Gobind Ram Vs. Gian Chand - Court Judgment

Excerpt:
- sections 163-a & 166: [r.v.raveendran & l.s.panta,,jj] motor accident claim-principles governing determination of liability and quantum of compensation under sections 163-a and 166 respectively distinction between held, the principles relating to determination of liability and quantum of compensation are different for claims made under section 163-a of the mv act, 1988 and claims under section 166 of the said act. section 163-a and schedule ii to the 1988 act in terms do not apply to determination of compensation in applications under section 166. section 163-a r/w schedule ii: [r.v.raveendran & l.s.panta,jj] method for determination of compensation as provided for under schedule ii- various discrepancies/errors in multiplier scale and other incongruities occurring in schedule ii were pointed out by supreme court. sections 166 & 168: [r.v. raveendran & l.s. panta, jj] fatal accident - objective approach in assessing compensation what is just compensation - held, assessment of compensation, though involves certain hypothetical considerations, should nevertheless be objective. justice and justness emanate from equality in treatment, consistently and thoroughness in adjudication, and fairness and uniformity in the decision making process and the decisions. hence, expressing grave concern over lack of uniformity and consistency among the decision of tribunals, held, when the factors/inputs as well as the formula/legal principles are the same, consistency and uniformity, and not divergence and freakiness, should be the result of adjudication to arrive at just compensation. to arrive at uniformity and consistency in determination of compensation in cases of death, tribunals directed to follow the well-settled steps as indicated herein. sections 166 & 168 :[r.v.raveendran & l.s.panta,jj] fatal accident-assessment of compensation held, facts are required to be established by claimants in relation thereto - issue to be determined by tribunal to arrive at loss of dependency restated. sections 166 & 168 :[r.v. raveendran & l.s.panta,jj] fatal accident - heads (and amounts under such heads) under which compensation may be granted held, assessment of compensation though involving certain hypothetical considerations, should nevertheless be objective. further, the compensation awarded does not become just compensation merely because the tribunal considers to be just. just compensation is adequate compensation which is fair and equitable, on the facts and circumstances of the case, to make good the loss suffered as a result of the wrong, as far as money can do so, by applying the well settled principles relating to award of compensation. it is not intended to be a bonanza, largesse or source of profit. justice and justness emanate from equality in treatment, consistency and thoroughness in adjudication, and fairness and uniformity in the decision-making process and the decisions. while it may not be possible to have mathematical precision or identical awards in assessing compensation, same or similar facts should lead to awards in the same range. when the factors/inputs are the same, and the formula/legal principles are the same, consistency and uniformity, and not divergence and freakiness, should be the result of adjudication to arrive at just compensation. therefore, if different tribunals calculate compensation differently on the same facts, the claimant, the litigant, the common man will be confused, perplexed and bewildered. if there is significant divergence among the tribunals in determining the quantum of compensation on similar facts, it will lead to dissatisfaction and distrust in the system. basically only three facts need to be established by the claimants for assessing compensation in the case of death i.e. (a) age of the deceased; (b) income of the deceased; and (c) the number of dependants. further, the issues to be determined by the tribunal to arrive at the loss of dependency are; (i)additions/deductions to be made for arriving at the income of the deceased; (ii) the deduction to be made towards the personal living expenses of the deceased; and (iii) the multiplier to be applied with reference to the age of the deceased. if these determinants are standardized, there will be uniformity and consistency in the decisions. there will be lesser need for detailed evidence. it will also be easier for the insurance companies to settle accident claims without delay. thus, to have the said uniformity and consistency, the tribunals are directed to determine compensation in cases of death, by the following well-settled steps viz., step 1 (ascertaining the multiplicand) the income of the deceased per annum should be determined. out of the said income a deduction should be made in regard to the amount which the deceased would have spent on himself by way of personal and living expenses. the balance, which is considered to be the contribution to the dependant family, constitutes the multiplicand; step 2 (ascertaining the multiplier) having regard to the age of the deceased and period of active career, the appropriate multiplier should be selected. this does not mean ascertaining the number of years he would have lived or worked but for the accident. having regard to several imponderables in life and economic factors, a table of multipliers with reference to the age has been identified by the supreme court. the multiplier should