John Mathew, J.:— Whether the salary of a dependant who was given employment on compassionate grounds on the death of a person who was injured in a motor accident is to be deducted from the compensation payable on account of his death? The learned Tribunal deducted a portion of the amount from the total amount of compensation. In this appeal by the petitioners before the M.A.C.T, they are mainly challenging the direction to deduct a portion of the salary that the 1st petitioner widow may receive throughout her career.
2. The 1st petitioner before the Tribunal is the widow and petitioners 2 and 3 are the minor children of deceased V.R Aravindakshan Nair, who died in a motor accident. Subsequently additional petitioners 4 and 5 who are the father and mother of the deceased were also impleaded. While the deceased was traveling in a jeep KLK 7675 belonging to his employer (Rubber Board, Kotiayam) in connection with his official duty, it met with an accident. According to the petitioners, the jeep was being driven in a rash and negligent manner by she 3rd respondent. The vehicle was not roadworthy. The accident took place due to this reason as well as to the rash and negligent driving of the vehicle. In the accident the deceased sustained serious injuries and succumbed to the injuries within four hours of the accident. The deceased who was aged 29 years, was employed as Research Assistant in the Pathology division of the Rubber Board (1st respondent) on a monthly salary of Rs. 1171, Rs. 90. But for his death he could have continued. In service up to the age of 58. He was a Post Graduate in Agriculture. He would have got promotion to post of Director. Even after retirement he could have worked and earned. At the time of his death fee had put in three years of service. The pay scale of Research Assistant was revised wish effect from 1-1-1986. On completion of 10 years of service normally a Research Assistant would get promotion to the higher grade. His total emoluments by the time be retired from service would have been Rs. 13.09 lakhs. However, the petitioners claimed only Rs. 6 lakhs as compensation after giving allowance for the imponderables as well as the amounts that the deceased would have spent upon himself. The 1st respondent contended that the accident happened solely due to the breaking of the propeller shaft, as a result of which the jeep overturned to the right side, on which side the deceased was sitting. It was contended what on the date of accident the jeep was in perfect running condition and there was no rashness or negligence on the part of the 3rd respondent driver. It was also contended that the compensation claimed was highly excessive. Promotions to higher posts such as Deputy Director and Director are made by direct recruitment based on the prescribed qualifications. The deceased was not entitled to promotion to those posts merely by virtue of the number of years of service. The deceased did not have a doctorate in the specified branch. It was further contended that the 1st petitioner who is the widow of the deceased was given a posting in the Rubber Board on compassionate grounds as L.D Clerk in the grade of Rs. 260-400. Therefore. In case the Rubber Board was liable to pay compensation the fact that the 1st petitioner has been provided with a job, is to be taken into consideration. In fixing the amount of compensation. The 1st respondent filed an additional written statement contending that in any view of the case the salary of the deceased at the time of the accident alone could be taken into consideration. Respondents 2 and 3 also filed separate written statements.
3. The petitioners produced Exts. A1 to A6. The 1st petitioner was examined as P.W 1. The respondents produced Exts. B1 to B9 and examined three witnesses as R.Ws 1 to 3.
4. The points that arise for consideration are: (i) Whether any part of the salary that may be received by the 1st petitioner should be deducted from the total amount of compensation payable? (ii) What is the compensation payable in this case?
5. Point No. (i): It is admitted that the 1st petitioner was appointed es a Lower Division Clark in the Rubber Board on compassionate grounds on account of the death of her husband in the motor accident in the grade of Rs. 260-400. Therefore, according to the 1st respondent-Rubber Board, this fact should also be taken into consideration in fixing the compensation. Under Section 11OB of the Motor Vehicles Act, 1939 (corresponding to Section 168 of the Motor Vehicles Act, 1988) the Claims Tribunal constituted under the Act is to determine ‘the amount of compensation which appears to it to be just’.
6. Therefore, the petitioners are entitled to just compensation on account of the death of the 1st petitioner's husband. It is admitted that the 1st petitioner who is the widow of the deceased was appointed a Lower Division Clerk in the grade of Rs. 260-400 in the Rubber Board (1st respondent). The primary liability for payment of compensation is on the Rubber Board. It was, therefore, that the Board contended that the circumstance that the 1st petitioner was given employment on compassionate grounds should also be taken into consideration in fixing the compensation.
