The Commissioner of Income Tax (Central) vs. M/s Hyderabad House Pvt Ltd.,

MAC App. Nos. 554/2010 & conn.

Page 1 of 70

$~ * IN THE HIGH COURT OF DELHI AT NEW DELHI Reserved on : 29.04.2016/04.05.2016 / 05.05.16/11.05.16/12.05.2016

Pronounced on: 13th May, 2016

CHETAN MALHOTRA

..... Appellant Through Mr. Jasmeet Singh, Ms. Nishta Kishore and Mr. Srivats Kaushal, Advs.

versus

LALA RAM

..... Respondent Through Mr. Sudhanshu Tomar and Mr. S A Khan, Advs. for R-1 & 2 Mr. P R Sikka and Mr. Amit Sikka, Advs. for R-3

Mr. G K Kaushik, Adv. for R-4 2. MAC.APP. 226/2010

UNITED INDIA INSURANCE CO LTD ..... Appellant Through Mr. P R Sikka and Mr. Amit Sikka, Advs.

versus

LALA RAM & ORS

..... Respondents Through Mr. Sudhanshu Tomar and Mr. S A Khan, Advs. for R-1 & 2

Mr. G K Kaushik, Adv. for R-2

MAC App. Nos. 554/2010 & conn.

Page 2 of 70

SUMER SINGH CHAUHAN

..... Appellant

Through: Mr. O P Mannie, Adv.

versus

PANKAJ KUMAR AND ORS

.... Respondents

Through: Mr. Pradeep Gaur, Adv. for R-3

ORIENTAL INSURANCE CO LTD ..... Appellant

Through Mr. Ravi Sabharwal, Adv.

versus

RAKESH KUMAR & ORS

.... Respondents

Through None 5. MAC.APP. 421/2015 & CM No.9165/2015

ARJUN SINGH & ANR

..... Appellants

Through Mr. Om Prakash Gupta, Adv.

versus RAGHUKUL BHUSHAN BAKSHI & ANR (NATIONAL INSURANCE COMPANY LTD)

..... Respondents Through Ms. Neerja Sachdeva, Adv. for R-2 6. MAC.APP. 1288/2012 &CM Nos.21029/2012 & 1059/2014

MAC App. Nos. 554/2010 & conn.

Page 3 of 70

ORIENTAL INSURANCE COMPANY LTD ..... Appellant

Through Ms. Neerja Sachdeva, Adv.

versus

SUNITA DEVI & ORS.

..... Respondents Through Mr. O P Mannie, Adv. for R-1 & 2 7. MAC.APP. 881/2015

SUNITA DEVI & ANR

..... Appellants

Through Mr. O P Mannie, Adv.

versus

ORINETAL INSURANCE COMPANY LTD & ORS.

….. Respondents

Through Ms. Neerja Sachdeva, Adv. 8. MAC.APP. 1079/2013

SH PRAMOD KUMAR GOND @ PRAMOD & ANR

..... Appellants

Through Mr. O P Mannie, Adv.

versus

SH AMIT @ TITU & ORS

..... Respondents Through Ms. Suman Bagga, Adv. with Mr. Pankaj Gupta, Adv. for R-3 9. MAC.APP. 1187/2014

VIDHYA & ANR

..... Appellants

MAC App. Nos. 554/2010 & conn.

Page 4 of 70

Through Mr. Anshuman Bal, Adv.

versus

NATIONAL INSURANCE COMPANY LTD & ORS.

.... Respondents Through Ms. Neerja Sachdeva, Adv. for R-1 10. MAC.APP. 729/2013

THE NEW INDIA ASSURANCE CO. LTD. ..... Appellant

Through Mr. Pankaj Seth, Adv.

versus

HARI & ORS.

..... Respondents

Through Mr. S K Vashishta, Adv. for R-1 11. MAC.APP. 250/2013

NATIONAL INSURANCE CO. LTD. ..... Appellant

Through Mr.L.K. Tyagi, Adv.

versus

KIRAN DEVI & ORS.

..... Respondents Through Ms. Rupika Singh for Mr. Navneet Goyal, Adv. for R- 1 & 2

NEW INDIA ASSURANCE CO. LTD. ..... Appellant

MAC App. Nos. 554/2010 & conn.

Page 5 of 70

Through: Mr. Ravinder Singh and

Ms. Raveesha Gupta, Advocates

versus

LAL CHAND & ORS.

..... Respondents Through: Mr. Binay Kumar, Adv. for R-1 & R-2

SHAKILA BANO AND ORS.

..... Appellants Through: Mr. Anshuman Bal, Adv. versus

THE NEW INDIA ASSURANCE CO. LTD. AND ORS.

..... Respondents Through: Mr. Sameer Nandwani, Adv. for

R-1. 14. MAC.APP. 564/2014 and CM No.10489/2014

THE NEW INDIA ASSURANCE CO. LTD. ..... Appellant Through Mr. S N Parashar, Adv. for Mr. J P N Shahi, Adv.

versus

SEEMA GARG & ORS.

..... Respondents Through Mr. Anshuman Bal, Adv. for R- 1 & 2 15. MAC.APP. 956/2014

SONIYA JOSHI & ANR

MAC App. Nos. 554/2010 & conn.

Page 6 of 70

..... Appellant

Through: Mr. S N Parashar, Adv.

versus

SARAVJIT @ SONU & ORS (THE NATIONAL INSURANCE COMPANY LTD)

..... Respondents

Through: Ms. Rakhi Dubey, Adv. for R-3

SHRIRAM GENERAL INSURANCE CO LTD .....Appellant

Through: Mr. P. Acharya, Advocate

versus

ZEENAT FATIMA & ORS

....Respondents

Through: Mr. Nitin Yadav, Adv. for R-1 & 2 CORAM: HON'BLE MR. JUSTICE R.K.GAUBA

JUDGMENT

R.K.GAUBA, J: 1. These sixteen appeals give rise to common questions of law concerning the method of calculation of compensation in accident claim cases involving deaths of children in motor vehicular accidents and hence have been taken up for being decided together by this common judgment.

MAC App. Nos. 554/2010 & conn.

Page 7 of 70

FACTUAL MATRIX 2. The background facts leading to these appeals in each case may be taken note of at the outset in chronological order. Case ‘A’ : MAC Appeal Nos. 226/2010 & 554/2010 (In re: death of three months‟ old child Rama Kant)

MAC App. Nos. 554/2010 & conn.

Page 8 of 70

date of filing of the petition till realization, and is doing so following the method of calculation of compensation adopted by the Supreme Court in R.K. Malik vs. Kiran Pal 2009 (14) SCC 1 and decision of a learned Single Judge of this Court in National Insurance Company Ltd. vs. Farzana 2009 ACJ 2763. 4. The insurance company by its appeal (MAC Appeal No. 226/2010) questions the calculation of compensation on the ground that the deceased child being only three months old, the award of compensation of ₹ 3,75,000/- was unduly high since there can be no parallel drawn with the awards rendered in the case of R.K. Malik (supra). 5. This case also involves plea of the insurer about breach of terms and conditions of the insurance policy. This aspect shall need elaboration and consideration at an appropriate stage in this judgment. Case ‘B’ : MAC Appeal No. 580/2007 (in re: death of seven years‟ old child Yash Chouhan)

MAC App. Nos. 554/2010 & conn.

