Karnataka High Court
Smt. Rajeswari And Others vs The Divisional Controller, Bangalore ... on 4 September, 1998
Equivalent citations: I(1999)ACC347, 2000ACJ732, ILR1999KAR1983, 1999(1)KARLJ188, 1999 A I H C 2248, (1999) 4 ICC 168, (1999) 1 KANT LJ 188, (1999) 1 TAC 838, (1999) 1 ACC 347, (2000) 1 ACJ 732, (1999) 3 CIVLJ 411
Author: N.S. Veerabhadraiah
Bench: N.S. Veerabhadraiah
JUDGMENT N.S. Veerabhadraiah, J.
1. This is a claimants appeal for enhancement of compensation being dissatisfied with the award of compensation in M.V.C. No. 1623 of 1987, dated 25-1-1990 on the file of the Motor Accident Claims Tribunal, Bangalore City.
2. The brief facts are as follows:
The wife, sons and mother of the deceased Nagabhushana presented a petition under Section 110-A of the Motor Vehicles Act claiming compensation of Rs. 27,90,728/- on the ground that on 30-5-1987 at about 8.40 p.m. while the deceased Nagabhushana was boarding the stationary bus bearing registration No. MEF 370 on route No. 284-B from Shivajinagar to Yelahanka, the driver of the bus drove the vehicle with a jerk as a result, the deceased fell down, sustained multiple grievous injuries and succumbed to the said injuries at 10.45 p.m. in the hospital. The deceased was working as an Assistant Executive Engineer in the Karnataka Electricity Board drawing a salary of Rs. 4,600/- p.m. He had the prospects of becoming the Chief Engineer and also the head of the Karnataka Electricity Board. At the time of the accident, the deceased was aged 41 years.
3. The respondent-Bangalore Transport Service (KSRTC) filed statement of objections resisting the claim petition inter alia contending as follows:
The compensation claimed is highly excessive and exorbitant. The second respondent was driving the bus slowly. The allegation that the bus was stationary at the time of the alleged accident is false. The deceased was responsible for the alleged accident, who tried to jump into the moving bus and fell down, as a result sustained injuries due to his own negligence and died and denied all the other averments which are inconsistent with the objections statement and prayed to dismiss the petition.
4. The claimants examined P.Ws. 1 to 4 and marked Exts. P-1 to P. 9, whereas the respondents did not choose to lead any evidence. The Claims Tribunal, considering the evidence of P.Ws. 1 to 4 and also taking into account the salary of the deceased awarded a compensation of Rs. 2,77,907.36 ps. Being dissatisfied with the award of compensation, the claimants have come up with this appeal.
5. The first contention of the learned Counsel for the appellants is that the Court below has erred in not applying the proper multiplier as laid down in the decision in Jyotsna Dey and Others v State of Assam and Others , and also has not followed the decision in General Manager, Kerala State Road Transport Corporation v Mrs. Susamma Thomas. He secondly contended that the award of compensation on the head of loss of dependency is on the lower side and the Claims Tribunal ought to have taken into consideration the dependency at Rs. 9,000/- by doubling the amount of Rs. 4,581/- which the deceased was drawing as salary at the time of the accident and therefore, prayed to enhance the compensation amount.
6. Learned Counsel for the respondent contended that the amount of compensation awarded by the Claims Tribunal is just and proper and does not call for interference and therefore, prayed to dismiss the appeal.
7. It is not in dispute that the deceased Nagabhushan succumbed to the injuries in the accident that took place on 30-5-1987 at about 8.40 p.m. near Shivajinagar bus stop in which the bus belonging to Bangalore Transport Service bearing registration No. MEF 370 was involved. That in so far as the aspect of negligence is concerned, the decision has become final since the respondent has not preferred any appeal.
8. The point for consideration is, whether the appellants are entitled for enhancement of compensation and if so, to what orders?
