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2023 Supreme(Del) 3576

IN THE HIGH COURT OF DELHI AT NEW DELHI
Navin Chawla, J.
United India Insurance Company Limited – Appellant
Versus
Sh. Jamaluddin Khan & Ors. – Respondents
MAC.APP. 273 of 2020 & CM APPL. 33433 of 2020
Decided On : 25-08-2023

Advocates appeared:
Mr.Pradeep Gaur, Advocate, for the Appellant.
Mr.Dev Bhardwaj, Advocate, for the Respondent-1 & 2.
Mr.Sarfaraz Khan, Advocate, for the Respondent-5.

The main legal point established in the judgment is the application of the multiplier method and the use of minimum wages for determining notional income in cases of motor accidents involving the death of a child.

Headnote:

Motor Accidents - Compensation - [Chetan Malhotra] - [Motor Accidents Compensation] - [R.K. Malik & Anr. v. Kiran Pal & Anr., (2009) 14 SCC 1; Kajal v. Jagdish Chand & Ors., (2020) 4 SCC 413; Master Ayush v. Branch Manager, Reliance General Insurance Co. Ltd. & Anr., (2022) 7 SCC 738; Minor Roopa v. The Divisional Manager, New India Assurance Company Ltd., Civil Appeal No.5069 of 2022; Rajendra Singh and Others v. National Insurance Company Limited and Others, (2020) 7 SCC 256; National Insurance Company Limited v. Pranay Sethi And Others, (2017) 16 SCC 680; Sarla Verma (Smt) & Ors. v. Delhi Transport Corporation & Anr., (2009) 6 SCC 121; United India Insurance Co. Ltd. v. Satinder Kaur alias Satwinder Kaur & Ors., (2021) 11 SCC 780] - The court discussed the principles governing the determination of compensation payable in cases of motor accidents, particularly in the context of the death of a child. It emphasized the use of the multiplier method for assessing loss of dependency and the application of minimum wages notified by the State Government for determining notional income. The court also addressed the deduction towards personal and living expenses and the award of interest on the compensation amount.

Fact of the Case:

The claim petition arose from the untimely death of a child in a road accident due to the vehicle being driven in a rash and negligent manner. The appellant challenged the compensation amount determined by the Tribunal based on the judgment in Chetan Malhotra v. Lala Ram & Ors., 2016 SCC OnLine Del 2981.

Finding of the Court:

The court found that the judgment in Chetan Malhotra was no longer applicable to the case and set aside the Impugned Award. It laid down principles for determining compensation, including the use of the multiplier method and the application of minimum wages for notional income. The court also addressed the deduction towards personal and living expenses and the rate of interest on the compensation amount.

Issues: The issues included the determination of compensation payable for the death of a child in a motor accident, the applicability of previous judgments, and the appropriate methodology for assessing loss of dependency.

Ratio Decidendi: The court held that the multiplier method should be applied for assessing loss of dependency, and the notional income of a child should be determined based on the minimum wages notified by the State Government. It also ruled on the deduction towards personal and living expenses and the rate of interest on the compensation amount.

Final Decision: The Impugned Award was set aside, and the matter was remanded back to the Tribunal for a fresh determination of the compensation to be awarded in accordance with the principles laid down by the court.

JUDGMENT

Navin Chawla, J. (Oral)--The appellant challenges the Award dated 26.09.2020 (hereinafter referred to as the `Impugned Award') passed by the learned Motor Accidents Claims Tribunal (South-District), Saket Courts, New Delhi (hereinafter referred to as the `Tribunal') in Petition no. 323/2018, titled Sh.Jamaluddin Khan & Anr v. Sh. Gyanender Singh Sirohi & Ors..

2. The claim petition arose out of the Detailed Accidents Report (`DAR') filed by the SHO, Police Station: Ambedkar Nagar, for the untimely death of a child, namely Shamim, aged about 15 years and 8 months, in a road accident on 04.12.2017 due to the vehicle bearing no.DL-1PC-3123 being driven in a rash and negligent manner by the respondent no.3 herein.

3. The limited challenge of the appellant to the Impugned Award is on the amount of Rs.4.89 lakhs and the equivalent amount determined by the learned Tribunal as compensation towards loss of dependency and non-pecuniary damages respectively based on the judgment of this Court in Chetan Malhotra v. Lala Ram & Ors., 2016 SCC OnLine Del 2981.

4. Placing reliance on the judgment of the Supreme Court in Rajendra Singh and Others v. National Insurance Company Limited and Others, (2020) 7 SCC 256; and of this Court in National Insurance Co. Ltd. v. Master Shaurya & Ors., Neutral Citation no. 2023:DHC:5355, he submits that, even in case of death of a child, notional income of only Rs.36,000/- per annum (by the Supreme Court) and Rs.50,982/- (by this Court) has been considered as reasonable for determining the compensation.

5. The learned counsel for the respondent nos.1 and 2 does not seriously oppose the plea of the appellant that the judgment of this Court in Chetan Malhotra (Supra) would not be applicable to the facts of the present case. He, however, submits that the compensation amount has to be determined on a reasonable basis and for this purpose, the multiplier method be adopted by this Court. He also admits that there can be a deduction towards the personal expenses equivalent to 2/3rd of the assessed amount.

6. I have considered the submissions made by the learned counsels for the parties.

7. As the learned Tribunal has determined the compensation payable to the Claimant/respondent no.1 herein by placing reliance on the judgment of this Court in Chetan Malhotra (supra), and as the learned counsel for the respondent no. 1 agrees with the submission of the learned counsel for the appellant that the said judgment would no longer be applicable, the Impugned Award cannot be sustained and is liable to be set aside.

8. One course open to this Court thereafter is to remand the Claim Petition to the learned Tribunal for a fresh determination of the compensation payable to the Claimants. However, in the facts of the present case, I deem it proper to lay down the principles that would govern the learned Tribunal in determining the compensation payable to the respondent no. 1 and 2.

9. As noted herein above, the learned counsel for the appellant has submitted that only notional compensation is to be awarded in favour of the respondent no. 1. He has submitted that as the respondent no. 1 was aged only 15 years, there cannot be any loss of income attributed to the accident for awarding compensation.

10. I do not find any merit in the submission of the learned counsel for the appellant.

11. In R.K. Malik & Anr. v. Kiran Pal & Anr., (2009) 14 SCC 1, the Supreme Court, considering the claims arising on account of death of children, held as under:

    "8. Undoubtedly, the compensation in law is paid to restore the person, who has suffered damage or loss in the same position, if the tortious act or the breach of contract had not been committed. The law requires that the party suffering should be put in the same position, if the contract had been performed or the wrong had not been committed. The law in all such matters requires payment of adequate, reasonable and just monetary compensation.

    9. In cases of motor accidents the

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