Gujarat High Court
United India Insurance Company Ltd. vs Rehanaben Salimbhai Mukindo on 7 August, 2018
Author: Akil Kureshi
Bench: Akil Kureshi, B.N. Karia
C/FA/2190/2017 JUDGMENT
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 2190 of 2017
With
R/CROSS OBJECTION NO. 68 of 2018
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE AKIL KURESHI
and
HONOURABLE MR.JUSTICE B.N. KARIA
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1 Whether Reporters of Local Papers may be allowed to
see the judgment ?
2 To be referred to the Reporter or not ?
3 Whether their Lordships wish to see the fair copy of the
judgment ?
4 Whether this case involves a substantial question of law
as to the interpretation of the Constitution of India or any
order made thereunder ?
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UNITED INDIA INSURANCE COMPANY LTD.
Versus
REHANABEN SALIMBHAI MUKINDO
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Appearance:
MR MAULIK J SHELAT(2500) for the PETITIONER(s) No. 1
ISHTIAQUE I MEV(9231) for the RESPONDENT(s) No. 6
JENIL M SHAH(7840) for the RESPONDENT(s) No. 1,2,3
MR IRSHADAHMAD B MEV(2551) for the RESPONDENT(s) No. 6
SHAILI A SHAH(8832) for the RESPONDENT(s) No. 4
UNSERVED EXPIRED (R)(69) for the RESPONDENT(s) No. 5
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CORAM: HONOURABLE MR.JUSTICE AKIL KURESHI
and
HONOURABLE MR.JUSTICE B.N. KARIA
Page 1 of 24
C/FA/2190/2017 JUDGMENT
Date : 06,07/08/2018
ORAL JUDGMENT
(PER : HONOURABLE MR.JUSTICE AKIL KURESHI)
1. The First Appeal and Cross Objections have been filed by the Insurance Company and the claimants respectively challenging the judgment and award dated 20.3.2017 passed by Motor Accident Claims Tribunal, Rajkot in MACP No.407/2005.
2. Briefly stated, facts are that one Salim Mohmadbhai aged about 40 years was travelling from Rajkot to Jamdevalia in Jamnagar district late at night on 27.2.2005 in his Maruti van. He was driving the van and was the only passenger in the vehicle. Just outside the city of Rajkot on Jamnagar road at about 2:10 am, his car collided with a luxury bus coming from the opposite direction causing serious damage to the vehicle and instantaneous death of the driver. Deceased Salim was employed as a Branch Manager in Rajkot Gramin Bank which was later on renamed as Saurashtra Gramin Bank. He had joined the service of the bank in the year 1988 as an officer and was promoted as a Branch Manager in the year 2003. His dependents i.e. his widow, minor children and aged father filed the said claim petition seeking compensation of Rs. 50 lacs from the driver, owner and insurer of the luxury bus involved in the accident. This claim was later on revised to Rs. 70 lacs. The Claims Tribunal held the driver of the luxury bus solely negligent in causing the accident and awarded a Page 2 of 24 C/FA/2190/2017 JUDGMENT total compensation of Rs.34,99,824/ to the claimants. In the process, the Tribunal assessed the income of the deceased at the time of accident at Rs.22,492/, granted 30% for future rise, deducted 1/3rd thereof for the personal expenditure of the deceased to arrive at the dependency benefits of Rs.19,492/ per month for the family. The Tribunal applied the multiplier of 14 to arrive at loss of dependency benefits at Rs.32,74.824/. To this the Tribunal added sum of Rs. 1 lac for loss of consortium, Rs. 1 lac for loss of love and affection for children and Rs.25,000/ for funeral expenses.
3. The advocate for the Insurance company raised the following contentions in support of the appeal :
1) The Tribunal erred in holding the driver of the luxury bus solely negligent in causing the accident.
2) The Tribunal did not deduct the incometax from the gross salary of the deceased to arrive at net take home pay.
3) The total award of Rs. 2.25 lacs under the conventional heads is not in tune with the judgment of Supreme Court in case of National Insurance Company Limited. v/s.
