Phoolwati & Ors. vs Krs Panikar & Ors.
2009 Latest Caselaw 1666 Del

IN THE HIGH COURT OF DELHI AT NEW DELHI

                  FAO No. 207/2003

                           Judgment reserved on: 21.2.2009
                           Judgment delivered on: 27.4.2009


Phoolwati & Ors.                    ..... Appellants.
                      Through: Mr V P Chaudhary, Sr. Adv.
                               With Mr. Nintinjya Chaudhry,
                               Adv.



                      versus

KRS Panikar & Ors.
                                    ..... Respondents
                      Through: Shri A K De, Adv.

    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         NO
   in the Digest?


KAILASH GAMBHIR, J.

FAO No.207/2003 Page 1 of 1 2

1. The present appeal arises out of the award dated 31.10.2002

of the Motor Accident Claims Tribunal whereby the Tribunal

awarded a sum of Rs. 2,00,000/- along with interest @ 9% per

annum to the claimants.

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

3. On 21.9.1992 at around 9 PM, deceased Kushal Pal Singh

aged about 14 years boarded the bus bearing registration No: DL

1P 1192 from Bhogal for going to Ashram. He was standing near

the rear gate. When the bus was near the round about of

Rajdoot Hotel, the driver of the bus tried to negotiate sharp turn

without slowing down the speed and on account of the abrupt

sharp turn at the round about at a high speed, the deceased

Kushal Pal Singh who was standing in the bus by the side of the

rear gate fell down of the moving bus, as a result of which he

suffered fatal injuries to which he succumbed later on.

4. A claim petition was filed on 3.10.1996 and an award was

passed on 31.10.2002. Aggrieved with the said award

enhancement is claimed by way of the present appeal.

FAO No.207/2003 Page 2 of 1 2

5. Mr. V.P. Chaudhary, Sr. Advocate for the appellants

submitted that the tribunal erred in awarding Rs. 2,00,000/- as

lumpsum compensation instead of applying multiplier method

and assessing income of the deceased at Rs. 25,000/- after

considering future prospects, and applying multiplier of 18 while

computing compensation. 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 @ 15%

per annum in place of only 9% per annum. The counsel

contended that the tribunal has erred in not awarding

compensation towards loss of love & affection, funeral expenses,

loss of estate, mental pain and sufferings and the loss of services,

which were being rendered by the deceased to the appellants.

6. Per Contra Mr. A.K. De, counsel for respondent insurance

company submitted that there is no illegality in the impugned

award. Counsel further contended that award passed by Tribunal

is absolutely fair, just and reasonable and no fault can be found

with the same.

FAO No.207/2003 Page 3 of 1 2

7. I have heard learned counsel for the parties 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 capitalised by

FAO No.207/2003 Page 4 of 1 2 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.

9. 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

FAO No.207/2003 Page 5 of 1 2 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."

10. Thus, the tribunal erred in awarding a lumpsum

amount to the appellants.

11. 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

FAO No.207/2003 Page 6 of 1 2 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.

12. 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.

FAO No.207/2003 Page 7 of 1 2

13. This case pertains to the year 1993 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 Lata Wadhwa and Ors. v. State

of Bihar and Ors. - (2001) 8 SCC 197.

14. In Lata Wadhwa's case (supra) while computing

compensation, the Apex Court made distinction between

deceased children falling within the age group of 5 to 10 years

and age group of 10 to 15 years. In the said case, the Apex Court

had awarded Rs. 1,50,000/- as pecuniary damages and Rs.

50,000/- towards non-pecuniary damages to the claimants of the

deceased children falling within the age group of 5 to 10 years

and in case of the children falling within the age group of 10 to 15

years, the Court decided that the multiplier method should be

applied and the contribution of the children to the family was

taken to be at Rs. 24,000/-pa and then a multiplier of 15 was

applied and over and above that the conventional compensation

of Rs.50,000/- had been added to it, making the total

compensation as Rs. 3,60,000/-.

FAO No.207/2003 Page 8 of 1 2

15. In the light of the above discussion, I would assess the

compensation in the instant case. It has come on record that the

deceased at the time of the accident was of 14 years of age and

was studying in VIII standard. The Pw1 father of the deceased

deposed that the deceased was a healthy and an intelligent child

and was to be given higher education. But nothing has come on

record to prove the income of the deceased.

16. The tribunal should have atleast assessed the income as

that of an skilled workman on the basis of the minimum wages

notified under the Minimum Wages Act prevailing at the time of

the accident i.e. at Rs. 1259/- pm.

17. Furthermore, 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

FAO No.207/2003 Page 9 of 1 2 and cost of living, minimum wages virtually double after every 10

years. For instance, minimum wages of skilled labourers as on

1.1.1980 was Rs. 320/- per month and same rose to Rs. 1,083/-

per month in the year 1990. Meaning thereby, from year 1980 to

year 1990, there there has been an increase of nearly 238% in

the minimum wages. Thus, it could safely be assumed that

income of the deceased would have doubled in the next 10 years.

18. Also, since in catena of cases the Apex Court has in similar

circumstances made 1/3rd deductions. Therefore, 1/3rd deductions

towards personal expenses is made.

19. Also, considering that this case pertains to the year 1992

and at that time II schedule to the Motor Vehicles Act had already

been brought on the statute book. The age of the deceased at

the time of the accident was 13 years and he is survived by his

parents and the age of the father at the time of the accident was

45 years. 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

considering the multiplier applicable as per the II Schedule to the

MV Act, the multiplier of 15 shall be applicable.

FAO No.207/2003 Page 10 of 1 2

20. Also, 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/-.

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 1/3 rd

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 15 it comes to Rs.

2,26,620/-. Thus, the total loss of dependency comes to Rs.

2,26,620/-. After considering Rs. 40,000/-, which is granted

towards non-pecuniary damages, the total compensation comes

out as Rs. 2,66,620/-.

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

enhanced to Rs. 2,66,620/- from Rs. 2,00,000/- with interest on

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

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

FAO No.207/2003 Page 11 of 1 2 appellants in equal proportion by the respondent no. 3 as

directed by the tribunal and within30 days of this order.

23. With the above directions, the present appeal is disposed

of.

April 27, 2009                          KAILASH GAMBHIR, J.




FAO No.207/2003                                        Page 12 of 1 2