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Accident claim – M.V. Act – Employee died at his age 46 years – future potentiality -Apex court held that where the deceased died at an early age of 46 years, had 12 more years of service, would have got promotions, resulting in hike in his pay and emoluments, we feel that ends of justice would be met if the potential earning capacity of the deceased is fixed at Rs.30,000/- p.m. Accordingly, we fix the potential earning capacity of the deceased per month at Rs.30,000/- instead of Rs.25,000/- as fixed by the Tribunal. After deducting 1/3rd portion from Rs.30,000/- towards personal expenses, the dependency benefit for the appellants would come to Rs.20,000/- and the multiplier applicable is 12 taking into consideration the age of the deceased. Accordingly, the loss of dependency is fixed at Rs. 20,000 x 12 x 12 = Rs.28,80,000/-. In addition to that, the appellants are entitled to Rs. 50,000/- as conventional amount as granted by the Tribunal. Thus, the appellants would be entitled to a total compensation of Rs. 29,30,000/- with interest @ 7.5% p.a.= RAMILABEN CHINUBHAI PARMAR & ORS. … APPELLANTS VERSUS NATIONAL INSURANCE CO. & ORS. … RESPONDENTS = 2014 ( April.Part ) judis.nic.in/supremecourt/filename=41453

 Accident claim – M.V. Act – Employee died at his age 46 years – future potentiality -Apex court held that where the deceased died at an  early  age  of  46 years, had 12 more years of service, would have  got  promotions,  resulting in hike in his pay and emoluments, we feel that ends  of  justice  would  be met  if  the  potential  earning  capacity  of  the  deceased  is  fixed  at

Rs.30,000/- p.m.  Accordingly, we fix the potential earning capacity of  the deceased per month at Rs.30,000/- instead of Rs.25,000/-  as  fixed  by  the Tribunal. After deducting 1/3rd portion from  Rs.30,000/-  towards  personal expenses,  the  dependency  benefit  for  the  appellants  would   come   to Rs.20,000/- and the multiplier applicable is 12  taking  into  consideration the age of the deceased. Accordingly, the loss of  dependency  is  fixed  at Rs. 20,000 x 12 x 12 = Rs.28,80,000/-.  In addition to that, the  appellants are entitled to   Rs. 50,000/- as conventional  amount  as  granted  by  the Tribunal.  Thus, the appellants would be entitled to  a  total  compensation

of Rs. 29,30,000/- with interest @ 7.5% p.a.=

The appellants herein are the claimants who filed  a  petition  before

the Motor Accident Claims Tribunal, Ahmedabad  claiming  an  amount  of  Rs.

40.00 lakhs as compensation on the  ground  that  the  sole  breadwinner  of

their family, who was 46 years  old,  had  died  in  a  road  accident.  The

Tribunal, relying upon the oral as well as documentary  evidence,  took  the

income of the deceased at Rs.15,000/- p.m. and considering his  age  at  46,

applied the multiplier 12.   In  addition  to  that,  the  Tribunal  granted

Rs.50,000/- as conventional amount, and finally  awarded  Rs.22,10,000/-  as

compensation to the appellants with interest  @ 9% p.a.=

 

It is evident from the order of the Tribunal as well  as

Salary Certificate filed as (Annexure P-2) the deceased was getting a  gross

salary of Rs.14,103.77 ps. p.m. apart from  benefits  like  GPF,  D.A.,  and

other allowances. 

It is also stated therein that  the  deceased  was  having

another 12 years of service and there is a chance of revision of pay  scales

and getting one more promotion. 

Taking all  these  into  consideration,  the

Tribunal arrived at a conclusion that the salary of the  deceased  would  be

Rs.35,000/- p.m. at the time of his retirement and Rs.25,000/- p.m.  as  his

potential earning capacity on  the  date  of  his  death.   

After  deducting

Rs.10,000/- towards personal expenses, his liability towards taxation  etc.,

the net contribution of the deceased towards his dependents was  arrived  at

Rs.15,000/- p.m., applied the multiplier 12 taking  into  consideration  the

age of the deceased and finally  awarded  an  amount  of  Rs.22,10,000/-  as

total compensation payable with interest @ 9% p.a.  The High  Court  without

properly appreciating the factum of  the  young  age  of  the  deceased  and

without taking future prospects  of  the  deceased  into  consideration  has

reduced the compensation from Rs.22,10,000/- to Rs.13,90,000/- and the  rate

of interest from 9% p.a. to 7.5% p.a.

7.    Even though we are not convinced with the  calculation  and  reasoning

given  by  the  Tribunal,  but  keeping  in  view  the  peculiar  facts  and

circumstances of the case, where the deceased died at an  early  age  of  46

years, had 12 more years of service, would have  got  promotions,  resulting

in hike in his pay and emoluments, we feel that ends  of  justice  would  be

met  if  the  potential  earning  capacity  of  the  deceased  is  fixed  at

Rs.30,000/- p.m.  Accordingly, we fix the potential earning capacity of  the

deceased per month at Rs.30,000/- instead of Rs.25,000/-  as  fixed  by  the

Tribunal. After deducting 1/3rd portion from  Rs.30,000/-  towards  personal

expenses,  the  dependency  benefit  for  the  appellants  would   come   to

Rs.20,000/- and the multiplier applicable is 12  taking  into  consideration

the age of the deceased. Accordingly, the loss of  dependency  is  fixed  at

Rs. 20,000 x 12 x 12 = Rs.28,80,000/-.  In addition to that, the  appellants

are entitled to   Rs. 50,000/- as conventional  amount  as  granted  by  the

Tribunal.  Thus, the appellants would be entitled to  a  total  compensation

of Rs. 29,30,000/- with interest @ 7.5% p.a.

