Holding

The multiplier for compensation under Section 173 must be determined by the age of the claimants, not the deceased, leading to a multiplier of 5 in the first case and 8 in the second.

Summary

The Supreme Court examined two motor accident death claims where the Motor Accidents Claims Tribunal had applied multipliers based on the age of the deceased to calculate loss‑of‑income compensation under Section 173 of the Motor Vehicles Act, 1988. In the first case, a 25‑year‑old deceased’s parents (both over 65) were awarded compensation using a multiplier of 17; the Court held that the multiplier must be based on the claimants’ age and reduced it to 5, fixing the award at Rs 2,10,000 with interest. In the second case, a 52‑year‑old deceased’s claimants were awarded using a multiplier of 13; the Court altered the multiplier to 8, recalculated loss of income on a monthly income of Rs 11,684 (after a one‑third personal expense deduction), and fixed the total award at Rs 7,73,500 with interest. The Court partially allowed the appeals, adjusting the compensation accordingly. The judgment clarifies that the multiplier for compensation is determined by the age of the claimants, not the deceased, and provides guidance on calculating loss of income and interest.

Issues considered

Whether the multiplier for compensation under Section 173 of the Motor Vehicles Act, 1988 should be based on the age of the deceased or the age of the claimants
Whether the multipliers of 17 and 13 applied by the Tribunal were appropriate in the respective cases
How to correctly compute loss‑of‑income compensation and interest in motor accident death claims

Legislation cited

Motor Vehicles Act, 1988s. 173

Subjects

Motor accidentCompensationMultiplierMotor Vehicles ActSection 173Loss of incomeDeath compensationSupreme Court

Judgment

-
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- ).--- NEW INDIA ASSURANCE COMPANY LTD. A
., v.
I
SMT. SHANTI PATHAK AND ORS.

JULY I 0, 2007

[DR. ARJJIT PASA YAT, P.K. BALASUBRAMANYAN AND D.K. JAIN, JJ.] B
~-
_..._ Motor Vehicles Act, J988-Motor accident-Death-Compensation-
Jn one case age of deceased was 25 years-Jn another case age of deceased
52 years-Tribunal awarding compensation-By applying multiplier of 17 in
case of 25 years old deceased-By applying multiplier of J3 in case of 25
c
years old deceased-Propriety of application of multiplier-Held: In case of
25 years old deceased multiplier altered to 5 in view of the advance age of
the claimants-In case of 52 years old deceased multiplier altered to 8 ~n
view of age of deceased-Compensations altered accordingly.
' ., D
In a case of motor accident, where the age of deceased was 25 years and
~
age of the claimant was 65 years and more at the time of accident, Motor
Accident Claim Tribunal awarded compensation applying multiplier of 17 in
view of age of the deceased.

In another case where the age of the deceased was 52 years, Tribunal E.
awarded compensation applying multiplier of 13. The appeals by appellant-
insurer were dismissed by High Court.

Hence the present appeals.

Partly allowing the appeals, the Court F
HELD: I. Considering the income that was taken, the foundation for
working out the compensation cannot be faulted. Considering the fact that
the matter is pending since long, it would be appropriate not to remit the case
back to High Court and to take the multiplier of5 considering the fact that
the mother of the deceased is about 65 years atthe time of the accident and G
age of the father is more than 65 years. Taking into account the monthly
... contribution at Rs. 3,500/- as held by the Tribunal and the High Court, the
entitlement of the claim would be Rs. 2,10,000/-. The same shall bear interest
@ 7.5% p.a. from the date of the application for compensation. Payment
237 a
238 SUPREME COURT REPORTS (2007) 8 S.C.R.

A already made shall be adjusted from the amount due. !Para 711239-E, F, GI ---..< - ;

2. In the case where the age of the deceased was 52 years as per the
t
post mortem report, and the multiplier thus has to be 8 instead of 13 as adopted
by the·Tribunal and upheld by the High Court. The rate of interest awarded
does not need any .interference. The monthly income has to be taken as Rs. ·
B 11, 684/- and one-third has to be deducted therefrom for personal expenses.
Thus, entitlement for loss of income comes to Rs. 7,44,000/-. The other
amounts awarded by the Tribunal totaling Rs. 29,500/- remain unaltered. Thus .
the claimant is entitled to Rs. 7,73,500 alongwith interest at the rate fixed by ._....
-,;..

the Tribunal The payment already made shall be adjusted. tpara 91
c CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 2926-2927 of
2007.

