Motor Vehicles Act,1988: Legal representative – Meaning of – Mother in law of deceased – Claim petition, maintainability – The term ‘legal representative’ should be given a wider interpretation for the purpose of Chapter XII of MV Act and it should not be confined only to mean the spouse, parents and children of the deceased – MV Act is a benevolent legislation enacted for the object of providing monetary relief to the victims or their families – Therefore, the MV Act calls for a liberal and wider interpretation to serve the real purpose underlying the enactment and fulfil its legislative intent – In order to maintain a claim petition, it is sufficient for the claimant to establish loss of dependency – s.166 of the MV Act makes it clear that every legal representative who suffers on account of death of a person in a motor accident should have a remedy for realization of compensation – Materials on record clearly establish that mother-in-law of victim-deceased was residing with him – She was dependent on him for her shelter and maintenance – It is not uncommon in Indian Society for the mother-in-law to live with her daughter and son-in-law during her old age and be dependent upon her son-in-law for her maintenance – She may not be a legal heir of the deceased, but she certainly suffered on account of his death – Therefore, she is a “legal representative” under s.166 of the MV Act and is entitled to maintain a claim petition. Motor Vehicles Act, 1988: Split multiplier – Applicability of – At the time of calculation of the income, the Court has to consider the actual income of the deceased and addition should be made to take into account future prospects – While the evidence in a given case may indicate a different percentage of increase, standardization of the addition for future prospects should be made to avoid different yardsticks being applied or different methods of calculation being adopted – In Pranay Sethi, the Constitution Bench has directed addition of 15% of the salary in case the deceased was between the age of 50 to 60 years as a thumb rule, where a deceased had a permanent job – In view of that, High Court was not justified in applying split multiplier in the instant case.
Motor Vehicles Act, 1988: s.166 – Deceased aged 52 years at the time of his death and having a permanent job – Applicable multiplier is ‘11’ – 15% of his actual salary should be added towards future prospectus – Four dependents left behind by the deceased – Hence, 1/4th of the income (actual salary + future prospects) should be deducted towards his personal expenses – In Pranay Sethi, this Court has awarded a total sum of Rs.70,000/- under conventional heads, namely, loss of estate, loss of consortium and funeral expenses and the said sum should be enhanced at the rate of 10% in every three years – The judgment in Pranay Sethi was rendered in the year 2017 – Therefore, in the instant case, the claimants are entitled for 10% enhancement.
Allowing the appeal, the Court
HELD: 1. Whether the High Court was justified in precluding the mother-in-law of the deceased (appellant no.4) as his legal representative?
1.1 The MV Act does not define the term ‘legal representative’. Generally, ‘legal representative’ means a person who in law represents the estate of the deceased person and includes any person or persons in whom legal right to receive compensatory benefit vests. A ‘legal representative’ may also include any person who intermeddles with the estate of the deceased. Such person does not necessarily have to be a legal heir. Legal heirs are the persons who are entitled to inherit the surviving estate of the deceased. A legal heir may also be a legal representative. The term ‘legal representative’ should be given a wider interpretation for the purpose of Chapter XII of MV Act and it should not be confined only to mean the spouse, parents and children of the deceased. MV Act is a benevolent legislation enacted for the object of providing monetary relief to the victims or their families. Therefore, the MV Act calls for a liberal and wider interpretation to serve the real purpose underlying the enactment and fulfil its legislative intent. In order to maintain a claim petition, it is sufficient for the claimant to establish his loss of dependency. Section 166 of the MV Act makes it clear that every legal representative who suffers on account of the death of a person in a motor vehicle accident should have a remedy for realization of compensation. [Paras 14, 16][1011-D-E; G-H; 1012-A]
1.2 It is settled that percentage of deduction for personal expenses cannot be governed by a rigid rule or formula of universal application. It also does not depend upon the basis of relationship of the claimant with the deceased. In some cases, the father may have his own income and thus will not be considered as dependent. Sometimes, brothers and sisters will not be considered as dependents because they may either be independent or earning or married or be dependent on the father. The percentage of deduction for personal expenditure, thus, depends upon the facts and circumstances of each case. [Para 17][1012-B-C]
Sarla Verma (Smt.) and Ors. v. Delhi Transport Corporation and Anr. (2009) 6 SCC 121 : [2009] 5 SCR 1098; Gujarat State Road Transport Corporation, Ahmedabad v. Ramanbhai Prabhatbhai and Anr. (1987)
3 SCC 234 : [1987] 3 SCR 404; Hafizun Begum (Mrs) v. Mohd. Ikram Heque and Ors.(2007) 10 SCC 715 : [2007] 8 SCR 487 – relied on.
Montford Brothers of St. Gabriel and Anr. v. United India Insurance and Anr. (2014) 3 SCC 394 : [2014] 1 SCR 835 – referred to.
