Jharkhand High Court
Vinod Swarnkar vs Dayanand Modi on 19 January, 2021
IN THE HIGH COURT OF JHARKHAND AT RANCHI
(Civil Miscellaneous Appellate Jurisdiction)
M.A. No. 168 of 2014
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1. Vinod Swarnkar
2. Smt. Poonam Devi ...... Appellants
Versus
1. Dayanand Modi
2. IIiyas Ansari
3. Bajaj Allianz General Insurance Co. Ltd. ......Respondents
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CORAM: HON'BLE MR. JUSTICE KAILASH PRASAD DEO
(Through :-Video Conferencing)
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For the Appellants : Mr. Arvind Kr. Lall, Advocate
For the Respondent no.3 : Mr. S.J. Roy, Advocate
......
09/Dated: 19/01/2021.
Heard, learned counsel for the parties.
Claimants namely, Vinod Swarnkar and Smt. Poonam Devi are the appellants
before this Court, who lost their minor child, Rishu Kumari aged about 6 years in
an unfortunate accident which took place on 10.03.2010 at about 11 A.M when
she was coming to home from the school and while she reached in front of her
house, a Bolero Jeep bearing registration No.JH-11D-8550 insured before the
Bajaj Allianz General Insurance Co. Ltd. which was coming from Dhanwar Bazar
knocked her down from the reverse side as a result of which Rishu Kumari died
on spot.
Learned counsel for the appellants has assailed the impugned award on the
grounds that the learned Tribunal has paid less amount to the claimants. As per
schedule-II of the MV Act, less multiplier has been given for the deceased less
than 15 years of age. The learned Tribunal has considered the age of the victim on
the alleged date of occurrence to be six years and Rs.15,000/- notional income
has been considered, but no amount has been paid under the loss of consortium
and only Rs.15,000/- has been paid under love and affection and no future
prospect has been given though the Apex Court in the case of Kirti & Anr. Etc.
vs. Oriental Insurance Company Ltd. passed in Civil Appeal Nos.19-20 of 2021
allowed future prospect to all the persons vide judgment dated 05.01.2021, as
such, this Court may enhance the compensation.
Learned counsel for the appellants has submitted that price index for the year
2009 to 2010 was 632 and the date of occurrence is 10.03.2010, as such, amount
may be enhanced.
Learned counsel for the appellants has relied upon the judgment passed by the
this Court in the case of Mina Devi vs. Arbinda Das and ors. dated 06.12.2019
passed in MA. No.461 of 2019 and Santosh Yadav and Anr. vs. Baldeo Sao and
Ors. on 16.12.2019 passed in M.A. No.48 of 2017 and has submitted that this
Court has granted compensation in such cases where the deceased was minor
aged about 6 years and 10 years respectively to the tune of Rs.3,75,000/- along
with interest @ 7.5% from the date of institution of the claim application, as such,
this Court may consider the same.
Learned counsel for the respondent no.3, Mr. S.J. Roy has submitted that this
Court has passed an order relying upon the judgment passed by the Delhi High
Court in the case of Chetan Malhotra Vs. Lala Ram 2016 SCC Online Del 2981
as well as the Apex Court in the case of Kishan Gopal & Anr. vs. Lala & Ors.,
reported in 2014 (1) SCC 244, State of Haryana v. Jasbir Kaur, (2003) 7 SCC
484 and also the judgment of New India Assurance Co. Ltd. vs. Satender and
others (2006) 13 SCC 60 and granted compensation to the tune of Rs.3,75,000/-
along with interest @ 7.5% from the date of institution till the date of
indemnifying the award, but in the present case since the occurrence is of the
year, 2010, which was adjudicated in the year 2014, considering it to be just and
fair compensation the same was indemnified and thereafter Miscellaneous Appeal
has been preferred before this Court, as such, this Court may not interfere by
enhancing the amount as the compensation granted to the claimants for death of
their daughter aged about 6 years is fair and just compensation, as such, this
Court may dismiss the appeal.
After hearing, learned counsel for the parties and looking into the facts and
circumstances of the case, it appears that Motor Vehicle Act, 1988 has not taken
notice of such eventuality when the deceased will be less than 15 years. There is
no straitjacket formula appended with the Motor Vehicle Act and this Court has
considered the case of Chetan Malhotra (supra) and has taken note of the cost
inflation index in paras 65, 66, 67, 68, 69, 70 and 71 which are profitably quoted
hereunder:
"65. Having regard to the fluctuating trends in CPI (IW), this court finds the
Cost Inflation Index (CII) determined and notified by the Ministry of Finance in
Government of India under Section 48 of Income Tax Act, 1961 for each
financial year, to be a better method to off-set the effect of inflation on the real
value of money. This approach, if followed, would ensure that there is no
inconsistency in the awards of compensation in cases of death of children. [R.K.
Malik (supra) and Balram Prasad v. Kumar Saha (2014) 1 SCC 384]. Since the
amount which requires to be subjected to correction was determined by decision
in R.K. Malik wherein cause of action had arisen on 10.11.1997, the financial
year 1997-98 is taken as the "base year".
