1 BEFORE THE MADURAI BENCH OF MADRAS HIGH COURT DATED : 27.10.2010 CORAM THE HONOURABLE MR.JUSTICE P.P.S.JANARTHANA RAJA C.M.A.(MD)No.1541 of 2010 The General Manager, Tamil Nadu State Transport Corporation, Karaikudi. .. Appellant/Respondent Vs. 1.Mariammal 2.Minor Divya (Minor rep.through her mother and next friend, 1st respondent herein). .. Respondents/Petitioners Appeal filed under Section 173 of the Motor Vehicles Act, 1988 against the judgment and award made in MCOP No.63 of 2005 dated 10.01.2006 on the file of the Motor Accidents Claims Tribunal, Principal District Court, Ramanathapuram. For Appellant : Mr.D.Sivaraman for M/r.Rajnish Pathiyil JUDGMENT The appeal is preferred by the Transport Corporation against the judgment and award made in MCOP No.63 of 2005 dated 10.01.2006 on the file of the Motor Accidents Claims Tribunal, Principal District Court, Ramanathapuram. 2. Background facts in a nutshell are as follows: The deceased-Elango met with motor traffic accident that took place on 15.02.2004 at about 10.50 a.m. The said deceased travelled in a bus belonging to the appellant / Transport Corporation, bearing Registration No.TN-63-N-0613 as a Conductor-on-duty, from Theni to Sivagangai. When the said bus was nearing Nakkalapatti Village, the driver drove the bus in a rash and negligent manner and hit against a tree. Due to the said impact, the bus turned turtle and the deceased sustained head injury and also multiple injuries all over the body. Immediately he was taken to the hospital and he died in the hospital. The claimants are the wife and minor daughter of the deceased. They claimed a compensation of Rs.9,63,000/- before the Tribunal. The appellant-Transport Corporation resisted the claim. On pleadings, the Tribunal framed the following issues:- 1. Whether the accident had occurred due to the rash and negligent driving of the driver of the bus? https://hcservices.ecourts.gov.in/hcservices/ 2 2. Whether the claimants are entitled to compensation? If so to what extent?" 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 sum of Rs.5,03,600/- as compensation with interest at 7.5% p.a. from the date of petition. The details of the compensation are as under:- Rupees Loss of income 4,83,600/- Loss of consortium 5,000/- Funeral expenses 5,000/- Loss of love and affection 10,000/- ------------ Total.... 5,03,600/- ============ Even though the Tribunal has awarded Rs.5,03,600/- as total compensation, the Tribunal has taken note of the fact that the appellant / Transport Corporation already granted a sum of Rs.1,00,000/- to the claimants. Therefore, the Tribunal held that the Transport Corporation is entitled to deduct a sum of Rs.1,00,000/- from the award amount of Rs.5,03,600/-. But in the decree, by mistake, it is stated as Rs.5,03,600/- as against Rs.4,03,600/-. It is a mistake. The correct amount after deduction is Rs.4,03,600/- only. Aggrieved by that award, the appellant / Transport Corporation has filed the present appeal. 3. Learned counsel for the appellant/Transport Corporation questioned only the quantum of compensation awarded by the Tribunal and submitted that the compensation awarded by the Tribunal is excessive, exorbitant and without any basis and justification. Hence the order passed by the Tribunal is not in accordance with law and the same should be set aside. 4. Heard the learned counsel for the appellant and perused the materials available on record. On the side of the claimants, the wife of the deceased was examined as P.W.1 and documents Exs.P1 to P4 were marked. On the side of the Transport Corporation, no witness was examined and no document was marked. Ex.P1 is the certified copy of the F.I.R. Ex.P2 is the certified copy of Post Mortem Report of the deceased. Ex.P3 is the Death Certificate. Ex.P4 is the Salary Certificate. 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 belonging to the appellant / Transport Corporation. It is a question of fact and it is based on valid materials and evidence, and hence the same is confirmed. 5. In the case of SARLA VERMA AND OTHERS VS. DELHI TRANSPORT CORPORATION AND ANOTHER reported in (2009) 4 MLJ 997, the Apex https://hcservices.ecourts.gov.in/hcservices/ 3 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 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 https://hcservices.ecourts.gov.in/hcservices/ 4 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: "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 https://hcservices.ecourts.gov.in/hcservices/ 5 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) 6. 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 contemporary society ‘would deem to be a fair sum such as would allow the wrongdoer to hold up his head among https://hcservices.ecourts.gov.in/hcservices/ 6 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 https://hcservices.ecourts.gov.in/hcservices/ 7 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. 