Holding

For purposes of Section 168, "income" includes all salary, allowances and perquisites that benefit the family, and "just compensation" must be calculated on this total income after deducting only statutory taxes.

Summary

The deceased, R.K. Srivastava, a salaried employee, died in a road accident and his wife and children claimed "just compensation" under Section 168 of the Motor Vehicles Act, 1988. The central issue was the proper computation of the deceased's total income for compensation – whether only basic salary should be considered or also the various allowances, perquisites and statutory contributions that benefit the family. The Supreme Court held that the term "income" must be given its ordinary, dictionary meaning and include all benefits and perquisites that are taken into account for income‑tax or professional‑tax purposes, excluding only statutory deductions such as tax. Consequently, "just compensation" should be based on this broader total income less only statutory taxes, while items like medical reimbursement are not part of income. However, the Court declined to alter the High Court's award because of procedural considerations, and dismissed the appeal, leaving the lower court's order largely intact.

Issues considered

The proper definition of "income" for the purpose of computing compensation under Section 168 of the Motor Vehicles Act, 1988.
Whether only basic salary or also allowances, perquisites and statutory contributions (PF, gratuity, superannuation, etc.) should be included in the deceased's income.
Whether medical reimbursement and other specific allowances should be excluded from income for compensation purposes.
The appropriate method of calculating "just compensation" for dependants of a deceased road‑accident victim.

Legislation cited

Motor Vehicles Act, 1988s. 168

Subjects

Motor Vehicles ActSection 168just compensationincome definitiondependants' compensationallowancesperquisitesProvident Fundgratuitysuperannuationnet incomegross incomecompensation calculation

Judgment

A NATIONAL INSURANCE COMPANY LTD. -T.
'f
v.
INDIRA SR.IVASTAVA & ORS.

DECEMBER 12, 2007 -::
B
[S.B. SINHA AND HARJIT SINGH BEDI, JJ.]
). '
Motor Vehicles Act, 1988-s. l 68-Death ofsalaried employee-
Computation of total income of deceased-Determination of 'just
c compensation '-Held: Total income of deceased-employee to be
computed not only having regard to the pay packet he carried home
at the end of the month but also other perks paid for benefit of his
entire family contra-distinguishedfrom perks paidfor his own benefit_:_ _......
Compensation to be determined on basis oftotal income so computed.
D
Words and Phrases- ''just" and "income "-Meaning of -4·

Connotation ofthe term 'income' for the purpose ofdetermination
of 'just compensation' envisaged under Section 168 of the Motor
Vehicles Act, 1988 is in question in the present appeal.
E
On behalf of the appellant it was contended that for the purpose
ofcomputation of the amount ofcompensation what was material is the
basic pay and not other allowances and that emphasis is to be laid on
computation of damages based on net income and not gross income. A -:.:.:._
F
Respondent, however, submitted that apart from the basic salary,
contributions made by the employee should also be taken into
consideration for calculation ofthe amount ofcompensation, inter alia,
on the premise that the same would have become payable to him at a
G future date as, for example, voluntary retirement, superannuation etc.
which would be beneficial to the entire family. It was submitted that the
contributions towards Provident Fund, Life Insurance Corporation, -+-
gratuity etc. are includible in the definition of income.

H 352
NATIONAL INSURANCE COMPANY LTD. v. INDIRA 353
SRIVASTAVA
-.
'r Dismissing the appeal, the Court A
HELD: 1.1. The term 'income' has different connotations for
different purposes. Acourt oflaw, having regard to the change in societal
~
conditions must consider the question not only having regard to pay
packet the employee carries home atthe end ofthe month but also other B
perks which are beneficial to the members of the entire family.
. .I, [Para8] (357-F,G]

1.2. If the dictionary meaning of the word 'income' is taken to its
logical conclusion, it should include those benefits, either in terms of
money or otherwise, which are taken into consideration for the purpose c
of payment of income-tax or profession tax although some elements

