FAO No. 2190 of 2011 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH FAO No. 2190 of 2011 Date of decision 20.12.2011 1. FAO No. 2190 of 2011 (in MACT No. 20 of 2009) National Insurance Co. Ltd. Appellant v. Subhash Chander Maini and Others Respondents 2. FAO No. 2191 of 2011 (in MACT No. 21 of 2009) National Insurance Co. Ltd. Appellant v. Subhash Chander Maini and Others Respondents CORAM: HON'BLE MR.JUSTICE JITENDRA CHAUHAN Present: Ms. Vandana Malhotra, Advocate for the appellant Mr. Kuldip Sanwal, Advocate for respondent Nos. 1 & 2 Mr. K.B.Raheja, Advocate for respondent No.3 .... JITENDRA CHAUHA,J. 1. This judgment shall dispose of two appeals ( FAO Nos. 2190 and 2191 of 2011) filed by the appellant-National Insurance Company against the Award dated 7.12.2010, passed by the Motor Accident Claims Tribunal, Ferozepur (for short the Tribunal) in two separate claim petitions- MACT Nos. 20 and 21 of 2009. 2. The facts are being extracted from FAO No. 2190 of 2011. 3. The claim petition No. 20 of 2009 was filed by Subhash Chander Maini and Sushila Maini, the parents of deceased Ajay Maini, FAO No. 2190 of 2011 2 who died in a motor vehicular accident on 4.4.2008. The claim petition was filed under section 166 of the Motor Vehicles Act, 1988 ( for short the Act). The facts of the case are that on 4.4.2008 at 2 a.m., deceased Ajay Maini alongwith his brother deceased Amit Maini was coming from Ludhiana to Fazilka in a Car bearing registration No. PB-22-B-0047. When they crossed village Tillu Arayian and reached near the brick kiln, a truck bearing registration No. RJ-13-GA-2096, came at a high speed and hit the car of Ajay Maini, as a result of the accident, both the occupants died on the spot. The accident was witnessed by Vijay Kumar Maini, Malkiat Singh, Advocates and Raman Papneja, who, in another vehicle were following the car of the deceased. FIR No. 65 dated 4.4.2008 was registered at Police Station, Guruharsahai on the statement of Vijay Kumar Maini. 4. Upon notice, respondent No.1, Baldev Singh, the driver-cum- owner of the truck, filed the written statement. He admitted the accident but denied any negligence on his part. He took the stand that the accident occurred due to the fault of the deceased, as the tyre of their car burst, as a result of which, the driver of the car lost control and struck against the truck, coming from the extreme left side of the road at a very slow speed. He also alleged false implication and denied the presence of any eye witnesses at the time of accident. 5. Respondent No.2, the Insurance Company denied the accident but admitted the registration of the case against respondent No.1, the driver of the truck. 6. From the pleadings of the parties, the following issues were framed ( in MACT No. 20 of 2009) :- FAO No. 2190 of 2011 3 1. Whether Ajay Maini died on 4.4.2008 in the motor vehicle accident in the area of village Tillu Arayian, P.S.Guruharsahi due to rash and negligent driving of Baldev Singh, respondent No. 1? OPP 2. Whether the claimants are entitled to compensation as claimed for if so, to what extent and from whom? OPP 3. Whether the claim application is false, frivolous and vexatious to the knowledge of the claimants? OPR 4. Whether the driver of the offending vehicle was not holding a valid and effective driving licence? OPR. 5. Relief. 7. The Ld. Tribunal decided Issue No. 1 in favour of the claimants and against the respondents. As per the statements of CW3, Vijay Kumar Maini and CW3 Malkiat Singh, on 4.4.2008 at 2 a.m, they were coming from Ferozepur to Fazilka. When they crossed Village Tillu Arayian and reached near a brick kiln, a truck bearing registration No. RJ- 13-GA-2096 came at a high speed and hit against the car bearing registration No. PB-22-B-0047, which was ahead of their vehicle. As a result of the accident, both the occupants of the car died on the spot. On the statement of Vijay Kumar Maini, FIR No. 65 dated 4.4.2008 was registered. The statements of these witnesses were duly corroborated by the facts mentioned in the FIR. These witnesses were cross examined at length by the respondents but their testimonies could not be shaken. On the other hand, respondent Baldev Singh, owner-cum-driver of the truck appeared in the witness box and stated that the vehicle was insured with the National Insurance Company. He stated that the car coming from the FAO No. 2190 of 2011 4 opposite side collided with the truck due to the bursting of the tyre of the car. The story of bursting of tyre of the car as projected by the driver of the truck is not corroborated by any other witness. The Ld. Tribunal relied upon the testimonies of the eye witnesses and decided this issue in the favour of the claimants. 