Supreme Court of India
SMT. SUNITA TOKAS & ANR.versusNEW INDIA INSURANCE CO. LTD. & ANR.
- Citation
- 2019 INSC 912
- Decided
- 16 August 2019
- Disposal
- Appeal(s) allowed
- Bench
- INDU MALHOTRA
Holding
The multiplier for compensation under Section 166 must be determined with reference to the age of the deceased, not the age of the dependants, and future prospects are to be awarded at 40% of the notional income.
Summary
The parents of 21‑year‑old Pradeep Tokas filed a claim under Section 166 of the Motor Vehicles Act after he died as a pillion rider in a collision with a stationary truck. The Motor Accident Claims Tribunal (MACT) awarded compensation based on a notional monthly income of Rs 16,246, a multiplier of 15 derived from the mother’s age, and future prospects of 50%. The Delhi High Court reduced the award, fixing the notional income at Rs 7,500 and retaining the same multiplier, prompting the appellants to seek enhancement before the Supreme Court. The Court examined whether the multiplier should be calculated on the basis of the deceased’s age or that of the dependants, and whether future prospects should be granted. Relying on a line of precedents, the Court held that the multiplier must be linked to the age of the deceased, fixing it at 18 for a 21‑year‑old, and awarded future prospects at 40% of the notional income, setting the notional income at Rs 12,000 per month. Consequently, the compensation was enhanced by Rs 11,39,400 and the insurance company was directed to pay the increased amount with interest. The appeal was allowed.
Issues considered
- Whether the multiplier under Section 166 of the Motor Vehicles Act should be based on the age of the deceased or the age of the dependants in a case involving a bachelor.
- Whether the notional monthly income of the deceased should be as assessed by the MACT or reduced by the High Court.
- Whether future prospects are to be awarded and, if so, at what percentage of the notional income.
- Whether the amounts awarded for loss of love and affection, loss of estate and funeral expenses by the High Court should be upheld.
Legislation cited
- Motor Vehicles Act, 1988s. 166
Subjects
Motor Vehicles ActSection 166CompensationMultiplierLoss of dependencyFuture prospectsBachelorNotional incomeSupreme Court
Judgment
616 [2019]
SUPREME COURT 10 S.C.R. 616
REPORTS [2019] 10 S.C.R.
A SMT. SUNITA TOKAS & ANR.
v.
NEW INDIA INSURANCE CO. LTD. & ANR.
(Civil Appeal No. 6339 of 2019)
AUGUST 16, 2019
B
[INDU MALHOTRA AND SANJIV KHANNA, JJ.]
Motor Vehicles Act, 1988: s.166 – Multiplier in case of a
bachelor – Appellants are parents of the victim-deceased – The case
of the appellants was that on the fateful day, victim-deceased was
travelling as a pillion rider of a two-wheeler – The two-wheeler
C dashed against stationary truck standing in the middle of the road
– Both the driver and the pillion rider died on the spot – Victim-
deceased was 21 years old at the time of accident – MACT assessed
notional income of the deceased at Rs.16246 p.m. and a multiplier
of 15 based on the age of mother of the deceased and accordingly
D determined compensation – High Court reduced compensation by
assessing notional income of the deceased at Rs.7500 p.m. – Appeal
by parents of the deceased for enhancement of compensation –
Held: Multiplier is to be applied on the basis of the age of the
deceased, and not on the basis of the age of the dependants – In
the instant case, since the deceased was 21 years old, the Multiplier
E would be 18 as per the table set out in the Sarla Verma case – Further,
High Court erred in reducing the notional income of the deceased
from Rs. 16,246/- as awarded by the MACT to Rs. 7,500/- – The
deceased was a trained swimmer who had won several State-level
competitions and certainly had the potential to earn a living by
F utilizing his skills – In such circumstances, notional monthly income
of the deceased fixed at Rs. 12,000/- – Further, addition of Future
Prospects made at 40% of the notional income of the deceased, as
per the judgment of the Constitution Bench in Pranay Sethi – The
amounts awarded by the High Court under the heads of loss of love
and affection, loss of estate, funeral expenses, and the Interest
G awarded by the MACT, are however, maintained.
