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2016 DIGILAW 421 (JK)

Kuldeep Singh v. Union of India

2016-08-10

JANAK RAJ KOTWAL

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JUDGMENT : Janak Raj Kotwal, J. 1. This is appeal against the judgment and award dated 28.11.2013 rendered by the Motor Accidents Claims Tribunal, Jammu (for short the Tribunal) in Claim No. 351/2011, whereby compensation of Rs. 2,55,000/- has been awarded in favour of the appellants on account of the death of their 14 years old son due to a road traffic accident caused by Army Vehicle No. 00D-127503 (for short the offending vehicle) on 25.07.2011. 2. Heard learned counsel for the parties and perused the record. 3. On 25.07.2011 deceased, Harmeet Singh, was standing on side of the road at a place called Kalal in Tehsil, Nowshera of District, Rajouri. He was knocked down by the offending vehicle. He died due to this accident. His legal representatives filed a claim under Section 166 of the Motor Vehicles Act, 1988 (for short, the Act) in the Tribunal. Learned Tribunal on inquiry found that accident had occurred due to negligence of the driver of the offending vehicle-Respondent No. 2 and awarded compensation to the appellants. Compensation to third claimant, Davinder Kour, who is sister of the deceased, however, was refused as learned Tribunal took the view that in the life time of her parents she cannot be treated as dependent of the deceased. 4. As the deceased was a non-earning person, having no income prior to the accident, assumed Rs. 15,000/- as notional annual income of the deceased and awarded compensation of Rs. 2,25,000/- under the head Loss of Dependency. This assumptions seems to have been drawn in terms of Section 163-A of the Act read with the Second Schedule. In addition, learned Tribunal awarded Rs. 25,000/- as compensation towards Funeral Expenses and Rs. 5,000/- as compensation for Loss of Estate. 5. Appellants are not satisfied with the amount of compensation awarded by the Tribunal. Learned counsel Mr. Kamal Gupta, represents the appellants. Mr. Gupta submitted that learned Tribunal has fallen in error by assuming notional income of the deceased as Rs. 15,000/- only. Mr. Gupta argued that the concept of notional income under Section 163-A engrafted in the year 1994 should not be applied now after more than two decades as the same cannot lead to awarding just and reasonable compensation to the ; legal representatives of non-earning persons. Mr. Gupta argued further that deceased was a student and had bright future. Mr. Gupta argued that the concept of notional income under Section 163-A engrafted in the year 1994 should not be applied now after more than two decades as the same cannot lead to awarding just and reasonable compensation to the ; legal representatives of non-earning persons. Mr. Gupta argued further that deceased was a student and had bright future. His future prospects should have been taken into consideration and notional income should have been taken not less than Rs. 30,000/- and by applying the multiplier of 15 the just compensation under the head Loss of Dependency payable to the claimants would be Rs. 4,50,000/-. 6. Mr. N.A. Choudhary, CGSC, however, on the other hand, supported the award. He argued that the deceased admittedly was a non-earning person so for determining compensation for Loss of Dependency his income could not have been taken more than Rs. 15,000/- per annum. 7. Section 166 of the Act provides for making an application for laying claim for compensation before Motor Accidents Claims Tribunals constituted in terms of Section 165 of the Act for death of or bodily injury to a person in a road traffic accident. Section 168 enjoins a duty on a Claims Tribunal to hold an inquiry into the claim and determine and award such amount of compensation which appears to it to be just. Award of compensation in terms of Section 166 read with Section 168 is based on the principle of tortuous liability so the claimants will have to plead and establish that death or the injury in respect of which claim has been made was due to any wrongful act or neglect or default of the driver of a vehicle or its owner. 8. Section 163-A, which came to be engrafted in the Act by the Amendment Act 54 of 1994 with effect from 14th November, 1994, provides for grant of compensation by owner or insurer of the offending vehicle in the case of death or permanent disablement caused due to a road traffic accident in accordance with the structured formula indicated in Second Schedule to the Act inserted vide Amendment Act 54 of 1994 too. The Second Schedule, among its other provisions, lays down Rs. 15,000/- as notional income for calculation of compensation in respect of those who had no income prior to accident. The Second Schedule, among its other provisions, lays down Rs. 15,000/- as notional income for calculation of compensation in respect of those who had no income prior to accident. The scheme of Section 163-A is a departure from the' general principle of law of tort that the liability of the owner of the vehicle to compensate the victim or his legal representatives in a motor accident arises only on the proof of negligence on the part of the driver. Section 163-A has done away with the requirement of pleading or establishing that death or permanent disablement in respect of which the claim has been made was due to any wrongful act or neglect or default of the driver or owner of the vehicle. 