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citation codes
Case Number
Attorney(S)
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Acts
  • FATAL ACCIDENTS ACT
  • provision applicable to Workmen's Compensation Act.
  • Act or the Workmen's Compensation Act.29.
  • Central Amending Act 47/1982. Ss. 92-A
  • Workmen's Compensation Act of 1923.
  • Amendment Act No. 22 of 1984
  • Workmen's Compensation Act
  • Motor Vehicles Act. S. 92-A
  • MOTOR VEHICLES ACT
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Cites
Cited by
Citation Codes
Equivalent Citations
citation codes
Case Number
Attorney(S)
Judges
Acts
  • FATAL ACCIDENTS ACT
  • provision applicable to Workmen's Compensation Act.
  • Act or the Workmen's Compensation Act.29.
  • Central Amending Act 47/1982. Ss. 92-A
  • Workmen's Compensation Act of 1923.
  • Amendment Act No. 22 of 1984
  • Workmen's Compensation Act
  • Motor Vehicles Act. S. 92-A
  • MOTOR VEHICLES ACT
Smart Summary

Structured Summary of the Provided Opinion (Full Bench — Andhra Pradesh High Court)

Factual and Procedural Background

Chakali Sangaiah, a farm servant and resident of Devi village in Kamareddy taluk (Medak District), died on March 19, 1978 in a motor accident when an Andhra Pradesh Road Transport Corporation (APSRTC) vehicle (APZ 2727) struck the bullock-cart he was driving. The cart overturned and was destroyed; one bullock died and Sangaiah was killed on the spot.

Dependants (the mother, spouse and son) claimed Rs. 50,000 before the Motor Accidents Tribunal. The Tribunal found the deceased was 24 years old, earning Rs. 100 per month, and calculated annual dependency at Rs. 600. The Tribunal assumed life expectancy to 65 years, awarded Rs. 24,000 for dependency, Rs. 2,000 for loss of consortium, and Rs. 3,000 for pain suffered by dependants; after accounting for the estate and a 15% deduction for accelerated payment, the Tribunal awarded Rs. 24,650 in total. The Road Transport Corporation appealed. The appeal was ultimately heard by a Full Bench because the case engaged important questions about the use of Annuity Tables and principles applied in prior decisions (notably the "carpenter's case" — Chairman APSRTC v. Shafiya Khatoon).

Legal Issues Presented

  1. Whether Annuity Tables (A.Ts) are appropriate or permissible to determine compensation in motor accident death claims in India, and if so, whether the approach taken in Chairman APSRTC v. Shafiya Khatoon (the "carpenter's case") should be followed.
  2. Whether Annuity Tables prepared for other countries (or tables in foreign texts) can be applied or used as a cross-check in Indian motor accident cases in the absence of India-specific A.Ts.
  3. Whether compensation awarded for "pain suffered by the dependants" (mental agony/mental pain) is legally supportable.
  4. On the facts of this case, what is the correct quantum of compensation for the dependants of Chakali Sangaiah and related heads (loss of consortium), and whether interest and other deductions (e.g., for accelerated payment) should apply.

Arguments of the Parties

Appellant — Andhra Pradesh State Road Transport Corporation (APSRTC)

  • The Corporation urged that the methods indicated in Chairman APSRTC v. Smt. Shafiya Khatoon (the "carpenter's case") should be followed for ascertaining compensation — i.e., use of Annuity Tables and the multiplier approach adopted in that decision.

Claimants / Dependants

  • The dependants originally claimed Rs. 50,000 before the Tribunal. The Tribunal's findings (age 24, salary Rs. 100 per month, annual dependency Rs. 600, life expectancy 65 years) formed the factual basis of their entitlement; the Tribunal awarded dependency, loss of consortium and an amount for pain suffered by dependants.

