IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED:13.04.2010 CORAM: THE HON'BLE MRS.JUSTICE R.BANUMATHI AND THE HON'BLE MR.JUSTICE M.VENUGOPAL C.M.A.NO.3135 of 2006 The New India Insurance Co.Ltd., The Branch Manager No.106, Big Street Vasavi Building Thiruvannamalai .... Appellant/2nd Respondent Vs. 1.Munian 2.Pownammal 3.Anjalidevi 4.Santhosh Kumar 5.Vanathi 6.Sujatha 7.Sudha devi 8.Minor Sathish Kumar (3rd Respondent/Petitioner is the guardian and next friend) 9.R.B.Suresh Babu .... Respondents/ (R9 Given up) I to VIII Petitioners and and 1st Respondent Prayer: Civil Miscellaneous Appeal filed under Section 173 of Motor Vehicles Act, 1988 against the award and decree dated 29.8.2003 made in M.C.O.P.No.255 of 2002 on the file of Motor Accident Claims Tribunal (Principal Subordinate Judge, Tindivanam) For Appellant : Mr.J.Chandran For Respondents : Mr.M.Santhanaraman for RR1 to 8 JUDGMENT (Judgment of the Court was made by R.BANUMATHI,J.) In this appeal, Appellant/Insurance Company challenges the judgment of the Tribunal in M.C.O.P.No.255 of 2002 on the file of Motor Accident Claims Tribunal (Principal Subordinate Judge, https://hcservices.ecourts.gov.in/hcservices/ Tindivanam), whereby the Tribunal has awarded Rs.13,89,200/- for the death of Selvam, Village Administrative Officer. The claimants are the wife, sons, daughters and parents of deceased Selvam. 2. The brief facts are that on 9.1.2002 at 18 hours when the deceased was riding the motor cycle TN 32 Y 8723 from Gingee to Tindivanam, Hero Hondo motor cycle bearing Regd.No.TN 32 V 0466 came in the opposite direction from Tindivanam to Gingee, near Vadavanoor Kootu road and dashed against the motor cycle, which the deceased was riding. The deceased fell down from his vehicle and sustained multiple injuries. He was admitted in the Government Hospital, Gingee, where he succumbed to the injuries. Regarding the accident, a criminal case was registered in Crime No.11 of 2002 on the file of Gingee Police Station under Section 304(A) IPC against the rider of the vehicle bearing Regd.No.TN 32 V 0466. The deceased Selvam was working as Village Administrative Officer and was getting salary of Rs.7,000/- per month. Alleging that the accident was due to rash and negligent driver of the rider of the vehicle bearing Regd.No.TN 32 V 0466, the Claimants have filed claim petition claiming compensation of Rs.15,00,000/-. 3. Resisting the Claim Petition and alleging the negligent driving of the rider of the vehicle and also putting the owner of the vehicle to the strict proof as to the possession of valid driving licence, the Insurance Company has filed the counter. The Appellant Insurance Company has also raised objection as to the age and salary of the deceased and claiming that the quantum of compensation claimed in the Claim Petition was on the higher side. 4. Before the Tribunal, On behalf of the Claimants, the 4th Claimant – son of the deceased examined himself as P.W.1. Eye witness – Raja alias Rajaram was examined as P.W.2 and Exs.P.1 to P.9 were marked. No oral or documentary evidence was adduced on behalf of the Appellant. 5. Upon consideration of oral and documentary evidence, the Tribunal held that the accident was due to rash and negligent driving of the driver of the vehicle bearing Regd.No.TN 32 V 0466 and that the owner of the vehicle and Appellant Insurance Company are jointly and severally liable to pay the compensation. 6. Insofar as the quantum, Selvam was working as Village Administrative Officer and was getting salary of Rs.6,969/-, the Tribunal has taken the income at Rs.6,900/- per month. Observing that the deceased was aged 39 years, the Tribunal has adopted multiplier 16 and calculated loss of dependency at Rs.8,83,200/-. Again, taking the income of the deceased at Rs.4,615/ (Basic Pay – Rs.4,400 + Personal Pay – Rs.215/-), Tribunal has once again adopted multiplier 16 and after deducting 1/3rd for personal expenses the Tribunal has arrived at Rs.3,30,000/- as compensation for future prospects and https://hcservices.ecourts.gov.in/hcservices/ accordingly the Tribunal awarded total compensation of Rs.13,89,200/- as under: Loss of dependency : Rs. 8,83,200/- Loss of consortium : Rs. 34,000/- Loss of love and affection : Rs. 1,00,000/- for 5 children Loss of love and affection : Rs. 40,000/- for parents Future prospects : Rs. 3,30,000/- Funeral expenses : Rs. 2,000/- --------------- Total : Rs. 13,89,200/- ---------------- 7. Learned counsel for the Appellant Mr.Chandran contended that there are suspicious circumstances in registering the