Gujarat High Court
New India Assurance Co. Ltd vs Arjunsinh Gulabsinh Patel & 6 on 5 September, 2017
Author: R.M.Chhaya
Bench: R.M.Chhaya
C/FA/790/2017 ORDER
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST APPEAL NO. 790 of 2017
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NEW INDIA ASSURANCE CO. LTD.....Appellant(s)
Versus
ARJUNSINH GULABSINH PATEL & 6....Defendant(s)
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Appearance:
MR VIBHUTI NANAVATI, ADVOCATE for the Appellant(s) No. 1
CHETANKUMAR K SHAH, ADVOCATE for the Defendant(s) No. 3 - 7
RULE SERVED for the Defendant(s) No. 2
UNSERVED-EXPIRED (R) for the Defendant(s) No. 1
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CORAM: HONOURABLE MR.JUSTICE R.M.CHHAYA
Date : 05/09/2017
ORAL ORDER
1. Feeling aggrieved by and dissatisfied with the judgment and award dated 30.09.2016 passed by learned Motor Accident Claims Tribunal (Main.), Dahod, in Motor Accident Claim Petition No.495 of 2008, the appellant - Insurance Company preferred present appeal under Section 173 read with Section 163A of the Motor Vehicles Act, 1988 (hereinafter referred to as "the Act" for short).
2. Heard Mr.Vibhuti Nanavati, learned counsel for the appellant - Insurance Company and Mr.Chetankumar Shah, learned counsel for respondent Nos.3 to 7 - original claimants. Though served, no one appears for respondent No.2. Respondent No.1 has been deleted by earlier order passed by this Court.
3. In light of the aforesaid fact and at the request of learned counsel for the parties, the appeal is taken up Page 1 of 7 HC-NIC Page 1 of 7 Created On Sun Sep 10 03:59:16 IST 2017 C/FA/790/2017 ORDER for its final disposal. Learned counsel for the parties have also provided copies of evidence adduced before learned Tribunal for perusal of this Court.
4. The following noteworthy facts, which emerge from the record of the appeal:-
4.1 That on 17.02.2008, at about 9:00 hours in the morning, when deceased Shardaben was walking on the road between village Motamal to Vanzariya, driver of Motorcycle bearing registration No.GJ-20-D-8009 came in excessive speed, in rash and negligent manner and dashed with Shardaben and because of which, Shardaben received serious injuries and was admitted to Government Hospital, Limkheda and then to Godhara Hospital and ultimately, she was required to be shifted to Civil Hospital, Ahmedabad where she succumbed to the injuries. Respondent Nos.3 to 7 -
original claimants preferred claim petition before learned Tribunal under Section 163A of MV Act and thereafter, it was amended by way of application at Exh:17 under Section 163A of the Act and claimed Rs.5,00,000/-, wherein learned Tribunal awarded a sum of Rs.4,36,500/-. Being aggrieved by the same, the appellant - Insurance Company has filed present appeal.
5. Learned counsel for the appellant has raised following contentions :-
(a) That the learned Tribunal has committed an obvious error in not following structured formula as provided under Section 163A of the MV Act and therefore, the impugned judgment and award is erroneous and deserves to be quashed and set aside by allowing present appeal.
(b) That in case of fatal accident in an application Page 2 of 7 HC-NIC Page 2 of 7 Created On Sun Sep 10 03:59:16 IST 2017 C/FA/790/2017 ORDER under Section 163A of the Act, structured formula has to be followed and no multiplier can be provided for.
(c) That when an application under Section 163A of MV Act considered in a fatal case, deduction has to be made as per the schedule i.e. 1/3rd and it cannot be 1/4th.
d) That, as per the structured formula, as the deceased was 35 years old, following the judgment of the Apex Court in the case of National Insurance Company Ltd. Vs. Smt. Gurumallamma & Anr. [2008 ACJ 1116 (SC)], the respondents claimants would be entitled to compensation of Rs.3,93,500/- only, whereas learned Tribunal has not followed the structured formula and has awarded the compensation on its own, which is beyond the scope and ambit of Section 163A of MV Act and hence, the appeal be allowed.
6. Learned counsel for respondent Nos.3 to 7 - original claimants has relied upon the judgment of the Bombay High Court in the case of Anita & Ors. Vs. ShriKrishna Construction Company & Ors. [2016 A.C. 866 (Bom.) (AB)] and has contended that only 1/3rd has to be deducted towards personal expenses and even in case of Section 163A of MV Act, fair compensation can be determined by notional considering income as calculated by learned Tribunal. It was therefore, submitted that there is no error in the impugned judgment and award and the appeal being meritless, deserves to be dismissed.
No other or further submissions are made by learned counsel for the parties.
7. Upon considering the impugned judgment and award, Page 3 of 7 HC-NIC Page 3 of 7 Created On Sun Sep 10 03:59:16 IST 2017 C/FA/790/2017 ORDER compensation has to be awarded as per the structured formula as indicated in the Second Schedule of Section 163 of the Act and it cannot be calculated in any manner. It further deserves to be noted that, the amount of compensation so arrived at in the case of fatal accident, the accident claims shall be reduced by 1/3rd towards personal expenses as provided in the note attached to the said schedule. The judgment of Bombay High Court in the case of Anita & Ors. (supra), which was relied upon by learned Tribunal respondent Nos.3 to 7 would not be applicable in the present case.
