IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 29TH DAY OF MAY, 2019 PRESENT THE HON’BLE MRS. JUSTICE B. V. NAGARATHNA AND THE HON’BLE MR. JUSTICE K. NATARAJAN MISCELLANEOUS FIRST APPEAL No.3228 of 2015 (MV) c/w MISCELLANEOUS FIRST APPEAL No.4552 of 2015 (MV) In MFA No.3228 of 2015 BETWEEN:
M/S. SHRIRAM GENERAL INSURANCE COMPANY LTD., No.5, 3RD FLOOR MONARCH CHAMBERS, INFANTRY ROAD, BANGALORE.
NOW REPRESENTED BY ITS M/S. SHRIRAM GENERAL INSURANCE COMPANY LTD., No.302, 3RD FLOOR, S&S CORNER BUILDING, OPP. BOWRING AND CURZON HOSPITAL, SHIVAJINAGAR, BANGALORE – 560 001. REPRESENTED BY ITS LEGAL OFFICER.
... APPELLANT (BY SRI B.C. SHIVANNE GOWDA, ADVOCATE) AND:
1. AJIT NARAYANA PATAKI S/O. NARAYAN G PATAKI, NOW AGED ABOUT 55 YEARS, 2. SANKET, S/O. AJITH NARAYANA PATAKI, AGED ABOUT 26 YEARS, BOTH ARE RESIDING AT No.305, CORONA APARTMENTS, 6TH CROSS, MCEHS LAYOUT, SHIVARAMAKARANTH NAGAR, BANGALORE – 77.
3. E. RAJA, S/O. ELLAPAN, MAJOR, No.3/400C, KOLLAPATTI, PULIANCHERI, KURUBARAHALLI POST, KRISHNAGIRI DISTRICT, TAMIL NADU STATE.
... RESPONDENTS (BY SRI K.T. GURUDEV PRASAD, ADVOCATE FOR R-1 & R-2; R-3 IS SERVED AND UNREPRESENTED) THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD DATED 13.01.2015 PASSED IN MVC No.754/2014 ON THE FILE OF THE I ADDITIONAL SMALL CAUSES JUDGE, 27TH ADDITIONAL CHIEF METROPOLITAN MAGISTRATE, MACT, BENGALURU, AWARDING A COMPENSATION OF Rs.53,31,024/- WITH INTEREST @ 6% P.A FROM THE DATE OF PETITION TILL REALIZATION.
In MFA No.4552 of 2015 BETWEEN:
1. SRI AJIT NARAYANA PATAKI S/O. NARAYAN G. PATAKI, AGED ABOUT 55 YEARS, 2. SRI SANKET A.P., S/O. AJITH NARAYANA PATAKI, AGED ABOUT 26 YEARS, BOTH ARE RESIDING AT No.305, CORONA APARTMENTS, 6TH CROSS, MCEHS LAYOUT, SHIVARAMAKARANTH NAGAR, HOSUR – 77.
(BY SRI K.T. GURUDEV PRASAD, ADVOCATE) AND:
1. THE MANAGER, SRIRAM GENERAL INSURANCE CO. LTD., S-5, 3RD FLOOR, MONARCH CHAMBERS, INFANTRY ROAD, BANGALORE – 560 001.
2. SRI E. RAJU, S/O. ELLAPAN, No.3/400C, KOLLAPATTI, PULIANCHERI, KURUBARAHALLI POST, KRISHNAGIRI DISTRICT, TAMILNADU – 635 001.
... APPELLANTS ... RESPONDENTS (BY SRI H.N. KESHAVA PRASHANTH, ADVOCATE) THIS MFA IS FILED UNDER SECTION 173(1) OF MV ACT AGAINST THE JUDGMENT AND AWARD DATED 13.01.2015 PASSED IN MVC No.754/2014 ON THE FILE OF THE I ADDITIONAL SMALL CAUSES JUDGE, 27TH ADDITIONAL CHIEF METROPOLITAN MAGISTRATE, MACT, BENGALURU, PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION.
THESE MFAs COMING ON FOR ADMISSION THIS DAY, NAGARATHNA. J., DELIVERED THE FOLLOWING:
JUDGMENT Though these appeals are listed for admission, with the consent of learned counsel on both sides, they are heard finally.
