Delhi High Court
Usha Grover & Ors. vs Hdfc Ergo General Insurance Co. ... on 19 July, 2012
Author: G.P. Mittal
$~17
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision:19th July, 2012
+ MAC. APP. No.503/2011
USHA GROVER & ORS.
..... Appellant
Through: Mr.Kundan Kumar Lal,
Advocate
Versus
HDFC ERGO GENERAL INSURANCE CO. LTD. & ORS.
..... Respondents
Through: Ms. Neerja Sachdeva,
Advocate for the Respondent 1
Insurance Company.
CORAM:
HON'BLE MR. JUSTICE G.P.MITTAL
JUDGMENT
G. P. MITTAL, J. (ORAL)
1. The Appeal is for enhancement of compensation of `9,73,176/-
awarded for the death of Bhim Sain Grover who died in a motor
vehicle accident which occurred on 13.03.2010.
2. The finding on negligence reached by the Motor Accident
Claims Tribunal(the Claims Tribunal) is not challenged by any
of the Respondents. Thus, the same has attained finality.
3. During inquiry before the Claims Tribunal, it was proved that
the deceased Bhim Sain Grover was working as Chief Manager
in Senior Management Scale Grade IV in Service Branch of
State Bank of Patiala. At the time of his death, he was drawing
a gross salary of `44,994/- which was retrospectively increased
to `55,624/- on account of revision of pay as per bipartite
settlement and the deceased was paid arrears of `2,25,250.42P.
The deceased was aged more than 59 years and was about to
retire in four months. The Claims Tribunal, therefore, awarded
a compensation of `1,79,976/- on the basis of the deceased's
salary at the time of his death and then granted the loss of
dependency on the minimum wages of a graduate by applying a
multiplier of '9'.
4. It is urged by the learned counsel for the Appellant that retired
bank officers at senior positions have very good future
prospects in non-banking financial companies as well as in
multinational companies. The deceased would have got
employment on a much better salary after the age of his
superannuation. It is contended that the Claims Tribunal was
not entitled to take a split multiplier till the date of retirement on
the basis of the salary drawn by him in State Bank of Patiala
and on the minimum wages of a graduate after the date of
superannuation. Reliance is placed on K.R. Madhusudhan &
Ors. v. Administrative Officer and Anr., (2011) 4 SCC 689.
5. In K.R. Madhusudhan & Ors.(supra), the High Court had
applied a split multiplier i.e. one till the age of superannuation
and the other since the age of superannuation. The Supreme
Court had deprecated the practice of applying the split
multiplier. Paras 4, 5 and 14 of the report are extracted
hereunder:
"4. The deceased was of 53 years of age and was
survived by his wife and three sons, the present
appellants. They filed a claim petition under Section 166
of the Motor Vehicles Act, 1988 claiming Rs.20,00,000/-
as compensation. It was contested by the respondents.
5. Motor Accident Claims Tribunal (hereinafter
"MACT") found that the death of V. Rajagopalaiah was
due to the rash and negligent driving of the van driver
(the second respondent). The deceased was working as
Senior Assistant in Karnataka Electricity Board
(hereinafter "KEB") and his last drawn gross monthly
salary was Rs.15,642/- i.e. Rs.1,87,704/- annually. 1/3rd
was deducted for personal expenses, after which the
amount came to Rs.1,25,136/-. As deceased was 53
years of age, a multiplier of 11 was applied. The
Tribunal also awarded funeral and transport expenses
amounting to Rs.10,000/-, medical expenses prior to
death was Rs.6,000 and compensation for loss and
affection at Rs.25,000/-. Accordingly, total
compensation awarded was Rs.14,27,496/- along with
interest of 9% p.a.
xxx xxx xxx xxx
14. In view of this evidence the Tribunal should have
considered the prospect of future income while
computing compensation but the Tribunal has not done
that. In the appeal, which was filed by the appellants
before the High Court, the High Court instead of
maintaining the amount of compensation, granted by the
Tribunal, reduced the same. In doing so, the High Court
had not given any reason. The High Court introduced
the concept of split multiplier and departed from the
multiplier used by the Tribunal without disclosing any
reason therefore. The High Court has also not
considered the clear and corroborative evidence about
the prospect of future increment of the deceased. When
the age of the deceased is between 51 and 55 years the
multiplier is 11, which is specified in the II Column in
the II Schedule in the Motor Vehicles Act, and the
Tribunal has not committed any error by accepting the
said multiplier. This Court also fails to appreciate why
the High Court chose to apply the multiplier of 6."
6. The multiplier has to be applied on the multiplicant as per the
actual income of the deceased at the time of his death (Sarla
Verma & Ors. v. Delhi Transport Corporation & Anr., (2009) 6
SCC 121). The actual income of the deceased at the time of his
death was `55,624/- as the pay was revised retrospectively and
the arrears were paid to the legal representatives of the
deceased. Thus, the Claims Tribunal was not justified in
applying the split multiplier and reducing the multiplicand on
the age of superannuation. Moreover, the deceased was
working in a public sector bank. After his superannuation, he
would have been entitled to pension @ 50% of his salary. If he
would have sought any employment in any non-banking
financial company he would also have got the salary which he
was getting from State Bank of Patiala. The loss of dependency
after making deduction towards Income Tax and applying a
suitable multiplier comes to `34,52,928/-(`55,624/- x 12 -
92,000/-(Income Tax) x 2 ÷ 3 x 9). On addition of a notional
sum of `25,000/- towards loss of love and affection and
`10,000/- each towards loss to estate, loss of consortium and
funeral expenses, the overall compensation comes to
`35,07,928/-.
7. The enhanced compensation of `25,34,752/- shall carry interest
@ 7.5% per annum. The Respondent Insurance Company is
directed to deposit the enhanced compensation with interest in
the name of the Appellants with UCO Bank, Delhi High Court
Branch within six weeks.
8. 40% of the enhanced compensation along with proportionate
interest shall be payable to the Appellant No.2. Rest 60% shall
be payable to the First Appellant.
9. 80% of the enhanced compensation shall be held in Fixed
Deposit for a period of two years, four years, six years and eight
years in equal proportion. Rest shall be released to the
Appellants on deposit.
10. The Appeal is allowed in above terms.
11. Pending Applications stand disposed of.
(G.P. MITTAL)
JUDGE
JULY 19, 2012
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