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     REPORTABLE                

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOS.11011­11012 OF 2017

Vijay Kumar Rastogi …. Appellant                          

Versus

Uttar Pradesh State Roadways  Transport Corporation ….Respondent  

J U D G M E N T

A.M. Khanwilkar, J.

1. The present appeals take exception to the  judgment of

the High Court of Delhi in MAC Appeal No.393/2009 dated 6th

December, 2016, whereby the High Court declined to enhance

the  compensation  amount  awarded to the  appellant  by the

Motor Accident Claims Tribunal and to the order dated 18th

January, 2017 dismissing the Review Petition No.20 of 2017.

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2. The Motor Accident Claims Tribunal (for short, “the

Tribunal”) vide order dated 4th  April, 2009, awarded

compensation to the  appellant  and  his father­in­law  to the

tune of Rs.5,59,584/­ and Rs.4,53,131/­, respectively, against

which four appeals were filed before the High Court, one each

by the appellant and his father­in­law and two cross appeals

by the respondent, all of which were disposed of by the

impugned judgment. The appellant alone has assailed the

impugned judgment and prays for grant of enhanced

compensation amount.   3. As can be gleaned from the claim petition, the appellant

and his father­in­law suffered serious injuries on 26th

January, 2005, when their car was hit by bus no. UP­25­G­

9132, owned by the respondent and being rashly and

negligently driven by one Alam Beg. The extent of the injuries

caused to the appellant included haemorrhage, multiple cuts,

bruises  and  fractures  all  over the  body and post traumatic

optic neuropathy. The appellant was treated at several

hospitals and operated upon but suffered disability of 25%. He

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then filed a claim petition in the Tribunal, Karkardooma,

Delhi, against the driver of bus no. UP­25­G­9132, Alam Beg,

and the respondent on 27th January, 2006.

4. Ultimately, the Tribunal, vide order dated 4th April, 2009,

inter  alia  held that  bus  No.  UP­25­G­9132 was rashly  and

negligently driven by the driver,  Alam Beg, and accordingly,

awarded the appellant  with compensation of Rs.5,59,584/­

along with interest at 7% p.a. under the following heads:

“23. Keeping in view all the relevant factors, principles of law  laid down in above mentioned cases and evidence on record, I  am of the view that the petitioner is entitled for compensation  as per following details:

1. Cost of medicines :Rs.1,08,883.00 2. Cost of future treatment :Rs.   25,000.00 3. Loss of Income :Rs.   40,802.00 4. Loss of future income :Rs.1,78,044.00 5. Loss of income for 15 days :Rs.     1,854.62 6. Loss of enjoyment of life & Limb etc. :Rs.1,00,000.00 7. Pain and Sufferings :Rs.   50,000.00 8. Compensation for attendant :Rs.   20,000.00 9. Special Diet :Rs.   20,000.00 10. Conveyance :Rs.   15,000.00

Total :Rs.5,59,583.62

or say :Rs.5,59,584.00”

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5. Be it noted that the Tribunal in paragraph 17 of its

judgment has adverted to Ext. PW­6/F, which reveals the date

of birth of the appellant as 7­11­1969 and on that basis, has

recorded a finding that on the date of accident on 26th June,

2005, the appellant was 36 years of age. Further, the Tribunal

in paragraph 16 of its judgment has taken note of the fact that

the appellant on the date of accident was working as Medical

Representative with M/s. Stadmed Private Ltd., and after the

accident he could not perform his duty because he remained

confined to bed.

6. The Tribunal, while recording that the appellant earned a

sum of Rs.50,556/­ from ‘other sources’ namely bank interest

and commission,  over and above his salary, did not consider

the said income on the ground that commission and interest

could not be considered for computation of loss of income. The

appellant  had annexed  his income  tax returns for the  year

2004­05 as proof that  his taxable income was considerably

higher than the amount considered by the Tribunal, as given

hereunder:

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“STATEMENT OF INCOME

NAME OF ASSESSEE Vijay Kumar Rastogi FATHER’S NAME  Sh. Nand Kishore Rastogi DATE OF BIRTH  7th Nov. 1969 ADDRESS    OFFICE       Stadmed Private Limited

138­B, Moahammed Pur, New Delhi – 110066

           RESIDENCE   C­40, ZI, Dilshad Garden,                               Delhi – 110095 STATUS  :  Individual RESIDENTIAL STATUS  :  Resident & Ordinarily  

  Resident in India  PA NUMBER STATUS  :  AEYPR8620R PREVIOUS YEAR ENDED ON:  31ST MARCH 2004 ASSESSMENT  :  2004­2005

COMPUTATION OF TAXABLE INCOME Income From Salary  Gross receipt from salary as per  Salary certificate   66,766.50