8. While deciding Issue No. 2, the Ld. Tribunal has observed that as per the evidence produced on record, deceased Ajay Maini, was doing M .S (Orthopedic) from D.M.C. Ludhiana. He was getting Rs. 11,000/- per month as stipend. As per post mortem report, his age was 28 years. The Ld. Tribunal has taken into consideration the fact that the deceased was to appear in the examination for M.C.H in All India Institute of Medical Sciences, New Delhi, and he had the ability, talent and potential to earn as a successful doctor. The Ld. Tribunal has assessed his earning capacity at Rs. 18,000/- p.m. While computing the compensation, the Ld. Tribunal has taken into consideration the age of the claimants-parents of deceased Ajay Maini and applied the multiplier of 12 in this case. The total compensation of Rs. 17,28,000/- was awarded by the Tribunal to the claimants. All the respondents were jointly and severally held liable to pay the same. 9. While deciding Issue No.4, the Ld. Tribunal observed that the Insurance Company did not lead any evidence to prove that the driver of the truck was not holding a valid and effective driving licence at the time of the accident. Therefore, this Issue was decided against the respondent- Insurance Company. 10. The Ld. Tribunal framed similar issues in MACT No. 21 of 2009 filed for compensation regarding the death of Amit Maini in the same vehicular accident. FAO No. 2190 of 2011 5 11. Same findings, as in MACT No. 20 of 2009 were recorded as in MACT No. 21 of 2009 regarding Issues No. 1,3 and 4. While deciding Issue No.2, an amount of Rs. 16,80,000/- was awarded as compensation regarding the death of Amit Maini. 12. Aggrieved against the Awards dated 7.12.2010, the Insurance Company has preferred these two separate appeals. 13. Learned counsel for the appellant contended that the Ld. Tribunal has erred in not relying upon the statement of the driver of the truck. Respondent No.3 driver of the truck has taken specific defence in his written statement that no such accident occurred due to his rash and negligent driving. In fact the accident occurred due to the bursting of the tyre of the vehicle being driven by the deceased. 14. This contention of the appellant cannot be accepted, as the FIR in question was promptly lodged by the eye witnesses CW-2, Vijay Maini and CW-3, Malkiat Singh, who removed the deceased to the hospital. This fact is fully corroborated from the hospital record. Therefore, the version of the appellant-Insurance Company cannot be believed. There is no evidence, except the statement of driver-cum-owner Darshan Singh of the offending truck, which suggest that accident took place due to bursting of tyre and not in the manner stated by CW-2, Vijay Maini and CW-3, Malkiat Singh. The eye witnesses were not known to the respondents and they cannot be said to be having any animosity against the driver-cum-owner of the truck. Thus no fault can be found with the statements of these eye witnesses. The findings on Issue No.1 in both the cases are affirmed. 15. The next contention of learned counsel for the appellant is that FAO No. 2190 of 2011 6 the findings of the Ld. Tribunal on Issue No. 2 are not sustainable, as the deceased were not in any job at the time of the accident. He further argued that the Ld. Tribunal has wrongly assessed the income of Ajay Maini at Rs. 18,000/- per month and that of Amit Maini as Rs. 20,000/- p.m. 16. Learned counsel for the respondents states that the income assessed by the Ld. Tribunal is on the lower side. He asserts that the students doing house jobs after doing medical graduation degree get approx. Rs. 30,000/- per month. He submitted that the income of the deceased should be enhanced taking into consideration the future loss of income of the deceased. He further submitted that the multiplier applied by the Ld. Tribunal is as per law keeping in view the age of the dependent- claimants of the deceased. 