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FA/686/2003 14/ 14 JUDGMENT
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
FIRST
APPEAL NO. 686 OF 2003
For
Approval and Signature:
HONOURABLE
MR.JUSTICE A.M.KAPADIA
HONOURABLE
MR.JUSTICE R.H.SHUKLA
======================================
1
Whether
Reporters of Local Papers may be allowed to see the judgment ?
2
To
be referred to the Reporter or not ?
3
Whether
their Lordships wish to see the fair copy of the judgment ?
4
Whether
this case involves a substantial question of law as to the
interpretation of the Constitution of India, 1950 or any order
made thereunder ?
5
Whether
it is to be circulated to the Civil Judge ?
======================================
NATIONAL
INSURANCE CO. LTD. - Appellant(s)
Versus
HANSABEN
LILESHKUMAR PATEL & ORS. - Respondent(s)
======================================Appearance
:
Ms. Megha Jani for
Appellant(s).
Mr. Mehul S. Shah for Respondent(s) : 1 - 4.
None
for Respondent(s) : 5 - 9.
Mr. Shalin Mehta for Respondent(s) :
10.
======================================
CORAM
:
HONOURABLE
MR.JUSTICE A.M.KAPADIA
and
HONOURABLE
MR.JUSTICE R.H.SHUKLA
Date
: 03/07/2008
ORAL
JUDGMENT
(Per
: HONOURABLE MR.JUSTICE R.H.SHUKLA)
The
present appeal has been filed by the appellant-Insurance Company
challenging the judgement and award dated 24th July, 2002
passed in M.A.C.P. No.149 of 1994 by the Motor Accident Claims
Tribunal (Auxiliary), Kachchh at Bhuj (?Sthe Tribunal?? for short),
awarding the compensation to the tune of Rs.9,45,000/- together with
interest at the rate of 9% per annum from the date of the petition
till deposit with proportionate costs to the heirs of the deceased
Lileshkumar Nanalal Patel.
2. The
facts of the case briefly stated that that the deceased Lileshkumar
was a taxi operator and on 2nd January, 1994, he was going
from Bhuj to Dayapar with the car bearing Registration No.
GJ-12-U-1559 with the passengers travelling in the said taxi. The
deceased was driving the taxi on the left side of the road with
moderate speed. When the deceased reached near the Water Supply Tank
between Ravapar and Matana Madh on Bhuj-Lakhpat road, respondent
No.5-original opponent No.1 came with his tanker bearing Registration
No. GJ-12-T-6502 in a rash and negligent manner with full speed. It
was also the case of the claimants that respondent No.5-driver of the
offending tanker lost control over the tanker and it went on the
wrong side of the road and collided with the taxi, resulting into the
unfortunate accident, as a result of which, the deceased sustained
serious injuries and ultimately, succumbed to them. Therefore, the
heirs of the deceased filed M.A.C.P. No.149 of 1994 for the untimely
death of the deceased in the vehicular accident claiming the
compensation of Rs.15 Lakhs.
2.1 It
was contended that at the time of the accident, the deceased was
earning Rs.4,000/- per month by plying the taxi; the deceased was
aged about 27 years and was hale and hearty and therefore, it was
prayed to pass the award of Rs.15 Lakhs together with interest and
costs thereon in favour of the claimants.
2.2 The
opponent-Insurance Company contested the claim petition by filing the
written statement on all counts and denied the factum and manner of
the accident as well as income of the deceased and ultimately, prayed
to dismiss the petition.
2.3 On
basis of the pleadings of the parties, the Tribunal framed the issues
and after considering the oral as well as documentary evidence
adduced and produced by the parties and also considering the
submissions advanced by the learned Advocates appearing for the
parties, the Tribunal came to the conclusion that the accident was
the result of rash and negligent driving on the part of respondent
No.5 (original opponent No.1) ? driver of the offending tanker. The
Tribunal has considered the income of the deceased at Rs.4,000/- and
also for future income for the purpose of dependency benefit, the
datum figure was taken at Rs.6,000/- per month i.e. Rs.72,000/- per
annum. Thereafter, the Tribunal, applying the multiplier of 18,
awarded Rs.12,96,000/- towards dependency benefits, out of which
1/3rd was deducted towards personal expenses. Therefore,
the Tribunal awarded the net dependency benefit available to the
claimants at Rs.8,64,000/-. Further, an amount of Rs.15,000/- towards
pain, shock and suffering, Rs.15,000/- towards loss of estate,
Rs.5,000/- towards funeral ceremony and Rs.46,000/- towards damages
to the taxi were awarded. The Tribunal, therefore, partly allowed the
claim petition awarding Rs.9,45,000/- to the heirs of the deceased.
