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Accident claim – trial court awarded Rs.37 lacs and odd where as High court reduced the same to Rs.15 lacs and odd – Apex court held that deceased aged 58 years, his salary Rs.50000 and odd – multiplication by 8 and 1/4 th deduction – and other benefits granted – where as high court unnecessarily deducted the same under contributory negligence as the offender vehicle driver was acquitted in criminal case and reduced the compensation by raising personal deduction to one third and also not granted other benefits and also reduced the annual income with unnecessary deductions against law = CIVIL APPEAL NO.7158 OF 2014 (Arising out of SLP(C) NO. 4333 OF 2014) SARALADEVI & ORS. ………APPELLANTS Vs. DIVISIONAL MANAGER, M/S ROYAL SUNDARAM ALLIANCE INS. CO. LTD. & ANR. …RESPONDENTS = 2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41857

Accident claim – trial court awarded Rs.37 lacs and odd where as High court reduced the same to Rs.15 lacs and odd – Apex court held that deceased aged 58 years, his salary Rs.50000 and odd – multiplication by 8 and 1/4 th deduction – and other benefits granted – where as high court unnecessarily deducted the same under contributory negligence as the offender vehicle driver was acquitted in criminal case  and reduced the compensation by raising personal deduction to one third and also not granted other benefits and also reduced the annual income with unnecessary deductions against law  =

The  prosecution  has

failed to prove  the  case  against  the  driver  beyond  reasonable  doubt,

therefore, the learned Judicial Magistrate had acquitted the driver  of  the

vehicle from the charge framed against him vide order dated 31.05.2010.

3.  The appellants – the widow, two daughters and bed-ridden aged mother  of

the deceased-Vasanthan  approached  the  Motor  Accidents  Claims  Tribunal,

Vellore (for short “MACT”) by filing claim petition  under  Section  166  of

the Motor Vehicles Act, 1988 (for short “the Act”) claiming compensation  of

Rs.45,00,000/- on account of death of their sole bread earner,  against  the

owner as well as the insurer of the vehicle. The  said  claim  petition  was

registered as M.C.O.P. No. 138 of 2009.=

At the time of death, Vasanthan  was  58

years  old  and  was  earning  a  salary  of  Rs.50,809/-  per  month   i.e.

Rs.6,09,708/- annually. By applying the appropriate multiplier of 8 as  laid

down under Kerala Road Transport Corporation v. Susamma Thomas[3], the  loss

of dependency comes to Rs.48,77,708/-.=

we are of the view that  where  the  deceased  was  married,  the  deduction

towards personal and living expenses of the deceased,  should  be  

one-third

(1/3rd) where the number of dependent family members is 2 to  3,  

one-fourth

(1/4th) where the number of dependent family members is 4  to  6,  and  

one-

fifth (1/5th) where the number of dependent family members exceeds six.”

      The High Court failed to follow the above judgement and  committed  an

error in law in deducting 1/3rd amount  towards  personal  expenses  of  the

deceased. 

Therefore, as per the above judgement the deduction  ought  to  be

1/4th only as correctly calculated by the Tribunal.  

Thus,  after  deducting

1/4th  i.e.  Rs.12,19,416/-  towards  personal   expenses;   the   loss   of

dependency would be Rs.36,58,248/. 

Further, we affirm  the  sum  granted  by

the Tribunal as Rs.5,000/- for funeral expenses, under the head of  loss  of

estate at Rs.10,000/-, loss of consortium  at  Rs.10,000/-  and  Rs.50,000/-

for loss of love and affection of the deceased.

12.     Further, the High Court has erred in not following the  decision  of

Rajesh and Ors. v. Rajbir Singh and Ors.[4]  by  awarding  only  Rs.10,000/-

for loss of consortium, instead of Rs.1,00,000/-. 

Towards  loss  of  estate,

the High Court awarded Rs.10,000/- instead of  Rs.1,00,000/.  

