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2020 DIGILAW 497 (ALL)

Nand Lal v. Orietnal Insurance Co. Limited

2020-02-13

AJIT KUMAR, RAMESH SINHA

body2020
JUDGMENT : 1. Heard Sri Shashank Shekhar, learned Advocate holding brief of Sri Anurag Sharma, learned counsel for the appellants and Sri Arun Kumar Shukla, learned counsel for the Insurance Company. 2. In view of the office report dated 5.2.2020 service of notice is deemed sufficient upon the proforma respondent Nos. 4 to 6. 3. Sri N.K. Chatterjee and Sri S.D. Dube, learned counsels for the respondents are not present. 4. This first appeal from order has been preferred for enhancement of compensation awarded under the award of Motor Accident Claims Tribunal dated 26.8.2010 passed in Motor Accident Claim Petition No. 1006 of 2008. 5. The total compensation that has been awarded is Rs. 18,71,146/- alongwith the interest @ 6% from the date of presentation of application till the actual payment of the compensation. The appellants have assailed the award on the point of computation of compensation and have thus claimed enhancement of compensation and thereby modification of the award. 6. The undisputed facts that have emerged out of the pleadings and award are that the deceased Tapesh Kumar while on board of Santro Car No. WB 02 Q 8264 met a fatal accident on Delhi-Meerut Highway in the night of 15.9.2008. The accident occurred because of the standing truck bearing No. HR 58 A 2127 along the divider of the road which could not be sited by Tapesh Kumar who was driving the Car and the Car dashed into the truck. The truck was loaded with iron bars that fatally injured both husband and wife who died on the spot. At the time of death the deceased Tapesh Kumar was aged about 35 years and he was working in Oil and Natural Gas Corporation (ONGC), Mumbai as Deputy Superintending Engineer and his monthly income at the time of accident was Rs. 1,00,088.55 paise. The deceased was survived by old aged parents Nand Lal and Smt. Parvati Devi and four brothers namely Anil, Deepak, Vijay and Ajay. 7. On the issue of computation of compensation, two fold argument was led by the Insurance Company before the Tribunal: firstly, the argument was that the monthly salary of the deceased included additional allowances and therefore, only net income should be assessed; and secondly, there should be 2/3rd deduction because both husband and wife had died in the accident and direct dependents were only the parents. 8. 8. Considering the above two arguments and relying upon two judgments of the Apex Court in the case of Raghuvir Singh v. Hart Singh, 2009 (2) ACCD 1120 (SC) and National Insurance Company Ltd. v. Indira Srivastava, 2008 ACJ 614 (SC), the Tribunal deducted only the income tax from the salary and thus salary was assessed as Rs. 77,870.72 paise and accordingly the annual income was assessed as Rs. 9,34,448.60 paise. The Tribunal made 1/2 deduction towards personal expenses of the deceased and his deceased wife and so after deducting 1/2 of the amount, the annual income was assessed to be Rs. 4,67,224.30 paise. Thereafter, the Tribunal proceeded to apply the multiplier on the basis of age of the parents and accordingly applied the multiplier of 8 and assessed the annual income as Rs. 37,37,792/-. Towards the funeral expenses Rs. 2,000/- was awarded and also for the loss of estate Rs. 2,000/- was awarded. Thus, total income was calculated as Rs. 37,42,292/-. 9. Since it was a case of contributory negligence, so 50% of the liability was fastened upon the car driver who is the deceased himself and accordingly 50% of the amount of total compensation assessed as Rs. 18,71,146/-, was directed to be awarded. 10. Assailing the aforesaid computation, three fold arguments have been led by the learned counsel for the appellants: (i) the multiplier has wrongly been applied of the dependants whereas, the multiplier should have been considering the age of deceased at the time of accident; (ii) no amount has been added towards future prospects; (iii) the amount towards loss of estate and funeral is too meager an amount. 11. Learned counsel for the appellants in support of his arguments has relied upon the judgment of Apex Court in National Insurance Company Limited v. Pranay Sethi and others, (2017) 16 SCC 680 . 12. Per contra the argument of learned counsel for the Insurance Company is that the Tribunal has rightly applied the multiplier and has correctly calculated the compensation and the award does not warrant any interference. 