Polavarapu Somaraiyam And Others v. Andhra Pradesh Road Transport Corporation, Hyderabad .

Ramaswamy, J.:— This Civil Miscellaneous Appeal arises against the order of the Motor Vehicles Accidents Claims Tribunal (District Judge) at Guntur dated 28-9-1976 in O.P No. 91 of 1974. Here is an instance where due to callous indifference to duty and disregard to value of human life, long span of precious life of a cyclist, aged about 30 years was brought to an abrupt end on 27-9-1973 by rash and negligent driving of a motor vehicle by R.W 1. The applicants are claimants. They laid their claims under S. 110-B. Motor Vehicles Act (Act 4 of 1939), hereinafter referred to as “the Act”, for a just compensation in a sum of Rs. 38,400 for loss of their dependency due to the death caused to one Sri P. Prakasam, resident of Yadlapalli village, Tenali Taluk. Guntur District. The first appellant the widow aged about 24 years, 2nd appellant, daughter aged about 12 years, 3rd, 4th and 5th appellants, sons aged about 10, 8 and 4 years respectively and 6th appellant the father aged about 60 years, are his legal representatives.

2. The case of the appellant is that on 27-11-1973, while Sri P. Prakasam was going on a cycle on Guntur-Tenali road, when he was near Angalakuduru and was proceeding on the left side of the road, at about 7 p.m, the bus APZ 5040 belonging to the respondent-Andhra Pradesh State Road Transport Corporation, hereinafter called for brevity ‘the Corporation’ came at a high speed without blowing horn and hit the deceased from behind and ran over him. As a result, the deceased sustained fatal injuries on the right thigh and pelvic region. When he was taken to the Government Hospital. Tenali, he died in the hospital. In the course of the same transaction, the cycle on which the deceased was riding was badly damaged. On account of the rash and negligent driving of the driver of the said vehicle, the deceased met with premature death, though he is aged about 30 years with robust health. According to the appellants, he was earning a sum of Rs. 200 per month at the time of the death. Therefore, they got issued a notice Ex. A-1 dated 27-5-1974 to the Corporation calling upon them to pay compensation in a sum of Rs. 40,400. Since the Corporation did not make payment thereof, they were driven to lay the claim.

3. The appellants laid their claim as follows:—

“1. Pecuniary loss sustained as legal representatives-cum-dependants of the deceased: Rs. 1st appellant (widow) aged 24 years 11,500-00 2nd appellant (daughter) 12 years 3,500-00 3rd appellant (son) 10 years 3,500-00 4th appellant (son) 8 years 3,500-00 5th appellant (son) 4 years 4,000-00 6th appellant (father) 60 years 2,000-00 2. Loss of consortium to the 1st appellant 5,000-00 3. Loss to the estate viz. loss of expectation of life of deceased and mental pain and suffering to appellants 5,000-00 4. Cost, of damages of cycle 400-00 Total Rs. 38,400-00”

4. The respondent filed its counter denying the allegations made by the appellants. It is alleged that the driver slowed down the speed on seeing the cyclist and he blew horn and on finding enough clearance, the driver drove the vehicle cautiously. But the deceased unexpectedly jumped from the cycle falling down on the left side burm portion of the road as he lost his balance. As a result, the cycle came underneath the bus. In spite of applying the brakes and stooping the vehicle, the cyclist was dragged on the hard surface of the road. The contention thus set up is that the death of the deceased is not as a result of the rash and negligent driving of the driver. It is further contended that the deceased has no avocation or trade in life. The 6th appellant is not the legal heir and he did not suffer any loss. The claim is exaggerated. Therefore the petition has to be dismissed.

5. It is not now in dispute that the police laid a charge-sheet against the driver. Sri B. Sivaramakrishna examined in this case as R.W 1 under S. 304-A of I.P.C and that he was convicted for rash and negligent driving and sentenced to undergo rigorous imprisonment for a period of five months, but on appeal, the conviction was affirmed but the sentence was reduced to two months. This admission, on the part of R.W 1, the driver, establishes that the finding of the Criminal Court that the accident occurred due to the rash and negligent driving of R.W 1 and the deceased died in accident has become final.

6. The lower Tribunal framed appropriate issues. The parties adduced evidence. On consideration thereof, the Tribunal has given findings that:— (a) the accident occurred as a result of the rash and negligent driving of R.W 1. the driver and Sri Prakasam died as a result thereof: (b) the deceased Prakasam was “hale and healthy” and that he was aged about 30 years and that he would have lived for another 30 years in the normal course of life: (c) He left behind the first appellant, his widow aged about 24 years, the children— the daughter aged about 12 years and sons aged about 10, 8 and 4 years respectively and the father aged about 60 years: and (d) that they are his legal representatives.

7. It is the case of the first appellant in her petition that the deceased was working as a coolie and he was also selling curd and his daily earning is at Rs. 6 per day. The deceased alone was the bread-winner of their family. On account of the death of the deceased, the appellants are permanently deprived of their maintenance and support. The appellants suffered mental pain and anguish and that the first appellant lost consortium and on all the said grounds, the appellants claimed that they will be entitled to a sum of Rs. 38,000 as Stated above and the value of the cycle at Rs. 400.

8. To substantiate the claim thus laid, the first appellant examined herself as P.W 1. She stated in chief-examination that the deceased was working as a coolie and that he was also vending curd. His net income was Rs. 7 per day. In her cross-examination, she has reiterated that he was working in the field of one P. Venkataramiah resident of Yadlapalli and that the said Venkataramiah was paying Rs. 5 per day whenever the deceased attends the work. From vending curd his net income is Rs. 7 per day. Nothing material has been elicited in the cross-examination to discredit her testimony. It was suggested to her that the earning of the deceased was not more than Rs. 2 or Rs. 3 per day. Except this suggestion nothing has been brought on record either to disbelieve the evidence of P.W 1 or what she stated has no factual basis. The facts that the deceased is the sole bread-winner and that the appellants are entirely depending on the earnings of the deceased and that they are the legal representatives and the 6th appellant also is being maintained by the deceased are not disputed in the cross-examination.

9. The lower tribunal found that the deceased is a daily wage earner either by selling curd or by doing coolie work, that P.W 1 also must be doing some coolie work and that from the earnings of the deceased and P.W 1 the family and children are being maintained. The daily wages of the deceased would be Rs. 2 or Rs. 3. Since life span of the deceased would be 60 years, he would have earned for another 20 years and at the rate of Rs. 2 or Rs. 3 his income would be assessed at Rs. 720 or Rs. 1,000. Out of the said amount 1/3rd has to be deducted owards his own expenditure. The balance amount would be the loss suffered by the appellants. The deceased would have worked and earned for the family for about 15 to 20 years had he not died in the accident. On these findings, the lower Tribunal held that the appellants would be entitled to Rs. 6,000 as damages. The first appellant is entitled to Rs. 1,000 towards loss of consortium. The appellants are entitled to Rs. 1,000 towards mental pain and suffering. The lower Tribunal awarded Rs. 200 towards damages caused to the cycle. Thus, in all a sum of Rs. 8,200 has been awarded and also directed to pay interest at the rate of 6% per annum from the date of award till date of realisation. The petition was accordingly ordered with costs. Dissatisfied with the meagre amount awarded by the lower Tribunal, the appellants have filed the above appeal.

10. It is contended by the learned counsel for the appellants that the evidence of the first appellant as P.W 1 has not been seriously challenged by the respondent: that her evidence that the deceased was earning a net income of Rs. 7 towards vending curd and that whenever there is work, he has also been working as coolie and that at that time he was being paid Rs. 5 per day by the said Venkataramaiah has not been shaken in any way in the cross-examination. The respondent did not adduce any independent evidence to rebut the above evidence. Only a desperate suggestion has been made to P.W 1 to diminute the compensation that may be paid to the appellants by putting a bare suggestion that the deceased would be earning not more than Rs. 2 or Rs. 3 per day. It has no legal basis. This is nothing but a guess suggestion made in desperation. In the face of the uncontroverted evidence of P.W 1 the lower Tribunal is not iustified in limiting the earnings of the deceased at Rs. 2 or Rs. 3 per day, merely basing on the suggestion made to P.W 1.

In view of these undisputed facts no justifiable reasons were assigned to limit the earnings to Rs. 2 or Rs. 3 a day and the lower Tribunal ought to have fixed the daily earning at least at Rs. 6 as stated by her in her petition. The lower Tribunal is also not justified in holding that P.W 1 was also working and earning in the absence of any evidence to that effect or at least, the suggestion, P.W 1 was not cross-examined on that aspect, it is further contended that the lower Tribunal was not iustified in awarding only Rs. 1,000 on each of the two counts, i.e loss of consortium and mental pain and suffering. It is also further contended that the lower Tribunal has seriously erred in taking 1/3rd towards expenses of the deceased. In the case of the appellants, the deduction of one-third is arbitrary. Interest would have been given from the date of the petition, but not the award.

