HDFC ERGO General Insurance Company Ltd. having office at Metro v. Pushpa Devi Agarwal

Judgment

1. Heard the parties.

2. This appeal has been preferred by the appellant-insurance company against the judgment and award dated 25.02.2013 passed by the Principal District Judge-cum-Motor Vehicle Accident Claim Tribunal, Bokaro in T.M.V. Claim Case No.25 of 2011 whereby and whereunder the learned Tribunal in an application under Section 166 of Motor Vehicles Act has awarded a compensation of Rs.54,41,830/- along with simple interest thereon at the rate of 9% per annum on the compensation amount to only the claimant no.1 who is the widow of the deceased.

3. The brief facts of the case is that on 01.11.2010, while the 2 M.A. No. 108 of 2013 deceased – Satyanarayan Agarwal was coming in a car, the offending TATA Sumo vehicle being rashly and negligently driven dashed the vehicle of the deceased by which the deceased – Satyanarayan Agarwal sustained multiple brain injuries and he succumbed to the injuries within 42 hours of the accident. The deceased –Satyanarayan Agarwal was aged 70 years at the time of his death and was the founder of three industries in India. The deceased was the Managing Director of M/s Ashoka Foundry & Equipment Pvt. Ltd. and a winner of various national and international awards. The deceased developed various import substitute items for the country and he was an employer of 1,000 workers and had a monthly income of Rs.2,03,751/- and paid the income tax of Rs.6,17,775/- for the year 2009-2010 admittedly. His death has affected the out turn of the company and turnover has been reduced from 6.91 crores to 4.14 crores.

4. In their written statement, the appellant-insurance company admitted that the TATA Sumo vehicle was under its insurance coverage vide the relevant policy. It was contended by the appellant insurance company that the driver of the offending vehicle was not having a valid license at the time of accident and he was driving the offending vehicle under influence of liquor which was in violation of terms and conditions of the insurance policy.

5. The learned tribunal on the rival pleadings of the parties framed the following three issue: (I) Whether the claim petition as framed and maintainable? (II) Whether the deceased –Satyanarayan Agarwal died

03.11.2010 during the course of his treatment at B.G.H., Bokaro, 3 M.A. No. 108 of 2013 resulted from an accident caused by rash and negligent driving of the driver of the TATA Sumo Vehicle bearing registration no. JH- 09M-4926 at 05:45 P.M. on 01.11.2010 near Ritudih, P.S. – Marafari, District – Bokaro? (III) To what amount of compensation, the claimants are entitled to and from whom?

6. In support of their contention three witnesses were examined on behalf of the claimants and the claimants also proved the documents which were marked Ext. 1 to 12.

7. In respect of contention of the appellant regarding the pleadings in the written statement that the driver of the offending vehicle was under drunken state, the learned tribunal considered that the appellant-insurance company has not led any evidence whatsoever, to substantiate its pleading that the driver of the offending vehicle was in a drunken state. Similarly, the appellant- insurance company did not lead any evidence to substantiate its pleading that the driver of the offending vehicle was not having a valid driving license and the burden was upon the appellant- insurance company to prove its own pleadings and yet the appellant- insurance company chose not to adduce any evidence whatsoever, so the learned tribunal did not consider these two contentions of the appellant-insurance company having not been established, discarded such contentions.

8. On the basis of the evidence in the record, the learned tribunal

answered the issue no. I in affirmative. In respect of issue no. II, the learned tribunal considering the oral testimony of the witnesses examined by the claimant and considering that no question was put in 4 M.A. No. 108 of 2013 the cross-examination of the C.W.2-the eye witness of the occurrence, regarding the manner of accident, answered the issue no. II in affirmative in favour of the claimants. So far as the issue no. III is concerned, the learned tribunal considered that a sum of Rs.4,41,830/- was incurred in the treatment of the deceased before his death.

