First Appeal No. 729 of 2004

19th September, 2013

Petitioner Counsel: Mr. S.N. NAIK
Respondent Counsel: Mr. A.R. PATIL

Cases Cited:
Sarla Verma & Ors. Vs. Delhi Transport Corporation & Anr., 2009(4) ALL MR 429 (S.C.)=AIR 2009 SC 3104 : JT2009 (6) SC 495 [Para 3,6,9]
Santosh Devi Vs. National Insurance Company Limited and Others, 2012 ALL SCR 1292=(2012) 6 SCC 421 [Para 3,6]
Rajesh and others Vs. Rajbir Singh and others, 2013 ACJ 1403 [Para 6,11]
Vimal Kanvar & others Vs. Kishore Dan & others, 2013 ALL SCR 1634 =JT 2013 (8) SC 234 [Para 6]
Reshma Kumari Vs. Madan Mohan, 2013(3) ALL MR 460 (S.C.)=JT 2013 (4) SC 362 [Para 6]
National Insurance Co.Ltd Vs. Indira Srivastava & others, 2008 ALL SCR 574 =2008 AIR SCW 143 [Para 7]
Raghuvir Singh Matolya Vs. Hari Singh Malviya, 2009 ALL SCR 826 =(2009) 15 SCC 363 [Para 8]
Nagappa Vs. Gurudayal Singh, AIR 2003 SC 674 [Para 10]
State of Haryana Vs. Naresh Kumari and others, 2000 ACJ 1394 (P&H) [Para 13]
Leela Gupta Vs. State of U.P and others, 2010(6) ALL MR 942 (S.C.)=2010 ACJ 2717 [Para 13]

JUDGMENT

JUDGMENT :- The appeal is directed against the Judgment and Award dated 8th December, 2003, whereby the learned Member of the Motor Accident Claims Tribunal, Thane in Claim Petition No. 755/1997 awarded total compensation in the sum of Rs. 3,50,000/- only inclusive of no fault liability. The Tribunal also awarded payment of interest at the rate of 6% per annum on the awarded sum from the date of the application, till realization. The claim was made in the sum of Rs 6,00,000/- (Six Lakhs) before the Tribunal. After hearing the learned Advocate as well as Assistant Government Pleader representing the parties and after careful perusal of the evidence available on record at thread bare, including the impugned judgment and award passed by the Tribunal, the only point that arises for my consideration is:

Whether the compensation awarded by the Tribunal in the sum of Rs. 3,50,000/-is just and proper? My answer is in the emphatic negative as compensation awarded by the Tribunal need to be enhanced for following reasons:-

2. The finding regarding liability recorded by the Tribunal is not in dispute. The fact that young Chintaman, aged about 35 years died in road accident involving the motor vehicles Motor Cycle bearing registration no. MH-04-W-6135 and the Police Van registration no MH-12-F-5804 is not in dispute. It is not disputed that the Police Van bearing was owned by Respondent State (Respondent no. 1) as on the date of the motor vehicle accident in the present case. Thus question which is to be answered in this appeal is, as to what is quantum of just and fair compensation, which could have been awarded to the claimants/dependents of the young victim Chintaman, who died in the motor vehicle accident at the age of 35 years.

3. Learned Advocate for the appellants made a grievance that amount of compensation awarded by the Tribunal was utterly inadequate, as according to Mr Naik, the victim young Chintaman was only daily bread earner for the family serving in as Head Clerk in Soil Conservation Office, Wada, earning about Rs. 4326/- per month according to PW-1 Chitra, who deposed as claimant and PW-3 Shantaram, Assistant Superintendent in the same office where deceased had worked, who deposed before the Tribunal. Learned Advocate Mr.Naik for the appellants, therefore, contended with reference to ruling in Sarla Verma & Ors. V/s Delhi Transport Corporation & Anr., reported in AIR 2009 Supreme Court 3104 : [2009(4) ALL MR 429 (S.C.)] as also making reference to ruling in Santosh Devi V/s National Insurance Company Limited and Others, reported in (2012) 6 Supreme Court Cases 421 : [2012 ALL SCR 1292], to argue that even in cases of self-employed victims, increases in their income prospectively ought to be considered by the tribunal while granting reasonably just and adequate compensation.

