R.K. MAUK & Anr. v. KIRAN PAL & Ors.

,., I . - ,. ,,. ,. ). [2009] 10 S.C.R. 87 R.K. MAUK AND ANR. v. KIRAN PAL AND ORS. (Civil Appeal No. 3608 of 2009) ' MAY 15, 2009 A B [S.B. SINHA AND DR. MUKUNDAKAM SHARMA, JJ.] Motor Vehicles Act, 1988 - ss. 163A and 166 rlw 168; Second Schedule - Bus carrying school children met with accident and fell into river from bridge - Death of 29 children c - Most of them were in the age group of 10 to 18 years - Claim for compensation by parents of deceased children - Courts below awarded pecuniary compensation, on basis of Second Schedule and relevant multiplier under the Act, which in majority of the casAs ranged from Rs. 1, 55, 0001- to D Rs.1,65,0001- - Though Tribunal did not award any non- pecuniary compensation, the High Court awarded non- pecuniary damages of Rs. 75, 0001- - On appeal, held: Pecuniary damages seeks to compensate losses which_ can be translated into money terms like loss of earnings, actual E and prospective earning and other out of pocket expenses - On facts, no reason to differ with Courts below in respect of award of pecuniary compensation - As regards non-pecuniary damages, the same include immeasurable elements such as pain, suffering, loss of amenity and enjoyment of life and on F facts, High Court rightly enhanced compensation in this category by Rs.

75,0001- - However, compensation must also be granted with regard to future prospects of the children, which aspect was overlooked by both the Courts below - The records showed that the children were good in studies and studying in a reasonably good school and naturally, their future prospect was presumably good and bright and hence, it would be appropriate to grant further amount of Rs. 75, 0001 - (which is roughly half the pecuniary compensation) as G 87 - • 88 SUPREME COURT REPORTS [2009] 10 S.C.R. ~ compensation for future prospects of the children. A bus carrying school children met with accident and fell into tihe Yamuna river from the bridge. Consequent to the accident, 29 children died. The parents of the deceased children i.e. the appellants filed claim petitions on account of fault liability and sought for payment of compensation under section 163A r/w Second Schedule of the Motor Vehicles Act, 1988.

3 The Motor Accident Claims Tribunal held that the ~ _, accident took place due to negligence of the driver (respondent no.1) and, therefore, he alongwith the owner and the insurer (respondent nos.2 and 3) were jointly and severally liable to pay compensation and thereafter awarded a sum of Rs.1,55,000/- in case of children J between age group of 10 to 15 years and Rs.1,65,000/- in case of children between 15 to 18 years. In case of children aged less than 10 years, Rs.1,05,000/- was awarded in one case and in two other cases Rs.1,30,000/ - and Rs!.1,31,000/- respectively was awarded. Additional E Rs.1,000/- was awarded in case of the third child aged less than 10 years, as in some other cases, for loss of books. Tile compensation figure included Rs. 5,000/- each towards funeral and last rites. As per the Second Schedule of the Act, the balance amount was awarded for loss of dependency that was calculated on notional income of Rs.

15,000/- per annum of which Rs. 5,000/ was deducted towards personal living expenses. The Tribunal applied multiplier of 15 for children below 15 years and multiplier of 16 for children between 16 and 18 G years respectively. It awarded interest @ 6% for four F years. On appeal, the High Court, by the impugned judgment, held that the appellants were entitled to enhancement of compensation in all the cases by H Rs.75,000/- and Rs.1000/- (if not already awarded by the R.K. MALIK AND ANR. v. KIRAN PAL AND ORS. 89 ... Tribunal) and interest@ 7.5% p.a. from the date of filing A of the claim petition till payment. """"- Disposing of the appeals, the Court HELD: 1.

Compensation in law is paid to restore the person, who has suffered damage or loss in the same B position, if the tortuous act or the breach of contract had not been committed. The law requires that the party suffering should be put in the same position, if the contract had been performed or the wrong had not been committed. The law in all such matters requires payment C of adequate, compensation. [Para 10) [99-F-G] reasonable and • just monetary

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In cases of motor accidents the endeavour is to put the dependents/claimants in the pre-accidental 0 position. Compensation in cases of motor accidents, as in other matters, is paid for reparation of damages. The damages so awarded should be adequate sum of money that would put the party, who has suffered, in the same position if he had not suffered on account of the wrong. E Compensation is therefore required to be paid for prospective pecuniary loss i.e. future loss of income/ dependency suffered on account of the wrongful act. [Para 11) [99-H; 100-A-B)

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However, no amount of compensation can F restore the lost limb or the experience of pain and suffering due to loss of life. Loss of a child, life or a limb can never be eliminated or ameliorated completely. Pecuniary damages cannot replace a human life or limb lost. Therefore, in addition to the pecuniary losses, the G law recognises that payment should also be made for non pecuniary losses on account of, loss of happiness, pain, suffering and expectancy of life etc. The Motor Vehicles Act, 1988 provides for payment of "just compensation" vide section 166 and 168. It is left to the H 90 SUPREME COURT REPORTS (2009) 10 S.C.R. A courts to decide what would be "just compensation" in facts of a case. [Para 12] [100-B-D]

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For calculating pecuniary loss or loss of dependency, it is the multiplier method which should be B applied. The said method is based upon the principle that the claimant must be paid a capital sum, which would yield sufficient interest to provide material benefits of the same standard and duration as the deceased would have provided for the dependents, if the deceased had lived c and earned. The multiplier method is based upon the assessment that yearly loss of dependency should be eq1,1al to interest that could be earned in normal course on the capital sum invested. The capital sum would be the compensation for loss of dependency or the pecuniary loss suffered by the dependents. Uniform application of the multiplier method ensures consistency and certainty and prevents different amounts being awarded in different cases. [Para 13] [100-D-G] D

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For calculating the yearly loss of dependency the E sta1rting point is the wages being earned by the deceased, less his personal and living expenses. This provides a basic figure. Thereafter, effect is given to the future prospects of the deceased, inflation and general price rise that erodes value and the purchasing power of money. F To the multiplicand so calculated, multiplier is to be applied. The multiplier is decided and determined on the basis of length of dependency, which must be estimated. This tras to be necessarily discounted for contingencies and uncertainties. [Para 14] [100-H; 101-A-B] G