R. VALLI & ORS versus TAMIL NADU STATE TRANSPORT CORPORATION LTD. on 10 February 2022

1. The legal heirs of deceased V. Rajasekaran are in appeal hereinbeing aggrieved against an order passed by the High Court of Judicatureat Madras dated 7.11.2017 granting a compensation of Rs.15,12,628/-along with an interest @ 7.5% from the date of petition till the date of H

[2022] 1 S.C.R.

Arealization on account of the death of the deceased in a motor vehicleaccident on 22.02.2011.

2. The deceased was riding a two-wheeler when a bus belongingto the respondent dashed into his vehicle. The deceased suffered headinjuries and died instantly. He was born on 11.4.1956 and was 54 yearsBold on the date of accident. On the basis of income and age, the MotorAccident Claim Tribunal, Chennai[1] awarded a compensation ofRs.13,82,628/-.

3. The Tribunal held that the accident occurred due to rash andnegligent driving of the bus driver. The appellant examined PW-3, theCAssistant Manager of M/s Areva T & D India Limited. He deposed thatthe deceased was paid salary of Rs.23,062.30. The salary certificatewas produced as Ex.P.9. The learned Tribunal assessed the income atRs.23,062/-. Further observing that the age of superannuation was 58years, therefore, the dependency was only for a period of 3 years. Afterdeducting income tax @10%, monthly income was assessed asDRs.20,756/-. The Tribunal deducted 1/4[th] of the said amount towardspersonal expenses and awarded a compensation of Rs.5,60,412/- forthe period the deceased was to be in employment and thereafter applieda multiplier of 8 on 50% of the income which he would have earned andawarded a sum of Rs.7,47,216/-. The Tribunal also awardedEcompensation on the conventional heads and thus awarded a total sumof Rs.13,82,628/-.

4. The High Court affirmed the findings recorded by the learnedTribunal in respect of multiplier of 3 upto the date of superannuation andthereafter multiplier of 8 keeping in view the dependency of life for 10Fyears. The High Court maintained the amount of compensation onaccount of dependency but enhanced the compensation under theconventional heads, so as to award a sum of Rs.15,12,628/-.

5. Learned counsel for the appellants argued that the multipliermethodology adopted by the Tribunal and affirmed by the High CourtGwas erroneous and not sustainable. It was contended that the multiplieris applied keeping in view the age of deceased and income at the time ofdeath and not by considering the remaining years of service. It wasargued that if a person who dies in an accident is 31 years of age and 1 For short, the ‘Tribunal’H

R. VALLI v. TAMIL NADU STATE TRANSPORT CORP. LTD.

[HEMANT GUPTA, J.]

has 27 years of service left, the multiplier is not 28 years but keeping inview the judgment of this Court in Sarla Verma (Smt.) & Ors. v. DelhiTransport Corporation & Anr.[2], the age of the deceased at the time ofdeath is the base for choosing a multiplier and not the years left inemployment. It was held as under:

“42. We therefore hold that the multiplier to be used should be asmentioned in Column (4) of the table above (prepared by applyingSusamma Thomas [(1994) 2 SCC 176 : 1994 SCC (Cri) 335] ,Trilok Chandra [(1996) 4 SCC 362] and Charlie [(2005) 10SCC 720 : 2005 SCC (Cri) 1657] ), which starts with an operativemultiplier of 18 (for the age groups of 15 to 20 and 21 to 25 years),reduced by one unit for every five years, that is M-17 for 26 to 30years, M-16 for 31 to 35 years, M-15 for 36 to 40 years, M-14 for41 to 45 years, and M-13 for 46 to 50 years, then reduced by twounits for every five years, that is, M-11 for 51 to 55 years, M-9 for56 to 60 years, M-7 for 61 to 65 years and M-5 for 66 to 70years.”

