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Judgment
P.P.S. Janarthana Raja, J.—This appeal is preferred by the Appellant-Insurance Company against the judgment and Decree dated 29.01.2008 made in M.C.O.P No. 49 of 2006 on the file of the Motor Accidents Claims Tribunal, Subordinate Court, Uthamapalayam.
By consent of the learned Counsel on either side, the Civil Miscellaneous Appeal itself is taken up for final disposal.
Background facts in a nutshell are as follows:
The deceased-Parameswaran met with motor vehicle accident that took place on 29.07.2005 at about 8.30 p.m. The said deceased was a pillion rider in the Bajaj Pulsar Motorcycle, bearing Registration No. TN-37-AF-8975. The rider of the motorcycle was one Haris. The said motorcycle was driven by its rider in a rash and negligent manner and also at high speed, due to which it hit against a mile stone. Due to the same, the pillion rider as well as the rider of the motorcycle fell down from the motorcycle and sustained multiple grievous injuries all over the body. Immediately, after the accident they were taken to the Mettupalayam Government Hospital. On the way to the hospital, the pillion rider died. The claimants are the parents of the deceased. They claimed a sum of Rs. 7,00,000/-as compensation. The said motorcycle was insured with the Appellant-Insurance Company, who resisted the claim. On pleadings the Tribunal framed the following issues:
Whether the accident had occurred only due to the rash and negligent driving of the rider of the motorcycle?
Whether the claimants are entitled to compensation, if so, to what amount?
After considering the oral and documentary evidence, the Tribunal held that the accident had occurred only due to the rash and negligent driving of the rider of the motorcycle and awarded a compensation of Rs. 3,96,000/-with interest at 7.5% per annum from the date of the claim petition. The details of the compensation are as under:
Heads Amount Loss of dependency Rs. 3,84,000/- Loss of love and affection Rs. 10,000/- Funeral expenses Rs. 2,000/- ------------------ Total... Rs. 3,96,000/- ------------------
Aggrieved by that award, the Appellant-Insurance Company has filed the present appeal.
Learned Counsel appearing for the Appellant/Insurance Company questioned only the quantum of compensation awarded by the Tribunal and vehemently contended that the compensation awarded by the Tribunal is excessive, exorbitant and also without any basis and justification. Further, he contended that the Tribunal is wrong in adopting the multiplier on the basis of the age of the deceased, and it ought to have adopted the multiplier only on the basis of the age of the claimants. Learned Counsel for the Appellant/Insurance Company, further vehemently contended that the Tribunal is wrong in deducting 1/3rd of the amount towards personal expenses of the deceased, instead it should have deducted 50% of the amount towards personal expenses, since the deceased was a bachelor. Therefore, the award passed by the Tribunal is not in accordance with law and hence the same should be set aside.
Learned Counsel appearing for the Respondents 1 and 2/claimants submitted that the Tribunal had considered all the facts and circumstances of the case and awarded the compensation, which is just, fair and reasonable. It is a question of fact. Hence the order of the Tribunal is in accordance with law and the same should be confirmed.
Heard the counsel on either side and perused the materials available on record. On the side of the Respondents 1 and 2/claimants, P. Ws.1 and 2 were examined and documents Exs.P1 to P29 were marked. On behalf of the Appellant/Insurance Company no one was examined and no document was marked to substantiate their claim. P.W.1 Subbiah is the father of the deceased. P.W.2 Sakthivel, is the co-employer of the deceased. Ex.P1 is the First Information Report. Ex.P.2 is the Post Mortem Certificate. Ex.P3 is the Motor Vehicle Inspector''s Report. Ex.P.4 is the xerox copy of the judgment in S.T.C. No. 2083/2005. Ex.P5 is the Death Certificate of the deceased. Ex.P6 is the Legal-heirship Certificate. Ex.P7 is the S.S.L.C. Mark sheet of the deceased. Ex.P8 is the School Transfer Certificate of the deceased. Ex.P9 is the Radio & Television Course Certificate issued by the Lalitha Institute of Technoloy, Uthamapalayam. Ex.P10 is the Identity Card of the deceased, issued by the Tamil Nadu Polytechnic College, Madurai. Ex.P11 is the Certificate of Achievement issued by the Tamil Nadu Polytechnic College, Madurai. Ex.P12 is the Marksheet of the Mobile Phone Servicing issued by the Tamil Nadu Polytechnic College, Madurai. Ex.P13 is the Student Identity card for 2004-2006 issued by Sri Ramakrishna Mission Vidyalaya Polytechnic College, Coimbatore. Ex.P14 is the Conduct Certificate of the deceased issued by Sri Ramakrishna Mission Vidyalaya Polytechnic College, Coimbatore. Exs.P15 to Ex.P22 are the Hostel Mess Bills. Ex.P23 is the Pass book of the deceased. Ex.P24 is the ''A'' Examination of NCC Certificate. Ex.P25 is the NCC Annual Training Camp Certificate. Ex.P26 is the TV, Radio Repairs and Servicing Training Certificate issued by the NABARD, Madurai. Ex.P27 is the Prospectus of Sri Ramakrishna Mission Vidyalaya Polytechnic College, Coimbatore. Ex.P28 is the Letter pad of the Pris Electronics Shop. Ex.P29 is the Photograph of the deceased. After considering the above oral and documentary evidence, the Tribunal had given a categorical finding that the accident had occurred only due to the rash and negligent driving of the rider of the motorcycle. The finding of the Tribunal is based on valid materials and evidence and it is a question of fact. Hence the same is confirmed.
