- 1 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 IN THE HIGH COURT OF KARNATAKA DHARWAD BENCH DATED THIS THE 22ND DAY OF APRIL, 2025 PRESENT THE HON'BLE MR. JUSTICE S G PANDIT AND THE HON'BLE MR. JUSTICE C.M. POONACHA MISCELLANEOUS FIRST APPEAL NO.102570 OF 2020 (MV-D) C/W MISCELLANEOUS FIRST APPEAL NO.103095 OF 2022 IN M.F.A. NO. 102570 OF 2020 BETWEEN: THE DIVISIONAL MANAGER, IFFCO-TOKIO GENERAL INSURANCE CO. LTD., SRI. SHANTI TAWAR, 5TH FLOOR, 141, 3RD MAIN, EAST OF NGEF LAYOUT, KASTURI NAGAR, BENAGALURU-5600043, NOW REP. BY ITS AUTHORISED SIGNATORY. …APPELLANT (BY SRI SUBHASH J. BADDI, ADVOCATE.) AND: 1. SMT. AMRUTA WIFE OF VINAYAKA CHAVAN @ CHAUHAN, AGE: 26 YEARS, OCC: HOUSEHOLD, R/O: GADAG, DIST: GADAG-582101. 2. SMT. ANURADHA WIFE OF AMBASA CHAVAN @ CHAUHAN, AGE: 53 YEARS, OCC: HOUSEHOLD, R/O: GADAG, DIST: GADAG-582101. 3. AMBASA S/O. RAMESH CHAVAN @ CHAUVAN, Digitally signed by MALLIKARJUN RUDRAYYA KALMATH Location: HIGH COURT OF KARNATAKA - 2 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 AGE: 58 YEARS, OCC: BUSINESS, R/O: STATION ROAD, TQ: DIST: GADAG-582101. …RESPONDENTS (BY SRI GIRISH HULAMANI, ADVOCATE FOR R1 AND R2; R3 – NOTICE SERVED.) THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER SECTION 173(1) OF MOTOR VEHICLES ACT, 1988, PRAYING TO ALLOW THE APPEAL AS PRAYED FOR BY SETTING ASIDE THE JUDGMENT AND AWARD DATED 29.06.2020 PASSED IN MVC NO.184/2017, ON THE FILE OF THE PRINCIPAL SENIOR CIVIL JUDGE AND CHIEF JUDICIAL MAGISTRATE AND ADDITIONAL MOTOR ACCIDENT CLAIMS TRIBUNAL, GADAG, WITH COST IN THE INTEREST OF JUSTICE AND EQUITY. IN M.F.A. NO.103095 OF 2022 BETWEEN: 1. SMT. AMRUTA W/O. VINAYAKA CHAVAN, AGE: 27 YEARS, OCC: HOUSEHOLD, R/O: GADAG, TQ: AND DIST: GADAG-582101. 2. SMT. ANURADHA W/O. AMBASA CHAVAN @ CHAUHAN, AGE: 53 YEARS, OCC: HOUSEHOLD, R/O: GADAG, TQ: AND DIST: GADAG-582101. …APPELLANTS (BY SRI GIRISH HULAMANI, ADVOCATE.) AND: 1. SRI. AMBASA S/O. RAMESH CHAVAN CHAUHAN, AGE: 58 YEARS, OCC: BUSINESS, R/O: STATION ROAD, GADAG, TQ: AND DIST: GADAG-582101. 2. THE DIVISIONAL MANAGER, IFCO TOKIO GENERAL INSURANCE CO. LTD., - 3 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 SRI. SHANTI TAWAR, 5TH FLOOR, 141, 3RD MAIN, EAST OF NGEF LAYOUT, KASTURI NAGAR, BENGALURU-560043. …RESPONDENTS (BY SRI SUBHASH J. BADDI, ADVOCATE FOR R2; R1 – SERVICE OF NOTICE DISPENSED WITH.) THIS MISCELLANEOUS FIRST APPEAL IS FILED UNDER SECTION 173(1) OF MOTOR VEHICLES ACT, 1988, PRAYING TO MODIFY THE JUDGMENT AND AWARD DATED 29.06.2020 PASSED IN MVC NO.184/2017 ON THE FILE OF THE PRINCIPAL SENIOR CIVIL JUDGE, CHIEF JUDICIAL MAGISTRATE AND ADDITIONAL MOTOR ACCIDENT CLAIMS TRIBUNAL, GADAG AND ENHANCE THE COMPENSATION AS PRAYED FOR AND ETC.,. THESE MISCELLANEOUS FIRST APPEALS COMING ON FOR ADMISSION THIS DAY, JUDGMENT IS DELIVERED THEREIN AS UNDER: CORAM: THE HON'BLE MR. JUSTICE S G PANDIT AND THE HON'BLE MR. JUSTICE C.M. POONACHA ORAL JUDGMENT (PER: THE HON'BLE MR. JUSTICE C.M. POONACHA) MFA No.102570/2020 is filed by the insurer and MFA No.103095/2022 is filed by the claimants. 2. Both the appeals are filed under Section 173(1) of the Motor Vehicles Act, 1988, calling in question the judgment and award dated 29.06.2020, passed in MVC No.184/2017, by the Principal Senior Civil Judge, CJM and - 4 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 Additional MACT, Gadag1. Hence, both the appeals are taken up together for consideration. 3. The parties will be referred to as per their ranking before the Tribunal, for the sake of convenience. 4. The relevant facts in a nutshell leading to the present appeals are that one Vinayak2 was travelling in a car on 12.07.2017 when the driver of the said car driving the same in a rash and negligent manner, hit against a lorry causing the accident in question, wherein the deceased sustained grievous injuries and succumbed to the same on the next day. Claiming compensation for the death of the deceased, his wife and mother instituted a claim proceedings arraying the owner and insurer of the car as respondents No.1 and 2. Respondent No.1 (owner) remained ex-parte before the Tribunal. Respondent No.2 (insurer) contested the claim proceedings. 5. The claimant No.2 was examined as PW.1 and Chartered Accountant was examined as PW.2 and the 1 Hereinafter referred to as ‘Tribunal’. 2 Hereinafter referred to as ‘deceased’. - 5 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 Income Tax Inspector as PW.3. Exs.P.1 to P.11 were marked. The respondents did not adduce any oral evidence. The insurance policy was marked as Ex.R.1. The Tribunal by its judgment and award dated 29.06.2020, partly allowed the claim petition and awarded a total compensation of Rs.44,27,338/- together with interest @ 6% p.a. and directed the insurer to pay the compensation awarded. 