Case Note & Summary
The appeal arises from a judgment and award dated 31.08.2019 passed by the Motor Accident Claims Tribunal (Aux), Bhuj-Kachchh, in MACP No.302/2013, whereby the Tribunal awarded compensation to the claimants, legal representatives of the deceased who died in a motor vehicle accident. The appellants, original claimants, filed the appeal under Section 173 of the Motor Vehicles Act, 1988, challenging the quantum of compensation on the ground that the Tribunal erred in assessing the income of the deceased at Rs.16,000 per month despite income tax returns showing an annual income of Rs.2,50,000. The deceased was a contractor doing fitting of tiles and marbles at Welspun Company, Anjar. The accident occurred in 2013, and the deceased was aged 38 years as per PAN card. The Tribunal held the offending vehicle solely negligent. The claimants argued that the income should be taken as Rs.20,833 per month (Rs.2,50,000/12) and that future prospects and conventional heads were inadequately awarded. The Insurance Company opposed, submitting that the Tribunal's assessment was just and proper. The High Court, after hearing both sides, found that the Tribunal had not given cogent reasons for rejecting the income tax returns and assessed the income at Rs.20,833 per month. Applying the multiplier of 15 as per Sarla Verma, adding 40% future prospects for self-employed deceased aged below 40 as per Pranay Sethi, and deducting 1/5th for personal expenses (7 dependents), the Court recalculated the loss of dependency. The Court upheld the conventional heads at Rs.70,000 as per Pranay Sethi. The total compensation was enhanced from Rs.24,22,000 to Rs.33,99,968, with interest at 7.5% per annum from the date of petition till realization. The appeal was partly allowed.
Headnote
A) Motor Accident Claims - Quantum of Compensation - Income Assessment - Deceased was a contractor earning Rs.2,50,000 per annum as per income tax returns - Tribunal assessed income at Rs.16,000 per month (Rs.1,92,000 per annum) - Held that Tribunal erred by not accepting the income tax returns without cogent reasons - Income assessed at Rs.20,833 per month (Rs.2,50,000/12) (Paras 5-6). B) Motor Accident Claims - Multiplier - Age of deceased 38 years - As per Sarla Verma, multiplier of 15 applicable - Tribunal applied multiplier of 15 - Held correct (Para 6). C) Motor Accident Claims - Future Prospects - Deceased was self-employed - As per Pranay Sethi, 40% addition for future prospects for self-employed aged below 40 - Held that 40% future prospects should be added (Para 6). D) Motor Accident Claims - Conventional Heads - Tribunal awarded Rs.70,000 under conventional heads - As per Pranay Sethi, Rs.70,000 is correct for funeral expenses, loss of consortium, and loss of estate - Held no interference required (Para 6). E) Motor Accident Claims - Deduction for Personal Expenses - Deceased had 7 dependents - As per Sarla Verma, deduction of 1/5th for personal expenses - Held that 1/5th deduction is appropriate (Para 6).
Issue of Consideration
Whether the Tribunal erred in assessing the income of the deceased at Rs.16,000 per month despite income tax returns showing annual income of Rs.2,50,000, and whether the compensation under conventional heads was inadequate.
Final Decision
The appeal is partly allowed. The judgment and award dated 31.08.2019 passed by the Motor Accident Claims Tribunal (Aux), Bhuj-Kachchh, in MACP No.302/2013 is modified. The total compensation is enhanced from Rs.24,22,000 to Rs.33,99,968. The enhanced amount shall carry interest at 7.5% per annum from the date of petition till realization. The Insurance Company is directed to deposit the enhanced amount within eight weeks.
Law Points
- Motor Vehicles Act
- 1988
- Section 173
- Compensation for death
- Income assessment based on income tax returns
- Multiplier as per Sarla Verma
- Conventional heads under Pranay Sethi
- Future prospects for self-employed
