Management Board Vs. Kanta Aggarwal & Ors.  INSC 1035 (7 July 2008)
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APEPAL NO. 4216 OF 2008 (Arising
out of SLP (C) No. 21953/2004) Bhakra Beas Management Board ...Appellant Versus
Kanta Aggarwal and Ors. ...Respondents
Dr. ARIJIT PASAYAT, J
in this appeal is to the judgment of a learned Single Judge of the Punjab
and Haryana High Court dismissing the appeal filed against the award dated
4.2.2003 passed by Motor Accidents Claim Tribunal, Chandigarh (in short
facts in a nutshell are as follows:
In an accident which
took place on 16.11.1994 at about 10.00 p.m. K.C. Aggarwal (hereinafter
referred to as the `deceased') who was sitting directly behind the driver lost
his life. Balbir Singh (PW-1) was an eye witness to the accident.
At the relevant time,
he was standing in front of Mayur Dhaba near which the accident took place. He
categorically deposed that the jeep was coming from Bilaspur side and was going
towards Sunder Nagar at a very high speed. It was being driven by the driver in
the middle of the road. He also stated that a truck was coming from the
opposite side at normal speed. When the truck reached near the jeep, the driver
of the jeep applied brakes, but because the jeep was being driven at a very
high speed, it came to halt in the middle of the road. The back portion of the
truck struck against the right side portion of the jeep. Some persons rushed
towards the jeep. In the meantime, the truck sped away from the spot. He
categorically stated that the accident occurred due to rash and negligent
driving of the jeep driver. The deceased left behind a widow and three
children. A claim petition was filed by the widow and the children under
Section 166 of the Motor Vehicles Act, 1988 (in short the `Act'). The Tribunal
awarded compensation of Rs.8,48,160/- along with interest @ 9% per annum from
the date of institution.
An appeal was filed
before the High Court. It was pointed out that on the death of K.C. Aggarwal,
respondent No.1- widow had been provided with compassionate appointment and she
was getting salary of nearly Rs.4,700/- p.m. (basic pay of nearly Rs.4,700/-)
and a residence was provided to her. The High Court did not accept this plea
and observed that the quantum of compensation has been rightly fixed.
counsel for the appellant submitted that the benefits which claimant has
received on account of death of her husband have to be deducted while computing
the compensation, if any, payable. With reference to the factual aspects
it is submitted that respondent No.1 was getting salary of nearly
Rs.4,700/- and therefore she was not entitled to compassionate
appointment. It is pointed out that the appeal filed by the claimants is
pending adjudication and without considering the relevant factors the High
Court has declined to interfere.
counsel for the respondents on the other hand submitted that the judgment
of the High Court is in order.
are several undisputed factors: (i) the husband of respondent No.1 had
received fatal injuries in an accident; (ii) the claimants seem to be
facing financial problem; (iii) the concept of just compensation cannot be
lost sight of. The High Court does not appear to have considered the
effect of amount received on account of compassionate appointment.
United India Insurance Co. Ltd. and Ors. v. Patricia Jean Mahajan and Ors.
(2002 (6) SCC 281) it was inter-alia observed as follows:
"24. Mr. Soli J.
Sorabji submitted that while assessing the amount of compensation, the benefits
which have accrued to the claimants by reason of death must also be taken into
account. A kind of balancing of losses and the gains or benefit by reason of
death would be necessary. In support of the above contention he has referred to
a decision reported in Gobald Motors Service Limited v. R. M. K. Veluswami
(1962 (1) SCR 929), and others. It is a decision by a three-Judge Bench of this
Court, and at SCR page 938 the observations made by the House of Lords in
Davies v. Powell Duffryn Associated Collieries Ltd. (1942 AC page 601) has been
quoted which reads as follows : AIR ER p. 658 B) "The general rule which
has always prevailed in regard to the assessment of damages under the Fatal
Accidents Acts is well settled, namely, that any benefit accruing to a
dependent by reason of the relevant death must be taken into account. Under
those Acts the balance of loss and gain to a dependant by the death must be
ascertained, the position of each dependant being considered separately."
25. To further
elaborate the above proposition, observations made by Lord Wright in Davies
case (supra) have also been quoted. It reads as follows :- "The damages
are to be based on the reasonable expectation of pecuniary benefit or benefit
reducible to money value. In assessing the damages all circumstances which may
be legitimately placed in diminution of the damages must be considered.....The
actual pecuniary, loss of each individual entitled to sue can only be
ascertained by balancing, on the one hand, the loss to him of the future
pecuniary benefit, and on the other, any pecuniary advantage which from
whatever source comes to him by reason of the death."