F.I.R. by Station House Officer, Gingee/ lodging of the complaint by the son of the deceased and the delay in inspection of both the vehicles by the Motor Vehicles Inspector nearly 50 days after the accident raised a serious doubt about the involvement of the vehicle. Drawing our attention to the plan prepared by the Investigating Officer in Crime No.11 of 2002, the learned counsel for the Appellant – Insurance Company submitted that the plan would indicate involvement of a lorry – TNA 1966 and while so the two wheeler - Hero Honda TN- 32 V – 0466 has been brought into picture merely to make a fabricated claim against the Insurance Company. Insofar as the quantum, the learned counsel for the Appellant contended that the Tribunal went wrong in awarding Rs.8,83,200/- for loss of dependency and again awarding Rs.3,30,000/- for future prospects. Insofar as the conventional damages also, the learned counsel for Appellant contended that the amount awarded for conventional damages is very much on the higher side. 8. We have heard the learned counsel for the Claimants. The learned counsel for the claimants contended that the Insurance Company did not examine eye witnesses nor adduced any evidence to sustain the grounds now raised in the Appeal. The owner-cum-rider of the two wheeler - TN. 32 V 0466 has also admitted the offence in the criminal case registered against him. It is a strong circumstance indicating the involvement of the two wheeler. Ex.P.4 is the charge sheet filed in Cr.No.11 of 2002. It was further contended that when the 9th Respondent – owner of the vehicle has been given up it is not open to the Appellant - Insurance Company to raise the question as to the involvement of the vehicle as well as the negligence. 9. Insofar as the first Contention regarding the involvement of the vehicle, the learned counsel for the Appellant contended that in https://hcservices.ecourts.gov.in/hcservices/ the initial stages of F.I.R. and investigation, the vehicle involved was simply stated as Vehicle TN 32 V 0466 and nowhere it was indicated that it was a Hero Honda two wheeler. Drawing our attention to the plan, learned counsel further contended that as per the plan, only lorry was shown to be involved. Learned counsel for the Appellant - Insurance Company would further contend that P.W.1 - 4th Claimant – Santhosh Kumar himself lodged complaint and that he was not an eye witness and while so the recitals in the F.I.R. cannot be taken as the conclusive piece of evidence to hold the involvement of the Hero Honda two wheeler - TN 32 V 0466. The learned counsel would further contend that if really the two wheeler was involved in the accident, the investigating officer would not have prepared the plan in Cr.No.11 of 2002 indicating the involvement of the lorry. Even though the Appellant – Insurance Company now raises the plea of denial of Hero Honda Motor cycle - TN 32 V 0466, it is pertinent to note that the same plea was not raised in the counter. By perusal of the counter, it is seen that the Appellant – Insurance Company has raised the plea only regarding the quantum, coverage of police, driving licence of the rider of the vehicle - TN 32 V 0466 and also the negligent driving of the vehicle. Nowhere in the counter the Appellant- Insurance Company has raised the plea of non-involvement of the two wheeler - TN 32 V 0466 and also the allegations of fabricated claim. 10. Where the Appellant – Insurance Company makes serious allegations of fabricated claim and denying the involvement of the vehicle, the burden lies upon the Insurance Company as well as the owner of the vehicle. If the Appellant – Insurance Company raises doubts regarding the collusion between the claimants and the owner of the vehicle, the Appellant/Insurance Company ought to have obtained permission under Rule 170 of the Motor Vehicles Rules and ought to have adduced evidence. By perusal of the records, the Appellant/Insurance Company does not seem to have obtained any permission. In fact, the Appellant Insurance Company has not adduced any oral or documentary evidence raising the plea of denial of involvement of the two wheeler Hero Honda - TN 32 V 0466. In the absence of any substantive evidence adduced by the Appellant- Insurance Company, it is not possible for us to consider the merits of the contentions now raised by the learned counsel for the Appellant. As rightly contended by the learned counsel for the claimants, Appellant – Insurance Company did not examine any witnesses nor adduced evidence to sustain the grounds now raised in the appeal. In