UNITED INDIA INSURANCE CO. LTD. versus BINDU AND ORS.

Citation: [2009] 1 S.C.R. 872 · Decided: 05-02-2009 · Supreme Court of India · Bench: ARIJIT PASAYAT · Disposal: Case Partly allowed
Open in Lexace · Ask the AI about this case
Judgment (excerpt)

A 
B 
c 
D 
[2009) 1 S.C. R. 872 
UNITED INDIA INSURANCE CO. LTD. 
v. 
BINDU AND ORS. 
(Civil Appeal No. 724 of 2009) 
FEBRUARY 5, 2009 
[DR. ARIJIT PASAYAT AND ASOK KUMAR 
GANGUL Y, JJ.] 
Motor Vehicles Act, 1988: 
Fatal accident - Deceased aged 32 years and earning 
Rs. 7,4271- per month - Tribunal adopting multiplier of 17 
awarding compensation of Rs.10,61,0001- with 9% interest-
Held: Appropriate multiplier would be 13 and rate of interest 
6% - Tribunal to workout the entitlement accordingly. 
In a claim petition field uls.166 of the Motor Vehicles 
Act, 1988 filed by the dependents of the victim of a fatal 
accident, who was aged 32 years and earning Rs.7,7241 
- per month, the MACT applied the multiplier of 17 and 
awarded a compensation of Rs.10,61,0001- with 9 % 
E interest from the date of filing of the claim petition. The 
High Court affirmed the award. 
In the instant appeal field by the Insurance Company, 
it was contended for the appellant that the multiplier 
F adopted by the Tribunal had no basis and the rate of 
interest awarded was also high. 
Allowing the appeal in part, the Court 
HELD:1.1. The multiplier method involves 
G ascertainment 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 
H 
872 
+-
UNITED INDIA INSURANCE CO. LTD. v. BINDU AND 
873 
ORS. 
whichever is higher) and by the calculation as to what 
capital sum, if invested at a rate of interest appropriate 
to a stable 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. [Para 6) [876-C-E] 
Mallett v. Mc Mangle (1969) 2 All ER 178; Davies v. 
Powell Duffregn Associated Collieries Ltd. 1942 AC 601 and 
Nance v. British Columbia Electric Railway Co. Ltd. (1951) 2 
All ER 448, referred to. 
1.2. Keeping in view the parameters laid down in the 
decided case, it would be appropriate to fix the multiplier 
at 13 and the rate of interest at 6% p.a. The MACT shall 
work out the entitlements accordingly. [Para 12) [878-F] 
General Manager, Kera/a State Road Transport 
Corporation, Trivandrum v. Susamma Thomas (Mrs.) and 
Ors. (1994) 2 SCC 176 and UP. State Road Transport 
Corporation And Others v. Trilok Chandra and Ors. (1996) 4 
sec 362, relied on. 
Case Law Reference: 
1942 AC 601 
referred to 
para 5 
(1951) 2 All ER 448 
referred to 
para 5 
(1969) 2 All ER 178 
referred to 
para 7 
(1994) 2 sec 116 
relied on 
para 10 
(1996) 4 sec 362 
relied on 
para 10 
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 724 
of 2009. 
From the Order dated 1.12.2006 of the High Court of 
Kerala at Ernakulam in MFA No. 313 of 2002. 
M.K. Dua, Kishore Rawat and Dhiraj for the Appellant. 
A 
B 
c 
D 
E 
F 
G 
H 
A 
874 
SUPREME COURT REPORTS 
(2009) 1 S.C.R. 
The Judgment of the Court was delivered by 
DR. ARIJIT PASAYAT, J. 1. Leave granted. 
2. Challenge in this appeal is to the judgment of a Division 
Bench of the Kera la High Court dismissing the appeal filed by 
B the appellant questioning correctness of the award passed by 
the Motor Accident Claims Tribunal, Paravur (in short the 
'MACT'). 
3. Background facts in a nutshell are as follows: 
C 
One Anil lost his life in a vehicular accident on 17.6.1999. 
The respondents filed a Claim Petition in terms of Section 166 
of the Motor Vehicles Act, 1988 (in short the 'Act'). It was stated 
in the claim petition that when the deceased was driving a 
motor cycle, a tractor owned by respondent no.5 which was 
being driven in rash and negligent manner by respondent No.4 
D dashed against him and he suffered serious injuries. The 
vehicle was the subject matter of insurance with the present 
appellant (hereinafter referred to as the 'insurer'). A claim of 
Rs.12,00,000/- was made. The stand taken by the insurer was 
that the accident took place only due to the negligence of the 
E deceased and there was no negligence on the part of the driver. 
It was also submitted that there was no evidence regarding the 
income of the deceased and, therefore, the claim was highly 
exaggerated. It was indicated in the claim petition that the age 
of the deceased was 32 years and that he was getting 
F Rs.7,427/- as monthly salary
Excerpt shown. Read the full judgment & AI analysis in Lexace.