Delhi High Court

Icici Lombard General Insurance ... vs Smt. Mala Devi & Ors. on 8 August, 2008

Author: V.B.Gupta

*      HIGH COURT OF DELHI : NEW DELHI

                 MAC App. No.409 of 2008

%                     Judgment reserved on: 28th July, 2008

                      Judgment delivered on: 8th August, 2008


ICICI Lombard General Insurance Co.Ltd.
5th Floor, Birla Tower,
25, Barakhambha Road,
Connaught Place,
New Delhi.                           ....Appellant

                          Through: Mr.Pankaj Seth, Adv.

                               Versus

1)    Smt.Mala Devi, W/o Sh.OM Prakash Mehra

2)    Sh. Om Prakash Mehra, S/o Sh.Ram Chander,

Respondents No.1 and 2,
R/o 2936, Kahar Mohalla,
Nasirabad, Distt. Ajmer (Raj.)

Also at:
H.No.9310, Bhagat Singh Gali,
Library Road, Delhi.

3)    Sh.Pradeep Kumar, S/o Sh.Mohinder Singh,
      R/o House No.342, Rithala Road, Village Post
      Shahabad Daulatpur, Delhi-42.

4)    Sh. Naresh, S/o Sh.Raj Singh,
      R/o 135, Shahbad Daulatpur,
      Delhi-42.                     ...Respondents.
                          Through: Nemo.



MAC App.No.409/2008                                 Page 1 of 16
 Coram:
HON'BLE MR. JUSTICE V.B. GUPTA

1. Whether the Reporters of local papers may
   be allowed to see the judgment?                  Yes

2. To be referred to Reporter or not?               Yes

3. Whether the judgment should be reported
   in the Digest?                                   Yes


V.B.Gupta, J.

The present appeal under section 173 of the

Motor Vehicles Act, 1988 (for short as the "Act") has

been filed by the Appellant/Insurance Company against

the award dated 25.03.08 passed by Ms. Neena Bansal

Krishna, Judge, Motor Accident Claims Tribunal (for

short as the "Tribunal"), Delhi.

2. Brief facts of the case are that on 30.06.07 at

about 11.15 p.m., the deceased Chintoo along with his

brother Vicky and father were going towards Teliwara

Subzi Mandi Chowk Mor, Azad Market when a delivery

Van (Vikram) bearing no. DL-1-LH-5397 came for the

side of Teliwara, at high speed and took sharp U turn

because of which the vehicle could not be controlled. It

over turned and fell over the deceased Chintoo and his

brother Vicky. The deceased Chintoo expired in this

accident.

3. The claim petition filed by the parents of the

deceased Chintoo aginst the Respondent no.3 herein,

driver, Respondent no.4 herein, owner of the offending

vehicle and Appellant herein, as the offending vehicle

is insured with them.

4. Vide impugned judgment, the Tribunal awarded

compensation of Rs.2,80,000/- along with the interest

@ 7.5% from the date of institution of the petition till

the date of its payment payable by all the Respondents

to the claimants.

5. It has been contended by the Ld. Counsel for

Appellant that the tribunal has erred in considering the

future increase in the earning of the deceased despite

the fact that the deceased at the time of accident was

aged 12 years and was a student and was not working

and earning. The Tribunal has also erred in law in

presuming that the Second Schedule of the Act had

become effective in the year 1994 and considering that

there has been about 300% increase in the price index

since 1994 to 2006 and considering the inflationary

trends and rise in price index, it would not be

unreasonable to assume that the notional income of

the deceased would now be Rs.30,000/- p.a. whereas in

the Second Schedule, the notional income has been

shown as Rs.15,000/- p.a.

6. Ld. Counsel for the Appellant has relied upon the

decision of the Apex Court in Kaushlya Devi v. Shri

Karan Arora & Ors., 2007 (7) SCALE 517 in

support of its contentions.

7. The claimant Sh. Om Prakash deposed that the

deceased Chintoo was 12 years old at the time of

accident, and is survived by his father and mother and

was not working. In the postmortem report, the age of

Chintoo is shown as 12 years. Thus, the age of the

deceased has been taken to be 12 years.