9. Section 166 of the Act read with Section 168 on one hand and Section 163-A on the other provide for two different modes of claiming compensation for death or permanent disablement suffered in a road traffic accident. Nonetheless, after engraftment of Section 163-A and the Second Schedule the Claims Tribunals even in claims under Sections 166 read with Section 168 had been taking assistance from the Second Schedule in the matter of selection of multiplier and in assuming Rs. 15,000/- as the notional annual income of the non-earning victims of the road traffic accidents. The assistance from the Second Schedule for selecting the multiplier, however, is no more permissible after Supreme Court judgment in Sarla Verma v. Delhi Transport Corporation, 2009 ACJ 1298 , which lays down the multiplier for different age groups. In Sarla Verma Honble Supreme Court has simplified the otherwise complex exercise of determining the loss of dependency and the compensation in the claims under section 166 of the Act read with Section 168 in fatal accident cases. However, question relating to loss of dependency to the parents of the deceased who were non-earning youngster or student has neither been considered nor decided in Sarla Verma. The practise of assuming Rs. 15,00/- as notional annual income of non-earning victims, therefore, still continues. 10. Having heard learned counsel for both the sides, I feel inclined to address the question as to whether assuming Rs. The practise of assuming Rs. 15,00/- as notional annual income of non-earning victims, therefore, still continues. 10. Having heard learned counsel for both the sides, I feel inclined to address the question as to whether assuming Rs. 15,000/- as notional annual income of a non-earning victims of road traffic accidents now after two decades of insertion of the Second Schedule in the Act can lead to grant of just and reasonable compensation to them or their parents or the legal representatives, as the case may be. 11. As said above, in a claim application under Section 166 read with Section 168 of the Act a duty is cast on the Claims Tribunals to determine and award such compensation 'which appears to it to be just. The expression which appears to it to be just provides a wide amplitude of discretion to the Tribunals in the matter of determination of the compensation. The purpose of such wide discretion primarily is to award just and reasonable compensation based on reasonable grounds. 12. In Syed Basheer Ahmed and Ors. v. Mohd. Jameel and Ors., 2009 ACJ 690 , Supreme Court has held in Para 9: "9. Section 168 of the Act enjoins the Tribunal to make an award determining "the amount of compensation which appears to be just." However, the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression "which appears to the just" vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of compensation. Similarly, although the Act is a beneficial legislation, it can neither be allowed to be used as a source of profit, nor as a windfall to the persons affected nor should it be punitive to the persons liable to pay compensation. The determination of compensation must be based on certain data, establishing reasonable nexus between the loss incurred by the dependents of the deceased and the compensation to be awarded to them. In nutshell, the amount of compensation determined to be payable to the claimants has to be reasonable and reasonable by accepted legal standards." 13. The determination of compensation must be based on certain data, establishing reasonable nexus between the loss incurred by the dependents of the deceased and the compensation to be awarded to them. In nutshell, the amount of compensation determined to be payable to the claimants has to be reasonable and reasonable by accepted legal standards." 13. Some important factors, which are taken into consideration in computing the compensation in cases of fatal accidents, are the age of the deceased and his income at the time of his death, number of dependents of the deceased at the time of death, expenses which would have been incurred towards maintaining himself had he been alive and his contribution towards his dependents. In determining the income of the deceased, besides the actual income of the deceased at the time of his death, a duty is cast on the Tribunal to take into consideration the future prospect in life of the deceased, possibility of his progression in career when he is in a settled employment etc. as also the imponderables in life. 14. A different situation, however, arises when the deceased in respect of whose death compensation is claimed is a non-earning person because in such a case it becomes difficult to determine his contribution towards his legal representatives (dependents) as his income prior to his death is not known. The general trend after engraftment of Section 163-A and the Second Schedule in the Act is to take Rs. 15.000/- as his notional annual income as provided under the Second Schedule. 