Sh Om Prakash Mahendra & Ors. vs Sh Nasiruddin & Ors
2009 Latest Caselaw 1330 Del

        * IN THE HIGH COURT OF DELHI AT NEW DELHI

+                      FAO No. 178/2003

%                      Judgment reserved on: 15.2.2008
                       Judgment delivered on: 13.4.2009


Sh. Om Prakash Mahendra & Ors.               ...... Appellant
                   Through: Mr. O.P. Mannie, Adv.

                                  versus


Sh. Nasiruddin & Ors                                ..... Respondents
                       Through: Nemo.

CORAM:
HON'BLE MR. JUSTICE KAILASH GAMBHIR

1.   Whether the Reporters of local papers may
     be allowed to see the judgment?                               No

2.   To be referred to Reporter or not?                            No

3.   Whether the judgment should be reported
     in the Digest?                                                No


KAILASH GAMBHIR, J.

1. The present appeal arises out of the award dated 4 th December

2002 of the Motor Accident Claims Tribunal whereby the Tribunal

awarded a sum of Rs. 1,40,000 along with interest @ 9% per annum to

the claimants.

2. The brief conspectus of the facts is as follows:

3. The deceased Sh. Jitendra Mahendera was a young man of 25 yrs

of age and was doing business under the name and style of M/s J.K.

Diesels at Kashmere Gate, Delhi. On 11th March 1992, at about 2:50

P.M., the said deceased was driving a motor cycle and was coming

form the side of the Red Fort on Subhash Marg and was going towards

Darya Ganj and when he reached near T-point of Subhash Park he

stopped his motor cycle at the red light and in the meantime was hit

from behind by a CRPF truck, bearing registration No. BRX 2008,

which was being driven rashly and negligently. The impact was so

grave that due to the sudden force, the deceased received several

fatal injuries and became unconscious. He was removed to L.N.J.P

Hospital where he succumbed to his injuries after some days.

4. A claim petition was filed on 6th April 1992 and an award was

made on 4th December 2002. Aggrieved with the said award

enhancement is claimed by way of the present appeal.

5. The appellants have assailed the said award on quantum of

compensation. Sh. O. P. Mannie, Counsel for the appellants contended

that the tribunal erred in passing a lump sum amount of Rs. 1,40,000/-

without taking into consideration, the set principles of law and

guidelines for computing the compensation payable to the claimants

as laid down by the Apex Court and various High Court in various

decisions. The case of the appellant is that after assessing the income

of the deceased at Rs. 5,000/-per month as per the evidence on record,

the Learned Tribunal should have taken into account the future

prospects to assess the monthly income of deceased at Rs. 10,000/-

per month and then should have assessed the just compensation

according to the multiplier method. Further, the counsel submitted that

the tribunal should have applied the multiplier of 17 looking at the

young age of the deceased. The counsel also raised the contention

that the rate of interest allowed by the tribunal is on the lower side and

the tribunal should have allowed simple interest @ 12% per annum in

place of only 9% per annum. The counsel contended that the tribunal

erred in not awarding any sort of non pecuniary damages towards loss

of love & affection, funeral expenses, loss of estate, loss of consortium,

mental pain and sufferings and the loss of services, which were being

rendered by the deceased to the appellants.

6. Nobody has appeared for the respondents although counter

affidavit was filed by the respondents. The respondents in their

counter submitted that the tribunal rightly allowed lumpsum

compensation as in the absence of proof of income, multiplier method

cannot be applied. It is also submitted that the deceased died due to

his negligence and he was also not having a driver's licence at the time

of the accident and therefore no interference should be made in the

award.

7. I have heard learned counsel for the appellants and perused the

record.

8. The assessment of damages to compensate the dependants is

beset with difficulties because while doing so, many imponderables

have to be taken in to account, 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. 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 therefrom 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 year's purchase. In this relation, the

Apex Court has held in plethora of judgments that the multiplier

method is the best method.

In this regard in G.M., Kerala SRTC v. Susamma Thomas, (1994) 2 SCC 176 the Hon'ble Apex Court observed as under:

"12. There were two methods adopted for determination and for calculation of compensation in fatal accident actions, the first the multiplier mentioned in Davies case3 and the second in Nance v. British Columbia Electric Railway Co. Ltd.

