Allahabad High Court
Bajrang Prasad Tiwari vs Smt. Lalti Devi & Others on 5 May, 2014
Author: Tarun Agarwala
Bench: Tarun Agarwala, Dinesh Gupta
HIGH COURT OF JUDICATURE AT ALLAHABAD AFR Court No. - 2 Case :- FIRST APPEAL FROM ORDER No. - 748 of 2004 Appellant :- Bajrang Prasad Tiwari Respondent :- Smt. Lalti Devi & Others Counsel for Appellant :- Ram Singh Counsel for Respondent :- Saurabh Srivastava,Saurabh Srivastava,Vinod Kumar Hon'ble Tarun Agarwala,J.
Hon'ble Dinesh Gupta,J.
This is the claimant's appeal for enhancement of the compensation awarded by the Tribunal under Motor Vehicles Act . The deceased was 17 years old at the time of death which occurred on 17.3.2001 and was earning @ Rs.125 per day on a fixed salary given by the employer. The Tribunal calculated the income @ Rs.2500/ per month considering that he used to work 20-22 days in a month. Being unmarried, the Tribunal considered that the deceased would spend two third of his earning on himself. The Tribunal also took the age of the claimants, namely, the parents average age in fixing the multiplier of 15, and on that basis,awarded a sum of Rs.1,55,000/(One lac fifty five thousand)as compensation.
Before this Court the learned counsel for the appellant submitted that admittedly the deceased was getting a fixed salary @ Rs.125/ per day and, on that basis, his monthly income should be Rs.3000/ per month whereas the Tribunal has awarded compensation taking his salary at Rs.2500/- per month and therefore, the award was incorrect. The learned counsel submitted that the multiplier of 15 is also incorrect and as per the decision of the Supreme Court in Smt. Sarla Verma and Others Vs Delhi Transport Corporation and Others ,2009(2) T.A.C.677(S.C.) the age of the deceased alone has to be considered and therefore the multiplier of 18 should be taken into account. Further, deduction of 2/3 on his personal expenses was on a higher side , in view of the decision in Smt. Sarla Verma (Supra), in which it has been held that the deduction of 50% should be made.
The learned counsel for the appellant further submitted that future prospects has not been taken into consideration and consequently 50% of the income should be enhanced under the category of "future prospects" and thereafter the compensation should be computed.
On the other hand, the learned counsel for the Insurance Company contended that the income taken by the Tribunal was perfectly justified and, an average of 22 days was taken into consideration which requires no interference. Further, the age of the parents was to be taken into consideration and only the average age of the parents is required to be considered in the light of the decision of the Supreme Court in 2007(4)T.A.C.17 S.C. New India Assurance Company Limited Vs Smt Shanti Pathak and others and consequently a multiplier of 15 was rightly taken into consideration by the Tribunal which does not require any interference.
The learned counsel for the Insurance Company further submitted that admittedly the deceased was a salaried person and ,in view of the decision of the Supreme Court in 2013(2)ACCD 977(SC)Reshma Kumari and others Vs Madan Mohan and another,the future prospects for fixed income was not required to be considered.
Having heard the learned counsel for the parties at some length we find that the award of the Tribunal is required to be modified. From a perusal of the evidence which has come on record, we find that the employer has categorically stated in his deposition that the deceased used to work 20-22 days per month @ Rs.125/ per day and, on that basis ,the Tribunal calculated the average income at Rs.2500/ per month . This calculation in our view is based upon a correct appreciation of the evidence which does not require any interference . We consequently hold that the income of the deceased was Rs.2500/ per month .
In the case of Smt. Sarla Verma and Others (Supra ) the Supreme Court held that uniformity should be maintained for determining the compensation in cases of death by following certain well settled laws one of which was with regard to ascertaining the multiplier.