be chosen from the said table with reference to the age of the deceased; step 3 (actual calculation) the annual contribution to the family (multiplicand) when multiplied by such multiplier gives the loss of dependency to the family; thereafter, a conventional amount in the range of rs. 5000 to rs 10,000 may be added as loss of estate. where the deceased is survived by his widow, another conventional amount in the range of rs. 5000 to rs. 10.000should be added under the head of loss of consortium. but no amount is to be awarded under the land of pain, suffering or hardship caused to the legal heirs of the deceased. the funeral expenses, cost of transportation of the body (if incurred) and cost of any medical treatment of the deceased before death (if incurred) should also be added. sections 166 & 168: [r.v.raveendran & l.s.panta,jj] selection of relevant multiplier - appropriate table for - inconsistency among decisions of tribunals/courts - need to avoid - as some tribunals/courts following multiplier given/actually adopted in mv act schedule ii and certain following different multipliers indicated in different decisions of supreme court, held, such kind of inconsistency is to be avoided. cases falling under section 166 are governed by davies method i.e. method enunciated in davies case, 1942 ac 601. multiplier to be used in such cases should be as mentioned in column (4) of the table given herein (in para 40), prepared by applying susamma thomas case, (1994) 2 scc 176 (which preferred davies method), trilok chandra case, (1996) 4 scc 362 and charlie case, (2005) 10 scc 720 thus, the operative multiplier is 18 for the age groups of 15 to 20 and 21 to 25 years; and 17,16,15,14 and 13 for the age groups of 26 to 30,31 to 35, 36 to 40, 41 to 45 and 46 to 50 years respectively; and 11,9,7, and 5 for the age groups of 51 to 55,56 to 60 to 65 and 66 to 70 years respectively . sections 166 & 168: [r.v.raveendran & l.s.panata,jj] death in accident-compensation - determination of income of deceased held, generally the actual income of the deceased less income tax should be the starting point for calculating the compensation. but having regard to evidence as to future prospects, in kerala state road transport corporation v susamma thomas 1994 (2) scc 176, the court increased the income by nearly 100%, in sarla dixit v balwant yadav, 1996 (3) scc 179 the income was increased only by 50% and n abati bezbaruah v geological survey of india, 2003 (2) scc 148 the income was increased by a mere 7%. in view of the imponderables and uncertainties, it is favoured to adopt 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 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 standardize 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 increments, etc.), the courts 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. in the present case, the conclusion of the high court as to the monthly income of the deceased is in conformity with the legal principle that about 50% can be added to the actual salary, by taking note of the future prospects. further, the assumption of the appellant claimants that the actual future pay revisions should be taken into account for the purpose of calculating the income is not sound. in this case, the accident and death occurred in the year 1988. the award was made by the tribunal in the year 1993. the high court decided the appeal in 2007. the pendency of the claim proceedings and appeal for nearly two decades is a fortuitous circumstance and that will not entitle the appellants to rely upon the two pay revisions which took place in the course of the said two decades. if the claim petition filed in 1988 had been disposed of in the year 1988-1989 itself and if the appeal had been decided by the high court in the year 1989-1990, then obviously the compensation would have been decided only with reference to the scale of pay applicable at the time of death and not with reference to any future revision in pay scales. if the contention urged by the claimants is accepted, it would lead to the following situation: the claimants could only rely upon the pay scales in force at the time of the accident, if they are prompt in conducting the case. but if they delay the proceedings, they can rely upon the revised higher pay scales that may come into effect during such pendency. surely, promptness cannot be punished in this manner. hence, the contention that the revisions in pay scale subsequent to the death and before the final hearing should be taken note of for the purpose of determining the income for calculating the compensation, is rejected. sections 166, 168 & 163-a: [r.v. raveendran & l.s. panta, jj] compensation under section 166 - deductions to be made from income of deceased towards his personal and living expenses applicability of one-third deduction as envisaged in section 163-a - held, in order to arrive at the contribution to the dependants, the personal and living expenses of the deceased should be deducted from his income. but no evidence need be led to show the actual expenses of the deceased. in fact, any evidence in that behalf will be wholly unverifiable and likely to be unreliable. the claimants will obviously tend to claim that the deceased was very frugal and did not have any expensive habits and was spending virtually the entire income on the family. on the other hand, it will be difficult for the respondents in claim petition to produce