Delhi High Court
Shriram General Insurance Co. Ltd vs Maneesha Karnatak And Ors. on 20 March, 2015
$~35
* IN THE HIGH COURT OF DELHI AT NEW DELHI
Date of decision: 20th March, 2015
+ MAC.APP. 655/2014
SHRIRAM GENERAL INSURANCE CO. LTD...... Appellant
Through: Mr. K.L. Nandwani, Adv. with
Mr. Sameer Nandwani, Adv. and
Mr. Manish Kaushik, Adv.
versus
MANEESHA KARNATAK AND ORS. ..... Respondents
Through: Mr. Harsh Vardhan, Adv.
CORAM:
HON'BLE MR. JUSTICE G.P.MITTAL
G. P. MITTAL, J. (ORAL)
1. The appeal is directed against the judgment dated 20.05.2014 passed
by the Motor Accident Claims Tribunal (the Claims Tribunal)
whereby compensation of `29,70,000/- was awarded in favour of
Respondents No.1 and 2 for the death of Saurabh Karnatak, a bachelor
who suffered fatal injuries in a motor vehicular accident which
occurred on 28.07.2012.
2. The following contentions are raised by the learned counsel for the
Appellant Shriram General Insurance Company Limited:-
(i) The Claims Tribunal found contributory negligence on the part
of the driver of the Alto car; in spite of this, the entire liability
was fastened on the owner and insurer of the other vehicle i.e.
the truck bearing registration no. HR-38J-7610;
(ii) There was no evidence with regard to deceased's future
prospects; in spite of this, addition of 50% was made towards the
same which was not permissible. Reliance is placed upon
Reshma Kumari and Ors. v. Madan Mohan and Anr., (2013) 9
SCC 65; and
(iii) The appropriate multiplier is always as per the age of the
deceased or the Claimant whichever is higher. In the instant
case, the multiplier ought to have been adopted as per the age of
the Claimants. The Claims Tribunal erred in adopting the
multiplier as per the age of the deceased.
3. On the other hand, learned counsel for Respondents No. 1 and 2
supports the impugned judgment. He states that the compensation
awarded is just and reasonable. It is urged that it was not a case of
contributory negligence but rather of composite negligence on the part
of the driver of the Alto car bearing registration no. UP-16-AH-4879
and the truck bearing registration no. HR-38J-7610. He states that in
case of composite negligence, the victim can recover the
compensation from either or any of the tortfeasors.
NEGLIGENCE
4. The Claims Tribunal found negligence on part of the drivers of both
the vehicles which is not challenged by the Appellant. The victim was
a third party travelling in the Alto car. In Bherlal v. Kamal Singh,
(2005) 2 TN MAC 39 (Mad), it was held by the Madras High Court
that in case of composite negligence, a third party travelling in one of
the vehicles will not be guilty of contributory negligence.
5. Further, in T.O. Anthony v. Karvarnani, (2008) 3 SCC 748, it was held
that where a person is injured on account of negligence on the part of
two or more wrongdoers, each wrongdoer will be jointly and severally
liable to the injured for payment of the entire damages and the injured
person has the choice of proceeding against all or any of the
wrongdoers. In para 6, the Supreme Court held as under:-
"6. „Composite negligence‟ refers to the negligence on
the part of two or more persons. Where a person is
injured as a result of negligence on the part of two or
more wrong doers, it is said that the person was injured
on account of the composite negligence of those wrong-
doers. In such a case, each wrongdoer, is jointly and
severally liable to the injured for payment of the entire
damages and the injured person has choice of proceeding
against all or any of them. In such a case, the injured
need not establish the extent of responsibility of each
wrong-doer separately, nor is it necessary for the court to
determine the extent of liability of each wrong-doer
separately. On the other hand where a person suffers
injury, partly due to the negligence on the part of another
person or persons, and partly as a result of his own
negligence, then the negligence of the part of the injured
which contributed to the accident is referred to as his
contributory negligence. Where the injured is guilty of
some negligence, his claim for damages is not defeated
merely by reason of the negligence on his part but the
damages recoverable by him in respect of the injuries
stands reduced in proportion to his contributory
negligence."
6. Thus, the Claims Tribunal's finding making the insurer of truck
bearing registration no. HR-38J-7610 liable to pay the entire
compensation cannot be faulted.
