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IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO   418    OF 2018 [Arising out of SLP(C) No.7375 of 2017]

RAMRAO LALA BORSE AND ANR        ..Appellants   

VERSUS

NEW INDIA ASSURANCE COMPANY  LTD. AND ANR      ..Respondents  

J U D G M E N T

Dr D Y CHANDRACHUD, J

1 The present  appeal  arises from a judgment  and order  of  a  Division

Bench of the High Court of Judicature at Bombay dated 23 October 2015.

The High Court has partly allowed the appeal of the insurer and reduced the

award  of  compensation  by  the  Motor  Accident  Claims  Tribunal  from  Rs

61,55,000/- to     Rs 26,45,000/-.   

2 The claim before the Tribunal arose thus:

On 19 February 2006, Deepak was travelling as a passenger in a luxury bus

on Mumbai-Agra road and was occupying a seat on the driver’s side.  When

the  bus  was  at  Atgaon  in  Nashik  district,  a  truck  bearing  Registration

No.RJ-01-G-6386 came from the opposite direction and collided with the bus

REPORTABLE

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resulting in grievous injuries to the passengers including Deepak.  Deepak

was shifted to the Government hospital at Nashik where he succumbed to his

injuries.

3 At the time of the accident, the deceased was serving as an Assistant

Teacher in Dadasaheb Dandekar Vidyalaya,  a school  run by Shishu Vihar

Education Society.  The claimants, who were his parents, filed a claim under

Section 166 of the Motor Vehicles Act 1988 seeking compensation against the

owner  of  the  offending  truck  and  the  insurer.   The Tribunal  held  that  the

accident was caused due to the rash and negligent act of the driver of the

offending  truck.   The  Tribunal  accepted  the  evidence  adduced  by  the

Claimants  that  had  the  deceased  survived,  he  would  have  been  made

permanent and would have been entitled to the benefit of 6 th Pay Commission

wages of  at  least  Rs 40,000 per  month.   Adopting a multiplier  of  17,  the

Tribunal awarded compensation of Rs 61,20,000/- to which it added a further

sum of Rs 35,000/- under conventional heads. Interest was awarded @9%

p.a.

4 The High Court, on an analysis of the evidence, confirmed the finding of

negligence arrived at by the Tribunal.  On compensation, the High Court noted

that the salary certificate (Exh.42) dated 18 March 2013 indicated that the

deceased was working as an Assistant Teacher on a temporary basis in the

secondary section of Shishu Vihar Education Society between June 2001 and

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February 2006.  The income certificate indicated that in February 2006 the

deceased  was  in  receipt  of  a  salary  of  Rs  2,800  per  month.   Another

certificate issued by the Headmaster on 20 March 2006 (Exh.47) indicated the

same position.  

5 The case of the claimants rested on the premise that the deceased was

likely to be made permanent in which event, he would be entitled to a higher

salary.  PW 3, who was the Secretary of the Trust, deposed that though the

strength  of  the  students  had  increased,  and  the  workload  had  increased,

persons such as the deceased continued in service on a contract basis for

want of sanction from the government for the post. The High Court observed

that the evidence of PW 3 was that if the government were to sanction the

post,  considering  the  seniority  and experience of  the  deceased,  the  Trust

would have appointed him as a permanent teacher in which event his salary,

according  to  the  scales  of  the  6th Pay Commission,  would  have been Rs

40,000 per month. The finding was that the deceased at the relevant time was

29 years of  age;  that  he had completed his B.Ed.   from the University of

Mumbai  and was  an Assistant  Teacher  employed on a temporary/contract

basis for teaching English from 2001 to 2006. The High Court adverted to the

provisions  contained  in  the  Maharashtra  Employees  of  Private  Schools

(Conditions of  Service) Regulation Act,  1977. In this background, the High

Court arrived at the finding that if the deceased were to be alive, he would

have been regularized and would have drawn a salary of Rs 40,000/- per

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month.  The High Court held that an addition of 50 per cent on account of

future prospects ought to have been made.  However, the High Court held

that the Tribunal erred in applying a multiplier of 17.  Having regard to the fact

that the father of the deceased was 65 years old in 2006 and his mother was

50 years old,  the High Court  came to the conclusion that a multiplier of 7

should be adopted, taking the average age of the parents as 61 years. The

High Court held that since the deceased was a bachelor, a deduction of 50

per cent should be made on account of personal expenses. On the above

basis,  the High Court  computed the yearly income of the deceased at  Rs

4,80,000; enhanced the income by 50% on the ground of future prospects to

Rs 7,20,000, deducted a sum of Rs 3,60,000 towards personal expenses and

on  the  basis  of  a  multiplier  of  7  arrived  at  a  total  compensation  of

Rs 25,20,000.  The amount payable to each of the two claimants for loss of

love and affection was enhanced to Rs 50,000 and funeral expenses of Rs

25,000  were  allowed.  The  High  Court  has,  accordingly,  awarded  a  total

compensation of Rs 26,45,000 together with interest @ 9% p.a.  

6 The principal ground which has been urged in support of the appeal is

that the High Court erred in applying a multiplier of 7.  Since the age of the

deceased at  the time of  the accident was 29 years,  it  was urged that the

correct multiplier to be applied would be 17.  

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7 The insurer had challenged the judgment of the High Court before this

Court in Special Leave Petition (C ) No 7717 of 2016.  The Special Leave

Petition was dismissed on 25 April 2016.  The challenge of the insurer to the

judgment of High Court has hence failed.  Consequently, for the purpose of

the present appeal, we will have to proceed on the basis of the income as

accepted by the High Court. The finding of fact in regard to the income of the

deceased would not be challenged in the present appeal, at the behest of the

insurer in view of the above background.  

8 In  terms of  the  judgment  of  the  Constitution  Bench of  this  Court  in

National Insurance Company Limited v Pranay Sethi1 and the judgment in

Sarla Verma v  Delhi  Transport  Corporation2,  the correct  multiplier  to be

applied in  the present  case would be 17 having regard to  the age of  the

deceased.  As regards future prospects, an addition of 50 per cent would be

warranted.  On  the  above  basis  and  making  a  deduction  of  50  per  cent

towards  personal  expenses  (the  deceased  being  a  bachelor),  the  total

compensation  would  stand  quantified  at  Rs  61,20,000/-.  After  making  an

addition  on  account  of  conventional  heads,  the  total  compensation  would

stand computed at   Rs 61,90,000/-. The aforesaid amount shall carry interest

@ 9% p.a. from the date of the filing of the claim petition.  Apportionment shall

be carried out in terms of the award of the Tribunal.   

1  (2017) 13 SCALE 12 2  (2009) 6 SCC 121

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9 The appeal shall accordingly stand allowed.  There shall be no order as

to costs.  

...........................................CJI           [DIPAK MISRA]

                                                   ...........................................J           [A M KHANWILKAR]

                                                   ...........................................J           [Dr  D Y  CHANDRACHUD]

New Delhi; January 19, 2018