IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 22.12. 2008 CORAM:- The Hon'ble Mr. Justice R. SUDHAKAR C.M.A.No.4095 of 2008 and M.P.No.1 of 2008 National insurance Co. Ltd., No.751, Anna Salai, Chennai.2 .. Appellant/Ist Respondent Vs. 1. Mrs.N.Mari 2. Suguna (Minor) 3. Manikandan(Minor) 4. Rehka (Minor) 5. Uma (Minor) Minors 2 to 5 rep. By their mother and next friend Mrs. N.Mari) 6. Mrs.Devaki 7. Mr.M.Kumarasamy 8. M/S.Polaris Software lab ltd., No.713, Anna Salai, Chennai.2. .. Respondents/Petitioners I Respondent . . . Appeal filed under Section 173 of the M.V.Act against the award and decree dated 16.11..2007 made in M.C.O.P No.4211 of 2003 on the file of the Motor Accidents Claims Tribunal, (Additional District Judge (FTC-II) Chennai. . . . For Appellant : Mr.Arun Kumar For respondents : Mr.T.G.Balachandran . . . J U D G M E N T The Insurance Company has filed this appeal challenging the award dated 16.11..2007 made in M.C.O.P No.4211 of 2003 on the file of the Motor Accidents Claims Tribunal, (Additional District Judge (FTC-II) Chennai. https://hcservices.ecourts.gov.in/hcservices/ 2. It is a case of fatal accident. The accident in this case happened on 11.08.2003. The deceased Natarajan, aged about 34 years, a Plumber by occupation, was travelling on a two wheeler at Anna Main road, K.K.Nagar. A private bus bearing Registration No.TN-28-C-5099 insured with the appellant driven by its driver in a rash and negligent manner hit the said Natarajan. In that accident, he suffered grievous injuries and died. The wife of the deceased aged 31 years, three minor daughters aged 15, 8 and 7 years and one minor son aged 9 years, father aged 57 years and mother aged 54 years, filed a claim for compensation in a sum of Rs.8,00,000/- stating that the deceased was earning a sum of Rs.5,000/- per month. 3. In support of the claim, the wife of the deceased was examined as P.W.1 and the eye witness, one Shankar was examined as P.W.2. Documents were marked as Exs.P.1 to P.9. Ex.P.1 is the copy of First Information Report. Ex.P.2 is the rough sketch. Ex.P.3 is the copy of Charge Sheet. Ex.P.4 is the Death Certificate. Ex.p.5 is the Post Mortem Certificate. Ex.P.6 is the Transfer Certificate of the deceased Natarajan. Ex.P.7is the medical bill. Ex.P.8 is the Legal heir certificate. Ex.p.9 is the Salary Certificate. No oral or documentary evidence was let in on behalf of the appellant/respondent before the Tribunal. 4. The finding of negligence on the part of the driver of the bus who caused the accident and the liability fixed on the Insurance Company, appellant to compensate the claimants is not disputed. Accordingly, the said finding is confirmed. 5. The Tribunal on the basis of Ex.P.9, Salary Certificate and also taking note of the fact that a Plumber would earn Rs.200/- per day, fixed the income of the deceased at Rs.5,000/- per month. The salary Certificate was issued by one K.G.C. Company where the deceased was said to have been working before his death for very number of years. After deduction 1/3 towards personal expenses of the deceased, the Tribunal fixed the contribution to the dependants at Rs.3,330/- per month. Based on Ex.P.5, the Post mortem Certificate and Ex.P.6, the Transfer Certificate of the deceased, the Tribunal fixed the age of the deceased as 34 and by adopting 17 multiplier in terms of Schedule II to Section 163(A) of the Motor Vehicles Act, granted a sum of Rs.6,79,320/- as pecuniary loss. The Tribunal also granted compensation under conventional heads. In all the Tribunal granted the following amounts with interest at 7.5% as compensation. https://hcservices.ecourts.gov.in/hcservices/ Sl.No. Award Amount granted by the Tribunal 1 Pecuniary Loss Rs. 6,79,320/- 2. Loss of consortium to the wife,loss of love and affection for the children and parents of the deceased Rs. 20,000/- 3 Funeral expenses Rs. 5 000/- Total Rs. 7,04,320/- 6. In appeal, the learned counsel for the appellant pleaded that the multiplier of 17 adopted and the income fixed by the Tribunal are higher. He pleaded for reduction in the compensation by re-working the quantum of compensation on the above basis. 7. The learned counsel for the claimant, on the other hand, stated that meagre amount has been granted for the wife towards loss of consortium and also to the children for loss of love and affection on the death of their father and parents and therefore, justified the quantum of compensation awarded by the Tribunal. 