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Himachal Pradesh High Court · body

2019 DIGILAW 1220 (HP)

National Insurance Co. Ltd. v. Bima Devi

2019-08-27

TARLOK SINGH CHAUHAN

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JUDGMENT : Tarlok Singh Chauhan, J. Since common question of law and fact arise in these appeals, therefore, they are taken up together for consideration and are being disposed of by way of a common judgment. 2. The respondents are the claimants who have sought compensation on the death of the persons upon whom they were dependents, who died in a vehicular accident, which took place on 07.06.2013 at about 7:25 p.m. at village Bharrari involving the bus bearing registration No. HP-55-5274 owned by respondent-Dinesh Chauhan and duly insured with the appellant-company. 3. Since, neither the accident nor the contract of insurance has been denied, therefore, the sole question required to be determined in all these appeals is pertaining to the quantum of compensation. 4. Now, as regards the award of compensation, there can be no dispute that the compensation awarded by the learned Tribunal is now required to be determined in accordance with the decision of a Constitutional Bench of the Hon'ble Supreme Court in National Insurance Co. Ltd. versus Pranay Sethi and others, (2017) ACJ 2700. 5. Why this case came to be referred to the Constitutional Bench, the answer is not difficult to find and the same is set out in para-1 of the judgment itself which reads thus: "Perceiving cleavage of opinion between Reshma Kumari v. Madan Mohan, (2013) ACJ 1253 (SC) and Rajesh v. Rajbir Singh, (2013) ACJ 1403 (SC), both three-Judge Bench decisions, a two Judge Bench of this Court in National Insurance Co. Ltd. v. Pushpa, (2015) 9 SCC 166 , thought it appropriate to refer the matter to a larger Bench for an authoritative pronouncement, and that is how the matters have been placed before us." 6. The conflict between the judgments as extracted above was resolved by concluding that the decision in Rajesh versus Rajbir Singh, (2013) ACJ 1403 (SC) was not a binding precedent as it had not taken note of the decision in Reshma Kumari versus Madan Mohan, (2013) ACJ 1253(SC). The Hon'ble Supreme Court after considering the entire conspectus of law arrived at the following conclusions:- "(i) The two-Judge Bench in Santosh Devi, (2012) ACJ 1428 (SC), should have been well advised to refer the matter to a larger Bench as it was taking a different view than what has been stated in Sarla Verma, (2009) ACJ 1298 (SC), a judgment by a coordinate Bench. It is because a coordinate Bench of the same strength cannot take a contrary view than what has been held by another coordinate Bench. (ii) As Rajesh, (2013) ACJ 1403(SC) has not taken note of the decision in Reshma Kumari, (2013) ACJ 1253 (SC), which was delivered at earlier point of time, the decision in Rajesh is not a binding precedent. (iii) While determining the income, an addition of 50% of actual salary to the income of the deceased towards future prospects, where the deceased had a permanent job and was below the age of 40 years, should be made. The addition should be 30%, if the age of the deceased was between 40 and 50 years. In case the deceased was between the age of 50 and 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax. (iv) In case the deceased was self-employed or on a fixed salary, an addition of 40% of the established income should be the warrant where the deceased was below the age of 40 years. An addition of 25% where the deceased was between the age of 40 and 50 years and 10% where the deceased was between the age of 50 and 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component. (v) For determination of the multiplicand, the deduction for personal and living expenses, the tribunals and the courts shall be guided by paras 14 and 15 of Sarla Verma, (2009) ACJ 1298 (SC), which we have reproduced hereinbefore. (vi) The selection of multiplier shall be as indicated in the Table in Sarla Verma, (2009) ACJ 1298 (SC), read with para 21 of that judgment. (vii) The age of the deceased should be the basis for applying the multiplier. (viii) Reasonable figures under conventional heads, namely, loss to estate, loss of consortium and funeral expenses should be Rs.15,000, Rs.40,000 and Rs.15,000 respectively. The aforesaid amounts should be enhanced at the rate of 10 per cent in every three years." Conclusions (iii) to (viii) are relevant for the adjudication of these cases. 