Smt.Hansi Devi & Ors. vs Sh.Sarbhjeet Singh & Ors.
2008 Latest Caselaw 1804 Del

*      HIGH COURT OF DELHI : NEW DELHI

                  MAC App. No.492/2004

%           Judgment reserved on: 23rd September, 2008

            Judgment delivered on:3rd October, 2008

1. Smt. Hansi Devi
   W/o. Lt. Sh. Devinder Singh

2. Baby Radha Devi
   D/o. Late Sh. Devinder Singh

3. Master Jagdish
   S/o. Late Sh. Devinder Singh

4. Master Rahul
   S/o. Late Sh. Devinder Singh

5. Smt. Basanti Devi
   W/o. Late Shri Ishwar singh
   (Mother of Deceased Devinder Singh)

(Appellants No.2 to 4 are minor daughter and sons of
late Sh. Devinder Singh and are represented through
the appellant No.1 being the mother and the legal and
lawful natural guardian of the said minor appellants).

(All residents of Village Dhania Kott (Tala Kot) Post
Office Dhania Kott, Distt. Nainital (Uttranchal) and
Also at:
K-4/3D, West Ghonda, Gali No.8,
Delhi-110053                              ....Appellants

                  Through: Rajeev Saxena, Adv.

                           Versus




MAC No.492/2004                                  Page 1 of 20
 1. Shri. Sarbhjeet Singh
  S/o. Mukhtiar Singh
  R/o. Vill. Takhtu Pura,
  Police Station Nihal singh Wala
  Distt. Mogha, Punjab.

2. Shri Jagroop Singh
   S/o. Shri Bachan Singh
   R/o. 315/3, Ram Nagar,
   Ambala City,
   Haryana.

3. National Insurance Company Ltd.
   2E/9, Jhandewalan Extn., Karol Bagh,
   New Delhi-110005                ...Respondents.

                    Through: Mr. A.K. Soni, Adv. for
                             R-3

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.

Present appeal has been filed by the appellants,

who are claimants in this case under Section 173 of the

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

seeking enhancement of the compensation awarded in

this case vide judgment dated 11th August, 2004,

passed by Sh. M.L. Mehta, Judge, MACT (for short as

„Tribunal‟), Delhi.

2. Brief facts of this case are that on 10th May, 2001,

at about 9.10 p.m., at main Wazirabad Road, near Sur

Ghat police booth, deceased Devinder Singh along with

his friend Goverdhan Singh was going as a pillion rider

on the bicycle. When they reached near police booth

on main Wazirabad Road towards Yamuna Bridge and

were on the left side of the road, a truck bearing

No.HR-37-3268 being driven by respondent No.1,

Sarabhjeet Singh in a very rash and negligent manner

and at a high speed, came from behind and struck

their bicycle. The deceased was crushed by the truck

and was taken to trauma centre, where he expired.

3. The said truck was driven by respondent No.1

with the permission, consent and under the

employment and supervision of respondent

No.2/Jagroop Singh. The truck was insured with

respondent No.3/National Insurance Company.

4. The appellants claimed compensation amounting

to Rs.20 lacs on account of loss of income, love,

affection and security etc.

5. Respondents No.1 and 2 filed joint written

statement pleading that deceased has died due to his

own negligence by coming in contact with the left side

of rear wheel of the trailor, which the respondent No.1

was driving. As a matter of fact, the deceased was

pillion rider at a cycle and due to a speed breaker, the

cyclist lost his balance and pillion rider fell on the right

side of the cycle and on the left side of the trailor and

because of losing the balance, the pillion rider came in

contact with the rear wheel of the trailor for which the

respondents cannot be held liable under any

circumstances and thus there was no negligence on

the part of respondent No.1.

6. Respondent No.3, the Insurance Company in its

written statement has admitted that the offending

vehicle was insured with it in the name of respondent

No.2. However, it is stated that driver of the alleged

offending vehicle was not holding a valid and effective

driving licence and as such the liability cannot be

fastened to this respondent.