4. According to learned Advocate Mr.Naik, there were parents of the victim as well as Widow and three minor children solely dependent on him. Thus, six members in the family were left behind by victim Chintaman who died in the accident at young age. Thus, it is contended that prerevised salary amount of Rs 4326/- was income of the deceased Chintaman. His revised total Salary was Rs 5368/- with basic pay as Rs 4600/- His Salary was Rs 5368/- minus Tax of Rs 60/= 5308/- plus also considering prospective increases in his income at 50% of Rs 5308/= Rs.7962. Then considering six dependents of the victim, Tribunal ought to have considered his daily income after deduction of 1/4th towards his personal expenses =Rs 5972/-. Taking the loss of dependency at Rs 5970/- per Month X 12 =71640/- Multiplier of '16' is applicable as indicated in Sarla Verma's case. Thus Rs 11,46,240/- with interest at the rate of Rs 9% per annum apart from non-pecuniary damages at least in the sum of Rs.55,000/- (50,000/- loss of love and affection, consortium and Rs 5000/- toward funeral expenses and transport etc) would be sum of Rs 12,01,240/- as reasonable compensation. Learned AGP for the respondents who sought to support the impugned Judgement and award on the ground that the victim was an employee and left behind parents and minor Children namely Chetan, Dhanesh and Sweta who are now grown up children, could earn and marry in near future. According to learned AGP, the compensation awarded by the Tribunal was adequate.

5. It is true that if monthly income of deceased victim Chintaman is considered as on the date of the accident i.e 22-06-1997 at the rate of Rs. 4326/- per Month then to include his revised salary and future prospects of increasing incomes, at Rs 5308/- minus Tax then after deducting the sum of 1/4th amount which could have been spent by him towards his personal expenses, the monthly income of the deceased Chintaman could have been considered reasonably as Rs. 5970/- per month as available to his dependents and annual income at Rs. 71640/- for an employed person as Soil Conservation official. Considering the 35 years age of victim Chintaman at the time of his death in the accident, young Chintaman would have lived long till the age of 60 years at least on account of reasonable expectancy of his life for to support his family. Hence, applying maximum multiplier of "16" even in accordance with statutorily predetermined structured formula in the Second Schedule with reference to Section 163-A of the Motor Vehicles Act, 1988 could have been considered proper when the claim application was decided. Learned Member of the Tribunal was in clear error of law not to consider it. Thus, roughly calculated annual income of Rs. 71640/- per year multiplied by appropriate multiplier of "16", total loss of dependency for dependents would come to Rs. 11,46,240/- (capitalised loss of dependency) to which if sum of Rs. 50,000/- is added as compensation (non-pecuniary damage) for loss of love and affection and loss of enjoyment for the family members of the victim and sum of Rs. 5000/- towards reimbursement for funeral expenses and transport expenses, the amount of compensation could have been awarded at least in the sum of Rs. 12,06,240/- along with interest at the rate of Rs. 9% per annum on the unpaid awarded amount from the date of application till realization thereof. The compensation amount would include the amount awarded under Section 140 of the Motor Vehicles Act as no fault liability for which compensation at interim stage was granted.

6. I have considered the submissions in the light of galaxy of rulings cited before me in Sarla Verma & Ors. V/s Delhi Transport Corporation & Anr. Reported in AIR 2009 Supreme Court 3104 : [2009(4) ALL MR 429 (S.C.)] as also ruling relied upon in Santosh Devi V/s National Insurance Company Limited and Others, reported in (2012) 6 Supreme Court Cases 421 : [2012 ALL SCR 1292]. The ruling in Rajesh and others V/s Rajbir Singh and others, by three Judges' Bench of the Apex Court, reported in 2013 ACJ 1403 and the ruling in Vimal Kanvar & others Vs Kishore Dan & others Jt 2013 (8) SC 234 : [2013 ALL SCR 1634] and the ruling in Reshma Kumari Vs Madan Mohan JT 2013 (4) SC 362 : [2013(3) ALL MR 460 (S.C.)] would support the aforesaid contention for the submission advanced by Mr. Naik, learned Advocate for the appellants.