11. Sri Ananda Rao the learned senior standing counsel for the Corporation has strenuously contended that the lower Tribunal is justified in fixing the daily earning of the deceased at Rs. 2 or Rs. 3 and taking that amount as basis and after giving necessary deductions, the Tribunal awarded just damages and the order is not in any way vitiated by any error of law. It does not warrant any interference by this Court. It was also further contended that the Tribunals, in matters of awarding compensation have been adopting varied approach in fixation of quantum of compensation. As a result they are not in a position to take decision to order payment of compensation to the legal representatives of the deceased though prior notices are being given. The principles to be applied are only as per the provisions of Fatal Accidents Act. The provisions of the Act merely provide forum. Fatal Accidents Act contemplates damages which the dependants had suffered. According to him two methods are available in assessing the damages. One is to calculate the actual number of years for which the deceased and the dependants were expected to live and total up the annual dependency with that number of years.

Then apply suitable multiplier principle to arrive at a figure which would represent the purchase value of the dependency for a number of years which would be much shorter than the number of years for which the deceased was expected to live. The other principle is interest theory. The lower Tribunals are adopting either of these methods. As a result, the Corporation would not be in a position to follow which is the correct method. Therefore we have to lay down the guidelines as to which is the correct method to be followed in awarding compensation to the legal representatives of the deceased victim. In support of the above contention, he placed strong reliance on the decision of the House of Lords in Cookson v. Knoles, 1979 Acc CJ 216 : (1979) AC 556 and the decision of the Supreme Court in Madhya Pradesh State Road Transport Corporation v. Sudhakar, AIR 1977 SC 1189, and also the decision in Union of India v. Asha Rani, 1980 Acc CJ 134 (Punj & Har) and contended that the interest theory be adopted while laying down the guidelines to award damages.

12. Upon the above contentions, the points that arise for our decision are:

(1) Whether there are any justifiable grounds or circumstances to interfere with the finding of the Tribunal below regarding the quantum of the income that is being earned by the deceased at the time of the accident and what would be the proximate income and what are the factors to be taken into consideration while fixing compensation?

(2) What are the principles the Claims Tribunal has to adopt while awarding compensation to the legal representatives of the deceased victim?

13. Before considering the above questions, we have to state that the following facts are undisputed. The vehicle APZ 5040 was driven by B. Sivarama Krishna (R.W 1). The accident occurred on 27-11-1973 at 7 p.m near Angalakuduru village on Guntur-Tenali road and that the vehicle hit the deceased from behind and it was due to the rash and negligent driving by R.W 1 Sri Prakasam died in the accident at the age of 30 years while in “robust health”. The appellants are dependants. They were being maintained by the deceased from his earnings as coolie and vending curd. The appellants are entitled to such sum as will make good to them the financial loss which they have suffered and will suffer as a result of the death. It is the loss of dependency. It is also not in dispute that the Corporation is vicariously liable for the tortious acts of its driver R.W 1 and that they are bound to pay damages to the appellants. The only dispute is what is the quantum of compensation to which the appellants are entitled to. Upon these undisputed facts, the only question that arises for consideration is what would be the just and reasonable compensation the appellants are entitled to.

14. The object of providing compensation is to mitigate the hardship the has been caused to the legal representatives due to the sudden demise of the deceased in the accident which has been succinctly stated by Lord Diplock in his speech in Mallet v. McMonagle (1970) AC 166 (House of Lords) thus:

“The purpose of an award of damages under the Fatal Accidents Act is to provide the widow and other dependants of the deceased with a capital sum which with prudent management will be sufficient to supply them with material benefits of the same standards and duration as would have been provided for them out of the earnings of the deceased had he not been killed by the tortious act of the defendant, credit being given for the value of any material benefits which will accrue to them (otherwise than as the fruits of insurance) as a result of his death.”

Thus the claim is for the monetary injury inflicted and the loss of dependency cause to the legal representatives or dependants of the deceased. The compensation to be awarded should not be wholly inadequate. It should also neither be unreasonably excessive burden or liability on the respondent nor unreasonably deficient. It should be commensurate to the loss of dependency suffered by the legal representatives. Therefore, it should be just and reasonable: proportionate to the injury resulting from the death of the deceased.

15. The question, therefore, that arises for consideration is: What are the relevant provisions of law and the principles laid down therein applicable to fix just and reasonable amount to compensate the loss of dependency. Section 1-A and S. 2. Fatal Accidents Act, 1855 and Ss. 110-A to 110-F, Motor Vehicles Act, (Act 4 of 1939), are the provisions available under the statutes.

16. Section 1, Fatal Accidents Act, 1855 (Act XIII of 1855) is in substance a reproduction of the English Fatal Accidents Act, 9 and 10 Ch. 93, known as the Lord Campbell's Act.

17. It was further amended by Act III of 1951. Through this amendment, S. 1-A has been introduced in this Act. This amendment is now in tune with the amendments to S. 1 of the Lord Camp-bells's Act brought about from time to time in England. Section 2 of the Act is now in time with the English Law Reforms (Miscellaneous Provisions) Act, 1934. The damages to be awarded to the dependants of the deceased are to be governed by S. 1-A, Fatal Accidents Act and the damages to be awarded to the estate of the deceased is to be governed by S. 2.

18. The Fatal Accidents Act confers the common law right to claim damages for tortious acts to statutory right to recover compensation to dependants for loss of dependency due to the death of a person caused by an actionable wrong, by way of an action in a civil Court.

19. Section 110, Motor Vehicles Act, (Act 4 of 1939), gave power to the State Government to constitute Motor Accidents Claims Tribunal by a notification for the purpose of adjudicating upon the claims for compensation in respect of accidents involving the death of, bodily injury to, persons arising out of the use of motor vehicles or damages to any property of a third party or arising from both. By Amending Act, 100 of 1956, Ss. 110-A to 110-F have been provided as a special remedy taking away the jurisdiction of the civil Court and conferring exclusive jurisdiction in the Claims Tribunal. The remedy provided is cheap, expedient and efficacious. S. 110-B empowers the Tribunal “to determine the amount of compensation which appears it to be just” but does not lay down the principles and basis for awarding compensation. Therefore it is not necessary to extract all the provisions except to the extent indicated above. It has been considered in several decisions that Ss. 110-A to 110-F are procedural in nature and the substantive provisions under which the compensation is to be determined are to be found only in Section 1-A and S. 2 of the Fatal Accidents Act. In Kamla Devi v. Kishanchand, AIR 1970 Madh Pra 168 a Division Bench of the Madhya Pradesh High Court held that:

“A Claims Tribunal inquiring into a claim for compensation under S. 110-B in respect of a fatal accident arising out of the use of a motor vehicle is bound to apply the law as contained in the Fatal Accidents Act (1855). The group of Sections 110 to 110-F lays down the procedure and powers of the Tribunal and these sections do not deal with liability at all; they only provide a new mode of enforcing the liability in respect of accidents involving death or bodily injury which before the constitution of the Tribunals was being enforced by Civil Court. The object of these sections is to provide a cheap and speedy mode of enforcing liability arising out of use of motor vehicles. The power of S. 110-B to make an award ‘determining the amount of compensation which appears to it to be just’ conferred on the Tribunal does not create any new basis or extent of liability. The Tribunal must determine the amount of compensation according to the substantive law of liability already in force. Section 110-B is in no way intended to give a go-by to the basis and limit of liability fixed by the substantive law. In case of fatal accidents, whether arising out of the use of motor vehicles or otherwise, the basis and extent of liability are determined by the substantive law contained in Ss. 1-A and 2. Fatal Accidents Act.”

The same view was approved by a Full Bench of the same Court in Mangilal v. Parasram, AIR 1971 Madh Pra 5: A Division Bench of the Orissa High Court in Oriental Fire & General Insurance Co. v. Kamal Kamini AIR 1973 Orissa 33 and a Division Bench of the Mysore High Court in Government of India v. Jeevaraj Alva. AIR 1970 Mys 13 and a Full Bench of five Judges of Puniab & Haryana High Court in Lachman Singh v. Gurmit Kaur. AIR 1979 Puni & Har 50; and a Division Bench of Delhi High Court in Dewan Hari Chand v. Delhi Municipality, AIR 1981 Delhi 71 have held the same view.

