Gujarat High Court
National vs Thakor on 26 September, 2008
Author: H.K.Rathod
Bench: H.K.Rathod
Gujarat High Court Case Information System
Print
FA/4791/2008 26/ 26 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL No. 4791 of 2008
For
Approval and Signature:
HONOURABLE
MR.JUSTICE H.K.RATHOD
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1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To be
referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the civil judge ?
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NATIONAL
INSURANCE CO LTD - Appellant(s)
Versus
THAKOR
VIRAMJI GORDHANJI & 3 - Defendant(s)
=========================================================
Appearance
:
MR
MEHUL SHARAD SHAH for
Appellant(s) : 1,
MR HARSHIT S TOLIA for Defendant(s) : 1 -
2.
None for Defendant(s) : 3 -
4.
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CORAM
:
HONOURABLE
MR.JUSTICE H.K.RATHOD
Date
: 26/09/2008
ORAL
JUDGMENT
Heard learned advocate Mr. Mehul Sharad Shah on behalf of appellant, learned advocate Mr. HS Tolia appearing for respondent claimants on caveat.
The appellant insurance company has challenged award passed by Motor Accident Claims Tribunal, Patan in MACP no. 5324/2002 old MACP no. 410/1994 vide exh 38 dated 30/4/2008. The claims Tribunal has awarded Rs. 2,04,500/- with 9% interest in favour of respondent claimants.
Learned advocate Mr. Shah raised contention that whether in case of minor how much amount is to be awarded is referred to larger bench by Division Bench of this Court in FA no. 2720/2005 dated 20/9/2006. Therefore, this appeal may also be transferred to larger bench.
He submitted that amount of compensation, which is awarded in case of minor while considering second schedule in 166 application is clear error committed by claims Tribunal.
He also submitted that Apex Court in various cases awarded lesser amount then awarded by claims Tribunal. Therefore, claims tribunal has committed gross error. He submitted that while considering question of compensation for minor family back ground of claimant is also necessary to be taken into account.
He raised contention that 1/3 deduction in case of minor is also contrary to law and age of claimant is also necessary to be considered by claims Tribunal.
He relied upon following decisions in support of his contentions in case of Kaushalya Devi Vs. Karan Arora reported in 2007 (7) SCALE 517, Ramesh Singh and Another Vs. Satbir Singh and another reported in 2008 (2) SCC 667, New India Assurance Co. Ltd Vs. Satender & Ors reported in AIR 2007 SC 324, Shakuntala and Others Vs. Balkrishna and Others reported in 2003 ACJ 1557.
Except that no other submission is made by learned advocate Mr. Shah.
Learned advocate Mr. Tolia appearing for respondent claimants supported award passed by claims Tribunal.
I have considered submissions made by both learned advocates and perused award passed by claims tribunal. Application was filed by claimants u/s 166 of Motor Vehicles Act.
The accident occurred on 4/5/1994, when at about 3.30 deceased Parag, a child was grazing animals, at that time, truck No. GJ-1-J-5980 driven by opponent no. 2 dashed to child and due to that child received injuries on head, leg and hand, which resulted into death of deceased while going to treatment of child. The deceased was aged about 12 years and claim was made by claimants for Rs. 4,80,000/-, but it was limited upto Rs. 3,00,000/-.
The deceased boy was helping to father and mother in their work as well as studying in school. He was only son in family. After receiving notice from claims tribunal, present appellant insurance company has filed reply vide exh 20 and denied averment made in claim petition. They require proof of each statement made by claimants in claim petition. The claims Tribunal has framed issued vide exh 17 and vide exh 30 Thakor Viramji Gordhanji was examined. The copy of complaint vide exh 31, Panchnama vide exh 32, PM report vide exh 33, insurance policy vide exh 34 and vide exh 35 charge sheet was produced. It is necessary to note that no oral evidence or documentary evidence produced by insurance company before claims Tribunal.
After hearing both learned advocates, claims Tribunal has examined question of negligence and come to conclusion that it was a negligence of opponent no. 2 while driving truck, dashed with child. The insurance company has not challenged that accident was not occurred at all. The respondent no. 1 and 2 owner and driver not appeared before claims Tribunal. Therefore, claims Tribunal has come to conclusion that accident occurred due to rash and negligent driving of opponent no. 2.