- thereof may or may not be taxable or would have been otherwise
taxable but for the exemption conferred thereupon under the statute.
[Para 19] (364-F, G)
-· -1- D
1.3 .The expression 'just' must also be given its logical meaning.
Whereas it cannot be a bonanza or a source of profit but in considering
as to what would be just and equitable, all facts and circumstances must
be taken into consideration. [Para 23] [366-A-B]
E
P. Ramanatha Aiyar's Advanced Law Lexicon (3rd Ed.), referred
to.
2.1. S.168 ofthe Act uses the word 'just compensation' which should
,.,,,,. '>- be assigned a broad meaning. One cannot, in determining the issue
involved in the matter, lose sight of the fact that the private sector F
companies in place of introducing a pension scheme takes recourse to
payment of contributory Provident Fund, Gratuity and other perks to
attract the people who are efficient and hard working. Different offers
made to an officer by the employer, same may be either for the benefit
of the employee himself or for the benefit of the entire family. If some G
facilities are being provided whereby the entire family stands to benefit,
the same must be held to be relevant for the purpose of computation of
total income on the basis whereof the amount of compensation payable
for the death of the kith and kin of the applicants is required to be
determined. [Para 9) (358-A, B, CJ H
354 SUPREME COURT REPORTS [2007] 13 (Addi.) S.C.R.

A 2.2. Whatwould be 'just compensation' must be determined having
regard to the facts and circumstances of each case. The basis for
considering the entire pay packet is what the dependents have lost due
to death of the deceased. It is in the nature of compensation for future
loss towards the family income. The amounts, therefore, which were
B required to be paid to the deceased by his employer by way of perks,
should be included for computation of his monthly income as that would
have been added to his monthly income by way of contribution to the
family as contradistinguished to the ones which were for his benefit.
However, from the said amount of income, the statutory amount of tax
C payable thereupon must be deducted
[Paras 15 and 17) [362-A, B; 364-A, BJ

D
Asha & Ors. v. United Indian Insurance Co. Ltd & Anr., [2004) SCC
533, distinguished.
The Manager, National Insurance Co. Ltd v. Padmavathy & Ors.,
CMA No.114 of2006 decided on 29.1.2007; S. Narayanamma & Ors.
-
v. Secretary to Government ofIndia, Ministry ofTelecommunications and
Ors., [2002) SCC 582; Rathi Menon v. Union ofIndia, [2001) 3 SCC 714;
N. Sivammal & Ors. v. Managing Director, Pandian Roadways
E Corporation & Ors., (1985] 1SCC18; TN State Transport Corporation
Ltd. v. S.Rajapriya & Ors., (2005] 6 SCC 236; New India Assurance Co.
Ltd v. Charlie &Anr., [2005] 10 SCC 720 and New India Assurance Co.
Ltd v. Kalpana (Smt.) & Ors., (2007] 3 SCC 538, referred to.

F 3. In view of the finding abovementioned, the present appeal is to
be allowed in part in so far as the High Court had directed deduction of
--( -
medical reimbursement and tax elements on the entire sum which
according to the statute constitute income. But this Court declines to
do so for two reasons. Firstly, the accident had taken place as far back
G as on 1st September, 1997 and secondly the Tribunal as also the High
Court failed to take into consideration rise in income of the deceased
by way of promotion or otherwise. For the aforementioned reasons, this
Court is not inclined to interfere with the impugned judgment of the High
Court. [Para 24 and 25) [366-B, C, DJ
H CIVIL APPELLATE JURISDICTION: Civil Appeal No. 5830 of
NATIONAL INSURANCE COMPANY LTD. v. INDIRA 355
SRIVASTAVA [SINHA, J.] .
2007. A
From the Judgment and Order dated 06.04.2007 of the High Court
of Judicature at Allahabad, Lucknow Bench at Lucknow in F.A.F .0. No.
171 of2001.
Joy Basu and B.K. Satija for the Appellant. B