7. (viii) Reasonable figures under conventional heads, namely, loss to estate, loss of consortium and funeral expenses should be Rs.15,000, Rs.40,000 and Rs.15,000 respectively. The aforesaid amounts should be enhanced at the rate of 10 per cent in every three years." Conclusions (iii) to (viii) are relevant for the adjudication of these cases. 7. It is thus clear from the aforesaid that the compensation henceforth to be awarded in favour of the claimants is essentially to be abide by the aforesaid conclusions, more particularly, conclusions No.(iii) to (viii) which except for conclusions No.(v) and (vi) are self-speaking. 8. Now, as regards conclusions No. (v) and (vi), it would be apposite to extract paragraphs No.14, 15 and 21 along with table as referred to in Sarla Verma and others versus Delhi Transport Corporation and another, (2009) ACJ 1298(SC) which read thus:- "14. Though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in Trilok Chandras case, (1996) ACJ 831 (SC), the general practice is to apply standardized deductions. 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 dependant family members is 4 to 6, and one fifth (1/5th) where the number of dependant family members exceed six. 15. 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 dependent. In the absence of evidence to the contrary, brothers and sisters will not be considered as dependents, because they will either be independent and earning, or married, or be dependant on the father. In the absence of evidence to the contrary, brothers and sisters will not be considered as dependents, because they will either be independent and earning, or married, or be dependant on the father. 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 family of the bachelor is large and dependant on the income of the 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. 21. However, where family of the bachelor is large and dependant on the income of the 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. 21. We therefore hold that the multiplier to be used should be as mentioned in column (4) of the Table above (prepared by applying Susamma Thomas, Trilok Chandra and Charlie), which starts with an operative multiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years), reduced by one unit for every five years, that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for 41 to 45 years, and M13 for 46 to 50 years, then reduced by two units for every five years, that is, M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70 years." Age of the deceased Multiplier scale as envisaged in Susamma Thomas Multiplier scale as adopted in Trilok Chandra Multiplier scale in Trilok Chandra as clarified in Charlie Multiplier specified in second column in the Table in Second Schedule to MV Act Multiplier actually used in Second Schedule to MV Act (as seen from the quantum of compensation) (1) (2) (3) (4) (5) (6) Up to 15 years - - - 15 20 15 to 20 years 16 18 18 16 19 21 to 25 years 15 17 18 17 18 26 to 30 years 14 16 17 18 17 31 to 35 years 13 15 16 17 16 36 to 40 years 12 14 15 16 15 41 to 45 years 11 13 14 15 14 46 to 50 years 10 12 13 13 12 51 to 55 years 9 11 11 11 10 56 to 60 years 8 10 9 8 8 61 to 65 years 6 8 7 5 6 Above to 65 years 5 5 5 5 5 9. Evidently, the judgment in Pranay Sethi's case (supra) has brought about radical and fundamental changes with regard to award of compensation. Evidently, the judgment in Pranay Sethi's case (supra) has brought about radical and fundamental changes with regard to award of compensation. For this purpose, this Court would deal with the case by drawing a comparative table of the amount actually awarded by the learned Tribunal along with modified award. 10. In view of the aforesaid discussion, the compensation that would eventually work out is as under:- FAO (MVA) No. 295 of 2017 Award passed by the Tribunal Modified Award by this Court Sr.No. Heads Amount. 1. Monthly income = Rs.6000/- +50% = Rs.9000/-, less 1/4th = Rs.6700/- Rs.6700x12x16=Rs.12,86,400/-. Monthly income = Rs.6000/-+40% (Rs.2400) = Rs.8400/-, less 1/4th (Rs.2100) = Rs.6300/- Rs.6300x12x16=Rs.12,09,600/-. 