24 June 2024


High Court of Delhi

The New India Assurance Co Ltd. Vs. Sujatha and Ors. (Neutral Citation: 2024:DHC:3638)



Motor Vehicles

Unless exceptional circumstances are shown, rate of interest awarded to the claimants should be 7.5% from date of filing of petition

The Appellant/insurance company has preferred present appeal in terms of Section 173 of Motor Vehicles Act, 1988 assailing the impugned judgment-cum-award passed by learned Presiding Officer, Motor Accidents Claims Tribunal, challenging the quantum of compensation awarded to the extent that the learned Tribunal has wrongly assessed compensation towards loss of financial dependency by not accounting or deducting the amount of certain allowances which were personal to the deceased.

Tribunal has committed certain irregularities in the assessment of compensation, which require to be corrected. As far as the loss of financial dependency is concerned, the last pay certificate of the deceased as on 6th April, 2012 was placed on the record and it clearly suggests that he was entitled to a transport allowance of Rs.1600 per month besides ration money of Rs.1,753. These two allowances which were personal to the deceased need to be deducted and the monthly income would be arrived at Rs.26,926. Annual income shall thus arrive at Rs.3,23,112 to which 50% has to be added towards future prospects after which the total annual income would be Rs.4,84,668.

Further, upon deducting one-third towards personal use and expenses, the amount of financial dependency would come to Rs.3,23,112 to which multiplier of '16' shall be applicable, and therefore, the loss of financial dependency would come to Rs.51,69,792. In terms of the decision by the Supreme Court in the case of National Insurance Company v. Pranay Sethi, each of the legal heirs of the deceased is to be awarded Rs.40,000 towards loss of consortium along with Rs.15,000 towards funeral expenses and Rs.15,000 towards loss of estate. Accordingly, the amount of compensation would come to Rs.52,79,792.

The learned Tribunal has awarded interest at 10% per annum. This Court has taken a consistent view that, unless exceptional circumstances are shown, the rate of interest that is to be awarded to the claimants should be 7.5% from the date of filing of the petition i.e. from 1st November, 2012 till realization. The amount of compensation is reduced to Rs.52,79,792 and the claimants shall be entitled to receive the same with interest @ 7.5% from the date of filing of the petition till realization.

Tags : Award Compensation Legality

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