Case: Saraladevi Vs. Divisional Manager, Royal Sundaram Alliance Ins. Co. Ltd

2. The necessary relevant facts are stated hereunder to appreciate the case of the appellants with a view and to ascertain whether the appellants are entitled for the enhancement of compensation as prayed in this appeal. The deceased met with an accident on 28.01.2009 on account of rash and negligent driving of the motor vehicle bearing registration No.0048, which hit the back side of themotor cycle. The deceased sustained grievous injuries and succumbed to the same. Awas conducted on 29.01.2009 and inspection report was filed in CC.No.55 of 2009 before the Court of Judicial Magistrate No. II, Walajahpet by the Inspector of Police against the driver of the offending vehicle. The prosecution has failed to prove the case against the driver beyond reasonable doubt, therefore, the learned Judicial Magistrate had acquitted the driver of the vehicle from the charge framed against him vide order dated 31.05.2010.3. The appellantsthe widow, two daughters andaged mother of theapproached the Motor Accidents Claims Tribunal, Vellore (for shortby filing claim petition under Section 166 of the Motor Vehicles Act, 1988 (for short) claiming compensation of Rs.45,00,000/on account of death of their sole bread earner, against the owner as well as the insurer of the vehicle. The said claim petition was registered as M.C.O.P. No. 138 of 2009.4. The Insurance Company filed its counter statement stating that the accident occurred only due to the negligent riding of the two wheeler by theand that they are not liable to pay the compensation amount as claimed by the appellants.5. The MACT has conducted an enquiry by giving an opportunity to the parties to adduce evidence in support of their respective claim. Three witnesses3) were examined on behalf of the appellants and the exhibits were marked as Exs.5. On behalf of respondents two witnesseswere examined and exhibits were marked as Exs.2. The Tribunal on appreciation of pleadings and legal evidence on record came to the right conclusion and held that the accident occurred due to the negligence of the driver of the offending vehicle. Thereafter, on the basis of legal evidence on record the MACT determined the quantum of compensation. For this purpose, the Tribunal has taken the monthly salary of the deceased at Rs.50,809/as per the salary certificate Exh.Therefore, his annual income was fixed at Rs.The deceased was aged 58 years at the time of the accident and the Tribunal has taken the multiplier as 8. Therefore, the total loss of income of the deceased would be Rs.1/4th of this amount i.e. Rs.12,19,416/was deducted towards his personal expenses as his dependents are four in number. Hence, the loss of dependency of the appellants was calculated at Rs.For funeral expenses, a sum of Rs.5,000/was awarded. For loss of estate Rs.10,000/and for loss of consortium to the 1st appellant, a sum of Rs.10,000/was granted. For loss of love and affection, a sum of Rs.50,000/was granted to the appellants. Thus, the Tribunal has assessed the total compensation under different heads as mentioned above and passed an award for a sum of Rs.37,33,248/to the appellants with interest @ 7.5% from the date of petition i.e. 08.06.2009 and further directed the Insurance Company to pay the said amount by indemnifying the owner of the vehicle as the same was insured with it.6. The insurer i.e. the Royal Sundaram Alliance Insurance Company Ltd. Had challenged the correctness of the award passed by the Tribunal in favour of the appellants by filing an appeal before the High Court of Judicature at Madras seeking for the modification of the compensation awarded in favour of the appellants by the Tribunal contending that the same is excessive, urging various grounds in support of its appeal.Thus, the High Court while partly allowing the Civil Miscellaneous Appeal of the Insurance Company, directed it to deposit the above said amount with an interest at the rate of 7.5% per annum from the date of the petition, within a period of six weeks before the Tribunal after deducting the amount already deposited.9. Aggrieved by the impugned judgement and final Order dated 12.09.2012 passed by the High Court, the appellants filed this appeal before this Court

Court's reasoning:
10. In our considered view, the High Court has erred in not considering the principles laid down in the case of Sarla Verma & Ors. (supra) in so far as deduction of 1/4th of the monthly income of the deceased to arrive at the multiplicand and reducing the compensation by adopting the split up multiplier. Further, recording the finding of contributory negligence on the part of the deceased in the absence of evidence on record in this regard rendered the finding erroneous in law and error in law as the same is contrary to the decision of this Court reported in Jiju Kuruvila and Ors. v. Kunjujamma Mohan & Ors. [2013) 9 SCC 166 ]. At the time of death, Vasanthan was 58 years old and was earning a salary of Rs.50,809/per month i.e. Rs.6,09,708/Further, deduction towards personal expenses of the deceased out of the annual income would be 1/4th as held by this Court in the case of Sarla Verma & Ors.(supra), the relevant portion of the judgment reads thus :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, the general practice is to apply standardized 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(1/3rd) where the number of dependent family members is 2 to 3,(1/4th) where the number of dependent family members is 4 to 6, and onefifth (1/5th) where the number of dependent family members exceedsHigh Court failed to follow the above judgement and committed an error in law in deducting 1/3rd amount towards personal expenses of the deceased. Therefore, as per the above judgement the deduction ought to be 1/4th only as correctly calculated by the Tribunal. Thus, after deducting 1/4th i.e. Rs.12,19,416/towards personal expenses; the loss of dependency would be Rs.36,58,248/. Further, we affirm the sum granted by the Tribunal as Rs.5,000/for funeral expenses, under the head of loss of estate atloss of consortium at Rs.10,000/or loss of love and affection of the deceased.12. Further, the High Court has erred in not following the decision of Rajesh and Ors. v. Rajbir Singh and Ors. [(2013) 9 SCC 54]  by awarding only Rs.10,000/for loss of consortium, instead of Rs.Towards loss of estate, the High Court awarded Rs.10,000/instead of Rs.1,00,000/. Therefore, to this extent there is loss caused to the appellants in not being compensated correctly under different heads such as, loss of consortium, loss of estate, and loss of love and affection. Further, as per Municipal Corporation of Delhi v. Uphaar Tragedy Victims Association & Ors. [2011) 14 SCC 481 ], the appellants are entitled for 9% interest per annum on the compensation awarded from the date of filing of the application till the date of payment. Thus, there will be a difference of 1.5% interest amount payable on the total compensation awarded by both the Tribunal and the High Court as they have awarded at 7.5% interest. Therefore, if the less awarded difference of interest amount @ 1.5% by both the Tribunal and the High Court is taken into consideration on the total compensation awarded in favour of the appellants, it would take care of the amount that was required to be deducted towards income tax out of the gross salary of the deceased for determining the compensation under the heading of loss of dependency.13. Since, the High Court has erred in not correctly awarding compensation under the above heads and having regard to the facts and circumstances of the case, we affirm the Award of the Tribunal and the same isthe determination of compensation under the loss of dependency under other heads as indicated in the following paragraph is perfectly legal and valid as the said compensation is just and reasonable keeping in view the monthly income at Rs.50,809/as per the documentary evidencethe salary certificate.