Madras High Court
M/S.United India Insurance Co. Ltd vs R.Bhuvaneswari on 11 January, 2010
Author: P.P.S.Janarthana Raja
Bench: P.P.S.Janarthana Raja
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED 11.01.2010 CORAM THE HONOURABLE MR. JUSTICE. P.P.S.JANARTHANA RAJA C.M.A.No.3269 of 2010 and M.P.No.1 of 2010 M/s.United India Insurance Co. Ltd., No.178, 1st Floor, Dr.Nanjappa Road, Coimbatore-18. .. Appellant Vs 1.R.Bhuvaneswari, 2.Minor.Lathika, 3.Minor.Madhubala, 4.Minor.Rama, (RR2 to 4 are rep.by their mother and next friend R1) 5.Rukmani, 6.Rakesh, 7.R.Naren Rajan, 8.Chitrakala, (RR6 to 8 are ex-parte in Lower Court .. Respondents Appeal filed under Section 173 of the Motor Vehicles Act, 1988 against the award dated 26.02.2010 made in M.C.O.P.No.116 of 2006, by the Motor Accident Claims Tribunal, Chief Judicial Magistrate Court, Coimbatore. For appellant : Mr.M.B.Gopalan For respondents : Mr.K.Kalyanasundaram for RR1 to 5 RR6 to 8 Ex-parte J U D G M E N T
The appeal is preferred by the appellant-United India Insurance Company against the award dated 26.02.2010, made in M.C.O.P.No.116 of 2006, by the Motor Accident Claims Tribunal, Chief Judicial Magistrate Court, Coimbatore.
2. Background facts in a nutshell are as follows:
The deceased R.M.Rajendran met with motor vehicle accident that took place on 19.02.2006, at about 16.30 hours. The said deceased was riding a motorcycle bearing registration No.TN38 AC3325 on the extreme left side of the Avinashi road from east to west. When he was proceeding near Goldwins in front of Sri Murugan Auto Carriage, the Tata Sumo car bearing registration No.TN38 A1789 belonging to the 7th respondent, driven by its driver, the 6th respondent herein, in a rash and negligent manner, at high speed and hit against the motorcycle. Due to the same, the rider of the motorcycle sustained fatal injuries and died on the spot. The claimants are the wife, three minor children and mother of the deceased. They claimed a sum of Rs.19,00,000/- as compensation, before the Tribunal. The appellant-United India Insurance company resisted the claim. On pleadings the Tribunal framed the following issues:-
"1. Whether the first respondent is rash and negligent in driving the vehicle owned by the second respondent at the time of the accident and subsequently transferred to the fourth respondent pendentelite pending disposal of the petition insured with the third respondent in a rash and negligent manner and caused the death of one Rajendran?
2. Whether the petitioners are entitled to the compensation? If so, how much?"
After considering the oral and documentary evidence, the Tribunal held that the accident had occurred only due to rash and negligent driving of the 6th respondent herein, the driver of the Tata Sumo Car and awarded a compensation of Rs.11,78,500/- with interest at 7.5% per annum from the date of the claim petition and the details of the same are as under:-
Loss of earning Rs.11,52,000/- Damages to cloths and articles Rs. 500/- Transport expenses Rs. 1,000/- Loss of consortium Rs. 10,000/- Loss of love and affection Rs. 10,000/- Funeral expenses Rs. 5,000/- --------------------- Total... Rs.11,78,500/- --------------------
Aggrieved by that award, the appellant-United India Insurance company has filed the present appeal.
3.The learned counsel appearing for the appellant-United India Insurance Company questioned only quantum of compensation awarded by the Tribunal and contended that the amount awarded by the Tribunal is excessive, exorbitant, without basis and justification. Therefore, the award passed by the Tribunal is not in accordance with law and the same has to be set aside.
4. Learned counsel appearing for the respondents 1 to 5 submitted that the Tribunal had considered all the relevant materials and evidence on record and came to the right conclusion and awarded a just, fair and reasonable compensation. Hence the order of the Tribunal is in accordance with law and the same has to be confirmed.
