RELIANCE GENERAL INSURANCE COMPANY LTD. versus SHALU SHARMA & ORS.

Citation: [2018] 1 S.C.R. 403 · Decided: 02-02-2018 · Supreme Court of India · Bench: DIPAK MISRA · Disposal: Disposed off

Judgment (excerpt)

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RELIANCE GENERAL INSURANCE COMPANY LTD.
v.
SHALU SHARMA & ORS.
(Civil Appeal No. 767 of 2018)
FEBRUARY 02, 2018
[DIPAK MISRA, CJI, A. M. KHANWILKAR AND
DR. D. Y. CHANDRACHUD, JJ.]
Motor Accidents Act, 1988 –  Compensation – Award of –
Death of self-employed (businessman) aged 42 years in a motor
accident – Award of future prospects to the extent of 30% – In appeal,
before the High Court, plea of the insurer-appellant that increase
in the gross total income of the deceased as shown in income tax
return would not justify award of future prospects – High Court
held that having due regard to the progressive increase in the income
of the deceased, the award of future prospects by the tribunal could
not be faulted – On appeal, held: Future prospects cannot be denied
in case the deceased was self-employed – Deceased being of 42
years of age at the time of the accident, an addition of 25% on the
ground of future prospects would be warranted instead of 30%
computed by the tribunal.
A self employed (businessman) aged 42 years died in an
accident caused due to the negligence of the driver of the
offending vehicle, insured by the appellant. The tribunal awarded
30 per cent towards the loss of future prospects in assessing
compensation and awarded compensation of Rs. 30,26,810/-. In
appeal, the insurer-appellant contended that the increase in the
gross total income of the deceased as shown in income tax return
would not justify award of future prospects. The High Court held
that having due regard to the progressive increase in the income
of the deceased, the award of future prospects by the tribunal
could not be faulted. Hence, the instant appeal.
Disposing of the appeal, the Court
HELD: 1. Since the deceased was 42 years of age, an
addition of 25% on the ground of future prospects would be
warranted instead of 30% computed by the tribunal. The tribunal
held that the annual income of the deceased (on the basis of the
[2018] 1 S.C.R. 403
403
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SUPREME COURT REPORTS
[2018] 1 S.C.R.
income tax returns for 2010-11, 2011-12 and 2012-13) would be
Rs 1,81,500. Adding a component of 25% for future prospects,
the income would stand at Rs 2,26,875. Deducting an amount of
one fourth towards personal expenses, the loss of dependency
per annum works out to Rs 1,70,156. Applying a multiplier of 14,
the total loss of dependency would work out to Rs 23,82,187.
The tribunal awarded a sum of Rs 3,14,335 towards medical
expenses. An addition of Rs 70,000 would be required to be made
in terms of the decision in *Pranay Sethi case on account of the
conventional heads of loss of estate (Rs 15,000), loss of
consortium (Rs 40,000) and funeral expenses (Rs 15,000). Hence,
the total compensation is quantified at Rs 27,66,522 on which
the claimants would be entitled to interest @ 9% p.a. from the
date of the filing of the claim petition. The apportionment shall
be carried out in terms of the award of the tribunal. [Paras 4-
5][405-G-H; 406-A-B]
*National Insurance Company Limited v. Pranay Sethi
(2017) 13 SCALE 12 - relied on.
Case Law Reference
(2017) 13 SCALE 12
relied on
Paras 4, 5
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 767 of
2018.
From the Judgment and Order dated 24.05.2016 of the High Court
of Delhi at New Delhi in MAC Appeal No. 343 of 2016.
Ms. Prerna Mehta, Adv. for the Appellant.
Syed Mehdi Imam, Bhopal Singh, Tabrez Ahmed, Javed Muzaffar,
D. K. Sharma, Advs. for the Respondents.
The Judgment of the Court was delivered by
DR. D. Y. CHANDRACHUD, J. 1. The present appeal arises
from the judgment of a Single Judge of the Delhi High Court in an appeal
against an award of the Motor Accident Claims Tribunal (MACT).
2.  Narinder Sharma died in an accident which occurred on 14
September 2013. The accident involved a motor vehicle which was insured
against third party risks by the appellant.  The dependents filed a claim
for compensation before the MACT.  The Tribunal held that the accident
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was caused due to the negligence of the driver of the offending vehicle.
Compensation of Rs 30,26,810 was awarded together with interest at 9
per cent per annum.  The Tribunal factored in a component of 30 per
cent towards the loss of future prospects in assessing the compensation.
3. The High Court has observed that the only issue which was
raised by the insurer was in regard to the award of future prospects to
the extent of 30 per cent.  The deceased was conducting his own business
in the name and sty

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