REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.  105        OF 2009 [Arising out of SLP (Civil) No. 6227 of 2006]

Mohan Singh …Appellant

Versus

Kashi Bai & Ors. …Respondents

J U D G M E N T  

S.B. SINHA, J :

1. Leave granted.

2. Appellant  before  us  is  the  driver  and  owner  of  the  jeep  bearing

registration No. MP-04J 1824 which met with an accident on 21.11.1999

having  collided  with  a  truck.   The  deceased  Balma  @  Balram  Gond,

Ramgopal and Shankarlal admittedly were travelling in the said vehicle.

3. A  First  Information  Report  was  lodged.   The  heirs  and  legal

representatives of the deceased filed applications for grant of compensation

in  terms of Section 166 of the Motor Vehicles  Act,  1988 (for short “the

Act”) which was marked as Claim Case Nos. 76, 78 and 79 of 2002.

4. The learned Tribunal,  having regard to the rival  contentions of the

parties, framed the following issues:

“1. Whether on 21.11.99 in the night at about 8 a.m.  near  village  Semri,  non  applicant  No.  1 driving  Jeep  No.  MP04  1824  and  truck  No. MP04K2028  driven  negligently  and  rashly  the collision between the two vehicle occurred and in the result Shankarlal died.   2. Whether there was contributory negligence on the part of both the drivers? If so, effect. 3. At 8 p.m. Jeep No. MP04J1824 was dashed by truck No. MP04 K 2028 and the accident was caused, if so, effect.. 4. Whether  applicants  are  entitled  for compensation. 5. Relief & Cost.”

5. The  learned  Tribunal  upon  consideration  of  the  depositions  of  the

witnesses held that neither the truck No. MP04K 2028 was involved in the

accident, nor was it caused on account of rash and negligent driving on the

part of its driver.  The learned Tribunal passed awards in all the three cases

as under:

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Claim Case No. 76 of 2002 Rs. 1,32,000/-

Claim Case No. 78 of 2002 Rs. 1,92,000/-

Claim Case No. 79 of 2002 Rs. 4,22,400/-

6. Appeals were preferred thereagainst by the appellant.  By reason of

the  impugned  judgment,  the  High  Court,  however,  reversed  the  said

findings, holding:

“16. Coming  to  question  of  negligence,  though Mohan Singh and two other  witnesses  examined by the  claimant  has  stated  that  it  was  the  truck driver who drove it in rash and negligent manner. However,  in  the  claim  petition,  it  was  rightly mentioned that jeep driver also drove it in rash and negligent  manner  and  the  accident  took  place when  two  vehicles  dashed  against  each  other. Both were coming from opposite direction, thus, it was  the  duty  of  both  the  drivers  to  avoid  the collision  in  which  they  have  failed.   Thus,  we come  to  the  conclusion  that  it  is  a  case  of contributory  negligence  in  equal  proportion  of both drivers.”

Although  we  are  of  the  opinion  that  the  High  Court  in  doing  so

should  have  considered  the  matter  at  some  details  and  it  was  further

required to assign some reasons in support thereof, but, it is not necessary

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for us to consider that aspect of the matter as the owner or the insurer of the

truck having not preferred any appeal, the same has attained finality.   

In this appeal we are concerned with only one question, viz., as to

whether  any case  has  been made out  for  enhancement  of  the amount  of

compensation in favour of the appellant.   

7. So far  as the  quantum of compensation  is  concerned,  the  Tribunal

proceeded on the basis that the age of the deceased Shankarlal was 35 years.

His monthly income was assessed at Rs. 1500/- per month.  One-third of the

said  amount  was  deducted  as  his  personal  expenditure.   Applying  the

multiplier  of  10,  it  was  held  that  the  applicants  were  entitled  to

compensation of Rs. 1,20,000/-.   

As regards  the quantum of  compensation  payable  to  the  heirs  and

legal  representatives  of  the  deceased  Balma  is  concerned,  the  loss  of

dependency was  determined  at  Rs.  12,000/-  per  annum by the  Tribunal.