On behalf of insurance company, certain decisions were cited before claims Tribunal and contention was raised that in case of minor 2/3 dependency is not available to claimants only 1/3 is available.
The claims Tribunal has relied upon two decisions of Apex Court reported in 2003 ACJ 699 and 2002 ACJ 559 and held that in case of unmarried boy, claimants father and mother are entitled 2/3 dependency. The claims Tribunal has considered that in determining and assessing income of deceased child having guidance from second schedule and notional income of Rs. 15000/- has been assessed by claims Tribunal.
The claims Tribunal has also relied upon decision of this Court in FA 1697/2003 in case of National Insurance Co. Ltd Vs. Talshi Vagha Koli, where in case of child 20 multiplier is applied and compensation of Rs. 2,00,000/- was awarded after deducting 1/3 amount for personal expenses. Therefore, claims Tribunal has relied upon decision of this Court and come to conclusion that Rs. 2,00,000/- being a compensation to be awarded to claimants and Rs. 4500/- for funeral expenses. In all compensation of Rs. 2,04,500/- has been awarded to claimants by claims Tribunal with 9% interest.
I have considered contention raised by learned advocate Mr.Shah that question as to how much compensation is to be awarded to claimants in case of death of a child and whether 1/3rd deduction is necessary or 2/3rd is pending before larger bench and, therefore, this appeal may be referred to larger bench. I am not accepting this contention because Division bench of this Court has referred question to larger bench, but that does not mean that this appeal is to be remained pending before this Court till the decision of larger bench. As and when larger bench will examine issue, it will be binding to Court, meanwhile, if any matter come, Court should have to examine it in accordance with law.
Therefore, contention raised by learned advocate Mr. Shah is not accepted. The decisions, which has been relied by learned advocate Mr. Shah where after considering facts of each case, Apex Court has fixed amount of compensation and each case are having different facts. There is no ratio decided by Apex Court that in case of child this much compensation is only available, but depend upon facts and circumstances of each case, Apex Court has awarded compensation.
The claims Tribunal has rightly relied decisions of Apex Court as well as this Court and applied mind that claimants are entitled how much compensation in case of death of child in accident, for which, there is no ratio decided by Apex Court except on different facts, different figure has been awarded by Apex Court.
Therefore, according to my opinion, looking to death of child, who was aged about only 12 years and there was no fault on his part and died due to dashed of opponent no. 2 driver of Truck no. GJ-1-J-5980 which resulted into injuries of head, leg and hand and while going to treatment boy died who was only a son in family. The claimants father and mother aged about 33 and 35 years. The claims Tribunal has rightly awarded compensation in favour of claimants.
Learned advocate Mr. Shah submitted that amount of compensation is to be fixed by claims Tribunal after considering surrounding circumstances and financial condition of claimant in their environment of life. According to him, in case of millionaire, he may be entitled more amount of compensation and son of poor person entitled less amount. So, according to his submission, compensation is depend upon facts that child of rich person died or child of poor person died. The child of poor person is having less value of life and child of rich person is having more than value of life. This submission made by learned advocate Mr. Shah can not be accepted as Motor Vehicles Act is enacted for both type of child whether child of rich fellow or whether child of poor fellow. The son of poor fellow died is more relevant that poor person have no other source of income in life except son, who can maintain them in past life. On the contrary, rich fellow is having more financial support, even in absence of son, claimant can easily enjoy past life.
Therefore, this contention itself is unreasonable and can not be applied while determining compensation under provision of Motor Vehicles Act 1988. According to my opinion, ultimately, this Court has to consider that child after becoming major, at least irrespective of income earn by child, where definitely to consider that child must have maintain father and mother. The accident occurred on the year 1994, 14 years have passed in deciding this case. So, if amount of compensation awarded to claimant and it is invested in any Nationalized bank, then, father and mother at least get amount of interest from FDR, so, they may easily maintain subsequent period of life.
