2025 INSC 15
SUPREME COURT OF INDIA
(HON’BLE C.T. RAVIKUMAR, J.)
NEW INDIA ASSURANCE CO. LTD
Petitioner
VERSUS
SONIGRA JUHI UTTAMCHAND
Respondent
Civil
Appeal No. of 2025 (@ SLP (C) No. 30491 of 2018) With Civil Appeal No. of 2025 (@
SLP (C) No. 10773 of 2019) Civil Appeal No. of 2025 (@ SLP (C) No. 33052 of
2018) Civil Appeal No. of 2025 (@ SLP (C) No. 10759 of 2019) Civil Appeal No.
of 2025 (@ SLP (C) No. 12272 of 2019)-Decide on 02-01-2025
Compensation, MACT
(A)
Motor Vehicles Act, 1988, Section 166, 168 – MACT– Deduction – Challenge by Insurer -Failure of the High Court to
deduct one-third of the income while calculating the compensation payable by
way of enhancement – Held that that the respondents-insurer justified in
contending that the High Court ought to have deducted one-third of the income
while calculating the compensation by way of enhancement, in terms of Sarla
Verma’s case.
(Para 10)
(B)
Motor Vehicles Act, 1988, Section 166, 168 – MACT – No enhancement – Age - Death case
–At the time of death of the brother of the appellant, he was aged only 10
years or thereabouts - The quantum of compensation Rs.2,45,000/- granted by the
Tribunal for the death of the brother of the appellant was enhanced by the High
Court in the appeal to Rs.5,00,000/- in terms of the decision of this Court
in Kishan Gopal and Anr. v. Lala and Others – Held that do not think that
the appellant has made any ground for enhancement for the compensation
granted for the death of her brother taking into account his age at the time of
the accident any further.
(Para 11)
(C)
Motor Vehicles Act, 1988, Section 166, 168 – MACT – Self -employed persons – Future prospectus – Multiplier - Held that
the appellant has certainly made out grounds for enhancement of compensation
granted for her parents, on certain counts - While calculating the monthly
income, in respect of the father and mother of the appellant, the Tribunal as
also the High Court did not consider the future prospects, may be because both
of them were not salaried persons - There cannot be any doubt with respect to
the position that in the case of self-employed persons too, fixation of monthly
income, taking the factor of future prospects cannot be denied - The position
is that, in the case of self- employed persons below the age group of 40 years,
40% of the income assessed for fixation is grantable taking into account
towards future prospects and in the case of persons within age group of 40 to
50 years an addition of 25% is grantable on that count, in terms of the
decision in Pranay Sethi’s case (supra) - In the case of the father of the
appellant, the multiplier was correctly taken with reference to his age -
However, in the case of her mother, the multiplier was not correctly taken in
terms of the decision in Sarla Verma’s case (supra) by both the Tribunal and
the High Court - The age of mother of the appellant was taken as 38 years - The
multiplier was taken as ‘16’ by the Tribunal and as ‘13’ by the High Court -
While considering the compensation for the death of the parents of the
appellant, additions and deductions have to be made taking into account the
aforesaid aspects - Appellant was aged only 14 years when she lost her parents as
also her younger brother - True that she got paternal grandfather - But
then, the plight and fate on account of such solitude was considered by the
Tribunal and the High Court - She will have to experience the same for long -
That apart, while calculating compensation it is to be borne in mind
that Section 168 of the Motor Vehicles Act mandates grant of ‘just
compensation’ - In a family of 4 members, viz., the parents and two children
including the appellant, three of them died, leaving the appellant - After
taking into account all parameters, just compensation was assessed and granted
by the High Court as per the impugned common judgment by way of enhancement,
which cannot be said to be excessive or exorbitant - In such circumstances, in
the name of correcting the law, do not think it appropriate to interfere with
justice done to the appellant by the High Court by granting enhanced
compensation - In the interest of justice, the enhanced compensation granted by
the High Court as per the impugned judgment has to be maintained - Resultantly,
all the appeals must fail and accordingly they are liable to be dismissed.
(Para
12)
JUDGMENT
C.T. Ravikumar, J. :- Leave granted.
2.
In these quintuplet appeals, two from the Insurer deceased persons, the
insurer claims for reduction of
quantum
of compensation and the claimant seeks enhancement of quantum of compensation
granted by the Motor Vehicles Accident Tribunal, raising various grounds. In
this judgment, the claimant is referred to as ‘the appellant’ and the insurance
company which preferred two appeals is referred to as ‘the respondent’, for
convenience.