Therefore,  to

this extent there is loss caused to the appellants in not being  compensated

correctly under different  heads  such  as,  loss  of  consortium,  loss  of

estate,  and  loss  of  love  and  affection. 

 Further,  as  per   Municipal

Corporation of Delhi v. Uphaar Tragedy Victims Association  &  Ors.[5],  the

appellants are entitled for  9%  interest  per  annum  on  the  compensation

awarded from the date  of  filing  of  the  application  till  the  date  of

payment. 

Thus, there will be a difference of 1.5%  interest  amount  payable

on the total compensation awarded by both the Tribunal and  the  High  Court

as they have awarded at  7.5%  interest.  

Therefore,  if  the  less  awarded

difference of interest amount @ 1.5%  by both  the  Tribunal  and  the  High

Court is taken into consideration  on  the  total  compensation  awarded  in

favour of the appellants,  it  would  take  care  of  the  amount  that  was

required to be  deducted towards income tax out of the gross salary  of  the

deceased for determining the compensation  under  the  heading  of  loss  of

dependency.

13.      Since,  the  High  Court  has  erred  in  not  correctly   awarding

compensation under the above heads  and  having  regard  to  the  facts  and

circumstances of the case, we affirm the Award of the Tribunal and the  same

is restored.

     Therefore,  the  determination  of  compensation  under  the  loss   of

dependency under other heads as indicated  in  the  following  paragraph  is

perfectly legal and valid as the said compensation is  just  and  reasonable

keeping in view the monthly income at Rs.50,809/-  as  per  the  documentary

evidence (Ex.P-7), the salary certificate.

14.   In the result, the impugned judgment and order of the  High  Court  is

liable to be set aside and accordingly  set  aside  and  the  Award  of  the

Tribunal is  affirmed.  Therefore,  the  appellants  shall  be  entitled  to

compensation under the following heads:

Loss of Dependency                      Rs.36,58,248/-

Funeral Expenses                      Rs.    5,000/-

Loss of love and affection                   Rs.   50,000/-

Loss of estate                               Rs.   10,000/-

Loss of consortium                           Rs.   10,000/-

Total:                                                        Rs.37,33,248/-

   Thus, the total compensation payable to the appellants/claimants will  be

Rs.37,33,248/- with interest  @ 7.5% per annum  from the date of  filing  of

the  application  till  the  date  of  payment.  The  apportionment  of  the

compensation in favour of  the  appellants  is  as  per  the  Award  of  the

Tribunal.

15.  Accordingly, we allow this appeal in the above terms.  The  respondent-

Insurance Company shall  either  pay  the  compensation  by  way  of  demand

draft/drafts in favour of the appellants or deposit the same  with  interest

as awarded by the Motor Accidents Claims Tribunal within six weeks from  the

date of receipt of the copy of this judgment,  after  deducting  the  amount

already deposited.

2014- Aug. Part – http://judis.nic.in/supremecourt/filename=41857

|NON-REPORTABLE |

IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.7158 OF 2014
(Arising out of SLP(C) NO. 4333 OF 2014)

SARALADEVI & ORS. ………APPELLANTS

Vs.