2. MFA No.3228/2015 is filed by Insurance Company while MFA No.4552/2015 is filed by claimants, both assailing the judgment and award passed by Motor Accident Claims Tribunal, Bengaluru, (hereinafter referred to as ‘Tribunal’ for the sake of convenience) in MVC No.754/2014 on 13.01.2015.
3. For the sake of convenience, parties shall be referred to in terms of their status before the Tribunal.
4. The claimants being husband and son of Smt.Pragati Ajit Pataki (Smt.Pragati) filed the claim petition under Section 166 of The Motor Vehicles Act, 1988 seeking compensation, on account of the death of Smt.Pragati in a road traffic accident that occurred on 20.09.2013. On the said date, at about 9.30 a.m., Smt.Pragati and her son Sanket A.P. were proceeding on a motorcycle bearing Regn.No.KA-03-HH-8641. The motorcycle was being driven by Sanket and Smt.Pragati was the pillion-rider. They were proceeding on outer ring road from Western towards Eastern direction. When they reached near KEB Office on the said road, the driver of the lorry bearing Regn.No.TN-29-AK-1486 drove the same in a rash and negligent manner endangering human life and dashed against the motorcycle from behind. As a result, the rider and pillion rider fell down. Smt.Pragati, the pillion rider, sustained grievous injuries to her backbone and other parts of the body and she was shifted to Zion Hospital, Bengaluru and given first aid treatment and later to Sparsh Hospital, Bengaluru for better treatment, but she succumbed to the injures on 27.09.2013 at about 8.40 a.m. The motorcycle was completely damaged. Her son also sustained simple as well as grievous injuries. In respect of those injuries, he had filed MVC No.755/2014.
The dead body of Smt.Pragati was shifted to Bowring and Lady Curzon Hospital, Bengaluru, where post-mortem was conducted and, thereafter, funeral rites were held at her native place. Contending that they had lost the bread- earner of the family, her husband and son filed the claim petition in MVC No.754/2014 seeking compensation on various heads.
The claim petition was resisted by respondent No.1- Insurer. The owner of the Lorry bearing Regn.No.TN-29- AK-1486 did not appear and contest the claim petition despite service of notice. In fact, he was placed ex parte in both the claim petitions. The Insurance Company, through its counsel, filed written statement denying the contents of claim petition and further submitted that claimants were not the residents of Bengaluru and that the Tribunal at Bengaluru had no jurisdiction to entertain the claim petition and also denied issuance of Policy in respect of Lorry bearing Regn.No.TN-29-AK-1486. Subsequently, additional written statement was filed wherein, it was admitted regarding the issuance of Policy in respect of the vehicle in question, but contended that the Insurer was not liable to satisfy any award to be paid and it sought for dismissal of the claim petition.
5. On the basis of the rival pleadings, the Tribunal framed the following issues for its consideration:
“ Issues in MVC No.754/2014 1. Whether petitioner proves that on 20.09.2013 at 9.30 a.m. near KEB junction on Nagavara Ring Road, HBR Layout, Bangalore, when deceased Pragathi7 Ajit Pataki was going on Motorcycle bearing Regn.No.KA-03-HH 8641 as a pillion rider along with the rider of Motorcycle from West to East direction, at that time, the driver of the Lorry bearing Regn.No.TN-29-AK-1486 driven the said vehicle with high speed, in rash and negligent manner and dashed to the deceased, by which she sustained grievous injuries and died in the Hospital on 27.09.2013 at about 8.40 a.m.?
2. Whether respondent No.1 proves that as on the date of accident, the driver of the offending vehicle was not having valid and effective driving licence?
3. Whether the petitioner is entitled for compensation? If so, to what amount and from whom?
4. What Order or award?”
6. In support of their case, the claimants examined the son of the deceased as PW.1. He also examined himself as PW.2 in MVC No.755/2014. He produced 34 documents, which were marked as Exs.P.1 to P.34. The respondent- insurer examined Smt.Tulasi Kumar as RW.1 and Sri Shivananda K.S., Deputy Manager of Insurance Company as RW.2. Respondent No.1-insurer produced five documents, which were marked as Exs.R.1 to R.5. On the basis of evidence on record, the Tribunal answered issue No.1 in the affirmative and issue No.2 in the negative and awarded compensation of Rs.53,31,024/- along with interest at 6% p.a. from the date of petition till complete realization and fastened the liability on respondent No.1-
Insurance Company. Being aggrieved by the judgment and award of the Tribunal, the Insurer as well as claimants have preferred the aforesaid appeals.