The opinion does not contain a detailed, point-by-point narrative of other parties' legal submissions beyond the Corporation's reliance on the carpenter's case and the factual claims presented to the Tribunal.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Chairman APSRTC, Hyderabad v. Smt. Shafiya Khatoon, AIR 1985 Andh Pra 83 (the "carpenter's case") Use of Annuity Tables to fix compensation; selection of a multiplier (16) after cross-check with tables; adoption of Table No. IV (Kemp & Kemp 1967) as guide. The Full Bench scrutinised this decision, found how multiplier 16 was chosen to be obscure, and ultimately reversed the approach adopted there (holding that A.Ts prepared abroad cannot presently be used in India as a standard). The carpenter's case was expressly reversed by the majority.
Lai Wee Lian v. Singapore Bus Service (1978) Ltd., (1984) 3 WLR 63 (Privy Council — "Singapore case") Explained the nature and proper effect of Annuity Tables and held their use was not improper or objectionable if properly appreciated. The Court adopted the Privy Council's explanation to hold that the use of A.Ts is not per se improper or illegal; however, it distinguished the Singapore decision on grounds of available Indian tables and applicability.
Sheikhupura Transport Co. Ltd. v. Northern India Transport Insurance Co., AIR 1971 SC 1624 One of the earlier Supreme Court authorities on principles for ascertaining damages (multiplier approach in practice). The carpenter's case was said to conflict with principles indicated in this decision; the Full Bench referred to it in discussing established practice and multipliers used by higher courts.
C.P. Sikh Regular Motor Service Ltd. v. State of Maharashtra, AIR 1974 SC 1905 Supreme Court authority relevant to multipliers/compensation calculation practices. Referenced among prior authorities with which the carpenter's case was in tension; used to illustrate historical multipliers applied by courts.
Srisailam Devastanam v. Bhavani Pramilamma, AIR 1983 Andh Pra 297 Applied an award of Rs. 2,000 towards "mental pain suffered" by claimants (a head akin to mental agony). The Full Bench held that decision cannot be supported in law and overruled it on the question of awarding compensation for dependants' mental pain.
Gobald Motor Service Ltd. v. Veluswami, AIR 1962 SC 1 Set out a five-principle formula for ascertaining damages in death cases (expectation of life, amount required for future provision, multiplication by years, discounting for lump sum, deductions for remarriage/earlier death etc.). The Court recapitulated and relied on the historical centrality of these principles in Indian jurisprudence on motor accident compensation.
C.K. Subrahmonia Iyer v. T. Kunhikuttan Nair, AIR 1970 SC 376 Restatement of the principles for assessment of damages and limits to what is recoverable as pecuniary loss. Referenced as continuing authority explaining that damages are limited to pecuniary loss and are fact-specific; used to support adherence to traditional approach.
Smt. Manjushri Raha v. B.L. Gupta, AIR 1977 SC 1158 Reviewed compensation practice and abandoned one of the five principles (the "fourthly" principle relating to acceleration benefit deduction); showed higher awards in some contexts and no deduction for accelerated payment. The Court noted this decision's influence and the related practice; it was used to explain variations in approach (notably non-deduction of accelerated payment in some later cases).
United India Fire & General Insurance Co. v. K. Anuradha, (1980) 1 APLJ 34 Applied the principle of non-deduction of accelerated payment following Manjushri v. B.L. Gupta in the Court's practice. The Full Bench cited this case as an example where non-deduction was followed.
Nasiruddin v. Kadir Ahmed, (1986) 1 ACJ 94 (Madhya Pradesh case) Rejected claims for compensation for "pain and suffering" of dependants arising from accidental death. The Full Bench relied on this decision to hold that awards for pain suffered by dependants lack foundation in law and to negate the Rs. 3,000 awarded by the Tribunal in the present case under that head.
N. Sivammal v. Managing Director Pandian Roadways Corpn., AIR 1985 SC 106 Supreme Court held that compensation cannot be awarded for agony suffered by dependants. The Court cited and followed this Supreme Court authority to refuse the Tribunal's award for mental agony of dependants and to confirm that such awards cannot legally be sustained.
Municipal Corporation of Delhi v. Subhagwati, AIR 1966 SC 1750 Example Supreme Court multiplier authority (deceased aged 30; multiplier 15). Referenced by the minority opinion as one of the Supreme Court multipliers to show practice on multipliers generally applied by higher courts.
M.P.S.R.T. Corporation v. Sudhakar, AIR 1977 SC 1189 Another Supreme Court example of multiplier application (age 23; multiplier 20). Used in the minority opinion to demonstrate the range of multipliers historically applied by the Supreme Court.

Court's Reasoning and Analysis

The Full Bench (majority: Raghuvir, J. for himself and Ramanujulu Naldu, J.) proceeded through a structured analysis:

  1. Preliminary facts and Tribunal findings were accepted in part: deceased age 24; funeral findings showed monthly salary Rs. 100; Tribunal had computed annual dependency at Rs. 600 and assumed life expectancy to 65 years.
  2. The Corporation urged reliance on the "carpenter's case" (Chairman APSRTC v. Shafiya Khatoon), where a Divisional Bench had used Annuity Tables (Kemp & Kemp Table No. IV, 1967 edition) and selected a multiplier of 16 (after cross-checking table multipliers). The Bench examined that approach in detail.
  3. The Court analysed the nature, merits and limitations of Annuity Tables (A.Ts):
    • A.Ts are arithmetical tables based on mortality tables and assumed compound interest (the Privy Council in the Singapore case explained them as calculations assuming investment at a specific interest rate, e.g., 5%).
    • A.Ts are used internationally, and their use is not intrinsically improper; the Privy Council's Singapore decision was adopted to accept that A.Ts are not illegal or objectionable per se.
    • However, A.Ts and the mortality tables on which they are based are country-specific. The Full Bench emphasised that in India no Annuity Tables prepared for local conditions exist; searches and inquiries by the Court were unfruitful.
    • The Court expressed concern that the carpenter's Bench picked multiplier 16 in an obscure way, reducing an empirically derived figure (16.85) to 16 to account for contingencies without satisfactory explanation.
  4. The Court examined statutory material: the amended Workmen's Compensation Act (Amendment Act No. 22 of 1984) introduced a substituted Section 4 and Schedule (Schedule IV) providing prescribed factors (multipliers) for workmen between ages 16 and 65 using a fixed dependency percentage (40% for fatal accidents). The Court analysed why that statutory table does not straightforwardly solve the problem in motor accident claims:
    • Workmen's Compensation Act uses a wage-based dependency fixed at 40%/50% and statutory factors tied to wages; in motor accident compensation, "dependency" and "compensation" are variable and depend on income (not strictly wages) and the unique facts of each case.
    • The Court noted the conceptual difference between "wage" and "income" and the difficulty of converting income into wages for the purpose of applying the Workmen's Compensation schedule.
  5. On precedent and past principles, the Court retraced the evolution from the five principles in Gobald Motor Service Ltd. v. Veluswami (1962) through subsequent Supreme Court cases. The Court emphasised that, for decades, courts used the traditional method (estimating annual pecuniary loss and discounting to lump sum with appropriate deductions), and the carpenter's case represented a departure not sufficiently grounded in India-specific actuarial data.
  6. Concerning the Tribunal's award of Rs. 3,000 for "pain suffered by the dependants," the Court found no legal foundation for such awards in precedent. It relied on Nasiruddin v. Kadir Ahmed and N. Sivammal v. Managing Director Pandian Roadways Corpn. (AIR 1985 SC 106) to hold that compensation for dependants' mental agony is not sustainable. The Court therefore negated that head of damages and also overruled Srisailam Devastanam v. Bhavani Pramilamma insofar as it supported awards for dependants' mental pain.
  7. Application to the present facts and fixation of compensation:
    • The majority considered the Tribunal's annual dependency figure (Rs. 600) proper.
    • On life expectancy, the majority adjusted the Tribunal's assumption (65 years) downward to 60 years for a farm servant; consequently they used a multiplier of 36 (the balance of probable life years) so that 600 × 36 = Rs. 21,600 for dependency.
    • The Tribunal's Rs. 2,000 for loss of consortium to the spouse was left intact.
    • Rs. 3,000 awarded for pain to dependants was rejected as legally unsupportable.
    • The Court ordered the Corporation and the Insurance Company to pay Rs. 21,600 (dependency) plus Rs. 2,000 (consortium), with 6% interest from date of death until payment. The appeal was allowed in part; cross‑objections dismissed; no costs ordered.
  8. The majority expressly reversed the carpenter's case and indicated that Annuity Tables could be re‑considered if A.Ts are prepared for Indian conditions in the future. The majority thus accepted that A.Ts have value in principle but refused to apply foreign/foreign-derived tables as determinative in India where local A.Ts are not prepared.
  9. Minority view (Upendralal Waghray, J.): the minority disagreed with the majority's categorical refusal to use A.Ts in all cases. The minority considered it appropriate until India-specific A.Ts are prepared to use the Schedule IV table of the Workmen's Compensation Act (introduced July 1984) as a guide subject to judicial modification on stated reasons. Applying that approach, the minority would have applied the Schedule IV factor (18.25) to the annual dependency of Rs. 600 to yield Rs. 10,950 for dependency and, with Rs. 2,000 for consortium, a total of Rs. 12,950 — thereby modifying the Tribunal's award differently from the majority.

Holding and Implications

Holding (majority): APPEAL ALLOWED IN PART.

Core rulings and direct effects (as given in the opinion):

  • The majority reversed the "carpenter's case" (Chairman APSRTC v. Shafiya Khatoon, AIR 1985 Andh Pra 83) insofar as it treated foreign Annuity Tables and the multiplier adopted there as a proper method for fixing compensation in Indian motor accident claims in the absence of India-specific A.Ts.
  • The Court held that while Annuity Tables are not intrinsically improper or illegal (adopting the Privy Council's reasoning), there are no Annuity Tables prepared for Indian conditions; consequently, A.Ts prepared for other countries or derived from foreign mortality tables should not be relied upon as standard in India at present.
  • The Court rejected awarding compensation for "pain suffered by dependants" as legally unsustainable, relying on Madhya Pradesh and Supreme Court authorities, and overruled Srisailam Devastanam v. Bhavani Pramilamma insofar as it supported such awards.
  • On the facts of this case the majority fixed compensation as follows: Rs. 21,600 to the dependants (600 × 36), plus Rs. 2,000 for loss of consortium to the spouse; both amounts carry 6% interest from date of death until payment. The Rs. 3,000 awarded by the Tribunal for dependants' pain was set aside. The appeal was allowed in part; cross‑objections dismissed; no costs.
  • The Court indicated that if Annuity Tables are prepared in India in the future, it may revive the discussion about their use.

Implications noted by the Court (limited to what is stated in the opinion):

  • The decision directs that existing foreign Annuity Tables or tables in treatises cannot be treated as authoritative for India until tables prepared specifically for Indian conditions exist.
  • The opinion narrows the heads of recoverable damages by excluding awards for dependants' pain/mental agony, aligning with recent Supreme Court authority.
  • The minority offered a contrasting approach (use Schedule IV of the Workmen's Compensation Act as a guide), but the majority did not adopt it; thus, for now, traditional methods (estimating annual dependency, selecting an appropriate life-span/multiplier, and discounting as appropriate) remain authoritative absent India-specific A.Ts.

No additional findings, settlements, or procedural directions beyond those summarized above are contained in the provided opinion.

