IMPORTANT POINTS
(1) Compensation must be fair, reasonable and equitable – Determination of quantum is a fact-dependent exercise which must be liberal and not parsimonious.
(2) Documents such as income tax returns and audit reports are reliable evidence to determine income of deceased – Determination of income of deceased on a notional basis as per his educational qualification is erroneous.

JUDGMENT :

SURYA KANT, J.

1. Leave Granted.

2. The present appeal is directed against the judgment dated 30.06.2017 passed by the High Court of Judicature at Madras, Madurai Bench whereby the appeal preferred by the National Insurance Co. Ltd. (Respondent No. 1; hereinafter “Insurance Company”) against the award dated 06.10.2012 passed by Motor Vehicle Accident Claims Tribunal, Tiruchirappalli (hereinafter “Tribunal”) was allowed and the compensation granted to Appellants was reduced from Rs. 4,29,37,700/- to Rs. 57,90,000/- along with requisite interest. The factual matrix is succinctly discussed below before delving into the issue of law regarding determination of quantum of compensation which requires adjudication before us.

(A) FACTS

3. S. Kumareshan (hereinafter “Deceased”) was a resident of Tiruchirappalli, Tamil Nadu. On the fateful day, at about 4 PM in the evening, he was travelling alone in a Lancer Car bearing Registration No. TN-45-S-9199 and met with an unfortunate accident with an Ambassador Car bearing Registration No. TN 59 E 9288 along the stretch of road between Sethathupatti and Soriampattti. The collision was so powerful that the drivers of both vehicles passed away before any medical assistance could reach them. The sole survivors of the collision were occupants of the Ambassador Car, who miraculously escaped death but were saddled with multiple injuries.

4. The Deceased was aged above 31 years at the time of death and was an income tax assessee. He was a businessman who held diverse interests in arenas such as jewellery, textiles, exports and transport. Furthermore, he also drew income from his agricultural lands and leased out real estate. At the time of his demise, he left behind a widow, two minor children and parents who were stated to be dependent on him. It is to be noted that among these dependents, the father of the Deceased passed away during the proceedings before the High Court.

5. The Deceased’s dependents filed a claim petition for Rs. 7,00,00,000/- in August 2004, alleging, inter-alia, that he died as a result of the injuries suffered in the abovementioned accident of 10.06.2004, which occurred due to the rash and negligent driving of the Ambassador Car which the Insurance Company had insured. Before the Tribunal, the Insurance Company took the stance that the Deceased was the one who was responsible for the accident and that the compensation sought by the Deceased was exorbitant. It is worth noting that the injured occupants of the Ambassador Car who survived the crash also filed their respective claim petitions.

6. In reaching its verdict, the Tribunal relied upon the statements of the abovementioned injured occupants to conclude that it was the driver of the Ambassador Car who was solely responsible for the crash and therefore assigned liability for the accident to him, which ultimately was to be borne by the Insurance Company. As a result, the claim petition of the Deceased’s dependents was allowed partly, and compensation of Rs. 4,29,37,700/- was granted along with interest at the rate of 7.5% per annum. The Tribunal relied on the Deceased’s income tax returns and other financial documents, which were supported by the testimonies of the chartered accountant, auditor, and wife of the deceased (Appellant No. 1).

7. The aggrieved Insurance Company filed its appeal which was decided through the impugned judgment dated 30.06.2017. The High Court although being in total agreement with the Tribunal’s reasoning in finding that the Ambassador Car driver was solely liable for the accident, disagreed with the approach of the Tribunal in respect to the computation of compensation, primarily under the head of loss of income. It emphasized that the Deceased before his death had transferred his interest in some of the partnership firms in favour of his minor children. Furthermore, it highlighted that alm