Page 9 of 70

tribunal by judgment dated 01.05.2007 (which also governed two other cases relating to injuries suffered by the parents of the child), held both the scooter driver and tempo driver guilty of negligence. Contributory negligence on the part of Sumer Singh Chouhan was assessed at 30%. The tribunal awarded `2,25,000/- as compensation for death of the child, with interest at the rate of 7% p.a. in favour of the claimants directing the insurer to pay to the extent of 70% though granting it recovery rights against the owner on account of finding about breach of terms and conditions of the insurance policy. In assessing the compensation, it referred to the judgments of the Supreme Court in Lata Wadhwa Vs. State of Bihar and Ors, 2001 ACJ 1735 and Manju Devi and Ors. Vs. Musafir Paswan & Ors., 2005 ACJ 99. By the appeal at hand, the claimants seek enhancement in the compensation also challenging the finding on contributory negligence.

Case ‘C’ : MAC Appeal No. 250/2013 (In re: death of eleven years‟ old child Mukesh)

MAC App. Nos. 554/2010 & conn.

Page 10 of 70

vehicle), admittedly insured against third party risk for the period in question with the National Insurance Co. Ltd. (insurer). The tribunal, by the impugned judgment, upheld the case about negligent driving and fastened the liability against the insurer to pay compensation in the sum of ` 12,11,400/- with interest at 7.5% per annum from the date of filing of the petition, calculating it after assuming the potential income of the deceased at ` 10,800/- per month, relying upon the judgment of a learned Single Judge of this court in United India Insurance Co. Ltd. Vs. Kanwar Lal (MAC Appl. 385/2007 decided on 27-04-2012) which, in turn, was primarily based on the judgment of the Supreme Court in Municipal Corporation of Delhi Vs. Uphaar Tragedy Victims Association (2011)14 SCC 481. The tribunal calculated loss of dependency by deducting 50% towards personal & living expenses and applying the multiplier of 18, having regard to the age of the deceased, also adding ` 25,000/- towards loss of love & affection and ` 10,000/- each towards funeral charges and loss of estate. 8. The insurer, by this appeal, questions the above mentioned award contending that the tribunal has fallen in serious error by assuming the potential income at such high rate, without any basis, only on the oral word that the mother “desired” the deceased son to eventually become an engineer and further by applying the multiplier chosen on the basis of age of the deceased.

MAC App. Nos. 554/2010 & conn.

Page 11 of 70

Case ‘D’ : MAC Appeal No. 510/2014 (In re: death of 17 years‟ old child Mohit)

MAC App. Nos. 554/2010 & conn.

Page 12 of 70

Case ‘E’ : MAC Appeal No. 1106/2013 (In re: death of four years‟ old child Vishal)

MAC App. Nos. 554/2010 & conn.

Page 13 of 70

been made to the extent of 50% as is normally done in cases of deaths of bachelors, particularly in view of dicta in Sarla Verma (Smt.) & Ors. v. Delhi Transport Corporation & Anr., (2009) 6 SCC 121.

Case ‘F’ : MAC Appeal Nos. 1288/2012 & 881/2015 (In re: death of sixteen years‟ old Seema Kumari)

MAC App. Nos. 554/2010 & conn.

Page 14 of 70

v. Bachitar Singh, (2011) 11 SCC 425 and in Baby Radhika Gupta v. Oriental Insurance Company Ltd., ( 2009 ) 17 SCC 627, with loss of dependency calculated at Rs. 5,52,216/- worked out on the monthly minimum wages (Rs. 4382/-) of the unskilled workers taken as per the judgment of this court in Ramehar & Ors. v. Vinod Kumar & Ors. (2009) ACJ 452 with addition of future prospects of increase to the extent of 50%, having deducted 50% towards personal & living expenses while relying upon the Supreme Court judgments in Sarla Verma (Smt.) & Ors. v. Delhi Transport Corporation & Anr., (2009) 6 SCC 121 and Santosh Devi v. National Insurance Company Ltd. & Ors., 2012 (6) SCC 421 and capitalizing it with the multiplier of 14 on the basis of age of the claimant mother (44 years old) in view of dicta in Amrit Bhanu Shali & Ors. v. National Insurance Co. Ltd., (2012) 11 SCC 738. 14. The claimants by their appeal (MAC appeal No. 881/2015) submit that the non-pecuniary heads of damages have not been property taken care of. Case ‘G’ : MAC Appeal No.175/2014 (In re: death of seventeen years‟ old child Hussain Haider)

MAC App. Nos. 554/2010 & conn.

Page 15 of 70

child, on account of the death in a motor vehicular accident that occurred on 17.07.2010 involving tempo bearing registration no.UP- 81AB-9028 (offending vehicle) in negligent manner, the said vehicle admittedly being insured against third party risk with the appellant. The amount of compensation awarded includes Rs.4,88,248/- towards medical expenses, the compensation towards loss of dependency and other non-pecuniary heads being in the sum of Rs.7,13,827/-. It was conceded at the time of hearing that the child was born on 02.05.1993 and thus at the time of his death on 17.07.2010, he was a little over 17 years in age. The tribunal calculated the loss of dependency assuming the income of the deceased at Rs.6,448/- adopting the minimum wages of a matriculate and applying the multiplier of 13, going by the age of the mother (46 years). 16. The appellant questions the award as inflated, submitting that the method adopted is not in accord with principles to be followed in such cases. Case ‘H’ : MAC Appeal No. 729/2013 (In re: death of three years‟ old Varsha)

MAC App. Nos. 554/2010 & conn.

Page 16 of 70

on account of death of their three years‟ old daughter Varsha in motor vehicular accident that had occurred on 09.08.2010 involving negligent driving of motor vehicle described as HP 12 C 1930 (offending vehicle), admittedly insured for the period in question with New India Assurance Company Ltd. (appellant) which was called upon to satisfy the award. The tribunal made the said award following the method of computation adopted in R.K.Malik (supra). 18. The insurer in its appeal questions the above said computation on the grounds that the award is not in accord with the view taken in R.K.Malik (supra) as no deduction has been made towards personal & living expenses. Case ‘I’ : MAC Appeal No. 421/2015 (In re: death of fourteen years‟ old Raju)

MAC App. Nos. 554/2010 & conn.

Page 17 of 70

Case ‘K’ : MAC Appeal No.564/2014 (In re: death of 10 years‟ old child Rishabh Garg)

MAC App. Nos. 554/2010 & conn.

Page 18 of 70

₹63,527/-. The insurance company challenges the award on the ground it is not in accord with R.K. Malik (supra).

Case ‘L’ : MAC Appeal No.956/2014 (In re: death of eleven years‟ old child Master Gautam Joshi) 22. On 02.10.2011, a motor vehicular accident took place involving negligent driving of a vehicle bearing registration as DL-1YB 6781 admittedly insured against third party risk with the National Insurance Company Ltd. (third respondent) for the period in question, resulting in death of eleven years old Gautam Joshi. His parents (appellants) had instituted an accident claim case (suit no.38/12/12) on 14.12.2011 impleading the insurer, driver and owner of the offending vehicle as respondents. By judgment dated 31.05.2014, the tribunal upheld the case about the death having occurred due to negligent driving, the said finding having attained finality. The tribunal awarded compensation in the sum of Rs.3,75,000/- primarily following the view taken in the case of Farzana (supra). 23. By the appeal at hand, the claimants seek enhancement of the compensation. Case ‘M’ : MAC Appeal No. 1187/2014 (In re: death of fourteen years‟ old Bhanu @ Bhanu Kataria)

Case ‘N’ : MAC Appeal No. 1079/2013 (In re: death of four years‟ old Kumari Lajo @ Sanjana)

MAC App. Nos. 554/2010 & conn.