COMPENSATION
7. Deceased Saurabh Karnatak had obtained a degree in Bachelor of
Science (Hospitality and Hotel Administration) from Indira Gandhi
National Open University. He thereafter joined Barclays Services Pvt.
Ltd. In pursuance of the appointment letter dated 08.02.2010, he was
given a salary of `17,500/- per month or `2,10,000/- per annum which
included certain allowances like HRA, special allowance, voice
allowance, medical allowance, provident fund and performance
incentives. The Claims Tribunal relying on National Insurance Co.
Ltd. v. Indira Srivastava & Ors., 2008 (2) SCC 763, held that all the
allowances beneficial to the family have to be taken into consideration
for computation of income of the deceased. The reasoning in taking
the entire income of the deceased which was for the benefit of his
family to compute the loss of dependency, to my mind, cannot be
faulted.
FUTURE PROSPECTS
8. As far as grant of future prospects is concerned, the deceased joined
on the salary of `17,500/- per month in the year 2010. His salary
remained the same even after two years when this accident took place.
There is no evidence whatsoever produced by Respondents No. 1 and
2 to show that the deceased had bright future prospects. In the absence
of any increment for two years and in the absence of any evidence that
the deceased had bright future prospects, addition towards future
prospects was not permissible. The law laid down in Sarla Verma
(Smt.) & Ors. v. Delhi Transport Corporation & Anr., (2009) 6 SCC
121 was affirmed by a three Judge Bench decision of the Supreme
Court in Reshma Kumari and Ors. v. Madan Mohan and Anr., (2013)
9 SCC 65. The question was gone into at great length by this Court in
HDFC ERGO General Insurance Co. Ltd. v. Smt. Lalta Devi & Ors.,
MAC. APP. 189/2014 decided on 12.01.2015, wherein it was held that
in the absence of any evidence with regard to bright future prospects,
addition towards future prospects is not permissible.
9. In view of this, addition of 50% towards future prospects was not
permissible.
MULTIPLIER
10. Coming to the question of multiplier to be selected, the question of
selection of multiplier was dealt with at great length by me in Vijay
Laxmi & Anr. v. Binod Kumar Yadav & Ors., ILR (2012) 6 Del 447.
In that case, the learned counsel for the Appellant had relied on the
following judgments (i) Smt. Sarla Verma & Ors. v. Delhi Transport
Corporation & Anr., 2009 (6) SCC 121; (ii) Mohd. Ameeruddin v.
United India Insurance Co. Ltd., 2010 (12) SCALE 155; (iii) P.S.
Somanathan v. District Insurance Officer, I (2011) ACC 659 (SC);
(iv) Bilkish v. United India Insurance Co. Ltd. & Anr., 2008 (4)
SCALE 25; (v) National Insurance Co. Ltd. v. Azad Singh & Ors.,
2010 ACJ 2384 (SC); (vi) Oriental Insurance Co. Ltd. v. Deo Patodi
& Ors., 2009 ACJ 2359 (SC) and (vii) Divisional Manager, New India
Assurance Co. Ltd. v. T. Chelladurai & Ors., 2010 ACJ 382 (SC).
11. I had discussed the law laid down in the earlier stated judgments and
had further referred to the judgments in General Manager, Kerala
State Road Transport Corporation, Trivandrum v. Susamma Thomas
(Mrs.) and Ors., (1994) 2 SCC 176; U.P. SRTC v. Trilok Chandara,
(1996) 4 SCC 362; Fakeerappa v. Karanataka Cement Pipe Factory,
(2004) 2 SCC 473 and New India Assurance Company Limited v.
Shanti Pathak (Smt.) & Ors., (2007) 10 SCC 1 to hold that the
multiplier has to be selected as per the age of the deceased or the
Claimant whichever is higher.
12. The learned counsel for Respondents No. 1 and 2 has submitted that
in view of the three Judge Bench decision in Reshma Kumari v.
Madan Mohan & Anr., (2009) 13 SCC 422 and a later judgment of the
Supreme Court in M. Mansoor & Anr. v. United India Insurance
Company Limited & Anr., (2013) 15 SCC 603, the judgment in Vijay
Laxmi (supra) of this Court needs to be revisited and the multiplier
has to be as per the age of the deceased and age of the Claimant is not
at all relevant for selection of the multiplier.
