Himachal Pradesh High Court
Reliance General Insurance Company ... vs Smt. Jai Devi & Others on 11 April, 2023
Author: Sandeep Sharma
Bench: Sandeep Sharma
IN THE HIGH COURT OF HIMACHAL PRADESH AT SHIMLA
FAO No.122 of 2020 a/w
.
FAO No.143 of 2020
Judgment Reserved on : 21.03.2023
Date of Decision: 11 04.2023
1.FAO No.122 of 2020
Reliance General Insurance Company Limited ...Appellant
Versus
Smt. Jai Devi & Others ...Respondents
2.FAO No.143 of 2020
Sh. Vijay Thakur ...Appellant
Versus
Reliance General Insurance Company Limited & Ors.
...Respondents.
Coram:
The Hon'ble Mr. Justice Sandeep Sharma, Judge.
Whether approved for reporting?1 Yes.
For the Appellant(s): Mr. Jagdish Thakur, Advocate, for
the appellant in FAO No.122 of
2020.
Mr. Arvind Sharma, Advocate, for
the appellant in FAO No.143 of
2020.
For the Respondent(s): Mr. H.R.Jhingta, Advocate for
respondent Nos. 1 to 3 in FAO
No.122 of 2020 and for respondent
Nos. 2 to 4 in FAO No.143 of 2020.
1
Whether reporters of the local papers may be allowed to see the judgment?
::: Downloaded on - 17/04/2023 20:32:41 :::CIS
2
Mr. Jagdish Thakur, Advocate, for
respondent No.1 in FAO No.143 of
2020.
.
Mr. Arvind Sharma, Advocate, for
respondent No.4 in FAO No.122 of
2020.
Sandeep Sharma, J.
Since both the above captioned appeals filed under Section 173 of the Motor Vehicles Act (for short 'Act'), lay challenge to award dated 18.02.2020, passed by learned Motor Accident Claims Tribunal (IV) Shimla, District Shimla, H.P., in M.A.C.C. No.12R/2 of 2014, titled as Smt. Jai Devi and others vs. Vijay Thakur and another, same were clubbed together and are now being disposed of by this common judgment. However, for the sake of clarity, facts of FAO No. 122 of 2020 are being discussed herein below and parties shall be referred to as per their status in the same.
2. Briefly stated facts of the case, as emerge from the record are that respondents Nos. 1 to 3/claimants (hereinafter, 'claimants') namely, Smt. Jai Devi(widow of deceased) Sh.
Balwan Singh and Sh. Harish Kumar(sons of deceased), instituted proceedings under Section 166 of the Motor Vehicles Act, seeking therein compensation to the tune of Rs.50,00,000/ on account of death of Sh. Mathu Ram, who died in motor accident happened on 13.02.2014 near Hateshwari Petrol Pump, Samala Road, Rohru on ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 3 account of rash and negligent driving of respondent No.4, driver cumowner of the offending vehicle. Above named claimants while .
seeking compensation claimed before Tribunal below that at the time of death, late Sh. Mathu Ram was working as Assistant Manager in the State Cooperative Bank and in this capacity, he was getting monthly salary of Rs.62000/ per month but after his death, entire family, which comprises of claimants, as named hereinabove, is at the verge of starvation. Claimants specifically stated before Tribunal below that deceased Mathu Ram died on account of rash and negligent driving of Vijay Kumar respondent No.4 (appellant in FAO No.143 of 2022).
3. Aforesaid claim put forth by the claimants came to be resisted and contested by respondent No.4, Vijay Kumar on the ground that deceased Mathu Ram did not die on account of the injuries but on account of heart attack. Respondent No.4 further pleaded that since at the time of accident his vehicle was duly insured with the appellantinsurance company, liability, if any, to pay compensation to the claimants is of the insurance company.
4. AppellantInsurance Company by way filing separate reply refuted the claim of the claimants on the ground that the vehicle was being driven by respondent No.4, Vijay Kumar in violation of terms and conditions of the insurance policy. Appellant insurance company claimed that at the time of the accident, ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 4 respondent No.4 was not having a valid and effective driving license and as such, it cannot be held liable to indemnify the .
insured. While denying factum with regard to accident for want of knowledge, Insurance Company claimed that the claimants have exaggerated the compensation.