1.3 Coming to the facts of the present case, the fourth appellant was the mother-in-law of the deceased. Materials on record clearly establish that she was residing with the deceased and his family members. She was dependent on him for her shelter and maintenance. She may not be a legal heir of the deceased, but she certainly suffered on account of his death. Therefore, she is a “legal representative” under Section 166 of the MV Act and is entitled to maintain a claim petition. [Para 21][1014-G-H; 1015-A-B]
2. Whether the High Court was justified in applying a split multiplier?
2.1 The deceased was aged 52 years at the time of the accident. He was working as an Assistant Professor and getting a monthly salary of Rs.83,831/-. The evidence on record shows that he was a meritorious man having the qualifications of M.Sc, M.Phil. He was a first-class holder in M.Sc. He was a Selection Grade Lecturer in Mathematics and was a subject expert. He was also included in the panel of Mahatma Gandhi University and was appointed as Examiner in the Board of Examiners for CBCCSS Programme in Mathematics. Subsequently, he was appointed as Deputy Chairman of the Examiners Board. Evidence on record also shows that there is acute shortage of lecturers in Mathematics for appointment in colleges and retired Mathematics Professors are appointed in so many colleges. It is common knowledge that the teachers, especially Mathematics teachers, are employed even after their retirement in coaching centers. They may also hold private tuition classes. This would increase their income manifold after retirement. [Para 22][1015-B-E] Reshma Kumari & Ors. v. Madan Mohan & Anr. (2013)
9 SCC 65 : [2013] 2 SCR 706 ; K.R. Madhusudhan and Ors. v. Administrative Officer and Anr. (2011) 4 SCC 689 : [2011] 2 SCR 1061; Puttamma and Ors. v. K.L. Narayana Reddy and Anr. (2013) 15 SCC 45 : [2013] 16 SCR 831 – referred to.
2.2 At the time of calculation of the income, the Court has to consider the actual income of the deceased and addition should be made to take into account future prospects. Further, while the evidence in a given case may indicate a different percentage of increase, standardization of the addition for future prospects should be made to avoid different yardsticks being applied or different methods of calculation being adopted. In Pranay Sethi, the Constitution Bench has directed addition of 15% of the salary in case the deceased was between the age of 50 to 60 years as a thumb rule, where a deceased had a permanent job. In view of the above, the High Court was not justified in applying split multiplier in the instant case. [Para 28][1017-H; 1018-A-B]
3. (III) What is the amount of compensation that should be awarded to the appellants?
3.1 The deceased was working as Assistant Professor at Devaswom Board Pampa College, Paruamala, and was drawing a monthly income of Rs.83,381/- which is clear from his salary certificate issued by the Principal of Devaswom Board Pampa College, Paruamala. The salary slip received by the deceased for the month of May 2011 also shows that his monthly salary was Rs.83,381/-. Thus, annual income of the deceased comes to Rs.10,00,572/-. This Court in Sarla Verma has made it clear that the Annual Income of the deceased minus the income tax should be taken into account at the time of his death for the purpose of calculation of loss of dependency. The deceased had to pay Rs.1,13,424/- towards income tax per annum. After deducting the said amount the actual income of the deceased comes to Rs.8,87,148/-. The deceased was aged 52 years at the time of his death and had a permanent job. Having regard to the judgment in Pranay Sethi, an addition of 15% of his actual salary should be added towards future prospectus. Therefore, 15% of his actual salary comes to Rs.1,33,072/-. [Paras 29, 30][1018-C-D, D-F]
3.2 Since the deceased was 52 years at the time of his death, the applicable multiplier is ‘11’. The total number of dependents left behind by the deceased is four. Hence, 1/4th of the income (actual salary + future prospects) should be deducted towards his personal expenses. In Pranay Sethi, this Court has awarded a total sum of Rs.70,000/- under conventional heads, namely, loss of estate, loss of consortium and funeral expenses. It was held that the said sum should be enhanced at the rate of 10% in every three years. The judgment in Pranay Sethi was rendered in the year 2017. Therefore, the claimants are entitled for 10% enhancement. Thus, a sum of Rs.16,500/- each is awarded towards loss of estate and funeral expenses. [Paras 31, 32, 33][1018-G-H; 1019-B, D-E]
3.3 A three-Judge Bench of this Court in United India Insurance Co. Ltd. vs. Satinder Kaur @ Satwinder Kaur and Ors, after considering Pranay Seth, has awarded spousal consortium at the rate of Rs.40,000/- and towards loss of parental consortium to each child at the rate of Rs.40,000/-. The compensation under these heads also needs to be increased by 10%. Thus, the spousal consortium is awarded at Rs.44,000/- and towards parental consortium at the rate of Rs.44,000/- each (Total Rs.88,000/-) is awarded to the two children. Thus, the appellants are entitled to compensation of Rs. 85,81,815/-. The appellants are also entitled to interest on the said amount at the rate of 7.5% per annum from the date of the claim petition till the date of its realization. [Paras 34, 35, 36][1019-E-H; 1020-A]
National Insurance Company Limited v. Pranay Sethi and Ors. (2017) 16 SCC 680 : [2017] 13 SCR 100; United India Insurance Co. Ltd. v. Satinder Kaur @ Satwinder Kaur and Ors. (2020) SCC Online SC 410 : AIR 2020 SC 3076 – relied on.
Megjibhai Khimji Vira v. Chaturbhai Taljabhagujri AIR 1977 Guj 195 ; Custodian of Branches of Banco National Ultramarino v. Nalini Bai Naique 1989 Supp
(2) SCC 275 : [1989] 2 SCR 810; Sudama Devi v. Jogendra Choudhary AIR 1987 Pat 239 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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