the absence of any foundation being laid either by way of pleadings or by adducing evidence, the contention of the Appellant/Insurance Company raising the plea of denial of involvement of the vehicle TN 32V 0466 cannot be gone into. 11. Upon analysis of the evidence of P.W.2 – eye witness and Ex.P.1 – F.I.R. -Tribunal has rightly held that the accident was due to the rash and negligent driving of the Hero Honda motor cycle TN https://hcservices.ecourts.gov.in/hcservices/ 32V – 0466. The coverage of the Insurance Policy is not in dispute. In such view of the matter, the Tribunal rightly held that the 9th Respondent – owner of the vehicle and also the Appellant – Insurance Company are jointly and severally liable to pay the compensation to the claimants. 12. The 1st and 2nd Claimants are the father and mother of deceased Selvam. The 3rd Claimant is wife of deceased Selvam. 4th and 8th Claimants are the sons of deceased. 5Th, 6th and 7th Claimants are the daughters of the deceased. At the time of accident, deceased Selvam was working as Village Administrative Officer and was earning Rs.7,000/- per month as salary. In his evidence, P.W.1 - 4th Claimant has stated that his father was working as Village Administrative Officer and was earning Rs.7,000/- per month. Ex.P.7 is the salary certificate, from which it is seen that the gross salary of the deceased was Rs.6,969/- per month and after deductions, his take home salary was Rs.3,290/-. The Tribunal has taken the monthly income at Rs.6,900/- and after deducting 1/3rd for personal expenses, i.e.,Rs.27,600/-, calculated the loss of dependency at Rs.55,200/- per annum. Observing that the deceased was aged 39 years at the time of accident, the Tribunal has adopted multiplier 16 and calculated the total loss of dependency at Rs.8,83,200/-. 13. The learned counsel for the Appellant contended that even though the deceased was getting salary of Rs.6,969/- after deductions of Rs.3,679/-, his net salary was only Rs.3,290/- and while so the Tribunal ought not to have taken Rs.6,900/- as the salary for calculating the loss of income. Section 168 of the Motor Vehicles Act used the word "just compensation", which in our opinion, should be assigned a broad meaning so as to compensate the claimants. The deductions towards G.P.F., G.P.F.loan refund, family benefit fund and other deductions cannot be taken as the deductions. Giving a liberal interpretation of "income", we are of the view that the gross salary of the deceased ought to be taken and not his take home salary. 14. Holding that income is not confined to pay-packet only in National Insurance Company Limited Vs. Indira Srivatsava and others (2008) 2 SCC 763, Supreme Court has held as under: "9. The term “income” has different connotations for different purposes. A court of law, having regard to the change in societal conditions must consider the question not only having regard to pay-packet the employee carries home at the end of the month but also other perks which are beneficial to the members of the entire family. Loss caused to the family on a death of a near and dear one can hardly be compensated on monetary terms. 10. Section 168 of the Act uses the word “just compensation” which, in our opinion, should be assigned a broad meaning. We cannot, in determining the issue involved in the matter, lose https://hcservices.ecourts.gov.in/hcservices/ sight of the fact that the private sector companies in place of introducing a pension scheme take recourse to payment of contributory provident fund, gratuity and other perks to attract the people who are efficient and hard-working. Different offers made to an officer by the employer, same may be either for the benefit of the employee himself or for the benefit of the entire family. If some facilities are being provided whereby the entire family stands to benefit, the same, in our opinion, must be held to be relevant for the purpose of computation of total income on the basis whereof the amount of compensation payable for the death of the kith and kin of the applicants is required to be determined. .... 19. The amounts, therefore, which were required to be paid to the deceased by his employer by way of perks, should be included for computation of his monthly income as that would have been added to his monthly income by way of contribution to the family as contra distinguished to the ones which were for his benefit. We may, however, hasten to add that from the said amount of income, the statutory amount of tax payable thereupon must be deducted." 