(Prayer: Appeal filed under Clause 15 of the Letters Patent, against the judgment dated 12.09.1997 passed by this Court in C.M.A.No.305 of 1989)
1. This appeal has been filed challenging the judgment dated 12.09.1997 passed by this Court in C.M.A.No.305 of 1989.
2. The facts arising out of this appeal are as under:
(i)There were two claim petitions, viz. M.C.O.P.Nos.1011 of 1985 and 1076 of 1985 before the Motor Accidents Claims Tribunal (V Judge, Court of Small Causes), Madras. In M.C.O.P.No.1011 of 1985, the claimants are the parents of one Ezhumalai, the deceased in that case. In M.C.O.P.No.1076 of 1985, the claimant is the widowed mother of one Sekar, the deceased in that case. Both the claim petitions arose out of a single accident. On 30.06.1985, when the deceased Sekar was driving the auto-rickshaw bearing Regn.No.TMR-4901 in which the deceased Ezhumalai was a passenger, near the junction of Jones Road-Anna Salai in Saidapet, a bus belonging to the appellant Transport Corporation bearing Registration No.TML-2554, driven by its driver in a rash and negligent manner, hit against the said auto-rickshaw resulting in the instantaneous death of the driver as well as the passenger.
(ii)The present appeal arises out of C.M.A.No.305 of 1999 relating to the claim petition filed in MCOP No.1076 of 1985 and hence we are dealing only with MCOP No.1076 of 1985.
(iii)The claimant, ie., the widowed mother of Sekar, relating to MCOP No.1076 of 1985, filed a claim petition before the Tribunal, claiming a sum of Rs.1,00,000/- as compensation. The Tribunal awarded a compensation of Rs.77,000/- with interest at the rate of 12% p.a., from the date of petition. Challenging the same, an appeal has been filed before this Court in C.M.A.No.305 of 1998 by the Transport Corporation. This Court reduced the compensation from Rs.77,000/- to Rs.49,000/-, but the interest rate fixed by the Tribunal was ordered to remain as 12%. Challenging the same, the present appeal has been filed by the widowed mother of the deceased-Sekar.
3. The only point urged by the learned counsel for the appellant is that the learned single Judge of this Court failed to consider the evidence of P.W.1-Pattammal, the widowed mother of the deceased, that her deceased son was earning a sum of Rs.40/- per day, while arriving at the probable monthly contribution of the deceased to the family, and wrongly calculated the same as Rs.300/-. He further submitted that there is no contra evidence to disprove the same.
4. The learned counsel for the respondent Transport Corporation has not disputed the negligence aspect that the driver of the Transport Corporation alone was responsible for the accident. With regard to compensation, he submitted that the award was passed in the year 1985 and the learned single Judge of this Court has correctly reduced the compensation awarded by the Tribunal from Rs.77,000/- to Rs.49,000/-, relying on various judgments which were relevant at the time of passing the judgment. He further submitted that the compensation awarded by the learned single Judge is just and reasonable and the same does not require any interference.
5. Heard the learned counsel on either side and perused the materials available on record carefully.
6. The finding of the Tribunal that the driver of the bus alone was responsible for the accident is not in dispute. With regard to compensation, the Tribunal awarded a sum of Rs.77,000/- with interest at 12% p.a., from the date of petition. Taking into consideration the evidence of P.W.1-Pattammal, the widowed mother of the deceased that the deceased was earning a sum of Rs.40/- per day, the Tribunal was of the view that the deceased would have contributed 1/3rd of the amount towards his family and accordingly arrived at the monthly contribution at Rs.400/- and the annual contribution at Rs.4,800/-. Taking into consideration of the fact that the deceased was aged 41 at the time of accident and that he was a bachelor, the Tribunal was of the view that had the deceased been alive, he would have contributed to the family for a period of 15 years. Accordingly, the Tribunal arrived at the loss of income at Rs.72,000/-. The Tribunal has further awarded a sum of Rs.5,000/- towards loss of estate. Thus the Tribunal awarded a total compensation of Rs.77,000/- with interest at the rate of 12% p.a., from the date of petition.
7. While arriving compensation in the case of death, relevant principles relating to assessment of compensation have to be taken note of. Further, the compensation awarded should be just, fair and reasonable.
8. In the case of Sarla Verma and others v. Delhi Transport Corporation and another, reported in (2009) 4 MLJ 997, the Apex Court has considered the relevant factors to be taken into consideration before awarding compensation and held as follows:
"7. Before considering the questions arising for decision, it would be appropriate to recall the relevant principles relating to assessment of compensation in cases of death. Earlier, there used to be considerable variation and inconsistency in the decisions of Courts Tribunals on account of some adopting the Nance method enunciated in Nance V. British Columbia Electric Rly. Co. Ltd. (1951) AC 601 and some adopting the Davies method enunciated in Davies V. Powell Duffryn Associated Collieries ltd., (1942) AC 601. The difference between the two methods was considered and explained by this Court in General Manager, Kerala State Road Transport Corporation Vs. Susamma Thomas AIR 1994 SC 1631: (1994) 2 SCC 176. After exhaustive consideration, this Court preferred the Davies method to Nance method. We extract below the principles laid down in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas (supra).
