Dismissed

National Insurance Co. Ltd. v. Rajendra Singh and 6 Others

Allahabad HC14 Dec 2017FAFO/4025/2017

Case brief

AI extract

What is this about?

In an appeal against a motor accident compensation award, the court rejected the appellant's argument that notional income could not be assessed for a housewife or that claimants need to prove dependency. The court dismissed the appeal, holding the award was not excessive.

What did the court decide?

The appeal was dismissed; the deposited amount was remitted to the Court below.

National Insurance Co. Ltd. Vs Rajendra Singh and 6 Others — Cheque Dishonour | Allahabad HC (2017)

AFR

Court No. - 34

Case :- FIRST APPEAL FROM ORDER No. - 4025 of 2017

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Appellant :- National Insurance Co. Ltd. Respondent :- Rajendra Singh & 6 Others Counsel for Appellant :- Anand Kumar Sinha

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Hon'ble Sudhir Agarwal, J. Hon'ble Ajit Kumar, J.

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Heard Sri A.K. Sinha, learned counsel for appellant and perused the record.

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This appeal under under Section 173 of Motor Vehicles Act, 1988 (hereinafter referred to as “Act, 1988”) has arisen from judgment and award dated 06.09.2017 passed by Sri Sanjay Kumar Verma, Motor Accident Claims Tribunal/Additional District and Sessions Judge, Court No. 3, Azamgarh in Motor Accident Claim Petition No. 180 of 2015 awarding compensation of Rs. 5,46,500/with 7 per cent holding the appellant-Insurance Company to pay awarded amount of compensation to claimants-respondents with right to recover the said amount from owner of vehicle. Assailing the said award, learned counsel for appellant-Insurance Company contended that the deceased was house wife and therefore had no income at all. Her notional income has been assessed which cannot be said to be established income in the light of Constitution Bench judgment in National Insurance Company Limited Vs. Pranay Sethi and others 2017 (13) SCALE 12 , therefore, unless the income is established and proved, notional income in respect to house wife ought not to have been taken into consideration and in any case future prospects to the extent of 50 per cent has been wrongly applied inasmuch at the best it could have been 25 per cent treating deceased as self employed. Thirdly it is contended that claimants are not dependent and therefore compensation is excessive.

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However, we find no force in any of the submissions.

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The gamut of argument of learned counsel for appellant in respect to income of house wife is that she cannot be said to be employed or has any income from employment and, therefore, no notional income of a house wife could have been assessed and she should be treated to be a non earning person. The argument suggests a clear gender bias against women and is in the teeth of mandate against discrimination on the ground of mere sex provided under Article 15(1) of Constitution.

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A similar argument, we find was advanced before Supreme Court in Arun Kumar Agrawal and Anr. Vs. National Insurance Company and others (2010) 9 SCC 218 but has been repelled with strong observations. That was also a judgment went from this Court to the Highest Court and question up for consideration before Apex Court was income need to be assessed in respect to Smt. Renu Agrawal, a house wife, died in a road accident, leaving behind husband and a daughter. Relevant observations made by Court in Para 22, 26 and 27 are reproduced as under:

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“ 22. We may now deal with the question formulated in the opening paragraph of this judgment. In Kemp and Kemp on Quantum of Damages, (Special Edition - 1986), the authors have identified various heads under which the husband can claim compensation on the death of his wife. These include loss of the wife's contribution to the household from her earnings, the additional expenses incurred or likely to be incurred by having the household run by a house-keeper or servant, instead of the wife, the expenses incurred in buying clothes for the children instead of having them made by the wife, and similarly having his own clothes mended or stitched elsewhere than by his wife, and the loss of that element of security provided to the husband where his employment was insecure or his health was bad and where the wife could go out and work for a living.”