7. We have heard learned counsel for the Insurance Company and learned counsel for the claimants and perused the material on record as well as the original record.
8. Learned counsel for the appellant-Insurer Sri B.C.Shivanne Gowda, at the out set, fairly contended that he would not press the aspect of negligence in these appeals. In respect of MVC No.755/2014, the Company had satisfied the award of compensation to Sanket A.P., the injured claimant in the said claim petition. He, however, submitted that the quantum of compensation awarded in this case is on the higher side. In this regard, he drew our attention to Exs.P.13 and P.13A to contend that Tribunal was not right in deducting only a sum of Rs.5,125/- towards Income Tax deduction and a sum of Rs.200/- towards Professional Tax. He contended that the gross income of the deceased was Rs.76,430/-. She would have paid income tax at 30%. Having regard to the date of the accident, which is 20.09.2013, he contended that deductions may be made in terms of 30% of the earnings and accordingly ‘loss of dependency’ may be assessed. He also contended that although the Tribunal has assessed compensation on the head of loss of dependency, in substance, claimants are not entitled to any compensation on that head as claimants are the husband and son of the deceased Smt.Pragati, who are having independent income and further the deceased’s husband was also receiving family pension. In the circumstances, compensation ought to have been awarded only in terms of loss of estate quantified at 20% of the net income. He contended that the award of compensation on the other heads are also on the higher side and, therefore, the compensation has to be re-assessed and reduced in this case.
9. In this regard, he further submitted that in the event this Court is to award compensation on the head of loss of dependency, then spilt multiplier formula must be adopted as the deceased was aged 54 years at the time of the accident and she would have retired from service at 60 years in which event, after retirement, she would have received only pension being 50% of her gross salary and since multiplier of 11 is applied having regard to the age being 54 years and she would have retired at 60 years, the split multiplier of 6+5 would have to be adopted. Learned counsel for the Insurance Company contended that in such an event, the compensation awarded by the Tribunal would have to be reduced.
10. Per contra, learned counsel for the claimants submitted that the Tribunal has not taken into consideration the future prospects as the deceased was working as Private Secretary to the Chief General Manager (NWO) CFA in the Office of Chief General Manager Telecom, Karnataka Circle, Halasuru, Bengaluru, which is a public sector unit, she would have received enhanced pay- scale with effect from 01.01.2016. Having regard to her age being 54 years, at least 15% of her gross income must be increased towards future prospects. He further submitted that the split multiplier formula ought not to be applied in the instant case and that the claimants were indeed depending on the income of deceased Smt.Pragati. That, the compensation cannot be awarded only on the head of loss of estate. They were depending on her income, which is evident from the evidence of PW.1, her son. Therefore, the Tribunal rightly awarded compensation on the head of loss of dependency. He further submitted that award of compensation on the conventional heads must be re-assessed as no compensation has been awarded towards incidental charges such as conveyance, attendant charges and other incidental charges when the deceased Smt.Pragati was treated in the hospital prior to her death. He contended, if the compensation is re- assessed, then the appeal filed by the Insurance Company may be dismissed and the appeal filed by the claimants may be allowed.
11. Having heard learned counsel for the respective parties, the following points would arise for our consideration;
“ i) Whether the award of compensation by Tribunal calls for any modification?
ii) If so, what order? ”
12. The claimants have established before the Tribunal that on 27.09.2013 Smt.Pragati died on account of serious and grievous injuries sustained by her in the road traffic accident that occurred on 20.09.2013. In fact, she died while receiving treatment on 27.09.2013. It has also been established that the driver of the Lorry bearing Regn.No.TN-29-AK-1486 drove the same in a rash and negligent manner and as a result, hit the motorcycle from the hind side resulting in the death of Smt.Pragati and injuries to her son Sanket A.P. The controversy in this appeal is however with regard to the quantum of compensation awarded by the Tribunal. The Tribunal awarded a total sum of Rs.53,31,024/- with interest at 6% per annum from the date of petition till realization in the following manner:
Loss of dependency -Rs. 51,65,424/-
Total : Rs.53,31,024/-
13. The first aspect to be considered is with regard to whether claimants are entitled to any compensation on the head of loss of dependency.
