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Fixing compensation in Motor accident case =The High Court opined that the deceased would have contributed an amount of Rs.16,000/- per month to the dependents, whereas the Tribunal opined that the deceased would have contributed an amount of Rs.5,000/-. Both the Courts below proceeded to arrive at the abovementioned amounts on the basis

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IN THE SUPREME COUR OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 1987 OF 2012

(Arising out of SLP (Civil) No.17186 of 2009)

 
New India Assurance Co. Ltd. ….Appellant
Versus
Yogesh Devi & Ors. ….Respondents

 

 

J U D G M E N T

 
Chelameswar, J.
Leave granted.
2. One Vijender Singh along with two others Bhagwan Das and
Manish, was travelling by a motor cycle on 10-12-2002. The said
motor cycle was hit by a truck bearing registration No. RJ-14G-
1556, resulting in the death of both Vijender Singh and Bhagwan
Das. Respondent No.1 is the wife, Respondents 2 to 5 are the
children, Respondent No.6, we are informed, is the mother of the
deceased Vijender Singh. Respondents 1 to 6 herein filed an
application against the appellant herein and others for
compensation. The appellant, admittedly, is the insurer of the
abovementioned truck. A huge claim of Rs.1,86,30,000/-, was
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made towards compensation on the ground that the deceased
Vijender Singh was earning more than Rs.35,000/- per month. The
Tribunal, by its Judgment dated 06-02-2006, awarded an amount of
Rs.10,00,000-00 and provided for appropriate deductions for the
amounts, which had already been paid and also gave necessary
directions for safeguarding the interest of the minor children.
3. From the Judgment of the Tribunal it appears that the
claimants based their claim on the facts that the deceased Virender
Singh was the owner of three vehicles (mini buses) and also certain
agricultural land. It appears from the record that no evidence
regarding the amount of income derived from the above mentioned
properties is adduced. The only evidence available is the statement
of the 1st respondent that the deceased used to give her an amount
of Rs.35,000/- per month. She also admitted in her cross
examination that the deceased was not filing any income tax
returns. Therefore, the Tribunal reached a conclusion that the

 

The petitioners are not entitled to any other compensation and they are held entitled

to receive the following amount of compensation:
1. On a/c of loss of

dependency from income =

Rs.9,60,000.00

2. For loss of consortium to

Petitioner No.1 = Rs.

10,000.00

3. For loss of love and

affection to petitioner

No.2 to 6 @ 5000/- each = Rs.

25,000.00

4. For funeral expenses = Rs.

5,000.00
———————–

Total Rs. 10,00,000.00
3

 

statement of the 1st respondent, that the deceased was earning
more than Rs.35,000/-, cannot be believed. However, the Tribunal
opined as under:
“Thus keeping in view the fact of ownership of two buses

and one bus given on contract and the agriculture land it

can be said that the deceased was earning Rs.3900/-per

month in the capacity of the driver of a bus. Keeping in

view the remaining buses and agriculture land it will be

appropriate to hold the income of the deceased at Rs.7380/-

because in case he would have earned more than the said

amount, he must have filed the income tax return. If the

deceased would remain alive he must have spent 1/3rd upon

himself, therefore it would be appropriate to hold the

monthly dependency at Rs.5000/-.”
4. Aggrieved by the said determination of the compensation
made by the Tribunal, the claimants as well as the appellant herein
carried the matter in Appeal to the High Court of Rajasthan.
Admittedly, the Appeal preferred by the appellant herein was
dismissed, whereas the Appeal preferred by the claimants (S.B.
Civil Misc. Appeal No.1222 of 2006) was partially allowed modifying
the Award of the Tribunal. The High Court by its Judgment dated
30-01-2009 opined that the deceased Vijender Singh’s income
should be taken at Rs.24,000/- per month of which 1/3rd is treated
to be an amount, which the deceased would have spent on himself
and the balance on the claimants. Therefore, the High Court
concluded that the claimants are entitled for a compensation of
Rs.30,72,000/-, and directed:
“However, the rest of the award is confirmed. The

Insurance Company is directed to pay the enhanced amount

along with an interest @ 6% per annum from the date of

the filing of the claim petition i.e. 24.3.03 till the realization
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to the claimants within a period of two months. The

learned Tribunal is directed to insure that the enhanced

amount of compensation is paid to the claimants within a

period of two months from the date of receipt of the

certified copy of this judgment.”
Hence, the present Appeal.
5. The learned counsel for the appellant Sri M.K. Dua argued
that the High Court grossly erred in coming to a conclusion that the
income of the deceased should be determined at Rs.24,000/- per
month. Such a determination is without any factual basis or
evidence on record and therefore, contrary to the principle of law
laid down by this Court in a catena of decisions, more particularly,
in State of Haryana & Anr. Vs. Jasbir Kaur & Ors., (2003) 7 SCC
484, and, therefore, the Judgment under appeal cannot be
sustained.
6. On the other hand, it is very strenuously argued by Sri
Ashwani Garg, learned counsel for the claimants, that in view of the
fact that there are six dependents on the deceased, of whom, four
are school-going children, who are required to be educated by the
1st respondent widow, the High Court rightly enhanced the
compensation and the Judgment under Appeal does not call for any
interference by this Court.
7. This Court in Jasbir Kaur case (supra) held that the Tribunal is
required to make a just and reasonable Award determining the
compensation to be paid to the dependents of the victim of a fatal
motor vehicle accident. Explaining the concept of just and
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reasonable Award in the context of a motor vehicle accident claim,
this Court held as follows:

 
“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 in the real sense “damages” which in turn

appears to it to be ‘just 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 be

to be borne in mind that the compensation is not expected

to be a windfall for the victim. Statutory provisions clearly

indicate 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 on 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

expression “just” denotes equitability, fairness and

reasonableness, and non-arbitrary. If it is not so it cannot be

just. (See Helen C. Rebello Vs. Maharashtra State Road

Transport Corporation, AIR1998SC3191).”

