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Supreme Court of India
G.S. SINGHVI & SUDHANSU JYOTI MUKHOPADHAYA, JJ.
Puttamma & Others
Versus
K. L. Narayana Reddy & Another
Civil Appeal No. 10918 of 2013 (arising out of SLP (C) No.4639 of 2010)
Decided On : 09-12-2013
Held: Thus according to the English Law compensation/damages were payable according to the proportionate loss whereas in India compensation is payable which appears to the Tribunal to be just is payable. The approach of the Courts according to the English law and according to the Indian Law have to be distinct and separate. Indian Law recognizes just compensation whereas English law required compensation proportionate to the loss suffered. English courts have been calculating loss of money as a bargain as to how much monetary loss has been caused to the claimant, as a result the death of bread earner/deceased. The English Law being different, English judges were having different approach towards the grant of compensation to the deceased’s family.
(B) Motor Vehicles Act, 1988—Sections 163-A and 166—Compensation—Determination—Structured formula as prescribed under Second Schedule and multiplier mentioned therein is not binding for claims under Section 166—Act, 1988 does not envisage application of split multiplier—In absence of any specific reason and evidence on record Tribunal or Court should not apply split multiplier in routine course and should apply multiplier as per decision of Apex Court in case of Sarla Verma affirmed in case of Reshma Kumari.
Held: Thus it will be evident from the provisions of the Act that the structured formula as prescribed under Second Schedule and the multiplier mentioned therein is not binding for claims under Section 166 of the Act, 1988.
For determination of compensation in motor accident claims under Section 166 this Court always followed multiplier method. As there were inconsistencies in selection of multiplier, this Court in Sarla Verma prepared a table for selection of multiplier based on age group of the deceased/victim. Act, 1988 does not envisage application of split multiplier.
We, therefore, hold that in absence of any specific reason and evidence on record the Tribunal or the Court should not apply split multiplier in routine course and should apply multiplier as per decision of this Court in the case of Sarla Verma(supra) as affirmed in the case of Reshma Kumari (supra). Compliance of Section 158(6) and 166(4) of the Act, 1988
(C) Motor Vehicles Act, 1988—Section 171—Compensation—Interest—No rate of interest has been fixed and its duty is bestowed upon Tribunal to fix rate of interest—Rate of interest must be just and reasonable depending on facts and circumstances of case and should be decided after taking into consideration relevant factors like inflation, change in economy, policy being adopted by Reserve Bank of India from time to time, how long case is pending, loss of enjoyment of life etc.
Held: Grant of Interest—Section 171 of the Act, 1988 deals with the award of interest where any claim is allowed.This Court in Abati Bezbaruah v. Deputy Director General, Geological Survey of India & Anr. (2003) 3 SCC 148 noticed that varying rate of interest is being awarded by the Tribunals, High Courts and this Court. In the said case, this Court held that the rate of interest must be just and reasonable depending on the facts and circumstances of the case and should be decided after taking into consideration relevant factors like inflation, change in economy, policy being adopted by the Reserve Bank of India from time to time, how long the case is pending, loss of enjoyment of life etc.
Result: Appeal allowed.
Cases Referred:
Deepal Girishbhai Son and others vs. United India Insurance Co. Ltd., Baroda, (2004) 5 SCC 385; Sarla Verma(Smt.) and others vs. Delhi Transport Corporation and another, 2009(6) SCC 121; Jyotsana Dey and Ors. vs. State of Assam & Ors., 1987 ACJ 172; Hardeo Kaur & Ors. vs. Rajasthan State Transport Corporation & Anr., (1992) 2 SCC 567; Reshma Kumari & Ors. vs. Madan Mohan & Anr., (2013) 9 SCC 65; K.R. Madhusudhan and others vs. Administrative Officer and another, (2011) 4 SCC 689; General Insurance Council & Others v. State of Andhra Pradesh & Others (2007) 12 SCC 354; Jai Prakash v. National Insurance Co. Ltd. & Ors (2010) 2 SCC 607; U.P. State Road Transport Corporation & Ors. v. Trilok Chandra & Ors. (1996) 4 SCC 362; Oriental Insurance Co. Ltd. v. Hansrajbhai V. Kodala (2001) 5 SCC 175; Kaushnuma Begum v. New India Assurance Co. Ltd. & Ors. (2001) 2 SCC 9; Abati Bezbaruah v. Deputy Director General, Geological Survey of India & Anr. (2003) 3 SCC 148; Supe Dei v. National Insurance Co. Ltd.& Anr. (2009) 4 SCC 513—Relied.
