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Motor Vehicles Act, 1988 – Motor accident – Death of 36 year old man – Claim for compensation by his six dependants – Awarded by Tribunal – Enhanced by High Court – On appeal, held: Compensation further enhanced recalculating the same by increasing salary by 50% towards future prospects; deducting 30% towards taxes and 25% towards personal expenses and by applying multiplier of 15. Compensation – For motor accident – Deduction of 30% from the income of the deceased towards taxes – Propriety of – Held: If annual income is in taxable range, appropriate deduction towards taxes is proper. After death of a Sub-Inspector of Police aged 36 years, in a motor accident, six of his dependants made a claim for compensation. The Tribunal awarded compensation of Rs. 14,44,600/- with 9% interest p.a. after deducting one third from his gross monthly salary towards personal and living expenses, and by applying multiplier of 13. High Court on appeal enhanced the compensation to Rs. 14,65,776/-. It reached the amount by making addition to income towards future prospects, deducting therefrom 30% towards deduction from salary; by deducting one fourth of income towards personal expenses, and by applying multiplier of 13. The instant appeal was filed for enhancement of compensation contending that deduction of 30% towards taxes was not warranted and that the court should have applied multiplier of 16. =Allowing the appeal, the Court HELD: 1. Wherever the deceased is below 40 years of age and had a permanent job, the actual salary (less tax) should be increased by 50% towards future prospects, to arrive at the monthly income. Where the number of dependants of a deceased are in the range of 4 to 6, the deduction towards personal and living expenses of the deceased should be 25%. In regard to persons aged 36 to 40 years, the appropriate multiplier should be 15. Applying the said principles, compensation in the instant case is recalculated. The compensation is increased from Rs.14,66,600/- to Rs.19,70,250/-. The increased amount shall carry interest at the rate of 6% per annum from the date of claim petition to the date of payment. [Paras 6 and 9] [421-B-C; 422-E] Sarla Verma vs. Delhi Transport Corporation 2009 (6) SCC 121, relied on. 2. The deduction of 30% from the salary is correct. Where the annual income is in the taxable range, appropriate deduction should be made towards tax. In the instant case as the annual income has been worked out as Rs.2,48,292/-, appropriate deduction has to be made towards income-tax. The rate of income tax is a varying figure, with reference to taxable income after permissible deductions and the year of assessment. The High Court has rightly assessed the deduction as 30%. However, it is clarified 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. [Para 8] [421-H; 422-A-D] Sarla Verma vs. Delhi Transport Corporation 2009 (6) SCC 121, distinguished. Case Law Reference: 2009 (6) SCC 121 Relied on. Para 6 Distinguished. Para 8 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5316 of 2010. From the Judgment & Order daed 20.4.2007 of the HIgh Court of Delhi at New Delhi in F.A.O. No. 250 of 2003. R.K. Khanna for the Appellant. A.K. Raina, Dr. Kailash Chand for the Respondent.
IN THE SUPREME COURT OF INDIA Reportable CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 5316 OF 2010 (Arising out of SLP (C) No.668/2008) Shyamwati Sharma & Ors. … Appellants Vs. Karam Singh & Ors. … Respondents JUDGMENT R. V. RAVEENDRAN J., Leave granted. 2. This is an appeal for enhancement of compensation, by the mother, widow, … Continue reading
Motor Vehicles Act, 1988 – Motor accident – Death of 36 year old man – Claim for compensation by his six dependants – Awarded by Tribunal – Enhanced by High Court – On appeal, held: Compensation further enhanced recalculating the same by increasing salary by 50% towards future prospects; deducting 30% towards taxes and 25% towards personal expenses and by applying multiplier of 15. Compensation – For motor accident – Deduction of 30% from the income of the deceased towards taxes – Propriety of – Held: If annual income is in taxable range, appropriate deduction towards taxes is proper. After death of a Sub-Inspector of Police aged 36 years, in a motor accident, six of his dependants made a claim for compensation. The Tribunal awarded compensation of Rs. 14,44,600/- with 9% interest p.a. after deducting one third from his gross monthly salary towards personal and living expenses, and by applying multiplier of 13. High Court on appeal enhanced the compensation to Rs. 14,65,776/-. It reached the amount by making addition to income towards future prospects, deducting therefrom 30% towards deduction from salary; by deducting one fourth of income towards personal expenses, and by applying multiplier of 13. The instant appeal was filed for enhancement of compensation contending that deduction of 30% towards taxes was not warranted and that the court should have applied multiplier of 16. =Allowing the appeal, the Court HELD: 1. Wherever the deceased is below 40 years of age and had a permanent job, the actual salary (less tax) should be increased by 50% towards future prospects, to arrive at the monthly income. Where the number of dependants of a deceased are in the range of 4 to 6, the deduction towards personal and living expenses of the deceased should be 25%. In regard to persons aged 36 to 40 years, the appropriate multiplier should be 15. Applying the said principles, compensation in the instant case is recalculated. The compensation is increased from Rs.14,66,600/- to Rs.19,70,250/-. The increased amount shall carry interest at the rate of 6% per annum from the date of claim petition to the date of payment. [Paras 6 and 9] [421-B-C; 422-E] Sarla Verma vs. Delhi Transport Corporation 2009 (6) SCC 121, relied on. 2. The deduction of 30% from the salary is correct. Where the annual income is in the taxable range, appropriate deduction should be made towards tax. In the instant case as the annual income has been worked out as Rs.2,48,292/-, appropriate deduction has to be made towards income-tax. The rate of income tax is a varying figure, with reference to taxable income after permissible deductions and the year of assessment. The High Court has rightly assessed the deduction as 30%. However, it is clarified 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. [Para 8] [421-H; 422-A-D] Sarla Verma vs. Delhi Transport Corporation 2009 (6) SCC 121, distinguished. Case Law Reference: 2009 (6) SCC 121 Relied on. Para 6 Distinguished. Para 8 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 5316 of 2010. From the Judgment & Order daed 20.4.2007 of the HIgh Court of Delhi at New Delhi in F.A.O. No. 250 of 2003. R.K. Khanna for the Appellant. A.K. Raina, Dr. Kailash Chand for the Respondent.
IN THE SUPREME COURT OF INDIA Reportable CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 5316 OF 2010 (Arising out of SLP (C) No.668/2008) Shyamwati Sharma & Ors. … Appellants Vs. Karam Singh & Ors. … Respondents JUDGMENT R. V. RAVEENDRAN J., Leave granted. 2. This is an appeal for enhancement of compensation, by the mother, widow, … Continue reading
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