9. It is in the evidence of P.W. 1 that her husband was working as Assistant Executive Engineer in the office of the Karnataka Electricity Board drawing a salary of Rs. 4,581.70 ps. and that he was contributing a sum of Rs. 3,400/- for the maintenance of the family and it is further in her evidence that she has spent Rs. 17,000/- for transportation of the body, funeral and obsequies etc., It is in the evidence of P.W. 4, M.H. Parvin, the Accounts Officer of K.E.B. that the deceased joined the services on 26-2-1969 and that his date of birth is 10-8-1944 and by the time of attaining the age of superannuation, he had the chance of becoming an Executive Engineer. Thus from the evidence of P.W. 1, Rajeshwari and the evidence of P.W. 4, M.H. Parvin, it shows that the deceased had the prospects of becoming an Executive Engineer by the time the deceased attained the age of superannuation and it is further seen that at the time of the accident the deceased was drawing a salary of Rs. 4,581.70 and the same is evidenced from Ext. P-7. The Claims Tribunal fixed Rs. 1,832.69 x 12 x 12 = 2,63,907.36 as the loss of dependency and awarded Rs. 6,000/- towards loss of expectation of life, Rs. 5,000/- towards loss of consortium and another Rs. 3,000/- towards funeral expenses, in all awarded a total compensation of Rs. 2,77,907.36.
10. It is the contention of the learned Counsel for the appellants that though the salary of the deceased was Rs. 4,581.70 as per Ext. P-7, the Claims Tribunal erred in taking 1/4th being Rs. 1,110.89 and arriving at the figure Rs. 3,332.69 as the contribution of the deceased to his family and the Claims Tribunal further erred in taking another sum of Rs. 1,500/- and fixing the loss of dependency at Rs. 1,832.69. It is nextly contended that the amount of compensation awarded under different heads is also meagre and inadequate.
11. Learned Counsel for the appellants relied on the decision in Jyotsna Dey's case, supra, wherein the Supreme Court held thus:
"Quantum -- Fatal accident -- Deceased aged 45, earning Rs. 400/- p.m. -- Claimants: Widow and two minor children -- Dependency assessed at Rs. 250/- p.m. and loss assessed for 25 years and deducted on account of lump sum payment and uncertainties of life -- Awarded Rs. 60,000/-".
Relying on the decision, supra, he submitted that the Claims Tribunal ought to have minimum adopted the multiplier of 25 and awarded the compensation.
12. Secondly, he relied on the decision in Kerala State Road Transport Corporation's case, supra, and pointed out the observations made at para 13 which reads as under:
"13. In the present case, the deceased was 39 years of age. His income was Rs. 1,032 per month. Of course, the future prospects of advancement in life and career should also be sounded in terms of money to augment the multiplicand. While the chance of the multiplier is determined by two factors, namely, the rate of interest appropriate to a stable economy and the age of the deceased or of the claimant whichever is higher, the ascertainment of the multiplicand is a more difficult exercise. Indeed, many factors have to be put into the scales to evaluate the contingencies of the future. All contingencies of the future need not necessarily be baneful. The deceased person in this case had a more or less stable job. It will not be inappropriate to take a reasonably liberal view of the prospects of the future and in estimating the gross income it will be unreasonable to estimate the loss of dependency on the present actual income of Rs. 1,032/- p.m. We think, having regard to the prospects of advancement in the future career, respecting which there is evidence on record, we will not be in error in making a higher estimate of monthly income at Rs. 2,000/- as the gross income. From this has to be deducted his personal living expenses, a quantum of which again depends on various factors such as whether the style of living was Spartan or bohemian. In the absence of evidence, it is not unusual to deduct one-third of the gross income towards the personal living expense and treat the balance as the amount likely to have been spent on the members of the family and the dependents. This loss of dependency should capitalise with the appropriate multiplier. In the present case, we can take about Rs. 1,400/- p.m. or Rs. 17,000/- per year as the loss of dependency and if capitalised on a multiplier of 12 which is appropriate to the age of the deceased, the compensation would work out to (Rs. 17,000 x 12 = 2,04,000) to which is added the usual award for loss of consortium and loss of the estate each in the conventional sum of Rs. 15,000".
Relying on para 13, learned Counsel for the appellants contended that the deceased was admittedly drawing a salary of Rs. 4,581.00 and the same has to be doubled to estimate the loss of dependency which comes to Rs. 9,000.00 and thereupon, by applying the multiplier as shown in the Second Schedule that the compensation has to be awarded. If the contentions of the appellants were to be accepted, we have to double the salary of the deceased and after arriving to the figures of annual earnings, the same has to be multiplied by the figures mentioned in the Second Schedule which according to us is totally impermissible. It is settled principle that each case has to be examined on its own facts and circumstances of the case. His Lordship M.N. Venkatachaliah, J. in the same decision at para 7 held as follows:
"The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependents and to deduct therefrom such part of his income as the deceased was accustomed to spend upon himself, as regards both self-maintenance and pleasure and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependents. Then that should be capitalised by multiplying it by a figure representing the proper number of year's purchase.
