REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.   4795         OF 2009 (Arising out of SLP (C) No.18494 of 2007)

Priya Vasant Kalgutkar … Appellant

Versus

Murad Shaikh & Ors. … Respondents

J U D G M E N T

S.B. Sinha, J.

1. Leave granted.

2. Appellant  is  a  young girl.   She  met  with  an  accident  on  or  about  

20.9.1999 while she was aged only 9 years.  In the said accident she suffered  

the following injuries, as stated in the application filed on her behalf before  

the Motor Accidents Claims Tribunal :

1. There  is  swelling  deformity  & fracture  of  middle 3rd of Lt. thigh (femur shaft).

2. Abrasion over left frontal region.

3. Abrasion over Rt. Lateral aspect.”

3. She was treated by two doctors.  According to one of them, namely,  

Dr. Mukund, who examined himself as PW3, she suffered 10% to 15% of  

disability whereas according to the other doctor, Dr. Shivanand, she suffered  

20% to 25% of physical disability in her left lower limb.   

An  amount  of  Rs.3,00,000/-  was  claimed  by  her  by  way  of  

compensation  in  the  claim  petition  before  the  Motor  Accidents  Claims  

Tribunal under Section 166 of the Motor Vehicles Act,  1988 (hereinafter  

called and referred to for the sake of brevity as ‘the Act’).  The Tribunal,  

however,  having regard to  the evidences  brought  on record,  opining that  

permanent disability suffered by her would be 10%, a sum of Rs.40,000/-  

awarded on the said ground.  The total amount of compensation determined  

was a sum of Rs.72,785/- details of which are as under :

“Rs.18,000/-  towards  pain  and  sufferings  and agony, Rs. 12,460 towards diet and attendant  charges  and  Rs.323/-  were  awarded  towards  medical expenses.”

4. On  an  appeal  preferred  thereagainst,  the  High  Court,  without  

assigning  any  reason,  enhanced  the  amount  of  compensation  to  

Rs.1,12,000/-, stating :

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“Petitioner could be awarded Rs.30,000/- for pain  and agony, Rs.10,000/- for medical and incidental  expenses relating to treatment, Rs.15,000/- for loss  of  amenities  and  discomfort  on  account  of  disability,  Rs.27,000/-  (1500  X  18)  for  loss  of  future  earnings  on  account  of  disability  and  Rs.20,000/-  for  loss  of  marriage  prospects  on  account  of  disability.   In  all,  the  petitioner  is  entitled  to  the  compensation  of  Rs.1,12,000/-  as  against Rs.72,785/- awarded by the Tribunal.  On  the  enhanced  compensation,  the  interest  payable  shall  be  6%  p.a.  from  the  date  of  petition  till  payment.”

5. Appellant being aggrieved by and dissatisfied therewith is before us.

6. Mr. P.V.V. Shetty, learned senior counsel appearing on behalf of the  

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

awarding only a sum of Rs.1,12,000/- without taking into consideration her  

prospect of marriage.  The amount of compensation on the basis of notional  

income should not have been determined, urging that even if  she was to  

work as a labourer, she would have earned at Rs.4,000/- per month.  

7. Indisputably, she was a child at that time.  She had no earning.  What  

amount could be awarded towards future loss of earning or prospective loss  

of  earning  could  not  have  been  determined  on  the  basis  of  any  legal  

principle.  Compensation for the injuries suffered by a person in a motor  

vehicle accident can be determined either on the basis of the actual damages  

suffered  or  upon application  of  the  structured  formula.  Although for  the  

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purpose  of  invoking  the  provisions  of  Section  163A of  the  Act,  a  legal  

principle  may  be  found  in  the  Second  Schedule  thereof.   The  Second  

Schedule provides that where no income is proved, notional income for the  

purpose of payment of compensation to those who had no income prior to  

accident,  a  sum  of  Rs.15,000/-  per  annum  would  be  considered  as  the  

multiplicand.  The multiplier which was required to be applied would be 15.  

Paragraph 4 and 5 of the said Schedule reads as under :

“4.  General  damages  in  case  of  injuries  and  disabilities—

(i) Pain and sufferings :

(a) Grievous injuries  Rs.5,000

(b) Non-grievous injuries Rs.1,000

(ii) Medical expenses—actual expenses Incurred supported by bills/vouchers But not exceeding as onetime Payment Rs.15,000

5. Disability in non-fatal accidents—

The following compensation shall be payable in case  of  disability  to  the  victim  arising  out  of  non-fatal  accidents :

Loss  of  income,  if  any,  for  actual  period  of  disablement not exceeding fifty-two weeks.

PLUS either of the following :

(a) In  case  of  permanent  total  disablement  the  amount  payable  shall  be  arrived  at  by  multiplying  the  annual  loss  of  income by the  

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Multiplier applicable to the age on the date of  determining the compensation, or

(b) In case of permanent partial disablement such  percentage of compensation which would have  been  payable  in  the  case  of  permanent  total  disablement as specified under item (a) above.

Injuries  deemed  to  result  in  permanent  total  disablement/permanent  partial  disablement  and  percentage of loss or earning capacity shall be as per  Schedule  I  under  Workmen’s  Compensation  Act,  1923.”

8. Thus, under the head of disability in non-fatal accident, the amount of  

compensation can be determined only on that basis.