Page 19 of 70

The offending vehicle in the case of death of Bhanu @ Bhanu Kataria was bus bearing No. DL 1PB 7483, again admittedly insured against third party risk with National Insurance Company Ltd. The death of Kumari Lajo had occurred in a motor vehicular accident involving car bearing No. DL 4C 7061, admittedly insured against third party risk with Reliance General Insurance Company Ltd. In these cases, the tribunal (by judgments dated 29.09.2014 and 29.07.2013) has awarded compensation in the sum of Rs. 3,75,000/- each with interest (@ 9% per annum in the first case and @ 7.5 % in the second case) with effect from the date(s) of filing of the petitions (15.05.2012 and 22.02.2013 respectively) till realization, in favour of the parents (the claimants) of the respective child.

THE ISSUE

MAC App. Nos. 554/2010 & conn.

Page 20 of 70

Case Date of accident (Death) Age of deceased child Compensation awarded by tribunal (`) Date of award by tribunal A. 17.03.1993 3 months 3,75,000/- 16.01.2009 B. 02.09.2002 7 years 2,25,000/- 01.05.2007 C. 24.09.2007 11 years 12,11,400/- 14.01.2013 D. 27.08.2008 17 years 6,56,646/- 07.04.2014 E. 21.02.2009 4 years 7,50,000/- 16.09.2013 F. 18.03.2009 16 years 5,87,216/- * 07.09.2012 G. 17.07.2010 17 years 7,13,827/-* 31.10.2013 H. 09.08.2010 3 years 3,75,000/- 23.05.2013 I. 09.04.2011 14 years 3,75,000/- 09.12.2014 J. 14.05.2011 17 years 4,20,000/- 13.12.2012 K. 30.06.2011 10 years 6,68,520/-* 26.04.2014 L. 02.10.2011 11 years 3,75,000/- 31.05.2014 M. 02.05.2012 14 years 3,75,000/- 29.09.2014 N. 04.02.2013 4 years 3,75,000/- 29.07.2013 * excluding medical expenses also awarded.

MAC App. Nos. 554/2010 & conn.

Page 21 of 70

have been followed. The principles which were adopted in R.K. Malik (supra) concerning an accident that had occurred in 1997 were adopted by this court in Farzana (supra) against the backdrop of cause of action that had arisen three years later in 2000 but the said precedent has been followed even for purposes of accident of later years virtually till date. 28. The question which falls for consideration of this court thus concerns the appropriate formula to be adopted for computation of just compensation in the case of death of children such that there is no disparity. PRECEDENTS 29. It has been observed elsewhere, and it bears repetition to note in the present context, that India is one of the several countries with an unduly high rate of road accidents resulting in death, injury or damage, giving rise to claims for compensation brought before the tribunals by the victims or their next of kin. The law on the subject of compensation has been codified by inclusion of necessary provisions in the MV Act, including on the principle of fault liability (under Section 166). The decision to make an appropriate award of compensation in each case is entrusted in the hands of the tribunal. Whilst a simplified procedure for award of compensation “on structured formula basis” was introduced by insertion of Section 163A,

MAC App. Nos. 554/2010 & conn.

Page 22 of 70

by amending Act no.54 of 1994 (w.e.f. 14.11.1994) wherein it is restricted and controlled by the method indicated in the Second Schedule, in claim cases arising out of fault-liability principle, the legislative guidance through the provision contained in Section 168 is simply that the tribunal is expected to determine such amount of compensation as appears to it to be “just”. 30. The structured formula contained in Section 163A, enforced through the prescription in second schedule has been found to be full of errors or defects and, consequently, adversely commented upon in a number of cases by the Supreme Court [UPSRTC Vs. Trilok Chandra (1996) 4 SCC 362; Oriental Insurance Co. Ltd. Vs. Hansrajbhai v. Kodala (2001) 5 SCC 175; Sarla Verma v. DTC (2009) 6 SCC 121; Puttamma v. K.L. Narayana Reddy (2013) 15 SCC 45]. The said special provision was inserted in 1994 with the cap of ₹40,000/- on the income to be considered for calculating the loss of dependency (or income) in fatal accident cases. Though by sub-section (3), the legislature empowered the Central Government to amend the second schedule by notification from time to time “keeping in view the cost of living”, the said authorization has not resulted in any amendment being brought about to revise the annual income, even after elapse of more than two decades; regrettably so, particularly because the court has reminded the Government of its obligation in this regard a number of

MAC App. Nos. 554/2010 & conn.

Page 23 of 70

times [e.g. see Puttamma Vs. K.L. Narayana Reddy (2013) 15 SCC 45]. 31. Because of the strait-jacketed formula given by Section 163A, and perhaps more on account of erosion in the real value of money over the period, resort to the simplified structured formula seems to have fallen in disuse, except in cases relating to extremely poor sections of the society. Even a cursory comparison of the awards available under Section 163A with those handed down in cases under Section 166 on fault-liability principle reveals that the compensation received in the former in the present times cannot qualify, by any stretch of reasoning, as “just” compensation. 32. It has been noted ad nauseam in judgments after judgments that the approach of the tribunals and courts in determining the amount of compensation which is “just” has not only been not uniform or consistent but also beset by considerable variations most of the time due to adoption of divergent methods of calculation or on account of subjectivity. In Nagappa v. Gurdayal Singh 2003 (2) SCC 274, the Supreme Court ruled that the main guiding principle for determining the compensation is that it “must be just” and further that it “must be reasonable”. As observed in UP State Road Transport Corporation v. Trilok Chandra (1996) 4 SCC 362 compensation awarded in such cases has primarily two elements; the pecuniary loss to the estate of the deceased resulting from the accident and the pecuniary loss sustained by members of his family on account of his death, in

MAC App. Nos. 554/2010 & conn.

Page 24 of 70

addition to the conventional awards under non-pecuniary heads of damages (e.g. loss of consortium, loss of love & affection, funeral expenses etc.). In Gobald Motor Service Ltd. v. R. M. K. Veluswami AIR 1962 SC 1, the court quoted with approval the views of House of Lords in Davies v. Powell Duffryn Associated Collieries Ltd. (1942) AC 601 that “the damages are to be based on the reasonable expectation of pecuniary benefit or benefits reduceable to money value”. But, as stated in General Manager, Kerala, State Road Transport Corporation v. Susamma Thomas (1994) 2 SCC 176, “much of the calculation necessarily remains in the realm of hypothesis” and since there are “so often many imponderables”, the Court must try to assess, as best as it can, the loss suffered against the “overall picture” that only matters. 33. In Susamma Thomas (supra), the court ruled that in fatal accident action, the measure of damages is the pecuniary loss suffered or likely to be suffered by each dependent as a result of the death and that : “9. The assessment of damages to compensate the dependants is beset with difficulties because from the nature of things, it has to take into account many imponderables, e.g., the life expectancy of the deceased and the dependants, the amount that the deceased would have earned during the remainder of his life, the amount that he would have contributed to the dependants during that period, the chances that the deceased may not have lived or the dependants may not live up to the estimated remaining period of their life

MAC App. Nos. 554/2010 & conn.

Page 25 of 70

expectancy, the chances that the deceased might have got better employment or income or might have lost his employment or income altogether.”

MAC App. Nos. 554/2010 & conn.

Page 26 of 70

MAC App. Nos. 554/2010 & conn.

Page 27 of 70

MAC App. Nos. 554/2010 & conn.

