101.
(SC) 30-09-2022
A. Motor Vehicles Act, 1988 (59 of 1988), Section 166, 168 -- Compensation in motor vehicle accident case -- Just compensation – Interference by Appellate Court – Power of -- Compensation must be fair, reasonable and equitable -- Further, the determination of quantum is a fact-dependent exercise which must be liberal and not parsimonious -- It must be emphasized that compensation is a more comprehensive form of pecuniary relief which involves a broad-based approach unlike damages -- Tribunals under the Act have been granted reasonable flexibility in determining ‘just’ compensation and are not bound by any rigid arithmetic rules or strict evidentiary standards to compute loss unlike in the case of damages -- Hence, any interference by the Appellate Courts should ordinarily be allowed only when the compensation is ‘exorbitant’ or ‘arbitrary’.
(Para 11)
B. Motor Vehicles Act, 1988 (59 of 1988), Section 166 -- Compensation in motor vehicle accident case – Whether tortious liability – Unlike tortious liability, which is chiefly concerned with making up for the past and reinstating a claimant to his original position, the compensation under the Act is concerned with providing stability and continuity in peoples’ lives in the future.
(Para 12)
C. Motor Vehicles Act, 1988 (59 of 1988), Section 166 -- Compensation in motor vehicle accident case – Income from Business Ventures and Investments – Relevance of -- Documents on record, noticed that almost all business ventures were the result of the initiatives taken by the deceased, and he was actively involved in the day-to-day management of these entities -- Mere fact that the deceased’s share of ownership in these businesses ventures was transferred to the deceased’s minor children just before his death or to the dependents after his death is not a sufficient justification to conclude that the benefits of these businesses continue to accrue to his dependents – Deceased was actively involved in the day-to-day administration of these businesses -- Entire amount from the business ventures is treated as income -- Similarly, the amount earned from the bank interests and remaining investments must also be included as income.
(Para 17)
D. Motor Vehicles Act, 1988 (59 of 1988), Section 166 -- Compensation in motor vehicle accident case – Income from House Property and Agricultural Land – Relevance of -- Bequeathed to his legal heirs on his death -- Whether the entire amount under ‘Income from House Property and Agricultural Land’ should be deducted or not – Held, appropriate approach is to determine the value of managerial skills along with any other factual considerations – Court deemed appropriate to award Rs 2,50,000/- as the amount for the Deceased’s managerial skills -- Said amount would also include the amount for the managerial skills in respect of the Deceased’s agricultural lands.
(Para 19-23)
E. Motor Vehicles Act, 1988 (59 of 1988), Section 166 -- Compensation in motor vehicle accident case – Income from Business Ventures and Investments – Income from House Property and Agricultural Land – Assessment of income:
-- Income from Business Ventures and Investments (FY 2000-2001 is Rs. 8,95,812/-, FY 2001-2002 is Rs. 10,31,091/-, FY 2002-2003 is Rs. 14,65,060/-, FY 2003-2004 is Rs. 9,79,099/-) average of these amounts comes up to Rs. 10,92,765.50/-, which is rounded off to Rs 10,93,000/- and the same is awarded to the Appellants as loss of income.
-- Income from House Property and Agricultural Land (FY 2000-2001 is Rs. 6,90,396/-, FY 2001-2002 is Rs. 6,47,127/-, FY 2002-2003 is Rs. 6,14,329/-, FY 2003-2004 is Rs. 4,78,240/-) average of these amounts comes up to Rs. 6,07,523/- -- Court deemed appropriate to award Rs 2,50,000/- as the amount for the Deceased’s managerial skills for it.
Total of two parts (Rs 10,93,000/- Rs 2,50,000/-) comes to Rs 13,43,000/- -- Forty per cent added towards future prospects, which would come to Rs 18,80,200/- -- After deducting one-fourth towards personal expenses the net amount comes to Rs 14,10,150/- per annum -- Applying the multiplier of 16, the total loss of dependency on account of the Deceased’s income is calculated at Rs 2,25,62,400/-, Funeral Expenses Rs 15,000/-, Loss of Estate Rs 15,000/-, Loss of Spousal Consortium Rs 40,000/-, Loss of Parental Consortium (Rs 40,000 x 2) = Rs 80,000/, Total compensation (1+2+3+4+5) Rs 2,27,12,400/- -- Interest @ 7.5% per annum shall be payable on the aforesaid amount from the date of filing the claim petition till the date of realization.
(Para 26)