DIVISIONAL MANAGER, M/S ROYAL
SUNDARAM ALLIANCE INS. CO. LTD. & ANR. …RESPONDENTS

J U D G M E N T

V. GOPALA GOWDA, J.

This appeal has been filed by the appellants being aggrieved by the
judgment dated 12.09.2012 passed in C.M.A. No. 690 of 2011 by the High
Court of Madras whereby the High Court reduced the compensation awarded at
Rs.37,33,248/- by the Motor Accidents Claims Tribunal and re-determined at
Rs.15,84,750/-.
2. The necessary relevant facts are stated hereunder to appreciate the
case of the appellants with a view and to ascertain whether the appellants
are entitled for the enhancement of compensation as prayed in this appeal.
The deceased met with an accident on 28.01.2009 on account of rash and
negligent driving of the motor vehicle bearing registration No. TN-23-AF-
0048, which hit the back side of the deceased’s motor cycle. The deceased
sustained grievous injuries and succumbed to the same. A post-mortem was
conducted on 29.01.2009 and inspection report was filed in CC.No.55 of 2009
before the Court of Judicial Magistrate No. II, Walajahpet by the Inspector
of Police against the driver of the offending vehicle. The prosecution has
failed to prove the case against the driver beyond reasonable doubt,
therefore, the learned Judicial Magistrate had acquitted the driver of the
vehicle from the charge framed against him vide order dated 31.05.2010.
3. The appellants – the widow, two daughters and bed-ridden aged mother of
the deceased-Vasanthan approached the Motor Accidents Claims Tribunal,
Vellore (for short “MACT”) by filing claim petition under Section 166 of
the Motor Vehicles Act, 1988 (for short “the Act”) claiming compensation of
Rs.45,00,000/- on account of death of their sole bread earner, against the
owner as well as the insurer of the vehicle. The said claim petition was
registered as M.C.O.P. No. 138 of 2009.
4. The Insurance Company filed its counter statement stating that the
accident occurred only due to the negligent riding of the two wheeler by
the deceased-Vasanthan and that they are not liable to pay the compensation
amount as claimed by the appellants.
5. The MACT has conducted an enquiry by giving an opportunity to the
parties to adduce evidence in support of their respective claim. Three
witnesses (PW-1 to PW-3) were examined on behalf of the appellants and the
exhibits were marked as Exs. P-1 to P-15. On behalf of respondents two
witnesses RW-1 and RW-2 were examined and exhibits were marked as Exs. R-1
and R-2. The Tribunal on appreciation of pleadings and legal evidence on
record came to the right conclusion and held that the accident occurred due
to the negligence of the driver of the offending vehicle. Thereafter, on
the basis of legal evidence on record the MACT determined the quantum of
compensation. For this purpose, the Tribunal has taken the monthly salary
of the deceased at Rs.50,809/- as per the salary certificate Exh.P-7.
Therefore, his annual income was fixed at Rs.6,09,708/-. The deceased was
aged 58 years at the time of the accident and the Tribunal has taken the
multiplier as 8. Therefore, the total loss of income of the deceased
would be Rs.48,77,664/-. 1/4th of this amount i.e. Rs.12,19,416/- was
deducted towards his personal expenses as his dependents are four in
number. Hence, the loss of dependency of the appellants was calculated at
Rs.36,58,248/-. For funeral expenses, a sum of Rs.5,000/- was awarded. For
loss of estate Rs.10,000/- and for loss of consortium to the 1st appellant,
a sum of Rs.10,000/- was granted. For loss of love and affection, a sum of
Rs.50,000/- was granted to the appellants. Thus, the Tribunal has assessed
the total compensation under different heads as mentioned above and passed
an award for a sum of Rs.37,33,248/- to the appellants with interest @ 7.5%
from the date of petition i.e. 08.06.2009 and further directed the
Insurance Company to pay the said amount by indemnifying the owner of the
vehicle as the same was insured with it.
6. The insurer i.e. the Royal Sundaram Alliance Insurance Company Ltd. had
challenged the correctness of the award passed by the Tribunal in favour of
the appellants by filing an appeal before the High Court of Judicature at
Madras seeking for the modification of the compensation awarded in favour
of the appellants by the Tribunal contending that the same is excessive,
urging various grounds in support of its appeal.
7. The High Court, after examining the facts, evidence and circumstances
of the case, has held that as per the judgement in Sarla Verma & Ors. vs.
Delhi Transport Corporation & Anr.[1] the correct multiplier between the
age group of 56-60 should have been 9 since the deceased was 58 years at
the time of his death. Further, the High Court held that if the actual
salary of Rs.50,809/- is taken into consideration, the annual loss of
income of the deceased works out to Rs.6,09,708/- and 10% of the amount is
liable to be deducted towards income tax deduction. 10% in the sum of
Rs.6,09,708/- comes to Rs.60,970.80 and the same can be rounded off to
Rs.61,000/-. If so, the balance amount works out to Rs.5,48,708-
(Rs.6,09,708/- minus Rs.61,000/-), rounded off to Rs.5,49,000/- as the
annual income of the deceased. Hence, annual loss of income could be fixed
at Rs.5,49,000/-. For the first two years, the loss of income would be
Rs.10,98,000/- (Rs.5,49,000/- x 2 years). For the balance 7 years, only 50%
annual income has to be taken into consideration as notional income, which
comes to Rs.19,21,500/- (Rs.2,74,500/- x 7 years). Therefore, the total
loss of income works out to Rs.30,19,500/-. Further, the High Court was of
the opinion that 1/3rd amount is liable to be deducted towards personal
expenses of the deceased. If this amount is deducted out of the annual
income of the deceased, the balance amount works out to Rs.20,13,000/-
which amounts to a total loss of dependency (Rs.30,19,500/- minus
Rs.10,06,500/-). The High Court further held that there is contributory
negligence on the part of the deceased which was assessed at 25% which
amount would be Rs.5,03,250/-. When this amount was deducted out of
Rs.20,13,000/-, the High Court held that the legal heirs of the deceased
are entitled to Rs.15,09,750/- towards loss of dependency.
Thus, the High Court reduced the total compensation and awarded
under the following heads:
Loss of Dependency Rs.15,09,750/-
Funeral Expenses Rs. 5,000/-
Loss of Estate Rs. 10,000/-