5. On the basis of aforesaid pleadings adduced on record by the respective parties, Tribunal below vide order dated 10.03.2016 framed following issues:
1. Whether the deceased Sh. Mathu Ram died in Motor vehicle accident on account of rash and r negligent driving of motorcycle bearing No.HP10A 5429 on 13.02.2014, near Hateshwari Petrol Pump, Rohru, H.P. as alleged? OPP.
2. Whether the petitioners are entitled for compensation, if so, then what should be the quantum? OPP.
3. Whether the petition is not maintainable in the present form? OPR.
4. Whether the motorcycle was being driven in contravention of salient provisions of M.V.Act? OPR.
5. Whether the motorcycle was being driven in violation of terms and conditions of the insurance policy? OPR.
6. Whether the petitioners have no cause of action? OPR.
7. Relief:
6. Subsequently, on the basis of the evidence led on record by the respective parties, learned Tribunal below though ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 5 held respondent Vijay Thakur (appellant in FAO No.143 of 2020) liable to pay compensation to the tune of Rs.58,95, 820/ alongwith .
interest at the rate of 9% per annum from the date of filing of petition till payment to the claimants, but directed appellant Insurance Company to pay the amount at first instance and thereafter recover the same from respondent Vijay Kumar. In the aforesaid background, appellantInsurance Company has approached this Court by way of appeal bearing FAO No.122 of 2020. Since Tribunal below while holding respondent Vijay Kumar (appellant in FAO No.143 of 2020) liable to pay compensation, reserved liberty to the appellant Insurance Company to recover the money from the respondent Vijay Kumar, he has also approached this Court by way of appeal bearing FAO No.143 of 2020.
7. Primarily, appellantInsurance Company has laid challenge to the award impugned in the instant proceedings on the following grounds:
(i). Since the vehicle in question was being driven without there being any valid and effective driving licence, there was no occasion for the tribunal below to order pay and recover.
(ii). Tribunal below erred in not deducting the income tax while computing the annual income of the deceased for the purpose of assessing compensation.
::: Downloaded on - 17/04/2023 20:32:41 :::CIS 6(iii). Since there were three dependants in total, tribunal below ought to have deducted 1/3rd towards personal expenses.
.
(iv). Interest at the rate of 9% is on the higher side.
8. Respondent No.4, Vijay Kumar (appellant in FAO No.143 of 2020) has approached this Court on the ground that tribunal below has erred in recording the finding that vehicle in question was being driven by respondent No.4, Vijay Thakur without there being any valid and effective driving license. Since, respondent Vijay Thakur was having effective and valid driving licence, there was no occasion, if any, for Tribunal below to order pay and recover, rather liability should have been fastened upon the appellantInsurance Company.
9. Having taken note of the grounds taken by both the parties, this Court at first instance deems it fit to deal with sole ground raised by respondent Vijay Thakur in FAO No.143 of 2020 qua validity of driving license.
10. Mr. Jagdish Thakur, learned counsel representing the appellantInsurance Company, vehemently argued that respondent No.4, Vijay Thakur (appellant in FAO No.143 of 2020) was not having a valid and effective driving licence, as is evident from the response given by the authorities to the verification as well as ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 7 interrogatories sent by learned tribunal below. He argued that Tribunal below itself sent interrogatories to the DTO/RTO of the .
area concerned, who categorically reported that driving license was found fake and as such, there was no occasion, if any, for the court below to order pay and recover. He further submitted that since owner himself was driving the vehicle in question as such, there was no requirement for the insurance company to prove breach on the part of the owner. He further submitted that had the owner and driver been different persons, Tribunal below would have been justified in ordering pay and recover, but when driver himself happened to be owner of the motorcycle in question and it stood proved on record that he was not having valid driving license, there was no occasion, if any, for the court below to order pay and recover.