Allowing the appeal, the Court
HELD : 1. There are a catena of judgments rendered by
this Court, wherein it has been held that the Multiplier has to be
H
616
SMT. SUNITA TOKAS v. NEW INDIA INSURANCE CO. LTD. 617
applied on the basis on the age of the deceased, and not on the A
basis of the age of the dependants. [Para 4] [621-D]
Munna Lal Jain & Ors. v. Vipin Kumar Sharma & Ors.
(2015) 6 SCC 347 : [2015] 7 SCR 207 ; National
Insurance Company Limited v. Pranay Sethi & Ors.
(2017) 16 SCC 680 ; Royal Sundaram Alliance B
Insurance Co. Ltd. v. Mandala Yadagari Goud & Ors.
(2019) 5 SCC 554 – followed.
Sarla Verma & Ors. v. Delhi Transport Corporation &
Anr. (2009) 6 SCC 121 : [2009] 5 SCR 1098 ; New
India Assurance Co. Ltd. v. Shanti Pathak & Ors. (2007) C
10 SCC 1 : [2007] 8 SCR 237 ; Reshma Kumari & Ors.
v. Madan Mohan & Ors. (2013) 9 SCC 65 : [2013] 2
SCR 706 ; Amrit Bhanu Shali & Ors. v. National
Insurance Co. Ltd. & Ors., (2012) 11 SCC 738 : [2012]
5 SCR 207 ; Sube Singh & Ors. v. Shyam Singh
(dead) & Ors. (2018) 3 SCC 18 : [2018] 1 SCR 636 D
– relied on.
2. In the instant case, since the deceased was 21 years
old, the Multiplier of 18 was applicable as per the table set out in
the Sarla Verma case. The deceased was a trained swimmer who
had won several State-level competitions. His mother runs a E
Swimming/Gym Centre at Air Force Station (Central School),
Gurgaon. Therefore, the deceased certainly had the potential to
earn a living by utilizing his skills. In such circumstances, it is
appropriate to fix the notional income of the deceased @Rs.
12,000/- p.m. The Courts below failed to grant Future Prospects F
@40% of the notional income of the deceased, as per the
judgment of the Constitution Bench in Pranay Sethi. The amounts
awarded by the High Court under the heads of loss of love and
affection, loss of estate, funeral expenses, and the Interest
awarded by the MACT, are however, maintained. [Paras 4.8- 4.11]
[624-E-H; 625-A-B] G
Case Law Refcrence
[2009] 5 SCR 1098 relied on Para 3.1
[2007] 8 SCR 237 relied on Para 3.3
H
618 SUPREME COURT REPORTS [2019] 10 S.C.R.
A [2013] 2 SCR 706 relied on Para 4.2
[2012] 5 SCR 207 followed Para 4.3
[2015] 7 SCR 207 followed Para 4.4
[2018] 1 SCR 636 relied on Para 4.5
B (2017) 16 SCC 680 followed Para 4.6
(2019) 5 SCC 554 followed Para 4.7
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6339
of 2019.
C From the impugned Judgment and Order dated 01.08.2017 of the
High Court of Delhi at New Delhi in MACA No.323 of 2017.
Manish Maini, Ms. Manjeet Chawla, Y.R. Sharma, O.P. Maini,
Advs. for the Appellants.
Rajesh Kumar Gupta, Adv. for the Respondents.
D
The Judgment of the Court was delivered by
INDU MALHOTRA, J. Leave granted.
1. The present Civil Appeal has been filed to challenge the final
Judgment and Order dated 01.08.2017 passed by the High Court of
E Delhi in MAC. APP. No. 323 of 2017.
The Appellants herein have filed the present Civil Appeal for
enhancement of the compensation granted by the Motor Accident Claims
Tribunal, Patiala House Courts, New Delhi (“MACT”) and the High
Court.
F
2. The factual matrix in which the present Civil Appeal arises is
briefly stated as under :–
2.1. The son of the Appellants viz. Pradeep Tokas was a
student who was a trained swimmer, and had won prizes
in State-level events.
