FAO No.1133 of 2010 -1- IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No.1133 of 2010 DATE OF DECISION: January 12, 2011 USHA RANI & OTHERS ...APPELLANTS VERSUS RANJEET SINGH & OTHERS ...RESPONDENTS CORAM: HON'BLE MR. JUSTICE K.KANNAN. 1. Whether reporters of local papers may be allowed to see the judgement. Yes 2. To be referred to the reporters or not? Yes 3. Whether the judgement should be reported in the digest? Yes ---- PRESENT: MR. ASHWANI ARORA, ADVOCATE FOR THE APPELLANTS. MR. R.S. DHULL, ADVOCATE FOR THE RESPONDENTS. K.KANNAN, J.(ORAL) I. Appeal for enhancement of compensation. 1. The appeal is for enhancement of compensation for the death of a Head Constable whose income was shown as `15,817/-. The claimants were widow and three minor children. Counsel appearing for the appellants seeks for reappraisal of the award in the light of the decision in Sarla Verma vs. DTC, reported as 2009 6 SCC 121 that provides for 30% increase in salary and gross salary minus tax must be taken as multiplicant. He also pleads that the appropriate multiplier would be 14 for his age and not just 12, as taken by the Tribunal. II. Just compensation in the light of Sarla Verma judgement. 2. I tabulate the compensation as awarded by the Tribunal and make a justification for an increase in the manner laid down by the Hon'ble Supreme Court in Sarla Verma's case (supra). The Tribunal has also not FAO No.1133 of 2010 -2- awarded the conventional heads of claim for loss of love and affection, loss of consortium, loss to estate and funeral expenses. They are also provided in the table below: Fatal Accidents Age: 45 Occupation Head Constable Claimants Wife, three minor children Heads of Claim Tribunal High Court Sr.No. Amount ` Amount ` 1. Annual Income 1,80,000/- 1,89,600/- 2. Add % of increase 30%/50% 30% (56880) 3. Deduction (1/2,1/3, 1/4, 1/5) 1/3rd 1/4th 4. Multiplicand - Tax 1,20,000/- 2,21,832/- 5. Multiplier 12 14 6. Loss of Dependence 14,40,000/- 1,66,374/- x14 =23,29,236/- 7. Medical Expenses 8. Loss of Consortium + loss of love and affection 20,000/- 9. Loss to Estate 5000/- 10. Funeral Expenses 2500/- Total 14,40,000/- 23,56,736/- III. Number of years of deposit. 3. It has been a painful reality that the awards made by the Tribunal are mis-spent or unjustly appropriated and the entire amount does not reach the representatives of deceased victims of accidents. This malady was sought to be remedied by giving directions for deposit of amounts in banks for disbursal over a period of time, alike to a situation of what would have happened if the deceased had lived. Determination of compensation involves a large measure of approximation and it is difficult to truly predict how long the deceased would have lived if he had not met with the accident. The multiplier theory and choice of its value supposes the normal life span FAO No.1133 of 2010 -3- to be 70 years and provides for a maximum value of 18. In all cases of compensation, it is therefore desirable that the amounts awarded are disbursed over a period of years that will a last a life time. In any event, the amount shall be spread at least to the minimum number of years' purchase adopted through the value of the multiplier. For instance, if a person dies at an age above 50, the maximum period of deposit shall be 20 years and in any event, not less than 11 years, if the multiplier adopted is 11. This may be subject to a reduction by numbers of years of pendency of the case from the date of accident. If an accident has taken place in 2006 and the case is decided in 2011 by the tribunal, in the above illustration, 45% of the amount awarded (approximately, the amount equivalent to 5/11 share, i.e., 5 years of pendency divided by the value of multiplier provided) and the 55% shall be disbursed spread over a period of 6 years into 6 equal shares, the first share being retained in a deposit falling due by the end of 1st year, the second share in a deposit falling due by the end of two years and so on till the 6th share maturing on the completion of 6 years. IV. In case of a minor claimant. 4. If any of the claimants is a minor, the retention in deposit shall be compulsory during the period of minority and a portion equivalent tot he number of years from the date of accident that bears to the value of the multiplier on the whole amount shall be disbursed on attaining majority and the balance deposited and released gradually in the manner referred to above. V. Scheme with the bank. 5. It is most desirable that the Tribunal engages the bank in which the court normally operates its accounts in proper dialogue through its FAO No.1133 of 2010 -4- administrative head and opens an account in the name of the party with specific directions that the deposits shall not be liable for premature closure for withdrawal. The Bank shall hand over the original fixed deposit receipt with the Tribunal and furnish a photo copy to the party. It shall also deliver to the party a cheque book to enable the party to operate the account that shall be opened in the party's name as and when the amount is mature or interest is credited. The interest accruals shall be freely operational by the parties without having to seek any further directions for withdrawal through the Tribunal. Any particular type of deposit that the claimant suggests as most beneficial to him may be accepted by the Tribunal. The choice of the Bank may also be left to the claimant to choose, if he has a preference to any other bank other than where the Tribunal normally banks its deposits. VI. Awards of Lok Adalat shall be no exception. 6. The same principle shall be followed even for awards of Lok Adalats. Settlements through Lok Adalat shall not be resorted only to secure full withdrawals without the restrictive norms detailed above. No temptation need be given to parties to settle through Lok Adalats through the pernicious practice for allowing full withdrawals. Lok Adalat shall not be forums to breach a sanctified principle to protect the victim's entitlement to compensation that is designed to protect against exploitation and misuse. (See Lilaben Udesing Gohel v Oriental Insurance Company Ltd. AIR 1996, SC 1605, 1996 ACJ 673; Sukhwinder Kaur v Amir Singh 1997 ACJ 774 (P&H). VII. Exceptions to the rule. 7. Premature withdrawal shall be an exception rather than the rule. Marriage expenses or education expenses shall be instances for premature FAO No.1133 of 2010 -5- withdrawal and the amounts permitted to be withdrawn shall be reasonable to the wants established. All emergency situation cannot be visualized and the Tribunal shall, when such a situation arises and the party approaches for withdrawal of the amount, it shall apply its mind and pass appropriate orders. (See General Manager, KSRTC v Susamma Thomas AIR 1994 SC 1631). The direction for deposit need not be resorted to for claimants who are parents and who are above 50 years of age (See H.S. Ahammed Hussain v Irfan Ahammed (2002) 6 SCC 52). The deposits need not also be insisted for total value of award which are less than Rs.50,000/- or where the individual share falls less than Rs.50,000/-. In injury cases, all the amounts other than sums which are determined for loss of future earnings may be allowed to be withdrawn. VIII. Present disposition. 8. Any difficulty experienced in working this suggestion may be brought to the attention of the High Court to which the Tribunal is subordinate and seek for appropriation modification. 9. The amount in excess over what has already been awarded by the Tribunal shall attract interest @ 6% from the date of petition till the date of payment. The amount shall be distributed equally amongst the claimants. 10. The accident has taken place in 2007. Since I have adopted a multiplier of 14, I will direct that the widow would be entitled to withdrawal of 30% and the balance of 70% shall be deposited in a nationalized bank for a period of 10 years. As regards the share of the widow, the deposit shall be split into 10 equal shares, the 1st deposit of 1 year, the 2nd deposit for 2 years and so on till 10 years. As regards the shares of minors, the interest shall be paid to the mother as guardian quarterly for maintenance of the FAO No.1133 of 2010 -6- minor children in the manner referred to in para IV above. January 12, 2011 (K.KANNAN) Gulati JUDGE FAO No.1133 of 2010 -7-