7. It cannot be disputed that the 1st petitioner got appointment on compassionate grounds since her husband died while he was serving the Rubber Board. Even in case her husband had died due to natural reasons, she would have been given an employment on compassionate grounds. In most Government services and services under private and public institutions there are provisions for giving employment to one of the legal representative of an employee who dies in harness. No provision was brought to our notice to treat this benefit as part of the compensation legally due to the legal representatives of an employee who happen to the in a road traffic accident. The 1st petitioner most have the minimum educational qualification for appointment as L.D Clerk. She will have to work as a Clerk in order to earn her salary. It cannot be said that her salary is paid on compassionate grounds. In case she was not employed as an L.D Clerk in the Rubber Board, the Board might have appointed another suitable candidate to that post. In other words, the Board is not incurring any additional expenditure on account of the employment given to the 1st petitioner. If due to some unforeseen reason she discontinues the employment, she will not get back any amount deducted on account of her employment. Thus the only benefit that she obtained as a direct result of the death of her husband is the employment she got in the Rubber Board. It is not just or proper to value this benefit or a percentage of the total salary she may draw throughout her career. If we attempt to values the employment of the 1st petitioner in terms of money, it will be necessary to enter the field of surmises without any guidelines. Therefore, it is safer to treat the employment given to the 1st petitioner purely as a compassionate gesture on the part of the Rubber Board, for which the petitioners should be thankful to the Board. There are no justifiable reasons to deduct any amount on account of the employment given to the 1st petitioner, from the compensation that may be doe to the petitioners under the Motor Vehicles Act. This view is supported by judgment of the Honourable Supreme Court as well as different High Courts.
8. The Supreme Court in N. Sivammal v. Managing Director, Pandian Roadways Corporation, 1985 A.C.J 75 held that the deduction of pensionary benefit from the compensation amount in a fatal accident case was not justified.
9. In Rukmani Devi v. Om Prakash, 1990 A.C.J 687, the Supreme Court did not approve the direction of the High Court reducing the compensation award on the ground that no pecuniary loss was caused to the claimants as the partnership badness was being carried on by the claimants and that they were deriving benefit from that business.
10. The Kerala High Court in Nazeema v. George Kuriakose, 1991 (2) K.L.J 232, held that the life insurance money, provident fund, gratuity and pensions payable to the defendants upon the death of a motor accident victim are not deductible from the amount of compensation payable under the Act. According to that judgment these benefits are not received by them by reason of his death although it was payable or receivable at the death of the deceased.
11. A five Judges Bench of the Gauhati Hight Court in Saminder Kaur v. Union of India, 1987 A.C.J 7 considered the question whether the benefits received by the legal representatives of the deceased, such as insurance policy amount, family pension, gratuity, provident fund, etc. are deductible from the amount of compensation which the claimants are found entitled to, and held that-these benefits are not liable to be deducted. According to that judgment, the widow is receiving family pension under the service conditions of the deceased. The provident fund, or pension, or gratuity are deferred payments for satisfactory service or savings and contributions of the deceased employee. His family would have been entitled to get these amounts even in case the employee died a natural death. The life insurance payment was payable because premiums were paid by the deceased and a contract was entered into for such payment on death. According to the Judgment the wrong doer cannot be permitted to gain or to take advantage of these payment's by deducting the payments received by the family of the deceased under these heads. According to the judgment ‘just compensation’ means the act or action of making up, making good or counterbalancing; rendering equal; amending.
12. The Gujarat High Court in Arunaben v. Mehmoodbhai, 1983 ACJ 409, held that the widow's income from the employment she obtained on account of the death of her husband cannot be takes into account while assessing damages since such income is not a benefit in consequence of the death. While taking this view the court also observed that the dependents' own income is not relevant because such income is not a benefit in consequence of the death but a consequence of the dependent's own work.
13. In Chander v. Bhawani Singh, 1989 ACJ 106 Rajasthan High Court held that it after the death of the husband, the widow is courageous enough to run the business of her deceased husband and is able to earn something out of it, it cannot be said that the income derived by her is on account of death of her husband. Therefore the said amount cannot be deducted from the amount of compensation which may be awarded to the widow. Following Arunaben v. Mehmoodbhai, 1983 ACJ 409, this view was taken by a later decision of the Rajasthan High Court in Chhagan Kanwar v. Pep Singh, 1991 ACJ 162, where it was held that no deduction of any amount on account of pension and the employment of the eldest son of the deceased ought to be made from out of the compensation amount.