Page 28 of 70

V. Pushpa & Ors. (2015) 9 SCC 166] – the view taken and the method adopted for computation of compensation in case of death of children appears to be still not uniform or consistent, clearly for the reason the factors that go into calculations in such cases suffer from even greater uncertainties and imponderables. Lord Atkinson – as quoted in R.K. Malik (supra) (para 13) – observed in Taff Vale Railway Co. v. Jenkins 1913 AC 1 : (1911-13) All ER Rep 160 (HL), as under : “11. … In case of the death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child's lifetime. But this will not necessarily bar the parents' claim and prospective loss will found a valid claim provided that the parents establish that they had a reasonable expectation of pecuniary benefit if the child had lived.”

MAC App. Nos. 554/2010 & conn.

Page 29 of 70

The injury inflicted by deprivation of the life of a child is extremely difficult to quantify. In view of the uncertainties and contingencies of human life, what would be an appropriate figure, an adequate solatium is difficult to specify. The courts have therefore used the expression “standard compensation” and “conventional amount/sum” to get over the difficulty that arises in quantifying a figure as the same ensures consistency and uniformity in awarding compensations.”

“In case of the death of an infant, there may have been no actual pecuniary benefit derived by its parents during the child‟s lifetime, but this will not necessarily bar the parents‟ claim and prospective loss will found a valid claim provided that the parents establish that they had a reasonable expectation of pecuniary benefit if the child had lived. At the same time, it must be held that a mere speculative possibility of benefit is not sufficient. Question whether there exists a reasonable expectation

MAC App. Nos. 554/2010 & conn.

Page 30 of 70

of pecuniary advantage is always a mixed question of fact and law. In case of a bright and healthy boy, his performance in the school, it would easier for the authority to arrive at the compensation amount, which may be different from another sickly, unhealthy, rickety child and bad student.”

MAC App. Nos. 554/2010 & conn.

Page 31 of 70

“..12. In cases of young children of tender age, in view of uncertainties abound, neither their income at the time of death, nor the prospects of the future increase in their income nor chances of advancement of their career are capable of proper determination on estimated basis. The reason is that at such an early age, the uncertainties in regard to their academic pursuits, achievements in career and thereafter advancement in life are so many that nothing can be assumed with reasonable certainty. Therefore, neither the income of the deceased child is capable of assessment on estimated basis nor the financial loss suffered by the parents is capable of mathematical computation..”

MAC App. Nos. 554/2010 & conn.

Page 32 of 70

incurred towards maintaining himself had he been alive. Thus, the tribunal took the loss of earnings (on which loss to estate was to be compensated) at ₹10,000/- per annum. In the case of the third category (age group of 15 to 18 years), the multiplier of 16 was applied while in the second category (10 to 15 years), the multiplier of 15 was applied. It appears that in the first category (children less than 10 years in age), the multiplier of 10 was adopted. The tribunal proceeded to add ₹5,000/- each towards funeral and last rites. Thus, the total compensation awarded by the tribunal in the three categories was ₹1,05,000/- (for children less than 10 years), ₹1,55,000/- (for children in the age group of 10 to 15 years) and ₹1,65,000/- (for children in the age group of 15 to 18 years). 43. The claimants, feeling dissatisfied, took out appeals before this Court which were decided by a learned single Judge by judgment dated 17.05.2006, reported as R K Malik & Ors. v. Kiran Pal & Ors. [III (2006) ACC 261, 2007 ACJ 2010, (2006) ILR 1 Delhi 866]. It appears that the focus of challenge against the awards granted by the tribunal in the appeals before this Court was primarily on the non- pecuniary damages. The learned single Judge noted the lump-sum award of ₹50,000/- as the conventional figure for payment of non- pecuniary damages made in the cases of death of children in Lata Wadhwa (supra) and held as under :

“The decision in the case of Lata Wadhwa (supra) relates to a fire accident in 1989 and therefore this

MAC App. Nos. 554/2010 & conn.

Page 33 of 70

figure of conventional compensation has to be adequately enhanced to compensate for inflation and declining value/purchasing power of the Rupee. As per notified cost of inflation index issued by the Govt. of India under Section 48 of the Income tax Act, 1961 with base year as 1981-82 (= 100), the index was 172 in 1989-90 and 331 in the financial year 1997-98. If we go by the said figures the corresponding value of Rs.50,000/- in 1989 would be Rs. 97,000/- (approx.) in 1997. Taking the figure awarded in Lata Wadhwa‟s case and keeping in view the “just compensation” as awarded in several other cases mentioned above and also applying the principle of moderation, I feel that in all cases a uniform sum of Rs.75,000/- should be awarded towards non-pecuniary compensation as conventional compensation or in other words compensation for loss of expectancy of life and pain and suffering etc. suffered by the victims due to the death. Thus the compensation payable to the appellants gets enhanced by Rs.75,000/- in all the cases. The appellants for the sake of uniformity will also be entitled to Rs.1000/- towards loss of books wherever the same has not been awarded by the ld. tribunal. I may however add a word of caution that the above “conventional amount” may not be applicable in cases of death of adults and this aspect has not been examined by me.”

MAC App. Nos. 554/2010 & conn.

Page 34 of 70

been raised before the Supreme Court, while holding that “deviation from the structured formula as provided in the Second Schedule is not ordinarily permissible” even when “compensation is payable under Section 166 read with Section 168 of the Act”, the court ruled that the notional income mentioned in the second schedule and the multiplier specified therein “can form the basis for the pecuniary compensation for the loss of dependency” in the said cases. While affirming the calculation of pecuniary compensation by the tribunal and the High Court, the Supreme Court made the following observations which are of utmost relevance to the issues raised before this Court in the present matters : 17. We must point out here that the learned counsel for the appellants had argued that the notional sum of Rs 15,000 should be enhanced and increased as the legislature has not amended the Second Schedule and the same continues to be in existence since it was enacted on 14-11-1994. We are not examining and going into this aspect as the accident had taken place in the present case nearly three years after the enactment of the Second Schedule. The time difference between the date of the enactment and the date of accident is not substantial.

MAC App. Nos. 554/2010 & conn.

Page 35 of 70

MAC App. Nos. 554/2010 & conn.

Page 36 of 70

who were sitting in the balcony class (where rate of admission was higher) as those belonging to a strata of society where the monthly income could not be less than ₹15,000/-. Adopting the multiplier of 15 in all such cases where the deceased persons were more than 20 years, after deducting 1/3rd for personal expenses, this Court had granted compensation in the sum of ₹18 lakhs per such person. For those below 20 years, the Court had reduced the said amount by ₹3 lakhs and awarded compensation at flat rate of ₹15 lakhs. The Supreme Court found the assumption of income on the basis of class of seat where the deceased persons were sitting in the cinema hall to be improper. Observing that it was “unsafe to use a high income as the determinative factor”, the claims having arisen in a public law remedy, the Court reduced the compensation in the case of persons aged 20 years or more to the sum of ₹10 lakhs and for those below 20 years in sum of ₹7.5 lakhs, granting liberty to those seeking more compensation on the basis of higher income to approach the Registrar General of this Court with their applications for summary inquiry to be conducted to determine the compensation in each case. 49. Reference has also been made, in the course of arguments, to the decision of the Supreme Court in Manju Devi Vs. Musafir Paswan, VII (2005) SLT 257. It was an appeal arising out of claim due to death of a thirteen years‟ old boy in a motor vehicular accident that had occurred on 02-07-1998. The matter was decided by the Supreme Court on 31- 03-2003. The tribunal had awarded a lump-sum amount of ` 90,000/-

MAC App. Nos. 554/2010 & conn.