Looking to current rate of interest 7.5% and amount of compensation, according to my opinion, father and mother may able to get Rs. 2000/- to Rs. 3000/- by way of interest and they can maintain themselves. That view has been taken by apex Court reported in 2005 (8) SCALE 173 and by this Court reported in 2006 (11) GHJ 552, where principle has been examined that while considering amount of compensation, whether it is just and proper or reasonable or not? This Court should have to consider if this much amount is invested in any Nationalized Bank, then reasonable amounts of interest received,then it can consider to be reasonable, just and proper compensation. Looking to fact of this case, according to my opinion, just, reasonable and proper compensation has been awarded by claims Tribunal.
It is also necessary to consider one important aspect, that this Court is not referring this matter to larger bench on the ground that 12 years boy died in accident on 4/5/1994, 14 years period is over, till date except application u/s 140, claimants have not received single pai from Insurance company. So, family remained without any amount for a period of 14 years when 12 years son died, who become about 26 years old, definitely, he maintain family without any difficult. If this matter, will go before larger bench we do not know when larger bench will examine issue though two years have passed while referring matter by division Bench of this Court on 20/9/2006. However, it is uncertain that how much time will be taken by larger bench, then agony of claimant will remain continue without any justification when award is passed by claims Tribunal in their favour is reasonable, just and proper.
Therefore, according to my opinion, now to refer larger bench, because of such question is pending, is not in interest of justice. Therefore, this matter is required to be decided by this Court in accordance with law prevailed at this time.
I have considered contention raised by learned Advocate Mr. That while dealing with application under section 166 of MV Act, it is not open for claims tribunal to consider case of claimants under the provisions of sec.163A read with Second Schedule. In facts of this case,claims tribunal has considered notional income having guidance from Schedule II, Rs.15000/- and thereafter, 1/3rd has been deducted considering Schedule II in case of death of 12 years old boy and applied multiplier of 20 relying upon Schedule II. In respect of this contention raised by learned Advocate Mr. Shah, I have considered decision of Division Bench of this Court in case of Champaben, W/o. Chndrasinh Dhulabhai Rathod & Ors. v. Anopsinh Somabhai Baria & Ors.,reported in 2007(2) GLR page 1663. Division Bench of this Court has considered that while adopting multiplier from Second Schedule, it would not be unreasonable to apply it in case where annual income of deceased/victim was Rs.80,000/-. Division Bench of this Court has relied upon some of decisions of apex court where even in case of an application under sec. 166 of MV Act, 1988, guidance has been taken from second schedule which provides for adopting multiplier, notional income and 1/3rd deduction. Relevant observations made by apex Court in para 15, 16, 17, 18 and 19 are reproduced as under:
?S15. Upon analysis of various decisions of the Apex Court cited at the Bar, the first thing to be made clear is that the observations regarding the multiplier method in general are made in context of two different methods adopted to determine and calculate compensation in fatal accident actions. The first method was the Multiplier method as explained in Davies case, (1942) AC 601 and the other one in Nance case(1951) AC 601. While in the first method i.e. the multiplier method, popularly so called, the amount of dependency benefit or loss to the claimants i.e. multiplicand is to be straightway capitalised by an appropriate multiplier depending on the age of the deceased (or that of the claimants, whichever is higher) and several other considerations depending on the rate of interest and the period over which the capital would also be consumed up apart from the annual interest. In the Nance method, loss of dependency benefits or the multiplicand is first multiplied by number of years based on the life expectancy of the deceased and probable length of working life of deceased from the date of accident. This amount is to be then reduced taking into account the various contingencies of life such as illness, disability and unemployment etc.
16. It is in this context of the above distinction between two methods that the Courts have preferred to adopt the multiplier method (Davies method)where an appropriate multiplier is adopted for the purpose of multiplying the loss of dependency or the multiplicand and 18 is considered to be the highest multiplier for computing compensation for loss of dependency benefits in fatal accident cases.