15. Addition to income for future prospects: After calculating the loss of dependency at Rs.81,83,200/-, the Tribunal proceeded to award the compensation of Rs.3,30,000/- for future prospects. For arriving at the said amount, Tribunal has taken the basic pay at Rs.4,400/- and personal pay at Rs.215/-, totalling Rs.4,615/-. The deceased was getting dearness allowance of Rs.1984/-, H.R.A. - Rs.220/-, Medical benefit – Rs.50/- and F.D.A. - Rs.100/-, totalling Rs.6,969/-. Pointing out that deceased being aged 39 years and that he would have worked for another 18 years, the Tribunal has taken basic pay of Rs.4,400/- plus personal pay ofRs.215/- i.e., Rs.4,615/- and calculated the annual income at Rs.55,380/-. Again, adopting the multiplier 18, Tribunal has arrived at Rs.9,96,840/-. The Tribunal has taken 1/3rd of the said amount and arrived at Rs.3,30,000/- as the compensation for future prospects. 16. In our considered view, the approach adopted by the Tribunal in again taking the basic pay plus personal pay at Rs.4,615/- and again adopting multiplier 18 and thereafter quantifying 1/3rd of income at Rs.3,30,000/- is erroneous. Having taken the income at Rs.6,900/- per month and after adopting multiplier 16 and after calculating the loss of dependency, the Tribunal was not right in again taking the income at Rs.4,615/- per month and adopting multiplier 18 and again calculating the income at Rs.9,96,840/- and taking 1/3rd of it i.e, Rs.3,30,000/- as compensation for future prospects. In our considered view, such approach adopted by the Tribunal is nothing but granting the total benefit to the claimants. Coming to the question as to what is the income of the deceased to be taken into account, as per Ex.P.7 – salary certificate, the deceased was getting salary of Rs.6,969/-. After implementation of 6th Pay https://hcservices.ecourts.gov.in/hcservices/ Commission, the deceased would have got more salary and he would have had further increments also. Having regard to the future prospects and the revision of pay scales and other future prospects, the income of the deceased is taken as Rs.8,000/- per month, which comes to Rs.96,000/- per annum. 17. Deduction for personal expenses: - The Tribunal has adopted 1/3rd deduction for personal expenses. Placing reliance upon the decisions of Supreme Court in NATIONAL INSURANCE COMPANY LTD. VS. KHIMLIBAI AND OTHERS (2009(5) CTC 187) and SARLA VERMA AND OTHERS VS. DELHI TRANSPORT CORPORATION AND ANOTHER (2009 INDLAW SC 488) , learned counsel for the claimants contended that the family of the deceased consisted of parents, five children and wife and as per the ratio laid down in the above decisions, the Tribunal ought to have deducted only 1/4th towards personal expenses leaving expenses of the deceased and deducting 1/3rd for personal expenses appears to be on the higher side. Learned counsel for the claimants urged before us that since there are number of dependants in the family, deducting 1/4th for personal expenses would be appropriate. 18. In FAKEERAPPA VS. KARNATAKA CEMENT PIPE FACTORY ((2004 (2) SCC 473), while considering the appropriateness of 50% deduction towards Personal and Living Expenses of the deceased, the Supreme Court has held that what would be the percentage of deduction for personal expenses cannot be governed by any rigid rule or formula of universal application and it would depend upon circumstances of each case. In the said decision, the Supreme Court has restricted the deduction towards personal expenses to 1/3rd of the income. 19. In number of decisions, the Supreme Court has taken the consistent view that 1/3rd deduction should be made for personal expenses. In BILKISH VS. UNITED INDIA INSURANCE CO.LTD. ((2008) 4 SCC 259), the Supreme Court has taken the view that deceased would have spent one-third towards personal use and the contribution two-third of his income to his family. Indisputedly, deduction of one-third towards personal expenses is ordinary rule in India. The deceased Selvam was working as Village Administrative Officer. In his capacity as Village Administrative Officer, necessarily, he has to travel to various places in and around the village and he would have spent more amount for him. Going by the standards and also keeping in view the nature of avocation of the deceased, in our considered view, deduction of 1/3rd for personal expenses is reasonable and the 1/3rd deduction can be made for personal expenses. 