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2022 DIGILAW 363 (ALL)

Servesh Devi v. Ankush Agar

2022-03-11

SALIL KUMAR RAI

body2022
JUDGMENT : 1. This is a claimants' appeal under Section 173 of the Motor Vehicles Act, 1988 (hereinafter referred to as, 'Act, 1988') against the judgment and award dated 17.9.2015 passed by the Motor Accident Claims Tribunal, Aligarh in Motor Accident Claim Petition No. 460 of 2014 (Smt. Sarvesh Devi & Ors. vs. Ankush Agarwal & Ors). The appeal is for enhancement of compensation. The office reports dated 16.12.2019, 24.3.2021 and 10.3.2022 state that notices by registered post as well as ordinary post were issued to the opposite parties but no acknowledgment has been returned nor any undelivered cover has been received back. In view of the aforesaid, service of notice on the opposite parties is deemed sufficient. No one has put in appearance on behalf of the opposite parties. No cross appeal or cross objection has been filed by the opposite parties who are the owners, drivers and the Insurance Company. 2. The facts of the case are that Motor Accident Claim Petition No. 460 of 2014 was instituted by the claimants- appellants under Section 166 of the Act, 1988 alleging that one Har Prasad, working as Raaj Mistri, died in an accident caused due to rash and negligent driving of vehicle, i.e., Truck No. U.P. 81 A.F.-3896 (hereinafter referred to as, ''the offending vehicle') by its driver. The accident happened on 21st June, 2014 at 07:00 p.m. The appellant no. 1 is the wife of the deceased, the appellant nos. 2 to 4 are the sons and daughter of the deceased. The appellant nos. 2 to 4 were minor at the time of the institution of the claim petition. The appellant no. 5 is the mother of the deceased. The appellant no. 5 died during the pendency of the case and her legal representatives are already on record as appellant nos. 1 to 4. The opposite party no. 1 is the owner of the vehicle, the opposite party no. 3 is the driver of the vehicle and the opposite party no. 2, i.e., Mega General Insurance Company Limited is the insurer of the offending vehicle. It was stated in the claim petition that at the time of accident, the deceased was 34 years old and earned Rs.15,000/- per month and had no bad habits. On the aforesaid facts, the claimants claimed a compensation of Rs.31,10,000/- with 12% interest from the date of accident. 3. It was stated in the claim petition that at the time of accident, the deceased was 34 years old and earned Rs.15,000/- per month and had no bad habits. On the aforesaid facts, the claimants claimed a compensation of Rs.31,10,000/- with 12% interest from the date of accident. 3. In their written statements the opposite parties denied that the accident was caused due to rash and negligent driving of the offending vehicle and pleaded that the accident occurred due to the negligence of the deceased. In its written statement, the opposite party no. 2, i.e., the Insurance Company denied the factum of accident and also its liability to pay compensation. 4. The Tribunal framed four Issues. Issue no. 1 was regarding the factum of accident and the negligence of the driver of the offending vehicle in causing the accident, Issue no. 2 was as to whether, at the time of accident, the driver of the offending vehicle had a valid driving licence, Issue no. 3 was as to whether at the time of accident, the offending vehicle was insured with opposite party no. 2 and Issue no. 4 was regarding the amount of compensation payable to the claimants and the defendant liable to pay compensation. 5. The Tribunal by its award dated 17.9.2015 decided Issue no. 1 in favour of the claimants and held that Har Prasad had died because of injuries caused in the accident occurring due to rash and negligent driving of the offending vehicle. Issue nos. 2 and 3 were decided in favour of the owner of the vehicle, i.e., it was held by the Tribunal that at the time of accident, the driver of the offending vehicle had a valid driving licence and the offending vehicle was insured with opposite party no. 2, i.e., the Insurance Company. So far as Issue no. 4 is concerned, the Tribunal granted compensation of Rs. 4,40,000/- with 7% simple interest from the date of institution of the claim petition till the payment of compensation on the notional income of Rs.3,000/- per month after deducting 1/4 as personal expenses of the deceased. The Tribunal, while determining the multiplicand, rejected the plea of the claimants that future prospects had to be added in the national income of the deceased while determining the multiplicand. The Tribunal, while determining the multiplicand, rejected the plea of the claimants that future prospects had to be added in the national income of the deceased while determining the multiplicand. The Tribunal applied a multiplier of 15 for determining the total compensation after holding that the deceased was 40 years old at the time of accident. 