8. It would be appropriate to refer to the judgment of the National Insurance Company Ltd. (supra), wherein the Apex Court has observed thus:-
"7. Section 163A was inserted by Act No. 54 of 1994 as a special measure to ameliorate the difficulties of the family members of a deceased who died in use of a motor vehicle. It contains a non obstante clause. It makes the owner of a motor vehicle or the authorized insurer liable to pay in the case of death, the amount of compensation as indicated in the Second Schedule to his legal heirs. The Second Schedule provides for the amount of compensation for third party Fatal Accident/Injury Cases Claims. It provides for the age of the victim and also provides for the multiplier for arriving at the amount of compensation which became payable to the heirs and legal representatives of the deceased depending upon his annual income. The Second Schedule furthermore provides that in a case of fatal accident, the amount of claim shall be reduced by 1/3rd in consideration of the expenses which the victim would have incurred upon himself, had he been alive. It provides for the amount of minimum compensation of Rs. 50,000/-. It furthermore provides for payment of general damages as specified in Note 3 thereof.
8. Multiplier stricto sensu is not applicable in the case of fatal accident. The multiplier would be applicable only in case of disability in non-fatal accidents as would appear from the Note 5 appended to the Second Schedule. Thus, even if the application of multiplier is ignored in the present Page 4 of 7 HC-NIC Page 4 of 7 Created On Sun Sep 10 03:59:16 IST 2017 C/FA/790/2017 ORDER case and the income of the deceased is taken to be Rs. 3,300/- per month, the amount of compensation payable would be somewhat between 6,84,000/- to Rs. 7,60,000/-. As the Second Schedule provides for a structured formula , the question of determination of payment of compensation by application of judicial mind which is otherwise necessary for a proceeding arising out of a claim petition filed under Section 166 would not arise. The Tribunals in a proceeding under Section 163A of the Act is required to determine the amount of compensation as specified in the Second Schedule. It is not required to apply the multiplier except in a case of injuries and disabilities.
9. The Parliament in laying down the amount of compensation in the Second Schedule, as indicated hereinbefore, in its wisdom, provided for payment of some amount which should be treated to be the minimum. It took into consideration the fact that a person's potentiality to earn is highest when he is aged between 25 and 30 years and that is why in case of permanent disability multiplier of 18 has been specified. The very fact that even if the deceased had an income of Rs. 3,000/- per month, he being aged about 15 years would receive a sum of Rs. 60,000/- but if his income was Rs. 40,000/- per annum, his legal heirs and representatives would receive a sum of Rs. 8,00,000/-. In the case of any non-earning person, the notional income has been fixed at Rs. 15,000/- per annum.
10. The deceased was running a hotel. He was, therefore, having some income. No document, however, was produced in support of the statement of the claimant (the mother of the deceased) that his income was 3,300/- per month. On what basis such a claim was made has not been disclosed. No document was produced. The deceased was not an income tax payee. Income of Rs. 3,300/- might have been chosen so as not to cross the deadline of income of Rs. 40,000/- per annum.
11. Although both the Tribunal as also the High Court has accepted the same, in our opinion, the income of the deceased should be determined at Rs. 24,000/- per annum. Applying the said principle, the claimant would have been entitled to a compensation of Rs. 4,22,000/-. From that sum, one-third should be deducted.
12. In view of the aforementioned finding, we are of the opinion that it is not necessary for us to take into consideration, the decisions cited at the bar Page 5 of 7 HC-NIC Page 5 of 7 Created On Sun Sep 10 03:59:16 IST 2017 C/FA/790/2017 ORDER suggesting that in a case of death of an unmarried person and wherein the claimants are the parents of the deceased, the age of the deceased shall be irrelevant factor for applying the multiplier specified in the Second Schedule."
9. On perusal of the impugned judgment, it appears that the learned Tribunal has calculated the loss of dependency as if it is an application under Section 166 of MV Act and has also given multiplier of '17' and even the prospective income has been considered to the tune of 15 %. In opinion of this Court, it is an obvious error committed by learned Tribunal. When the application is filed under Section 163A of the Act, as per the said provisions, compensation has to be as per the structured formula only and as per the Second Schedule, the claimants would be entitled to compensation under the head of loss of dependency as under:-
Considering the income of Rs.3,000/- per month and 35 years age of the deceased as per the Second Schedule, the amount would be Rs.5,76,000/- - less 1/3rd deduction, loss of dependency comes to Rs.3,84,000/-.
Thus, respondent Nos.3 to 7 would be entitled to total compensation as under:
Amount Head
(Rs.)
Rs.3,84,000/- Loss of Dependency
Rs.2,000 Loss of Estate
Rs.2,500/- Funeral expenses
Rs.05,000/- Loss of Consortium
Rs.3,93,500/- Total
As Rs.4,36,500/- is already awarded by learned
Tribunal, the learned Tribunal shall refund Rs.43,000/-Page 6 of 7
HC-NIC Page 6 of 7 Created On Sun Sep 10 03:59:16 IST 2017 C/FA/790/2017 ORDER along with proportionate costs and interest at the rate 8% from the date of application till its realization to the appellant - Insurance Company forthwith.
For the foregoing, the appeal is partly allowed. Record and proceedings, if any, be transmitted back to the learned Tribunal forthwith. No order as to costs.
(R.M.CHHAYA, J.) Suchit Page 7 of 7 HC-NIC Page 7 of 7 Created On Sun Sep 10 03:59:16 IST 2017