G
2.2. On 11.05.2004, Pradeep Tokas was sitting on a two-
wheeler as a pillion rider, while travelling on the Upper
Ridge Road towards Karol Bagh, New Delhi.
At 1:05 a.m., the said two-wheeler met with an
H accident with a stationary Truck bearing Registration
SMT. SUNITA TOKAS v. NEW INDIA INSURANCE CO. LTD. 619
[INDU MALHOTRA, J.]
No. HR-51-GA-0525, which was not visible at night. A
The truck was standing in the middle of the road without
any indicator lights on. The two-wheeler dashed against
the stationary truck, and both Pradeep Tokas and the
driver died on the spot. Pradeep Tokas was 21 years old
at the time of his death.
B
2.3. The Appellants herein are the parents of the deceased,
who filed the Claim Petition before the MACT, Patiala
House Courts, New Delhi claiming compensation on the
death of their son.
2.4. The MACT vide Award dated 25.05.2009 granted C
compensation of Rs. 14,87,140/- along with interest
@7% p.a. to the Appellant -Claimants.
The compensation was awarded under the following
heads :–
(i) The notional income of the deceased was D
assessed @Rs. 16,246/- p.m. after adding Future
Prospects @50%;
(ii) Deduction of 50% towards personal expenses
was made from the notional income of the
deceased, since he was a bachelor; E
(iii) The MACT applied the Multiplier of 15 on the
basis of the age of the mother of the deceased;
(iv) Rs. 25,000/- was awarded towards loss of love
and affection;
F
(v) Rs. 10,000/- was awarded towards loss of
estate and consortium;
(vi) Rs. 5,000/- was awarded towards funeral
expenses.
2.5. Aggrieved by the aforesaid Award, the Appellants filed G
MAC. APP. 323 of 2017 before the Delhi High Court
for enhancement of compensation.
The Respondent – Insurance Company also filed a
cross-Appeal for reduction of compensation.
H
620 SUPREME COURT REPORTS [2019] 10 S.C.R.
A The High Court vide the impugned common Judgment
and Order dated 01.08.2017 dismissed the Appeal filed
by the Appellant – Claimants, and allowed the Appeal
filed by the Respondent – Insurance Company in part.
The High Court reduced the amount of compensation
B awarded by the MACT to Rs. 9,25,000/-. The High
Court awarded the following amounts under various
heads :
(i) The notional income of the deceased was
assessed @Rs. 7,500/- p.m.;
C (ii) Deduction of 50% was made from the notional
income of the deceased towards personal
expenses, since the deceased was a bachelor;
(iii) Multiplier of 15 was applied on the basis of the
age of the mother of the deceased;
D
(iv) Rs. 2,00,000/- was awarded towards loss of love
and affection;
(v) Rs. 50,000/- was awarded towards loss of
estate and funeral expenses.
E 3. Aggrieved by the aforesaid Judgment, the Appellant – Claimants
have filed the present Civil Appeal for enhancement of the compensation
awarded.
We have heard the learned Counsel for the Appellants and the
Respondent – Insurance Company.
F 3.1. The Counsel for the Appellants inter alia submitted that
the MACT and the High Court had erroneously applied
the wrong Multiplier of 15, on the basis of the age of the
mother of the deceased.
It was submitted that the Multiplier of 18 ought to have
G been applied on the basis of the age of the deceased, as
per the table set out in the judgment of this Court in
Sarla Verma & Ors. v. Delhi Transport Corporation
& Anr.1
1
H (2009) 6 SCC 121.
SMT. SUNITA TOKAS v. NEW INDIA INSURANCE CO. LTD. 621
[INDU MALHOTRA, J.]
3.2. It was further submitted that the High Court erred in A
fixing the notional income of the deceased @7,500/- p.m.,
and did not award Future Prospects.
3.3. On the other hand, the Counsel for the Insurance
Company inter alia submitted that the Courts below
were justified in applying the Multiplier of 15 as per the B
age of the mother of the deceased, and not the age of
the deceased who was a bachelor. Reliance was placed
on the decision in New India Assurance Co. Ltd. v.