6. Being aggrieved, the above appeals have been filed. 7. Learned counsel Sri Subhash J. Baddi, appearing for the insurer contends that the income of the deceased assessed by the Tribunal in a sum of Rs.2,56,314/- is erroneous, having regard to the fact that the deceased was a partner in a partnership firm and the partnership firm has continued to carry on its business. It is further contended that future prospects of 50% assessed by the Tribunal is erroneous and since the wife of the deceased was the sole dependent, the Tribunal erred in deducting 1/3rd towards personal expenses and ought to have deducted 50% towards personal expenses of the deceased. Hence the learned - 6 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 counsel seeks for reduction in the compensation awarded by the Tribunal. 8. Per contra, learned counsel Sri Girish S. Hulmani, appearing for the claimants contends that assessment of income of the deceased is on lower side and the Tribunal has not taken into consideration the income tax returns for the Assessment Year3 2015-16 (Ex.P.9) while assessing the monthly income and has assessed the monthly income as per the income tax returns of the AY-2014-15 (Ex.P.10). It is further contended that the testimony of PW.2 and PW.3 has not been appreciated in a proper perspective. That the compensation awarded by the Tribunal on conventional heads is on the lower side. 9. The submissions of both the learned counsels have been considered and the material on record including the records of the Tribunal have been perused. 10. The questions that arise for consideration are: 3 Hereinafter referred to as ‘AY’. - 7 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 i) Whether the assessment of income of the deceased by the Tribunal is erroneous? ii) Whether the quantum of compensation is liable to be interfered with? Regarding Questions No.1 and 2: 11. The finding of the Tribunal on negligence and liability are not under challenge and have attained finality. Hence the only aspect to be adjudicated in the above appeals is with regard to quantum of compensation. 12. The claimants in the claim petition have averred that the deceased was running a shop by name A.R.Chavan and Co. at Gadag and earning Rs.50,000/- per month. PW.1 (claimant No.2) in her testimony has reiterated the assertions made in the claim petition. 13. PW.2 the Chartered Accountant has produced the income tax returns of the AY-2014-15 (Ex.P.10) and AY-2015-16 (Ex.P.9) and deposed that the income of the deceased in the year 2014-15 was Rs.2,56,314/- and in the AY-2015-16, Rs.2,67,556/-. The income tax inspector (PW.3) has deposed regarding the fact that the income tax returns - 8 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 of the firm M/s.A.R.Chavan and Co. for the AY-2013-14, 2014-15, and 2015-16 have been downloaded from the website of the income tax department and produced along with a letter dated 28.08.2019 (Ex.P.11). 14. PW.2 and PW.3 have been cross examined with regard to the income tax returns and also with regard to the fact that the income tax returns pertains to the partnership firm A.R.Chavan and Co. The amounts paid under Ex.P.9 for AY-2015-16 to the deceased towards interest to partner, remuneration and share in profit cumulates to Rs.2,67,556-75. Similarly Ex.P.10 the income tax returns for AY-2014-15 discloses that the amounts paid to the deceased towards the heads of interest, salary and profit cumulates to Rs.2,56,314/-. 15. Although it is the vehement contention of the learned counsel for the insurer that even after death of the deceased, the partnership firm has continued to carry on business and that the legal representatives of the deceased partner are entitled to the amounts that were payable to the share of the deceased partner, it is relevant to note here that - 9 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 Ex.P.9 and P.10 disclose that the partnership firm A.R.Chavan and Co. has three partners and that the deceased was a partner of the firm having 33% share in the firm, to whom payments have been made as indicated therein. 16. Although it is the vehement contention of the claimants that the legal representatives of the deceased are entitled to the share of the deceased partner in the firm, there is no cross examination by the insurer to PW.1, PW.2 or PW.3 as to whether the legal representatives of the deceased have been inducted as partners of the firm and as to whether consequent to the death of the deceased, the share of the deceased in the firm devolves upon the legal representatives of the deceased. 