The legal analysis in the recent case underscores the crucial need to revise notional income figures in compensation cases under the Motor Vehicles Act. The Court’s emphasis on updating Schedule-II to reflect the current cost of living is essential for ensuring just compensation for victims and their families. Stay tuned for more insights on the intersection of law and societal changes.
Facts
- The driver of the motorcycle, Mr. Sunil Gurum, did not possess a valid driving license at the time of the accident.
- The Tribunal directed the insurance company to pay compensation to the claimants and recover the same from the owner of the motorcycle.
- The insurance company filed for enhancement of compensation citing contributory negligence.
- The claimants, parents of the deceased 7-year-old boy, filed for compensation in the High Court.
- The Tribunal concluded that the accident was caused by the rash and negligent driving of the motorcycle’s driver, Sunil Gurum.
- The Tribunal awarded compensation of Rs.2,25,000 considering the deceased’s notional income at Rs.15,000 per annum using a multiplier of ’15’, with interest at 6% per annum from the date of judgment.
- The appellants filed a Claim Petition under Section 163-A of the Motor Vehicles Act, 1988 claiming compensation for the death of their son in a road accident.
- The High Court partly allowed the appeal by awarding Rs.15,000 towards funeral expenses on top of the compensation of Rs.2,40,000 already awarded by the Tribunal.
- The appellants argued that the compensation awarded is low and unjust, seeking a higher amount.
- The Insurance Company, represented by Sri V.S. Chopra, was also part of the appeal proceedings.
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Arguments
- The Government was obligated to amend Schedule-II as per Section 163-A(3) of the Motor Vehicles Act 1988, but it has remained unchanged since 1994.
- The notional income fixed in 1994 needs to consider the increase in the cost of living.
- Judgments like Puttamma & Ors. v. K.L. Narayana Reddy & Anr., R.K. 4 Malik & Anr. v. Kiran Pal & Ors., and Kishan Gopal & Anr. v. Lala & Ors. support revising the notional income.
- Compensation under Section 163-A of the Motor Vehicles Act 1988 is based on a notional income of Rs.15,000 per annum fixed in 1994.
- The notional income figure of Rs.15,000 has not been amended despite repeated directions from the Court.
- The Tribunal awarded compensation based on the notional income of the deceased at Rs.15,000 per annum by applying a multiplier of ’15’.
- A sum of Rs. 2,25,000 was awarded towards loss of dependency, with interest at 6% per annum from the date of judgement.
- The learned counsel for the respondent Insurance Company argued that there are no grounds to interfere with the High Court’s judgement, citing a previous case – Rajendra Singh & Ors. v. National Insurance Company Limited & Ors.
- The claim in this case was made under Section 163-A of the Motor Vehicles Act 1988, and the Tribunal considered notional income as per Schedule-II for compensatory purposes.
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Analysis
- The Central Government was directed to amend Schedule-II as per Section 163-A(3) of the Motor Vehicles Act 1988 but has not done so.
- Specific directions were given to the Central Government to update Schedule-II considering the current cost of living.
- In the Puttamma & Ors. case, compensation amounts were fixed at Rs.1,00,000/- for non-earning children up to 5 years old and Rs.1,50,000/- for non-earning persons above 5 years old until Schedule-II is amended.
- Notional income of Rs.15,000/- per annum for non-earning members was considered unjust and unreasonable.
- Despite repeated directions, Schedule-II remains unamended since the accident on 06.09.2004.
- In view of judgments in Puttamma & Ors., R.K. Malik & Anr., and Kishan Gopal & Anr., there is a decision to increase the notional income by considering inflation, devaluation of the rupee, and the cost of living.
- In the case of R.K. Malik & Anr., the notional income fixed under Section 163-A of the Motor Vehicles Act, 1988 at Rs. 15,000 per annum has been deemed necessary for enhancement due to no amendment since 14.11.1994.
- In the case of Kishan Gopal & Anr., where the deceased was a ten-year-old child, the notional income was fixed at Rs. 30,000 per annum.
- The judgment in the case of Rajendra Singh & Ors. does not support the argument of the insurance company.
- The reliance on the Rajendra Singh case by the insurance company’s counsel does not apply to the current situation.
- The judgment cited by the insurance company does not assist their case.
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Decision
- Appellants entitled to Rs.40,000 each towards filial consortium and Rs.15,000 towards funeral expenses.
- Total compensation amounts: Rs. 3,75,000 for loss of dependency, Rs. 80,000 for filial consortium (Rs.40,000 x 2), Rs. 15,000 for funeral expenses.
- Total compensation awarded: Rs. 4,70,000.
- Compensation to be paid by respondent No.2 – Insurance Company with the option to recover from respondent No.1.
- Interest of 6% per annum on the total compensation amount from the date of claim petition to realization.
- Notional income of the deceased estimated at Rs.25,000 per annum.
- Loss of dependency calculated at Rs.3,75,000 (Notional income x Multiplier 15).
- Enhanced compensation granted due to driver not possessing a valid driving license on the date of the accident.
Case Title: KURVAN ANSARI ALIAS KURVAN ALI Vs. SHYAM KISHORE MURMU (2021 INSC 734)
Case Number: C.A. No.-006902-006902 / 2021