17. The argument of learned counsel for the appellant is to be summarily rejected as deceased Dr. Ajay Maini was 26-1/2 years of age and was doing M.S (Orthopedic) from D.M.C. Ludhiana. He obtained the degree of Bachelor of Medicine and Bachelor of Surgery from Gujarat. He was getting Rs. 11,000/- as stipend and was to appear for M.C.H examination at All India Institute of Medical Sciences, New Delhi. 18. Even if the post graduate degree of M.S is ignored, the deceased was a highly qualified medical professional and it cannot be said that the income of Rs. 18,000/- assessed by the Ld. Tribunal is on the higher side. He had already been getting stipend of Rs. 11,000/-. From the statement of CW-4, Sh. D.D.Tirpathi, Executive Officer, D.M.C. Hospital, Ludhiana, who brought the record pertaining to Dr. Ajay Maini, the income of the deceased is fully established. 19. As per the record, Subhash Chander Maini, father of FAO No. 2190 of 2011 7 deceased is a practising lawyer. Otherwise also, the father cannot be held to be dependent on the income of the deceased. There is no dispute with regard to the fact that both the deceased were bachelors. The age of the mother of deceased is 59 years. She is a pensioner. The deduction of 1/3rd, towards personal expenses, from the income of the deceased is the ordinary rule in India. This view was taken by Hon'ble the Apex Court in Oriental Insurance Company Ltd. v. D.E.O. Patodi, 2009, Accident Claims Journal 2359 (Supreme Court) and Bilkish Versus United India Insurance Company Ltd. 2008, Accident Claims Journal, 1619 (Supreme Court). The Ld. Tribunal has also assessed the income of the deceased in the ratio of these judicial pronouncements. But, this Court is of the view that since the deceased was aged 26 years and unmarried, therefore 50% should be treated as the personal and living expenses of the bachelor. Similar view was taken in Shakti Devi v. New India Insurance Co. Ltd. And Anr. 2010(4) R.C.R (Civil) 950. In Para 12 of the judgment, it was observed as under:- “12. So far as the present case is concerned, at the time of accident, the deceased was 22 year old and not married. He was running a general store from his house and earning about Rs. 1000/- per month from the business. In Sarla Verma, this Court stated that where the deceased was self-employed, the court shall usually take only the actual income at the time of death; a departure from there should be made only in rare and exceptional cases, involving special circumstances. Does the present case involve special circumstances? In our view, it does. The evidence has come FAO No. 2190 of 2011 8 that the deceased was to get employment in the forest department after the retirement of his father. Obviously the evidence is based on the government policy. The deceased, thus, had a reasonable expectation of the government employment in near future. In the circumstances, the actual income at the time of deceased's death needs to be revised and taking into consideration the special circumstances of the case, in our view, the monthly income of the deceased deserves to be fixed at Rs. 2000/-. As regards the personal expenses, since the deceased was not married, we are satisfied that the principle stated in Sarla Verma that 50% should be treated as the personal and living expenses of the bachelor may be applied. Seen thus, the annual loss of dependency would come to Rs. 12,000/-. Insofar as multiplier is concerned, the Tribunal applied the multiplier of 8. Learned counsel for the appellant argued that the multiplier of 18 should have been applied keeping in view the age of the deceased. The argument is devoid of any substance. In a case where the age of the claimant is higher than the age of the deceased, the age of claimant and not the age of the deceased has to be taken into account for the capitalization of the lost dependency. It is so because the choice of multiplier is determined by the age of the deceased or that of the claimant, whichever is