9. We  may,  however,  notice  that  in  Lata  Wadhwa v.  State  of  Bihar  

[(2001) 8 SCC 197], this Court held :

“11. So far as the award of compensation in case  of children is concerned, Shri Justice Chandrachud  has divided them into two groups, the first group  between the age group of 5 to 10 years  and the  second group between the age group of 10 to 15  years. In case of children between the age group of  5  to  10  years,  a  uniform sum of  Rs.50,000  has  been held to be payable by way of compensation,  to which the conventional figure of Rs.25,000 has  been  added  and  as  such  to  the  heirs  of  the  14  children,  a  consolidated  sum of  Rs.75,000  each,  has been awarded. So far as the children in the age  group of 10 to 15 years, there are 10 such children  who died on the fateful day and having found their  contribution to the family at Rs .12,000 per annum,  11  multiplier  has  been  applied,  particularly,  depending upon the age of the father and then the  conventional compensation of Rs.25,000 has been  added to each case and consequently, the heirs of  

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each of the deceased above 10 years of age, have  been  granted  compensation  to  the  tune  of  Rs.1,57,000 each. In case of the death of an infant,  there may have been no actual pecuniary benefit  derived by its parents during the child’s lifetime.  But this will not necessarily bar the parents’ claim  and  prospective  loss  will  found  a  valid  claim  provided that the parents establish that they had a  reasonable expectation of pecuniary benefit if the  child had lived. This principle was laid down by  the House of Lords in the famous case of Taff Vale  Rly. v. Jenkins and Lord Atkinson said thus:

“… all that is necessary is that a reasonable  expectation of  pecuniary  benefit  should be  entertained  by  the  person  who  sues.  It  is  quite  true  that  the  existence  of  this  expectation is an inference of fact — there  must  be  a  basis  of  fact  from  which  the  inference  can  reasonably  be  drawn;  but  I  wish to express  my emphatic  dissent  from  the proposition that it is necessary that two  of  the  facts  without  which  the  inference  cannot be drawn are, first, that the deceased  earned money in the past, and, second, that  he or she contributed to the support of the  plaintiff.  These  are,  no  doubt,  pregnant  pieces of evidence, but they are only pieces  of  evidence;  and  the  necessary  inference  can,  I  think,  be drawn from circumstances  other than and different from them.”

At  the  same  time,  it  must  be  held  that  a  mere  speculative possibility of benefit is not sufficient.  Question  whether  there  exists  a  reasonable  expectation  of  pecuniary  advantage  is  always  a  mixed question of fact and law. There are several  decided  cases  on  this  point,  providing  the  guidelines  for  determination  of  compensation  in  such cases but we do not think it necessary for us  to  advert,  as  the  claimants  had  not  adduced any  materials  on  the  reasonable  expectation  of  pecuniary benefits, which the parents expected. In  

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case of a bright and healthy boy, his performances  in the school, it would be easier for the authority to  arrive at the compensation amount, which may be  different  from  another  sickly,  unhealthy,  rickety  child  and  bad  student,  but  as  has  been  stated  earlier, not an iota of material was produced before  Shri Justice Chandrachud to enable him to arrive at  a just compensation in such cases and, therefore,  he has determined the same on an approximation.  Mr.  Nariman,  appearing  for  TISCO on his  own,  submitted  that  the  compensation  determined  for  the children of all age groups could be doubled, as  in his view also, the determination made is grossly  inadequate.  Loss  of  a  child  to  the  parents  is  irrecoupable,  and  no  amount  of  money  could  compensate  the  parents.  Having  regard  to  the  environment  from  which  these  children  were  brought, their parents being reasonably well-placed  officials of Tata Iron and Steel Company, and on  considering  the  submission  of  Mr.  Nariman,  we  would direct that the compensation amount for the  children between the age group of 5 to 10 years  should be three times. In other words, it should be  Rs.1.5 lakhs, to which the conventional figure of  Rs.50,000  should  be  added  and  thus  the  total  amount in each case would be Rs.2.00 lakhs. So  far as the children between the age group of 10 to  15 years, they are all students of Class VI to Class  X  and  are  children  of  employees  of  TISCO.  TISCO itself has a tradition that every employee  can  get  one  of  his  children  employed  in  the  Company.  Having  regard  to  these  facts,  in  their  case,  the  contribution  of  Rs.12,000  per  annum  appears to us to be on the lower side and in our  considered  opinion,  the  contribution  should  be  Rs.24,000  and  instead  of  11  multiplier,  the  appropriate multiplier would be 15. Therefore, the  compensation, so calculated on the aforesaid basis  should be worked out to Rs.3.60 lakhs, to which an  additional sum of Rs.50,000 has to be added, thus  making the total amount payable at Rs.4.10 lakhs  for each of the claimants of the aforesaid deceased  

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children.”

Even by that standard,  the amount of compensation granted by the  

High  Court  appears  to  be  adequate  in  absence  of  any  evidence  having  

brought on record as to the actual damages.

10. The appeal is dismissed.  In the facts and circumstances of the case,  

however, there shall be no order as to costs.

……………………………….J. [S.B. Sinha]

..…………………………..…J.  [Cyriac Joseph]

New Delhi; July 29, 2009

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