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 Mahesh Kumar in a motor vehicle accident. The insurer sought reduction of compensation on the ground that the award was excessive. The claimants were the legal representatives of the deceased: Sandhya P. (wife), Kum. Maithili (minor daughter), and K.G. Mayadasi (mother). The deceased was aged 25 years and was a businessman earning Rs. 6,000/- per month. The Tribunal assessed the income at Rs. 6,000/- per month, added 50% towards future prospects, applied multiplier of 13, and did not deduct any amount towards personal expenses, resulting in a total compensation of Rs. 17,63,000/-. The High Court found that the Tribunal erred in not deducting 1/3rd towards personal expenses as the deceased was a bachelor, and in applying multiplier of 13 instead of 18. However, since the claimants did not appeal, the multiplier of 14 as per the decision in M. Nagaraj v. Union of India was applied. The High Court recalculated the compensation: income Rs. 6,000/- + 50% future prospects = Rs. 9,000/- per month; deduct 1/3rd towards personal expenses = Rs. 6,000/- per month; annual income = Rs. 72,000/-; apply multiplier 14 = Rs. 10,08,000/-; add conventional heads Rs. 5,000/- for funeral expenses, Rs. 5,000/- for loss of estate, and Rs. 10,000/- for loss of consortium = Rs. 20,000/-; total compensation = Rs. 10,28,000/-. The appeal was partly allowed, reducing the compensation from Rs. 17,63,000/- to Rs. 10,28,000/- with interest at 6% p.a.
Headnote
A) Motor Accident Claims - Compensation for Death - Deduction of Personal Expenses - Section 166, Motor Vehicles Act, 1988 - The Tribunal awarded compensation without deducting any amount towards personal expenses of the deceased, who was a bachelor aged 25 years. The High Court held that 1/3rd of the income should be deducted towards personal expenses as per the principles laid down in Sarla Verma v. DTC. (Paras 5-6) B) Motor Accident Claims - Compensation for Death - Multiplier - Section 166, Motor Vehicles Act, 1988 - The Tribunal applied multiplier of 13, but the deceased was aged 25 years. The High Court held that the correct multiplier as per Sarla Verma v. DTC is 18, but since the claimants did not appeal, the multiplier of 14 as per the decision in M. Nagaraj v. Union of India was applied. (Paras 7-8) C) Motor Accident Claims - Compensation for Death - Future Prospects - Section 166, Motor Vehicles Act, 1988 - The Tribunal added 50% towards future prospects. The High Court upheld this addition as per the decision in Sarla Verma v. DTC. (Para 6)
Issue of Consideration
Whether the compensation awarded by the Tribunal is just and proper, and whether the Tribunal erred in not deducting 1/3rd towards personal expenses and in applying the multiplier.
Final Decision
Appeal partly allowed. Compensation reduced from Rs. 17,63,000/- to Rs. 10,28,000/- with interest at 6% p.a. from the date of petition till deposit.
Law Points
- Motor Accident Claims
- Compensation for Death
- Deduction of Personal Expenses
- Multiplier
- Section 173(1) of Motor Vehicles Act
- 1988
