of the deceased and what amount out of it to be deducted and what
amount to be taken into consideration towards loss of contribution to
the claimants from the sudden accidental death, where the annual
income is in the taxable range, the words "actual salary" should be read
as "actual salary less tax; from the deceased was aged 32 years as per
Ex.A.4 P.M. Report and as per Ex.A.11 driving licence, the deceased was
born on 30.07.1982 and the Ex.A.10 SSC certificate of the deceased also
proves the same to say as on date of accident 19.11.2003, he completed
31 years. The deceased was a post-graduate in Applied Science as per
Ex.A.13 and 15 from Periyar University and passed in distinction in the
year 2004 and those are the copies of provisional and regular P.G.Degree
certificates to that effect. As the claim is under Section 166 of the Act,
as per Sarla Verma, Reshmakumari and Rajesh the multiplier that is
applicable is 16 for persons in the age group of 31 to 35 years. The
tribunal rightly has taken the multiplier 16. Coming to earnings for
consideration and personal expenses deduction out of it, the evidence of
P.W.3 who is the Manager(Legal)of Fullerton Indian Private Limited,
Hyderabad branch where the deceased was working as H.R. Assistant
Manager, since 23.08.2013 (even by the date of accidental death on
19/20.11.2013) as per Ex.A.7 as probationer to say undergoing probation
still. Merely because he is in probation, does not mean he was not in
employment with monthly salary to be computed for assessing
compensation as on the date and time of death. As per Section 2(22) of
the Income Tax Act, 1961(for short, 'the IT Act') income is an inclusive
definition which includes any special allowance and benefit granted to
the assessee (employee) other than perks to meet expenses for
performance of duties or as employment of profit or to compensate for
increase in the cost of living or value of any benefit or perquisite.
16. As per Section 17(2) in Chapter 4 of the I.T.Act, in
computation of the income under the Head Salaries perquisite includes
value of rent free accommodation provided by the employer or value of
any rent concession in respect of the accommodation provided by the
employer. Salary includes the pay, allowances, bonus or commission
payable monthly or otherwise or any monetary payments, by whatever
name called, but does not include D.A. or D.P. unless it enters into the
computation of superannuation or retirement benefits, employer's
contribution to P.F., allowances exempted from payment of tax, value
of perks specified and any payment or expenditure specially excluded.
17. When such is the case, as per Ex.A.8 the salary statement, his
gross salary was Rs.37,125/-p.m. comprising of basic of Rs.13,125/-, HRA
of Rs.4,800/-, Personal Allowance of Rs.18,400/- and Conveyance
Allowance of Rs.800/- and out of it, the deductions are IT deduction of
Rs.438/-, P.F. of Rs.1575/-, Professional Tax of Rs.200/-and Mediclaim
recovery of Rs.444/-and the net salary thereby is Rs.34,468/-Ex.A.9
Salary sheet also proved through P.W.3 for the total three months period
from 23.08.2013 to 19.11.2013 in this regard. P.W.3 denied the
suggestion of deceased never worked in the entity and Exs.A.7 to A.9 are
created or he was not paid any salary by the entity or he is deposing
false. There is no other much less worth cross-examination to discredit
the evidence of P.W.3 or to doubt the probative value of the Exs.A.7 to
A.9. From the above, out of the gross salary of the deceased proved of
Rs.37,125/-p.m. comprising of basic of Rs.13,125/-, HRA of Rs.4,800/-,
Personal Allowance of Rs.18,400/- and Conveyance Allowance of
Rs.800/- and out of it the deductions are IT deduction of Rs.438/-, P.F.
of Rs.1575/-, Professional Tax of Rs.200/-and Mediclaim recovery of
Rs.444/-in showing the net salary as Rs.34,468/-; the Conveyance
Allowance of Rs.800/-, IT deduction of Rs.438/-, P.F. contribution of
Rs.1575/-, Professional Tax of Rs.200/-and Mediclaim recovery of
Rs.444/-even deducted in arriving the net amount thereafter, for the
HRA not liable for deduction as it is not confined to the personal benefit
of deceased but for the whole family of the deceased who are the
claimants. Further, even it is shown in the pay band as Personal
Allowance for a sum of Rs.18,400/-, it is not for any specific personal
meeting of requirement like tour travel etc., to personally benefit the
employee but for part of the earnings of the deceased to contribute to
the family even out of it after meeting the personal expenses deduction
of 1/3rd or 1/4th, as the case may be. Coming to personal expenses
deduction, out of the 4 claimants, the father is a retired employee and
pensioner and contended as not dependent solely on the deceased.
Even the father is not solely dependent, there could be some
contribution to him by the deceased out of his earnings for what he gets
pension or other retirement benefits is not only to him but also to his
wife and any other family members and that may or may not be
sufficient for his survival. What is laid down in Sarla Verma in arriving
personal expenses deduction of deceased depending upon number of
dependents, even father therefrom not taken as a dependent but for the
other three, as per paras 30 to 33 of the expression, which are
reiterated in Reshma Kumari as referred supra, if 1/3rd deducted
towards personal expenses of the deceased, the contribution of the
deceased to the family is the remaining 2/3rds which comes to
(Rs.37,125- Conveyance Allowance of Rs.800 PLUS IT deduction of Rs.438 PLUS P.F.
contribution of Rs.1575 PLUS Professional Tax of Rs.200 PLUS Mediclaim recovery
of Rs.444=Rs.34,468/-is the net salary as arrived by the tribunal and
even instead of Rs.438/- if at least 12% deducted towards income tax,
after 50% prospective increase on Rs.34,468 PLUS Rs.438=Rs.52,359/-, of
which 12% towards income tax deduction taken at Rs.6,283/-, the net
amount comes to Rs.46,076/- and after 1/3rd deduction, the 2/3rds
comes to Rs.30,717/- x 12x16=Rs.58,97,718/-, besides loss of consortium
to the first claimant-wife Rs.1,00,000/-, loss of estate Rs.10,000/-, care
and guidance to the minor child Rs.25,000/- even as awarded by the
tribunal taken, funeral expenses Rs.25,000/- as laid down in Rajesh
supra, it comes to more than what the tribunal awarded of
Rs.34,50,000/-. Thus, as held in Ranjana Prakash supra, this Court has
since no power to enhance for what is awarded is no way excessive but
low, there is nothing to reduce the quantum of compensation awarded
by the tribunal of Rs.34,50,000/-.