3.
The unfortunate incident in which the appellant lost her parents and the
younger brother occurred on 20.06.2007. The offending vehicle bearing No.
TN-21-X- 3879/Tata van insured with the respondent driven by its driver in a
rash and negligent manner dashed against the stationary auto bearing No.
TN-07-Y-0657 in which the deceased persons were travelling. Seeking
compensation for the death of the father, mother and the brother, the appellant
filed MCOP No.5238/2011, MCOP No.5239/2011 and MCOP No.5252/2011, respectively.
On appreciating the evidence on record, both oral and documentary, the Tribunal
found the driver of the Tata van to be negligent and ultimately saddled the
respondent with the liability to indemnify the owner of the said offending
vehicle. Hence, in view of the concurrent findings in that regard, we proceed
to consider only on the question whether enhancement of compensation is to
be made at the instance of the appellant or reduction of compensation is to be
done at the instance of the respondent-insurer.
4.
The Tribunal granted an amount of Rs.14,78,000/-, as compensation for the death
of the father of the appellant. For the death of her mother and brother, the
Tribunal granted Rs.13,33,936/- and Rs.2,45,000/- respectively. Aggrieved by
and dissatisfied with the quantum of compensation thus awarded, the appellant
preferred appeals. After taking into account the rival contentions, the High
Court enhanced the compensation for the death of the father of the appellant
from Rs.14,78,000/- to Rs.30,58,000/- and for the death of her mother, the High
Court enhanced the compensation from Rs.13,33,936/- to Rs.16,34,000/-. For the
death of brother, the appellant was granted an amount of Rs.2,55,000/- in
addition, and in other words, enhanced the compensation from Rs.2,45,000/- to
Rs.5,00,000/-. As noted earlier, the appellant claims enhancement of
compensation in all the three cases and at the same time, the respondent seeks
deduction of quantum of compensation granted in the case of the parents of
the
claimant.
In other words, the respondent has chosen not to prefer any appeal against the
enhanced compensation granted for the death of the brother of the appellant.
5.
Heard the learned counsel appearing for the appellant and also the learned
counsel appearing for the respondent.
6.
We will, firstly, consider the appeals preferred by the respondent-insurer
seeking reduction of the enhanced quantum of compensation granted in the case
of the parents of the appellant. Needless to say, that only if the said question
of such deduction is answered in negative, the appeals by the claimant invite
consideration. A perusal of the appeals by the respondent would reveal that the
very same three questions of law have been raised while contending for
reduction of the enhanced compensation, as hereunder:-
“A. Whether the Hon'ble High
Court of Judicature at Madras has erred or not deducting the 1/3 of the income
of the deceased regarding personal expenditures where the deceased has a minor
daughter and old aged parents as the dependents? B. Whether the Hon'ble High
Court has error in considering the income of the deceased, where there is no
proof of income considered by the Hon'ble High Court and considered the
income on assumption basis? C. Whether the Hon'ble High Court has error in
awarding Rs.2,00,000/- to the respondent No.1 and also Rs.20,000/- to the
respondent no. 2 & 3 towards the loss love and affection and 30,000 /-
towards the Funeral Expenses. Whereas this Hon'ble Court had already fixed the
quantum in conventional heads at Rs. 70,000/- in total of all, in its judgment
in National Insurance Co. Ltd, vs. Pranay Sethi & Ors. (SLP
No. 25590/2014))?”
7.
It is true that a perusal of the award passed by the Tribunal and the judgment
of the High Court in the appeals would reveal that when one-third of the income
assessed in the case of the parents was deducted towards their personal
expenses by the Tribunal while determining the quantum of enhanced
compensation, the High Court did not deduct one-third without assigning any
specific reason therefor. In that regard, according to us there cannot be
any room for doubt with respect to the position that while calculating the
quantum of compensation for death, deduction is bound to be effected towards
personal and living expenses, this position was made clear by this Court in the
decision in Sarla Verma and Ors. v. Delhi Transport Corporation
& Anr., in paragraph 30 of the said decision it was held
thus:-
“30. Though in some cases the
deduction to be made towards personal and living expenses is calculated on the
basis of units indicated in Trilok Chandra [(1996) 4 SCC 362], the general
practice is to apply standardised deductions. Having considered several
subsequent decisions of this Court, we are of the view that where the deceased
was married, the deduction towards personal and living expenses of the
deceased, should be one-third (1/3rd) where the number of dependent family
members is 2 to 3, one-fourth (1/4th) where the number of dependent family
members is 4 to 6, and one-fifth (1/5th) where the number of dependent family
members exceeds six.”