"In fatal accident action, the measure of damage is the pecuniary loss suffered and is likely to be suffered by each dependent as a result of the death. The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have live or the dependants may not live up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether."
"The manner of arriving at the damages is to ascertain the net income of the deceased available for the support of himself and his dependants, and to deduct therefrom such part of his income as the deceased was accustomed to spend upon himself, as regards both self-maintenance and pleasure, and to ascertain what part of his net income the deceased was accustomed to spend for the benefit of the dependants. Then that should be capitalised by multiplying it by a figure representing the proper number of year s purchase."
"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."
"It is necessary to reiterate that the multiplier method is logically sound and legally well-established. There are some cases which have proceeded to determine the compensation on the basis of aggregating the entire future earnings for over the period the life expectancy was lost, deducted a percentage therefrom towards uncertainties of future life and award the resulting sum as compensation. This is clearly unscientific. For instance, if the deceased was, say 25 years of age at the time of death and the life expectancy is 70 years, this method would multiply the loss of dependency for 45 years virtually adopting a multiplier of 45 and even if one-third or one-fourth is deducted therefrom towards the uncertainties of future life and for immediate lump sum payment, the effective multiplier would be between 30 and 34. This is wholly impermissible."
In UP State Road Transport Corporation V. Trilok Chandra (1996) 4 SCC 362, this Court, while reiterating the preference to Davies method followed in General Manager, Kerala State Road Transport Corporation V. Susamma Thomas (supra), stated thus:
"In the method adopted by Viscount Simon in the case of Nance also, first the annual dependency is worked out and then multiplied by the estimated useful life of the deceased. This is generally determined on the basis of longevity. But then, proper discounting on various factors having a bearing on the uncertainties of life, such as, premature death of the deceased or the dependent, remarriage, accelerated payment and increased earning by wise and prudent investments, etc., would become necessary. It was generally felt that discounting on various imponderables made assessment of compensation rather complicated and cumbersome and very often as a rough and ready measure, one-third to one-half of the dependency was reduced, depending on the life span taken. That is the reason why courts in India as well as England preferred the Davies formula as being simple and more realistic. However, as observed earlier and as pointed out in Susamma Thomas case, usually English courts rarely exceed 16 as the multiplier. Courts in India too followed the same pattern till recently when tribunals/courts began to use a hybrid method of using Nance method without making deduction for imponderables..... Under the formula Advocated by Lord Wright in Davies, the loss has to be ascertained by first determining the monthly income of the deceased, then deducting therefrom the amount spent on the deceased, and thus assessing the loss to the dependants of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an appropriate multiplier"
9. In the case of Syed Basheer Ahamed and others v. Mohammed Jameel and another, reported in (2009) 2 SCC 225, the Hon'ble Supreme Court held as under:
"13. Section 168 of the Act enjoins the Tribunal to make an award determining the amount of compensation which appears to be just . However, the objective factors, which may constitute the basis of compensation appearing as just, have not been indicated in the Act. Thus, the expression which appears to be just vests a wide discretion in the Tribunal in the matter of determination of compensation. Nevertheless, the wide amplitude of such power does not empower the Tribunal to determine the compensation arbitrarily, or to ignore settled principles relating to determination of compensation.
14. Similarly, although the Act is a beneficial legislation, it can neither be allowed to be used as a source of profit, nor as a windfall to the persons affected nor should it be punitive to the person(s) liable to pay compensation. The determination of compensation must be based on certain data, establishing reasonable nexus between the loss incurred by the dependants of the deceased and the compensation to be awarded to them. In a nutshell, the amount of compensation determined to be payable to the claimant(s) has to be fair and reasonable by accepted legal standards.
10. In the case on hand, P.W.1, the claimant, deposed that her deceased son was earning a sum of Rs.40/- per day out of which he would contribute Rs.35/- to her and the same is not controverted by any evidence. In fact, the Tribunal has not awarded any amount towards funeral expenses. Taking into consideration the principles enunciated in the above judgments of the Hon'ble Supreme Court, and the facts and circumstances of the present case, the judgment of this Court in CMA No.305 of 1989 dated 12.09.1997 reducing the quantum of compensation arrived at by the Tribunal, will not survive. The compensation arrived at by the Tribunal is just and reasonable and the same does not require any interference. Further, the interest rate fixed by the Tribunal at 12% p.a., from the date of petition also does not require any interference, as it was the prevailing rate of interest at the relevant point of time.
11. In the result, the judgment of this Court in CMA No.305 of 1989 dated 12.09.1997 is set aside and the Letters Patent Appeal is allowed. No costs. The appellant/claimant is entitled to the compensation of Rs.77,000/- with interest at 12% p.a., from the date of petition till the date of deposit. The respondent Transport Corporation is directed to deposit the said sum of Rs.77,000/- with interest at 12% p.a., from the date of petition till the date of deposit, to the credit of MCOP No.1076 of 1985 on the file of the Motor Accidents Claims Tribunal (V Judge, Court of Small Causes), Madras, after adjusting the amount if any already deposited, within a period of four weeks from the date of receipt of a copy of this judgment. On such deposit being made, the claimant is permitted to withdraw the entire amount from the deposit.