Pranay Sethi and ors reported in 2017(3) GLH 536.
4) Counsel submitted that the widow of the deceased was appointed on compassionate grounds by the bank in which the deceased himself was serving. The salary received by Page 3 of 24 C/FA/2190/2017 JUDGMENT the widow on account of such employment should have been atleast partially adjusted against the compensation assessed by the Claims Tribunal.
4. On the other hand, learned advocates Shri Jenil M. Shah and Ms. Shaili A. Shah appearing for the claimants opposed the appeal and requested for enhancement of compensation on the following grounds :
1) The Claims Tribunal committed no error in holding that the driver of the luxury bus was solely negligent in causing the accident.
2) The Tribunal erred in granting only 30% rise in income for future when there was reliable evidence suggesting that had deceased not met with the accident, his income would have increased manifold during his remaining service tenure.
3) There were four dependents including aged father.
Tribunal committed an error in deducting 1/3rd for the personal expenditure of the deceased instead of 1/4th of his prospective income.
4) The date of birth of the deceased was 16.4.1964. He was therefore, in the age group of 36 to 40. Multiplier of 15 as per the judgment of Supreme Court in case of Sarla Verma(Smt.) and others v. Delhi Transport Corporation and another reported in (2009) 6 Supreme Court Cases Page 4 of 24 C/FA/2190/2017 JUDGMENT 121, should have been applied instead of 14.
5. We would first address the question of negligence. As noted, the accident took place late at night. Deceased was driving his Maruti Van. He was going from Rajkot towards Jamnagar. It was a proper highway. The luxury bus was coming from the opposite direction. Neither the claimants nor the Insurance company has examined any eyewitness. Deceased being the sole passenger in the car, obviously claimants could not have produced any witness. The Insurance company failed to summon the driver of the luxury bus who could have been the best person to state before the Court the precise manner in which the accident had taken place. In absence of such evidence, we would have to fall back on other materials on record, also contemplating adverse inference against the driver for refusing to step in the witness box. Related evidence is in the nature of FIR lodged against the driver, as also the chargesheet which the police filed upon culmination of investigation. In addition to these factors, we would be taking note of the contents of the panchnama of the scene of the incident which was produced at exh.36. This panchnama provides information about several important aspects of the incident.
07.08.2018
6. The panchnama records that a Maruti van was lying on the road near the petrol pump. The front portion of the van was completely smashed. The windowshield, headlights, Page 5 of 24 C/FA/2190/2017 JUDGMENT door and the frontsheets of the vehicle were lying on the road. The engine was badly damaged. Vehicle had caught fire. All the four tyres were burnt. The panchnama further records that on the northen side of this site, there is one whitecoloured bus lying in the ditch on the side of the road. The bus was lying inside the dip which was on the road side. The headlights and bumper of the bus on the driver side were broken. The left hand side glass and headlight and even the tyre are separated. The front and left side of the sheets of the bus are broken.