6. As no cross appeal or cross objection has been filed by the opposite parties and no one has appeared on behalf of the opposite parties to contest the findings of the Tribunal, therefore, the findings of the Tribunal on Issue nos. 1, 2 and 3 have become final. 7. The appeal is for enhancement of compensation. It was argued by the counsel for the claimants that the Tribunal has wrongly determined the compensation on the notional income of Rs.100/- per day. It was argued that the accident occurred in 2014 and according to the judgment of this Court in New India Assurance Co. Ltd. vs Smt. Resha Devi & Ors. 2017 (3) ADJ 685 , the multiplicand should have been determined on a notional income of Rs.200/- per day. It was further argued that while quantifying the multiplicand, future prospects were also to be added to the notional income of the deceased. It was also argued that the Tribunal has awarded a very meager amount for loss of spousal consortium and has erred in not grating any compensation for loss of parental and filial consortium to the claimant nos. 2 to 5. It was further argued that under Rule 220-A of the U.P. Motor Vehicle Rules, 1998 (hereinafter referred to as, ''Rules, 1998'), the claimants were also entitled to compensation for loss of love and affection and the compensation granted to the claimants for funeral expenses is also not in accordance with the judgment of the Supreme Court in National Insurance Company Ltd. vs Pranay Sethi & Ors. (2017) 16 SCC 680 . 8. The counsel for the appellants does not challenge the findings of the Tribunal regarding the age of the deceased which the Tribunal held to be 40 years and has also not challenged the deductions of 1/4 as personal expenses of the deceased. 9. I have considered the submissions of the counsel for the appellants and perused the records. 10. 8. The counsel for the appellants does not challenge the findings of the Tribunal regarding the age of the deceased which the Tribunal held to be 40 years and has also not challenged the deductions of 1/4 as personal expenses of the deceased. 9. I have considered the submissions of the counsel for the appellants and perused the records. 10. A reading of the award of the Tribunal and a perusal of the records indicate that the claimants had pleaded that before his death in the accident, the deceased worked as Raj Mistri and was earning Rs.15,000/- per month. However, the claimants could not produce any evidence to prove their plea that before his death, the deceased was earning Rs.15,000/- per month. In view of the aforesaid, the compensation is to be determined on the notional income of the deceased. The Tribunal has determined the notional income of the deceased as Rs.100/- per day, i.e., Rs.3,000/- per month. In Smt. Resha Devi (supra), a Division Bench of this Court held that the notional income of unskilled labour cannot be taken to be less than Rs.200/- per day and the presumption of Rs.100/- per day as notional income, even for an unskilled labour in the year 2014, would be frugal and by no stretch of imagination can be considered to be just because even the minimum wages fixed by the State Government were much higher than that. The observations of this Court in Paragraph Nos. 9 to 11 are reproduced below :- "9. The next submission of the learned counsel for the appellant that income of Rs.100/- per day presumed by the tribunal is extremely on higher side is without any force and not liable to be accepted. Tribunal in recording the said claim has relied upon the judgment of the Hon'ble Apex Court in the case of Laxmi Devi and another Vs. Mohammad Tabbar and others, 2008 (2) TAC 394 SC wherein notional income to unskilled labour was presumed to be Rs.100/- per day. Much water has flown since 2008. It is a matter of common knowledge that with the rise in price index, there has been considerable increase in the wages of salaried as well as self employed person. The average income of even a daily labour in 2014 when the accident took place cannot be presumed to be less than Rs.200/- per day. It is a matter of common knowledge that with the rise in price index, there has been considerable increase in the wages of salaried as well as self employed person. The average income of even a daily labour in 2014 when the accident took place cannot be presumed to be less than Rs.200/- per day. In our considered opinion, the tribunal committed a manifest error of law in presuming the notional income of the deceased to be Rs.100/- per day. 10. In the case of Santosh Devi Vs. National Insurance Company Limited and others (2012) 6 SCC 421 in paragraph 17 of the reports has observed as under : "17. Although the wages/income of those employed in organised sectors has not registered a corresponding increase and has not kept pace with the increase in the salaries of the government employees and those employed in private sectors, but it cannot be denied that there has been incremental enhancement in the income of those who are self-employed and even those engaged on daily basis, monthly basis or even seasonal basis. We can take judicial notice of the fact that with a view to meet the challenges posed by high cost of living, the persons falling in the latter category periodically increase the cost of their labour. In this context, it may be useful to give an example of a tailor who earns his livelihood by stitching clothes. If the cost of living increases and the prices of essentials go up, it is but natural for him to increase the cost of his labour. So will be the cases of ordinary skilled and unskilled labour, like, barber, blacksmith, cobbler, mason, etc. 11. There can be no exact uniform rule for measuring the value of the human life and the measure of damages cannot be arrived at by precise mathematical calculations. Obviously award of damages would depend upon the particular facts and circumstances of the case but the element of fairness in the amount of compensation so determined is the ultimate guiding factor. In such view of the matter, presumption of Rs.100/- per day as notional income even for a unskilled labour in the year 2014 appears to us to be frugal and by no stretch of imagination to be just even the minimum wages fixed by the State Government is much higher than that looking to the rise in cost index. In such view of the matter, presumption of Rs.100/- per day as notional income even for a unskilled labour in the year 2014 appears to us to be frugal and by no stretch of imagination to be just even the minimum wages fixed by the State Government is much higher than that looking to the rise in cost index. We are of the considered upon that notional income of an unskilled labour could not be less than Rs.200/- per day." (Emphasis added) 11. In the present case also, the accident occurred in 2014. Following the judgment of the Division Bench of this Court, it would be just and fair to treat the notional income of the deceased as Rs. 200/- per day, i.e., Rs.6,000/- per month. 12. So far as future prospects are concerned, apparently the award of the Tribunal is contrary to the judgment of the Supreme Court in Pranay Sethi (supra). In Pranay Sethi (supra), it was held that if the deceased was self-employed or on a fixed salary, an addition of 25% should be made in the established income of the deceased to determine the multiplicand if the deceased was between the age of 40 to 50 years. In Pranay Sethi (supra), the Supreme Court held that there was no rationale not to add future prospects in the income of the self-employed or a person who is on a fixed salary and such denial would be unjust. In this context, the observations of the Supreme Court in Paragraph nos. 57 and 59.4 are reproduced below :- "57. Having bestowed our anxious consideration, we are disposed to think when we accept the principle of standardization, there is really no rationale not to apply the said principle to the self-employed or a person who is on a fixed salary. To follow the doctrine of actual income at the time of death and not to add any amount with regard to future prospects to the income for the purpose of determination of multiplicand would be unjust. The determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as postulated under Section 168 of the Act. In case of a deceased who had held a permanent job with inbuilt grant of annual increment, there is an acceptable certainty. The determination of income while computing compensation has to include future prospects so that the method will come within the ambit and sweep of just compensation as postulated under Section 168 of the Act. In case of a deceased who had held a permanent job with inbuilt grant of annual increment, there is an acceptable certainty. But to state that the legal representatives of a deceased who was on a fixed salary would not be entitled to the benefit of future prospects for the purpose of computation of compensation would be inapposite. It is because the criterion of distinction between the two in that event would be certainty on the one hand and staticness on the other. One may perceive that the comparative measure is certainty on the one hand and uncertainty on the other but such a perception is fallacious. It is because the price rise does affect a self-employed person; and that apart there is always an incessant effort to enhance one's income for sustenance. The purchasing capacity of a salaried person on permanent job when increases because of grant