The learned counsel
laid stress on the last part of observation made to the effect that - for the
purposes of balancing losses and gains any pecuniary advantage which from
whatever source come to them, has to be considered.
26. It is submitted
in Gobald's case the principle of Davies Case was referred and taken into
consideration. Reliance has also been placed on a decision reported in M/s.
Sheikhupura Transport Co. Ltd. v. Northern India Transport Insurance Company
(1971 (1) SCC page 785), particularly to the observations made by the Court in
paragraph 6 of the judgment where the principle in the case of Gobald Motors
(supra) has been reiterated. In this connection learned counsel for the
Insurance Company has also drawn our attention to the decision in the case of
Susamma Thomas (supra) particularly on paragraph 8 of the report, where it is
observed that the principle in the case of Davies v. Powell was adopted, in the
case of Gobald Motors (supra). It is thus submitted that principle of balancing
of loss and gains, so as to arrive at a just and fair amount of compensation
has been accepted by this Court as well. On behalf of the Insurance Company
Hodgson v. Trapp (1988 (3) All ER 870) has been relied on in which our
attention has particularly been drawn to the following observations made at All
ER p. 873j-874b: "........the basic rule is that it is the net
consequential loss and expense which the Court must measure. If, in consequence
of the injuries sustained, the plaintiff has enjoyed receipts to which he would
not otherwise have been entitled, prima facie, those receipts are to be set
against the aggregate of the plaintiff's losses and expenses in arriving at the
measure of his damages. All this is elementary and has been said over and over
again. To this basic rule there are, of course, certain well established,
though not always precisely defined and delineated, exceptions. But the Courts
are, I think, sometimes in danger, in seeking to explore the rationale of the
exceptions, of forgetting that they are exceptions. It is the rule which is
fundamental and axiomatic and exceptions to it which are only to be admitted on
grounds which clearly justify their treatment as such."
From the above
passage it is clear that the deductions are admissible from the amount of
compensation in case the claimant receives the benefit as a consequence of
injuries sustained, which otherwise he would not have been entitled to. It does
not cover cases where the payment received is not dependent upon an injury
sustained on meeting with an accident. The other observation to which our
attention has been drawn at page 876 placitum 'f' also does not help the
contention raised on behalf of the Insurance Company for deduction of amounts
in the present case. The Court was considering a situation where due to the
injuries received the victim was claiming cost of care necessary in future in
respect of which statutory provision, provided for attendant's allowance. It
was found that the statutory benefit and the damages claimed were designed to
meet the identical expenses. This is however not so, at least not shown, to be
so in the case in hand." R.M.K. Veluswami and Ors. (1962 (1) SCR 929 at
p.938) it was inter-alia observed as follows:
8. "The general
rule which has always prevailed in regard to the assessment of damages under
the Fatal Accidents Acts is well settled, namely, that any benefit accruing to
a dependant by reason of the relevant death must be taken into account. Under
those Acts the balance of loss and gain to a dependant by the death must be
ascertained, the position of each dependants being considered separately."
9. In Helen C. Rebello
v. Maharashtra S.R.T.C. (1999 (1) SCC 90) it was held as follows:
"32. So far as
the general principle of estimating damages under the common law is concerned,
it is settled that the pecuniary loss can be ascertained only by balancing on
one hand, the loss to the claimant of the future pecuniary benefits that would
have accrued to him but for the death with the "pecuniary advantage"
which from whatever source comes to him by reason of the death. In other words,
it is the balancing of loss and gain of the claimant occasioned by the death.