14. Learned counsel for the appellant-Insurer submits that the husband and son of the deceased Smt.Pragati were earning independent income and they were not depending on the deceased and hence, on the head of loss of dependency, no compensation could be awarded and at best, what could be awarded is towards loss of estate.
15. However, on perusal of the evidence of PW.1, it is noted that nothing to that effect has been elicited in the cross-examination. Even though it has been stated that Sanket was doing part-time job apart from prosecuting his studies, the income from the said part-time job is not brought in evidence. It is not known as to what exactly the income was and as to whether that income was sufficient for him so as to not depend upon his mother. Similarly, it is not known as to what the earnings of deceased husband were. In the circumstances, it cannot be held that the claimants were not depending on the deceased. Hence, it has to be observed that the claimants are entitled to compensation on the head of loss of dependency and not just on loss of estate.
16. While calculating compensation on the head of loss of dependency, it is noted that the deceased Smt.Pragati was aged about 54 years. She was working as Private Secretary to the Chief General Manager (NWO) CFA in the Office of Chief General Manager Telecom, Karnataka Circle, Halasuru, Bengaluru, she would have retired on 30.06.2019. That means, she was about 54 years of age. The gross salary of the deceased was Rs.76,430/-, which is corroborated by Exs.P.13 and P.13A. RW.1 was examined by the Insurance Company with regard to salary details. It has been stated by RW.1 that out of the gross salary, deductions were made towards Professional Tax and Income Tax apart from other deductions. It has also been stated that certain monetary benefits have been paid to the family members of the deceased Smt.Pragati and the deceased, Smt.Pragati’s husband was receiving monthly pension of Rs.17,875/-, which has been categorically stated in the cross-examination, to be 50% of the pension paid to a retired person and 50% of the salary is paid as pension to a retired employee. In the circumstances, the contention of learned counsel for the appellant-insurer is, since multiplier of 11 is being applied and she would have retired in the year 2019, which means she had about six years of service, therefore, the net salary to be taken into consideration must be after deduction towards Professional Tax and 30% towards Income Tax. If the same is taken note of, then out of the gross salary of Rs.76,430/-, the annual salary would have to be first determined which would be Rs.9,17,160/- and a sum of Rs.2,400/- towards Professional Tax and a sum of Rs.61,500/- towards Income Tax, totaling would be Rs.63,900/- rounded off to Rs.64,000/- has to be deducted. Thus, the net annual salary is Rs.8,53,160/-, 15% of the said amount would have to be added towards future prospects having regard to the latest dictum of the Hon’ble Supreme Court in the case of National Insurance Company Limited vs. Pranay Sethi and others reported in (2017)16 SCC 680 [Pranay Sethi]. As the deceased was 54 years of age and there was every possibility of her receiving higher pay-scale, having regard to the revision of pay- scale pursuant to Pay Commission Report with effect from 01.01.2016, the net annual salary would be Rs.9,81,134/-.
17. According to learned counsel for the appellant- insurer, split multiplier formula would have to be applied. In support of his submission, reliance is placed on a decision of co-ordinate Bench of this Court in the case of Union of India and others vs. K.S.Lakshmi Kumar and others reported in ILR 2000 KAR 3809 [K.S.Lakshmi Kumar], wherein his Lordship Raveendran J., writing the judgment for the Division Bench of this court at Paragraphs 16 and 17 has held as under:-
“16. Where the multiplier applicable is higher than the number of years of service which the deceased had before superannuation, the contribution to the family (or loss of dependency) cannot obviously be calculated with the reference to the salary income, for the entire period of multiplier. Let us illustrate. If a person aged 56 years (whose age of superannuation is 60 years) dies in an accident, leaving behind him surviving his wife and two children, how should the total loss of dependency be calculated? Let us assume that his salary was Rs.6,000.00 and after retirement, his pension would be Rs.3,000.00.
