IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 27.11.2008 CORAM THE HONOURABLE MR.JUSTICE R.SUDHAKAR C.M.A.No.2319 of 2008 The Divisional Manager, The New India Assurance Co.,Ltd., 8, 2nd Floor, J.N.Street, Pondicherry. .. Appellant/2nd Respondent vs. 1.Thulasi 2.Susithra(Minor) 3.Priyanka(Minor) Gandhimathi (Minor petitioners 2 and 3 rep. by Mother and NF 1 respondent) 5.Anarkali (5th respondent exparte in lower court Notice may be dispensed with) ...Respondents/ Petitioners & 1st Respondent Civil Miscellaneous Appeal is filed under Section 173 of Motor Vehicles Act, 1988 against the Judgment and decree in MCOP.NO.1056 of 2006 dated 31.03.2008 on the file of the Motor Accidents Claims Tribunal District Court, Pondicherry. For appellant : Mr.N.Ismail for Mr.N.Vijayaraghavan For respondents 1 to 4 : Ms.S.Geetha for M/s G.Dyearany Om Prakash JUDGMENT The New India Assurance Company is on appeal challenging the award in MCOP.NO.1056 of 2006 dated 31.03.2008 on the file of the Motor Accidents Claims Tribunal District Court, Pondicherry. 2. It is a case of fatal accident. The accident in this case happened on 19.6.2006. The deceased Babu aged about 43 years, a Collection Agent in REPCO Bank, Puducherry was travelling in a TVS Moped on Mahatma Gandhi Road, when he was hit by a lorry bearing Regn.No.PYT- 815 insured with the present appellant and in that accident, he suffered grievous injury and died at Government General Hospital, Pondicherry. The wife aged 35 years, two minor daughters aged 12 and 7 years and https://hcservices.ecourts.gov.in/hcservices/ mother aged 65 years are the claimants. They claimed a sum of Rs. 15 lakhs as compensation stating that the income of the deceased was Rs.10,000/- per month. 3. In support of the claim petition, the wife of the deceased was examined as P.W.1,. One Selvamani, an eye witness was examined as P.W.2. One Sundaramoorthy, Assistant Manager, REPCO Bank,Puducherry was examined as PW3. EXs. A1 to A55 were marked. Ex.A.1 is the Photocopy of First Information report dated19.6.2206 (Cr.No.483/06) issued by the Traffic Police Station,Pondicherry marked through PW1, EX.A2 is the Photo copy of Insurance Certificate for vehicle No. PYT 815 issued by 2nd respondent, marked through PW1, Ex.A3 is the Photocopy of Accident Inspection Report dated 19.6.2006 issued by Assistant Motor Vehicles Inspector, Pondicherry marked through PW1, Ex.A4 is the Photocopy of disposal of Dead body issued by Government General Hospital, Puducherry marked through PW1, Ex.A5 is the Photocopy of Medico legal Postmortem examination Report of Babu dated 23.6.2006 issued by Government General Hospital, Puducherry marked through PW1, Ex.A6 is the Certified copy of Judgment dated 8.6.2007 passed in O.S.NO.1752 of 2006 by the I Additional Ditrict Munsif Puducherry, marked trough PW1, Ex.A7 is the Certified copy of Decree dated 8.6.2007 passed in O.S.No.1752 of 2006 by the I Additional District Munsif, Puducherry marked through PW1, Ex.A8 is the Photo copy of 1st page of Family Ration card of the petitioners dated 15.7.2005 marked through PW1, Ex.A9 is the Photo copy of Driving licence of Babu issued by Asst.Licensing Authority, Pondicherry marked through PW.1, Ex.A10 is the Authorisation letter dated 15.11.2007 given by Senior Chief Manager of REPCO Bank Ltd., Pondicherry Branch to PW3- Sundaramoorthy marked through PW3 Ex.A11 is the Statement regarding payment of commission to the deceased for the period from April 2005 to June 2006 issued by REPCo Bank ltd., Pondicherry Branch marked through PW3. Ex.A12 is the Certificate dated 10.9.2007 to show the nature of service of deceased Babu in Repco Bank ltd., issued by Senior Chief Manager, marked through PW3, Ex.A13 is the copy of Form No.16A for deduction of income-tax for march 2006 for deceased Babu issued by Repco Bank Ltd., marked through PW3, Ex.A14 is the copy of Appointment order (Proceedings) dated 22.4.1998 of Babu as Daily Deposit Collector on contract basis issued by Managing