Bombay High Court
The Oriental Insurance Co.Ltd. ... vs Ig 1) Smt.Maya Wd/O Govindrao Khatri on 17 July, 2013
Author: A. P. Bhangale
Bench: A. P. Bhangale
fa205.09.odt 1
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH, NAGPUR.
FIRST APPEAL NO.205 OF 2009
APPELLANT :- The Oriental Insurance Co.Ltd. Divisional
Office No.2, Indore (M.P.) Through The
Divisional Manager, The Oriental
Insurance Co. Ltd. D.O.No.2, Palm Road,
Civil Lines, Nagpur.
...VERSUS...
RESPONDENTS :- ig 1) Smt.Maya Wd/o Govindrao Khatri, Aged
about 52 Yrs., Occ: Household,
2) Ku.Varsha D/o Govindrao Khatri, aged
about 22 Yrs., Occ: Student.
Both R/o - Near Gurunanak Bakery,
Ambikar Nagar, Amravati.
3) Mr.Shaikh Mubarak Shaikh Gafur, Aged
about 38 yrs., Occ: Driver, R/o - At &
Post: Chaurha, Tah.: Mahu, Distt.Indore.
(MP)
4) Mr.Vinod S/o Bhagwandas Saini, Aged
about 49 yrs., occ: Business, C/o.: Saini
Road Lines, Plot No.55-E, Nanak Nagar,
Indore (MP)
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Shri A. B. Godbole, Advocate for appellant.
Mrs. R. Dewani, Advocate for Respondent Nos.1 and 2.
None for Respondent Nos.3 and 4.
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CORAM : A. P. BHANGALE, J.
DATED : 17.07.2013
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O R A L J U D G M E N T
The present appeal is directed against the judgment and
award dated 12/02/2007 passed by Motor Accident Claims
Tribunal, Amravati in M.A.C.P. No.130 of 2003 whereby learned
Tribunal was pleased to grant a sum of Rs.10,96,500 as
compensation inclusive of no fault liability and interest at the rate
of 7.5% per annum from the date of petition till realization
thereof. The respondents before the Tribunal i.e. owner/driver
and insurer were held liable to pay compensation to the claimants
jointly and severally.
2) The brief facts stated are as under -
One Sandeep Khatri, the son of claimant-respondent
No.1 and brother of claimant-respondent No.2, who was the
student of Final Year B.E. (Civil), studying in the College of
Engineering at Badnera, was riding on a scooter bearing
No.MH-33/B-278 as pillion rider along with his friend Pankaj
Kothe. When the scooter was near Ashish Restaurant, Gupta
Petrol Pump, offending motor vehicle i.e. Truck bearing
registration No.MP-09/KB-5982 came from opposite direction in a
rash and negligent manner, lost its balance, fell upon Sandeep and
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his friend Pankaj and crushed them, as a result of weight,
Sandeep died on the spot, due to multiple injuries on vital parts of
his body. The incident reported to Badnera Police Station vide
F.I.R. No.6 of 2003 on 07/01/2003. Badnera Police had
investigated the matter, drawn spot panchnama, referred dead
body for post mortem. It was found that deceased Sandeep was a
student of Final Year B.E. (Civil) studying in College of
Engineering, Badnera, Amravati and was working with a
Construction Company as part time job of drawing designs of the
buildings and was also executing construction works. It was
claimed that he was getting salary of Rs.12,000/- per month in the
year 2003 (below Exhibit-31). It is also claimed that Sandeep had
completed AUTOCAD-2000 course during July-September from
Graphic Computers, Amravati and also passed Computer
Programming Course in March, 1997. According to the claimants,
the offending truck was insured with the Orient Insurance
Company Limited covering the date of accident with validity of
period between 06/09/2002 to 05/09/2003.
3) The fact that the offending truck was insured with the
appellant as also the fact that the accident had resulted on
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account of the said truck are not disputed before the Court. The
main contention of the appellant is that compensation that has
been awarded by learned Tribunal is excessive, unjust and
unreasonable. The fact that the victim was aged about 21 years,
studying in Final Year B.E.(Civil) and earning in-training part time
salary of Rs.4,000/- Per month is not disputed by the appellant.