8. The Apex Court in the case of General Manager, Kerala State Road Transport Corporation VS Susamma Thomas and others reported in(1994) 1 ACC 346(SC) = AIR 1994 SC 1631 has set out as to how the multiplier should be fixed, which runs as follows: "11. 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 awarded the resutling sum as compensation. This is clearly unscientific.For instance, if the deceased say, say, 25 years of age at the time of death and the life expectancy is 70 years, this method would multiply the cost 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 https://hcservices.ecourts.gov.in/hcservices/ of future life and for immediate lump sum payment, the effective multiplier would be between 30 and 34. This is wholly impermissible. We are aware that some decisions of the High Courts and of this court as well have arrived at compensation on some such basis. These decisions cannot be said to have laid down a settled principle. They are merely instances of particular awards in individual cases. The proper method of computation is the multiplier method. Any departure, except in exceptional and extraordinary cases, would introduce inconsistency of principle, lack of uniformity and an element of unpredictability and an element of unpredictability for the assessment of compensation. Some judgments of the High Courts have justified a departure from the multiplier method on the ground that section 110-B of the Motor Vehicles Act, 1939, in so far as it envisages the compensation to be 'just', the statutory determination of a 'just' compensation would unshackle the exercise from any rigid formula. It must be borne in mind that the multiplier method is the accepted method of ensuring a 'just' compensation which will make for uniformity and certainty of the awards. We disapprove these decisions of the High Courts which have taken a contrary view. We indicate that the multiplier method is the appropriate method, a departure from which can only be justified in rare and extraordinary circumstances and very exceptional cases. The multiplier represents the number of years' purchase on which the loss of dependency is capitalised. Take, for instance, a case where annual loss of dependency is Rs.10,000/-. If a sum of Rs.1,00,000/- is invested at 10 per cent annual interest, the interest will take care of the dependency perpetually. The multiplier in this case works out to 10. If the rate of interest is 5 per cent per annum and not 10 per cent, then the multiplier needed to capitalise the loss of the annual dependency at Rs.10,000/- would be 20. Then the multiplier, i,e., the number of years' https://hcservices.ecourts.gov.in/hcservices/ purchase of 20 will yield the annual dependency perpetually. Then allowance to scale down the multiplier would have to be made taking into account the uncertainties of the future, the allowances for immediate lump sum payment, the period over which the dependency is to last being shorter and the capital feed also to be spent away over the period of dependency is to last, etc. Usually in English courts the operative multiplier rarely exceeds 16 as maximum. This will come down accordingly as the age of the deceased person (or that of the dependents, whichever is higher) goes up." The multiplier in this case has to be suitably fixed keeping the above stated decision of the Apex Court. 9. Insofar as the income in concerned, except the Salary Certificate-Ex.P.9, there is no evidence let in by the employer or any other document to show that a sum of Rs.5,000/- has been paid regularly to the deceased. In such view of the matter keeping in mind the cost of living in future, the income of the deceased can be fixed at Rs.4,500/- Considering the period of accident, which happened in the year 2003, this will keep in line with the living wages and minimum wages at the relevant period of time. As far as the multiplier is concerned, since the claimants are getting lumpsum payment and also in view of the decision of the Apex Court in General Manager, Kerala State Road Transport Corporation VS Susamma Thomas and others and in New India Assurance – vs.