S. CHANDRASEKHARAN & ORS VERSUS M. DINAKAR & ANR.
S. CHANDRASEKHARAN & ORS VERSUS M. DINAKAR & ANR.
Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS. 46884689 OF 2022
(Arising out of SLP (C) Nos. 81198120 of 2019)
S. CHANDRASEKHARAN & ORS. …APPELLANT(S)
VERSUS
M. DINAKAR & ANR. ….RESPONDENT(S)
J U D G M E N T
ANIRUDDHA BOSE, J.
Leave granted.
2. The appellants before us are the claimants in an action for
compensation under the Motor Vehicles Act, 1988 (1988 Act). An
accident had occurred on 28th February 2011 at about 10:45
A.M., which resulted in death of one Bala Babitha, a 37 year old
lady, and caused injuries to her husband and her minor
daughter. The first appellant is the husband of the deceased. The
second and the third appellants are their children, who were
minors by age at the point of time the accident occurred. The
fourth appellant is the mother of the deceased. The first appellant
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and the third appellant alongwith the deceased were travelling in
an auto rickshaw from Velachery to Adambakkam in the city of
Chennai, which was hit by a vehicle (bearing registration no. TN04W6189). The respondent no. 1 was the owner of that vehicle.
The second respondent is the insurance company, whose policy
covered the offending vehicle.
3. Claim was lodged by the appellants under Section 166 of the
1988 Act before the Motor Accident Claims Tribunal, Chennai
(the Tribunal). Before the Tribunal, rash and negligent driving of
the offending vehicle was proved, and that finding was not upset
in appeal by the High Court of Judicature at Madras in its
judgment delivered on 27th February 2018. The present appeals
arise from that judgment. The Tribunal awarded compensation in
favour of the appellant no.1 for a sum of Rs.4,77,100/. The
minor daughter (appellant no.3) of the deceased and the first
appellant was awarded compensation of Rs.2,06,000/. The
quantum of compensation on account of death of said Bala
Babitha was computed by the Tribunal to be of Rs.36,92,350/.
Monthly income of the deceased was calculated as onethird of
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her husband’s income. The Tribunal found the husband’s income
to be Rs.78,700/ per month. This finding of monthly income of
the husband was not disturbed by the High Court. The
compensation amount was to carry an interest of 7.5% per
annum from the date of filing of the claim, till the date of deposit.
Deposit of the awarded sum was directed to be made within two
months from the date of the award.
4. Both the insurance company and the appellants preferred
separate appeals in respect of sums awarded as compensation in
relation to the deceased and the injured victims. The High Court
reduced the sum awarded as compensation in respect of the first
appellant to Rs.3,41,000/. As regards the third appellant, award
of Rs.2,06,000/ as compensation was retained. Compensation
awarded to the family of the deceased victim was modified and
reduced to Rs.32,82,090/ by the High Court. The Tribunal had
quantified compensation for the surviving members of the family
of deceased on her notional income calculated on the basis of her
husband’s income, following a judgment of this Court delivered in
the case of Arun Kumar Agrawal And Another vs. National
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Insurance Company Ltd. And Others. [(2010) 9 SCC 218]. The
High Court, however, considered her salary in a job she was
engaged in three years back to be the basis for quantifying the
pecuniary loss to be awarded to the surviving members of her
family. Both the Tribunal and the High Court had applied the
multiplier principle to arrive at the figure of pecuniary loss.
Before us, arguments have been advanced on the point of
reduction of compensation to the family of the deceased victim
and we shall confine our judgment to that issue only.
5. The heads under which award was made by the Tribunal
quantifying the compensation to be paid on account of the
deceased victim were:
Pecuniary Loss : Rs.31,50,000
Loss of consortium : Rs. 1,00,000
Funeral expenses : Rs. 25,000
Loss of love and
affection
: Rs.4,00,000
Medical expenses : Rs.17,350
Total Rs.36,92,350/
6. While modifying the award, the High Court computed the
compensation under the following heads:
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Pecuniary loss Rs.30,94,740.00
Loss of consortium Rs.40,000.00
Funeral Expenses Rs.15,000.00
Loss of Love and affection to
the claimantsRs.25,000
Rs.1,00,000.00
Loss of Estate Rs.15,000.00
Medical Expenses Rs.17,350.00
Total Rs.32,82,090.00
7. We are to address now as to whether the pecuniary loss
which had occurred on account of death of the victim has to be
computed on pegging it on her personal income she earned from
her employment approximately three years back or it should be
relatable to the income of her surviving husband. This question
arises as there was evidence before the Tribunal that the
deceased was a graduate with B. Com. degree and was employed
till the year 2008 in a company earning monthly salary of
Rs.34,385/. At the time of the accident, however, the deceased
was not employed. The Tribunal determined the compensation
relying on the case of Arun Kumar Agrawal (supra). It has been
held in this judgment:
“35. In our view, it is highly unfair, unjust and
inappropriate to compute the compensation payable
to the dependants of a deceased wife/mother, who
does not have a regular income, by comparing her
services with that of a housekeeper or a servant or an
employee, who works for a fixed period. The
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gratuitous services rendered by the wife/mother to
the husband and children cannot be equated with the
services of an employee and no evidence or data can
possibly be produced for estimating the value of such
services. It is virtually impossible to measure in terms
of money the loss of personal care and attention
suffered by the husband and children on the demise
of the housewife. In its wisdom, the legislature had,
as early as in 1994, fixed the notional income of a
nonearning person at Rs. 15,000 per annum and in
case of a spouse, 1/3rd income of the
earning/surviving spouse for the purpose of
computing the compensation.”
