Smt. Asha Gupta, W/O Late Sh. Shyam ... vs Mr. Ramji Lal, S/O Sh. Banna Lal ...
2003 Latest Caselaw 46 Del

JUDGMENT

S.N. Kapoor, J.

1. Heard.

2. In an unfortunate accident which took place on 21st October, 1995 Sh. Shyam Sunder Gupta (deceased) while traveling by his car no. DL-3CD-2021 from Karnal towards Delhi via G. T. Karnal Road along with two other persons, had reached near Babbarpur District Panipat, Haryana, then his car was hit by truck bearing No. RJ-14G-2841 coming from the opposite side. All the occupants of the said car sustained injuries. Sh. Shyam Sunder Gupta died on his way to the hospital and was declared brought dead at the General Hospital. The claimants in this case, the widow-Smt. Asha Gupta, and the two sons Master Rahul Gupta and Master Rohit Gupta filed the claim petition. The learned Motor Accident Claims Tribunal (in short the 'Tribunal') took the income of the deceased at the basic minimum wages for a semi-skilled worker at Rs. 1711/- per month and calculated the compensation. The age of the deceased was accepted as 35 years. One-third was deducted out of the average monthly income towards his personal expenses. 14 years multiplier was applied and a sum of Rs. 1,91,688/- was awarded towards compensation, Rs. 2000/- towards funeral expenses and Rs. 5000/- towards loss of consortium with interest @ of 9% p.a. On the awarded amount from the filing of the petition till realisation.

3. The claimants feeling aggrieved have filed this appeal. The learned Counsel for the appellant submits that the learned Tribunal failed to consider the virtually unchallenged evidence on record indicating that he was maintaining two cars, paying Rs. 1400/- as rent for a shop, Rs. 300/- towards school fee of each of the two children. In these circumstances, the learned Tribunal should not have rejected the evidence on record. The learned Tribunal also did not apply appropriate multiplier in view of the fact that the age of the deceased was 35 years and according to the Schedule appended to the Motor Vehicles Act, 17 years multiplier should have been applied. The next contention of the learned counsel for the appellant is that only 9% interest has been awarded.

4. This Court could not have the benefit of hearing the arguments of the respondents on account of absence of the respondents.

5. It is notable that Smt. Asha Gupta, P.W.3, widow, stated that her husband was earning more than Rs. 6000/- per month and he used to give her Rs. 4000/- towards household expenses and Rs. 1400/- as house rent, in addition to Rs. 600/- towards the fees of the two children. She filed receipts Ex. P.W.2/1 and Ex.P.W. 2/4. She also stated that her husband had taken a shop on rent at the rate of Rs. 200/- per month and she proved the receipt Ex.P.W.2/5 and Ex. P.W.2/6. She further stated that they were maintaining two cars and one was registered in her name and another in the name of her deceased husband. The Registration number of her car was DL-3CD-2021 and the registration number of the care of her husband was 4554. The cars were registered with Transport Authority, Delhi.

6. From her statement it is apparent that the claimant (widow) as well as the deceased were residing at Delhi. She also stated that the business of the deceased had to be closed for there was none to look after the same. However, she admitted in cross-examination that there was no proof of payment of income tax in her knowledge. She denied the suggestion that her husband didn't used to give her Rs. 4000/- per month for household expenses.

7. The fact that the deceased was owning a car and maintaining the same is proved by the fact that at the time of the accident the deceased was traveling in the car bearing no. DL 3CD 2021 registered in the name of Smt. Asha Gupta. Thus, this testimony of the claimant (widow) could not be rejected out of hand. In the aforementioned circumstances, supposing the income of the deceased was Rs. 55,000/- per year then the income would not be taxable and in that light the fact that the income tax return had not been produced would not indicate that the deceased was not giving Rs. 4000/- per month to the claimant/widow. This income of over Rs. 5000/- has been further established that he was paying Rs. 1400/- as rent. A person who was paying Rs. 1400/- per month as rent, as proved by P.W.3 Mr. Vinod Kumar Sharma, the then landlord of the deceased Shyam Sunder Gupta would further confirm it. Accordingly, his annual income would not be less than Rs. 55,000/- per year. In such circumstances to apply the standard minimum wages would not be justified.

