Allahabad High Court
THE NEW INDIA ASSURANCE CO. LTD.versusSMT. DIVYANJALI AND OTHERS
- Decided
- Bench
- PANKAJ BHATIA
Holding
The tribunal's assessment of income is upheld, but its quantum of compensation is altered to Rs.13,62,000 in line with Supreme Court precedents.
Summary
The appellant New India Assurance Co. Ltd. appealed against a tribunal award concerning compensation for the death of a contractor in a motor vehicle accident. The tribunal had fixed the deceased's monthly earnings at Rs.5,000, rejecting the claimant's claim of Rs.9,000, and the High Court accepted this assessment as correct. However, the court found the tribunal erred in calculating the quantum of compensation, relying on Supreme Court precedents (Sarla Verma, Magma General Insurance, and National Insurance Co. v. Pranay Sethi). Applying the principles from those cases, the court recomputed the compensation, incorporating future prospects, a multiplier of 17, and heads such as loss of estate, funeral expenses, and loss of consortium, arriving at a total of Rs.13,62,000. The court ordered payment of this amount with interest at 7% per annum, deducting any sums already paid, and directed the tribunal to disburse the balance within three months.
Issues considered
- Whether the tribunal correctly assessed the deceased's monthly income for compensation purposes
- Whether the quantum of compensation awarded by the tribunal is in accordance with Supreme Court jurisprudence on motor accident claims
Subjects
- motor accident
- compensation
- loss of earnings
- multiplier
- interest
- insurance claim
- tribunal award
- quantum of damages
Judgment
HIGH COURT OF JUDICATURE AT ALLAHABAD
FIRST APPEAL FROM ORDER No. - 1698 of 2011
The New India Assurance Co. Ltd.
.....Appellant(s)
Versus
Smt. Divyanjali And Others
.....Respondent(s)
Counsel for Appellant(s) : Aditya Singh Parihar
Counsel for Respondent(s) : Abhishek Kumar Yadav, Kamal Singh,
Ram Singh
Court No. - 50
HON'BLE PANKAJ BHATIA, J.
1. Heard the counsel for the appellant Insurance Company the counsel for
the claimant respondents.
2. The appeal has been preferred against the award dated 15.03.2011. The
cross objection have also been filed for enhancement of the compensation by
the claimants.
3. As, the only issue agitated is with regard to the quantum of compensation,
the same is being considered by this Court. The deceased died in a motor
vehicle accident. It was claimed that the deceased was working as a
Contractor with PWD and was earning Rs.9000/- per month, however the
Tribunal after appreciating the evidence on record, admitted the income to
be Rs.5000/- per month. No evidence could be adduced by either of the
parties to suggest that the said conclusion of the Tribunal is erroneous, as
such, the income of the deceased assessed at Rs.5000/- appears to be correct
requiring no interference. However, the Tribunal has erred while awarding
the compensation which is primarily in ignorance of law and clarified by the
Hon'ble Supreme Court in the cases of Sarla Verma and others vs. Delhi
Transport Corporation and another; Civil Appeal No.3483 of 2008
decided on 15.04.2009; Magma General Insurance Company Limited vs.
Nanu Ram Alias Chuhru Ram and others; (2018) 18 SCC 130 and
National Insurance Company Limited vs. Pranay Sethi and others; 2017
(4) TAC 673..
4. In view of the said three judgements, the quantum to which the claimants would be
entitled to work as under :
Sl.
Head Compensation awarded
No.
1. Monthly income of the deceased Rs.5,000/- per month
Adding 40% towards future prospects in
2. Rs.7,000/- per month
the light of the judgement in Pranaya
FAFO No. 1698 of 2011
2
Sethi's case (supra)
3. Net yearly income Rs.84,000/-
Rs.84,000 x 1/4th =
Rs.21,000/-
4. Deducting 1/4th towards personal expenses After deduction :
Rs.84,000 - Rs.21000 =
Rs.63,000/-
Rs.63,000 x 17 =
5. Applying multiplier of '17' as per
Rs.10,71,000/-
Amount under conventional heads:
(i) loss of estate Rs.18,500/- Rs.18,500 +
(ii) funeral expenses Rs.18,500/- as per Rs.18,500 +
6. Pranay Sethi's case (supra) Rs.2,91,000 =
(iii) loss of consortium Rs.48,500/- per
Rs.318000/-
person (Rs.48,500 x 6) as per Magma
General Insurance Company Limited
(supra)
Total amount of compensation
7. (Sr.No.5 + Sr.No.6) Rs. 13,62,000/-
5. The amount as recorded above shall be paid along-with interest @ 7% per
annum from the date of filing the claim petition till actual
payment/realisation. The said amount shall be paid within a period of three
months from today and the amount already paid as compensation shall be
deducted from the aforesaid amount to be paid to the claimant.
6. The amounts deposited before this court shall be transmitted to the
Tribunal for being paid to the claimants in terms of the directions issued.
(Pankaj Bhatia,J.)
May 7, 2026
VNP/-
Digitally signed by :-
VISHVANATH PRASAD SHUKLA
High Court of Judicature at Allahabad
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