HYDERABAD HIGH COURT
HON'BLE SRI JUSTICE NOOTY RAMAMOHANA RAO AND HONOURABLE Dr. JUSTICE B.SIVASANKARA RAO
M.A.C.M.A.No.471 OF 2016
Dated 13.04.2016
Reliance General Insurance Company Limited
V
Smt. S.Sunitha @ R.Sunitha
Citation:2016(6) ALLMR (JOURNAL)14
Impugning the award dated 27.10.2015 in O.P.No.224 of 2014
passed in favour of the four claimants for Rs.34,50,000/-(Rupees thirty
four lakhs fifty thousand only) with interest at 12% p.a. from the date of
claim petition till date of decree and later at 6% p.a. by the learned
Chairman of the Motor Accidents Claims Tribunal-cum-II Additional Chief
Judge, (Fast Track Court), City Civil Court (for short, 'Tribunal'),
Hyderabad, the 2nd respondent-Reliance General Insurance Company
Limited (for short, 'Insurer'), rep. by its Legal Manager, of the
O.P.No.224 of 2014, preferred the present appeal.
2. The appeal respondent Nos. 1 to 4 are no other than wife,
minor daughter and parents of the deceased by name S.Prabhu
Santhoshkumar, aged about 32 years. They filed said claim petition for
Rs.80,00,000/-(Rupees Eighty lakhs only) under Section 166 of the Motor
Vehicle Act,1988 (for short, 'the Act') against owner of the Maruti
Suzuki bearing No.AP15TV 3065 (5th respondent to the appeal) and the
appellant-Insurer herein.
3. As per the claim petition, it was due to the rash and negligent
driving of the driver of the crime car stated supra belongs to the 5th
respondent herein, the car dashed the bike of the deceased Prabhu
Santhoshkumar while he was proceeding on his bike on 19.11.2013 at
about 21.45 hours near Abhimanyu Bar, Vaidehinagar, Vanasthalipuram
and was taken to Kamineni Hospital, Hyderabad immediately after the
accident, however, he was succumbed to the injuries meantime.
4. The 1st respondent-owner of the car Smt. K.Laxmi remained
exparte before the tribunal and the 2nd respondent-Insurer supra
contested the matter by filing counter while disputing the manner of
accident, age, avocation, earnings of the deceased, entitlement of
compensation and any negligence on the part of driver of the car,
contending that the deceased was in drunken condition and the accident
was taken place due to his sole negligence and otherwise as per rough
sketch there was collusion between the two vehicles, there is no valid
registration of the car and driver of the car has no valid licence in
seeking to dismiss the claim.
5. It is pursuant to the pleadings before the tribunal and in the
course of enquiry, the 1st claimant was examined as P.W.1 and two more
persons including P.W.2 (so called eye witness to the accident) were
examined and placed reliance on Exs.A.1 to A.15 including First
Information Report, Chargesheet, Inquest report, post mortem report,
M.V.I. report, rough sketch, employment certificate, pay slip, salary
sheet, SSC and decree with provisional certificates, marriage certificate
driving licence and Insurance policy.
6. Basing on said oral and documentary evidence and on hearing
both sides, the tribunal in awarding compensation with interest referred
supra, observed that P.W.2 eye witness in the cross-examination stated
the road was busy road and the accident was taken place at the turning
point and the deceased was proceeding on straight road at 40 kms speed
and to take right turn the vehicle must go slow and by taking right turn
the car was not called proceeding in wrong route, he did not state
before police that the car was in wrong side; for R.W.1 to say the
accident was due to negligence of deceased admittedly he has no
personal knowledge and R.W.2 other witness deposed that he cannot say
whether the car dashed the two wheeler or vice-versa as the occurrence
was in seconds of time and he cannot say who was at fault. The M.V.I.
report is with the opinion that the accident was not due to any
mechanical defects of the car. The rough sketch shows the scene of
offence is at one corner of the four road junction and the car was taking
right turn from Vijayapuri colony towards Vaidehinagar road where the
accident occurred near junction from both the vehicles colluded due to
negligence of drivers of both the vehicles. The tribunal therefrom held
that the deceased-bike rider also contributed to the accident apart from
the negligence of the car driver. While assessing the earnings of
deceased, the tribunal observed in arriving just compensation that the
deceased was working as Assistant Manager in Human Fullerton India
Credit Company Limited, Hyderabad since 23.08.2013 and he was
undergoing probation by the date of accident 19.11.2013 and his net
salary is Rs.34,468/- and his salary includes conveyance of Rs.8,800/-,
H.R.A. of Rs.4,800/- besides personal allowance of Rs.18,400/- that are
reflecting from Exs.A.7to A.9 pay slip, salary sheet and employment
certificate and from the net salary supra, by applying multiplier 16 from
the age of the deceased by 1/3rd deduction towards personal expenses,
arrived at Rs.44,11,904/-(Rupees forty four lakhs eleven thousands nine
hundred and four only) and 50% negligence of the deceased by deducting
therefrom and adding 50% towards future prospects to the earning, the
tribunal arrived at Rs.33,10,928/- besides Rs.1,00,000/- towards loss of
consortium to 1st claimant-wife, Rs.5,000/- towards funeral expenses,
Rs.5,000/- towards loss of estate and Rs.25,000/- towards love and
affection to the minor child, in all total of Rs.34,45,928/- rounded to
Rs.34,50,000/- was awarded.
