Santosh Kumar vs Rohit Kumar Dhawan
2009 Latest Caselaw 1484 Del

     IN THE HIGH COURT OF DELHI AT NEW DELHI

                       MAC No. 215/2004

                       Judgment reserved on 14.3.2008

                       Judgment delivered on: 20.4.2009


Santosh Kumar                            ..... Appellant.
                       Through: Mr.S.N. Prashar, Adv.

                       Versus

Rohit Kumar Dhawan                            ..... Respondent
                 Through: Nemo.

CORAM:
HON'BLE MR. JUSTICE KAILASH GAMBHIR,

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

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 23/1/2004

of the Motor Accident Claims Tribunal whereby the Tribunal

awarded a sum of Rs. 1,50,000/- along with interest @ 9% per

annum to the claimants.

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

3. On 26/11/2001 at about 6:00 pm Sh. Arjun was travelling by

bus bearing registration no. DL 1PA 6274 and when the said bus

reached at Sardar Manmohan Marg, West Punjabi Bagh, then the

driver of the said bus took a sharp turn without slowing down the

speed in a rash and negligent manner. Due to this, Sh. Arjun fell

out of the bus on the road and he sustained serious injuries all

over the body and later he succumbed to the said injuries.

A claim petition was filed on 15/1/2001 and an award was

passed on 23/1/2004. Aggrieved with the said award

enhancement is claimed by way of the present appeal.

4. Sh. S.N. Prashar counsel for the appellants contended that

the tribunal erred in awarding compensation on lump sum basis

and should have assessed the income of the deceased at Rs.

15,000/- per annum and applied the multiplier of 15 after making

1/3 rd deductions as per the II Schedule as the deceased was of

13 years of age and was studying in VI standard. The counsel

further maintained that the tribunal should have considered

future increase in income as well. The counsel contended that the

tribunal has erred in not awarding compensation 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.

5. Nobody appeared for the respondents.

6. I have heard the learned counsel for the appellants and

perused the record.

7. 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 capitalised 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.

8. 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. Thus, the tribunal erred in awarding a lumpsum amount to

the appellants.

10. PW1 Santosh Kumar had proved on record that the

deceased was of 13 years of age at the time of his death and was

studying in class VI at the time of the accident. 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. . In case of the death of

an infant, there may have been no actual pecuniary benefit

derived by its parents during the child's life-time. 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 expectation 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. MANU/SC/0456/2001)

11. In view of the above discussion, I feel that since this case

pertains to the year 2001 and at that time the II Schedule to the MV

Act had already come on the statute book, therefore, Rs. 15,000/- pa

should have been assessed as the income of the deceased.

Furthermore, under sub section (3) of Section 163-A, the government

should revise the wages mentioned in the II Schedule. Since, the

government failed to do the same, therefore, increase in minimum

wages is also considered in the instant case. 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.

12. Also considering that the petition is filed by the parents of the

deceased I feel that 1/3 deduction in the facts of the case should be

made towards personal expenses. Further considering that the

deceased was of 13 years of age at the time of the accident and his

father was of 33 years of age and also considering that this case

pertains to the year 2001 and at that time II schedule to the

Motor Vehicles Act had already been brought on the statute book,

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

considering the multiplier applicable as per the II Schedule to the

MV Act, the multiplier of 15 should have been applied.

13. As regards the issue of interest that the rate of interest of

12% p.a. awarded by the tribunal is on the lower side and the

same should be enhanced to 15% 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 @ 12% pa by the tribunal and the

same is not interfered with.

14. Furthermore, compensation towards loss of love and

affection is awarded at Rs. 20,000/-; compensation towards

funeral expenses is awarded at Rs. 10,000/- and compensation

towards loss of estate is awarded at Rs. 10,000/-.

15. On the basis of the discussion, the income of the deceased

would come to Rs. 22,500/- after doubling Rs. 15,000/- to Rs.

30,000/- and after taking the mean of them. After making 1/3 rd

deductions the annual loss of dependency comes to Rs. 15,000/-

per annum and after applying multiplier of 15 it comes to Rs.

2,25,000/-. Thus, the total loss of dependency comes to Rs.

2,25,000/-. After considering Rs. 40,000/-, which is granted

towards non pecuniary damages, the total compensation comes

out as Rs. 2,65,000/-.

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

enhanced to Rs. 2,65,000/- from Rs. 1,50,000/- with interest on

the differential amount @ 7.5% per annum from the date of filing

of the petition till realisation and the same should be paid to the

appellants by the respondent no. 3 insurance company in the

same proportion as awarded by the tribunal.

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

20.4.2009                              KAILASH GAMBHIR,J.