11. To the contrary, Mr. Arvind Sharma, learned counsel representing respondent No.4, Vijay Thakur (appellant in FAO No.143 of 2020), vehemently argued that Tribunal below misappreciated and misinterpreted the facts as well as evidence led on record, perusal whereof clearly reveals that on the date of the accident, respondent Vijay Thakur, who happened to be owner and driver of the illfated motorcycle was having effective driving license. He submitted that tribunal below wrongly ignored Ex.RW1/D i.e. information in respect of driving license of ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 8 respondent Vijay Thakur supplied under Right to Information Act.
He submitted that Tribunal below wrongly placed reliance upon Ex.
.
RW2/1C, which is photocopy of some document, original or certified copy whereof, was never produced before the learned tribunal below. He submitted that since no witness ever came to be summoned from the authority, who had authored Ex. RW2/1C, there was no question, if any, for Tribunal below to place reliance upon the same. He submitted that otherwise also, bare of perusal of Ex. RW2/1C clearly reveals that appellant Vijay Thakur was not party to the proceedings and at no stage was associated with the proceedings.
12. Having heard learned counsel representing the parties and perused the material available on record visàvis finding returned by learned tribunal below qua issue of driving license, this Court finds that appellantInsurance company with a view to prove that respondent No.4, Vijay Thakur was not having valid and effective driving license, examined Sh. Narinder Kumar, Manager as RW2, who deposed that he has been working in the Reliance General Insurance since 2014. While tendering authority letter Ex.RW2/A, he also tendered copy of insurance Ex. RW2/B. He deposed that after verification, it has been found that respondent No.4, Vijay Thakur was not having valid and effective driving license. He deposed that he applied under Right to Information Act ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 9 for verification of the driving license of respondent No.4, Vijay Thakur, but since incomplete information was supplied, appeal was .
filed under Right to Information Act, copy whereof is Ex.RW2/1B, wherein it has been specifically reported that respondent Vijay Thakur was not having valid and effective driving license and license produced by respondent Vijay Thakur was never issued by R &LA, Nagaland. However, in his crossexamination, he admitted that in the appeal filed under Right to Information Act, respondent Vijay Thakur was not made party. He categorically denied the suggestion put to him that no correspondence was ever made with regard to license of the respondent Vijay with R&LA, Nagaland.
13. It is quite apparent from the aforesaid case setup by the appellantInsurance company as well as other documentary evidence led on record that learned Tribunal below with a view to ascertain genuineness and correctness of the Driving license Ex.RW1/C placed on record by respondent Vijay Thakur sent interrogatories to District and Sessions Judge, Zunheboto District Transport Officer, Nagaland and District Transport Authority, Nagaland. Aforesaid authorities sent reply of interrogatories to the Tribunal below directly on 12.12.2019 and 17.07.2019, thereby informing that license No.6075/NTVZ/2011 is not genuine. Having taken note of aforesaid information sent by the authorities, as detailed hereinabove, learned Tribunal below proceeded to ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 10 conclude that respondent Vijay was not having valid and genuine driving license. After having recorded aforesaid finding, court below .
while placing reliance upon the judgment rendered by Hon'ble Apex Court in National Insurance Company Limited versus Swaran Singh and others, (2004)3 SCC 297, proceeded to order pay and recover.
14. Mr. Jagdish Thakur, learned counsel representing the appellantInsurance company vehemently argued that once District and Sessions Judge, Zunheboto District Transport Officer, Nagaland and District Transport Authority, Nagaland had categorically apprised learned Tribunal below that Driving license of respondent Vijay Thakur was not genuine, learned Tribunal below ought not have ordered pay and recover, rather in that eventuality, direction ought to have been issued to respondent Vijay to pay the amount of compensation to the claimants directly at first instance.
15. At this stage, Mr. Arvind Sharma, learned counsel representing respondent Vijay invited attention of this Court to Ex.
RW1/C i.e. driving license of respondent Vijay Thakur, to state that though number of driving license of respondent Vijay Thakur is/was 6075/NTV/Z/2011 but information with regard to genuineness and correctness of aforesaid licenses was obtained from the Office of District Transport Officer, Zunheboto, Nagaland under Right to ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 11 Information Act. Public Information Officer office of District Transport officer Zunheboto, Nagaland vide communication dated .
