Motor Accident Claims: No Restriction In Awarding Compensation Exceeding The Amounts Claimed By Claimants, Says SC [Read Judgment]

‘The function of the Tribunal or Court under Section 168 of the Motor Vehicles Act, 1988 is to award “just compensation”. ‘

There is no restriction to award compensation exceeding the amount claimed by the claimants, the Supreme Court has held.

Father, wife and two children of one Ismail, who died in a motor accident, had claimed a total compensation of Rs. 25,00,000 before the Motor Accidents Claims Tribunal and they were awarded Rs. 11,83,000. The high court, on their appeal, enhanced the compensation to Rs. 21,53,000. They approached the apex court claiming further enhancement.

The bench comprising Justice N.V. Ramana and Justice Mohan M. Shantanagoudar in Ramla vs. National Insurance Company Limited upheld the compensation awarded by the high court, but said that it should not have deducted 2/3rd of the total income towards the personal expenses of the deceased, while quantifying the compensation.

It said: “Taking into consideration the high cost of living at Doha, as observed by the High Court as well as the fact that the deceased was having his wife, two minor children and aged father as dependants and as there is no other earning member in the family of the deceased, in the facts and circumstances of the case, a deduction of 40% of the salary for the personal expenses would be appropriate for the purpose of quantifying compensation. Taking into consideration such 3 factors including the factor of uncertainties in the job in that Country as well as uncertainty in staying back in the said country for a longer period and in the absence of any material to show as to for how many years the deceased was having contract to serve, the claimants are entitled to a total compensation of Rs. 28,00,000/- inclusive of the compensation awarded by the High Court, with interest at the rate of 8% per annum from the date of filing the claim petition till its realization.”

The bench further observed that the claimants are entitled to compensation higher than what they have claimed. It said: “Though the claimants had claimed a total compensation of Rs.25, 00,000/- in their claim petition filed before the Tribunal, we feel that the compensation which the claimants are entitled to is higher than the same as mentioned supra. There is no restriction that the Court cannot award compensation exceeding the claimed amount, since the function of the Tribunal or Court under Section 168 of the Motor Vehicles Act, 1988 is to award “just compensation”. The Motor Vehicles Act is beneficial and welfare legislation. A “just compensation” is one which is reasonable on the basis of evidence produced on record. It cannot be said to have become time barred. Further, there is no need for a new cause of action to claim an enhanced amount. The Courts are duty bound to award just compensation.”

The bench then held that the claimants were entitled to a total compensation of Rs. 28,00,000.