According to appellant, the learned Tribunal ought to have
considered the earning of Rs.4,000/- per month by victim while
he was allegedly serving with Architect, Nitin Kadam. Although,
there is no service record of victim Sandeep. Learned Advocate
for the appellant also contended that considering the age of
dependent mother Smt.Maya stated as 48 years at the time of
accident, ought to have been taken into consideration by learned
Tribunal so as to choose appropriate multiplier as also appropriate
multiplicand after deduction of about 50% from the true income
of the deceased Sandeep.
4) Admittedly, there are no cross-objections in this appeal
on behalf of the respondents-claimants. But it is contended at the
time of hearing that victim Sandeep was aged 21 years only and
was a student when the accident had occurred. By that time, he
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had undergone AUTOCAD-2000 course, Computer Programming
and was already having a part time job with Architect Nitin
Kadam from whom, deceased Sandeep was earning a sum of
Rs.4,000/-. According to learned Advocate for the respondent
Nos.1 and 2, the income as civil engineer with all his future
prospects ought to have been considered by learned Member to
award just and proper amount of compensation. Learned
Advocate for respondent Nos.1 and 2 submitted that the amount
awarded under the impugned judgment and award is in fact lower
considering the facts in the absence of any cross-objection.
Learned Advocate for respondent Nos.1 and 2 sought for the
dismissal of the appeal and supported the impugned judgment
and award.
5) Learned Advocate for the appellant in support of his
submission made a reference to Donat Louis Machado and
others v. L. Ravindra and others reported in 2000 (1) TAC 208
SC. In that case while judging quantum of compensation in
the case of journalist aged 31 years and earning about Rs.2,500/-
per month with dependent parents and sisters. The Tribunal had
awarded aggregate sum of Rs.52,800/- which was enhanced by
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High Court to Rs.1,27,000/- and the Apex Court considered that
deceased journalist had very lucrative career before him for a
number of years and, therefore, had he survived, he could have
earned Rs.7,500/- per month at the end of his career. After
deducting 50% of the amount from his assessed earning at
Rs.3,750/- per month multiplied by 15 as chosen multiplier,
worked out a total sum of Rs.6,75,000/-. But Apex Court took
conservative figure of Rs.6,00,000/- only and awarded 1/3rd of it
on the ground that deceased would have spent his 2/3rd of his
earning on his own family which he would have raised and would
have spent on himself. A sum of Rs.2,00,000/-was held as
appropriate compensation payable to the claimants.
6) A reference is also made to the ruling in Arvind Kumar
Mishra v. New India Assurance Co.Ltd.and another reported in
2010 ACJ 2867 whereby part of compensation was fixed in case
of victim, who suffered 70% of permanent disability, on the basis
of assessed future income of Rs.60,000/- per annum and loss of
earning capacity at Rs.42,000/- per annum. Thus, after choosing
multiplier of 18, the total sum of Rs.7,56,000/- plus Rs.1,50,000/-
towards medical expenses were awarded by enhancing the
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compensation to Rs.9,06,000/-. Learned Advocate for the
respondent Nos.1 and 2 submitted that principles, which are
considered in case of permanent disability, would not have
applicable in the present case, which was based on death of the
victim in motor vehicle accident.
7) Learned Advocate for the respondent Nos.1 and 2 made
a reference to the ruling in Sarla Verma (Smt.) and others v.
Delhi Transport Corporation and another reported in (2009) 6
SCC 121, which gave guidelines in the cases arising in claims for
fatal accidents. The Apex Court gave certain directions to the
Tribunals and Courts in respect of procedure and steps to be
followed to arrive at uniformity and consistency in judgments in
this regard. The Apex Court held that -
Basically only three facts are required to be established
by the claimants so as to assess compensation in the case of death
claims i.e. -
(a) age of the deceased;
(b) income of the deceased; and
(c) the number of dependents upon him/her.
