Smt. Arun Gupta and anr. Vs. Sansar Chand and ors. - Court Judgment

Surjit Singh, J.

1. This appeal, Under Section 173 of the Motor Vehicles Act, has been filed by the claimants, as they are aggrieved by quantum of compensation awarded by the Tribunal.

2. Facts relevant for the disposal of the appeal may be noticed. Deceased Surinder Kumar Gupta was employed as General Manager with H.P. Financial Corporation, whose Managing Director has been impleaded as respondent No. 4 in the appeal. On 25.3.1998, he was travelling by the car of his employer, i.e. H.P. State Financial Corporation, bearing registration No. HP-03/1290, in connection with some official tour. The car was being driven by Mangat Ram, respondent No. 5 herein. It collided with a truck, bearing registration No. HP-31/2133. Truck was owned by respondent Sansar Chand and was being driven by respondent Brij Lai. It was insured with National Insurance Company Ltd., impleaded as respondent No. 3. The car, by which the deceased was travelling, was insured with respondent No. 6 New India Assurance Company Ltd. As a result of the accident, Surinder Kumar Gupta died. He was 52 years of age at the time of the fatal accident. His monthly income on account of salary was around Rs. 25,000/-, inclusive of bonus. Claimants alleged that the accident had taken place due to rash or negligent driving of the car as also the truck. They filed a petition, Under Section 166 of the Motor Vehicles Act, seeking award of compensation to the tune of Rs. 50,00,000/ -. Both the sets of the respondents contested the claim and denied that the cause of the accident was rash or negligent driving. Managing Director, H.P. State Financial Corporation, i.e. the employer of the deceased stated in the reply that the deceased's monthly income from salary, as per revised pay-scale, on the date of death, was Rs. 20,310/-.

3. Learned Tribunal after holding the enquiry came to the conclusion that the accident had taken place because of rash or negligent driving of the car by the driver of the employer of the deceased and so the employer of the deceased, the driver of the car and the Insurance Company, with which the car was insured for third party risk, were liable to pay compensation. The Tribunal, without referring to the evidence on record and just by hunch, concluded that the deceased might have been saving Rs. 5,000/- per month out of his salary for rainy days and adopted this assumed figure of Rs. 5,000/- as multiplicand or datum figure and chose the multiplier of 11 years' purchase and named the resultant figure as loss of dependency. To this figure, the Tribunal added a sum of Rs. 50,000/- on account of loss love and affection and Rs. 15,000/- on account of expenses on funeral and obsequies and awarded a total sum of Rs. 7,27,000/-, with costs quantified at Rs. 2,000/- and interest at the rate of 12% per annum from the date of the award.

4. Appellants' grievance is that the monthly income of the deceased from the salary and the bonus was Rs. 24,000/- per month and that the loss of dependency is not less than Rs. 16,000/- a month. They have, therefore, prayed that the figure of Rs. 16,000/- be taken as multiplicand and compensation awarded by multiplying it with 11 years' purchase. It is also their grievance that the interest has been awarded from the date of the award, whereas it was required to be awarded from the date of the filing of the petition before the Tribunal, i.e. 20.6.1998.

5. learned Counsel for the parties, besides making their submissions, took me through the evidence on record, particularly that part of it which pertains to the income of the deceased. Admittedly, the deceased was 52 years of age. He has left behind a widow and an adult son. It is stated in the reply of the employer of the deceased, who is also the owner of the car, the driver of which car has been held to be negligent, that the monthly gross salary of the deceased was to the tune of Rs. 20,310/-. Appellants examined an employee from the office of the Financial Corporation, i.e. the employer of the deceased. He is PW-4, Bhupinder Singh. The witness stated that, besides drawing the salary, the deceased was being paid bonus equivalent to 2 month 10 days salary, annually. The amount of bonus works out to Rs. 47,322/- [Rs. 20,310/- (monthly salary) x 2.33 (2 months 10 days)]. This way, the gross monthly income of the deceased from salary and bonus comes to Rs. 24,253/-. The deceased must have been paying income tax (deducted at source). Giving discount for standard deduction, permissible deductions on account of savings etc., it can legitimately be presumed that the deceased must have been paying atleast Rs. 3,000/- as month by way of tax. Thus, his net income, after deduction of amount of tax, conies to Rs. 21,253/-. The Tribunal has in fact awarded compensation on account of loss to the estate only because it has assumed that the deceased must have been saving atleast Rs. 5,000/- a month for the rainy days ahead. The Tribunal has not awarded anything on account of loss of dependency. As a matter of fact, what was required to be done in the case was to find out the amount, which the deceased was accustomed to spending upon himself for self maintenance and entertainment, etc. and deduct that amount out of his net income and to treat the remainder as loss to his dependents. In this view of the matter, I find support from two recent judgments of the Apex Court in Managing Director, TNSTC Ltd. v. K.I Bindu and Ors. : AIR2005SC4425 and T.N. State Transport Corporation Ltd. v. S. Rajapriya and Ors. : AIR2005SC2985 .