7. It is impugning the same in the present appeal is filed, the
counsel for the appellant-Insurer in support of the grounds of appeal,
before admission of the appeal contended that the trial Court gravely
erred in finding composite negligence of deceased rider of the bike vis-
-vis the driver of the car instead of holding the deceased was alone
negligent and liable for the accident that too, in proceeding at about 40
kms speed on the road and taking right turn by the driver of the car was
not on wrong side even as per P.W.2 eye witness to the accident, that
the tribunal also gravely erred in arriving the net salary of Rs.34,468/-
without deduction of personal expenses of Rs.18,400/- besides
conveyance allowance of Rs.800/- and the compensation awarded is
highly excessive, so also in taking 50% future prospects even the
deceased was only a probationer in the private job and that the rate of
interest awarded at 12% p.a. is also unsustainable and the award of the
tribunal thereby is liable to be set aside.
8. Heard the learned standing counsel for the appellant-Insurer
before admission of the appeal and perused the material also by
securing the original record of the tribunal and the decisions placed
reliance, in deciding whether there are any grounds to admit the appeal
either on the quantum of compensation including with reference to the
earnings and permissible deductions and prospective increase or on rate
of interest awarded or on the finding of the negligence as arrived by the
tribunal to interfere.
9. Coming to the manner of accident, as per Ex.A1 FIR in Cr.
No.882/2013, on the report of one Golla Ramesh, dt.20-11-2013 at 0.45
hours, that on the motor cycle AP 29 UB T/R.2696 of Ravula Prakash, his
brother-in-law Sadhu Santosh (deceased) at about 11.45 p.m of dated
19-11-2013 ( within 2 hours of the occurrence the report was given and
FIR was registered) was while proceeding from B.N.Reddy Nagar to
Vijayapuri Colony towards his house, at Videhinagar, near Abhimanyu
Bar, the driver of Car AP 015 TV 3065 by rash and negligent driving
coming in wrong route in opposite direction to the motor cyclist supra,
dashed the motor cycle and as a result, the motor cyclist sustained
bleeding injuries and when taken in 108 ambulance to Kamineni
hospital, he was declared died, hence to take action against the car
driver. The police after investigation filed the Ex.A2 charge sheet
against the car driver by name Kanniganti Ravi@ Ravinder of Karimnagar
district. The Ex.A5 MVI Report column Nos.16 AND 17 speak the driver`s
name supra and also the driving licence particulars of holding valid
driving licence and also the policy particulars of the crime car belongs to
the insured and the appellant herein issued the policy which is in force.
These facts also not in dispute from evidence of Rws1 AND 2 or from cross
examination of PW1 AND 2 with reference to the Ex.A5 MVI Report and Ex.B1
policy. The Ex.A5 MVI Report column No.19 speaks no mechanical
defects to the car in resulting the accident. The Ex.A4 PM Report speaks
multiple external and internal injuries with diffuse subdural hemorrhage
and injury to brain and the cause of death was due to the head injury.
The Ex.A2 charge sheet also refers Doddi Ramesh-PW2 as eye witness to
the accident. Doddi Ramesh-PW2 deposed in his chief affidavit evidence
that, the deceased was proceeding on the motor cycle on correct side of
the road and while approaching near Abhimanyu Bar at Vaidehi Nagar,
the driver of the Maruti Swift Car driving in a rash and negligent manner
on wrong side of the road dashed the motor cyclist proceeding in
opposite direction and the said motor cyclist sustained multiple injuries
including head injury and was shifted to Kamineni Hospital, Hyderabad
and in the way he breathed the last and the accident was due to rash
and negligent driving of the driver of the car and he stated the same
before police during investigation. He is aged about 25 years, a private
employee and resident of Vaidehi Nagar. In the cross-examination he
deposed that he did not report to the police of what he witnessed the
accident. He deposed that the car was proceeding from Vijayapuri
colony to Vaidehi Nagar and the deceased was on the motor cycle
proceeding from B.N.Reddy Nagar to Vijayapuri colony and to go to
Vaidehi Nagar, Road No.12, from Vijayapuri colony, there is a right turn
and the place of accident was at the turning point and it was a busy
road. It is true the vehicle go straight road was at speed. It is true the
deceased was proceeding on the straight road at 40kms speed to take
right turn the vehicle has to go slow. He denied the suggestion of no
rash or negligence driving on the part of the car driver while taking right
turn and the negligence is of the deceased -bike rider only while
proceeding on the straight road. He deposed the car taking right turn
was not called as wrong route, however, he adds that the vehicle was
taking right turn instead of going middle of the road took turn very near
to the corner and dragged the motor cyclist and denied the suggestion of
the deceased was in a drunken state and could not control the motor
cycle and was instrumental for the accident or the car while taking right
turn was operating right indicator. He deposed that in his chief affidavit
he stated that the car was on the wrong side, which he did not state
before the police. The law is fairly settled that evidence of a witness is
to be read as a whole and no any stray sentence can be taken to say as
any admission. To consider as admission, it must be clear from the
entire reading of the evidence and not from pick and choose of any
sentence alone without reading and understanding on what context the
witness so deposed. From said deposition of P.W.2, there is nothing to
say the deceased bike rider was proceeding rashly and negligently or
even on wrong side but for the car driver proceeding on wrong side and
in rash and negligent manner from entire reading of the evidence. What
he deposed of in the straight road the deceased was proceeding on his
bike at an estimated speed of 40 kms., does not mean even at the place
of accident the same speed continued. From the MVI report, there is, as
per column No.8, car bumper damaged at right side so also right fog
light and right head light and there is a scratch on the bonnet and front
side number plate damaged. What P.W.2 deposed in his cross-
examination in support of it is that the car was taking right turn instead
of going middle of the road took turn very near to the corner and
dragged the motor cyclist. In fact, a perusal of Ex.A.6 rough sketch
clearly speaks the car was from Vijayapuri colony proceeding on wrong
side from east to west to say it was on the right side of the road instead
of left side of the road. In fact, the deceased from B.N.Reddy Nagar to
Vijayapuri colony in the straight road proceeding on the left side of the
road and was not at all on wrong side, that too, after crossing the four
road junction by the bike rider proceeding at left side, the accident
occurred. If really, the car driver was by giving signal lights to take right
curve towards north and the bike rider is at fault, the damage must be
to the car left side. Whereas, the M.V.I. report clearly speaks from the
damage to the car only on right side fog light and right side head light
and dent of the bumper at right side and scratch at right side. It clearly
shows while bike was proceeding on left side of the road, the car driver
taken suddenly the right turn uncaring of the bike rider proceeding while
negotiating the right turn that resulted the accident. Thus, it is difficult
to say there is any negligence on the part of the deceased much less for
the tribunal to find equal negligence as equal contributor to the
accident. On value of scene observation sketch, in APSRTC Vs., D.Sasi
Kala it was held that Panchanama and rough sketch of the scene are
important in proof of actual occurrence to assist the tribunal rather than
relying on charge sheet contents as basis. In Jiju Kuruvila Vs.