7. This panchanama provides vital information. The accident was between a Maruti van and a luxury bus. The Maruti van was so badly damaged that not only its front portion but even engine was affected. Impact must have been so great that vehicle caught fire. The bus which is a much bigger, heavier and sturdier vehicle was badly damaged. The effect was not confined only to the driver side of the vehicle but the entire front portion was impacted. We have no doubt in our minds that the driver of the luxury bus must be driving the vehicle at a great speed. Had the driver being driving at a moderate speed and on his correct side of the road, the accident in question could simply not happen or at any rate could not have caused such extensive damage to both the vehicles. Ordinarily, if the bus had moved at an average speed, it would have stopped shortly after the accident even if the accident was otherwise inevitable. In the present case, luxury bus was found not at or near the point of impact but at a fair Page 6 of 24 C/FA/2190/2017 JUDGMENT distance away that too not on the road or on the shoulder of the road but in a ditch after the road width is over. The term used in the panchnama to describe this place is "Vakdoo" which is a local term used for a rivulet or a storm water drain. Clearly, the driver of the bus lost complete control over his vehicle and after the massive impact with Maruti van, he still could not stop the vehicle for a fair distance and the bus landed in a ditch. All these are indications of utter negligence on part of the driver of the luxury bus. Even otherwise, as being in control of heavier vehicle which is more difficult to manoeuvre and break speed off, it was his duty to drive the vehicle with greater care. We may recall the observations of the Supreme Court in case of N.K.V. Bros (P) Ltd. v. M. Karumai Ammal and others reported in (1980) 3 Supreme Court Cases 457 :
"3. Road accidents are one of the top killers in our country, specially when truck and bus drivers operate nocturnally. This proverbial recklessness often persuades the courts, as has been observed by us earlier in other cases, to draw an initial presumption in several cases based on the doctrine of res ipsa loquitur. Accidents Tribunals must take special care to see that innocent victims do not suffer and drivers and owners do not escape liability merely because of some doubt here or some obscurity there. Save in plain cases, culpability must be inferred from the circumstances where it is fairly reasonable. The court should not succumb to niceties, technicalities and mystic maybes. We are emphasising this aspect because we are often distressed by transport operators getting away with it thanks to judicial laxity, despite the fact that they do not exercise sufficient disciplinary control over the drivers in the matter of careful driving. The heavy economic 103 impact of culpable driving of public transport must bring owner and driver to their Page 7 of 24 C/FA/2190/2017 JUDGMENT responsibility to their 'neighbour'. Indeed, the State must seriously consider no fault liability by legislation. A second aspect which pains us is the inadequacy of the compensation or undue parsimony practised by tribunals. We must remember that judicial tribunals are State organs and Article 41 of the Constitution lays the jurisprudential foundation for state relief against accidental disablement of citizens. There is no justification for niggardliness in compensation. A third factor which is harrowing is the enormous delay in disposal of accident cases resulting in compensation, even if awarded, being postponed by several years. The States must appoint sufficient number of tribunals and the High Courts should insist upon quick disposals so that the trauma and tragedy already sustained may not be magnified by the injustice of delayed justice. Many States are unjustly indifferent in this regard."
8. The Tribunal therefore, correctly put the entire blame on the driver of the luxury bus in causing the accident.
9. We now come to the computation of loss of dependency benefits. On the basis of arguments advanced by the advocates on both the sides, we would have to assess the current income of the deceased after taking into account the income tax liability if any, besides what would be the correct rise in future income to be granted, consider whether deduction of personal expenditure should be 1/3rd or 1/4th as suggested and also select an appropriate multiplier. These issues we may consider one after another.
10. The claimants had examined one Atul Mehta at exh.28. He was the employee of the bank. He stated that the deceased was working as an officer. In February 2005, his gross salary was Rs.19740/ per month. Such pay was revised in September 2005 with retrospective effect from Page 8 of 24 C/FA/2190/2017 JUDGMENT November 2002. As per such pay revision in February 2005, pay of the deceased was fixed at Rs.22,492/. Arrears of pay were also paid to the family. He stated that even if deceased was not promoted, his pay would have been Rs.80,000/ per month in June 2016, had he not met with the accident. He produced certificate of pay of the deceased at exh.29 and certificate indicating the prospective pay upon the date of retirement. He also produced the pay fixation and computation of arrears of the deceased upon retrospective pay revision.
11. From such evidence it can be gathered that effectively on date of the accident pay of deceased was Rs.22,492/. Though his pay fixation happened after the accident, it was by virtue of retrospective pay revision. We would therefore, take this figure as income on the date of the accident.