9. The learned tribunal took note of the fact that Ext.7, which is the photocopy of the income-tax return of the assessment year 2010-2011 shows that the deceased earned a gross total income of Rs.24,45,020/- and paid the tax of Rs.6,18,015/-. Therefore, the learned tribunal assessed the net annual income of the deceased to be Rs.18,27,005/-. Considering the age of the deceased to be 70 years, the multiplier of 5 was applied as per the ratio of the Judgment of Hon’ble Supreme Court of India, in the case of SarlaVerma (SMT) And Others v. Delhi Transport Corporation And Another reported in (2009) 6 SCC 121 and one-third of the income of the deceased was deducted towards his personal income and though as per the multiplier method, the compensation amount worked out to Rs.60,90,016/- but the learned tribunal awarded a lump sum compensation of Rs.50,00,000/- on account of death of the deceased and another Rs.4,41,830/- towards the medical expenses incurred in treatment of the deceased before his death and thus in total awarded Rs.54,81,430/-.

10. Mr. Piyush Krishna Choudhary, the learned counsel for the appellant submits that the learned tribunal failed to consider the evidence in the record in its proper perspective and also failed to take into consideration that the driver of the offending vehicle was in a drunken state, hence the insurance company would not have been saddled with the liability to pay the compensation amount. It is next 5 M.A. No. 108 of 2013 submitted that the appellant-insurance company has been prejudiced because of non-examination of the claimant no.1. It is then submitted that the learned tribunal failed to consider that the claimant no.1 is not the dependent of the deceased as she was working as the Managing Director of the firm after the death of her husband. It is next submitted that the learned tribunal also failed to consider that the driver of the offending vehicle was not having a valid professional driving license to drive Sports Utility Vehicle (SUV). It is then submitted that the learned tribunal also failed to consider the principle of law settled by the Hon’ble Supreme Court of India, in the case of The Managing Director, TNSTC Ltd. Vs. K.I. Bindu and Ors., reported in (2005) 8 SCC 473. Mr. Piyush Krishna Choudhary also relied upon the Judgment of Hon’ble Supreme Court of India, in the case of Divisional Controller, KSRTC vs. Mahadeva Shetty and Anr., reported in (2003) 7 SCC 197 and the Judgment of Hon’ble Supreme Court of India, in the case of Gujarat State Road Transportation Vs. Ramanbhai Prabhatbhai & Another, reported in 1987 AIR SC 1690. Mr. Choudhary then relied upon the Judgment of Hon’ble Supreme Court of India, in the case of U.P. State Road Transport Corporation & Ors. Vs. Trilok Chandra & Others, reported in (1996) 4 SCC 362. Lastly, it is submitted by Mr. Piyush Krishna Choudhary, that the impugned judgment and award be set aside and the appellant-insurance company be absolved of the liability to pay the compensation amount.

11. Mr. Mukesh Kumar, the learned counsel for the respondent no.1, Mr. D.K. Chakraverty, the learned counsel for the respondent no.2 and Mrs. Vandana Singh, the learned counsel for the respondent no.4 on the other hand defended the impugned judgment and award and 6 M.A. No. 108 of 2013 submitted that the learned tribunal has rightly held that the appellant- insurance company has failed to establish its contention that the driver of the offending vehicle was under a drunken state at the time of the accident or for that matter, the driver of the offending vehicle was not having a valid license. It is further submitted by them that the learned tribunal has rightly assessed the quantum of compensation, keeping in view the fact that a commercial enterprises of which the deceased was the founder was dependent upon the managerial skill of the deceased as any industry is not run only by money and machine but human skill and inputs are major components to run it and even though the respondent no.1 has succeeded the deceased as Managing Director of the firm of which the deceased was the Managing Director, it cannot be denied that the turnover of the company has been reduced to 6.91 crores to 4.14 crores speaks volumes about the contribution of the deceased for the company. Hence, it is submitted that the amount of compensation has rightly been awarded to the claimant-respondent no.1 of this appeal.

12. Having heard the rival submissions made at the bar and after going through the materials in the record, the following points for determination crop up in this appeal for consideration: (i) Whether the learned tribunal was right in awarding the compensation amount to the claimant no.1? (ii) Whether the learned tribunal has rightly come to the conclusion that the insurance company has failed to establish that the driver of the offending vehicle was in a drunken state and he was not having a valid license.

