MFA/5123/2024 of ROYAL SUNDARAM GENERAL INSURANCE CO., LTD., Vs SRI N RAMACHANDRAPPA on 18 August 2026

ORAL JUDGMENT

(PER: HON'BLE MR. JUSTICE R DEVDAS)

MFA No.5123/2024 is filed by the Royal Sundaram General Insurance Company Limited assailing the impugned judgment and award in MVC No.2815/2021 passed by the Motor Accident Claims Tribunal - 3, Bengaluru dated 12.06.2024. Cross appeal have been filed by the claimants in MFA cross objection No.62/2024 seeking enhancement of compensation.

2. The Insurance company is aggrieved of the fact that the Tribunal has arrived at a conclusion that since the deceased was a second year medical student, notional income at the rate of Rs.40,000/- per month should be taken for consideration. This, according to the appellant - Insurance Company is unjust and unreasonable, since admittedly the deceased was only a student and it cannot

HC-KAR

be concluded that the deceased was earning Rs.40,000/- per month as a student. Further, it is contented that the Tribunal has granted interest at the rate of 9% per annum, although the claim petition was filed in the year 2021 and a decision was made by the Tribunal by June 2024.

3. Per contra, the claimants, in their cross appeal have contended that even before a decision was rendered by the Tribunal in the month of June 2024, the Hon'ble Supreme Court had decided a similar case of a medical student on 04.08.2023 in the case of Bishnupriya Panda Vs. Basanti Manjari Mohanty and Another reported in 2023 ACJ 2393. Learned counsel submitted that in the said case, the accident occurred during July 2013 and the Tribunal took note of the fact that the deceased was a 4th year MBBS student aged about 21 years at the time of the accident and accordingly, took the notional income at Rs.50,000/- per month and therefore this Court is required to enhance the notional income, which was taken at

HC-KAR

Rs.50,000/- in the year 2013 and justly arrive at the notional income of the deceased medical student who died in the year 2021. Learned counsel would submit that the notional income as per the chart prepared by this Court for the year 2013 is Rs.8,000/- and in the year 2021, it is Rs.15,000/-. Therefore, the notional income is almost doubled between the year 2013 and 2021.

4. Having regard to the narrow compass within which the issue brought before this Court falls and having regard to the decision of the Hon'ble Supreme Court in the case of Bishnupriya Panda, this Court is required to consider the contention of the claimants/appellants in cross-objection. There is substance in the submission made by the learned counsel for the claimants that the notional income as per the chart prepared by this Court almost doubles the income when compared to 2013 and 2021. In addition, we also take note of the fact that the appellants herein being the parents of the deceased

HC-KAR

medical student, had borrowed a sum of Rs.25,00,000/- and Rs.19,56,000/- for the medical education of the deceased. In that regard, Ex.P.16 to Ex.P.45 have been marked before the Tribunal and it was contended by the claimants that the claimants have borrowed more than Rs.40,00,000/- from the Bank of Baroda for the medical education of the deceased and the same has to be repaid by the claimants to the bank. We also take note of the fact that the Tribunal has given due consideration to this aspect of the matter in paragraph No.26 of the impugned judgment and has held that under the provisions of the Motor Vehicles Act, compensation cannot be awarded for the purpose of repaying the educational loan borrowed by the claimants. Nevertheless, these aspects of the matter have to be given weightage while considering the claim or the appeal filed by the claimants seeking enhancement of the compensation. Escalation of the notional income would also depend on these aspects of the matter, although no compensation can be awarded on a different heading for

HC-KAR

the purpose of repaying the loan. In that view of the matter, we are of the considered opinion that the notional income in the present facts and circumstances of the case where the deceased was a second year medical student aged about 22 years during the year 2021 when the accident occurred, the notional income should be Rs.80,000/- per month in respect of the deceased medical student. All other things be equal, we proceed to work out the 'loss of future income', as follows:

(Rs.80,000/- + Rs.32,000/- (40%) towards 'future prospects' = Rs.1,12,000/-)

5. Since the deceased was a bachelor, the Tribunal has rightly deducted 50% of the income towards the personal expenses of the deceased. Applying the same principle and deducting 50% from Rs.1,12,000/-, the monthly income of the deceased would be Rs.56,000/-. The calculation therefore would be Rs.56,000/- X 12 X '18' = Rs.1,20,96,000/-.

HC-KAR

6. The decision of the Tribunal insofar as 'loss of consortium' is Rs.88,000; 'loss of estate' of Rs.18,000/- and 'funeral expenses and transportation expenses' Rs.18,000/- is just and proper. However, awarding interest at the rate of 9% per annum cannot be appropriate, having regard to the time spent by the claimants before the Tribunal and before this Court. We therefore reduce the rate of interest to 6% per annum.

7. The claimants are therefore, entitled to the compensation under the following heads: SL. No. Heads

Compensation Awarded by Tribunal Compensation Awarded by this Court

1. Loss of Dependency : Rs. 60,48,000/- 1,20,96,000/-

2. Loss of consortium : Rs. 88,000/- 88,000/-

3. Loss of estate : Rs. 18,000/- 18,000/-

4. Funeral expenses and transportation of dead body : Rs. 18,000/- 18,000/-

TOTAL

Rs. 61,72,000/- Rs.1,22,20,000/-

Enhancement

Rs. 60,48,000/-

HC-KAR

8. For the aforementioned reasons, this Court proceeds to pass the following: i) Both the appeals are allowed partly. The appeal filed by the Insurance Company succeeds in the matter of payment of interest.

ii) The cross-appeal filed by the claimants succeeds partly insofar as the calculation of loss of income and dependency. The compensation awarded by the Tribunal at the rate of Rs.61,72,000/- stands enhanced to Rs.1,22,20,000/-.

iii) Other directions/orders issued by the Tribunal insofar as apportionment and the release of amount is concerned, shall remain as ordered by the Tribunal.

HC-KAR

iv) The amount deposited by the Insurance Company before this Court is directed to be transferred to the Tribunal forthwith along with Trial Court records.

Ordered accordingly.

Sd/- (R DEVDAS) JUDGE

Sd/- (DR.K.MANMADHA RAO) JUDGE

GSR List No.: 1 Sl No.: 44