20. A Division Bench of this Court in K. Narayana Reddiar…* (1St ); v. P. Venugopala Reddiar… (Petitioner)., AIR 1976 Andh Pra 184 has held that:

“The obiect of introducing these provisions (Ss. 110 to 110-B) was to provide a speedy remedy for the adjudication of claims relating to accidents involving motor vehicles. We do not think that the legislature intended that a different law of tort should be applicable to persons injured in motor vehicles accidents from those injured in other accidents. We do not hink that it was intended by the use of the expression ‘compensation’ that the persons injured should be entitled to more than damages which they would be entitled under the law of tort. The expression ‘just’ in our view does not have any added significance as compensation would by itself mean a proper recompense for the injuries. Even without the word ‘just’ there can be no doubt that the compensation awarded must be what is considered ‘just’ by the Court in the circumstances of the case.”

On a consideration of the principles laid down in the above cases, we are inclined to agree with the learned senior standing counsel for the Corporation. Mr. C. Anandarao the Ss. 110 to 110-E of the Motor Vehicles Act provide cheap, efficacious and expeditious remedy and also a complete code with regard to the forum to entertain, to adjudicate the claims, to give award of just compensation and to execute the same. The substantive law applicable to the claims arising out of the accidents while using the motor vehicles in which the death has occurred, etc. would be the Fatal Accidents Act as well as power given under S. 110-B, viz. to “determine the amount of compensation which appears to it to be just”. Both would operate in the same field within the principles laid down under Ss. 1-A and 2 of the Fatal Accidents Act. Both the provisions have to be construed harmoniously; or else, by process of interpretation we would be rendering he substantive power to determine just compensation given under S. 110-B surplusage. No doubt, no guidelines or principles were laid down therein. By that omission it cannot be said that the above power is not substantive. It would appear that the Legislature thought that they would be unnecessary because they are already laid down in Ss. 1-A and 2 of the Fatal Accidents Act since the Fatal Accidents Act, is genus embracing varied tortious acts of which the claims under the Act are some species. In Crawford's Statutory Construction, at page 260 the principle of harmonious construction was stated as under:

“Hence, the Court should when it seeks the legislative intent, construe all the constituent parts of the statute together and seek to ascertain the legislative intention from the whole Act, considering every provision thereof in the light of the general purpose and object of the Act itself, and endeavouring to make every part effective, harmonious and sensible. This means, of course, that the Court should attempt to avoid absurd consequences in any part of the statute and refuse to regard any word, phrase, clause or sentence superfluous, unless such a result is clearly unavoidable.”

The above principle equally proprio vigore applies here. Following the above principle, in this case, we are inclined to hold that both the substantive provisions intended to supplement each other. Any other construction would render the latter surplusage. It was never the intendment of the legislature to that end. The endeavour of the Court should be to construe the parallel provisions harmoniously to allow both the Acts to have their full play and operation.

21. The next question is what is the meaning of the word ‘compensation’ in the context of the claims in question. Is it restrictive as contended by Sri Ananda Rao or wider in its scope and amplitude? At one point of time, a distinction was being drawn between the scope and ambit of the words ‘damage’ and ‘compensation’. The word ‘compensation’ was interpreted to be wider in its content than the word ‘damage’. While construing the word ‘compensation’ their Lordships of the Supreme Court in State of Gujarat v. Shantilal, AIR 1969 SC 634 at p. 644 held that:

“The word ‘compensation’ means anything given to make things equivalen, a thing given to or to make amends for loss, recompense, remuneration or pay.”

22. In Corpus Juris Secundum. Volume No. 15, at pages 652 and 653, the meaning of the word ‘compensation’ with reference to injuries or loss has been defined thus:

“In the sense of an act, the word has been defined as meaning an act which a court orders to be done, or money which a court orders to be paid, by a person whose acts or omissions have caused loss or injury to another, in order that thereby the person damnified may receive equal value for his loss, or be made whole in respect of his injury; the giving back an equivalent in either money, which is but the measure of value, or in actual value otherwise conferred: in damnification, making amends, payment of damages, or the rendering an equivalent in value of amount………a recompense or reward for some loss, injury, or service, especially when it is given by statute: that return which is given for something else. More specifically with reference to injury or loss, ‘compensation’ has been defined as meaning amends: an equivalent given to property taken or for an injury done to another or an equivalent, in money for a loss sustained.”

23. In M. Ayypapan v. Moktar Singh, 1969 Acc CJ 439 : (AIR 1970 Mys 67) a Division Bench of the Mysore High Court held that (at P. 68):—

“Thus, it is clear that the word ‘compensation’ is a more comprehensive term and the claim for compensation includes a claim for damages and hence, the petitioners could have put forward their suit claim before he Motor Accidents Claims Tribunal.”

That apart we can also state that the legislature is presumed to be aware of the existence of the provisions of the Fatal Accidents Act when it enacted and brought on the statute the provisions of Ss. 110-A to 110-F by amending Act 100 of 1956 and used the word ‘compensation’ instead of ‘damages’ as commonly known under the Fatal Accidents Act. Therefore, the legislature is presumed to have intended that in case of fatal accidents arising out of use of motor vehicles when the word “compensation’ has been used and empowered the Claims Tribunals to determine just compensation’ instead of ‘damages’ in a more ‘wider sense’ than the restricted meaning Riven to the word ‘damages’ to decide just compensation to recompensate the legal representatives/dependants, in equivalent money value for the injury caused.

24. It is an accepted principle of the Permanent Court of International Justice that a wrong done to a person should normally be remedied by a restitution in kind. Only when this is impossible or when the aggrieved party elects to be awarded damages, there can be a judicial order for the payment of compensation. Normally in this class of cases with which we are dealing restitutio in integrum is impossible. The question, herefore, arises as to how the quantum of damages should be calculated. It is a settled principle that the quantum of damages should be calculated so as to put the claimant in an identical financial position. In otter words, the quantum of damages should be calculated in such a way that the death of the victim of a motor vehicle accident should not have made any difference to the living dependants. (See O'Connell's International Law. Vol. Two page 1335). The principles laid down under the Fatal Accidents Act lend assurance to this conclusion when it declares that it intended to provide compensation to families for loss occasioned by the death of a person caused by actionable wrong.

25. It is, therefore, profitable to extract the provisions of S. 1-A etc. thus:

Section 1-A. Fatal Accidents Act, 1885 (Act 13 of 1885), reads thus:

“1-A. Suit for compensation to the family of a person for loss occasioned to it by his death by actionable wrong:— Whenever the death of a person shall be caused by wrongful act, neglect or default, and the act, neglect or default, is such as would (if death had not ensued) have entitled the party injured to maintain an action and recover damages in respect, thereof, the party who would have been liable if death had not ensued shall be liable to an action or suit for damages, notwithstanding the death of the person injured, and although the death shall have been caused under such circumstances as amount in law to felony ox other crime. Every such action or suit shall be for the benefit of the wife, husband, parent and child, if any, of the person whose death shall have been so caused, and shall be brought by and in the name of the executor, administrator or representative of the person deceased; and in every such action the Court may give such damages as it may think proportioned to the loss resulting from such death to the parties respectively, for whom and for whose benefit such action, shall be brought and the amount so recovered, after deducting all costs and expenses, including the costs not recovered from the defendant shall be divided amongst the beforementioned parties, or any of them, in such shares as the Court by its judgment or decree shall direct.”

Section 2 reads thus:

“Not more than one suit to be brought; Provided that not more than one action or suit shall be brought for, and in respect of the subject-matter of complaint.”

26. In Section 4, interpretation clause, it has been specified, ‘parent’ shall include father and mother and ‘child’ shall include son and daughter, etc.

27. House of Lords considered the scope of S. 1 of the Lord Campbell's Act and laid down the principle in Davies v. Powell Dufryn Associated Collieries Ltd., (1942) AC 601, Lord Wright, in his speech, observed:

“There is no question here to what may be called sentimental damages, bereavement or pain and suffering. It is a hard matter of pounds, shillings and pence, subject to the element, of reasonable future probabilities. The starting point is the amount of wages which the deceased was earning, the ascertainment of which to some extent, may depend on the regularity of his employment. Then there is an estimate of how much was required or expended for his own personal and living expenses. The balance will give a datum or basic figure which will generally be turned into a lump sum by taking a certain number of years purchase. That sum, however, has to be taxed down by having due regard to uncertainties, for instance, that the widow might have again married and thus ceased to be dependant, and other like matters of speculation and doubt……

Damages are to be assessed on the balance of profit and loss and to be proportioned to the injury resulting from the death to the individual. The injury suffered by the individual from the death cannot be computed without reference to the benefit also accruing from the death of the same individual from whatever source.”