Page 37 of 70

which had been upheld by the High Court. The Supreme Court increased the award to ` 2,25,000/- applying the notional income of non-earning person (` 15,000/-), as specified in the Second Schedule of MV Act and adopting the multiplier of 15. 50. Kaushalya Devi Vs. Karan Arora, 2007 11 SCC 120 is yet another case relied upon by the insurance companies. It arose out of death of a minor (fourteen years‟ old boy), the claim having been preferred under section 166 of MV Act by his parents, the accident having occurred on 05-02-1997. The tribunal awarded the amount of rupees one lakh with interest and the appeal preferred by the claimant was dismissed by the High Court. The Supreme Court upheld the said decision and dismissed the claim of the claimant for further enhancement, observing thus: “There are some aspects of human life which are capable of monetary measurement, but the totality of human life is like the beauty of sunrise or the splendor of the stars, beyond the reach of monetary tape- measure. The determination of damages for loss of human life is an extremely difficult task and it becomes all the more baffling when the deceased is a child and/or a non-earning person. The future of a child is uncertain. Where the deceased was a child, he was earning nothing but had a prospect to earn. The question of assessment of compensation, therefore, becomes stiffer. The figure of compensation in such cases involves a good deal of guesswork. In cases, where parents are claimants, relevant factor would be age of parents.”

MAC App. Nos. 554/2010 & conn.

Page 38 of 70

MAC App. Nos. 554/2010 & conn.

Page 39 of 70

MAC App. Nos. 554/2010 & conn.

Page 40 of 70

19-07-1992. The Supreme Court declined to adopt the income specified in the Second Schedule to MV Act and after assuming the notional income as ` 30,000/- granted the compensation in the sum of ` 4,50,000/- on account of loss of dependency besides ` 50,000/- under the conventional head. ANALYSIS 55. The method of assessment in Lata Wadhwa (supra) was followed, with improvement, albeit for calculating non-pecuniary damages, in R.K. Malik (supra). What is pertinent to note, however, is that the court drew a distinction qua senior age-group (those studying in 6th to 10th standards) and assumed income higher than that of notional income, having regard to the prospects of their employability in future. The view taken in Kaushalya Devi (supra) wherein the lumpsum award of ₹1 Lakh only was upheld in the case of death of a 14 years‟ old boy on 05.02.1997, need not be followed as binding precedent in view of the dicta of the Supreme Court in R.K. Malik (supra). The view taken in Satender (supra) also must be kept aside as the judgment in R.K. Malik (supra) would prevail over it. The award granted in Uphaar Tragedy (supra) may not be used as a precedent for the reasons what was granted by the Supreme Court in a case arising out of public law remedy was only tentative, the final computation having been left to further inquiry, in the peculiar facts and circumstances of that case. The case of Manju Devi (supra) essentially

MAC App. Nos. 554/2010 & conn.

Page 41 of 70

followed the same line as taken in R.K. Malik (supra). The difficulty with the ruling in Kishan Gopal (supra) is that though the cause of action had arisen in July 1992, the Supreme Court while rendering the final decision on 26.08.2013, made the computation by assuming the notional income at twice the rate of the one given in Second Schedule on account of elapse of time not referring to the earlier decision in R.K. Malik (supra), the prime take away from the said judgment, however, being the acknowledgement that the notional income fixed by the legislature in 1994 would not hold good in the face of drastic reduction in rupee value over the years. 56. The court faces the challenge of determining “just compensation”, in each such case. The issue needs to be addressed, inter alia, in the context of considerations in the nature of future prospects and inflationary trends affecting the loss of real value of money. In Sarla Verma (supra), a bench of two Hon‟ble Judges of the Supreme Court standardized the method of calculation of the factor of future prospects to be taken into account but kept the category of those who were “self employed” or working on a “fixed salary” out of its purview. The decision in Sarla Verma was upheld by a bench of three Hon‟ble Judges of the Supreme Court in Reshma Kumari v. Madan Mohan (supra). A divergent view was taken on this subject by another bench of three Hon‟ble Judges in Rajesh v. Rajbir (supra), approving certain observations in judgment in another case reported as Santosh

MAC App. Nos. 554/2010 & conn.

Page 42 of 70

Devi v. National Insurance Co. Ltd. (2012) 6 SCC 421. Though the question of permissibility of “future prospects” to be considered in the two above mentioned categories (“self employed” or those on “fixed salary”) is still at large, it having been referred to a larger bench, certain observations in Santosh Devi (supra) are germane to the questions raised before this Court and thus, need to be quoted. In Santosh Devi (supra) the Supreme Court said thus : “11. We have considered the respective arguments. Although, the legal jurisprudence developed in the country in last five decades is somewhat precedent-centric, the judgments which have bearing on socio-economic conditions of the citizens and issues relating to compensation payable to the victims of motor accidents, those who are deprived of their land and similar matters needs to be frequently revisited keeping in view the fast changing societal values, the effect of globalisation on the economy of the nation and their impact on the life of the people. … 15. The rise in the cost of living affects everyone across the board. It does not make any distinction between rich and poor. As a matter of fact, the effect of rise in prices which directly impacts the cost of living is minimal on the rich and maximum on those who are self- employed or who get fixed income/emoluments. They are the worst affected people. Therefore, they put extra efforts to generate additional income necessary for sustaining their families.”

MAC App. Nos. 554/2010 & conn.

Page 43 of 70

livelihood. At the same time, it cannot be said that no pecuniary loss accrues due to their death. The calculation of loss to the estate, to be awarded as pecuniary damages, is more in the realm of speculation than based on any actual data. In these circumstances, the most appropriate course is to go by the notional income of non-earning persons for which provision was made by the legislature in the Second Schedule appended to the M.V. Act with reference to Section 163-A. That bench-mark was adopted by the tribunal in the case leading to the judgment of Supreme Court in R.K. Malik (supra) wherein the approach was upheld. In these circumstances, the law can be taken as generally well settled that the pecuniary damages in cases of death of children have to be computed with reference to the notional income specified in Second Schedule appended to the M.V. Act. As in Lata Wadhwa (surpa), however, the prospects of employability in future of children in higher age-group necessitate that they are kept at different footing, ideally at least on the bench-mark of minimum wages with room for considering even higher prospective income in case irrefutable evidence is brought forth of exceptionally bright academic record or training in special talent or skill. Of course, the non- pecuniary damages as awarded by the High Court, on which Supreme Court later made further improvement in R.K. Malik (supra), would also need to be added in proper ratio in the final award.

MAC App. Nos. 554/2010 & conn.

Page 44 of 70

MAC App. Nos. 554/2010 & conn.