6. The judgment in Sarla Verma was affirmed in Reshma Kumari& Ors. v. Madan Mohan & Anr.[3]. Both the judgments were affirmedby the Constitution Bench of this Court reported as National InsuranceCompany Limited v. Pranay Sethi & Ors.[4]. This Court in PranaySethi held as under:

“44. At this stage, we must immediately say that insofar as theaforesaid multiplicand/multiplier is concerned, it has to be acceptedon the basis of income established by the legal representatives ofthe deceased. Future prospects are to be added to the sum on thepercentage basis and “income” means actual income less the taxpaid. The multiplier has already been fixed in Sarla Verma [SarlaVerma v. DTC, (2009) 6 SCC 121 : (2009) 2 SCC (Civ) 770 :(2009) 2 SCC (Cri) 1002] which has been approved in ReshmaKumari [Reshma Kumari v. Madan Mohan, (2013) 9 SCC 65 :(2013) 4 SCC (Civ) 191 : (2013) 3 SCC (Cri) 826] with which weconcur.

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2 (2009) 6 SCC 1213 (2013) 9 SCC 654 (2017) 16 SCC 680

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A59.3 While determining the income, an addition of 50% of actualsalary to the income of the deceased towards future prospects,where the deceased had a permanent job and was below the ageof 40 years, should be made. The addition should be 30%, if theage of the deceased was between 40 to 50 years. In case thedeceased was between the age of 50 to 60 years, the additionBshould be 15%. Actual salary should be read as actual salary lesstax.

59.4 In case the deceased was self-employed or on a fixed salary,an addition of 40% of the established income should be the warrantwhere the deceased was below the age of 40 years. An additionCof 25% where the deceased was between the age of 40 to 50years and 10% where the deceased was between the age of 50to 60 years should be regarded as the necessary method ofcomputation. The established income means the income minusthe tax component.

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59.7. The age of the deceased should be the basis for applyingthe multiplier.”

7. In Pranay Sethi, this Court held that the age of the deceased isthe basis for applying suitable multiplier and that the compensation is toEbe determined keeping in view the future prospects. The future prospectswere held to 15% in respect of a deceased between the age of 50 to 60years.

8. Mr. Amit Anand Tiwari, learned Additional Advocate Generalhas referred to certain orders of the High Courts reported as UmaFShankar & Ors. v. Revathy Vadivel & Ors.[5], Smt. Kamlesh Devi &Ors. v. Sh. Kitab Singh & Ors.[6]and Union of India & Ors. v. K.S.Lakshmi Kumar & Ors.[7]to support the applicability of split multiplieri.e., multiplier upto the date of retirement and another multiplier afterretirement.

G9. The judgments referred to by Mr. Tiwari are prior to theenunciation of law by this Court in Pranay Sethi. Therefore, suchjudgments no longer can be said to be good law as suitable multiplier is 5 2014 SCC OnLine Mad 8466 2011 SCC OnLine Del 2843H7 2000 SCC OnLine Kar 406

to be applied keeping in view the age of the deceased in terms of para59.7 of the judgment in Pranay Sethi.

10. A three-Judge Bench in an order reported as United IndiaInsurance Co. Ltd. v. Satinder Kaur alia Satwinder Kaur & Ors.[8]has applied the multiplier keeping in view the age of the deceased evenif he was a bachelor. The Court held as under:

“48. Another three-judge bench in Royal Sundaram AllianceInsurance Co. Ltd. v. Mandala Yadagari Goud, (2019) 5 SCC554 traced out the law on this issue, and held that the compensationis to be computed based on what the deceased would havecontributed to support the dependants. In the case of the death ofa married person, it is an accepted norm that the age of thedeceased would be taken into account. Thus, even in the case ofa bachelor, the same principle must be applied.”

11. Thus, we find that the method of determination of compensationapplying two multipliers is clearly erroneous and run counter to thejudgment of this Court in Pranay Sethi, affirming the judgment in SarlaVerma. Since the deceased was 54 years of age on the date of incident,therefore, the suitable multiplier would be 11 as per the judgment of thisCourt in Sarla Verma approved by this Court in Pranay Sethi.

12. Hence, the compensation on the basis of income assessed bythe Tribunal would be as under:

8 2020 SCC OnLine SC 410

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A13. Thus, the appellants are found entitled to compensation of Rs.24,33,064/- with interest @ 9% from the date of filing of the claimapplication till realisation.

14. The appeal thus stands disposed of with costs throughout.

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Devika Gujral

Appeal disposed of.

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