13. Having heard learned counsels for the parties and their respective arguments raised across the bar and having gone through the judgments, we find that three points raised by the learned counsel for the appellants do require consideration. 14. 13. Having heard learned counsels for the parties and their respective arguments raised across the bar and having gone through the judgments, we find that three points raised by the learned counsel for the appellants do require consideration. 14. Coming to the first argument regarding application of multiplier, we are reminded of the judgment of Apex Court in the case of Sarla Verma (Smt.) and others v. Delhi Transport Corporation and another, (2009) 6 SCC 121 , in which vide para 42 the Court has held thus: "42. 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 of 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, M-13 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 years to 70 years." 15. The Apex Court in the case of Pranay Sethi (supra) has affirmed the judgment of Sarla Verma (supra) and has held that since the multiplier has already been fixed in Sarla Verma which has been approved in Reshma Kumari. Applying the aforesaid principle and considering the age of deceased being 35 years, we are of the considered opinion that the multiplier of 16 should have been applied and therefore, we find merit in the argument of learned counsel for the appellants that multiplier of 8 has wrongly been applied by the Tribunal. 16. Coming to the second question relating the future prospects, we find that the aspect of future prospects has also been considered in detail by the Supreme Court in the case of Pranay Sethi (supra). In Pranay Sethi (supra) Supreme Court has provided for 50% future prospects for a person aged below 40 years. 17. In so far as the deduction is concerned, we are satisfied with 1/2 deduction because both husband and wife have died and virtually left behind their aged parents. In Pranay Sethi (supra) Supreme Court has provided for 50% future prospects for a person aged below 40 years. 17. In so far as the deduction is concerned, we are satisfied with 1/2 deduction because both husband and wife have died and virtually left behind their aged parents. The other brothers cannot be claimed to be direct dependents upon the deceased brother nor, any evidence has been led to prove that other brothers were equally dependents like parents. 18. On the question of loss of estate and funeral expenses also we are of the opinion that the formula applied in Pranay Sethi (supra) should be made applicable in which Rs. 15,000/- in each of those categories have been provided for. vide para 52 and 59 of the judgment in Pranay Seth is case, the Apex Court has held thus: "52. As far as the conventional heads are concerned, we find it difficult to agree with the view expressed in Rajesh. It has granted Rs. 25,000/- towards funeral expenses, Rs. 1,00,000/- loss of consortium and Rs. 1,00,000/- towards loss of care and guidance for minor children. The head relating to loss of care and minor children does not exist. Though Rajesh refers to Santosh Devi, it does not seem to follow the same. The conventional and traditional heads, needless to say, cannot be determined on percentage basis because that would not be an acceptable criterion. Unlike determination of income, the said heads have to be quantified. Any quantification must have a reasonable foundation. There can be no dispute over the fact that price index, fall in bank interest, escalation of rates in many a field have to be noticed. The Court cannot remain oblivious to the same. There has been a thumb rule in this aspect Otherwise, there will be extreme difficulty in determination of the same and unless the thumb rule is applied, there will be immense variation lacking any kind of consistency as a consequence of which, the orders passed by the Tribunals and Courts are likely to be unguided. Therefore, we think it seemly to fix reasonable sums. It seems to us that reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs. 15,000/-, Rs. 40,000/- and Rs. 15,000/- respectively. The principle of revisiting the said heads is an acceptable principle. But the revisit should not be fact-centric or quantum-centric. Therefore, we think it seemly to fix reasonable sums. It seems to us that reasonable figures on conventional heads, namely, loss of estate, loss of consortium and funeral expenses should be Rs. 15,000/-, Rs. 40,000/- and Rs. 15,000/- respectively. The principle of