13. 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.

16. It is necessary to reiterate that the multiplier method is logically sound and legally well-established. There are some cases which have proceeded to determine the compensation on the basis of aggregating the entire future earnings for over the period the life expectancy was lost, deducted a percentage therefrom towards uncertainties of future life and award the resulting sum as compensation. This is clearly unscientific. For instance, if the deceased was, say 25 years of age at the time of death and the life expectancy is 70 years, this method would multiply the loss of dependency for 45 years -- virtually adopting a multiplier of 45 -- and even if one-third or one-fourth is deducted therefrom towards the uncertainties of future life and for immediate lump sum payment, the effective multiplier would be between 30 and 34. This is wholly impermissible. We are, aware that some decisions of the High Courts and of this Court as well have arrived at compensation on some such basis. These decisions cannot be said to have laid down a settled principle. They are merely instances of particular awards in individual cases. The proper method of computation is the multiplier-method. Any departure, except in

exceptional and extraordinary cases, would introduce inconsistency of principle, lack of uniformity and an element of unpredictability for the assessment of compensation. Some judgments of the High Courts have justified a departure from the multiplier method on the ground that Section 110-B of the Motor Vehicles Act, 1939 insofar as it envisages the compensation to be 'just', the statutory determination of a 'just' compensation would unshackle the exercise from any rigid formula. It must be borne in mind that the multiplier method is the accepted method of ensuring a 'just' compensation which will make for uniformity and certainty of the awards. We disapprove these decisions of the High Courts which have taken a contrary view. We indicate that the multiplier method is the appropriate method, a departure from which can only be justified in rare and extraordinary circumstances and very exceptional cases."

9. In view of the aforesaid legal position, the tribunal erred in

awarding a lumpsum amount to the appellants petitioners.

10. On perusal of the award it is manifest that Sh. O.P. Mahindra,

father of the deceased was examined as PW1 and he had deposed that

the deceased was dealing in oil engine parts and had a business in the

name & style of J.K. Dealers. The said witness also deposed that said

shop of the deceased was not registered. He also deposed that the

deceased was earning Rs.5000 pm and he started the said business

only 2 years back. In the statement of the said witness it has appeared

that the documents regarding the business of the deceased were filed.

It was also mentioned in the cross examination of the said witness that

the sales tax returns were filed. But no such documents have been

found in the lower court record. After considering all these factors I am

of the view that the income of the deceased should be assessed as per

the Minimum Wages Act for a skilled workman as on the date of the

accident at Rs. 1259/- p.m.

11. It is no more res integra that mere bald assertions regarding the

income of the deceased are of no help to the claimants in the absence

of any reliable evidence being brought on record.

12. The thumb rule is that in the absence of clear and cogent

evidence pertaining to income of the deceased learned Tribunal should

determine income of the deceased on the basis of the minimum wages

notified under the Minimum Wages Act.

13. Thus, the income of the deceased is assessed in accordance with

the minimum wages notified under the Minimum Wages Act.

14. As regards the future prospects, it has been the consistent view

of this court that whenever aid of Minimum Wages Act is taken while

computing income, then increase in minimum wages should also be

considered. It is well settled that future prospects are not akin to

increase in minimum wages. To neutralize increase in cost of living and

price index, the minimum wages are increased from time to time. A

perusal of the minimum wages notified under the Minimum Wages Act

show that to neutralize increase in inflation and cost of living,

minimum wages virtually double after every 10 years. Thus, it could

safely be assumed that income of the deceased would have doubled in

the next 10 years.

15. Therefore, the increase in minimum wages, while assessing the

income of the deceased should be considered for computing

compensation towards loss of dependency.

16. As regards the deduction, I feel that 1/3 rd deduction shall be just

and fair in the facts and circumstances of the case and considering

that he is survived by his aged parents. In catena of cases the Apex

Court has in similar circumstances made 1/3rd deductions. Therefore, I

am inclined to award 1/3rd deductions towards personal expenses.