14. The Andhra Pradesh High Court also held (D. Balakrishna v. Prabha Hingorani, 1988 ACJ 883) that the earnings of the widow of the deceased from bar profession an a Doctor cannot be deducted from the amount of compensation to be awarded.
15. The Delhi High Court in Nirmala Sharma… v. Raja Ram…, A.I.R 1982 Delhi 233, held that no deduction should be made from the compensation on account of gratuity, pension, provident fund and insurance sines those benefits cannot be considered as death benefits. The legal representatives were entitled to these benefits even otherwise on retirement of the deceased or on the maturity of the insurance policy.
16. The Madras High Court also held (A.P Dorairaj v. State, A.I.R 1974 Mad. 252) that any amount paid to the injured by his employer gratuitously and on compassionate grounds cannot be taken into account in assessing the liability. In adopting this view the Madras High Court followed Liffen v. Watson, (1940) 1 KB 556, Dennis v. London Passenger Transport Board, (1948) 1 All ER. 779, Judd v. Hammersmith, W.L & S.M Hospitals (1960 1 All ER. 607 and Perry v. Cleaver, 1969 A.C.J 363. The Court did not follow the decision in Brewning v. War Office, (1962) 3 All ER. 1089.
17. Before the Orissa High Court Central Reserve Police Force v. Minati Dhal, 1993 A.C.J 760) a question similar to the question raised in this appeal came up for consideration. The widow of the deceased was given employment on compassionate grounds. The Court held that the employment on compassionate grounds was not a account of the death of her husband in the motor accident. Therefore for determination of compensation the fact of employment of the widow ought not to be taken into consideration.
18. It is sow settled that in all claims for appointment on compassionate grounds, there should not be any delay in appointment since the purpose of providing appointment on compassionate grounds is to mitigate the hardship due to death of the bread earner in the family. It is also well settled that if there is no suitable pose for appointment supernumerary post should be created to accommodate the applicant. (See Sushma Gosain v. Union of India, (1989) 4 SCC 468 : A.I.R 1989 S.C 1976 and Smt. G. Brigithama v. State Of Kerala, 1990 (1) K.L.T 399). Therefore it can be said that the right to get employment in the dying in harness scheme is a separate and distinct right which is available in the case of death of the employee due to natural reasons also. This is an additional ground to hold that the compensation payable in a motor accident cannot be reduced on account of the giving of employment to any one of the legal representatives of the deceased.
19. Accordingly we hold that no portion of the pension insurance money, gratuity, provident fund or any gratuitous payment received by the legal representatives of a deceased employee can be deduced from the amount of compensation payable to them under the M.V Act. So also the salary or any part thereof which may be payable to the widow from the employment given to her on compassionate grounds on account of her husband's death cannot be deducted from the compensation payable to her under the M.V Act. No part of the income that the widow or other legal representatives may be getting from any business or profession, whether it is a continuation of the business of the deceased or a new business started by them can be deducted from such compensation.
20. Even so we have to observe that the learned Tribunal fixed the compensation on wrong basis and on the high side, apparently intending to deduct a portion of the salary that may be obtained by the 1st appellant. This view must have weighed with the learned Tribunal in fixing a higher compensation. Therefore we do not think that it will be proper to set aside the reduction ordered by the Tribunal and to fix the gross amount as the compensation. The proper compensation has to be refixed. Instead of remanding this old case for a fresh assessment of compensation. We are of the view that in this appeal itself this Court may fix the quantum of compensation payable.
21. In K.S.R.T.C v. Susamma Thomas, 1994 (1) K.L.T 67, the Supreme Court held that the multiplier method is the appropriate method for computing the compensation grid only in very exceptional cases a departure from this may be justified. In that judgment the Supreme Court emphasised that the claimants are entitled to a just compensation and the multiplier method is the accepted method of ensuring a just compensation which will make for uniformity and certainly of the awards.
22. In Mallett v. Momonagle, (1969) 2 All ER. 178, which was a case under Fatal Accidents Act, 1846, the House of Lords observed that the Court will not only have to measure the dependency as it exist but must regard the future as well. In other words reasonable future probabilities as well as the uncertainties of life and any evidence relating to relevant economic trends will also have to be considered. In that case the House of Lords indicated that the income which may be obtained if the compensation amount is wisely invested in long term securities should in approximately equal to the dependency at the time of death. The Supreme Court in K.S.R.T.C v. Susamma Thomas, 1994 (1) K.L.T 67, adopted an almost similar test in fixing the multiplier to be applied in quantifying the compensation. We respectfully adopt the principles set out by the Supreme Court in the said judgment.