In paragraph 9, the Supreme Court held :
"Step 2( ascertaining the multiplier) Having regard to the age of the deceased and the period of active career, the appropriate multiplier should be selected. This does not mean ascertaining the number of years he would have lived or worked but for the accident. Having regard to several imponderables in life and economic factors , a table of multipliers with reference to the age has been identified by this Court. The multiplier should be chosen from the said table with reference to the age of the deceased. "
While summarising the matter the Supreme Court directed that the multiplier, as indicated in paragraph 21 should be used. For facility paragraph 20+21 is extracted hereinbelow:
"20...................We are concerned with cases falling under Section 166 and not under Section 163A of the M.V.Act In cases falling under Section 166 of the M.V.Act Davies method is applicable.
"21.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 group 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, M13 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 the light of the aforesaid the age of the deceased being 17 years a multiplier of 18 should be used instead of 15.
In JT 2011(7)SC135 National Insurance Company Ltd Vs Shyam Singh and others and in 2007(4)T.A.C.17(S.C.) New India Assurance Company Limited Vs Smt. Shanti Pathak and others the Supreme Court held that the age of the parents should be considered for the purpose of finding out the multiplier . However, we find in Sarla Verma's Case(Supra) the Supreme Court has categorically stated that the multiplier in the case of deceased should be considered on the basis of the multiplier fixed in paragraph 21 of said judgement. The Supreme Court, in a recent decision in M.Mansoor and another Vs United India Insurance Company and another 2013,(4)T.A.C.832(S.C.) has reiterated that the multiplier should be determined on the basis of age of the deceased. The Supreme Court reiterated this fact after considering its earlier decision in Amrit Bhanu Shali and others Vs National Insurance Company ,2012(11) S.C.C 738:2012(4)T.A.C.775 wherein the Supreme Court held as under:
"15 The selection of multiplier is based on the age of the deceased and not on the basis of the age of the dependent. There may be a number of dependants of the deceased whose age may be different and therefore the age of the dependants has no nexus with the computation of compensation."
In the light of the aforesaid ,we are inclined to follow the principle that the age of the deceased is required to be considered while selecting the multiplier . Accordingly, we find that in view of the decision of the Supreme Court in Sarla Verma's case (Supra), the multiplier of 18 is to be fixed instead of 15.
With regard to deduction of 2/3rd income for personal expenses, we find that deduction should be 50% instead of 2/3rd in view of the decision of the Supreme Court in Sarla Verma's Case (Supra).The Supreme Court in Sarla Verma's Case(Supra) held:
"15. Where the deceased was a bachelor and the claimants are the parents, the deduction follows a different principle. In regard to bachelor, normally, 50% is deducted as personal and living expenses because it is assumed that a bachelor would tend to spend more on himself. Even otherwise, there is also the possibility of his getting married in a short time , in which event the contribution to the parent/s and siblings is likely to be cut drastically. Further , subject to evidence to the contrary , the father is likely to have his own income and will not be considered as a dependant and the mother alone will be considered as a dependent . In the absence of evidence to the contrary, brothers and sisters will not be considered dependants, because they will either be independent and earning or married, or be dependant on the father. Thus, even if the deceased is survived by parents and siblings only the mother would be considered to be a dependant, and 50% would be treated as the personal and living expenses of the bachelor and 50% as the contribution to the family. However, where family of the bachelor large and dependant on the income of the deceased, as in a case where he has widowed mother and large number of younger non-earning sisters or brothers, his personal and living expenses may be restricted to one-third and contribution to the family will be taken as two third."
Accordingly, we hold that a deduction of 50% should have been made instead of two third from the deceased's income.
With regard to the future prospect the learned counsel for Insurance Company placed reliance upon a decision of the Supreme Court in 2013(2)ACCD 977(SC)Reshma Kumari and others Vs Madan Mohan and another wherein the Supreme Court held that in a case where the deceased was self employed or was employed on a fixed salary without provision for annual increments, the actual income at the time of death without any addition to income for future prospects would be appropriate and that a departure from the above principles could only be justified in extraordinary circumstances and in very exceptional cases.
