IN THE HIGH COURT OF SIKKIM GANGTOK Regular Firs_t Ar)Deal No.01 of 2009 New India Assurance Company Ltd. Barick Bhawan, 4th Floor, 8 C.R.Avenue, Kolkata 700072 Through the Senior Branch Manager, New India Assurance Company Ltd. Gangtok Branch, Sikkim. Versus 1. Nakul Gurung, S/o Late Mahendra Gurung, R/o Upper Sichey, below T.N.S.S. School, P.O.& P.S.Gangtok, East Sikkim. 2. Najalj Rai, W/o Shri Nakul Gurung, R/o Upper Sichey, below T.N.S.S. School, P.O.& P.S.Gangtok,. East Sikkim. 3. Md. M. Burhanuddin Khan, S/o Late Md. Alimuddin, R/o Lilong Haoreibi Turel Ahanbi, P.O. & P.S, Liong, District Imphal, Manipur -795001. Appellant Respondents FOR THE APPELLANT : MR. A. K. UPADHYAYA, SENIOR ADVOCATE WITH MR. ASHIM CHEITRI, ADVOCATE. FORTHE RESPONDENT : MR. K. T. BHUTIA, SENIOR ADVOCATE NOS.1 AND 2 WITH MR. DINESH AGARWAL, ADVOCATE. FORTHERESPONDENT : NONE NO.3 Date of last hearinq : 17.08.2009 Date of Judmment : 24.08.2009 PRESENT ; THE HON'BLE MR. JUSTICE SONAM P. WANGDI_, JUDGE JUDGMENT S.P.Wanad_iL,1 This appeal is directed against the impugned judgment passed in M.A.C.T.Case No.21 of 2006 dated 10.09.2007 by the Learned Member, Motor Accident Claims Tribunal, East and North Sikkim at Gangtok, awarding the claimants death compensation of Rs.7,72,500.00 with interest @ 10 per annum from the date of filing of the claim petition, 2, Briefly stated, the facts of the case are that one Kuldeep Gurung died in a motor accident on 30.09.2005 at Traffic Stand, North AOC NH 39, Imphal, Manipur, at around 8.40 p.in. when the vehicle, a canter bus, in which he was travelling, dashed on the traffic stand due to the rash and negligent driving of the driver plying the canter bus, causing the death of the said Kuldeep Gurung and another person named Prasan Pradhan on the spot. Apart from the deceased persons, 15 others also were injured and were evacuated to RIMS Hospital and Raj Poly Clinic, North AOC for medical treatment. It appears that the deceased was one of the 17 badminton players representing the State of Sikkim in a tournament that was being held at D. M. College in Manipur. a The unfortunate accident took place on 30.09.2005 as the players were returning from D. M. College to Khuman Lampak aboard the ill-fated bus after participating in the tournament. Claim for compensation under Section 166 of the Motor Vehicles Act, 1988 for Or7 \ 3D the death of the deceased Kuldeep Gurung was preferred before the Ld. Motor Accident Claims Tribunal, East Sikkim at Gangtok, by the father and mother of the deceased who are the respondents No.1 and 2 herein. The claim was resisted by the appellant, New India Assurance Co. Ltd. before the learned Tribunal as the respondent No.2. The respondent No.1, one Md. M. Burhanuddin Khan, the owner of the vehicle. was proceeded ex-parte having failed to appear despite notice by substituted service. In the written objection that was filed on behalf of the appellant as the respondent No.2, all objections available under the law were taken. Apart from denying the accident having taken place, the appellant disputed the claim made by the claimants that the deceased was a bright student and a sports person, In fact the appellant denied the very existence of both statutory liability and its contractual obligation to pay compensation to the claimants or to indemnify the owner of the vehicle. It appears that in support of their claims, the claimants/respondents had examined two witnesses and exhibited as many as 11 documents. Claimant No.1 examined himself as Pwl and one Shri Samir Gurung, as PW2 who was a co-passenger in the ill-fated vehicle on the day of the accident. The appellant herein chose not to adduce any evidence. On the basis of the pleadings of the parties, the learned Tribunal framed just one issue which is as follows:- "Whether the claimants are entitled to the compensation and if so, to what extent ?" Cfu %\ r}J After considering the pleadings of the parties and the evidence available in the records which included the documents exhibits 1 to 11, the learned Tribunal decided the issue in favour of the claimants, i,e., the respondents herein, and awarded Rs.7,72,500,00 as compensation by the impugned judgment dated 29.08.2007. Before this Court the appellant seeks to assail the said impugned order primarily on the ground that the deceased being a non-earning person prior to the accident, his income ought to have been computed by strictly following the second schedule to