Case Note & Summary
The appeal arose from a motor accident claim under Section 166 of the Motor Vehicles Act, 1988. On 26 March 1999, Vasant, a pillion rider on a motorcycle, died following a road accident on Nagpur-Bhandara Road. He was unmarried and survived by his aged parents, who filed Claim Petition No. 649/1999 before the Motor Accident Claims Tribunal, Nagpur, seeking compensation of Rs. 2,50,000. The tribunal assessed his monthly income at Rs. 1,500-1,600, deducted one-third for personal expenses, applied a multiplier of 17 based on the deceased's age (26-30 years), and awarded Rs. 2,16,000 inclusive of no-fault liability. The vehicle owner, Prashant, appealed, contending that the deduction should be 50% since the deceased was unmarried and that the multiplier should be based on the age of the claimants (parents) rather than the deceased. The High Court formulated the point for determination as the fair and just compensation payable. The court held that under Sarla Verma v. Delhi Transport Corporation, the deduction towards personal expenses for an unmarried deceased is 50%, not one-third, thereby accepting the appellant's first contention. On the multiplier, the court followed the Supreme Court's decision in P. Somnath v. District Insurance Officer, which reiterated Sarla Verma and ruled that the multiplier must be determined by the age of the deceased, not the dependents. Consequently, the multiplier of 17 was upheld. The compensation was recalculated: loss of dependency at Rs. 750 per month (50% of assumed income) × 12 × 17 = Rs. 1,53,000, plus Rs. 10,000 for love and affection and Rs. 3,000 for funeral expenses, totalling Rs. 1,66,000 inclusive of no-fault liability. The appeal was partly allowed, reducing the award from Rs. 2,16,000 to Rs. 1,66,000 with interest at 7.5% per annum from the date of filing the claim petition, along with proportionate costs. The judgment thus favoured the appellant, the vehicle owner, by lowering the compensation amount.
Headnote
A) Motor Vehicles Act, 1988 - Compensation - Deduction for Personal and Living Expenses - For an unmarried deceased, deduction should be 50% of income, not 1/3rd as per Sarla Verma v. Delhi Transport Corporation, 2009 4 ALL MR 429. The tribunal had deducted only 1/3rd; the High Court held that the correct deduction is 50% in line with the Supreme Court decision. (Paras 4, 7) B) Motor Vehicles Act, 1988 - Compensation - Multiplier - Selection of Multiplier - The multiplier must be based on the age of the deceased, not the age of the dependents, following Sarla Verma and P. Somnath v. District Insurance Officer, 2011(3) Mh.L.J. (S.C.)735. The tribunal correctly applied multiplier of 17 for deceased aged 26-30 years; the High Court rejected appellant's argument to use the age of the claimants. (Paras 5-6)
Issue of Consideration
What should be the fair and just compensation to which the claimants are entitled to?
Final Decision
Appeal partly allowed. Compensation reduced to Rs. 1,66,000/- inclusive of no fault liability, with interest @ 7.5% from date of filing till realization, with proportionate costs.
Law Points
- Deduction for personal expenses of unmarried deceased is 50%
- Multiplier based on deceased's age
- No fault liability included
- Interest at 7.5% from filing date
