1 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED:15.11.2010 CORAM THE HONOURABLE MR. JUSTICE. P.P.S.JANARTHANA RAJA CMA(MD)NO.691 OF 2010 and MP(MD)No.3 OF 2010 The Managing Director, Tamil Nadu State Transport Corporation Ltd., Karaikudi. :Appellant/Respondent -Vs- 1.Karthiga Devi 2.Minor.M.Divya Bharathi 3.R.Kalyani (the minor 2nd respondent represented by her mother and natural guardian Karthiga Devi) :Respondents/Petitioners Appeal filed under Section 173 of the Motor Vehicles Act, 1988 against the Judgment and Decree dated 03.07.2008 made in M.C.O.P No.2 of 2006 on the file of the Motor Accidents Claims Tribunal, Principal Subordinate Judge, Kumbakonam. For appellant : Mr.N.Asaithambi For respondents: Mr.M.Subash Babu JUDGMENT This appeal is preferred by the appellant-Transport Corporation against the Judgment and Decree dated dated 03.07.2008 made in M.C.O.P No.2 of 2006 on the file of the Motor Accidents Claims Tribunal, Principal Subordinate Judge, Kumbakonam. 2.Background facts in a nutshell are as follows: The deceased-Mohan met with motor vehicle accident that took place on 25.11.2005 at about 1.00 p.m. The said deceased was travelling in a bus, bearing Registration No.TN-63-N-0772, belonging to the appellant-Transport Corporation. The said bus was proceeding from Karaikudi to Ramnad. On that day there was a heavy rain and there was over flowing of water in the river When the bus was nearing a bridge between Sanaveli and Sengamadai, the driver drove the bus in a rash and negligent manner and also at high speed, without taking any precaution, due to which, the bus washed away. Due to the impact, the deceased and the other persons died on the spot. The claimants are the wife, minor daughter and mother of the deceased. They claimed a sum of Rs.25,00,000/- as compensation. The appellant-Transport Corporation, resisted the claim. 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 bus belonging to the appellant-Transport Corporation and awarded a compensation of Rs.12,40,000/- with interest at 7.5% p.a. from the date of the claim petition. The details of the compensation are as under:- Heads Amount Loss of income Rs.12,00,000/- Loss of love and affection Rs. 30,000/- Funeral expenses Rs. 10,000/- ------------ Total... Rs.12,40,000/- ------------ Aggrieved by that award, the appellant-Transport Corporation has filed the present appeal. https://hcservices.ecourts.gov.in/hcservices/ 2 3.Learned counsel appearing for the appellant/Transport Corporation has questioned only the quantum of compensation awarded by the Tribunal and vehemently contended that the amount awarded by the Tribunal is excessive, exorbitant and also without any basis and justification. Therefore, the award passed by the Tribunal is not in accordance with law and hence the same should be set aside. 4.Learned counsel appearing for the respondents/claimants has submitted that the Tribunal had considered all the facts and circumstances of the case and awarded the compensation, which is just, fair and reasonable. It is a question of fact. Hence the order of the Tribunal is in accordance with law and hence the same should be confirmed. 5.Heard the counsel on either side and perused the materials available on record. On the side of the respondents/claimants, P.Ws.1 to 3 were examined and documents Exs.P1and P12 were marked. On behalf of the appellant-Transport Corporation one Muniyandi, the driver of the bus was examined as R.W.1 and no document was marked to substantiate their claim P.W.1-Karthigadevi, is the wife of the deceased. P.W.2-Chandramouli, is the eyewitness to the accident and also co-passenger of the deceased. P.W.3- Rajasekaran, is a Junior Assistant working in Adhi-Dravidar Welfare Department. Ex.P.1 is the xerox copy of the First Information Report Ex.P.2 is the Death Certificate. Ex.P3 is the Legal Heirship Certificate Exs.P4 and P12 are the Pay Certificates of the deceased. Exs.P5 and P11 are the Identity Cards. Exs.P6 and P7 are the Provisional Certificates. Ex.P8 is the Diploma Certificate. Ex.P9 is the Typewriting Certificate. Ex.P10 is the Certificate issued by Adhi-Dravidar Welfare Department. After considering the above oral and documentary evidence, the Tribunal had given a categorical finding that the accident had occurred only due to the rash and negligent driving of the driver of the bus. The finding of the Tribunal is based on valid materials and evidence and it is a question of fact Hence the same is confirmed. 6.In the case of SARLA VERMA AND OTHERS VS. DELHI TRANSPORT CORPORATION AND ANOTHER 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: "7.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 Vs. Susamma Thomas AIR 1994 SC 1631: (1994) 2 SCC 176. 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 https://hcservices.ecourts.gov.in/hcservices/ 3 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." "It is necessary to reiterate that the multiplier method is logically sound and legally well-established. There are some cases which have proceeded to determine the compensation on the basis of aggregating the entire future earnings for over the period the life expectancy was lost, deducted a percentage therefrom towards uncertainties of future life and award the resulting sum as compensation. This is clearly unscientific. For instance, if the deceased was, say 25 years of age at the time of death and the life expectancy is 70 years, this method would multiply the loss of dependency for 45 years — virtually adopting a multiplier of 45 — and even if one-third or one-fourth is deducted therefrom towards the uncertainties of future life and for immediate lump sum payment, the effective multiplier would be between 30 and 34. This is wholly impermissible." In UP State Road Transport Corporation V. Trilok Chandra (1996) 4 SCC 362, this Court, while reiterating the preference to Davies method followed in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas (supra), stated thus: https://hcservices.ecourts.gov.in/hcservices/ 4 "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 therefrom 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) 7. In the case of SYED BASHEER AHAMED AND OTHERS VS. MOHAMMED JAMEEL AND ANOTHER reported in (2009) 2 Supreme Court Cases 225, the Apex Court has held as follows: "13. 