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2025 (6) TMI 1004 - HC - Indian LawsMajor son and daughter who are not dependent on the income of deceased can claim compensation on the ground of loss of dependency or can file a petition for claiming compensation under Section 166 of the Motor Vehicles Act or not - HELD THAT - In the absence of evidence to the contrary the siblings of the deceased being independent and earning or married will not be considered as dependents of the deceased. The Hon ble Apex Court in case of New India Assurance Co. vs Anand Pal 2023 (12) TMI 1449 - SC ORDER held that the Tribunal and the High Court should not have considered the three older married siblings to be dependent on the deceased victim. The compensation awarded to the married siblings is therefore found to be unmerited. This Court in the aforesaid judgments relied upon by the appellant Insurance Company has also taken similar view. However a contrary view has been taken by the Hon ble Apex Court in the case of National Insurance Co. Ltd. Vs Birender 2020 (1) TMI 1730 - SUPREME COURT by observing It is thus settled by now that the legal representatives of the deceased have a right to apply for compensation. Having said that it must necessarily follow that even the major married and earning sons of the deceased being legal representatives have a right to apply for compensation and it would be the bounden duty of the Tribunal to consider the application irrespective of the fact whether the concerned legal representative was fully dependant on the deceased and not to limit the claim towards conventional heads only. It is extremely important to note that the Hon ble Apex Court in the case of New India Assurance vs Anand Pal did not make any reference to its earlier observation in the case of National Insurance Co. Ltd. Vs Birender. It has decided the issue involved in that appeal independently only by referring its earlier judgment in the case of Sarla Verma. However when the recent judgment of the Hon ble Court has reiterated the view taken in the case of National Insurance Co. Ltd. Vs Birender it has now been settled that even major married and earning children of the deceased in the capacity of legal representatives have right to apply for compensation even they are earning separately and not depending upon the income of deceased. Therefore on this aspect the appeal of the Insurance Company needs to be dismissed. It is now settled that even in absence of appeal by the claimants it is the duty of the Court to assess just and fair compensation. The learned Counsel for the respondent Nos.1 and 2/claimants pointed out that the learned tribunal while calculating the compensation amount on all heads did not consider the head under future prospects and therefore the compensation in the light of the observation of Hon ble Apex Court in the case of Seema Rani vs Oriental Insurance Co. Ltd. 2025 (2) TMI 1193 - SUPREME COURT needs to be recalculated in the light of the judgments of Hon ble Apex Court in the cases of National Insurance Co. Ltd. Vs Pranay Sethi 2017 (10) TMI 1276 - SUPREME COURT and Magma General Insurance Co. Ltd. Vs Nanu Ram 2018 (9) TMI 2160 - SUPREME COURT . Admittedly the learned tribunal has calculated the compensation amount under the guidelines issued by the Hon ble Apex Court in the case of Sarla Verma However those guidelines are subsequently modified in the cases of Pranay Sethi and Magma General Insurance by introducing new heads such as future prospects and types of consortium. The undisputed income by salary of the deceased Sharubala is Rs. 46, 623/- per month after deducting income tax and professional tax. The age of the deceased was admittedly 52 years and therefore considering the guidelines in the case of Pranay Sethi (supra) 15% of such income has to be added on the count of future prospects. On such addition the monthly income of the deceased comes to Rs. 53616.45. For the age of deceased the multiplicand of 11 is applicable. Therefore the amount of loss of dependency comes to Rs. 70, 77, 371.40. From the said amount one-third amount is to be deducted on the count of personal expenses of the deceased. Thus on such deduction the loss of dependency now comes to Rs. 47, 18, 247.60. In this amount the amount of Rs. 80, 000/- towards filial consortium i.e. Rs. 40, 000/- each for respondent Nos.1 and 2/claimants is to be added and further on account of loss of estate and funeral expenses an amount of Rs. 30, 000/- is also permissible. Therefore the final amount of compensation is now determined to Rs. 48, 28, 247.60 (47, 18, 247.60 80, 000 30, 000) inclusive of the award under no fault liability . Conclusion - The appellant Insurance Company and respondent No.4 being the insurer and owner of the offending truck shall jointly and severally pay compensation of Rs. 48, 28, 247.60 to the respondent Nos.1 and 2/claimants inclusive of the no fault liability amount along with interest at the rate of Rs. 8% per annum from the date of petition till its realization. It appears from the record that the appellant Insurance Company has already deposited certain amounts in this Court. The same shall be appropriated in the total amount of compensation granted by this Court. Appeal dismissed.
