Allahabad High Court
Surendra Singh And Another vs Vijay Singh And Another on 19 January, 2018
Author: Saumitra Dayal Singh
Bench: Saumitra Dayal Singh
HIGH COURT OF JUDICATURE AT ALLAHABAD A.F.R. Judgment Reserved on 22.12.2017 Judgment Delivered on 19.01.2018 Court No. 63 Case :- FIRST APPEAL FROM ORDER No. - 3484 of 2012 Appellant :- Surendra Singh And Another Respondent :- Vijay Singh And Another Counsel for Appellant :- Vidya Kant Shukla Counsel for Respondent :- Rahul Sahai with Case :- FIRST APPEAL FROM ORDER No. - 1199 of 2016 Appellant :- Mukthar Singh & Others Respondent :- The New India Assurance Co. Ltd. & Others Counsel for Appellant :- Vishal Agarwal,A.K. Gautam,Ajit Kumar Counsel for Respondent :- Pramod Kumar,Rajeev Ojha,Smt Archana Singh with Case :- FIRST APPEAL FROM ORDER No. - 1820 of 2002 Appellant :- Prabhu Narain Agarwal And Others Respondent :- Arwa Deen Gupta And Others Counsel for Appellant :- Arvind Srivastava Counsel for Respondent :- Ajay Singh,Ramesh Singh with Case :- FIRST APPEAL FROM ORDER No. - 4230 of 2017 Appellant :- Reliance General Insurance Co. Ltd. Respondent :- Ramjeet And Others Counsel for Appellant :- Rahul Sahai Counsel for Respondent :- Ali Akbar Ansari Hon'ble Saumitra Dayal Singh,J.
These four appeals involve common questions as to: correct multiplier to be applied to the multiplicand; claim for future prospects (in cases involving death of a bachelor employed on fixed salary etc.) to determine the just, proper, reasonable and fair amount of compensation to be paid to the parent claimants, upon death of a bachelor caused in an accident involving a motor vehicle. Three of the appeals have been filed by the claimants for enhancement of the compensation awarded by various Motor Accident Claims Tribunals while one appeal has been filed by the insurance company contending the compensation awarded is excessive.
While, the claimants who are appellants in three appeals and respondents in one appeal (hereinafter referred to as the claimant), contend the multiplier should have been applied with reference to the age of the deceased (a bachelor), the insurance companies who are the respondents in three appeals and appellant in one appeal (hereinafter referred to as insurer), contend, the deceased, in each appeal being a bachelor and the claimants being parents of the deceased, the multiplier should have been applied with reference to the age of the claimants and not the deceased. Also, while the claimants claim computation of loss of income by giving benefit of future prospects, the insurers resist that claim on the ground that the deceased were only earning fixed income and therefore the claimants were not entitled to benefit of future prospects. Also, according to the claimants the amount awarded towards non-pecuniary loss is too less while according to the insurers reasonable amount has been awarded.
Common facts, as found by the different Tribunals relevant to computation of the multiplier, that form the subject matter of submissions advanced on either side, are noted below in the chart :
F.A.F.O. No. (A) Age (Deceased) (B) Multiplier (Deceased's Age) (C) Age of Claimant (D) Multiplier (Claimants Age) (E) Annual Loss of Dependency (F) Compensation - I G= (C X F) Rs.
Compensation- II H= (E X F) Difference I= (G - H) 3484/2012 16 18 40-39 16 7,500/-
1,35,000 1,20,000 15,000 1199/2016 27 17 50-45 11 24,000/-
4,08,000 2,64,000 1,44,000 1820/2002 23 18 50-55 11 12,000/-
2,16,000 1,32,000 84,000 4230/2017 20 18 48-44 13 30,000/-
5,40,000 3,90,000 1,50,000 FAFO No. 3484 of 2012:
This appeal has been filed by the claimants for enhancement. The motor accident giving rise to this appeal occurred on 22.07.2010 wherein Kapil Singh aged about 16 years died. It has been held by the Tribunal that the deceased Kapil Singh was waiting for a passenger vehicle on a road side, when a truck bearing registration no. UP-78 BT- 3985, being driven in a rash and negligent manner knocked down the deceased causing serious injuries resulting in his death.
In respect of his earning, it was disclosed that the deceased was working as a labourer engaged to load and unload goods on trucks and that at the time of the accident, he was earning Rs. 4,000/- per month. The Tribunal assumed the annual income of the deceased at Rs. 15,000/- on notional basis. It made a deduction therefrom of Rs. 7,500/- towards personal expenses. Thereafter, considering the age of the claimant it applied a multiplier of 16 and awarded Rs. 1,20,000/- by way of compensation towards loss of dependency. It also awarded Rs. 2,000/- towards funeral expenses. Thus, the Tribunal made an award of total compensation of Rs. 1,22,000/-.
Heard Sri V.K.Shukla, learned counsel for the claimants and Sri Rahul Sahai with Sri Anant Parihar, learned counsel for the insurer.
The appellants contend that they are entitled to higher compensation by application of a higher multiplier with reference to the age of the deceased and that the notional income of the deceased should have been taken at Rs. 36,000/- per annum. Further allowance should have been made for future prospects and reasonable amounts should have been awarded for future prospects and non-pecuniary losses and a higher interest of 9 to 10% should be awarded as against interest @ 6% awarded by the Tribunal.
The aforesaid appeal has been opposed by the insurer, contending that the notional income had been correctly taken by the Tribunal at Rs. 15,000/- per annum and in any case, the multiplier had been correctly applied with reference to the age of the claimants. There is no cross appeal or cross objection of the insurer.
FAFO Defective No. 1199 of 2016:
This appeal has been filed by the claimants for enhancement. The accident giving rise to the present appeal occurred on 29.11.2003 wherein Rakesh Kumar aged about 27 years died. At the time of the accident, Rakesh Kumar was driving a Tata Scorpio vehicle, bearing registration no. HR 49 - 9610. As, the said vehicle broke down, the deceased parked it on his left side of the road when a truck bearing registration no. HR 38F - 8242, being driven in a rash and negligent manner, travelling in the opposite direction, collided with the aforesaid Tata Scorpio vehicle. It resulted in injuries to the deceased to which he succumbed.
As to the income of the deceased it was stated that the deceased was working at a private commercial establishment named Chowdhary Beej Bhandar, at a fixed salary of Rs. 3,000/- per month. The Tribunal deducted 1/3rd of the same towards personal expenses and assumed the contribution made by the deceased to the claimants at Rs. 2,000/- per month or Rs. 24,000/- per annum. Applying a multiplier of 11 with reference to the age of the claimants being 50 and 45 years, it computed total compensation at Rs. 2,64,000/-. Also, the Tribunal awarded Rs. 2,500/- towards loss of estate and Rs. 2,000/- towards funeral expenses. Thus it awarded Rs. 2,68,500/-.
Heard Sri Rajeev Ojha, learned counsel for the claimant and Smt. Archana Singh, learned counsel for the insurer.