8. Taking the income of the deceased at Rs. 55,000/- per year, the compensation has to be calculated taking into consideration the guidelines laid down in General Manager, Kerala State Road Transport Corporation vs. Susamma Thomas, 1994 ACJ 1 and Sarla Dixit and another vs. Balwant Yadav and others 1996 ACJ 581 . The relevant paragraph 13 of the judgments in Susamma Thomas's case (supra) reads as under:-

"13. ....................The deceased person in this case had a more or less stable job. It will not be inappropriate to take a reasonably liberal view of the prospects of the future and in estimating the gross income it will be unreasonable to estimate the loss of dependency on the present actual income of Rs. 1,032/- per month. We think, having regard to the prospects of advancement in the future career, respecting which there is evidence on record, we will not be in error in making a higher estimate of monthly income of Rs. 2,000/- as the gross income. From this has to be deducted his personal living expenses, the quantum of which again depends on various factors such as whether the style of living was Spartan or Bohemian. In the absence of evidence it is not unusual to deduct one-third of the gross income towards the personal living expenses and treat the balance as the amount likely to have been spent on the members of the family and the dependants. This loss of dependency should capitalize with the appropriate multiplier. In the present case we can take about Rs. 1,400/- per month or Rs. 17,000/- per year as the loss of dependency and if capitalized on a multiplier of 12, which is appropriate to the age of the deceased, the compensation would work out to (Rs. 17,000/- x 12 = Rs. 2,04,000/-) to which is added the usual award for loss of consortium and loss of the estate each in the conventional sum of Rs. 15,000/."

Similar view was taken in para 6 of the judgment in Sarla Dixit's case (supra), which reads as under:-

"....................Deceased in the present case, as seen above, was earning gross salary of Rs. 1,543/- per month. Rounding it up to figure of Rs. 1,500/- and keeping in view all the future prospects which the deceased had in stable military service in the light of his brilliant academic record and performance in the military service spread over 7 years, and also keeping in view the other imponderables like accidental death while discharging military duties and the hazards of military service, it will not be unreasonable to predicate that his gross monthly income would have shot up to at least double than what he was earning at the time of his death, i.e., up to Rs. 3,000/- per month had he survived in life and had successfully completed his future military career till the time of superannuation. The average gross future monthly income could be arrived at by adding the actual gross income at the time of death, namely, Rs. 1,500/- per month to the maximum which he would have otherwise got had he not died a premature death, i.e. Rs. 3,000/- per month and dividing that figure by two. Thus, the average gross monthly income spread over his entire future career, had it been available, would work out to Rs. 4,500/- divided by 2, i.e. Rs. 2,200/-. Rs. 2,200/- per month would have been the gross monthly average income available to the family of the deceased had he survived as a bread-winner. From that gross monthly income at least 1/3rd will have to be deducted by way of his personal expenses and other liabilities like the payment of income tax etc. That would roughly work out to Rs. 730/- p.m. and deducting the same by way of average personal expenses of the deceased from the average gross earning of Rs. 2,200/- p.m. balance of Rs. 1,450/- which can be rounded off to Rs. 1,500/- p.m. would have been the average amount available to the family of the deceased, i.e., his dependants, namely, appellants herein. It is this figure which would be the datum figure per month which on annual basis would work out to Rs. 18,000/-. Rs. 18,000/- therefore, would be the proper multiplicand which would be available for capitalisation for computing the future economic loss suffered by the appellants on account of untimely death of the bread-winner. As the age of the deceased was 27 years and a few months at the time of his death the proper multiplier in the light of the aforesaid decision of this court in General Manager, Kerala State Road Transport Corpn. v. Susamma Thomas, 1994 ACJ 1 (SC), would be 15. Rs. 18,000/- multiplied by 15 will work out to Rs. 2,70,000/-. To this figure will have to be added the conventional figure of Rs. 15,000/- by way of loss of estate and consortium, etc. That will lead to a total figure of Rs. 2,85,000/-. This is the amount which the appellants would be entitled to get by way of compensation from the respondent Nos. 1 and 2 subject to our decision on point No.2."

9. In both the above cited cases, the future prospects have been considered by nearly doubling the income of the deceased. Thus, the average yearly income of the deceased in the present case could be taken to Rs. 1,10,000/- per year for the purpose of computing compensation. Out of this amount 1/3rd thereof is required to be deducted towards personal expenditure of the deceased on himself, in view of the above judgments of the Supreme Court, leaving a balance of Rs. 73,333/- as average yearly dependency of the claimants.

10. In view of the Schedule, which can be used as a good guideline, in absence of any circumstance which would not appeal to the common sense and due deference to the legislative intent expressed through the Schedule, 16 years multiplier is required to be applied in case the deceased is between 35 years and 40 years of age. Here, in this case, none of the parents of the deceased are claimants for they have pre-deceased the deceased. The claimants are obviously younger in age and as such 16 years multiplier appears to be just. Accordingly, the claimants are entitled to compensation amounting to Rs. 11,73,328/-.

11. As regards the funeral expenses and loss of consortium, an additional sum of Rs. 7000/- is granted in terms of the award given by the Tribunal for, it is justified. Thus, in all Rs. 11,80,328/- appear to be the just compensation.

