Shriram General Insurance ... vs Smt. Sangeeta Srivastava And Ors.
2016 Latest Caselaw 3488 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 

Reserved on 13.5.2016
 
Court No. - 24
 
Case :- FIRST APPEAL FROM ORDER No. - 1098 of 2015
 


Appellant :- Shriram General Insurance Company Ltd.Thru Manager
 

Respondent :- . Sangeeta Srivastava And Ors.
 

Counsel for Appellant :-  Dinesh Kumar

 
Counsel for Respondent :- Sandeep Kumar Agrawal,Vishal Tahlani


 

 
Hon'ble Dr. Devendra Kumar Arora,J.

 
Hon'ble Dr. Vijay Laxmi,J.

(Delivered by Hon'ble Dr. Vijay Laxmi,J.)

1. Appellant-Shriram General Insurance Company Ltd. has filed the instant First Appeal From Order under Section 173 of the Motor Vehicles Act, 1988 against the judgment and award dated 04.09.2015 passed by Motor Accident Claim Tribunal/ Additional District Judge, Room No.8, Lucknow [hereinafter referred to as "Tribunal"], in Claim Petition No. 100050 of 2014 : Sangeeta Srivastava Vs. Amit Saran and others, whereby the Tribunal has awarded a sum of Rs. 55,42,270/- along with interest @ 7% per annum from the date of filing of the claim petition in favour of the claimants (respondents No.1 to 5 herein) under the following heads:-

1. Loss of dependency 	  : 	Rs. 55,17,270/-
 

 
2. Funeral Expenses    	  :	Rs. 5000/-
 

 
3. Loss of Estate	    	  :	Rs. 10,000/-
 

 
4. Loss of Love & Affection :	Rs. 5000/-
 

 
5. Additional compensation
 
                 for loss of estate		  :	Rs.5000/-
 

 

 

2. The case related to death of an Assistant Teacher of Madhyamik Vidyalaya, who died in an accident on 21.12.2013 at about 5.15 p.m. when a Mini Truck No. UP 78 AT 5541 hit his Scooty from behind on which he was riding. He succumbed to injuries on the spot. Respondents no. 1 to 5, the legal heirs of the deceased, Prabodh Chandra, filed Claim Petition No. 100050/2014 before the Tribunal under Section 166 of the Motor Vehicles Act 1988 (for brevity, the 'Act') for grant of compensation amounting to Rs.85,00,000/- along with interest @ 24% from the date of filing of the claim petition.

3. On the basis of evidence brought on record, the Tribunal held that the accident took place due to negligent driving of Mini Truck driver and awarded a sum of Rs.55,42,270/- along with interest @ 7% per annum from the date of filing of the claim petition. As is evincible from the award passed by the Tribunal, the aforesaid amount was determined as compensation on the basis that the deceased was in the age group of 40 to 45 and his monthly income was Rs.33,449/- and annual income was Rs.4,01,388/-. The Tribunal deducted 10% amount i.e. Rs.24,139/- towards income tax and added 30% amount i.e. Rs. 1,13,375/- towards future prospects. Towards personal deduction 1/4th of amount was deducted and the multiplier of 15 was applied to have loss of dependency. Apart there from, the amount of Rs.25,000/- was paid under conventional heads of love and affection etc. The insurer was directed to deposit the amount within 60 days before the Tribunal.

4. Learned Counsel for the Insurance Company does not dispute the factum of accident. It is contended that the amount of compensation is excessive and unjust.

5. The main ground of challenge raised by the appellant- Insurance Company is that the compensation awarded is exorbitant and excessive. It is argued that the wife of the deceased Smt. Sangeeta Srivastava (respondent No.1 herein) was having self income from Government job as a teacher in the Primary School and as such she was not dependent upon the income of the deceased. The father of the deceased Mr. Tej Bahadur Lal (respondent No.4 herein) was also a retired person from railway service drawing pension of about Rs.30,000/- per month, therefore, respondents no.1 and 4 were not dependent upon the income of the deceased but the Tribunal, while ignoring these facts, erred in deducting 1/4th in place of 1/3rd towards personal expenses of the deceased. Hence the impugned award is arbitrary.

6. Elaborating his submissions, learned Counsel for the appellant-Insurance Company has contended that the date of birth of the deceased was 24.07.1971 and as such on the date of the incident i.e. 21.12.2013, his actual age was 42 years 5 months. But the Tribunal, on ignoring this fact, erred in coming to the conclusion that since the age of the deceased at the time of accident was between 40 to 45, therefore, multiplier of '15' would be applied, though as per Smt. Sarla Verma and others v Delhi Transport Corporation and another : AIR 2009 (6) SC 121, multiplier available to the deceased was '14'. He submits that as per the verdict of the Apex Court, the compensation towards accidental death is not a Bonanza, but it is a relief to the family of the victim. The Tribunal has failed to take into account this aspect of the matter, hence, the impugned award is liable to be set aside.

7. Per contra, learned Counsel for the respondents-claimants has submitted that the findings recorded by the Tribunal are based on cogent evidence and cannot be said to be perverse. The Tribunal has awarded just compensation after taking into consideration every aspect of the matter and the multiplier has been applied as per Schedule under Motor Vehicles Act.