66. For ready reference, the rates of Cost Inflation Index (CII) notified by the
government till date, to the extent necessary, are reproduced in the table given
below:
Financial CII
Year
1/4/1981
xxx xxx
2014-15 1024
2015-16 1081
CONCLUSIONS
67. In the considered view of this Court, the cases for compensation on account
of death of children in motor vehicular accident cases ought to be dealt with by
considering the claim towards pecuniary damages (towards loss to estate), in
accordance with the age-group wise categories as in R.K. Malik (supra); the
first category being of children less than 10 years' in age, the second category
being of children more than 10 years' and up to 15 years' in age, and the third
category 3 of children more than 15 years' but not having attained the age of
majority (18 years). The children in the third category would ordinarily be of
such age group as is generally receiving formal school education or those that
are (being) imparted special training so as to be equipped with requisite skills
to be gainfully employed in a variety of trades. They are after all nearing
adulthood and thus, on the threshold of becoming self-reliant. In such cases, the
prospects of their employability and earnings in future or present, based on
evidence adduced about their academic track record or training in special
talents or skills, would need to be borne in mind. As in Lata Wadhwa (supra),
the claim for pecuniary damages arising out of death of children of this age
group cannot be at par with the lower age groups falling in the first and second
category. Therefore, the pecuniary loss to estate due to their death would
deserve to be worked out by applying a higher multiplier on the notional income
(of nonearning persons) unless, of course, case is properly made out for higher
considerations. Noticeably, in Sarla Verma (supra) the Supreme Court specified
the multiplier of 18 for cases where the deceased was in the age-group of 15
years' to 20 years' old. For the first and second category, however, the
multiplier of 10 and 15 respectively, as used in R.K. Malik (supra), would hold
good.
68. Since in the claims arising out of death of children, generally speaking,
(nonearning hands), the income is to be notionally assumed on the basis of the
second schedule to the MV Act, the general practice of deduction of one-half
(50%) towards personal & living expenses, as applied in case of bachelors
above the age of 18 years would be unfair. Pertinently, the notional income
specified for non-earning persons in the second schedule is very low as
compared to the rates of minimum wages. Therefore, the deduction of one-third
(1/3rd) on this account, as provided by the first note below the second schedule
would only be appropriate.
69. The award of compensation must necessarily take into account
nonpecuniary damages. In R.K. Malik (supra), Rs. 75,000/- awarded by this
Court as the "conventional compensation" was enhanced by the Supreme Court
by further similar amount (Rs. 75,000/-) as the "compensation for future
prospects". For the reasons set out earlier, in the context of pecuniary loss to
estate, the composite sum of non-pecuniary damages of Rs. 1,50,000/- [as
awarded in R.K. Malik (supra)] would deservedly be added, but with suitable
correction so as to ensure that the deficiency in the real value of money is made
good. As noted (in para 46) earlier, the Supreme Court justified the addition of
Rs. 75,000/- towards compensation for "future prospects" by noting that the
said amount was "roughly half of the amount given on account of pecuniary
damages". Since the court had also upheld the award of similar sum (Rs.
75,000/-) by this court as "conventional compensation", both amounts of
nonpecuniary damages, put together, account for roughly an amount equivalent
to the sum computed as pecuniary loss to estate. Thus, this court is of the view
that a composite sum equal to the amount computed as pecuniary loss to estate
may be added as non-pecuniary damages (inclusive of conventional
compensation and for future prospects), in such cases as at hand to arrive at the
appropriate figure of 'just compensation'.
70. It has been noticed by this Court that the tribunals have been assessing the
compensation and awarding it to the last rupee, at times even in the fraction of
a rupee, not bothering to follow the practice of rounding off. Awards in at least
two of the cases from which the appeals at hand arise provide ready illustration.
This seems to be not correct. It must be added here that human misery cannot
be calculated with such mathematical precision. Even otherwise for
convenience of accounting, it is desirable that the amount of award is rounded
off to the nearest (if not next) thousands of rupees.
71. Subject to all other requisite conditions being fulfilled, for the foregoing
reasons, in order to bring about consistency and uniformity in approach to the
issue, it is held that claims for compensation on account of death of children
shall be determined as follows:
(i). Till such time as the law is amended by the legislature, or the Central
Government notifies the amendment to the Second Schedule in exercise of the
enabling power vested in it by Section 163-A (3) of the Motor Vehicles Act,
1988, and except in cases wherein the prospects of employability and earnings
(in future or present) of the deceased child are proved by cogent and irrefutable
evidence, this having regard, inter alia, to the academic record or training in
special talents or skills, for computing the pecuniary damages on account of the
loss to estate, the notional income of nonearning persons (Rs.15000/- p.a.) as
specified in the Second Schedule (brought in force from 14.11.1994), shall be
assumed to be the income of the deceased child, and taken into account after it
is inflation-corrected with the help of Cost Inflation Index (CII) as notified by
the Government of India from year to year under Section 48 of the Income Tax
Act, 1961, by applying the formula indicated hereinafter.