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“26. In India the Courts have recognised that the contribution made by the wife to the house is invaluable and cannot be computed in terms of money. The gratuitous services rendered by wife with true love and affection to the children and her husband and managing the household affairs cannot be equated with the services rendered by others. A wife/mother does not work by the clock. She is in the constant attendance of the family throughout the day and night unless she is employed and is required to attend the employer's work for particular hours. She takes care of all the requirements of husband and children including cooking of food, washing of clothes, etc. She teaches small children and provides invaluable guidance to them for their future life. A housekeeper or maidservant can do the household work, such as cooking food, washing clothes and utensils, keeping the house clean etc., but she can never be a substitute for a wife/mother who renders selfless service to her husband and children.

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27 . It is not possible to quantify any amount in lieu of the services rendered by the wife/mother to the family i.e. husband and children. However, for the purpose of award of compensation to the dependents, some pecuniary estimate has to be made of the services of housewife/mother. In that context, the term 'services' is required to be given a broad meaning and must be construed by taking into account the loss of personal care and attention given by the deceased to her children as a mother and to her husband as a wife. They are entitled to adequate compensation in lieu of the loss of gratuitous services rendered by the deceased. The amount payable to the dependants cannot be diminished on the ground that some close relation like a grandmother may volunteer to render some of the services to the family which the deceased was giving

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earlier.”

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Thereafter, in para-35 and 36, Court said:

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“ 35. In our view, it is highly unfair, unjust and inappropriate to compute the compensation payable to the dependents of a deceased wife/mother, who does not have regular income, by comparing her services with that of a housekeeper or a servant or an employee, who works for a fixed period. The gratuitous services rendered by 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 non-earning person at Rs. 15,000/- per annum and in case of a spouse, 1/3^rd income of the earning/surviving spouse for the purpose of computing the compensation.

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36. Though, Section 163A does not, in terms apply to the cases in which claim for compensation is filed under Section 166 of the Act, in the absence of any other definite criteria for determination of compensation payable to the dependents of a non-earning housewife/mother, it would be reasonable to rely upon the criteria specified in Clause (6) of the Second Schedule and then apply appropriate multiplier keeping in view the judgments of this Court in General Manager Kerala State Road Transport Corporation v. Susamma Thomas (Mrs.) and Ors. (supra); U.P. S.R.T.C. v. Trilok Chandra (supra); Sarla Verma (Smt.) and Ors. v. Delhi Transport Corporation and Anr. (supra) and also take guidance from the judgment in Lata Wadhwa's case. The approach adopted by different Benches of

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Delhi High Court to compute the compensation by relying upon the minimum wages payable to a skilled worker does not commend our approval because it is most unrealistic to compare the gratuitous services of the housewife/mother with work of a skilled worker.”

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In the concurring judgment, Justice A.K. Ganguly has also observed in para 57, 60, 62 and 63 as under:

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“57 . Various aspects of the nature of homemaker's job have been described in para 11 which are very relevant and are extracted below:

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11. The role of a housewife includes managing budgets, co-ordinating activities, balancing accounts, helping children with education, managing help at home, nursing care etc. One formula that has been arrived at determines the value of the housewife as, Value of housewife = husband's income - wife's income + value of husband's household services, which means the wife's value will increase inversely proportionate to the extent of participation by the husband in the household duties. The Australian Family Property Law provides that while distributing properties in matrimonial matters, for instance, one has to factor in "the contribution made by a party to the marriage to the welfare of the family constituted by the parties to the marriage and any children of the marriage, including any contribution made in the capacity of a homemaker or parent.”

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“60 . … Admittedly, it has to be recognized that the services produced in the home by the women for other members of the household are an important and valuable form of production. It is possible to put monetary value to these services as for instance, the monetary value of cooking for family members

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could be assessed in terms of what it would cost to hire a cook or to purchase ready cooked food or by assessing how much money could be earned if the food cooked for the family were to be sold in the locality.”

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“62. The Alternative to imputing money values is to measure the time taken to produce these services and compare these with the time that is taken to produce goods and services which are commercially viable. One has to admit that in the long run, the services rendered by women in the household sustain a supply of labour to the economy and keep human societies going by weaving the social fabric and keeping it in good repair. If we take these services for granted and do not attach any value to this, this may escalate the unforeseen costs in terms of deterioration of both human capabilities and social fabric.