17. As regards the multiplier, I feel that multiplier of 8 shall serve the

interest of justice. This case pertains to the year 1992 and at that time

II schedule to the Motor Vehicles act was not brought on the statute

books. The said schedule came on the statute book in the year 1994

and prior to 1994 the law of the land was as laid down by the Hon'ble

Apex Court in 1994 SCC (Cri) 335, G.M., Kerala SRTC v. Susamma

Thomas. In the said judgment it was observed by the Court that

maximum multiplier of 16 could be applied by the Courts, which after

coming in to force of the II schedule has risen to 18. At the time of the

accident, the deceased was of 24 years of age and the appellant No. 1

father of the deceased was aged 54 the years and the appellant No. 2

mother of the deceased was a 49 years of age. In the facts of the

present case I am of the view that after looking at the age of the

claimants and the deceased and after taking a balanced view after

considering applicable multiplier under Schedule II to the MV Act the

multiplier of 8 should be applied. Therefore, in the facts of the instant

case the multiplier of 8 shall be applicable.

18. As regards the issue of interest that the rate of interest of 9% p.a.

awarded by the tribunal is on the lower side and the same should be

enhanced to 12% p.a., I feel that the rate of interest awarded by the

tribunal is just and fair and requires no interference. No rate of interest

is fixed under Section 171 of the Motor Vehicles Act, 1988. The Interest

is compensation for forbearance or detention of money and that

interest is awarded to a party only for being kept out of the money,

which ought to have been paid to him. Time and again the Hon'ble

Supreme Court has held that the rate of interest to be awarded should

be just and fair depending upon the facts and circumstances of the

case and taking in to consideration relevant factors including inflation,

policy being adopted by Reserve Bank of India from time to time and

other economic factors. In the facts and circumstances of the case, I do

not find any infirmity in the award regarding award of interest @ 9% pa

by the tribunal and the same is not interfered with.

19. As regards the non-pecuniary compensation towards loss of love

& affection, funeral expenses and loss of estate and the loss of

services, which were being rendered by the deceased to the

appellants, In this regard I feel that the compensation towards loss of

love and affection should be awarded at Rs. 20,000/-; compensation

towards funeral expenses should be awarded at Rs. 10,000/- and

compensation towards loss of estate should be awarded at Rs. 10,000/-

20. As far as the contention pertaining to the awarding of amount

towards mental pain and sufferings caused to the appellants due to the

sudden demise of their son and the loss of services, which were being

rendered by the deceased to the appellants is concerned, I do not feel

inclined to award any amount as compensation towards the same as

the same are not conventional heads of damages.

21. On the basis of the discussion, the income of the deceased would

come to Rs. 1,888.50 after doubling Rs. 1,259 to Rs. 2,518 and after

taking the mean of them. After making 1/3rd deductions the monthly

loss of dependency comes to Rs. 1,259 and the annual loss of

dependency comes to Rs. 15,108 per annum and after applying

multiplier of 8 it comes to Rs. 1,20,864/-. Thus, the total loss of

dependency comes to Rs. 1,20,864/-. After considering Rs. 40,000/-,

which is awarded towards non-pecuniary damages, the total

compensation comes out as Rs. 1,60,864/-.

22. As regards the issue of negligence, it has come on record that

PW2 Vimal Bajaj eye -witness to the accident and the rukka Ex.PB

prove that the deceased on his motorcycle was standing at the red

light near Subhash Park T-point and the offending CRPF truck which

was being driven in a rash and negligent manner hit the motor cycle

from behind due to which the deceased sustained fatal injuries.

Considering the deposition of RW1 the driver of the said offending

vehicle, who is an interested witness, it is manifest that he is trying to

save himself. Be that as it may, no negligence can be imputed to the

deceased in absence of any proof. Thus, no interference is made in

the award on this court. As regards the issue that the deceased was

driving the motorcycle without having a licence. The said issue is

being raised for the first time before this court and same cannot be

raised at this stage.

23. In view of the above discussion, the total compensation is

enhanced to Rs. 1,60,864/- from Rs. 1,40,000/- with interest @ 7.5%

per annum from the date of filing of the petition till realisation and the

same should be paid to the appellants, in equal proportion, by the

respondent nos. 2 and 3.

24. With the above direction, the present appeal is disposed of.

13th April,2009                        KAILASH GAMBHIR, J