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2009 Supreme(UK) 54
2009 (2) UAD 116
SUPREME COURT OF INDIA
Hon’ble Dr. Justice Arijit Pasayaat and Hon’ble Mr. Justice Asok Kumar Ganguly
Civil Appeal No. 1069 of 2009
UTTARANCHAL TRANSPORT CORP. LTD. – Appellants
Versus
VIMLA DEVI & ORS. – Respondents
Decided on : 16.02.2009
Headnote:(A) Motor Vehicles Act, 1988, Secs. 163-A, 166, 168 — Motor Accident — Multiplier — Applicability of —The highest multiplier was held to be 18, for the age group of 21 year to 25 years when an ordinary Indian citizen starts independently earning and the lowest would be in respect of a person in the age group of 60 to 70, which is the normal retirement age. (Para 13)
(B) Motor Vehicles Act, 1988, Secs. 166, 168 — Motor Accident — Claim for compensation — Calculation of compensation — Application of Proper Multiplier — The High Court held that the deceased would have easily earned Rs. 3,000/- p.m. — Accordingly, after making 1/3rd deduction for personal expenses the loss of dependency was assessed at Rs. 24,000/- p.a. and multiplier of 15 was adopted — Considering the age of deceased — Multiplier as adopted by High Court appears to be on higher side — Appropriate to fix the multiplier at 10 and the rate of interest 6% p.a. — Taking an overall view of the matter, adopted the multiplier at 10 and fixed the quantum of Rs. 2,40,000/- with 6% interest from date of claim. (Paras 15, 16)
¼v½ eksVj okgu vf/kfu;e] 1988] /kkjk&163-A, 166] 168 & eksVj okgu nq?kZVuk & xq.kd dh iz;ksT;rk & mPpre xq.kd] 21 ls 25 o"kZ dh vk;q Js.kh ds okLrs 18 ekuk x;k gS tc fd ,d lk/kkj.k Hkkjrh; Lora= :i ls viuh vkthfodk dekuk izkjaHk djrk gS vkSj U;wure ,sls O;fDr ds fy, tks 60 ls 70 o"kZ dh vk;q dh Js.kh esa vkrk gks tks fd lkekU; lsok fuo`fRr vk;q gSA ¼izLrj 13½
¼c½ eksVj okgu vf/kfu;e] 1988] /kkjk&166] 168 & eksVj nq?kZVuk esa eqvkots dk nkok & eqvkots dh x.kuk & mfpr xq.kd dk iz;ksx fd;k tkuk & mPp U;k;ky; dk fu.kZ; Fkk fd e`rd #d 3,000/- ekfld dek ldrk Fkk & bl ds vk/kkj ij O;fDrxr [kpks± ds fy, 1@3 dh dVkSrh djds fuHkZjrk dh gkfu dk vkadyu #d 24,000/- okf"kZd fd;k x;k Fkk vkSj 15 dk xq.kd viuk;k x;k Fkk & e`rd dh vk;q dk fopkj djds & mPp U;k;ky; }kjk viuk;k x;k xq.kd vf/kd yxrk gS & xq.kd dks 10 ij fu;r djuk mfpr jgsxk vkSj C;kt dh nj 6% okf"kZd gksuh pkfg, & ekeys dh lEiw.kZ ifjdYiuk djds xq.kd dks 10 eku dj dqy izfrdj dh jkf'k #d 2,40,000/- ekuh xbZ ftl ij nkos dh frfFk ls 6% okf"kZd C;kt ns; gksxkA ¼izLrj 15] 16½
Dr. Arijit Pasayat, J. — Leave granted.
2. Challenge in this appeal is to the judgment of a learned Single Judge of the Uttaranchal High Court partially allowing the appeal filed by the respondents. The appeal was filed before the High Court in terms of Section 173 of the Motor Vehicles Act, 1988 (in short the ‘Act’) seeking enhancement of the compensation as fixed by learned 1st Additional District judge-cum-Motor Accident Claims Tribunal, Haridwar. (In short the ‘MACT’). The MACT had awarded compensation of Rs. 1,84,500/- alongwith interest @ 9% p.a. from the date of claim.
3. The claim petition was filed inter-alia stating that on 2.9.2003 one Bijendra Singh (hereinafter referred to as the ‘deceased’) was riding a scooter. Suddenly, the bus owned by the present appellant-Corporation dashed against it. The vehicle was being driven in a rash and negligent manner. It is stated that the deceased was aged 43 years at the time of the accident and was a contractor and earning Rs. 12,000/- p.m. The Corporation took the stand that there was actually no rash and negligent act of the driver. When the scooter was trying to overtake the truck it lost control and the accident occurred due to negligence of the deceased. The MACT held that there was no material to establish the income as claimed and accordingly a sum was fixed at Rs. 15,000/- p.a. which is the notional income.
4. The High Court held that the notional income has to be taken at Rs. 30,000/- p.a. and since the deceased was a contractor he could have easily earned Rs. 3,000/- p.m. and accordingly after making 1/3rd deduction for personal expenses the loss of dependency was assessed at Rs. 24,000/- p.a. and multiplier of 15 was adopted. Accordingly, the compensation was fixed at Rs. 3,60,000/- with 9% interest from the date of claim.
5. In support of the appeal, learned counsel for the appellant submitted that there was no basis indicated for taking the income at Rs. 36,000/- p.a. On surmises the High Court came to the conclusion that the deceased could have earned Rs. 36,000/- p.a. There was no basis for coming to such a conclusion. It was also submitted that the multiplier adopted is high.
6. There is no appearance on behalf of the respondents in spite of service of notice.
7. There were two methods adopted to determine and for calculation of compensation in fatal accident actions. The first multiplier method mentioned in Davies v. Powell Duffregn Associated Collieries Ltd. (1942 AC 601) and the second in Nance v. British Columbia Electric Railway Co. Ltd. (1951 (2) All ER 448).
8. The multiplier method involves the ascertainment of the loss of dependency or the multiplicand having regard to the circumstances of the case and capitalizing the multiplicand by an appropriate multiplier. The choice of the multiplier is determined by the age of the deceased (or that of the claimants whichever is higher) and by the calculation as to what capital sum, if invested at a rate of interest appropriate to a stable economy, would yield the multiplicand by way of annual interest. In ascertaining this, regard should also be had to the fact that ultimately the capital sum should also be consumed-up over the period for which the dependency is expected to last.
9. The considerations generally relevant in the selection of multiplicand and multiplier were adverted to by Lord Diplock in his speech in Mallett v. Me Mongle (1969 (2) All ER 178) where the deceased was aged 25 and left behind his widow of about the same age and three minor children. On the question of selection of multiplicand Lord Diplock observed :
“The starting point in any estimate of the amount of the ‘dependency’ is the annual value of the material benefits provided for the dependants out of the earnings of the deceased at the date of his death. But...there are many factors which might have led to variations up or down in the fliture. His earnings might have increased and with them the amount provided by him for his dep