The appellant claims application of higher multiplier with reference to the age of the deceased. Also, he submits, provision for future prospects should have been made and also reasonable amounts should have been awarded towards non-pecuniary losses.
Learned counsel for the insurer contends that the multiplier has been correctly applied with reference to the age of the claimants.
FAFO No. 1820 of 2002:
This appeal has been filed by the claimants for enhancement. The accident giving rise to the present appeal occurred on 8.9.1997 wherein Pankaj Agarwal aged about 23 years died.
The claimant disclosed the deceased was working on the post of manager in an establishment known as Harihar Fertilizer owned by one Raman Agarwal at a fixed income of Rs. 5,000/- per month. This contention made by the claimant was denied by the insurer in the written statement. During evidence, the claimants did not file any documentary evidence. However, the claim witness-mother of the deceased stated, the deceased was earning Rs. 5,000/- per month of which he used to send her Rs. 3,000/- to Rs. 3,500/- per month.
The Tribunal took the income of the deceased at Rs.5,000/-. However, it made a deduction of Rs. 4,000/- therefrom towards personal expenses of the deceased. It thus determined the annual loss of dependency at Rs.12,000/- (1000 X 12). To this the Tribunal applied a multiplier of 11(with reference to the age of the claimants) and computed the compensation amount at Rs. 1,20,000/- (though even according to the multiplier applied by the Tribunal that amount should have been Rs. 1,32,000/-). The Tribunal further awarded Rs. 10,000/- towards loss of love and affection and Rs. 5,000/- towards funeral expenses. Thus, the Tribunal made an award of total compensation of Rs. 1,35,000/- (Rs. 1,20,000 + 10,000 + 5,000).
Heard Sri Arvind Srivastava, learned counsel for the claimants and Sri Ajay Singh, learned counsel for the insurer.
Learned counsel for the claimant has raised three submissions. In the first place he submits no provision has been made for future prospects. According to him, the Tribunal has accepted that the deceased was working on the post of manager and earning fixed salary Rs. 5,000/- per month at Harihar Fertilizer. Admittedly, he was only 23 years of age on the date of accident. Therefore, a provision should have been made for future prospects at the rate of 50%. In this regard, he relied on the judgment of the Supreme Court in the case of Sandhya Rani Debbarma Vs. National Insurance Ltd. reported in (2016) 16 SCC 206. Reliance was also placed on two other judgments of the Supreme Court both by three Hon'ble Judges being in the case of Munna Lal Jain Vs. Vipin Kumar Sharma and others 2015 (6) SCC 347 and Rajesh and others Vs. Rajbir and others 2013 (9) SCC 54.
He therefore, submits, even in case of a self-employed person the Supreme Court had made provision for award of future prospects while making computation of compensation. Also, reliance has been placed in the judgment of the Supreme Court in the case of Reshma Kumari and others Vs. Madan Mohan and another 2013(9) SCC 65.
Alternatively, it has been submitted by learned counsel for the appellant, the deceased was 23 years of age, and it has been found by the Tribunal that he was working as a manager in a private establishment. Keeping in mind operation of inflationary forces, the claimants were entitled to a natural and normal increase of compensation on that count.
Opposing the submission so made, learned counsel for the insurer submits, though it may not be denied that the deceased was 23 years of age on the date of his death and it is possible that he may have experienced increase of earning as the years would have gone by, had he lived a normal life, however, it also cannot be lost sight that the deceased was 23 years of age and a bachelor. The loss of dependency would not have continued at the same rate as a proportion of the monthly salary of the deceased if he had not suffered the accidental death. He would have, in due course of time been married and started his family. Thus, the accretion to his salary, if any, that would have occurred on account of future prospects would not have translated to or resulted in proportionate enhancement of the amount of dependency. Therefore, it has been submitted that loss of dependency as estimated by the Tribunal is fair and proper.
Second, it has been submitted by learned counsel for the claimant that deduction of personal expenses at 4/5 of the income as has been made by the Tribunal is excessive. At the outset, learned counsel for the appellant has referred to the judgment in the case of Smt. Sarla Verma and Ors. Vs. Delhi Transport Corporation and Another reported in (2009) 6 SCC 121 to submit such deduction could not have exceeded 50% of the income. He would submit, while the judgment in the case of Sarla Verma (supra) laid down the general principle in respect of deduction on account of personal expenses, it does not lay down a hard and fast rule in that regard. In the present facts, looking into the relationship of the deceased with his parents, he submits it stood established that the deceased was sending about Rs. 3,000/- to 3,500/- per month to his parents. In a case such as this where specific evidence had not been rebutted or disputed by the insurer, deduction of 4/5 of income towards personal expenses as made by the Tribunal contrary to the evidence led, is grossly erroneous.
Opposing the appeals, learned counsel for the insurer submits that in fact there was no evidence in this case to establish that the deceased was sustaining the claimants to the extent claimed. Neither any bank statement nor any other documentary evidence exists in support of the claim made. Therefore the estimation made by the Tribunal is wholly just and proper.
Third it has been submitted by learned counsel for the claimants that the Tribunal has erred in applying the multiplier with reference to the age of the claimants while it should have been applied with reference to the age of the deceased.
Learned counsel for the insurer has on the other hand relied on the principle that the correct multiplier to be applied in such cases would be with reference to the age of the claimants.
FAFO No. 4230 of 2017:
This appeal has been filed by the insurer. The accident giving rise to the present appeal occurred on 17.09.2010 wherein Dharmendra aged about 20 years died. The Tribunal applied a multiplier of 13 with reference to the age of the claimants to the loss of dependency taken at Rs. 30,000/- per annum. It thus awarded Rs. 3,90,000/- towards loss of dependency; Rs. 2,000/- towards funeral expenses and Rs. 2,500/- towards loss of estate. Thus, the Tribunal made an award of total compensation Rs. 3,94,500/-.
Sri Rahul Sahai, Advocate and Sri Anant Parihar, learned counsel for the insurer submit, while the income of the deceased had been estimated by the Tribunal at Rs. 45,000/- per annum, the Tribunal has erred in making deduction towards personal expenses at 1/3 rate only where as it should have been made at 1/2 rate in absence of any evidence.
On the other hand Sri Ali Akbar Ansari, learned counsel for the claimants submitted that the amount of compensation awarded by the Tribunal is not excessive. The total compensation awarded Rs. 3,94,500/- is almost just, proper, fair and reasonable. He therefore, submits, in the first place no further deduction was warranted towards personal expenses. Second, he submits, even if any, correction is to be made on that count then a higher multiplier should be applied with reference to the age of the deceased. It would lead to award of compensation Rs. 4,05,000/-. He, therefore, submits, if the correct multiplier is to be applied with reference to the age of the deceased, the claimants would be entitled to a higher compensation even if the ground of appeal raised by the insurer is allowed.
