposit the entire amount, as compensation, as per the modified order of this court, within two months and thereafter the amount will be disbursed to the petitioners as stated above. The appeal stands partly allowed in the above manner. November 14, 2025 dk/ (Ram Manohar Narayan Mishra,J.) DEVENDRA KUMAR High Court of Judicature at Allahabad, Lucknow Bench

judgement of this Court passed in First Appeal From Order No.2974 of 2017 ( Smt. Munni Devi and others Vs. Heera Lal and others ) decided on 23.02.2021 wherein an accident occurred on 14.03.2016 when the deceased was going to his home from another place, he was hit by a Tractor and died on the spot. The deceased was considered to be 19 years of age. Learned Tribunal has cited various authorities like Laxmi Devi and others Vs. Mohd. Tambar and others, 2008 (2) T.A.C. 394 (SC), Munna Lal Jain and others Vs. Bipin Kumar Sharma and others, 2015 (3) T.A.C. (SC) , Rajesh and others Vs. Rajveer Singh and others , 2013 ACJ 1403, Sarla Verma Vs. Delhi Transport Corporation (2009) 6 SCC 121 and Pranay Sethi and others ( Supra), Kirti Vs. Oriental Insurance Co. Limited, 2021 (1) TAC (1) S.C. , Anita Sharma and others Vs. New India Assurance Co. Ltd. and another (2021) 1 SCC 171, United India Insurance Co. Ltd. Vs. Satinder Kaur @ Satwinder Kaur, 2020 (0) AIJEL-SC 66336, Magma General Insurance Co. Ltd. Vs. Nanu Ram Alias Chuhru Ram & Ors (2018) 3 FAFO No. 1014 of 2016 18 SCC 130 held that as far addition of future prospects is concerned, it would be 40% in view of the decision of the Apex Court in Pranay Sethi (Supra) as the deceased was below 40 years of age and was engaged in Carpentory work. Learned counsel for the appellant submits that in the present case the monthly income of the deceased should be reduced to 6,000/- as there was no basis to hold that the deceased earns Rs. 300/- per day on the date of accidental death. Per contra, learned counsel for the respondents submits that according to Pranay Sethi (Supra), the multiplier of 17 was applicable but as per guidelines of Supreme Court in Sarla Verma (supra) the same could be a multiplier of 16 . He next submitted that learned Tribunal has committed no error while assessing the notional income of the deceased in the year 2015 as Rs.9,000/- monthly income and Rs.1,08,000/- per annum. He also submitted that learned Tribunal has not added future prospects while ascertaining the quantum of compensation in the annual income of the deceased which was mandatory in terms of judgment of Hon'ble Supreme Court in the case of Pranay Sethi (Supra) Learned counsel for the respondents has placed reliance on judgment of this Court passed in First Appeal From Order No.613 of 2019 ( New India Assurance Co. Ltd. Vs. Anil Kmar and others) wherein accidental death of Smt. Suneeta on 01.11.2016 while she being the Pillion rider was traveling alongwith her husband on his motorcycle which was hit by an offending truck. This Court has considered many decisions pertaining to the claim petition regarding monthly income of the deceased who was home maker and was said to be running a tea stall and her future prospects. as well. This Court has observed in paras 41 to 46 as under:- "41. Applying the dictum of the aforesaid decisions in context with the facts and the evidence on record of the instant case, this Court is of the clear opinion that the Tribunal erred in taking Rs. 3,000/- per month as notional income as this Court finds that the fact regarding earning 4 FAFO No. 1014 of 2016 through a Tea Stall was clearly established by the evidence of the witnesses who were cross-examined but nothing adverse could be elicited from the testimony to cast a doubt over their depositions. However, even if the notional income in case of a homemaker was to be assessed and noticing that the accident occurred in the year 2016 even then a sum of Rs. 6,000/- per month was a better figure to adopt as the base as in the case of Rajendra Singh (supra) wherein the Apex Court also took the notional income in case of a homemaker at Rs. 6,000/- also related to an accident which occurred in the year 2012.

42. Assessing the overall situation in a holistic fashion with a moderate approach this Court finds that the notional income of the deceased should have been safely taken at Rs. 5,000/- per month. The claimants were also entitled for providing future prospects at the rate of 25%. It is true that even in case where notional income is assessed the Tribunal is required to make adjustments for the personal expenses and in this case where there were three dependents, accordingly, 1/3rd ought to have been deducted.

43. To this extent, the submission of learned counsel for the Insurance Company is justified and this Court too finds that the Tribunal erred in not making deductions for the personal expenses despite the same the Tribunal awarded a sum of Rs. 70,000/- towards the head for consortium, loss of estate and funeral expenses and finally granted a total sum of Rs. 7,45,000/- to the claimants.

