Partly allowed

Honnappa S/O Somanna Nayak v. Raju Bhika Marathe

Karnataka HC23 Nov 2023MFA/102018/2017

Case brief

AI extract

What is this about?

The High Court allowed the appeal in part, holding that while claimants were not dependents of the deceased, they are entitled to compensation for loss of estate. The court modified the tribunal's award from Rs.50,000 to approximately Rs.11,00,000 based on a 25% savings rate and added loss of consortium and funeral expenses.

What did the court decide?

Enhanced compensation of Rs.10,99,588.50 granted, including loss of estate, loss of consortium, and funeral expenses, with interest at 6% p.a.

Honnappa S/O Somanna Nayak Vs Raju Bhika Marathe — Motor Accident Claims | Karnataka HC (2023)

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IN THE HIGH COURT OF KARNATAKA, DHARWAD BENCH

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DATED THIS THE 23^RD DAY OF NOVEMBER, 2023

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PRESENT

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THE HON'BLE MR JUSTICE S.SUNIL DUTT YADAV

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AND

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THE HON'BLE MR JUSTICE VIJAYKUMAR A.PATIL MISCELLANEOUS FIRST APPEAL NO. 102018 OF 2017 (MV)

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BETWEEN:

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HONNAPPA S/O. SOMANNA NAYAK, AGE: 69 YEARS, OCC: AGRICULTURE,

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SMT. PREMA W/O. HONNAPPA NAYAK, AGE: 55 YEARS, OCC: HOUSEHOLD,

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RAGHAVENDRA S/O. HONNAPPA NAYAK, AGE: 28 YEARS, OCC: AGRICULTURE, ALL ARE R/O: HOSKERI, TQ: ANKOLA, DIST: KARWAR-581314.

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Digitally signed by VINAYAKA VINAYAKA B V B V Date: 2023.12.02 11:33:36 +0530

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APPELLANTS

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(BY SRI. SHIVAKUMAR S. BADAWADAGI, ADVOCATE)

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AND:

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RAJU BHIKA MARATHE, AGE: MKAJOR, OCC: OWNER CAR BEARING NO.KA-30/Q-3528, R/O: D-119, KAIGA TOWNSHIP, PO. MALLAPUR, KARWAR-581301.

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THE MANAGER, ICICI LOMBARD GENERAL INSURANCE, BRANCH OFFICE, ZENTH HOUSE, KESHAVARAO KHADYE MARG, MAHALAXMI, MUMBAI-400019.

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SHRIDHAR GOVIND NAYAK, AGE: 40 YEARS, OCC: SERVICE, R/O: CHIKKAMAVALLI, KANNIGERI, TQ: YELLAPUR, DIST: KARWAR-581359.

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THE MANAGER, NEW INDIA INSURANCE CO. LTD., 1ST FLOOR, JANAKI PLAZA, PIKLE ROAD, KARWAR, DIST: KARWAR-581301.

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RESPONDENTS (BY SRI. NAGARAJ C. KOLLOORI, ADVOCATE FOR R2, SRI. S.S. KOLIWAD, ADVOCATE FOR R4, NOTICE TO R1 DISPENSED WITH, NOTICE TO R3 IS SERVED)

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THIS MISCELLANEOUS FIRST APPEAL IS FILED U/S. 173(1) OF MOTOR VEHICLES ACT, AGAINST THE JUDGMENT AND AWARD DATED 10.11.2016 PASSED IN MVC NO. 66/2012 ON THE FILE OF THE ADDITIONAL MOTOR ACCIDENT CLAIMS TRIBUNAL, KUMTA ITINERARY SITTING AT ANKOLA PARTLY ALLOWING THE CLAIM PETITION FOR COMPENSATION AND SEEKING ENHANCEMENT OF COMPENSATION & ETC.

