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Judgment
L. Narasimha Reddy, J.—One Swayam Prakash was employed as a Chainman in Hyderabad Urban Development Authority. On 11.6.1996 when he was proceeding to office along with one Ramachandra Raju on a motor cycle bearing No. AIX 4373, near E.S.I. Hospital, Hyderabad, at about 2.45 p.m., a bus bearing No. AP 9-Z 5672, owned by the appellant Corporation dashed against the motor cycle. Even while Swayam Prakash was being taken to Gandhi Hospital, Secunderabad, for treatment, he died. Crime No. 283 of 1996 u/s 304-A, Indian Penal Code was registered against the driver of the bus. The wife, respondent No. 1; children, respondent Nos. 2 to 5 and mother, respondent No. 6, of the deceased filed O.P. No. 1052 of 1996 before the Motor Accidents Claims Tribunal-cum-Fifth Additional Chief Judge, City Civil Court, Hyderabad claiming a sum of Rs. 4,00,000 as compensation. The O.P. was opposed by the appellant on several grounds. Through its order dated 25.1.1999 the Tribunal awarded the claimed amount together with interest at the rate of 12 per cent per annum. The same is challenged in this civil miscellaneous appeal.
Mr. V.T.M. Prasad, the learned Counsel for the appellant Corporation submits that when the O.P. itself was filed u/s 166 of the Motor Vehicles Act, 1988 (for short ''the Act''), there was no justification for the Tribunal in applying the multiplier stipulated in Second Schedule to the Act which becomes relevant only when the O.P. is filed u/s 163-A of the Act. He further contends that the Tribunal had taken the gross salary of the deceased as the basis instead of taking the net salary. Learned Counsel submits that the rate of interest awarded by the Claims Tribunal is excessive.
Mr. Vijaya Kumar, the learned Counsel for the respondents, on the other hand, submits that the claim made by his clients fits into Section 163-A as well as Section 166 of the Act and the mere fact that they have proved negligence of the driver of the bus must not entail in reduction of the compensation. He further contends that the future prospects of the deceased were not taken into account and in that view of the matter, the Tribunal was justified in taking the gross salary as the basis.
The finding recorded by the Tribunal that the accident occurred on account of rash and negligent driving on the part of the driver of the bus, is not seriously challenged. Having regard to the evidence of the eyewitness, PW 2; the first information report, Exh. A1 and the charge-sheet, Exh. A2, it can safely be held that driver of the bus alone was responsible for the accident.
It is urged that the deceased was employed in the Hyderabad Urban Development Authority and his salary certificate was filed as Exh. A7. According to that the deceased was being paid the monthly salary of Rs. 3,092. It is not clear as to whether the said amount represents the net or gross salary. Even assuming that the net salary would be somewhat less than this, it must be noted that the future prospects of promotions and increments of the deceased must be taken into account while determining the loss of dependency. The Tribunal did not address itself to this question. The probable increase in the emoluments, on account of promotions and increments, can be said to have been taken care of by adopting the salary as it is, without any deductions, to become the net salary.
The Tribunal adopted the multiplier indicated in Second Schedule to the Act, on the basis of the age of the deceased at 38 years. The objection raised on behalf of the appellant Corporation is that when the compensation is claimed u/s 166 of the Act, the multiplier contained in Second Schedule to the Act, which applies only to claims u/s 163-A of the Act, cannot be adopted. Though there is some force in this plea, it can be accepted only subject to certain conditions.
Section 163-A together with Second Schedule to the Act provides for a structured formula. In a claim made under this provision, the claimants shall not be under obligation to prove negligence on the part of the driver. However, it is restricted to such cases, where the annual income of the deceased or the injured does not exceed Rs. 40,000. Even where income is more, it has to be restricted to that amount.
There may be cases, where the facts pleaded and proved by the parties may fit into a claim u/s 163-A read with Second Schedule to the Act as well as the one u/s 166 of the Act, to which the restrictions and ceiling as to annual income do not apply. In such cases, if the annual income of the deceased or the injured does not exceed Rs. 40,000, there is no reason why Second Schedule to the Act cannot be applied. In fact, there does not exist any contradiction in terms.
In the instant case, the annual income of the deceased was arrived at Rs. 37,104 and after deduction of 1/3rd for his personal expenditure, the annual contribution to the family was found to be at Rs. 24,736. Both the figures are within the limits contained in Second Schedule to the Act. The mere fact that the respondents have proved the liability of the driver of the bus for the accident, cannot disentitle them from availing the benefit under Second Schedule to the Act, in the matter of selection of multiplier. The necessity to apply the multiplier as indicated in the judgment of this court in Bhagwandas Vs. Mohd. Arif, , would arise only when annual income of the deceased or injured exceeds Rs. 40,000, before deduction of 1/3rd. The Tribunal has selected the multiplier and adopted all other figures, such as the one for loss of consortium, loss to estate, funeral expenses, etc., from Second Schedule to the Act. This court does not find any basis to interfere with the same.
So are as the rate of interest is concerned, the Apex Court and this court have uniformily awarded the same at 7.5 per cent, in the claims of this nature, whereas the Tribunal awarded at 12 per cent. Therefore, the same is required to be slashed down to 7.5 per cent.
Hence, the civil miscellaneous appeal is allowed in part, reducing the rate of interest from 12 per cent to 7.5 per cent, but upholding the order passed by the Tribunal in other respects. There shall be no order as to costs.