Having regard to the fact that he was aged 25 years, the multiplier of 15 was

used to  hold that  a compensation  for  a sum of Rs.  1,92,000/-  should be

granted.   

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The  deceased  Ram  Gopal  was  aged  31  years  at  the  time  of  the

accident.   A  multiplier  of  12  was  used  in  his  case  and  the  amount  of

compensation  of  Rs.  4,22,400/-  was  held  to  be  payable  to  him  on  the

premise that the loss of dependency was Rs. 34,200/- per annum.   

8. The  High  Court,  however,  although  did  not  interfere  with  these

finding of facts, applied the multiplier of 17 in all the cases.

9. Mr. Shiv Sagar Tiwari,  learned counsel  appearing on behalf of the

appellant would contend that the High Court committed a serious error in

holding that the multiplier of 17 should be applied in modification of the

order of the Tribunal.

10. The liability to  pay compensation in  a case where a vehicle  meets

with an accident is principally that of the owner thereof.   The age of the

deceased as also the loss of dependency suffered by his heirs respectively

and legal representatives is seriously not in dispute.   

11. The core question, therefore, which arises for consideration is as to

whether  the  multiplier  specified  in  the  table  contained  in  the  Second

Schedule  appended  to  the  Act  should  have  been  applied.   Although  the

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Second Schedule is applicable only in respect of the claim petitions filed

under Section 163A of the Act, indisputably, the same provides for some

guidelines.   In  a  case  where  the  deceased  was  above  25  years  but  not

exceeding 30 years, in terms of the said Second Schedule, the multiplier of

18 is to be applied.  In the case of the deceased whose age was above 30

years but not exceeding 35 years, the multiplier of 17 in terms of the Second

Schedule  is  required  to  be  applied.   The  High  Court,  therefore,  in  our

opinion, has applied the correct multiplier.  The quantum of multiplicand, as

noticed hereinbefore, is not in question.  In a case of this nature, it is not

necessary to go into the larger question, viz., as to whether the courts should

apply the multiplier specified in the Second Schedule in a proceeding under

Section 166 of the Act.

12. In  General  Manager,  Kerala  State  Road  Transport  Corporation,

Trivandrum v.  Susamma Thomas and others,  [(1994)  2  SCC 176] apart

from applying the structured formula for  determination  of the amount of

compensation  with  regard  to  the  future  prospect  of  the  deceased,  it  was

opined :-

 “19. In the present case the deceased was 39 years of  age.  His  income was Rs 1032  per  month.  Of

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course, the future prospects of advancement in life and  career  should  also  be  sounded  in  terms  of money  to  augment  the  multiplicand.  While  the chance  of  the  multiplier  is  determined  by  two factors, namely, the rate of interest appropriate to a stable economy and the age of the deceased or of the  claimant  whichever  is  higher,  the ascertainment  of  the  multiplicand  is  a  more difficult exercise. Indeed, many factors have to be put into the scales to evaluate the contingencies of the future. All contingencies of the future need not necessarily  be  baneful.  The  deceased  person  in this case had a more or less stable job. It will not be inappropriate to take a reasonably liberal view of the prospects of the future and in estimating the gross income it  will  be unreasonable  to  estimate the  loss  of  dependency  on  the  present  actual income of Rs 1032 per month. We think, having regard  to  the  prospects  of  advancement  in  the future  career,  respecting  which  there  is  evidence on  record,  we  will  not  be  in  error  in  making  a higher estimate of monthly income at Rs 2000 as the gross income. From this has to be deducted his personal  living  expenses,  the  quantum of  which again depends on various factors such as whether the style of living was spartan or bohemian. In the absence  of  evidence  it  is  not  unusual  to  deduct one-third of the gross income towards the personal living  expenses  and  treat  the  balance  as  the amount likely to have been spent on the members of  the  family  and  the  dependents.  This  loss  of dependency should capitalize with the appropriate multiplier. In the present case we can take about Rs 1400 per month or Rs 17,000 per year as the loss  of  dependency  and  if  capitalized  on  a multiplier of 12, which is appropriate to the age of the deceased, the compensation would work out to (Rs 17,000 x 12 = Rs 2,03,000)  to  which  is added the usual award for loss of consortium and

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loss of the estate each in the conventional sum of Rs 15,000.”

