M.F. Saldanha
1. This appeal which has been preferred by the then Bangalore Transport Division of the Karnataka State Road Transport Corporation assails the validity of the order passed by the Motor Accidents Claims Tribunal-EC, Bangalore City in M.V.C. No. 2873 of 1993, dated 27th June, 1996. A most gory incident had taken place at about 6 a.m., on 18-9-1993 when the deceased A. Ramachandran who was a Senior Technician working with Hindustan Aeronautics Limited had travelled in BTS bus bearing No. CAF 701. He had alighted at the bus-stop and had proceeded to walk a little distance when the bus started moving and he came to be run over by the rear wheel of the bus as a result of which, he died instantaneously. His widow, the three children out of whom two were minors and the mother were the five claimants before the Tribunal. They had claimed an aggregate compensation of Rs. 4,75,000/- under different heads and the basic controversy in this appeal centers around the fact that this case was referred to Lok Adalat and after certain negotiations, a figure of Rs. 2,35,000/- was supposedly agreed upon as a compromise figure. Having reached this stage of settlement, since at that time the position in law was that the Lok Adalats only had the jurisdiction to record the compromise and then refer the case back to the judicial forum for giving effect to it, the proceeding went back to the Motor Accidents Claims Tribunal. The learned Judge passed an order dated 11-3-1996 rejecting the compromise and proceeded to decide the case on merits. Ultimately, an award was made for a sum of Rs. 3,17,400/- along with interest at the rate of 6% per annum and it is this order that are the subject-matter of the challenge before us.
2. The appellants' learned Advocate advanced the submission that it is well-settled law that where the parties refer a dispute to an alternate disputes resolution forum such as the Lok Adalat and if the compromise formula materialises before that forum, that it is then not open to either of the parties to resile from that compromise. In support of this contention, the learned Advocate has relied on two decisions of this Court, one in United India Insurance Company Limited, Bangalore v. Smt. Patramma and Ors., : ILR1995KAR2086 wherein the learned Single Judge took the view that it will be necessary for the party who desires to resile from the decision that has been obtained from that forum to demonstrate that the decision is manifestly bad or perverse or so inherently wrong that it stares one in the face and therefore requires not to be accepted. The other decision relied upon is reported in United India Insurance Company Limited, Bangalore v. Mohammed and Anr., 1995(1) Kar. L.J. 265, 1999-I-LLJ-1068 (Kar.), ILR 1999 Kar. 3541, : 1999(1)KarLJ265 wherein again the learned Single Judge of this Court recorded the proposition that if the claimant had taken any objection and had filed an application that he was not prepared to accept the award of the Lok Adalat, then the Commissioner could have proceeded in accordance with law and by implication the learned Single Judge held consequently that in the absence of a valid objection being pleaded, that the compromise was required to be respected and accepted by the Tribunal. Our attention was also drawn to a decision in Deputy General Manager and Divisional Controller, Karnataka State Road Transport Corporation, Raichur Division v. Kamappa and Ors., 1993(1) Kar. L.J. 80 : ILR 1998 Kar. 584 wherein the Division Bench of this Court upheld the position in law whereby an Advocate is authorised to enter into a compromise and to record consent to a compromise petition. Our attention was also drawn to a decision of the Supreme Court in Byram Pestonji Gariwala v. Union Bank of India and Ors., : AIR1991SC2234 wherein the Supreme Court upheld the position that a compromise entered into by Counsel is binding on the claimant. On the basis of these decisions, the appellants' learned Advocate submitted that on the facts of the present case it was certainly not open to the Tribunal and that too, suo motu, to have rejected the compromise and his submission was that in keeping with the decision in Mohammed's case, supra, that this Court must revise the order passed by the Tribunal and award the compensation in consonance with the compromise figure agreed before the Lok Adalat.
3. The respondents' learned Advocate submits that the solitary ground on which the learned Member of the Tribunal rejected the compromise was because there were two minors who were claimants viz., applicants 4 and 5 and the Tribunal has recorded the view that the compromise formula does not appear to be in consonance with the principle of safeguarding the interest of the minors. In this context, he has drawn our attention to a decision of the Supreme Court in Prithvichand Ramchand Sablok v. S.Y. Shinde, : [1993]3SCR729 wherein the Apex Court had occasion to examine the terms of a consent decree and the Court reiterated the well-crystallized proposition in law that the Court should reach an independent satisfaction that the terms proposed are just and reasonable. The respondents' learned Advocate submits that it is very obvious that on the facts of the present case which were to knowledge of the learned Member, he was of the view that the compensation figure that had been arrived at before the Lok Adalat was inadequate or in other words, that it was not in consonance with the interests of the minors and that consequently, the rejection of that compromise formula was more than fully justified.