    The Andhra Pradesh State Road Transport Corporation, Hyderabad v. Ch. Narasavva And Others

    Raghuvir, J. (for himself and on behalf of Ramanujulu Naldu, J.) (Majority view):— Chakali Sangaiah was a farm servant. He was a resident of Devi village in Kamareddy taluk of Medak District. He died on March 19, 1978 in a Motor accident. The accident occurred while Sangaiah was driving a bullock-cart at 5 Kms. stone on Kamareddy-Yellareddy highway. The Andhra Pradesh Road Transport Corporation vehicle APZ 2727 dashed against the cart. The cart turned turtle and broke into pieces. One of the bulls died. Sangaiah died at the spot.

    2. The dependants of the deceased-mother, spouse and son — the three claimed Rs. 50,000/- before the Motor Accidents Tribunal. In the inquiry it was disclosed Sangaiah was 24 years of age at his death. He was paid Rs. 100/- salary for a month by his employer. On the above evidence the Tribunal held that deceased would have lived up to 65 years. The dependency of the three claimants on that basis was determined at Rs. 600/- per annum. Compensation of Rs. 24,000/- was awarded to them. Rs. 2,000/- was awarded to the spouse of the deceased for loss of consortium. A further sum of Rs. 3,000 was awarded to the three claimants towards pain suffered by them on the death of Sangaiah. From out of the total Rs. 29,000/- fifteen per cent was deducted towards accelerated payment of compensation. Thus the three were awarded the total amount of Rs. 24,650/-. The Road Transport Corporation aggrieved thereby preferred the instant appeal.

    3. The appeal was heard by one of us (Justice G. Ramanujulu Naidu). At the hearing the case in The Chairman APSRTC, Hyderabad v. Smt. Shafiya Khatoon, (AIR 1985 Andh Pra 83) was offered by the Corporation to follow the methods indicated in the case for ascertaining the compensation. That was a case of a carpenter who died in a motor accident. This case will be referred hereinafter as ‘carpenter's’ case. In that case a Divisional Bench of this Court made new approaches in fixing compensation. Naidu, J. observed the new principles evolved in the case are in conflict with principles indicated in three cases in Sheikhupura Transport Co. Ltd. v. Northern India Transport Insurance Co.† , AIR 1971 SC 1624, C.P Sikh Regular Motor Service Ltd. v. State of Maharashtra, AIR 1974 SC 1905 and Srisailam Devastanam v. Bhavani Pramilamma, AIR 1983 Andh Pra 297. The appeal, therefore was suggested to be heard by a Full Bench of the Court. That explains the entire case before the Full Bench.

    4. We think it convenient now to set out facts to show the new approach made in Carpenter's case (AIR 1985 Andh Pra 83). The carpenter was from Hanumakonda town. He died on November 21, 1977 in a motor accident. He was aged 22 years. His earnings were ascertained at Rs. 400/- per month. The mother and four unmarried sisters of the deceased claimed compensation before the Tribunal. The estate of the carpenter was ascertained to be of Rs. 500/-. Out of the earnings of Rs. 400/- it was held five dependants might have received Rs. 1,500/- per annum. This figure was arrived after making allowances for various contingencies. The tribunal held the life expectancy of carpenter was cut short by 48 years. On that premise Rs. 72,500/- was awarded compensation. This Court on appeal enhanced the dependency to Rs. 2,400/- per annum. For fixing compensation this Court made reference to Annuity Tables (A.T). A multiplier of 16 was sorted out from facts of the case. That multiplier 16 how it was sorted out we will return to that aspect immediately. The compensation was fixed (Rs. 2400 × 16) at Rs. 38,400/-. That amount inclusive of Rs. 500/- the value of the estate of the deceased together was awarded compensation to the five dependants of the carpenter. These are the facts in the carpenter's case.

    5. This is the first case by this Court when compensation is fixed with the assistance of Annuity Tables. Therefore a brief discussion on relevance of A.T is not out of place. Annuity Tables are used in death duty case, pension cases and in cases where actual considerations are relevant like life insurance policies. In motor accident cases in the past few years. A.T tables are used in many advanced countries. Annuity Tables are prepared with the assistance of mortality tables. In some countries mortality tables are prepared for males and females separately. Annuity table thus have reference to compound interest and the tables are prepared with reference to stable periods of economy of the relevant country. The Annuity Tables do not claim accuracy as their fine point. But A.Ts do achieve a certain degree of accuracy is not doubted. Whatever the level of accuracy A.Ts may have achieved the tables suffer the odium of being conjectural estimates. That in brief is the merit and demerits of Annuity Tables.

    6. The A.Ts are current now in all advanced countries in ascertaining damages. The adoption of A.Ts in the third world in motor accident cases is of recent practice. In India in motor accident cases A.Ts are not used because A.Ts are not prepared in this country. We have made repeated inquiries as to existence of any tables for motor cases. Our own search in this regard was not fruitful.

    7. In compensation cases whether it is legal to use A.Ts was mooted repeatedly in foreign Courts till recently. The Judicial Committee of Privy Council set at rest doubts in a recent Singapore case. That case is Lai Wee Lian v. Singapore. Bus Service (1978) Ltd., (1984) 3 WLR 63. We will refer this case as Singapore case. It was argued in Singapore case the user of A.T is contrary to law. Because A.Ts are not part of any statute or any enactment, it was contended no legislative sanction existed for their application in motor accident cases. Further it was thought the user was improper. The arguments in the Singapore case show the user of A.Ts was alleged also objectionable.