8. The High Court, on the other hand, proceeded on the basis
that it would be appropriate to fix the sum of Rs.34,385/ as the
monthly income of the deceased to arrive at just and fair
compensation in quantifying pecuniary loss. Reasoning of the
High Court on this aspect was:
“Though at the time of death, the deceased Bala
Babitha was a housewife, earlier she was working in
a private company and earning a sum of Rs.34,385/
per month, which is evident from Ex.Ps.23 & 24.
Hence, it would be appropriate to fix the sum of
Rs.34,385/ as monthly income of the deceased to
arrive at a just and proper compensation under the
head of pecuniary loss. If a sum of Rs.34,385/ is
taken as monthly income of the deceased, 50%
amount has to be deducted towards personal
expenses and if so deducted, the monthly
contribution to the family works out to Rs.17,193/.
The deceased was aged 37 years at the time of
accident; hence, the correct multiplier that has to be
applied in this case is 15. If the multiplier 15 is
applied, the total pecuniary loss works out to
Rs.30,94,740/ (17,193 x 12 x 15). Consequently, the
sum of Rs.31,50,000/ awarded by the Tribunal
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under the head Pecuniary Loss is hereby modified
and reduced to Rs.30,94,740/.”
(quoted verbatim from the paperbook)
9. In our opinion, the judgment of the High Court on this point
suffers from error on two counts. At the time of her death, the
deceased was not in employment. She was a homemaker. It was
not a case where the deceased at the time of accident had just left
her job. If that was the case, her last drawn salary might have
had given reliable guidance for computing her monthly income at
that point of time. Here the deceased remained without
employment for a period of approximately three years and what
she earned prior to that ought not to have been treated to be her
monthly income to arrive at just and proper compensation under
the head of pecuniary loss, as has been held by the High Court.
There is a long time gap between the time she was in employment
and the occurrence of the accident. Her monthly salary
approximately three years back thus would be an unreliable
guide for fixing her notional income when she succumbed to her
injuries caused by the accident. Moreover, at the time of the
accident, she was a homemaker providing care and support to
her family. In this context, in our opinion, the computation
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methodology prescribed in the case of Arun Kumar Agrawal
(supra) would be more appropriate to apply, which was done by
the Tribunal.
10. Plea has been taken before us on behalf of the insurance
company that the appellants could not take a stand for
computing the income of the deceased in the manner held in the
case of Arun Kumar Agrawal (supra), since before the High
Court, they had run a case that the pecuniary loss ought to be
computed on the basis of her last drawn salary. Just because the
appellants urged their claim based on the last drawn salary of the
deceased before the High Court, this Court ought not to anchor
its decision on that argument alone. It remains open to this Court
to examine the nature of the claim and compute the
compensation on a different criterion applying a different
parameter. This is more so, because such compensation figure
could be arrived at on the basis of materials on record, that
includes evidence on monthly earning of the husband of the
deceased and the applied parameter stands judicially recognised
as a legitimate mode for computing pecuniary loss. Further, in
this case, plea was made in the claim petition for compensation
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calculated on the basis of onethird of the husband’s income. In
the petition for special leave to appeals also, one of the points
formulated is as to whether compensation on account of death of
Bala Babitha would be calculated on the basis of her last drawn
salary or her husband’s income.
11. Section 168 of the Motor Vehicles Act, 1988 stipulates:
“168. Award of the Claims Tribunal.—On receipt of
an application for compensation made under section
166, the Claims Tribunal shall, after giving notice of the
application to the insurer and after giving the parties
(including the insurer) an opportunity of being heard,
hold an inquiry into the claim or, as the case may be,
each of the claims and, subject to the provisions of
section 163 may make an award determining the
amount of compensation which appears to it to be just
and specifying the person or persons to whom
compensation shall be paid and in making the award
the Claims Tribunal shall specify the amount which
shall be paid by the insurer or owner or driver of the
vehicle involved in the accident or by all or any of them,
as the case may be:
…..