7. Vide impugned judgment, the Tribunal awarded a

compensation of Rs.3,09,400/- with interest @ 6% for a

period of two years.

8. It has been contended by the counsel for the

appellants that the Tribunal has failed to assess the

correct income of the deceased at Rs.4,000/- per month

as stated and proved by the witness on the basis of

unrebutted testimony of the appellant no.1.

9. The Tribunal also failed to consider the amount of

compensation on the basis of the statutory multiplier of

18 prescribed for the age group of above 25 years but

not exceeding 30 years, in which case the multiplier of

18 ought to have been applied to the proven income of

the deceased at Rs.56,040/- per annum.

10. The other contention is that future prospects in

business were not taken into consideration.

11. Lastly, it is contended that the Tribunal by

allowing interest for a period of only, two years, that

too at a rate of 6% only, has acted against the

principles laid down by the Apex Court as well as by

this Court in number of cases.

12. On the other hand, it is contended by the counsel

for the respondent no.3- Insurance company that the

Tribunal has rightly taken the monthly income of

deceased at Rs.1,800/- per month as per statement of

PW3 and there is no infirmity in its order.

13. Further, it has rightly applied the multiplier of 14

in view of the decision of the Apex Court in Sarla Dixit

v. Balwant Yadav, AIR 1996 SC 1272.

14. In the present case, no documentary evidence

regarding age of the deceased has been filed on record

by the appellants. However, the age of the deceased at

the time of accident was stated to be 29 years.

15. On the other hand, in the post-mortem report

Ex.PW-4/6 and MLC Ex.PW4/7, age of deceased has

been mentioned as 30 years.

16. In the absence of any other evidence, the age of

the deceased was rightly taken to be as 30 years.

17. Regarding monthly income of the deceased, PW4

Hansi Devi, widow of the deceased, has stated that the

deceased was earning about Rs.4,000/- per month

whereas, PW3, Goverdhan Singh, has stated that

deceased used to tell him that he was earning about

Rs.50-60/- per day and that he also used to keep some

holidays in a month.

18. Both these witnesses have orally stated about the

income of the deceased, but no cogent evidence to

substantiate their statements with regard to earnings

of deceased, has been placed on record.

19. The Tribunal with regard to the income of the

deceased has held that;

"With regard to the profession and income of the deceased also there was no cogent evidence to substantiate the statement of the petitioner Hansi Devi or that of PW-3 Goverdhan Singh. They had orally stated that the deceased was selling stationery and earning Rs.4,000/- per month. PW-3 Goverdhan Singh in his cross- examination stated that the deceased told him that he was earning about Rs.50-60/- per day and that he also used to keep some holidays in a month. If that was so, according to this witness, the income of the deceased was Rs.1,500-1,800/- per month. Thus the income of the deceased can be taken to be Rs.1,800/- per month."

20. The Trial Court has relied upon the statement of

PW-3 and taken the income of the deceased as

Rs.1,800/- per month.

21. However, the best evidence with regard of income

of the deceased would be his wife i.e. PW4 Hansi devi.

She has categorically stated that her husband was

earning about Rs.4,000/- per month. She denied the

suggestion that her husband was earning only

Rs.1,500/- per month.

22. The Apex Court in plethora of cases has held that

while assessing the income of the deceased in motor

accident cases, the tribunals should bear in mind that

the same should be assessed on the basis of the cogent

and the reliable evidence produced and duly proved on

record.

23. In this regard the thumb rule is that where there

is no cogent evidence on record to prove the monthly

income at the time of accident, then the minimum

wages notified under the Minimum Wages Act

prevalent at the time of accident can be taken into

consideration.

24. Since, no documentary proof with regard to the

profession or qualification of the deceased has been

filed on record by the appellant, thus, the income of

the deceased is taken as that of an unskilled worker.

25. The minimum wages as on the relevant date of

accident i.e. 10.05.01 for an unskilled worker were Rs.

2579/- per month.