Page 45 of 70

“53. Considering the current trend of inflation, cost of foodgrains and all other items, Mr P.P. Malhotra, Senior Advocate, Amicus Curiae submitted that for just compensation the multiplier should be enhanced to 24-25 years. Further, according to him, while calculating the compensation, the amount payable towards dependency should be increased as the life expectancy is up to 70-75 years and secondly, after 10 years of earning capacity it should be doubled in view of escalation of cost of living and progressive increase in the income. Keeping in view the cost of living, the Central Government is required to amend the Second Schedule [See Section 163-A(3)]. The Second Schedule was enacted by Act 54 of 1994 w.e.f. 14- 11-1994. Now more than 19 years have passed but no amendment has been made. While the cost of living has gone up manifolds. 54. In view of findings recorded above, we hold that the Second Schedule as was enacted in 1994 has now become redundant, irrational and unworkable due to changed scenario including the present cost of living and current rate of inflation and increased life expectancy. 55. A Letter dated 5-12-2012 issued by the Joint Secretary, Ministry of Road Transport and Highways, New Delhi has been brought to our notice by Mr P.P. Malhotra. Giving reference to the present case therein, the officer has informed that the Motor Vehicles (Amendment) Bill, 2012, inter alia, to amend Section 163- A of the Motor Vehicles Act, 1988 was passed by the Rajya Sabha on 8-5-2012. The said Bill proposes to substitute Section 163-A(3) of the Act by empowering the Central Government to revise the amount or the multiplier specified in the Second Schedule after every three years and furthermore, the Bill also seeks to substitute the Second Schedule so as to provide that for death of non-earning persons, a fixed compensation of Rs

MAC App. Nos. 554/2010 & conn.

Page 46 of 70

1,00,000 for children up to 5 years of age and Rs 1,50,000 for persons more than 5 years of age. It is informed that though the Bill has been passed by the Rajya Sabha it is still pending consideration before the Lok Sabha for its approval. X X X X 57. From the proposed Bill we find that there is a proposal to change the multiplier applicable for different age groups; it does not contemplate schedule structure of compensation. The factors to be considered for working out compensation are (a) age of the victim, (b) multiplier, (c) annual income up to Rs 1,00,000 (the maximum annual income for calculation of compensation will be deemed to be Rs 1,00,000 even if the income exceeds Rs. 1,00,000). Separate provisions have been made for grievous injury and non-grievous injury, etc. 58. The Central Government was bestowed with duties to amend the Second Schedule in view of Section 163-A(3), but it failed to do so for 19 years in spite of repeated observations of this Court. For the reasons recorded above, we deem it proper to issue specific directions to the Central Government through the Secretary, Ministry of Road Transport and Highways to make proper amendments to the Second Schedule table keeping in view the present cost of living, subject to amendment of the Second Schedule as proposed or may be made by Parliament. Accordingly, we direct the Central Government to do so immediately. Till such amendment is made by the Central Government in exercise of power vested under sub-section (3) of Section 163-A of the 1988 Act or amendment is made by Parliament, we hold and direct that for children up to the age of 5 years shall be entitled for a fixed compensation of Rs 1,00,000 (Rupees one lakh) and persons more than 5 years of age shall be entitled for a fixed compensation of Rs 1,50,000 (Rupees

MAC App. Nos. 554/2010 & conn.

Page 47 of 70

one lakh and fifty thousand) or the amount may be determined in terms of the Second Schedule whichever is higher. Such amount is to be paid if any application is filed under Section 163-A of the 1988 Act.”

MAC App. Nos. 554/2010 & conn.

Page 48 of 70

redress grievances according to what is perceived to be principles of justice, equity and good conscience.” 62. The tribunals and courts will have to break free from the groove or strait-jacket of the stale, outdated and obsolete prescription of the second schedule to M.V. Act. Time has come, and it is the obligation of this court to do so, to bring the benchmark in Second Schedule to M.V. Act upto date, in the present matters for purposes of award of compensation in the case of death of children so as to make it “just” and “reasonable”. The issue is about the proper mode of achieving this objective. 63. As noted above, the learned single Judge of this court, sitting in appeal over the judgments of the tribunal in the case of R.K. Malik (supra) while assessing the non-pecuniary damages had improved upon what was granted in Lata Wadhwa (supra) in relation to an accident of 1989 by applying the cost of inflation index notified by the Government of India under Section 48 of the Income Tax Act, 1961. The computation thus made was eventually approved by the Supreme Court, though with further addition towards future prospects. This holds the key to the predicament faced. 64. A similar route was taken by another single bench of this Court in a case for compensation arising out of an incident of terrorism in Kamla Devi v. Govt. of NCT of Delhi 2005 ACJ 216 (Delhi): 114 (2004) DLT 57, wherein the value of the conventional sum awarded in

MAC App. Nos. 554/2010 & conn.

Page 49 of 70

Lata Wadhwa (supra) was improved upon by applying the consumer price index for industrial workers [CPI (IW)]. The view in Kamla Devi (supra) was followed in a number of subsequent decisions of this Court in cases reported as Ashwani Gupta v. Government of India & Ors. 117 (2005) DLT 112; Tasleema v. State (NCT of Delhi) & Ors. ILR (2009) 6 Del 486 : (2009) 161 DLT 660 (DB); Nagrik Sangarsh Samiti & Ors. v. Union of India & Ors. ILR (2010) 4 Del 293 : 2012 ACJ 1548; Swarn Singh v. Union of India 2010 SCC Online Del 1190 and Ashok Sharma & Ors. v. Union of India & Ors. ILR (2008) 1 Del 96 : 2009 ACJ 1063. 65. Having regard to the fluctuating trends in CPI (IW), this court finds the Cost Inflation Index (CII) determined and notified by the Ministry of Finance in Government of India under Section 48 of Income Tax Act, 1961 for each financial year, to be a better method to off-set the effect of inflation on the real value of money. This approach, if followed, would ensure that there is no inconsistency in the awards of compensation in cases of death of children. [R.K.Malik (supra) and Balram Prasad v. Kumar Saha (2014) 1 SCC 384]. Since the amount which requires to be subjected to correction was determined by decision in R.K.Malik wherein cause of action had arisen on 10.11.1997, the financial year 1997-98 is taken as the “base year”.

MAC App. Nos. 554/2010 & conn.

Page 50 of 70

Financial Year CII Before 1/4/1981 100 2004-05 480 2005-06 497 1981-82 100 2006-07 519 1982-1983 109 2007-08 551 X X X X X X 2008-09 582 1997-98 331 2009-10 632 1998-99 351 2010-11 711 1999-2000 389 2011-12 785 2000-01 406 2012-13 852 2001-02 426 2013-14 939 2002-03 447 2014-15 1024 2003-04 463 2015-16 1081

CONCLUSIONS 67. In the considered view of this Court, the cases for compensation on account of death of children in motor vehicular accident cases ought to be dealt with by considering the claim towards pecuniary damages (towards loss to estate), in accordance with the age-group wise categories as in R.K.Malik (supra); the first category being of children less than 10 years‟ in age, the second category being of children more than 10 years‟ and up to 15 years‟ in age, and the third category of children more than 15 years‟ but not having attained the

MAC App. Nos. 554/2010 & conn.

Page 51 of 70

age of majority (18 years). The children in the third category would ordinarily be of such age group as is generally receiving formal school education or those that are (being) imparted special training so as to be equipped with requisite skills to be gainfully employed in a variety of trades. They are after all nearing adulthood and thus, on the threshold of becoming self-reliant. In such cases, the prospects of their employability and earnings in future or present, based on evidence adduced about their academic track record or training in special talents or skills, would need to be borne in mind. As in Lata Wadhwa (supra), the claim for pecuniary damages arising out of death of children of this age group cannot be at par with the lower age groups falling in the first and second category. Therefore, the pecuniary loss to estate due to their death would deserve to be worked out by applying a higher multiplier on the notional income (of non-earning persons) unless, of course, case is properly made out for higher considerations. Noticeably, in Sarla Verma (supra) the Supreme Court specified the multiplier of 18 for cases where the deceased was in the age-group of 15 years‟ to 20 years‟ old. For the first and second category, however, the multiplier of 10 and 15 respectively, as used in R.K. Malik (supra), would hold good. 68. Since in the claims arising out of death of children, generally speaking, (non-earning hands), the income is to be notionally assumed on the basis of the second schedule to the MV Act, the general practice

MAC App. Nos. 554/2010 & conn.