10.07.2014, categorically stated that aforesaid licence after verification has been found to be genuine (EX. RW1/D). He also invited attention of this Court to copy of appeal, having been filed by the appellantInsurance company to Second Appellate Authority O/o State Information Commission, Nagaland Ex.RW2/1C, to state that information sought for through aforesaid application was qua Driving license No.6075/NTVZ/2011, issued by Zunheboto Licensing Authority, whereas Driving license of the respondent bears No.6075/NTV/Z/2011. He further submitted that since information furnished vide Ex. RW2/1C was not qua Driving license bearing No.6075/NTVZ/2011, same could not have been taken into consideration by the learned Tribunal below, while returning finding qua the legality and genuineness of the Driving license of respondent Vijay Thakur.
16. Having heard learned counsel for the parties and perused the material available on record, this Court finds that firstly Public Information Officer, District Transport Officer, Zunheboto, Nagaland vide communication dated 10.07.2014 Ex.RW1/D, furnished information under Right to Information Act to Sh. Baldev Deshta, Advocate, Court complex Rohru, District Shimla, H.P., that Driving license No.6075/NTV/Z/2011 has been found to be genuine ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 12 as per the office record, but subsequently officer of Nagaland Service Commission, while dealing with the appeal having been .
filed by the appellantInsurance company apprised the Court that Driving license No.6075/NTVZ/2011 was not issued from the office of DTO or the office of R &LA, Nagaland i.e. Ex. RW2/1C. No doubt, vide aforesaid order dated 26th September, 2016 i.e. Ex.
RW2/1C it was observed that Driving license No.6075/NTVZ/2011 was not issued from the office of DTO, Zunheboto, but no official of said office was examined to prove the communication issued by it and as such, it is not established in law that the driving license of respondent Vijay Thakur was fake.
17. In view of aforesaid facts and discussion, there appears to be merit in the contention of Sh. Arvind Sharma, learned counsel for the respondent Vijay that respondent Vijay was having valid and effective driving license on the date of accident and as such, there was no occasion, if any, for the court below to order pay and recovery, rather in that eventuality, appellant Insurance company ought to have been saddled with the liability to pay the compensation, if any. In view of the above, FAO No.143 of 2020 deserves to be allowed to the extent direction has been issued to the insurance company to recover the amount of compensation from the respondent Vijay Thakur.
::: Downloaded on - 17/04/2023 20:32:41 :::CIS 1318. The observation of the learned Tribunal below to the effect that the driving licence of respondent No.4 has been found to .
be not valid appears to be wrong. Communication dated 10.7.2014 issued by the Public Information Officer, office of District Transport Officer, Ext. RW1/D shows that Driving Licence No. 6075/NTV/Z/2011 issued in the name of Vijay Thakur has been found to be genuine as per their office record. So far communication dated 30.10.2015 issued by the same authority to Shri Narinder Kumar is concerned, it only speaks that the Driving Licence No. 6075NTVZ2011 has not been converted into smart card on Sarathi application and as per Notification dated 12.1.2015 issued by the Transport Commissioner, Motor Vehicles Department, Government of Nagaland, all the Driving Licences issued in manual form are to be converted into smart card on or before 1.12.2014, lest they shall be considered cancelled.
19. In the case at hand, the accident occurred on 13.2.2014 and the date for conversion of manual Driving Licences to smart card was fixed as 1.12.2014, as such, when the accident took place, the Driving Licence of respondent No.4 could not be said to be ineffective or invalid, more so, when no such direct evidence has come on record that such Driving Licence is /was fake and further no witness from the office of District Transport Officer Zunheboto, Nagaland was examined to prove the aforesaid ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 14 communication, as such, finding of learned Tribunal below to the effect that the Driving Licence of respondent No.4 was not valid .
and effective on the date of accident, is contrary to record, therefore, deserves to be set aside.