Lord Russel of Killowen observed in his speech:

“The general rule which has always prevailed in regard to the assessment of damages under the Fatal Accidents Act is well settled, namely, that any benefit accruing to a dependant, by reason of the relevant death must be taken into account. Under those Acts the balance of loss and gain to a dependant by the death must be ascertained, the position of each dependant being considered separately.”

28. The estimate of the actual extent of pecuniary loss of dependency may depend on the date which cannot be ascertained with certainty and must be a matter of estimate or even purely of conjecture. This principle has been lucidly reiterated by Lord Viscount Simon explaining as to how the loss of dependency has to be determined in Nance v. British Columbia Electric Railway Co. Ltd., (1951) AC 601 as follows;

“…… that the claim to damages in cases of death fell under two separate heads: first what sums the deceased would have probably applied out of his income to the maintenance of his wife and family if the deceased had not been killed and would have lived the full span of life: second what would have been the additional savings which the deceased would or might have lived but for the premature death, which would probably have accrued to his wife and family.”

For the purpose of arriving at the correct assessment under these two heads, Lord Viscount Simon laid down the following principles:

“Under the first head, indeed, for the purposes of both heads, it is necessary first, to estimate what was the deceased man's expectation of life if he had not been killed when he was: (let this be ‘X’ years) and next what sums during these X years he would probably have applied to the support of his wife. In fixing X. regard must be had not only to his age and bodily health, but the possibility of premature determination of his life by a later accident. In estimating future provisions for his wife, the amounts he usually applied in this way before his death are obviously relevant and often the bast evidence available though not conclusive, since if he had survived, his means might have expended or shrunk, and his liberality might have grown or wilted.”

Lord Viscount continued further and observed:

“It would be seen from the said mode of estimation that many imponderables enter into the calculation. Therefore the actual extent of the pecuniary loss to the respondents may depend upon data which cannot be ascertained accurately, but must necessarily be an estimate, or even partly a conjecture. Shortly stated, the general principle is that the pecuniary loss can be ascertained only by balancing on the one hand the loss to the claimants of the future pecuniary benefit and on the other any pecuniary advantage which from whatever source comes to them by reason of the death, that is the balance of loss and gain to a dependent by the death must be ascerained.”

Lord Wright, in the same decision at page 617, has stated:

“The starting point is the amount of wages which the deceased was earning, the ascertainment of which to some extent may depend upon regularity of his employment. Then there is an estimate of how much was required or expended for his own personal and living expenses. The balance will give a datum or basic figure which will generally be turned into a lump sum by taking a certain number of years' purchase.”

29. This question has come up for the first time before their Lordships of the Supreme Court in Gobald Motor Services Ltd. v. Veluswami AIR 1962 SC 1. Their Lordships applied the above principle to the case arising under the motor accidents and the loss of life of the individual in the said accident. The unamended S. 1 of 1885 Act was considered therein vis a vis the claim for compensation for loss of dependency due to death in the motor accident. One Rajaratnam aged 34 years died in the accident. His widow, father and five sons laid claim for compensation. The annual dependency was determined at Rs. 25,000. This was assailed by the Insurance Company. Their Lordships followed the principles laid down by the House of Lords in the above two decisions. His Lordship Justice Subba Rao (as his Lordship then was) speaking for the Bench further clarified the position by giving an illustration, at para 11, as follows:

“An illustration may clarify the position X is the income of the estate of the deceased Y is the yearly expenditure incurred by him on his dependants (we will ignore the other expenditure incurred by him). X-Y i.e, Z., is the amount he saves every year. The capitalised value of the income spent on the dependants, subject to relevant deductions, is the pecuniary loss sustained by the members of his family through his death. The capitalised value of his income, subject to relevant deductions, would be the loss caused to the estate by his death.”

30. This decision was followed in Municipal Corporation of Delhi v. Subhagavanti, AIR 1966 SC 1750 a case of ordinary tortious act. While following the above principle, their Lordships of the Supreme Court have held (at p. 1754):

“In the present case, there is evidence that Ram Prakash deceased was 30 years old at the time of the accident, his widow Subhagwanti being aged 28 and his son 14 and daughters 12 and 2 years old. The evidence adduced regarding the income of Ram Prakash and the amount of loss caused to his widow and children was not satisfactory but the High Court considered that the widow and children must have been receiving at least a monthly sum of Rs. 150 for their subsistence and for the education of the children from the deceased Ram Prakash. The income was capitalised for a period of 15 years and the amount of Rs. 27,000 which was arrived at was more than the trial Court had awarded. In our opinion, the High Court has applied the correct principle in estimation of the damages in all the three appeals and the learned counsel has been unable to show that the judgment of the High Court on this aspect of the case is vitiated for any reason.”

The same principle was reiterated in C.K.S Iyer v. T.K Nair, AIR 1970 SC 376 at P. 380. In this case. S. 1-A of the present amended Act came up for consideration. Therein a boy was killed in the accident and the father laid the claim. The entire case law has been considered once over. While reiterating the law laid down earlier, their Lordships of the Supreme Court have specifically laid down that—

“There can be no exact uniform Rule for measuring the value of human life and the measure of damages cannot be arrived at by precise mathematical calculations but the amount recoverable depends on the particular facts and circumstances of each case. The life expectancy of the deceased or of the beneficiaries whichever is shorter is an important factor. Since the elements which go to make up the value of the life of the deceased to the designated beneficiaries are necessarily personal to each case, in the very nature or things, there can be no exact or uniform rule for measuring the value of human life. In assessing damages, the Court must exclude all considerations of matter which rest in speculation or fancy though conjecture to some extent is inevitable.”

31. In Sheikhupura Transport Co. Ltd. v. Northern India Transport Insurance Co.† , AIR 1971 SC 1624 again a case under S. 110-B. Motor Vehicles Act, his Lordship Sri Justice Hegde speaking for the Bench, has reiterated the same principles. In that case, one of the deceased, Narender Nath was spending a sum of Rs. 200 per month on his family. The High Court computed the total compensation of Rs. 36,000 on the basis of 15 years' purchase value of the benefits that were accruing to the family. Then it was contended on behalf of the appellants before their Lordships that the computation of the compensation was excessive and the High Court erred in not giving the due deductions for circumstances like the widow remarrying the possibility of the deceased persons dying before they reached the age of 58 years and the children of the deceased persons getting other source of income after they completed their education. While repelling that contention and following the rule laid down in Gobald Motor Service v. Veluswami AIR 1962 SC 1 (supra) and reiterating the same, his Lordship held at para 7:

“The determination of the question of compensation depends on several imponderables. In the assessment of those imponderables, there is likely to be a margin of error. If the assessment made by the High Court cannot be considered to be unreasonable and we do not think it to be unreasonable it will not be proper for this Court to interfere with the same. Taking an overall assessment of the facts and circumstances, of this case, we are unable to agree with the contention of the appellant's counsel that the compensation awarded to the legal representatives of the deceased person is excessive.”

In Maniushri v. B.L Gupta, AIR 1977 SC 1158 where the deceased was aged 39 years, died in the accident and that he was in service and on the date of his death his scale of pay was Rs. 590-50-35-800 and he was getting a salary of Rs. 620 per month. The deceased would have reached the maximum grade of Rs. 900 at the age of 46 years, i.e nine years before the age of superannuation. The claimant had also produced evidence to establish that after retirement he would have received pensionary benefits for another ten years. Though the High Court and the Tribunal did not take into account the maximum salary to which the deceased would have reached and the pensionary benefits the deceased would have had these two circumstances were considered by their Lordships of the Supreme Court and enhanced the compensation to Rs. 1,88,000 and half of it was deducted towards day to day domestic expenses, etc. Rs. 94,000 was ultimately held to be the loss to the dependants.

Their Lordships held (at p. 1162):—

“This will be a fair estimate which does not take into account the economic value of the deprivation to the wife of her husband's company forever and the shock felt by the children. It wad suggested by the High Court that as the deceased Raha was not a permanent employee, the amount taken into account by the Compensation Tribunal was correct. This is however, not a consideration which could have weighed with the Claims Tribunal in making the assessment because it was purely contingent. On the other hand, with the rise in price index it could well have been expected there would be several revisions in the grade by the time the deceased Raha had attained the age of superannuation, which, if taken into account would further enhance the amount. In these circumstances, therefore, we think that the amount of Rs. 90,000 would represent the correct compensation so far as the salary part of the deceased Raha is concerned.” Their Lordships have considered the pensionary benefits after retirement and further held:

“It is, therefore, reasonable to expect that if the deceased had not died due to accident, he would have lived up at least up to the age of 65 years if not more so as to earn the pensionary benefits for 10 years after retirement.

