In cases of Motor Accident Claims 1/4th of deceased income is to be deducted instead of 1/3rd considering the number of dependents of the deceased: Rajasthan High Court

In the cases of Motor Accident Claims, a deduction of 1/4th from the income of the deceased is to be made for personal expenses instead of 1/3rd considering the number of dependents on the deceased is upheld by the Jaipur Bench of Rajasthan High Court through a single Judge Bench of Hon’ble Mr. Justice Birendra Kumar in the case of Indra Devi and Others v. The India Insurance Company and Others (Civil Miscellaneous Appeal No. 5451/2008).

Brief facts of the case are that the petitioner appealed for the enhancement of compensation awarded by the Motor Accident Claims Tribunal, Jaipur of Rs. 8,74,000/- along with 6% interest against claimed Rs. 96,90,000/-. Deceased Mahaveer Prasad was a 33 year old Constable in Jaipur Police. The claimants argue that deceased widow, two children, his mother, and his brother (a teacher in Government School) are the dependants of the deceased. The Court upheld the tribunals order with regards to Brother as a dependant as he was not dependant on the deceased at the time of the accident.

The Petitioners further argued that 1/4th of the income of the deceased should be deducted for personal expenses as against 1/3rd as held in the case re Sarla Verma and affirmed by the Hon’ble Supreme Court in National Insurance Company Limited v. Pranay Sethi and Others, (2017) 16 SCC 680, considering the number of dependents being four in the instant case. Moreover, it is the contention of the petitioners that 16 should be used as the multiplier instead of 15 given that the deceased was between 30-35 years old.

The Respondents argued the breach of insurance policy as the driver only had the license for Light Motor Vehicle while he was driving Heavy Commercial Vehicle when the accident occurred. The court held that the insurer company cannot absolve its liability to compensate the victims and in case of breach of insurance policy they can recover the money from the owner of the vehicle who breached the policy.

The Court further held that the tribunal wrongly deducted 1/3rd for personal expenses and it should be 1/4th as opined in the Sarla Verma Judgement and subsequent cases and likewise considering the age of the deceased 16 should be used as a multiplier instead of 15. Therefore, from the yearly salary of Rs. 84,000/- 1/4th is deducted for personal expenses leading to Rs. 63,000/-. After multiplying it with 16 it comes to Rs. 10,08,000 and 50% should be added for under the head of future prospects. Under the conventional head (Consortium to Widow, mother, 2 minor children) Rs. 1,90,000 is to be added making the total compensation payable Rs. 17,02,000 along with 6% interest.

Judgement Reviewed by- Paras Jindal

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