Responding to the above, learned counsel for the insurer submits, no cross-appeal or cross-objection has been filed by the claimant. Therefore they cannot claim higher compensation in the present appeal.
In view of the fact, the issue of multiplier and future prospects as has been raised in other appeals is being decided by this order that is common to other appeals as well, the outcome of the present appeal may also depend on the answer to the aforesaid questions involved in the other three appeals. The objection raised by learned counsel for the insurer as to lack of cross appeal/cross objection will be specifically dealt with later.
On the issue of application of correct multiplier, learned counsel for the claimants have submitted, the aforesaid issue has not arisen for the first time before this Court. They rely on five division bench judgments of this Court in each of which the exact issue raised in the present appeal had been considered. Each of those division bench have followed the law laid down by the Supreme Court in the case of Sarla Verma (supra) and applied the multiplier considering the age of the deceased bachelor. Thus reliance has been placed on the judgements of this Court in the cases of New India Assurance Co. Ltd. Vs. Gulab Singh and Others reported in 2015 (3) TAC 293 (All.); Saroj Devi and Others Vs. Royal Sundaram Alliance Insurance Co. Ltd. and Another reported in 2016 (2) TAC 281 (All.); National Insurance Co. Ltd. Vs. Vinesh and Others reported in 2016 (116) ALR 396; Vinod Shankar Shukla and Another Vs. Bhoruka Logistics Pvt. Ltd. and Another reported in 2016 (4) TAC 539 (All.) and lastly; Regional Manager, National Insurance Co. Ltd. Vs. Smt. Kusum Devi and Others reported in 2017 (1) CRC 599.
Learned counsel for the insurer respondents on the other hand urged that the correct principle to be applied in the present case would be to follow that laid down by the Supreme Court in the cases of Sri G.M. Kerala State Road Transport Corporation Vs. Sussama Thomas reported in AIR 1994 SC 1631, UPSRTC Vs. Trilok Chand reported in JT 1996(5) SC 356 and New India Assurance Co. Ltd. Vs. Smt. Shanti Pathak and Others reported in (2007) 10 SCC 1. He also relied on the judgment of the Supreme Court in the case of UPSRTC VS. Trilok Chand reported in JT 1996 (5) SC 356.
Sri Anant Parihar holding brief of Rahul Sahai who has led the argument on behalf of the insurer in FAFO No. 4230 of 2017 further submitted that the judgments of the five division benches of this Court relied upon by the claimants do not lay down the correct law.
Upon such submissions advanced by learned counsel for the parties, judgment had been reserved in the aforesaid appeals, on 21.09.2017. At that stage, it did appear that the issue involved in the present appeals especially with respect to application of the correct multiplier and also with respect to claim of compensation on account of future prospects was a vexed question, at least to some extent, in view of the certain decisions of the Supreme Court of co-equal bench strength that were relied upon by either party and which, as per the submissions made by learned counsel for the parties were in mutual conflict.
In the meanwhile the judgment of a constitution bench of the Supreme Court, in the case of National Insurance Company Ltd. Vs. Pranay Sethi and Others reported in (2017) ACJ 2700 has been pronounced. For that reason the matter was then placed for further hearing on 22.12.2017. Upon further hearing then held on 22.12.2017, the present set of appeals is being decided.
The constitution bench of the Supreme Court in the case of National Insurance Company Ltd. Vs. Pranay Sethi and Others (supra) has vide judgment dated 31.10.2017, dealt with, the issue of (i) correct multiplier to be applied; (ii) future prospects to be awarded in case of death of self employed person or person having fixed income and; (iii) award of compensation for non-pecuniary losses.
With respect to a multiplier, the Supreme Court has held as below:-
"44. As far as the multiplier is concerned, the claims tribunal and the Courts shall be guided by Step 2 that finds place in paragraph 19 of Sarla Verma read with paragraph 42 of the said judgment. For the sake of completeness, paragraph 42 is extracted below :-
"42. We therefore hold that the multiplier to be used should be as mentioned in Column (4) of the table above (prepared by applying Susamma Thomas, Trilok Chandra and Charlie), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years."
45. In Reshma Kumari, the aforesaid has been approved by stating, thus:-
"It is high time that we move to a standard method of selection of multiplier, income for future prospects and deduction for personal and living expenses. The courts in some of the overseas jurisdictions have made this advance. It is for these reasons, we think we must approve the Table in Sarla Verma for the selection of multiplier in claim applications made under Section 166 in the cases of death. We do accordingly. If for the selection of multiplier, Column (4) of the Table in Sarla Verma is followed, there is no likelihood of the claimants who have chosen to apply under Section 166 being awarded lesser amount on proof of negligence on the part of the driver of the motor vehicle than those who prefer to apply under Section 163-A. As regards the cases where the age of the victim happens to be up to 15 years, we are of the considered opinion that in such cases irrespective of Section 163-A or Section 166 under which the claim for compensation has been made, multiplier of 15 and the assessment as indicated in the Second Schedule subject to correction as pointed out in Column (6) of the Table in Sarla Verma should be followed. This is to ensure that the claimants in such cases are not awarded lesser amount when the application is made under Section 166 of the 1988 Act. In all other cases of death where the application has been made under Section 166, the multiplier as indicated in Column (4) of the Table in Sarla Verma should be followed."
46. At this stage, we must immediately say that insofar as the aforesaid multiplicand/multiplier is concerned, it has to be accepted on the basis of income established by the legal representatives of the deceased. Future prospects are to be 36 added to the sum on the percentage basis and "income" means actual income less than the tax paid. The multiplier has already been fixed in Sarla Verma which has been approved in Reshma Kumari with which we concur.
47. In our considered opinion, if the same is followed, it shall subserve the cause of justice and the unnecessary contest before the tribunals and the courts would be avoided."
(emphasis supplied) The Supreme Court has thus not only referred and relied upon the table of multiplier laid out in the case of Sarla Varma's (supra) case but that it has further observed that the same was approved in Reshma Kumari (supra) with which the constitution bench of Supreme Court has expressed its specific concurrence. Reason for the concurrence has also been stated in the aforesaid judgement being to sub-serve the cause of justice and unnecessary contest before the Tribunal and the Courts by standardizing the quantification of compensation to be awarded.
In this regard, it is further noted, both in the case of Sarla Verma (supra) and Reshma Kumari (supra) as also in the case of Pranay Sethi (supra) the Supreme Court has provided for applicable multiplier of 18 in case of age of deceased being between 15-20 years. Thus the highest multiplier had been consciously provided in cases involving death of a person who is most likely to be a bachelor for reason of his/her young age. In all such cases, therefore, the claimants would most likely and commonly be their parents only. Therefore, to argue that a lower multiplier should be applied in such cases would be to reason against the underlying foundation/premise of those judgments and if accepted would also dilute the clear dictum of those judgments.