evidence to show that the deceased ws spending a considerable part of the income on himself or that he was contributing only a small part of the income on his family. therefore, it became necessary to standardize the deductions to be made under the head of personal and living expenses of the deceased. this lead to the practice of deducting towards personal and living expenses of the deceased, one-third of the income if the deceased was married, and one-half (50%) of the income if the deceased was a bachelor. this practice was evolved out of experience, logic and convenience. in fact one-third deduction got statutory recognition under the second schedule to the mv act, 1988, in respect of claims under section 163-a of the said act. but, such percentage of deduction is not an inflexible rule and offers merely a guideline. though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in u.p.s.r.t.c., v trilok chandra 1996 (4) scc 362, the general practice is to apply standardized deductions. having considered several subsequent decisions of the supreme court, it is opined that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependent family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceeds six. but where the deceased was a bachelor and the claimants are the parents, the deduction follows a different principle. in regard to bachelors, normally, 50% is deducted as personal and living expenses, because it is assumed that a bachelor would tend to spend more on himself. even otherwise, there is also the possibility of his getting married in a short time, in which event the contribution to the parent(s) and siblings is likely to be cut drastically. further, subject to evidence to the contrary, the father is likely to have his own income and will not be considered as a dependant and the mother alone will be considered as a dependant. in the absence of evidence to the contrary, brothers and sisters will not be considered as dependants, because they will either be independent and earning, or married, or be dependent on the father. thus, even if the deceased is survived by parents and siblings, only the mother would be considered to be a dependant, and 50% would be treated as the personal and living expenses of the bachelor and 50% as the contribution to the family. however, where the family of the bachelor is large and dependent on the income of the deceased, as in a case where he has a widowed mother and large number of younger non-earning sisters or brothers, his personal and living expenses may be restricted to one-third and contribution to the family will be taken as two-third. in the present case where the deceased was survived by a widow, three minor children, parents and grandfather, who later died), as an earning member, the deceased would have spent more on himself than the other members of the family apart from the fact that he would have incurred expenditure on travelling/transportation and other needs. therefore, interest of justice would be met if one-fifth is deducted as the personal and living expenses of the deceased. sections 166 & 168: [r.v.raveendran & l.s.panta,jj] determination of compensation - death of a government servant, aged 38 years, in a motor accident deceased, whose salary at the time of his death was rs 4000 p.m., was survived by a widow, three minor children, parents and grandfather, who later died - taking note of future prospects of said deceased, his monthly income for purpose of assessment of compensation determined as rs 6006 by adding about 50% of his salary to actual salary income - deducting 1/5th of the monthly income towards personal and living expenses of deceased, contribution to family (dependants) determined as rs 57,658 p.a. having regard to age of deceased, applying the multiplier of 15, loss of dependency worked out as rs. 57,658 x 15 i.e. rs 8.64,870 - in addition thereto, claimants also entitled to rs 5000 under the head of loss of estate and rs 5000 towards funeral expenses - further, widow to get rs 10,000 as loss of consortium -thus, total compensation determined as rs 8,84,870 - after deducting rs 7,19,624 awarded by high court, the enhanced compensation would be rs.1,65,246 - appellant claimants are entitled to said enhanced sum in addition to what was already awarded, with interest @ 6% p.a. from the date of petition till the date of realisation. - respondent filed the suit for specific performance of the contract as the appellant failed to execute the sale deed within time. when the matter came up before us another attempt was made for a settlement, which failed. court is guided by principle of justice, equity and good consensus.s.n. phukan, j.1. this appeal by special leave is directed against the judgment of delhi high court dated 20th december, 1991 passed in rfa no. 50 of 1977.2. we may briefly state the undisputed facts. the appellant agreed to sale the disputed property situated at lajpat nagar (iv), new delhi for a consideration of rs. 16,000/- to the respondent and accordingly on 24th january, 1973 an agreement to sale was executed and a sum of rs. 1000/- was paid as earnest money to the appellant. respondent filed the suit for specific performance of the contract as the appellant failed to execute the sale deed within time. on 6-10-1976 the suit was decreed and the respondent deposited balance consideration on rs. 15,000/- in the trial court. the appeal filed by the appellant in the high court was also