Shanti Pathak & Ors.2
4. We have perused the judgments of the Courts below, and find C
that the Multiplier has been fixed on the basis of the age of the mother of
the deceased boy.
The issue with respect to whether the Multiplier to be applied in
the case of a bachelor, should be computed on the basis of the age of the
deceased, or the age of the mother, is no longer res integra. There are D
a catena of judgments rendered by this Court, wherein it has been held
that the Multiplier has to be applied on the basis on the age of the deceased,
and not on the basis of the age of the dependants.
4.1. In Sarla Verma (supra), this Court held that :
“19. … Having regard to the age of the deceased E
and period of active career, the appropriate multiplier
should be selected. This does not mean ascertaining
the number of years he would have lived or worked
but for the accident. Having regard to several
imponderables in life and economic factors, a table F
of multipliers with reference to the age has been
identified by this Court. The multiplier should be
chosen from the said table with reference to the age
of the deceased.”
(emphasis supplied)
G
4.2. In Reshma Kumari & Ors. v. Madan Mohan & Ors.,3
a three judge bench of this Court held that :
2
(2007) 10 SCC 1.
3
(2013) 9 SCC 65. H
622 SUPREME COURT REPORTS [2019] 10 S.C.R.
A “36. In Sarla Verma, this Court has endeavoured to
simplify the otherwise complex exercise of assessment
of loss of dependancy and determination of
compensation in a claim made under Section 166. It
has been rightly stated in Sarla Verma 2009 (6) SCC
121 that claimants in case of death claim for the
B
purposes of compensation must establish (a) age of
the deceased; (b) income of the deceased; and (c)
the number of dependants. To arrive at the loss of
dependency, the Tribunal must consider (i) additions/
deductions to be made for arriving at the income;
C (ii) the deductions to be made towards the personal
living expenses of the deceased; and (iii) the
multiplier to be applied with reference to the age of
the deceased. We do not think it is necessary for us
to revisit the law on the point as we are in full
agreement with the view in Sarla Verma 2009 (6) SCC
D
121.”
(emphasis supplied)
4.3. In Amrit Bhanu Shali & Ors. v. National Insurance
Co. Ltd. & Ors.,4 this Court held that the selection of
E multiplier is based on the age of the deceased, and not
on the basis of the age of the dependants. There may be
a number of dependants of the deceased, whose ages
would vary. Therefore, the age of the dependants would
have no nexus with the computation of compensation.
F 4.4. Another three judge bench of this Court in Munna Lal
Jain & Ors. v. Vipin Kumar Sharma & Ors.,5 discussed
the issue as to whether the multiplier should depend on
the age of the dependants, or that of the deceased. This
Court held that the issue had been decided in Reshma
Kumari (supra), wherein it was held that the multiplier
G to be used, must be with reference to the age of the
deceased. The Court cited para 36 of the judgment in
Reshma Kumari (supra), and held that :
4
(2012) 11 SCC 738.
5
H (2015) 6 SCC 347.
SMT. SUNITA TOKAS v. NEW INDIA INSURANCE CO. LTD. 623
[INDU MALHOTRA, J.]
“11. The remaining question is only on multiplier. A
The High Court following Santosh Devi (supra), has
taken 13 as the multiplier. Whether the multiplier
should depend on the age of the dependants or that
of the deceased, has been hanging fire for sometime;
but that has been given a quietus by another three-
B
Judge Bench decision in Reshma Kumari (supra). It
was held that the multiplier is to be used with
reference to the age of the deceased. One reason
appears to be that there is certainty with regard to
the age of the deceased but as far as that of
dependants is concerned, there will always be room C
for dispute as to whether the age of the eldest or
youngest or even the average, etc., is to be taken.”
(emphasis supplied)
4.5. The decision in Munna Lal Jain (supra) was followed
by another three judge bench of this Court in Sube Singh D
& Ors. v. Shyam Singh (dead) & Ors.6
4.6. The Constitution Bench in National Insurance
Company Limited v. Pranay Sethi & Ors.,7 affirmed
the view taken in Sarla Verma (supra) and Reshma
Kumari (supra), and recorded in the conclusions as E
under :
“59.7. The age of the deceased should be the basis
for applying the multiplier.”
