SANTOSH DEVI AND ORS. versus MAHAVEER SINGH AND ORS. on 9 August 2018

SANTOSH DEVI AND ORS.

v.

MAHAVEER SINGH AND ORS.

(Civil Appeal No.7279 of 2018)AUGUST 09, 2018

[DIPAK MISRA, CJI, A.M. KHANWILKAR AND

DR. D.Y. CHANDRACHUD, JJ.]

Motor Vehicles Act, 1988 – s.166 – Death due to motoraccident in 1992 – Claim of appellants that the deceased was in thebusiness of selling desi ghee and namkin bhujia and his monthly incomewas Rs.3,500/- – Tribunal assessed the income of the deceased atRs.1,200/- p.m. and awarded Rs.1,15,200/- as compensation afterapplying a multiplier of 12 – High Court applied a multiplier of 15and increased the compensation to Rs. 1,85,000/- – On appeal,held: Assessment of income by Tribunal at Rs.1,200/- p.m. is on thelower side – Having due regard to the nature of the business, thedate of accident and all the circumstances of the case, income shouldhave been assessed at Rs.2,500/- p.m. – Deceased was 38 yearsold, hence, the correct multiplier would be 16 – Further, in view ofdecision of Constitution Bench in Pranay Sethi case an amount of40% is added towards future prospects – Compensation recomputed– Appellants entitled to Rs.5,23,000/-.

Person died when his moped was hit by jeep driven by thefirst respondent. Appellants, wife and children of the deceasedclaimed that his monthly income was Rs.3,500/-. Tribunalassessed the income of the deceased at Rs.1,200/-p.m. andawarded Rs.1,15,200/- as compensation after applying a multiplierof 12. High Court applied a multiplier of 15 and increased thecompensation to Rs. 1,85,000/-. Hence, the present appeal.

Allowing the appeal, the Court

HELD: 1.1 The assessment of income by the MACT atRs.1,200/- per month was on the lower side. The income shouldhave been assessed at Rs.2,500/- per month having due regardto the nature of the business, the date of accident and all the

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Acircumstances of the case. The deceased was 38 years old andhence the correct multiplier would be 16. In view of the decisionof the Constitution Bench in Pranay Sethi case, an amount of 40per cent is required to be added towards future prospects.Accordingly, the recomputed quantum of compensation isRs.5,23,000/- with interest @ 9 per cent per annum from theBdate of the petition until payment. [Paras 6, 7] [501-E-F; 502-C]

National Insurance Company Limited v Pranay Sethi(2017) 16 SCC 680 : 2017 (13) SCALE 12 – followed.

Case Law Reference

C2017 (13) SCALE 12 followedPara 6CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7279of 2018.

From the Judgment and Order dated 15.01.2016 of the High CourtDof Punjab & Haryana at Chandigarh in FAO No.740 of 1995.

Sanchal Anand, Devendra Singh, Advs. for the Appellants.

The Judgment of the Court was delivered by DR. D. Y. CHANDRACHUD, J. 1. The present appeal arisesfrom a judgment of a learned Single Judge of the Punjab and HaryanaEHigh Court at Chandigarh in a first appeal against an award of the MotorAccident Claims Tribunal, Hissar.

2. The appellants are the wife and children of PuranChand, whomet with a road accident on 30 December 1992. A government Jeep,bearing Registration No. HYH-100 dashed into his moped, bearingFRegistration No. HR-20-A-7236. Puran Chand sustained grievous injuriesand died.

3. The appellants filed a claim petition under Section 166 of theMotor Vehicles Act, 1988 before the MACT, seeking compensation ofRs. 10 lakhs. The MACT found that the Jeep was being driven rashlyGand negligently by the first Respondent on the wrong side of the road.The deceased was aged 38 years at the time of his death and was in thebusiness of selling desi ghee and namkinbhujia. The appellants claimedthat the monthly income of the deceased was Rs. 3,500. The MACT,however, held that the deceased was working in a small village; his shop H

SANTOSH DEVI AND ORS. v. MAHAVEER SINGH AND ORS.[DR. D.Y. CHANDRACHUD, J.]

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SANTOSH DEVI AND ORS. v. MAHAVEER SINGH AND ORS.[DR. D.Y. CHANDRACHUD, J.]

bore no name; he was not paying tax,hence his income was assessed atRs. 1,200 per month. Accordingly, the appellants were awarded an amountof Rs. 1,15,200 after applying a multiplier of 12, along with interest at 15per cent per annum.

4. In appeal, the High Court applied a multiplier of 15 and increasedthe compensation to Rs. 1,85,000. However, interest was reduced to 8per cent per annum.

5. The learned counsel appearing on behalf of the appellantsassailed the judgment of the High Court on the following grounds:

i. The High Court ought to have applied a multiplier of 16 sincethe deceased was 38 years of age;

ii. The High Court should not have made a deduction of more than10% for personal expenses;

iii. The High Court and the MACT erred in determining the incomeof the deceased at Rs. 1,200 per month whereas the deceasedwas earning Rs. 3,500 per month out of which, an amount ofRs. 3,000 was being spent for household expenditure;

iv. Accordingly, an amount of Rs. 16,34,600 should have been awardedto the appellants.

6. Having considered the record, we are of the view that theassessment of income by the MACT at Rs 1,200 per month is on thelower side. Taking a realistic view, the income should have been assessedat Rs 2,500 per month having due regard to the nature of the business,thedate of accident and all the circumstances of the case. The deceasedwas 38 years old and hence the correct multiplier would be 16. Followingthe decision of the Constitution Bench in National Insurance CompanyLimited v Pranay Sethi[1], an amount of 40 per cent is required to beadded towards future prospects. Accordingly, the quantum ofcompensation is recomputed as follows:

· Monthly income :Rs 2,500

· Annual income : Rs 30,000

· Deduction of one-third for personal expenses : Rs 10,000

· Net annual income : Rs 20,000

1 (2017) 16 SCC 680

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A· Future prospects at 40% : Rs 8,000

· Total income :Rs 28,000

· Multiplier : 16

· Total compensation for loss of dependency :Rs 4,48,000B· Addition for conventional heads in terms of Pranay Sethi:Rs.75,000

· Total compensation : Rs 5,23,000

7. The appellants would be entitled to interest at the rate of 9 percent per annum from the date of the petition until payment.C

8. The appeal is allowed in the above terms. There shall be noorder as to costs.

D

Divya Pandey

Appeal allowed.

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