of increments and pay revision or for some other change in service conditions, there is always a competing attitude in the private sector to enhance the salary to get better efficiency from the employees. Similarly, a person who is self-employed is bound to garner his resources and raise his charges/fees so that he can live with same facilities. To have the perception that he is likely to remain static and his income to remain stagnant is contrary to the fundamental concept of human attitude which always intends to live with dynamism and move and change with the time. Though it may seem appropriate that there cannot be certainty in addition of future prospects to the existing income unlike in the case of a person having a permanent job, yet the said perception does not really deserve acceptance. We are inclined to think that there can be some degree of difference as regards the percentage that is meant for or applied to in respect of the legal representatives who claim on behalf of the deceased who had a permanent job than a person who is self-employed or on a fixed salary. But not to apply the principle of standardization on the foundation of perceived lack of certainty would tantamount to remaining oblivious to the marrows of ground reality. But not to apply the principle of standardization on the foundation of perceived lack of certainty would tantamount to remaining oblivious to the marrows of ground reality. And, therefore, degree-test is imperative. Unless the degree-test is applied and left to the parties to adduce evidence to establish, it would be unfair and inequitable. The degree-test has to have the inbuilt concept of percentage. Taking into consideration the cumulative factors, namely, passage of time, the changing society, escalation of price, the change in price index, the human attitude to follow a particular pattern of life, etc., an addition of 40% of the established income of the deceased towards future prospects and where the deceased was below 40 years and an addition of 25% where the deceased was between the age of 40 to 50 years would be reasonable. 58. The controversy does not end here. The question still remains whether there should be no addition where the age of the deceased is more than 50 years. Sarla Verma thinks it appropriate not to add any amount and the same has been approved in Reshma Kumari. Judicial notice can be taken of the fact that salary does not remain the same. When a person is in a permanent job, there is always an enhancement due to one reason or the other. To lay down as a thumb rule that there will be no addition after 50 years will be an unacceptable concept. We are disposed to think, there should be an addition of 15% if the deceased is between the age of 50 to 60 years and there should be no addition thereafter. Similarly, in case of self-employed or person on fixed salary, the addition should be 10% between the age of 50 to 60 years. The aforesaid yardstick has been fixed so that there can be consistency in the approach by the tribunals and the courts. 59. In view of the aforesaid analysis, we proceed to record our conclusions: 59.1. The two-Judge Bench in Santosh Devi 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. 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 has not taken note of the decision in Reshma Kumari, which was delivered at earlier point of time, the decision in Rajesh 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. The established income means the income minus the tax component." (Emphasis added) 13. However, Rule 220-A (3) of the Rules, 1998 provides that future prospects of a deceased shall be added in the actual salary or minimum wages of the deceased as under :- (i) Below 40 years of age 50% of the salary (ii) Between 40-50 years of age 30% of the salary (iii) More than 50 years of age 20% of the salary (iv) When wages not sufficiently proved. 50% towards inflation and price index. 14. The notional income of the deceased is determined on the basis of minimum wages and thus in accordance with the Rules, 1998, 30% has to be added as future prospects in the notional income of the deceased while determining the multiplicand as deceased was 40 years old. 15. The Supreme Court in Pranay Sethi (supra) referred to only three conventional heads, namely, loss of estate, loss of consortium and funeral expenses while determining the compensation payable under the Act, 1988. 