7. There are no fetters on the power of the Tribunal to award compensation even in excess of the amount which is claimed in the application if warranted by the proved facts and circumstances of the case. The object is to restore the dependents-claimants to the pre-accidental position, as far as possible by compensating the family in monetary terms for loss of their victim family member. It is duty of the Tribunal or the Court to award just, equitable, fair and reasonable compensation irrespective of the amount claimed in such cases bearing in mind the social welfare objective of the Motor Vehicles Act to adequately compensate the victims of the motor vehicle accidents or their family members who are rendered helpless, aggrieved and disadvantaged by untimely demise of earning member of their family i.e. the victim. In such cases dependents are often left behind impoverished or impecunious after having lost their only bread earner in the family. They need to satisfy basic wants of their life. It is indisputable that increasing inflation or rising prices of essential commodities and education make it increasingly difficult for them to survive and obtain basic necessities in life -subsistence- for their livelihood and also education of minor students in family. and therefore increasing judicial trends in computing higher personal incomes regard being had to facts and circumstances and evidence in each case ought to be borne in mind by the Tribunals and Courts so as to award just and reasonable amounts for to adequately compensate dependents of the deceased for loss of future prospects as well. In National Insurance Co.Ltd Vs Indira Srivastava & others reported in 2008 AIR SCW 143 : [2008 ALL SCR 574] in Para 17 Hon'ble Supreme Court observed thus:

"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 contra-distinguished 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".

8. 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 contra-distinguished to the ones which were for his benefit. But from the said amount of total income, the statutory amount of tax payable thereupon must be deducted. In Raghuvir Singh Matolya Vs. Hari Singh Malviya ((2009) 15 SCC 363) : [2009 ALL SCR 826], Hon'ble Supreme Court has observed that dearness allowance and house rent allowance should be included for computation of income of the deceased.

9. In Sarla Verma Vs Delhi Transport Corporation JT2009 (6) SC 495 : [2009(4) ALL MR 429 (S.C.)] in para 30 guideline as to deduction towards personal expenses were given thus:-

"Though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in Trilok Chandra, the general practice is to apply standardized deductions. Having considered several subsequent decisions of this court, we are of the view that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependant family members is 4 to 6, and one-fifth (1/5th) where the number of dependant family members exceed six."

10. We may also refer to the ruling in Nagappa v. Gurudayal Singh, AIR 2003 SC 674 wherein the Apex Court has held that the Court is required to determine just compensation and there is no other limitation or restriction for awarding such compensation and in appropriate cases where from the evidence brought on record if the Tribunal/ Court considers that the claimant is entitled to get more compensation than claimed, the Tribunal may pass such award and would empower the Court to enhance the compensation at the appellate stage even without the injured filing an appeal or cross-objections.

11. It is also essential to award non-pecuniary damages such as for loss of love and affection for family members, loss of consortium for widow if she is dependent, loss of guidance, estate etc which are special damages in fact uncompensatable in monetary terms, of course the caution is that the award ought not be a jackpot for the claimants to quickly enrich them. It is not object of law to unduly enrich the dependents of the victim by making them wealthier at the cost of public money held by the insurance companies. The intent of awarding non-pecuniary damages is to provide just, fair, reasonably adequate compensation so as to provide a corpus to take care of the subsistence of the dependents in future as well, hence such sums are also required to be added to the compensation amount properly and relevantly calculated with reference to facts of each case on the basis of monthly /yearly income proved by the claimants before the Tribunal so as to arrive at just and reasonable compensation irrespective of any amount claimed by the claimants. In the case of Rajesh and others (cited supra) Hon'ble the Supreme Court has held that in a given case when the deceased was self-employed or working on fixed wages, and if the deceased was below 40 years, there shall be addition of 50 percent of income of the deceased towards future prospects. This addition shall be 30% in case the deceased was aged between 40 to 50 years. In paragraph 12 of the judgment Hon'ble Supreme Court has held, it would be just and equitable to provide an addition of 15 per cent in the case wherein the victim is between the age group of 50 and 60 years so as to make the compensation just, equitable, fair and reasonable. There shall normally be no addition thereafter. Thus in the case of Rajesh and others three judges bench of the Hon'ble Supreme Court has held that, the benefit of increase of income for future prospects is available not only to the victims where the deceased was in secured employment, but also to the victims where the deceased was self-employed or employed on fixed wages. The Hon'ble Supreme Court has further extended this benefit even to the cases where deceased persons in the age group of 50 to 60 years. The addition of sums by way of future prospects without there being discrimination between dependents of deceased persons who were in secured employment and dependents of deceased persons who were self-employed or working on fixed wages would render the compensation award just, equitable, fair and reasonable.