20. Since, it stands established on record that on the date of accident respondent Vijay was having a valid and effective driving license and vehicle involved in the accident was insured with the Insurance Company, appellant Insurance Company ought to have been fastened with liability to pay compensation instead of respondent Vijay Thakur.
Point Nos.2 to 421. Similarly, having perused the certificate issued by employer of the deceased i.e. HP Cooperative Bank Limited Ex.PW4/B, this Court finds that total monthly salary of deceased was Rs.51,171/ including component of income tax of Rs. 1030/.
Since component of income tax was to be deducted from the total salary, there appears to be merit in the contention of Mr. Jagdish Thakur, learned counsel representing the appellantInsurance company that annual income of the deceased assessed on the basis of monthly salary, is required to be recalculated, and sum of Rs.1030/ is required to be deducted from Rs. 51,171/ while ascertaining monthly income of the deceased. The total monthly ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 15 income of the deceased after deducting Rs.1030/ comes to Rs.50141/.
.
22. Since deceased was 52 years old at the time of his death and he was not suffering from any permanent disability,15% addition is required to be made to the established income and after making addition of 15% i.e. 50,141x15% =7,522, the total loss of dependency would be Rs.57,663/-
23. In view of law laid down by Hon'ble Apex Court in Sarla Verma (Smt) and others versus Delhi Transport Corporation and another, reported in (2009)6 Supreme Court Cases 121, where the dependants are more than three, there should have been deduction of 1/4th from the income of the deceased for his personal expenses. In the case at hand, petitioners are three in number because name of Smt. Shangri Devi i.e. widow of late Sh. Banu Ram, mother of the deceased, was deleted vide order dated 7.12.2016, there appears to be merit in the contention of learned counsel for the appellantinsurance company that 1/3rd deduction is required to be made, while assessing loss of dependency and thus, the monthly loss of dependency would be Rs.57,66357663x1/3 = 19211 and thus the same would come to Rs.57,66319,211= 38,452.
24. Since, there is no dispute that at the time of the accident the age of deceased was 52 years, Court below had ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 16 rightly applied multiple of '11'' in terms of the judgment passed by Hon'ble Apex Court in Sarla Verma's case(supra). The total loss .
dependency comes to Rs. 38,452x11x12=Rs.50,75,664/
25. Mr. Jagdish Thakur, learned counsel representing the appellantinsurance company argued that Tribunal below while accepting the age of the deceased 52 years, has wrongly applied multiplier of '11'. He argued that in the case at hand, deceased was 52 years on the date of the accident, the period of his remaining service would be six years and as such, multiplier falls within the date of retirement and in such a situation, split multiplier has to be applied i.e. for the salary drawn deducting income tax and professional tax, it has to be multiplied with '8' and remaining '3' has to be taken for the pensionary monthly amount, which the deceased ought to have received. In support of his aforesaid contention, he invited attention of this Court to the judgment rendered by High Court of Karnataka(Dharwad Bench) in case titled Nirmala and others versus Asgar Pasha and others, decided on 13.09.2017.
26. To the contrary, learned counsel representing the respondent/claimants invited attention of this Court to the judgment dated 25.10.2021 passed by Hon'ble Apex Court in N. Jayasree and others vs. Cholamandalam Ms. General Insurance Company Limited, to state that in the absence of any specific ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 17 reason and evidence on record the Tribunal below or the court are estopped from applying split multiplier in routine course and should .
apply multiplier as per decision of this Court in Sarla Verma's case(supra) as affirmed in Reshma Kumari's case(supra)(2013)9 SCC 65.