13. Section 168 of the Motor Vehicles Act, 1988 (the Act) enjoins a
Claims Tribunal to determine the amount of compensation which is
just and reasonable. It can neither be a source of profit nor should be a
pittance. In other words, it should not be meager nor should be a
windfall. In this connection, a reference may be made to the report of
the Supreme Court in State of Haryana v. Jasbir Kaur, (2003) 7 SCC
484, which dealt with the grant of compensation in case of injury
which principles equally apply in case of award of compensation in
fatal accident cases. In Para 7, the Supreme Court held as under:
"7. It has to be kept in view that the Tribunal constituted
under the Act as provided in Section 168 is required to make an
award determining the amount of compensation which is to be
in the real sense „damages‟ which in turn appears to it to be
„just and reasonable‟. It has to be borne in mind that
compensation for loss of limbs or life can hardly be weighed in
golden scales. But at the same time it has to be borne in mind
that the compensation is not expected to be a windfall for the
victim. Statutory provisions clearly indicate that the
compensation must be „just and it cannot be a bonanza; not a
source of profit; but the same should not be a pittance. The
courts and tribunals have a duty to weigh the various factors
and quantify the amount of compensation, which should be just.
What would be „just‟ compensation is a vexed question. There
can be no golden rule applicable to all cases for measuring the
value of human life or a limb. Measure of damages cannot be
arrived at by precise mathematical calculations. It would
depend upon the particular facts and circumstances, and
attending peculiar or special features, if any. Every method or
mode adopted for assessing compensation has to be considered
in the background of „just‟ compensation which is the pivotal
consideration. Though by use of the expression „which appears
to it to be just‟ a wide discretion is vested in the Tribunal, the
determination has to be rational, to be done by a judicious
approach and not the outcome of whims, wild guesses and
arbitrariness. The expression „just‟ denotes equitability,
fairness and reasonableness, and non-arbitrary. If it is not so it
cannot be just."
14. Initially, the trend of the Courts was to ascertain the life expectancy,
deduct the age of the deceased and to award the compensation on the
basis of the residual life span. The Courts started deducting certain
sums out of the sum as arrived above on account of lump sum
payment.
15. However, in General Manager, Kerala State Road Transport
Corporation, Trivandrum v. Susamma Thomas (Mrs.) and Ors.,
(1994) 2 SCC 176, an attempt was made for the first time to award
just and reasonable compensation on the basis of the multiplier
method. The Supreme Court referred to the report in Gobald Motor
Service Ltd. & Anr. v. R.M.K. Veluswami & Ors., AIR 1962 SC 1 and
observed that actual pecuniary loss can be ascertained only by
balancing, on one hand, the loss to the Claimant of the future
pecuniary benefits and on the other hand, any pecuniary advantage
which from whatever sources comes to them by reason of death.
Paras 8 and 9 of the report in Susamma Thomas (Mrs.) (supra) are
extracted hereunder:-
"8. The measure of damage is the pecuniary loss suffered
and is likely to be suffered by each dependant. Thus "except
where there is express statutory direction to the contrary, the
damages to be awarded to a dependant of a deceased person
under the Fatal Accidents Acts must take into account any
pecuniary benefit accruing to that dependant in consequence of
the death of the deceased. It is the net loss on balance which
constitutes the measure of damages." (Per Lord Macmillan
in Davies v. Powell [(1942) AC 601, 617 : (1942) 1 All ER 657
(HL)].) Lord Wright in the same case said, "The actual
pecuniary loss of each individual entitled to sue can only be
ascertained by balancing on the one hand the loss to him of the
future pecuniary benefit, and on the other any pecuniary
advantage which from whatever source comes to him by reason
of the death". These words of Lord Wright were adopted as the
principle applicable also under the Indian Act in Gobald Motor
Service Ltd. v. R.M.K. Veluswami [AIR 1962 SC 1 : (1962) 1
SCR 929 : 1962 MLJ (Cri) 120] where the Supreme Court
stated that the general principle is that the actual pecuniary
loss can be ascertained only by balancing on the one hand the
loss to the claimants of the future pecuniary benefit and on the
other any pecuniary advantage which from whatever source
comes to them by reason of the death, that is, the balance of
loss and gain to a dependant by the death, must be ascertained.
9. 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."
16. The Supreme Court referred to Davies v. Powell, (1942) AC 601 and
Nance v. British Columbia Electric Railway Company Limited, (1951)
AC 601 and in Paras 13 and 14 of the report in Susamma Thomas
(Mrs.) (supra), the Supreme Court observed as under:-
"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.