2.4 It
is this judgement which has been challenged in the present appeal
under the provisions of Section 173 of the Motor Vehicles Act, 1988.
3. Ms.
Megha, Jani, learned Advocate for the appellant, has contended that
the Tribunal has materially erred in appreciating the evidence on
record while arriving at the quantum of compensation and has awarded
the amount of compensation on higher side. She contended that the
Tribunal has erred in considering the prospective income for the
purpose of dependency benefit and/or arriving at the datum figure
and has wrongly taken the income of the deceased at Rs.6,000/- per
month. It has also been contended that the Tribunal has adopted the
multiplier of 18 which is also on higher side. She, therefore,
submitted that the impugned judgement and award accordingly deserves
to be modified.
4. Per
contra Mr. Mehul Shah, learned Advocate for the respondent Nos.1
to 4,original claimants, contended that the impugned judgement and
award does not call for any interference of this Court as the
Tribunal has rightly arrived at the dependency benefit considering
the future prospective income of the deceased. He submitted that the
deceased was plying the taxi and his income was Rs.4,000/- per month
and therefore, considering the young age of about 27 years of the
deceased and future prospectives, the Tribunal has arrived at the
datum figure for the purpose of dependency benefit at Rs.6,000/- per
month, i.e. Rs.72,000/- per annum and has adopted the multiplier of
18, which is just and proper. He also submitted that while making the
award, the Tribunal has not awarded any amount towards the loss of
consortium. Therefore, the award is just and proper and does not call
for any interference. He, therefore, urges to dismiss the appeal.
5. We
have considered the submissions advanced by Ms. Megha Jani, learned
Advocate for the appellant-Insurance Company, and Mr. Mehul Shah,
learned Advocate for the respondent Nos.1 to 4 – original claimants.
We have also perused the judgement and award as well as oral and
documentary evidence supplied by the learned Advocates appearing for
the parties during the course of submissions.
6. It
is not in dispute that the appellant has not challenged the finding
of the Tribunal on the aspect of negligence of the driver of the
offending tanker. Therefore, we do not deem it expedient to examine
on this aspect.
7. The
only aspect, which is now required to be addressed, is the quantum of
compensation. Therefore, the rival submissions made as regards the
income of the deceased, including the prospective income assessed by
the Tribunal for the purpose of dependency benefit, are required to
be appreciated. As discussed and reflected in the judgement and award
of the Tribunal, the deceased was earning Rs.4,000/- at the time of
the accident. Therefore, considering the guidelines laid down by the
Division Bench of this Court in
the case of Smt. Rafia Sultan vs. O.N.G.C.,
reported in 19 85 (2) GLR 1315,
the present income is required to be doubled for
consideration of the future prospective and taking the average
thereof, the datum figure for the dependency benefit would come at
Rs.6,000/- per month, i.e. Rs.72,000/- per annum. Out of this amount,
one third is required to be deducted towards upkeeps and personal
expenses to be incurred by the deceased as he was a married man. The
net dependency benefit would, therefore, come to Rs.48,000/- per
annum. Therefore, the only point which is required to be focused is
applying proper multiplier.
8. The
Honourable Apex Court, in the case of G.M. Kerala State Road
Transport Corporation vs. Susamma Thomas, reported in
1994 ACJ 1, elucidating on the aspect of
compensation and the method for arriving at the dependency benefits,
has made the observations and quoted the principle enunciated under
the Fatal Accidents Act of 1846 and 1976. It has been quoted from the
judgement in the case of Davies vs. Powell,
(1942) AC 601 at page 609 as under:
?SLord
Wright in the same case said: The actual pecuniary loss of each
individual entitled to sue can only be ascertained by balancing, on
the one hand, the loss to him of the future pecuniary benefit, and,
on the other, any pecuniary advantage which from whatever source
comes to him by reason of the death.??