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And to arrive at the loss of dependency, it has to be considered
that -
(i) additions/deductions to be made for arriving at the
income of the deceased;
(ii) the deduction to be made towards the personal
living expenses of the deceased; and
(iii) the multiplier to be applied with reference to the
age of the deceased. ig
If these determinants are standardized, there will be uniformity
and consistency in the decisions, which can also help insurance
companies to settle the accident claims without delay.
The Apex Court gave guidelines regarding steps to be
taken to arrive at the figure of just compensation.
Step 1 (Ascertaining the multiplicand)
The income of the deceased per annum should be
determined. Out of the said income a deduction should be made
in regard to the amount which the deceased would have spent on
himself by way of personal and living expenses. The balance,
which is considered to be the contribution to the dependent
family, constitutes the multiplicand.
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Step 2 (Ascertaining the multiplier)
Having regard to the age of the deceased and period of
active career, the appropriate multiplier should be selected. This
does not mean ascertaining the number of years he would have
lived or worked but for the accident. Having regard to several
imponderables in life and economic factors, a table of multipliers
with reference to the age has been identified by the Supreme
Court. The multiplier should be chosen from the said table with
reference to the age of the deceased.
Step 3 (Actual calculation)
The annual contribution to the family (multiplicand)
when multiplied by such multiplier gives the "loss of dependency"
to the family.
Thereafter, a conventional amount in the range of Rs.
5,000/- to Rs.10,000/- may be added as loss of estate. Where the
deceased is survived by his widow, another conventional amount
in the range of Rs.5,000/- to Rs.10,000/- should be added under
the head of loss of consortium. But no amount is to be awarded
under the head of pain, suffering or hardship caused to the legal
heirs of the deceased.
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The funeral expenses, cost of transportation of the body
(if incurred) and cost of any medical treatment of the deceased
before death (if incurred) should also be added.
8) It appears that the Apex Court had considered the
earlier judicial precedent. In case of bachelor deceased and
claimants are his parents, normally 50% is allowed to be deducted
as personal and living expenses, assuming that bachelor would
spend half of the amount earned by him as an earning member of
the family. The principles to determine liability and quantum of
compensation which were laid down by the Apex Court were
modeled in Schedule-II of the Motor Vehicles Act, 1988 read with
Section 163-A of the Act of 1988 to arrive at just and fair
compensation. In para - 20 of Sarla Verma's case (cited supra), it
was observed that -
"Generally the actual income of the deceased less
income tax should be the starting point for calculating the
compensation. The question is whether actual income at
the time of death should be taken as the income or whether
any addition should be made by taking note of future
prospects."
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9) The Apex Court also expressed its view considering the
imponderables, uncertainties and addition of 50% to the actual
salary of the deceased would be considered after deducting tax
there from. Thus, in cases where victim was bachelor and
claimants are parents, normally 50% amount is to be deducted as
personal and living expenses because it is assumed that bachelor
would spend more on himself. There is also possibility in
future that he would get married in a short time, in which event
the contribution to his parents and siblings is likely to be cut
drastically. Thus, considering the imponderables as also relevant
considerations, living expenses or personal expenses are to be
deducted from the income of the deceased, if any, if payable.
Thereafter, multiplier has to be selected bearing in mind the loss
of dependency, looking to the age of the deceased person as also
the age of the dependents. Thus, guided by Second Schedule read
with Section 163-A of the Act of 1988, the amount of
compensation can be arrived at multiplicand by appropriate
multiplier, just and reasonable compensation may be awarded and
not bonanza for the claimants. In short, in Sarla Verma's case
(supra), multiplier scale in the ruling of U.P. SRTC v. Trilok
Chandra, (1996) 4 SCC 362 as well as New India Assurance Co.Ltd.
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v. Charlie, (2005) 10 SCC 720 were also considered as acceptable
to be used for arriving at just and reasonable compensation and in
addition to the amounts such as funeral expenses, loss of estate,
loss of consortium as the case may be with reasonable
compensatory interest from the date of amount become payable
till the amounts are to be awarded.
10) A reference is also made to the ruling in Santosh Devi
v. National Insurance Company Ltd. and others, reported in
2012(3) Bom.C.R. 698 Supreme Court, wherein the Apex Court
observed that -
"Court can take judicial notice of the fact that to
meet the challenges of high cost, persons latter (self
employed) also periodically increase cost of their labour.