revisiting the said heads is an acceptable principle. But the revisit should not be fact-centric or quantum-centric. We think that it would be condign that the amount that we have quantified should be enhanced on percentage basis in every three years and the enhancement should be at the rate of 10% in a span of three years. We are disposed to hold so because that will bring in consistency in respect of those heads. "59. In view of the aforesaid analysis, we proceed to record our conclusions: 59.1. The two-Judge Bench in Santosh Devi v. National Insurance Co. Ltd., (2012) 6 SCC 421 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, 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. 59.2. As Rajesh v. Rajbir Singh, (2013) 9 SCC 54 , has not taken note of the decision in Reshma Kumari, which was delivered at earlier point of time, the decision in Rajesh (supra) is not a binding precedent. 59.3. 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 to 50 years. In case the deceased was between the age of 50 to 60 years, the addition should be 15%. Actual salary should be read as actual salary less tax. 59.4. 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 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. An addition of 25% where the deceased was between the age of 40 to 50 years and 10% where the deceased was between the age of 50 to 60 years should be regarded as the necessary method of computation. The established income means the income minus the tax component. 59.5. For determination of the multiplicand, the deduction for personal and living expenses, the Tribunals and the Courts shall be guided by paragraphs 30 to 32 of Sarla Verma which we have reproduced hereinbefore. 59.6. The selection of multiplier shall be as indicated in the Table in Sarla Verma read with paragraph 42 of that judgment. 59.7. The age of the deceased should be the basis for applying the multiplier. 59.8. Reasonable figures on conventional heads, namely, loss of 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% in every three years." (emphasis added)" 19. Thus, in view of the above principles, we made a pointed query to the learned counsel for the Insurance Company as to what argument he would lead to counter the argument advanced by learned counsel for the appellants, the learned counsel appearing for Insurance Company has only submitted that the determination of compensation has been made as per law that existed at that point of time and therefore, appellants should not be benefited under the subsequent judgment. 20. To the above view, we do not subscribe because the law declared by Apex Court is taken to be a law always in existence. In matter of beneficial legislation where the issue is of quantum of compensation, the Court should always take pragmatic view and we find no reason as to why the principles laid in Pranay Sethi (supra) may not be made applicable to the case in hand while determining compensation, and accordingly we hereby direct for the award of compensation to include 50% towards future prospects of the income of the deceased, Rs. 15,000/- each for funeral expenses and loss of estate. 21. We have already held above, the multiplier of 16 corresponding to the age of deceased shall be applicable. Accordingly, therefore, the award of the Tribunal dated 26.8.2010 is modified by enhancement. 15,000/- each for funeral expenses and loss of estate. 21. We have already held above, the multiplier of 16 corresponding to the age of deceased shall be applicable. Accordingly, therefore, the award of the Tribunal dated 26.8.2010 is modified by enhancement. Now the compensation will be transcribed as under: Income has salaried employees of the deceased minus taxes Rs.77,871/-p.m. Rs.9,34,452/-p.m. Future prospectus 50% of Rs.9,34,452/- Rs.4,67,226/- Total Income Rs.14,01,678/- Deduction towards personal expenses ½ of total income Rs.7,00,839/- Dependency Rs.7,00,839/- Multiplier 16 Compensation Rs. 7,00,839/-x16 Rs.112,13,424/- Funeral Expenses Rs.15,000/- Loss of Estate Rs.15,000/- Total Compensation Rs.112,43,424/- 22. Thus, the compensation awarded by the Court below is enhanced from Rs. 18,71,146/- to Rs. 112,43,424/- with 6% per annum rate of interest from the date of presentation of the application till actual payment is made. 23. In view of the above, the appeal stands allowed. The compensation awarded to the claimants/appellants under the order of the Tribunal dated 26.8.2010 is accordingly enhanced and award stands modified to the extent indicated herein above.