Andhra Pradesh State Road Transport Corporation vs Divakala Vasundara and Others

L. Narasimha Reddy, J.—Sri Divakala Venkata Raghava Rao, husband of the 1st respondent and father of respondents 2 and 3, was employed as Senior Assistant in the office of Padmanabham Mandal Parishad, East Godavari District. On 6.9.2000, he was proceeding to the Sub-Treasury Office at Bheemunipatnam, from his house, at 10 A.M. On the way, he was hit by a bus bearing No. AP-9Z-6035, belonging to the appellant, and driven by the 4th respondent. Immediately he was shifted to the nearby hospital, but was declared dead. A case u/s 304A of IPC was registered against the 4th respondent, in the concerned police station. Respondents 1 to 3 (for short "the respondents") filed MVOP No. 1717 of 2000, in the Motor Accidents Claims Tribunal-cum- II Additional District Judge, Visakhapatnam, claiming a sum of Rs. 8,70,000/- as compensation. They pleaded that the deceased was earning a salary of Rs. 9,426/- , per month, and that he was aged 54 years, by the time he died.

The 4th respondent remained ex parte. The matter was contested by the appellant alone. It put the respondents to strict proof of the facts pleaded by them. The allegation as to the rashness and negligence, on the part of the driver, was denied. It was pleaded that, when the bus was negotiating a curve at Government Hospital, an auto rikshaw with number of passengers in it, came in a rash and negligent manner, and to avoid the same, the bus was swerved to the left, and in the process, the deceased died. Through order, dated 27.6.2002, the Tribunal awarded the compensation as claimed by the respondents, with interest at 9%, and apportioned the same among them. This appeal is directed against the said order.

Smt. B.G. Umadevi, learned Counsel for the appellant, submits that the Tribunal committed a serious error, in adopting the multiplier ''11'', though the deceased was found to be of the age of 54 years. She contends that the Tribunal was not justified in selecting the multiplier from Schedule-II, for short "the Schedule, of the Motor Vehicles Act, (for short "the Act"), when the annual income of the deceased exceeded Rs. 40,000/-. She contends that the Tribunal had departed in all other respects from the Schedule, but relied upon it, only for the purpose of multiplier. She also takes exception to the rate at which the interest was granted.

Sri K.L.N. Rao, learned Counsel for the respondents, on the other hand, submits that the application of the Schedule is not restricted to any particular category of cases. He contends that when the formula contained in the schedule can be applied to the cases, where the claimants do not have to prove the negligence, there is no reason why it cannot be applied to cases, in which the negligence of the driver is proved. Placing reliance upon certain decided cases, he contends that the award passed by the Tribunal does not warrant interference.

On behalf of respondents, PWs.1 to 3 were examined, and Exs.A-1 to A-5 were marked. RW-1 was examined on behalf of the appellant, and Ex.X-1, true copy of the Service Book of the deceased, was also taken on record.

The occurrence of the accident and the death of the deceased, on account of the rashness and negligence on the part of the 4th respondent, are not seriously, at issue. The FIR, the report of the Motor Vehicle''s Inspector, the Post-mortem certificate and Charge Sheet were filed as Exs.A-1 to A-4. Though the learned Counsel for the appellant made an attempt to convince this court that there was no negligence on the part of the driver, the plea cannot be accepted, in view of the clinching evidence on record.

The serious controversy in this appeal is about the quantum of compensation awarded by the Tribunal. The accident occurred on 6.9.2000. The date of birth of the deceased was found to be 22.9.1945, and his age, as on the date of accident, crossed 55 years. In the ordinary course, he was due to retire from service, on 30.9.2003.

There did not exist much controversy, as to the income of the deceased. Ex.A-5 is the Salary certificate, issued by the Superintendent of Padmanabham Mandal Parishad, and he was examined as PW.3. According to this, the salary of the deceased was Rs. 9,426/- per month. The Tribunal rounded the same to Rs. 9,500/-. The contribution to the family was taken at Rs. 6,334/-, after deducting 1/3rd, towards the personal expenses of the deceased. This exercise also accords with the settled principles.

The Tribunal had chosen the multiplier ''11'', obviously from Schedule II. A perusal of Schedule II of the Act discloses that it contains facts and figures relatable to the maximum income of Rs. 40,000/-. It does not contain any indication that it can be operated in cases, where the annual income exceeds Rs. 40,000/-. This schedule is almost, part of Section 163A of the Act, which provides for a structured formula of determination of compensation, without requiring the claimant to prove the negligence on the part of the driver of the vehicle. Since the claimants are relieved of the obligation vis-vis of substantial aspect, the formula is also restricted to certain situations. For example, the amount to be awarded towards loss of consortium, in the ordinary situations, depends on the age of the claimant, and that of the spouse, who died in an accident. However, under the formula, the amount to be awarded towards loss of consortium is restricted to Rs. 5,000/-. Similarly, loss of estate, which depends upon the capability of the deceased to earn, is restricted to Rs. 2,000/- under the Schedule.

Learned Counsel for the respondents relied upon certain precedents, to satisfy this court that the indices in the Schedule to the Act can be taken into account, even while adjudicating the claims u/s 166 of the Act. Before adverting to the said judgments, it is necessary to note that, if the annual income of the deceased is found to be less than Rs. 40,000/-, the Schedule can be taken assistance of, whether the claim is u/s 163A or 166 of the Act. The reason is that if the formula therein can be availed u/s 163A by the claimants, without the necessity of proving the negligence on the part of the driver, the mere fact that the negligence is proved in a claim u/s 166 of the Act, does not disentitle the claimants, to rely upon it. The whole controversy is as to whether it can be pressed into service, where the annual income of the deceased exceeds Rs. 40,000/-.