Director REPCO Bank ltd., Madras marked through PW3. EX.A15 is the report of joining duty of Babu issued by Branch Manager REPCo Bank, Puducherry marked through PW3, Ex.A16 to Ex.A29 are for payment of commission and other recovery of REPCO Bank ltd., Puducherry for the period from April 2005 to May 2006 marked through PW3, Ex.A30 to Ex.A41 are Vouchers for receipt of commission by Babu for the period from April 2005 to March 2006, through PW3. Ex.A42 to Ex.A54 are copies of Form No.16A for deduction of income-tax for the period April 2005 to August 2005. October 2005 to February 2006 and April 2006 to June 2006 for the salaries paid to the deceased Babu issued by REPCO Bank Ltd., marked through PW3, EX.A.55 is the Statement of Accounts of deceased Babu issued by REPCO Bank Ltd for the period from 1.4.2005 to 31.3.2006 marked through PW3.No oral or documentary evidence was let in on behalf of the appellant Insurance Corporation. https://hcservices.ecourts.gov.in/hcservices/ 4. The finding of the Tribunal with regard to negligence on the part of the driver of the Lorry who is responsible for the accident and the death and consequential liability fixed on the appellant Insurance Corporation to compensate the claimants 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 issue relating to compensation was decided from paragraph 10 onwards in answer to Point No.2. In support of the income, PW3, who was the Manager, REPCO Bank, Puducherry was examined and EX.A1 to A55 were marked as exhibits. The details of the commission given to the deceased were marked through Ex.A16 to 29. The income tax details have been furnished under Exs.A42 to 54 and Ex.A13. From Ex.A11 the statement of commission particulars, the Tribunal noticed that the income earned by the deceased through commission was between Rs.6,875/-to Rs.10,332/- from April 2005 to June 2006. On that basis, a sum of Rs.8,500/- was fixed as total income and some amount was deducted as tax and the net income was stated to be Rs.7,750/- per month. 7. The income from Commission arrived is Rs.7750/-. The Tribunal considering the future prospects ,fixed the income of the deceased at Rs.8,000/- . Based on the decision of the Apex Court in Uttar Pradesh State Road Transport Corporation Vs. Trilok chandar reported in 1996-II Law Weekly, 226, by adopting unit method, a sum of Rs.2200/- was deducted towards personal expenses of the deceased and the contribution to the family was stated to be Rs.5,800/- Accordingly the annual loss to the appellants works out to Rs.5800 x 12 = Rs.69,600/-. The deceased was aged about 43 years which is supported by Ex.A5 Postmortem Certificate and the driving licence Ex.A9. The Tribunal, adopted Multiplier of 15 in terms of second schedule to Motor Vehicles Act granted the compensation as follows: Sl. No. Head Amount granted by the Tribunal 1 Loss of income (Rs.69,600 x 15) Rs.10,44,000/- 2 Funeral Expenses Rs. 5,000/- 3 Loss of consortium to wife,1st petitioner Rs. 25,000/- 4 Loss of Love and Affection for two minors Rs.20,000/- each Rs. 40,000/- 5 Mental agonyto the mother of the deceased Rs. 10,000/- 6 Transportation charges Rs. 1,000/- Total Rs.11,25,000/- The tribunal awarded 7.5% interest. https://hcservices.ecourts.gov.in/hcservices/ 8. The only contention of the learned counsel for the appellant is that the multiplier of 15 is on the higher side. He prayed for reduction in quantum of compensation granted. 9. Counsel for the respondents on the other hand pleaded that the deceased had 17 years of service and his income will increase in the future. The reduction in the multiplier and quantum will affect the welfare of the minor children. Considering these aspects, the compensation is just and reasonable and need not be reduced. He further stated that reasonable compensation should be granted for loss of love and affection to the children and enhanced compensation should be granted to the wife towards loss of consortium. 