12. This figure does not take into account the tax liability of the employee. The computation of revised pay fixation produced by the employee of the bank makes it clear that in February 2005, the deceased was drawing basic pay of Rs.18,800/, Dearness relief of Rs.2470/ and HRA of Rs.1222/, thereby receiving gross pay of Rs.22,492/. Clearly this does not have income tax element embedded in it. We would therefore, have to ascertain his tax liability to arrive at the net take home pay. Some element of estimation would be necessary. We have referred to the Incometax Ready Reckoner for the year under consideration and gathered that the income tax exemption Page 9 of 24 C/FA/2190/2017 JUDGMENT limit was Rs.50,000/. There was standard deduction of Rs.30,000/ to the salaried class. Deceased would have no tax liability for the initial income of Rs.80,000/. In addition to the basic exemptions, the employee could avail of other exemptions and deductions such as medical insurance premium and investment in PPF or similar specified schemes. We have taken into account the tax slabs prevailing at the relevant time. Gross salary was Rs.2,70,000/ (rounded off). After basic tax exemption limit, the standard deduction of salaried class and other exemptions, we estimate his tax liability at Rs.15,000/ per annum. His take home income therefore, would be Rs.2,55,000/ (Rs.2,70,000Rs.15,000).
13. As per the judgment of Supreme Court in case of Pranay Sethi and ors (supra), 30% rise in income would have to be applied. We may recall counsel for the claimants however pressed for further increase on the ground that there was reliable evidence showing that the income of the deceased would have been increased manifold, had he not met with the unfortunate accident. This contention however, cannot be accepted. This aspect was considered by this Court in a recent judgment in case of Shriram General Insurance Company Ltd. v. Shanabhai Govindbhai Tadvi dated 17.7.2018 in R/First Appeal No.2372/2014. In the said case, deceased was a constable in the State Police department. There was evidence of pay revisions and increase in salary of Government employees. In view of such factors in such Page 10 of 24 C/FA/2190/2017 JUDGMENT case also counsel for the claimants had pressed for greater increase for future rise in income. Such question was considered by the Court in the following manner :
"5. We would first consider the question of granting future rise of income. As is well known, the two Judge Bench of Supreme Court in case of Sarla Verma (Smt) and ors vs. Delhi Transport Corporation and anr reported in (2009) 6 SCC 121 attempted to standardize number of issues revolving around computation of compensation in accident cases, fatal as well as injury. These issues included the choice of multiplier, future rise in income and deduction for the personal expenditure of the deceased in case of death. Even after this judgement, the issues did not reach total uniformity. There were Supreme Court judgements either departing from or explaining and at times questioning the ratio of the judgement in case of Sarla Verma (Smt) and ors (supra). On a reference, the three Judge bench of the Supreme Court in case of Reshma Kumari and ors vs. Madan Mohan and anr reported in (2013) 9 SCC 62 substantially confirmed what was said in case of Sarla Verma (Smt) and ors (supra). The issues still refused to die down. On a further reference Constitution Bench in case of Pranay Shethi and ors(supra) once again took up all such contentious issues and substantially confirmed the directives in case of Sarla Verma (Smt) and ors (supra) however, making minor modifications. The conclusions of the Constitution Bench were as under:
"61. In view of the aforesaid analysis, we proceed to record our conclusions:
(i) The twoJudge 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 Page 11 of 24 C/FA/2190/2017 JUDGMENT 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 selfemployed 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 hereinbefore.
(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."
6. By virtue of this judgement thus, the question of granting increase for future rise in income has been substantially standardized. One set of cases envisaged are where the deceased had a permanent job (contrary to what is often projected as permanent job is not synonymus with a Government job) and the other set of cases would be Page 12 of 24 C/FA/2190/2017 JUDGMENT where the deceased is self employed or is on a fixed salary. Depending on which group the deceased belongs and his age, the future rise in income is prescribed. As laid down by the Supreme Court it becomes the law of the land. The Courts would therefore be expected to follow this trend.
7. We are conscious that in later judgements, two Judge Benches of the Supreme Court have made a minor departure. First in point of time is case of Hem Raj (supra), where the Supreme Court upheld the contention that if the evidence on record so warrants, rise in income, over and above what was suggested in case of Pranay Shethi and ors(supra), can be granted. The later in point of time was in case of Sureshchandra Bagmal Doshi and anr (supra) where the Supreme Court, noticed that the deceased was 25 years of age at the time of accident. He was working as a Sales Engineer in a private company. The Supreme Court approved the decision of the Tribunal granting 100% rise in salary for future.