Loss of Consortium Rs. 10,000/-

Loss of love and affection Rs. 50,000/-
Total : Rs.15,84,750/-

8. Thus, the High Court while partly allowing the Civil Miscellaneous
Appeal of the Insurance Company, directed it to deposit the above said
amount with an interest at the rate of 7.5% per annum from the date of the
petition, within a period of six weeks before the Tribunal after deducting
the amount already deposited.
9. Aggrieved by the impugned judgement and final Order dated 12.09.2012
passed by the High Court, the appellants filed this appeal before this
Court urging various tenable grounds namely, as to whether the High Court
was justified in holding that there is a contributory negligence on the
part of the deceased contrary to the evidence of the eye witness; whether
the High Court was justified in fixing the ratio of contributory negligence
as 25% on the part of the deceased on the basis of an erroneous finding;
whether the High Court was justified in reducing the amounts awarded by the
Tribunal from Rs.37,33,248/- to Rs.15,84,750/- and lastly, whether the High
Court was justified in deducting 1/3rd amount towards personal expenses of
the deceased contrary to the law laid down by this Court in various
judgements?
10. In our considered view, the High Court has erred in not considering
the principles laid down in the case of Sarla Verma & Ors. (supra) in so
far as deduction of 1/4th of the monthly income of the deceased to arrive
at the multiplicand and reducing the compensation by adopting the split up
multiplier. Further, recording the finding of contributory negligence on
the part of the deceased in the absence of evidence on record in this
regard rendered the finding erroneous in law and error in law as the same
is contrary to the decision of this Court reported in Jiju Kuruvila and
Ors. v. Kunjujamma Mohan & Ors.[2]. At the time of death, Vasanthan was 58
years old and was earning a salary of Rs.50,809/- per month i.e.
Rs.6,09,708/- annually. By applying the appropriate multiplier of 8 as laid
down under Kerala Road Transport Corporation v. Susamma Thomas[3], the loss
of dependency comes to Rs.48,77,708/-.
11. Further, deduction towards personal expenses of the deceased out of
the annual income would be 1/4th as held by this Court in the case of
Sarla Verma & Ors.(supra), the relevant portion of the judgment reads thus
: –
“30. Though in some cases the deduction to be made towards personal and
living expenses is calculated on the basis of units indicated in
Trilok Chandra, the general practice is to apply standardised
deductions. Having considered several subsequent decisions of this Court,
we are of the view that where the deceased was married, the deduction
towards personal and living expenses of the deceased, should be one-third
(1/3rd) where the number of dependent family members is 2 to 3, one-fourth
(1/4th) where the number of dependent family members is 4 to 6, and one-
fifth (1/5th) where the number of dependent family members exceeds six.”