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THIS MISCELLANEOUS FIRST APPEAL, COMING ON FOR ADMISSION, THIS DAY, VIJAYKUMAR A.PATIL J., DELIVERED THE FOLLOWING:

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JUDGMENT

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This appeal is by the claimants being aggrieved by the judgment and award dated 10.11.2016 passed by the learned Addl. M.A.C.T., Kumta, itinerary sitting at Ankola (for short ‘The Tribunal’) in M.V.C. No. 66/2012 whereby the Tribunal has allowed the claim petition in part holding that the claimant no.3, i.e., the brother of the deceased, is not entitled for any compensation and the claimants no.1 and 2 who are the father and mother of the deceased are entitled to receive a fixed sum of Rs.50,000/- under Section 140 of the Motor Vehicles Act, 1988.

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Brief facts leading to filing of the appeal are as under:

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On 05.09.2011 when Shwetha Honnappa Nayak, i.e., the deceased, was proceeding with her husband, i.e., respondent no.3, on his motorcycle bearing reg. no. KA-31-Q-1384 as a pillion rider on NH-13, a car bearing reg. no. KA-30-M-3528 driven by its driver came from opposite direction in a rash and negligent manner and dashed the motorcycle. Due to the impact, Shwetha Honnappa Nayak sustained grievous injuries and succumbed to those injuries. Parents of the deceased along with her brother have filed a claim petition before the

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Tribunal seeking compensation. The respondents have filed their separate objections statements. The respondent No.1 has denied that he was rash and negligent in driving the car. Respondent No.2 has denied the averments made in the claim petition contending that the driver of the car was not negligent and it is the rider of the motorcycle was negligent which has resulted in the accident. They have denied the age, avocation and income of the deceased. It is averred that the claimants cannot be considered as dependents of the deceased as the deceased was married and residing with the third respondenthusband. They sought for dismissal of the claim petition.

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The Tribunal framed issues and recorded evidence of the parties. Claimant no.1 examined himself as PW1, examined another witness as PW2 and got marked Exs.P1 to P.9. The respondent-Insurance Company with consent got marked Exs.R.1 and R.2. The Tribunal has awarded Rs.50,000/- as fixed sum of compensation in favour of claimants no.1 and 2, i.e., the parents of the deceased and dismissed the claim petition of the claimant no.3, i.e., the brother. Being aggrieved by the same, the present appeal is filed.

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Sri Shivakumar S. Badawadagi, learned counsel for the appellants-claimants submits that the Tribunal has committed an error in dismissing the claim petition against appellant no.3 and committed error in holding that the appellants no.1 and 2 are not the dependents of the deceased. It is submitted that the deceased was working as a Teacher in the Government School. She was appointed on 24.07.2007 and from the date of her appointment till she got married on 19.06.2011 she use to contribute her entire income to the appellant and just after the marriage and within 2½ months thereafter she met with an accident and succumbed to the injuries. It is contended that even after the marriage she use to contribute her income to the family of the appellant.

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It is submitted that in order to substantiate the income and dependency, the appellant no.1 has examined himself and deposed before the Tribunal that his daughter used to contribute to the family and they were financially dependent on the income of the deceased. It is pointed out that PW2 who is the employer of the deceased has entered the witness box and got marked the salary certificate. It is his further submission that the respondent No.3 herein who is the husband of the

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deceased has filed M.V.C. No. 76/2012 to claim compensation, however the same was later withdrawn which clearly establish that the appellants were financially dependent on the income of the deceased and they are required to be considered as the dependents of the deceased and are entitled for compensation towards loss of dependency.

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It is also submitted that the appellants have initiated proceedings and filed P&SC No. 2/2012 before the Senior Civil Judge, Kumta. After a detailed trial the jurisdictional Court has granted P&SC certificate in favour of appellant no.1, i.e., the father of the deceased to enable him to receive the service benefits, i.e., gratuity and pension of the deceased. The said proceeding has been contested by the third respondenthusband, despite the same the trial Court has considered the evidence and granted P&SC certificate taking into account that the deceased has nominated the appellants-claimants as dependants/ legal heirs for the purpose of service benefits.