In Abati Bezbaruah Vs. Dy. Director General Geological Survey of India and Another, , the Supreme Court held as under:

It is now well settled principle of law that the payment of compensation on the basis of structured formula as provided for under the Second Schedule should not ordinarily be deviated from. Section 168 of the Motor Vehicles Act lays down the guidelines for determination of the amount of compensation in terms of Section 166 thereof. Deviation of the structured formula, however, as has been held by this court, may be resorted to in exceptional cases. Furthermore, the amount of compensation should be just and fair in the facts and circumstances of each case.

From this, it is difficult to infer that the Schedule can be relied upon, irrespective of the income of the deceased. In Managing Director, Tnstc Ltd. v. K.I. Bindu and Ors. 2006(1) ALT 11 (SC ), it was observed that the highest multiplier is ''13'' for the persons of age group of 21-25 years, and for a person of 34 years of age, the multiplier ''13'' was applied. After making reference to its own judgment in U.P. State Road Transport Corporation and Others Vs. Trilok Chandra and Others, , the Supreme Court observed that the Schedule of the Act suffers from defects. That, however, was in the context of a claim u/s 166 of the Act.

A Division Bench of this Court in A. Vijaya and Others Vs. Vegurla Rajaiah and Others, , observed as under:

The Supreme Court has repeatedly held that the structured formulae in the second schedule appended to the Act is only for those, whose annual income is upto Rs. 40,000/- and all other claims are required to be determined in terms of Chapter XII of the Act. In case of higher income, the prescribed multiplier in column No. 2 of the structured formulae of the second schedule is only a guidance.

In P. Annamma and Others Vs. N.N.A. Patrick and Another, , the learned Single judge of this Court had an occasion to consider the purport of the judgment of the Division Bench in A. Vijaya and Others Vs. Vegurla Rajaiah and Others, . In para-20 of the said judgment, it was observed as under:

In A. Vijaya and Others Vs. Vegurla Rajaiah and Others, , it was held at Paragraph No. 22 that the structured formulae in the second schedule appended to the Act is only for those whose annual income is upto Rs. 40,000/- and all other claims are required to be determined in terms of Chapter XII of the Act. In case of higher income the prescribed multiplier in column No. 2 of the structured formulae of the second schedule is only a guidance.

Reference was made to the judgment of this Court in K. Matura Bai and Others Vs. A. Shiva Nageswar Rao and Others, and it was concluded as under:

In view of the above judgments the contention of the Counsel for the Insurance Company that the structured formula appended to the Act cannot be made applicable to the applications u/s 166 of the Act and as the income is more than Rs. 40,000/- is not tenable and the same is rejected and the issue framed in this regard is answered in the affirmative.

With great respect, it is difficult to reconcile this observation with the ratio of the judgment in A. Vijaya and Others Vs. Vegurla Rajaiah and Others, . The Supreme Court and this Court, in many cases, held that the Schedule does not apply as it is to the cases, where the annual income exceeds Rs. 40,000/-, and at the most, in such cases, it can constitute a guidance. The requirement u/s 168 of the Act is the determination of compensation, which appears to be just. What is the just compensation to be awarded in a particular case, would depend upon the facts and circumstances of that case. Generalization was attempted in number of cases, such as by adopting the table, as in Bhagwandas Vs. Mohd. Arif, . Through legislative mechanism, Second Schedule to the Act, etc., was incorporated. Notwithstanding these guiding factors, the Tribunal and the Courts, as the case may be, are required to take the facts and circumstances of the cases into account, in complying with the requirement u/s 168 of the Act.

Once it has become evident that the Schedule was designed to meet a particular set of circumstances, relieving the claimant from the obligation to prove negligence, with limitation as to annual income etc., one of the indices in it, cannot be physically lifted and applied, as it is, in cases, which do not fit into the table. As observed in several cases, it can certainly be used as a guidance, but not as the sole basis.

In Bhagwandas Vs. Mohd. Arif, , this court had undertaken extensive discussion and a table was evolved. According to it, the multiplier to be applied for a person of the age of 55 years, would be ''4.27''. The income of the individual becomes irrelevant in applying this. In umpteen numbers of cases, it was applied and its applicability did not suffer any dent, notwithstanding the expression of doubts, as to its universality. Second Schedule, on the other hand, deals with the specified set of cases, where the income does not exceed Rs. 40,000/-. It must also be noted that after providing the corresponding figures upto the annual income of Rs. 40,000/-, the table did contain any formulae, similar to the one in the A.P. Court Fees and Suits Valuation Act, for application to the situations, beyond trial.

The Tribunal itself deviated from the Schedule, while granting compensation towards loss of consortium, loss of estate and funeral expenses, when it awarded Rs. 15,000/-, 15,000/- and 5,000/-, respectively, as against the corresponding figures of Rs. 5,000/-, 2,000/- and 2,000/-, in the Schedule. Having regard to the facts and circumstances of the case, this court is of the view that the application of multiplier ''5'' would meet the ends of justice.

Accordingly, the compensation payable to the respondents would be as under:

Loss of contribution to the family .... Rs. 3,80,000/- (Rs.76,000/- x 5) Loss of consortium .... Rs. 15,000/- Loss of estate .... Rs. 15,000/- Funeral expenses .... Rs. 5,000/- _______________ Total compensation .... Rs. 4,15,000/- _______________

The Tribunal awarded interest at 9%. In the recent past, the Supreme Court has been awarding interest at 7.5% for claims under the Act. Therefore, the balance of compensation shall carry interest at 7.5%. The ratio at which the amount of compensation was apportioned would remain the same.

The CMA is allowed to the extent indicated above. There shall be no order as to costs.