27. After having perused aforesaid judgment rendered by Hon'ble Apex Court, this Court finds that for determination of compensation in motor accident claims under Section 166 of the Act, court is required to follow multiplier method that too on the basis of table prepared by Hon'ble Apex Court while rendering the judgment in Sarla Verma's case (supra). Otherwise also,1988 Act does not envisage application of a split multiplier. Hon'ble Apex Court in aforesaid judgment after having taken note of various judgments rendered in past categorically concluded that at the time of calculation of the income, the court has to consider the actual income of the deceased and addition should be made to take into account future prospects. Hon'ble Apex Court has categorically held in the aforesaid judgment that in the absence of specific reason and evidence on record the Tribunal below or the court are estopped from applying split multiplier in routine course and should apply multiplier as per decision of this Court in Sarla Verma's case(supra). It has been further held by Hon'ble Apex Court in the ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 18 aforesaid judgment that in Pranay Sethi (supra), the Constitution Bench has directed addition of 15% of the salary in case the .
deceased was between the age of 50 to 60 years as a thumb rule, where a deceased had a permanent job. Since in the case at hand, petitioner was in permanent government job, Tribunal below rightly made addition of 15% on account of future prospects. In the aforesaid judgment, Hon'ble Apex Court held that while the evidence in a given case may indicate a different percentage of increase, standardization of the addition for future prospects should be made to avoid different yardsticks being applied or different methods of calculation being adopted. At this stage, it is profitable to reproduce paras No.21 to 28 of the 2021 of the judgment passed by Hon'ble Apex Court in N. Jayasree case (supra) hereinbelow: "21. Coming to the facts of the present case, the fourth appellant was the motherinlaw of the deceased. Materials on record clearly establish that she was residing with the deceased and his family members. She was dependent on him for her shelter and maintenance. It is not uncommon in Indian Society for the motherinlaw to live with her daughter and soninlaw during her old age and be dependent upon her soninlaw for her maintenance. Appellant no.4 herein may not be a legal heir of the deceased, but she certainly suffered on account of his death. Therefore, we have no hesitation to hold that she is a "legal representative" under Section 166 of the MV Act and is entitled to maintain a claim petition.
(II) Whether the High Court was justified in applying a split multiplier?
22. The deceased was aged 52 years at the time of the accident. He was working as an Assistant Professor and getting a monthly salary of Rs.83,831/ (Rupees eightythree thousand eight hundred thirtyone only). The evidence on record shows that he was a meritorious man having the qualifications of M.Sc, M.Phil. He was a first class holder in ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 19 M.Sc. He was a Selection Grade Lecturer in Mathematics and was a subject expert. He was also included in the panel of Mahatma Gandhi University and was appointed as Examiner in the Board of Examiners for CBCCSS Programme in Mathematics. Subsequently, he was .
appointed as Deputy Chairman of the Examiners Board. Evidence on record also shows that there is acute shortage of lecturers in Mathematics for appointment in colleges and retired Mathematics Professors are appointed in so many colleges. It is common knowledge that the teachers, especially Mathematics teachers, are employed even after their retirement in coaching centers. They may also hold private tuition classes. This would increase their income manifold after retirement.
23. In Sarla Verma1, this Court has held that while calculating the compensation, the courts should take into consideration not only the actual income at the time of the death but should also make additions by taking note of future prospects. It was further held that though the evidence may indicate a different percentage of increase, it is necessary to standardize the addition to avoid disparate yardsticks being applied or disparate methods of calculation being adopted.
24. In Reshma Kumari & Ors. vs. Madan Mohan & Anr. 9 (2013) 9 SCC 6, a three Judge Bench of this Court has approved the judgment in Sarla Verma(supra).
25. In Pranay Sethi(supra), this Court has not only approved the aforesaid observations made in Sarla Verma(supra) but also held as under:
"59.3. 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.
59.4. 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."
26. In K.R. Madhusudhan and Ors. vs. Administrative Officer and Anr., (2011)4 SCC 689, this Court was considering a case where the High Court had applied split multiplier for the purpose of calculation of compensation towards loss of dependency and held as under:
"8. In Sarla Verma1 judgment the Court has held that there should be no addition to income for future prospects where the ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 20 age of the deceased is more than 50 years. The learned Bench called it a rule of thumb and it was developed so as to avoid uncertainties in the outcomes of litigation. However, the Bench held that a departure can be made in rare and exceptional cases .
involving special circumstances.
