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2.3. When this appeal came up for consideration, the Division Bench found that several other Courts relying on the decision in SHIVAMMAL, have held that family pension could not be deducted. It was also noticed that the facts of this case were similar to the facts of SHIVAMMAL. The claimants also contended that were the loss of dependency was determined by multiplier method (Davies Method) adopting an appropriate multiplier, the question of further deduction would not arise. In this back ground, it was felt that the two questions referred required consideration by a larger Bench.

14. We next turn to the manner in which family pension should be taken into account. Though Davies method is the preferred method, we will, deal with both Nance method and Davies method to bring out the difference in the nature of deduction to be made on account of family pension.

14.1. Under the NANCE method, it is necessary first to estimate what was the deceased man's expectation of life, if he had not been killed in the accident. Next the Court should estimate what sums, the deceased would have applied to the support of his family having regard to the amount he used to spend on the family. On that basis, the annual sum which would have been applied for the benefit of the family is to be ascertained. That sum has to be multiplied by the number of years of lost, that is the remaining number of years of man's estimated span of life. The sum arrived at, should be discounted so as to arrive at its equivalent in the form of a lumpsum payable as damages. Then further deductions should be made for the benefit accruing to the family from the acceleration of their interest in his estate and on account of any member of family dying or getting married. For example, let us take a hypothetical case where the deceased died when he was 45 years, leaving him surviving his wife and two minor children. His life span is determined as 70 years and he was in a pensionable job where the superannuation age is 60 years. His monthly emoluments were Rs. 5,000/- and he was spending Rs. 3,750/- on the family. If he had survived and retired, he would have got a pension of Rs. 2,000/- out of which he would have spent Rs. 1,500/- on his family. After his death, his wife was entitled to get Rs. 1,000/- per month as family pension. On these facts, the position will be thus:

It would thus be seen that the more logical and appropriate method is either to take note of both the pecuniary loss (value of pension) and pecuniary benefit (family pension) or omit both, while calculating the loss of dependency. Taking note of only the pecuniary benefit (family pension) without taking note of the pecuniary loss (that is failing to add value of pension factor to monthly salary) will lead to unjust and illogical results.

14.8 Therefore when the compensation in regard to a deceased who was holding a pensionable job, is calculated, by the multiplier (Davies) method, if the monthly loss of dependency is arrived at with reference to only the monthly salary, without adding the value of the pension factor, then, there is no need to make any deduction towards family pension, as a pecuniary advantage. Determination of compensation is but a process of estimation, balancing the pecuniary losses and benefits. An arithmetically precise calculation is impossible to achieve having regard to several imponderables involved. So long as a conscious effort is made to broadly balance the losses and benefits and a uniform and well settled method is applied in calculation, slight imbalances may be ignored. We therefore hold that ignoring both the pecuniary loss of pension factor and pecuniary benefit of family pension while calculating compensation, is a satisfactory and practical solution having regard to the difficulty in ascertaining the monetary value of pension factor. Such a course has the seal of approval of the Supreme Court, as can be inferred from the, decision in SHIVAMMAL.

15. In view of the above, we answer the questions referred to the Full Bench as follows :

1) The family pension amount is a pecuniary benefit which has to be taken note of to balance the pecuniary loss, to arrive at the net loss, as a consequence of death, which constitutes the measure of damages;
2) While assessing the compensation as per the multiplier method (DAVIES method) in the case of the death of an employee in pensionable service, a deduction on account of family pension can be made (as a pecuniary benefit arising out of the death) only if the pension factor had been taken note of as a part of monthly emoluments of the deceased, while calculating the loss of dependency. If the loss of dependency is calculated only on the monthly emoluments received, without adding the value of the pension factor to such emoluments, then it is unnecessary to make any deduction on account of receipt of Family Pension.