Thereafter, the issue of non-pecuniary losses has also been authoritatively decided. Here again the Supreme Court has laid down a standardised formula to award that compensation amount/s at Rs. 15,000/- for loss of estate, Rs. 40,000/- for loss of consortium and Rs. 15,000/- for funeral expenses which amount have been further held to be enhanced every three years at a fixed rate of 10%.
These standardised amounts would be applicable in the State of U.P. to cases (such as those involved in the present set of appeals), to which Section 220A of the U.P. Motor Vehicles Rules, 1998 may not be applicable, that Rule having been introduced by an amendment w.e.f. 26.9.2011. Cases involving accident that may have occurred on or after 26.9.2011 would continue to be governed by Rule 220A of the aforesaid Rules. The directions of the Supreme Court in the case of National Insurance Company Ltd. Vs. Pranay Sethi and Others (supra) in so far as those directions pertain to award of non-pecuniary losses would apply to cases that are not covered under Rule 220A of the Rules, only. Those directions offer standardised rule and formula to award compensation for non-pecuniary losses where no rule or formula exists.
Then, dealing with the issue of 'future prospects', the Supreme Court has held as below:
"58. The seminal issue is the fixation of future prospects in cases of deceased who is self-employed or on a fixed salary. Sarla Verma (supra) has carved out an exception permitting the claimants to bring materials on record to get the benefit of addition of future prospects. It has not, per se, allowed any future prospects in respect of the said category.
59. Having bestowed our anxious consideration, we are disposed to think when we accept the principle of standardization, there is really no rationale not to apply the said principle to the self-employed or a person who is on a fixed salary. To follow the doctrine of actual income at the time of death and not to add any amount with regard to future prospects to the income for the purpose of determination of multiplicand would be unjust. The determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as postulated under Section 168 of the Act. In case of a deceased who had held a permanent job with inbuilt grant of annual increment, there is an acceptable certainty. But to state that the legal representatives of a deceased who was on a fixed salary would not be entitled to the benefit of future prospects for the purpose of computation of compensation would be inapposite. It is because the criterion of distinction between the two in that event would be certainty on the one hand and staticness on the other. One may perceive that the comparative measure is certainty on the one hand and uncertainty on the other but such a perception is fallacious. It is because the price rise does affect a self-employed person; and that apart there is always an incessant effort to enhance one's income for sustenance. The purchasing capacity of a salaried person on permanent job when increases because of grant of increments and pay revision or for some other change in service conditions, there is always a competing attitude in the private sector to enhance the salary to get better efficiency from the employees. Similarly, a person who is self-employed is bound to garner his resources and raise his charges/fees so that he can live with same facilities. To have the perception that he is likely to remain static and his income to remain stagnant is contrary to the fundamental concept of human attitude which always intends to live with dynamism and move and change with the time. Though it may seem appropriate that there cannot be certainty in addition of future prospects to the existing income unlike in the case of a person having a permanent job, yet the said perception does not really deserve acceptance. We are inclined to think that there can be some degree of difference as regards the percentage that is meant for or applied to in respect of the legal representatives who claim on behalf of the deceased who had a permanent job than a person who is self-employed or on a fixed salary. But not to apply the principle of standardization on the foundation of perceived lack of certainty would tantamount to remaining oblivious to the marrows of ground reality. And, therefore, degree-test is imperative. Unless the degree-test is applied and left to the parties to adduce evidence to establish, it would be unfair and inequitable. The degree-test has to have the inbuilt concept of percentage. Taking into consideration the cumulative factors, namely, passage of time, the changing society, escalation of price, the change in price index, the human attitude to follow a particular pattern of life, etc., an addition of 40% of the established income of the deceased towards future prospects and where the deceased was below 40 years an addition of 25% where the deceased was between the age of 40 to 50 years would be reasonable.
60. The controversy does not end here. The question still remains whether there should be no addition where the age of the deceased is more than 50 years. Sarla Verma thinks it appropriate not to add any amount and the same has been approved in Reshma Kumari. Judicial notice can be taken of the fact that salary does not remain the same. When a person is in a permanent job, there is always an enhancement due to one reason or the other. To lay down as a thumb rule that there will be no addition after 50 years will be an unacceptable concept. We are disposed to think, there should be an addition of 15% if the deceased is between the age of 50 to 60 years and there should be no addition thereafter. Similarly, in case of selfemployed or person on fixed salary, the addition should be 10% between the age of 50 to 60 years. The aforesaid yardstick has been fixed so that there can be consistency in the approach by the tribunals and the courts.
(emphasis supplied)"
Thus, again the Supreme Court has opined in favour of the standardization by making the principle applicable to cases involving fixed income or cases of self employed deceased. The Supreme Court found no rational to not apply that principle to self employed persons or persons with fixed salary. Further, it was held, to deprive (the claimants of such persons) compensation by not taking into account future prospects would be 'unjust'. At the same time, the Supreme Court has recognized that there must be found existing some degree of difference as regards the percentage that is meant for or to be applied to in respect of claimants of a person who had a permanent job and those of a person who may have been self employed or may have been working on a fixed salary.
Applying the degree test, the Supreme Court has first held that even in the cases of death of a person in a motor accident who was either self-employed or was working on a fixed salary, an addition (to loss of income) has to be made towards future prospects. Second, it has been held that compensation on account of future prospects in such case may be computed at the rate of 40% of the established income in case of the age of the deceased being below 40 years; at the rate of 25% of the established income in the case of the age of the deceased between 40 to 50 years and at the rate of 10% in case of age of the deceased being between 50 to 60 years.
The term established income has also been clarified to mean the income minus the tax component. Question and occasion to examine tax payability arises only if there is a real income. Therefore, clearly, claim for future prospects would arise only in cases where the claimants are successful in establishing any amount of definite income earned by the deceased. As a corollary to that, future prospects may not be awarded in cases of notional income as such income can never be categorised as established income, it having never been actually and factually earned and it being not real.
Having thus dealt with the aforesaid issues, the Supreme Court then summarized its conclusion in the penultimate paragraph of the judgment that is quoted below:-
"61. In view of the aforesaid analysis, we proceed to record our conclusions:-
(i) The two-Judge Bench in Santosh Devi should have been well advised to refer the matter to a larger Bench as it was taking a different view than what has been stated in Sarla Verma, a judgment by a coordinate Bench. It is because a coordinate Bench of the same strength cannot take a contrary view than what has been held by another coordinate Bench.
(ii) As Rajesh has not taken note of the decision in Reshma Kumari, which was delivered at earlier point of time, the decision in Rajesh is not a binding precedent.
(iii) While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax.
(iv) In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component.
(v) For determination of the multiplicand, the deduction for personal and living expenses, the tribunals and the courts shall be guided by paragraphs 30 to 32 of Sarla Verma which we have reproduced herein before.
(vi) The selection of multiplier shall be as indicated in the Table in Sarla Verma read with paragraph 42 of that judgment.
(vii) The age of the deceased should be the basis for applying the multiplier.