    8. The Judicial Committee of Privy Council explained the user of A.Ts was not improper or objectionable, provided the true effect of Annuity Tables is correctly appreciated. We borrow a little more from the discussion from that case. In that how A.Ts are explained; how A.Ts are prepared “A.Ts are arithmetical tables showing results of certain laborious calculation always on the assumption that a sum whether received in damages or in any other way is invested at five per cent interest……” The calculations were not to be confused with “actuarial”. The ratio in the Singapore case is adopted for our discussion, though our association with the Judicial Committee of Privy Council may not exist today. The respect, however, which we had shown to Privy Council cases in two centuries in the past has ripened with years. The observations of the Judicial Committee, therefore, are adopted. We hold it is not improper, illegal or objectionable to use Annuity Tables in motor accident cases.

    9. Back again to carpenter's case (AIR 1985 Andh Pra 83) it is seen the deceased was 22 years at the accident. The Divisional Bench considered a multiplier of 16 is “reasonable” to ascertain compensation. How the multiplier 16 was picked out is rather obscure in the decision. In para 63 it is prefaced the carpenter was not a salaried person. His earning capacity extended beyond 65 years. To “cross check” the choice of sixteen the Divisional Bench had recourse to the tables in para 31. If tables are used to cross-check it is all the more important to explain how multiplier 16 was picked out. From out of the table in para 31, multiplier 16.85 was picked out to cross-check. But 0-85 was reduced to set off contingencies like carpenter dying early, his sisters marrying soon, his earning capacity likely to diminish in later years. The multiplier of 1685 was reduced to sixteen. Thus, “the multiplier sixteen selected by us compares favourably with the one arrived at by the use of actuarial or annuity tables. Therefore, it is clear that the multiplier of forty either adopted by the tribunal is hopelessly arbitrary.” Thus Rs. 72,500/- was reduced to Rs. 38,400/- was awarded by this Court.

    10. In the Singapore case ((1984) 3 WLR 63) it is shown A.Ts are prepared by Messrs Murphy and Dunbar, Solicitors. In United Kingdom organization referred in the Law Commission Report on personal injuries prepared the Annuity Tables. In India as on today we see no A.Ts are prepared. The table No. IV in para 31 is with compound interest having relevance to the economy of the country in the calendar year 1967. In para 30 of the Carpenter case (AIR 1985 Andh Pra 83) the Divisional Bench observed:

    “There are several tables provided in Kemp & Kemp on ‘uantum of Damages' (1967 Ed.) as also fresh tables in their 1982 Ed. The multipliers in the latter edition are higher in view of the improved health conditions in England. Having regard to Indian conditions we are of the view that the Table No. IV (General Mortality Males) in the 1967 Ed. and which is prepared by calculating present value at 5½ discount rate are useful for crosschecking the multiplier which the Court might otherwise fix from its experience. Table No. IV gives multipliers for those earning up to the end of their life and also those who earn up to 65 years. We are extracting the table in so far as those earning up to 65 years and the multipliers in cases of those earnings for life i.e beyond 65 years are mentioned in brackets. Conversely if the earning capacity is to cease at the 55th or 60th year the multipliers in Table IV have to be slightly reduced. The table is based on mortality figures for males and in cases where the deceased is a female the multipliers from the Tables are to be slightly reduced.”

    This discussion shows the authors have not prepared the table for the use in India so we cannot use the tables which was prepared on the basis of mortality tables of other countries.

    11. The table in the case was adopted by the Divisional Bench as “stable period of our country”. Sure in that sentence stability of India is pointed out “as pointed out by Lord Biplock in Mallett v. McMonagle, 1970 AC 166. This is another reasoning which, with great respect, we are not able to share.

    12. Since we accept Annuity Tables strike a greater degree of accuracy in estimation of damages, we have invain searched for tables in any statute for the use in motor accident case. In that search we scrutinised the table introduced by the Parliament of India in Amendment Act No. 22 of 1984 with effect from July 1, 1984 in Workmen's Compensation Act of 1923. The substituted table under S. 4 of the Act is to the effect — the amount of compensation shall be

    “(a) Where death re-suits from the injury— An amount equal to 40% of the monthly wages of the deceased workman multiplied by the relevant factor: or an amount of Rs. 20,000 whichever is more: (b) Where permanent total disablement results from the injury. an amount equal to 50% of the monthly wages of the injured workman multiplied by the relevant factor: or an amount of Rs. 24,000 whichever is more.”

    In (a) and (b) multipliers are referred ‘factors’. It is seen ‘dependency’ in (a) and (b) is a non-variable factor: in all cases it is constant at 40% in (a) and 50% in (b). Compensation of Rs. 20,000/- in the event of death and Rs. 24,000/- in the event of permanent disablement is constant, when it works out less than that amount.

    13. In motor accident cases dependency and compensation are variable factors depending on facts. Besides in law there exists a discernible difference in concept of a wage and an income. The distinction in concepts defies all attempts to convert income in terms of wages. Having regard to these constraints the table of this Act is not helpful in motor accident cases.