8. From the above, it can be seen that the rise in income for future increase as provided by the Supreme Court in case of Pranay Shethi and ors(supra) has to be a norm, granting further increase an exception. In exceptional cases, where it is shown that the deceased was a young person, had exceptional academic qualification, had shown early potential of higher earning or where the last few years of income of the deceased shows a trend or steep rise, the departure may be permitted. However, merely showing the projected salary of a Government servant over a long period of time, showing steady rise with passage, would not be one such exceptional circumstance. As is well known, the salary structure of permanent Government employees is well defined. Two principal sources of rise in income are, periodic increments and rise in Dearness Allowance. Whereas Dearness Allowance takes care of the inflation ensuring that the pay package of the employee keeps pace with the rising prices, yearly increments are more in the nature of reward for long service and a recognition that with passage of time and seniority, the contribution of the employee would be higher. The claimants cannot produce projected salary over number of years after accidental death of the Government servant to argue that being an exceptional case the rise in income for future should be in Page 13 of 24 C/FA/2190/2017 JUDGMENT deviation to judgement of Supreme Court in case of Pranay Shethi and ors(supra). In the conclusion, we adhere to prescription of 30% rise in income looking to the age of the deceased."
14. Granting 30% rise in future income would bring the prospective income to Rs.3,31,500/ (Rs.2,55,000+ Rs.76,500). The claimants were widow, two minor children and aged father who is currently stated to be about 90 years. Deceased had therefore, left behind four dependents. As per the judgment of Supreme Court in case of Sarla Verma(Smt.) and others (supra), deduction for personal expenditure would be 1/4th of his net income which comes to Rs82,875/. Loss of dependency benefits for the family would therefore, work out to be Rs.2,48,625/ per annum (Rs.3,31,500Rs82875). Deceased was born on 16.4.1964. On the date of the accident, he had not yet completed 41 years. As per the judgment of Supreme Court in case of Sarla Verma(Smt.) and others(supra), multiplier of 15 would be applied. The loss of dependency benefits would therefore, work out to be Rs.37,29,375/(Rs.2,48,625x15). The Tribunal has awarded total of Rs. 2.25 lacs under the conventional heads which is not in tune with the judgment of Supreme Court in case of Pranay Sethi and ors (supra) which would have to be brought down to Rs. 70,000/. The total compensation payable to the claimants would therefore be as under :
Page 14 of 24 C/FA/2190/2017 JUDGMENT
Loss of dependency benefits Rs.37,29,375/
Conventional heads Rs.70,000/
Total compensation Rs.37,99,375/
15. The Tribunal has granted Rs.34,99,824/ to the claimants. The claimants shall therefore, be entitled to receive additional compensation of Rs. 2,99,551/ (Rs.37,99,375Rs.34,99,824) from the Insurance company with simple interest at the rate of 8% per annum from the date of claim petition till actual deposit.
16. This leaves the last question of adjustment of salary earned by the widow of the deceased who was employed by the bank in which the deceased was working. Counsel for the Insurance company, we may recall, argued that widow was employed on compassionate basis and therefore, at least part of the salary paid by the bank to her should be adjusted against the compensation payable to the claimants. He had placed heavy reliance on judgment of Supreme Court in case of United India Insurance Co. Ltd. and others v. Patricia Jean Mahajan and others reported in (2002) 6 Supreme Court Cases 281 and in case of Bhakra Beas Management Board v. Kanta Aggarwal (Smt) and others reported in (2008) 11 Supreme Court Cases 366.
Page 15 of 24C/FA/2190/2017 JUDGMENT
17. On the other hand, learned counsel for the claimants placed reliance on a Division Bench judgment of this Court in case of Heirs of deceased Girdharbhai @ Girishbhai Devjibhai, Rekha & ors. v. Rakeshbhai Gopalbhai Khanpara & ors. reported in 2012 (2) GLH 246 and judgment of Supreme Court in case of Vimal Kanwar & ors. v. Kishore Dan and others reported in 2013(6) Scale
705.