(ii) For inflation-correction, the financial year of 1997-1998 shall be treated as
the "base year" and the value of the notional income relevant to the date of
cause of action shall be computed in the following manner:-
Rs. 15,000/- × A ÷331
[wherein the figure of 'Rs. 15,000/-' represents the notional income specified in
the second schedule requiring inflation-correction; 'A' represents the CII for the
financial year in which the cause of action arose (i.e. the accident/death
occurred); and the figure of '331' represents the CII for the 'base year']
(iii). After arriving at an appropriate figure of the present equivalent value of
the notional income (i.e. inflation-corrected amount), it shall be rounded off to a
figure in next thousands of rupees.
(iv). The amount of notional income thus calculated shall be reduced to
twothird, the deduction to the extent of one-third being towards personal &
living expenses of the deceased, the balance taken as the annual loss to estate
(hereinafter also referred to as "the multiplicand")
(v) For assessment of the pecuniary damages on account of the death of
children upto the age of 10 years, the loss to estate shall be calculated,
capitalizing the multiplicand, by applying the multiplier of ten (10)
(vi) For children of the age-group of more than 10 years upto 15 years, the loss
to estate shall be calculated by applying the multiplier of fifteen (15).
(vii). For children of the age-group of more than 15 years but less than 18
years, the loss to estate shall be calculated by applying the multiplier of
eighteen (18).
(viii). After the pecuniary loss to estate has been worked out in the manner
indicated above, an amount equivalent to the amount thus computed shall be
added to it as the composite non-pecuniary damages taking care of not only the
conventional heads but also towards future prospects as awarded in R.K. Malik
v. Kiran Pal (2009) 14 SCC 1.
(ix). The final sum thus arrived at, appropriately rounded off, if so required to
the nearest (if not next) thousands of rupees, shall be awarded as compensation
for the death of the child."
Under the aforesaid circumstances, considering the cost inflation index for the
year 2009-2010 as 632, divided by the cost inflation index of base year i.e. 1997-
1998 as 331 and the said chart of the cost inflation index notified by the
Government up to the year, 2015-2016 is 1081 and for the year, 2016-2017 is
1125. Unfortunate accident took place on 10.03.2010 and considering the
notional income of the deceased to be Rs.15,000/-, the calculation is will be as
Rs.15,000 x A ÷ by 331 i.e. 15,000 x 632 of cost inflation index divided by 331,
then Gross income comes to Rs.28,640.48/- which is rounded off as Rs.29,000/-.
After deducting 1/3rd of Rs.29,000/- and applying the multiplier of 15, the
pecuniary loss to estate is computed as (Rs.29,000 x 2/3 x 15 = Rs.2,30,000/-).
Adding a similar account towards composite non-pecuniary damages, the total
compensation work out to Rs.3,00,000/-, though the same is considered to
Rs.3,75,000/- in view of the judgment passed in the case of National Insurance
Company Ltd. Vs. Farzana 2009 ACJ 2763. In any cause of action arising on or
after dated 10.05.2000, the amount of compensation shall not in any case be less
than Rs.3,75,000/- as it has been awarded in the case of Farzana (Supra).
Further in the case of Sayed Mohamad vs. The New India Insurance Co.
Ltd. reported in 2011 (11) SCC 625, Hon'ble Apex Court has held at para 13 that
the Motor Vehicle Act, 1988 is a beneficial legislation intended to place the
claimant in the same position that he was before the accident and to compensate
him for his loss thus it should be interpreted liberally so as to achieve the
maximum benefit, which is para 13 is profitable quoted herein:-
13. The Motor Vehicles Act of 1988 is a beneficent legislation intended to place
the claimant in the same position that he was before the accident and to
compensate him for his loss. Thus, it should be interpreted liberally so as to
achieve the maximum benefit.
Since there is no Schedule, as such, considering the compensation as
considered in the case of deceased having age of 15 years under different
categories cannot be equated in the present case, individually for deduction as
personal and living expenses in view of the judgment passed by the Apex Court
in the case of Sarla Verma (Smt) & others vs. Delhi Transport Corporation &
another, reported in (2009) 6 SCC 121 and with regard to future prospect in view
of the judgment passed by the Apex Court in the case of Kirti (Supra) and in
view of the judgment passed by the Apex Court in the case of National
Insurance Company Ltd. vs. Pranay Sethi, reported in (2017) 16 SCC 680.
Under the aforesaid circumstances, this Court is of the view that the
compensation cannot be a windfall gain or a bonanza, but on the other hand, it
should not be pittance, as such, in view of the above discussion, this Court directs
the Insurance Company to pay a sum of Rs.3,75,000/- along with interest @ 7.5%
from the date of institution of the case in view of the judgment passed by the
Apex Court in the case of Dharmpal and Sons vs. U.P. State Road Transport
Corporation (2008 (4) JCR 79 (SC).
The amount already paid, if any, by the Insurance Company shall be deducted
from the aforesaid amount and the balance amount of the same shall carry interest
from the date of institution of the claim application.
Accordingly, the instant Miscellaneous Appeal is hereby allowed with
aforesaid modification.
(Kailash Prasad Deo, J.)
sandeep/R.S.