It can be assumed that even a self employed person's
income over a period of time will increase by amount
30%."
Thus, there is a guideline to calculate compensation.
11) Learned Advocate for respondent Nos.1 and 2 submitted
that as far as claimants ought to be put in the pre-accidental
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position by awarding just compensation and damages which
claimants have suffered on account of death of important family
member. Pecuniary damages cannot replace a human life or limb
lost. Therefore, in addition to the pecuniary losses, the law
recognizes that payment should also be made for non-pecuniary
losses on account of loss of happiness, pain, suffering and
expectancy of life, etc. It appears that appellant could make
reference to Sarla Verma's case (supra) for determination of
compensation in cases of involving motor accident as also
guidelines mentioned therein to determine just compensation.
The Apex Court desired that in cases of self employed person or
persons, who were employed on fix salary without provision for
annual increment, etc. relies on the cost of living. The fact of rise
in prices, additional prospects of increase in income as also
challenges posed by high cost of living, the persons falling in the
later category periodically increase in the cost of labour, increase
in prices of essential and cost of living with due regard the
education, occupation of the victim are all factors which may be
considered for assessment of compensation in motor accident
claims.
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12) It is true that claimants are not required to prove the
case as required to be done in a criminal trial as observed in
Kusum Lata and others v. Satbir and others, reported in 2011
(3) Mh.L.J. 722 to endeavour the Tribunal in such cases is to
award just, fair and reasonable compensation. To restore the
claimants to apposition on assumption that death had not
occurred in the family or accident had not caused injury to the
victim. Thus, claimants are required to establish their case upon
preponderance of probabilities and the evidence on record may be
considered accordingly.
13) In the present case, the victim was a student, studied in
Civil Engineering B.E. Final and had also completed Courses in
AUTOCAD-2000 and Computer Programming. The evidence was
led about his part time job, but it appears that the claimants had
not led evidence regarding prospects of future of the victim as
Civil Engineer, his possible pay, promotion, increment, etc.
Learned Advocate for the respondent Nos.1 and 2 wants to point
out pay scale available in Civil Engineering with the help of
print out form the website www.payscale.com to argue that salary
of Civil Engineer in the current year can be anywhere between
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Rs.1,76,778/- to Rs.9,51,320/-. This evidence was not before the
Tribunal and Tribunal had assessed compensation on the
hypothetical basis that victim would have earned Rs.20,000/- per
month with which appellant had not agreed. As according to the
appellant, without any evidence, such assertion was wrong to fix
just, fair and reasonable compensation in the present case. There
is no dispute that victims have to be brought to the pre-accidental
position by awarding reasonable and additional compensation.
Considering the future prospects of the victim, there are other
imponderable also entered into calculations such as premature
death of victim, marriage in the family after some years, another
income which may be available to the family, possibility of
claimants dying early than expected span of life, suffix it to say
that award of compensation must be assessed as just and
reasonable sum and not excessive. Compensation will have to be
considered in the light of evidence that may be read in respect of
other conventional benefit such as loss of love and affection, loss
of estate, funeral expenses, etc. to enable the Tribunal to award
total compensation on the basis of evidence since appellant has
only limited to his claim to justness and reasonableness of
compensation.
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14) In view of the above, I think, it is in the interest of
justice to set aside the award and direct the Tribunal to allow the
parties to lead evidence regarding quantum of compensation.
Hence, the following order is passed.
ORDER
Appeal is partly allowed.
The impugned judgment and award is set aside with direction to the parties to lead their respective evidence regarding quantum of compensation only.
The Tribunal to allow the parties to lead evidence as they may choose within a period of six weeks from the date of receipt of the R. & P. Parties to cooperate with the Tribunal for early hearing.
After recording evidence, Tribunal to decide quantum of compensation on the basis of evidence led by the parties and after considering the ponderables and imponderables, future prospects of increase in income, conventional heads etc. for awarding just, fair and reasonable compensation.
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Order accordingly.
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