17. It is also true that in the two Judge Bench decisions rendered in the year 2000 and 2002 viz. Jyoti Kaul and others v. State of M.P. and another(supra), decided on February 8,2000 and United India Insurance Co. Ltd and others v. Patricia Jean Mahajan and others(supra), decided on July 8, 2002, the Apex Court leaned in favour of adopting the multiplier as indicated in the Second Schedule barring exceptional circumstances such as a very huge amount of multiplicand. In the later decisions of two Judge Bench rendered more recently in the years 2005 and 2006 indicated in para-13 here-in-above, the trend is to adopt a lower multiplier than the one indicated in the Second Schedule.
18. We cannot however, overlook the three Judge Bench decision in Supe Dei and others v. National Insurance Co. ltd. and another 2002 ACJ 1166 in terms holding that :
?SThe position is well settled that the Second Schedule under section 163-A to the Act which gives the amount of compensation to be determined for the purpose of claim under the section can be taken as a guideline while determining the compensation under section 166 of the Act.??
In that case, the deceased was aged 32 years on the date of accident which took place in the year 1997. The deceased was drawing salary of Rs. 4,000/- per month including the overtime allowance of Rs. 2,000/- per month. The Tribunal adopted multiplier of 15 and awarded compensation of Rs. 5,42,000/-. On appeal, the High Court excluded the overtime allowance from the monthly income and determining the net income of the deceased at Rs.1515/- per month awarded compensation of Rs. 3,15,000/-. The Apex Court accepted the claimants' contention that no reason was given by the Tribunal or High Court for fixing 15 as multiplier when the Schedule provided for multiplier of 17. The Apex Court also enhanced the rate of interest from 6% to 9%, after referring to the decision in the case of Kaushnuma Begum v. New India Assurance Co. ltd. (supra), wherein also two Judge Bench had leaned in favour of adopting multiplier as contained in Second Schedule.
19. Having regard to the facts in Supe Dei and others v. National Insurance Co. ltd.
and another(supra), decided by a three Judge Bench and particularly the amount of monthly income which was determined by the High Court at only Rs. 1515/- it is again necessary to refer to the observations made by the two Judge Bench in United India Insurance Co. Ltd and others v. Patricia Jean Mahajan and others(supra), that the structured formula as provided under the Second Schedule is to be applied in case of victims whose income is upto Rs. 40,000/- per annum. In paragraph 20 of the said decision, it is specifically mentioned that the Second Schedule while prescribing the multiplier, had maximum income of Rs.40,000/- p.a. in mind, but it is considered to be a safe guide for applying the prescribed multiplier in cases of higher income also except in cases where the gap in income is very wide. Section 163-A read with Second Schedule was inserted in the M.V. Act, 1988 in the year 1994. Hence having regard to the fact that Consumer Price Index in the year 1994 was 1370 and the Consumer Price Index in the year 2005 was 2712, while adopting the multiplier from the Second Schedule, it would not be unreasonable to apply it in cases where annual income of the deceased/victim was Rs.80,000/-. We find that all the cases where the Apex Court adopted the multiplier from the Second Schedule were cases where the annual income of the victim was less than Rs. 40,000/- or slightly higher.
We also cannot overlook the fact that Section 163A provides for structured formula of compensation on the basis of actual income of the deceased on the date of the accident and consideration of future prospects is not provided under section 163 A. ?S In view of the above observations made by Division Bench of this Court after considering various decisions of apex court, according to my opinion, claims tribunal has rightly taken guidance from Second Schedule in case of death of 12 years old boy keeping in mind notional income and 20 multiplier and future prospective income after deducting 1/3rd amount cannot be considered to be unreasonable in any manner and that also cannot be considered to be illegal or without jurisdiction. Law is very much settled on this issue that while considering an application under sec. 166 of MV Act, claims tribunal can consider second schedule for arriving at proper, reasonable and just compensation to victim or claimant. It cannot be considered to be illegality or without jurisdiction and there is no bar provided under the provisions of MV Act that while considering an application under sec. 166 of MV Act, claims tribunal cannot look into second schedule given in MV Act, therefore, contention raised by learned Advocate Mr. Mehul Sharad Shah cannot be accepted and same is, therefore, rejected.