20. Choice of multiplier: In the impugned judgment, the Tribunal has taken the age of the deceased Selvam as 39 years and based upon the S.S.L.C.Book, the Tribunal has taken the date of birth as 13.6.1962. By careful perusal of the documents produced by the claimants, it is seen that the S.S.L.C. Book was not at all produced before the Tribunal. Ex.P.8 is the School Transfer Certificate of the https://hcservices.ecourts.gov.in/hcservices/ deceased Selvam from which it is seen that his date of birth is 13.4.1952. The date of accident was 9.1.2002 which means that at the time of accident the deceased was aged 49 years 8 months. Going by the II Schedule, for the age group of 45 years and above, but not exceeding 50 years, 13 is the appropriate multiplier. Since the deceased was aged 49 years, the appropriate multiplier to be adopted is 13. 21. Coming to the question of loss of dependency/pecuniary loss to the family, since deceased was aged 49 years, he would have been in service till he attains 58 years. After deducting 1/3rd for personal expenses i.e.,Rs.2,650/, the contribution to the family would be Rs.5,350/- per month. At the age of 58 years, the deceased would have attained superannuation. Therefore, for the entire multiplier period of 13, the contribution to the family at Rs.5,350/- per month cannot be taken. Since the deceased would have been in service for a period of nine years, loss of dependency for a period of nine years is calculated at Rs.5,350 x 12 x 9 = Rs.5,77,800/-. For the remaining period of 4 years, the deceased would have retired from service. After his retirement, the contribution of the deceased is taken as 50 percent. The net income of the deceased is taken as 50 percent of Rs.8,000/- i.e., Rs.4,000/- after deducting 1/3rd personal expenses i.e., Rs.1,333/-, the contribution to the family would be Rs.2,666/- rounded off to Rs.2,670/-. The loss of dependency for the remaining 4 years is Rs.2,670 x 12 x 4 = Rs.1,28,160/-. The total loss of dependency/pecuniary loss is calculated at Rs.5,77,800/- + Rs.1,28,160/- = Rs.7,05,960/-. 22. Insofar as the conventional damages, Tribunal has awarded Rs.34,000/- for loss of consortium, Rs.1,00,000/- for loss of love and affection to 3 daughters and 2 sons and Rs.40,000/- for loss of love and affection to the parents, Rs.2,000/- for funeral expenses. In our considered view, the quantum of compensation awarded for conventional damages is quite reasonable warranting no interference. 23. Accordingly, the total compensation amount awarded to the Claimants is reduced to Rs.8,81,960/-. The reduced compensation amount has to be apportioned amongst the Claimants in the same ratio of apportionment as ordered by the Tribunal. Insofar as the interest, the Tribunal has awarded interest at the rate of 9 percent. Since there are number of claimants, and the accident was in the year 2002, in the facts and circumstances of the case, we are not inclined to interfere with the rate of interest and the rate of interest at 9 percent awarded by the Tribunal has to be confirmed. 24. In the result, the quantum of compensation awarded by the Tribunal in M.C.O.P.No.255 of 2002 on the file of the Principal Subordinate Judge, Tindivanam is reduced to Rs.8,81,960/-, which is to be apportioned amongst the Claimants as the same ratio of apportionment as ordered by the Tribunal and payable with interest at https://hcservices.ecourts.gov.in/hcservices/ the rate of 9 percent. As per the order of the Court, dated 8.11.2006, the Appellant/Insurance company has deposited 75 percent of the award amount together with interest accrued thereon and the claimants were also permitted to withdraw 1/3rd of the compensation amount awarded to them. If any further amount is payable by the Appellant Insurance Company, the Appellant Insurance Company shall deposit the same within a period of eight weeks from the date of receipt of copy of the judgment. The claimants are permitted to withdraw the balance compensation amount payable to them. The 8th claimant – Sathish Kumar, who was then minor at the time of filing the Claim Petition, appears to have attained the majority and after obtaining necessary orders from the Tribunal, 8th Claimant is also permitted to withdraw the compensation amount awarded to him. The appellant Insurance Company is permitted to withdraw the excess amount, if any, lying in the credit of M.C.O.P.No.255 of 2002, The counsel for the claimants is entitled to fee of Rs.20,892/- Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar usk To The Motor Accident Claims Tribunal -Prl.Subordinate Judge, Tindivanam 1 cc To Mr.M.Santhanaraman, Advocate, SR.25128 C.M.A.No.3135 of 2006 JSV(CO) sra 7/06/2010 https://hcservices.ecourts.gov.in/hcservices/