(viii) Reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs. 15,000/-, Rs. 40,000/- and Rs. 15,000/- respectively. The aforesaid amounts should be enhanced at the rate of 10% in every three years."
The entire judgment of the Supreme Court in the case of National Insurance Company Limited Vs. Pranay Sethi and Ors (supra) thus reaffirmed and authoritatively emphasised the need to standardize the method of computation of compensation to be awarded in cases of death caused in a motor accident. Thus, whether while dealing with the issue of future prospects in case of deceased who may have been a salaried employed or while considering the claim of future prospects in case of deceased who may have been self-employed or working on fixed salary or while considering the issue of applicability of the multiplier or while considering grant of non-pecuniary losses such as loss of estate, loss of consortium and funeral expenses, the Supreme Court has not only laid down the guiding principle but also the governing formula to be applied to compute the amount of compensation to be awarded.
It is apparent from that judgment that the rational behind the emphasis to standardize the mode of determining the award of compensation is the imperative need to reduce the agony of the hapless claimants who currently stand exposed to the risk of suffering for years while the Tribunal and the Courts across the country, being bound to be fair and follow rules of procedure, need time to deliberate and to balance the scales of justice before awarding the compensation amount. This agony would stand greatly reduced once the guiding principles and the governing formula laid down by the Supreme Court in the case of National Insurance Company Limited Vs. Pranay Sethi and Ors (supra) are given full effect, in all cases.
The other principle that has been reaffirmed and re-emphasized in the aforesaid judgment of the Supreme Court is to award 'just compensation'. Though that principle has been discussed in the context of award of compensation including the component of future prospects, the said principle as consistently applied to cases such as these does offer its application in the present set of facts as well.
Then, as noted above, five division bench judgments of our Court have dealt with this issue and consistently held that the multiplier to be applied in such cases would have to be the multiplier with reference to the age of the deceased and not the claimant.
Reliance placed by the learned counsel for the insurers on the judgments of the Calcutta and Delhi High Court, do not commend to me for the reason that the issue, as discussed above appears to have been authoritatively answered by the Supreme Court in the case of National Insurance Company Limited Vs. Pranay Sethi and Ors (supra) and it may be fruitless on part of this Court to consider the issue any further. Then, in any case it is settled principle of law that I am bound by the division bench judgments of this Court which are all consistent, categorical and now, also found to be in conformity with the decision of the aforesaid judgment of the Supreme Court.
Last, in view of the peculiar facts noted above being the total amount of disputed compensation awarded in all these appeals being not excessive, even if the principle being invoked by the learned counsel for the insurer were to be considered to any extent, necessarily then, an exception would have been immediately carved out to protect the quantum of compensation awarded in these cases by applying the multiplier with reference to the age of the deceased and not the claimant failing which the total compensation so awarded would itself become unjust and insufficient.
Thus, the compensation awarded in these cases has to be computed by invoking the multiplier commensurate to the age of the deceased as specified in the table drawn by the Supreme Court in the case of Smt. Sarla Verma (supra). In this regard the Supreme Court held as below:
"39. In New India Assurance Co. Ltd. Vs. Charlie [2005 (10) SCC 720], this Court noticed that in respect of claims under section 166 of the MV Act, the highest multiplier applicable was 18 and that the said multiplier should be applied to the age group of 21 to 25 years (commencement of normal productive years) and the lowest multiplier would be in respect of persons in the age group of 60 to 70 years (normal retiring age). This was reiterated in TN State Road Transport Corporation Ltd. vs. Rajapriya [2005 (6) SCC 236] and UP State Road Transport Corporation vs. Krishna Bala [2006 (6) SCC 249].
40.The multipliers indicated in Susamma Thomas, Trilok Chandra and Charlie (for claims under section 166 of MV Act) is given below in juxtaposition with the multiplier mentioned in the Second Schedule for claims under section 163A of MV Act (with appropriate deceleration after 50 years) :
Age of the deceased Multiplier scale as envisaged in Susamma Thomas Multiplier scale as adopted by Trilok Chandra Multiplier scale in Trilok Chandra as clarified in Charlie Multiplier specified in second column in the Table in II Schedule to MV Act Multiplier actually used in Second Schedule to MV Act (as seen from the quantum of compensation) (1) (2) (3) (4) (5) (6) Upto 15 yrs.
-
-
-15 20
15 to 20 yrs.16 18 18 16 19
21 to 25 yrs.15 17 18 17 18
26 to 30 yrs.14 16 17 18 17
31 to 35 yrs.13 15 16 17 16
36 to 40 yrs.12 14 15 16 15
41 to 45 yrs.11 13 14 15 14
46 to 50 yrs.10 12 13 13 12
51 to 55 yrs.9 11 11 11 10
56 to 60 yrs.8 10 09 8 8
61 to 65 yrs.6 08 07 5 6
Above 65 yrs.
5 05 05 5 541. Tribunals/courts adopt and apply different operative multipliers. Some follow the multiplier with reference to Susamma Thomas (set out in column 2 of the table above); some follow the multiplier with reference to Trilok Chandra, (set out in column 3 of the table above); some follow the multiplier with reference to Charlie (Set out in column (4) of the Table above); many follow the multiplier given in second column of the Table in the Second Schedule of MV Act (extracted in column 5 of the table above); and some follow the multiplier actually adopted in the Second Schedule while calculating the quantum of compensation (set out in column 6 of the table above). For example if the deceased is aged 38 years, the multiplier would be 12 as per Susamma Thomas, 14 as per Trilok Chandra, 15 as per Charlie, or 16 as per the multiplier given in column (2) of the Second schedule to the MV Act or 15 as per the multiplier actually adopted in the second Schedule to MV Act. Some Tribunals, as in this case, apply the multiplier of 22 by taking the balance years of service with reference to the retiring age. It is necessary to avoid this kind of inconsistency. We are concerned with cases falling under section 166 and not under section 163A of MV Act. In cases falling under section 166 of the MV Act, Davies method is applicable.
42. We therefore hold that the multiplier to be used should be as mentioned in column (4) of the Table above (prepared by applying Susamma Thomas, Trilok Chandra and Charlie), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years."
In view of the discussion made above the the claimants in this set of appeals are held entitled to the benefit of the multiplier with reference to the age of the deceased.
As to the award on account of future prospects, this issue is also no longer res-integra. It has categorically been answered by the Supreme Court in the case of National Insurance Company Limited Vs. Pranay Sethi and Ors (supra). Thus, the future prospects have to be included in the loss of income to determine the loss of dependency for award of compensation. The directions issued by the Supreme Court in this regard may be summarized in the chart below:-
Sl. No. The age of the deceased Loss of future prospects. (Deceased having permanent job) (as a % age of income) Loss of future prospects. (Deceased being self-employed/having fixed salary. As a % age of established income)
1.
Up to 40 years 50% 40%
2. 40 to 50 years 30% 25%
3. 50 to 60 years 15% 10% In view of the discussion made above the the claimants in this set of appeals are held entitled to the benefit of the same.