In Kaushnuma Begum  v.  New India Assurance Co. Ltd., [ (2001) 2

SCC 9 ] this Court observed:-

22. The appellants claimed a sum of Rs 2,36,000. But  PW 1 widow of  the  deceased  said  that  her husband’s income was Rs 1500 per month. PW 4 brother  of  the deceased  also supported  the same version. No contra-evidence has been adduced in regard to that aspect. It is, therefore, reasonable to believe that  the monthly income of the deceased was  Rs. 1500.  In  calculating  the  amount  of compensation  in  this  case  we  lean  ourselves  to adopt  the  structured  formula  provided  in  the Second Schedule to the MV Act.  Though it  was formulated for the purpose of Section 163-A of the MV Act, we find it a safer guidance for arriving at the  amount  of  compensation  than  any  other method so far as the present case is concerned.”

In  United  India  Insurance  Co.  Ltd.  v.   Patricia  Jean  Mahajan, [ (2002) 6 SCC 281 ], however, this Court held :-  

“21. The purpose to compensate the dependants of the  victims  is  that  they  may  not  be  suddenly deprived of the source of their maintenance and as far  as  possible  they  may  be  provided  with  the means  as  were  available  to  them  before  the accident  took  place.  It  will  be  a  just  and  fair compensation. But in cases where the amount of compensation  may  go  much  higher  than  the

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amount  providing  the  same  amenities,  comforts and  facilities  and  also  the  way  of  life,  in  such circumstances also it may be a case where, while applying  the  multiplier  system,  the  lesser multiplier  may  be  applied.  In  such  cases,  the amount  of  multiplicand  becomes  relevant.  The intention is not to overcompensate.

22. We  therefore,  hold  that  ordinarily  while awarding compensation,  the provisions contained in the Second Schedule may be taken as a guide including the multiplier, but there may arise some cases,  as the one in hand,  which may fall  in  the category  having  special  features  or  facts  calling for  deviation  from  the  multiplier  usually applicable.”

It is evident from the above that this Court in the said decisions had

taken a departure from the Second Schedule.  

In  Jyoti Kaul  v.  State of M.P., [ (2002) 6 SCC 306 ] multiplier of 15

was adopted, stating :-  

 “The  aforesaid  decision  makes  it  clear  that  the principle of multiplier would depend on the facts and  circumstances  of  each  case.  Looking  to  the facts  of  this  case  we find  that  the  Tribunal  has given good reasons for applying the multiplier of 15.  This  was  in  addition  of  taking  into consideration that the predecessors of the deceased all lived for more than 80 years. The High Court reduced  the  multiplier  from  15  to  10  without taking  into  consideration  circumstances considered by the Tribunal and thus committed the error.  We, accordingly,  set  aside  the findings  of

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the  High  Court  only  to  the  extent  of  the application of multiplier and uphold other findings including reduction of interest. The present appeal, accordingly, succeeds in part. The computation of compensation now shall be made on the basis of multiplier  of  15.  The  difference  of  enhanced amount  which  has  yet  not  been  paid  by  the respondent  State  shall  be  paid  to  the  claimants within a period of three months from today.”

In Smt. Supe Dei & Ors. v. M/s. National Insurance Co. Ltd. & Anr.

[JT 2002 (Suppl.1) SC 451], this Court held:

“…While  considering  the  question  of  just compensation payable in a case all relevant factors including the appropriate multiplier are to be kept in  mind.  The  position  is  well  settled  that  the second  schedule  under  Section  163A to  the  Act which  gives  the  amount  of  compensation  to  be determined  for  the  purpose  of  claim  under  the section  can  be  taken  as  a  guideline  while determining the compensation under Section  166 of the Act. In that view of the matter, there is no reason why multiplier of 17 should not be taken as the appropriate multiplier in the case.”