 
8. Keeping the above principle in view, we must now examine
the correctness of the conclusion arrived at by the Judgment under
Appeal that the income of the deceased Virender Singh is to be
taken at Rs.24,000/- per month. The reasoning of the High Court in
that regard is as follows:
6

 
” While trying to assess his income, the learned Tribunal

has conclused that as a driver he must have been earning

Rs.3900/- per month and his total income would have been

7500/- per month. However, considering the fact that

Vijendra Singh would have earned Rs.3900/- per month as

a driver, it is difficult to believe that he would have earned

merely Rs.3600/- from the two buses owned by him. There

is no evidence produced by the respondent No.3 to show

that the buses were not being plied. Considering the lack of

transportation buses are plied. Thus, it is difficult to believe

that in the transportation business, owner of two buses

would have earned merely Rs.3600/- per month from two

buses. Therefore, the logic of the learned Tribunal is

highly questionable. If the figure of Rs.3900/- has a

reasonable assessment of the salary of a driver, obviously

the owner of two buses would have earned more than

Rs.3900/- to the driver of his own bus. Thus, a reasonable

assessment would be that the owner of bus would be

earning atleast Rs.10,000/- from each bus. Therefore,

Vijendra Singh’s income should be taken as Rs.23,900/-

per month or Rs.24,000/- in the round.”
In other words, in view of the Tribunal’s conclusion that Vijender
Singh was earning an amount of Rs.3900/- in his capacity as the
driver of the bus per month, the High Court reached the conclusion
that in his capacity as the owner of three buses, he must be
deriving a much higher income from the buses. We agree with the
logic of the High Court. However, the quantum of such income
would depend upon various factors, such as; whether it is a stage
carriage or a contract carriage, the condition of the bus, its seating
capacity, the route on which it is plying, the cost of maintenance,
the taxes to be paid on such business etc. But, the question is
whether the income (either gross or net) derived by the owner of a
bus could legally form the basis for determining the amount of
compensation payable to his dependents, if he happens to die in a
motor vehicle accident.
7

 

9. In our opinion, such an income cannot form the legal basis for
determining the compensation.
10. In Jasbir Kaur case (supra), the claim was based on an
assertion that the deceased was an agriculturist earning an amount
of Rs.10,000/- per month by cultivating his land. Dealing with the
question, this Court held:
“8. xxxxxxxxx. The land possessed by the deceased still

remains with the claimants as his legal heirs. There is

however a possibility that the claimants may be required to

engage persons to look after agriculture. Therefore, the

normal rule about the deprivation of income is not strictly

applicable to cases where agricultural income is the source.

Attendant circumstances have to be considered.”

 
11. Coming to the case on hand, the claim is based on the
assertion that the deceased owned agricultural land apart from the
abovementioned three mini-buses. The High Court rejected the
claim insofar as it is based on the income from the land, on the
ground that the income would still continue to accrue to the benefit
of the family. Unfortunately, the High Court failed to see that the
same logic would be applicable even to the income from the
abovementioned three buses. The asset (three mini-buses) would
still continue with the family and fetch income. The only difference,
perhaps, would be that during his life time the deceased was
managing the buses, but now, the claimants may have to engage
some competent person to manage the asset, which, in turn, would
require some payment to be made to such a manager. To the
extent of such payment, there would be a depletion in the net
8

 

income accruing to the claimants out of the asset. Therefore, the
amount required for engaging the service of a manager and the
salary payable to a driver – as it is asserted that the deceased
himself used to drive one of the three buses – would be the loss to
the claimants. In the normal course the claimants are expected to
adduce evidence as to what would be the quantum of depletion in
the income from the abovementioned asset on account of the
abovementioned factors. Unfortunately, no such evidence was led
by the claimants.
12. In the circumstances, the Judgment under Appeal cannot be
sustained as the finding of the High Court that the claimants lost an
amount of Rs.16,000/- per month due to the death of Vijender
Singh is neither based on any evidence nor the logic adopted by the
High Court for arriving at such a conclusion is right. In the normal
course, the matter should have been remitted to the Tribunal for
further evidence for ascertaining of the basis upon which the
compensation is to be determined. But having regard to the fact
that the accident occurred a decade ago, we do not propose to
remit the matter for further evidence.
13. The High Court opined that the deceased would have
contributed an amount of Rs.16,000/- per month to the
dependents, whereas the Tribunal opined that the deceased would
have contributed an amount of Rs.5,000/-. Both the Courts below
proceeded to arrive at the abovementioned amounts on the basis
9

 

that as a driver of one of the buses, he was getting a salary of
Rs.3,900/- per month. In the circumstances, making a reasonable
conjecture that somebody to be employed for the purpose of
managing the business of the three mini-buses, would certainly
demand a higher salary than a driver, we think it reasonable to
notionally fix the salary of such manager at Rs.10,000/- per month.
The said amount coupled with the salary of one driver, i.e.,
Rs.3,900/- would be the loss sustained by the family from the
income arising out of the asset. Computed on the basis of the said
figure and applying the same multiplier of 16 which was applied by
both the courts below, the amount of compensation payable to the
claimants would be:
13,900 x 12 x 16 = Rs.26,68,800/-
14. The Judgment under Appeal shall stand modified accordingly
and remain unaltered in all other respects. Appeal stands disposed
of.

 

 

………………………………….J.

( P. SATHASIVAM )

 

 

………………………………….J.

( J. CHELAMESWAR )
New Delhi;

February 10, 2012.

 

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