ABATI BEZBARUAH versus DIRECTOR GENERAL GEOLOGICAL SURVEY OF INDIA AND ANR.

Citation: [2003] 1 S.C.R. 1229 · Decided: 14-02-2003 · Supreme Court of India · Bench: S.B. SINHA · Disposal: Case Partly allowed

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Judgment (excerpt)

ABATI BEZBARUAH 
A 
\'. 
" 
DY'. DIRECTOR GENERAL GEOLOGICAL SURVEY OF 
INDIA AND ANR. 
< 
FEBRUARY 14. 2003 
B 
[S.B . SINHA AND DR. AR. LAKSHMANAN, JJ.] 
... 
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Motor Vehicles Act, 1988; Sections 166, 168 and 171: 
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Award of compensation-Quanlllm of compensation/Rate of Interest- c 
Discretion of the Tribunal/Courts-Held, compensation should be just and 
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fair as to the facts and circumstances of the case-Guidelines/Formula as per 
provision of law should be followed in computing compensation-Though 
there exists no rule in awarding interest, it is solely on the discretion of the 
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Tribunal/High Courts-However, bank rate prevailing at the relevant time D 
lt'ould normally be taken into consideration in awarding interest. 
Husband of the claimant-appellant, \Vas riding a scooter which 
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collided with a jeep and he died. Motor Accident Claims Tribunal awarded 
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certain amount of compensation of Rs. 2,50,200/- to the claimant and also 
directed payment thereof with interest@ 6% per annum. On appeal, High E 
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Court enhanced the amount of compensation and also rate of interest. 
Dissatisfied with the modified Award, the claimant preferred the present 
appeal . 
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It was contended for the appellant that High Court erred in 
awarding rate of interest on lower side than the prevailing rate of interest F 
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at the relevant time; and that quantum of compensation should be 
enhanced by applying multiplier of 16 instead of 15 keeping into 
consideration the age of the victim at the relevant time. 
On behalf of the respondent, it was submitted that in the light of G 
earlier decisions of the Supreme Court, multiplier of 10 should be 
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appropriate in calculating compensation and rate of interest @ 9% per 
annum would be reasonable/fair in the facts and circumstances of the case. 
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Partly allowing the appeal, the Court 
1229 
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1230 
SUPREME COURT REPORTS 
f2003l I S.C.R. 
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HELD: (Per Sinha, J.) : 
I. In the instant case, the victim at the relevant time was 40 years 
of age. The Tribunal and the High Court cannot be said to have committed 
an error in applying the multiplier of 15. Having regard to the prospects 
and advancement of the future career of the deceased, a higher estimate 
B of the yearly income of Rs. 45,000 would not be out of place. From the 
said amount, one-third of the gross income towards personal living 
expenses should be deducted. The amount so calculated viz. Rs. 30,000 
should, thus be determined as the loss of dependency. The said sum should 
then be capitalized by applying the multiplier of 15 which comes to Rs. 
C 4,50,000. 11233-F, H; 1234-AI 
2.1. Rate of interest on compensation/Award would depend upon the 
facts and circumstances of each case. Award of interest would normally 
) 
depend upon the bank rate prevailing at the relevant time. The amount 
of interest should, having regard to the facts and circumstances of the case, 
D be paid at the rate of 9% per annum. 11232-H; 1233-A, q 
· 
Kaushnuma Begum (Smt.) and Ors. v. New India Assurance Co. ltd 
and Ors., 120011 2 SCC 9 and United India Insurance Co. ltd v. Patricia 
Jean Mahajan and Ors., 12002) 6 SCC 281, relied on. 
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R.l. Gupta and 0."s. v. Jupitor General Insurance Company and Ors., 
1199011 sec 356, referred to. 
2.2. It is a well settled principle of law that the payment of 
compensation on the basis of structured formula as provided for under 
the Second Schedule should not ordinarily be deviated from. Furthermore, 
F the amount of compensation should be just and fair in the facts and 
circumstances of each case. 11233-EJ 
Per Dr. Lakshmanan, J. (Supplementing): 
1.1. The rate of interest must be just and reasonable depending upon 
G the facts and circumstances of each case and taking all relevant factors 
including inflation, change of economy, policy being adopted by the 
Reserve Bank of ·India from time to time, how long the case is pending, 
permanent injuries suffered by the victim, enormity of suffering, loss of 
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future income, loss of enjoyment of life etc., into consideration. 11234-C-EI 
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1.2. No rate of interest is fixed under Section 171 of the Motor 
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ABATI BEZRARUAH " DY IJIR. GEN GEO SURVEY OF !NOIA [S.B. SINHA.JI 1231 
Vehicles Act. Varying rates of·interest are being awarded by Tribunals, A 
High Courts and the Supreme Court. Interest can be granted enn if 
claimant docs not specifically plCad for the same as ii is consequential in 
ti•• eye of law. Interest is compensation

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