dismissed by the impugned judgment dated 20th december, 1991. however, to mitigate the hardship to the appellant and as the respondent agreed to pay more sum, high court directed the respondent to deposit a further sum of rs. 1,00,000/- which was to be released to the appellant on giving possession of the suit property. the said sum was also deposited in the registry of the high court by the respondent and it is being kept in interest bearing fixed deposit. the appellant has filed the present appeal and that is how the parties are before us.3. we have heard learned senior counsel for the parties. only contention urged before us by the learned senior counsel for the appellant is that instead of decree for specific performance compensation may be awarded.4. at the time of issuance of notice in the special leave petition, learned senior counsel for the appellant offered to pay rs. 1,16,000/ - to the respondent to cancel the contract and get out of' the decree. the respondent after his appearance before this court offered another sum of rs. 50,000/- so as to make the total consideration of rs. 1.50,000/-. in view of the above position leave was granted. when the matter came up before us another attempt was made for a settlement, which failed. at that time learned senior counsel for the respondent on instruction made an offer that respondent would pay further sum of rs. 1,50,000/- as consideration.5. learned senior counsel for the appellant has relied on this court's judgment in damacherla anjaneyufu and another v. damacherla venkata seshaiah and another : air 1987 sc1641 . on the facts of that case the court recorded the finding that in case of grant of a decree of specific performance hardship would be caused to defendant and therefore compensation was granted. facts of present case are different.6. next decision on which learned senior counsel for the appellant relied is in parakunnan veetill joseph's son mat hew v. nedu'rnbera kuruvila 's son and others : air 1987 sc2328 . we may extract the relevant portion of the said judgment:section 20 of the specific relief act, 1963 preserve judicial discretion to courts as to decreeing specific performance. the court should meticulously consider all facts and circumstances of the case. the court is not bound to grant specific performance merely because it is lawful to do so. the motive behind the litigation should also enter into the judicial verdict. the court should take care to see that it is not used as an instrument of oppression to have an unfair advantage to the plaintiff.7. it is the settled position of law that grant of a decree for specific performance of contract is not automatic and is one of discretion of the court and the court has to consider whether it will be fair, just and equitable. court is guided by principle of justice, equity and good consensus. as stated in p.v. joseph's son mathew (supra) the court should meticulously consider all facts and circumstances of the case and motive behind the litigation should also be considered.8. high court considering the facts of this case and observed as follows:we are conscious of the fact that the defendant has been in possession of the said quarter for the last several decades and logical consequences of affirming the judgment of the trial court would mean considerable hardship to him, at the same time the conduct of he defendant does not justify any further indulgence by the court. we have no doubt that the defendant has tried to wriggle out of the contract between the parties because of the tremendous escalation in the prices of real estate properties all over the country and in delhi, in particular in the last few years.9. in view of the above clear finding of the high court that the appellant tried to wriggle out of the contract between the parties because of escalation in prices of real estate properties, we hold that the respondents is entitled to get a decree as he has not taken any undue or unfair advantage over the appellant. it will be inequitable and unjust at this point of time to deny the decree to the respondent after two courts below have decided in favour of the respondent. while coming to the above conclusion we have also taken note of the fact that the respondent deposited the balance of the consideration in the trial court and also the amount in the high court, as directed. on the other hand appellant as held by the high court tried to wriggle out of the contract in view of the tremendous escalation of prices of real estate properties. however, to mitigate the hardship to the appellant we direct respondent to deposit a further sum of rs. 3,00,000/- within 4 months from today with the registry of this court and the amount shall be kept in short term deposit in a nationalised bank. while giving the above direction we have taken note of the offer made to us on behalf of the respondent. this amount is to be paid to the appellant on giving his possession of the suit property to the respondent within 6 months from the date of the deposit of the above amount. the appellant shall also be entitled to withdraw the amount already deposited in the trial court and the amount of rs, 1,00,000/- which has been kept in interest bearing fixed deposit in the registry of the high court.10. with the above modification of the judgment of the high court, appeal is dismissed. however, on the facts and circumstances of the case parties are directed to bear their own cost.