Kunjujamma Mohan (2JB), It was held that where eye witness in
support of the claim deposed that bus hit the car while both vehicles
were proceeding in opposite direction, due to rash and negligent driving
of the bus driver against whom FIR also lodged and police after
investigation filed charge sheet, when neither owner of the bus nor
driver of the bus denied the manner of accident before the tribunal
much less coming to witness box, insurance company of bus relying on
the P.M. report contended that the accident was occurred due to
negligent driving of the car driver-deceased who were under
intoxication, when scene mahazar does not suggest any negligence of
deceased car driver, the P.M. report even suggests the deceased car
driver has taken liquor, there is no basis to give any finding of deceased
was driving the car rashly and negligently much less to belie the direct
evidence of eye witness and FIR, charge sheet and scene mahazar and
thereby held by the Apex Court that the tribunal went wrong in fixing
liability of drivers of bus and car at 75% and 25% contribution and
equally by the High Court in modified to 50% each in ultimately holding
by the Apex Court of no negligence of the deceased car driver but for
sole negligence of the bus driver in holding the owner and Insurer of the
bus to be made liable to pay compensation.
10. Having regard to the above, this Court can hold unhesitatingly
that the tribunal went wrong in saying there is equal contribution of the
car driver and the bike rider(deceased) for the result of the accident,
though the facts of the case on hand clearly proves the car driver alone
is at fault and the deceased bike driver is not at fault and there is
nothing to prove any contribution by him to the result of the accident,
but for of the Maruti car driver of the Insured to be made liable to
indemnify by the appellant-Insurer to satisfy the claim.
11. The appellate Court in this regard undoubtedly and within its
powers under Order XLI Rule 22 and 33 CPC can interfere with the
finding of the tribunal on its correctness, for entire matter is at large
with no need of any cross-objections of opposite side much less even for
admitting an appeal from the perusal of merits as to prima facie case to
admit or not, as the provisions of Order XLI CPC equally applicable to
the appeal against a Motor Accidents Claim. In this regard, the Apex
Court in Ranjana Prakash Vs. Divisional Manager held as follows:-
"8. Where an appeal is filed challenging the quantum of
compensation, irrespective of who files the appeal, the
appropriate course for the High Court is to examine the facts
and by applying the relevant principles, determine the just
compensation. If the compensation determined by it is higher
than the compensation awarded by the Tribunal, the High
Court will allow the appeal, if it is by the claimants and
dismiss the appeal, if it is by the owner/insurer. Similarly, if
the compensation determined by the High Court is lesser than
the compensation awarded by the Tribunal, the High Court
will dismiss any appeal by the claimants for enhancement, but
allow any appeal by owner/insurer for reduction. The High
Court cannot obviously increase the compensation in an
appeal by owner/insurer for reducing the compensation, nor
can it reduce the compensation in an appeal by claimants
seeking enhancement of compensation."
12. From the above, for no dispute on the maintainability of the
appeal u/sec. 173 of the M.V.Act, against the award of the tribunal by
the Insurance company, coming to the driver of the car a necessary
party raised in the appeal arguments for the first time by the appellant
in impugning the award of the tribunal, by placed reliance upon OIC Ltd.
Vs. Meena Variyal (2JB), same cannot be permitted to raise from the
doctrine of waiver for not raised either in the counter before the
tribunal or even in the evidence before the tribunal or not even in the
grounds of appeal before this Court in the factual matrix of the case
though in Meena Variyal supra it was held in a claim u/sec. 166
M.V.Act, the tribunal ought to have insisted that driver be impleaded.
Even coming to the proof regarding the earnings of the deceased from
the expression speaks that the claimant should have been asked to
produce rather oral evidence the documentary evidence regarding the
salary of the deceased in a private limited company, in the case on
hand, Exs.A.7 to A.9 filed through P.W.1 and proved through P.W.3 and
same could not be rebutted from the onus shifts, but for a stray
suggestion as created that could not be said discharge of the onus much
less disproving said evidence.
13. Coming to decide what is the just compensation in the factual
matrix of the case the claimants are entitled and the compensation
arrived by the tribunal is excessive to reduce or not concerned, it is apt
to state that perfect compensation is hardly possible and money cannot
renew a physique or frame that has been battered and shattered, nor
relieve from a pain suffered as stated by Lord Morris. In Ward v.