For facility, paragraph 36 of the judgement is extracted hereinunder:
"36.The standardization of addition to income for future prospects shall help in achieving certainty in arriving at appropriate compensation. We approve the method that an addition of 50% of actual salary be made to the actual salary income of the deceased towards future prospects where the deceased had a permanent job and was below 40 years and the addition should be only 30% if the age of the deceased was 40 to 50 years and no addition should be made where the age of the deceased is more than 50 years. Where the annual income is in the taxable range , the actual salary shall mean actual salary less tax. In the cases where the deceased was self employed or was on a fixed salary without without provision for annual increments, the actual income at the time of death without any addition to income for future prospect will be appropriate. A departure from the above principles can only be justified in extraordinary circumstances and very exceptional cases."
It may be noted here that this decision was delivered by the Supreme Court on 2nd April 2013 . We however find that Supreme Court delivered another decision in Rajesh and others Vs Rajbir Singh and others 2013(2)ACCD 960(S.C.) on 12.4.2013 wherein the Supreme Court relying on its earlier decision in Santosh Devi Vs National Insurance Company Limited and others 2012, 6 SCC(421) and Sarla Verma(Supra) held :
"11.Since the Court in Santosh Devi's case (Supra) actually intended to follow the principle in the case of salaried persons s as laid in Sarla Verma's case(Supra) and to make it applicable also to the self employed and persons on fixed wages, it is clarified that the increase in the case of those groups is not 30% always: It will also have a reference to the age. In other words, in the case of self-employed or persons with fixed wages , in case, the deceased victim was below 40 years , there must be an addition of 50% to the actual income of the deceased while computing future prospects. Needless to say that the actual income should be income after paying the tax, if any. Addition should be 30% in case the deceased was in the age group of 40 to 50 years."
The Supreme Court held that the rise in the cost of living affects everyone and that it does not make any distinction between the rich and the poor. The Supreme Court held that the effect of rise in prices directly impacts the cost of living is minimal on the rich and maximum on those who are self employed or who have fixed income, and that ,these people were the worst affected people. Therefore, additional income was necessary for sustaining their families. The Supreme Court accordingly held that it was just and equitable to provide an addition of 50% to the actual income of the deceased while computing future prospects.
In the light of the aforesaid we are of the opinion that under the category 'future prospects', 50% of the income namely Rs.1250/ per month should be increased.
For the reasons stated the aforesaid award of the Tribunal is modified in the following manner.
(a) Income Rs. 2,500/ per month @ Rs.125 per day for 20 days in a month.
(b) Yearly income Rs.2,500X12=Rs.30,000/
(c) 50% Deduction towards the personal and living expenses of deceased Rs.30,000-15,000=15,000/
(d) 50% Addition towards the future prospect 30,000x50/100=15,000
(e) Yearly Dependency Rs.15,000+15,000=30,000/
(f) Multiplier Applicable 18
(g) Loss of dependency 30,000x18=5,40,000/
(h) Loss of dependency assessed by the Tribunal Rs.1,50,000/
(i) Amount Enhanced Rs.5,40,000-1,50,000=3,90,000 along with 8% simple interest from the date of petition i.e. 12.4.2001 till the date of realisation.
In the light of the aforesaid, the award of the Tribunal is modified and the compensation from Rs.1,55000/ is enhanced to Rs.5,40,000/. The amount of Rs.5000/ awarded towards funeral expenses is maintained and does not require interference.
In the light of the aforesaid the appeal is allowed. The amount of compensation is enhanced to 5,45000/ alongwith interest @8% per annum to be calculated from the date of filing of the petition till the date of realisation. Any amount already received, shall be adjusted accordingly.
Order Date :- 5.5.2014/cps (Dinesh Gupta,J) (Tarun Agarwala,J.)