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Supreme Court of India
Rahul Sharma vs National Insurance Company Ltd. on 7 May, 2021
Author: Hon’Ble The Justice
Bench: Hon’Ble The Justice, Surya Kant
NonReportable IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 1769 OF 2021 (ARISING OUT OF SLP (C) NO. 719 OF 2018) RAHUL SHARMA & ANR. …APPELLANT(S) VERSUS NATIONAL INSURANCE COMPANY …RESPONDENT(S) LTD. & ORS. JUDGMENT
N.V. RAMANA, CJI.,
1. Leave granted.
2. The appellants before us seek to impugn the judgment
dated 4th September, 2017, passed by the Delhi High Court in
MAC. App. No. 740/2016.
3. The brief facts, necessary for the adjudication of this
appeal are as follows: on the intervening night of the 18 th/19th
Signature Not Verified
Digitally signed by
May, 2010, the vehicle in which parents of the Appellants were
travelling rammed into a truck, near Phagwara, Punjab.
Resultantly, they succumbed to the injuries sustained in the
accident. The car was plying other relatives of the Appellants
and the deceased. Thereafter, F.I.R. no. 76/10, was registered
in PS Sadar Phagwara, Punjab under Sections 249, 304A,
427 of the Indian Penal Code, 1860 in this regard. It may be
relevant to note that the vehicle was, during the relevant
period, insured by the National Insurance Co. Ltd.
(hereinafter, referred to as NIC), the Respondent No. 1 herein.
4. The Appellants instituted a claim petition before the
Motor Accidents Claims Tribunal (hereinafter, “the MACT”),
under Sections 166 and 140 of the Motor Vehicles Act, 1988,
for grant of compensation for the death of their parents, which
were registered as cases numbered, MACT No. 349/2010 (with
respect to Mrs. Manisha Sharma) and MACT No. 350/2010
(with respect to Mr. Sunil Sharma), and were adjudicated vide
a common award dated 7th June, 2016.
5. The present appeal pertains to the claim petition
preferred on the account of the death of the appellants mother.
The appellants’ mother, Mrs. Manisha Sharma, was aged
about 37 years and was a selfemployed individual.
6. The Tribunal, while adjudicating the claim, determined
the compensation to be Rs. 41,55,235. The Tribunal relied
upon the Income Tax Return of the deceased and concluded
that her annual income was Rs. 2,55,349. Based on the
dictum of this Court in Sarla Verma v. Delhi Transport
Corporation, (2009) 6 SCC 121, 50% addition was included
towards future prospects and the multiplier was taken to be
15. Since, the deceased had two dependents, 1/3 rd of the
deceased’s income was deducted on account of personal and
living expenses. The nonpecuniary compensation was
calculated at Rs. 3,25,000. The NIC, being the insurer of the
vehicle, was held liable to pay the compensation of Rs.
41,55,235 with an interest of 9% per annum from the date of
filing of the claim petition.
7. Aggrieved, the insurance company preferred an appeal
against the award of the MACT before the Delhi High Court,
which disposed of the appeal vide the impugned judgment
dated 4th September, 2017. The High Court, in its common
judgement, calculated the pecuniary compensation as Rs.
19,16,000 and the nonpecuniary damages was calculated as
Rs.2,50,000, for a total compensation of Rs. 21,66,000/, in
MAC. APP. 740/2016. While passing the aforesaid impugned
order, the High Court deducted 50% of income towards
personal and living expenses. The High Court however, held
the deceased ineligible for the grant of future prospects as she
8. Aggrieved by the impugned judgement, the Appellants
have preferred the present appeal, by way of Special Leave,
impugning only the compensation as modified in MAC. App.
9. We have heard the counsel for the Appellants and the
counsel for the NIC, Respondent No. 1. The Respondents No. 2
and 3 have not tendered their appearances, despite service.
The insurance company has also placed on record their
written submissions, which have been perused.
10. This Court in a Five Judge Bench decision in National
Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680,
clearly held that in case the deceased is selfemployed and
below the age of 40, 40% addition would be made to their
income as future prospects. In the present case, the deceased
was selfemployed and was 37 years old, therefore, warranting
the addition of 40% towards future prospects. Moreover,
Pranay Sethi (supra), affirming the ratio in Sarla Verma
(supra), held that the deduction towards personal and living
expenses for a person such as the deceased who was married
with two dependents, to be onethird (1/3 rd). Since the High
Court in the impugned judgment deducted 50% the same
merits interference by this Court.
11. Therefore, in light of the above, the compensation as
awarded to the Appellants by the High Court is modified to the
extent of deduction towards personal and living expenses
(determined to be onethird (1/3 rd)) and 40% addition towards
future prospects. The annual income of the deceased (Mrs.
Manisha Sharma) was Rs. 2,55,349. After deducting personal
and living expenses and adding future prospects, the annual
income is determined at Rs. 2,38,326/. The multiplier of 15 is
appropriate, considering the age of the deceased. Accordingly,
the total loss of dependency, is calculated to be
Rs. 35,74,890/. We do not find any reason to interfere with
any other heads as determined by the High Court.
12. Hence, the total compensation is determined to be,
Rs. 38,24,890/ payable with interest of 9% per annum from
the date of filing of the claim petition till realisation, set off
against the part compensation already received, if any.
13. This Civil Appeal is disposed of in the aforesaid terms.
MAY 07, 2021