32. Then the pensionary and gratuity benefits were computed at Rs. 13,500 and totalled up to Rs. 1,03,500 and rounded off to Rs. 1,00,000. Ultimately, their Lordships held:

“In any view of the matter, therefore, the appellant Raha was entitled to a compensation of Rs. 1,00,000 and the Courts below erred in completely overlooking these two important aspects which we have discussed.”

33. In Mallet v. McMonagle, (1970) AC 166 (HL) Lord Diplock stated the method to assess damages thus:

“It is necessary to form a view upon three matters each of which is in greater or less degree one of speculation: (1) the value of the material benefits of his dependants which the deceased would have provided out of his earnings for each year in the future during which he would have provided them, had he not been killed: (2) the value of any material benefits which the dependants will be able to obtain in each such year from sources (other than insurance) which would not have been available to them had the deceased lived but which will become available to them as a result of his death; (3) the amount of the capital sum which with prudent management will produce annual amounts equal to the difference between (1) and (2) that is the ‘dependency’ for each of the years during which the deceased would have provided material benefits for the dependants, had he not been killed.”

34. While quantifying the total loss of dependency, the Courts in England and in India have evolved another ‘principle of multiplier to arrive at just compensation payable to the dependants or the legal representatives. Their Lordships of the Supreme Court, for the first time laid down this principle of multiplier in Municipal Corporation Of Delhi v. Subhagwanti & Others, AIR 1966 SC 1750. In that case the deceased Ram Prakash was aged about 30 years old at the time of the accident and his widow was aged 28 years, son 14 years and daughters 12 and 2 years respectively. His monthly dependency was determined at Rs. 150 for the subsistence and for the education of the children from the deceased. The annual dependency was computed by applying multiplier for 15 years and arrived at Rs. 27,000 as the total loss of dependency. Similarly, compensation was determined in respect of the other appellants also. Their Lordships upheld the same by holding that—

“The High Court has applied correct principle in estimation of damages in all the three appeals.”

35. In Sheikhupura Transport Co. Ltd. v. Northern India Transport Insurance Co.† , AIR 1971 SC 1624 (supra), their Lordships of the Supreme Court, applied 15 years multiplier. This principle was reiterated in the latest decision in M.P State Road Transport Corporation v. Sudhakar, AIR 1977 SC 1189 and their Lordships applied 20 years multiplier. In this regard, their Lordships have laid down as follows (at P. 1191):—

“A method of assessing damages usually followed in England, as appears from Mallet v. McMonagle (1970 AC 166) is to calculate the net pecuniary loss upon an annual basis and to arrive at the total award by multiplying the figure assessed as the amount of the “annual dependency” by a number of “years' purchase” (p. 178) that is the number of years the benefit was expected to last, taking into consideration the imponderable factors in fixing either the multiplier or the multiplicand. The husband may not be dependant on the wife's income, the basis of assessing the damages payable to the husband for the death of his wife would be similar. Here, the lady had 35 years of service before her when she died. We have found that the claimant's loss reasonably works out to Rs. 50 a month i.e Rs. 600 a year. Keeping in mind all the relevant facts and contingencies and taking 20 as the suitable multiplier, the figure comes to Rs. 12,000. The Tribunal's award cannot therefore be challenged as too low though it was not based on proper grounds. In a decision of the Kerala High Court relied on by the appellant (P.B Kader v. Thatchamma, AIR 1970 Ker 241) to which one of us was a party, the same method of assessing compensation was adopted.”

36. In The Union Of India v. Sugrabai Abdul Majid*, 1968 Acc CJ 252 : (AIR 1969 Bom 13) a Division Bench of the Bombay High Court considered the case where there are seven dependants (widow and minor children) and the earning of the deceased was determined at Rs. 150. Out of that Rs. 125 was found to be spent towards maintenance of his legal representatives. He was found to be 31 years of age at the time of death. Twenty years multiplier was applied and a sum of Rs. 30,000 was awarded. While applying the multiplier of 20, the learned Judge have taken note of the soaring price rise and upheld the award of the Tribunal.

37. Similarly, a Division Bench of the High Court of Guiarat in Hirji Virji Transport v. Basiran, 1971 Acc CJ 458 has held that in the days of soaring prices, the possibility of future inflation has to be taken into consideration while applying the principle of multiplier.

38. In Dewan Hari Chand v. Delhi Municipality, AIR 1981 Delhi 71 he value of dependency claimed by the father was worked out at Rs. 300 per month and Rs. 3,600 per year and the Division Bench of the Delhi Court, applying 16 years multiplier, awarded a sum of Rs. 57,600 towards damages for loss of dependency to the father.

39. In Life Insurance Corporation of India v. Karthyani, AIR 1976 Orissa 21 the Tribunal had applied 15 years multiplier. The deceased was aged about 38 years. It was held by a Division Bench of the Orissa High Court that (at p. 25):

“The Tribunal was not justified in calculating the loss of benefit to the claimants only for a period of 15 years. On the above consideration, compensation should have been calculated at least for 22 years i.e up to 60 years of the deceased.”

40. A Division Bench of the Madhya Pradesh High Court in Subhadra Bai v. M.P State Road Transport Corporation, 1977 Acc CJ 69 had considered this question. In that case, the deceased was a rickshaw puller. He died at the age of 24 years and his life span was fixed at 60 years, and he was found to be earning between Rs. 200 and Rs. 300 per month. It was also further found that he was spending Rs. 75 per month for maintenance of the appellant, his wife and the other Rs. 75 on his brother. The appellant filed the appeal in the High Court against the meagre sum awarded by the Tribunal. On the basis of the longevity of the deceased for the balance period of 36 years, it was calculated applying 20 years multiplier at the rate of Rs. 75 Per month to each and a sum of Rupees 32,400 was awarded. The said amount was to be shared between the wife of the deceased and his brother. So a sum of Rs. 15,000 was awarded to the wife.

41. A Division Bench of the Assam High Court had considered this question in Kaniia Khatun v. Union of India, 1974 Acc CJ 103 : (AIR 1974 Gauhati 1). Therein, the deceased was aged about 34 years. The Tribunal determined the life span at 55 years. When appeal has been filed by the wife, the learned Judges have held that the deceased would have lived up to 60 years and calculated the compensation with 25 years of span of life and reversed the award of the Tribunal and awarded compensation.

42. Another Division Bench of the Madhya Pradesh High Court in Suman v. General Manager, M.P State Road Transport. Corporation, 1970 Acc CJ 280 held that the deceased was spending at the rate of Rs. 125 per month to the widow and five children. The deceased on the date of accident, was aged 32 years. Applying the multiplier of 23 years, the Court awarded compensation in a sum of Rs. 15,000.

43. Though their Lordships of the Supreme Court in Madhya Pradesh State Road Transport Corporation v. Sudhakar, AIR 1977 SC 1189 (supra) took the lead and applied 20 years multiplier, the learned Judges of the Delhi Court followed Mallet v. McMonagle, (1970) AC 166 (supra) and made a step backward and applied 16 years multiplier. Similarly, a Full Bench of Punjab and Haryana High Court in Lachhman Singh's case AIR 1979 Puni & Har 50 (supra) too followed Mallet's case of House of Lords (supra), catching the forward leap given by their Lordships of the Supreme Court in Manjushri v. B.L Gupta, AIR 1977 SC 1158 (supra) and other High Courts, we applied 25 years multiplier of life span in C.M.A 161/77 dated 1-11-1982 : (AIR 1983 Andh Pra 297) and enhanced compensation.

44. The decision reported in M.P State Road Transport Corporation v. Sudhakar (AIR 1977 SC 1189) which was relied on by Sri C. Ananda Rao, the learned senior standing counsel for the Corporation, did not lay down any different principle. The facts in that case were that the wife aged about 23 years died in the accident and eleven months after the death, the husband remarried. It was found that the appellant himself is also an earning member and that he is not depending upon the earning of the wife at the time of the death. It was found that the deceased would have contributed a sum of Rs. 50 per month upon those facts. Applying the multiplier of 20 years, their Lordships of the Supreme Court confirmed the damages of Rs. 15,000 awarded by the Claims Tribunal. In view of the peculiar facts in that case, their Lordships of the Supreme Court have minimised the award of damages. But however, the principle applicable for determination of the compensation was not varied. Therefore the contention that a different principle was adopted by their Lordships of the Supreme Court to the principles applied in the cases referred to above is not tenable.