From the Final Judgment & Order dated 28.08.2004 and 31.03.2005 of the
High Court ofUttranchal at Nainital in Appeal from Order No. 233 of2004 and
Review Application No. 6554 of2004 in Appeal From Order No. 233 of2004
D
respectively.
>
WITH
....

C.A. No. 2928 of2007.
E S.L. Gupta, 8.K. Sharma and Goodwill Indeevar for the Appellant.

G.E. Vahanvati, SG., Binu Tamta, 8.K. Prasad, P.N. Puri, Kuldlp Singh,
R.K. Pandey, Sanjay Katyal, T.P. Mishra and Debasis Misra for the
Respondents.
F The Judgment of the Court was delivered by __.
DR. ARIJIT PASA YAT, J. C.ANOS. 2926-2927/07 @SLP ©Nos. 20101~
02/05. .

I. Leave granted .
.G
2. Challenge in this appeals is to the legality of the judgment rendered •
by a Division Bench of Uttranchal High Court dismissing the appeal filed
before I~ under Section 173 of the Motor Vehicles Act, 1988 (in short the 'Act'). ~
The Motor Accidents Claims Tribunal/Addi. Distrfot Judge, F.T.C. Nainital
H (hereinafter referred to as the 'tribunal') awarded a sum of Rs.4, 10,000/- in
NEWINDIAASSURANCECOMPANYLTD.v.SHANTIPATHAK[PASAYAT,J.] 239
favor of the respondents l and 2 (hereinafter referred to as the 'claimants'). A
3. The background facts which are almost undisputed essentially are as
follows:

4. On 11.11.2002 Hem Pathak (hereinafter referred to as the 'deceased')
who was at the relevant point oftirrie 25 years of age lost his life in a vehicular B
accident. He was traveling in Jeep No.UP 03/0805. The said jeep had a
collision with truck bearing No.UP 20A-849 I. Since the truck was the subject
matter of insurance, the parents of the deceased filed a Claim Petition. The
Tribunal as noted above awarded Rs.4, 10,000/-. Since the age of the deceased
was 25 years, multiplier of 17 was applied. The Tribunal referred to various C
decisions of this Court for quantifying the amount as Rs.4, l 0,000/-.

5. Before the High Court. it was contended by the appellant that the
multiplier to be adopted is to be :detennined on the age of the claimants and
not on the age of the deceased, which was to be taken as the basis for.
working out the compensation. The High Court did not find any substance. D ,
in this plea. It was held that no pennission had been granted to the insurer
to contest its claim. It was submittl!d that it is a clear case of contributory
negligence and the quantum of compensation should be suitably divided. The
High Court did not find any substance in this plea also.

6. In support of the appeal, learned counsel for the appellant submitted E
that both the trial Court and the High Court failed to notice the age of the..
claima!}ts which was relevant and not the age of the deceased.

7. Considering the income that was taken, the foundation for wo!king .·
out the compensation cannot be faulted. The monthly contribution was-:fjxed
at Rs.3,500/-. In the normal ~ourse we would have remitted the matte~ io_the F
High Court for consideration on the materials placed before it. But considering
the fact that the matter is pending since long, it would be appropriate-~Q tiike
the multiplier of 5 considering the fact that the mother of the deceased'.is
about 65 years at the time of the accident and age of the father is more than
65 years. Taking into account the monthly contribution at Rs.3,500/- as held G
by the Tribunal and the High Court, the entitlement of the claim '*otild be.
Rs.2, 10,000/-. The same shall bear interest@ 7.5% p~a. from.the 'date: ~fthe
__,),
application for compensation: Payment already .made shall be adjusted from ·
the amount due. .· . · . · .·

8. The appeal is disposed of accordingly with no order as to costs.
H
A
240 SUPREME COURT .REPORTS

9. In the instant case the age of the deceased was 52 years as per the
post mortem report, and the multiplier thus has to be 8 instead of 13 as
adopted by the Tribunal and upheld by the High Court. The rate of interest
awarded does not need any interference. The monthly income has to be taken
B as Rs. 11,684/- and one-third has to be deducted therefrom for personal
expenses. Thus, the annual loss of income comes to Rs.93,939/-. The same
is =rounded to Rs.93,000/-. The entitlement for loss of income comes to
Rs.7,44,000/-. The other amounts awarded by the Tribunal totaling Rs.29,500/
- remain unaltered. Thus the claimant is entitled to Rs.7,73,500 alongwith
C interest at the rate fixed by the Tribunal. The payment already made shall be
adjusted.
II
The appeals are allowed to the aforesaid extent with no order as to .•

costs.

K.K.T. Appea'ts partly allowed.

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