7. The age of the deceased was 45 years old at the time of accident. P.W.1, in her evidence, has stated that the deceased was earning a sum of Rs.7120.45 per month. She further stated that only the driver of the bus caused the accident and the driver was charge-sheeted by Usilampatti Taluk Police Station in Crime No.29 of 2004 under Sections 279, 337 and 304(A) IPC. Ex.P4 is the Salary Certificate, in which it is stated that the salary of the deceased was Rs.4087/-. Further it is stated that the retirement date of the deceased was 30.04.2017. The Tribunal, after taking into consideration of the same and also taking into consideration that the deceased would have received batta, bonus and also increment, fixed the monthly income at Rs.5,300/-. Out of the said sum, the Tribunal deducted Rs.300/- towards miscellaneous expenses since the deceased was travelling in a long route bus, and arrived at a sum of Rs.5000/- which the deceased would have contributed to the family. Thereafter, the Tribunal fixed 5 units for the family of the deceased, i.e. 2 units for an adult and 1 unit for a child, including the deceased and after deducting 2 units for the deceased, for the remaining 3 units, the Tribunal has fixed Rs.1,000/- per unit and accordingly calculated the loss of monthly income at Rs.3,000/- and arrived at the annual income at Rs.36,000/-. After taking into consideration that the deceased would have certainly worked for 13 years more, the Tribunal adopted the multiplier of 13 and arrived at the loss of income at Rs.4,68,000/- (Rs.36,000/- x 13). After taking into consideration that the deceased was used to receive Rs.2000/- as bonus, the Tribunal was of the view that for the remaining service of 13 years, he would have received Rs.26000/- towards bonus. Out of the said sum of Rs.26000/-, the Tribunal deducted Rs.10,400/- on the basis of the unit method and the balance sum of Rs.15,600/- was taken as the contribution of the deceased to the family with regard to bonus. Thereafter, the Tribunal added this sum of Rs.15,600/- to Rs.4,68,000/- and arrived at the total loss of income at Rs.4,83,600/-. The Tribunal has correctly taken the monthly income https://hcservices.ecourts.gov.in/hcservices/ 8 and also correctly determined the annual income and also adopted the correct multiplier of 13 as per unit method and arrived at Rs.4,68,000/- towards loss of income. The amount awarded towards this head is also very reasonable and hence the same is confirmed. The Tribunal has awarded Rs.5000/- towards loss of consortium, Rs.5000/- towards funeral expenses and Rs.10,000/- towards loss of love and affection. The amounts awarded towards these heads are very reasonable and hence the same are confirmed. The Tribunal has awarded 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 the prevailing rate of interest during the relevant period, this Court is of the view that the interest rate fixed by the Tribunal at 7.5% p.a. from the date of petition is very reasonable and hence the same is confirmed. After awarding the compensation at Rs.5,03,600/-, the Tribunal has taken note of the fact that the Transport Corporation has already awarded Rs.1,00,000/- to the claimants of the deceased. Therefore, the Tribunal has correctly held that a sum of Rs.1,00,000/- has to be deducted from the award amount of Rs.5,03,600/-, but in the decree, by mistake, it is stated that the amount is Rs.5,03,600/-. The correct amount is Rs.4,03,600/- with interest at 7.5% p.a. from the date of petition. Learned counsel for the appellant / Transport Corporation, fairly stated that the claimants filed E.P. in which the amount has been correctly stated as Rs.4,03,600/- with interest at 7.5% p.a. from the date of petition. I do not find any error or illegality in the order of the Tribunal so as to warrant interference. The findings given by the Tribunal are based on valid materials and evidence. It is a question of fact and it is not a perverse order. Therefore, the award passed by the Tribunal is in accordance with law and hence the same is confirmed. 8. Under the circumstances, the appellant /Transport Corporation is directed to deposit a sum of Rs.4,03,600/- with interest at 7.5% p.a. from the date of petition, less the amount if any already deposited, within a period of eight weeks from the date of receipt of a copy of this order. It is also stated that E.P. is pending. Taking into consideration the facts and circumstances of the case, there shall be an order of stay of the operation of the order of the Tribunal passed in MCOP No.63 of 2005 dated 10.01.2006, till the expiry of the 8 weeks period as stated above. If no amount is deposited on or before the stipulated period mentioned above, the stay granted shall automatically stand vacated. On deposit of the above said amount, the wife of the deceased, the first respondent herein, is permitted to withdraw her share on making proper application. In respect of the share of the minor, the same shall be deposited in a fixed deposit in a Nationalised Bank under Reinvestment Scheme till the minor attains majority. The first respondent/ mother of the minor is permitted to withdraw the accured interest from the bank, on making proper application. 9. It is also stated by the counsel for the appellant / Transport Corporation that the bus bearing Registration No.TN-63-N-1055 belonging to the Transport Corporation has already https://hcservices.ecourts.gov.in/hcservices/ 9 been attached in E.P.No.3 of 2009, by the District Court, Ramanathapuram. In view of the stay granted above, the attachment of the bus shall be released forthwith. 10. The Civil Miscellaneous is devoid of merits and it is not a fit case for admission and accordingly the same is dismissed. Consequently, M.P.(MD)No.3 of 2010 is closed. No costs. Sd/- Assistant Registrar(P&A) /True Copy/ Sub Assistant Registrar To The Principal District Judge, Motor Accidents Claims Tribunal, Ramanathapuram. +1cc to Mr.Rajnish Pathiyil, Advocate SR.No.43506 KM akm/02.11.10 /9p-3c/ C.M.A.(MD)No.1541 of 2010 27.10.2010 https://hcservices.ecourts.gov.in/hcservices/