Less: Standard deduction u/s16(i)   22,225.50        44,511.00

Income from Business or Profession Income as per Income and  Expenditure  Account  99,805.00 Less: Income not covered under the           said head            Income from Salaries  66,766.50          Income from other sources  50,556.50

(17,518.00) Income from other sources  Bank Interest                  72.00 Commission  50,454.00                   50,556.50 Gross Total income  77,549.50

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Less: Exemption U/S 80L  Bank interest                                          72.00 Gross Total income  77,477.50 Income Rounded off  77,480.00 Income Tax Due on Rs. 77480/­ 4,496.00 Less: Deduction U/s 88 EPF contribution  6,491.00 LIP Paid           13,225.00                                              19,716.00

Amount allowed @ 20%  3,943.00 Tax Due               553.00 Tax Paid               553.00 Balance Payable/Receivable    NIL

(VIJAY KUMAR RASTOGI)”

7. Aggrieved by the Tribunal’s award, the appellant filed an

appeal before the High Court, alleging that while passing the

award, the Tribunal had erroneously calculated his income as

Rs. 44,511/­ per annum, disregarding his income from other

sources and also reducing the actual  income earned by the

appellant by following the standard deduction method. In the

impugned judgment, the High Court while recording that the

appellant’s taxable  income was Rs.77,480/­  less tax paid of

Rs.4496/­,  and while  accepting that the  accident  had been

caused by the rash driving of the bus driver, Alam Beg and

that the appellant had in no way contributed to the causing of

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the accident, only enhanced the rate of interest on the

compensation awarded from 7% to 9% as it felt that the rate of

interest awarded was on the lower side but it did not enhance

the compensation itself, on the ground that no case had been

made out for enhancement. The appellant challenged the

aforesaid judgment by way of a review petition, which was also

dismissed.

8. The  short  point  which  arises for our consideration is:

whether the High Court committed  manifest error by not

considering other sources of income of the appellant including

compensation  of  Rs.80,000/­  on  account  of  damage to the

Maruti car of the appellant while upholding the compensation

awarded by the Tribunal?  

9. We have heard Ms. Rekha Rastogi,  learned counsel for

the appellant as also Ms. Garima Prashad, learned counsel  for

the respondent.

10. The principal issue that needs to be addressed in these

appeals is about the denial of claim in reference to commission

and interest amounts earned by the appellant during the

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relevant period, as disclosed in the Income Tax Return filed by

the appellant. The appellant claimed income from other

sources under two heads,  namely,  Bank  Interest :  Rs.72/­;

and  Commission :  Rs.50,454/­. The  Tribunal opined that

commission and interest cannot be considered for

computation of loss of income and confined the claim of the

appellant only on the basis of  his net annual salary income to

Rs.44,511/­. The Tribunal noted that the appellant did not file

any document of his age, educational qualification or

profession. The High Court, on the other hand, in paragraph

11 of the impugned judgment observed thus:  

“11.  Regarding the deduction of tax paid  from the net income of injured – Vijay Kumar Rastogi is concerned, I find that the total income of injured – Vijay Kumar Rastogi as per the tax return (Ex.PW­6/F) is Rs.77477.50 and after deduction of tax of Rs.4,496/­ the net income has been rightly taken into consideration by the learned Motor  Accident  Claims  Tribunal.  The  disability  of  25% suffered by injured Vijay Kumar Rastogi has been rightly taken to be the functional disability  while keeping in view that the injured – Vijay Kumar Rastogi was working as the Medical Representative. No case for enhancement of compensation while taking the gross income of injured – Vijay Kumar Rastogi is made out, as net income has to

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be taken into consideration while assessing the compensation in such cases. Regarding the application of multiplier  of  15  is  concerned, I  do find that  in case of injured  Vijay  Kumar  Rastogi  multiplier of  15 ought to have been adopted but by adoption of multiplier of 16, the difference in the compensation worked out is marginal and the same is set off by the fact that future prospects of injured Vijay Kumar Rastogi has not been taken into consideration and therefore, this Court is not inclined to interfere with the awarded compensation on this account.”   

11. Strikingly, the High Court noted the taxable income

disclosed in tax return of the appellant for the relevant period

as Rs.77,480/­ (rounded off) and tax deduction of Rs.4,496/­,

yet proceeded to hold that the net income of the appellant has

been  rightly taken  into  consideration  by the  Tribunal. It is

unfathomable that the  High Court,  despite  having  accepted

the claim of the appellant founded on his tax return for the

relevant period, disclosing the taxable income of the appellant

as Rs.77,480/­ (rounded off) and deduction of tax of

Rs.4,496/­, could have affirmed the conclusion of the Tribunal

that the net annual income of the appellant was Rs.44,511/­.