13. Now, so far as the Judgment of Hon’ble Supreme Court of India, in the case of The Managing Director, TNSTC Ltd. Vs. K.I. Bindu and Ors., reported in (2005) 8 SCC 473, paragraph nos. 9 & 18 of which 7 M.A. No. 108 of 2013 reads as under :- “9. The measure of damage is the pecuniary loss suffered and is likely to be suffered by each dependant. Thus, “except where there is express statutory direction to the contrary, the damages to be awarded to a dependant of a deceased person under the Fatal Accidents Acts must take into account any pecuniary benefit accruing to that dependant in consequence of the death of the deceased. It is the net loss on balance which constitutes the measure of damages.” Lord Wright in Davies case said: “The actual pecuniary loss of each individual entitled to sue can only be ascertained by balancing on the one hand the loss to him of the future pecuniary benefit, and on the other any pecuniary advantage which from whatever source comes to him by reason of the death.” These words of Lord Wright were adopted as the principle applicable also under the Indian Act in Gobald Motor Service Ltd. v. R.M.K. Veluswami where this Court stated that the general principle is that the actual pecuniary loss can be ascertained only by balancing on the one hand the loss to the claimant of the future pecuniary benefit and on the other any pecuniary advantage which from whatever sources comes to them by reason of the death, that is, the balance of loss and gain to a dependant by the death, must be ascertained. reckoner. However,

18. In fact in Trilok Chandra case after reference to the Second Schedule to the Act, it was noticed that the same suffers from many defects. It was pointed out that the same is to serve as a guide, but cannot be said to be an invariable the appropriate highest multiplier was held to be 18. The highest multiplier has to be for the age group of 21 to 25 years when an ordinary Indian citizen starts independently earning and the lowest would be in respect of a person in the age group of 60 to 70, which is the normal retirement age. (Emphasis supplied) It has been observed by the Supreme Court in the said judgment that the general principle is that the actual pecuniary loss can be ascertained only by balancing on the one hand the loss to the claimant of the future pecuniary benefit and on the other any pecuniary advantage which from whatever sources comes to them by 8 M.A. No. 108 of 2013 reason of the death. From this it is crystal clear that the compensation amount to be awarded must take into account any loss of pecuniary benefit accruing to the dependent in consequence to the death of the deceased. In the case of U.P. State Road Transportation & Ors. Vs. Trilok Chandra & Others, reported in (1996) 4 SCC 362, the Hon’ble Supreme Court of India reiterated the principle on which amount the plan method was developed by observing as under in paragraph nos. 15 & 16: “15. We thought it necessary to reiterate the method of working out ‘just’ compensation because, of late, we have noticed from the awards made by tribunals and courts that the principle on which the multiplier method was developed has been lost sight of and once again a hybrid method based on the subjectivity of the Tribunal/Court has surfaced, introducing uncertainty and lack of reasonable uniformity in the matter of determination of compensation. It must be realised that the Tribunal/Court has to determine a fair amount of compensation awardable to the victim of an accident which must be proportionate to the injury caused. The two English decisions to which we have referred earlier provide the guidelines for assessing the loss occasioned to the victims. Under the formula advocated by Lord Wright in Davies, the loss has to be ascertained by first determining the monthly income of the deceased, then deducting therefrom the amount spent on the deceased, and thus assessing the loss to the dependants of the deceased. The annual dependency assessed in this manner is then to be multiplied by the use of an appropriate multiplier. Let us illustrate: X, male, aged about 35 years, dies in an accident. He leaves behind his widow and 3 minor children. His monthly income was Rs 3500. First, deduct the amount spent on X every month. The rough and ready method hitherto adopted where no definite evidence was forthcoming, was to break up the family into units, taking two units for an adult and one unit for a minor. Thus X and his wife make 2+2=4 units and each minor one unit i.e. 3 units in all, totalling 7 units. Thus the share per unit works out to Rs 3500/7=Rs 500 per month. It can thus be assumed that Rs 1000 was spent on X. Since he was a working member some provision for his transport and out- of-pocket expenses has to be estimated. In the present case we estimate the out-of-pocket expense at Rs 250. Thus the amount spent on the deceased X works out to Rs 1250 per 9 M.A. No. 108 of 2013 month leaving a balance of Rs 3500-1250=Rs 2250 per month. This amount can be taken as the monthly loss to X’s dependants. The annual dependency comes to Rs 2250 (cid:215) 12=Rs 27,000. This annual dependency has to be multiplied by the use of an appropriate multiplier to assess the compensation under the head of loss to the dependants. Take the appropriate multiplier to be 15. The compensation comes to Rs 27,000 (cid:215) 15=Rs 4,05,000. To this may be added a conventional amount by way of loss of expectation of life. Earlier this conventional amount was pegged down to Rs 3000 but now having regard to the fall in the value of the rupee, it can be raised to a figure of not more than Rs 10,000. Thus the total comes to Rs 4,05,000+10,000= Rs 4,15,000.

