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Supreme Court of India
National Insurance Co.Ltd vs Kusuma & Anr on 23 August, 2011
Author: D Jain
Bench: D.K. Jain, R.M. Lodha
                                                                                               REPORTABLE

                        IN THE SUPREME COURT OF INDIA


                         CIVIL APPELLATE JURISDICTION


                  CIVIL APPEAL NO.      7212               OF 2011

                     (Arising out of S.L.P. (C) No.17905 of 2008)




NATIONAL INSURANCE COMPANY LTD.                                 --      APPELLANT


                                           VERSUS


KUSUMA & ANR.                                                  --       RESPONDENTS





                                    J U D G M E N T

D.K. JAIN, J.:

1. Leave granted.

2. Challenge in this appeal, by special leave, is to the legality and

validity of the judgment and order dated 17th January, 2008, delivered

by the High Court of Karnataka at Bangalore, whereby the High Court

has allowed the appeal preferred by respondent No.1 herein,

enhancing the compensation awarded to her by the Motor Accident

Claims Tribunal (for short “the Tribunal”) constituted under the Motor

Vehicles Act, 1988 (for short “the Act”) to `1,80,000/- along with

interest @ 6% per annum.

3. To appreciate the controversy, the factual matrix in a nutshell is as

under :

On 28th June 1995, the car in which Mrs. Kusuma, respondent No.1

in this appeal (hereinafter referred to as “the claimant”), aged about 36

years, was travelling from Sullia to Puttur collided with a Bus owned by

Karnataka State Road Transport Corporation, respondent No.2 herein.

Due to the impact of the accident, the claimant and others sustained

injuries. The claimant, who was 30 weeks pregnant, suffered a fatal blow

on the stomach. She was admitted in the hospital, where an X-ray and

scanning of the foetus showed that the baby had died inside the uterus.

On an induced delivery, the following day she delivered a still born baby.

The claimant filed a claim petition under Section 166 of the Act before

the Tribunal, Mangalore, making a claim of `2,00,000/- with cost and

interest at 12%, towards the expenses incurred on medical treatment,

mental shock, pain and loss of child.

4. The Tribunal vide award dated 5th October 2004, inter alia, held that

loss of foetus on account of injury sustained by the claimant in the

accident was akin to the death of a child of a tender age. Relying on a

decision of the Karnataka High Court, wherein the Court had awarded

a compensation of `25,000/- towards the loss of affection and

`25,000/- towards the loss of estate on the death of a child of less than

2

1 year of age in an accident, the Tribunal allowed the claim in part and

awarded a compensation of an amount of `50,000/- towards the loss of

unborn child and a further sum of `10,000/- towards pain and

sufferings to the claimant, along with an interest @ 6% per annum

from 18th November 1995 i.e. the date of institution of the claim

petition till the date of deposit/payment. The Insurance Company, the

appellant in this appeal, was directed to pay the said compensation to

the claimant, in order to indemnify the owner of the car. Claim

petition against the owner of the Bus was rejected.

5. Dissatisfied with the quantum of compensation awarded by the

Tribunal, the claimant filed an appeal before the High Court, seeking

enhancement of the aforesaid compensation. Pertinently, the

Insurance Company did not question the award.

6. Applying the principle indicated by this Court in New India

Assurance Company Ltd. Vs. Satender & Ors.1, in relation to

assessment of quantum of compensation on the death of a child in an

accident, the High Court, by a short judgment allowed the appeal in

part and enhanced the compensation to a consolidated amount of

`1,80,000/- with interest @ 6% per annum from the date of the petition

till the date of payment.

1 (2006) 13 SCC 60

3

7. Being aggrieved, the Insurance Company is before us in this appeal.

8. At the time of issuing notice to the respondents, at the first blush, it

was felt that the appeal involved a very important question of law,

namely, whether an unborn child (foetus) while still in mother’s womb

can be considered to be a child for the purpose of claiming

compensation under Section 166 of the Act and, therefore, Mr. Uday

U. Lalit, Senior Advocate, was requested to assist the Court as Amicus

Curiae. Accordingly, we heard Mr. Gaurav Aggarwal, learned counsel

appearing for the appellant and the learned Amicus Curiae on the said

issue. However, having closely examined the fact-situation as

emerging from the record, we are convinced that the appellant cannot

be permitted to raise the aforesaid issue. In the present case, having

chosen not to question the correctness of the award made by the

Tribunal, determining the amount of compensation “towards the loss

of unborn child”, the appellant-Insurance Company is now estopped

from contending that an unborn child cannot be considered to be a

child for the purpose of claiming compensation under Section 166 of

the Act. It is manifest from the impugned judgment that the question

for consideration before the High Court in claimant’s appeal was with

regard to the quantum of compensation and not the entitlement of

4

claim for grievous injury to a 30 weeks old child in utero resulting in

the birth of a still born child.

9. Thus, under the given circumstances, the question that survives for our

consideration is whether the quantum of compensation determined by

the High Court, at a lump sum amount of `1,80,000/-, for the loss of

still born child, treating it as a child, and towards pain and sufferings

to the respondent-claimant awarded by the Tribunal at `50,000/- and

`10,000/- respectively, warrants interference by this Court.