Much of the calculation necessarily remains in the realm of hypothesis and in that region arithmetic is a good servant but a bad master since there are so often many imponderables. In every case, 'it is the overall picture that matters' and the Court must try to assess, as best as it can the loss suffered".
Therefore, the Court has to take into consideration the earnings and the amount that he was contributing for the maintenance of the family and after deriving the annual dependency, that has to be multiplied by the appropriate figure.
13. At para 11 of the judgment, it is further pointed out as follows:
"We are aware that some decisions of the High Courts and of this Court as well have arrived at compensation on some such basis. These decisions cannot be said to have laid down a settled principle. They are mostly instances of particular awards in individual cases. The proper method of computation is the multiplier method. Any departure, except in exceptional and extraordinary cases, would introduce inconsistency of principle, lack of uniformity and an element of unpredictability for the assessment of compensation. Some judgments of the High Courts have justified a departure from the multiplier method on the ground that Section 110-B of the Motor Vehicles Act, 1939 is so far as it envisages the compensation to be just, the statutory determination of a 'just' compensation would unshackle the exercise from any rigid formula. It must be borne in mind that the multiplier method is the accepted method of ensuring a 'just' compensation which will make for uniformity and certainty of the awards. We disapprove these decisions of the High Courts, which have taken a contrary view. We indicate that the multiplier method is the appropriate method, a departure from which can only be justified in rare and extraordinary circumstances and very exceptional cases".
Therefore, it is clear that in all cases, as a general rule, the earnings of the deceased or the salary that he was drawing cannot be doubled and it is cautioned that it is only in rare and extraordinary circumstances that too in exceptional cases, such principles have to be applied, that is to say, as is given in Susamma Thomas's case, supra, where the income of Rs. 1,032/- p.m. is estimated at Rs. 2,000/- p.m. taking into consideration the prospects and future career. Therefore, it can be said that the estimation of monthly income at Rs. 2,000 is rare, extraordinary and an exceptional case and therefore, the same principles cannot be adopted to the present case for the purpose of fixing the loss of dependency as contended by the learned Counsel and thereby, we totally disagree with the submissions made by the learned Counsel for the appellants. It is to be noted that in Susamma Thomas's case, supra, the deceased was aged 39 years and the multiplier adopted is 12. Accordingly, the compensation was enhanced. In that view of the matter, insofar as the first contention of the claimants' Counsel that the multiplier of 25 has to be adopted and the earnings of the deceased has to be doubled for the purpose of computing the loss of dependency is not sustainable in view of the principles laid down by the Apex Court. We have to observe that in awarding compensation, particularly in case of death, the principles are almost settled, that is to say, that the Courts have to take into consideration the earnings of the deceased, the age of the deceased and also the age of the legal representatives who claim compensation, and thereupon, after arriving to the figures of annual dependency, what multiplier that has to be applied is also settled in Uttar Pradesh State Road Transport Corporation v Trilok Chandra and Others . At para 14 of the judgment, it has been observed as follows.-
"Under the formula advocated by Lord Wright in Davies, the loss has to be ascertained by first determining the monthly income of the deceased, then deducting therefrom the amount spent on the deceased and thus assessing the loss to the dependents of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an appropriate multiplier. Let us illustrate: X male, aged about 35 years, dies in an accident. He leaves behind his widow and 3 minor children. His monthly income was Rs. 3,500/-. First deduct the amount spent on X every month. The rough and ready method hitherto adopted where no definite evidence was forthcoming, was to break up the family into units, taking two units for an adult and one unit for a minor. Thus X and his wife make 2 + 2 = 4 units and each minor one unit i.e., 3 units, in all totalling 7 units. Thus the share per unit works out to Rs. 3,500/7 = Rs. 500/- p.m. It can thus be assumed that Rs. 1,000/- was spent on X. Since he was a working member some provision for his transport and out of pocket expense has to be estimated. In the present case, we estimate the out of pocket expense at Rs. 250/-. Thus the amount spent on tne deceased X works out to Rs. 1,250/- per month leaving a balance of Rs. 3,500 -- 1,250 = Rs. 2,250/- per month. This amount can be taken as the monthly loss to X's dependents. The annual dependency conies to Rs. 2,250 x 12 = Rs. 27,000. This annual dependency has to be multiplied by the use of an appropriate multiplier to assess the compensation under the head of loss to the dependents".