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63. Household work performed by women throughout India is more than US $ 612.8 billion per year (Evangelical Social Action Forum and Health Bridge, page 17). We often forget that the time spent by women in doing household work as homemakers is the time which they can devote to paid work or to their education. This lack of sensitiveness and recognition of their work mainly contributes to women's high rate of poverty and their consequential oppression in society, as well as various physical, social and psychological problems. The courts and tribunals should do well to factor these considerations in assessing compensation for housewives who are victims of road accident and quantifying the amount in the name of fixing “just compensation”.”

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In Jitendra Khimshankar Trivedi and others Vs. Kasam Daud Kumbhar and Ors. (2015) 4 SCC 237 , recognizing importance of working of a house wife as a Home Maker, Court said:

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“...the fact remains that she was a housewife and a home

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maker. It is hard to monetize the domestic work done by a house-mother. The services of the mother/wife is available 24 hours and her duties are never fixed. Courts have recognized the contribution made by the wife to the house is invaluable and that it cannot be computed in terms of money. A housewife/home-maker does not work by the clock and she is in constant attendance of the family throughout and such services rendered by the home maker has to be necessarily kept in view while calculating the loss of dependency. Thus even otherwise, taking deceased Jayvantiben Jitendra Trivedi as the home maker, it is reasonable to fix her income at Rs. 3,000/- per month.”

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We have also gone through entire judgment of Constitution Bench in National Insurance Company Limited Vs. Pranay Sethi and others (supra) and find nothing therein so as to read that notional income of housewife, if not separately proved, cannot be assessed and reliance placed on the said judgment in this regard is clearly incorrect. Issue referred to Constitution Bench was different and therefore on the aspect on which we are addressed by appellant we find no otherwise law laid down by Constitution Bench in the above judgment.

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Now coming to third question, we find that the claim under Section 166 can be lodged by 'heirs' and 'legal representatives' of the victim in case of death. It does not talk of 'dependents'. The term “legal representative” has not been defined in Act, 1988 and we may look into the definition of “legal representative” in Section 2(11) of Code of Civil Procedure .

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In Smt. Manjuri Bera Vs. The Oriental Insurance Company Ltd. and another AIR 2007 SC 1474 Court held that under Section 2(11) CPC, "legal representative" means a person who in law represents the estate of deceased person and includes any person who

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inter-meddles with the estate of deceased and where a party sues or is sued in a representative character, the person to whom estate devolves on the death of party so suing or sued.

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The claim for compensation is not dependent on the question whether Legal Representatives are financially dependent upon victim or not. The just compensation is determined for the loss sustained by “Legal Representatives” in terms of dependency and others factors like loss of love, affection, care etc. Similar argument was also negatived by this Court in Oriental Insurance Co. Ltd. Vs. Nirmala Devi and others 2016 (11) ADJ 560 . Following judgment in Montford Brothers of St. Gabriel and another Vs. United India Insurance and another (2014) 3 SCC 394 , this Court held that Legal Representatives even if not dependent upon deceased, who expired due to motor accident, is entitled to compensation under Act, 1988. Claim Petition under Section 166, irrespective of dependency upon income of deceased, is maintainable. A similar argument was also rejected by another Division Bench in Shriram General Insurance Company Ltd. Vs. Sangeeta Srivastava and others 2016 (6) ADJ 645.

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Moreover, even otherwise the argument that none of the claimants was dependent, and, therefore, compensation could not have been awarded is fallacious. Claimant left four children and husband. One son Arun Singh was minor. All being family members, depend in various ways upon deceased house wife and submission that they were not dependent ignores very concept of house wife/house maker who is engaged in every household work, plans and thoughts of caring of family and every work of life of members of family depends upon house wife/house maker. Other family members depend largely in every way i.e. almost in every aspect relating to house hold work. Therefore, the basic premise that none of the claimants is dependent is incorrect and has no foundation at all.