8.1 The
words of Lord Wright have been adopted and quoted as the principle
applicable also under the Indian laws in Gobald Motor
Service Ltd. vs. R.M.K.Veluswami, 1958-65 ACJ 179 (SC),
where the Supreme Court has briefly observed as under:
?Sthe
general principle is that the actual 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
dependent by the death must be ascertained.??
8.2 The
Apex Court has discussed, elaborating on this aspect and this
principle that as to how the dependency of the multiplicand could be
adopted or arrived at, and has also quoted from Halsbury’s
Laws of England in Vol.34, para-98,
again emphasising the same principle as under:
?S(98)
Assessment of damages under the Fatal Accident Act, 1976 – The courts
have evolved a method for calculating the amount of pecuniary benefit
that dependants could reasonably expect to have received from the
deceased in the future. First the annual value to the dependants of
those benefits (the multiplicand) is assessed. In the ordinary case
of the death of a wage-earner that figure is arrived at by deducting
from the wages the estimated amount of his own personal and living
expenses.
The
assessment is split into two parts. The first part comprises damages
for the period between death and trial. The multiplicand is
multiplied by the number of years which have elapsed between those
two dates. Interest at one-half the short-term investment rate is
also awarded on that multiplicand. The second part is damages for the
period from the trial onwards. For that period, the number of years
which have based on the number of years that the expectancy would
probably have lasted; central to that calculation is the probable
length of the deceased’s working life at the date of death.”
Further,
as to the multiplier, Halsbury states that:
“However,
the multiplier is a figure considerably less than the number of years
taken as the duration of the expectancy. Since the dependants can
invest their damages, the lump sum award in respect of future loss
must be discounted to reflect their receipt of interest on invested
funds, the intention being that the dependants will each year draw
interest and some capital (the interest element decreasing and the
capital drawings increasing with the passage of years), so that they
are compensated each year for their annual loss, and the fund will be
exhausted at the age which the court assesses to be the correct age,
having regard to all contingencies. The contingencies of life such as
illness, disability and unemployment have to be taken into account.
Actuarial evidence is admissible, but the courts do not encourage
such evidence. ?S
8.3 The
Honourable Apex Court, in this very judgement in the case of Susamma
Thomas (supra), has discussed that though the method
of multiplier is logically sound and legally well established, but,
the calculation referring to the age of the deceased at the time of
the accident and the expected life of years and adopting the higher
multiplier has been disapproved.
8.4 In
this very judgement, the Apex Court has also observed in paragraph 7
that:
?S7. The
assessment of damages to compensate the dependants is beset with
difficulties because from the nature of things, it has to take into
account any 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 together.
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.
Much
of the calculation necessarily remains in the realm of hypothesis
‘and in that region arithmetic is a good servant but a bad master’
since there are so often many imponderables. In every case ‘it is the
overall picture that matters’, and the court must try to assess as
best as it can the loss suffered.??
8.5 Further,
this very judgement and the principle referred to has been followed
in the subsequent judgements, including in the judgement in the case
of Oriental Insurance Company Limited vs.
Jashuben & Ors., reported in 2008
(2) SCALE 474. The Honourable Apex Court in this
judgement in paragraph 13 has observed as under:
?SThe
amount of compensation indisputably should be determined having
regard to the pecuniary loss caused to the dependents by reason of
the death of the victim. It was necessary to consider the earnings of
the deceased at the time of the accident. Of course, further prospect
is not out of bound for such consideration. But the same should be
founded on some legal principle.??
8.6 Further,
referring to the judgement and quoting from the judgement in the case
of Susamma Thomas (supra), the Honourable Apex
Court has again made the observations in paragraph 14 as under:
?S14. In
General Manager, Kerala State Road Transport Corporation, Trivendrum
vs. Susamma Thomas [(1994) 2 SCC 176], this Court held:
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.??
Not
only that, in the case of Oriental Insurance Company vs.