James , it was observed by Lord Denning that award of damages in
personal injury cases is basically a conventional figure derived from
experience and from awards in comparable cases. Thus, in a case
involving loss of limb or its permanent inability or impairment, it is
difficult to say with precise certainty as to what composition would be
adequate to sufferer. The reason is that the loss of a human limb or its
permanent impairment cannot be measured or converted in terms of
money. The object is to mitigate hardship that has been caused to the
victim or his or her legal representatives due to sudden demise.
Compensation awarded should not be inadequate and neither be
unreasonable, excessive nor deficient. There can be no exact uniform
rule in measuring the value of human life or limb or sufferance and the
measure of damage cannot be arrived at, by precise mathematical
calculation, but amount recoverable depends on facts and circumstances
of each case. Upjohn LJ in Charle Red House Credit v. Tolly remarked
that the assessment of damages has never been an exact science and it
is essentially practical. Lord Morris in Parry v. Cleaver observed that to
compensate in money for pain and for physical consequences is
invariably difficult without some guess work but no other process can be
devised than that of making a monitory assessment though it is
impossible to equate the money with the human sufferings or personal
deprivations. The Apex Court in R.D.Hattangadi v. Pest Control (India)
Private Limited at paragraph No.12 held that in its very nature
whatever a Tribunal or a Court is to fix the amount of compensation in
cases of accident, it involves some guess work, some hypothetical
consideration, some amount of sympathy linked with the nature of the
disability caused. But all the aforesaid elements have to be viewed with
objective standard. Thus, in most of the cases involving Motor Accidents,
by looking at the totality of the circumstances, an inference may have to
be drawn and a guess work has to be made even regarding compensation
in case of death, for loss of dependency and estate to all claimants;
care, guidance, love and affection especially of the minor children,
consortium to the spouse, expenditure incurred in transport and funerals
etc., and in case of injured from the nature of injuries, pain and
sufferance, loss of earnings particularly for any disability and also
probable expenditure that has to be incurred from nature of injuries
sustained and nature of treatment required. In Helen C. Rebello Vs.
MSRTC the Apex Court (2JB) observed that the word 'just' in the
phrase 'just compensation' denotes equitability, fairness, and
reasonable having large peripheral field. On facts in Helen C. Rebello it
was observed that amount received under LIC policy of deceased not
liable to be deducted from computation of compensation under the
M.V.Act, for the same is contractual and payable for any type of death
whereas the motor accident claim compensation is the statutory liability
for the accidental death. In Asha Vs. UIIC Ltd., (2JB) it was observed
that the claimants are entitled to be compensated for the loss suffered
by them to say which is the amount which they would have been
receiving at the time when the deceased was alive. In NIAC Ltd Vs.
Charlie it was observed referring to UPSRTC Vs. Trilokchand (3JB),
G.M. KSRTC Vs. Sushama Thomus MCD Vs. Subhagwanthi and
Davies Vs. Powell DAC Limited in a fatal accident action, the
accepted measure of damages awarded to the defendants is the
pecuniary loss suffered and is likely to be suffered by each of them as a
result of the death. In TN Transport Corporation v. Raja Priya (2JB)
the above expressions of Charlie, Trilokchand, Sushama Thomus and
those referred therein were referred to the same conclusion on
determination of compensation in a death claim and further on the rate
of interest by considering the prevailing rate of interest in bank deposits
and steep fall in the bank lending rate, it was reduced from 9% awarded
by the tribunal and affirmed by the High Court to 7.5% p.a. as just and
reasonable within the judicial discretion to reduce by sitting in appeal
against. In NICL Vs. Indira Srivastava (2JB) it was held referring to
Helen C. Rebello and other expressions including Asha supra, in
explaining the meaning of the words income and just compensation used
in Section 168 of the M.V.Act, to decide depending on facts and
circumstances of each case that the compensation to be awarded is just
and equitable rather than a bonanza or source of profit, as
compensation is equivalent for loss sustained in terms of money to be
estimated. Income of a private sector employee with no pension, not
confined to pay packet only as it includes benefits and perks meant for
family as distinguished from personal benefits like conveyance allowance
etc., that also though form part of income for tax, however, the tax
payable has to be deducted. It was also observed the income for
consideration under the section is different from the income taxable or
not under the I.T.Act. It also observed referring to single judge
expression of this Court in S.Narayanamma Vs. Secretary to Govt. of
India (MOT) that allowances like travelling allowance, newspaper, club
fees, car maintenance, telephone, servant, need not be included in the
earnings of the deceased in computing the dependency. In Syed Basheer
Ahamed Vs. Mohd.Jameel it was held referring to Sushama Thomus
and Indira Srivastava among others supra that just compensation vests
wide discretion in the tribunal though not empowering to determine
arbitrarily by ignoring the settled principles as it is to be fair and
reasonable by accepted legal standards in the claim made u/sec.166 of
the M.V.Act, no doubt, same is beset with difficulties in taking into
accounts many imponderables and for accurately cannot be ascertained
without involving an element of estimation or conjecture even in
arriving the estimated income. There on facts of deceased a
businessman from the earnings claimed with reference to income returns
however, for future prospects shown from account books held no reliable
evidence of future plans expansion or diversification to get further
income to consider. The other decision placed reliance is Sarla Verma
v. Delhi Transport Corporation In fact, in Sarla Verma supra, it was
observed that where the annual income is in the taxable range, the
words "actual salary" should be read as "actual salary less tax in
arriving the income to determine the compensation and even to the
future prospects determination as a rule of thumb laid down therein.
Relying on Sarla Verma supra in Reshma Kumari v. Madan Mohan
(3JB) it was observed from para 29 onwards as follows:-
29. Section 168 of the 1988 Act provides the guideline
that the amount of compensation shall be awarded by the
claims tribunal which appears to it to be just. The
expression, 'just' means that the amount so determined is
fair, reasonable and equitable by accepted legal standards
and not a forensic lottery. Obviously 'just compensation'
does not mean 'perfect' or 'absolute' compensation. The
just compensation principle requires examination of the
particular situation obtaining uniquely in an individual case.
