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Judgment
P.P.S. Janarthana Raja, J.—By consent, the main appeal itself is taken up for final disposal at the time of admission.
The appeal is preferred by the Appellant-Insurance Company against the judgment and decree dated 24.11.2009 made in MCOP No. 154 of
2008 on the file of the Motor Accident Claims Tribunal (Subordinate Judge) at Gudiyattam.
Background facts in a nutshell are as follows:
The deceased Nallathambi met with motor vehicle accident that took place on 06.06.2008 at about 16.30 hrs. While the deceased was going by
cycle, near Chinna Komeswaram, Opposite to TAW Co., a Maruthi Swift Car bearing registration No. KA-05-ME-9712 came in a rash and
negligent manner and also high speed, hit the deceased cyclist. Due to the accident, the deceased sustained multiple grievous injuries all over the
body and was immediately taken to Ambur Government hospital and died on 11.06.2008. The claimants are wife, minor children and mother of
the deceased and claimed a compensation of Rs. 10,00,000/-. The said car was insured with the Appellant-Insurance Company who resisted the
claim. On pleadings the Tribunal framed the following issues:
Whether the accident was happened only due to the rash and negligent driving of the driver of the Swift Car driver bearing Regn. No. KA-05-
ME-9712 ?
Whether the claimants are entitled to compensation? and to what extent ?
To What relief ?
After considering the oral and documentary evidence, the Tribunal held that the accident had occurred only due to the rash and negligent driving of
the driver of the car and awarded a compensation of Rs. 7,79,800/-with interest at 6% per annum from the date of petition and the details of the
same are as under:
Loss of income Rs. 7,34,400/-
Loss of consortium Rs. 5,000/-
Loss of love and affection Rs. 15,000/-
(each Rs. 5000)
Funeral expenses Rs. 10,000/-
Medical expenses Rs. 8,800/-
Transport expenses Rs. 6,600/-
Total... Rs. 7,79,800/-
Aggrieved by that award, the Appellant-Transport Corporation has filed the present appeal.
The learned Counsel appearing for the Appellant/Insurance Company vehemently contended that they are not liable to pay the compensation
and it is only the deceased who was responsible for causing the accident and therefore they are not liable to pay the compensation and further it
was contended that the amount awarded by the tribunal is excessive, exorbitant, without basis and justification and that therefore, the award
passed by the Tribunal is not in accordance with law and the same has to be set aside.
Heard the learned Counsel and perused the document on record. On the side of the claimants, the first Respondent herein, who is the wife of
the deceased, was examined as P.W.1. PW2-one Easupatham, the eye witness to the occurrence was also examined. Documents Exs.P1 to P9
were marked. Ex.P1 is the certified copy of the FIR. Ex.P2 is the certified copy of the Postmortem certificate. Ex.P3 is the death certificate. Ex.P4
is the Medical bills. Ex.P5 is the Transport bills. Ex.P6 is the certified copy of MVI report. Ex.P7 is the certified copy of charge sheet . Ex.P8 is
the copy of the insurance policy. Ex.P9 is the salary certificate. On the side of the Appellant-Insurance Company, no one was examined and no
document was marked to substantiate their claim. After considering the above oral and documentary evidence, the Tribunal has given a categorical
finding that the accident had occurred only due to the rash and negligent driving of the driver of the car and the finding is based on valid materials
and evidence.
In the case of Sarla Verma And Ors. v. Delhi Transport Corporation and Anr. reported in (2009) 4 MLJ 997, the Apex Court has considered
the relevant factors to be taken into consideration before awarding compensation and held as follows:
Before considering the questions arising for decision, it would be appropriate to recall the relevant principles relating to assessment of
compensation in cases of death. Earlier, there used to be considerable variation and inconsistency in the decisions of Courts Tribunals on account
of some adopting the Nance method enunciated in Nance V. British Columbia Electric Rly. Co. Ltd. (1951) AC 601 and some adopting the
Davies method enunciated in Davies V. Powell Duffryn Associated Collieries ltd. (1942) AC 601. The difference between the two methods was
considered and explained by this Court in General Manager, Kerala State Road Transport Corporation, Trivandrum Vs. Mrs. Susamma Thomas
and others, . After exhaustive consideration, this Court preferred the Davies method to Nance method. We extract below the principles laid down
in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas(supra).
