FA/271/1994 1/7 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD FIRST APPEAL No. 271 of 1994 With CIVIL APPLICATION No. 15437 of 2007 In FIRST APPEAL No. 271 of 1994 For Approval and Signature: HONOURABLE MR.JUSTICE D.H.WAGHELA ========================================================= 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ========================================================= EXECUTIVE ENGINEER(MECH) & 1 - Appellant(s) Versus SMT. PUSHPABEN CHANDRAKANT W/O. CHANDRAKANT VITHALDAS & 6 - Defendant(s) ========================================================= Appearance : MR SUNIL K SHAH for Appellant(s) : 1 - 2. None for Defendant(s) : 1, 1.2.3, 6, MR YOGESH S LAKHANI for Defendant(s) : 1.2.1,1.2.2 RULE SERVED for Defendant(s) : 4, MR SHALIN N MEHTA for Defendant(s) : 5, ========================================================= CORAM : HONOURABLE MR.JUSTICE D.H.WAGHELA Date : 15/02/2008 ORAL JUDGMENT 1. While deciding the first Civil Application No.641 of 1994 made in the present appeal, the Division Bench of this Court (Coram: FA/271/1994 2/7 JUDGMENT B.N. Kirpal, C.J.(as His Lordship then was) and R.K. Abichandani, J.) observed as under: “We heard the counsel for the applicants. No one represents the Insurance Company. On the merits of the case, we find that the judgment is well-considered and calls for no interference. But, the only question, which would really arise for consideration at the stage of hearing of the appeal, would be with regard to apportionment of liability between the applicants and respondent No.5, the Insurance Company. It is the case of the appellant that respondent No.5 should be liable at least to the extent of Rs.50,000/-. The amount awarded is Rs.4,90,000/-, plus interest at the rate of 15% per annum form the date of petition till the date of realisation. The applicants should deposit the amount awarded minus a sum of Rs.50,000/- and proportionate interest on that sum of Rs.50,000/-. This deposit should be made within four weeks from today and respondent No.5 should also deposit the balance decretal amount, with interest, within four weeks of the service on them of a copy of this order. The observations made in this order are only for the purpose of stay and shall not be taken into consideration at the time of hearing of the appeal. Application stands disposed of.” FA/271/1994 3/7 JUDGMENT 2. Assailing the impugned judgment and award dated 14.12.1993 of M.A.C.T.(Main), Jamnagar in Claim Case No.193 of 1983, learned counsel Mr.S.K. Shah submitted that the insurance company, respondent No.5 herein, was required to be saddled with the liability to the extent of Rs.50,000/- in terms of the policy of insurance and the quantum of compensation was required to be reduced by applying multiplier lower than 15 in view of the age of 35 years of the deceased at the time of accident. He also pointed out that the Tribunal was pleased to award interest at the rate of 15% on the amount of compensation, even as the claimant had claimed interest at the rate of 12%. It was also pointed out that while the Tribunal had itself come to the conclusion that the deceased could have contributed Rs.30,000/- per year to the claimants, it had based its calculation on yearly dependency benefit of Rs.36,000/-. Therefore, it was, on that basis, submitted that the quantum of compensation was on the higher side and required to be suitably modified. Learned counsel relied upon Division Bench judgment of this Court in Jethabhai Bhimabhai & others V/s. Mer Pola Rina & others [1996(2) G.L.H. 434] to submit that the proper multiplier would have been 12 in the case where the deceased was aged 35 years. Learned counsel also relied upon judgment of the Supreme Court in FA/271/1994 4/7 JUDGMENT Kaushnuma Begum and others V/s. New India Assurance Co.Ltd. and others [2001 ACJ 428] in support of the submission that interest was required to be reduced to 9%. In that judgment, it was observed that, earlier, 12 per cent was found to be the reasonable rate of simple interest; but, with a change in economy and the policy of the Reserve Bank of India, the interest rate has been lowered. The nationalised banks are now granting interest at the rate of 9 per cent on Fixed Deposits for one year. Therefore, it was directed that interest at the rate of 9 per cent per annum should be paid to the appellants in the facts of that case. 3. Learned counsel Mr.Shalin Mehta, appearing for respondent No.5, the insurance company, fairly conceded that the liability of insurance company was required to be increased to the extent of 50,000/- in view of the express provisions of Section 95 of the erstwhile Motor Vehicles Act, 1939. 4. Learned counsel Mr.V.G. Dave, appearing with learned counsel Mr.Y.S. Lakhani, submitted that the appeal was not required to be entertained merely for the purpose of varying the rate of interest, particularly in the circumstances that after the accident that FA/271/1994 5/7 JUDGMENT happened in 1983, the amount of compensation was awarded in 1993 and it was disbursed or invested in terms of the orders of the Court. It was further submitted that the Tribunal and the Court had taken judicial notice of revision of pay- scales and assured prospects in service in case of Government servants like the deceased in the present case. He submitted that the Tribunal was properly justified in assessing the dependency benefits at 36,000/- a year in view of the fact that the deceased was holding office of Deputy Executive Engineer at Porbandar Port at the relevant time and was the only breadwinner leaving behind the widow and two young children aged 11 and 7. It was also submitted that the deceased could have served till his retirement age and even thereafter, he would have been entitled to pension and hence, the application of higher multiplier was justified in the facts and circumstances of the case. 5. Since there is no dispute about the basic facts of the case and liability to the extent of Rs.50,000/- has been accepted by respondent No.5, the appeal has to be partly allowed. As for the contentions regarding reduction of the amount of compensation, as discussed in the impugned award, the deceased could have served up to the year 2004 while the accident occurred in the year 1983 FA/271/1994 6/7 JUDGMENT and his pay would have been revised in the scale of Rs.2200-4000 with effect from 01.01.1986. Therefore, even disregarding the claim of monthly amount of Rs.8527/-, as in the year 2004, it was undeniable that the deceased was actually receiving Rs.1500/- per month and in view of the subsequent revision of pay-scale, average dependency benefit came to Rs.9,000/- which was halved to arrive at the dependency benefit of Rs.4500/- per month and one third of that amount was deducted towards personal expenses of the deceased. Thus, the figure of monthly dependency benefit of Rs.3000/- and yearly figure of 36,000/- was based upon conservative calculation and sound reasoning which requires no interference. As for the application of multiplier and the rate of interest, the Tribunal has relied upon judgment of this Court prevailing at that time and in view of entitlement of the deceased to post-retiral benefits and in view of the rate of inflation and prevailing rates of interest on Fixed Deposits at the relevant time, it would be unjust and unreasonable to reduce the amount of compensation or the rate of interest in the peculiar facts of the case. As recently held by the Supreme Court in Abati Bezbaruah V/s. Dy. Director General, Geological Survey of India and another [AIR 2003 SC 1817], the rate of interest on the amount of compensation is in the FA/271/1994 7/7 JUDGMENT discretion of the Tribunal and it ought not to be interfered with. 6. In the facts and for the reasons discussed hereinabove, the appeal is partly allowed with the direction that the appellant shall be liable to pay only Rs.4,50,000/- and respondent No.5-New India Assurance Company shall be liable to pay Rs.50,000/- by way of compensation to the original claimants. The impugned order shall stand modified to the aforesaid extent without disturbing the remaining part of the order. The appeal is accordingly partly allowed with no order as to costs. Civil Application No.15437 of 2007 does not survive and stands disposed as rejected. (D.H.WAGHELA, J.) Hitesh