NATIONAL INSURANCE CO. LTD . .. v. . ·GURUMALLAMMA & ANR.

p. 298 Copy page pinpoint

... A (ClVil Appeal No. 4644 of 2009) . . .. JULY 23, 2009 B [S.B. SINHA AND CYRIAC JOSEPH, JJ;]

Ori account of fatal accident of a 22 year old boy, his mother (respondent-claimant), aged 55 years, filed a . petition uls. 163A of Motor Vehicles Act, 1988. F · The question for consideration in the present appeal · was whether Second Schedule appended to the Act was applicable in the facts of the case.

G Partly allowing the appeal, the Court

NATIONAL. INSURANCE CO. LTD. v. 299 - GURUMALLAMMA & ANR.

..,,.. deceased who died in use of a motor vehicle. It contains A a non-obstante clause. It makes the owner of a motor vehicle or the authorized insurer liable to pay in the case of death, the amount of compensation as indicated in the Second Schedule to his legal heirs. The Second Schedule provides for the amount of compensation for B third party Fatal Accident/Injury Cases Claims. It provides for the .age of the victim and also provides for the multiplier for arriving at the amount of compensation which became payable to the heirs and legal representatives of the deceased depending upon his c annual income. The Second Schedule furthermore

- provides that in a case of fatal accident, the amount of claim shall be reduced by 1/3rd in consideration of the expenses which the victim would have incurred upon himself, had he been alive. It provides for the amount of 0 minimum compensation of Rs.50,000/-. It furthermore provides for payment of general damages as specified in Note 3 thereof. [Para 7] [302-D-G] _

2Copy pinpoint2. Multiplier stricto sensu is not applicable in the case of fatal accident. The multiplier would be applicable only in case of disability in non-fatal accidents as would appear from Note 5 appended to the Second Schedule. Thus, even if the application of multiplier is ignored in the ~ -

- ... present case and the income of the deceased is taken to be Rs'.3,~00/- per month, the amount of compensation payable would be somewhat between 6,84,000/- to Rs.7 ,60,000/-. As the Second Schedule provides for a structured formula, the question of determination of payment of compensation by application of judicial mind which is otherwise necessary for a proceeding arising out of a claim petition filed u/s. 166 would not arise. The . Tribunals in a proceeding u/s. 163A of the Act is required to determine the amount of compensation as specified in the Second Schedule. It is not required to apply the H

300 SUPREME I COURT REPORTS [2009] 11 S.C.R.

A multiplier except in a case of injuries and disabilities. [Para BJ (302-H; 303-A..:C]

3Copy pinpoint3. The Parliament in laying down the amount of compensation in the Second Schedule, in its wisdom, provided for payment of some amount which should be 8 treated to be the minimum. It took into consideration the fact that a person's potentiality to earn_ is highest, when he ··Is aged between 25 and 30 years and that is why in case of permanent disability multiplier of 18 has been ~ C specified. [Para 9J [303-0-E]

4Copy pinpoint4. The deceased was running a hotel. He was, therefore, having some income. No document, however, was produce.d in support of the statement of the claimant {the .mother of the deceased) that his income was 3,300/ D - per month. On what basis such a claim was made has not been disclosed. No document was produced. The deceased was not an income tax payee. Income of Rs.3,300/- might have been chosen so as not to cross the deadline of income of Rs.40,000/- per annum. Although E both the Tribunal as also the High Court has accepted the same, the income of the deceased should be determined at Rs.24,000/- per annum. Applying the said principle, the claimant would have been entitled to a compensation of Rs.4,22,000/-. From that sum, one-third should be F deducted. [Paras 10 and 11] [303-G-H; 304-A-B] ,

5Copy pinpoint5. In a case of death of an unmarried person and wherein the claimants are the parents of the deceased, the age of the deceased shall be irrelevant factor for applying the multiplier specified in the Second Schedule. G [Para 12] [304-C-D]

CIVIL APPELLATE JURISDICTION : Civil Appeal No. -..., 4644 of 2009.

NATIONAL INSURANCE CO. LTD. v. 301 GURUMALLAMMA & ANR. -~

From the Judgment & Order dated 19.11.2007 of the High A Court of Karnataka at Bangalore in M.F.A. No. 6627 of 2007 (MV).

Meenakshi Midha and B.K. Satija for the Appellants.

N_andkishor, N.R. Verma and Anjana Chandrashekarfor B the Respondents.

~ The Judgment of the Court was delivered by

5.8. SINHA, J. 1. Le~ve granted. c

2. Application of the SecQnd Schedule appended to the Motor Vehicles Act, 1988 (the Act) in the facts and circumstances of this case is involved in this appeal which arises out of a judgment and order dated 19.11.2007 passed .,, by a Division Bench of the High Court of Karnataka at D y Bangalore in MFA No.6627 of 2007 dismissing the appeal preferred by the appellant insurance company from a judgment and award dated 29.11.2006 passed in MVC No.982 of 2006 by the 16th Additional Judge, MACT, Bangalore, awarding compensation for a sum of Rs.4,78,300/- by way of compensation.

3. Indisputably, one Nag raj, predecessor-in-interest of the • responden,, died in an accident which took place on 14.12.2005. The deceased was travelling in an auto rickshaw bearing registration No.KA-05-A/4240. It collided with a car, bearing Registration No.KA-02-N/4605.