8.    The appeals are accordingly allowed. The orders passed by  the  Courts

below are set aside. There shall be no order as to costs.

 

 2014 ( April.Part ) judis.nic.in/supremecourt/filename=41453

P SATHASIVAM, RANJAN GOGOI, N.V. RAMANA

NON – REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOs. 6091-6092 OF 2011

 

RAMILABEN CHINUBHAI PARMAR & ORS. … APPELLANTS

VERSUS

NATIONAL INSURANCE CO. & ORS. … RESPONDENTS
JUDGMENT

N.V. RAMANA, J.
The appellants herein are the claimants who filed a petition before
the Motor Accident Claims Tribunal, Ahmedabad claiming an amount of Rs.
40.00 lakhs as compensation on the ground that the sole breadwinner of
their family, who was 46 years old, had died in a road accident. The
Tribunal, relying upon the oral as well as documentary evidence, took the
income of the deceased at Rs.15,000/- p.m. and considering his age at 46,
applied the multiplier 12. In addition to that, the Tribunal granted
Rs.50,000/- as conventional amount, and finally awarded Rs.22,10,000/- as
compensation to the appellants with interest @ 9% p.a.
2. Aggrieved thereby, the respondent-Insurance Company preferred First
Appeal No. 301 of 2003 before the High Court. The appellants herein also
filed Cross Objection No. 107 of 2006 in the said appeal seeking
enhancement. After hearing the Insurance Company as well as claimants, the
High Court determined the net salary of the deceased as Rs.14,000/- p.m. by
applying the multiplier 8, arrived at the compensation towards loss of
dependency as Rs.13,44,000/-. It further added Rs.25,000/- for loss of
estate and Rs.15,000/- for loss of consortium to the widow of the deceased
and Rs.5,000/- towards funeral expenses. The High Court , thus, in all,
awarded a total amount of Rs.13,90,000/- as compensation with 7.5%
interest. Thus, the High Court by the impugned order reduced the
compensation from Rs.22,10,000/- to Rs.13,90,000/- and reduced the rate of
interest from 9% p.a. to 7.5% p.a.
3. Now aggrieved by the order of the High Court the claimants-appellants
filed these appeals for enhancement of compensation.
4. It is mainly contended by the learned counsel for the appellants
that the earning capacity of the deceased was Rs.35,000/- p.m. as per the
salary certificate and other documents, but the High Court has without any
reason, reduced the compensation amount by fixing Rs.14,000/- as the
monthly salary of the deceased. Similarly, the High Court has not even
considered the future prospects of the deceased who died at the young age
of 46 years and the High Court has ignored the fact that 12 years service
was left for the deceased on the date of death.
5. On the other hand, learned counsel for the Insurance Company
supported the order of the High Court and submitted that there is no reason
for this Court to interfere with the order of the High Court.
6. We have heard learned counsel for the parties and perused the
material before us. It is evident from the order of the Tribunal as well as
Salary Certificate filed as (Annexure P-2) the deceased was getting a gross
salary of Rs.14,103.77 ps. p.m. apart from benefits like GPF, D.A., and
other allowances. It is also stated therein that the deceased was having
another 12 years of service and there is a chance of revision of pay scales
and getting one more promotion. Taking all these into consideration, the
Tribunal arrived at a conclusion that the salary of the deceased would be
Rs.35,000/- p.m. at the time of his retirement and Rs.25,000/- p.m. as his
potential earning capacity on the date of his death. After deducting
Rs.10,000/- towards personal expenses, his liability towards taxation etc.,
the net contribution of the deceased towards his dependents was arrived at
Rs.15,000/- p.m., applied the multiplier 12 taking into consideration the
age of the deceased and finally awarded an amount of Rs.22,10,000/- as
total compensation payable with interest @ 9% p.a. The High Court without
properly appreciating the factum of the young age of the deceased and
without taking future prospects of the deceased into consideration has
reduced the compensation from Rs.22,10,000/- to Rs.13,90,000/- and the rate
of interest from 9% p.a. to 7.5% p.a.
7. Even though we are not convinced with the calculation and reasoning
given by the Tribunal, but keeping in view the peculiar facts and
circumstances of the case, where the deceased died at an early age of 46
years, had 12 more years of service, would have got promotions, resulting
in hike in his pay and emoluments, we feel that ends of justice would be
met if the potential earning capacity of the deceased is fixed at
Rs.30,000/- p.m. Accordingly, we fix the potential earning capacity of the
deceased per month at Rs.30,000/- instead of Rs.25,000/- as fixed by the
Tribunal. After deducting 1/3rd portion from Rs.30,000/- towards personal
expenses, the dependency benefit for the appellants would come to
Rs.20,000/- and the multiplier applicable is 12 taking into consideration
the age of the deceased. Accordingly, the loss of dependency is fixed at
Rs. 20,000 x 12 x 12 = Rs.28,80,000/-. In addition to that, the appellants
are entitled to Rs. 50,000/- as conventional amount as granted by the
Tribunal. Thus, the appellants would be entitled to a total compensation
of Rs. 29,30,000/- with interest @ 7.5% p.a.
8. The appeals are accordingly allowed. The orders passed by the Courts
below are set aside. There shall be no order as to costs.
…………………………………………CJI.
(P. SATHASIVAM)

 
……………………………………………J.
(RANJAN GOGOI)

 
……………………………………………J.
(N.V. RAMANA)
NEW DELHI,
APRIL 23 , 2014

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