In fatal accident action, the measure of damage is the pecuniary loss suffered and is likely to be suffered by each dependent as a result of the death.
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
live 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.
The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependants, and to
deduct therefrom such part of his income as the deceased was accustomed to spend upon himself, as regards both self-maintenance and pleasure,
and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependants. Then that should be
capitalised by multiplying it by a figure representing the proper number of year''s purchase."" ""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.
In U.P. State Road Transport Corporation and Others Vs. Trilok Chandra and Others, , this Court, while reiterating the preference to Davies
method followed in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas (supra), stated thus:
In the method adopted by Viscount Simon in the case of Nance also, first the annual dependency is worked out and then multiplied by the
estimated useful life of the deceased. This is generally determined on the basis of longevity. But then, proper discounting on various factors having a
bearing on the uncertainties of life, such as, premature death of the deceased or the dependent, remarriage, accelerated payment and increased
earning by wise and prudent investments, etc., would become necessary. It was generally felt that discounting on various imponderables made
assessment of compensation rather complicated and cumbersome and very often as a rough and ready measure, one-third to one-half of the
dependency was reduced, depending on the life span taken. That is the reason why courts in India as well as England preferred the Davies formula
as being simple and more realistic. However, as observed earlier and as pointed out in Susamma Thomas case, usually English courts rarely
exceed 16 as the multiplier. Courts in India too followed the same pattern till recently when tribunals/courts began to use a hybrid method of using
Nance method without making deduction for imponderables.... Under the formula Advocated by Lord Wright in Davies, the loss has to be
ascertained by first determining the monthly income of the deceased, then deducting there from the amount spent on the deceased, and thus
assessing the loss to the dependants of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an
appropriate multiplier
(emphasis supplied)
In the case of Syed Basheer Ahamed and Others Vs. Mohd. Jameel and Another, , the Apex Court has held as follows:
Section 168 of the Act enjoins the Tribunal to make an award determining ""the amount of compensation which appears to be just"". However,
the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression
which appears to be just"" vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude
of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of
compensation.
milarly, although the Act is a beneficial legislation, it can neither be allowed to be used as a source of profit, nor as a windfall to the persons
affected nor should it be punitive to the person(s) liable to pay compensation. The determination of compensation must be based on certain data,
establishing reasonable nexus between the loss incurred by the dependants of the deceased and the compensation to be awarded to them. In a
nutshell, the amount of compensation determined to be payable to the claimant(s) has to be fair and reasonable by accepted legal standards.
Kerala SRTC v. Susamma Thomas, M.N. Venkatachaliah, J. (as His Lordship then was) had observed that: (SCC p. 181, para 5)
...The determination of the quantum must answer what contemporary society ''would deem to be a fair sum such as would allow the wrongdoer
to hold up his head among his neighbours and say with their approval that he has done the fair thing''. The amount awarded must not be niggardly
since the ''law values life and limb in a free society in generous scales
the same time, a misplaced sympathy, generosity and benevolence cannot be the guiding factor for determining the compensation. The object of
providing compensation is to place the claimant(s), to the extent possible, in almost the same financial position, as they were in before the accident
and not to make a fortune out of misfortune that has befallen them.
The question as to what factors should be kept in view for calculating pecuniary loss to a dependant came up for consideration before a three-
Judge Bench of this Court in Go bald Motor Service Ltd. v. R.M.K. Veluswami4, with reference to a case under the Fatal Accidents Act, 1855,
wherein, K. Subba Rao, J. (as His Lordship then was) speaking for the Bench observed thus: (AIR p. 1)
In calculating the pecuniary loss to the dependants many imponderables enter into the calculation. Therefore, the actual extent of the pecuniary loss
to the dependants may depend upon data which cannot be ascertained accurately, but must necessarily be an estimate, or even partly a conjecture.
Shortly stated, the general principle is that the 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.
