Madras High Court
The Oriental Insurance vs Mariam Shanthi David on 25 September, 2013
Author: S.Vimala
Bench: S.Vimala
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 25.09.2013
CORAM:
THE HONOURABLE MRS.JUSTICE S.VIMALA
C.M.A.No.758 of 2003
and C.M.P.No.5497 of 2003
The Oriental Insurance
Company Limited,
Chennai 2 .. Appellant
..Vs..
1. Mariam Shanthi David
2. Karun Philip Idikullah
(Minor) Son of Late Idikullah Philip
(Minor Rep. By mother, R-1)
(2nd respondent declared as major and
discharged his mother, R-1, Mariam
Shanthi David, from guardianship
vide order, dated 24.03.04,
made in CMP Nos.3211 & 3212 / 04)
3. Sosamma Philip (died)
4. Mr. Mary Philip
5. Elipe A.Philip
6. Achamma Philip
7. M/s. Jayalakshmi Agency,
Dealer, Indian Oil,
No.97/A, Katpadi, Vellore 632 007
(R-4 to R-6 impleaded as LRs of R-3,
vide the order of this Court, dated
25.09.2013) .. Respondents
Civil Miscellaneous Appeal filed under Section 173 of the Motor Vehicles Act, 1988, against the award and decree, dated 03.05.2002, made in MACT OP No.2377 of 2000 on the file of the Motor Accident Claims Tribunal (III Judge, Small Causes Court), Chennai.
For Appellant : Mr. S.J.Jagadev
For Respondents : Mr. K.padmanabhan, for R-1 to R-3
R-4, Given-up
- - -
J U D G M E N T
The deceased, Idikullah Philip, aged 45 years, employed as Plant Manager, MRF Limited, earning a sum of Rs.22,758/-, died in an accident that took place on 19.10.1994. The wife, son and mother claimed a sum of Rs.63,50,000/- in MCOP No.174 of 1995 (at Vellore), which was re-numbered as MCOP No.2377 of 2000 (at Chennai). The Tribunal awarded a sum of Rs.22,44,871/- as compensation.
2. The details of the award are as follows:-
Loss of dependency - Rs.21,97,871.00 Loss of Consortium to P-1 - Rs. 15,000.00 Loss of love and affection to P-2 Rs. 10,000.00 Loss of expectation of life - Rs. 20,000.00 Funeral expenses - Rs. 2,000.00
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Rs.22,44,871.00
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3. While assessing loss of dependency, the Tribunal has considered Exs.P-8 and P-10. Under Ex.P-10, in the returns filed before the Income-Tax Authorities, the annual income of the deceased has been shown as Rs.96,768/- and the monthly income would be Rs.8,064/-. Under Ex.P-8 the monthly income of the deceased is Rs.15,950/-, which includes the salary of Rs.8,150/- and allowances. While arriving at loss of dependency, the annual income has been taken at Rs.1,13,200/- and deducting 1/3rd towards personal expenses i.e., 37,733/-, the annual dependency has been taken at Rs.75,467/-. Adding a sum of Rs.93,600/- as allowance total dependency is taken at Rs.1,69,067/-. Adopting multiplier of '13' loss of dependency has been fixed at Rs.21,97,871/-.
4. Aggrieved over the quantum of compensation awarded under the head of loss of dependency, the Insurance Company has preferred the appeal.
5. The specific contention is that Ex.P-8 salary certificate should alone be the basis for arriving at the quantum on loss of dependency and in that case, the compensation should not have exceeded Rs.16,64,000/-. In other words, the contention is that the Tribunal committed error in excess allotment of a sum of Rs.5,30,000/-, than what is due / just.
5.1. Another ground is that the interest should have been awarded only from the date on which MCOP No.2377 of 2000 was re-numbered before the Claims Tribunal at Chennai and not from the date on which it was numbered at Vellore, during 1995. Only on these grounds, this appeal has been filed.