9. We are of the opinion that the rule of thumb evolved in Sarla Verma1 is to be applied to those cases where there was no concrete evidence on record of definite rise in income due to future prospects. Obviously, the said rule was based on assumption and to avoid uncertainties and inconsistencies in the interpretation of different courts, and to overcome the same."
27. In Puttamma and Ors. vs. K.L. Narayana Reddy and Anr. (2013) 15 SCC 45, this Court was again considering a case where split multiplier for the purpose of calculation of dependency compensation was applied. It was held thus:
"32. For determination of compensation in motor accident claims under Section 166 this Court always followed multiplier method. As there were inconsistencies in the selection of a multiplier, this r Court in Sarla Verma (supra)prepared a table for the selection of a multiplier based on the age group of the deceased/victim. The 1988 Act, does not envisage application of a split multiplier.
33. In K.R. Madhusudhan v. Administrative Officer (supra) this Court held as follows: (SCC p. 692, paras 1415) "14. In the appeal which was filed by the appellants before the High Court, the High Court instead of maintaining the amount of compensation granted by the Tribunal, reduced the same. In doing so, the High Court had not given any reason. The High Court introduced the concept of split multiplier and departed from the multiplier used by the Tribunal without disclosing any reason therefor. The High Court has also not considered the clear and corroborative evidence about the prospect of future increment of the deceased. When the age of the deceased is between 51 and 55 years the multiplier is 11, which is specified in the 2nd column in the Second Schedule to the Motor Vehicles Act, and the Tribunal has not committed any error by accepting the said multiplier. This Court also fails to appreciate why the High Court chose to apply the multiplier of 6.
15. We are, thus, of the opinion that the judgment of the High Court deserves to be set aside for it is perverse and clearly contrary to the evidence on record, for having not considered the future prospects of the deceased and also for adopting a split multiplier method.
34. We, therefore, hold that in absence of any specific reason and evidence on record the tribunal or the court should not apply split multiplier in routine course and should apply multiplier as ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 21 per decision of this Court in Sarla Verma(supra) as affirmed in Reshma Kumari(supra)."
28. From the above discussion it is clear that at the time of calculation .
of the income, the Court has to consider the actual income of the deceased and addition should be made to take into account future prospects. Further, while the evidence in a given case may indicate a different percentage of increase, standardization of the addition for future prospects should be made to avoid different yardsticks being applied or different methods of calculation being adopted. In Pranay Sethi2, the Constitution Bench has directed addition of 15% of the salary in case the deceased was between the age of 50 to 60 years as a thumb rule, where a deceased had a permanent job. In view of the above, the High Court was not justified in applying split multiplier in the instant case.
(III) What is the amount of compensation that should be awarded to the appellants?
29. That takes us to the award of compensation. We have already noticed that the deceased was working as Assistant Professor at Devaswom Board Pampa College, Paruamala, and was drawing a monthly income of Rs.83,381/ which is clear from his salary certificate (Ex.A5) issued by the Principal of Devaswom Board Pampa College, Paruamala. The salary slip received by the deceased for the month of May 2011 (Ex.A6) also shows that his monthly salary was Rs.83,381/. These documents have been marked in evidence through the Principal of the said College who was examined as PW1. Thus, annual income of the deceased comes to Rs.10,00,572/. This Court in Sarla Verma1 has made it clear that the Annual Income of the deceased minus the income tax should be taken into account at the time of his death for the purpose of calculation of loss of dependency. The deceased had to pay Rs.1,13,424/ towards income tax per annum. After deducting the said amount the actual income of the deceased comes to Rs.8,87,148/."
28. At this stage, It would be profitable to take note of relevant paras of judgment rendered by Hon'ble Apex Court in Pranay Sethi case (supra): "59. 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.
::: Downloaded on - 17/04/2023 20:32:41 :::CIS 22(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 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 r 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."