the Motor Vehicles Act, 1988. It was the case of the appellant that fixing the notional income of the deceased at Rs.6,000.00 per month was based on mere surmises and conjectures when it ought to have been rational and arrived at by following a judicious approach. At the time of the arguments, Mr. A. K. Upadhyaya, learned Senior Advocate, appearing on behalf of the appellant, submitted that it is a well established position of law that the second schedule ought to be followed while awarding compensation under the Act against death and injuries. It has been laid down by various decisions of the Supreme Court that even in cases under Section 166 of the Motor Vehicles Act, 1988 the multipliers provided in the second schedule to the Motor Vehicles Act, 1988 ought to be followed as guidelines, even though that schedule does not relate the to the claims under Section 166. Mr. Upadhyaya relied upon the case of Uni-fed India Insurance Co.Lld. vs. Patricia Jean Mahajan and Others C6,\ '}-+ reported in /ZOOL2/ G J5lcc' 28Z in which it has been held that it is for the Tribunal to arrive at an amount of compensation, which it may consider to be just in the facts and circumstances of the case and that the structured formula as provided under the second schedule would be a safe guide to calculate the amount of just compensation and further, that deviation though permissible may only be resorted to for some special reasons so to do. Mr. Upadhyaya also referred to and strongly relied upon a Division Bench judgment of this Court in the case Of Branch Manager, National Insurance Co.Lld. vs. Pavitra Chettri and Another rapcfrferd .in AIR (2007) Sikkim 1.in which TrfuJhe need and importance of adhering to schedule 11 of the Motor Vehicles Act and the guidelines laid down by the Hon'ble Supreme Court, keeping in view the desirability of maintaining uniformity and certainty of awards that may be passed by tribunals laid down in various I.udgments of this Court, more specifically the common judgment in the c;HSR!s Of United India Insurance Company Limited vs. Chandi Rai and Another alnd National Insurance Co. Itd. Vs. Bijay Kumar Sharma and Another re!porterd in AIR (2006) Sikkim 1, was emphasised. Mr. Upadhyaya laid considerable stress on paragraph 8 of the judgment and upon the extract of paragraph 15 of the judgment in the case of Bijay Kumar Sharma and Another (supra) which is reproduced hereinbelow for the sake of convenience :- ``So far as the question of adhering to Second Schedule to the Motor Vehicles Act, 1988 is concerned, Mr. Upadhyaya relied on two decisions of a Single Bench (headed by one of us, namely, A. P. Subba, J.) of this Court rendered in M.A.C. Appeal No.1 of 2005 Gopi Krishna Kakrania & another v. Mahendra Pradhan & another and M.A.C. Appeal No.2 of 2005 car 3;i Gopi Krishna Kakrania & Another v. Mahendra Pradhan & Another, disposed of by a common judgment dated 18th May, 2005 (reported in AIR 2006 (NOC) 48 (sik)) and in M.A.C. Appeal No.2 of 2004 United India Insurance Company Limited v. Chandi Rai & Another and M.A.C. Appeal No.3 of 2004 National Insurance Company Ltd. V. Bijay Sharma and Another also disposed of by common judgment dated 26th May, 2005 (reported in AIR 2006 Sik 11). In both the above judgments, the need and importance of adhering to Schedule 11 of the Motor Vehicles Act and the guidelines laid down by the Honb'le Supreme Court keeping in view the desirability of maintaining uniformity and certainty of awards that may be passed by the Tribunals was emphasized. In the common judgment dated 15th May, 2005 it was categorically observed that while computing just compensation, the Tribunals must adhere to the system of multiplier not only to ensure fair compensation, but also to ensure certainty and uniformity of the awards that may be passed in similar cases. In Paragraph 15 of the judgment it was observed as follows :- ``15. Thus keeping in view the fact that the schedule 11 brought into existence by the 1994 Amendment would be a safe legislative guidelines for determining just compensation both in fault claim cases as well as in no fault claim cases and also keeping in view the observation of the Hon'ble Supreme Court in Trilok Chandra's case (supra) that the multiplier method if followed will ensure uniformity and certainty of awards to be made by the Tribunals, the importance and desirability of adhering to the second schedule of the Motor Vehicles Act and the guidelines