- Smt.Kalpana and others reported in 2007 AIR SCW 1316 = 2007(1) Supreme 514 and in The Managing Director, TNSTC – vs. - Sripriya and others reported in 2007(1) TN MAC 319 (SC), the proper multiplier would be 15 as against 17. Accordingly, the pecuniary loss to the dependants will be Rs.4,500- Rs.1,500 = Rs.3,000/- p.m. X 12 =Rs.36,000 X 15 = Rs.5,40,000/- The wife of the deceased will be entitled to Rs.15,000/- towards loss of consortium. The four minor children are entitled to Rs.10,000/- each towards loss of love and affection on the death of their father. The parents of the deceased will be entitled to Rs.5,000/- each towards loss of love and affection on the death of their son. The claimants are entitled to a sum of Rs.5,000/- towards funeral expenses which would include the transport expenses as well. A sum of Rs..2,500/- is granted towards loss of estate. Learned counsel for the claimants states that the deceased was in the hospital for 18 days and during that period, he suffered great mental agony and pain and suffering and the family members should be suitably compensated for the same. Therefore, for pain and suffering, mental agony during the period of hospitalisation a sum of Rs.7,500/- is awarded. In all, the https://hcservices.ecourts.gov.in/hcservices/ award of the Tribunal is modified as follows. Sl.N o. Award Amount granted by the Tribunal Amount granted by this Court 1 Pecuniary Loss Rs. 6,79,320/- Rs. 5,40,000/- 2. Loss of consortium to the wife,loss of love and affection for the children and parents of the deceased Rs. 20,000/- Rs. 15,000/- Rs. 40,000/- Rs. 10,000/- 3 Funeral expenses Rs. 5 000/- Rs. 5,000/- 4. Loss to the Estate Rs 2,500/- 5. Pain and suffering, mentalagony during the period of hospitalisation. Rs. 7,500/- Total Rs. 7,04,320/- Rs. 6,20,000/- Since the accident in this case happened in the year 2003 and the award was passed in the year 2007, the rate of interest at 7.5% granted by the Tribunal stands confirmed. 10. The learned counsel for the appellant seeks eight weeks' time to deposit the balance amount as awarded by this Court. On such deposit, the claimants are entitled to withdraw the amount as apportioned below. 11. In the result, the Civil Miscellaneous Appeal is allowed in part as follows: i. The award of the Tribunal is reduced to Rs.6,20,000/- from Rs.7,04,320/- ii. the interest granted by the Tribunal at 7.5% stands confirmed. iii. The award amount is apportioned as follows:. The wife, first respondent Rs.2,20,000/- with proportionate interest and costs Three minor daughters and one minor son each Rs.85,000/- Rs.3,40,000/- with proportionate interest The father and mother of the deceased, each Rs.30,000/- Rs.60,000/- with proportionate interest https://hcservices.ecourts.gov.in/hcservices/ iv. The wife, first respondent is permitted to withdraw her share amount with proportionate interest and entire costs. v. The father and mother, respondents 6 and 7 are permitted to withdraw their share amounts with proportionate interest. vi. The share of the minor respondents 2 to 5 /claimants 2 to 5 shall be invested in any one of the Nationalised Bank proximate tot he place of the residence of the first respondent/first claimant for a period of three years and renewable thereafter till the minors attain majority. The mother of the minor respondents 2 to 5 is permitted to withdraw the accrued interest in respect of the shares of the minors once in three months directly from the bank and for the said purpose the first respondent/first claimant shall open a Savings Bank Account in the same Branch and the interest amount shall be transferred to the account to be maintained by the mother of the minors. Vii. The Natinoalised Bank to which the amount will be deposited, shall intimate to the first, sixth and seventh respondents respectively of such deposit and confirm the same to the Tribunal that the respondent Nos.1,6 and 7 have been duly informed. The Tribunal to instruct the Bank accordingly. viii. Since the deposit is in the case of minors, the Tribunal is directed to send a report containing the details of the deposit to the High Court on such deposit. ix. Consequently, connected miscellaneous petition is closed. x. There will be no order as to costs. PAL Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar https://hcservices.ecourts.gov.in/hcservices/ To 1. The Motor Accidents Claims Tribunal, Additional District Judge, (FTC.NO.II) Chennai. 2. The Section Officer, VR Section, High Court, Chennai 104. GV(CO) SR/5.2.2009 CMA No. 4095 of 2008 https://hcservices.ecourts.gov.in/hcservices/