4.7. Recently the legal issue whether in case of a motor F
accident of a bachelor, the age of the deceased, or the
age of the dependants, would be taken into account, for
calculating the multiplier, came up for consideration
before a three judge bench of this Court in Royal
Sundaram Alliance Insurance Co. Ltd. v. Mandala
Yadagari Goud & Ors. 8 G
The Court referred to the earlier three judge bench
decision rendered in Munna Lal Jain (supra), which in
6
(2018) 3 SCC 18.
7
(2017) 16 SCC 680.
8
(2019) 5 SCC 554 H
624 SUPREME COURT REPORTS [2019] 10 S.C.R.
A turn relied upon the judgment in Sarla Verma (supra),
which has been affirmed by the Constitution Bench in
Pranay Sethi (supra). The Court also referred to the
three judge bench decision in Sube Singh (supra).
The Court after perusing all earlier judgments,
B observed that the judicial pronouncements had devised
a standard formula for calculation of the compensation
qua various components. The amount of compensation
is to be paid to the claimants who are dependants in the
event of the death of a person, based on what the
deceased would have contributed to their support. The
C amount received by the dependants becomes a part of
the estate, as they may live longer, or may be younger
than the age limits taken into account for calculation of
the multiplier to be applied in such a situation. In the
case of the death of a married person, it is an accepted
D norm that the age of the deceased would be taken into
account. The Court held that even in the case of a
bachelor, the same principle must be applied. The Court
held that once the law is settled, it should not repeatedly
be changed, since certainty of law is of crucial
importance, to avoid any confusion.
E
4.8. In the present case, since the deceased was 21 years
old, the Multiplier of 18 was applicable as per the table
set out in the Sarla Verma case.
4.9. The High Court erred in reducing the notional income
F of the deceased from Rs. 16,246/- as awarded by the
MACT, and reduced it to Rs. 7,500/.
The deceased was a trained swimmer who had won
several State-level competitions. His mother runs a
Swimming/Gym Centre at Air Force Station (Central
G School), Gurgaon. Therefore, the deceased certainly had
the potential to earn a living by utilizing his skills. In such
circumstances, we deem it appropriate to fix the notional
income of the deceased @Rs. 12,000/- p.m.
4.10. The Courts below failed to grant Future Prospects
@40% of the notional income of the deceased, as per
H
SMT. SUNITA TOKAS v. NEW INDIA INSURANCE CO. LTD. 625
[INDU MALHOTRA, J.]
the judgment of the Constitution Bench in Pranay Sethi A
(supra).
4.11. The amounts awarded by the High Court under the
heads of loss of love and affection, loss of estate, funeral
expenses, and the Interest awarded by the MACT, are
however, maintained. B
5. In light of the aforesaid discussion, the compensation awarded
to the Appellants is being enhanced as follows :
i) Income : Rs. 12,000/-
ii) Future Prospects : Rs. 4,800/-
(i.e. 40% of the income) C
iii) Deduction towards personal expenses : 50%
iv) Total income : Rs. 8,400/-
(i.e. 50% of 12,000 + 4,800)
v) Multiplier : 18
vi) Loss of future income : Rs. 18,14,400/-
D
(i.e. 8,400 x 12 x 18)
vii) Loss of love and affection : Rs. 2,00,000/-
viii) Loss of estate and funeral expenses : Rs. 50,000/-
Total : Rs. 20,64,400/-
Enhanced amount : Rs. 11,39,400/-
(i.e. 20,64,400 – 9,25,000) E
6. The Respondent – Insurance Company is directed to pay the
enhanced amount of Rs. 11,39,400/- to the Appellants within 1 month
from the date of this judgment.
The enhanced amount shall carry Simple Interest @7% p.a. from
the date of filing the Claim Petition till the date of realization. F
The Civil Appeal is allowed in the aforesaid terms. All pending
Applications, if any, are accordingly disposed of.
Ordered accordingly.
G
Devika Gujral Appeal allowed.
H
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