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It is contended that the Tribunal has erred in considering the evidence on record and erroneously come to the conclusion that the appellants are not dependents of the deceased and

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proceeded to award Rs.50,000/- as a meager sum of compensation under the head of loss of dependency. He seeks to allow the appeal by considering the appeals are the dependents of the deceased.

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Per contra, Sri Nagaraj C. Kolloori, learned counsel for the insurer supporting the impugned judgment and award of the Tribunal contended that the tribunal has recorded a categorical finding that the appellants are not the dependents of the deceased and they cannot be treated as legal heirs of the deceased. It is submitted that at the time of accident the deceased was staying with the husband and no evidence is placed on record to substantiate the claim of the appellants that the deceased was contributing all her salary or the income to the appellants and in the absence of any such evidence it would not be proper to consider the appellants as dependents of the deceased. It is further submitted that, admittedly they are the parents and the brother of the deceased who are residing separately and deceased was residing with respondents at the time of accident. Hence, he seeks to dismiss the appeal.

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Having heard the learned counsel for the appellant, learned counsel for the respondents, perused the memorandum of appeal and the tribunal records, the points that arise for consideration is:

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1. Whether the tribunal is justified in not awarding compensation to the appellants under the head of loss of dependency?

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1. Whether the award of compensation by the tribunal under the head of loss of estate is just and proper?

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The answer to the above points is in the ‘negative’ and ‘affirmative’ for the following reasons.

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The parties to the proceeding do not dispute that on 05.09.2011 Smt. Shwetha Honnappa Nayak, daughter of appellants no.1 and 2 and sister of appellant no.3 died in the road accident and the offending vehicle bearing no. KA-30-M3529 was insured with the respondent no.2-Insurance Company.

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The appellants-claimants in the claim petition have contended that the deceased was working as a Government School Teacher and drawing salary of Rs.12,609/- per month and she has joined the employment on 24.07.2007, she use to

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contribute the entire income to the family. On 19.06.2011 she got married to respondent no.3, and just within 2½ months of marriage Smt.Swetha met with an accident and she succumbed to the injuries in the road accident on 05.09.2011.

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On perusal of the oral testimony of PW1 it is evident that the appellant no.1 has clearly deposed that deceased used to contribute her income to the family, however, except the oral testimony of PW1 no other evidence is available on record to substantiate the claim of the claimants that even after the marriage the deceased continued to contribute her income to the appellants. In the absence of any such evidence on record it would be difficult for this Court to consider that the appellants are the dependents on the deceased for the purpose of determination of compensation under the head of loss of dependency. Hence, this court do not find any error in the finding recorded by the tribunal in paragraph no.14 of the impugned judgment holding that the appellants are not the dependents of the deceased. The tribunal considering the evidence on record has awarded compensation of Rs.50,000/to the appellant nos.1 and 2 under the head of loss of estate.

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This Court is of the considered view that the tribunal has committed an error in awarding meager compensation of Rs.50,000/- towards loss of estate. Before assessing loss of estate it will be useful to refer a decision of this Court in the

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case of A.Manavalagan Vs. A. Krishnamurthy and others¹ .

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But, what would be the position if the claimant, though a legal heir is not a dependant of the deceased? Obviously, the question of awarding any amount under the head of loss of dependency would not arise, as there was no financial dependency. In fact in this case, the deceased was not even managing the 'house hold' as is normally done by a housewife as the husband and wife were living in different places due to exigencies of service and the couple had no children. In such a case, the main head of compensation will be loss to estate under Section 2 of the Fatal Accidents Act. The claim petition becomes one on behalf of the estate of the deceased and the compensation received becomes part of the assets of the estate. Consequently what is to be awarded under the head of loss of dependency under Section 1A would be nil, as there is no real pecuniary loss to the members of the family.