4. The issue canvassed before us is one of immense consequence. We are basically in agreement with the general proposition canvassed by the appellants' learned Advocate when the submitted before us that normally the Courts would respect and even enforce the decision of the Lok Adalat insofar as it is a specialist body set up for the purpose of arriving at quick and fair solutions, invariably it is presided over by persons of integrity and experience, the parties and their learned Advocates are usually represented and by and large, there is really no ground on which one could find fault with the finality of the compromise terms that emerge from the Lok Adalat. We do concede that this would be the general principle that would hold good but, there are situations in which that would not be the case. If one were to examine the basic proposition of law on the question as to whether in each and every case, the finality of the compromise arrived at before the Lok Adalat is 100% binding on the Court, the answer is in the negative. The jurisdiction of the Court to examine the fairness and the correctness of that compromise formula can never be taken away and it is equally well-settled law, as has been reiterated by the decision of the Supreme Court in Prithvichand Ramchand Sablok's case, supra, referred to by us, that the basic principles of reasonableness and fairness are the overriding factors and this is the touch-stone on which a Court will always have the power to accept or reject what has emerged from the Lok Adalat. We cannot lose sight of the situations in which a certain formula may be arrived at very hurriedly, there may be situations in which that process has been finalised through collusion, there may be situations in which unfortunately the presiding officers may not have applied their minds as well as they should have or even otherwise could have been either mislead or are in error and it is for this reason that the Court will always play the role of a supervisory watch-dog. That being the position in law, we need to clarify that even if the parties for whatever reason do not object to the compromise, that it is still the basic inherent and sacred duty of the Court to scrutinise it from the angles as indicated by us above and if it passes the test, there shall be no problem but if it does not, the Court or the judicial authority is not obliged to follow that decision.
5. The present case is on a slightly different footing insofar as the learned Member of the Tribunal has referred to the provisions of Order 32, Rule 7 of the Civil Procedure Code which enjoins upon the Court the duty to carefully examine as to whether the interests of the minor have been duly and adequately safeguarded. In simple terms, in a case of the present type, the member was required to assess as to whether, if the traditional method were to be adopted for award of compensation, the amount which would have been received by the applicants and consequently by the minors would be very much higher than what has been agreed to and if as happened in the present case, there is a wide gulf between the two figures, then the Member of the Tribunal was not only fully justified but, he was downright correct in having rejected the compromise formula. This is precisely the principle that has been reiterated in the decision of Basappa Siddgouda Biradar Patil v. Basagondappa and Ors., : ILR1991KAR4374 and even though that is a decision of a learned Single Judge, we fully approve of the reasoning in that decision. Having regard to this position, in our considered view, the submissions canvassed on behalf of the appellants that the Tribunal in the instant case was bound by the compromise formula that had been finalised before the Lok Adalat cannot be accepted.
6. Coming to the merits of the case, the appellants' learned Advocate brought it to our notice that the Tribunal has proceeded on the basis of the salary certificate that was produced but what he lays emphasis is on the fact that though the Post-mortem Notes and the evidence of the wife, P.W. 1 clearly indicated that the deceased was aged 53 years, the Tribunal has for certain reasons discounted this figure and has recorded the finding of age as 56 years. The learned Counsel submits before us that the Tribunal has overlooked one very important aspect viz., the fact that at age of 56 years obviously the deceased was close to retirement or superannuation and what he submits is that for purposes of computing the capitalised loss of dependency, the Tribunal has accepted the salary figure and straightaway applied the multiplier of 9. He draws our attention to a Division Bench decision in Union of India and Ors. v. K.S. Lakshmi Kumar and Ors., 2001(1) Kar. L.J. 91 : ILR 2000 Kar. 3809 wherein the Division Bench has laid down a very important proposition of law viz., that in cases of the present type where the date of superannuation falls within the period of the multiplier then, the Court would be wrong in proceeding or in adopting the same figure for the entire period because the Court has to take cognizance of the fact that the income would considerably drop once the pensionable age is arrived at and assuming the party is eligible for pension, then it is that figure that is material. What is submitted before us is that the Tribunal has erred in having applied the common multiplier for the whole period and this period would have to be split into two parts taking the lower figure for the period after retirement. The respondents' learned Advocate has objected to any interference with the computation because he relies on the basic principle that on the present record, this computation was justified.
