MACMA/22/2020 of SHRIRAM GENERAL INSURANCE COMPANY LIMITED Vs BHUMIREDDY NAGESWASRI on 31 December 2024

JUDGMENT:

This appeal is directed against the order of the Chairman, Motor Vehicle Accident Claims Tribunal-cum-Principal District Judge at Kadapa (hereinafter called as ‘the Tribunal’) in M.V.O.P.No.307 of 2013 dated 26.10.2017.

2. The appellant is the insurer of the Lorry bearing No.AP 21W 3569 (hereinafter referred as “crime lorry”). The respondent Nos.1 to 4 herein are the wife, father, and children of one B.Venkata Subbaiah (hereinafter called as ‘the deceased’). The respondent Nos.5 and 6 are the owner and driver of the said crime lorry respectively.

3. For the sake of convenience, the parties hereinafter referred to as they arrayed before the tribunal.

4. The case of the claimants, in the petition before the Tribunal is that:

i). On 09.04.2010 at about 06.00 p.m., while the deceased was standing at Madduru Bus stop, the crime lorry driven by its driver/3[rd] respondent in a rash and negligent manner, dashed the deceased, resulted the deceased sustained multiple injuries. While undergoing treatment, the deceased was succumbed to injuries on 12.04.2010.

ii). The deceased was aged 30 years, hale and healthy, earning Rs.7,000/- per month by doing cultivation and contributing the same for the welfare of the family. Being legal representatives, they claimed compensation of Rs.6,00,000/- against the owner, insurer, and driver of the crime bus.

5. The respondent No.2/insurer filed written statement denying the averments in the petition and pleaded that by the time of incident the deceased was travelling in the crime lorry as unauthorized passenger; that the compensation claimed by the claimants is excessive and thereby, prayed to dismiss the petition against this respondent.

6. The Tribunal settled the following issues for enquiry based on the material:

“1.Whether the accident took place on 09.04.2010 at about 06.00 p.m. at Madduru bus stop, due to rash and negligent driving of the driver of Lorry bearing No.AP 21 W 3569 resulting in death of the deceased B.Venkata Subbaiah? about 06.00 p.m. at Madduru bus stop, due to rash and negligent driving of the driver of Lorry bearing No.AP 21 W 3569 resulting in death of the deceased B.Venkata Subbaiah?

2. Whether the claimants are entitled to claim compensation, if so to what extent and from which of the respondents? and compensation, if so to what extent and from which of the respondents? and

3. To what relief?”

7. During enquiry, on behalf of the claimants, PWs.1 to 4 were examined, Exs.A.1 to A.6 and X.1 to X.4 were marked. On behalf of the 2[nd] respondent/insurer, R.Ws.1 to 4 were examined and Exs.B.1 to B.3 were marked.

8. On the material, the Tribunal, having concluded that the accident occurred due to the rash and negligent driving of the crime lorry by its driver/3[rd] respondent, held that the claimants are entitled for the compensation of Rs.14,00,000/-, with interest at 6% per annum from the date of petition till the date of realization against the respondent Nos.1 to 3, for the death of the deceased in the accident.

9. It is against the said order; this appeal was preferred by the insurer of the crime lorry.

10. Heard Smt.A.Jayanthi, learned counsel for the appellant/insurer and Sri Kancham Guru Raja, learned counsel for the respondent Nos.1 to 4/claimants.

11. Now, the point that arises for determination is whether the quantum of compensation awarded to the claimants is just compensation, if not, it requires any interference?

12. POINT:

The only contention raised by the learned counsel for the appellant/insurer is that the Tribunal erred in calculating the compensation entitled by the claimants, thereby, the appeal is liable to the considered.

13. It is not in dispute about involvement of crime lorry, rash, and negligent driving of the 3[rd] respondent in causing the incident as well death of the deceased in the incident. It is also not in dispute that Ex.B.1 policy issued in respect of the crime vehicle is in force by the date of incident.

14. In view of the above contention, this Court perused the material available on record. It is well settled principle that the compensation should be reasonable rather than a boon or bonanza and based on reliable material on record, as observed by the Hon’ble Supreme Court in catena of pronouncements.

15. In the present case on hand, it is not in dispute that by the time of incident the deceased was aged about 30 years. It is the contention of the claimants that the deceased was earning Rs.7,000/- per month by doing cultivation and contributing the same for the welfare of the family. In the absence of any substantial proof regarding the income of the deceased, the Tribunal rightly taken the same @ Rs.5,000/- per month. Thereby, the actual income of the deceased is rightly determined at Rs.60,000/- per annum.