higher. The exact age of the claimant has not come on record. As per the evidence of AW1 (Pankaj Kumar Sinha), on the date of his deposition, the claimant's age was about 63 years. The date of FAO No. 2190 of 2011 9 deposition of AW-1 is not available. The accident occurred in 1991 and the date of decision of the Tribunal is June,2000. Ordinarily, the Tribunal would not have taken much time after the evidence was complete. We may assume that the statement of AW-1 was recorded somewhere in 1998 or 1999. If that be so, the age of the claimant on the date of the accident would be about 54-55 years. As per the table prepared in Sarla Verma, the multiplier of 11 would , therefore, be applicable. By multiplying the annual loss of dependency (Rs. 12000/-) with the multiplier of 11, the claimant becomes entitled to the compensation in the sum of Rs. 1,32,000/-. The compensation determined by the Tribunal at Rs. 60,000/- and confirmed by the High Court in appeal is manifestly erroneous and is enhanced to Rs. 1,32,000/-” 20. This Court is of the opinion that the dictum laid down in Sarla Verma and followed in Shakti Devi (supra), is applicable to the present case and hence 50% is deducted as personal and living expenses of the bachelor (in these cases, both the deceased were bachelors) as a bachelor tends to spend more on himself. 21. Now coming to the assessment of the income of the deceased. The deceased were getting stipend of Rs.18,000/- per month. No parameters like the price index and prevalent salary have been indicated by the Ld. Tribunal. Bereft of the above consideration, it can be safely stated that the income assessed is not on realistic consideration. The deceased, young aspirant doctors, would have earned approx. Rs. 40,000/-as initial salary, had they been alive. They were doing house jobs and were getting stipend. FAO No. 2190 of 2011 10 Stipend can not be termed as annual income of the deceased and on its basis the compensation cannot be fairly assessed. In Sarla Verma (Smt.) and Others v Delhi Transport Corporation and Another, 2009 (6) SCC 121, Hon'ble the Apex Court dealing with the question-Addition to income for future prospects, in paras 20 to 24 observed as under:- “20. Generally the actual income of the deceased less income tax should be the starting point for calculating the compensation. The question is whether actual income at the time of death should be taken as the income or whether any addition should be made by taking note of future prospects. 21.In Susamma Thomas this Court held that the future prospects of advancement in life and career should also be sounded in terms of money to augment the multiplicand (annual contribution to the dependants); and that where the deceased had a stable job, the court can take note of the prospects of the future and it will be unreasonable to estimate the loss of dependency on the actual income of the deceased at the time of death. In that case, the salary of the deceased, aged 39 years at the time of death, was Rs. 1032 per month. Having regard to the evidence in regard to future prospects, this Court was of the view that the higher estimate of monthly income could be made at Rs. 2000 as gross income before deducting the personal living expenses. FAO No. 2190 of 2011 11 22. The decision in Susamma Thomas was followed in Sarla Dixit v. Balwant Yadav where the deceased was getting a gross salary of Rs. 1543 per month. Having regard to the future prospects of promotion and increase, this Court assumed that by the time he retired, his earning would having nearly doubled, say Rs. 3000. This Court took the average of the actual income at the time of death and the projected income if he had lived a normal life period, and determined the monthly income as Rs. 2200 per month. 