Under the Davies method accepted and adopted by the Supreme Court, the applicable multiplier will be '9'. But, deceased would have got salary income for only 4 years and then he would get only pension. If the deduction towards personal and living expenses of the deceased is one-third, the contribution to the family during the period of service (4 years period) would have been Rs.4,000/- (that is Rs.6000-2000). But, obviously the contribution to the family would not have been Rs.4,000/- after his retirement, that is from the 5th year onwards. When the pension is Rs.3,000/- per month, after deducting one-third as personal and living expenses, the contribution to the family will only to be Rs.2,000/- per month. Therefore, the loss of dependency cannot be taken as Rs.4,000/- per month for the entire period of 9 years representing the multiplier. It has to be taken as Rs.4,000/- per month for the first four years (when he would have been in service) and Rs.2,000/- per month for the remaining five years (when he would have received pension). The method adopted in the above illustration will have to be applied in this case.
17. In this case the deceased was aged 53 years at the time of death and she would have attained the age of superannuation in about 7 years. The multiplier period is 9 years. After 7 years, the income would not have been Rs.16,852.00 per month, but only roughly 50% of it as pension, and consequently the loss of dependency would have been 50% of Rs.1,20,000.00 per annum. Thus, loss of dependency will have to be calculated with reference to the salary income for a period of 7 years and pension income for the remaining period of 2 years, as the multiplier period is '9 years'. The loss of dependency would therefore be Rs.1,20,000.00 x 7 plus Rs.60,000.00 x 2 i.e., Rs.9,60,000.00.”
The Division Bench has also referred to the earlier judgments of the Hon’ble Supreme Court in the case of General Manager, Kerala S.R.T.C. V/s Susamma Thomas reported in AIR 1994 SC 1631 and the case of U.P. State Road Transport Corporation V/s Trilok Chandra and others reported in ILR 1996 KAR 2127, wherein the Davies method (Davies vs Powell Duffryn Associated Collieries Ltd.) (1942 AC 601) has been adopted in calculating general damages i.e. pecuniary loss suffered by the dependant members of the family on account of death of the deceased. This involved determining the total loss of dependency by multiplying the annual contribution to the family of the deceased, which is annual loss of deceased. The multiplier method involves the ascertainment of the loss of dependency or the multiplicand having regard to the circumstances of the case and capitalizing the multiplicand by an appropriate multiplier. 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 a capital sum, if invested at a rate of interest appropriate to a stable economy, would yield the multiplicand by way of annual interest. His Lordship thereafter as a Hon’ble Judge of the Supreme Court in the case of Sarla Verma and others vs. Delhi Transport Corporation Limited and another reported in (2009) 6 SCC 121 [Sarla Verma] in detail analyzed as to how the multiplier had to be chosen.
18. While considering the question as to whether the split multiplier formula was applicable to the facts of the case, reference has been made to a judgment of Hon’ble Supreme Court in Puttamma and others V/s K.L.Narayana Reddy reported in AIR 2014 SC 706, [Puttamma], wherein it has been held that the Hon’ble Supreme Court in Sarla Verma does not envisage application of split multiplier and that in the absence of any specific reason and evidence on record the Tribunal ought not to apply split multiplier in routine course and should apply multiplier as per decision of the Hon’ble Supreme Court in Sarla Verma as affirmed in Reshma Kumari and others v. Madan Mohan and another, (2013 ) 9 SCC 65, [Reshma Kumari].
19. The reason for the application of the split multiplier formula is that once the deceased would have retired from service on attaining the age of superannuation, his pension would not be equivalent to that of the salary income. His income would be in the nature of pension which would be only 50% of the salary that he would have received. Therefore, in the instant case, the Tribunal was right in applying the split multiplier formula. Further in the case of Sarla Verma, the discussion was more on the appropriate multiplier to be applied rather than as to whether a split multiplier formula was applicable. While answering Question No.3, their Lordships have discussed on the choice of the multiplier and analyzed as to how the appropriate multiplier ought to apply starting from ‘18’ for the death of a person between 15 to 20 years up to ‘5’ for death of a person aged about 65 years. In Paragraph 9, the Hon’ble Supreme Court has held as under:-
“9. Basically only three facts need to be established by the claimants for assessing compensation in the case of death : (a) age of the deceased; (b) income of the deceased; and the (c) the number of dependents. The issues to be determined by the Tribunal to arrive at the loss of dependency are (i) additions/deductions to be made for arriving at the income; (ii) the deduction to be made towards the personal living expenses of the deceased; and (iii) the multiplier to be applied with reference of the age of the deceased. If these determinants are standardised, there will be uniformity and consistency in the decisions. There will be lesser need for detailed evidence. It will also be easier for the insurance companies to settle accident claims without delay. To have uniformity and consistency, Tribunals should determine compensation in cases of death, by the following well settled steps:
Step 1 (Ascertaining the multiplicand):
The income of the deceased per annum should be determined. Out of the said income a deduction should be made in regard to the amount which the deceased would have spent on himself by way of personal and living expenses. The balance, which is considered to be the contribution to the dependant family, constitutes the multiplicand.