30. Almost a century back in Taff Vale Railway Co.
v. Jenkins (1913-AC 1), the House of Lords laid down the
test that award of damages in fatal accident action is
compensation for the reasonable expectation of pecuniary
benefit by the deceased's family. The purpose of award of
compensation is to put the dependants of the deceased,
who had been bread-winner of the family, in the same
position financially as if he had lived his natural span of
life; it is not designed to put the claimants in a better
financial position in which they would otherwise have
been if the accident had not occurred. At the same time,
the determination of compensation is not an exact science
and the exercise involves an assessment based on
estimation and conjectures here and there as many
imponderable factors and unpredictable contingencies
have to be taken into consideration.
31. This Court in C.K. Subramanian Iyer and Ors. v.
T.Kunhikuttan Nair and Others-(1970 (2) SCR 688), reiterated
the legal philosophy highlighted in Taff Vale Railway(supra)
for award of compensation in claim cases and said that there
is no exact uniform rule for measuring the value of the
human life and the measure of damages cannot be arrived at
by precise mathematical calculations. Obviously, award of
damages in each case would depend on the particular facts
and circumstances of the case but the element of fairness
in the amount of compensation so determined is the
ultimate guiding factor.
32. In Susamma Thomas, this Court - though with
reference to Section 110 B of the Motor Vehicles Act, 1939 -
stated that the multiplier method was the accepted norm of
ensuring the just compensation which will make for
uniformity and certainty of the awards. We are of the
opinion that this statement in Susamma Thomas is equally
applicable to the fatal accident claims made under Section
166 of the Act, 1988. In our view, the determination of
compensation based on multiplier method is the best
available means and the most satisfactory method and must
be followed invariably by the Tribunals and Courts.
33. We have already noticed the table prepared in
Sarla Verma for the selection of multiplier. The table has
been prepared in Sarla Verma having regard to the three
decisions of this Court, namely, Susamma Thomas, Trilok
Chandra and Charlie for the claims made under Section 166
of the 1988 Act. The Court said that multiplier shown in
Column(4) of the table must be used having regard to the
age of the deceased. Perhaps the biggest advantage by
employing the table prepared in Sarla Verma is that the
uniformity and consistency in selection of the multiplier
can be achieved. The assessment of extent of
dependency depends on examination of the unique
situation of the individual case. Valuing the dependency
or the multiplicand is to some extent an arithmetical
exercise. The multiplicand is normally based on the net
annual value of the dependency on the date of the
deceased's death. Once the net annual loss (multiplicand)
is assessed, taking into account the age of the deceased,
such amount is to be multiplied by a 'multiplier' to arrive
at the loss of dependency. In Sarla Verma this Court has
endeavoured to simplify the otherwise complex exercise
of assessment of loss of dependency and determination of
compensation in a claim made under Section 166. It has
been rightly stated in Sarla Verma that claimants in case of
death claim for the purposes of compensation must establish
(a) age of the deceased; (b) income of the deceased; and (c)
the number of dependants. To arrive at the loss of
dependency, the Tribunal must consider (i)
additions/deductions to be made for arriving at the income;
(ii) the deductions to be made onwards the personal living
expenses of the deceased; and (iii) the multiplier to be
applied with reference to the age of the deceased. We do
not think it is necessary for us to revisit the law on the point
as we are in full agreement with the view in Sarla Verma.
34. If the multiplier as indicated in Column (4) of the
table read with paragraph 42 of the Report in Sarla Verma is
followed, the wide variations in the selection of multiplier in
the claims of compensation in fatal accident cases can be
avoided. A standard method for selection of multiplier is
surely better than a criss-cross of varying methods. It is high
time that we move to a standard method of selection of
multiplier, income for future prospects and deduction for
personal and living expenses. The courts in some of the
overseas jurisdictions have made this advance. It is for these
reasons; we think we must approve the table in Sarla Verma
for the selection of multiplier in claim applications made
under Section 166 in the cases of death. We do accordingly.
If for the selection of multiplier, Column (4) of the table in
Sarla Verma17 is followed, there is no likelihood of the
claimants who have chosen to apply under Section 166 being
awarded lesser amount on proof of negligence on the part of
the driver of the motor vehicle than those who prefer to
apply under Section 163A. As regards the cases where the
age of the VICTIM happens to be up to 15 years, we are of
the considered opinion that, in such cases irrespective of
Section 163A or Section 166 under which the claim for
compensation has been made, multiplier of 15 and the
assessment as indicated in the Second Schedule subject to
correction as pointed out in Column (6) of the table in Sarla
Verma should be followed. This is to ensure that claimants in
such cases are not awarded lesser amount when the
application is made under Section 166 of the 1988 Act. In all
other cases of death where the application has been made
under Section 166, the multiplier as indicated in Column (4)
of the table in Sarla Verma should be followed.
35. With regard to the addition to income for
future prospects, in Sarla Verma, this Court has noted
earlier decisions in Susamma Thomas, Sarla Dixit and
Abati Bezbaruah and in paragraph 24 held as under:
"24.......In view of the imponderables and
uncertainties, we are in favour of adopting as a rule of
thumb, an addition of 50% of actual salary to the actual
salary income of the deceased towards future prospects,
where the deceased had a permanent job and was below 40
years. (Where the annual income is in the taxable range,
the words "actual salary" should be read as "actual
salary less tax"). The addition should be only 30% if the
age of the deceased was 40 to 50 years. There should be no
addition, where the age of the deceased is more than 50
years. Though the evidence may indicate a different
percentage of increase, it is necessary to standardise the
addition to avoid different yardsticks being applied or
different methods of calculation being adopted. Where the
deceased was self-employed or was on a fixed salary
(without provision for annual increments, etc.), the courts
will usually take only the actual income at the time of
death. A departure therefrom should be made only in rare
and exceptional cases involving special circumstances."