Page 52 of 70

of deduction of one-half (50%) towards personal & living expenses, as applied in case of bachelors above the age of 18 years would be unfair. Pertinently, the notional income specified for non-earning persons in the second schedule is very low as compared to the rates of minimum wages. Therefore, the deduction of one-third (1/3rd) on this account, as provided by the first note below the second schedule would only be appropriate. 69. The award of compensation must necessarily take into account non-pecuniary damages. In R.K. Malik (supra), ₹75,000/- awarded by this Court as the “conventional compensation” was enhanced by the Supreme Court by further similar amount (₹75,000/-) as the “compensation for future prospects”. For the reasons set out earlier, in the context of pecuniary loss to estate, the composite sum of non- pecuniary damages of ₹1,50,000/- [as awarded in R.K. Malik (supra)] would deservedly be added, but with suitable correction so as to ensure that the deficiency in the real value of money is made good. As noted (in para 46) earlier, the Supreme Court justified the addition of `75,000/- towards compensation for “future prospects” by noting that the said amount was “roughly half of the amount given on account of pecuniary damages”. Since the court had also upheld the award of similar sum (`75,000/-) by this court as “conventional compensation”, both amounts of non-pecuniary damages, put together, account for roughly an amount equivalent to the sum computed as pecuniary loss

MAC App. Nos. 554/2010 & conn.

Page 53 of 70

to estate. Thus, this court is of the view that a composite sum equal to the amount computed as pecuniary loss to estate may be added as non- pecuniary damages (inclusive of conventional compensation and for future prospects), in such cases as at hand to arrive at the appropriate figure of „just compensation‟. 70. It has been noticed by this Court that the tribunals have been assessing the compensation and awarding it to the last rupee, at times even in the fraction of a rupee, not bothering to follow the practice of rounding off. Awards in at least two of the cases from which the appeals at hand arise provide ready illustration. This seems to be not correct. It must be added here that human misery cannot be calculated with such mathematical precision. Even otherwise for convenience of accounting, it is desirable that the amount of award is rounded off to the nearest (if not next) thousands of rupees. 71. Subject to all other requisite conditions being fulfilled, for the foregoing reasons, in order to bring about consistency and uniformity in approach to the issue, it is held that claims for compensation on account of death of children shall be determined as follows : (i). Till such time as the law is amended by the legislature, or the Central Government notifies the amendment to the Second Schedule in exercise of the enabling power vested in it by Section 163-A (3) of the

MAC App. Nos. 554/2010 & conn.

Page 54 of 70

Motor Vehicles Act, 1988, and except in cases wherein the prospects of employability and earnings (in future or present) of the deceased child are proved by cogent and irrefutable evidence, this having regard, inter alia, to the academic record or training in special talents or skills, for computing the pecuniary damages on account of the loss to estate, the notional income of non-earning persons (`15000/- p.a.) as specified in the Second Schedule (brought in force from 14.11.1994), shall be assumed to be the income of the deceased child, and taken into account after it is inflation- corrected with the help of Cost Inflation Index (CII) as notified by the Government of India from year to year under Section 48 of the Income Tax Act, 1961, by applying the formula indicated hereinafter. (ii) For inflation-correction, the financial year of 1997- 1998 shall be treated as the “base year” and the value of the notional income relevant to the date of cause of action shall be computed in the following manner :- ` 15,000/- x A ÷331 [wherein the figure of „`15,000/-‟ represents the notional income specified in the second schedule requiring inflation-correction; „A‟ represents the CII for the financial year in which the cause of action arose (i.e. the accident / death occurred); and the figure of „331‟ represents the CII for the „base year‟]

MAC App. Nos. 554/2010 & conn.

Page 55 of 70

(iii). After arriving at an appropriate figure of the present equivalent value of the notional income (i.e. inflation- corrected amount), it shall be rounded off to a figure in next thousands of rupees. (iv). The amount of notional income thus calculated shall be reduced to two-third, the deduction to the extent of one- third being towards personal & living expenses of the deceased, the balance taken as the annual loss to estate (hereinafter also referred to as “the multiplicand”). (v). For assessment of the pecuniary damages on account of the death of children upto the age of 10 years, the loss to estate shall be calculated, capitalizing the multiplicand, by applying the multiplier of ten (10). (vi). For children of the age-group of more than 10 years upto 15 years, the loss to estate shall be calculated by applying the multiplier of fifteen (15). (vii). For children of the age-group of more than 15 years but less than 18 years, the loss to estate shall be calculated by applying the multiplier of eighteen (18). (viii). After the pecuniary loss to estate has been worked out in the manner indicated above, an amount equivalent to the amount thus computed shall be added to it as the composite non-pecuniary damages taking care of not only

MAC App. Nos. 554/2010 & conn.

Page 56 of 70

the conventional heads but also towards future prospects as awarded in R.K. Malik v. Kiran Pal (2009) 14 SCC 1. (ix). The final sum thus arrived at, appropriately rounded off, if so required to the nearest (if not next) thousands of rupees, shall be awarded as compensation for the death of the child. 72. The ruling in National Insurance Company Ltd. v. Farzana (2009 ACJ 2763) was rendered by a learned single Judge of this Court on 14.07.2009. Though it had built upon the dispensation in R.K.Malik (supra), given the effect of inflation elaborately discussed above, it has outlived its utility for cases relating to later years. At the same time, it must be noted, that the view in Farzana (supra) has governed the field till date, inasmuch as it has been followed by other single benches of this Court as also by tribunals in various cases. Given the modified method of calculation as is being determined by this judgment, it is possible that in some of the earlier decided cases, the compensation computed on revised lines may fall below the amount of ₹3,75,000/- computed in Farzana (supra). Since the awards in such earlier decided cases were granted with reference to the ratio in Farzana (supra), it will not be fair to order any modification in cases that relate to the period on or after 10.05.2000 (the date of cause of action in Farzana) so as to reduce the awards below the said amount of ₹3,75,000/-, particularly as some of such awards may already have been satisfied, including on account of interim orders of this Court.

MAC App. Nos. 554/2010 & conn.

Page 57 of 70

CASE-WISE DECISIONS

Case ‘A’ : MAC Appeal Nos. 226/2010 & 554/2010 (In re: death of three months‟ old child Rama Kant)

MAC App. Nos. 554/2010 & conn.

Page 58 of 70

(1) SCR 872. The plea regarding driving license was rejected with observation that the insurer had failed to adduce any evidence in such regard. Though in the operative part (para 25) of its judgment, the tribunal directed the insurer to pay the awarded compensation, Chetan

MAC App. Nos. 554/2010 & conn.

Page 59 of 70

Malhotra by his appeal (MAC Appeal No. 554/2010) has taken exception to the observation in the opening line in the said very para of the impugned judgment holding the liability of the insurer “to be joint and several with other respondents”. 79. Since no breach of terms and conditions of the insurance policy was proved, though Chetan Malhotra (owner) is held vicariously liable, no responsibility to pay can be fastened on him as the insurer is bound to indemnify. With this clarification, no further direction is required on the appeal of Chetan Malhotra.

Case ‘B’ : MAC Appeal No. 580/2007 (in re: death of seven years‟ old child Yash Chouhan)

MAC App. Nos. 554/2010 & conn.

Page 60 of 70

MAC App. Nos. 554/2010 & conn.

