REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPEALLATE JURISDICTION

CIVIL APPEAL NO.                  OF 2009 (Arising out of SLP (C) No.12255 of 2007)

Meenaben Pankajkumar Joshi & Ors. … Appellants

Versus

New India Assurance Co. Ltd. … Respondent

J U D G M E N T

S.B. Sinha, J.

1. Leave granted.

2. The claimants in a motor accident claims are before us aggrieved by  

and dissatisfied with the judgment and award passed by a Division Bench of  

the High Court of Gujarat whereby and whereunder a judgment and award  

dated  13.12.2005  passed  by  the  Motor  Accidents  Claims  Tribunal,  Fast

Track  Court-4,  Gandhidham –  Kutch  in  MAC  Petition  No.297  of  2005  

(original No.2 of 1998) was modified.

3. The  deceased  Raj  Kumar  Joshi  was  a  Director  of  a  Company  

commonly  known as  Kandla  Clearing  Agency  Private  Limited.   He was  

drawing a salary of Rs.7,500/- per month.  He was, however, also running a  

proprietorship concern carrying on business in ‘Clearing and Forwarding’ in  

the name of Ultra Clearing and Forwarding Company.

Appellants filed a claim petition before the Tribunal claiming a sum  

of Rs.90 lakhs as compensation in respect of the death of the said Raj Kumar  

Joshi who died in a motor vehicle accident and with a view to prove their  

case, appellants, inter alia, filed income ta returns for the assessment years  

1996-97  and  1997-98  disclosing  the  income  from  salary  from  the  

Directorship in Kandla Clearing Agency Private Limited at Rs.66,000/- and  

Rs.90,000/- respectively.  The said returns were accompanied by a certificate  

issued by the Manager/Accountant of the Company.  In the said income tax  

returns, a sum of Rs.12.73 lakhs was also shown as turnover of the business  

for eight months in respect of the said proprietorship concern.  The Tribunal  

passed an award for a sum of Rs.49,25,000/- with proportionate costs and  

interest at the rate of 12% per annum from the date of claim petition till  

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December 2000 and thereafter at the rate of 9% per annum.  Respondent  

No.1  herein  preferred  an  appeal  thereagainst  before  the  High  Court  

questioning the correctness of the said judgment and award.

4. The High Court by reason of the impugned judgment, so far as the  

income of the deceased from the aforementioned proprietorship concern is  

concerned, opined as under :

“Even proceeding on the basis  that  the deceased  had set up another business in the name of Ultra  Clearing and Forwarding Company in May 1997  and even proceeding on the basis that there were  deposits in the bank accounts of the deceased with  State Bank of Bikaner and Jaipur, we cannot at all  approve  of  the  approach  of  the  Tribunal  in  proceeding on the basis that the margin of profit or  margin of commission of the deceased in the said  business  was  to  the  extent  of  20%.   The  very  nature of the business of the deceased being that of  clearing and forwarding agent would mean that the  deceased  would  be  acting  as  an  agent  of  the  consignors  or  consignees  and,  therefore,  such  receipts would to a substantial extent be the price  of the goods being consigned.  The very fact that  after the accident the widow of the deceased filed  income tax  returns  for  the  salary  income  of  the  deceased for the previous years 1995-96 and 1996- 97 but did not file and income-tax return for the  subsequent  year  i.e.  1997-98  for  the  alleged  business  income  allegedly  earned  between  May  and October 1997 belies the claimants’ case that  the deceased was getting substantial income from  the business being carried on by him in the name  of Ultra Clearing and Forwarding Company.  We  

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are,  therefore,  shocked  to  find  that  the  Claims  Tribunal  accepted  the  claimants’  case  about  the  alleged income of the deceased from the business  in  the  name  of  Ultra  Clearing  and  Forwarding  company without making any probe into such tall  claim and without testing the claimants’ case even  on the touchstone of commonsense.”

(Empnasis supplied)

So far as the question with regard to the applicability of the Indian  

Evidence Act is concerned, the High Court while opining that the strict rules  

of evidence would not apply to the claim proceedings before the Tribunal,  

held as under :

“The foregoing discussion would show that there  was no evidence on record before the Tribunal to  arrive at the conclusion that on the credit amount  of  Rs.12.73  lakhs,  the  deceased  was  getting  commission of 20% as held by the Tribunal.  The  finding of the Tribunal on this score is, therefore,  not only incorrect and unwarranted, but to say the  least, perverse.  No reasonable person instructed in  this  branch  of  law  would  ever  arrive  at  such  conclusion  that  the  deceased  was  getting  commission of 20% of the gross deposits made in  his bank accounts.  The finding can never be said  to be based on judicial considerations.”

The High Court also interfered with the rate of interest opining that  

the rate of interest should be fixed at 9% per annum from the date of the  

claim till the date of deposit.

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5. Mr. K.V. Vishwanathan, learned senior counsel appearing on behalf  

of the appellant,  would contend that the High Court committed a serious  

error insofar as it held that a forwarding and clearing agent dealt with goods.  

It was urged that the expenditures required to be incurred by a clearing and  

forwarding  agency  will  depend  upon  the  expenditures  required  to  be  

incurred in terms of the agreement as clearing and forwarding agent does not  

deal with sale of goods and as such the question of payment of any price of  

the goods being consigned would not arise.

6. Before us, an application has been filed seeking permission to reply  

upon additional documents containing various bills, debit notes, etc. to show  

the nature of expenditure incurred by the said proprietorship concern.

7. Having heard the learned counsel for the parties, we are of the opinion  

that keeping in view the provisions of Section 168 of the Motor Vehicles  

Act,  1988  in  terms  whereof  the  Tribunal  is  required  to  award  a  fair  

compensation,  the additional  documents sought to be produced before us  

should  be  taken  into  evidence.   We say  so  because  the  appellants  have  

contended  that  those  documents  were  not  available  at  the  relevant  time.  

Evidently, they have not been brought on records before the Tribunal also.

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8. We, therefore, are of the opinion that the interest of justice would be  

subserved  if  the  matter  relating  to  award  of  compensation  is  considered  

afresh by the Tribunal upon taking additional documents placed before us as  

additional evidence.  The claimants unless admit or formal proof thereof is  

dispensed with, may prove the said documents by examining witnesses.  The  

respondents, it goes without saying, would be entitled to cross-examine the  

said witnesses produced on behalf of the appellants and would furthermore  

be entitled to examine their witnesses in this behalf.  We make it clear that  

all other findings arrived at by the Tribunal and as modified by the High  

Court shall remain undisturbed.

9. The appeal is allowed to the aforementioned extent and the matter is  

remanded  to  the  Tribunal  with  the  aforementioned  directions  and  

observations.  However, in the facts and circumstances of this case, there  

shall be no order as to costs.

.……………………….J. [S.B. Sinha]

……………………..…J.     [Deepak Verma]

New Delhi; August 7, 2009

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