2015 (9) TMI 167 - SC - Indian Laws

Quantum of compensation - Compensation under Motor Vehicles Act, 1988 - Held that - Tribunal and the High Court have failed to consider the fact-situation of this case, without taking any pragmatic view and further without considering the price-index prevailing at the moment, assessed the compensation ignoring the principle laid down by this Court in the recent decisions and without revisiting the present situation, came to the conclusion and awarded the total compensation for a sum of 4,28,000/-. In our opinion, such award suffers from proper assessment of compensation awarded by the Tribunal, and High Court on the conventional heads, i.e., loss of consortium to the spouse, future prospects of the deceased and further the sum awarded under the head funeral expenses , cannot be said to be a just compensation. - compensation under the head loss of consortium to the spouse, loss of love, care and guidance to children and funeral expenses amounts should have been awarded under such heads, that is, for 1,00,000/- and 25,000/- respectively and we award such compensation under the said heads. So far as the head of salary is concerned, we do not express any opinion since we have found that the appellant could not prove the salary certificate and for such reason, we do not intend to interfere with the opinion expressed by the Tribunal on the established principle of notional income and accordingly, we do not want to disturb the said notional income while calculating the total compensation in favour of the appellant. - appellant is entitled to a sum of 6,55,400/- plus interest @ 8 per cent per annum from the date of filing of the claim petition till the date of payment as compensation. - Decided partly in favour of appellant.

Summary

Issues:
- Calculation of compensation amount based on notional income and personal expenses
- Assessment of compensation under various heads such as loss of consortium, future prospects, and funeral expenses
- Consideration of inflation factor and price-index while determining compensation

Analysis:
1. Calculation of Compensation Amount:
The Tribunal assessed the compensation based on the notional annual income of the deceased and deducted one-third share for personal expenses. The Tribunal considered the deceased's dependents and fixed the multiplier at 17. However, the appellant contested that the compensation did not include future prospects and the deduction for personal expenses was excessive. The Court referred to previous judgments to emphasize the need for a just compensation, considering the victim's income and potential future earnings. The Court recalculated the compensation, factoring in future prospects and personal expenses, resulting in an increased total compensation amount.

2. Assessment of Compensation under Various Heads:
The Tribunal awarded compensation for loss of consortium, funeral expenses, and other relevant aspects. The appellant argued that the compensation under these heads was inadequate and referred to specific cases to support her claim. The Court agreed that the compensation for loss of consortium and funeral expenses should be higher based on precedents. The Court reassessed the compensation under these heads, increasing the amounts to ensure a just and fair award.

3. Consideration of Inflation Factor:
The Court criticized the Tribunal and High Court for failing to consider the inflation factor and price-index while determining the compensation. The Court highlighted the importance of adjusting the compensation amounts to reflect the current economic conditions. By referring to previous judgments, the Court stressed the need to account for inflation and revisited the compensation awarded under various heads. The Court recalculated the compensation, factoring in the inflation factor, and increased the total compensation amount accordingly.

In conclusion, the Court modified the order of the Tribunal and High Court, directing an enhanced compensation amount of 6,55,400/- along with interest. The Court emphasized the importance of considering future prospects, inflation, and fair compensation principles while determining the total compensation awarded to the claimant.