8.
The ground No. B taken in consonance with the question of law No. B in the
appeals filed by the insurer is that the High Court had gone wrong in
considering the income of the deceased on assumption basis when there was no
proof of income. In this context, it is to be noticed that though the Tribunal
granted compensation in all the three claim petitions, the respondent-insurer
had not chosen to challenge the awards in appeals. In that regard, the
indisputable position revealed from the records is that the parents of the
appellant were not salaried persons and the claim was that they were self-
employed. A perusal of the impugned judgment would reveal the monthly income of
the appellant’s father as also the mother were fixed by the Tribunal and the
same was not challenged by the respondent in appeal. The fact is that, the appellant
had produced only the xerox copies of the Income Tax Returns of her parents,
pertaining to the financial years 2003 to 2007. Indisputably, the Tribunal as
also the High Court did not take them as admissible evidence and make
assessment on their basis. At the same time without placing reliance on the
xerox copies of the Income Tax Returns, the Tribunal fixed the monthly income
of her father as Rs.12,000/- and that of her mother as Rs.8,000/-. The impugned
judgment would reveal that the monthly income thus fixed in the case of the
parents were slightly enhanced by the High Court and it in the case her of
father was re-fixed as Rs. 18,000/- and in case of her mother as Rs. 9,000/-.
As held by this Court in Sarla Verma’s case (supra), in the matter of assessment
of compensation, hypothetical considerations would be involved, but
nevertheless such assessments should be objective. As noticed hereinbefore, the
accident had occurred in the year 2007, and the father of the appellant, who
claimed to had been running a jewellery shop, was aged only 48 years at the
time of the accident. In the case of the mother of the appellant, she was aged
only 38 years at the time of the accident and she was also not a mere housewife
and claimed to had been running a jewellery shop. The Tribunal could not be
said to have committed any mistake in not accepting the xerox copies of the tax
returns and virtually adopted guess work relying on the attending circumstances
to fix the monthly income of the parents of the appellant for calculation
purpose. But finding that the monthly income so assessed was slightly on the
lower side and taking into account various parameters, the High Court enhanced
the monthly income in their cases, respectively as Rs.18,000/- and Rs. 9,000/-.
Taking note of the year of the accident and the age of the deceased parents of
the appellant, we do not think that the monthly income so re- fixed by the High
Court is without jurisdiction or highly excessive. The said approach cannot be
said to be legally improper or incorrect warranting an interference.
Monthly income could be fixed taking into account the tax returns only if the
details of payment of tax are appropriately brought into evidence so as to
enable the Tribunal/Court to calculate the income in accordance with law.
9.
In tune with the question of law No.C, the respondent-insurer took a ground in
the appeal contending that the High Court had gone wrong in granting amount in
excess of Rs.70,000/- under the conventional heads. In this context, the
learned counsel appearing for the respondent drew our attention to the
law laid down by this Court in the decision in National
Insurance Co. Ltd. v. Pranay Sethi & Ors. . Paragraph 59.8 of the
said decision would reveal that this Court held that under the conventional
heads, only a total amount of Rs.70,000/- ; the split-up being Rs. 15,000/-
under the head loss of estate, Rs.40,000/- under the head loss of consortium
and Rs.15,000/- towards funeral expenses, is grantable. It is to be noted that
after having held thus, this Court went on to hold that the amounts thus fixed
under the conventional heads should be revisited every three years and the
enhancement should be at the rate of 10% in a span of three years. Even while
taking into account the said position laid down by this Court in
Pranay Sethi’s case, we are of the view that the Tribunal and the High Court
cannot be found at fault with fixing the amounts in excess of the aforesaid
amounts fixed by this Court as the award and the judgment of the High Courts were
passed prior to the pronouncement of the judgment of this Court in Pranay
Sethi’s case. But at the same time, it is to be noted that in the decision
in M.A. Murthy v. State of Karnataka and Ors., this Court held that when
in a decision this Court enunciates a principle of law, it is applicable to all
cases irrespective of the stage of pendency thereof because it is to be assumed
that what is enunciated by this Court is, in fact, the law from inception. We
may hasten to add that we shall not be understood to have held that pursuant to
enunciation of a principle of law, matters that attained finality shall be
reopened solely for the purpose of applying the law thus laid. But at the same
time, if the matter is pending, then, irrespective of the stage, the principle
cannot be ignored.
