In a significant legal case, the Supreme Court of India addressed the issue of the application of multipliers in compensation cases in the matter of Tokas v. Insurance Company. The Court discussed the calculation of compensation for the Tokas family following the tragic accident involving the late Pradeep Tokas. Stay tuned to know more about the Court’s decision and the enhancement of compensation in this case.
Facts
- Pradeep Tokas was a student and trained swimmer who had won prizes in State-level events.
- Pradeep Tokas was 21 years old at the time of his death.
- The accident occurred when Pradeep Tokas, as a pillion rider on a two-wheeler, collided with a stationary truck that was not visible at night.
- The MACT awarded compensation of Rs. 14,87,140 along with interest at 7% p.a.
- The Appellants, parents of Pradeep Tokas, filed the Claim Petition seeking compensation for the death of their son.
- The two-wheeler accident resulted in the deaths of Pradeep Tokas and the driver of the vehicle on the spot.
- Notional income of the deceased assessed at Rs. 7,500/- per month
- 50% deduction made from notional income for personal expenses as the deceased was a bachelor
- Multiplier of 15 applied based on the age of the deceased’s mother
- Rs. 2,00,000/- awarded for loss of love and affection
- Rs. 50,000/- awarded for loss of estate and funeral expenses
- High Court dismissed the Appeal filed by the Appellant – Claimants and partially allowed the Appeal by the Insurance Company
- Amount of compensation reduced to Rs. 9,25,000/- from the MACT awarded amount
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Issue
- The Multiplier has been fixed based on the age of the deceased boy’s mother in the judgments of the Courts below.
- The issue of calculating the Multiplier for a bachelor based on the deceased’s age or the mother’s age is no longer a new issue in legal precedents.
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Arguments
- Counsel for the Appellants argued that the Multiplier of 15 was applied wrongly based on the age of the deceased’s mother.
- Reference was made to the case of New India Assurance Co. Ltd. v. Shanti Pathak & Ors.
- Argument was put forward that a Multiplier of 18 should have been applied based on the age of the deceased as per the table in Sarla Verma & Ors. v. Delhi Transport Corporation & Anr.
- Contention was raised regarding the notional income of the deceased and the lack of award for Future Prospects.
- Insurance Company’s Counsel defended the application of Multiplier 15 based on the age of the deceased’s mother rather than the deceased himself who was unmarried.
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Analysis
- The age of the dependants does not have any impact on the computation of compensation.
- The multiplier to be applied should be based on the age of the deceased, not the age of the dependants.
- A table of multipliers with reference to the age of the deceased has been identified by the Court.
- The amount received by the dependants forms part of the estate, irrespective of their age.
- Judicial pronouncements establish a standard formula for calculating compensation.
- In Sarla Verma, the appropriate multiplier should be selected based on the age of the deceased and period of active career.
- The multiplier to be used must be with reference to the age of the deceased, even in the case of a bachelor.
- In the case of the death of a married person, the age of the deceased is taken into account for calculating the multiplier.
- Courts have consistently held that the multiplier is based on the age of the deceased and not the age of the dependants.
- The Court highlighted the need for certainty in determining the multiplier, which is easier with the age of the deceased than with the ages of multiple dependants.
Decision
- The compensation awarded to the Appellants is being enhanced with specific amounts allocated for different categories such as income, future prospects, personal expenses deduction, etc.
- The total enhanced amount to be paid by the Insurance Company to the Appellants is Rs. 11,39,400 within 1 month from the date of the judgment.
- The notional income of the deceased is fixed at Rs. 12,000 per month.
- Simple Interest of 7% per annum is to be applied on the enhanced amount from the date of filing the Claim Petition till realization.
- The amounts awarded by the High Court under various heads such as loss of love and affection, loss of estate, funeral expenses, and the interest awarded by the MACT are maintained.
- All pending applications are disposed of in light of the discussion and orders provided.
Case Title: SUNITA TOKAS Vs. NEW INDA INSURANCE CO. LTD.
Case Number: C.A. No.-006339-006339 / 2019
