Case Note & Summary
The appellants, being the legal heirs of deceased Arjun Bhalekar, filed an appeal against the judgment and award dated 2.5.2013 passed by the Motor Accident Claims Tribunal, Latur in MACP No.323/2010, which awarded Rs.3,60,000 as compensation for the death of Arjun in a vehicular accident on 29.9.2010. The deceased, a pedestrian, was hit by a tum tum auto rickshaw bearing registration No.MH-44-A-1084. The Tribunal assessed the notional income of the deceased at Rs.3,000 per month, applied multiplier of 15, deducted 1/3rd towards personal expenses, and awarded Rs.5,000 for funeral expenses and Rs.5,000 for loss of consortium. The appellants contended that the Tribunal erred in taking notional income despite evidence of actual income of Rs.4,500 per month as a labourer, failed to add future prospects, applied wrong multiplier, and made incorrect deductions. The High Court, per Justice V.K. Jadhav, held that the income should be taken as Rs.4,500 per month based on documentary evidence. Following the principles in National Insurance Co. Ltd. v. Pranay Sethi, 40% future prospects were added as the deceased was aged 50 years. The multiplier was corrected to 13 as per Sarla Verma v. DTC. Since there were 6 dependents, deduction for personal expenses was reduced to 1/4th. Conventional heads were enhanced: Rs.15,000 for funeral expenses and Rs.40,000 for loss of consortium (each claimant). The total compensation was recalculated as Rs.6,72,000, with interest at 6% per annum from the date of petition till realization. The appeal was allowed, and the award was modified accordingly.
Headnote
A) Motor Accident Claims - Compensation - Income Calculation - The Tribunal erred in taking the notional income of deceased as Rs.3,000 per month despite documentary evidence of income of Rs.4,500 per month as a labourer - Held that the income should be taken as Rs.4,500 per month (Para 7).
B) Motor Accident Claims - Compensation - Future Prospects - The Tribunal failed to add any amount towards future prospects - Following the principles in National Insurance Co. Ltd. v. Pranay Sethi, 40% addition towards future prospects is warranted for a self-employed person aged 50 years - Held that 40% future prospects must be added (Para 8).
C) Motor Accident Claims - Compensation - Multiplier - The Tribunal applied multiplier of 15 instead of 13 as per the age of deceased (50 years) - Held that multiplier of 13 is correct as per Sarla Verma v. DTC (Para 9).
D) Motor Accident Claims - Compensation - Deduction for Personal Expenses - The Tribunal deducted 1/3rd towards personal expenses, but since the deceased had 6 dependents, deduction should be 1/4th - Held that 1/4th deduction is appropriate (Para 10).
E) Motor Accident Claims - Compensation - Conventional Heads - The Tribunal awarded Rs.5,000 towards funeral expenses and Rs.5,000 towards loss of consortium - Following Pranay Sethi, Rs.15,000 for funeral expenses and Rs.40,000 for loss of consortium (each claimant) is appropriate - Held that enhanced amounts are granted (Para 11).
Issue of Consideration
Whether the Motor Accident Claims Tribunal erred in calculating compensation by not considering the deceased's actual income and future prospects, and whether the award of Rs.3,60,000 was just and proper.
Final Decision
The appeal is allowed. The judgment and award dated 2.5.2013 passed by the Motor Accident Claims Tribunal, Latur in MACP No.323/2010 is modified. The compensation is enhanced from Rs.3,60,000 to Rs.6,72,000. The enhanced amount shall carry interest at the rate of 6% per annum from the date of petition till realization. The respondent No.2 Insurance Company is directed to deposit the enhanced amount within eight weeks.