L.N. Rao, (A.C.), for the Respondent and Indira Srivastava
Caveator-In-Person.
The Judgment of the Court was delivered by
c
S.B. SINHA, J. l. Leave granted.
2. Connotation of the tenn 'income' for the purpose of determination
of 'just compensation' envisaged under Section 168 of the Motor Vehicles
Act, 1988 (the Act) calls for question in this appeal which arises out of a
judgment and order dated 6.4.2007 passed by the High Court of D
Judicature at Allahabad, Lucknow Bench at Lucknow in FAFO No.171
of2001. Respondent's husband R.K. Srivastava was employed in a
company named Gabriel India Ltd. While he was travelling in an auto
rickshaw from Charbagh Railway Station, Lucknow to his residence
situated at Ashok Marg, the same met with an accident with a 'Mahindra E
Commander Jeep' driven rashly and negligently. He sustained injuries and
ultimately succumbed thereto. Respondents herein filed a claim petition
before the learned Tribunal. A salmy certificate was produced in the said
proceedings which is in the following tenns :
F
Earnings Amount Deductions Amount

Basic 3420.00 CPF(S) 488.00
Special Pay 70.00 CPF (Add)
G
FDA 350.00 GIS 3.75
-f-
VDA 1040.00 LIC/GIS 509.10
CCA 100.00 HRR
H
356 SUPREME COURT REPORTS (2007] 13 (Addi.) S.C.R.

A HRA 1047.00 MSPI 60.00 f -
WashingAll. 75.00 Society 576.00
Conv. 225.00 Union 3.00

B Cant.sub. 265.00 HBA 340.00
C.E.A. 2040.00 B.Fund 10.00
J_

Total 8632.00 Total 1989.85
3. The learned Tribunal opined that in computing his income, the
c element of conveyance allowance only would fall outside the purview of
income. On the aforementioned basis, the monthly income of the deceased
was assessed at Rs.20364/-. Applying the multiplier of 13, as the age of
the deceased was 45 years, it was held :
"As such, on using multiple of 13 to the annual income of deceased
D
at Rs.2,32,372/-, the amount works out to Rs.30,20,836/-. The ~

deceased would have spent I/3rd of this amount on himself, hence
on deducting I/3rd from this amount, 2/3rd compensation aniount
comes to Rs.20,13,890/-."
E It was concluded:
"Considering all these facts, I reach to this finding that the
petitioners are entitled to get 2/3rd of the total income of deceased
worked out by using multiple of 13 i.e. about Rs.20,00,000/-. Issue
~·
F No.5 is decided accordingly. It is the liability ofopposite party No.3
Insurance Company. On behalf of opposite party No.3, the ruling
ofHon'ble High Court Smt. Lalta Devi v. Suresh & Ors., T.A.C.
8, 1999 (1) page 847 has been filed before me, but this ruling does
not extend any specific benefit to opposite party No.3. Hence, while
G deciding this issue No.5, I come to this conclusion that the
petitioners are entitled to get Rs.20,00,000/- (Rs. Twenty Lakhs)
as compensation."

4. The High Court, on an appeal having bee~ preferred both by the
appellant as also the respondents, partly allowed tl:ie same by a common
H
NATIONAL INSURANCE COMPANY LTD. v. INDIRA 357
SRIVASTAVA [SINHA, J.]
,. judgment holding that claimants were entitled to compensation calculated A
~-
i in case of the deceased at Rs.19,53,224/- along with interest@ 9% from
the date of presentation of the claim petition till its realization, holding that
travelling reimbursement could not be taken into consideration for
computation of net income of the deceased.
B
5. Appellant is, thus, before us.
Keeping in view the importance of the question involved and
furthermore in view of the fact that the first respondent was appearing-
in- person, we had requested Mr. L.N. Rao, learned senior counsel, to
assist us in the matter. c
6. Submission of Mr. Satija, learned counsel appearing on behalf of
the appellant, is that for the purpose of computation of the amount of
compensation what was material is the basic pay and not other allowances
and, in that view of the matter, the High Court has committed a serious
.., D
1 error in opining otherwise. The learned counsel contended that emphasis
by this Court are being laid on computation of damages based on net
income and not gross income. It was also contended that in any event
the amount of compensation awarded by the High Court is on higher side.
7. Mr. Rao, however, submitted that apart from the basic salary, E
contributions made by the employee should also be taken into
consideration for calculation of the amount of compensation, inter alia,
on the premise that the same would have become payable to him at a
- - 'f
future date as, for example, voluntary retirement, superannuation etc. which
would be beneficial to the entire family. It was pointed out that the F
contributions towards Provident Fund, Life Insurance Corporation,
gratuity etc. are includable in the definition of income.
8. The term 'income' has different connotations for different
purposes. A court of law, having regard to the change in societal G
conditions must consider the question not only having regard to pay packet
~~
the employee carries home at the end of the month but also other perks
which are beneficial to the members of the entire family. Loss caused to
the family on a death of a near and dear one can hardly be compensated
on monetory terms. H
358 SUPREME COURT REPORTS [2007] 13 (Addl.) S.C.R.

