Raj Rani & Ors. Vs.
Oriental Insurance Co.Ltd.& Ors.  INSC 970 (6 May 2009)
IN THE SUPREME COURT
OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 3317-3318 OF 2009
(Arising out of SLP (C) Nos.27792-27793 of 2008) Raj Rani & Ors. ...
Appellants Versus Oriental Insurance Co. Ltd. & Ors. ... Respondents
S.B. Sinha, J.
before the Motor Vehicles Accident Claims Tribunal (for short, `the Tribunal')
are before us aggrieved by and dissatisfied with a judgment and order dated
10.6.2008 passed by the High Court of Uttarakhand at Nainital in AFO No.101 of
2006 and AFO No.107 of 2006.
deceased Diwan Pal Singh was driving a Maruti car bearing registration
No.UHP-4787 belonging to one Gopal Sharan Paliwal from 2 Bareilly to Haldwani.
He was an Assistant Engineer working in Uttar Pradesh Avas Evam Vikas Praishad,
a statutory organisation. He was accompanied by one T.K. Pandey, one of his
a truck bearing registration No. UP 25-6235 was parked in middle of the road.
It did not put on the lights. Claimants contend that although the car was being
driven at a nominal speed of 40 km per hour, owing to another vehicle coming
from the other side and as the parking lights of the tuck being not on, it was
sighted at the last minute. Deceased tried to take the car towards left side
but it dashed against the truck resulting in the death of Diwan Pal Singh. A
sum of Rs.50,50,000/- was claimed, inter alia, on the premise that his monthly income
was Rs.17,431/- per month and he was aged only 42 years.
claim petition was filed by his children as also his parents, Shri Chandra
Singh pal and Smt. Chandra Devi. Shri Chandra Singh Pal has since expired.
Before the Tribunal, one of the appellants was examined who stated that the
salary of the deceased was about 17,400/- per month and he was going to be
promoted to the post of Executive Engineer. It was furthermore stated that his
wife had not received any family pension. T.K. Pandey, who was accompanying the
deceased in the said car was examined as PW2. He, in his deposition, stated :
occurred due to negligence of Truck Driver. Diwan Pal Singh was going to be
promoted on the post of Executive Engineer, if promotion would have taken place
then would have received salary of Rs.25,000/- per month."
was not cross-examined on the question with regard to the income of the
deceased as also the fact that he would have been promoted to the post of
Executive Engineer very soon.
The learned Tribunal
was of the opinion that there was a contributory negligence on the part of the
deceased also. As regards the amount of compensation, it took into
consideration the net salary at Rs.11,625/- and dearness allowance at
Rs.4,766/- totaling Rs.16,391/-. It applied the multiplier of 15 on the basis
whereof the amount of loss of subsistence worked out to be Rs.29,50,380/-. Out
of the said amount 1/3rd was deducted towards personal expenses of the
deceased. A further 1/3rd amount was deducted on premise that compensation was
being paid in lump sum.
the Insurance Company as also the appellants, preferred appeals thereagainst.
The High Court, by reason of the impugned judgment, opined that both the
drivers of the car as also the driver of the truck having contributed to the
accident, the extent of contributory negligence should be calculated at 50%
With regard to the
amount of compensation, it was held :
4 "It has come
on record that both the vehicles were insured with Oriental Insurance Company
The Tribunal has
given a finding that Oriental Insurance Company Ltd. is liable to pay the total
amount of compensation shared by both the vehicles involved in the accident.
This finding of the Tribunal is perverse as the deceased was the owner of the
offending car and he himself was driving the car at the time of accident,
therefore, he cannot be termed as third party and hence the claimants cannot be
compensated for the death of the deceased by the insurer. Further, the claimants
cannot get the compensation upto the extent of 50% each out of total amount of
compensation on account of rash and negligence on the part of deceased/driver
of Maruti car. Thus, the claimants are entitled to get 50% of the entire amount
of compensation i.e. Rs.6,55,640/- plus Rs.2000/- towards funeral expenses and
Rs.5000/- towards loss of love and affection = Rs.6,62,640/- (rounded
Rs.6,63,000/-). The conditional interest imposed by the Tribunal is also liable
to be set aside and I am of the view that the amount of compensation awarded by
this Court in the Appeal i.e. Rs.6,63,000/- shall be paid by the insurer of the
offending Truck along with interest @ 7.5% per annum with effect from the date
of filing the petition till the date of actual payment instead of conditional
interest imposed by the Tribunal in the impugned judgment and award."
So far as the appeal
preferred by the claimants-appellants is concerned, it was merely stated :
"As far as AO
No.101 of 2006 filed by claimants is concerned, learned counsel for the
claimants- appellants has raised the argument that the Tribunal has awarded a
meager amount and the same should be enhanced. He has further 5 submitted that
the amount of compensation has been awarded by the Tribunal on take home salary,
while it should have been awarded on gross salary.
He has also submitted
that the Tribunal has awarded conditional interest whereas the interest should
be awarded from the date of filing the petition."
Ashwani Gard, learned counsel appearing on behalf of the appellant, would urge
1) The High Court
committed a serious error in deducting the amount of 1/3rd twice over.