In  Abati  Bezbaruah v.  Dy. Director  General,  Geological  Survey of

India and Another [(2003) 3 SCC 148], this Court held:  

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“11.  It  is  now a well-settled  principle  of  law that the payment of compensation on the basis of structured  formula  as  provided  for  under  the Second Schedule should not ordinarily be deviated from. Section 168 of the Motor Vehicles Act lays down  the  guidelines  for  determination  of  the amount of compensation in terms of Section 166 thereof.  Deviation  from  the  structured  formula, however, as has been held by this Court, may be resorted to in exceptional cases. Furthermore, the amount of compensation should be just and fair in the facts and circumstances of each case.

12.  The  victim  at  the  relevant  time  was  40 years  of  age.  The  Tribunal  and the  High  Court, therefore,  cannot  be  said  to  have  committed  an error  in  applying  the  multiplier  of  15.  The  only question which is required to be considered now is as to how the multiplicand should be arrived at.

13. The deceased at the time of accident was a young  man.  He  had  a  stable  job.  A  reasonably liberal  view of his  future prospects  should have, therefore,  been  taken  into  consideration  by  the High Court as well as by the Tribunal.

14.  Having  regard  to  the  prospects  and advancement  of  the  future  career,  a  higher estimate of the yearly income at Rs.45,000 would not  be out of place.  From the said amount,  one- third of the gross income towards personal living expenses  should  be  deducted.  The  amount  of Rs 30,000 should thus be determined as the loss of dependency.  The  said  sum should  be capitalized by applying the multiplier of 15, which comes to Rs 4,50,000.”

In Kanhaiyalal Kataria and Others v. Mukul Chaturvedi and Others

[(2005) 12 SCC 190], this Court held:

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“3.  Learned  counsel  for  the  claimants  made submissions  seeking  enhancement  of compensation on the ground that the income of the deceased has not been properly estimated. We are not going into any other aspect except the question of  proper  multiplier  for  computation  of compensation.  In  our  opinion,  by  taking  the multiplier  of  17,  the  amount  of  compensation deserves  to  be  increased.  The  compensation amount  may  be  suitably  recomputed  by  the Tribunal  by  applying  the  multiplier  of  17  and interest at the rate of 12 per cent per annum on the increased amount be also granted.”

In Bilkish v. United India Insurance Company Limited and Another

[(2008) 4 SCC 259], this Court held:

“4.  After  hearing  learned  counsel  for  the parties, we are of the opinion that the view taken by the High Court and the Tribunal is not correct. The incumbent was a bachelor  and he could not have spent more than 1/3rd of his total income for personal use and rest of the amount earned by him would certainly go to the family kitty. Therefore, determining the loss of dependency by 50% was not correct. Therefore, we assess that he must be spending  1/3rd  towards  personal  use  and contributing  2/3rd  of  his  income  to  his  family. Therefore, we work out that Rs 30,000  was earned by him per annum. The loss of dependency was 2/3rd i.e. Rs 20,000.  The  multiplier  of  ‘11’ applied  for  loss  of  dependency  was  also  not correct and as per Schedule appended to the Motor Vehicles Act, 1988 it should be ‘12’. Applying the multiplier of 12 the total loss of dependency will

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be Rs 20,000 x 12 = Rs 2,40,000 and Rs  10,000  towards  loss  of  estate  and  funeral expenses,  the  total  compensation  comes  to Rs 2,50,000 and incumbent is entitled for interest @  9%  p.a.  from  the  date  of  the  petition.  The appeal is allowed with the aforesaid modification.”

13. We, therefore, keeping in view the aforementioned peculiar facts and

circumstances of the case, are of the opinion that the judgment of the High

Court in applying the multiplier of 17 need not be interfered with.

14. For the reasons aforementioned, there is no merit in this appeal which

is dismissed accordingly.  However, in the facts and circumstances of the

case, there shall be no order as to costs.

………………………….J. [S.B. Sinha]

..…………………………J.     [Cyriac Joseph]

New Delhi; January 13, 2009

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