14. The considerations generally relevant in the selection
of multiplicand and multiplier were adverted to by Lord
Diplock in his speech in Mallett case [Mallett v.McMonagle,
(1970) AC 166 : (1969) 2 All ER 178 (HL)] where the deceased
was aged 25 and left behind his widow of about the same age
and three minor children. On the question of selection of
multiplicand Lord Diplock observed:
"The starting point in any estimate of the amount of the
„dependency‟ is the annual value of the material benefits
provided for the dependants out of the earnings of the
deceased at the date of his death. But ... there are many
factors which might have led to variations up or down in
the future. His earnings might have increased and with
them the amount provided by him for his dependants.
They might have diminished with a recession in trade or
he might have had spells of unemployment. As his
children grew up and became independent the proportion
of his earnings spent on his dependants would have been
likely to fall. But in considering the effect to be given in
the award of damages to possible variations in the
dependency there are two factors to be borne in mind.
The first is that the more remote in the future is the
anticipated change the less confidence there can be in the
chances of its occurring and the smaller the allowance to
be made for it in the assessment. The second is that as a
matter of the arithmetic of the calculation of present
value, the later the change takes place the less will be its
effect upon the total award of damages. Thus at interest
rates of 4½ per cent the present value of an annuity for
20 years of which the first ten years are at £ 100 per
annum and the second ten years at £ 200 per annum, is
about 12 years' purchase of the arithmetical average
annuity of £ 150 per annum, whereas if the first ten years
are at £ 200 per annum and the second ten years at £ 100
per annum the present value is about 14 years' purchase
of the arithmetical mean of £ 150 per annum. If therefore
the chances of variations in the „dependency‟ are to be
reflected in the multiplicand of which the years' purchase
is the multiplier, variations in the dependency which are
not expected to take place until after ten years should
have only a relatively small effect in increasing or
diminishing the „dependency‟ used for the purpose of
assessing the damages.""
17. The purpose of adopting the multiplier as per the age of the deceased
or as per the age of the Claimant whichever is higher was that if the
Claimant is of much higher age, particularly in case of death of a
bachelor where the mother or for that matter the parents may be
double the age of the deceased, the dependency is to come to an end
in a much lesser period as against the dependency of a widow or
minor children of a deceased. In any case, the deceased was not to
support more than his own life span and thus, by providing the
dependency to the Claimants, it was held that the dependency has to
be as per the age of the deceased or the Claimant whichever is higher.
18. The law laid down in Susamma Thomas (Mrs.) (supra) with regard to
adoption of multiplier method and selection of multiplier according to
the age of the deceased or the Claimant whichever is higher was
affirmed by a three Judge Bench decision in U.P. SRTC v. Trilok
Chandra, (1996) 4 SCC 362. The three Judge Bench laid down that
the multiplier cannot in all cases be solely dependant on the age of the
deceased and the age of the parents would also be relevant in case of
death of a bachelor in the choice of multiplier. In para 18 of the report
of the Supreme Court in Trilok Chandra (supra), it was observed as
under:-
"18....... Besides, the selection of multiplier cannot in all cases
be solely dependant on the age of the deceased. For example, if
the deceased, a bachelor, dies at the age of 45 and his
dependants are his parents, age of the parents would also be
relevant in the choice of the multiplier........."
19. There was some confusion as to the selection of the multiplier because
of the multiplier table as given in the Second Schedule of the Act
under Section 163-A which was inserted w.e.f. 14.11.1994. Some of
the cases had adopted the multiplier as given in the Second Schedule.
Although, the three Judge Bench in Trilok Chandra (supra) had
noticed some clerical mistakes in the multiplier table as given in the
Second Schedule, it stated that the said table can be taken as a guide.
