JUDGMENT
Amitava Lala, J.
1. This is an appeal of the insurance company from a judgment and award of compensation dated 04th May, 2007 passed by the concerned Motor Accidents Claims Tribunal, Muzaffarnagar, U.P. for a sum of Rs. 1,52,000/- along with interest on account of death of a child aged about 8 years in a claim petition under Section 166 of the Motor Vehicles Act, 1988 (hereinafter called as ‘Act’). The application of the insurance company under Section 170 of the Act was allowed by the Tribunal saying that the vehicle owner did not contest the proceeding. Therefore, the order is reasoned order as per ratio of the judgment and order dated 1st August, 2007 in First Appeal From Order No. 2087 of 2007 United India Insurance Co. Ltd. v. Krishna Kumar and Ors. following the ratio of United India Insurance Co. Ltd. v. Jyotsnaben Sudhirbhai Patel and Ors. According to the learned Counsel appearing for the appellant, the quantum of compensation granted by the tribunal is in the higher side in view of the ratio of the judgment reported in 2007 (3) T.A.C. 16 (S.C.) Kaushlya Devi v. Shri Karan Arora and Ors., whereunder the awarded compensation was Rs. 1,00,000/- along with interest for only child of the parents who expired at the age about 14 years, unlike the present one, where out of two children of the parents one has expired. Therefore, the awarded amount should be less than the awarded amount of the above referred case.
2. According to us, the submission of the insurance company is too harsh in nature being forgetful that the Act itself is a social piece of legislation whereunder equitable principle will be applicable to test the factum of each and every case independently before granting any award of compensation. It is more so in a case of claim petition under Section 166 of the Act, where the Tribunal has to arrive at a quantum of ‘just’ compensation. The expression ‘just’ denotes equitability, fairness and reasonableness, and non-arbitrariness. In National Insurance Co. Ltd. v. Swaran Singh and Ors. a three Judges’ Bench of the Supreme Court has categorically held the following at the time of coming to conclusion:
(i) Chapter XI of the Motor Vehicles Act, 1988 providing compulsory insurance of vehicles against third-party risks is a social welfare legislation to extend relief by compensation to victims of accidents caused by use of motor vehicles. The provisions of compulsory insurance coverage of all vehicles are with this paramount object and the provisions of the Act have to be so interpreted as to effectuate the said object.
3. It is established by now that the award cannot be made on the basis of mathematical precision but upon considering various aspects of the matter in the light of the Act being a piece of social welfare legislation. The Act is tilted towards the claimants with such objects and reasons. Therefore, when the Parliament made such Act and the Supreme Court confirmed, there should not be any departure. The intention of the legislature is that one should take a pragmatic approach in granting an award of compensation.
4. In paragraph 11 of Jeewanlal Ltd. and Ors. v. Appellate Authority Under The Payment Of Gratuity Act and Ors. it has been held by the three Judges’ Bench of the Supreme Court as follows:
11. In construing a social welfare legislation, the court should adopt a beneficent rule of construction; and if a section is capable of two constructions, that construction should be preferred which fulfils the policy of the Act, and is more beneficial to the persons in whose interest the Act has been passed. When, however, the language is plain and unambiguous, the Court must give effect to it whatever may be the consequence, for, in that case, the words of the statute speak the intention of the Legislature. When the language is explicit, its consequences are for the Legislature and not for the courts to consider. The argument of incovenience and hardship is a dangerous one and is only admissible in construction where the meaning of the statute is obscure and there are two methods of construction. In their anxiety to advance beneficent purpose of legislation, the courts must not yield to the temptation of seeking ambiguity when there is none.
