IMPORTANT POINT
Death in motor accident – While computing compensation, essmoluments and benefits accruing to deceased under various heads for the purposes of computation of loss of income, ought to be included irrespective of whether they are taxable or not.

JUDGMENT :

MANOJ MISRA, J.

1. Leave granted.

2. This appeal arises out of judgment and order of the High Court of Judicature at Patna¹[High Court] dated 04.07.2022 passed in Miscellaneous Appeal No. 804 of 2017, whereby the compensation awarded by the XIth Additional District and Sessions Judge – cum - Motor Accident Claims Tribunal, Muzaffarpur²[Tribunal] in Claim Case No. 196 of 2011 was reduced from Rs. 88,20,454 to Rs. 38,15,499.

3. As liability to pay compensation is not in issue, the question that arises for our consideration is whether the High Court was justified in reducing the compensation payable to the appellant.

4. The operative part of the award passed by the Tribunal including computation of compensation is found in paragraphs 10 to 12 of the award, which are reproduced below:

“10. Multiplier: So far quantum of compensation is concerned, the proper multiplier will be 18 as per Schedule-II of the M.V. Act, as the age of deceased was 27 years as per evidence on record.

As per Ext. A & A/1 submitted by O.P. No. 2 Insurer (Insurance Company) and also Ext. 1 salary slip submitted by Claimant the salary of the deceased for the month of Feb., 2011 was as under:

Basic Pay – Rs. 26,420/-

D.A.: 43% - Rs. 11,360/-

Local Allowance:

10% - Rs. 2,642/-

Other allowances:

49% i.e. Rs. 12,945.80

Thus, total salary of deceased comes to Rs. 53,367 per month. Therefore, loss of dependency would come to Rs. 53,367 x 12 x 18 = Rs. 1,15,27,272/-

Out of which ½ his personal expenses would be deducted and then loss of dependency would be Rs. 57,63,636/-. In which 50% future prospects would be added i.e. amount Rs. 28,81,818/- then loss of dependency would be Rs. 86,45,454/-.

11. In addition, the claimants are entitled to get a sum of Rs. 1,00,000/- under the head of loss of estate, Rs. 1,00,000/- towards loss of love and affection and Rs. 15,000/- as funeral expenses.

Thus, total compensation will be Rs. 88,70,454/- Hence, claimants are entitled to get Rs. 88,70,454/- with interest thereon at the rate of 6% per annum.

12. Perusal of case record it is evident that claimants have already received Rs. 50,000/- as ad-interim compensation U/s. 140 M.V. Act. Hence, this amount would be adjusted from the amount of Rs. 88,70,454/-. Then it comes to Rs. 88,20,454/- as total compensation U/s. 166 M.V. Act. Hence claimants are entitled to get the said amount with interest thereon @ 6% per annum. Therefore, it is,

ORDERED

That the O.P. No. 2 Oriental Insurance Company Limited, Muzaffarpur is directed to pay the total compensation amount of Rs. 88,20,454/- to the claimants within two months with interest thereon @ 6% per annum from the date of filing till the date of realization failing which the law will take its own course.”

5. On an appeal preferred by the Insurance Company (the respondent herein), the High Court computed the compensation in the following manner:

“In view of the above, the computation of the claim of the appellant would be as follows:

The aforesaid total amount of Rs. 38,15,499/- shall be paid by the Insurance Company to the respondent/claimants within a period of three months with interest thereon at the rate of 6% per annum from the date of petition till the date of realization.”

6. The