A 9. Section 168 of the Act uses the word 'just compensation' which,
in our opinion, should be assigned a broad meaning. We cannot, in
... ·- ~

determining the issue involved in the matter, lose sight of the fact that the
private sector companies in place of introducing a pension scheme takes
recourse to payment of contributory Provident Fund, Gratuity and other
B perks to attract the people who are efficient and hard working. Different
offers made to an officer by the employer, same may be either for the
benefit of the employee himself or for the benefit of the entire family. If
some facilities are being provided whereby the entire family stands to
benefit, the same, in our opinion, must be held to be relevant for the
c purpose of computation of total income on the basis whereof the amount
of compensation payable for the death of the kith and kin of the applicants
is required to be determined. For the aforementioned purpose, we may
notice the elements of pay, paid to the deceased :
"BASIC 63,400.00
D
~ ,,.
CONVEYANCE
ALLOWANCE 12,000.00
RENT CO LEASE 49,200.00
E BONUS (35% OF BASIC) 21,840.00
TOTAL 1,45,440.00
In addition to above, his other entitlements were :

F
Con. to PF 10% Basic
LTA reimbursement
Rs. 6,240/- (p.a.)
Rs. 7,000/- (p.a.)
"" --
Medical reimbursement Rs. 6,000/- (p.a.)
Superannuation 15% of Basic Rs. 9,360/- (p.a.)
G Gratuity Cont.5.34% of Basic Rs. 3,332/- (p.a.)
i-
Medical Policy-self & Family @ Rs.55,000/- (p.a.)
Education Scholarship @ Rs.500 Rs.12,000/- (p.a.)
Payable to his two children
H Directly"
NATIONAL INSURANCE COMPANY LTD. v. INDIRA 359
SRIVASTAVA [SINHA, J.]
-... \ 10. There are three basic features in the aforementioned statement A
I
which require our consideration :
1. Reimbursement of rent would be equivalent to HRA;
2. Bonus is payable as a part of salary; and
3. Contribution to the Provident Fund. B

4. 11. We may furthennore notice that apart therefrom, superannuation
benefits, contributions towards gratuity, insurance of medical policy for
self and family and education scholarship were beneficial to the members
of the family. c
12. We have, however, no doubt in mind that medical reimbursement
which provides for a slab and which keeping in view the tenninology used,
would mean reimbursement for medical expenses on production of medical
bills and, thus, the same would not come Within the purview of the
aforementioned category. D
~

~
13. The question came for consideration before a learned Single
Judge of the Madras High Court in The Manager, National Insurance
Co. Ltd v. Padmavathy & Ors., [CMA No.114 of2006 decided on
29.1.2007], wherein it was held : E
"Income tax, Professional tax which are deducted from the salaried
person goes to the coffers of the government under specific head
and there is no return. Whereas, the General Provident Fund,
·~ 't Special Provident Fund, L.I.C., Contribution are amounts paid
specific heads and the contribution is always repayable to an F
employee at the time of voluntary retirement, death or for any other
reason. Such contribution made by the salaried person are deferred
payments and they are savings. The Supreme Court as well as
various High Courts have held that the compensation payable under
the Motor Vehicles Act is statutory and that the deferred payments G
made to the employee are contractual. Courts have held that there
cannot be any deductions in the statutory compensation, ifthe Legal
Representatives are entitled to lumpsum payment under the
contractual liability. Ifthe contributions made by the employee which
H
360 SUPREME COURT REPORTS (2007] 13 (Addi.) S.C.R.