laid down by the Hon'ble Supreme Court in this regard cannot be over emphasized. It thus follows that there can be no departure from the scheduled multiplier in the present cases so as to ensure fair compensation and uniformity and certainty of the awards in similar cases ....... " It was submitted that the learned Tribunal had committed grave error in determining the income of the deceased at Rs.6,000/- per month, as there was no rationale behind such determination and was arrived at most arbitrarily on mere surmises and conjectures amounting to a conclusion arrived at on the basis of whims and wild guesses and arbitrariness. Referring to the case of Sfafe of #ar]ra"a awdr Another vs. Jasbir Kaur and Others reperferd in (2003) 7 SCC 4!gL4, it was submitted that the Tribunal while awarding compensation cir ought to have been just and reasonable, the determination of which has to be rational, arrived at by following a judicious approach. In that case, it was held in paragraph 7 as follows :- ``7. It has to be kept in view that the Tribunal constituted under the Act as provided in Section 168 is required to make an award determining the amount of compensation which is to be kept in the real sense ``damages" which in turn appears to it to be ``].ust and reasonable''. It has to be borne in mind that compensation for loss of limbs or life can hardly be weighed in golden scales. But at the same time it has to be borne in mind that the compensation is not expected to be a windfall for the victim. Statutory provisions clearly indicated that the compensation must be ``just" and it cannot be a bonanza; not a source of profit; but the same should not be a pittance. The courts and tribunals have a duty to weigh the various factors and quantify the amount of compensation, which should be just. What would be ``just" compensation is a vexed question. There can be no golden rule applicable to all cases for measuring the value of human life or a limb. Measure of damages cannot be arrived at by precise mathematical calculations. It would depend upon the particular facts and circumstances, and attending peculiar or special features, if any. Every method or mode adopted for assessing compensation has to be considered in the background of ``just" compensation which is the pivotal consideration. Though by use of the expression ``which appears to it to be just" a wide discretion is vested in the Tribunal, the determination has to be rational, to be done by a judicious approach and not the outcome of whims, wild guesses and arbitrariness. The express ``just" denotes equitability, farness and reasonableness, and non-arbitrary, If it is not so it cannot be just." r5ee #e/en C, Ae4e//a v. Maharashtra SRTC.) It was submitted by Mr. Upadhyaya that the respondents have not been successful in proving the assertion that the academic record of the deceased was brilliant and that at the time of death he was a student of tender age having no income of his own. In any case, taking the age of the deceased as a determining factor for calculating the future income of the deceased was erroneous, when it has been laid down that it ought to have been the age of the parents which should in fact have been taken into consideration for the purpose. To cfr cS)S` 3i 8 support this contention, Mr. Upadhyaya relied upon the cases of „ew India Assurance Co. Ltd. Vs. Satender and Others rapc]rferd .in (2006) 13 SCC 60 arid Ramesh Singh and Another vs, Satbir Singh and Another re!porferd .in (2008) 2 SCC 667. I:n prarirqraph 9 of the' judgment in the case of Satender and Others (supra) it has been held as follows :- ``9. There are some aspects of human life which are capable of monetary measurement, but the totality of human life is like the beauty of sunrise or the splendor of the stars, beyond the reach of monetary tape-measure. The determination of damages for loss of human life is an extremely difficult task and it becomes all the more baffling when the deceased is a child and/or a nonreaming person. The future of a child is uncertain. Where the deceased was a child, he was earning nothing but had a prospect to earn. The question of assessment of compensation, therefore, beco`mes stiffer. The figure of compensation in such cases involves a good deal of guesswork. In cases, where Darents are claimants, relevant factor rwould be aae of Darents." (under/ining supplied ). Similarly, in paragraph 6 in the case of Ramesh Singh (supra), it has been laid down that the choice of multiplier is determined by the age of the deceased or the claimants whichever is higher. For convenience, relevant portion of paragraph 6 reads as under :- ``6. We have given anxious consideration to these contentions and are of the opinion that the same are devoid of any merits. Considering the law laid down in Wew J#c/y.a As54/ra„ce Cb.