(2) The Claims Tribunal shall arrange to deliver copies
of the award to the parties concerned expeditiously and
in any case within a period of fifteen days from the
date of the award.
(3) When an award is made under this section, the
person who is required to pay any amount in terms of
such award shall, within thirty days of the date of
announcing the award by the Claims Tribunal, deposit
the entire amount awarded in such manner as the
Claims Tribunal may direct.”
12. The aforesaid provision vests the Tribunal with the power
and jurisdiction to make an inquiry into claims arising out of
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deaths and injuries caused from an accident and make award
determining the compensation which appears to it to be just. It
would defeat the legislative purpose in the event the Tribunal or
the Appellate Forum is made to confine its inquiry to the plea of
the claimant as regards the factors which ought to be taken into
consideration for determining the compensation amount. Power
to hold an inquiry under the aforesaid provision cannot be
construed in such a restrictive manner. If the factors on which
quantification of claim is asked for cannot be established, the
adjudicatory forum under the 1988 Act would stand divested of
its power to arrive at just compensation even if in course of the
proceeding, materials disclosed could justify award of
compensation based on certain criteria other than those on which
the claim is founded. In the instant case, we find that the
Tribunal, while proceeding to award compensation to the
appellants/claimants had relied on the principle laid down by
this Court in the case of Arun Kumar Agrawal (supra) and there
was evidence before the Tribunal to assess the income of the
husband of the deceased. In fact, the first appellant’s
compensation was quantified taking into consideration his own
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income at the material point of time. In our opinion, the High
Court ought not to have proceeded on the basis of the income
drawn by the deceased victim approximately three years before
the accident ended her life. The Tribunal did not indulge in pure
guesswork in pegging the notional income of the deceased to her
husband’s income. As we have already observed, in the claim
petition itself, against the column “Occupation of the deceased”
income calculation of the deceased was contemplated on the
basis of her husband’s income. The Tribunal had rightly followed
the course laid down in the case of Arun Kumar Agrawal (supra),
which in the given facts, constituted, a more definitive and
reliable methodology for quantifying pecuniary loss.
13. So far as deduction on account of personal expenses of the
deceased, following the case of Sarla Verma (Smt) and Others
vs. Delhi Transport Corporation and Another [(2009) 6 SCC
121], the Tribunal directed deduction of 1/3rd of the earning of
the deceased, the latter being determined on the income of her
spouse. That was, in our view, the proper course. We hold so
because, even if we leave out the husband of the deceased from
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being treated as a dependent, there were two minor children at
the material point of time who ought to have been treated as
dependent family members. At that point of time the second
appellant was twelve years old and the age of injured daughter
was three years. In the case of Sarla Verma (supra) the
deduction has been held to be valid in a case where there were
dependent family members. We should not restrict the expression
“dependent” to mean those financially dependent only. Minor
children are emotionally dependent on the mother. They lost care
and guidance of their mother at a very young age. While arriving
at just compensation, the Tribunal ought to factor in the loss of
dependency in these terms.
14. The High Court did not give any reason for deducting 50% in
computing pecuniary loss and we do not think this was the
correct view. We are of the view that deduction of 1/3rd of
determined income of the deceased towards personal expenses is
valid on the basis of the decision of this Court in the case of Sarla
Verma (supra). We also find that neither the Tribunal nor the
High Court had considered loss of future prospect to arrive at the
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quantum of pecuniary loss. In the case of Rajendra Singh and
Others vs. National Insurance Company Limited and Others
[(2020) 7 SCC 256], addition of loss of future prospects has been
held to be a factor for determining compensation under the head
of pecuniary loss even in a case where the income of deceased is
arrived at on a notional basis. In this judgment it has been held:
“11. The notional income of the first deceased is therefore
held to be Rs 5000 per month at the time of death. The
compensation on that basis with a deduction of 1/4th i.e.
Rs. 15,000 towards personal expenses with a multiplier of
17 is assessed at Rs 7,65,000. If the deceased had
survived, in view of observations in Lata Wadhwa [Lata
Wadhwa v. State of Bihar, (2001) 8 SCC 197], her skills as
a matured and skilled housewife in contributing to the
welfare and care of the family and in the upbringing of the
children would have only been enhanced by time and for
which reason we hold that the appellants shall be entitled
to future prospects @ 40% in addition to the loss of
consortium and future expenses already granted. We
therefore assess the total compensation payable to the
appellants in the first appeal at Rs 11,96,000.”