Further, at the end of para 17, it has been held as follows:
"What we propose to emphasise is that the multiplier cannot exceed 18 years purchase factor. This is the improvement over the earlier position that ordinarily it should not exceed 16. We thought it necessary to state the correct legal position as Courts and Tribunals are using higher multiplier as in the present case where the Tribunal used the multiplier of 24 which the High Court raised to 34 thereby showing lack of awareness of the background of the multiple system in Davies' case".
That by applying the principles laid down in the decisions, supra, firstly, the Court has to determine as to how many units the deceased family consists of including the deceased and after deducting the relevant units for personal expenses in respect of the deceased, the balance units have to be taken as loss of dependency and thereupon the appropriate multiplier has to be applied. It is further pointed out that the maximum that is applicable is 18 by taking into consideration the age factor. Therefore, in the light of the above principles, we proceed to consider what is the amount of dependency and the compensation that the appellants are entitled to.
14. In the present case, it is evident from Ext. P-7 that the total salary the deceased Nagabhushana was drawing was Rs. 4581.70. It is in the evidence of P.W. 1 that her family consists of herself, 2 children, her mother-in-law and the deceased and the deceased was contributing a sum of Rs. 3,500/- p.m. for the maintenance of the family. It is therefore, the salary of the deceased which becomes a relevant figure for the purpose of computation of the loss of dependency. The salary that the deceased Nagabhushana was drawing was Rs. 4,581.70. The deceased being 2 units, wife 2 units, 2 children 1 unit each and the mother of the deceased 2 units, in all the total is 8 units. Thus, the share per unit works out to Rs. 572.60 per month. The deceased being an Assistant Executive Engineer at the time of the accident, naturally he would have spent some amount towards transport and other personal expenses. Therefore, deduction that has to be made in respect of the deceased is 2 units + Rs. 250/- being his personal expenses. That would come to Rs. 1395.20. If the said amount is deducted, Rs. 3,186/- would represent the loss of dependency per month. Thus the annual dependency would be Rs. 3,186 x 12 - Rs. 38,232/-. In the case on hand, the deceased was aged 41 years. In the light of the principles laid down in Trilok Chandra's case, supra, the multiplier that is now applicable is 14, that is Rs. 38,232 x 14 = Rs. 5,35,248/-, being the loss of dependency.
15. The Claims Tribunal having fixed the loss of dependency at Rs. 3,332.69, after deduction 1/4th has further deducted Rs. 1,500/- being the amount of pension received by the petitioner and held Rs. 1,832.69 as the loss of dependency. Here, we have to observe that it is not permissible to deduct whatever the benefits the wife and children would receive on account of the death of the deceased in the motor vehicle accident, that is, the amount received either by way of pensionary benefits, provident fund, L.I.C. or any other amount. What the Tribunal has to consider is. what was the earnings of the deceased, the contribution that he was making to the dependents, the age factor and the proper multiplier that has to be applied. In the case on hand, the Claims Tribunal has crept into error in deducting the amount of pensionary benefit which the wife was receiving. In this case, we have already held that the petitioners being the wife, sons and mother of the deceased are entitled for Rs. 5,35,248/- being the loss of dependency. Apart from the said amount, the wife is entitled for Rs. 5,000/- towards loss of consortium, Rs. 3,000/-towards funeral expenses and Rs. 6,000/- towards loss of estate which is awarded by the Claims Tribunal. In all, the appellants are entitled for a total compensation of Rs. 5,49,248/- with interest at 12% p.a. from the date of the petition till the date of realisation of the said amount.
16. For the foregoing reasons, we award a compensation of Rs. 5,49,248/- less Rs. 2,77,907.36 that is Rs. 2,71,340.64 being the enhanced amount with costs.