No restriction on Courts to award compensation exceeding claimed amount under Motor Vehicles Act – SC

No restriction on Courts to award compensation exceeding claimed amount. The compensation under Motor Vehicles Act, 1988 has to be just – Supreme Court

ABCAUS Case Law Citation:
ABCAUS 2656 (2018) (11) SC

Important Case Laws Cited/relied upon:
Nagappa v. Gurudayal Singh  (2003) 2 SCC 274
Magma General Insurance v. Nanu Ram  (2018) SCC Online SC 1546
Ibrahim v. Raju (2011) 10 SCC 634

The claimants in the instant appeal had sought further enhancement of compensation awarded by the High Court. The High Court, by the impugned judgment had already enhanced the compensation

In the accident, the deceased who had been working at Doha  succumbed  to death due to grievous injuries. His wife, two children aged about 3 years and 9 months and aged father (about 90 years of age) moved a claim petition before the Motor Accidents Claim Tribunal seeking a total compensation of Rs. 25,00,000/­. The Tribunal, assessed the monthly income of the deceased and deducted half amount towards  personal expenses. The compensation awarded was Rs. 11,83,000/­with interest at the rate of 7.5% per annum from the date of filing the claim petition till its realization.

The respondent–Insurance Company filed an appeal before the High Court against the award of  the  Tribunal, whereas the claimants filed cross objections seeking enhancement in compensation. The High Court took into consideration the salary certificate of the deceased which was attested/counter signed by the Embassy of India. The High Court enhanced the compensation by awarding an additional compensation.

The Hon’ble Supreme Court opined that the overall compensation awarded by the High Court was just and reasonable in respect of all the heads except under the head of loss of dependency where the the High Court faulted in deducting 2/3rd of the total income towards the personal expenses of the deceased, while quantifying the compensation.

The Hon’ble Supreme Court opined that in the facts and circumstances of the case, a deduction of 40% of the salary for the personal expenses would  be  appropriate  for  the purpose of quantifying   compensation.

The Hon’ble Supreme Court opined that taking into consideration the factor of  uncertainties in the job in Doha as well as uncertainty in staying back in the said country for a longer period  and in the absence of any material to show as to for how many  years  the  deceased was having contract to serve, the claimants were entitled to a total compensation  of Rs. 28,00,000/ inclusive of the compensation awarded by the High Court, with interest at the rate of 8% per annum.

The Hon’ble Supreme Court observed that though the claimants had claimed a total compensation of Rs. 25,00,000/ ­in their claim petition filed before the Tribunal, the claimants were entitled to higher compensation.

The Hon’ble Supreme Court held that there is no restriction that the  Court  cannot  award compensation exceeding the claimed amount, since the function of the Tribunal or Court under Section 168 of the  Motor  Vehicles  Act,  1988 is  to award “just compensation”.

The Hon’ble Supreme Court opined that the Motor Vehicles Act is a beneficial and welfare legislation. A “just compensation” is one which is reasonable on the basis of evidence produced on record. It cannot be said to have become time­ barred.  Further, there is no need for a new cause of action to claim an enhanced amount. The Courts  are duty bound to award just compensation.

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