16. As per the decision of the Constitution Bench of the Apex Court in National Insurance Company Limited v. Pranay Sethi[1], the deductions towards personal and living expenses of the deceased, held at Paragraph No.39 as follows:

39. Before we proceed to analyse the principle for addition of future prospects, we think it seemly to clear the maze which is vividly discernible from Sarla Verma, Reshma Kumari, Rajesh, and Munna Lal Jain. Three aspects need to be clarified. The first one pertains to deduction towards personal and living expenses. In paragraphs 30, Sarla Verma lays down:- “30. Though in some cases the deduction to be made towards personal and living expenses is calculated on the basis of units indicated in Trilok Chandra4, the general practice is to apply standardised deductions. Having considered several subsequent decisions of this (2003) 3 SLR (R) 601 Court, we are of the view that where the deceased was married, the deduction towards personal and living expenses of the deceased, should be one-third (1/3rd) where the number of dependent family members is 2 to 3, one-fourth (1/4th) where the number of dependent 1 2017 (6) ALT 60 (SC)

family members is 4 to 6, and one-fifth (1/5th) where the number of dependent family members exceeds six.”

17. As per the Pranay Sethi case (referred supra), in case the deceased was self-employed, an addition of 40% should be made if the age of the deceased was below 40 years….. (emphasis supplied)

18. In the present case, as per the above-mentioned decision, 40% of actual income has to be added to the income of the deceased towards future prospects as the deceased is aged about 30 years by the date of incident, which is not in dispute. After adding 40% to the income of the deceased towards future prospects her income is determined at Rs.84,000/-(Rs.60,000/- + Rs.24,000/-).

19. In the case on hand, there are four claimants depending on the deceased, however as per the order of the Tribunal, the 2[nd] claimant died, but the same is not considered by the Tribunal and erroneously deducted 1/4[th]from the income of the deceased instead of 1/3[rd] towards

personal and living expenses, thereby, when there are only three surviving claimants depending on the deceased, the deduction towards personal and living expenses of the deceased should be 1/3[rd] from the income of the deceased. Then the quantum is determined as Rs.56,000/-.

20. Regarding just compensation, in a decision of Hon’ble Supreme Court between Sandeep Khanuja vs Atul Dande & Anr[2], at Paragraph Nos.11 and 12 held as follows :

11………it is now a settled principle, repeatedly stated and restated time and again by this Court, that in awarding compensation the multiplier method is logically sound and legally well established. This method, known as 'principle of multiplier', has been evolved to quantify the loss of income as a result of death or permanent disability suffered in an accident……...

12……… While applying the multiplier method, future prospects on advancement in life and career are taken into consideration. In a proceeding under Section 166 of the Act relating to death of the victim, multiplier method is applied after taking into 2 2017 (3) SCC 315

consideration the loss of income to the family of the deceased that resulted due to the said demise. Thus, 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 claimant, as the case may be…….

……. there should be no departure from the multiplier method on the ground that Section 110-B,Motor Vehicles Act, 1939 (corresponding to the present provision of Section 168,Motor Vehicles Act, 1988) envisaged payment of ‘just’ compensation since the multipliermethod is the accepted method for determining and ensuring payment of just compensation and is expected to bring uniformity and certainty of the awards made all over the country.”……. (emphasis supplied)

21. The appropriate multiplier applicable to the age of the deceased i.e., 30 years is 17. The total loss of dependency is determined at Rs.9,52,000/- (Rs.56,000/- x 17). Apart from that, as per the Pranay Sethi case(referred to supra) as well New India Assurance Company Limited v. Somwati[3], an amount of Rs.1,20,000/- towards spousal and parental consortium, an amount Rs.15,000/-towards funeral expenses and Rs.15,000/- towards love and affection are awarded. In total the claimants are entitled to compensation of Rs.11,02,000/-.

22. A brief exposition of the calculation made to arrive at the compensation is set out infra:

23. Therefore, in view of the forgoing discussion, this Court is of the considered opinion that the award passed by the Tribunal warrants interference by awarding compensation of Rs.11,02,000/- instead of Rs.14,00,000/-. It is needless to say that the compensation claimed as well awarded by the Tribunal on the remaining heads are not entitled by the claimants. Thus, this point is answered accordingly.

24. In the result, M.A.C.M.A. is disposed of by awarding compensation of Rs.11,02,000/- instead of Rs.14,00,000/-, to the claimants Nos.1, 3 and 4, with interest at 6% per

Conclusion

annum, with costs, from the date of petition till the date of realization against the respondent Nos.1 to 3. The appellant/insurer shall deposit the entire compensation amount within two months from the date of this judgment before the Tribunal. On such deposit, the claimant Nos.1/wife is entitled to receive an amount of Rs.5,51,000/- (half of the compensation amount), she is permitted to withdraw the same as well the claimant Nos.3 and 4 are entitled to receive the remaining compensation amount equally and they are permitted to withdraw the same with interest accrued thereon after attaining their majority, until the same shall be deposited in any Nationalized Bank by the Tribunal. The Tribunal shall proceed to pay the amount in the aforesaid terms, adjusting the amount, if any, already paid.

Interim orders granted earlier if any, stand vacated. Miscellaneous petitions pending if any, stand closed.

Date: 31.12.2024 Krs

______________________

JUSTICE V.SRINIVAS

Krs

THE HON’BLE SRI JUSTICE V.SRINIVAS

M.A.C.M.A.No.22 of 2020

(Judgment)

DATE: 31.12.2024