and electricity board.

Motor Vehicles Act, 1988 – s.166 – Fatal accident – Deceased aged 53 years of age and working as a Senior Assistant in the State Electricity Board – Claim petition by his three sons and paternal grand-mother – Tribunal applied a multiplier of 11 and awarded total compensation of Rs.14,27,496/- with interest @ 9% p.a. – High Court, however, reduced the compensation by adopting a split multiplier of 6 – On appeal, held: High Court introduced the concept of split multiplier and departed from the multiplier used by the Tribunal without disclosing any reason therefor – It also did not consider the clear and corroborative evidence about the prospect of future increment of the deceased – Judgment of High Court deserves to be set aside for it was perverse and clearly contrary to the evidence on record – Respondents directed to pay compensation of Rs.18,00,000/- with the rate of interest as granted by the Tribunal. PW1’s father was crossing the road, when a Maruti Van (owned by the first respondent) came at a high speed and dashed against him, causing severe injuries to him which ultimately led to his death. The deceased was 53 years of age and was survived by his wife and three sons, the appellants. They filed a claim petition under Section 166 of the Motor Vehicles Act, 1988 claiming Rs.20,00,000/- as compensation. The Motor Accident Claims Tribunal (MACT) found that the death of PW1’s father was due to the rash and negligent driving of the van driver (the second respondent). The deceased was working as Senior Assistant in Karnataka Electricity Board (KEB) and his last drawn gross monthly salary was Rs.15,642/- i.e. Rs.1,87,704/- annually. The Tribunal applied a multiplier of 11 and awarded total compensation of Rs.14,27,496/- along with interest of 9% p.a. The High Court reduced the compensation to Rs.11,82,000/- by adopting a split multiplier of 6. In the instant appeals, the appellants contended that while awarding compensation, the High Court erred in not considering the future prospects of the deceased and the revision in his salary and that it further erred in adopting a split multiplier. =Allowing the appeals, the Court HELD: 1.1. The law regarding addition in income for future prospects has been clearly laid down in Sarla Varma case. In the said case, the Court held that there should be no addition to income for future prospects where the age of the deceased is more than 50 years. The Bench called it a rule of thumb and it was developed so as to avoid uncertainties in the outcomes of litigation. However, the Bench held that a departure can be made in rare and exceptional cases involving special circumstances. The rule of thumb evolved in Sarla Verma is to be applied to those cases where there is no concrete evidence on record of definite rise in income due to future prospects. The said rule was based on assumption and to avoid uncertainties and inconsistencies in the interpretation of different courts, and to overcome the same. [Paras 8, 9] [1067-C; 1068-A-C] 1.2. In the present case there is clear and incontrovertible evidence on record that the deceased was entitled and in fact bound to get a rise in income in the future, a fact which was corroborated by evidence on record. Thus, the present case comes within the `exceptional circumstances’ and not within the purview of rule of thumb laid down by the Sarla Verma judgment. Hence, even though the deceased was above 50 years of age, he was entitled to increase in income due to future prospects. [Para 10] [1068-D-E] Sarla Varma (Smt.) & Others v. Delhi Transport Corporation & Another (2009) 6 SCC 121 – referred to. 2. The evidence of PW.1 is that there are four claimants, three of them are the sons of the deceased and the other claimant is paternal grand-mother. Therein, he stated that the deceased was the only bread earner of the family. It was stated by PW.1 that if his father, the deceased, would have been alive he could have got promotion and could have received a salary of Rs.20,000/- per month. PW.3, a Senior Assistant in KEB, in his evidence also stated that the deceased was 52 years of age at the time of his death and he was having six years of service left; that his annual increment was Rs.350/- and that in the year 2003 (which would have been year of retirement), the basic pay of the deceased would have been around Rs.16,000/- and in all he would have obtained gross salary of Rs.20,000/- per month. PW.3 deposed that as per the Board Agreement for every five years their pay revision is compulsory. Both the witnesses were cross- examined before the Tribunal but the evidence leading to pay revision was not assailed. Therefore, the consistent evidence before the Tribunal was that if the deceased would have been alive he would have reached the gross salary of Rs.20,000/- per month. [Paras 11 to 13] [1068-F-H; 1069-A] 3. In view of this evidence, the Tribunal should have considered the prospect of future income while computing compensation but the Tribunal has not done that. In the appeal, which was filed by the appellants before the High Court, the High Court instead of maintaining the amount of compensation, granted by the Tribunal, reduced the same. In doing so, the High Court had not given any reason. The High Court introduced the concept of split multiplier and departed from the multiplier used by the Tribunal without disclosing any reason therefor. The High Court also did not consider the clear and corroborative evidence about the prospect of future increment of the deceased. When the age of the deceased is between 51 and 55 years the multiplier is 11, which is specified in the II Column in the II Schedule in the Motor Vehicles Act, and the Tribunal had not committed any error by accepting the said multiplier. This Court also fails to appreciate why the High Court chose to apply the multiplier of 6. Thus, the judgment of the High Court deserves to be set aside for it is perverse and clearly contrary to the evidence on record, for having not considered the future prospects of the deceased and also for adopting a split multiplier method. [Paras 14, 15] [1069-C-G] 4. The income of the deceased will be taken to be Rs.20,000/- p.m. which amounts to Rs.2,40,000/- p.a. After deduction of 1/3rd amount for personal expenses, the loss of notional income will be Rs.1,60,000/-. The multiplier of 11 will be applied, from which the loss of dependency will amount to Rs.17,60,000/-. Besides, award Rs.10,000/- for funeral and transport expenses, Rs.6,000/- for medical expenses prior to death and Rs.25,000/- for loss of love and affection is also awarded. Thus, the total compensation awarded amounts to Rs.18,01,000/- which is round off to Rs.18,00,000/-. The amount of compensation would thus be Rs.18,00,000/- with the rate of interest as granted by the Tribunal. [Paras 16, 17] [1069- H; 1070-A-C] Case Law Reference: (2009) 6 SCC 121 referred to Para 8 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1923-1924 of 2011. From the Judgment & Order dated 12.01.2009 of the High Court of Karnataka at Bangalore in MFA No. 6476/2002(MV) C/w M.F.A. No. 5596 of 2002. G.V. Chandrashekar for the Appellants…

REPORTABLE IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.1923-1924 OF 2011 (Arising out of SLP (Civil) No.16406-16407 of 2010) Sri. K.R. Madhusudhan & Ors. …Appellant(s) Versus The Administrative Officer & Anr. …Respondent(s) J U D G M E N T GANGULY, J. 1. Delay condoned. 2. Leave granted. 3. On 4.10.1998, … Continue reading →