18. Before adverting to decisions of various Courts, we may first record that it is not in dispute that after the death of the deceased, widow was employed by the bank. This has been so stated by her, in her cross examination at exh.21. However, it is not clear whether she was given such employment on compassionate grounds. It is not clear whether the bank had a scheme for compassionate appointment or whether by way of one time compassionate act, the widow of the deceased employee was given such benefit. If the widow was appointed in regular course of events, the arguments of the Insurance company would simply not be worth considering any further. We however, proceed on the basis that widow was employed on compassionate basis whether under a formal scheme or otherwise. In our opinion, even if that were so, the salary earned by the widow cannot be adjusted against the compensation payable to the family of the deceased. Principally, the salary is being paid to the widow for the work done by her as a bank employee, the mode of employment or source of securing such employment Page 16 of 24 C/FA/2190/2017 JUDGMENT notwithstanding. As a person appointed on compassionate ground as per the scheme of the employer organisation, he or she merely gets a preferential appointment. In other words, he or she does not have to compete with other eligible candidates for selection but is appointed so that family of the deceased does not turn to destitution due to sudden unfortunate turn of events. Such compassionate appointment would be available whether the death occurs due to any unfortunate incident or for any other reason as long as the employee dies while in harness. Even otherwise, it would be wholly inequitable to allow a tortfeasor to claim the benefits of a benevolent act of someone else. Let us take an example. If the coworker of the deceased where he was working, collects money to donate to the family with a good intention of financially helping the family and in his time of distress, can the Insurance company claim set off, of such amount against its liability to compensate the dependents of the deceased? Answer obviously is in the negative. It would be more so in case of salary of widow of deceased. She gets paid for the work done by her. Such payment is neither a bounty nor a largess nor a donation.
19. Judgment of Supreme Court in case of Patricia Jean Mahajan and others (supra) though discussed general principles for adjustment of benefits received by the claimants due to death of deceased, was not concerned with this specific question. In case of Bhakra Beas Management Board (supra), the Supreme Court did make Page 17 of 24 C/FA/2190/2017 JUDGMENT some observations which would support the case of the Insurance company. It was a case where the deceased was travelling in a jeep which was owned by appellant Bhakra Beas Management Board and driven by the driver employed by the Board. It was held that driver of the jeep was solely negligent in causing the accident which resulted in the death giving rise to the claim. The Claims Tribunal and the High Court computed and awarded compensation which would be the liability of the Board to satisfy. Supreme Court noticed that immediately after the death of deceased, his wife was given compassionate appointment by the employer and residence was also provided to her. It was in this background Supreme Court slashed down computation to some extent giving adjustment for the benefits given by the Board to the family of the deceased. Thus the benefits were offered by the Board, which itself was otherwise liable to pay the compensation. This judgment cannot be seen as one laying down the proposition that the salary received by the dependent of the deceased who is given compassionate appointment should be adjusted towards compensation payable to the claimants. This judgment was cited before the Division Bench of this Court in case of Heirs of deceased Girdharbhai (supra). The Court after noticing several judgments of Supreme Court and other High Courts on the point observed as under :
"14.Three different situations thus emerge. First would be a case where the employer of the deceased has nothing to do with his accidental death. His widow or any other Page 18 of 24 C/FA/2190/2017 JUDGMENT dependant is granted appointment on compassionate basis in terms of "dying in harness" scheme. Courts upon courts have held that the wrong doers who caused death by his wrongful act cannot benefit out of such benevolent act of the employer. Our case falls in this first category. Second category of the case would be where the employer of the deceased is also vicariously liable to pay compensation to the dependants of the deceased. Even in such a case, if the employer has granted appointment to his widow on compassionate grounds in terms of a scheme, no adjustment for the salary of the widow was held permissible mainly on the ground that widow would have received such appointment irrespective of the nature of death i.e. accidental or otherwise. Two cases decided by this Court in case of Arunaben and others v. Mehmoodbhai Imamali Kaji and others (supra) and O.N.G.C., Mehsana Project v. Vinakapur @ Vinodkumari and others(supra) fall in this category. In both these cases, the employer tried to avoid liability to pay compensation for the tortuous act by pointing out that the widow of the deceased was given appointment on compassionate grounds. High Court in both cases rejected such a contention and refused adjustment of the salary of the wife against the compensation payable for the death of the husband on the grounds that the wife would have received such appointment in case of death due to any reason and that the salary earned by the wife was for rendering service. Particularly, in case of Arunaben and others v. Mehmoodbhai Imamali Kaji and others (supra), the Court noted that the appointment of the wife was made as per the scheme framed by the employer of the husband and not as a tradeoff for payment of compensation. The third category of the cases may be where the person causing the accident or the employer of such a person vicariously liable to pay compensation for the tortuous act of the employee, offers employment to the widow or any dependant of the deceased not under any scheme for compassionate appointment but to reduce or avoid such liability. In such a situation the employer of the widow/dependant would contend that necessary adjustment in the compensation payable to the dependants of the deceased should be made. Case before the Supreme Court in Bhakra Beas Management Board (supra) seems to fall in this category. Even the decision in case of Bhakra Beas Management Board (supra) does not Page 19 of 24 C/FA/2190/2017 JUDGMENT lay down a ratio that all benefits received by the dependants of the deceased through such compassionate appointment should be deducted from the compensation computed and found payable to the claimants.