2) The Tribunal as
also the High Court committed a serious error in opining that the deceased
Diwan Pal Singh was driving the vehicle negligently or the extent of his
contributory negligence was 50%.
3) In computing the
amount of compensation, all allowances payable to the deceased should have also
been taken into consideration.
4) The Tribunal as
also the High Court should have taken into consideration, the future prospects
of the deceased as well.
9. Mr. Atul Nanda,
learned counsel appearing on behalf of the respondent, on the other hand, would
6 i) Appellant
having not made any submission before the High Court with regard to the
contributory negligence or future prospects of the deceased, this Court should
not interfere with the impugned judgment.
ii) The question as
regards contributory negligence being essentially a question of fact, the same
does not warrant any interference by this Court.
iii) In any event, if
the multiplier indicated in the Second Schedule appended to the Motor Vehicles
Act, 1988 is applied, the question of consideration of payment of any higher
amount on the basis of a future prospect would not arise.
fact that the deceased was getting a salary of Rs.17,431/- is not in dispute.
Apart from the dearness allowance, if other allowances were payable which were
beneficial to the entire family, the same should have been taken into
consideration for the purpose of computation of the annual income. It was so
held in National Insurance Company Ltd. v. Indira Srivastava & Ors. [(2008)
2 SCC 763].
deceased was aged about 42 years. If the depositions of the witnesses examined
on behalf of the claimants were to be believed and we see no reason as to why
they should not be, his future prospect also could not have been ignored for
the purpose of determining the annual income.
7 For the said
purpose, immediate future prospect would be a relevant factor.
It is possible in a
given case, where the chance of promotion is remote or the deceased was at the
end of his carrier, his future prospect would be kept out of consideration.
But, evidently, he was to be promoted to the post of Executive Engineer. If he
was to be so promoted, his income would have been around 25,000/- The said
factor, therefore, was required to be considered. [See General Manager, Kerala
State Road Transport Corporation, Trivendrum v. Susamma Thomas (Mrs.) &
Ors. [(1994) 2 SCC 186] and Smt. Sarla Dixit & Anr. v. Balwant Yadav &
Ors. [(1996) 3 SCC 179].
Nanda may be correct to some extent that for the purpose of computation of the
total amount of compensation under Section 163A of the Motor Vehicles Act, the
future prospect may not be of much relevance. But in a case where claim
petition has been filed in terms of Section 166 of the Act, the same would, in
our opinion, be a relevant factor. Mr. Nanda may also be correct that this
aspect of the matter has not been considered by the High Court. However,
keeping in view the fact that such a contention had all along been raised by
the claimants even before the Tribunal and evidences have not been adduced in
respect thereof on their behalf, it is difficult to ignore the said contention
of the appellants.
is not necessary in a proceeding under the Motor Vehicles Act to go by any
rules of pleadings or evidence. Section 166 of the Act speaks about grant of
just compensation. The court's duty being to award just compensation, it will
try to arrive at the said finding irrespective of the fact as to whether any
plea in that behalf was raised by the claimant or not.
In Nagappa v.
Gurudayal Singh & Ors. [(2003) 2 SCC 274], this Court has held as under :
under the provisions of Motor Vehicles Act, 1988, (hereinafter referred to as
"the MV Act") there is no restriction that compensation could be
awarded only up to the amount claimed by the claimant. In an appropriate case
where from the evidence brought on record if Tribunal court considers that
claimant is entitled to get more compensation than claimed, the Tribunal may
pass such award. Only embargo is--it should be 'Just' compensation, that is to
say, it should be neither arbitrary, fanciful nor unjustifiable from the
evidence. This would be clear by reference to the relevant provisions of the
M.V. Act. Section 166 provides that an application for compensation arising out
of an accident involving the death of, or bodily injury to, persons arising out
of the use of motor vehicles, or damages to any property of a third party so
arising, or both, could be made (a) by the person who has sustained the injury;
or (b) by the owner of the property; or (c) where death has resulted from the
accident, by all or any of the legal representatives of the deceased: or (d) by
any agent duly authorised by the person injured or all or any of the legal
representatives of the deceased, as the case may be. Under the proviso to Sub-
section (1), all the legal representatives of the 9 deceased who have not
joined as the claimants are to be impleaded as respondents to the application
for compensation. Other important part of the said Section is Sub-section (4)
which provides that "the Claims Tribunal shall treat any report of
accidents forwarded to it under Sub-section (6) of Section 158 as an
application for compensation under this Act." Hence, Claims Tribunal in
appropriate case can treat the report forwarded to it as an application for
compensation even though no such claim is made or no specified amount is
deceased died at a very young age. He being highly qualified could have been
promoted to higher posts. Although the multiplier specified in the Second
Schedule appended to the Motor Vehicles Act are stricto sensu not applicable in
a case under Section 166 of the Act, it is not of much dispute that wherever
the court has to apply the appropriate multiplier having regard to several
factors in mind, one of them would be the factor of a high income of the
deceased. The family background as also the income of the family would also be
a relevant factor.
deceased, apart from his wife and children who were five in number, had to
maintain the parents also. His father's age at the time of filing the claim
application was 70 years. He expired during pendency of the proceeding. While
making an endeavour to find the appropriate multiplier, one of the factors
which may have to be borne in mind although not wholly relevant as to whether
the other members of the family were 10 having independent income. There is
nothing to show that the wife or children of the deceased as well as his
parents had any independent income as on the date of his death. His family was not
getting any family pension.