5. In Kaushlya Devi (Supra) the Supreme Court never awarded any compensation but confirmed the order of the tribunal considering that the same is in the lower side at the instance of the claimant, not the insurance company. In the above referred case factually the driver of the vehicle was minor who was not authorised to drive any vehicle. The deceased himself was negligent. Inspite of the same, the Supreme Court affirmed the awarded amount given by the tribunal, which under no circumstances can be an example in awarding compensation of similar amount in the present case, in other words, factual circumstances of the referred case and the present ease are totally distinguishable in nature. In the present case, it is proved beyond doubt on the basis of evidence of two eye-witnesses i.e. mother of the deceased and an independent witness that the Bus hit the horse-cart rashly and negligently by which passengers were injured and the deceased died on the spot. Nobody has come forward to deny or rebut the evidence of the eyewitnesses. It is also proved beyond doubt that the driver of the Bus was holding the valid license. It is further proved that the Bus was fully under insurance coverage. Although the factual circumstances of both the cases are dissimilar but an important observation about the income of the minor has been made therein. Paragraph-10 of the above referred case is as follows:
10. In cases of young children of tender age, in view of uncertainties around, 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 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.
6. A similar observation is made by the parallel Bench of the Supreme Court as New India Assurance Co. Ltd. v. Satender and Ors. However, factual background of such case is again distinct from the present case. The Supreme Court arrived at a figure of Rs. 1,80,000/- with interest @ 7.5% from the date of petition till the payment in the appeal of the insurance company. Factually the age of the deceased was 9 years. The claim petition was made under Section 166 of the Act. Although the tribunal found that the child was not earning member and the compensation would be assessed on the basis of notional income as per the Second Schedule under the Act for a sum of Rs. 15,000/- p.a., but the same was felt unrealistic and arrived at a notional income of Rs. 30,000/- p.a. and deducted 1/3rd towards personal expenses and applied multiplier of 17, thereby arrived at a figure of compensation along with other expenses to Rs. 4,45,000/-. According to the Supreme Court, the tribunal was wrong in arriving at a notional income of Rs. 30,000/- p.a. and also applying multiplier, therefore, the awarded amount is in the higher side. No one appeared on behalf of the claimants in spite of notice. Learned Counsel appearing for the owner of the offending vehicle and the driver supported the stand of the insurance company. Against this background, the Supreme Court observed that 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 the cases, where parents are claimants, the relevant factor would be age of parents. In case of death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child’s life-time. But this will not necessarily bar the parent’s claim and prospective loss will find a valid claim provided the parents’ establish that they had a reasonable expectation of pecuniary benefit if the child had been alive.
7. However, at the time of drawing conclusion referred three Judges’ Bench judgment of the Supreme Court Lata Wadhwa and Ors. v. State of Bihar and Ors. where the question of grant of compensation arose out of accident within the campus of the factory of the Tata Iron & Steel Co. (in short TISCO) Jamshedpur, Bihar (now Jharkhand), where several children between age group of 5 to 15 were died. A writ petition was filed in the Supreme Court under Article 32 of the Constitution claiming compensation amongst others. The Supreme Court divided the children into two categories. First category belonged to the age group between 5 to 10 years when the second category belonged to the age group between 10 to 15 years. Ultimately held as follows:
Mr. Nariman, appearing for the TISCO on his own, submitted that the compensation determined for the children of all age groups could be doubled, as in his views also, the determination made is grossly inadequate. Loss of a child to the parents is irrecoupable, and no amount of money could compensate the parents. Having regard to the environment from which these children were brought, their parents being reasonably well placed officials of the Tata Iron and Steel Company, and on considering the submission of Mr. Nariman, we would direct that the compensation amount for the children between the age group of 5 to 10 years should be three times. In other words, it should be Rs. 1.5 lakhs, to which the conventional figure of Rs. 50,000/- should be added and thus the total amount in each case would 09 Rs. 2.00 lakhs. So far as the children between the age group of 10 to 15 years, they are all students of Class VI to Class X and are children of employees of TISCO. The TISCO itself has a tradition that every employee can get one of his child employed In the company. Having regard to these facts, in their case, the contribution of Rs. 12,000/- per annum appear to us to be on the lower side and in our considered opinion, the contribution should be Rs. 24,000/- and instead of 11 multiplier, the appropriate multiplier would be 15. Therefore, the compensation, so calculated on the aforesaid basis should be worked out to Rs. 3.60 lakhs, to which an additional sum of Rs. 50,000/- has to be added, thus making the total amount payable at Rs. 4.10 lakhs for each of the claimants of the aforesaid deceased children.