15.Decision in case of Bhakra Beas Management Board (supra) therefore, must be viewed in light of special facts in which same was rendered. It was a case wherein apparently the defendant was the employer. The employee died in a vehicular accident. It appears that he was travelling in the Jeep owned by the employer. The driver of the Jeep was held negligent in causing the accident. The employer had immediately upon death offered appointment on compassionate grounds to the widow of the deceased.
The employer had also provided residential accommodation to her. It was in this background that the Apex Court was of the opinion that the High Court ought to have taken into account such benefits granted to the widow. While saying so in our humble opinion the Apex Court neither laid down a ratio that in all cases where upon death of a person in a vehicular accident widow or any other family member is appointed on compassionate grounds, all benefits of salary flowing from such appointment must be deducted from the compensation payable to the dependants of the deceased particularly when the employer granting compensation appointment and the defendant who is liable to pay compensation are two different persons. Defendant who has to compensate the dependants of the deceased for the wrong done cannot gain any benefit out of the benevolent act of the employer of the deceased. It is often said, judgment of a Court should not be read as a Euclid's theorem. Ratio of a decision must be understood in the background of the case in which the decision has been rendered.
17.We also find that in case of Bhakra Beas Management Board (supra), the Apex Court did not disturb the basic ratio laid down in case of Helen C. Rebello (supra) wherein it was held that the amount to be deducted would not include that which the claimant receives on account of other forms of deaths, which he would have received even apart from accidental death. It is well known that the scheme for compassionate appointment is available in case of the person dying in harness whether due to accident, Page 20 of 24 C/FA/2190/2017 JUDGMENT naturally or any other cause. Therefore, benefit of compassionate appointment flowing to a family member of the deceased servant cannot be stated to be one which would be available only upon accidental death. Further the Apex Court in case of Helen C. Rebello (supra) held that amount of loss and gain of one contract cannot be made applicable to loss and gain of another contract and similarly the amount receivable under statute would have no corelation to amount earned by an individual. Subsequent decision in case of Bhakra Beas Management Board (supra) must be seen in light of the fact that defendant paying the compensation for accidental death to the claimants was the same as one who apparently offered employment to his wife on compassionate basis immediately after such death and also provided accommodation for residence. This is the only way in which we are able to reconcile the ratio of the Apex Court laid down in case of Helen C. Rebello (supra) and observations made in case of Bhakra Beas Management Board (supra). In the present case husband died in an accident, sole responsibility of which was fasten on the driver of the Matador who was held grossly negligent in causing such accident. Husband's employer Gujarat Electricity Board had after sometime in tune with the scheme of the compassionate appointment granted employment to his wife, since employee had died in harness. Looked from any angle, the driver or owner of the Matador cannot seek any benefit out of such employment granted by the Gujarat Electricity Board on compassionate grounds to the wife of the deceased."