10. On receipt of an application for compensation made under Section 166

of the Act, Section 168 of the Act casts an obligation on the Tribunal

to determine the amount of compensation “which appears to it to be

just”. The expression “which appears to it to be just” gives a wide

discretion to the Tribunal to determine the compensation which in the

opinion of the Tribunal is “just”. Explaining the meaning of the word

“just” as appearing in Section 110B of the Motor Vehicles Act, 1939,

which was in pari materia with Section 168 of the Act, this Court in

Helen C. Rebello & Ors. Vs. Maharashtra State Road Transport

Corporation & Anr.2 observed thus :

“The word “just”, as its nomenclature, denotes

equitability, fairness and reasonableness having a large

peripheral field. The largeness is, of course, not

2 (1999) 1 SCC 90

5

arbitrary; it is restricted by the conscience which is fair,

reasonable and equitable, if it exceeds; it is termed as

unfair, unreasonable, unequitable, not just. Thus, this

field of wider discretion of the Tribunal has to be within

the said limitations and the limitations under any

provision of this Act or any other provision having the

force of law.”

11. Thus, the word “just” connotes something which is equitable, fair and

reasonable, conforming to rectitude and justice and not arbitrary. It

may be true that Section 168 of the Act confers a wide discretion on

the Tribunal to determine the amount of compensation but this

discretion is also coupled with a duty to see that this exercise is carried

out rationally and judiciously by accepted legal standards and not

whimsically and arbitrarily, a concept unknown to public law. The

amount of compensation awarded is not expected to be a windfall or

bonanza for the victim or his dependent, as the case may be, but at the

same time it should not be niggardly or a pittance. Thus, determination

of “just” amount of compensation is beset with difficulties, more so

when the deceased happens to be an infant/ child because the future of

a child is full of glorious uncertainties. In the case of death of an infant

many imponderables, like life expectancy of the deceased, his

prospects to earn, save, spend and distribute have to be taken into

account. It is quite possible that there may be no actual pecuniary

benefit which may be derived by his parents during the life time of the

6

child. But at the same time that cannot be a ground to reject the claim

of the parents, albeit they establish that they had reasonable

expectation of pecuniary benefit if the child had lived. The question

whether there exists a reasonable expectation of pecuniary benefit is

always a mixed question of fact and law but a mere speculative

possibility of benefit is not sufficient. In Satender & Ors. (supra),

relied upon by the High Court, while dealing with a claim for

compensation under the Act in relation to the death of a nine year old

child in a truck accident, this Court had observed as follows :

“9. There are some aspects of human life which are

capable of monetary measurement, but the totality of

human life is like the beauty of sunrise or the splendor of

the stars, beyond the reach of monetary tape-measure.

The determination of damages for loss of human life is

an extremely difficult task and it becomes all the more

baffling when the deceased is a child and/or a non-

earning person. The future of a child is uncertain.

Where the deceased was a child, he was earning nothing

but had a prospect to earn. The question of assessment of

compensation, therefore, becomes stiffer. The figure of

compensation in such cases involves a good deal of

guesswork. In cases, where parents are claimants,

relevant factor would be age of parents.”

12.It was further observed that:

“In cases of young children of tender age, in view of

uncertainties abound, neither their income at the time of

death nor the prospects of the future increase in their

income nor chances of advancement of their career are

capable of proper determination on estimated basis. The

reason is that at such an early age, the uncertainties in

7

regard to their academic pursuits, achievements in career

and thereafter advancement in life are so many that

nothing can be assumed with reasonable certainty.

Therefore, neither the income of the deceased child is

capable of assessment on estimated basis nor the

financial loss suffered by the parents is capable of

mathematical computation.”

13. It is quite true, as observed in Satender & Ors. (supra), that the

question of assessment of compensation in a case where the deceased

is an infant involves a good deal of guesswork but in our view it

cannot be a wild guesswork. As aforesaid, some material has to be

adduced by the claimants to prove that they entertained a reasonable

expectation of pecuniary advantage from the deceased. There are quite

a few precedents providing guidelines for determination of

compensation in such cases but because of nature of the order we

propose to pass on facts in hand, we deem it unnecessary to burden the

judgment by making a reference to all these cases, except to note that

in Lata Wadhwa & Ors. Vs. State of Bihar & Ors.3 as also in M.S.

Grewal & Anr. Vs. Deep Chand Sood & Ors.4, wherein a large

number of young school going children had lost their lives,

respectively in fire and by drowning, multiplier method was adopted

and applied for assigning value of future dependency to determine the

quantum of compensation.

3 (2001) 8 SCC 197

4 (2001) 8 SCC 151

8

14. Having examined the instant case on the touchstone of the aforestated

broad principles, we are of the opinion that neither the Tribunal nor

the High Court applied any principle for determination of the amount

of compensation on account of the death of a still born child. It is

clear from a bare reading of the orders of the Tribunal and the High

Court that no reasons have been indicated by the Tribunal while

awarding a lump sum amount of `50,000/- towards the loss of unborn

child and `10,000/- towards pain and suffering to the mother and by

the High Court enhancing the said amounts to a consolidated amount

of `1,80,000/-. Besides, in the impugned judgment, we do not find any

discussion on the question of non-pecuniary compensation awarded by

the Tribunal to the claimant-mother on account of pain and suffering

as a result of death of the child. In the normal course, we would have

remanded the matter back to the Tribunal for fresh consideration.

However, bearing in mind the quantum of compensation awarded by

the courts below and the fact that the accident took place in the year

1995, we are of the opinion that at this juncture it would be too harsh

to direct the claimants to undergo the entire gamut of a fresh exercise

under Section 168 of the Act. Therefore, in the facts and

circumstances of the case, we refrain from interfering with the

impugned judgment and dismiss the appeal accordingly, with no order

as to costs.

9

15.Before concluding, we place on record our appreciation for the

valuable assistance rendered by Mr. Uday U. Lalit, the learned

Amicus Curiae.

…………………………………….

(D.K. JAIN, J.)

……………………………………..

(R.M. LODHA, J.)

NEW DELHI;

AUGUST 23, 2011.

ARS

1


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