45. To apply the principle of multiplier to a given case under consideration, it is inexpedient to lay down any exhaustive guidelines, but some of them, viz., (1) the age of the deceased and of the dependants or legal representatives to determine whichever is the short period: (2) the period of dependency: (3) the quantum of annual dependency arrived at; (4) the number of dependants or legal representatives to fee maintained from out of the amount to be determined: (5) the status and comforts enjoyed before the date of accident: (6) the minimum comforts required: (7) whether the amount to be awarded would be sufficient to meet during the period of dependency; (8) education and upbringing of children in case the deceased is the bread-winner of the family; (9) marriage expenses: of the daughters: and (10) the peculiar facts of the case and other analogous or relevant circumstances may be the relevant factors to be taken into consideration to decide what number of years of multiplier has to be applied.

46. The next question for consideration is whether the loss of value in the money and the highest, rate of inflation and application of the principle of multiplier can be taken into consideration as “set off” to decide whether any deduction could be made from the compensation to be payable in lump sum. Their Lordships of the Supreme Court in Motor Owners' Insurance Co. Ltd. v. J.K Modi, AIR 1981 SC 2059 have held that (at P. 2060):—

“The delay in the final disposal of motor accident compensation cases, as in all other classes of litigation, takes the sting out of the laws of compensation because, an infant child who seeks compensation as a dependant of his deceased father has often to await the attainment of the majority in order to see the colour of the money. Add to that the monstrous inflation and the consequent fall in the value of rupee. Compensation demanded say ten years ago is less than quarter of its value when it is received today.”

47. In Union of India v. Viranwali, 1967 Acc CJ 41 a Division Bench of the Delhi High Court consisting of the Chief Justice Hegde (as his Lordship then was) and I.D Dua, J. (as his Lordship then was) have held in Para 13 that:

“The benefit of getting a lump sum payment is offset by the increase in prices and the progressive decrease in the value of the rupee.”

48. This view also gets ample support from the decisions of the House of Lords, which are stated hereunder:

In Mallet v. McMonagle, (1970 AC 166) the learned Lord Diplock in his speech, observed that—

“During the last twenty years, however, sterling has been subject to continuous inflation. Its purchasing Power has fallen at an average rate of 3 per cent to 3½ per cent per annum and the increase in wage rates has more than kept pace with the fall in the value of money.”

49-50. In Taylor v. O'Connor, (1971) AC 115 at p. 129 Lord Reid observed:

“It will be observed that I have more than once taken note of present day conditions — in particular rising prices, rising remuneration and high rates of interest. I am well aware that there is a school of thought which holds that the law should refuse to have any regard to inflation but that calculations should be based on stable prices, steady or slowly increasing rates of remuneration and low rates of interest. That must, I think, be based either on an expectation of an early return to a period of stability or on a nostalgic reluctance to recognise change. It appears to me that some people fear that inflation will get worse, some think that it will go on much as at present, some hope that it will be slowed down, but comparatively few believe that a return to the old financial stability is likely in the foreseeable future. To take any account of future inflation will no doubt cause complications and make estimates even more uncertain. No doubt we should not assume the worst but it would, I think, be quite unrealistic to refuse to take it into account at all.”

51. When the original court had increased the multiplier from 10 to 12 holding that it took inflation as the factor to increase the multiplier to a modest extent to shield the plaintiff to some extent against the effects of inflation the learned Lord pearson, in the same decision, in his speech stated:

“Certainly it is right to have regard to the prospect of continuing inflation as an important factor in the situation, but I do not think a mere increase in the multiplier is a suitable method for protecting against inflation, though it achieves something. I think protection against, inflation is to be sought by investment policy, and the lump sum of damages should be assessed on the basis that it will be invested with the aim of obtaining some capital appreciation to offset the probable rise in the cost of living.”

52. In the Court of Appeal in Cook-son v. Knowles, (1977) 3 WLR 279 at P. 283, it was contended for the Insurance Company that the dependency on the date of the death should be multiplied by the appropriate multiplier for his age and prospects, and the counsel for the widow has contended that, they should be taken at the date of the trial and then multiply by the appropriate multiplier. While considering that question, Lord Denning M.R observed that:

“We think that they should be taken at the date of trial. That is shown by the Swynfleet (1948) 81 LIL Rep 116. The practice has been for years (as we said in Jefford v. Gee. (1970-2 QB 130, 148)) to “award one lump sum calculated by taking the yearly pecuniary loss and multiplying it by the number of years' purchase.” That practice was convenient when there was little inflation. But now that inflation has become rampant and looks like continuing the practice should be altered. The pecuniary loss to the widow and children should be divided into two parts: the one part being from the date of death to the date of trial: the other part being from the date of trial onwards into the future.”

53. The approach of the Court of Appeal was upheld by the House of Lords in Cooks on v. Knowles (1979) AC 556 (supra),

54. In this context we must also observe that in a country like ours, where the social security provided either by the State or other social agencies is wholly inadequate and the infra-structure for the sustenance of the human life is not well built, the need for arousing judicial conscience of the courts to protect the dependants of this class of victims of motor accidents who are mostly Poor is the greatest. The awarding of compensation should, therefore, be on the higher side.

55. A Division Bench of Bombay High Court in The Union Of India v. Sugrabai Abdul Majid* (AIR 1969 Bom 13) took note of the fact of soaring rise in prices and the learned Judges have held that (at p. 20):—

“…… the real value of the amount of Rs. 30,000 awarded by the trial Court is much less today than it was when the amount was claimed by the plaintiffs in the suit. Under the circumstances we are of the view that the damages awarded by the trial Court are proper and a reduction in that amount would not be Justified.”

56. No doubt, we have noticed that a Full Bench of the Punjab & Haryana High Court in Lachhman Singh v. Gurmit Kaur. AIR 1979 Puni & Har 50 (supra) held that considerations of ever growing inflation and the decrease in the money value are not relevant for the purpose of assessment of compensation. But it would appear that the above case law referred to in our judgment has not been brought to the notice of the learned Judges. The only principle that laid down was that future inflation should not be taken into account in determining compensation. But the loss of value of money caused due to inflation as on the date of determination of the compensation is a relevant factor in view of the law laid down in the aforesaid decisions.

57. The Delhi High Court considered the delay in realisation of compensation occurred due to lapse of time between the date of the death and the date of realisation as a factor for not making any deduction from the lump sum as reported in Khidni v. Dayal Singh, 1969 Acc CJ 444 (Delhi).

58. We have considered this aspect in C.M.A 161 of 1977. D/- 1-11-1982 : (AIR 1983 Andh Pra 297) and we have held that the loss of money value due to inflation between the date of the death till the date of passing the award and realisation should be “set off” from making any deduction from the lump sum compensation to be determined. We have reconsidered the entire case law and in view of the law laid down in this country and in England we reiterate and hold that no reduction need be made for lump sum amount and that the loss of value of money and long delay in realisation of the compensation in the interregnum and application of the principle of multiplier will be “set off” for the deduction.

59. It was next strenuously contended by Sri C. Ananda Rao the learned senior standing counsel for the Corporation that the principle of ‘interest’ as adopted by the Courts in England and approved by the House of Lords in Cookson v. Knowles, (1979) AC 556 (supra) is the safe guide in determining the just compensation and it should be adopted. To understand the scope, ambit and its applicability of that principle to our present, day conditions, it is necessary to go into the facts and the basis on which the principles were laid down in the said decision. The said appeal (to the House of Lords) was directed against the decision of the Court, of Appeal reported in Cookson v. Knowles, (1977) 3 WLR 279 (supra). In that case, the widow claimed damages under the Fatal Accidents Act and the Land Reforms (Miscellaneous Provisions) Act 1934 against, the defendant for negligence in causing the death of the deceased in motor accident. To arrive at the annual pecuniary loss of dependency to the estate of the deceased, the period was divided into two parts, one is the earnings of the deceased from the date of accident till the date of trial and the second period from date of trial till the balance expected span of life. On the amounts thus arrived at that interest was given on the amount calculated for the first period, and interest was not awarded to the rest of the expected period of life of the deceased. This approach was adopted by the Court of Appeal to overcome the effect of inflation and the depreciation of value of money.

While adopting that procedure the Court of Appeal dismissed the appeal and confirmed the order of Assize Court. Against the said decision, appeal was filed before the House of Lords and the said principle was affirmed by the House of Lords. In view of the advanced economy and the habits of the people to make investment in the banks and purchase of the annuities and high interest yielding fixed deposits, the House of Lords approved the principle adopted by Lord Denning M.R in the Court of Appeal. Thus, it has been an established principle in the Courts of England that the determination of the damages has been decided with reference to the principle of interest. We cannot forget the fact that it is an industrially advanced country and banking system has taken deep roots and an established one in the United Kingdom, whereas in India, even till this day majority of the population in the village side are not aware of the functioning of the banking system. Even the banking system itself did not go to their door steps.