15. The Supreme Court in Pranay Sethi (supra) referred to only three conventional heads, namely, loss of estate, loss of consortium and funeral expenses while determining the compensation payable under the Act, 1988. In Pranay Sethi (supra), it was further held that the compensation under the aforesaid conventional heads should be Rs.15,000/-, Rs.40,000/- and Rs.15,000/-, respectively. However, in Magma General Insurance Company Ltd. vs. Nanu Ram 2018 SCC OnLine SC 1546, the Supreme Court awarded compensations for loss of love and affection and for loss of consortium. The compensation for loss of love and affection was determined as Rs.50,000/- and the compensation for loss of consortium, in accordance with Pranay Sethi (supra), was determined at Rs.40,000/-. The compensation under the aforesaid heads and for the said amount were paid separately to each of the claimants by the Supreme Court. However, subsequently, the Supreme Court in United India Insurance Company Ltd. vs. Satinder Kaur @ Satwinder Kaur & Ors., AIR (2020) SC 3076 held that loss of love and affection is included in loss of consortium and, therefore, there is no justification to award compensation towards loss of love and affection as a separate head. The aforesaid judgment was followed by the Supreme Court in The New India Assurance Company Ltd. vs. Smt. Somwati & Ors., (2020) 9 SCC 644 . However, Rule 220-A(4) of the Rules, 1998 provides for seperate compensation for 'loss of love and affection' and 'loss of consortium'. Rule 4 of the Rules, 1998 is reproduced below :- (4) The non-pecuniary damages shall also be payable in the compensation as follow :- (i) Compensation for loss of estate Rs.5,000 to Rs.10,000 (ii) Compensation for loss of consortium Rs.5,000 to Rs.10,000 (iii) Compensation for loss of love and affection Rs.5,000 to Rs.15,000 (iv) Funeral expenses costs of transportation of body Rs.5,000 or actual expenses whichever is less (v) Medical expenses : actual expenses proved to the satisfaction of the Claims Tribunal. 16. A reading of the judgments of the Supreme Court in Satinder Kaur (supra) and Smt. Somwati (supra) do not indicate that Rules, 1998 were brought to the notice of the Supreme Court in the aforesaid case. The Supreme Court in New India Assurance Company Ltd. vs. Urmila Shukla & Ors. 16. A reading of the judgments of the Supreme Court in Satinder Kaur (supra) and Smt. Somwati (supra) do not indicate that Rules, 1998 were brought to the notice of the Supreme Court in the aforesaid case. The Supreme Court in New India Assurance Company Ltd. vs. Urmila Shukla & Ors. 2021 SCC OnLine SC 822 has held that if an indicia is made available in the form of a statutory instrument which affords a favourable treatment, the decision in Pranay Sethi (supra) cannot be taken to have limited the operation of such statutory provision especially when the validity of the Rules was not put under any challenge. It was further observed by the Supreme Court that if a statutory instrument has devised a formula which affords better or greater benefit, such statutory instrument must be allowed to operate unless the statutory instrument is otherwise found to be invalid. The observations of the Court from paragraphs 8 to 11 are reproduced below :- "8. It is submitted by Mr. Rao that the judgment in Pranay Sethi does not show that the attention of the Court was invited to the specific rules such as Rule 3(iii) which contemplates addition of 20% of the salary as against 15% which was stated as a measure in Pranay Sethi. In his submission, since the statutory instrument has been put in place which affords more advantageous treatment, the decision in Pranay Sethi ought not to be considered to limit the application of such statutory Rule. 9. It is to be noted that the validity of the Rules was not, in any way, questioned in the instant matter and thus the only question that we are called upon to consider is whether in its application, sub-Rule 3(iii) of Rule 220A of the Rules must be given restricted scope or it must be allowed to operate fully. 10. The discussion on the point in Pranay Sethi was from the standpoint of arriving at "just compensation" in terms of Section 168 of the Motor Vehicles Act, 1988. 11. If an indicia is made available in the form of a statutory instrument which affords a favourable treatment, the decision in Pranay Sethi cannot be taken to have limited the operation of such statutory provision specially when the validity of the Rules was not put under any challenge. 11. If an indicia is made available in the form of a statutory instrument which affords a favourable treatment, the decision in Pranay Sethi cannot be taken to have limited the operation of such statutory provision specially when the validity of the Rules was not put under any challenge. The prescription of 15% in cases where the deceased was in the age bracket of 50-60 years as stated in Pranay Sethi cannot be taken as maxima. In the absence of any governing principle available in the statutory regime, it was only in the form of an indication. If a statutory instrument has devised a formula which affords better or greater benefit, such statutory instrument must be allowed to operate unless the statutory instrument is otherwise found to be invalid." (Emphasis added) 17. In light of the judgment of the Supreme Court in Urmila Shukla (supra) read with Rules, 1998, it is held that the claimants were entitled to separate compensation for loss of consortium and for loss of love and affection. 