10.
Now, we will consider the contention of the respondent-insurer regarding the
failure of the High Court to deduct one-third of the income while calculating
the compensation payable by way of enhancement, in terms of the decision of
this Court in Sarla Verma’s case (supra). This is because the decision in Sarla
Verma’s case (supra) was very much in force as a precedent since 15.04.2009. In
view of the same, we are of the view that the respondents are justified in
contending that the High Court ought to have deducted one-third of the income
while calculating the compensation by way of enhancement, in terms of Sarla
Verma’s case (supra).
11.
Now, we will consider the appeals preferred by the appellant to know the merits
of the contentions. It is to be noted that at the time of death of the brother
of the appellant, he was aged only 10 years or thereabouts. The quantum of
compensation Rs.2,45,000/- granted by the Tribunal for the death of the brother
of the appellant was enhanced by the High Court in the appeal to Rs.5,00,000/-
in terms of the decision of this Court in Kishan Gopal and Anr. v. Lala
and Others4, we do not think that the appellant has made any ground for enhancement
for the compensation granted for the death of her brother taking into account
his age at the time of the accident any further.
12.
The question, now, survives for consideration is whether the appellant is
entitled to get enhanced compensation in respect of the accidental death of her
parents. We think that the appellant has certainly made out grounds for
enhancement of compensation granted for her parents, on certain counts. It is a
fact that while calculating the monthly income, in respect of the father and
mother of the appellant, the Tribunal as also the High Court did not consider
the future prospects, may be because both of them were not salaried persons.
There cannot be any doubt with respect to the position that in the case of
self-employed persons too, fixation of monthly income, taking the factor of
future prospects cannot be denied. The position is that, in the case of self-
employed persons below the age group of 40 years, 40% of the income assessed
for fixation is grantable taking into account towards future prospects and in
the case of persons within age group of 40 to 50 years an addition of 25% is
grantable on that count, in terms of the decision in Pranay Sethi’s case
(supra). In the case of the father of the appellant, the multiplier was
correctly taken with reference to his age. However, in the case of her mother,
the multiplier was not correctly taken in terms of the decision in Sarla
Verma’s case (supra) by both the Tribunal and the High Court. The age of mother
of the appellant was taken as 38 years. The multiplier was taken as ‘16’ by the
Tribunal and as ‘13’ by the High Court. To put it succinctly, while considering
the compensation for the death of the parents of the appellant, additions and
deductions have to be made taking into account the aforesaid aspects which we
have held not considered in the light of the contentions of the
respondent-insurer as also the factors with reference to the contentions made
on behalf of the appellant. On working out the entitlement of enhancement upon
such consideration, we find that the answer can only be in the negative. In
fact, if the amount thus payable is re-worked making such additions and
deductions on the aforesaid heads it will result in lowering of the quantum of
compensation, though certainly not in a big way. At the same time, we cannot
lose sight of certain other aspects. The appellant was aged only 14 years when
she lost her parents as also her younger brother. True that she
got paternal grandfather. But then, the plight and fate on account of such
solitude was considered by the Tribunal and the High Court. She will have to
experience the same for long. That apart, while calculating compensation it is
to be borne in mind that Section 168 of the Motor Vehicles Act
mandates grant of ‘just compensation’. In a family of 4 members, viz., the
parents and two children including the appellant, three of them died, leaving
the appellant. After bestowing our anxious consideration on all aspects, we are
of the considered view that after taking into account all parameters, just
compensation was assessed and granted by the High Court as per the impugned
common judgment by way of enhancement, which cannot be said to be excessive or
exorbitant. In such circumstances, in the name of correcting the law, we do not
think it appropriate to interfere with justice done to the appellant by the
High Court by granting enhanced compensation. In other words, we do not think
that after re-working out, the compensation payable to the appellant should be
brought down, to some extent, especially because the difference between what
was already granted and to be granted, if reworked, cannot be said to be
alarmingly excessive. Therefore, we are of the considered view that in the
interest of justice, the enhanced compensation granted by the High Court as per
the impugned judgment has to be maintained. Resultantly, all the appeals must
fail and accordingly they are dismissed.
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