Judgment :-
Sudhansu Jyoti Mukhopadhaya, J.
Delay condoned. Leave granted.
2. This appeal has been preferred by the appellants-claimants in motor accident case against the judgment and order dated 19th March, 2009 passed by the Division Bench of the High Court of Karnataka, Bangalore in a motor accident case being Miscellaneous First Appeal No. 2344 of 2004(MV). They are not happy with the meager enhancement of compensation granted by the High Court.
3. The brief facts of the case are as follows:-
ThatRamadas, aged about 48 years, was working as a Typesetting Assistant in Computer Section of the Mysore Printers Limited (Deccan Herald). On 27th July, 1999 at about 1.30 a.m. while he was returning home on his scooter bearing Registration No.KA 03/K 7514 on Hosur-Luskar road, near Mico Software, he met with accident with a Tanker bearing Registration No.KA 05/A 5995 driven by its driver in a rash and negligent manner. On account of the said accident, Ramadas fell down and sustained grievous injuries all over the body. He was shifted to Victoria Hospital, where he succumbed to the injuries.
4. His wife and children preferred the claim petition under Section 166 of the Motor Vehicles Act, 1988 (hereinafter referred to as the 'Act, 1988), claiming compensation of Rs.30,00,000/-. The 2nd respondent (Insurance Company) contested the claim. They had not disputed the accident or the insurance coverage. On behalf of the claimant, witnesses were examined including P.W-1, who was the claimant No.1 and another one Chandrashekar, an eye-witness to the accident. Nine documents were led as evidence marked as Exhs.P1 to P9. No oral evidence was adduced by the respondents. The Insurance Policy was marked as Exh.R1.
5. The Tribunal on appreciation of the oral and documentary evidence on record held that the accident was occurred on account of rash and negligent driving by the driver of the Tanker. It took into consideration the fact that the deceased was drawing a salary of Rs.13,331/- p.m. After deduction of the Income Tax, Professional Tax and personal expenses from the basic salary it awarded a compensation of Rs.9,03,600/-.
6. On appeal preferred by the claimants, the High Court enhanced the compensation to Rs.11,25,000/-. The High Court rounded the age of the deceased as 50 years; applied Rs.8,295/- as multiplicand and deducted 1/3rd amount towards personal expenses. The High Court split the multiplier and applied multiplier of 10 for the multiplicand of Rs.8,295/- and multiplier of 2 for the multiplicand of Rs.4,147/-.
7. The grievances of the claimants are summarised as follows:-
(i) Deduction of 1/3rd amount towards personal expenses in all cases is arbitrary and unreasonable.
(ii) Multiplier under Second Schedule cannot be applied in for determination of compensation under Section 166 of the Motor Vehicles Act, 1988.
iii) Split multiplier cannot be made applicable in the facts of the case.
iv) Interest granted by the Tribunal and the High Court is lower side which should be 9% in place of 6% per annum.
At the time of argument learned counsel for the appellants insisted to issue a direction on the authority to comply with Section 158 (6) and 166 (4) of the Act, 1988. Further prayer was made to direct the Central Government to amend the Second Schedule of the Act, 1988 in light of the present cost of living which increased manifold.
8. Per contra, according to the counsel for respondent No.2-Oriental Insurance Co. Ltd. (hereinafter referred to as, “the Insurance Company”) the compensation paid in favour of the claimants is just and proper, multiplier method is sound method of assessing compensation; Section 163(A) directs to follow a structured formula indicated in Second Schedule to avoid long drawn litigation and delay in payment of compensation; there is consistency and uniformity in the said approach.
9. Before we refer to the broad features of th
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