They are not aware of the interest rate on the fixed deposit and the interest rate is also an even fluctuating one. It is alien to our prevailing conditions and habits. On the other hand, it is common knowledge that any villager when he has money on hand his immediate thought is to invest on purchase of land with that money and to eke out his living by cultivation and from the produce or profits as rentals derived from the land. Application of any principle to a given case should not be mechanical. It should be realistic, pragmatic, workable, beneficial and conducive to the prevailing conditions and the habits of the people. In these circumstances, the application of the principle of interest is not only unrealistic but most unworkable and leads to disadvantage to the illiterates and ignorant legal representatives/dependants of the deceased. Therefore the “principle of interest” propounded by the learned counsel is most unworkable and inapplicable to the prevailing conditions in India.

60. The principle thus laid down in the above decisions of their Lordships of the Supreme Court and the House of Lords lead to thus: The Tribunal has to determine just, adequate and reasonable compensation to the loss of dependency caused to the legal representatives or dependants on account of the abrupt termination brought about to the life of the deceased due to tortious act of the respondent. (I)(a) The first step is to determine span of life of the deceased normally expected to live; (b) then the relative longivity of the legal representatives have to be determined: (c) then it is to be found out who are expected to live longer: (II) the second step is what are the daily, weekly or monthly earnings of the deceased on the date of the death either through employment in service, business or any pursuit or in any other manner. From out of the said earnings, what is the probable amount the deceased is expected to spend for himself, depending upon the nature of employment or status, etc. and deduct it from the total earnings and the balance amount thus arrived is the amount being spent on the legal representatives or the dependants. If there is any independent evidence on the personal expenditure of the deceased it would be the sure guide to take it into account: (III) the amount that is being expected to be spent on the legal representatives or the dependants is the amount, that will be the loss of dependency that would be caused to the legal representatives: (IV) that amount must be computed in terms of annual dependency; (V) before taking lump sum, several imponderables like vicissitudes of life, etc. have to be taken into account, viz. the possibility of the deceased earning much more income during the years to come in his balance expected span of life, the possibility of his premature death in the normal circumstances or in other accident, the possibility of his not continuing to earn during the expected balance span of life, the possibility of the dependants, the minor children becoming majors and getting self-earning capacity and thereafter cease to be depending on the deceased, the parent or parents dying earlier and also the possibility of the wife re-marrying.

But in this regard it has to be kept in mind that irrespective of the sections or class of the society from which the woman may hail, the custom in the Indian Society has entrenched deeply that the widow with minor children seldom remarry and the first sacrifice she makes is “self denial of her comforts” for upbringing the children and to cherish the memory of her late husband”. Therefore the possibility of the widow with minor children remarrying in Indian Society is a remote one. After giving due consideration to the above factors and giving a margin of errors in making an estimate and even partly conjecture, the pecuniary loss caused to the legal representatives or dependants can be ascertained by balancing on the one hand, the loss to them of the future pecuniary benefit and all the pecuniary benefits which may from whatever source come to them by reason of the death and that balance of loss and gain to dependants or legal representatives by the death, must be ascertained. Then apply suitable years of multiplier or multiplicand to determine lump sum. In ascertaining this amount, the facts and circumstances necessitating whether a reasonable amount should be given deduction since lump sum is being paid and is coming as a wind fall, is a factor to be considered.

61. Applying the above principles to the facts in this case, we have to consider what is the expected span of life of the deceased Prakasam and what were his earnings on the date of death and the loss of dependency and pecuniary advantages the appellants would have got had the life of the deceased was not prematurely terminated in the tortious act.

62. In C.M.A No. 161 of 1977 : (AIR 1983 Andh Pra 297) we have considered the entire case law regarding the increase in the life span in recent times in India and following the dictum laid down by their Lordships of the Supreme Court in Manjushri Raha v. B.L Gupta. AIR 1977 SC 1158 (supra) and other decisions of Delhi. Madras and Allahabad High Courts, we have held that the life span has been increased to 70. The deceased would have lived up to 70 years. In this case, the appellants themselves restricted the life span of the deceased at 60 years and claimed damages on that basis. The deceased was aged 30 years in “robust health” and actively engaged himself in pursuit of self-earnings. Therefore we hold that the deceased would have lived up to 60 years i.e for another period of 30 years.

63. With regard to the amount awarded for loss of ‘consortium’, it is contended that the Tribunal has not given any justifiable reason for awarding a meagre sum of Rs. 1,000 for ‘loss of consortium’. We have elaborately considered in C.M.A No. 161 of 1977 : (AIR 1983 Andh Pra 297) the circumstances under which the wife is entitled for consortium. In this case, P.W 1 (the widow) is aged about 24 years and the deceased is aged 30 years. We have held that the appellants themselves restricted the expected life span of the deceased at 60 years. Therefore, the 1st appellant would have had the married life with the deceased at least for another period of 30 years. The death had occurred at the prime of their married life and the sudden death of the deceased had put an end to the long period of their married life.

64. A Division Bench of this Court in C. Venkatesam v. General Manager. A.P.S.R.T.C Hyderabad. 1977 Acc CJ 536 : (1977) 2 APLJ (HC) 233 : (AIR 1978 Andh Pra 285) awarded a sum of Rs. 6,000 towards consortium. In K. Narayana Reddiar v. Venugopala Reddiar. (1975) 1 APLJ (HC) 191 : (AIR 1976 Andh Pra 184) another Division Bench of this court, for a widow of 51 years, a sum of Rs. 4,000 was awarded as consortium. In this case, the first appellant, aged 24 years, claimed under this court, a sum of Rs. 5,000. Following the above decisions and taking the age of the first appellant into consideration, we hold that the first appellant is entitled to a sum of Rs. 5,000 for loss of consortium to her.

65. With regard to the mental pain and suffering we have considered the same point in C.M.A No. 161/77. We have also dealt with the case law on this subject. The House of Lords, through the most illustrious Lord Chancellor Earl of Halsbury, L.C in Ownership of “Mediana” v. Owners, Master and Crew of Lightship “Comet”, 1900 AC 113 at 116 has states the difficulty in assessing compensation in terms of money for pain and suffering in the following terms:

“How is anybody to measure pain and suffering in moneys counted? Nobody can suggest that you can by any arithmetical calculation establish what is the exact amount of money which would represent such a thing as the pain and suffering which a person has undergone by reason of an accident. In truth, I think it would be very arguable to say that a person would be entitled to no damages for such things. What manly mind cares about pain and suffering that is past? But nevertheless the law recognises that as a topic upon which damages may be given.”

Following the decisions in C.M.A 161/77 : (AIR 1983 Andh Pra 297) in this case also. P.W 1 is aged only 24 years and the four children are aged 12, 10, 8 and 4 years respectively. The sudden death of the deceased Prakasam must have caused great mental pain and anguish to the first appellant as well as the children. Similarly, the father who is aged 60 years also must have suffered great mental pain and suffering since he was expecting that the deceased would maintain him in his old age. Therefore, we have no hesitation to hold that the appellants are entitled to a sum of Rs. 4,000 towards their mental pain and suffering.

66. The next Question for consideration is, what are the earnings of the deceased as on the date of death. Before deciding this question it is profitable to keep in mind the scope of the power of the Appellate Court.

67. It is a well settled position of law that the Appellate Court should always be reluctant to interfere with the findings of the trial Tribunal on any question, more particularly reluctant to interfere with the finding on damages which is different from the ordinary finding of fact: in that it is generally much more a matter of speculation and estimate. But the Appellate Court when it is satisfied that the lower Tribunal has conclude on a wrong principle of law or has misapprehended the facts or for other reasons made wholly erroneous, illusory or inadequate estimate of the damages, the Appellate Court could interfere with the finding of the lower Tribunal on the ground of either excess or insufficiency or inadequacy of damages awarded or wrong approach adopted by the original Tribunal.

68. The estimate depends upon the earnings which the deceased was getting on the date of occurrence viz. 27-11-1973. Here is a case where the deceased has been working as a coolie (labourer) and also has continuously been vending curd. It is the case of the first appellant in her evidence as. P.W 1 that the de ceased was earning a net income of Rs. 7 a day. In their petition, the appellants have claimed at the rate of Rs. 6 per day. Though it is stated in evidence that the deceased was earning at the rate of Rs. 7 per day, we have to take it that he would be earning as originally contended, at the rate of Rs. 6 Per day. It is not as if the wages for labour is static. It is a known fact that every year, wages for the labour are constantly being increased. P.W 1 has stated that he was earning Rs. 5 per day whenever he attends to coolie (labour) work and that he was also vending curd and that his daily net income would be Rs. 7. This evidence has not been shaken in cross-examination nor rebutted by adducing any independent evidence by the Corporation. Only it was suggested that his daily income would not be more than Rs. 2 or Rs. 3.