7. The principle with regard to variation in the earning capacity after a particular point of time as laid down in K.S. Lakshmi Kumar's case, supra, referred to by us and relied upon by the appellants' learned Counsel is undoubtedly correct but, in order to apply that principle, it is first necessary to demonstrate to the Court that the principle can be applied on the basis of the facts that are on record. Times without number, this Court has virtually passed strictures with regard to the manner in which these cases are conducted before the Motor Accidents Claims Tribunal wherein even the elementary amount of care is not taken while conducting the proceedings and this applies to both sides for purposes of bringing on record the requisite material. This is a classic instance where the appellants' learned Counsel has advanced a point which we would have straightaway upheld but he is totally handicapped by the fact that on record there is nothing to indicate as to when the deceased would have retired, there is nothing to indicate as to whether he would have been eligible for pension, there is nothing to indicate as to what are the terms and conditions applicable to Hindustan Aeronautics Limited in such cases and all of this material ought to have been brought on record by the Corporation's learned Advocate in the course of cross-examination or by summoning the witness from Hindustan Aeronautics Limited. In the absence of factual material, it becomes impossible for us to give effect to that principle which we would have otherwise done. It is for this reason that we refrain from modifying the order as far as the manner in which the income figure has been computed for the entire period.
8. At this stage, another aspect came to our notice viz., the fact that irrespective of the controversy of whether the age of the deceased was in fact 53 or 56 that the same multiplier would apply but, what has been noticed by us is the fact that having regard to the law as has now been settled in V.S. Gowdar v. Oriental. Insurance Company Limited, Bangalore and Anr., 2002(5) Kar. L.J. 216 by the Full Bench of this Court, that the correct multiplier would be 11 and not 9. The appellants' learned Counsel was quick to point out to us that as the law stood on the date of the decision, the application of the multiplier 9 was correct on the date of the accident and his submission is that the decision in question ought not to be given virtually retrospective application. On the other hand, the respondents' learned Advocate submits that in a situation wherein the law has been clarified and where the appeal is pending, that the appeal Court is duty-bound to give effect to the law as clarified and enunciated and settled by the Division Bench and if thereby the respondents are entitled to some marginally higher compensation, that this should be awarded. The question we put to the respondents' learned Advocate is as to whether it would be within the jurisdiction of the appeal Court in the absence of even cross-objections, to interfere with the final computation done by the Tribunal. The appellants' learned Counsel vehemently submitted that even under the provisions of Order 41, Rule 22 that it may be open to the respondents at the highest to support the order but that asking for any enhancement on any ground would be totally barred. The respondents' learned Counsel submitted that the provisions of Order 41, Rule 33 of the Civil Procedure Code are wide enough to invest the jurisdiction with the appeal Court to make such variation in the order as the record would justify and that this can be done notwithstanding the fact that no appeal or cross-objection has been filed. While we do concede that normally, a Court would not exercise this power, we need to again point out that there may be situations in which in the course of the hearing of an appeal such as the present one, an error of computation comes to the notice of the Appeal Court and in such situations notwithstanding the fact that there is no appeal or cross-objection, it would be well-within the powers of the appeal Court to take corrective action. The legislative intent behind the provisions of Order 41, Rule 33 or for that matter, the inherent powers of the Court under Section 151 of the Civil Procedure Code is in order to cater to the situations wherein in the overall interests of doing real justice and justice in the true sense of the term, a Court will not be fettered in taking whatever corrective steps are necessary. Having regard to this position, we have recomputed the amount under the head of loss of dependency by applying the multiplier 11 and we arrive at the figure of Rs. 67,200/-. The order of the Tribunal is accordingly varied insofar as the, appellants would be liable to pay an additional sum of Rs. 67,200/- along with interest computed at the rate of 8% per annum on the enhanced amount only for the period starting from the date of the appeal until the date of payment.
9. We therefore direct the appellants to deposit the aforesaid amount with the Tribunal within an outer limit of 12 weeks from today. In the special facts and circumstances of the case and considering the need of the parties which has been assessed by us, we hold that the whole of this enhanced compensation amount will be awardable to the wife, who is the original applicant 1. Secondly, for purposes of her own security, we direct that the amount of Rs. 60,000/- shall be invested in the Post Office Monthly Income Scheme in the name of the wife and any other person of her choice and a nominee of her choice at a Post Office situated closest to where the lady is residing. The amount in question shall be invested for two periods of 6 years each in the Monthly Income Scheme renewable after the first period is over. The interest which will be tax free shall be credited to the Savings Bank Account and the applicant 1 will be entitled to withdraw the same. The balance amount shall be released to the applicant 1.
Subject to the aforesaid modifications, the appeal to stand disposed of. The parties to bear their own costs. The amount deposited by the appellants in this Court if not transferred to the Tribunal shall be transferred forthwith.