6. There being no evidence on record indicating, even remotely, as to what amount, out of his earnings, the deceased was accustomed to spending upon himself, there is no alternative but to assume by sheer guess that the deceased had been spending l/3rd of his net income on himself, leaving the balance of his two dependents, i.e. his wife and an adult son. This way, the figure of monthly pecuniary loss suffered by the claimants works out to Rs. 14,000/-.

7. The Tribunal has adopted multiplier of 11 years' purchase. The deceased was 52 years of age. He was employed in a Public Sector Undertaking. He would have retired on attaining the age of superannuation, which is 58 years. After retirement, he would have been entitled to pension, had he not died in the accident and would have continued in service till the attainment of the age of superannuation, because PW-4 Bhupinder Singh, an employee from the office of the Financial Corporation, has stated that the job of the employees of the Corporation has been made pensionable from 1.4.1999. During the period of service, deceased's salary would have arisen, on account of accrual of annual increments and grant of dearness allowance and may be that he would have got a promotion or two. Therefore, the figure of monthly pecuniary loss of Rs. 14,000/-, worked out herein above, need not be brought down for working out the quantum of compensation payable to the appellants on account of loss of dependency and loss to estate.

8. In a number of recently delivered judgments, the Hon'ble Supreme Court has held that the multiplier of years' purchase cannot be more than 18 years and that this highest multiplier is to be adopted only in the case of persons in the age group of 21 to 25 years, when ordinarily an Indian citizen starts independently earning and that in the case of the persons in the higher age groups, the multiplier should be lower, the lowest being in respect of persons in the age group of 60 to 70. Reference may be made to Managing Director, TNSTC Ltd. v. K.I. Bindu and Ors. : AIR2005SC4425 and T.N. State Transport Corporation Ltd. v. S. Rajapriya and Ors. : AIR2005SC2985 . In the case of K.I. Bindu (supra), the deceased was aged 34 years. The Tribunal adopted multiplier of 17 years and the High Court in appeal did not interfere. The Hon'ble Supreme Court brought down the multiplier to 13. In Rajapriya's case (supra), the deceased was 38 years of age. The Tribunal adopted multiplier of 16, the Hon'ble Supreme Court brought it down to 12.

9. In the present case, as already noticed, the deceased was aged 52 years. Therefore, multiplier of 11, as adopted by the Tribunal, cannot be approved. Looking to the age of the deceased and the fact that had he not died in the accident, he would have superannuated within six years and then his monthly income in the form of pension would have come down to about one half of the income from salary, I am of the considered view that the multiplier in the present case cannot be higher than 7 years' purchase. Thus, the compensation payable on account of loss of dependency and loss to the estate comes to Rs. 11,76,000/-. The Tribunal has awarded Rs. 65,000/- on account of loss of love and affection and funeral expenses etc., in addition to the pecuniary damages. Respondents do not assail the amount of Rs. 65,000/- awarded on this count. Thus, the total amount of compensation payable to the claimants comes to Rs. 12,41,000/ -. The Tribunal has awarded interest at the rate of 12% per annum from the date of the award. It is by now settled that the interest is payable from the date of the petition. However, keeping in mind the fact that the rates of interest have been constantly declining over the years, the rate at which the interest has been awarded by the Tribunal cannot be endorsed. Of late, the Hon'ble Supreme Court has been awarding interest at the rate of 7.5% per annum. So, it is ordered that the owner, the driver and the insurer of the car shall be liable to pay interest on the aforesaid amount of compensation at the rate of 7.5% per annum from the date of the petition, i.e. 20.6.1998, instead of 12% per annum from the date of the award of the Tribunal.

10. Appeal stands disposed of accordingly.