Ramrao Lala Borse vs New India Assurance Company Ltd.

REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO 418 OF 2018 [Arising out of SLP(C) No.7375 of 2017]

RAMRAO LALA BORSE AND ANR ..Appellants

VERSUS

NEW INDIA ASSURANCE COMPANY LTD. AND ANR ..Respondents

JUDGMENT

Dr D Y CHANDRACHUD, J

1 The present appeal arises from a judgment and order of a Division

Bench of the High Court of Judicature at Bombay dated 23 October 2015.

The High Court has partly allowed the appeal of the insurer and reduced the

award of compensation by the Motor Accident Claims Tribunal from Rs

61,55,000/- to Rs 26,45,000/-.

2 The claim before the Tribunal arose thus:

On 19 February 2006, Deepak was travelling as a passenger in a luxury bus

on Mumbai-Agra road and was occupying a seat on the driver’s side. When Signature Not Verified Digitally signed by SATISH KUMAR YADAV

the bus was at Atgaon in Nashik district, a truck bearing Registration Date: 2018.01.19 17:08:57 TLT Reason:

No.RJ-01-G-6386 came from the opposite direction and collided with the bus 2

resulting in grievous injuries to the passengers including Deepak. Deepak

was shifted to the Government hospital at Nashik where he succumbed to his

injuries.

3 At the time of the accident, the deceased was serving as an Assistant

Teacher in Dadasaheb Dandekar Vidyalaya, a school run by Shishu Vihar

Education Society. The claimants, who were his parents, filed a claim under

Section 166 of the Motor Vehicles Act 1988 seeking compensation against the

owner of the offending truck and the insurer. The Tribunal held that the

accident was caused due to the rash and negligent act of the driver of the

offending truck. The Tribunal accepted the evidence adduced by the

Claimants that had the deceased survived, he would have been made

permanent and would have been entitled to the benefit of 6 th Pay Commission

wages of at least Rs 40,000 per month. Adopting a multiplier of 17, the

Tribunal awarded compensation of Rs 61,20,000/- to which it added a further

sum of Rs 35,000/- under conventional heads. Interest was awarded @9%

p.a.

4 The High Court, on an analysis of the evidence, confirmed the finding of

negligence arrived at by the Tribunal. On compensation, the High Court noted

that the salary certificate (Exh.42) dated 18 March 2013 indicated that the

deceased was working as an Assistant Teacher on a temporary basis in the

secondary section of Shishu Vihar Education Society between June 2001 and 3

February 2006. The income certificate indicated that in February 2006 the

deceased was in receipt of a salary of Rs 2,800 per month. Another

certificate issued by the Headmaster on 20 March 2006 (Exh.47) indicated the

same position.

5 The case of the claimants rested on the premise that the deceased was

likely to be made permanent in which event, he would be entitled to a higher

salary. PW 3, who was the Secretary of the Trust, deposed that though the

strength of the students had increased, and the workload had increased,

persons such as the deceased continued in service on a contract basis for

want of sanction from the government for the post. The High Court observed

that the evidence of PW 3 was that if the government were to sanction the

post, considering the seniority and experience of the deceased, the Trust

would have appointed him as a permanent teacher in which event his salary,

according to the scales of the 6th Pay Commission, would have been Rs

40,000 per month. The finding was that the deceased at the relevant time was

29 years of age; that he had completed his B.Ed. from the University of

Mumbai and was an Assistant Teacher employed on a temporary/contract

basis for teaching English from 2001 to 2006. The High Court adverted to the

provisions contained in the Maharashtra Employees of Private Schools

(Conditions of Service) Regulation Act, 1977. In this background, the High

Court arrived at the finding that if the deceased were to be alive, he would

have been regularized and would have drawn a salary of Rs 40,000/- per 4

month. The High Court held that an addition of 50 per cent on account of

future prospects ought to have been made. However, the High Court held

that the Tribunal erred in applying a multiplier of 17. Having regard to the fact

that the father of the deceased was 65 years old in 2006 and his mother was

50 years old, the High Court came to the conclusion that a multiplier of 7

should be adopted, taking the average age of the parents as 61 years. The

High Court held that since the deceased was a bachelor, a deduction of 50

per cent should be made on account of personal expenses. On the above

basis, the High Court computed the yearly income of the deceased at Rs

4,80,000; enhanced the income by 50% on the ground of future prospects to

Rs 7,20,000, deducted a sum of Rs 3,60,000 towards personal expenses and

on the basis of a multiplier of 7 arrived at a total compensation of

Rs 25,20,000. The amount payable to each of the two claimants for loss of

love and affection was enhanced to Rs 50,000 and funeral expenses of Rs

25,000 were allowed. The High Court has, accordingly, awarded a total

compensation of Rs 26,45,000 together with interest @ 9% p.a.

6 The principal ground which has been urged in support of the appeal is

that the High Court erred in applying a multiplier of 7. Since the age of the

deceased at the time of the accident was 29 years, it was urged that the

correct multiplier to be applied would be 17.

5

7 The insurer had challenged the judgment of the High Court before this

Court in Special Leave Petition (C ) No 7717 of 2016. The Special Leave

Petition was dismissed on 25 April 2016. The challenge of the insurer to the

judgment of High Court has hence failed. Consequently, for the purpose of

the present appeal, we will have to proceed on the basis of the income as

accepted by the High Court. The finding of fact in regard to the income of the

deceased would not be challenged in the present appeal, at the behest of the

insurer in view of the above background.

8 In terms of the judgment of the Constitution Bench of this Court in

National Insurance Company Limited v Pranay Sethi1 and the judgment in

Sarla Verma v Delhi Transport Corporation2, the correct multiplier to be

applied in the present case would be 17 having regard to the age of the

deceased. As regards future prospects, an addition of 50 per cent would be

warranted. On the above basis and making a deduction of 50 per cent

towards personal expenses (the deceased being a bachelor), the total

compensation would stand quantified at Rs 61,20,000/-. After making an

addition on account of conventional heads, the total compensation would

stand computed at Rs 61,90,000/-. The aforesaid amount shall carry interest

@ 9% p.a. from the date of the filing of the claim petition. Apportionment shall

be carried out in terms of the award of the Tribunal.

1 (2017) 13 SCALE 12 2 (2009) 6 SCC 121 6

9 The appeal shall accordingly stand allowed. There shall be no order as

to costs.

...........................................CJI [DIPAK MISRA]

...........................................J [A M KHANWILKAR]

...........................................J [Dr D Y CHANDRACHUD]

New Delhi;

January 19, 2018