44. However, if this Court computes the compensation taking Rs. 5,000/- per month as income (income from the Tea Stall and computation as a homemaker, of the deceased) and adding 25% towards the future prospects which would be Rs. 1,250/- per month would make the income @ Rs. 6,250/- per month. From this, if 1/3rd is deducted towards the personal expenses and rounding it off to Rs. 2, 100/- per month, then the net income would be [Rs. 6,250-2,100] Rs. 4,150/- per month. Adopting a multiplier of 15 as per decision of the Apex Court in Sarla Verma (supra), the compensation amount would be Rs. 7,47,000/- to which the amount towards consortium and loss of estate and funeral expenses, if added at Rs. 70,000/-, would finally rest the award at 8,17,000/-. 5 FAFO No. 1014 of 2016

45. Once again if it is recapitulated, it would be found that the Tribunal without making deduction for personal expenses yet awarded a sum of Rs. 7,45,000/-. If deduction would have been made then the amount of the Tribunal would get de-escalated to around Rs. 5,20,000/-. On the other hand upon re-computation on the enhanced income, the amount determined is Rs. 8,17,000/-.

46. Now, this Court is poised to determine the delicate task of assessing the just and fair compensation. Whether mathematical calculations should be preferred or considering the facts and overall circumstances including the evidence and adopting the correct and settled methodology with a pragmatic and realistic approach and also keeping in mind that the difference between the amount already awarded and which could be awarded is only about Rs. 72,000/- Whereas the respondents did not seek enhancement of the award and upon accepting the contention of the appellant and at the given base income adopted by the Tribunal and if deduction is made the amount would be hugely disproportionate" Learned counsel for the respondents lastly submitted that Rs.6000/- monthly income of the deceased was assessed by this Court in respect of accident that took place in the year 2013; even if it is admitted after a gap of two years it should get some enhancement due to lapse of two years. Considering the aforesaid judicial precedent, an overall view emerges that the accidental death of the deceased Rahul Singh occurred on 13/02/2015, and the witnesses had deposed that he was operating a grocery shop. However, neither any registration of the said shop under the Shops & Establishment Act has been produced during evidence nor any specific income of the deceased has been proved by the said shop or income derived from animal husbandry, the monthly income of the deceased is fixed as Rupees 6,000. Consequently, the compensation is hereby calculated in the following manner: A. Monthly income of deceased: Rupees 6,000. B. Annual income of deceased: Rupees 72,000. 6 FAFO No. 1014 of 2016 C. Taking into consideration the number of dependents of the deceased, one-third of the annual income will be deducted towards live expenses of the deceased: Rupees 72,000 - 24,000 = 48,000/-. D. In his age group of deceased which is proved as 35 years by oral evidence, a multiplier of 17 would be applicable in his age group: Rs. 48,000 X 16 = Rs.7,60,000/-. Thus, the loss of dependency comes out to Rs. 8,16,000/- E. According to the judgment of the Supreme Court in Pranay Sethi (supra) , the deceased being self-employed, 40% will be added to the above amount as a future prospect.Therefore, the compensation payable to the petitioner comes to Rs.10,75,200/-.In this amount, Rs.15,000/- will be added as loss of estate, Rupees 40,000/- as loss of spouse consortium, and Rs. 50,000/- as funeral expenses. As the mother of the deceased, Madhumati Devi, died during the pendency of the present appeal, the filial consortium payable to her in the impugned judgment is quashed, but the minor son of the deceased, and petitioner no.1, Srimati Mamta Singh, will be given Rs 40,000/- as parental consortium due to the loss of love and affection of his father, as he was then of a tender age of 8 years. The total compensation after adding all is worked out as Rupees 11,85,200/-. It is noteworthy that the above modified calculation has been made in light of the Constitution Bench of the Hon'ble apex court in the case of National Insurance Company Limited Vs. Pranay Sethi and others, (2017) 16 SCC 680. Consequently, the appeal is partly allowed. The total amount of compensation payable to the petitioner is reduced from Rs.13,84,000/- as directed in the impugned judgment and order to Rs. 11,85,200/- in the above manner. It is further directed that, out of this amount, Rs. 11,85,200/- Smt. Mamta Singh wife of the deceased will receive Rs.8,00,000/-, out of which, Rs.4,00,000/- will be deposited in some FDR scheme in nationalized bank for a period of three years and the remaining Rs. 4,00,000/- will be 7 FAFO No. 1014 of 2016 payable to her through an account payee check or transfer in her account through RTGS to the description of the Tribunal. Petitioner no.2 Aush Singh is minor son of petitioner no.1 will receive Rs.3,85,200/- as compensation, which will be deposited in a National Bank in an FDR scheme, initially for a period of three years and it will be renewable until attainment of his majority, as directed by the impugned judgment and order. The appellant, who is opposite party no.3 before the tribunal in the claim case, the appellant will deposit the entire amount, as compensation, as per the modified order of this court, within two months and thereafter the amount will be disbursed to the petitioners as stated above. The appeal stands partly allowed in the above manner. November 14, 2025 dk/ (Ram Manohar Narayan Mishra,J.) DEVENDRA KUMAR High Court of Judicature at Allahabad, Lucknow Bench