1. ISSUES PRESENTED and CONSIDERED
The core legal question considered by the Court was whether major sons and daughters of a deceased, who are not dependent on the income of the deceased, have the right to claim compensation for loss of dependency under Section 166 of the Motor Vehicles Act. Specifically, the Court examined if major married and earning children, as legal representatives of the deceased, can claim compensation irrespective of their dependency status. Additionally, the Court considered the proper method for calculating compensation, including whether future prospects should be factored into the loss of dependency calculation. 2. ISSUE-WISE DETAILED ANALYSIS Issue: Right of major sons and daughters, not dependent on deceased's income, to claim compensation The legal framework relevant to this issue includes Section 166 of the Motor Vehicles Act, which allows legal representatives of a deceased to claim compensation for loss of dependency. The Court examined several precedents, including the judgments in Sarla Verma & Ors. vs Delhi Transport Corporation, New India Assurance Co. Ltd. vs Anand Pal & Ors., National Insurance Co. Ltd. vs Birender & Ors., and Seema Rani & Ors. vs The Oriental Insurance Company Ltd. & Ors. The appellant Insurance Company relied heavily on the judgment in New India Assurance Co. Ltd. vs Anand Pal, which held that in the absence of evidence to the contrary, major siblings or children who are independent and earning or married will not be considered dependents of the deceased. This judgment emphasized that compensation should not be granted to those who do not rely on the deceased's income, particularly where the claimants reside separately and earn their own livelihood. However, the respondents countered this by citing the more recent and authoritative judgments in National Insurance Co. Ltd. vs Birender and Seema Rani vs Oriental Insurance Co. Ltd., where the Hon'ble Apex Court clarified that major married and earning children, as legal representatives, have the right to claim compensation irrespective of their dependency status. The Court highlighted that the Tribunal must consider such applications and is not limited to conventional heads of dependency. The Seema Rani judgment further emphasized that even a married daughter is entitled to compensation and that the quantum of compensation may be recalculated if certain heads were omitted by the Tribunal. The Court noted that the New India Assurance vs Anand Pal judgment did not refer to the earlier Birender judgment, which had already settled the law in favor of allowing claims by major earning children. The recent reiteration in Seema Rani confirmed this position, establishing that legal representatives who are major, married, and earning cannot be excluded from compensation claims merely on the basis of non-dependency. Applying these principles to the facts, the Court held that the major son and daughter prosecuting the claim, though earning separately and residing apart, were entitled to claim compensation as legal representatives of the deceased. The appellant Insurance Company's argument that the claimants were not dependent and hence not entitled to compensation was rejected. Issue: Proper calculation of compensation including future prospects The learned Tribunal had initially computed compensation based on the Sarla Verma guidelines, which did not explicitly include the heads of future prospects and types of consortium. The Court examined subsequent Apex Court judgments in National Insurance Co. Ltd. vs Pranay Sethi and Magma General Insurance Co. Ltd. vs Nanu Ram, which introduced the concept of adding future prospects to the income of the deceased, thereby increasing the quantum of compensation. The Court observed that the deceased's monthly income was Rs. 46,623 after tax deductions. Applying the 15% addition for future prospects as per Pranay Sethi, the monthly income was recalculated to Rs. 53,616.45. Using the multiplicand of 11 applicable for the deceased's age of 52 years, the loss of dependency was computed at Rs. 70,77,371.40. After deducting one-third for personal expenses, the net loss of dependency was Rs. 47,18,247.60. Additionally, the Court allowed Rs. 80,000 towards filial consortium (Rs. 40,000 each for the son and daughter) and Rs. 30,000 for loss of estate and funeral expenses, bringing the total compensation to Rs. 48,28,247.60 inclusive of the no-fault liability award under Section 140 of the Motor Vehicles Act. The Court emphasized the duty of the Tribunal and Courts to assess just and fair compensation, even in the absence of an appeal by claimants, and to incorporate all relevant heads such as future prospects and consortium to ensure adequacy of compensation. 3. SIGNIFICANT HOLDINGS The Court held: "It is thus settled by now that the legal representatives of the deceased have a right to apply for compensation. Having said that, it must necessarily follow that even the major married and earning sons of the deceased being legal representatives have a right to apply for compensation and it would be the bounden duty of the Tribunal to consider the application irrespective of the fact whether the concerned legal representative was fully dependant on the deceased and not to limit the claim towards conventional heads only." Further, the Court quoted from the Seema Rani judgment: "We are unable to agree with the view taken by the Tribunal on the dependents of the deceased. This Court in National Insurance Company Limited v. Birender & Ors. had expounded that major married and earning sons of the deceased, being legal representatives, have a right to apply for compensation, and the Tribunal must consider the application, irrespective of whether the representatives are fully dependent on the deceased or not...there is no reason to exclude a married daughter from compensation." The Court also clarified the application of the Sarla Verma guidelines in light of subsequent rulings, stating: "Those guidelines are subsequently modified in the cases of Pranay Sethi and Magma General Insurance by introducing new heads, such as, future prospects and types of consortium." Accordingly, the Court concluded that the appeal of the Insurance Company challenging the entitlement of major earning children to claim compensation was dismissed, and the compensation amount was recalculated incorporating future prospects and consortium. The final determination ordered the appellant Insurance Company and the owner-insurer of the offending vehicle to jointly and severally pay Rs. 48,28,247.60 with interest at 8% per annum from the date of petition till realization, with the amount to be equally distributed between the son and daughter claimants.
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