16. In the method adopted by Viscount Simon in the case of Nance also, first the annual dependency is worked out and then multiplied by the estimated useful life of the deceased. This is generally determined on the basis of longevity. But then, proper discounting on various factors having a bearing on the uncertainties of life, such as, premature death of the deceased or the dependant, remarriage, accelerated payment and increased earning by wise and prudent investments, etc., would become necessary. It was generally felt that discounting on various imponderables made assessment of compensation rather complicated and cumbersome and very often as a rough and ready measure, one-third to one-half of the dependency was reduced, depending on the life span taken. That is the reason why courts in India as well as England preferred the Davies formula as being simple and more realistic. However, as observed earlier and as pointed out in Susamma Thomas case, usually English courts rarely exceed 16 as the multiplier. Courts in India too followed the same pattern till recently when tribunals/courts began to use a hybrid method of using Nance method without making deduction (Emphasis supplied) imponderables.” Further, in the case of Divisional Controller, KSRTC vs. Mahadeva Shetty and Anr., reported in (2003) 7 SCC 197, Hon’ble Supreme Court of India reiterated the principle that the object of providing compensation is to place the claimant as far as possible in the same position financially as he was before the accident by observing thus in paragraph no.12: “12. It is true that perfect compensation is hardly possible and money cannot renew a physique or frame that has been 10 M.A. No. 108 of 2013 battered and shattered, as stated by Lord Morris in West v. Shephard. Justice requires that it should be equal in value, although not alike in kind. The object of providing compensation is to place the claimant as far as possible in the same position financially as he was before the accident. Broadly speaking, in the case of death the basis of loss of pecuniary benefits to the compensation dependants of the deceased which includes pecuniary loss, expenses etc. and loss to the estate. The object is to mitigate hardship that has been caused to the legal representatives due to the sudden demise of the deceased in the accident. Compensation awarded should not be inadequate and should neither be unreasonable, excessive, nor deficient. There can be no exact uniform rule for measuring the value of human life and the measure of damage cannot be arrived at by precise mathematical calculation; but amount recoverable depends on broad facts and circumstances of each case. It should neither be punitive against whom claim is decreed nor should it be a source of profit for the person in whose favour it is awarded. Upjohn, L.J. in Charterhouse Credit v. Tolly remarked, “the assessment of damages has never been an exact science; it is essentially practical” (All ER p. 443 C).” (Emphasis supplied) The case of Gujarat State Road Transportation Vs. Ramanbhai Prabhatbhai & Another, reported in 1987 AIR SC 1690, relates to the claim of compensation under section 110-A of the Motor Vehicles Act, 1939, hence the same are not relevant to this case where the compensation has been sought under section 166 of the Motor Vehicles Act, 1988.