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In GAMMELL v. WILSON, 1981(1) ALL ER. 578 the House of Lords held that in addition to the conventional and moderate damages for loss of expectation of life, damages for loss to the estate should include damages for loss of earnings of the lost years. The annual loss to the estate was computed to be the amount that the deceased would have been able to save after meeting the cost of his living and damages for loss to the estate were computed after applying a suitable multiplier to the annual loss. GAMMEL was relied on in SUSAMMA THOMAS (Supra) and

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1 ILR 2004 KAR 3268

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by the Madhya Pradesh High Court in RAMESH CHANDRA v. M.P. STATE ROAD TRANSPORT CORPN, 1983 ACC CJ 221". 18. In MADHYA PRADESH STATE ROAD TRANSPORT CORPORATION v. SUDHAKAR, 1977 ACJ 290 the Supreme Court considered a case where an employed husband claimed compensation in regard to the death of his wife who was employed on a monthly salary of Rs. 200/- to Rs. 250/-. The Supreme Court observed:

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"We find it difficult to agree that only half of that amount would have been sufficient for her monthly expenses till she retired from service, so that the remaining half may be taken as the measure of her husband's monthly loss. It is not impossible that she would have contributed half of her salary to the household, but then it is reasonable to suppose that the husband who was employed at slightly higher salary would have contributed his share to the common pool which would have been utilised for the lodging and boarding of both of them. We do not therefore think it is correct to assume that the husband's loss amounted to half the monthly salary the deceased was likely to draw until she retired. If on an average she contributed Rs. 100/- every month to the common pool, then his loss would be roughly not more than Rs. 50/-per month." 19. We may summarise the principles enunciated, thus: (i) The law contemplates two categories of damages on the death of a person. The first is the pecuniary loss sustained by the dependant members of his family as a result of such death. The second is the loss caused to the estate of the deceased as a result of such death. In the first category, the action is brought by the legal representatives, as trustees for the dependants beneficially entitled. In the second category, the action is brought by the legal representatives, on behalf of the estate of the deceased and the compensation, when recovered, forms part of the assets of the estate. In the first category of cases, the Tribunal in exercise of power under Section 168 of the Act,

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can specify the persons to whom compensation should be paid and also specify how it should be distributed (Note: for example, if the dependants of a deceased Hindu are a widow aged 35 years and mother aged 75 years, irrespective of the fact that they succeed equally under Hindu Succession Act, the Tribunal may award a larger share to the widow and a smaller share to the mother, as the widow is likely to live longer). But in the second category of cases, no such adjustments or alternation of shares is permissible and the entire amount has to be awarded to the benefit of the estate. Even if the Tribunal wants to specify the sharing of the compensation amount, it may have to divide the amount strictly in accordance with the personal law governing succession, as the amount awarded and recovered forms part of the estate of the deceased.

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(ii) Where the claim is by the dependants, the basis for award of compensation is the loss of dependency, that is loss of what was contributed by the deceased to such claimants. A conventional amount is awarded towards loss of expectation of life, under the head of loss to estate.

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(iii) Where the claim by the legal representatives of the deceased who were not dependants of the deceased, then the basis for award of compensation is the loss to the estate, that is the loss of savings by the deceased.

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A conventional sum for loss of expectation of life, is added.

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(iv) The procedure for determination of loss to estate is broadly the same as the procedure for determination of the loss of dependency. Both involve ascertaining the multiplicand and capitalising it by multiplying it by an appropriate multiplier. But, the significant difference is in the figure arrived at as multiplicand in cases where the claimants who are dependants claim loss of dependency, and in cases where the claimants who are not dependents claim loss to estate. The annual contribution to the family constitutes the multiplicand in the case of loss of dependency, whereas the annual savings of the

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deceased becomes the multiplicand in the case of loss to estate.

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The method of selection of multiplier is however the same in both cases.

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The following illustrations with reference to the case of a deceased who was aged 40 years with a monthly income of Rs. 9000/ will bring out the difference between cases where claimants are dependents and cases were claimants are not dependents.

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(i) If the family of the deceased consists of a dependant wife and child, normally one-third will be deducted towards the personal and living expenses of the deceased. The balance of Rs. 6000/- per month (or Rs. 72000/- per annum) will be treated as contribution to the dependent family. The loss of dependency will be arrived by applying a multiplier of 14. The loss of dependency will be Rs. 10,08,000/- plus Rs. 10,000/under the head of loss of Estate.