18. On applying the aforesaid principles, it is apparent that the compensation awarded to the claimants by the Tribunal is too meager and is to be enhanced. The compensation payable to the claimants is re-determined as follows :- 1. Notional income of the deceased Rs.200/- per day, i.e., Rs.6,000/- per month and Rs.72,000/- per annum. 2. 1/4 deductions for the personal and living expenses of the deceased Rs.18,000/- (72,000/4) 3. The dependency of the claimants on the deceased Rs.54,000/- (Rs.72,000/- - Rs.18,000/-) 4. Future prospects = 30%, i.e., 54,000 x 30% Rs.16200/- 5. Thus, multiplicand = 54,000 + 16,200 Rs.70,200/- 6. Applying the multiplier of 15, the pecuniary damage would be = 70,200 x 15 Rs.10,53,000/- 7. Compensation under the conventional heads - (i) Loss of estate Rs.15,000/- (ii) Funeral expenses Rs.15,000/- (iii) Loss of filial consortium to appellant no. 5 Rs.40,000/- (iv) Loss of spousal consortium to appellant no. 1 Rs.40,000/- (v) Loss of parental consortium to appellant nos. 2 to 4 Rs.40,000 x 3 = Rs.1,20,000/- (Rs.40,000/- each) (vi) Loss of love and affection to appellant nos. 1 to 5 Rs.50,000 x 5 = 2,50,000/- (Rs.50,000/- each) Thus, the total compensation payable to the claimants Rs.15,33,000/- 19. It is held that the claimants are entitled to a compensation of Rs.15,33,000/- and the award of the Tribunal is modified to the aforesaid extent. 1 to 5 Rs.50,000 x 5 = 2,50,000/- (Rs.50,000/- each) Thus, the total compensation payable to the claimants Rs.15,33,000/- 19. It is held that the claimants are entitled to a compensation of Rs.15,33,000/- and the award of the Tribunal is modified to the aforesaid extent. The claimants shall be entitled to interest at the rate of 7% per annum as awarded by the Tribunal. 20. The balance amount / enhanced compensation so far as pecuniary damages and compensation for loss of estate and for funeral expenses alongwith the interest on the same shall be paid to appellant no. 1 who is the widow of the deceased. The appellant no. 1 shall also be entitled to get the enhanced compensation awarded for loss of spousal consortium and Rs.50,000/- for loss of love and affection along with the interest payable on the same. The appellant nos. 2, 3 and 4 shall be entitled to compensation for payment of loss of parental consortium as awarded above and for loss of love and affection as awarded above, i.e., Rs.40,000/- and Rs.50,000/- each under the aforesaid heads along with the interest payable on the same. The appellant no. 5 died during the pendency of the present appeal and, therefore, the compensation awarded to her for loss of love and affection and for loss of consortium along with the interest accruing on the same shall be distributed equally between respondent nos. 1 to 4. 21. The appeal is allowed and the award of the Tribunal is modified to the extent indicated above. The balance amount / excess amount as awarded by this Court in the present appeal shall be deposited by the Mega General Insurance Company Ltd., i.e., opposite party no. 2 in the Tribunal within four months. The amount so deposited by the Mega General Insurance Company Ltd. under the present order of this Court shall be deposited by the Motor Accident Claims Tribunal, Aligarh in the highest interest bearing fixed deposit schemes, either of the post office or of any nationalized bank. The receipts of the fixed deposit shall be handed over to the appellant no. 1, who is also the guardian of appellant nos. 2 to 4, who shall be entitled to withdraw the maturity amount when the fixed deposits mature. The maturity amount shall be credited by the bank/post office in any savings account of the appellants. The receipts of the fixed deposit shall be handed over to the appellant no. 1, who is also the guardian of appellant nos. 2 to 4, who shall be entitled to withdraw the maturity amount when the fixed deposits mature. The maturity amount shall be credited by the bank/post office in any savings account of the appellants. The concerned bank or post office shall not permit any loan or advance against the fixed deposits made in favour of the appellants. The Tribunal, while depositing the amount in any fixed deposit scheme, shall communicate the directions issued by this Court to the concerned bank/post office. 22. With the aforesaid directions and observations, the appeal is allowed. Parties shall bear their own cost. 23. The office shall transmit the records of the case to the Tribunal, at the earliest.