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Motor Accident Compensation LawSupreme Court of India

Bhartiben Nayabha Ker and Ors. v. Sidabha Pethabha Manke and Ors.

Civil Appeal · 2018 INSC 305Decided 5 Apr 2018
Civil Appeal No. 2697 of 2018
Chief Justice Dipak Misra · Justice A.M. Khanwilkar · Dr. Justice D.Y. Chandrachud

Background

The appellants are the heirs of a man who died in a motor accident in 1993 when a truck collided head-on with the jeep he was travelling in. The Motor Accident Claims Tribunal awarded roughly Rs 7.78 lakh with 12% annual interest; on the claimants' first appeal, the Gujarat High Court added a modest amount for loss of life/consortium but reduced the interest rate to 9% per annum. The claimants then appealed to the Supreme Court, arguing the High Court had failed to add anything for "future prospects" and had wrongly cut the interest rate.

Decision Breakdown

Applying the Constitution Bench ruling in National Insurance Co. Ltd. v. Pranay Sethi, the Supreme Court held that a 25% addition for future prospects was warranted given the deceased's age, raising his annual income for compensation purposes and, applying a multiplier of 14 plus conventional-head amounts, increased the total compensation to Rs 12,67,000. On the interest point, the Court, after a corrigendum clarified the figures, declined to interfere with the High Court's rate of 9% per annum, rejecting the claimants' bid to have it altered. The appeal was allowed to the extent of enhancing the compensation amount, with interest at 9% p.a. payable from the date of the claim petition, and no order as to costs.

Lesson Learnt

Motor accident compensation isn't fixed once and for all at the tribunal stage: the Supreme Court's own precedent on "future prospects" (a standard addition for a deceased's likely future income growth) can still enhance the payout years later, even while the court leaves an already-fixed interest rate undisturbed.

Bhartiben Nayabha Ker and Ors. v. Sidabha Pethabha Manke and Ors. – Legal Case Shots | LegalAware