4. An application under Section 163A of the Act was filed. The deceased, at the time of accident, was aged about 22 years; whereas the age of the claimant was 50 years. The G ,.c----( learned Tribunal as also the High Court, in determining the amount of compensation, applied the multiplier of 17.

5. Ms. Meenakshi Midha, learned counsel appearing on behalf of the appellant, would submit that the learned Tribunal H

302 SUPREME COURT REPORTS [2009] 11 S.C.R.

A as also the High Court committed a serious error in passing the impugned judgment insofar as they failed to take into consideration the fact that keeping in view the age ,of the claimant, the multiplier of 13 should have been applied. It was furthermore contended that no proof of income of the deceased s having been brought on record, the Tribunal as also the High Court committed a serious error in holding that his income was Rs.3,300/- per month.

· 6. The deceased was a bachelor. He ·was running a small hotel. Although there is some dispute in regard to the nature of C the<claim petition, the learned Tribunal as, also the High Court having proceeded oil the basis that the same was fried in terms . of Section 163A of the Act, we see no reason to take a different view.

7Copy pinpoint7. Section 163A was inserted by Act No.54 of 1994 as a special measure to ameliorate the difficulties of the family members ofa deceased who died in use of a motor vehicle. It contains a· non"'obstante clause. It make~ the owner ofa motor vehicle or the authorized insurer liable to. pay in the case of death, the a'nlo.µnt of compensation as indicated in the Second Schedule to his legal heirs. The Second Schedule provides for the amount of compensatbn for third party Fatal Accident/Injury · Cases Claims. It providetI for the age of the victim.. and also provides for the multiplier for arriving at the amount of compensation which became payable to. the heirs and legal representatives of the deceased depending upon his annual income. The Second Schedule furthermore provides that in a case of fatal accident, the amount of claim.shall be reduced by 1/3rd in consideration of the expenses which the victinJ would· have incurred upon himself; had he been ·alive. It provides for . G the amount of minjmum compensation" of Rs,50,000/- .. It furthermore provides for payment of general damages as · specified in Note 3 thereof.

8Copy pinpoint8. Multiplier stricto sensu is not app.litable in the case ()f H fatal accident. The multiplier would be applicable only in case

NATIONAL INSURANCE CO. LTD. v. 303 GURUMALLAMMA & ANR [S.B. SINHA, J.] I

of disability in non".'fatal accidents as would appear from the' A ~

Note 5 appended to the Second Schedule. Thus, even if the application of multiplier is ignored in the ·present case and the income of the deceased is taken to be Rs.3,300/- per month, the amount of compensation payable would be somewhat between 6,84,000/- to Rs.7,60,000/-. As the Second Schedule B provides for a structured formula, the question of determination· of payment of compensation by application of judicial mind which is otherwise necessary for a proceeding arising out of a .... claim petition filed under Section 166 would not '~rise. The Tribunals in a proceeding under Section 163A of the Act is 1 c required to determine the amount of compensation as specified in the Second Schedule. It is not required to apply the multiplier except in a case of injuries and disabilities.

9Copy pinpoint9. The Parliament in laying down the amount o~ ., compensation in the Second Schedule, as indicated D y hereinbefore, in its wisdom, provided for payment of some amount which should be treated to be the minimum. It took into consideration the fact that a person's potentiality to earn is highest when he is aged between 25 and 30 years and that is why in case of permanent disability multiplier of 18 has been E .specified. The very fact that even if the deceased had ari ·income of Rs.3,000/- per month, he being aged about 15 years .· woµld receive a sum of Rs.60,000/-' but if his. income was HsA0,000/:. per annum, hi.s legal heirs and representatives would receive_ a sum of Rs.8,00,000/-, In t_he case of any non+- F earning person, the notional income ha.s been fixed at Rs.15,000/- per onnum.

10Copy pinpoint10. The deceased was running a hotel. He was, therefore, . .having some 'income. No document, however, was produced .G in support of the statement of the claimant (tl)e mother of the ~~ deceased) that his income was 3,300/- per month. On what basis such a claim was made has not been disclosed. No document was produced. The deceased was not an income tax payee. Income of Rs.3,300/- might have been chosen so H

304 SUPR~ME COURT REPORlS [2009] 11 8.C.Ft '

A as not to cross the deadline of income of Rs.40,000/.. per annum.

11Copy pinpoint11. Although both the Tribunal as also the High Court has accepted the same, in our opinion, the income of the deceased 8 should be determined at Rs.24,000/- pet annum. Applying the said principle, the claimant would have been entitled to a compensation of Rs.4,22,000/-. From that sum; one-third should be deducted. ) '

12Copy pinpoint12. In view of the aforementioned finding, we are of the / C opinion that it is not necessary for us to take into consideration, the decisions cited at the bar suggesting that in a case of death of an unmarried person and wherein the claimants are the parents of the deceased, the age of the deceased shall be irrelevant factor for applying the multiplier specified in the D Second Schedule.

13Copy pinpoint13. To the aforementioned extent, this appeal is allowed. In the facts and circum.stances of the case, however, there shall be no order as to costs. I E K.K.T. Appeal partly allowed. (