23.In Abati Bezbaruah v. Geological Survey of India, as against the actual salary income of Rs. 42,000 per annum (Rs. 3500 per month) at the time of the accident, this Court assumed the income as Rs. 45,000 per annum, having regard to the future prospects and career and advancement of the deceased who was 40 years of age. 24. In Susamma Thomas this Court increased the income by nearly 100%, in Sarla Dixit the income was increased only by 50% and in Abati Bezbaruah, the income was increased by a mere 7%. In view of the imponderables and uncertainties, we are in favour of adopting as a rule of thumb, an addition of 50% of actual salary to the actual salary income of the deceased towards future prospects, where the deceased had a permanent job and was below 40 FAO No. 2190 of 2011 12 years. (Where the annual income is in the taxable range, the words “actual salary” should be read as “actual salary” less tax”). The addition should be only 30% if the age of the deceased was 40 to 50 years. There should be no addition, where the age of the deceased is more than 50 years. Though the evidence may indicate a different percentage of increase, it is necessary to standarise the addition to avoid different yardsticks being applied or different methods of calculation being adopted. Where the deceased was self employed or was on a fixed salary (without provision for annual increment, etc.) the court will usually take only the actual income at the time of death. A departure therefrom should be made only in rare and exceptional cases involving special circumstances.” 22. In the instant case, both the deceased ( two brothers) were young doctors, equipped with medical degrees having recognition throughout the world. They had huge potential to earn more in future. They were getting stipends from DM.C. Hospital, Ludhiana. One of the deceased, Dr. Ajay Maini, was to appear in the examination of M.C.H in All India Institute of Medical Sciences, New Delhi. The ends of justice would be met, if incomes of deceased Ajay Maini and Amit Maini is increased 50% towards their future loss of income keeping in view the fact that had they been alive, they would have earned substantially. This is in conformity with the legal principle that about 50% can be added to the FAO No. 2190 of 2011 13 actual salary, by taking note of the future prospects. The income assessed by the Ld. Tribunal is on the lower side. However, the multiplier applied by the Ld. Tribunal is on the higher side. The same should be 9, keeping in view the age of the parents-claimants of the deceased. The parents are between the age group of 55-60, therefore, multiplier 9 is to be applicable in these cases. The Ld. Tribunal has calculated the income of the deceased on the basis of stipend money of Rs. 11,000/- received by the deceased. The salary of a newly appointed medical practitioner is not less than Rs. 30,000/- per month. This court assumes that Rs. 16,000/- each should be considered as the actual salary of both the deceased in the two cases. Issue No. 2 of the Ld. Tribunal in both claim petitions Nos. 20 and 21 of 2009 is accordingly modified, which will now be read as under:- FAO 2190 of 2011 (In MACT No.20 of 2009) Income of deceased Dr. Ajay Maini = Rs. 16000/- per month 50% deduction towards personal and living expenses = Rs. 8000/- per month 50% increase of future prospects = Rs. 8000+ Rs.8000=16000/- Annual income = Rs. 16000 X 12= 1,92,000/- Multiplier as per Sarla Verma = 9 Amount = Rs. 192000X9= Rs.17,28,000 Conventional Heads = Rs. 25,000/- Total amount to be awarded = Rs. 17,53000/- FAO No.2191 of 2011 (in MACT No.21 of 2009) Income of deceased Dr. Amit Maini = Rs. 16000/- per month 50% deduction towards personal and living expenses = Rs. 8000/- per month FAO No. 2190 of 2011 14 50% increase of future prospects = Rs. 8000+ Rs.8000=16000/- Annual income Rs. 16000 X 12= 1,92,000/- Multiplier as per Sarla Verma = 9 Amount = Rs. 192000X9= Rs.17,28,000 Conventional Heads = Rs. 25,000 Total amount to be awarded = Rs. 17,53000/- 23. The respondents shall deposit the amount of compensation within 45 days from the date of receipt of certified copies of these judgments, failing which the claimants shall be entitled to interest @ 7-1/2% from the date of filing the appeal till its realization. The statutory amount deposited by the appellant-Insurance Company in both the appeals be remitted to the Ld. Tribunal for disbursement to the claimants, in equal shares. The liability shall be the same as ordered by the Ld. Tribunal. 24. In view of the above, both the appeals filed by the Insurance Company are dismissed. (JITENDRA CHAUHAN) JUDGE 20.12.2011 MS