8. Therefore, the question of awarding compensation therein was settled out of concession not on contest. In M.S. Grewai and Anr. v. Deep Chand Sood and Ors. the Supreme Court in dealing with an appeal from an order of, the High Court under Article 226 of the Constitution of India awarded compensation of Rs. 5,00,000/- each when several students drowned in a river due to negligence of the school teacher/s. It was categorically held two important parts in paragraphs 35 and 36 therein. Firstly, the decision in Lata Wadhwa (Supra), thus, is definitely a guiding factor in the matter of award of compensation wherein children died under an unfortunate incident as noticed more fully herein before in this judgment. Secondly, if the 2nd Schedule of Motor Vehicles Act, can be termed to be any guide, the compensation could have been a much larger sum. Thus in the factual situation award of compensation at Rs. 5,00,000/- can not by any stretch be termed to be excessive. In the case of Satender and Ors. (Supra) although the Supreme Court made a reference of Lata Wadhwa (Supra) but drawn conclusion on the ratio of State of Haryana and Anr. v. Jasbir Kaur and Ors. based on a factum of death of a young agriculturist aged about 25 years finding out no material about income the minimum income of Rs. 3000/- was assessed with multiplier to the tune of Rs. 4,34,0007- and interest @ 9% per annum and came to a finding that the award in case of death of a child of nine years should be Rs. 1,80,000/- along with the interest @ 7.5% from the date of filing petition till the payment. The payment was directed to be made within a period of three months from the date of the order on 8th November, 2006. The death of the child occurred on 7th May, 2002. Therefore, if a conservative estimate is made for a period of about four years, approximately the figure will come to a sum of Rs. 2,34,000/-. On the other hand, in 2005 (1) T.A.C. 609 (S.C.) Manju Devi and Anr. v. Musafir Paswan and Anr. following the ratio of U.P. State Road Transport Corporation and Ors. v. Trilok Chandra and Ors. the Supreme Court held that there should be no departure from the multiplier method on the ground that payment being made is just compensation. It has been held that the multiplier method must be accepted method for determining and ensuring payment of just compensation as it is the method which brings uniformity and certainty to awards made all over the country. In view of this authority, it will have to be held that the award of compensation had to be made by the multiplier method. As set out in the Second Schedule to the Motor Vehicles Act, 1988, for a boy of 13 years of age, a multiplier of 15 would have to be applied. As per the Second Schedule, he being a non-earning person, a sum of Rs. 15,000A must be taken as the income. Thus, the compensation comes to Rs. 2,25,000/-.
9. However, in the case of Trilok Chandra (Supra) it was held that the multiplier system in the schedule is full of mistakes. Neither the Tribunal nor the Court can go by it as a ready reckoner. It can only be used as a guide.
10. Therefore, let us sum up the inferences drawn on the basis of the aforesaid analysis:
(a) Trilok Chandra (supra) appreciated the multiplier method but held that it is not ready reckoner but guide in view of several mistakes in multiplication.
(b) In case of accident other than motor accident in Lata Wadhwa (supra) compensation was allowed on account of the children between the age group of 5-10 years for Rs. 2.00 lacs, whereas children between age group of 10-15 for Rs. 4.10 lacs on concession but not on contest.
(c) M.S. Grewal (supra) affirmed awarding compensation by the High Court in case of accident other than motor accident for a sum of Rs. 5.00 lacs on account of each children, following Lata Wadhwa (supra) only observing that in case of motor accident the awarded amount would have been much more.
(d) Manju Devi (supra) adopted multiplier method as discussed in Trilok Chandra (supra) but arrived at a compensation of Rs. 2,25,000/- in case of death of minor child of 13 years of age.
(e) In the case of Satender (supra) the Supreme Court followed the ratio of Jasbir Kaur (supra), which arose out of death of an unmarried youth where award of compensation was Rs. 4,34,000/- and interest, and awarded a sum of Rs. 1,80,000/- with interest in case of death of a child aged about 9 years. Significantly, none appeared on behalf of the claimants in spite of the notice.
(f) In the case of Kaushalya Devi (supra) the Supreme Court only confirmed the awarded amount of Rs. 1.00 lac with interest in case of death of a child aged about 14 years at the instance of claimants by dismissing the appeal.