37. As regards deduction for personal and living
expenses, in Sarla Verma, this Court considered Susamma
Thomas, Trilok Chandra and Fakeerappa and finally in
paras 30, 31 and 32 held as under:
"30.......Having considered several subsequent
decisions of this Court, we are of the view that where the
deceased was married, the deduction towards personal
and living expenses of the deceased, should be one-third
(1/3rd) where the number of dependent family members
is 2 to 3; one-fourth (1/4th) where the number of
dependent family members is 4 to 6; and one-fifth (1/5th)
where the number of dependent family members exceeds
six.
31. Where the deceased was a bachelor and the
claimants are the parents, the deduction follows a different
principle. In regard to bachelors, normally, 50% is deducted
as personal and living expenses, because it is assumed that a
bachelor would tend to spend more on himself. Even
otherwise, there is also the possibility of his getting married
in a short time, in which event the contribution to the
parent(s) and siblings is likely to be cut drastically. Further,
subject to evidence to the contrary, the father is likely to
have his own income and will not be considered as a
dependant and the mother alone will be considered as a
dependant. In the absence of evidence to the contrary,
brothers and sisters will not be considered as dependants,
because they will either be independent and earning, or
married, or be dependent on the father. 32. Thus
even if the deceased is survived by parents and siblings, only
the mother would be considered to be a dependant, and 50%
would be treated as the personal and living expenses of the
bachelor and 50% as the contribution to the family.
However, where the family of the bachelor is large and
dependent on the income of the (Fakeerappa and Anr. v.
Karnataka Cement Pipe Factory and Others; [(2004) 2 SCC
473]) deceased, as in a case where he has a widowed mother
and large number of younger non-earning sisters or brothers,
his personal and living expenses may be restricted to one-
third and contribution to the family will be taken as two-
third."
38. The above does provide guidance for the
appropriate deduction for personal and living expenses. One
must bear in mind that the proportion of a man's net
earnings that he saves or spends exclusively for the
maintenance of others does not form part of his living
expenses, but what he spends exclusively on himself does.
The percentage of deduction on account of personal and
living expenses may vary with reference to the number of
dependant members in the family and the personal living
expenses of the deceased need not exactly correspond to
the number of dependants.
39. In our view, the standards fixed by this Court in
Sarla Verma on the aspect of deduction for personal living
expenses in paragraphs 30, 31 and 32 must ordinarily be
followed unless a case for departure in the circumstances
noted in the preceding para is made out.
14. The expression in Sarla Verma is quoted with approval also by
the subsequent three Judge Bench expression in Rajesh Vs. Rajbir
Singh (where Reshma Kumari was no doubt not referred) in saying the
proposition of future prospects increase applies not only in case of
regular employees but also in case of self-employed persons and persons
with fixed wages, where also the actual income must be enhanced for
the purpose of computation of compensation by 50% where the age of
the victim is below 40 years.
15. Keeping the above principles in mind, coming to the earnings
of the deceased and what amount out of it to be deducted and what
amount to be taken into consideration towards loss of contribution to
the claimants from the sudden accidental death, where the annual
income is in the taxable range, the words "actual salary" should be read
as "actual salary less tax; from the deceased was aged 32 years as per
Ex.A.4 P.M. Report and as per Ex.A.11 driving licence, the deceased was
born on 30.07.1982 and the Ex.A.10 SSC certificate of the deceased also
proves the same to say as on date of accident 19.11.2003, he completed
31 years. The deceased was a post-graduate in Applied Science as per
Ex.A.13 and 15 from Periyar University and passed in distinction in the
year 2004 and those are the copies of provisional and regular P.G.Degree
certificates to that effect. As the claim is under Section 166 of the Act,
as per Sarla Verma, Reshmakumari and Rajesh the multiplier that is
applicable is 16 for persons in the age group of 31 to 35 years. The
tribunal rightly has taken the multiplier 16. Coming to earnings for
consideration and personal expenses deduction out of it, the evidence of
P.W.3 who is the Manager(Legal)of Fullerton Indian Private Limited,
Hyderabad branch where the deceased was working as H.R. Assistant
Manager, since 23.08.2013 (even by the date of accidental death on
19/20.11.2013) as per Ex.A.7 as probationer to say undergoing probation
still. Merely because he is in probation, does not mean he was not in
employment with monthly salary to be computed for assessing
compensation as on the date and time of death. As per Section 2(22) of
the Income Tax Act, 1961(for short, 'the IT Act') income is an inclusive
definition which includes any special allowance and benefit granted to
the assessee (employee) other than perks to meet expenses for
performance of duties or as employment of profit or to compensate for
increase in the cost of living or value of any benefit or perquisite.
16. As per Section 17(2) in Chapter 4 of the I.T.Act, in
computation of the income under the Head Salaries perquisite includes
value of rent free accommodation provided by the employer or value of
any rent concession in respect of the accommodation provided by the
employer. Salary includes the pay, allowances, bonus or commission
payable monthly or otherwise or any monetary payments, by whatever
name called, but does not include D.A. or D.P. unless it enters into the
computation of superannuation or retirement benefits, employer's
contribution to P.F., allowances exempted from payment of tax, value
of perks specified and any payment or expenditure specially excluded.
