Case Note & Summary
The Supreme Court allowed an appeal by the claimants (husband and two daughters of the deceased Lakshmi Nagalla) against the reduction of compensation by the High Court. The deceased, a 43-year-old software engineer and real estate salesperson residing in the USA, died in a motor vehicle accident on 13 June 2009 caused by a bus owned by the Andhra Pradesh State Road Transport Corporation. The Motor Accidents Claims Tribunal (MACT) awarded Rs.8,03,42,476/- with interest at 7.5% per annum, applying a multiplier of 14 and converting the monthly income of $11,600 at an exchange rate of Rs.57 per dollar (rate at the time of filing the claim petition in 2012). The High Court, on appeal by the Transport Corporation, reduced the multiplier to 10 relying on United India Insurance Co. Ltd. v. Patrica Jean Mahajan, resulting in a reduced award of Rs.5,75,68,982/-. The claimants appealed to the Supreme Court. The Supreme Court framed two issues: (a) the proper date for fixing the exchange rate, and (b) the correct multiplier. On the first issue, the Court followed Jiju Kuruvila v. Kunjujamma Mohan and DLF Ltd. v. Koncar Generators & Motors Ltd., holding that the exchange rate as on the date of filing the claim petition (Rs.57 per dollar) is the proper rate. On the second issue, the Court applied National Insurance Co. Ltd. v. Pranay Sethi, which mandates a multiplier of 14 for a person aged 43, regardless of the currency of earnings. The Court recalculated the compensation: monthly income $11,600, yearly $1,39,200, future prospects 30% ($41,760), total $1,80,960, deduction 1/3 for three dependents ($60,320), net $1,20,640, multiplied by 14 = $16,88,960, converted at Rs.57 = Rs.9,62,70,720, plus loss of estate Rs.18,150, funeral expenses Rs.18,150, and loss of consortium for three claimants at Rs.48,400 each (total Rs.96,8900), resulting in total compensation of Rs.9,64,52,220/-. The Court modified the High Court's order accordingly and directed that interest be paid as awarded by the Tribunal.
Headnote
A) Motor Accident Compensation - NRI Deceased - Exchange Rate - Date of Filing Claim Petition - The proper date for fixing the rate of exchange for computing compensation is the date of filing of the claim petition, not the date of accident, as held in Jiju Kuruvila v. Kunjujamma Mohan and followed in DLF Ltd. v. Koncar Generators & Motors Ltd. (Paras 9). B) Motor Accident Compensation - Multiplier - Age 43 - Pranay Sethi - The multiplier for a person aged 43 must be 14 as per National Insurance Co. Ltd. v. Pranay Sethi, and no exception is made for a person earning in foreign currency. The High Court erred in reducing the multiplier to 10 relying on United India Insurance Co. Ltd. v. Patrica Jean Mahajan. (Paras 10). C) Motor Accident Compensation - Computation - Future Prospects, Deductions, Conventional Heads - For a 43-year-old deceased with monthly income of $11,600, future prospects at 30%, deduction of 1/3 for three dependents, multiplier of 14, conversion at Rs.57 per dollar (rate at filing), plus loss of estate Rs.18,150, funeral expenses Rs.18,150, and loss of consortium Rs.48,400 per claimant (three claimants) totaling Rs.96,8900, the total compensation is Rs.9,64,52,220/-. (Paras 10).
Issue of Consideration
Whether compensation for death of a person earning in foreign currency should be calculated at exchange rate as on date of accident or date of filing claim petition; whether multiplier of 14 or 10 should be applied for a 43-year-old deceased earning in foreign currency
Final Decision
The Civil Appeal is allowed. The impugned award of the MACT as modified by the High Court is further modified. The total compensation is enhanced to Rs.9,64,52,220/-. Interest to be paid as awarded by the Tribunal.
Law Points
- Compensation for death of NRI
- exchange rate for foreign currency income
- multiplier for age 43
- future prospects at 30%
- deduction for dependents
- loss of consortium
- loss of estate
- funeral expenses