The High Court failed to follow the above judgement and committed an
error in law in deducting 1/3rd amount towards personal expenses of the
deceased. Therefore, as per the above judgement the deduction ought to be
1/4th only as correctly calculated by the Tribunal. Thus, after deducting
1/4th i.e. Rs.12,19,416/- towards personal expenses; the loss of
dependency would be Rs.36,58,248/. Further, we affirm the sum granted by
the Tribunal as Rs.5,000/- for funeral expenses, under the head of loss of
estate at Rs.10,000/-, loss of consortium at Rs.10,000/- and Rs.50,000/-
for loss of love and affection of the deceased.

12. Further, the High Court has erred in not following the decision of
Rajesh and Ors. v. Rajbir Singh and Ors.[4] by awarding only Rs.10,000/-
for loss of consortium, instead of Rs.1,00,000/-. Towards loss of estate,
the High Court awarded Rs.10,000/- instead of Rs.1,00,000/. Therefore, to
this extent there is loss caused to the appellants in not being compensated
correctly under different heads such as, loss of consortium, loss of
estate, and loss of love and affection. Further, as per Municipal
Corporation of Delhi v. Uphaar Tragedy Victims Association & Ors.[5], the
appellants are entitled for 9% interest per annum on the compensation
awarded from the date of filing of the application till the date of
payment. Thus, there will be a difference of 1.5% interest amount payable
on the total compensation awarded by both the Tribunal and the High Court
as they have awarded at 7.5% interest. Therefore, if the less awarded
difference of interest amount @ 1.5% by both the Tribunal and the High
Court is taken into consideration on the total compensation awarded in
favour of the appellants, it would take care of the amount that was
required to be deducted towards income tax out of the gross salary of the
deceased for determining the compensation under the heading of loss of
dependency.
13. Since, the High Court has erred in not correctly awarding
compensation under the above heads and having regard to the facts and
circumstances of the case, we affirm the Award of the Tribunal and the same
is restored.
Therefore, the determination of compensation under the loss of
dependency under other heads as indicated in the following paragraph is
perfectly legal and valid as the said compensation is just and reasonable
keeping in view the monthly income at Rs.50,809/- as per the documentary
evidence (Ex.P-7), the salary certificate.
14. In the result, the impugned judgment and order of the High Court is
liable to be set aside and accordingly set aside and the Award of the
Tribunal is affirmed. Therefore, the appellants shall be entitled to
compensation under the following heads:

Loss of Dependency Rs.36,58,248/-
Funeral Expenses Rs. 5,000/-
Loss of love and affection Rs. 50,000/-
Loss of estate Rs. 10,000/-
Loss of consortium Rs. 10,000/-
Total: Rs.37,33,248/-

Thus, the total compensation payable to the appellants/claimants will be
Rs.37,33,248/- with interest @ 7.5% per annum from the date of filing of
the application till the date of payment. The apportionment of the
compensation in favour of the appellants is as per the Award of the
Tribunal.
15. Accordingly, we allow this appeal in the above terms. The respondent-
Insurance Company shall either pay the compensation by way of demand
draft/drafts in favour of the appellants or deposit the same with interest
as awarded by the Motor Accidents Claims Tribunal within six weeks from the
date of receipt of the copy of this judgment, after deducting the amount
already deposited.

…………………………………………………………J.
[DIPAK MISRA]

…………………………………………………………J.
[V. GOPALA GOWDA]

New Delhi,
August 20, 2014

———————–
[1]
[2] (2009) 6 SCC 121
[3]
[4] (2013) 9 SCC 166
[5]
[6] AIR 1994 SC 1631
[7]
[8] (2013) 9 SCC 54
[9]
[10] (2011) 14 SCC 481

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