    14. We may now recapitulate how compensation was fixed by Courts in the past two decades. In Gobald Motor Service Ltd. v. Veluswami, AIR 1962 SC 1 the first case dealt by the Supreme Court a formula of five principles was laid for ascertaining damages. In that case it was held “pecuniary loss” and its estimation is a conjecture. In that conjecture attempt is made to balance imponderables like future benefit and unforeseen contingencies. In the words of Supreme Court, what those five principles are explained. “The deceased man's expectation of life has to be estimated having regard to his age, bodily health and the possibility of premature determination of his life by later accident, secondly, the amount required for the future provision of his wife shall be estimated having regard to the amount he used to spend on her during his lifetime, and other circumstances; thirdly, the estimated annual sum is multiplied by the number of years of the man's estimated span of life, and the said amount must be discounted so as to arrive at the equivalent in the form of lump sum payable on his death; fourthly further deductions must be made for the benefit accruing to the widow from the acceleration of her interest in his estate; and fifthly, further amounts have to be deducted from the possibility of the wife dying earlier if the husband had lived the full span of life; and it should also be taken into account that there is the possibility of the widow remarrying much the improvement of her financial position.”

    15. Between 1962 and 1977 these five principles were followed. The principle, however, was restated in a different tone, but to the same effect. The case of C.K Subrahmonia Iyer v. T. Kunhikuttan Nair, AIR 1970 SC 376 was a case of parents who on loss of a child in a motor accident claimed compensation and to meet the contingency of a non-earing person a different note was struck. That variation is not relevant for the present discussion. The restatement of the principles is contained in para 14 of that case. “The law on the point arising for decision may be summed up thus: Compulsory damages under S. 1-A of the Act for wrongful death must be limited strictly to the pecuniary loss to the beneficiaries and that under Section 2, the measure of damages is the economic loss sustained by the State. There can be no exact uniform rule for measuring the value of the 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 of 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 matters which rest in speculation or fancy though conjecture to some extent is inevitable. As a general rule parents are entitled to recover the present cash value of the prospective services of the deceased minor child. In addition they may receive compensation for loss of pecuniary benefits reasonably to be expected after the child attains majority.”

    16. Seven years later in Smt. Manjushri Raha v. B.L Gupta, AIR 1977 SC 1158 again cases were reviewed. The scope of damages in motor accidents and accidents in air crafts were compared. A passenger travelling by plane dies in an accident, he gets compensation of Rs. 1,00,000; when death comes to a passenger in a motor vehicle it was pointed out such a passenger was awarded Rs. 2,000/-. This elucidation was made to highlight discrimination. The relevance of the case is to show how compensation was ascertained for in that one of the five principles (the fourthly principle) was abandoned.

    17. The deceased in that case was thirty years. He was a salaried person. He would have reached the maximum grade in the time scale of Rs. 900 at the age of 46. “The claimant has produced a certificate Ex. P4 from the office of the Accountant General, Madhya Pradesh, Gwalior, which shows that from April 11, 1962 (i.e the date next to the date of the death of Satyendra Nath Raha) to October 15, 1980 which would be the last working of the deceased Raha, the deceased Raha would have drawn Rs. 1,89,402/- including the increments earned and the maximum grade drawn. This figure may be rounded off to Rs. 1,88,000/-. Even if half of this be deducted as being rightly taken to have been spent by the deceased to cover day to day domestic expenses, the actual income lost to the family including the value of the estate, was estimated in Rs. 90,000/-

    18. What is of importance in that case is no deduction was made for accelerated payment. This variation was followed by this Court in United India Fire & General Insurance Co. v. K. Anuradha, (1980) 1 APLJ 34. In para 14 this Court relevant to non-deduction of accelerated payment observed: “We, therefore, do not see any reason to reduce the amount of compensation any further when in fact the amount of compensation payable to the claimants in accordance with the decision of the Supreme Court in Manjushri v. B.L Gupta, AIR 1977 SC 1158 would be much higher than what is actually claimed by them.” But for this variation what was laid down in the first case on the subject in Hindustan Ideal Insurance Co. v. P. Ankaiah, (1972) 1 APLJ 47 up to Carpenter case was followed. See for instance in Govt, of Andhra Pradesh v. Mrs. K. Padma Rani, AIR 1976 Andh Pra 122 calculations are shown in para 27 of the case. Thus for three decades the five principles were followed by Courts in India. For all the aforesaid reasons, we reverse the carpenter's case (AIR 1985 Andh Pra 83). If in future A.Ts are prepared in India, we may revive the discussion.

    19. Since the entire appeal is referred to Full Bench we now fix compensation on the facts of the case. The deceased Sangaiah was paid salary of Rs. 100/- per month. On that basis annual dependency of dependants ascertained in Rs. 600/- by the Tribunal which is not improper. The Tribunal estimated life expectancy of Sangaiah was 65. Knowing farm servants as we do, we consider 60 years is proper. The compensation on that basis is 600 × 36: Rs. 21,600/-. The spouse of the deceased was awarded an amount of Rs. 2,000/- for loss of consortium. We do not interfere with the amount fixed on this head of compensation.