15. It cannot now escape consideration that the concept of Rs. 15,000/- as notional annual income had been devised by the legislature more than two decades back in the year 1994. To take Rs. 15,000/- as notional annual income of a non-earning person even after two decades of engraftment of Section 163-A and the Second Schedule in the Act cannot lead to award of just and reasonable compensation and would be contrary to the legislative intent indicated in sub-section (3) of Section 163-A, which provides that the "Central Government may, keeping in view the cost of living by notification in the Official Gazette, from time to time, amend the Second Schedule." This legislative intent has been recognised by the Supreme Court when a similar question was raised in R.K. Malik and Anr. v. Kiran Pal and Anr., AIR 2009 SC 2506 . v. Kiran Pal and Anr., AIR 2009 SC 2506 . Their Lordships have observed: "We must point out here that the learned counsel for the appellants had argued that the notional sum of Rs. 15,000/- should be enhanced and increased as the legislature has not amended the Second Schedule and the same continues to be in existence since it was enacted on 14.11.1994. We are not examining and going into this aspect as the accident had taken place in the present case nearly three years after the enactment of the Second Schedule. The time difference between the date of the enactment and the date of accident is not substantial." 16. The legislature, while providing structured formula in the Second Schedule for determining compensation in terms of Section 163-A indeed had visualized the future increase in cost of living and has, therefore, empowered the Central Government to amend the Second Schedule from time to time. There cannot be any denial of the fact that there is a significant increase in cost of living in every stratum of living standard. There is many fold increase in salary and wages as Compared to that in the year 1994. What might have been just and reasoned notional income in year 1994 cannot be so now after more than two decades. Even though, the Government so far has not amended Schedule Second, the Claims Tribunals or the Courts have to discharge their statutory and solemn duty of awarding just and reasonable compensation when it comes to determining compensation in a claim under Section 166 read with Section 168. In achieving the object of granting just and reasonable compensation the Tribunals or the Courts are neither bound to follow the Second Schedule nor should they so that the solemn object is not defeated. 17. In assuming the notional income of a non earning young person, besides having regard to the increase in cost of living, his future prospects as also imponderables in life should be addressed by the Tribunals. The future of a young person, particularly a student, is uncertain, lie is a budding flower, which may bloom in sunrise or fade in a storm. The task of computing the compensation therefore, becomes difficult and for arriving at a just and reasonable figure some guess work may also be required. If the deceased was a student, his performance in school, the reputation of the school etc. The task of computing the compensation therefore, becomes difficult and for arriving at a just and reasonable figure some guess work may also be required. If the deceased was a student, his performance in school, the reputation of the school etc. are the factors which can be taken into consideration. Family background is also an important factor to be taken into consideration. To enable the Claims Tribunal to arrive at a just and reasonable conclusion a duty is cast on the claimants to lead sufficient evidence so that all relevant aspects are taken into consideration. 18. In the case on hand, claimant, Kuldeep Singh, father of the deceased has stated that the deceased, Harmeet Singh, was 14 years old and a student of 9th class at the time of the accident. He has stated further that the deceased was his only son, besides one daughter, and that he wanted to make him an Army Officer. Contention in this appeal is that the notional annual income of the deceased should have been taken not less than Rs. 30,000/- and applying the multiplier of 15, compensation under the head Loss of Dependency should have been Rs. 4,50,000/-. 