We have held in C.M.A 161/77 dated 1-11-1982 : (AIR 1983 Andh Pra 297) that often times suggestions would be made as a last resort either to cast a doubt on the veracity or slur on the credibility of the evidence of the witnesses or to diminute the financial liability that may be fastened on the respondent and that the suggestions by itself cannot be taken to have been proved on its face value unless there is evidence, documentary, oral or circumstantial to lend support thereof. We reiterate the same view in this case also, since the same are the facts in this case as well. Following that decision, we have to consider whether there is any evidence either documentary, direct, oral or circumstantial justifying the suggestion given to P.W 1 that the deceased was earning a sum of Rs. 2 or Rs. 3 per day or can it be relied upon. We have carefully gone through the entire evidence. Admittedly the Corporation did not adduce any independent evidence to rebut the evidence of P.W 1. There are no circumstances brought out in the cross-examination either to disbelieve the version of P.W 1 or what has been stated by her is not true nor can it be relied upon.

As stated earlier, it is stated in the petition that the daily earning of the deceased is Rs. 6. In view of that statement we have to state that P.W 1 perhaps exaggerated in her attempts so that if she would state higher amount at least lesser amount would be given to them and thus arose the difference of Re. 1. It is common knowledge that at least a minimum of Rs. 5 will be the wages that will be paid to the labour if they work in the fields. P.W 1 has stated in her evidence that the deceased was working in the field of Venkataramaiah and he was paying Rs. 5 per day. This evidence is not disputed. Therefore, we accept her evidence that the deceased would be earning Rs. 5 per day whenever he is attending to the work as a coolie. It is not in dispute that the deceased was vending curd and her evidence that his net profits would be Rs. 7 per day remained unshaken in cross-examination. In view of this evidence, it is reasonable to conclude that whenever the deceased had work as labourer he would be attending to the work in addition to his vending curd and that he would be paid at least Rs. 5 per day.

It is also common knowledge that in the agricultural operations there will be certain learn period where workers would not have continuous work. Therefore taking these two factors into consideration we have no hesitation to hold that the deceased would be earning at least Rs. 5 per day either for daily wages or profits in vending curd. It is reasonable to conclude that at least Rs. 1.50 ps. would be spent towards his expenditure. When we calculate at this rate, his monthly income would be Rs. 150, Alter making deduction for personal expenditure his net income would be Rs. 105 per mouth. This amount will be spent on the appellants for their maintenance and upkeep of children. Therefore their annual dependency would be Rs. 1260. The finding that P.W 1 is also engaged in work is a surmise based an no evidence. Nor was it even suggested to P.W 1 when she was cross-examined. So, this finding since is not based on any evidence, is set aside. Thus Rs. 1260 per year would be the pecuniary benefit the appellants would have got had the life of the deceased not been terminated due to the rash and negligent driving of R.W 1. The deceased would have had 30 years of life span had his life not been terminated due to rash and negligent driving of R.W 1. In C.M.A 161/77 dated 1-11-1982 : (AIR 1983 Andh Pra 297) though we did not specifically say so we have applied 25 years multiplier and determined the damages payable to the claimants therein.

69. The Courts have been adopting what is known as “favourable approach” in determining just compensation.

70. In Cookson v. Knowles. (1979 AC 556 at 575 (HL) (supra) Lord Fraser of Tullybelton, in his speech observed:

“The loss of support between the date of death and the date of trial is the total of the amounts assumed to have been lost for each week between those dates, although as a matter of practical convenience it is usual to make the median rate of wages as multiplicand. In a case such as this, where the deceased's age was such that he would probably have continued to work until the date of trial, the multiplier of this part of calculation is the number of weeks between the date of death and the date of trial. That is convenient, although it is a strictly speaking too favourable to the plaintiff, because it treats the probability that but for the fatal accident, the deceased would have continued to earn the rate for the job and to apply the same proportion of his (perhaps increased earnings to support his dependants, as if it were a certainty.”

(Underlining is supplied for emphasis).

71. In Mallett v. McMonagle. (1970) AC 166 (supra) Lord Pearson had applied “most advantageous assumption” in favour of the claimants. Lord Morris of Borth-y-Gest, in the same decision, held that the claim has to be considered “with sympathy.”

72. In view of the catena of decisions both by their Lordships of the Supreme Court. House of Lords and the other High Courts, we are inclined to apply “25 years multiplier” to the facts in this case. Multiplying the said sum Rupees 31,500 is the loss of dependency suffered by the appellants. Since we have applied multiplier principle and reduced period of earnings, no further deduction from lump sum need be made. The appellants have restricted their claim to Rs. 28,000. We have considered the entire case law once over. Therefore followings the decisions cited and principles laid down therein we hold that no deduction need be made from the lump sum amount determined above. Therefore, we hold that the appellants are entitled to compensation for loss of dependency for a sum of Rs. 28,000 and it would be just and reasonable compensation.

73. The next Question for consideration is whether the lower Tribunal is justified in awarding interest from the date of award. Normally interest would bee awarded from the date of petition and the principle off awarding interest from the date of award would be adopted in cases where fabulous amount was being awarded to the claimants.

74. In Ramesh Chandra v. Randhir Singh, AIR 1977 All 330: Hira Devi v. Bhaba Kanti, AIR 1977 Gau 31; Nityanand Dutta v. Caledonian Insurance Co., 1968 Acc CJ 368 (Cal) and Jainab Bai v. M.P State Road Transport Corporation, 1969 Acc CJ 274 (Madh Pra) it has been held that interest has to be awarded from the date of petition. Following the above decisions, we hold that the lower Tribunal ought to have granted interest from the date of the petition but not from the date of award. We accordingly modify the award of the Tribunal and grant interest from the date of petition.

75. In the result, we allow the appeal, modify the award of the Tribunal as indicated below:

The appellants are entitled to compensation under ‘first count’ a sum of Rupees 28,000 towards second count ‘Consortium’, the first appellant is entitled to Rs. 5,000 under third count ‘mental pain and suffering’ the appellants are entitled to Rs. 4,000. There is no tangible evidence regarding the value of cycle. Therefore we confirm the amount of Rs. 200 as awarded by the lower Tribunal towards the value of cycle. The appellants are entitled to interest to 6% per annum from the date of the petition till date of payment. They are also entitled to costs.

In C.M.A No. 161/77 dated 1-11-1982 : (AIR 1983 Andh Pra 297), we have taken notice of the wide talk in the corridors of the Courts that the claims under the Motor Vehicles Act have become Sold mines to the middlemen and in some cases to the persons involved in the adjudicatory process. The legal representatives of the deceased are not reaping the fruits of the award. Maior amount is being knocked off by the middlemen or in some cases by person involving in adjudicatory process. With a view to put an end to this pernicious evil percolating into the portals of the Courts and to maintain the administration of justice unsullied so as to keep public confidence in the administration of justice intact, we gave directions that the lower Tribunal should direct the appellants to open Savings Bank Account in the nearest nationalised bank or post office and the Tribunal to credit the compensation awarded to their respective shares as indicated in their petition to their account. In case of minors, we have directed that their share of amount should be kept in deposit in a nationalised bank till they attain the age of majority and that they should be Paid interest accrued thereon for their education and maintenance and the amount be paid to them on their attaining majority in the manner indicated therein.

Now we have noticed that in this case, the second appellant was aged about 12 years on the date of petition. By mow she attained majority, therefore, the Tribunal should direct the first appellant to open a Savings Bank Account in her name in the nearest nationalised bank or post office and after giving the number of the said account, the Tribunal should deposit the amount that would be payable to the first and second appellants in the manner indicated above and as per their claims, in the said account. With regard to the other minors, the Tribunal is directed to keep their amount in fixed deposit in the nearest nationalised bark till they attain majority and that the interest accrued thereon should be paid to them either annually or every six months, as the case may be and on their attaining majority the amount should be paid in the manner indicated above. With regard to the amount payable towards ‘mental pain and suffering’ all the six appellants are entitled to the amount equally. The sixth appellant should be directed to open an account in the nearest nationalised bank or post office and the amount payable to him should be deposited to that account. Costs and the value of the cycle should be paid to the first appellant.

76. The appeal is accordingly allowed as indicated above.

Appeal allowed.