23. From Ext. A4 it is seen that the deceased was working as a Research Assistant at the time of death on a monthly salary of Rs. 1171/90 in the pay scale of Rs. 550-900. In the normal course the deceased would have become eligible to the grade of Rs. 2200-4000 on completion of 10 years of service in the revised scale of pay with effect from 1-1-1986. The deceased was not entitled to the post of Deputy Director or Director because he had no Doctorate Degree.
24. The measure of damage is the pecuniary loss suffered by the dependents, in consequence of the death of the deceased. Such loss can be ascertained oily by balancing on the one hand the loss of the future pecuniary benefit and on the other any pecuniary advantage which comes to them by reason of she death. Many imponderables have to be taken info account, for example, the life expectancy of the deceased and the defendants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have lived or the dependants may not lived up to the estimated remaining period of their life expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether. Taking note of these aspects the income of the deceased available for the support of himself and his dependants is to be ascertained. From this figure such part of his income as the deceased was accustomed to spend upon himself is to be deducted. Than that should be capitalized by multiplying it by a figure representing the proper number of year's purchase. As held by the Supreme Court in K.S.R.T.C v. Susamma Thomas, 1994 (1) K.L.T 67.
“Much of the calculation necessarily remains in the realm of hypothesis “and in that region arithmetic is good servant but a bad master” since there are so often many imponderables. In every case “it is the over-all picture that matters”, and the court must fry to assess as best as it can the loss suffered”.
25. In that judgment the Supreme Court enunciated guidelines for the ascertainment of the multiplier and also the other aspects to be considered in fixing the compensation. The choice of the multiplier is determined by the age of the deceased or that of the claimants whichever is higher and by the calculation as to what capital sum, if invested at a rate of interest appropriate to a stable economy, would yield the multiplicand by way of annual interest. In ascertaining this, regard should also he had to the fact that ultimately the capital sum should also be consumed up over the period for which the dependency is expected to last.
26. In the present case the deceased was aged 29 years at the time of his death. The 1st petitioner was aged 28 years and the minor children were aged 2⅓ years and 9 months respectively. Without faking into account the higher post of Deputy Director and Director the deceased would have become eligible to the grade of Rs. 2200-4000 on completion of 10 years of service. The increments he would have earned in the grade he was working is also to be taken info consideration in determining the salary he would have earned until the age of retirement. The deceased in this case had a more or less stable job. Having regard to his prospects of advancement in the future carrier it is only proper in making a higher estimate of monthly income at Rs. 3,000/- as the gross income. From this his personal expenses are to be deducted. In the absence of evidence the deduction of ⅓rd of the gross income as adopted by the Honourable Supreme Court is adopted in this case also. The balance amount of Rs. 2,000/- is fixed as the amount likely to have been spent on the members of the family and dependants which will work out to Rs. 24,000/- per year. It capitalised on a multiplier of 15, the compensation would work out to Rs. 3,60,000/. Although the deceased was only 29 years old, we have fixed multiplier as 15 only taking note of the income which may be obtained if the compensation amount is wisely invested. In any nationalised bank the investment will fetch at least 10% interest. Under the facts and circumstances of this case we are of the view that this is fair and reasonable estimate.
27. The learned Tribunal awarded Rs. 5,000/- towards pain and suffering of the deceased. Over and above this amount, an amount of Rs. 15,000/- was awarded for loss of consortium to the wife and loss of affection and care to the children. There are no grounds to modify she award under those heads. Accordingly the award of the learned Tribunal is modified and a fresh award is passed in favour of the appellant against the respondents for a sum of Rs. 3,80,000/- with interest at 12% per annum from 12th October, 1982 till realization and proportionate costs. The 2nd respondent shall deposit the amount within one month from today. Appellants 4 and 5 are entitled to Rs. 10,000 each with proportionate interest thereon. Remaining amount wish proportionate interest and costs shall be shared by appellants 1 to 3 equally. The 1st appellant shall be entitled to withdraw her ⅓rd share of the compensation amount. The share of appellants 2 and 3 being minors shall be deposited in any of the nationalised backs earning maximum interest till they attain majority. The 1st appellant will be at liberty to draw the interest every month to meet the expanses of the minors. This appeal is allowed as above with proportionate costs.
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