    20. Finally, a question is raised as to Rs. 3,000/- damages awarded for pain suffered by the dependants of Sangaiah was proper and legal. We have not been cited any case and we are not aware of any principle where compensation was awarded for pain suffered by dependants of the deceased, except in one case by this Court. In Madhya Pradesh case in Nasiruddin v. Kadir Ahmed, (1986) 1 ACJ 94 such a claim was negatived emphatically. We borrow a passage in that case to illustrate the point: “His another submission is that the applicants should also have been compensated for their pain and suffering from the accidental death of Salim. So far as the latter submission of the learned counsel is concerned, suffice it to say that there is no foundation in law for advancing and basing such a claim. The Tribunal has rightly rejected the same.” (Para 6). The Supreme Court in a recent case in N. Sivammal v. Managing Director Pandian Roadways Corpn., AIR 1985 SC 106 held no compensation can be awarded for agony suffered by the dependants and confirmed the view of the High Court. In para 4 the High Court held that “award of Rs. 5,000/- under the head mental agony suffered by the claimants as a result of the death of the deceased cannot legally be sustained.”

    21. In a decision of this Court in Srisailam Devastanam v. Bhavani Pramilamma (AIR 1983 Andh Pra 297), Rs. 2,000/- was awarded towards: “mental pain suffered” by the claimants in para 34 of the case. The decision cannot be supported in law, therefore, we overrule the case.

    22. We hold the Corporation and the Insurance Company are liable to pay Rs. 21,600/- towards compensation to the dependants of Sangaiah, Rs. 2000 damages to the spouse of the deceased. The two amounts carry 6% interest from the date of death till payment is made.

    23. The appeal is allowed in part as indicated above. No costs.

    24. For the same reasons, the Cross-objections are dismissed. No costs.

    Upendralal Waghray, J. (Minority view):— 25. I had the advantage of perusing the judgment prepared by my learned brother Raguvir, J. but with respect I am not able to agree with him that in all cases Annuity Tables are not yet prepared and therefore cannot be used for determining the compensation in the claim for death under the Motor Vehicles Act.

    26. Deaths in Motor Vehicle Accidents are on the increase and consequently the number of claims. The cases reported and unreported show the wide variation in the determination of compensation by the various Courts and Tribunals in cases with similar facts. Determination of compensation always involves a certain amount of conjecture and the endeavour of the Court is to evolve some basis to minimise conjecture and avoid the wide variation in the awards of Tribunals and Courts in similar cases.

    27. As has been pointed out by my learned brother in several countries the Annuity Tables are adopted for determining the compensation payable under the Motor Vehicles Act. The Privy Council and House of Lords in England and Courts in other Countries have also approved their use. The objection is that no such Table is available, for our conditions and, therefore, we should await the preparation of such a Table for considering their use.

    28. In the decision reported in Chairman APSRTC Hyderabad v. Shafiya Khatoon AIR 1985 Andh Pra 83 which is referred to as the Carpenter's case, a Bench of this Court has made use of Table No. 4 (General Mortality Tables in England referred to in 1967 Edition of Kemp & Kemp on Damages) as a guide for determining the compensation. This is the first time in our country that Annuity Tables have been used for this purpose. It is not in dispute that even in England subsequent tables have been prepared and are now in use and they yield a more liberal compensation. Is the table referred to in that judgment proper for our condition? Chapter VIII of the Motor Vehicles Act contains the provisions regarding the constitution of Tribunals, making of claims, enquiry and awards. It also provides for insurance of vehicles and the liabilities of the Insurer. For compensation in Fatal Accidents the provisions of Fatal Accidents Act has to be kept in view. S. 110-AA gives an option to a claimant to avail to the remedy under this Act or the Workmen's Compensation Act.

    29. The Parliament has by the amending Act 22 of 1984 which has come into force on 1-7-1984 substituted a new section 4 and the corresponding Schedule 4 in the Workmen's Compensation Act. Relevant portion of S. 4 of the Act is extracted in the main judgment of my learned brother. The Table in Schedule 4 of that Act contains a table for calculation of compensation for workmen between the ages 16 and 65 by applying the corresponding factor mentioned in it. S. 4 provides for adopting 40 per cent of the monthly wages as dependency in case of Fatal Accidents and 50 per cent of the monthly wages in case of accidents resulting in permanent disability. This has to be multiplied by the relevant factor against the age in the Schedule for determining compensation. As the dependency is calculated on a monthly wage basis the factor is based on such calculation. In case of annual dependency this factor will have to be divided by 12. At age 16 the multiplier on annual dependency comes to about 79.05, for age 20. it comes to about 18.65 and for age 65, it comes to about 8.3 According to S. 4 of that Act compensation payable for death is as determined by multiplying the dependency with the factor or Rs. 20,000/- whichever is more. By the Central Amending Act 47/1982. Ss. 92-A to E were introduced in the Motor Vehicles Act. S. 92-A provides for a no fault liability of Rs. 15,000/- in case of death. This may be adopted as the minimum compensation in case of accidents after that date. S. 92-D makes this provision applicable to Workmen's Compensation Act.