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(ii) If the family of the deceased was larger, say consisting of dependent parents, wife and two children, necessarily the deceased would spend more on his family and the deduction towards personal and living expenses of the deceased will shrink to one-fifth instead of one-third (Note: In Gulam Khader v. United India Insurance Co., Ltd., - ILR 2000 Kar 4416 detailes of this illustration have been given). Therefore the deduction toward personal and living expense would be Rs. 1800/- per month (one-fifth of Rs. 9000/-) and contribution to the family would be Rs. 7200/- per month or Rs. 86,400/- per annum. Thus loss of dependency will be Rs. 12,09,600/- (by applying the multiplier of 14). The award under the head of loss of estate would be Rs. 10000/-.

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(iii) If the deceased was a bachelor with dependent parents aged 65 and 60 years, normally 50% will be deducted towards personal and living expenses of the deceased. This is because a bachelor will be more care free as he had not yet acquired a wife or child and therefore would tend to spend more on

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himself. There was also a possibility of the bachelor getting married in which event the contribution to parents will get reduced. Therefore the contribution to the family (parents) will be Rs. 4500/- per month or Rs. 54000/- per annum. As the multiplier will be 10 with reference to age of the mother, the loss of dependency will be Rs. 5,40,000/-. Loss of Estate would be a conventional sum of Rs. 10,000/-.

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Note: The above three illustrations relate to cases where the claimants are dependants. The said illustration demonstrate that even though the income of the deceased and age of the deceased are the same, the 'loss of dependency' will vary, having regard to the number of dependants, age of the dependants and nature of dependency. The ensuing illustrations relate to cases where the legal heirs of the deceased are not dependants.

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(iv) If the deceased is survived by an educated employed wife earning an amount almost equal to that of her husband and if each was maintaining a separate establishment, the question of 'loss of dependency' may not arise. Each will be spending from his/her earning towards his living and personal expenses. Even if both pool their income and spend from the common income pool, the position will be the same. In such a case the amount spent for personal and living expenses by each spouse from his/her income will be comparatively higher, that is three-fourth of his/her income. Each would be saving only the balance, that is one fourth (which may be pooled or maintained separately). If the saving is taken as one-fourth (that is 25%), the loss to the estate would be Rs. 2250/- per month or Rs. 27000/- per annum, By adopting the multiplier of 14, the loss to estate will be Rs. 3,78,000/-.

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Note: The position would be different if the husband and wife, were both earning, and living together under a common roof, sharing the expenses. As stated in BURGESS v. FLORENCE NIGHTINGALE HOSPITAL (1955(1) Q.B. 349), 'when a husband

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and wife, with separate incomes are living together and sharing their expenses, and in consequence of that fact, their joint living expenses are less than twice the expenses of each one living separately, then each, by the fact of sharing, is conferring a benefit on the other'. This results in a higher savings, say, one-third of the income; In addition each spouse loses the benefit of services rendered by the other in managing the household, which can be evaluated at say Rs. 1,000/- per month or Rs. 12,000/- per annum). In such a situation, the claimant (surviving spouse) will be entitled to compensation both under the head of loss of dependency (for loss of services rendered in managing the household) and loss to estate (savings to an extent of one-third of the income that is Rs.3,000/- per month or Rs. 36000/- per annum). Therefore, the loss of dependency would be 12000x14=168,000/- and loss to estate would be 36000x14=504,000/-. In all Rs. 6,72,000/will be the compensation.

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(v) If the deceased was a bachelor and the claimants are two non-dependent brothers/sisters aged 47 years and 45 years with independent income, the position would be different. As the deceased did not have a 'family', the tendency would be to spend more on oneself and the savings would be hardly 15%. If the saving is taken as 15% (Rs. 1350/- per month), the annual savings would be Rs. 16,200/- which would be the multiplicand. The multiplier will be 13 with reference to the age of the claimants and the loss of estate would be Rs. 2,10,600/per annum.