A are otherwise savings from the salary are deducted from the gross
income and only the net income is taken for computing the
t --
>-
dependancy compensation, then the Legal Representatives of the
victim would lose considerable portion of the income. In view of
the settled proposition oflaw, I am of the view, the Tribunal can
B make only statutory deductions such as Income tax and professional
tax and any other contribution, which is not repayable by the
employer, from the salary of the deceased person while determining
the monthly income for computing the dependancy compensation.
Any contribution made by the employee during his life time, form
c part of the salary and they should be included in the monthly
income, while computing the dependency compensation."

14. Similar view was expressed by a learned Single Judge of Andhra
Pradesh High Court in S. Narayanamma & Ors. v. Secretary to
Government of India, Ministry of Telecommunications and Ors.,
D
(2002] ACC 582, holding : ~

"In this background, now we will examine the present deductions
made by the tribunal from the salary of the deceased in fixing the
monthly contribution of the deceased to his family. The tribunal has
E not even taken proper care while deducting the amounts from the
salary of the deceased, at least the very nature of deductions from
the salary of the deceased. My view is that the deductions made
by the tribunal from the salary such as recovery of housing loan,
vehicle loan, festival advance and other deductions, if any, to the ~
~,

F benefit of the estate of the deceased cannot be deducted while
computing the net monthly earnings of the deceased. These
advances or loans are part of his salary. So far as House Rent
Allowance is concerned, it is beneficial to the entire family of the
deceased during his tenure, but for his untimely death the claimants
G are deprived of such benefit which they would have enjoyed if the
decea~ed is alive. On the other hand, allowances, like Travelling
Allowance, allowance for newspapers/periodicals, telephone,
servant, club-fee, car maintenance etc., by virtue of his vocation
need not be included in the salary while computing the net earnings
H of the deceased. The finding of the tribunal that the deceased was
NATIONAL INSURANCE COMPANY LTD. v. INDIRA 361
SRIVASTAVA [SINHA, J.]
getting Rs.1,401/- as net income every month is unsustainable as A
k-. ~
the deductions made towards vehicle loan and other deductions
were also taken into consideration while fixing the monthly income
of the deceased. The above finding of the tribunal is contrary to
the principle of just compensation' enunciated by the Supreme
Court in the judgment in Helen's case (1 supra). The Supreme B
Court in Concord of India Insurance Co. v. Nirmaladevi and
,( Ors., (1980) ACJ 55 (SC) held that detenr.ination of quantum must
be liberal and not niggardly since law values life and limb in a free
country 'in generous scales'."
c
15. We may, however, notice that a Division Bench of this Court in
Asha & Ors. v. United Indian Insurance Co. Ltd. & Anr. [2004] ACC
533, whereupon reliance has-been placed by Mr. Satija, was considering
a case where, like the present one, several perks were included in salary.
We may reproduce the salary certificate hereto below:
D
'·
-! "This is to certify that Shri A.M. Raikar was working as AG 111
in this organisation has been paid the following Pay & Allowances
forthemonthofMay, 1995:
Earnings Amount Deductions Amount E
Basic 3420.00 CPF(S) 488.00
Special Pay 70.00 CPF (Add)
FDA 350.00 GIS 3.75
VDA 1040.00 LIC/GIS 509.10
_.. 'I- CCA 100.00 HRR F
HRA 1047.00 MSPI 60.00
Washing All. 75.00 Society 576.00
Conv. 225.00 Union 3.00
Cant.sub. 265.00 HBA 340.00
C.E.A. 2040.00 B.Fund 10.00 G
Total 8632.00 Total 1989.85
--I
Net Payable Rs. 6642.00 (Rupees six thousand six hundred forty
two only)."
H
362 SUPREME COURT REPORTS [2007] 13 (Addi.) S.C.R.