Jashuben & Ors. (supra), the Honourable Apex Court
has also referred to other judgements, including the observations
made in paragraph 18 in the judgement in the case of T.N.
State Transport Corporation Ltd. vs. S. Rajapriya & Ors.,
reported in (2005) 6 SCC 236,
and in the case of
U.P. State Road Transport Corporation vs. Krishna Bala &
Ors., reported in (2006) 6 SCC 249,
and observed as to how the multiplier method should be referred and
in the case of the deceased aged about 36 years, the multiplier of 13
was found to be just and proper.
8.7 As
regards calculation of the dependency benefit arrived at on the basis
of the income, the Honourable Apex Court, in the case of Oriental
Insurance Company vs. Jashuben & Ors. (supra), has
also referred to the case of Sarla Dixit & Anr. vs.
Balwant Yadav & Ors., reported in
(1996) 3 SCC 179, and observed as to how the
income could be arrived at. Thus, the principles/guidelines laid down
by the Honourable Apex Court have been followed consistently as
regards future prospective income as well as multiplier for the
purpose of arriving at the dependency loss.
9. In
light of the observations made by the Honourable Apex Court in the
judgements reported in the case of Susamma Thomas
(supra) and Oriental Insurance Company vs. Jashuben &
Ors. (supra), the maximum multiplier that can be
awarded for arriving at the dependency benefit is 15. Therefore,
though the submissions have been made by Mr. Shah, learned Advocate
for the claimants, that the deceased was aged about 27 years at the
time of the accident, considering his young age and in light of the
observations made by the Apex Court in the aforesaid judgement, we
deem it proper that the maximum multiplier of 15 can be adopted.
Therefore, the net dependency benefit would come to Rs.48,000/- x 15
= Rs.7,20,000/-. At the same time, as rightly pointed out by the
learned Advocate, Mr. Shah, no award has been made for the loss of
consortium, which is required to be awarded.
Therefore,
as the Tribunal has not awarded any amount towards the loss of
consortium, without going into much details, we propose to modify the
award by rounding off the award amount to Rs.8,16,000/- instead of
Rs.9,45,000/- as follows:
Rs.7,20,000/-
Towards loss of dependency benefits
Rs.
15,000/- Towards pain shock and suffering
Rs.
15,000/- Towards loss of estate
Rs.
15,000/- Towards the loss of consortium
Rs.
5,000/- Towards funeral expenses
Rs.
46,000/- Towards damages to the taxi
——————
Rs.8,16,000/- Total
Accordingly,
the present appeal deserves to be allowed.
10. Therefore,
Rs.8,16,000/- is awarded as the total amount of compensation to the
claimant instead of Rs.9,45,000/-. Accordingly, the claimants would
be entitled to the compensation of Rs.8,16,000/- instead of
Rs.9,45,000/-.
11. For
the foregoing reasons, the appeal succeeds in part and is partly
allowed with no order as to costs. The impugned judgement and award
dated 24th July, 2002 passed by the Motor Accident Claims
Tribunal (Auxiliary), Kachchh at Bhuj in M.A.C.P. No.149 of 1994,
awarding compensation of Rs.9,45,000/-, is hereby modified by
awarding total compensation of Rs.8,16,000/- instead of Rs.9,45,000/-
together with interest at the rate of 9% per annum from the date of
the petition till the date of realisation with proportionate costs
thereon. Rest of the directions contained in the impugned judgement
and award are not disturbed and maintained.
12. At
this stage, it is stated by Ms. Megha Jani, learned Advocate for the
appellant, that in compliance of the impugned award, the
appellant-Insurance Company has deposited the entire amount of
compensation together with interest and costs thereon with the
Tribunal. She requested that as this Court has modified the award,
the excess amount of Rs.1.29 Lakh may be ordered to be refunded out
of the amount lying deposited with the Tribunal.
13. In
view of the above, the Motor Accident Claims Tribunal (Auxiliary),
Kachchh at Bhuj is directed to refund the amount of Rs.1.29 Lakh out
of the amount lying with it along with the interest accrued thereon.
Award
be drawn accordingly.
[A.
M. Kapadia, J.]
[R.
H. Shukla, J.]
kamlesh*
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