Noticing the wide variations in the selection of multiplier, a two Judge
Bench of the Supreme Court in Sarla Verma (Smt.) & Ors. v. Delhi
Transport Corporation & Anr., (2009) 6 SCC 121 noted the multiplier
as adopted in Susamma Thomas, Trilok Chandra and New India
Assurance Company Limited v. Charlie & Anr. (2005) 10 SCC 720
and in the Second Schedule and in Para 40 of the report, it compared
the same in a tabulated form which is extracted hereunder:-
Age of the Multiplier scale Multiplier Multiplier scale in Multiplier Multiplier actually
dece-ased as envisaged in scale as Trilok Chandra4as specified in used in Second
Susamma adopted by clarified in Charlie Second Column Schedule to the MV
Thomas [(1994) Trilok [(2005) 10 SCC 720 in the Table in Act (as seen from
2 SCC 176 : 1994 Chandra [(199 : 2005 SCC (Cri) Second the quantum of
SCC (Cri) 335] 6) 4 SCC 362] 1657] Schedule to the compensation)
MV Act
(1) (2) (3) (4) (5) (6)
20. The Supreme Court with a view to having a uniform multiplier held
that the multiplier as given in Column (4) of the above table should be
usually followed. In Paras 41 and 42 of the report in Sarla Verma
(Smt.), the Supreme Court observed:-
"41. Tribunals/ courts adopt and apply different operative
multipliers. Some follow the multiplier with reference
to Susamma Thomas [(1994) 2 SCC 176 : 1994 SCC (Cri) 335]
[set out in Column (2) of the table above]; some follow the
multiplier with reference to Trilok Chandra [(1996) 4 SCC
362] , [set out in Column (3) of the table above]; some follow
the multiplier with reference to Charlie [(2005) 10 SCC 720 :
2005 SCC (Cri) 1657] [set out in Column (4) of the table
above]; many follow the multiplier given in the second column
of the table in the Second Schedule of the MV Act [extracted in
Column (5) of the table above]; and some follow the multiplier
actually adopted in the Second Schedule while calculating the
quantum of compensation [set out in Column (6) of the table
above]. For example if the deceased is aged 38 years, the
multiplier would be 12 as per Susamma Thomas [(1994) 2 SCC
176 : 1994 SCC (Cri) 335], 14 as per Trilok Chandra [(1996) 4
SCC 362], 15 as per Charlie [(2005) 10 SCC 720 : 2005 SCC
(Cri) 1657], or 16 as per the multiplier given in Column (2) of
the Second Schedule to the MV Act or 15 as per the multiplier
actually adopted in the Second Schedule to the MV Act. Some
tribunals, as in this case, apply the multiplier of 22 by taking
the balance years of service with reference to the retiring age.
It is necessary to avoid this kind of inconsistency. We are
concerned with cases falling under Section 166 and not under
Section 163-A of the MV Act. In cases falling under Section 166
of the MV Act, Davies method [Davies v. Powell Duffryn
Associated Collieries Ltd., 1942 AC 601 : (1942) 1 All ER 657
(HL)] is applicable.
42. We therefore hold that the multiplier to be used should be
as mentioned in Column (4) of the table above (prepared by
applying Susamma Thomas [(1994) 2 SCC 176 : 1994 SCC
(Cri) 335], Trilok Chandra [(1996) 4 SCC 362] and Charlie
[(2005) 10 SCC 720 : 2005 SCC (Cri) 1657] ), which starts
with an operative multiplier of 18 (for the age groups of 15 to
20 and 21 to 25 years), reduced by one unit for every five years,
that is M-17 for 26 to 30 years, M-16 for 31 to 35 years, M-15
for 36 to 40 years, M-14 for 41 to 45 years, and M-13 for 46 to
50 years, then reduced by two units for every five years, that is,
M-11 for 51 to 55 years, M-9 for 56 to 60 years, M-7 for 61 to
65 years and M-5 for 66 to 70 years."
21. It may be noted that the Supreme Court had gone into the history of
adoption of multiplier method and referred to Nance v. British
Columbia Electric Railway Company Limited, (1951) AC 601 and
Davies v. Powell, (1942) AC 601.
22. Sarla Verma (Smt.) & Ors. v. Delhi Transport Corporation & Anr.,
(2009) 6 SCC 121 related to the death of a Scientist who died leaving
behind his widow, three minor children, parents and grandfather.
Thus, the Supreme Court while laying down that the multiplier has to
be adopted as per Column 4 of the table as per the age of the
deceased, was generally referring to the award of compensation in
cases of death of a person who had a family consisting of widow,
children and parents. Of course, general principles with regard to
award of compensation in case of death of a bachelor were also laid
down by the Supreme Court in Sarla Verma (Smt.), but it was not
specifically laid down that even in the case of death of a bachelor, the
age of the Claimants who may be aged parents will be totally
irrelevant.