    30. Several variables and imponderables have to be taken into consideration for determining the compensation which may comprise of distinct and separate heads. But the controversy now is limited to the determination of the cash value of loss of dependency of the claimants on the basis of the annual dependency already ascertained. The annual dependency is in the nature of an annuity. The present value of rupee in an annuity is calculated for various purposes by the use of actuarial tables which are prepared taking into consideration the mortality tables, rate of interest etc. Such tables are used for payment of commuted cash value of pension for tax purposes etc. Their use in total accident claims and particularly Fatal Accident Claim has been approved by the Courts in various countries. No such Table for calculation of compensation under the Motor Vehicles Act has been prepared in our country so far. The legislature, the Government and the various Institutions like Indian Statistical Institution and actuaries may have to bestow attention on this. The tables are generally based on the probabilities of the deceased surviving from year to year and the rate of compound interest adopted. These will require a study of mortality tables, the present and probable future interest structure, effect of inflation etc.

    31. In my opinion till any such table specially meant for Motor Vehicle Claims is prepared it will be appropriate to use the Table in Schedule IV of the Workmen's Compensation Act as a guide. It does not mean that the hands of the Court are tied by the result arrived at by the table. The Court may on relevant material and stated reasons appropriately modify the multiplier applicable or the figure of compensation arrived at from the table. What those relevant material and reasons are, is not possible to define exhaustively. Some examples are death of a minor child with no income sole claimant being an aged mother, a large number of minor or female dependants with no other support.

    32. The alternate method adopted by my learned brother is to multiply the annual dependency with the balance of the probable life span. With respect, I am not able to agree to this method. There is no deduction for lump sum payment. In none of the reported cases such a large multiplier has been adopted. In all cases deduction is made for lump sum cash payment. The multipliers applied by the Supreme Court in the following cases have to be noticed:

    Name of citation. Age of deceased. Multiplier. 1. Municipal Corporation of Delhi v. Subhagwati. AIR 1966 SC 1750 30 15 2. Sheikhupura Transport Co. v. N.I.T Ins. Co., AIR 1971 SC 1624 42 15 3. CPSRM Service v. State of Mah., AIR 1974 SC 1905 25 20 4. M.P.S.R.T Corporation v. Sudhakar. AIR 1977 SC 1189 23 20

    33. In many tables a compound interest between 4 and 5 per cent and longevity of 65 years is adopted as the basic criterion. The maximum multiplier is generally around 20. No judgment of Supreme Court and this Court has disapproved of the view of Annuity Tables. It is difficult to discover principles, capable of ready and uniform application on the large number of decisions reported in our country.

    34. As noticed above the relevant factors for preparing the Annuity Table include the probability of a person surviving to a particular age and the rate of compound interest assumed for a stable economy. It cannot be disputed that the life span and probability of survival in developed countries is more than in India. A table prepared taking this into account will be more beneficial for claimants as a lower mortality rate will lead to higher multiplier. A higher rate of interest will result in a lower multiplier in an annuity table. If the present interest rates prevailing in the market are adopted the multiplier will be very low. A compound interest at a rate between 4 and 5 per cent is used assuming a period of stable economy and to provide for the effects of inflation and erosion of currency. Another recognised method of determining compensation is by providing a lump sum payment which on investment will yield in interest equivalent to the annual dependency. In such cases the manner of disposal of the capital available at the end of the dependency and its impact will also have to be considered. To minimise conjectures, I am of the opinion that the Annuity Tables should be adopted as a guide in determining the compensation in cases under the Motor Vehicles Act. The Table in Schedule IV of the Workmen's Compensation Act introduced in the July, 1984 is applicable for workmen mentioned in that Act who are wage earners. It is slightly more beneficial to the claimants than the table in the compensation case. It can be adopted in preference to the table adopted in the carpenter's case. Appropriate weightage in the case of earner for life can be given by adopting a higher multiplier from the said table. The table does hot make any distinction between a male and a female deceased. Therefore, till a table is prepared specifically for the purposes of claims under the Motor Vehicles Act it will be appropriate to follow the Table in Schedule IV to the Workmen's Compensation Act for determining the compensation in Motor Vehicles Claims also.

    35. In the instant case the annual dependency is determined at Rs. 600/-. The deceased was an agricultural labour aged 24. The Tribunal has adopted a multiplier of 40 assuming a longevity of 65. The claimants are mother, widow and minor son of the deceased. The multiplier applicable with reference to the factor in Schedule IV of the Workmen's Compensation Act is 18-25 and according to it the compensation under this head will be Rs. 600 × 18.25: Rs. 10,950/-. As the accident was in 1978 there is no statutory minimum available under S. 92-A. There is no material to show that the compensation arrived at by applying the table should be varied i.e either increased or decreased. The death had occurred in March, 1978 and the award was passed by the Tribunal in February, 1979. The award is modified by substituting the figure of Rs. 10,950/- plus Rs. 2,000/- for loss of consortium to the widow i.e Rs. 12,950/-.

    Appeal partly allowed.

    Use AI to get other relevant cases.

    Comments

    The Andhra Pradesh State Road Transport Corporation, Hyderabad v. Ch. Narasavva And Others
    (Dec 19, 1986)