THE HON'BLE MR JUSTICE N.V. RAMANA and THE HON’BLE MR JUSTICE NOUSHAD ALI Civil Miscellaneous Appeal No.3086 of 1999 and Civil Revision Petition No.6727 of 2003 COMMON JUDGMENT:(per Hon’ble Mr Justice N.V.Ramana) C.M.A.No.3086 of 1999 is directed against the award dated 26.07.1999, passed by the learned IV Additional District Judge-cum- Chairman, Motor Accidents Claims Tribunal at Visakhapatnam (for short ‘the Tribunal’) in M.O.P.No.537 of 1995, while C.R.P.No.6727 of 2003 is filed against the order dated 01.03.2009, passed by the Tribunal in I.A.No.1337 of 1998 in M.O.P.No.537 of 1995. The appellants are the claimants. They filed M.O.P.No.537 of 1995 before the Tribunal claiming compensation of Rs.27,87,000/- for the death of the deceased, who is the husband of the first appellant and father of appellants 2 and 3, in a motor accident that occurred on 21.09.1994, due to the rash and negligent driving of Maruthi car, bearing Registration No.AP 31 B 8118, by the first respondent. The said car is owned by the second respondent and is insured with the third respondent-Insurance Company. According to the appellants, the deceased at the time of his death in the accident, was aged about 36 years, was working as a Major in the Indian Army and drawing a salary of Rs.7,236/- per month. Before the Tribunal, the first and second respondent, being the driver and owner of the car, remained ex parte. The third respondent- Insurance Company filed its counter denying its liability and contending that the compensation claimed by the claimants is excessive. While M.O.P. is pending, the recommendations of V Pay Commission came into effect, and it is the case of the claimants that had the deceased been alive, he would have also got the benefit of pay revision, and therefore, they filed application in I.A.No.1337 of 1998 under Order XIX Rule 1 CPC praying to amend the pleading in the M.O.P., as regards claim of compensation from Rs.27,00,000/- to Rs.60,00,000/-. The Tribunal, having heard the learned counsel and taking into consideration the facts and circumstances, vide order, dated 01.03.1999, dismissed the said application. Questioning the same, the appellants filed the present C.R.P., under Article 227 of the Constitution of India. However, thereafter, the Tribunal proceeded to decide the main M.O.P. The Tribunal, basing on Ex.A6, last pay certificate of the deceased, had taken the net salary of the deceased at Rs.4,950/-, after deducting Rs.360/-, Rs.1,500/-, Rs.120/-, Rs.30/- and Rs.275/- on various heads. From the net salary of Rs.4,950/-, the Tribunal deducted one-third towards personal and living expenses, and arrived the contribution of the deceased to the family at Rs.3,300/- per month, which comes to Rs.39,600/- per annum. As Ex.A8, Postmortem Certificate, disclosed the age of the deceased as 35 years, the Tribunal applied the multiplier of 17, and arrived at the loss of dependency to the family at Rs.6,73,200/-, apart from awarding Rs.15,000/- towards consortium to the first claimant-wife. Further, as the parents of the deceased also filed M.O.P.No.294 of 1995, wherein the Tribunal had awarded compensation of Rs.1,00,000/-, the Tribunal deducted the said amount of Rs.1,00,000/- from the compensation amount of Rs.6,73,200/- granted in the present M.O.P., and apportioned the remaining amount of Rs.5,73,200/- among the appellants-claimants. So far as interest is concerned, though the claimants claimed interest at the rate of 18% p.a., but as the M.O.P., was pending for a long time because of laches on the part of claimants, awarded interest at the rate of 6% p.a. from the date of the petition till the date of realization. Not satisfied with the quantum of compensation, the appellants-claimants filed the present C.M.A. The learned counsel for the appellants-claimants contended that had the deceased been alive, he would have got the benefit of the V Pay Commission, and as such, the application filed by the appellants-claimants, praying to amend the claim in the M.O.P. from Rs.27,00,000/- to Rs.60,00,000/- ought to have been allowed, but the Tribunal committed an error in dismissing the application. He further contended that the deceased