19. I find justification in the contention that Rs. 4,50,000/- would have been just and reasonable compensation under the head Loss of Dependency. There is no rebuttal to the say of the claimant(parents) that his son was a 9th standard student at the age of 14 which in turn indicates that he was good in his studies having reached up to 9th standard without any break. The evidence led by the claimants (parents), however, is not sufficient to lay down a foundation for peeping into his future prospects or to say that he had the capability of becoming an Army Officer as desired by his father or would have attained some high position in life. This needs to be looked into in the backdrop that father of the deceased has disclosed his profession as a farmer. Nonetheless, the deceased being a student of 9th standard at the ago of 14, possibility of his having secured job in Government or Private Sector, may be at lower or lowest level, can well be visualized. In any case, it would have been, and it is, just and proper to assume his notional monthly income as Rs. 5,000/- amounting to Rs. 60,000/- per annum. 20. In any case, it would have been, and it is, just and proper to assume his notional monthly income as Rs. 5,000/- amounting to Rs. 60,000/- per annum. 20. Having assumed the income of the deceased, the next step is to determine his contribution towards his parents (claimants) by making the deduction of his personal and living expenses. Important factor in this regard would be that the deceased, had he not met with the unfortunate end, would have got married in the due course of time and would have had his own family to maintain, resulting into considerable decrease in his contribution towards the parents. In the cases involving death of an unmarried son, it is now well settled that 50 per cent of the income of the deceased is deducted towards his personal and living expenses and fifty per cent is taken as contribution towards the parents (Ref. Sarla Verma followed in Shakti Devi, (2010) 14 SCC 575 ). Same principle would apply to a case involving the death of an non-earning unmarried son. The Loss of Dependency in this case was therefore, is Rs. 3,000/-, that is, fifty per cent of the Rs. 60,000/-. 21. In regard to the selection of multiplier, recently a learned three-Judge Bench of the Supreme Court in Munna Lal Jain and Ors. v. Vipin Kumar Sharma and Ors., 2015 ACJ 1985 , has approved the view that the age of deceased will govern the selection of the multiplier. I may reproduce Para 12 of the reporting: "12. The remaining question is only on multiplier. The High Court following Santosh Devi (supra), has taken 13 as the multiplier. Whether the multiplier should depend on the age of the dependants or that of the deceased, has been hanging fire for sometime; but that has been given a quietus by another three-Judge Bench decision in Reshma Kumari 2013 ACJ 1253 (SC). It was held that the multiplier is to be used with reference to the age of the deceased. One reason appears to be that there is certainty with regard to the age of the deceased but as far as that of dependants is concerned, there will always be room for dispute as to whether the age of the eldest or youngest or even the average, etc., is to be taken. To quote: "36. One reason appears to be that there is certainty with regard to the age of the deceased but as far as that of dependants is concerned, there will always be room for dispute as to whether the age of the eldest or youngest or even the average, etc., is to be taken. To quote: "36. 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 the 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 towards 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." 22. Supreme Court in Sarla Vermas case (supra) has held that in the claims falling under Section 166 of the Act, multiplier mentioned in Column (4) of the table drawn in the judgment shall be applied. The Column (4) of the table has been prepared after comparative analysis of the law in regard to selection of multiplier discussed and laid down in landmark judgments in Susamma Thomas, 1994 ACJ 1 and Trilok Chandra (1996) 4 SCC 362 and the table prescribed in the Second Schedule in the Act. 23. The deceased was 14 as at the time of his death. Learned Tribunal has applied the multiplier of 15 to which there is no assail in this appeal from either of the parties and I do not feel it necessary to discuss this aspect. The compensation payable under the head Loss of Dependency, therefore comes out as Rs. 4,50,000/- (30,000x15) instead of Rs. 2,25,000/- awarded by the Tribunal. 24. Viewed thus, this appeal has merit and is allowed. Compensation awarded by the learned Tribunal under the head Loss of Dependency is enhanced from Rs. 2,25,000/- to Rs. 4,50,000/-. The compensation payable under the head Loss of Dependency, therefore comes out as Rs. 4,50,000/- (30,000x15) instead of Rs. 2,25,000/- awarded by the Tribunal. 24. Viewed thus, this appeal has merit and is allowed. Compensation awarded by the learned Tribunal under the head Loss of Dependency is enhanced from Rs. 2,25,000/- to Rs. 4,50,000/-. Rest of the conditions including rate of interest as awarded by the learned Tribunal shall be the same. The respondents shall comply with this judgment within six weeks hereafter by depositing the amount in the Tribunal. 25. Record of the Tribunal be remitted back along with a copy of this order.