Learned advocate Mr. Shah relied upon decision of Apex Court in case of New India Assurance Co. Ltd Vs. Satendra and Ors reported in 2006 (ii) SCALE 589 = AIR 2007 SC 324, where Apex Court has considered how to assess compensation in case of child died in accident. The Apex Court has considered that in young children of tender age, in view of uncertainties of life, neither their income at the time of death nor the prospects of future increase in their income nor chances of advancement of their career are capable of proper determination on estimated basis. In case of Lata Wadhwa and Ors Vs. State of Bihar and Ors reported in 2001 (8) SCC 197, Apex Court has made distinction while computing compensation between deceased children falling within the age group of 5 to 10 years and age group of 10 to 15 years. The reported facts of Satendra as referred above child Anju aged about 9 years old where Apex Court has awarded Rs. 1,80,000/- considering case of Jasbir Kaur reported in 2003 (7) SCC 484, against in present case of fact deceased boy who died in accident aged 12 years. Therefore, naturally, in case of Satendra 9 years girl, Apex Court has awarded Rs. 1,80,000/-. Looking to age of 12 years boy in fact of this case, claims Tribunal has awarded Rs. 2,04,500/- which can not be considered to be in any manner being unreasonable or arbitrary compensation. On the contrary decision which relied by learned advocate Mr. Shah is not helpful to his submission, but helpful to case of claimant as per decision given by Apex Court in case of Lata Wadhwa.
The relevant decision made in case of Satendra in para 7 to 13 are quoted as under:
?S7. In Mallett v.
McMonagle 1970 (AC) 166, Lord Diplock analysed in detail the uncertainties which arise at various stages in making a rational estimate and practical ways of dealing with them. In Davies v. Taylor (1974) AC 207, it was held that the Court, in looking at future uncertain events, does not decide whether on balance one thing is more likely to happen than another, but merely puts a value on the chances. A possibility may be ignored if it is slight and remote. Any method of calculation is subordinate to the necessity for compensating the real loss. But a practical approach to the calculation of the damages has been stated by Lord Wright in Davies v. Powell Duffryn Associated Colleries Ltd. (1942) 1 All ER 657, in the following words:
"The starting point is the amount of wages which the deceased was earning, the ascertainment of which to some extent may depend on the regularity of his employment. Then there is an estimate of how much was required to be spent for his own personal and living expenses. The balance will give a datum or basic figure which will generally be turned into a lump sum by taking a certain number of years' purchase."
8. In State of Haryana and Anr. v. Jasbir Kaur and Ors. (2003(7) SCC 484) it was held as under:
"7. It has to be kept in view that the Tribunal constituted under the Act as provided in Section 168 is required to make an award determining the amount of compensation which is to be in the real sense "damages"
which in turn appears to it to be "just and reasonable". It has to be borne in mind that compensation for loss of limbs or life can hardly be weighed in golden scales. But at the same time it has to be borne in mind that the compensation is not expected to be a windfall for the victim. Statutory provisions clearly indicate that the compensation must be "just" and it cannot be a bonanza; not a source of profit; but the same should not be a pittance. The courts and tribunals have a duty to weigh the various factors and quantify the amount of compensation, which should be just. What would be 'just" compensation is a vexed question. There can be no golden rule applicable to all cases for measuring the value of human life or a limb. Measure of damages cannot be arrived at by precise mathematical calculations. It would depend upon the particular facts and circumstances, and attending peculiar or special features, if any. Every method or mode adopted for assessing compensation has to be considered in the background of 'just" compensation which is the pivotal consideration. Though by use of the expression "which appears to it to be just" a wide discretion is vested in the Tribunal, the determination has to be rational, to be done by a judicious approach and not the outcome of whims, wild guesses and arbitrariness. The expression 'just" denotes equitability, fairness and reasonableness, and non-arbitrary. if it is not so it cannot be just. (See Helen C. Rebello v. Maharashtra SRTC (1999(1) SCC 90)
9. There are some aspects of human life which are capable of monetary measurement, but the totality of human life is like the beauty of sunrise or the splendor of the stars, beyond the reach of monetary tape-measure. The determination of damages for loss of human life is an extremely difficult task and it becomes all the more baffling when the deceased is a child and/or a non-earning person. The future of a child is uncertain. Where the deceased was a child, he was earning nothing but had a prospect to earn. The question of assessment of compensation, therefore, becomes stiffer. The figure of compensation in such cases involves a good deal of guesswork. In cases, where parents are claimants, relevant factor would be age of parents.