26. It is well settled proposition that while

determining the quantum of compensation, the future

prospects are also required to be taken into

consideration. Though the claimants have failed to

produce any cogent evidence on record, but once the

resort has been made to the Minimum Wages Act,

therefore, the increase in the future wages under the

Minimum Wages Act can certainly be taken into

consideration.

27. In General Manager, Kerala State Road

Transport Corporation, Trivandrum v. Mrs.

Susamma Thomas and others, AIR 1994 SC 1631,

the Apex Court has observed as under;

"Of course, the future prospects of advancement in life and career should also be sounded in terms of money to augment the multiplicand. While the chance of the multiplier is determined by two factors, namely, the rate of interest appropriate to a stable economy and the age of the deceased or of the claimant whichever is higher, the ascertainment of the multiplicand is a more difficult exercise. Indeed, many factors have to be put into the scales to evaluate the contingencies of the future. All contingencies of the future need not necessarily be baneful. 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. 1032/- 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 at Rs. 2000/- 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 dependents. This loss of dependency should capitalize with the appropriate multiplier."

28. In Smt. Sarla Dixit and Anr. v. Balwant Yadav

& Ors., (supra) where the Apex Court followed the

decision of Susamma Thomas (supra), has observed

as under;

"So far as the adoption of the proper multiplier is concerned, it was observed that the future prospects of advancement in life and career should also be sounded in terms of money to augment the multiplicand. While the chance of the multiplier is determined by two factors, namely, the rate of interest appropriate to a stable economy and the age of the deceased or of the claimant whichever is higher, the ascertainment of the multiplicand is a more difficult exercise. The average gross future monthly income could be arrived at by adding the actual gross income at the time of death to the maximum which he would have otherwise got had he not died a premature death and dividing that figure by two. Thus the average gross monthly income spread over his entire future career, had it been available, would have been the gross monthly average income available to the family

of the deceased had he survived as a bread winner."

29. Keeping in view the above said decisions and

rising price and inflationary trends, it can be assumed

that income of the deceased would have doubled by the

time he would have retired from working and thus, the

monthly income of the deceased can be taken to be at

Rs. 3868.50p. (Rs.2,579 + Rs. 5,158/- = Rs. 7,737/-

divided by 2) and after making 1/3rd deduction

towards the personal expenses, the financial

dependency of the claimant is assessed at Rs.2,578/-

per month, which is rounded off to Rs.2,600/- p.m.

Thus, the annual loss of income comes to (Rs.2,600/- x

12) Rs.31,200/-.

30. As regards to the multiplier, the Apex Court in

U.P. State Road Transport Corpn. v. Krishna Bala

& Ors., III (2006) ACC 361 (SC), has highlighted the

manner of fixing the appropriate multiplier and

computation of compensation and has observed as

under:

"6. Certain principles were highlighted by this Court in the case of Municipal Corporation of Delhi v. Subhagwanti, 1966 (3) SCR 649 in the matter of fixing the appropriate multiplier and computation of compensation. In a fatal accident action, the accepted measure of damages awarded to the dependents is the pecuniary loss suffered by them as a result of the death. "How much has the widow and family lost by the father's death?" The answer to this lies in the oft-quoted passage from the opinion of Lord Wright in Davies v. Powell Duffryn Associated Collieries Ltd., All ER p.665 A-B, which says:-

"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 or expended 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. That sum, however, has to be taxed down by having due regard to

uncertainties, for instance, that the widow might have again married and thus ceased to be dependent, and other like matters of speculation and doubt."

7. There were two methods adopted to determine and for calculation of compensation in fatal accident actions, the first the multiplier mentioned in Davies case (supra) and the second in Nance v. British Columbia Electric Railway Co. Ltd., 1951 (2) All ER

448.

8. The multiplier method involves the ascertainment of the loss of dependency or the multiplicand having regard to the circumstances of the case and capitalizing the multiplicand by an appropriate multiplier. The choice of the multiplier is determined by the age of the deceased (or that of the claimants whichever is higher) and by the calculation as to what capital sum, if invested at a rate of interest appropriate to a stable economy, would yield the multiplicand by way of annual interest. In, ascertaining this, regard should also be had to the fact that ultimately the capital sum should also be consumed-up over the period for which the dependency is expected to last."