But this has to change its color to the extent a statute intends to do. Thus,
this has to be interpreted in the light of the provisions of the Motor Vehicles
Act, 1939. It is very clear, to which there could be no doubt that this Act
delivers compensation to the claimant only on account of accidental injury or
death, not on account of any other death. Thus, the pecuniary advantage
accruing under this Act has to be deciphered, correlating with the accidental
death. The compensation payable under the Motor Vehicles Act is on account of
the pecuniary loss to the claimant by accidental injury or death and not other
forms of death. If there is natural death or death by suicide, serious illness,
including even death by accident, through train, air flight not involving a
motor vehicle, it would not be covered under the Motor Vehicles Act. Thus, the
application of the general principle under the common law of loss and gain for
the computation of compensation under this Act must correlate to this type of
injury or death, viz., accidental. If the words "pecuniary advantage"
from whatever source are to be interpreted to mean any form of death under this
Act, it would dilute all possible benefits conferred on the claimant and would
be contrary to the spirit of the law. If the "pecuniary advantage"
resulting from death means pecuniary advantage coming under all forms of death
then it will include all the assets moveable, immovable, shares, bank accounts,
cash and every amount receivable under any contract. In other words, all
heritable assets including what is willed by the deceased etc. This would
obliterate both, all possible conferment of economic security to the claimant
by the deceased and the intentions of the legislature. By such an
interpretation, the tort feasor in spite of his wrongful act or negligence,
which contributes to the death, would have in many cases no liability or meager
liability. In our considered opinion, the general principle of loss and gain
takes colour of this statute, viz., the gain has to be interpreted which is as
a result of the accidental death and the loss on account of the accidental
death. Thus, under the present Act, whatever pecuniary advantage is received by
the claimant, from whatever source, would only mean which comes to the claimant
on account of the accidental death and not other forms of death. The
constitution of the Motor Accident Claims Tribunal itself under Section 110 is,
as the section states:
"... for the
purpose of adjudicating upon claims for compensation in respect of accidents
involving the death of, or bodily injury to, ...".
33. Thus, it would
not include that which the claimant receives on account of other forms of
deaths, which he would have received even apart from accidental death. Thus,
such pecuniary advantage would have no correlation to the accidental death for
which compensation is computed. Any amount received or receivable not only on
account of the accidental death but that which would have come to the claimant
even otherwise, could not be construed to be the "pecuniary
advantage", liable for deduction. However, where the employer insures his
employee, as against injury or death arising out of an accident, any amount
received out of such insurance on the happening of such incident may be an
amount liable for deduction.
legislature has taken note of such contingency through the proviso of Section
95. Under it the liability of the insurer is excluded in respect of injury or
death, arising out of and in the course of employee.
34. This is based on
the principle that the claimant for the happening of the same incidence may not
gain twice from two sources. This, it is excluded thus, either through the
wisdom of the legislature or through the principle of loss and gain through
deduction not to give gain to the claimant twice arising from the same
transaction, viz., the same accident. It is significant to record here in both
the sources, viz., either under the Motor Vehicles Act or from the employer,
the compensation receivable by the claimant is either statutory or through the
security of the employer securing for his employee but in both cases he
receives the amount without his contribution. How thus an amount earned out of
one's labor or contribution towards one's wealth, savings, etc. either for
himself or for his family which such person knows under the law has to go to
his heirs after his death either by succession or under a Will could be said to
be the "pecuniary gain" only on account of one's accidental death.
This, of course, is a pecuniary gain but how this is equitable or could be
balanced out of the amount to be received as compensation under the Motor
Vehicles Act. There is no correlation between the two amounts. Not even
remotely. How can an amount of loss and gain of one contract be made applicable
to the loss and gain of another contract. Similarly, how an amount receivable
under a statute has any correlation with an amount earned by an individual.
Principle of loss and gain has to be on the same plane within the same sphere,
of course, subject to the contract to the contrary or any provision of
10. It is pointed out
that the award as made is extremely high and the concept of just compensation
has been lost sight of.
11. Learned counsel for
the respondent supported the judgment and additionally submitted that appeal of
respondent No.1 is pending. In normal course, when two appeals are directed
against the common judgment, both the appeals should be heard by the same Bench
of the High court.
12. But we find that the
High Court lost sight of the fact that the benefits which the claimant receives
on account of the death or injury have to be duly considered while fixing the
compensation. It is pointed out that respondent No.1 was getting Rs.4,700/-
p.m. and a residence has been provided to her and actually the compassionate
appointment was given immediately after the accident.
13. In view of what has
been stated above, the High Court's judgment is clearly unsustainable. However,
the accident took place more than 14 years back and it would not be desirable
to send the matter back to the Tribunal for fresh consideration. A sum of
rupees five lakhs has been deposited vide this Court's order dated 1.11.2004.
We are of the considered view that in view of the background facts, it is just
and proper that the sum of Rupees five lakhs already deposited shall be
permitted to be withdrawn by the claimants in full and final settlement of the
claim relatable to the death of the deceased. It is for the Tribunal to fix the
quantum of fixed deposit and the amount to be released to the claimants.
14. The appeal is allowed
in the aforesaid extent.
(Dr. ARIJIT PASAYAT)