8. We have heard the rival submissions of the learned Counsel for the parties and gone through the record. The appellant-Insurance Company has challenged the impugned award on two counts, namely, (1) the Tribunal had wrongly applied multiplier; and (2) the Tribunal had erred in making 1/4th deduction towards personal expenses of the deceased in place of 1/3rd.

9. So far as first question i.e. the Tribunal had wrongly applied multiplier is concerned, it comes out from perusal of the impugned award that the Tribunal has applied '15' as the multiplier. Learned counsel for the appellant contended that the age of the deceased being 42 on the date of the accident, thus, in view of Sarla Verma (supra) case, Schedule II of the Motor Vehicles Act was not applicable to the application under Section 166 of the Act, therefore, multiplier is required to be reduced from '15' to '14'. In Sarla Verma (supra), Hon'ble Supreme Court provided the principles relating to assessment of loss of dependency and determination of compensation in a claim made under Section 166 of the Act. It was observed by Supreme Court in Sarla Verma (supra) 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. In Sarla Verma (supra), at paragraph 9, a two-Judge Bench dealt with this aspect in Step 2. To quote:

"Step 2 (Ascertaining the multiplier)

Having regard to the age of the deceased and period of active career, the appropriate multiplier should be selected. This does not mean ascertaining the number of years he would have lived or worked but for the accident. Having regard to several imponderables in life and economic factors, a table of multipliers with reference to the age has been identified by this Court. The multiplier should be chosen from the said table with reference to the age of the deceased."

10. The Table was provided in para 19, which is reproduced below:

"19. In New India Assurance Co. Ltd. v. Charlie : AIR 2005 SC 2157, this Court noticed that in respect of claims under Section 166 of the MV Act, the highest multiplier applicable was 18 and that the said multiplier should be applied to the age group of 21 to 25 years (commencement of normal productive years) and the lowest multiplier would be in respect of persons in the age group of 60 to 70 years (normal retiring age). This was reiterated in TN State Road Transport Corporation Ltd. v. Rajapriya: AIR 2005 SC 2985 and UP State Road Transport Corporation v. Krishna Bala : AIR 2006 SC 2688. The multipliers indicated in Susamma Thomas, Trilok Chandra and Charlie (for claims under Section 166 of MV Act) is given below in juxtaposition with the multiplier mentioned in the Second Schedule for claims under Section 163A of MV Act (with appropriate deceleration after 50 years):

Age of the deceased

Multiplier scale as envisaged in Susamma Thomas

Multiplier scale as adopted by Trilok Chandra

Multiplier scale in Trilok Chandra as clarified in Charlie

Multiplier specified in second column in the Table in II Schedule to MV Act

Multiplier actually used in Second Schedule to MV Act (as seen from the quantum of compensation)

Upto 15 yrs.

-

-

15 to 20 yrs.

21 to 25 yrs.

26 to 30 yrs.

31 to 35 yrs.

36 to 40 yrs.

41 to 45 yrs.

46 to 50 yrs.

51 to 55 yrs.

56 to 60 yrs.

61 to 65 yrs.

Above 65 yrs.

11. It may be noted that in Reshma Kumari & Ors. v. Madan Mohan & Anr.: (2013) 9 SCC 65; the three Judge Bench was dealing with a reference made by a two Judge Bench (S.B. Sinha and Cyriac Joseph, J.J.). The two Hon'ble Judges wanted an authoritative pronouncement from a Larger Bench on the question of applicability of the multiplier and whether the inflation was built in the multiplier. The three Judge Bench approved the two Judge Bench decision of the Supreme Court in Sarla Verma (supra) with regard to the selection of multiplier. The two referred questions by Reshma Kumari (supra) were :-

"1.1. Whether the multiplier specified in the Second Schedule appended to the Motor Vehicles Act, 1988 (for short "the 1988 Act") should be scrupulously applied in all cases" and

1.2. Whether for determination of the multiplicand, the 1988 Act provides for any criterion, particularly as regards determination of future prospects?"

12. While answering the points, in Para 43, the Supreme Court confirmed the principles and observed as under:-

40. In what we have discussed above, we sum up our conclusions as follows:

(i) In the applications for compensation made under Section 166 of the 1988 Act in death cases where the age of the deceased is 15 years and above, the Claims Tribunals shall select the multiplier as indicated in Column (4) of the table prepared in Sarla Verma : 2009 (6) SCC 121 read with para 42 of that judgment.

(ii) In cases where the age of the deceased is upto 15 years, irrespective of the Section 166 or Section 163A under which the claim for compensation has been made, multiplier of 15 and the assessment as indicated in the Second Schedule subject to correction as pointed out in Column (6) of the table in Sarla Verma : 2009 (6) SCC 121 should be followed.

(iii) As a result of the above, while considering the claim applications made under Section 166 in death cases where the age of the deceased is above 15 years, there is no necessity for the Claims Tribunals to seek guidance or for placing reliance on the Second Schedule in the 1988 Act.

