IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 11.12.2008 CORAM THE HONOURABLE MR.JUSTICE R.SUDHAKAR C.M.A.No.3858 of 2008 and M.P.NO.1 of 2008 The Managing Director Tamil Nadu State Transport Corporation Limited Tiruchirappalli .... Appellant/Respondent vs. 1.Rani 2.Sivakolunthu 3.Chinnathambi ... Respondents/Petitioners Civil Miscellaneous Appeal is filed under Section 173 of Motor Vehicles Act, 1988 against the award dated 25.07.2007 passed in MCOP.No.320 of 2005 on the file of the Motor Accidents Claims Tribunal and Additional District Judge (Fast Track Court) Ariyalur. For appellant : Ms.B.Vijayalakshmi JUDGMENT The Transport Corporation is on appeal challenging the award dated 25.7.2007 passed in MCOP.No.320 of 2005 on the file of Motor Accidents Claims Tribunal and Additional District Judge (Fast Track Court) Ariyalur. 2. It is a case of fatal accident. The accident in this case happened on 12.07.2004. The deceased Ramasamy, 33 years old working as a mason was walking on the main road when he was hit by appellant transport corporation bus driven by its driver in a rash and negligent manner and in that accident, he suffered grievous injuries and died. His wife aged about 30 years, mother and father aged about 55 and 60 years respectively filed a claim for compensation in a sum of Rs.19 lakhs stating that the income of the deceased was Rs.6,000/- https://hcservices.ecourts.gov.in/hcservices/ per month. 3. In support of the claim, the wife was examined as PW1 and one Minor was examined as PW2. Exs.A1 to A4 were marked. Ex.A1 is the First Information Report, Ex.A2 is the Post-mortem certificate EX.A3 is the copy of legal heir certificate and Ex.A4 is the Death Certificate. The driver was examined as RW1. No document was marked on behalf of the appellant/respondent before the Tribunal. 4. The finding of the Tribunal with regard to negligence on the part of the driver of the bus as responsible for the accident and the death and the liability fixed on the appellant transport corporation bus to compensate the claimant is not in dispute and the same is confirmed. 5. The only contention raised by the learned counsel for the appellant is on the quantum of compensation. 6. The Tribunal decided the issue relating to compensation in answer to Point No.2. The age of the deceased was taken as 33 years as per the post mortem certificate and the person who gave the First Information Report clearly stated that the deceased was a mason and his income was Rs.200/- per day. The income of the deceased was fixed at Rs.3,000/- per month in the absence of specific documentary evidence. The contribution to the personal expenses of the deceased was fixed at Rs.1000/-.The contribition was taken as Rs.2,000/- p.m and the annual contribution was taken as Rs.24,000/- . The Tribunal adopted the Multiplier at 17 and fixed a sum of Rs.4,08,000/- (Rs.2000 x 12 x 17) as compensation towards pecuniary loss. In all, the Tribunal granted the following amount as compensation: Sl. No. Head Amount granted by the Tribunal 1 Loss of dependency Rs.4,08,000/- 2 Funeral Expenses Rs. 2,000/- 3 Transport expenses Rs. 2,000/- T otal Rs. 4,12,000/- The Tribunal awarded compensation at Rs.4,12,000/- with interest at 7.5 % p.a. 7. Learned counsel for the appellant pleaded that the 17 multiplier adopted in the case of deceased aged 33 years is excessive. Further, the wife alone can be said to be a dependent. Considering the lumpsum payment that will be made, the multiplier should be modified. He further contended that except the wife, mother and father are there no other dependents. There are no children and hence the compensation has to be as the multiplier should also be reduced. https://hcservices.ecourts.gov.in/hcservices/ 8.The choice of Multiplier has been emphazied by the Apex Court in General Manager, Kerala State Road Transport Corporation Vs. Susamma Thomas and others reported in (1194) 1 ACC 346 (SC) = AIR 1994 SC 1631. Paragraph 11 of the said decision is extracted here under: "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 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. 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 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 https://hcservices.ecourts.gov.in/hcservices/ 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' 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". In this case, though the multiplier is marginally high, the fact remains that the deceased was a mason by profession. Taking note of the period of accident, the income can be taken as Rs.4,500/- per month. If that be the case, then the claimants will get the higher compensation towards pecuniary benefits. Further, for funeral expenses and transport expenses, only Rs.2,000/- was granted and no amount has been granted for loss of consortium to the wife and loss of love and affection to the parents. Even the income of the deceased fixed is low as, it is not in tune with the inflation living wages and rise in price of commodities. Since no amount has been granted for loss of consortium and for loss of love and affection and a meagre amount has been granted for funeral expenses and transport expenses, the difference in amount by reducing the multiplier can be adjusted towards compensation on conventional heads.Therefore the quantum of compensation does not require further reduction, as also the interest at 7.5%, as the accident in this case happened in 2004 and award passed in the year 2005. 9. In the result, the Civil Miscellaneous Appeal is dismissed at the admission stage. There will be no order to costs. Learned counsel for the appellant seeks for eight weeks' time to deposit the entire https://hcservices.ecourts.gov.in/hcservices/ amount and the same is allowed and on such deposit, the claimants will be entitled to withdraw the amount in the same proportion as ordered by the Tribunal. Sd/ Asst.Registrar /true copy/ Sub Asst.Registrar VJY To 1.The Motor Accidents Claims Tribunal and Additional District Judge (Fast Track Court)Ariyalur. 2.The V.R.Section, High Court, Madras. 1 CC To Mr.B.Vijayalakshmi, Advocate, SR NO.69587 C.M.A.No.3858 of 2008 ka(co) pmk/3.3.2009. https://hcservices.ecourts.gov.in/hcservices/