12. As regards the interest, generally the Tribunals and the High Courts award interest @ 12% p.a. and in some cases awarded interest even at higher rate. Awarding interest of 9% when the bank rate was also high does not appear to be reasonable. Accordingly, the claimants would be entitled to interest @ 12% p.a. from the date of petition till 31st March, 2001. However, the claimants shall be entitled to claim interest only @ 9% p. a. from 1st April, 2001, in view of the reduction in the rate of interest on fixed deposits in the nationalised banks.

13. As regards the apportionment, 60% of the total amount would be payable to the claimant-widow and 20% each to the two sons. Out of the amount falling in the share of the widow 70% of the total amount of award will be deposited in a fixed deposit for a period of 5 years and 30% will be paid to the claimant-widow. Similarly, out of the total amount falling in the share two sons, 70% of the amount shall be deposited in fixed deposit for a period of 5 years and the remaining 30% may be paid to the claimant-widow, in case none of the sons have attained majority. Claimants shall adjust the payment already recouped accordingly. However, the claimant widow (along with the major son) would be entitled to get quarterly interest on the amount so deposited in the fixed deposit.

14. Appeal is accepted accordingly. The respondents who are jointly and severally liable to pay this amount are directed to pay and deposit the amount within a period of four weeks.

"15. We thought it necessary to reiterate the method of working out 'just' compensation because, of late, we have noticed from the awards made by Tribunals and court that the principle on which the multiplier method was developed has been lost sight of and once again a hybrid method based on the subjectivity of the Tribunal/court has surfaced, introducing uncertainty and lack of reasonable uniformity in the matter of determination of compensation.

                       It   must   be     realised   that   the
                       Tribunal/court  has to determine a  fair
                       amount  of compensation awardable to the
                       victim  of  an  accident which  must  be
                       proportionate to the injury caused.  The
                       two  English decisions to which we  have
                       referred  earlier provide the guidelines
                       for assessing the loss occasioned to the
                       victims.  Under the formula advocated by
                       Lord  Wright  in Davies, (1942) AC  601,@@
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                       the  loss has to be ascertained by first
                       determining  the  monthly income of  the
                       deceased,  then deducting there from  the
                       amount  spent on the deceased, and  thus
                       assessing  the loss to the dependents of
                       the  deceased.   The  annual  dependency
                       assessed  in  this manner is then to  be
                       multiplied  by the use of an appropriate
                       multiplier.   Let  us   illustrate:   X,
                       male,  aged  about 35 years, dies in  an
                       accident.   He  leaves behind his  widow
                       and  3  minor   children.   His  monthly
                       income  was  Rs.  3,500/-.  First,  deduct
                       the  amount spent on X every month.  The
                       rough  and ready method hitherto adopted
                       where   no    definite    evidence   was
                       forthcoming  was to break up the  family
                       into units, taking two units for a adult
                       and  one  unit for a minor.  Thus X  and
                       his  wife make 2 + 2 = 4 units and  each
                       minor  one  unit, i.e., 3 units in  all,
                       totaling  7 units.  Thus the share  per
                       unit  works out to Rs.  3,500/7 = Rs.  500/-
                       per  month.  It can thus be assumed that
                       Rs.  1,000/- was spent on X.  Since he was
                       a  working member some provision for his
                       transport  and out-of-pocket expense  has
                       to be estimated.  In the present case we
                       estimate  the  out-of-pocket expense  at
                       Rs.  250/-.   Thus the amount spent on the
                       deceased  X works out to Rs.  1,250/-  per
                       month  leaving a balance of Rs.  3,500/- -
                       1,250/-  =  Rs.  2,250/- per month.   This
                       amount  can be taken as the monthly loss
                       to   X's    dependents.     The   annual
                       dependency  comes  to Rs.  2,250/- x 12  =
                       Rs.  27,000/-.  This annual dependency has
                       to  be  multiplied  by  the  use  of  an
                       appropriate  multiplier  to  assess  the
                       compensation  under the head of loss  to
                       the  dependents.   Take the  appropriate
                       multiplier  to be 15.  The  compensation
                       comes    to   Rs.  27,000/-    x   15    =
                       Rs.  4,05,000/-.   To this may be added  a
                       conventional  amount  by way of loss  of
                       expectation  of  life.    Earlier   this
                       conventional  amount was pegged down  to
                       Rs.  3,000/-  but now having regard to the
                       fall  in the value of the rupee, it  can
                       be  raised to a figure of not more  than
                       Rs.  10,000/-.   Thus  the total comes  to
                       Rs.  4,05,000/- + 10,000/- = Rs.  4,15,000."