5. Heard the counsel. On the side of the claimants the wife of the deceased was examined as PW.1 and one Devadoss, who is the eye witness of the accident, was examined as PW2 and Deivanai, who is the one of the partner in the medical shop, was examined as PW3 and documents Exs.P1 to P35 were marked. On the side of the respondents no one was examined and no document was marked to substantiate their claim. Ex.P1 is the certified copy of the First Information Report. Ex.P2 is the certified copy of the rough sketch. Ex.P3 is the certified copy of the Motor Vehicle Inspector's Report(TN38 A1789). Ex.P4 is the certified copy of the Motor Vehicle Inspector's Report(TN38 AC 3325). Ex.P5 is the certified copy of the Motor Vehicle Inspector's Report(TN37 Y7922). Ex.P6 is the certified copy of the Charge Sheet. Ex.P7 is the certified copy of Judgment in C.C.No.86 of 2006 of J.M.No.VIII, Coimbatore. Ex.P8 is the certified copy of the driving licence of the deceased Rajendran. Ex.P9 is the certified copy of the driving licence of the first respondent. Ex.P10 is the certified copy of the death certificate of deceased Rajendran. Ex.P11 is the certified copy of the Post-mortem certificate, Ex.P12 is the certified copy of the legalheir certificate, Ex.P13 is the certified copy of the Transfer Certificate of deceased Rajendran, Ex.P14 is the Partnership deed, Ex.P15 is the Form No.21-C, Ex.P16 to P20 are the Income Tax Returns for the assessment years from 2000 to 2007, Ex.P21 is the certified copy of the sale deed, Ex.P22 is the Patta, Ex.P23 is the Pasali, Ex.P24 is the 'A' Register Extract, Ex.P25 is the Patta Pass Book, Ex.P26 is the Receipt, Ex.P27 is the Agriculture income certificate, Ex.P28 to 30 are the School Certificates, Ex.P31 is the Salary certificate of deceased Rajendran, Ex.P32 is the certified copy of the Drug Licence Certificate, Ex.P33 is the Cash Book, Ex.P34 is the Ledger and Ex.P35 is the Ledger Book. After considering the above oral and documentary evidence, the Tribunal had given a categorical finding that the accident had occurred only due to the rash and negligent driving of the driver of the Tata Sumo Car and the finding is based on valid materials and evidence.
6. In the case of SARLA VERMA AND OTHERS VS. DELHI TRANSPORT CORPORATION AND ANOTHER reported in (2009) 4 MLJ 997, the Apex Court has considered the relevant factors to be taken into consideration before awarding compensation and held as follows:
"7. Before considering the questions arising for decision, it would be appropriate to recall the relevant principles relating to assessment of compensation in cases of death. Earlier, there used to be considerable variation and inconsistency in the decisions of Courts Tribunals on account of some adopting the Nance method enunciated in Nance V. British Columbia Electric Rly. Co. Ltd. (1951) AC 601 and some adopting the Davies method enunciated in Davies V. Powell Duffryn Associated Collieries ltd., (1942) AC 601. The difference between the two methods was considered and explained by this Court in General Manager, Kerala State Road Transport Corporation Vs. Susamma Thomas AIR 1994 SC 1631: (1994) 2 SCC 176. After exhaustive consideration, this Court preferred the Davies method to Nance method. We extract below the principles laid down in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas (supra).
"In fatal accident action, the measure of damage is the pecuniary loss suffered and is likely to be suffered by each dependent as a result of the death. The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have live or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether."
" The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependants, and to deduct therefrom such part of his income as the deceased was accustomed to spend upon himself, as regards both self-maintenance and pleasure, and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependants. Then that should be capitalised by multiplying it by a figure representing the proper number of years purchase."
"The multiplier method involves the ascertainment of the loss of dependency or the multiplicand having regard to the circumstances of the case and capitalizing the multiplicand by an appropriate multiplier. The choice of the multiplier is determined by the age of the deceased (or that of the claimants whichever is higher) and by the calculation as to what capital sum, if invested at a rate of interest appropriate to a stable economy, would yield the multiplicand by way of annual interest. In ascertaining this, regard should also be had to the fact that ultimately the capital sum should also be consumed-up over the period for which the dependency is expected to last."
"It is necessary to reiterate that the multiplier method is logically sound and legally well-established. There are some cases which have proceeded to determine the compensation on the basis of aggregating the entire future earnings for over the period the life expectancy was lost, deducted a percentage therefrom towards uncertainties of future life and award the resulting sum as compensation. This is clearly unscientific. For instance, if the deceased was, say 25 years of age at the time of death and the life expectancy is 70 years, this method would multiply the loss of dependency for 45 years virtually adopting a multiplier of 45 and even if one-third or one-fourth is deducted therefrom towards the uncertainties of future life and for immediate lump sum payment, the effective multiplier would be between 30 and 34. This is wholly impermissible."