Even as to the issue of award of non-pecuniary losses the standardized formula has been laid down by the Supreme Court that may be summarized as below:
Year Loss of estate Loss of consortium Funeral expenses 2017-2019 Rs. 15,000/-
Rs. 40,000/-
Rs. 15,000/-
2020-2022 Rs. 16,500/-
Rs. 44,000/-
Rs. 16,500/-
2023-2025 Rs. 18,000/-
Rs. 48,000/-
Rs. 18,000/-
2026-2028 Rs. 19,500/-
Rs. 52,000/-
Rs. 19,500/-
In view of the discussion made above the the claimants in this set of appeals are held entitled to the benefit of the same.
Now, coming to the objections raised by the insurer in FAFO No. 4230 of 2017 that compensation may not be enhanced in the appeal filed by the insurer to which the claimant has not filed any cross objection, I am not inclined to accept the objection.
In this regard a division bench of this Court in the case of National Insurance Co. Ltd. Vs. Smt. Vidyawati Devi & Ors FAFO No. 2389 of 2016 decided on 27.07.2016 had the occasion to consider this precise objection raised by learned counsel for the appellant-insurer and it was held, as below:-
"We are of the considered view that the conditions as laid down in provisions of Order XLI Rule 33 are satisfied in the present case. In Delhi Electric Supply Undertaking (Supra) the Hon'ble Apex Court has observed that when circumstances exist which necessitate the exercise of discretion conferred by Rule 33, the court cannot be found wanting when it comes to exercise its powers.
Thus the argument in this regard made by the learned counsel for the appellant has no legs to stand and is not liable to be sustained.
Hon'ble Apex Court has laid down the principles to be followed while awarding compensation under non-pecuniary damages, such as loss of consortium, loss of love, care and guidance to children and funeral expenses. In the case of Rajesh and others v. Rajbir Singh and others, (2013) 9 SCC 54 and Kalpanaraj and others vs. Tamil Nadu State Transport Corporation, 2014(3) TAC 707(SC) Hon'ble Apex Court has held that guiding principle for determining compensation is that it must be just and reasonable and the Court should not succumb to niceties or technicalities, in such matters while considering the issue of award of compensation under non-pecuniary damages such as loss of consortium, loss of love, care and guidance to children and funeral expenses. It has been observed in paragraph 17 as under :
"17. The ratio of a decision of this Court, on a legal issue is a precedent. But an observation made by this Court, mainly to achieve uniformity and consistency on a socio-economic issue, as contrasted from a legal principle, though a precedent, can be, and in fact ought to be periodically revisited, as observed in Santosh Devi. We may therefore, revisit the practise of awarding compensation under conventional heads: loss of consortium to thee spouse, loss of love, care and guidance to children and funeral expenses. It may be noted that the sum of Rs. 2500 to Rs. 10,000 in those heads was fixed several decades ago and having regard to inflation factor, the same needs to be increased. In Sarla Verma case, it was held that compensation for loss of consortium should be in the range of Rs. 5000 to 10,000. In legal parlance. "consortium" is the right of the spouse to the company, care, help, comfort, guidance, society, solace, affection and sexual relations with his or her mate. That non-pecuniary head of damages has not been properly understood by our courts. The loss of companionship, love, care and protection. etc., the spouse is entitled to get, has to be compensated appropriately. The concept of non-pecuniary damage for loss of consortium is one of the major heads of award of compensation in other parts of the world more particularly in the United State of America, Australia, etc. English courts have also recognized the right of a spouse to get compensation even during the period of temporary disablement. By loss of consortium, the courts have made an attempt to compensate the loss of spouse's affection, comfort, solace, companionship, society, assistance, protection, care and sexual relations during the future years. Unlike the compensation awarded in other countries and other jurisdictions, since the legal heirs are otherwise adequately compensated for the pecuniary loss, it would not be proper to award a major amount under this head. Hence, we are of the view that it would only be just and reasonable that the court awards at least rupees one lakh for loss of consortium."
The same view has been reaffirmed in the case of Kalpanaraj and others (supra). In the said case, Hon'ble Apex Court raised compensation of Rs.30,000/- awarded towards loss of consortium and Rs.20,000/- towards loss of love and affection of the minor children to Rs.1,00,000/- each under the said heads finding the sum awarded to be on the lower side in the light of principles laid down in the case of Rajesh (supra)."
The above, reasoning of the division bench of this Court appears to be consistent with the decision of the Supreme Court in Jitendra Khimshankar Trivedi & Ors Vs. Kasam Daud Kumbhar & Ors reported in 2015 (4) SCC 237 wherein the Supreme Court has held as below:-
"13. The tribunal has awarded Rs. 2,24,000/- as against the same, claimants have not filed any appeal. As against the award passed by the tribunal when the claimants have not filed any appeal, the question arises whether the income of the deceased could be increased and compensation could be enhanced. In terms of Section 168 of the Motor Vehicles Act, the courts/tribunals are to pass awards determining the amount of compensation as to be fair and reasonable and accepted by the legal standards. The power of the courts in awarding reasonable compensation was emphasized by this Court in Nagappa vs. Gurudayal Singh & Ors. 2003 2 SCC 274, Oriental Insurance Company Ltd. vs. Mohd. Nasir & Anr. 2009 6 SCC 280 and Ningamma & Anr. vs. United India Insurance Company Ltd. 2009 13 SCC 710. As against the award passed by the tribunal even though the claimants have not filed any appeal, as it is obligatory on the part of courts/tribunals to award just and reasonable compensation, it is appropriate to increase the compensation.
14. In order to award just and reasonable compensation income of the deceased is taken as Rs. 3,000/- per month. Deducting 1/3rd for personal expenses contribution of the deceased and the family is calculated at Rs. 2,000/- per month. At the time of her death deceased Jayvantiben was aged about 22 years, proper multiplier to be adopted is 18. Adopting multiplier of 18, total loss of dependency is calculated at Rs. 4,32,000/- (Rs. 2,000 X 12 X 18). With respect to the award of compensation under conventional heads, tribunal has awarded Rs. 5,000/- towards loss of estate and Rs. 3,000/- towards funeral expenses totaling Rs. 8,000/-. The High Court has awarded conventional damages of Rs. 15,000/- i.e. Rs. 10,000/- towards loss of estate and Rs. 5,000/- towards funeral expenses. The courts below have not awarded any compensation towards loss of consortium and towards love and affection. In Rajesh & Ors. vs. Rajbir Singh & Ors., 2013 9 SCC 54 and Jiju Kuruvila & Ors. vs. Kunjujamma Mohan & Ors., 2013 9 SCC 166 this Court has awarded substantial amount of Rs. 1,00,000/- towards loss of consortium and Rs. 1,00,000/- towards loss of love and affection. Following the same, in the case in hand, Rs. 1,00,000/- is awarded towards loss of consortium and Rs. 1,00,000/- towards loss of love and affection to the minor children. Towards loss of estate and funeral expenses, award of compensation of Rs. 15,000/- awarded by the High Court is maintained. Thus, the claimants are entitled to a total compensation of Rs. 6,47,000/-."