6. Admittedly, the claim petition has been filed at Vellore and later on, it has been transferred to Chennai at the initiative of the claim petitioner. It is not the case of the appellant that the appellant was ready to settle the claim of the petitioners / respondents herein and that they did not cooperate.
6.1. Exercising their right, for the sake of convenience, as per their entitlement the claimants got the case transferred. Therefore, there is no substance in the contention that the interest should have been allowed only from the date on which the case was transferred to the file of the Tribunal at Chennai.
7. So far as compensation on account of loss of dependency is concerned, the main contention is that the monthly income should have been assessed only on the basis of Ex.P-8 which is the last drawn salary of the deceased and Exs.P-15 and P-16 should not have been the basis for calculating the monthly income. Ex.P-16 is the salary certificate of one Mr.P.M.Jacob, who is said to be a person who was similarly placed (in rank) as that of the deceased and also to show that at the time of super-annuation the deceased would have been earning a sum of Rs.79,643/-.
8. In view of the contentions raised, it is necessary to find out whether Ex.P-8 should be the basis for calculating the loss of dependency or Exs.P-15 and P-16.
8.1. The principle to be adopted has been indicated in the decision reported in AIR 1994 SC 1 (G.M.Kerala State Road Transport Corporation v. Susomma Thomas) wherein the method of calculation has been indicated where there is a possibility of rapid upward swing in the carrier for the deceased:-
Of course, the future prospects of advancement in life and career should also be sounded in terms of money to augment the multiplicand. While the chance of the multiplier is determined by two factors, namely, the rate of interest appropriate to a stable economy and the age of the deceased or of the claimant whichever is higher, the ascertainment 7 (1961) 3 All ER 323 : (1962) 2 QB 210 (CA) 8 (1981) 1 All ER 578 : (1981) 2 WLR 278 9 1962 MPLJ 426: 1983 ACJ 221 (MP) of the multiplicand is a more difficult exercise. Indeed, many factors have to be put into the scales to evaluate the contingencies of the future. All contingencies of the future need not necessarily be baneful. The deceased person in this case had a more or less stable job. It will not be inappropriate to take a reasonably liberal view of the prospects of the future and in estimating the gross income it will be unreasonable to estimate the loss of dependency on the present actual income.... 8.2. This decision would show that the contention of the appellant that the salary as on date of the death should be the basis for ascertaining the compensation is liable to be rejected.
8.3. Ex.P-16 is the Certificate given by the Director, Human Resources and Services of MRF Limited, dated 15.03.2001, certifying the Salary / perks drawn by M.A.Jacob as on 15.03.2001 was Rs.79,643/-. This certificate can be taken only to the extent of inferring that there would have been future increase in the earnings of the deceased as it happened in the case of any other employee. Ex.P-16, certificate is supported by documents furnishing details of allowances, i.e., Leave Travel Assistance, Self Development Subsidy, Medical Reimbursement, Educational Allowance and Performance Incentive, which are given to employees. The salary to Mr.P.M.Jacob, in the month of February 2001 has been stated to be Rs.34,450/-. From this document, it would be evident that there are chances of the deceased having obtained higher salary and higher perks, had he been alive.
8.4. Under Ex.P-15 a certificate has been issued by MRF Limited certifying that the salary and allowances together payable to the deceased was Rs.22,758/-. Under Ex.P-8 pay-slip of the deceased has been filed where-under the gross/total salary has been shown as Rs.15,950/-. This is for the month of September 1994. Relying upon Ex.P-8, it is contended that the actual salary should be taken as the basis for calculation and the future anticipated increase as per Ex.P-15 should not be taken into account.
8.5. While calculating the future loss, it is imperative that the future anticipated increase in the salary / perks should be taken into account. It is the contention of the appellant that the person to whom Ex.P-16 certificate is issued has not been examined and therefore, Ex.P-16 salary certificate of the co-employee should not be taken into account.
