Case Note & Summary
The appeal was filed by the insurer, The New India Assurance Co., Ltd., against the judgment and award dated 01/02/2010 passed by the III Additional District Judge and Member, Motor Accident Claims Tribunal-IV, Dakshina Kannada, Mangalore, in MVC No.1126/2007. The Tribunal had awarded a compensation of Rs. 17,63,000 with interest at 6% p.a. from the date of petition till deposit for the death of a person in a motor vehicle accident. The insurer sought reduction of compensation on the ground that the award was excessive. The High Court examined the impugned award and found that the Tribunal had applied a multiplier of '13' instead of '14' as per the decision in Sarla Verma v. DTC, (2009) 6 SCC 121, given the age of the deceased was 45 years. Additionally, the Tribunal had failed to deduct 1/3rd of the income of the deceased towards personal expenses. The High Court recalculated the loss of dependency by taking the monthly income of the deceased as Rs. 4,500, adding 30% towards future prospects (Rs. 1,350), making it Rs. 5,850 per month. After deducting 1/3rd towards personal expenses, the monthly loss was Rs. 3,900, annual loss Rs. 46,800, and applying multiplier 14, the total loss of dependency was Rs. 6,55,200. The High Court also awarded Rs. 10,000 for loss of consortium, Rs. 5,000 for loss of estate, and Rs. 5,000 for funeral expenses, totaling Rs. 20,000 under conventional heads. Thus, the total compensation was reduced to Rs. 6,75,200. The appeal was partly allowed, and the award was modified accordingly. The insurer was directed to deposit the reduced amount with interest at 6% p.a. from the date of petition till deposit, and the claimants were entitled to withdraw the same.
Headnote
A) Motor Accident Claims - Compensation for Death - Multiplier Method - The Tribunal applied multiplier '13' instead of '14' as per Sarla Verma v. DTC, (2009) 6 SCC 121. The High Court corrected the multiplier to '14' based on the age of the deceased (45 years). (Paras 4-5) B) Motor Accident Claims - Deduction for Personal Expenses - The Tribunal failed to deduct 1/3rd of the income of the deceased towards personal expenses. The High Court held that 1/3rd must be deducted as per settled law. (Para 5) C) Motor Accident Claims - Loss of Dependency - Computation - The High Court recalculated loss of dependency as Rs. 4,500 (income) + 30% future prospects = Rs. 5,850, minus 1/3rd personal expenses = Rs. 3,900 per month, annual Rs. 46,800, multiplied by 14 = Rs. 6,55,200. (Para 5) D) Motor Accident Claims - Conventional Heads - The High Court awarded Rs. 10,000 for loss of consortium, Rs. 5,000 for loss of estate, and Rs. 5,000 for funeral expenses, totaling Rs. 20,000. (Para 5) E) Motor Accident Claims - Total Compensation - The High Court reduced the total compensation from Rs. 17,63,000 to Rs. 6,75,200 with interest at 6% p.a. from the date of petition till deposit. (Para 6)
Issue of Consideration
Whether the compensation awarded by the Tribunal is just and proper, and whether the Tribunal erred in applying the multiplier and in not deducting personal expenses of the deceased.
Final Decision
Appeal partly allowed. The impugned judgment and award dated 01/02/2010 in MVC No.1126/2007 is modified. The total compensation is reduced from Rs. 17,63,000 to Rs. 6,75,200. The insurer is directed to deposit the reduced amount with interest at 6% p.a. from the date of petition till deposit within four weeks. The claimants are entitled to withdraw the same.
Law Points
- Motor Accident Claims
- Compensation for Death
- Multiplier Method
- Deduction for Personal Expenses
- Section 173(1) Motor Vehicles Act
- 1988