23. However, in Amrit Bhanu Shali v. National Insurance Company
Limited, (2012) 11 SCC 738, the Supreme Court stated that the
selection of the multiplier has to be as per the age of the deceased and
not on the basis of the age of the dependants. It was a case which
related to the death of a bachelor.
24. On account of divergence of opinion in the earlier cases, a reference
to a larger Bench was made by a two Judge Bench in Reshma Kumari
v. Madan Mohan & Anr., (2009) 13 SCC 422. The question of award
of compensation in relation to multiplier and future prospects was
gone into at great length by a three Judge Bench of the Supreme Court
in Reshma Kumari & Ors. v. Madan Mohan & Anr., (2013) 9 SCC 65.
The two referred questions by Reshma Kumari v. Madan Mohan &
Anr., (2009) 13 SCC 422 were:-
"1.1. Whether the multiplier specified in the Second Schedule
appended to the Motor Vehicles Act, 1988 (for short "the 1988
Act") should be scrupulously applied in all cases" and
1.2. Whether for determination of the multiplicand, the
1988 Act provides for any criterion, particularly as regards
determination of future prospects?"
25. While answering the points, in Para 43, the Supreme Court observed
as under:-
"43. In what we have discussed above, we sum up our
conclusions as follows:
43.1. In the applications for compensation made under Section
166 of the 1988 Act in death cases where the age of the
deceased is 15 years and above.
43.2. In cases where the age of the deceased is up to 15 years.
43.3. As a result of the above, while considering the claim
applications made under Section 166 in death cases where the
age of the deceased is above 15 years, there is no necessity for
the Claims Tribunals to seek guidance or for placing reliance
on the Second Schedule in the 1988 Act.
43.4. The Claims Tribunals shall follow the steps and
guidelines stated in para 19 of Sarla Verma v. DTC, (2009) 6
SCC 121 for determination of compensation in cases of
death....."
26. In Reshma Kumari & Ors. v. Madan Mohan & Anr., (2013) 9 SCC 65,
these were general observations that the steps and guidelines stated in
para 19 of Sarla Verma (Smt.) have to be followed. In Sarla Verma
(Smt.), it was laid down that having regard to the age of the deceased
and period of active career, the active multiplier should be selected
and the multiplier should be chosen from the table with reference to
the age of the deceased. As I have observed above, it was not the
intention in Sarla Verma (Smt.) to apply the multiplier of 18 in case of
death of a bachelor aged 25 years where the dependants may only be
the aged parents. Thus, in Reshma Kumari also, it was not laid down
that the multiplier has to be according to the age of the deceased even
when the deceased is a bachelor having dependency of the parents
only.
27. Of course, in M. Mansoor & Anr. v. United India Insurance Company
Limited & Anr., (2013) 15 SCC 603, the two Judge Bench observed
that the multiplier has to be as per the age of the deceased and even in
case of death of a bachelor aged 24 years, the multiplier will be 18.
28. However, there is a three Judge Bench decision of the Supreme Court
in New India Assurance Company Limited v. Shanti Pathak (Smt.) &
Ors., (2007) 10 SCC 1 wherein a bachelor aged 25 years lost his life
in a motor vehicular accident which occurred on 11.11.2002. The
Claims Tribunal adopted a multiplier of 17, as per the age of the
deceased (25 years). On appeal filed by the New India Assurance
Company Limited before the High Court, it was contented that the
multiplier has to be as per the age of the Claimants (in that case) and
not as per the age of the deceased. The Division Bench of High Court
of Uttarakhand declined to accept the contention and dismissed the
appeal. In the SLP filed by the Insurance Company, the multiplier of
17 was reduced to '5' on the age of the mother of the deceased being
65 years.