(emphasis supplied) Then, again the Supreme Court has in the case of United India Insurance Co. Ltd. v. Shila Datta, (2011) 10 SCC 509 has held as below :
"10. A claim petition for compensation in regard to a motor accident (filed by the injured or in case of death, by the dependent family members) before the Motor Accidents Claims Tribunal constituted under Section 165 of the Act is neither a suit nor an adversarial lis in the traditional sense. It is a proceedings in terms of and regulated by the provisions of Chapter XII of the Act which is a complete code in itself. We may in this context refer to the following significant aspects in regard to the Tribunals and determination of compensation by the Tribunals:
(i) Proceedings for award of compensation in regard to a motor accident before the Tribunal can be initiated either on an application for compensation made by the persons aggrieved (the claimants) under Section 166(1) or Section 163-A of the Act or suo motu by the Tribunal, by treating any report of accident (forwarded to the Tribunal under Section 158(6) of the Act as an application for compensation under Section 166(4) of the Act).
(ii) The rules of pleadings do not strictly apply as the claimant is required to make an application in a form prescribed under the Act. In fact, there is no pleading where the proceedings are suo motu initiated by the Tribunal.
(iii) In a proceedings initiated suo motu by the Tribunal, the owner and driver are the respondents. The insurer is not a respondent, but a notice under Section 149(2) of the Act. Where a claim petition is filed by the injured or by the legal representatives of a person dying in a motor accident, the driver and owner have to be impleaded as respondents. The claimants need not implead the insurer as a party. But they have the choice of impleading the insurer also as a party-respondent. When it is not impleaded as a party, the Tribunal is required to issue a notice under Section 149(2) of the Act. If the insurer is impleaded as a party, it is issued as a regular notice of the proceedings.
(iv) The words "receipt of an application for compensation" in Section 168 refer not only to an application filed by the claimants claiming compensation but also to a suo motu registration of an application for compensation under Section 166(4) of the Act on the basis of a report of an accident under Section 158(6) of the Act.
(v) Though the Tribunal adjudicates on a claim and determines the compensation, it does not do so as in an adversarial litigation. On receipt of an application (either from the applicant or suo motu registration), the Tribunal gives notice to the insurer under Section 149(2) of the Act, gives an opportunity of being heard to the parties to the claim petition as also the insurer, holds an inquiry into the claim and makes an award determining the amount of compensation which appears to it to be just. (Vide Section 168 of the Act.)
(vi) The Tribunal is required to follow such summary procedure as it thinks fit. It may choose one or more persons possessing special knowledge of and matters relevant to inquiry, to assist it in holding the enquiry. (Vide Section 169 of the Act.)
(vii) The award of the Tribunal should specify the person(s) to whom compensation should be paid. It should also specify the amount which shall be paid by the insurer or owner or driver of the vehicle involved in the accident or by all or any of them. (Vide Section 168 of the Act.)
(viii) The Tribunal should deliver copies of the award to the parties concerned within 15 days from the date of the award. (Vide Section 168(2) of the Act.) We have referred to the aforesaid provisions to show that an award by the Tribunal cannot be seen as an adversarial adjudication between the litigating parties to a dispute, but a statutory determination of compensation on the occurrence of an accident, after due enquiry, in accordance with the statute."
(emphasis supplied) Therefore, applying the law laid down by the division bench in case of National Insurance Co. Ltd. Vs. Vidyawati Devi (supra), and also in view of the fact that upon the insurer challenging the award on a ground (in this case of less deduction for personal expenses) and that ground being sustained, the court cannot close its eyes to the fact that a wrong multiplier had been applied and other amounts as were due to the claimants had not been paid. To that extent and for that purpose it has to be examined whether the compensation awarded is just, fair, reasonable and proper keeping in mind the standardized formula laid down by the Supreme Court discussed above.
In context of non-adversarial litigation, the Court cannot close it's eyes to the result that would follow if it were to only consider and allow the ground of appeal raised by the insurer. It would result in the award being made of an amount that would be neither just, nor fair, nor reasonable nor proper. For e.g. if the personal expenses deducted at 1/3 is increased to 1/2 in the instance of the insurer, it would result in reduction of the compensation though, as a fact it cannot be denied that the compensation had been determined by applying a lower multiplier than that should have been applied by the Tribunal.
Thus, these proceedings being not truly adversarial and the enhancement proposed being really in the nature of correction of the award on the basis of correct multiplier or principle or formula being applied in accordance with law laid down by the Supreme Court without fresh reappraisal of evidence and not involving a fresh finding of fact or reappraisal of evidence it may not be resisted because a cross-appeal may not have been filed.
The issue of determination of just and fair compensation has to be treated to be open for examination to offer correction at least on the basis of binding principle and/or formula laid down by the Supreme Court. It has to be so, because the claimant may not have contested the award in view of the total amount awarded being acceptable to him. He may not have then been concerned about the exactness or correctness of the method adopted to reach that amount.
Thus computation of the amount may have to be done after giving effect to the correct legal principle in order to ensure that the compensation awarded is just, fair, reasonable, proper and now also consistent with the standardised formula laid down by the Supreme Court.
Clearly, in the case at hand the enhancement proposed to be made is not on account of a different finding of fact being recorded by this Court or on re-appreciation of evidence, but the enhancement may result on account of correct principle or formula laid down by the Supreme Court being applied. The jurisdiction of the Tribunal and this Court being to award that amount of compensation which is just, fair, proper and reasonable as per standardized norms, I reject the objection in the facts of the present appeal.
In view of the discussion made above, I find this to a fit case to exercise my discretion under Order XLI Rule 33 of the Civil Procedure Code to cure the injustice that may otherwise result to the respondent-claimants if the discretion is not exercised. However, such discretion is being confined to apply the correct principle and governing formula laid down by the Supreme Court, as discussed above, without interfering with findings of fact recorded by the Tribunal and without reappraising evidence.
Also, the enhancement as proposed does not result in an exorbitant increase in the compensation awarded but is only in the nature of correction in the computation in light of the law laid down by the Supreme Court as discussed above.
Thus, all the appeals filed by the claimants being FAFO No. 3484 of 2012, FAFO No. 1199 of 2016, FAFO No. 1820 of 2002 deserves to be allowed. On the other hand, FAFO No. 4230 of 2017 has also to be allowed on the ground raised therein. However, the revised amount of compensation would be more than that awarded by the Tribunal.