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Even otherwise, maintainability of Claim Petition under Section 166 is not dependent on the fact that claimants must be a dependent on the deceased in respect to his/her income. 15. Now coming to the second aspect that future prospects 50 per cent should not have been applied and at the best it could have been 25 per cent in view of Constitution Bench judgment in National Insurance Company Limited Vs. Pranay Sethi (supra), we find from record that even if argument of appellant is accepted, it would have made a difference of Rs. 74,250/- but then under the heads of “loss of love”, 'affection', 'consortium' and 'funeral expenses', Tribunal has awarded only Rs. 20,000/- though Constitution Bench judgment provides a total 70 thousand Rupees. Therefore, effective difference would be around 24,000/- and odd. Simultaneously we also find that Tribunal has awarded only seven per cent interest which is on lower side. Rate of interest is no more res integra. In Neeta Vs The Divisional Manager, MSRTC (2015) 3 SCC 590 where accident took place on 22.03.2011, Court allowed 9% rate of interest and held that interest awarded by Tribunal at 8% was erroneous. Para-11 of the judgment reads as under:

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"The appellants are also entitled to the interest on the compensation awarded by this Court in these appeals at the rate of 9% per annum along with the amount under the different heads as indicated above. The Courts below have erred in awarding the interest at the rate of 8 % per annum on the compensation awarded by them to the Appellants without following the decision of this Court in Municipal Corporation of Delhi, Delhi Vs. Uphaar Tragedy Victims Association and Ors. (2011) 14SCC 481. Accordingly, we award the interest at the rate of 9% per annum on the compensation determined in these appeals from the date of filing of the application till the date of payment."

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In Kanhsingh Vs. Tukaram, 2015 (1) SCALE 366 where accident had taken place on 02.07.2006 but tribunal awarded no interest, Court held that this is erroneous and 9 % interest should have been allowed in view of the principles laid down in Municipal Corporation of Delhi Vs Association of Victims of Uphaar Tragedy 2011(14) SCC 481 .

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In Kalpanaraj and Others Vs Tamil Nadu State Transport Corporation (2015) 2 SCC where accident took place on or before 1994, High Court had awarded interest at the rate of 9% per annum which was challenged that it is on higher side. Court upheld said rate of interest.

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In Shashikala and Others Vs Gangalakshmamma and Another (2015) 9 SCC 150 , where accident had taken place on 14.12.2006, Court allowed 9% rate of interest from the date of claim petition till the date of realization.

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In Asha Verman and Ors Vs Maharaj Singh & Ors, 2015 (4) SCALE 329 , High Court awarded interest at the rate of 8%. Accident took place on 27.11.2016. It was held that 8% interest is on lower side and it should be 9%.

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In Surit Gupta Vs United India Insurance Company (2015) 11 SCC 457 , accident took place in July, 1990. Punjab and Haryana High Court had awarded interest at the rate of 6%. Court held that it is on lower side and it should be 9%.

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In Chanderi Devi and another Vs Jaspal Singh and others (2015) 11 SCC 703 , date of accident is September 2006 and the incumbent died on 04.10.2006. Court awarded 9% interest.

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In Jitendra Khimshankar Trivedi Vs Kasam Daud Kumbhar and Others (2015) 4 SCC 237 , incident was of 21.09.1990. Tribunal awarded 15 % interest which was reduced to 12% by Gujrat High Court. Court held that it is on higher side and awarded 9% interest following its decisions in Amresh Kumari Vs

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Niranjan Lal Jagdish Parshad Jain 2010 ACJ 551 (SC) and Mohinder Kaur Vs Hira Nand Sindhi (2007) ACJ 2123 (SC) . 23. Therefore, in totality of facts and circumstances, we find that the compensation awarded by Tribunal cannot be said to be excessive or unjust so as to warrant a decree of reversal in this appeal.

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The Appeal is accordingly dismissed at the stage of hearing under Order 41 Rule 11 C.P.C.

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The amount already deposited at the time of filing this appeal shall be remitted to Court below forthwith.

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Dt. 14.12.2017 PS

National Insurance Co. Ltd. v. Rajendra Singh and 6 Others

Case brief

What is this about?

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National Insurance Co. Ltd. v. Rajendra Singh and 6 Others

Case brief

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