10. In case of the death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child's life-time. But this will not necessarily bar the parent's claim and prospective loss will find a valid claim provided that the parents' establish that they had a reasonable expectation of pecuniary benefit if the child had lived. This principle was laid down by the House of Lords in the famous case of Taff Vale Rly. V. Jenkins (1913) AC 1, and Lord Atkinson said thus:
".....all that is necessary is that a reasonable expectation of pecuniary benefit should be entertained by the person who sues. It is quite true that the existence of this expectation is an inference of fact - there must be a basis of fact from which the inference can reasonably be drawn; but I wish to express my emphatic dissent from the proposition that it is necessary that two of the facts without which the inference cannot be drawn are, first that the deceased earned money in the past, and, second, that he or she contributed to the support of the plaintiff. These are, no doubt, pregnant pieces of evidence, but they are only pieces of evidence; and the necessary inference can I think, be drawn from circumstances other than and different from them." (See Lata Wadhwa and Ors. v. State of Bihar and Ors. (2001 (8) SCC 197)
11. This Court in Lata Wadhwa's case (supra) while computing compensation made distinction between deceased children falling within the age group of 5 to 10 years and age group of 10 to 15 years.
12. In cases of young children of tender age, in view of uncertainties abound, neither their income at the time of death nor the prospects of the future increase in their income nor chances of advancement of their career are capable of proper determination on estimated basis. The reason is that at such an early age, the uncertainties in regard to their academic pursuits, achievements in career and thereafter advancement in life are so many that nothing can be assumed with reasonable certainty. Therefore, neither the income of the deceased child is capable of assessment on estimated basis nor the financial loss suffered by the parents is capable of mathematical computation.
13. Applying the principles indicated in Jasbir Kaur's case (supra) to the facts of the present case we think award of a sum of Rs.1,80,000/- would meet the ends of justice. The same shall carry interest at the rate of 7.5% from the date of filing of petition till payment is made. Payment shall be made within a period of three months from today. Amounts, if any, already paid shall be adjusted from the aforesaid amount of Rs.1,80,000/-.??
The view express by Apex Court in case of Lata Wadhwa as referred above is quoted as under:
?SLoss of child to the parents is irrecoupable, and no amount of money could compensate the parents. Having regard to the environment from which these children were brought, their parents being reasonably well placed officials of Tata Iron and Steel Company, and on considering the submission of Mr. Nariman, we would direct that the compensation amount for the children between the age group of 5 to 10 years should be three times. In other words, it should be Rs. 1.5 Lakhs, to which the conventional figure of Rs. 50,000 should be added and thus the total amount in each case would be Rs. 2.00 lakhs. So far as the children between the age group of 10 to 15 years, they are all students of Class VI to Class X and are children of employees of TISCO. TISCO itself has a tradition that every employee can get one of his children employed in the Company.
Having regard to these facts, in their case, the contribution of Rs. 12000/- per annum appears to us to be on the lower side and in our considered opinion, the contribution should be Rs. 24000/- and instead of 11 multiplier, the appropriate multiplier would be 15. Therefore, the compensation, so calculated on the aforesaid basis should be worked out to Rs. 3.60 lakhs to which an addition sum of Rs. 50,000/- has to be added, thus making the total amount payable at Rs. 4.10 lakhs for each of the claimants of the aforesaid deceased children.??
The contention raised by learned advocate Mr. Shah is not helpful to his submissions. Therefore, can not be accepted and same is rejected.
The claims Tribunal has rightly relied upon two decision of Apex Court and assessed notional income and considered 2/3 dependency while awarding compensation in favour of claimants, for that, claims Tribunal has not committed any error which would require any interference by this Court.
Hence, there is no substance in the present appeal. Accordingly, present appeal is dismissed.
Today, first appeal is dismissed by this Court, therefore, no order is required to be passed in civil application. Accordingly, civil application is also disposed of.
(H.K.RATHOD, J) asma Top