29. In view of above, the claimants are entitled to Rs.15,000/ each on account of funeral expenses and loss of estate, whereas no amount can be awarded under the head of loss of love and affection, as such, the award passed by tribunal below ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 23 is required to be modified to the afore extent. However, the claimants being wife and sons of the deceased are entitled to .
spousal and parental consortium at the rate of Rs.40,000/ each. In this regard, reliance can be placed upon judgment of Hon'ble Apex Court in Magma General Insurance Co. Ltd. v. Nanu Ram and Ors., Civil Appeal No. 9581 of 2018 decided on 18.9.2018, wherein Hon'ble Apex Court has held as under:
"8.7 A Constitution Bench of this Court in Pranay Sethi (supra) dealt with the various heads under which compensation is to be awarded in a death case. One of these heads is Loss of Consortium.
In legal parlance, "consortium" is a compendious term which r encompasses 'spousal consortium', 'parental consortium', and 'filial consortium'.
The right to consortium would include the company, care, help, comfort, guidance, solace and affection of the deceased, which is a loss to his family. With respect to a spouse, it would include sexual relations with the deceased spouse.
Spousal consortium is generally defined as rights pertaining to the relationship of a husband wife which allows compensation to the surviving spouse for loss of "company, society, cooperation, affection, and aid of the other in every conjugal relation."
4 Parental consortium is granted to the child upon the premature death of a parent, for loss of "parental aid, protection, affection, society, discipline, guidance and training." Filial consortium is the right of the parents to compensation in the case of an accidental death of a child. An accident leading to the death of a child causes great shock and agony to the parents and 3 Rajesh and Ors. vs. Rajbir Singh and Ors. (2013) 9 SCC 54 4 BLACK'S LAW DICTIONARY (5th ed. 1979) family of the deceased. The greatest agony for a parent is to lose their child during their lifetime. Children are valued for their love, affection, companionship and their role in the family unit.
Consortium is a special prism reflecting changing norms about the status and worth of actual relationships. Modern jurisdictions worldover have recognized that the value of a child's consortium far exceeds the economic value of the compensation awarded in the case of the death of a child. Most jurisdictions therefore permit parents to be awarded compensation under loss of consortium on the death of a child. The amount awarded to the parents is a ::: Downloaded on - 17/04/2023 20:32:41 :::CIS 24 compensation for loss of the love, affection, care and companionship of the deceased child.
The Motor Vehicles Act is a beneficial legislation aimed at providing relief to the victims or their families, in cases of .
genuine claims. In case where a parent has lost their minor child, or unmarried son or daughter, the parents are entitled to be awarded loss of consortium under the head of Filial Consortium.
Parental Consortium is awarded to children who lose their parents in motor vehicle accidents under the Act.
A few High Courts have awarded compensation on this count5. However, there was no clarity with 5 Rajasthan High Court in Jagmala Ram @ Jagmal Singh & Ors. v. Sohi Ram & Ors 2017 (4) RLW 3368 (Raj); Uttarakhand High Court in Smt. Rita Rana & Anr. v. Pradeep Kumar & 6 Ors. respect to the principles on which compensation could be awarded on loss of Filial Consortium.
The amount of compensation to be awarded as consortium will be governed by the principles of awarding compensation under 'Loss of Consortium' as laid down in Pranay Sethi (supra).
r In the present case, we deem it appropriate to award the father and the sister of the deceased, an amount of Rs. 40,000 each for loss of Filial Consortium."
30. In view of aforesaid, now the compensation to be awarded to the claimants is recalculated hereinabelow: Established income of the deceased 50141 Income after granting addition of 15% 57663 Net income after 1/3rd deduction 38452 Loss of dependency after applying 5075664 multiplier of 11 Funeral charges 15000 Loss of estate 15000 Consortium @ Rs.40,000/ to each of 120000 claimants Total compensation 5225664
31. So far interest awarded by tribunal below is concerned, same does not call for any interference as such, same is upheld.
32. The award passed by learned Tribunal is modified to the afore extent. Both the appeals stand disposed of accordingly.
::: Downloaded on - 17/04/2023 20:32:41 :::CIS 25So far apportionment is concerned; it will remain the same, as held by learned Tribunal below.
.
33. The appeals stand disposed of in the afore terms, alongwith all pending applications.
(Sandeep Sharma)
Judge
11th April, 2023
(shankar)
r to
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