Delve into the nuanced legal analysis of income assessment for compensation in a case involving a fatality with multiple income sources. The court’s meticulous examination of the deceased’s varied sources of income provides insight into the factors considered in determining a fair and reasonable compensation for the dependents left behind. Stay tuned to unravel the intricacies of this legal judgment.
Facts
- Ravisankar, aged 52, met with an accident on 09.12.2012 while driving a TVS Starcity insured with respondent No 1-Insurance Company.
- He was an agriculturist, running a dairy farm, and a Government contractor, with an annual income of ₹6,00,000 from the contractor work.
- He supplied milk and coconuts to a school and received ₹8,52,447 from that during a 14-month period.
- He also earned ₹16,36,398 from the sale of bananas and ₹7,29,900 from growing paddy on his land.
- The High Court had reduced the deceased’s income from ₹50,000 to ₹20,000 per month, which was contested by the appellants.
- The main issue raised in the appeal was the deceased’s income for calculating compensation.
- Interest at 8% per annum was awarded and not disturbed by the Tribunal or High Court.
- The judgment of the High Court reducing the compensation awarded by the Tribunal led to the present appeal by the Insurance Company.
- High Court reduced the income of the deceased from ₹ 50,000/- to ₹ 20,000/- per month based on the contentions raised by the Insurance Company
- Tribunal had originally assessed the income at ₹ 50,000/- per month, taking a conservative view of the matter
- Tribunal awarded ₹ 15,000/- towards loss of estate, ₹ 40,000/- towards loss of consortium, and ₹ 15,000/- for funeral expenses
- Total compensation assessed by the Tribunal was ₹ 51,64,550/-
- After adjustments for future prospects, personal expenses, and applying a multiplier, loss of income was assessed at ₹ 22,48,000/-
- Sole earning member of the family had died leaving four dependants, leading to the assessment of total compensation at ₹ 51,04,550/-
- The value of life cannot be entirely assessed but the appellants felt satisfied with the Tribunal’s awarded amount
- Prayer made to set aside the High Court judgment and restore the Tribunal’s decision
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Arguments
- The appellants made unimaginable claims.
- The land on which bananas were being grown is still in use by the family for the same purpose.
- There is no actual loss of income from the land.
- The Insurance Company argued against the validity of the appellants’ claims.
- Total receipts from supply of milk and coconuts to the school cannot be said to be the income.
- The appeal deserves to be dismissed.
- There is no clinching evidence on record to show that the deceased was working as a Government contractor regularly and the income was being generated therefrom.
- The High Court had taken a reasonable view as compensation to be awarded to the dependants of a deceased has to be just and reasonable and not the kind of bonanza.
- There is no error in the judgment of the High Court.
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Analysis
- Deceased was a government contractor and earned ₹ 23,66,298 from this work.
- Deceased had additional income from supplying milk and coconuts to a school, earning ₹ 8,52,447 in 14 months.
- He also received ₹ 22,23,553 from a works contract with Tirunelveli Municipal Corporation.
- Deceased did not pay income tax of ₹ 1,48,598 for the year 2010-11.
- High Court assessed his income at ₹ 20,000 per month, split between milk supply (₹ 8,000), agriculture (₹ 5,000), and contracting (₹ 7,000).
- Deceased had 07 acres and 47 cents of land out of the family’s total 27 acres and 78 cents.
- His death likely impacted the income from the land, as he was the sole caretaker.
- The overall assessment of compensation must consider his multifaceted income sources.
- Income Tax Officer Kalayana Sundram testified on the deceased’s income.
- The income of the deceased can be reasonably assessed at ₹35,000 per month
- This assessment is based on the material placed on record by the appellants
- The value of the labour put in by the deceased in agriculture was considered in the assessment
- The applicable multiplier for compensation is 11 as per previous judgments
- The compensation amount is calculated based on the deceased’s monthly dependency, future prospects, and personal expenses deduction
- The total compensation amount is calculated to be Rs. 38,81,500/-
- Additional compensations include loss of estate, funeral expenses, and loss of consortium
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Decision
- Appellants entitled to compensation of ₹38,81,500/- with interest @8% from the date of filing of the claim petition till realization.
- Judgment of the High Court modified accordingly.
- Appeal stands disposed of.
Case Title: VETHAMBAL Vs. THE ORIENTAL INSURANCE COMPANY (2024 INSC 180)
Case Number: C.A. No.-003482-003482 / 2024