20. Subsequently, the Supreme Court in case of Vimal Kanwar & ors. observed as under :
"20. The second issue is "whether the salary receivable by the claimant on compassionate appointment comes within the periphery of the Motor Vehicles Act to be termed as "Pecuniary Advantage" liable for deduction."
"Compassionate appointment" can be one of the conditions of service of an employee, if a scheme to that effect is framed by the employer. In case, the employee dies in Page 21 of 24 C/FA/2190/2017 JUDGMENT harness i.e. while in service leaving behind the dependents, one of the dependents may request for compassionate appointment to maintain the family of the deceased employee dies in harness. This cannot be stated to be an advantage receivable by the heirs on account of one's death and have no correlation with the amount receivable under a statute occasioned on account of accidental death. Compassionate appointment may have nexus with the death of an employee while in service but it is not necessary that it should have a correlation with the accidental death. An employee dies in harness even in normal course, due to illness and to maintain the family of the deceased one of the dependents may be entitled for compassionate appointment but that cannot be termed as "Pecuniary Advantage" that comes under the periphery of Motor Vehicles Act and any amount received on such appointment is not liable for deduction for determination of compensation under the Motor Vehicles Act."
21. In this judgment however decision in case of Bhakra Beas Management Board (supra), was not noticed. Be that as it may, subsequent three Judge Bench judgment in case of Reliance General Insurance Company Limited v. Shashi Sharma and others reported in (2016) 9 Supreme Court Cases 627 has concluded this issue. It was a case in which on a reference, three Judge Bench of Supreme Court considered the ratio laid down in case of Helen C. Rebello v. Maharashtra SRTC reported in (1999) 1 SCC 90 concerning the question of permissibility of deduction of amount receivable by the dependents of the deceased towards Life Insurance policy from the amount of compensation payable under the Motor Vehicles Act. The Insurance companies had relied heavily on decision of Supreme Court in case of Bhakra Beas Management Board (supra). Supreme Court affirmed the ratio of the Page 22 of 24 C/FA/2190/2017 JUDGMENT decision in case of Helen C. Rebello (supra). Decision in case of Bhakra Beas Management Board (supra) was distinguished observing that to do complete justice between the parties and for bringing quietus to the long pending litigation, the Court passed an order for full and final settlement of all the claims interparties. It was observed that :
"Thus understood, Bhakra Beas case is not an authority of having taken a contra view than the view expressed in Helen C. Rebello and Patricia's case. As a matter of fact, in para 11 of the reported decision in Bhakra Beas, paragraphs 32 to 34 of Helen C. Rebello's case have been reproduced in their entirety. No observation is found in the entire decision, to have doubted the correctness of the dictum in Helen C. Rebello and Patricia's case."
22. It was concluded that adjustment of compensation can be made only to the extent of amount receivable by the dependents of the deceased Government employee in terms of relevant rules providing financial assistance equivalent to the loss of pay and wages of the deceased employee for the period specified. It was held that other benefits extended to the dependents of the deceased employee such as family pension, life insurance, PF etc. remain unaffected and cannot be allowed to be deducted which in any way would be paid to the dependents of the deceased Government employee applying the principles expounded in Helen C. Rebello and Patricia Jean Mahajan's case.
23. In the result, appeal of the Insurance company is dismissed.
Page 23 of 24C/FA/2190/2017 JUDGMENT
24. Cross Appeal of the claimants is allowed. Claimants shall receive additional compensation of Rs. 2,99,551/ from the Insurance company with simple interest at the rate of 8% per annum from the date of claim petition till actual deposit in the same proportion as provided by the Claims Tribunal in the impugned award. The amount payable to the father of the deceased shall be released forthwith without any further investment. From the amount payable to rest of the claimants, 50% may be released in favour of the claimants after due verification and remaining 50% shall be invested in any nationalised bank for a period of three years and shall be released upon maturity. During such period, the claimants shall receive periodical interest accrued thereon. Cross Objections stand disposed of accordingly.
R&P may be transmitted back to the concerned trial Court.
(AKIL KURESHI, J) (B.N. KARIA, J) Raghu Page 24 of 24