We, therefore, are of
the opinion that application of the multiplier of 15 cannot be said to be on a
very higher side.
16. So for as the
issue of "contributory negligence" is concerned, we may notice that
the tribunal has deducted 1/3rd from the total compensation on the ground that
deceased had contributed to the accident. The same, we find, has been upheld by
the High Court. This court in Usha Rajkhowa and Ors. v.
and Ors. [Civil Appeal No.1088 of 2009 (arising out of SLP (C) No.16647 of
2008)] discussed the issue of contributory negligence noticing, inter alia,
earlier decisions on the same topic. It was held that :
question of contributory negligence on the part of the driver in case of collision
was considered by this Court in Pramodkumar Rasikbhai Jhaveri v. Karmasey
Kunvargi Tak and Ors. reported in (2002) 6 SCC 455. That was also a case of
collusion in between a Car and a truck. It was observed in Para 8:
`The question of
contributory negligence arises when there has been some act or omission on the
claimant's part, which has materially contributed to the damage caused, and is
of such a nature that it may properly be described as `negligence'. Negligence
ordinarily means breach of a legal duty to care, but when used in the
expression 11 "contributory negligence", it does not mean breach of
any duty. It only means the failure by a person to use reasonable care for the
safety of either himself or his property, so that he becomes blameworthy in
part as an author of his own wrong."
principle of 50:50 in cases of contributory negligence has been discussed and
applied in many cases before this court. In Sri Krishna Vishweshwar Hede v. The
General Manager, K.S.R.T.C. (2008 ACJ 1617), this court upheld the judgment of
the Tribunal assessing the ratio of liability at 50:50 in view of the fact that
there was contributory negligence on the part of the appellant and fixed the
responsibility for the accident in the ratio of 50:50 on the driver of the bus
and the appellant. In this case, the truck was stationary. Some amount of
negligence on the part of the deceased cannot be ruled out.
in the insistent case, we find that there was contributory negligence on the
part of the deceased and accordingly the claimant was entitled to only 50% of
the total amount of loss of dependency.
question now arises for consideration is as to whether the Tribunal could have
made a further deduction of 1/3rd from the amount of compensation on the
rationale that the amount is being paid in lump sum.
12 We do not think
so. Few decisions of this court may be noticed in this regard.
In National Insurance
Co. Ltd. V. Swarnalatha Das [1993 Supp.(2) SCC 743], it is held :
is all the reasoning in the judgment. We are afraid that the reasoning is
incomplete and cannot by itself support the enhancement. The appropriate method
of assessment of compensation is the method of capitalisation of net income
choosing a multiplier appropriate to the age of the deceased or the age of the
dependants whichever multiplier is lower. It is, no doubt, true that as a rough
and ready measure, the method of aggregating the total expected income for the
remainder of the life- expectancy with appropriate deductions towards
uncertainties of life and for lump sum payments is also resorted to. But this
method is now considered unscientific and is virtually obsolete. At all events
wherever it is resorted to it would require to be cross-checked with the
results of the appropriate and the more scientific method of capitalisation of
the loss of dependency."
practice of deduction for lump sum payments from the amount of compensation
awarded in Motor Accident cases by the tribunal have been disapproved by this
court in several other decisions. [(See Hardeo Kaur v. Rajasthan State
Transport Corporation [(1992) 2 SCC 567)]; Renu Bala Kalitha v. Dhiren
Chakravatty [(1998) 8 SCC 363]; and Urmilla Pandey v. Khalil Ahmad [(1994) 4
Thus, the High Court
as well as the Tribunal have erred in deducting a further 1/3rd from the amount
of compensation on the reasoning of payment of lump sum amount.
has furthermore to be borne in mind that apart from the amount of compensation and
funeral expenses as also a partial sum towards the loss of consortium on the
part of wife, no amount has been paid on other heads.
therefore, are of the opinion that the amount of compensation should be
calculated at Rs. 17,431/- per month plus Rs.25,000/- considering his future
prospects of promotion as an Executive Engineer divided by 2 for the purpose of
calculating the loss of income, which should be multiplied by 12 and then
Annual Income, multiplied by 15 which comes to Rs. 38,18,790/-. Further, as
1/3rd should be deducted towards personal expenses of the deceased, the
financial dependency would come to Rs.25,45,860/- from which a further
deduction of 50% shall be made by way of contributory negligence on the part of
the deceased. Thus, the claimants are entitled to Rs.12,72,930/-. An amount of
Rs.7000/- towards funeral Expenses and consortium shall be added making it
Rs.12,79,930/- which is rounded off to Rs.12,80,000/- with interest throughout
at the rate of 7=% per annum.
appeals are disposed of on the above terms.
[Dr. Mukundakam Sharma]
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