Thus, the amount of compensation being enhanced or corrected would be as below:
FAFO No. 3484 of 2012:
In view of the fact that the age of the deceased was 16 years and there was no evidence led by the claimant to establish the income of the deceased. However, the notional income estimated by the Tribunal at Rs. 15,000/- is too less (@ Rs. 50/- per day). The same is enhanced to Rs. 36,000/- per annum, the claimant having disclosed the deceased to be a manual labourer to bring it in conformity with and consistent with such assumptions made in numerous cases decided by the Supreme Court and this Court. Thereafter, the Tribunal has made a deduction of 50% to the aforesaid notional income of the deceased on account of personal expenses. The same may be sustained in view of the fact that the deceased was a bachelor. Again there being no "established income" and compensation being awarded on basis of a notional income only there is no room to make an addition on account of future prospects. Thus, applying the multiplier of 18 with reference to the age of the deceased, the total compensation towards loss of dependency is Rs. 3,24,000/- (18,000 X 18).
Then, it is seen, only Rs. 2,000/- had been awarded by the Tribunal towards funeral expenses and no other amount had been awarded on account of non-pecuniary losses. Keeping the principle laid down by the Supreme Court in the case of National Insurance Company Ltd. Vs. Pranay Sethi and Ors. (supra) and considering computation of loss of estate and funeral expenses to have been pegged at Rs. 15,000/- each in the year 2017 and further considering the fact that the deceased in the present died in the year 2010, the said amounts are awarded at Rs. 12,000/- each (i.e. on account of funeral expenses and loss of estate). The award for funeral expenses would include the amount of Rs. 2,000/- awarded by the Tribunal on that count. Thus, the total amount of compensation is enhanced to Rs. 3,48,000/- from Rs. 1,22,000/- awarded by the Tribunal. The differential amount of compensation together with interest @ 9% from the date of filing of the claim petition shall be paid out by the insurer to the claimant-appellant within a period of three months from today.FAFO No. 1199 of 2016
Age of the deceased was 27 years on 29.11.2003. The correct multiplier to be applied would be 17 and not 11 as held by the Tribunal. Then, it is seen that the deceased was working on a fixed income of Rs. 3,000/- per month. As to future prospects, it is seen, in view of the judgment of the Supreme Court in National Insurance Company Limited Vs. Pranay Sethi and Ors (supra) the claimants are entitled to benefit of future prospects @ 40%. Also, deduction @ 50% is warranted towards personal expenses, in terms of the judgment of the Supreme Court in Sarla Verma (supra). The annual loss of dependency of the claimants is thus computed at Rs. 25,200/-. Total compensation for loss of dependency thus comes to Rs. 4,28,400/- (25,200 X 17). Over and above, the Tribunal has awarded Rs. 2,500/- to the claimant for loss of estate and Rs. 2,000/- towards funeral expenses. Keeping the principle laid down by the Supreme Court in the case of National Insurance Company Ltd. Vs. Pranay Sethi and Ors. (supra) and considering computation of loss of estate and funeral expenses to have been pegged at Rs. 15,000/- each in the year 2017 and further considering the fact that the deceased in the present died in the year 2003, the said amounts are awarded at Rs. 10,000/- each (i.e. on account of funeral expenses and loss of estate). The award for funeral expenses would include the amount of Rs. 2,000/- awarded by the Tribunal on that count. Thus, the total amount of compensation is enhanced to Rs. 4,48,400/- from Rs. 2,68,500/- awarded by the Tribunal. The differential amount of compensation together with interest @ 9% from the date of filing of the claim petition shall be paid out by the insurer to the claimant-appellant within a period of three months from today.FAFO No. 1820 of 2002
Age of the deceased was 23 years as on 08.09.1997. The Tribunal has estimated the income of the deceased at Rs. 5,000/- per month. In this case only oral evidence was led by the claimant/mother of the deceased that though the deceased was a bachelor, he had been sending her money every month ranging between Rs. 3,000 to 3,500/-. The same has rightly been not accepted by the Tribunal. Deduction of Rs. 2,500/- per month is made towards personal expenses by applying the principle in that regard laid down in by the Supreme Court in the case of Sarla Verma (supra). Then, applying the rule laid down by the Supreme Court in the case of National Insurance Company Limited Vs. Pranay Sethi and Ors (supra), benefit of future prospects is to be given @ 40%. It results in an annual loss of dependency at Rs. 42,000/-. Applying the multiplier 18 as laid down in Sarla Verma (supra) total compensation for loss of dependency comes to Rs. 7,56,000/- (Rs. 42,000 X 18). Over and above, the Tribunal has awarded Rs. 10,000/- towards loss of love and affection and Rs. 5,000/- towards funeral expenses. Considering that the accident occurred in the year 1997, no further enhancement is warranted on account of non-pecuniary losses in the present case. Thus, the total amount of compensation is enhanced to Rs. 7,71,000/- from Rs. 1,35,000/- awarded by the Tribunal. The differential amount of compensation together with interest @ 9% from the date of filing of the claim petition shall be paid out by the insurer to the claimant-appellant within a period of three months from today.FAFO No. 4230 of 2017
The age of the deceased being 20 years. Thus, a multiplier of 18 should have been applied by the Tribunal in view of law laid down by the Supreme Court in National Insurance Company Limited Vs. Pranay Sethi and Ors (supra). The income of the deceased having been estimated at Rs. 45,000/- per annum deduction on account of personal expenses should have been made at Rs. 22,500/-. Consequently, annual loss of dependency should have been computed at Rs. 22,500/- by the Tribunal in absence of any evidence lead by the claimants to draw an exception to the general rule laid down in Sarla Verma (supra). Then, in view of the judgment of the Supreme Court in the case of National Insurance Company Limited Vs. Pranay Sethi and Ors (supra), if the claimants were held entitled to future prospects @ 40%. The total annual loss of dependency would be computed at Rs. 31,500/- (Rs. 22,500 + Rs. 9,000). Applying the multiplier of 18, the compensation for loss of dependency is computed at Rs. 5,67,000/- (31,500 X 18).
Then, it is seen that Rs. 2,000/- and Rs. 2,500/- had been awarded by the Tribunal towards funeral expenses and loss of estate. In view of the fact that the Supreme Court has enhanced the amount to Rs. 15,000/- each vide judgment in National Insurance Company Limited Vs. Pranay Sethi and Ors (supra) the compensation for loss of estate and funeral expenses is awarded @ Rs. 12,000/- each. The appeal filed by the insurer is thus dismissed.
The award having been made contrary to the authoritative pronouncement of the Supreme Court, both on count of short deduction of personal expenses that would result in reduction of the compensation amount awarded and also on account of application of a lesser multiplier which corrected results in enhancement of the compensation awarded. Under the interim order of this Court dated 09.02.2012, only 35% of compensation awarded has been paid out to the claimants. The balance amount of compensation (as computed by this judgment) together with interest as awarded shall now be paid out to the claimants within a period of three months from today.
Consequently, the First Appeal From Order Nos. 3484 of 2012, 1199 of 2016 and 1820 of 2002 are allowed. First Appeal From Order No. 4230 of 2017 is also allowed. However, the amount of compensation awarded in that case would also stand enhanced as above. No order as to costs.
Order Date: 19.01.2018 Lbm/-