In the case of Sarla Verma And Ors. v. Delhi Transport Corporation and Anr. reported in (2009) 4 MLJ 997, the Apex Court has considered the relevant factors to be taken into consideration before awarding compensation and held as follows:
Before considering the questions arising for decision, it would be appropriate to recall the relevant principles relating to assessment of compensation in cases of death. Earlier, there used to be considerable variation and inconsistency in the decisions of Courts Tribunals on account of some adopting the Nance method enunciated in Nance v. British Columbia Electric Rly. Co. Ltd. (1951) AC 601 and some adopting the Davies method enunciated in Davies v. Powell Duffryn Associated Collieries Ltd. (1942) AC 601. The difference between the two methods was considered and explained by this Court in General Manager, Kerala State Road Transport Corporation, Trivandrum Vs. Mrs. Susamma Thomas and others, . After exhaustive consideration, this Court preferred the Davies method to Nance method. We extract below the principles laid down in General Manager, Kerala State Road Transport Corporation v. Susamma Thomas (supra).
In fatal accident action, the measure of damage is the pecuniary loss suffered and is likely to be suffered by each dependent as a result of the death. The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have live or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether.
The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependants, 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 dependants. Then that should be capitalised by multiplying it by a figure representing the proper number of year''s purchase.
The multiplier method involves the ascertainment of the loss of dependency or the multiplicand having regard to the circumstances of the case and capitalizing the multiplicand by an appropriate multiplier. The choice of the multiplier is determined by the age of the deceased (or that of the claimants whichever is higher) and by the calculation as to what capital sum, if invested at a rate of interest appropriate to a stable economy, would yield the multiplicand by way of annual interest. In ascertaining this, regard should also be had to the fact that ultimately the capital sum should also be consumed-up over the period for which the dependency is expected to last.
It is necessary to reiterate that the multiplier method is logically sound and legally well-established. There are some cases which have proceeded to determine the compensation on the basis of aggregating the entire future earnings for over the period the life expectancy was lost, deducted a percentage therefrom towards uncertainties of future life and award the resulting sum as compensation. This is clearly unscientific.
For instance, if the deceased was, say 25 years of age at the time of death and the life expectancy is 70 years, this method would multiply the loss of dependency for 45 years - virtually adopting a multiplier of 45 - and even if one-third or one-fourth is deducted therefrom towards the uncertainties of future life and for immediate lump sum payment, the effective multiplier would be between 30 and 34. This is wholly impermissible.
In U.P. State Road Transport Corporation and Others Vs. Trilok Chandra and Others, , this Court, while reiterating the preference to Davies method followed in General Manager, Kerala State Road Transport Corporation v. Susamma Thomas (supra), stated thus:
In the method adopted by Viscount Simon in the case of Nance also, first the annual dependency is worked out and then multiplied by the estimated useful life of the deceased. This is generally determined on the basis of longevity. But then, proper discounting on various factors having a bearing on the uncertainties of life, such as, premature death of the deceased or the dependent, remarriage, accelerated payment and increased earning by wise and prudent investments, etc., would become necessary. It was generally felt that discounting on various imponderables made assessment of compensation rather complicated and cumbersome and very often as a rough and ready measure, one-third to one-half of the dependency was reduced, depending on the life span taken. That is the reason why courts in India as well as England preferred the Davies formula as being simple and more realistic. However, as observed earlier and as pointed out in Susamma Thomas case, usually English courts rarely exceed 16 as the multiplier. Courts in India too followed the same pattern till recently when tribunals/courts began to use a hybrid method of using Nance method without making deduction for imponderables.... 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 dependants of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an appropriate multiplier
(Emphasis supplied)
In the case of Syed Basheer Ahamed and Others Vs. Mohd. Jameel and Another, , the Apex Court has held as follows:
168 of the Act enjoins the Tribunal to make an award determining "the amount of compensation which appears to be just". However, the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression "which appears to be just" vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of compensation.