8.6. This contention can be partly accepted as the qualification of the person and the date of his employment are relevant factors to be taken into account. But so far as Ex.P-15 is concerned, it can be relied upon as the Corporate Manager of MRF Limited has been examined. He has spoken about the fact that he had been employed there for the past thirty years and what would be the income had the deceased been alive. In fact, he has spoken about Ex.P-16 also. Therefore, the contention that Ex.P-15 should not be relied upon cannot be accepted. It is also common knowledge that the service conditions of the Corporate Sector are always higher compared to the employees of the private sector.
8.7. The learned counsel for the respondents contended that quantification has not been done properly by the Claims Tribunal and the future anticipated income should have been considered by the claims Tribunal and there is no impediment to award higher compensation to the claimants even in the absence of cross-appeal.
8.8. The principle relating to power of the appellate court to enhance compensation in the absence of cross-objection has been discussed in the decision of the Delhi High Court reported in MANU/DE/2870/2012 (National Insurance Company v. Komal) and in the case of New India Assurance Company v. Gopal, 2012 (6) SCALE 534, wherein the Supreme Court suo motu enhanced the compensation from Rs.7,40,000/- to Rs.10,63,040/- in an appeal filed by the Insurance Company. Therefore, there is no impediment to enhance the compensation even in the absence of cross-appeal.
8.9. It is contended that 30% of the increase has to be added to Rs.22,758/- and in that case the monthly income would be Rs.29,585/-. Deducting 1/3rd towards personal expenses and adopting multiplier of '13', a sum of Rs.36,76,871/- (Rs.19,723.50 x 12 x 13) is claimed towards loss of dependency. Learned counsel for the claimants also claim a sum of Rs.25,000/- towards funeral expenses and Rs.2,00,000/- towards the loss of love and affection to wife and mother and Rs.1,00,000/- towards loss of love and affection to the minor son. This huge amount of non-conventional damages cannot be granted to the extent claimed, as the accident had taken place in the year 1995 and the enhancement itself is considered in the absence of cross-objection.
9. Only when there is no evidence regarding the exact increase in the future income, notional increase of 30% increase is adopted. But in this case when the accident has taken place in the year 1994 and what would be the exact increase in 2001 has been brought on record. During 1994, the salary had been around Rs.15,000/- and during 2001 the salary had been Rs.22,000/-. The increase had been Rs.7,000/- in seven years. Therefore, the increase had been roughly 48%. There is manifold increase in perquisites also. Therefore, the income can be fixed at Rs.24,000/- per month. Deducting 1/4th towards personal expenses, the contribution would be Rs.18,000/-. Adopting multiplier of '14', the compensation would be Rs.30,24,000/- (Rs.18,000/- x 12 x 14). This would be the increase when the deceased continues to function in the same rank.
9.1. Evidence has been let in to show that there would be chances of promotion also. In that case, there is possibility of further increase in the pay and allowances would be more.
9.2. Awarding a sum of Rs.25,000/- towards the loss of consortium to the wife and Rs.50,000/- each to the loss of love and affection to the second and third petitioners and Rs.2,000/- towards funeral expenses, the total compensation payable would be Rs.31,51,000/-.
10. In the result, the Civil Miscellaneous Appeal is dismissed. However, the Transport Corporation is directed to deposit the compensation amount of Rs.31,51,000/-, with interest at 7.5% per annum from the date of petition, less the amount already deposited, if any, within a period of six weeks from the date of receipt of a copy of this judgment. On such deposit, the claimants are entitled to withdraw the amount in the same proportion as ordered by the Tribunal. As the third respondent is reported dead, the Tribunal shall disburse the amount to the legal representative of the third respondent, subject to proof being produced to prove the status. No costs. Consequently, the connected CMP is closed.
25.09.2013 Index : Yes / No Web : Yes / No srk To
1. Motor Accident Claims Tribunal (III Judge, Small Causes Court), Chennai
2. The Section Officer, V.R.Section, High Court, Madras S.VIMALA, J., srk C.M.A.No.758 of 2003 and C.M.P.No.5497 of 2003 25.09.2013