12. Considering the submissions at the bar and the rulings cited and cognizant of the facts and circumstances of the present case, I think the calculations as suggested by learned Advocate for the appellant need to be partly accepted as just and reasonable suggestion for to provide adequate compensation on account of death of young Chintaman in the motor vehicle accident payable to his dependents in the present case. Even after considering imponderables, such as - early demise or death of parents, marriages of all his children in near future etc., the calculation of compensation as above would be just, equitable, reasonable and proper.

13. Bearing in mind the addition of amount to be made by way of future prospects the reasonable and just compensation must be computed in the case in hand .Monthly income of the deceased after deduction of 1/4th amount (considering six members in his family at the time of his death) from his average Monthly earning of Rs 7962/- inclusive of future prospects of increasing incomes is calculated. Annual income for dependents is calculated in the sum of (5970 x 12) Rs. 71640/- per annum multiplied by "16" as proper multiplier considering young age of the victim, amount comes to Rs.11,46,240/-. (Capitalised loss of dependency for claimantsdependents). In addition, at least sum of Rs.50,000/- ought to be reasonably granted by way of compensation towards loss of love and affection for the family members of the victim and sum of Rs. 5000/- spent towards funeral expenses and transport. We can thus arrive at just ,fair and reasonable compensation in the sum of Rs. 12,01,240/- inclusive of no fault liability, with reasonable interest @9% p. a. on the unpaid amount from the date of the claim application till the amount is deposited by the owners of the offending vehicle . The balance of remaining amount unpaid would carry reasonable interest at the rate of Rs. 9 % per annum till full realization thereof. Learned Advocate for the Appellant did prayed for higher rate of interest at 12% p.a. Placing reliance upon the ruling in State of Haryana Vs. Naresh Kumari and others reported in 2000 ACJ 1394 (P&H). learned AGP invited my attention to the fact that the Apex Court awarded 9% interest p.a. On the enhanced amount of compensation in Leela Gupta Vs State of U.P and others reported in 2010 ACJ 2717 : [2010(6) ALL MR 942 (S.C.)]. Hence reasonable interest would be 9% p.a. On the enhanced amount of compensation. Before parting with the order it is desirable that the portion of the capitalised compensation ought to be invested in such manner in the valuable security such as fixed deposit in any nationalised Bank so as to fetch regular recurrent income for the subsistence of the aged and poor, needy claimants in the case. Hence, following order is passed.

ORDER

1) Appeal is partly allowed.

2) Award is modified while allowing compensation as follows :-

(a) Parents and dependent widow of the victim are entitled to the sum of Rs.12,01,240/- (inclusive of no fault liability and enhanced amount herein) along with interest on the enhanced amount at the rate of Rs. 9% per annum from the date of application till deposit thereof in the Tribunal / Court and balance amount due shall carry the interest payable @ 9% p.a. till realization of the full compensation. The amount already paid as compensation and interest shall be adjusted and deducted accordingly by the Tribunal.

3) Record and Proceedings be sent back to Motor Accident Claims Tribunal, Thane to enable it for determine disbursal of the compensation as ordered herein with latitude to issue directions for investment as to fixed deposit etc of the portion of the compensation amount as it may deem fit, to ensure timely and recurrent future assistance, to provide continued periodical subsistence for the poor, needy claimantsdependents enabling them to withdraw the interest accrued periodically. The amounts deposited in this Court with interest accrued shall be sent back to the Tribunal for to enable it to do the needful for proper and effective execution of the Award . The appeal is allowed with costs accordingly.

Appeal partly allowed.