'Deceased Was Multi Tasking, Not Doing 9-5 Job' : Supreme Court Enhances Motor Accident Compensation

The Supreme Court recently enhanced the compensation in a motor accident claim after taking note of the fact that the deceased was deriving income from multiple jobs. 

The Bench Comprising Justices C.T. Ravikumar and Rajesh Bindal, while reversing the High Court's decision which had reduced the claim amount of the claimant/appellant, observed that the assessment of the compensation to be paid to the claimant cannot be done with mathematical precision, but should be just and fair compensation.

“Assessment of compensation cannot be done with mathematical precision. The Motor Vehicles Act, 1988 also provides for assessment of just and fair compensation. In our opinion, considering the material placed on record by the appellants, as has been referred to above, and value of the labour being put in by the deceased in agriculture, it would be reasonable to assess his income at ₹35,000/- per month. Considering his age at the time of death as 52 years on the date of accident, the applicable multiplier would be as per the judgment of this Court in Sarla Verma (Smt.) and others v. Delhi Transport Corporation and another approved by this Court in National Insurance Company Ltd. v. Pranay Sethi and others.”, the Judgment authored by Justice Rajesh Bindal observed.

The Claim Tribunal decided the compensation to be ₹51,64,550/- based on a monthly salary of Rs. 50,000/-. The High Court has reduced the claim compensation from ₹51,64,550/- to ₹22,48,000/, considering the monthly salary of only Rs. 20,000/-.

Before the Supreme Court, it was contended by the appellant/LRs of the deceased beneficiary that the High Court had gone wrong in reducing the amount of income of the deceased from ₹50,000/- to ₹20,000/- per month. The appellant stated that the deceased was engaged in other activities from where he earned his income, but the High Court erred in computing the total compensation while not taking into account the additional income earned by him through other activities.

According to the appellant, the deceased had an additional income from other activities such as he had been supplying milk and coconuts, he was also growing paddy on his land, and received earnings from the banana grown on the land owned by him.

From the material placed on record by the appellants, the Supreme Court noted that besides generating income from the land owned by the family in the form of the sale of paddy and bananas, the deceased also had income from the supply of milk and coconuts to the school. There is also material available on record to show that he worked as a Government contractor.

“Meaning thereby, to make the lives of his family members comfortable, the deceased was multi-tasking and he was not engaged in a 9.00 to 5.00 P.M. job.”, the court noted.

Thus, the court observed that the income of the deceased deserves to be re-assessed as it is established that he was doing multiple works because the High Court on a very conservative basis assessed the income of the deceased at ₹20,000/- per month, bifurcating the same at ₹8,000/- per month for the supply of milk to the school, ₹5,000/- per month from agriculture and ₹7,000/- per month from working as a contractor.

“In our opinion, considering the material placed on record by the appellants, as has been referred to above, and the value of the labor being put in by the deceased in agriculture, it would be reasonable to assess his income at ₹35,000/- per month.”, the court said.

On that basis by applying 11 times multiplier to the sum of total dependency, the Supreme Court found that the appellant is entitled to compensation of ₹38,81,500/- with interest @8% from the date of filing of the claim petition till realization.

“Thus, the appellants are found entitled to compensation of ₹38,81,500/- with interest @8% from the date of filing of the claim petition till realization. Ordered accordingly. The judgment of the High Court is modified to the extent mentioned above.”, the court concluded.

Counsels For Petitioner(s) Mr. V. Chitambresh, Sr. Adv. Mr. Biju P Raman, AOR Ms. Usha Nandini V., Adv. Mr. John Thomas Arakal, Adv. Mr. Govind, Adv.

Counsels For Respondent(s) Mr. Pankaj Seth, Adv. Ms. Manjeet Chawla, AOR Mrs. Usha Pant Kukreti, Adv.

Case Title: VETHAMBAL AND OTHERS VERSUS THE ORIENTAL INSURANCE COMPANY AND OTHERS, CIVIL APPEAL NO. 3482 OF 2024

Citation : 2024 LiveLaw (SC) 206

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