Step 2 (Ascertaining the multiplier) Having regard to the age of the deceased and period of active career, the appropriate multiplier should be selected. This does not mean ascertaining the number of years he would have lived or worked but for the accident. Having regard to several imponderables in life and economic factors, a Table of multipliers with reference to the age has been identified by this Court. The multiplier should be chosen from the said Table with reference to the age of the deceased.
Step 3 (Actual calculation):
The annual contribution to the family (multiplicand) when multiplied by such multiplier gives the `loss of dependency' to the family.
Thereafter, a conventional amount in the range of Rs.5,000 to Rs.10,000 may be added as loss to estate. Where the deceased is survived by his widow, another conventional amount in the range of Rs.5,000 to Rs.10,000 should be added under the head of loss of consortium. But no amount is to be awarded under the head of pain, suffering or hardship caused to the legal heirs of the deceased.
The funeral expenses, cost of transportation of the body (if incurred) and cost of any medical treatment of the deceased before death (if incurred) should also be added.
20. Thereafter there is a discussion on each of the aforesaid aspects namely, additions/deductions to be made for arriving at the income “deductions to be made towards personal living expenses of the deceased and the multiplier to be applied with reference to the age of the deceased.” With regard to the additions/deductions to be made after arriving at the income, it has been held that where the age of the deceased is more than 50 years, they should be no addition towards future prospects. Further, a standardization has been made with regard to the percentage of income to be deducted towards personal or living expenses of the deceased and a discussion is made on the appropriate multiplier to be applied having regard to the age of the deceased which has been referred to above.
21. The Hon’ble Supreme Court in the case of Puttamma at Paragraphs 32, 33 and 34 held as under on the issue of split multiplier.
“Split Multiplier 32. For determination of compensation in motor accident claims under Section 166 this Court always followed multiplier method. As there were inconsistencies in selection of multiplier, this Court in Sarla Verma prepared a table for selection of multiplier based on age group of the deceased/victim. Act, 1988 does not envisage application of split multiplier.
33. In K.R. Madhusudhan and others vs. Administrative Officer and another, (2011) 4 SCC 689 : AIR 2011 SC 979 : 2011 AIR SCW 1390), this Court held as follows:
“14. In the appeal which was filed by the appellants before the High Court, the High Court instead of maintaining the amount of compensation granted by the Tribunal, reduced the same. In doing so, the High Court had not given any reason. The High Court introduced the concept of split multiplier and departed from the multiplier used by the Tribunal without disclosing any reason therefor. The High Court has also not considered the clear and corroborative evidence about the prospect of future increment of the deceased. When the age of the deceased is between 51 and 55 years the multiplier is 11, which is specified in the 2nd column in the Second Schedule to the Motor Vehicles Act, and the Tribunal has not committed any error by accepting the said multiplier. This Court also fails to appreciate why the High Court chose to apply the multiplier of 6.
15. We are, thus, of the opinion that the judgment of the High Court deserves to be set aside, for, it is perverse and clearly contrary to the evidence on record, for having not considered the future prospects of the deceased and also for adopting a split multiplier method.”
34. We, therefore, hold that in absence of any specific reason and evidence on record the Tribunal or the Court should not apply split multiplier in routine course and should apply multiplier as per decision of this Court in the case of Sarla Verma (AIR 2009 SC 3104 : 2009 AIR SCW 4092) (supra) as affirmed in the case of Reshma Kumari (AIR 2013 SC (Civ) 1731: 2013 AIR SCW 3120) (supra). Compliance of Section 158(6) and 166(4) of the Act, 1988.”