29. Also, in the latest judgment of the Supreme Court in Ashvinbhai
Jayantilal Modi v. Ramkaran Ramchandra Sharma & Anr., (2015)2
SCC 180, a two Judge Bench of the Supreme Court dealt with the
questions of multiplier and the appropriate multiplier in case of death
of a bachelor in the said case was taken as 13, keeping in mind the age
of the parents of the deceased. Para 11 of the report is extracted
hereunder:-
"11. The deceased was a diligent and outstanding student of
medicine who could have pursued his MD after his graduation
and reached greater heights. Today, medical practice is one of
the most sought after and rewarding professions. With the
tremendous increase in demand for medical professionals, their
salaries are also on the rise. Therefore, we have no doubt in
ascertaining the future income of the deceased at Rs 25,000
p.m. i.e. Rs 3,00,000 p.a. Further, deducting 1/3rd of the annual
income towards personal expenses as per Oriental Insurance
Co. Ltd. v. Deo Patodi [(2009) 13 SCC 123 : (2009) 5 SCC
(Civ) 29 : (2010) 1 SCC (Cri) 963] and applying the
appropriate multiplier of 13, keeping in mind the age of the
parents of the deceased, as per the guidelines laid down
in Sarla Verma case [Sarla Verma v. DTC, (2009) 6 SCC 121 :
(2009) 2 SCC (Civ) 770 : (2009) 2 SCC (Cri) 1002], we arrive
at a total loss of dependency at Rs 26,00,000 [(Rs 3,00,000
minus 1/3 × Rs 3,00,000) × 13]......."
30. Thus, right from the two Judge Bench decision in General Manager,
Kerala State Road Transport Corporation, Trivandrum v. Susamma
Thomas (Mrs.) and Ors., (1994) 2 SCC 176, which for the first time
held that the multiplier method is the best way of awarding just
compensation, which was approved in U.P. SRTC v. Trilok Chandara,
(1996) 4 SCC 362, wherein it was held that the multiplier has to be as
per the age of the deceased or the Claimant whichever is higher,
which is reiterated in New India Assurance Company Limited v.
Shanti Pathak (Smt.) & Ors., (2007) 10 SCC 1 by applying the
multiplier as per the age of the mother of the deceased (bachelor), the
consensus of the larger Bench decisions seems to be that the
multiplier has to be selected as per the age of the deceased or the
Claimant whichever is higher. The judgment in Vijay Laxmi & Anr. v.
Binod Kumar Yadav & Ors., ILR (2012) 6 DEL 447 has thus,
correctly interpreted the law. Three Judge Bench decision in U.P.
SRTC v. Trilok Chandara, (1996) 4 SCC 362 shall be taken as a
binding precedent in the matter of selection of multiplier as per the
age of the deceased or the Claimants.
31. Moreover, even if there is divergence of opinion in subsequent two
Judge Bench decisions or three Judge Bench decisions (although there
is no divergence by three Judge Bench decisions), the law laid down
by three Judge Bench in Trilok Chandra (supra) shall be taken as a
binding precedent. In this connection, a reference may be made to
Central Board of Dawoodi Bohra Community and Anr. v. State of
Maharashtra & Anr., (2005) 2 SCC 673, wherein, in para 12, the
Supreme Court observed as under:-
"12. Having carefully considered the submissions made by
the learned Senior Counsel for the parties and having examined
the law laid down by the Constitution Benches in the abovesaid
decisions, we would like to sum up the legal position in the
following terms:
(1) The law laid down by this Court in a decision delivered by a
Bench of larger strength is binding on any subsequent Bench of
lesser or coequal strength.
(2) A Bench of lesser quorum cannot disagree or dissent from
the view of the law taken by a Bench of larger quorum. In case
of doubt all that the Bench of lesser quorum can do is to invite
the attention of the Chief Justice and request for the matter
being placed for hearing before a Bench of larger quorum than
the Bench whose decision has come up for consideration. It will
be open only for a Bench of coequal strength to express an
opinion doubting the correctness of the view taken by the
earlier Bench of coequal strength, whereupon the matter may
be placed for hearing before a Bench consisting of a quorum
larger than the one which pronounced the decision laying down
the law the correctness of which is doubted.
(3) The above rules are subject to two exceptions: (i) the
abovesaid rules do not bind the discretion of the Chief Justice
in whom vests the power of framing the roster and who can
direct any particular matter to be placed for hearing before any
particular Bench of any strength; and (ii) in spite of the rules
laid down hereinabove, if the matter has already come up for
hearing before a Bench of larger quorum and that Bench itself
feels that the view of the law taken by a Bench of lesser
quorum, which view is in doubt, needs correction or
reconsideration then by way of exception (and not as a rule)
and for reasons given by it, it may proceed to hear the case and
examine the correctness of the previous decision in question
dispensing with the need of a specific reference or the order of
the Chief Justice constituting the Bench and such listing. Such
was the situation in Raghubir Singh [(1989) 2 SCC 754] and
Hansoli Devi [(2002) 7 SCC 273]."