It ought to have reckoned the taxable income for computing

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the head towards loss of income. This, in our opinion, is the

manifest error committed by the High Court. The appellant is

justified in relying upon the decisions of this Court which have

taken the view that loss of taxable earning should be reckoned

for the purpose of determining just compensation as

enunciated in  National Insurance Co. Ltd. Vs. Indira

Srivastava and Ors.1, which has been followed in  Oriental

Insurance Company Limited Vs. Jashuben and Ors.2, and

Kavita  Vs.  Deepak  and Ors.3  It has  been  held that the

“income” should include those benefits, either in terms of

money or otherwise, which are taken into consideration for the

purpose of payment of income tax or professional tax,

although some elements thereof may or may not be taxable

due to the exemption conferred thereupon under the statute.  

12. The computation of taxable income as disclosed by the

appellant in his tax return for the assessment year 2004­2005

for the previous year ended on 31st  March, 2004,

unambiguously reinforces the claim of the appellant that his 1  (2008) 2 SCC 763 2  (2008) 4 SCC 162 3  (2012) 8 SCC 604

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annual taxable income  was Rs.77,480/­ (rounded off) and

income tax due thereon was Rs.4,496/­. After providing

deduction  of the income tax  payable by the  appellant, the

amount towards the  head ‘loss  of income’ of the  appellant

would be Rs.72,984/­ and not Rs.44,511/­ as assumed by the

Tribunal.  

13. In  other  words, compensation  under the  head  ‘loss  of

income for  11  months’  would  be (Rs.72,984  ÷  12) x  11  =

Rs.66,902. Similarly, towards the head ‘loss of future income’

computed by the Tribunal on the basis of disability suffered by

the appellant to the extent of 25% in relation to his lower limb

and keeping  in mind that the age of appellant was only 36

years on the date of the accident and the exposition  in the

case of  Sayed Sadiq Vs. Divisional Manager United India

Insurance Co. Ltd.4  (paragraphs 10 and 11), the appellant

would be entitled to 40% of Rs.72,984 i.e. Rs.29,194 (rounded

off) x 15 (multiplier), which comes to Rs.4,37,910. Thus, the

appellant would be entitled to receive enhanced compensation

4 2014 (2) SCC 735

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[Rs.66,902  ­  Rs.40,802  =  Rs.26,100  (Rupees twenty six

thousand one  hundred) and  Rs.4,37,910  ­  Rs.1,78,044  =

Rs.2,59,866  (Rupees two lakh fifty nine thousand eight

hundred  and  sixty six)]  under these two  heads, instead  of

Rs.40,802/­ and Rs.1,78,044/­ awarded by the Tribunal.   In

other  words, the compensation amount towards these two

heads would stand enhanced by  Rs.2,85,966/­  (Rupees two

lakh eighty five thousand nine hundred and sixty six only) as

indicated above, to which the appellant would be entitled

along with interest at the rate of 9% (nine percent) per annum

in terms of our decision.  

14. The appellant has also claimed further compensation

towards damage  to  his  Maruti  Car  which,  according to the

appellant, was completely damaged, as mentioned in the

Mechanical Inspection Report (Ext. PW­6/D) and the value of

the car providing third party insurance (Ext.PW­6/E).   On a

careful scrutiny of the judgment of the Tribunal, we find that

the Tribunal has not analysed this claim at all.  That grievance

was made by the appellant before the High Court, as noted in

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paragraph 9 of the impugned judgment claiming compensation

of Rs.80,000/­ towards the same. The High Court in

paragraph 13 of the impugned judgment, however, rejected the

claim on the finding that the appellant had failed to invite its

attention to any document indicating that the appellant had

incurred the expenses of Rs.80,000/­ towards car repair. Even

in the present appeals, the appellant has failed to invite

attention of this Court to any document on record in support

of the said claim. Resultantly, we find no reason to interfere

with the opinion expressed by the High Court on the  issue

under consideration.  

15. A priori, the appellant would succeed in getting

additional amount of  Rs.2,85,966/­  (Rupees two lakh eighty

five thousand nine hundred and sixty six only) as enhanced

compensation towards ‘loss of income’ and   ‘loss  of future

income’, along with interest at the rate of 9% (nine percent)

per annum thereon from the date of filing of the claim petition

before the Tribunal till the date of realization.  

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16. The appeals are allowed to that limited extent in the

above terms with no order as to costs.    

.………………………….CJI.         (Dipak Misra)

…………………………..….J.                  (A.M. Khanwilkar)

…………………………..….J.        (Dr. D.Y. Chandrachud)

New Delhi; February 09, 2018.