at the time of his death was only 36 years, and had he been alive, he would have earned promotions, and as such, while awarding compensation, the Tribunal ought to have taken into consideration the future prospects of the deceased, and in support of this argument, he relied upon the judgment of the Supreme Court in the case of Sarala Verma (Smt.) and others Vs. Delhi Transport Corporation and another[1]. On the other hand, the learned Standing Counsel appearing for the third respondent-Insurance Company vehemently opposed the contention of the appellants contending that even though V Pay Commission came into effect during the pendency of the M.O.P., there is no need to take into consideration the enhanced salary, while calculating the loss of earnings of the deceased. We have heard the learned counsel for the appellants as well as the learned Standing Counsel appearing for the third respondent- Insurance Company at length. The question that arises for consideration is - Whether future prospects can be taken into account for determining the income of the deceased? If so, whether pay revision that occurred during the pendency of the claim proceedings, should be taken into account, for the purpose of fixing the salary of the deceased? The apex Court in Sarala Verma (supra), held that the actual income of the deceased less income tax, should be the starting point for calculating the compensation, and an addition of 50% of actual salary to the actual salary of the deceased shall be taken towards future prospects, where the deceased had a permanent job and was below 40 years. In the instant case, the deceased at the time of his death was 36 years old. He was working as a Major in the Indian Army and was getting a salary of Rs.7,236/- p.m. The Tribunal, while computing the contribution to the family, has deducted Rs.360/- towards income-tax; Rs.1,500/- towards D.S.O.P. Fund; Rs.120/- towards A.O.C.E.S. Fund; Rs.30/- towards A.G.I.F., and Rs.275/- towards A.F.M.S.O. Fund, from out the salary of the deceased. Out of the said deductions, as per the aforesaid judgment of the Supreme Court, the only permissible deduction is income-tax. Thus, if income tax of Rs.1,500/- is deducted from the actual salary of the deceased, his monthly income would come to Rs.6,876/-, and if 50% of the actual salary is added to the actual salary towards future prospects, as the deceased was below 40 years of age and had a permanent job, his salary would come to Rs.10,314/- per month i.e. Rs.1,23,768/- per annum. If one-third of the said amount, is deducted towards his personal and living expenses, his contribution to the family would be Rs.82,512/- and having regard to the fact that the deceased was 36 years at the time of his death in the accident, the relevant multiplier would be 16. Thus, the loss of dependency to the claimants on account of the death of the deceased would be Rs.13,20,192/-. Apart from the said amount, claimant No.1 is also entitled to Rs.15,000/- towards loss of consortium, as awarded by the Tribunal. Thus, the claimants, in all, would be entitled to compensation of Rs.13,35,192/-. Accordingly, the civil miscellaneous appeal is partly allowed, enhancing the compensation from Rs.6,73,200/-, as awarded by the Tribunal to Rs.13,20,192/- (Rupees thirteen lakh twenty thousand one hundred and ninety two only). The enhanced amount shall carry interest at the rate of 6% per annum. It is needless to mention that out of the compensation now awarded, the amount of Rs.1,00,000/- already granted to the parents of the deceased in M.O.P.No.294 of 1995, shall be deducted. Out of the amount of Rs.12,20,192/-, claimant No.1 is entitled to Rs.4,65,000/- while claimant Nos.2 and 3, are entitled to Rs.3,77,596/- each. Since the compensation arrived at above, is based on the future prospects of the deceased, there is no need to interfere with the order under revision, passed by the Tribunal, refusing to take into consideration the V Pay Commission, which came into effect during the pendency of the C.M.A. Hence, the C.R.P. is dismissed. No costs. __________________ N.V. Ramana, J _________________ Noushad Ali, J Date:15.02.2010 VGB [1] (2009) 6 SCC 121