32. Similarly, in Safiya Bee v. Mohd. Vajahath Hussain @ Fasi, (2011) 2
SCC 94, in para 27, the Supreme Court observed as under:-
"27. However, even assuming that the decision in WP No.
35561 of 1998 did not operate as res judicata, we are
constrained to observe that even if the learned Judges who
decided WP No. 304 of 2001 did not agree with the view taken
by a coordinate Bench of equal strength in the earlier WP No.
35561 of 1998 regarding the interpretation of Section 2 (c) of
the Act and its application to the petition schedule property,
judicial discipline and practice required them to refer the issue
to a larger Bench. The learned Judges were not right in
overruling the statement of the law by a coordinate Bench of
equal strength. It is an accepted rule or principle that the
statement of the law by a Bench is considered binding on a
Bench of the same or lesser number of Judges. In case of doubt
or disagreement about the decision of the earlier Bench, the
well-accepted and desirable practice is that the later Bench
would refer the case to a larger Bench."
33. Also, in Union of India and Ors. v. S.K. Kapoor, (2011) 4 SCC 589,
while holding that the decision of the Co-ordinate Bench is binding on
the subsequent Bench of equal strength, it was held that the Bench of
Co-ordinate strength can only make a reference to a larger Bench. In
para 9 of the report, the Supreme Court held as under:-
"9. It may be noted that the decision in S.N. Narula
case [(2011) 4 SCC 591] was prior to the decision in T.V. Patel
case [(2007) 4 SCC 785 : (2007) 2 SCC (L&S) 98]. It is well
settled that if a subsequent coordinate Bench of equal strength
wants to take a different view, it can only refer the matter to a
larger Bench, otherwise the prior decision of a coordinate
Bench is binding on the subsequent Bench of equal strength.
Since, the decision in S.N. Narula case [(2011) 4 SCC 591] was
not noticed in T.V. Patel case [(2007) 4 SCC 785 : (2007) 2
SCC (L&S) 98] , the latter decision is a judgment per incuriam.
The decision in S.N. Narula case [(2011) 4 SCC 591] was
binding on the subsequent Bench of equal strength and hence, it
could not take a contrary view, as is settled by a series of
judgments of this Court."
34. Thus, in view of this, the three Judge Bench decision in Trilok
Chandra (supra), later reiterated in the three Judge Bench decision of
New India Assurance Co. Ltd. v. Shanti Pathak (supra) shall be taken as
a binding precedent. The multiplier will be as per the age of the
deceased or the Claimant whichever is higher.
35. In the instant case, the dependants are the mother of the deceased and
the younger sibling, sister of the deceased. Respondent No. 2,
although major was still dependant upon the deceased till she settled
in life. In fact, the deceased was himself just 23 years old at the time
of his death. In view of this, the deduction towards personal and living
expenses ought to have been 1/3 as against 1/2 taken by the Claims
Tribunal. But at the same time, the multiplier will be as per the age of
the mother of the deceased as the sister was to settle in a couple of
years.
36. Learned counsel for Respondents No. 1 and 2 has produced High
School Certificate of Munni Kandpal, which states the date of birth of
Respondent No. 1 as 10.06.1960. The age of the mother of the
deceased, therefore, comes to about 52 years at the time of the death.
This is also corroborated from the ration card which has been placed
on record.
37. In the monthly salary of ` 17,500/-, there was payment of ` 2,000/-
towards HRA. HRA being tax free, there was no liability of income
tax.
38. The loss of dependency will therefore, come to ` 15,40,000/-
(`17,500/- x 12 x 2/3 x 11).
39. In addition, Respondents No. 1 and 2 are entitled to a sum of
`1,00,000/- towards loss of love and affection, `25,000/- towards
funeral expenses and `10,000/- towards loss to estate in view of the
three Judge Bench decision of the Supreme Court in Rajesh and Ors.
v. Rajbir Singh & Ors., (2013) 9 SCC 54.
40. The overall compensation thus, comes to `16,75,000/-.
41. The excess compensation of `12,95,000/- along with interest shall be
refunded to the Appellant Insurance Company.
42. Statutory amount, if any, deposited shall also be refunded to the
Appellant Insurance Company.
43. Pending applications, if any, also stand disposed of.
(G.P. MITTAL)
JUDGE
MARCH 20, 2015
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