10. The income of the deceased determined by Tribunal though disputed by the counsel for the appellant does not require to be reduced by this Court as it is supported by several documents. The income of the deceased had been fixed after thorough discussion and proper reasoning. Taking into consideration the future prospects as well. Therefore, the same does not merit reduction on modification. The only question that can be considered in this case is Multiplier adopted. 11. 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 has given certain parameters as to how the multiplier should be fixed. Paragraph 11 of the said decision is extracted hereunder: "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 https://hcservices.ecourts.gov.in/hcservices/ 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 departure from which can only be justified in rare and extraordinary circumstances and very exceptional cases. 12. Considering the lumpsum that accrues to the dependents on the death of the 43 years old breadwinner at this point of time and also taking note of the fact that the marginally higher amount has been taken as income considering the future prospects of the deceased as well, the multiplier stands reduced to 13 as against 15 and therefore, the award stands modified as follows:- Sl.No. Head Amount granted by the Tribunal Amount granted by this Court 1 Loss of income Rs.10,44,000/- Rs.9,04,000/- 2 Funeral expenses Transport expenses Rs. 5,000/- Rs. 7,500/- 3 Loss of consortium Rs. -------- Rs. 20,000/- 3 For loss of love and affection to two minor children Rs.20,000 x 2 Rs. 40,000/- Rs. 40,000/- 4 For loss of love and affection to mother Rs. 10,000/- Total Rs.11,25,000/- Rs.9,81,500/- The interest awarded at 7.5% stands confirmed as the accident in this happened in the 2006 and the award passed in 2008. 13. It is stated that by order dated 1.8.2008, the appellant has deposited entire amount. https://hcservices.ecourts.gov.in/hcservices/ 14. In the result, the Civil Miscellaneous Appeal is allowed in part as follows: (i) The award of the Tribunal is reduced to Rs.9,81,500/-from Rs.11,25,000/- (ii) The interest granted by the Tribunal at 7.5% is confirmed. (iii) The claimants are entitled to the award amount as ordered by this Court as follows:- Wife/first claimant Rs.4,81,500/- with proportionate interest and entire cost as awarded by the Tribunal. Minor daughters/claimants 2 and 3 (Rs.2,00,000/-each) Rs.4,00,000/- with proportionate interest Mother/fourth claimant Rs.1,00,000/- with proportionate interest (iv) The mother of the deceased, 4th respondent/4th claimant is permitted to withdraw the amount as mentioned above less the amount already withdrawn by her. (v) The share of the minor respondents 2 and 3/claimants 2 and 3 shall be invested in any nationalised bank proximate to the 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 minors is permitted to withdraw the accrued interest in respect of the share 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 on the same branch and the interest amount shall be transferred to the account to be maintained by the mother. (vi) The nationalised bank to which the amount will be deposited, shall intimate to the first respondent/first claimant of such deposit and confirm the same to the Tribunal that the first claimant has been duly informed. The Tribunal to instruct the bank accordingly. (vii) 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. (viii) The appellant insurance company is entitled to withdraw the balance amount in deposit with accrued interest after settling the claimants. (ix) There will be no order as to cost. https://hcservices.ecourts.gov.in/hcservices/ (x) Consequently connected Miscellaneous petition is closed Sd/- Asst. Registrar. /true copy/ Sub Asst. Registrar. VJY To 1. Motor Accidents Claims Tribunal ( District Court), Pondicherry. + 1 CC to Mr.N.Vijayaraghavan,Advocate,SR.67168 + 1 CC to M/s.G.Dyearany Om Prakash,Advocate,SR.66919 C.M.A.No.2319 of 2008 RSM(CO) EM/12.2.09 https://hcservices.ecourts.gov.in/hcservices/