Similarly, although the Act is a beneficial legislation, it can neither be allowed to be used as a source of profit, nor as a windfall to the persons affected nor should it be punitive to the person(s) liable to pay compensation. The determination of compensation must be based on certain data, establishing reasonable nexus between the loss incurred by the dependants of the deceased and the compensation to be awarded to them. In a nutshell, the amount of compensation determined to be payable to the claimant(s) has to be fair and reasonable by accepted legal standards.
In Kerala SRTC v. Susamma Thomas, M.N. Venkatachaliah, J. (as His Lordship then was) had observed that: (SCC p.181, para 5)
5 ...The determination of the quantum must answer what contemporary society ''would deem to be a fair sum such as would allow the wrongdoer to hold up his head among his neighbours and say with their approval that he has done the fair thing''. The amount awarded must not be niggardly since the ''law values life and limb in a free society in generous scales
At the same time, a misplaced sympathy, generosity and benevolence cannot be the guiding factor for determining the compensation. The object of providing compensation is to place the claimant(s), to the extent possible, in almost the same financial position, as they were in before the accident and not to make a fortune out of misfortune that has befallen them.
The question as to what factors should be kept in view for calculating pecuniary loss to a dependant came up for consideration before a three-Judge Bench of this Court in Gobald Motor Service Ltd. v. R.M.K. Veluswami, with reference to a case under the Fatal Accidents Act, 1855, wherein, K. Subba Rao, J. (as His Lordship then was) speaking for the Bench observed thus: (AIR p.1)
In calculating the pecuniary loss to the dependants many imponderables enter into the calculation. Therefore, the actual extent of the pecuniary loss to the dependants may depend upon data which cannot be ascertained accurately, but must necessarily be an estimate, or even partly a conjecture. Shortly stated, the general principle is that the pecuniary loss can be ascertained only by balancing on the one hand the loss to the claimants of the future pecuniary benefit and on the other any pecuniary advantage which from whatever source comes to them by reason of the death, that is, the balance of loss and gain to a dependant by the death must be ascertained.
Taking note of the afore extracted observations in Gobald Motor Service Ltd. in Susamma Thomas it was observed that: (Susamma Thomas case, SCC p. 182, para 9)
The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables e.g.the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have lived or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether.
Thus, for arriving at a just compensation, it is necessary to ascertain the net income of the deceased available for the support of himself and his dependants at the time of his death and the amount, which he was accustomed to spend upon himself. This exercise has to be on the basis of the data, brought on record by the claimant, which again cannot be accurately ascertained and necessarily involves an element of estimate or it may partly be even a conjecture. The figure arrived at by deducting from the net income of the deceased such part of income as he was spending upon himself, provides a datum, to convert it into a lump sum, by capitalising it by an appropriate multiplier (when multiplier method is adopted). An appropriate multiplier is again determined by taking into consideration several imponderable factors. Since in the present case there is no dispute in regard to the multiplier, we deem it unnecessary to dilate on the issue.
After considering the principles enunciated in the judgments cited supra, let me consider the facts of the present case.