22. In substance, the Hon’ble Supreme Court opined that in the absence of there being any specific reason and evidence on record the Tribunal should not apply split multiplier in routine course and should apply as per decision of the Hon’ble Supreme Court in the case of Sarla Verma as affirmed in the case of Reshma Kumari.
23. However, learned counsel for the claimants placed reliance on a judgment of the Hon’ble Supreme Court in the case of Puttamma wherein the Hon’ble Supreme Court has stated that there can be no routine application of split multiplier formula and that in the absence of any specific reason and evidence on record, the Court should not apply split multiplier in a routine course and that the multiplier may be applied as per the decision of the Supreme Court in the case of Sarla Verma.
24. In this regard, it is necessary to observe that deceased Smt.Pragati was the employee of a public sector organization viz., Bharat Sanchar Nigam Limited (BSNL). She would have retired on attaining the age of superannuation at 60 years. It has come in evidence that her pension would be 50% of her gross salary. The appropriate multiplier, having regard to the age of deceased is ‘11’. Therefore, the split multiplier formula would apply having regard to the dictum of the co-ordinate Bench of this Court in the case of K.S.Lakshmi Kumar referred to above, as in six years of the accident, she would have retired, had she lived till then, as her age was 54 years when she succumbed to the injuries sustained in the accident. Therefore, for the multiplier of ‘6’, 100% of the net salary must be taken into consideration and while applying the remaining multiplier of ‘5’, 50% of the net salary being the pension has to be taken into consideration. This is because, one cannot shy away from the fact that on retirement on attaining the age of superannuation, the pension is only 50% of the salary. Therefore, we assign the aforesaid reason as to why we have applied the split multiplier formula in the instant case and, therefore, we find that we are in compliance with the dictum of Hon’ble Supreme Court in Puttamma’s case also.
25. By applying split multiplier formula, compensation on the head of loss of dependency would be on the basis of net annual salary being Rs.9,81,134/- and the multiplier of ‘6’ is adopted in the first instance as the deceased would have retired in six years time but for the accidental death, i.e., Rs.9,81,134 X 6 = Rs.58,86,804/-. For the remaining multiplier of ‘5’, 50% of the net annual salary is reckoned which is, (Rs.9,81,134 / 2) X 5= Rs.24,52,835/-. Thus, total being Rs.83,39,639/- minus 1/3rd of the said amount towards personal expenses of the deceased, which would be Rs.55,59,759/- on the head of loss of dependency.
26. In addition, a sum of Rs.10,600/- is awarded by the Tribunal towards medical expenses. Since no amount is awarded towards incidental charges, a sum of Rs.30,000/- is awarded on the said head. A sum of Rs.40,000/- is awarded towards loss of consortium to the husband of the deceased and Rs.30,000/- towards loss of parental consortium, having regard to the latest dictum of the Hon’ble Supreme Court in the case of Nanu Ram alias Chuhru vs. Magma General Insurance Co. Ltd., reported in 2018 ACJ 2782. Further a sum of Rs.15,000/- is awarded towards loss of estate and a sum of Rs.15,000/- towards transportation of the dead body and funeral expenses. The same is as per the following table:
Loss of dependency -Rs. 55,59,759/-
Total : Rs.57,00,359/-
Thus, a total compensation of Rs.57,00,359/- is awarded. The said compensation shall carry interest @ 6% per annum from the date of claim petition till realization. Thus, the enhanced compensation is Rs.57,00,359/- minus Rs.53,31,024/-, which comes to Rs.3,69,335/-.
The enhanced compensation along with interest @ 6% p.a. shall be equally apportioned between the claimants.
The appeal filed by the claimants is allowed in-part in the aforesaid terms.
Despite taking into consideration the contentions of the Insurance Company on the split multiplier formula, the appeal filed by the Insurance Company is dismissed as the overall compensation is enhanced by Rs.3,69,335/-.
Parties to bear their respective costs.
The amount in deposit before this Court be transmitted to the Tribunal.
Sd/- JUDGE Sd/- JUDGE mv