8. Thus, the Tribunal held;

"The petitioner has deposed that his child was 12 years old at the time of his death and was not employed. In such circumstances, the notional income of the deceased may be held as Rs.15,000/- per annum as has been provided in the II Schedule. The II Schedule had become effective in the year 1994. Considering that there has been about 300% increase in the price index since 1994-2006 and considering the inflationary trends and rise in price index, it would not be unreasonable to assume that the notional income of the deceased would now be Rs.30,000/- per annum." The Tribunal further held; "The deceased was an unmarried boy of 12 years. It can be reasonably expected that he would have got married at the age of about 23-24 years and thereafter, his contribution towards family would have reduced. In such circumstances, it can be expected that the deceased, on an average, would have spent 50% of his income on himself and would have contributed 50% towards parents,

i.e., Rs. 15,000 per annum. The loss of dependency can thus be taken as Rs. 15,000/- per annum."

9. Thus, by applying the multiplier of 16 and after

making one half deductions, the Tribunal awarded Rs.

2,40,000/-(Rs.15,000/-x16) towards the loss of

dependency to the claimants.

10. No amount of compensation can compensate the

loss of a life or can bring back happiness in the lives of

the dependant family members. However, it is clear

from the various decisions of the Courts that

compensation of varying amounts in regard to

unfortunate death of young children had been awarded

depending upon the facts and circumstances of each

case. As regard the quantum of compensation, no

decision as such can be taken to be of binding

precedents. Each case has to be dealt with on its own

peculiar facts, depending upon the financial & social

status of the family in society, environment in which

the deceased was brought up, his academic career and

health of the deceased child and other relevant facts.

11. Under the provisions of the Act, there is no

restriction that compensation could be awarded only

up to the amount claimed by the claimant. But the only

embargo is that it should be „just‟ compensation, that

is to say, it should be neither arbitrary, fanciful nor

unjustifiable from the evidence.

12. In cases of motor accidents, the endeavour is to

put the dependents/claimants in the pre-accidental

position. Compensation in cases of motor accidents, as

in other matters, is paid for reparation of damages.

The damages so awarded should be adequate sum of

money that would put the party, who has suffered, in

the same position if he had not suffered on account of

the wrong. Compensation is, therefore, required to be

paid for prospective pecuniary loss, i.e. future loss of

income/dependency suffered on account of the

wrongful act.

13. The difficulty arises in the cases of death of child

is where they are not earning at the time of the

accident. In most of the cases they were still studying

and not working. Yet it cannot be said that the

dependants have not suffered any pecuniary loss. Loss

of dependency by its very nature is awarded for

prospective or future loss.

14. In Kaushlya Devi (supra), the Apex Court has

observed as under;

"There are some aspects of human life which are capable of monetary measurement, but the totality of human life is like the beauty of sunrise or the splendor of the stars, beyond the reach of monetary tape-measure. The determination of damages for loss of human life is an extremely difficult task and it becomes all the more baffling when the deceased is a child and/or a non-earning person. The future of a child is uncertain. Where the deceased was a child, he was earning nothing but had a prospect to earn. The question of assessment of compensation, therefore, becomes stiffer. The figure of compensation in such cases

involves a good deal of guesswork. In cases, where parents are claimants, relevant factor would be age of parents."

The Court further observed as under;

"In the case of death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child's lifetime. But this will not necessarily bar the parent's claim and prospective loss will find a valid claim provided that the parents establish that they had a reasonable expectation of pecuniary benefit if the child had lived. This principle was laid down by the House of Lords in the famous case of Taff Vale Rly. v. Jenkins (1913) AC 1, and Lord Atkinson said thus:

"...all that is necessary is that a reasonable expecta- tion of pecuniary benefit should be entertained by the person who sues. It is quite true that the existence of this expectation is an inference of fact - there must be a basis of fact from which the inference can reasonably be drawn; but I wish to express my emphatic

dissent from the proposition that it is necessary that two of the facts without which the inference cannot be drawn are, first that the deceased earned money in the past, and, second, that he or she contributed to the support of the plaintiff.

These are, no doubt, pregnant pieces of evidence, but they are only pieces of evidence; and the necessary inference can I think, be drawn from circumstances other than and different from them." (See Lata Wadhwa and Ors. v. State of Bihar and Ors. (2001 (8) SCC 197))."

15. This view was reiterated by the Apex Court in

New India Assurance Co. Ltd. v. Satender and

others, 2007 ACJ 160.