2. Loss of consortium to the petitioner = Rs.50,000/- - 3. Conventional charges Rs.1,00,000/- Conventional charges Rs.70,000/- Total = Rs.14,36,000/- Total = Rs. 12,79,000/- FAO (MVA) No. 287 of 2017 Award passed by the Tribunal Modified Award by this Court Sr.No. Heads Amount. 1. Monthly income = Rs.6000/- +15% = Rs.6900/-, less 1/3rd = Rs.4600/- Rs.4600x12x9=Rs.4,98,800/-. Monthly income = Rs.6000/-+10% = Rs.6600/-, deduction 50% = Rs.3300/- Rs.3300x12x9=Rs.3,56,400/-. 2. Loss of consortium to the petitioner = Rs.50,000/- - 3. Conventional charges Rs.50,000/- Conventional charges Rs.70,000/- Total = Rs. 5,96,000/- Total = Rs. 4,26,400/- FAO (MVA) No. 289 of 2017 Award passed by the Tribunal Modified Award by this Court Sr.No. Heads Amount. 1. Monthly income = Rs.6000/- +50% = Rs.9000/-, less 1/4th = Rs.6700/- Rs.6700x12x16=Rs.12,86,400/-. Monthly income = Rs.6000/-+40% = Rs.8400/-, less 1/4th = Rs.6300/- Rs.6300x12x16=Rs.12,09,600/-. 2. Loss of consortium to the petitioner = Rs.50,000/- - 3. Conventional charges Rs.1,00,000/- Conventional charges Rs.70,000/- Total = Rs.14,36,000/- Total = Rs. 12,79,000/- FAO (MVA) No. 290 of 2017 Award passed by the Tribunal Modified Award by this Court Sr.No. Heads Amount. 1. Monthly income = Rs.6000/- +30% = Rs.7800/-, less 1/3rd = Rs.5200/- Rs.5200x12x14=Rs.8,73,600/-. Monthly income = Rs.6000/-+25% = Rs.7500/-, less 1/3rd = Rs.5000/- Rs.5000x12x14=Rs.8,40,000/-. 2. Loss of consortium to the petitioner = Rs.50,000/- - 3. Conventional charges Rs.1,00,000/- Conventional charges Rs.70,000/- Total = Rs.10,23,600/- Total = Rs. 9,10,000/- FAO (MVA) No. 306 of 2017 Award passed by the Tribunal Modified Award by this Court Sr.No. Heads Amount. 1. Monthly income = Rs.6000/- +50% = Rs.9000/-, less 50% = Rs.4500/- Rs.4500x12x18=Rs.9,72,000/-. Monthly income = Rs.6000/-+40% = Rs.8400/-, less 50%= Rs.4200/- Rs.4200x12x18=Rs.9,07,200/-. 2. - - 3. Conventional charges = Rs.50,000/- Conventional charges = Rs.30,000/- Total = Rs.10,22,000/- Total = Rs. 9,37,200/- 11. 1. Monthly income = Rs.6000/- +50% = Rs.9000/-, less 50% = Rs.4500/- Rs.4500x12x18=Rs.9,72,000/-. Monthly income = Rs.6000/-+40% = Rs.8400/-, less 50%= Rs.4200/- Rs.4200x12x18=Rs.9,07,200/-. 2. - - 3. Conventional charges = Rs.50,000/- Conventional charges = Rs.30,000/- Total = Rs.10,22,000/- Total = Rs. 9,37,200/- 11. The deceased in this case was admittedly 19 years of age and the learned Tribunal below awarded a compensation of Rs.7,48,000/- for his death. 12. Identical issue regarding awarding compensation in favour of a person, who was 17 years of age, was considered by this Court in Oriental Insurance Co. Ltd. vs. Chhama Devi & Ors., 2019 ACJ 536, wherein it was observed as under:- "24.Admittedly in this case the deceased was minor of 17 years of age. In the case of Kishan Gopal vs. Lala, (2013) ACJ 2594(SC), the Hon'ble Supreme Court had awarded a sum of Rs.4,50,000/- for the death of a minor child about 10 years. The accident in that case had taken place on 19.07.1992, whereas the accident in the instant case had taken place on 15.06.2010. 25. Therefore, keeping in view the entirety of the facts and circumstances of the case, more particularly the high cost of living and inflation, I am of the considered view that the ends of justice would be sub-served in case the award, as passed by the learned Tribunal, is modified and the petitioners are held entitled to a sum of Rs.6,75,000/- plus interest at the rate of 7.5% per annum from the date of filing of the petition i.e. 27.07.2010." Award passed by the Tribunal Modified Award by this Court Sr.No. Heads Amount. 1. Monthly income = Rs.6000 deduction 50% = Rs.3000/- Rs.3000x12x18=Rs.6,48,000/-. Monthly income = Rs.6000/- deduction 50%= Rs.3000/- Rs.3000x12x16=Rs.5,76,000/-. 2. - - 3. Conventional charges = Rs.1,00,000/- Conventional charges = Rs.1,00,000/- Total = Rs.7,48,000/- Total = Rs. 6,76,000/- 13. The appeals are partly allowed in the aforesaid terms, leaving the parties to bear their own costs. Pending application, if any, stands disposed of. CMP No. 6881/2018 in FAO (MVA) No. 295/2017 14. Allowed. The amount lying deposited in the Registry of this Court is ordered to be released in favour of the claimants along with upto date interest by remitting the same to their respective bank accounts details of which are given in para 5 of the application. Application stands disposed of.