In UP State Road Transport Corporation V. Trilok Chandra (1996) 4 SCC 362, this Court, while reiterating the preference to Davies method followed in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas (supra), stated thus:
"In the method adopted by Viscount Simon in the case of Nance also, first the annual dependency is worked out and then multiplied by the estimated useful life of the deceased. This is generally determined on the basis of longevity. But then, proper discounting on various factors having a bearing on the uncertainties of life, such as, premature death of the deceased or the dependent, remarriage, accelerated payment and increased earning by wise and prudent investments, etc., would become necessary. It was generally felt that discounting on various imponderables made assessment of compensation rather complicated and cumbersome and very often as a rough and ready measure, one-third to one-half of the dependency was reduced, depending on the life span taken. That is the reason why courts in India as well as England preferred the Davies formula as being simple and more realistic. However, as observed earlier and as pointed out in Susamma Thomas case, usually English courts rarely exceed 16 as the multiplier. Courts in India too followed the same pattern till recently when tribunals/courts began to use a hybrid method of using Nance method without making deduction for imponderables..... Under the formula Advocated by Lord Wright in Davies, the loss has to be ascertained by first determining the monthly income of the deceased, then deducting therefrom the amount spent on the deceased, and thus assessing the loss to the dependants of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an appropriate multiplier" (emphasis supplied)
7. In the case of SYED BASHEER AHAMED AND OTHERS VS. MOHAMMED JAMEEL AND ANOTHER reported in (2009) 2 Supreme Court Cases 225, the Apex Court has held as follows:
"13. Section 168 of the Act enjoins the Tribunal to make an award determining the amount of compensation which appears to be just. However, the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression which appears to be just vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of compensation.
14. Similarly, although the Act is a beneficial legislation, it can neither be allowed to be used as a source of profit, nor as a windfall to the persons affected nor should it be punitive to the person(s) liable to pay compensation. The determination of compensation must be based on certain data, establishing reasonable nexus between the loss incurred by the dependants of the deceased and the compensation to be awarded to them. In a nutshell, the amount of compensation determined to be payable to the claimant(s) has to be fair and reasonable by accepted legal standards.
15. In Kerala SRTC v. Susamma Thomas2, M.N. Venkatachaliah, J. (as His Lordship then was) had observed that: (SCC p.181, para 5) 5. The determination of the quantum must answer what contemporary society would deem to be a fair sum such as would allow the wrongdoer to hold up his head among his neighbours and say with their approval that he has done the fair thing. The amount awarded must not be niggardly since the law values life and limb in a free society in generous scales. At the same time, a misplaced sympathy, generosity and benevolence cannot be the guiding factor for determining the compensation. The object of providing compensation is to place the claimant(s), to the extent possible, in almost the same financial position, as they were in before the accident and not to make a fortune out of misfortune that has befallen them.
18. The question as to what factors should be kept in view for calculating pecuniary loss to a dependant came up for consideration before a three-Judge Bench of this Court in Gobald Motor Service Ltd. v. R.M.K. Veluswami4, with reference to a case under the Fatal Accidents Act, 1855, wherein, K. Subba Rao, J. (as His Lordship then was) speaking for the Bench observed thus: (AIR p.1) In calculating the pecuniary loss to the dependants many imponderables enter into the calculation. Therefore, the actual extent of the pecuniary loss to the dependants may depend upon data which cannot be ascertained accurately, but must necessarily be an estimate, or even partly a conjecture. Shortly stated, the general principle is that the pecuniary loss can be ascertained only by balancing on the one hand the loss to the claimants of the future pecuniary benefit and on the other any pecuniary advantage which from whatever source comes to them by reason of the death, that is, the balance of loss and gain to a dependant by the death must be ascertained.
19. Taking note of the afore extracted observations in Gobald Motor Service Ltd. in Susamma Thomas it was observed that: (Susamma Thomas case, SCC p.182, para 9) 9. The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables e.g.the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have lived or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether.
20. Thus, for arriving at a just compensation, it is necessary to ascertain the net income of the deceased available for the support of himself and his dependants at the time of his death and the amount, which he was accustomed to spend upon himself. This exercise has to be on the basis of the data, brought on record by the claimant, which again cannot be accurately ascertained and necessarily involves an element of estimate or it may partly be even a conjecture. The figure arrived at by deducting from the net income of the deceased such part of income as he was spending upon himself, provides a datum, to convert it into a lump sum, by capitalising it by an appropriate multiplier (when multiplier method is adopted). An appropriate multiplier is again determined by taking into consideration several imponderable factors. Since in the present case there is no dispute in regard to the multiplier, we deem it unnecessary to dilate on the issue."