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. 14. Similarly, 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. 15. In Kerala SRTC v. Susamma Thomas2, M.N. Venkatachaliah, J. (as His Lordship then was) had observed that: (SCC p.181, para 5) “5. … The determination of the quantum must answer what https://hcservices.ecourts.gov.in/hcservices/ 5 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’.” At 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. 18. 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 Gobald 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.” 19. Taking note of the afore extracted observations in Gobald Motor Service Ltd. in Susamma Thomas it was observed that: (Susamma Thomas case, SCC p.182, para 9) “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.” 20. 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 https://hcservices.ecourts.gov.in/hcservices/ 6 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. 8.At the time of the accident, the deceased-Mohan was aged 40 years P.W.1, the wife of the deceased, in her evidence has stated that the age of the deceased was 40 years at the time of accident. After considering the same, the Tribunal has fixed the age of the deceased at 40 years. Further in her evidence, she stated that the deceased was working as a Warden in the Government Boys Hostel at Nalladai. P.W.3-Rajasekaran, who is the Junior Assistant working in Adhi-Dravidar Welfare Department, stated that the deceased was earring a sum of Rs.13,504/- per month. Ex.P12, is the Pay Certificate given by Special Thasildar. Ex.P-4 is the Pay Certificate of the deceased. Exs.P6 and P10 are the proof of educational qualifications of the deceased. He was a qualified M.A.M.Ed. After considering the above oral and documentary evidence, the Tribunal has fixed the monthly income of the deceased at Rs.10,424/- and determined the annual income at Rs.1,20,000/-. After considering the age of the deceased, the Tribunal adopted the multiplier of '16' and stated that the deceased would approximately get Rs,18,00,000/-. Thereafter, the Tribunal deducted 1/3rd of the amount towards personal expenses of the deceased and arrived at Rs.12,00,000/- towards loss of income. Actually, the Tribunal has determined the annual income at Rs.1,20,000. If '16' multiplier is adopted the loss of income works out to Rs.19,20,000/-(Rs.1,20,000X16). Out of the said sum, if 1/3rd of the amount is deducted towards personal expenses of the deceased, the loss of income works out to Rs.12,80,000/-, but the Tribunal has erred in computing the loss of income at Rs.12,00,000/- Learned counsel for the appellant-Transport Corporation vehemently contended that the Tribunal is wrong in adopting the multiplier of '16' and the correct multiplier that should adopted in the present case is '15'. He relied on the Supreme Court judgment in the case of SARLA VERMA AND OTHERS VS. DELHI TRANSPORT CORPORATION AND ANOTHER (cited supra) in support of his contention. As rightly pointed out by the learned counsel for the appellant-Transport Corporation, as per the principles enunciated in the Sarala Verma's case (cited supra) the correct multiplier that should be adopted in the present case is '15'. If '15' multiplier is adopted, the loss of income works out to Rs.12,00,000/-(Rs.1,20,000X15X2/3). Already, the Tribunal has awarded a sum of Rs.12,00,000/- towards the loss of income The amount awarded under this head is also very reasonable and hence the same is confirmed. The Tribunal has awarded a sum of Rs.30,000/- towards loss of love and affection. After taking into consideration of the age of the wife of the deceased and the fact that the minor daughter has lost the love and affection of her father and that the mother of the deceased has also lost the love and affection of her son. This Court is of the view that the amount awarded under this head is very reasonable and hence the same is confirmed. The Tribunal has awarded a sum of Rs.10,000/- towards funeral expenses, which is very reasonable and hence the same is confirmed. The Tribunal has fixed the interest rate at 7.5% p.a. from the date of petition After taking into consideration of the date of accident, date of award and also prevailing rate of interest during that period, I feel that the https://hcservices.ecourts.gov.in/hcservices/ 7 interest rate fixed by the Tribunal at 7.5% p.a. from the date of petition is reasonable and hence the same is confirmed. 9.In the result, the compensation awarded by the Tribunal at Rs.12,40,000/- with interest at 7.5% p.a from the date of petition is confirmed and accordingly, the Civil Miscellaneous Appeal is dismissed Consequently, the connected miscellaneous petition is closed. No costs. Sd/- Assistant Registrar (CO) / TRUE COPY / Sub Assistant Registrar To: The Motor Accidents Claims Tribunal, Principle Subordinate Judge, Kumbakonam. Copy To:The Section Officer, V.R.Section, Madurai Bench of Madras High Court, Madurai. +1CC to Mr.M.Subash Babu, Advocate. SR.No.46253. +1CC to Mr.N.Asaithambi, Advocate. SR.No.46247. +1LR COPY. Vsm C.M.A.(MD)No.691 of 2010 RP/03.01.2011/7P/6C. 15.11.2010 https://hcservices.ecourts.gov.in/hcservices/