Case Note & Summary
The present appeal arose from the judgment and award of the Motor Accident Claims Tribunal, Ahmednagar in MACP No. 407 of 2012, whereby the claim petition filed by the respondents under Section 166 of the Motor Vehicles Act, 1988 was allowed and compensation of Rs.21,56,680 with 8% interest per annum was awarded against the appellants. The deceased, Ashok Harakchand Kauthale, a 30-year-old Constable in CISF, died in a road accident on 22-06-2011 while travelling in a lorry owned by appellant No.1 and driven by an employee of the appellants. The claimants, being the widow, minor daughter, and mother of the deceased, had sought compensation of Rs.20,00,000. The Tribunal held that the accident occurred due to the negligence of the lorry driver and that the appellants, as owner and employer, were jointly and severally liable. The appellants, while not disputing the liability, challenged the quantum of compensation on two grounds: that the ex gratia payment of Rs.10,00,000 made to the claimants under the Central Government rules should be deducted, and that the non-pecuniary damages were excessive. The respondents contended that the Tribunal’s computation was correct and that no provision required deduction of the ex gratia payment. The High Court, in a limited appeal, examined whether the ex gratia amount should be deducted and whether the non-pecuniary damages were proper. Relying on the Supreme Court decision in Reliance General Insurance Co. v. Shashi Sharma and the Bombay High Court ruling in Steel Authority of India Ltd. v. Jijabai Vijay Sonone, the court held that the ex gratia payment, which was equivalent to pay and allowances given to help the family in crisis, must be deducted to avoid conferring a double benefit and to ensure that compensation remains just and not a bonanza. Consequently, Rs.10,00,000 was directed to be deducted from the total compensation. Regarding non-pecuniary damages, the Tribunal had awarded consortium of Rs.1,00,000 each to all three claimants and Rs.25,000 for funeral expenses, following Rajesh v. Rajbir Singh. The High Court, applying the Constitution Bench decision in National Insurance Co. Ltd. v. Pranay Sethi, modified the award: the widow was granted Rs.40,000 for loss of consortium, the minor child Rs.40,000 for loss of love and affection, the mother Rs.40,000 for loss of love and affection, and funeral expenses were reduced to Rs.15,000. The interest rate of 8% was maintained. The appeal was thus partly allowed, with the compensation amount reduced accordingly.
Headnote
A) Motor Vehicles - Compensation - Deduction of Ex Gratia Payment - Motor Vehicles Act, 1988, Sections 166, 168 - The High Court considered whether the ex gratia payment of Rs.10,00,000 received by the claimants from the employer, a CISF Regional Training Centre, should be deducted from the total compensation awarded by the Tribunal. The court relied on the Supreme Court decision in Reliance General Insurance Co. v. Shashi Sharma and the Bombay High Court decision in Steel Authority of India Ltd. v. Jijabai Vijay Sonone, holding that the ex gratia payment, being a financial assistance equivalent to pay and allowances, would result in a double benefit if not deducted. It was held that compensation under the Motor Vehicles Act must be just and not a bonanza, and therefore the ex gratia amount must be excluded. (Paras 8-10) B) Motor Vehicles - Compensation - Non-Pecuniary Damages - Motor Vehicles Act, 1988 - The Tribunal had awarded Rs.1,00,000 each to the widow, child, and mother towards consortium and Rs.25,000 for funeral expenses, based on Rajesh v. Rajbir Singh. The High Court, following the Constitution Bench in National Insurance Co. Ltd. v. Pranay Sethi, modified the award: the widow was entitled to Rs.40,000 towards loss of consortium, the minor child to Rs.40,000 towards loss of love and affection (parental consortium), the mother to Rs.40,000 towards loss of love and affection, and funeral expenses were reduced to Rs.15,000. The interest rate of 8% was maintained. (Para 11)
Issue of Consideration
Whether the ex gratia payment made to the legal representatives of the deceased employee should be deducted from the compensation awarded under the Motor Vehicles Act, 1988; Whether the non-pecuniary damages awarded by the Tribunal were in accordance with the law laid down by the Supreme Court
Final Decision
Appeal is partly allowed. The amount of Rs.10,00,000 (ex gratia payment) is directed to be deducted from the total compensation of Rs.21,56,680 awarded by the Tribunal. The compensation under non-pecuniary heads is modified: Respondent No.1 (widow) is entitled to loss of consortium at Rs.40,000; Respondent No.2 (daughter) is entitled to loss of love and affection at Rs.40,000; Respondent No.3 (mother) is entitled to loss of love and affection at Rs.40,000; and funeral expenses are reduced to Rs.15,000. The rest of the award, including the rate of interest at 8% per annum, is maintained. Parties to bear their own costs.
Law Points
- Legal points not extracted
- Compensation must be just and not a bonanza
- ex gratia payment received by claimants from employer must be deducted from motor accident compensation to avoid double benefit
- non-pecuniary damages to be assessed as per Constitution Bench in Pranay Sethi
- consortium only to spouse
- children and parents entitled to loss of love and affection
- funeral expenses Rs.15
- 000