At the time of the accident, the deceased was aged about 20 years. P.W.1, who is the father of the deceased, in his evidence has stated that the deceased was a Student in ITI and also he was doing part time job in repairing Radio, TV and Mobile phone and he was also an Electrician, and he was earning a sum of Rs. 4,000/-per month. Further in his evidence, it is stated that the rider of the motorcycle caused the accident and the rider was also charge-sheeted by Mettupalayam Police Station in F.I.R. No. 633/05 under Sections 279, 337 and 304A IPC. Ex.P2 is the Post Mortem Certificate and Ex.P5 is the Death Certificate, in which the age of the deceased is stated as 20 years. Ex.P9 is the Radio & Television course certificate issued by the Lalitha Institute of Technoloy, Uthamapalayam. Ex.P26 also shows that he has taken training in TV, Radio Repairs and Service in NABARD, Madurai. After considering the above oral and documentary evidence, the Tribunal has fixed the monthly income of the deceased at Rs. 3,000/-per month. Out of the said sum, 1/3rd of the amount i.e., Rs. 1,000/-was deducted towards the personal expenses of the deceased and the balance 2/3rd of the amount i.e., Rs. 2,000/-was taken as the monthly contribution of the deceased to the family. After taking into consideration of the age of the deceased, the Tribunal adopted the multiplier of ''16'' and determined the loss of dependency at Rs. 3,84,000/-(Rs. 2,000X12X16). Learned Counsel for the Appellant-Insurance Company vehemently contended that the Tribunal should have deducted 50% towards personal expenses as against 1/3rd, since the deceased was a bachelor. Further he contended that the Tribunal is wrong in adopting the multiplier, on the basis of the age of the deceased and the Tribunal ought to have adopted the multiplier only on the basis of the age of the claimants. He relied on the Supreme Court judgment in the case of Sarla Verma and Ors. v. Delhi Transport Corporation and Anr. (cited supra) in support of his contention. As rightly pointed out by the learned Counsel for the Appellant, as per the principles enunciated in the Sarala Verma''s case (cited supra) only 50% of the amount has to be deducted towards personal expenses, if the deceased was a bachelor. The Tribunal has correctly taken the monthly income of the deceased at Rs. 3,000/-. Out of the said sum, if 50% of the amount i.e., Rs. 1,500/-is deducted towards personal expenses of the deceased, the monthly contribution of the deceased to the family works out to Rs. 1,500/-. After considering the age of the mother of the deceased (50 years), the correct multiplier that should be adopted in the present case is ''13''. If ''13'' multiplier is adopted, the loss of dependency works out to Rs. 2,34,000/-(Rs. 1,500X12X13). Therefore, the loss of dependency is modified to Rs. 2,34,000/-as against Rs. 3,84,000/-awarded by the Tribunal. The Tribunal has awarded a sum of Rs. 10,000/-towards loss of love and affection, which is very low and meagre. The parents have lost the love and affection of their only son. Therefore, I am of the view that it would be reasonable to award a sum of Rs. 15,000/-as against Rs. 10,000/-awarded by the Tribunal. The Tribunal has awarded a sum of Rs. 2,000/-towards funeral expenses, which is very low and the Tribunal has not awarded any sum towards transport charges. The accident took place in Mettupalayam and the body of the deceased was brought from Mettupalayam to Uthamapalayam. Therefore, it would be reasonable to award a consolidated sum of Rs. 10,000/-towards transport charges as well as funeral expenses. The Tribunal has not awarded any sum towards loss of future prospects. After taking into consideration of the age of the deceased, had he not died due to the accident, certainly he would have earned more. After taking into consideration of the same, it would be reasonable to award a sum of Rs. 30,000/-towards loss of future prospects. The Tribunal has fixed the interest rate at 7.5% p.a. After taking into consideration of the date of accident, date of award and the prevailing rate of interest during that time, the interest fixed by the Tribunal at 7.5% per annum from the date of petition is reasonable and hence the same is confirmed. The details of the modified compensation as per the above discussion are as under:
Heads Amount Loss of dependency Rs. 2,34,000/- Loss of love and affection Rs. 15,000/- Funeral expenses and transport charges Rs. 10,000/- Loss of future prospects Rs. 30,000/- --------------- Total... Rs. 2,89,000/- --------------- (Rounded off to Rs. 2,90,000/-)
Therefore, the claimants are entitled to the modified compensation of Rs. 2,90,000/-with interest at 7.5% p.a. from the date of petition.
Learned Counsel for the Appellant-Insurance Company has submitted that 75% of the award amount with proportionate accrued interest has already been deposited by order of this Court dated 28.01.2009. 75% of the award amount granted by the Tribunal comes to Rs. 2,97,000/-. Under the circumstances, the claimants are permitted to withdraw the modified compensation of Rs. 2,90,000/-with interest at 7.5; p.a. from the date of petition, less the amount if any, already withdrawn, on making proper application. The Appellant-Insurance Company is also permitted to withdraw the balance amount on making proper application.
With the above modification, the Civil Miscellaneous Appeal is disposed of. Consequently, connected miscellaneous petition is closed. No costs.