11. Therefore, it is crystal clear that none of the judgments proceeded on any uniform trend nor it can be. It has to be based on facts and circumstances of each case. Against this background, we have to ascertain what is the ratio decidendi available on the basis of the discussion from the aforesaid judgments. The ratio decidendi is that in arriving at ‘just’ compensation the Court can not proceed by adopting a straight-jacket formula. It has to very from case to case. The other ratio decidendi is that in case of death of minor children, there is no scope of ascertainment of income. It is also very difficult to assess future prospect.
12. Against this background, now it is to be seen whether the legislature has made any provision to meet the requirement or not. The legislature has made a table called as the ‘Second Schedule’ under Section 163A of the Act. Section 163A of the Act provides special provisions for payment of compensation on the basis of structured formula therein. By now, it is well in settled that even in a case of ‘just’ compensation, the multiplier system of the Second Schedule as far as practicable will be followed. We have no quarrel with such proposition. Our anxiety is when the law is explicit to bring the non-earning persons under the heading of notional income, why the children, who are actually non-earning persons, can not be brought under such protective umbrella uniformly to arrive at a quantum of compensation. Why there should be futile exercise for determination of their income on the future prospect by applying multiplier method in general. According to us, several thoughts have been given about multiplier system but such multiplier system can not be applicable for the entire second schedule. The same will be applicable only in respect of the first heading of the Schedule with a note at the bottom about reduction by 1/3rd on account of the expenses, which the victim would have incurred towards maintaining himself had he been alive. How does it applicable towards children? When there is no income, there is no deduction. A social piece of legislation is always mass based but not made with a mind set of class. No body can assume who will be genius or prosperous in future only on the existing family structure. Mahatma Gandhi (since deceased) never knew about the fate of his son when father of Abraham Lincon (since deceased) never knew about fate of his son. In any event, if any claimant Insists for adopting structured formula, it will be entirely open for him or them. Therefore, choice of the claimant, being the carriage of proceeding, will become prime. If the claimant chooses to go by the multiplier system under the first heading of the second schedule, it will be entire risk and responsibility of the claimant to prove the case. However, according to us, uncertainty of the income of children is matching with the notional income but militating with the scheduled income and deduction thereto. None of the above referred cases have shown any guideline why the multiplier method will only be applicable even in the case of death of children when entire schedule is not covered by such method. Therefore, if the claim petition is made on the basis of notional Income or the Court feels that notional income will be appropriate to ascertain the claim of the claimant in case of death of a children, the Court will not be slow or hesitant in awarding compensation on the basis of the notional Income of Rs. 15,000/- per annum under 6th heading of the Second Schedule. It is also to be remembered in this context that composite analysis of two three Judges’ Bench of the Supreme Court in National Insurance Company Limited (supra) and Jeevanlal Ltd. and Ors. (supra) is that when an Act Is a social welfare legislation and in construing so the Court should adopt a beneficent rule of construction and if a section is capable of two constructions, that construction should be preferred which fulfils the policy of the Act, and is more beneficial to the persons in whose interest the Act has been passed. We do not find any ambiguity in understanding the gravity of situation and making an observation that there is no necessity of making further exercise unnecessarily when the law is explicit to award compensation to non-earning persons to the extent of Rs. 15,000/- per annum particularly on the repeated observations of the Supreme Court itself in Satender (supra) and Kaushlya Devi (supra) that in case of young children of tender age, in view of the uncertainties around, neither their income at the time of death nor the prospects of the future increased in their income nor chances of advancement of their career are capable of proper determination on estimated basis.
13. Thus, we hold and say that the compensation awarded by the tribunal is grossly in the lower side, which should not be interfered with at the instance of insurance company at all. Thus, the appeal cannot be admitted. Hence, the appeal is dismissed.
14. No order is passed as to costs.
15. Prayer of the appellant-insurance company for remittance of the statutory deposit of Rs. 25,000/- towards the concerned Motor Accidents Claims Tribunal in order to adjust with the amount of compensation to be paid to the claimant, is allowed.
16. However, since the claimants did not get any opportunity of hearing due to dismissal of appeal at the stage of admission, they are not debarred in making appropriate application in the tribunal for rectification of the award, if any, in accordance with law, if so advised.
Dilip Gupta, J.
17. I agree.