Law Points
- Motor Accident Claims
- Compensation Calculation
- Future Prospects
- Multiplier Method
- Deduction for Personal Expenses
- Income Proof
- Negligence of Tribunal
Case Details
2017 LawText (BOM) (07) 65
First Appeal No.2659 of 2013
Mr. R.P. Adgaonkar for Appellants, Mr. Amit Yadkikar for Respondent No.1, Mr. M.M. Ambhore for Respondent No.2
Kamalbai W/o Arjun Bhalekar and others
Sanjay S/o Pandhari Potbhare and The Manager, The New India Assurance Co. Ltd.
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Nature of Litigation
Appeal against judgment and award of Motor Accident Claims Tribunal in a claim petition under Section 166 of Motor Vehicles Act, 1988 for compensation for death in vehicular accident.
Remedy Sought
Appellants (original claimants) sought enhancement of compensation awarded by the Tribunal.
Filing Reason
The Tribunal awarded Rs.3,60,000 which the appellants considered inadequate due to incorrect income assessment, failure to add future prospects, wrong multiplier, and incorrect deductions.
Previous Decisions
The Motor Accident Claims Tribunal, Latur in MACP No.323/2010 dated 2.5.2013 awarded Rs.3,60,000 with interest at 6% per annum.
Issues
Whether the Tribunal erred in taking the notional income of the deceased as Rs.3,000 per month instead of the actual income of Rs.4,500 per month?
Whether the Tribunal erred in not adding any amount towards future prospects?
Whether the Tribunal applied the correct multiplier?
Whether the deduction for personal expenses was correctly applied?
Whether the amounts awarded under conventional heads are adequate?
Submissions/Arguments
Appellants argued that the Tribunal wrongly assessed income at Rs.3,000 per month despite documentary evidence showing Rs.4,500 per month as a labourer.
Appellants argued that no amount was added towards future prospects, which is contrary to law.
Appellants argued that the multiplier of 15 was wrongly applied; as per Sarla Verma, for age 50, multiplier is 13.
Appellants argued that deduction of 1/3rd for personal expenses was excessive; since there are 6 dependents, deduction should be 1/4th.
Appellants argued that amounts under conventional heads are meager and need enhancement as per Pranay Sethi.
Ratio Decidendi
In motor accident claims, the income of the deceased must be taken as per documentary evidence, not notional income. Future prospects at 40% must be added for self-employed persons aged 50 years as per Pranay Sethi. Multiplier should be as per Sarla Verma based on age. Deduction for personal expenses should be 1/4th when dependents are 6 or more. Conventional heads must be as per Pranay Sethi: Rs.15,000 for funeral expenses and Rs.40,000 for loss of consortium per claimant.
Judgment Excerpts
The Tribunal has committed an error in taking the notional income of the deceased as Rs.3,000/- per month. The claimants have produced on record the documentary evidence to show that the deceased was earning Rs.4,500/- per month.
The Tribunal has not added any amount towards future prospects. In view of the law laid down by the Supreme Court in the case of National Insurance Co. Ltd. v. Pranay Sethi, 40% of the income is required to be added towards future prospects.
The Tribunal has applied multiplier of 15. However, as per the age of the deceased i.e. 50 years, the multiplier of 13 is applicable as per Sarla Verma v. DTC.
The Tribunal has deducted 1/3rd towards personal expenses. Since the deceased has left behind 6 dependents, the deduction towards personal expenses should be 1/4th.
The Tribunal has awarded Rs.5,000/- towards funeral expenses and Rs.5,000/- towards loss of consortium. In view of the law laid down in Pranay Sethi, the claimants are entitled to Rs.15,000/- towards funeral expenses and Rs.40,000/- towards loss of consortium.
Procedural History
The original claimants filed MACP No.323/2010 before the Motor Accident Claims Tribunal, Latur, which was decided on 2.5.2013 awarding Rs.3,60,000. Aggrieved, the claimants filed First Appeal No.2659/2013 before the Bombay High Court, Aurangabad Bench, which was heard and disposed of on 4.7.2017.
Acts & Sections
- Motor Vehicles Act, 1988: Section 166