Page 61 of 70

x 2/3 x 15) ₹2,49,999/- rounded off to ₹2,50,000/-. Adding the similar amount towards composite non-pecuniary damages, the total compensation payable in this case comes to ₹5,00,000/-. Following the reasons set out in the context of the preceding cases, the rate of interest is increased to 9% p.a. 83. By order dated 15.03.2013, the insurer had been directed to deposit 80% of the awarded amount with accrued interest with the Registrar General and on such deposit, 40% was allowed to be released, the balance kept in fixed deposit receipt with UCO Bank, Delhi High Court branch. The Registrar General shall calculate the amount payable to the claimants in this case in terms of the modified award and release the same, refunding the excess to the insurer. Case ‘D’ : MAC Appeal No. 510/2014 (In re: death of 17 years‟ old child Mohit)

MAC App. Nos. 554/2010 & conn.

Page 62 of 70

total compensation payable in the case is calculated as (₹3,24,000/- x 2) ₹6,48,000/-. Needless to add, it shall carry interest as levied (9%) by the tribunal. 85. The award is reduced accordingly. 86. In terms of order dated 04.07.2014, the insurance company had deposited the entire awarded amount with interest with the Registrar General who was permitted to release 50%, the rest being kept in fixed deposit receipt with UCO Bank, Delhi High Court branch. The Registrar General shall calculate the amount payable to the claimants in this case in terms of the modified award and release the same, refunding the excess to the insurer.

Case ‘E’ : MAC Appeal No. 1106/2013 (In re: death of four years‟ old child Vishal)

MAC App. Nos. 554/2010 & conn.

Page 63 of 70

compensation in the case comes to (₹180,000/- x 2) ₹3,60,000/-. But, in view of the decision in paragraph 73 (supra), the amount of compensation is reduced to ₹3,75,000/-. Following the dispensation in earlier cases, the rate of interest is increased to 9% per annum. 88. By order dated 03.12.2013, the insurance company had been directed to deposit the entire awarded amount with up-to-date interest with the Registrar General, out of which 60% was allowed to be released, the balance kept in fixed deposit receipt with UCO Bank, Delhi High Court branch. The Registrar General shall calculate the amount payable to the claimants in this case in terms of the modified award and release the same, refunding the excess to the insurer. If excess has been released, the same shall be liable to be refunded.

Case ‘F’ : MAC Appeal Nos. 1288/2012 & 881/2015 (In re: death of sixteen years‟ old Seema Kumari)

MAC App. Nos. 554/2010 & conn.

Page 64 of 70

expenses, the total compensation payable in this case would be (₹3,24,000/- x 2 + 6,000/-) ₹6,54,000/-. It shall carry interest as levied (9%) by the tribunal. 90. By order dated 08.12.2012 in MACA 1288/2012, the insurance company had been directed to deposit 75% of the awarded amount with the tribunal within the period specified whereupon such deposited amount was directed to be kept in fixed deposit receipt. The amount thus deposited shall now be released to the claimants. The insurance company shall deposit balance of its liability in terms of the modified award with the tribunal within 30 days for being released to the claimants.

Case ‘G’ : MAC Appeal No.175/2014 (In re: death of seventeen years‟ old child Hussain Haider)

MAC App. Nos. 554/2010 & conn.

Page 65 of 70

compensation is accordingly enhanced. It shall carry interest as levied by the tribunal. The balance lying in deposit made by the insurer in terms of the interim order shall be released to the claimants. The insurer shall deposit the balance of its liability under the modified award with the tribunal within 30 days of this judgment making it available to be released to the claimants. Case ‘H’ : MAC Appeal No. 729/2013 (In re: death of three years‟ old Varsha)

MAC App. Nos. 554/2010 & conn.

Page 66 of 70

respondent Hari (i.e. the father of the deceased child) died on 10.04.2013. Though his father (Achoo) was substituted in his place, given the background facts, no portion of the amount deserves to be granted to him. The entire awarded amount shall, thus, be released in favour of the second respondent Jayanti (mother of the deceased child). The Registrar General shall take necessary steps in this regard. The insurance company will deposit the balance of its liability under the modified award with the tribunal within 30 days of this judgment making it available for it to be released to the said claimant. Case ‘I’ : MAC Appeal No. 421/2015 (In re: death of fourteen years‟ old Raju)

MAC App. Nos. 554/2010 & conn.

Page 67 of 70

Case ‘J’ : MAC Appeal No.100/2013 (In re: death of seventeen years‟ old Mohd. Asif)

Case ‘K’ : MAC Appeal No.564/2014 (In re: death of 10 years‟ old child Rishabh Garg)

MAC App. Nos. 554/2010 & conn.

Page 68 of 70

sum of ₹63,527/-, the compensation in this case is computed as (₹2,40,000/- x 2 + 63,527/-) ₹5,43,527/-, rounded off to ₹5,44,000/-. 97. The insurance company had been directed by order dated 23.07.2014, to deposit the entire awarded amount with interest with the Registrar General within the period specified and from such deposit ₹4,00,000/- was released in equal proportions to the two claimants, the balance kept in appropriate fixed deposit. The Registrar General shall now calculate the amount payable to the claimants under the modified award and release the balance to them, refunding the excess to the insurance company. Case ‘L’ : MAC Appeal No.956/2014 (In re: death of eleven years‟ old child Master Gautam Joshi) 98. The death occurred on 02.10.2011 and therefore, the CII for the financial year 2011-2012 (i.e. 785) would apply. The notional income comes to Rs.15,000 x 785 / 331 = Rs.35,575/- rounded off to Rs.36,000/-. Since the age of the deceased child was 11 years, the multiplier of 15 applies. Deducting 1/3rd towards personal and living expenses, the total pecuniary loss to estate is computed as (Rs.36,000 x 2/3 x 15) Rs.3,60,000/-. Adding similar amount towards composite non-pecuniary damages, the total compensation in the case comes to Rs.7,20,000/-. The compensation is enhanced accordingly. Following the view taken in the cases decided above, the rate of interest is enhanced to 9% p.a. from the date of the petition till realization. The

MAC App. Nos. 554/2010 & conn.

Page 69 of 70

insurer is directed to deposit the requisite amount under the enhanced award and on account of increased rate of interest with the tribunal within 30 days so that it can be released forthwith to the claimants. Case ‘M’ : MAC Appeal No. 1187/2014 (In re: death of fourteen years‟ old Bhanu @ Bhanu Kataria)

MAC App. Nos. 554/2010 & conn.

Page 70 of 70

child was 4 years old, the multiplier of 10 would apply. After deducting 1/3rd towards personal and living expenses, the pecuniary loss to estate is calculated as (₹39,000/- x 2 / 3 x 10) ₹2,60,000/-. Adding similar amount towards composite non-pecuniary damages, the total compensation in this case calculated as (₹2,60,000/- x 2) ₹5,20,000/-. Following the directions in the earlier cases, the award in this case shall also carry interest at the rate of 9% p.a. 101. The insurance company shall be obliged to deposit the requisite amount with the tribunal within 30 days for it to be released to the claimants. 102. The statutory amounts, if deposited, in above appeals, shall be refunded after the Registry has recorded satisfaction that the directions have been complied with. 103. The appeals and the pending applications stand disposed of in above terms. 104. It is directed that a copy of this judgment shall be circulated to the presiding officers of Motor Accident Claims Tribunals of Delhi for information.

R.K. GAUBA (JUDGE) MAY 13, 2016 nk/VLD/yg