15. The deceased was 37 years old at the time of her death.
Hence, there ought to be an addition of 40% to the notional
income of the deceased towards future prospects as she was
below 40 years of age. In the present case, it is not in dispute that
multiplier of 15 ought to be applied. In these circumstances, the
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total entitlement of the appellants under the head of pecuniary
loss would thus be:
Monthly income of the
deceased
Rs.26,250/
future prospects @ 40% of
the income (notional)
Rs.26,250 x 40/100 =
Rs.10,500/
[Rs.26,250 + Rs.10,500
= Rs.36,750/]
Deduction of 1/3rd for
personal living expenses
Rs.36,750 x 1/3 =
Rs.12,250/
[Rs.36,750 Rs.12,250
= Rs.24,500/]
Total pecuniary loss of the
deceased (with 15 as the
multiplier)
Rs.24,500 x 12 x 15 =
Rs.44,10,000/
16. We, accordingly, set aside the judgment of the High Court to
the extent of computation made of pecuniary loss on account of
death of said Bala Babitha for a sum Rs.30,94,740/. We quantify
the said sum to be Rs.44,10,000/.
17. Argument was also advanced on behalf of the respondents that
compensation awarded towards loss of love and affection is contrary
to the ratio of the judgement of this Court in case of United India
Insurance Company Limited vs. Satinder Kaur Alias Satwinder
Kaur and Others [(2021) 11 SCC 780]. It was held in this decision
that loss of love and affection is comprehended in loss of
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consortium, and there is no justification to award compensation
towards loss of love and affection as a separate head. The relevant
paragraphs from the judgement are reproduced below:
“34. At this stage, we consider it necessary to provide
uniformity with respect to the grant of consortium, and
loss of love and affection. Several Tribunals and the High
Courts have been awarding compensation for both loss of
consortium and loss of love and affection. The Constitution
Bench in Pranay Sethi, has recognized only three
conventional heads under which compensation can be
awarded viz. loss of estate, loss of consortium and funeral
expenses. In Magma General, this Court gave a
comprehensive interpretation to consortium to include
spousal consortium, parental consortium, as well as filial
consortium. Loss of Love and affection is comprehended in
loss of consortium.
35. The Tribunals and the High Courts are directed to
award compensation for loss of consortium, which is a
legitimate Conventional head. There is no jurisdiction to
award compensation towards loss of love and affection as
a separate head.”
18. We accept this argument advanced by the respondents. The
High Court has thus committed error in law while providing for
compensation under the heads of loss of love and affection and
also loss of consortium. Instead, in our opinion, compensation
provided under the head of loss of consortium would be Rs.
40,000/ for each appellant, comprehending the loss of love and
affection within it. Hence, the total compensation provided under
15
this head would amount to Rs 1,60,000/. That part of the
judgment of the High Court shall stand modified accordingly.
19. We find no reason to interfere with the High Court’s finding
as regards computation of compensation on other heads. Interest
of 7.5% per annum has been awarded by both the Tribunal and
the High Court. We do not disturb the concurrent views of the
High Court and the Tribunal on the rate of interest. Certain
authorities were cited on behalf of the appellants in support of
their argument for enhancing the rate of interest. The first one,
reported in [(2001) 2 SCC 9] related to an accident that occurred
on 20th March 1986. The next one, reported in [(2009) 8 SCC 507]
related to insurance claim on loss of stocks by fire and the date of
occurrence of the accident in that case was 24th August 1999. The
bank rate of interest has fallen over the years and for this reason
we sustain the award of the Tribunal and the High Court in
appeal on this point.
The total amount payable to the appellants on account of
death of Bala Babitha, thus, would be:
Pecuniary loss Rs. 44,10,000/
Loss of consortium Rs. 1,60,000/
Funeral expenses Rs. 15,000/
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Loss of estate Rs. 15,000/
Medical expenses Rs. 17,350/
Total Rs.46,17,350/
20. The aforesaid sum shall be payable to the appellants in the
proportion directed by the High Court except that in the case of
the 4th appellant (that is the mother of the deceased), we direct
lumpsum payment of Rs.2,00,000/ instead of Rs.1,00,000/ as
directed by the High Court. The aforesaid sum shall be paid
within two months from this date adjusting therefrom any
amount which may have already been paid to the appellants.
Unpaid amount shall carry interest at the rate of 7.5% per annum
from the date of filing of the claim petition till payment is made in
terms of this judgment and order.
21. The appeals are allowed in the above terms, without any
order as to costs.
22. Pending application(s), if any, shall stands disposed of.
………………………………., J.
(DINESH MAHESHWARI)
………………………………., J.
(ANIRUDDHA BOSE)
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NEW DELHI;
11th JULY 2022
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