14. It is pertinent to mention here that Section 166 of the Motor Vehicles Act, 1988 lays down the category of persons who can apply for compensation. It categorizes the legal representatives in case of death and it is important to note that the Section nowhere uses the word “dependent”. So the natural corollary is that when a person is the legal representative, he can be the claimant. Section 2 (11) of the Code of Civil Procedure lays down the meaning of the word “legal representative” and the meaning of the word “legal representative” laid down in the Court of Civil Procedure can be borrowed while interpreting the 11 M.A. No. 108 of 2013 provisions of Motor Vehicles Act, 1988 as has been held by the Hon’ble Supreme Court of India in the case of Manjuri Bera vs. Oriental Insurance Company Ltd. & Anr., reported in (2007) 10 SCC 643 and in the case of Gujarat State Road Transportation Vs. Ramanbhai Prabhatbhai & Another (supra), widow is certainly the Class-I heir to whom the property of a deceased Hindu husband devolves as per the intestate succession. It has been judicially recognized that the following factors (a) age of the deceased, (b) income of the deceased, and (c) number of dependents, are to be considered while fixing the quantum of compensation in case of death arising out of motor vehicle accident. The Hon’ble Supreme Court of India in order to have the uniformity has laid down some guidelines, how to calculate contribution to personal expenses and contribution towards dependents. These guidelines are not mandatory. The Hon’ble Supreme Court of India in the case of Manjuri Bera vs. Oriental Insurance Company Ltd. (supra) held that even married daughter residing with husband though not dependent on the income of the father being legal representative is entitled to claim compensation under Section 140 of the Motor Vehicles Act. In the case of Gujrat State Road Transportation Vs. Ramanbhai Prabhatbhai & Another (supra), the Hon’ble Supreme Court of India recognized the right of a brother to claim compensation if he is the legal representative of the deceased and in that case, the Hon’ble Supreme Court of India compared the provisions of Fatal Accidents Act, 1855 and the Motor Vehicles Act, 1939. So only because the claimant-respondent no.1 has stepped into the shoes 12 M.A. No. 108 of 2013 of her husband as Managing Director, in the considered view of this Court, she cannot be deprived of the compensation amount, more so because on the date of death of the deceased she was not the Managing Director rather she will fully dependent upon the deceased. It is crystal clear from the evidence of the A.W.1 that the turnover of the company has come down from 6.9 crores to 4.3 crores in the absence of the deceased and this portion of the testimony of the A.W.1 has remained unchallenged in his cross-examination, hence the same is to be accepted as true. Similarly, though A.W.2 in para -13(a) and A.W.3 is para -12 (ka) has stated about these facts and the same has remained unchallenged in their respective cross-examination.

15. Under such circumstances, this Court is of the considered view that the amount of compensation awarded by the tribunal is just compensation and the same do not warrants interference of this Court in exercise of its appellate jurisdiction. The first point for determination is answered accordingly.

16. So far as the second point for determination regarding the conclusion arrived at by the learned tribunal regarding failure of the appellant-insurance company to establish that the driver of the offending vehicle was under drunken state or for that matter he was not having a valid driving license is concerned, it is a settled principle of law that the person who pleads the fact has to prove it and undisputedly, the appellant-insurance company chose not to put any question regarding their pleading to the witnesses of the claimants including the witness who is an eye-witness to the occurrence nor chose to adduce any evidence in support of its contention made in its pleading. Under such circumstances, this Court also do not finds any error on the part of the 13 M.A. No. 108 of 2013 learned tribunal in arriving at the conclusion that the appellant- insurance company failed to prove the said facts. The second point for determination is answered accordingly.

17. In view of the answer to the above mentioned two points for determination, this Court is of the considered view that there is no merit in this appeal.

18. Accordingly, this appeal is dismissed but under circumstances without any costs.

19. It is submitted that in compliance of the order dated 09.07.2014, Rs.30,00,000/- has been deposited by the appellant-insurance company with the Registrar General of the Court as well as statutory amount of Rs.25,000/- has also been deposited.

19. The Registrar General of this Court is directed to remit Rs.30,00,000/-, which was deposited with this Court in compliance of the order dated order dated 09.07.2014 as well as Rs.25,000/-, if any, deposited towards statutory amount in connection with this appeal by the appellant, to the concerned tribunal through appropriate mode forthwith.

20. Let a copy of this Judgment along with Lower Court Records be sent back to the learned tribunal forthwith. High Court of Jharkhand, Ranchi Dated the 11th July, 2022 AFR/ Sonu-Gunjan/- (Anil Kumar Choudhary, J.)