(iv) The Claims Tribunals shall follow the steps and guidelines stated in para 19 of Sarla Verma :2009 (6) SCC 121 for determination of compensation in cases of death.

(v) While making addition to income for future prospects, the Tribunals shall follow paragraph 24 of the judgment in Sarla Verma : 2009 (6) SCC 121.

(vi) Insofar as deduction for personal and living expenses is concerned, it is directed that the Tribunals shall ordinarily follow the standards prescribed in paragraphs 30, 31 and 32 of the judgment in Sarla Verma :2009 (6) SCC 121 subject to the observations made by us in para 38 above."

13. The legal proposition propounded above also makes it clear that in the instant case, the multiplier of '14' in the case of the deceased whose age is between 41 to 45 years, is just and proper. Therefore, the Tribunal erred in applying the multiplier of '15'.

14. Now coming to the second question i.e. the Tribunal had erred in making 1/4th deduction towards personal expenses of the deceased in place of 1/3rd. In Sarla Verma (supra), it was held that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-fourth (1/4th) where the number of dependent family members is 4 to 6. To quote:

"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 Chandra, 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 dependent family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceed six"

15. We find it extremely difficult to fathom any rationale for the contention made by learned counsel for the appellant that the deduction towards personal expenses should have been 1/3rd in place of 1/4th. The deceased was survived by his wife, two minor children and parents. Even after excluding father, there were four dependents of the deceased and, thus, deduction of 1/4th was rightly made by the tribunal towards personal expenses of the deceased. But it is to be noticed that father cannot be deprived for loss on ground of love and affection. The wife was only teacher in a primary school, thus, considering the standard of the family of the deceased, the Tribunal has rightly considered her as dependent. Accordingly, we quantify the amount towards love and affection of the father as Rs.50,000/-.

16. It would be apt to mention that the mother of the deceased has died during the pendency of the appeal. In the era of globalization and multi national culture, there is tough competition. The just compensation is required by the family for its survival and to bring the potential of the children to the maximum.

17. In Rajesh and Ors. v. Rajbir Singh and Ors. : (2013) 9 SCC 54, the Hon'ble Supreme Court while reiterating the meaning of "just compensation" with reference to settled principles observed that at the time of fixing such compensation, the court should not succumb to the niceties or technicalities to grant just compensation in favour of the claimant. It is the duty of the court to equate, as far as possible, the misery on account of the accident with the compensation so that the injured or the dependents should not face the vagaries of life on account of discontinuance of the income earned by the victim, and the court's duty is to award just, equitable, fair and reasonable compensation, irrespective of claim made.

18. In the present case, the Tribunal has recorded specific findings of the facts on the basis of cogent materials on coming to the conclusion that the deduction of 1/4th towards personal expenses of the deceased was just and proper. Therefore, we do not find any illegality and infirmity in the impugned award with regard to the findings recorded by the Tribunal towards deduction of personal expenses of the deceased.

19. In these circumstances, the calculation of compensation will be as follows:-

1. Total income: Rs. 33,449 x 12 = Rs. 4,01,388.00 per annum.

2. Tax Deduction : Rs.4,01,388-Rs.1,60,000  = Rs. 2,41,388.00 		         10% of Rs.2,41,388 	 = Rs.24,139.00
 
                            Rs. 4,01,388-Rs. 24,139  =Rs. 3,77,249.00
 

 
3.  Addition of 30% for future prospects
 
    under Rule 220 Ka (3) of the Act :	
 
		
 
			30% of Rs.3,77,249         =Rs. 1,13, 175.00
 
			Rs.3,77,249-Rs.1,13,175  =Rs.4,90,424/-
 

 
4. Net income    : Rs.4,90,424/-
 
 5. 1/4th Personal Deductions:Rs.4,90,424-Rs.1,22,606=Rs. 3,67,818/-
 
6. Multiplier '14'	: Rs. 3,67,818 x '14'    =  Rs.51,49,452/-
 
Conventional Heads:
 
7. Funeral Expenses    	    :	     Rs. 5000/-
 
     8. Loss of Estate	    	   	:	Rs. 10,000/-
 

 
     9. Loss of Love & Affection of family members except father:Rs.5000/-
 

 
     10.  Loss of love & affection of father :  Rs.50,000/-
 

 
     11. Additional compensation
 
           or loss of estate		:	Rs.5000/-
 
Total amount : Rs. 51,49,452 + Rs.75,000/-= Rs.52,24,452.00
 

 

20. For the reasons aforesaid, the impugned award is modified to the extent that appellant-Insurance company is directed to pay Rs.52,24,452/- as compensation along with interest @ 7% per annum from the date of filing of claim petition to the claimants within a month from today. The aforesaid amount of compensation shall be disbursed amongst the claimants/legal heirs of the deceased equally except father who will get Rs.50,000/- only for loss of love and affection.

21. Statutory amount, if any, deposited shall be transmitted to the Tribunal forthwith.

22. The First Appeal From Order is partly allowed in above terms. No separate order as to costs.

Order Date: 10.6.2016

K.R.