17. In order to prove the income of the deceased, the claimants have examined PWs.1 to 3 and marked Exs.P.9, 10 and 11, wherein the remuneration paid to the deceased is stipulated. The claimants having produced the said material, have discharged their burden of proving the income and avocation of the deceased. Learned counsel for the insurer - 10 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 would contend that the income of the deceased as stipulated in Ex.P.9, P.10 or P.11 is not the correct income. They ought to have cross examined the witnesses regarding the entries made in the said documents. The insurer having failed to discharge its onus of demonstrating that the income of the deceased mentioned in the said documents is in any manner incorrect, it is required to be held that the claimants have discharged the burden of proving the income of the deceased. 18. The Tribunal has assessed the income of the deceased as Rs.2,56,314/-. However, it is relevant to note that the income of the deceased towards the amounts paid by the firm for AY-2015-16 (Ex.P.9) is Rs.2,67,556-75. Hence, it is just and proper the annual income of the deceased is re-assessed as Rs.2,67,557/-. 19. The vehement contention of the learned counsel for the insurer that the amounts mentioned in Ex.P.9 towards interest to partner, remuneration and share of profit have not actually been paid to the deceased and hence the said amounts cannot be construed as income of the - 11 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 deceased is liable to be rejected, having regard to the fact that the said aspects have not been cross examined to PW.1, PW.2 or PW.3. Accordingly the income as mentioned for AY-2015-16 (Ex.P.9) is assessed as the monthly income of the deceased. 20. The Tribunal has assessed the age of the deceased as 26 years as per the post-mortem report (Ex.P.6). Accordingly the multiplier assessed by the Tribunal at 17 is just and proper. 21. The Tribunal has added 50% towards future prospects. However, having regard to the judgment of the Hon’ble Supreme Court in the case of National Insurance Company Limited vs. Pranay Sethi and others4, future prospects is re-assessed as 40%. The deceased was married. Hence, 1/3rd is to be deducted towards personal and living expenses of the deceased. Accordingly the annual income of the deceased for the purpose of assessment of loss of dependency is re-assessed as 4 (2017) 16 Supreme Court Cases 680 - 12 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 Rs.2,49,720/- (Rs.2,67,557/-+ 40% less 1/3rd). Hence, the loss of dependency is re-assessed as Rs.42,45,240/- (Rs.2,49,720/- x 17). 22. The claimants being wife and mother of the deceased are entitled for loss of consortium at Rs.40,000/- each together with 10% increment in terms of the judgment of the Hon’ble Supreme Court in Magma General Insurance Co. Ltd., vs. Nanu Ram and others5. Accordingly loss of consortium is re-assessed as Rs.88,000/- (Rs.40,000/- + 10% x 2), as against Rs.40,000/- awarded by the Tribunal. 23. Loss of estate and funeral expenses is to be awarded in a sum of Rs.16,500/- each. 24. In view of the same, the compensation is re-assessed as follows: Sl. No. Heads Amount awarded by the Tribunal (₹) Amount awarded by this Court (₹) 1. Loss of dependency. 43,57,338 42,45,240 2. Loss of consortium. 40,000 88,000 5 (2018) 18 Supreme Court Cases 130 - 13 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 3. Loss of estate. 15,000 16,500 4. Funeral expenses. 15,000 16,500 Total: 44,27,338 43,66,240 25. Hence, the claimants are entitled to a total compensation of Rs.43,66,240/- as against Rs.44,27,338/- awarded by the Tribunal. 26. Taking judicial notice of the rate of interest awarded towards fixed deposits, the rate of interest awarded by the Tribunal is re-assessed as 7% p.a. Hence the questions No.1 and 2 framed for consideration are answered in the affirmative. 27. In view of the aforementioned, the following: ORDER i) Both the appeals are allowed in part. ii) The judgment and award dated 29.06.2020, passed in MVC No.184/2017, by the Principal Senior Civil Judge, CJM and Additional MACT, Gadag, is modified to the extent of holding that the claimants are entitled to a total compensation of Rs.43,66,240/- as against Rs.44,27,338/- - 14 - NC: 2025:KHC-D:6696-DB MFA No. 102570 of 2020 C/W MFA No. 103095 of 2022 awarded by the Tribunal, together with interest @ 7% p.a. from the date of petition till the date of payment. iii) The judgment and award of the Tribunal in all other respects remain unaltered. iv) The amount in deposit made by the appellant/insurer in MFA No.102570/2020 together with the records of the Tribunal be transmitted to the Tribunal forthwith. v) The balance amount of compensation shall be deposited by the insurer as ordered herein, within six weeks. vi) Modified award be drawn accordingly. Sd/- (S G PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE MRK CT: UMD List No.: 1 Sl No.: 16