A In that case, this Court held : rl-

"Lastly it was submitted that the salary certificate shows that the
•
salary of the deceased was Rs.8,632/-. It was submitted that the
High Court was wrong in taking the salary to be Rs.6,642/-. It
was submitted that the High Court was wrong in deducting the
B
allowances and amounts paid towards LIC, Society charges and
HBA etc. We are unable to accept this submission also. The
claimants are entitled to be compensated for the loss suffered by
them. The loss suffered by them is the amount which they would
have been receiving at the time when the deceased was alive. There
c can be no doubt that the dependents would only be receiving the
net amount less I/3rd for his personal expenses. The High Court
was therefore right in so holding."

This Court inAsha (supra) did not address itself the questions raised
D before us. It does not appear that any precedent was noticed nor the term
'just compensation' was considered in the light of the changing societal ...
condition as also the perks which are paid to the employee which may
or may not attract income tax or any other tax.

E What would be 'just compensation' must be determined having
regard to the facts and circumstances of each case. The basis for
considering the entire pay packet is what the dependents have lost due
to death of the deceased. It is in the nature of compensation for future
loss towards the family income.
"!' ~
F 16. In Rathi Menon v. Union of India, [2001] 3 SCC 714, this
Court, upon considering the dictionary meaning of compensation held :
"In this context a reference to Section 129 of the Act appears useful.
The Central Government is empowered by the said provision to
G make rules by notification "to carry out the purposes of this
Chapter". It is evident that one of the purposes ofthis chapter is
that the injured victims in railway accidents and untoward incidents
must get compensation. Though the word "compensation" is not
defined in the Act or in the Rules it is the giving of an equivalent
H or substitute of equivalent value. In Black's Law Dictionary,
NATIONAL INSURANCE COMPANY LTD. v. INDIRA 363
SRIVASTAVA [SINHA, J.]
"compensation" is shown as A
"equivalent in money for a loss sustained; or giving back an
equivalent in either money which is but the measure of value,
or in actual value otherwise conferred; or recompense in value
for some loss, injury or service especially when it is given by B
statute."
It means when you pay the compensation in terms of money it must
represent, on the date of ordering such payment, the equivalent
value.
25. In this context we may look at Section 128(1) also. It says
c
that the right of any person to claim compensation before the
Claims Tribunal as indicated in Section 124 or 124-A shall not
affect the right of any such person to recover compensation payable
under any other law for the time being in force. But there is an D
interdict that no person shall be entitled to claim compensation for
more than once in respect of the same accident. This means that
the party has two alternatives, one is to avail himself of his civil
remedy to claim compensation based on common law or any other
statutory provision, and the other is to apply before the Claims E
Tribunal under Section 124 or 124-A of the Act. As he cannot
avail himself of both the remedies he has to choose one between
the two. The provisions in Chapter Xlll of the Act are intended
to provide a speedier remedy to the victims of accidents and
untoward incidents. Ifhe were to choose the latter that does not
F
mean that he should be prepared to get a lesser amount. He is
given the assurance by the legislature that the Central Government
is saddled with the task of prescribing fair and just compensation
in the Rules from time to time. The provisions are not intended to
give a gain to the Railway Administration but they are meant to G
afford just and reasonable compensation to the victims as a
speedier measure. If a person files a suit the amount of
compensation will depend upon what the court considers just and
reasonable on the date of determination. Hence when he goes
before the Claims Tribunal claiming compensation the detennination 'H
364 SUPREME COURT REPORTS [2007] 13 (Addi.) S.C.R.

A of the amount should be as on the date of such detennination." ._
'
17. The amounts, therefore, which were required to be paid to the
deceased by his employer by way of perks, should be included for
computation of his monthly income as that would have been added to his
monthly income by way of contribution to the family as contradistinguished
B
to the ones which were for his benefit. We may, however, hasten to add
that from the said amount of income, the statutory amount of tax payable
thereupon must be deducted.
18. The term 'income' in P. Ramanatha Aiyar's Advanced Law
c Lexicon (3rd Ed.) has been defined as under:
"The value of any benefit or perquisite whether convertible into
money or not, obtained from a company either by a director or a
person who has substantial interest in the company, and any sum
D
paid by such company in respect of any obligation, which but for
such payment would have been payable by the director or other ...
I-
person aforesaid, occurring or arising to a person within the State
from any profession, trade or calling other than agriculture."
It has also been stated :
E
'INCOME' signifies 'what comes in' (per Selbome, C., Jones v.
Ogle, 42 LJ Ch.336). 'It is as large a word as can be used' to
denote a person's receipts '(per Jessel, MR Re Huggins, 51 LJ