17. When such is the case, as per Ex.A.8 the salary statement, his
gross salary was Rs.37,125/-p.m. comprising of basic of Rs.13,125/-, HRA
of Rs.4,800/-, Personal Allowance of Rs.18,400/- and Conveyance
Allowance of Rs.800/- and out of it, the deductions are IT deduction of
Rs.438/-, P.F. of Rs.1575/-, Professional Tax of Rs.200/-and Mediclaim
recovery of Rs.444/-and the net salary thereby is Rs.34,468/-Ex.A.9
Salary sheet also proved through P.W.3 for the total three months period
from 23.08.2013 to 19.11.2013 in this regard. P.W.3 denied the
suggestion of deceased never worked in the entity and Exs.A.7 to A.9 are
created or he was not paid any salary by the entity or he is deposing
false. There is no other much less worth cross-examination to discredit
the evidence of P.W.3 or to doubt the probative value of the Exs.A.7 to
A.9. From the above, out of the gross salary of the deceased proved of
Rs.37,125/-p.m. comprising of basic of Rs.13,125/-, HRA of Rs.4,800/-,
Personal Allowance of Rs.18,400/- and Conveyance Allowance of
Rs.800/- and out of it the deductions are IT deduction of Rs.438/-, P.F.
of Rs.1575/-, Professional Tax of Rs.200/-and Mediclaim recovery of
Rs.444/-in showing the net salary as Rs.34,468/-; the Conveyance
Allowance of Rs.800/-, IT deduction of Rs.438/-, P.F. contribution of
Rs.1575/-, Professional Tax of Rs.200/-and Mediclaim recovery of
Rs.444/-even deducted in arriving the net amount thereafter, for the
HRA not liable for deduction as it is not confined to the personal benefit
of deceased but for the whole family of the deceased who are the
claimants. Further, even it is shown in the pay band as Personal
Allowance for a sum of Rs.18,400/-, it is not for any specific personal
meeting of requirement like tour travel etc., to personally benefit the
employee but for part of the earnings of the deceased to contribute to
the family even out of it after meeting the personal expenses deduction
of 1/3rd or 1/4th, as the case may be. Coming to personal expenses
deduction, out of the 4 claimants, the father is a retired employee and
pensioner and contended as not dependent solely on the deceased.
Even the father is not solely dependent, there could be some
contribution to him by the deceased out of his earnings for what he gets
pension or other retirement benefits is not only to him but also to his
wife and any other family members and that may or may not be
sufficient for his survival. What is laid down in Sarla Verma in arriving
personal expenses deduction of deceased depending upon number of
dependents, even father therefrom not taken as a dependent but for the
other three, as per paras 30 to 33 of the expression, which are
reiterated in Reshma Kumari as referred supra, if 1/3rd deducted
towards personal expenses of the deceased, the contribution of the
deceased to the family is the remaining 2/3rds which comes to
(Rs.37,125- Conveyance Allowance of Rs.800 PLUS IT deduction of Rs.438 PLUS P.F.
contribution of Rs.1575 PLUS Professional Tax of Rs.200 PLUS Mediclaim recovery
of Rs.444=Rs.34,468/-is the net salary as arrived by the tribunal and
even instead of Rs.438/- if at least 12% deducted towards income tax,
after 50% prospective increase on Rs.34,468 PLUS Rs.438=Rs.52,359/-, of
which 12% towards income tax deduction taken at Rs.6,283/-, the net
amount comes to Rs.46,076/- and after 1/3rd deduction, the 2/3rds
comes to Rs.30,717/- x 12x16=Rs.58,97,718/-, besides loss of consortium
to the first claimant-wife Rs.1,00,000/-, loss of estate Rs.10,000/-, care
and guidance to the minor child Rs.25,000/- even as awarded by the
tribunal taken, funeral expenses Rs.25,000/- as laid down in Rajesh
supra, it comes to more than what the tribunal awarded of
Rs.34,50,000/-. Thus, as held in Ranjana Prakash supra, this Court has
since no power to enhance for what is awarded is no way excessive but
low, there is nothing to reduce the quantum of compensation awarded
by the tribunal of Rs.34,50,000/-.
18. Coming to the rate of interest, the interest at 12% per annum
from the date of claim petition till date of award and later at 6% p.a. till
date of realisation awarded by the Tribunal is concerned, though rate of
interest to be awarded in a given case is within the discretion of the
tribunal, but the said discretion has to be exercised justly and a
reasonable rate should be awarded, the appellate Court can interfere
with the same to modify it to a reasonable rate. The Court has to take
judicial notice of the facts that, nationalized banks are not offering
interest at 9%p.a. even long term F.D.Rs now-a-days. From the settled
propositions of law including from the settled expression of the Apex
Court in Raja Priya supra taking note of steep fall in bank lending rates
in the recent past, the interest is awarded at 9%p.a. was reduced to
7.5%p.a. as just and reasonable; though in Sarla Verma v. Delhi
Transport Corporation interest awarded is only at 6%p.a. and in the
latest expression of the three judge Bench of the Apex Court in Rajesh
v. Rajbir Singh , it is held categorically that it is reasonable to award
rate of interest at 7.5% p.a. Hence, the rate of interest is modified to
71/2% p.a. uniformly from date of claim petition till realisation instead of
12% p.a. from date of claim petition till date of award and thereafter 6%
p.a. till realization as awarded by the Tribunal.
19. Accordingly and in the result, the appeal is disposed of before
admission while setting aside the finding of the tribunal on contributory
negligence of deceased and car driver equally and held the accident was
the result of only due to the rash and negligent driving of car driver
however, by not interfering with the quantum of compensation awarded
by the tribunal for same is no way excessive, but for modifying the rate
of interest from 12%p.a.from the date of the claim petition filed before
the tribunal till date of award and thereafter at 6% p.a. till realization,
to 7.5% p.a. from date of claim petition till realization uniformly. Rest
of the award holds good. There is no order as to costs. Consequently,
miscellaneous petitions, if any, pending in this appeal shall stand closed.
____________________________________________________________
JUSTICE NOOTY RAMAMOHANA RAO
_________________________________________________________
Dr. JUSTICE B.SIVA SANKARA RAO
Date:13.04.2016
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