Taking note of the afore extracted observations in Go bald Motor Service Ltd. in Susamma Thomas it was observed that: (Susamma Thomas
case, SCC p.182, para 9)
Thus, for arriving at a just compensation, it is necessary to ascertain the net income of the deceased available for the support of himself and his
dependants at the time of his death and the amount, which he was accustomed to spend upon himself. This exercise has to be on the basis of the
data, brought on record by the claimant, which again cannot be accurately ascertained and necessarily involves an element of estimate or it may
partly be even a conjecture. The figure arrived at by deducting from the net income of the deceased such part of income as he was spending upon
himself, provides a datum, to convert it into a lump sum, by capitalising it by an appropriate multiplier (when multiplier method is adopted). An
appropriate multiplier is again determined by taking into consideration several imponderable factors. Since in the present case there is no dispute in
regard to the multiplier, we deem it unnecessary to dilate on the issue.
After considering the principles enunciated in the judgments cited supra, let me consider the facts of the present case.
At the time of the accident, the deceased-Nallathambi was aged about 35 years. In the evidence of PW1, it is stated that the age of the
deceased was 35 years at the time of accident. Further, in the evidence of PW1, it is stated that the deceased was working at Azhinjikupam, Sri
Varadharaj Coconut Company as a coconut peeler and earning a sum of Rs. 6,000/-per month. Ex.P9 is the salary certificate given by the said
company. After considering Ex.P2, Postmortem report in which it is stated that the deceased was aged 35 years at the time of accident, the
Tribunal has fixed the age of the deceased as 35 years. In respect of salary, the Tribunal has viewed that the deceased would be earning not less
than Rest. 180/-per day, fixing income of the deceased at Rs. 180/-per day and determined the monthly income of the deceased at Rs. 5,400/-
(Rs. 180 x 30) and the annual income at Rs. 64,800/-(Rs. 5,400/-x 12). After considering the age of the deceased as 27 years, the Tribunal had
correctly adopted the multiplier of 17 and arrived the loss of income at Rs. 11,01,600/-(Rs. 64,800 x 17). Out of the said sum of Rs. 11,01,600/-,
the Tribunal had deducted 1/3rd, i.e. Rs. 3,67,200/-(Rs. 11,01,600 x 1/3) towards personal expenses of the deceased and the balance amount of
Rs. 7,34,400/-was taken as the annual contribution of the deceased to his family (Rs. 11,01,600 - Rs. 3,67,200). The Tribunal had correctly fixed
the monthly income, correctly fixed the age of the deceased and correctly deducted 1/3rd towards personal expenses and correctly adopted the
multiplier 17, as per schedule. So, the amount awarded under the loss of income is reasonable and the same is confirmed. The Tribunal has
awarded a sum of Rs. 5,000/-towards loss of consortium which is very reasonable and the same is confirmed. The Tribunal has also awarded a
sum of Rs. 15,000/-i.e. Rs. 5,000/-each to the claimants 2, 3 and 5 towards loss of love and affection. The amount awarded under this head is
also very reasonable and the same is confirmed. The Tribunal has awarded a sum of Rs. 10,000/-towards funeral expenses, which I feel are very
reasonable and the same is confirmed. The Tribunal has also awarded a sum of Rs. 8,800/-towards Medical expenses because the deceased was
admitted in the hospital and Ex.P4 is the series of medical bills which was incurred for the deceased, which is reasonable and the same is
confirmed. The Tribunal has awarded a sum of Rs. 6,600/-towards transport expesnes which is very reasonable and the same is confirmed. The
Tribunal has also awarded interest at the rate of 6% per annum after considering the date of award and prevailing rate during the period, which I
feel is very reasonable and the same is confirmed. I do not find any error or illegality in the order of the Tribunal so as to warrant interference by
this Court. It is a question of fact. It is not a perverse order. Therefore, the award passed by the Tribunal is in accordance with law and the same is
confirmed. Accordingly, it is not a fit case for admission and the Civil Miscellaneous Appeal is dismissed. No costs. Consequently, M.P. No. 1 of
2010 is also dismissed.