After considering the principles enunciated in the judgments cited supra, let me consider the facts of the present case.
8.Ex.P13 is the Transfer Certificate of the deceased R.M.Rajendran, in which, the date of birth of the deceased was mentioned as 21.07.1962. The accident has taken place during 2006. Therefore, the Tribunal has fixed the age of the deceased. at the time of the accident was 44 years. In respect of income, it was claimed by the claimants that the deceased was earning a sum of Rs.13,000/- per month and he was running M/s.Arul Medicals shop, in which, he was a partner and also running another medical shop under the name and style of 'M/s.Sri Krishna Medicals'. It was stated that the deceased was receiving salary of Rs.6,000/- from the medicals and also getting bonus of Rs.6,000/- and further a sum of Rs.2,000/- from the agricultural land. The partnership deed of the business is also marked as Ex.P14, in which, it is stated that each partners are entitled to get remuneration of Rs.1,20,000/- per annum. Ex.P16 is the annual return of M/s.Arul medical, in which it is stated the annual salary of the deceased was Rs.41,029/-. Therefore, the Tribunal fixed the total income for the assessment year of 2000-2001 was Rs.45,701/- from another medical shop. In respect of M/s.Krishna Medicals, the same was managed by the deceased. The wife was also partner in the said shop. The said shop was assessed to Income Tax. The Tribunal, after considering the document, has fixed a sum of Rs.50,000/- as income from the said shop. Therefore, the Tribunal was of the view that the deceased would be getting Rs.50,000/- each from the medical shop. In these circumstances, the Tribunal is correct in fixing the monthly income at Rs.8000/- per month. Out of the said amount, the Tribunal has deducted 1/5th share towards personal expenses i.e. Rs.1,600/- on the ground that the family consisting of eight persons and taken the balance sum of Rs.6,400/- as the monthly contribution to his family and determined the annual contribution at Rs.76,800/- (Rs.6,400/- X 12). The Tribunal, taking into consideration the age of the deceased at 44 years, has adopted the multiplier of '15' and determined the loss of income at Rs.11,52,000/- (Rs.76,800 X 15). In the present case, the Tribunal is correct in fixing the age of the deceased, monthly income, as well as annual income and also correctly adopted the multiplier of '15' as per the schedule, considering the age of the deceased. Hence, the amount awarded under the head of income is very reasonable and the same is confirmed. The Tribunal awarded a sum of Rs.500/- under the head of damages to clothing and articles, Rs.1,000/- under the head of transport expenses, which are also very reasonable and therefore they are confirmed. Further, the Tribunal awarded a sum of Rs.10,000/- under the head of loss of consortium, Rs.10,000/- under the head of loss of love and affection and Rs.5,000/- under the head of funeral expenses, which also very reasonable and therefore they are confirmed. The Tribunal has fixed the rate of interest at 7.5% p.a from the date of petition. The accident occurred on 19.02.2006. Keeping in view the prevailing rate of interest during that period and the date of award, the interest awarded by the Tribunal is very reasonable and the same is confirmed. After taking into consideration the facts and circumstances of the case, this Court is of the view that there is no illegality or perversity in the order of the Tribunal warranting interference. It is a question of fact and it is not a perverse order. The finding is based on valid materials and evidence and hence the award passed by the Tribunal is in accordance with law and the same is confirmed. Accordingly the above appeal is dismissed. Consequently, connected miscellaneous petition is closed. No costs.
11.The appellant-Insurance Company is directed to deposit the entire compensation amount, less the amount already deposited, within a period of six weeks from the date of receipt of a copy of this order. It is also represented that the second claimant Lathika attained majority. Therefore, on such deposit, the claimants 1, 2 and 5/respondents 1, 2 and 5 are permitted to withdraw their respective shares on making proper application. In respect of other minors viz.,respondents 3 and 4 are concerned the Tribunal has directed to deposit their shares in a fixed deposit scheme in any one of the nationalised bank for a period of three years and renewable thereafter till they attain majority. The mother of the minors are permitted to withdraw accrued interest thereon once in three months from the bank by making proper application.
11.01.2011
Internet : Yes / No
Index : Yes / No
krk
P.P.S.JANARTHANA RAJA, J. krk
To
1.The Motor Accidents Claims Tribunal,
Chief Judicial Magistrate Court, Coimbatore.
2.The Section Officer,
VR Section, High Court, Madras.
C.M.A.No.3269 of 2010
11.01.2011