Further Court held that;

"10. In regard to the choice of the multiplicand the Halsbury's Laws of England in Vol. 34, Para 98 states the principle thus:

"98. Assessment of damages under the Fatal Accidents Act 1976- The courts have evolved a method for calculating the amount of pecuniary benefit that dependants could reasonably expect to have received from the deceased in the future. First the annual value to the dependants of those benefits (the multiplicand) is assessed. In the ordinary case of the death of a wage-earner that figure is arrived at by deducting from the wages the estimated amount of his own personal and living expenses.

The assessment is split into two parts. The first part comprises damages for the period between death and trial. The multiplicand is multiplied by the number of years which have elapsed between those two dates. Interest at one-half the short-term investment rate is also awarded on that multiplicand. The second part is damages for the period from the trial onwards. For that period, the number of years which have elapsed between the death and the trial is deducted from a multiplier based on the number of years that the

expectancy would probably have lasted; central to that calculation is the probable length of the deceased's working life at the date of death."

11. As to the multiplier, Halsbury states:

"However, the multiplier is a figure considerably less than the number of years taken as the duration of the expectancy. Since the dependants can invest their damages, the lump sum award in respect of future loss must be discounted to reflect their receipt of interest on invested funds, the intention being that the dependants will each year draw interest and some capital (the interest element decreasing and the capital drawings increasing with the passage of years), so that they are compensated each year for their annual loss, and the fund will be exhausted at the age which the court assesses to be the correct age, having regard to all contingencies. The contingencies of life such as illness, disability and unemployment have to be taken into account. Actuarial evidence is admissible, but the courts do not encourage such evidence. The calculation depends on selecting an assumed rate of interest. In practice about 4 or 5 per cent is selected, and inflation is disregarded. It is assumed that the return on fixed interest bearing securities is so much higher than 4 to 5 per cent that rough and ready allowance for inflation is

thereby made. The multiplier may be increased where the plaintiff is a high tax payer. The multiplicand is based on the rate of wages at the date of trial. No interest is allowed on the total figure."

31. The Apex Court in Tamil Nadu State Transport

Corporation Ltd. v. S. Rajapriya & Ors. II (2005)

ACC 476 (SC) has observed as under;

"8. The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have lived or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether.

9. The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependants, and to deduct there from such part of

his income as the deceased was accustomed to spend upon himself, as regards both self-maintenance and pleasure and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependants. Then that should be capitalized by multiplying it by a figure representing the proper number of years‟ purchase.

10. Much of the calculation necessarily remains in the realm of hypothesis "and in that region arithmetic is a good servant but a bad master" since there are so often many imponderables. In every case "it is the over-all picture that matters" and the court must try to assess as best as it can the loss suffered."

32. Thus, in view of above decisions, the Tribunal has

rightly applied multiplier of 14 in the present case.

Thus, the total loss of dependency, after applying

multiplier of 14, comes to Rs.4,36,800/- (Rs.31,200 x

14).

33. Regarding interest, the petition was filed in July,

2001. The issues were framed in August, 2002 but the

appellants completed their evidence only in January,

2004. Thus, the Tribunal rightly awarded interest for

two years.

34. In view of the above discussion, the award given

by the Tribunal is modified to the extent that

appellants are entitled to enhanced compensation of

Rs.1,27,400/- (i.e. Rs. 4,36,800/- - Rs.3,09,400/-)on

account of loss of dependency.

35. Appellants are also entitled to interest @ 8% per

annum from the date of judgment of the Trial Court

(i.e., w.e.f. 11th October, 2004) till realization on this

enhanced compensation only.

36. Accordingly, the present appeal stands allowed to

the above extent, with costs.

37. Trial court record be sent back.

October 3, 2008                     V.B.GUPTA, J.
rs