F
Ch938.) income is not confined to receipts from business only and
means periodical receipts from one's work, lands, investments, etc.
~ ..
AIR 1921Mad427 (SB). Ref. 124 IC 511 : 1930 MWN 29:
31 MLW 438 AIR 1930 Mad 626: 58 MLJ 337."
19. If the dictionary meaning of the word 'income' is taken to its
logical conclusion, it should include those benefits, either in tenns of money
G or otherwise, which are taken into consideration for the purpose of
payment of income-tax or profession tax although some elements thereof ~--

may or may not be taxable or would have been otherwise taxable but for
the exemption conferred thereupon under the statute.

H 20. In N Sivammal & Ors. v. Managing Director, Pandian
NA TIO~AL INSURANCE COMPANY LTD. v. INDIRA 365
SRIVASTAVA [SINHA, J.]
Roadways Corporation & Ors., [1985) 1 SCC 18, this Court took into A
consideration the pay packet of the deceased.
21. We may notice that in T.N State Transport Corporation Ltd.
v. S. Rajapriya & Ors., [2005) 6 SCC 236, this Court held :
"8. The assessment of damages to compensate the dependants is B
beset with difficulties because from the nature of things, it has to
take into account many imponderables e.g. the life expectancy of
the deceased and the dependants, the amount that the deceased
would have earned during the remainder of his life, the amount that
he would have contributed to the dependants during that period, C
the chances that the deceased may not have lived or the dependants
may not live up to the estimated remaining period of their life
expectancy, the chances that the deceased might have got better
employment or income or might have lost his employment or income
together. D
9. The manner of arriving at the damages is to ascertain the net
income of the deceased available for the support of himself and
his dependants, and to deduct therefrom such part of his income
as the deceased was accustomed to spend upon himself, as regards E
both self-maintenance and pleasure, and to ascertain what part of
his net income the deceased was accustomed to spend for the
benefit of the dependants. Then that should be capitalised by
multiplying it by a figure representing the proper number of years'
_..:.,... i purchase.
F
10. Much of the calculation necessarily remains in the realm of
hypothesis "and in that region arithmetic is a good servant but a
bad master" since there are so often many imponderables. In every
case "it is the overall picture that matters", and the court must try
to assess as best as it can the loss suffered." G
22. Yet again in New India Assurance Co. Ltd. v. Charlie & Anr.,
(2005] 10 SCC 720, the same view was reiterated. However, therein
although the words 'net income' has been used but the same itself would
ordinarily mean gross income minus the statutory deductions. We must H
366 SUPREME COURT REPORTS [2007] 13 (Addi.) S.C.R.
~

A also notice that the said decision has been followed in New India
Assurance Co. Ltd. v. Kalpana (Smt.) & Ors., [2007] 3 SCC 538.
23. The expression 'just' must also be given its logical meaning.
Whereas it cannot be a bonanza or a source of profit but in considering
B as to what would be just and equitable, all facts and circumstances must
be taken into consideration.
-
24. In view of our finding abovementioned, the appeal is to be ~ .
allowed in part in so far as the High Court had directed deduction of
medical reimbursement and tax elements on the entire sum which
C according to the statute constitute income. But we decline to do so for
two reasons. Firstly, the accident had taken place as far back as on 1st
September, 1997 and secondly the Tribunal as also the High Court failed
to take into consideration rise in income of the deceased by way of
promotion or otherwise.
D
25. For the aforementioned reasons, we are not inclined to interfere
with the impugned judgment. This appeal is, therefore, dismissed. In the
facts and circumstances of the case, there shall be no order as to costs.
B.B.B. Appeal dismissed.