16. In this case, the Apex Court granted the

compensation of Rs.1,80,000/- on death of a child aged

9 years. The Apex Court has observed as under;

"In Mallett v. McMonagle, 1969 ACJ 312 (HL, England), Lord

Diplock analysed in detail the uncertainties which arise at various stages in making a rational estimate and practical ways of dealing with them. In Davies v. Taylor 1973 ACJ 66 (CA, England), it was held that the Court, in looking at future uncertain events, does not decide whether on balance one thing is more likely to happen than another, but merely puts a value on the chances. A possibility may be ignored if it is slight and remote. Any method of calculation is subordinate to the necessity for compensating the real loss. But a practical approach to the calculation of the damages has been stated by Lord Wright in Davies v. Powell Duffryn Associated collieries Ltd. (1942) 1 All ER 657, in the following words:

"The starting point is the amount of wages which the deceased was earning, the ascertainment of which to some extent may depend on the regularity of his employment. Then there is an estimate of how much was required to be spent for his own personal and living expenses. The balance will give a datum or basic figure which will generally be turned into a lump sum by

taking a certain number of years' purchase."

17. As regards the contention of the Appellant

Counsel that the Tribunal should have awarded the

compensation as laid down in the Second Schedule of

the Act, appears to be attractive but at the same time

does not appear to be justified.

18. The Second Schedule under section 163A of the

Act was brought on the Statute Book in the year 1994

and since then no revision in the said Schedule has

taken place. As per Section 168 of the Act it has to be

borne in mind by the Tribunal that "just compensation"

has to be made in the facts and circumstances of each

case.

19. In this regard, the Apex Court also observed in

The Divisional Controller, KSRTC v. Mahadeva

Shetty & Anr., JT 2003 (6) SC 519, as under;

"It has to be kept in view that the Tribunal constituted under the Act as provided in Section 168 is

required to make an award determining the amount of compensation which to it appears to be "just". It has to be borne in mind that compensation for loss of limbs or life can hardly be weighed in golden scales. Bodily injury is nothing but a deprivation which entitles the claimant to damages. The quantum of damages fixed should be in accordance with the injury. An injury may bring about many consequences like loss of earning capacity, loss of mental pleasure and many such consequential losses. A person becomes entitled to damages for mental and physical loss, his or her life may have been shortened or that he or she cannot enjoy life, which has been curtailed because of physical handicap. The normal expectation of life is impaired. But at the same time it has to be borne in mind that the compensation is not expected to be a windfall for the victim. Statutory provisions clearly indicate that the compensation must be "just" and it cannot be a bonanza; not a source of profit but the same should not be a pittance. The courts and tribunals have a duty to weigh the various factors and quantify the amount of compensation, which should be just. What would be "just" compensation is a vexed question. There can be no golden rule applicable to all cases for

measuring the value of human life or a limb. Measure of damages cannot be arrived at by precise mathematical calculations. It would depend upon the particular facts and circumstances, and attending peculiar or special features, if any. Every method or mode adopted for assessing compensation has to be considered in the background of "just" compensation which is the pivotal consideration. Though by use of the expression "which appears to it to be just", a wide discretion is vested in the Tribunal, the determination has to be rational, to be done by a judicious approach and not the outcome of whims, wild guesses and arbitrariness. The expression "just" denotes equitability, fairness and reasonableness, and non-arbitrary. If it is not so, it cannot be just.

(See Helen C. Rebello v.

Maharashtra State Road Transport Corporation & another, II (1998) ACC 512.)"

20. Ld. Counsel for the Appellant has relied upon

para 11 of the Apex Court decision in Kaushlya Devi

(supra) in support of its contentions.

21. In this case, the Apex Court granted the

compensation of Rs.1,00,000/- on death of a child aged

14 years. The Apex Court has observed as under;

"In cases of young children of tender age, in view of uncertainties abound, neither their income at the time of death nor the prospects of the future increase in their income nor chances of advancement of their career are capable of proper determination on estimated basis. The reason is that at such an early age, the uncertainties in regard to their academic pursuits, achievements in career and thereafter advancement in life are so many that nothing can be assumed with reasonable certainty. Therefore, neither the income of the deceased child is capable of assessment on estimated basis nor the financial loss suffered by the parents is capable of mathematical computation."

22. In the present case, the notional income of the

deceased has been taken as per Second Schedule of

the Act and then considered the increase on the said

income. But at the same time, the Tribunal has off set

the increase in notional income, by deducting one half

deductions on account of personal expenses, instead of

1/3rd from the income of the deceased, which is the

usual formula.

23. So, in view of the above discussion, I do not find

any infirmity or illegality in the impugned judgment

passed by the Tribunal.

24. The compensation awarded by the learned