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Though the quantum of savings will vary from person to person, there is a need to standardise the quantum of savings for determining the loss to estate (where the claimants are not dependants) in the absence of specific evidence to the contrary. The quantum of savings can be taken as one-third of the income of the deceased where the spouses are having a common establishment and one-fourth where the spouses are

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having independent establishments. The above will apply where the family consists of non-dependant spouse/ children/ parents. Where the claimants are non-dependant brothers/sisters claiming on behalf of the estate, the savings can be taken as 15% of the income. The above percentages, one of course, subject to any specific evidence to the contrary led by the claimants.

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We will now return to the facts of this case. In this case, as noticed above, the husband was living in Coimbatore and the wife was living near a place of her work (Tiruppur). Therefore, the husband (Appellant) had a separate establishment at Coimbatore and was living from his income. The wife (deceased) was having a separate establishment at Sowripalyam near Tiruppur and was living from her income. As the parties were residing at different places and were supporting themselves from their respective income, as noticed above, the question of loss of dependency will not arise. In such circumstances, the amount spent towards the expenses of living and personal expenses of the deceased can safely be taken as three-fourth of her income. The balance of one-fourth will be her saving or contribution to, the common saving pool.

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Keeping in mind the enunciation of law laid down supra,

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we are of the considered view that the appellants are entitled to 25% of the income of the deceased towards loss of estate. It is evident from record that the deceased from the date of her employment, i.e., 24.07.2007 till her marriage on 19.06.2011 she has contributed her entire income towards the family which can be considered as family estate. Thereafter she has contributed some portion of her salary to the betterment of her

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parents and brother which is evident from the oral testimony of PW1. Taking note of the fact that the deceased was entirely contributing her income prior to the marriage, to the appellants and just for 2½ months, she has contributed certain portion of the amount towards husband’s family and certain portion of her income to her parents and brother, clearly established that even after her marriage the deceased continued to contribute portion of her income to the appellants and under peculiar facts and circumstances of the case, this Court is of the considered view that the appellants are entitled for the loss of estate at the rate of 25% of the assessed income of the deceased by applying applicable multiplier and also by adding 50% of the assessed income under the head of loss of future prospects as held by the Apex Court in National Insurance Company Limited Vs. Pranay Sethi & Others² . Hence, the appellants are entitled for the following compensation.

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Rs.12,609/- (income) + Rs.6,304/- (future prospects at 50%) = Rs.18,913.50. x 12 x 17 x 25/100 = 9,64,588.50

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It is not in dispute that the appellants no.1 and 2 are the

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parents and appellant no.3 is the brother. They are entitled to

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2 2017(16) SCC 680

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compensation towards loss of consortium at Rs.40,000/- each as held by the Supreme Court in Magma General Insurance

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Company Limited Vs. Nanu Ram & Others³ . The

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claimants are also entitled for compensation of Rs.15,000/towards transportation of dead body and funeral expenses.

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Thus the claimants are entitled for compensation as under:

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Sl. No.	Particulars	Amount (Rs.)
1.	Loss of estate	9,64,588.50
2.	Loss of consortium (40,000x 3)	1,20,000.00
3.	Transportation and funeral	15,000.00
	expenses
	Total	10,99,588.50
	Award of tribunal	50,000.00
	Enhancement	10,49,588.50

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The claimants are entitled for interest on the compensation at

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the rate of 6% p.a. from the date of petition till the date of realization.

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Hence, we proceed to pass the following:

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ORDER

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i. The appeal is allowed in part.

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ii. The judgment and award dated 10.11.2016 passed in MVC No.66/2012 by the Tribunal, is modified to an extent that the claimants would be entitled to total compensation of

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3 2018 ACJ 2782

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Rs.10,99,588.50 as against Rs.50,000/awarded by the Tribunal.

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iii. The enhanced compensation amount of Rs.10,49,588.50 shall carry interest at the rate of 6% per annum from the date of petition till date of payment.

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iv. Respondent/Insurance Company shall deposit the enhanced compensation amount along with accrued interest before the Tribunal within a period of six weeks from the date of receipt of certified copy of this judgment.

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