£fd. i6. Cy7a//.e it is clear that the choice of multiiDlier is determined bv the aae of the deceased or the claimants whichever is hiqher ............ " /unc7e//.r7/.„g swfxp//.ec/J. On the other hand, Mr. K. T. Bhutia, learned Senior Advocate appearing on behalf of the respondents submitted that the question of strict application of schedule 11 of the Motor Vehicles Act would arise only if claims are made under the provisions of Section ¢ta` \ 163-A of the Motor Vehicles Act, 1988. Since the claim had been preferred under Section 166 of the Act, it was upon the Tribunal to assess the compensation in exercise of its discretion available under Section 168 thereof. It has been further submitted that no formula of the kind provided under schedule 11 for the purpose of a claim petition under Section 163-A of the Motor Vehicles Act, 1988 has been laid down for determination of compensation in a claim petition under Section 166 of the said Act. It was further submitted that there was no bar for the Court in taking the second schedule as a guiding factor, but it cannot be used as an invariable ready reckoner for determination of just compensation under the Act. In support of this contention, Mr. K. T.PJrfurfua roferred to TulJa c;frseof Syed Basheer Ahamed and Others v, Mohd. Jameel and Anotherrapcfrferd-in 2009 ACJ Ggo. Paragraphs 9, 10 and 11 of which are reproduced for convenience :- ``9. Section 168 of the Act enjoins the Tribunal to make an award determining the amount of compensation which appears to be ]-ust'. However, the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression twhich 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 the settled principles relating to determination of compensation. 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 compensatiion, The determination of comDensation must be based on certain data, establishina reasonable nexus between the loss incurred bv the dependants of the deceased and the comDensation to be awarded to them. In nutshell, the amount of compensation determined to be Davable to the claimant(sl has to be fair and reasonable bv accepted lecial standards. cD ``5 -a. ®S` 3= 10 cO. I:n General Manager, Kerala state Roads Trans. Corpn. V. Susamma Thomas, T9f34 A/C] I (S/I), M. N. Venkatachaliah, J„` (as His Lordship then was) had observed that 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 his neighbours and say with their approval that he has done the fair thing''. The amount awarded must not be niaaardlv since the `law values life and limb in a free society in Generous scales'. At the same time, a misplaced svmDathv, aenerositv and benevolence cannot be the quidinci factor for determinina the compensatiion. The object of providing compensatiion 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. 11. As noted earlier, in the matter of computation of compensation, there is no uniform rule or formula for measuring the value of a human life. Thouah a sDecial Provision for assessment of comDensation on structured formula basis for the DurDose of a claim DetiTlon under section 163-A of the Act has been inserted in the Act w.e.f. 14.11.1994, but no such formula has been laid down for determination of compensation in a claim Detitiion under section 166 of the Act, thouah there is no bar in takina the said Schedule as a auidina factor while determininq the iust compensation bv aDDlvina multiDlier method. In fact, in Managing Director, Tamil Nadu State Trans. Corpn. Lid. V. K. J. E/r7c/u, 2006 ACJ 423 (SC), it has been observed that the Ssecond Schedule to the Act may serve as a guide but cannot be used as an invariable ready-reckoner. In a catena of decisions of this court, certain broad principles which could be applied for assessing ].ust compensation have been highlighted. It has been observed that in a fatal accident action, the accepted measure of damages awarded to the dependants is the pecuniary loss suffered and likely to be suffered by them as a result of abrupt termination of life. The question as to what factors should be kept in view for calculating the pecuniary loss to a dependant came up for consideration before a three-Judge Bench of this court in Gobald Motor Service [rd. Vs. R.M.K. Ve/uswami, T9f/RI-C;EI AIC] 179(SC), with reference to a case under the fafa/ Acc:rlder7ts Act,1855, wherein, K. 54/bba Aao, J. (as His Lordship then was) speaking for the Bench observed thus: ``In caloulating 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 balanci.ng on the one hand the loss of 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 dependent by the death must be ascertained." / er7xpAas/.5 Swfzf}//.ec/J cfty . •: -``!