Page 1

NON - REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NOs. 6091-6092 OF 2011

RAMILABEN CHINUBHAI PARMAR & ORS. …  APPELLANTS

VERSUS

NATIONAL INSURANCE CO. & ORS.  … RESPONDENTS

JUDGMENT

N.V. RAMANA, J.

The appellants herein are the claimants who filed a petition before the  

Motor Accident Claims Tribunal,  Ahmedabad claiming an amount of Rs.  

40.00 lakhs as compensation on the ground that the sole breadwinner of  

their  family,  who  was  46  years  old,  had  died  in  a  road  accident.  The  

Tribunal, relying upon the oral as well as documentary evidence, took the  

income of the deceased at Rs.15,000/- p.m. and considering his age at 46,  

applied  the  multiplier  12.   In  addition  to  that,  the  Tribunal  granted  

1

Page 2

Rs.50,000/- as conventional amount, and finally awarded Rs.22,10,000/- as  

compensation to the appellants with interest  @ 9% p.a.

2. Aggrieved  thereby,  the  respondent-Insurance  Company  preferred  

First Appeal No. 301 of 2003 before the High Court. The appellants herein  

also  filed  Cross  Objection  No.  107 of  2006 in  the said  appeal  seeking  

enhancement.  After hearing the Insurance Company as well as claimants,  

the High Court determined the net salary of the deceased as Rs.14,000/-  

p.m. by applying the multiplier 8, arrived at the compensation towards loss  

of dependency as Rs.13,44,000/-. It further added Rs.25,000/- for loss of  

estate and Rs.15,000/- for loss of consortium to the widow of the deceased  

and Rs.5,000/-  towards funeral  expenses. The High Court  ,  thus,  in all,  

awarded  a  total  amount  of  Rs.13,90,000/-  as  compensation  with  7.5%  

interest.  Thus,  the  High  Court  by  the  impugned  order  reduced  the  

compensation from Rs.22,10,000/- to Rs.13,90,000/- and reduced the rate  

of interest from 9% p.a. to 7.5% p.a.

3. Now  aggrieved  by  the  order  of  the  High  Court  the  claimants-

appellants filed these appeals for enhancement of compensation.

4. It is mainly contended by the learned counsel  for the appellants that  

the earning  capacity  of  the  deceased was Rs.35,000/-  p.m.  as per  the  

salary certificate and other documents, but the High Court has without any  

2

Page 3

reason,  reduced the compensation amount  by fixing Rs.14,000/-  as  the  

monthly salary of  the deceased. Similarly,  the High Court  has not  even  

considered the future prospects of the deceased who died at the young age  

of 46 years and the High Court has ignored the fact that 12 years service  

was left for the deceased on the date of death.

5. On  the  other  hand,  learned  counsel  for  the  Insurance  Company  

supported the order of the High Court and submitted that there is no reason  

for this Court to interfere with the order of the High Court.

6. We  have  heard  learned  counsel  for  the  parties  and  perused  the  

material before us. It is evident from the order of the Tribunal as well as  

Salary Certificate filed as (Annexure P-2) the deceased was getting a gross  

salary of  Rs.14,103.77 ps. p.m. apart from benefits like GPF, D.A.,  and  

other allowances. It  is also stated therein that the deceased was having  

another 12 years of service and there is a chance of revision of pay scales  

and getting one more promotion. Taking all these into consideration, the  

Tribunal arrived at a conclusion that the salary of the deceased would be  

Rs.35,000/- p.m. at the time of his retirement and Rs.25,000/- p.m. as his  

potential  earning  capacity  on  the  date  of  his  death.   After  deducting  

Rs.10,000/- towards personal expenses, his liability towards taxation etc.,  

the net contribution of the deceased towards his dependents was arrived at  

3

Page 4

Rs.15,000/- p.m., applied the multiplier 12 taking into consideration the age  

of the deceased and finally awarded an amount of Rs.22,10,000/- as total  

compensation payable with interest @ 9% p.a.  The High Court without  

properly appreciating the factum of the young age of the deceased and  

without  taking  future  prospects  of  the  deceased  into  consideration  has  

reduced the compensation from Rs.22,10,000/- to Rs.13,90,000/- and the  

rate of interest from 9% p.a. to 7.5% p.a.

7. Even though we are not convinced with the calculation and reasoning  

given  by  the  Tribunal,  but  keeping  in  view  the  peculiar  facts  and  

circumstances of the case, where the deceased died at an early age of 46  

years, had 12 more years of service, would have got promotions, resulting  

in hike in his pay and emoluments, we feel that ends of justice would be  

met if the potential earning capacity of the deceased is fixed at Rs.30,000/-  

p.m.  Accordingly, we fix the potential earning capacity of the deceased per  

month at Rs.30,000/- instead of Rs.25,000/- as fixed by the Tribunal. After  

deducting 1/3rd portion from Rs.30,000/- towards personal expenses, the  

dependency benefit for the appellants would come to Rs.20,000/- and the  

multiplier  applicable  is  12  taking  into  consideration  the  age  of  the  

deceased. Accordingly, the loss of dependency is fixed at Rs. 20,000 x 12  

x 12 = Rs.28,80,000/-.  In addition to that, the appellants are entitled to  

4

Page 5

Rs. 50,000/- as conventional amount as granted by the Tribunal.  Thus, the  

appellants would be entitled to a total compensation of Rs. 29,30,000/- with  

interest @ 7.5% p.a.

8. The  appeals  are  accordingly  allowed.  The  orders  passed  by  the  

Courts below are set aside. There shall be no order as to costs.

…………………………………………CJI. (P. SATHASIVAM)

……………………………………………J. (RANJAN GOGOI)

……………………………………………J. (N.V. RAMANA)

NEW DELHI, APRIL  23 , 2014  

5