THE NEW INDIA ASSURANCE COMPANY LIMITED versus SMT. KALPANA & OTHERS

Citation: [2007] 1 S.C.R. 985 · Decided: 17-01-2007 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Case Partly allowed
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Judgment (excerpt)

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THE NEW INDIAASSURANCE COMPANY LIMITED 
v. 
SMT. KALPANA & OTHERS 
JANUARY 17, 2007 
[DR. ARIJIT PASAYAT AND S.H. KAPADIA, JJ.] 
Motor Vehicles Act, 1988: 
s.17 3-Motor accident-Death of injured-Petition claiming 
compensation-Multiplier to be applied-Interest-Held, there being no 
evidence showing income of deceased, monthly contribution to family after 
deduction for personal expenses fixed at Rs.3,000-Deceased being 33 
years of age multiplier of 13 applied-Compensation worked out 
accordingly- Interest to be paid @ 6% from date of claim till actual 
payment-Interest. 
The vehicle of husband of respondent no. 1 dashed about 9.50 P.M. 
with a truck which was parked on the road in violation of traffic rules; as 
a result he got injuries and died in the Hospital. The deceased was about 
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33 years of age. His dependents filed a petition claiming compensation 
under s.173 of the Motor Vehicles Act, 1988. The Motor Accident Claims 
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Tribunal dismissed the claim petition holding that accident took place due 
to negligence of the deceased. In appeal, the High Court held the insurer 
liable to pay compensation, and taking the monthly income of the deceased 
at Rs.4,000 and multiplier of 17, awarded an amount of Rs.8,16,000 as 
compensation with 6% interest from the date of filing of the claim till the 
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date of actual payment. 
In the appeal filed by the insurer it was contended that the High Court 
erred in applying the multiplier of 17. It was also submitted that there was 
no evidence to show the actual income of the deceased. 
Allowing the appeal in part, the Court 
HELD : 1.1. In a fatal accident action, the accepted measure of 
damages awarded to the dependants is the pecuniary loss suffered by them 
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as a result of the death. The multiplier method involves the ascertainment 
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985 
986 
SUPREME COURT REPORTS 
[2007] 1 S.C.R. 
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of the loss of dependency or the multiplicand having regard to the 
circumstances of the case and capitalizing the multiplicand by an appropriate 
multiplier. The choice of the multiplier is determined by the age of the 
deceased (or that of the claimants whichever is higher) and by the calculation 
as to what capital sum, if invested at a rate ofinterestappropriate to a stable 
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economy, would yield the multiplicand by way of annual interest. In 
ascertaining this, regard should also be had to the fact that ultimately the 
capital sum should also be consumed-up over the period for which the 
dependency is expected to last. [Paras 5 and 7] [988-F, 989-C-D] 
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Municipal Corporation of Delhi v. Subhagwanti, [1966] 3 SCR 649; 
and New India Assurance Co. Ltd v. Charlie and Another, [2005] 10 SCC 
720, relied on. 
G.M, Kera/a SRTC v. Susamma Thomas, .[1994] 2 SCC 176 and UP. 
State Road Transport Corpn. v. Trilok Chandra, [1996) 4 SCC 362, 
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referred to. 
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Davies, v. Powell Duffryn Associated Collieries Ltd, All ER p.665 A-
B; Nance v. British Columbia Electric Railway Co. Ltd., [1951] (2) All ER 
448; and Mallett v. Mc Mangle, [1969] 2 All ER 178, referred to. 
Halsbury's Laws of England, Vol. 34, para 98, referred to. 
1.2. In the instant case, considering the age of the deceased it would 
be appropriate to fix the multiplier at 13. The MACT itself found that the 
income was not established. At some point of time it was stated that the 
income of the deceased was Rs.6,000 per month. In the absence of any 
definite material about the income, monthly contribution to the family, after 
deduction for personal expenses, is fixed at Rs.3,000 per month i.e. 
annually Rs. 36,000. Applying the multiplier of 13, the compensation 
works out to Rs. 4,68,000. The same shall carry interest @ 6% p.a. from 
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the date of claim till the date of actual payment, separate fixed deposits shall 
be made for respondent no.1, respondents 2 and 3 represented by the 
mother (respondent no.1), and the respondent no.4 as specified in the 
judgment. [Paras 12 & 13) [992-B-F] 
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CIVIL APPELLATE JURISDICTION: Civil Appeal No. 255 of2007. 
THE NEW INDIA ASSURANCE CO. LTD. v. SMT. K.ALPANA [PASAYA""P, J.] 987 
From the final Judgment and Order dated 25.8.2004 of the High Court 
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of Uttaranchal at Nainital in A.O. No. 9512002. 
Joy Basu, Mike Desai, Lal it Mohini Bhat and Madhurendra Kumar for 
the Appellants. 
Chandra Prakash Pandey for the Respondent. 
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The Judgment of the Court was delivered by 
DR. ARIJIT PASAYAT, J.: Leave granted. 
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2. Challenge in this appeal is to t
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