=- It was, therefore, contended by Mr. Bhutia that the learned Tribunal had not committed any error in determining the future income of the deceased in the manner it has done. It was further submitted that while doing so, the learned Tribunal had relied upon the evidence on record, more particularly the statements of the witnesses and the exhibits 4, 5 and 7, which lend credence to the claim that the deceased had a sound academic record and that he had good prospects of achieving fame and money as a sportsperson. 9. Rjcterrirng to TheJ caise of I(ader Kunju and Anothervs. Maheshwaran Pada Nair and Others raportfrd -in (2000) 1 TAC 20L2 rsc/, it was submitted that, in that case, the facts of which were similar as the instant one in as much as the age of the victim was 17 years and that of the parents 47 and 45 years respectively, application of multiplier of 16 provided in the second schedule to the Act was held to be reasonable. Since in the present case also, the learned Tribunal had applied 16 as the multiplier where the age of the deceased was 17 and that of the parents 44 and 43 years respectively, no error or illegality had been committed by it. A number of decisions of High Courts on that point were also cited, which in my view, is unnecessary being repetitive and mostly based upon the peculiar facts and circumstances obtaining in those cases. ZO, On the above premises, Mr. K. T. Bhutia, learned Senior Advocate, supported the award of compensation vide the impugned judgment and prayed for dismissal of the appeal as being not ifi „ r--- - 12 maintainable. Replying to the submissions made on behalf of the respondents, Mr. A. K. Upadhyaya, learned Senior Advocate, while reiterating his stand made earlier, submitted that the learned Tribunal while applying the multiplier system in schedule 11 of the Motor Vehicles Act, 1988 had committed an error in applying 16 as the multiplier which ought to have been 13. This submission to me, appeared to be quite curious as it was the case of the appellant all along that the learned Tribunal did not adhere to schedule 11, which ought to have been done in view of the law laid down in various judgments of the Hon'ble Supreme Court as well as our own Court, some of which have been referred to and extracted above. His submission provided a different dimension to the entire case, in as much as, the submission that the learned Tribunal had not applied the second schedule for determination of the compensation stood abandoned and the only question that remained for determination was as to which of the multiplier between 16 and 13 would be applicable in the facts and circumstances of the case. ZZ, Before dealing with the controversy raised in the case, I feel it essential to put on record certain unpalatable features noticed in matters relating to claims under Motor Vehicles Act. It has been regrettably noticed that the insurance companies invariably as a matter of routine contest claims made by the victims and/or their representatives irrespective of whether the objections raised by them as the basis of such contests are valid and sustainable at all or not. The Motor Vehicles Act, 1988 has taken the present shape and form ifi with the change in the character of states as welfare states. The history and development of this statute has been well analysed in a Division Bench judgment of the Gauhati High Court in the case of United India Insurance Co. Itd. Vs. H. Lalhmingliana and AAof]ter reported in 2007 r2/ 734C 942 rGau,J. In this regard specific reference may be made to paragraphs 9 to 35 of the judgment. The source of such analysis and inspiration has been and drawn from the various decisions of the Supreme Court in which the necessity of transforming the Motor Vehicles Act from its earlier character to the present one has been emphasized in order to achieve the object of social ].ustice. I have