Gauhati HC Enhances Motor Accident Award to Rs 8.81 Lakh After Tribunal Ignored Future Prospects and Parental Consortium

Justice Kaushik Goswami corrected a 2016 tribunal award that omitted future prospects and failed to grant parental consortium to two sons of the deceased under Pranay Sethi principles.

The Gauhati High Court has enhanced compensation in a road accident death claim from Rs 5,89,000 to Rs 8,81,500, after finding that the Motor Accidents Claims Tribunal had neither awarded any amount towards future prospects nor granted parental consortium to the two surviving sons of the deceased. Justice Kaushik Goswami, sitting singly, allowed the appeal under Section 173 of the Motor Vehicles Act, 1988 and directed the insurer, IFFCO TOKIO General Insurance Co. Ltd., to deposit the balance enhanced amount within six weeks. The judgment applies the Constitution Bench ruling in National Insurance Company Limited v. Pranay Sethi & Ors., (2017) 16 SCC 680, and the Supreme Court's subsequent elaboration on consortium heads in Magma General Insurance Co. Ltd. v. Nanu Ram alias Chuhru Ram & Ors., 2018 0 Supreme (SC) 892.

The Claim Before the Tribunal

The appellants are Smt. Putul Deka, widow of the deceased Lt. Bani Deka, and her two sons, Sri Raju Deka and Sri Kaju Deka, all residents of village Borka, District Kamrup, Assam. They filed a petition under Section 166 of the Motor Vehicles Act before the Additional District Judge (FTC) No. 3, Kamrup (M), Guwahati in MAC Case No. 132/2013, seeking compensation for the death of Bani Deka in a road traffic accident.

The Tribunal, by its Judgment and Award dated 22 June 2016, assessed compensation under four heads: loss of dependency at Rs 5,04,000 (taking a monthly income of Rs 4,500 and applying a multiplier of 14), funeral expenses at Rs 25,000, loss of consortium at Rs 50,000, and loss of estate at Rs 10,000, arriving at a total of Rs 5,89,000 with interest at 6% per annum. The claimants appealed, seeking enhancement to Rs 9,78,000.

Three Errors Identified in the Award

Counsel for the appellants, Mr. K. Bhattacharjee, identified three errors in the Tribunal's computation.

The first was the complete omission of any addition towards future prospects. The second was that, while the Tribunal awarded Rs 50,000 towards consortium, it gave this only as spousal consortium to the widow and entirely omitted parental consortium for the two sons. The third was the Tribunal's use of a monthly income figure of Rs 4,500, even though evidence on record established the deceased's monthly earnings as a Power Tiller Operator at Rs 5,000.

Counsel for respondent No. 3, the insurer, Mr. R. Goswami, conceded that the Tribunal had erred in not awarding future prospects and in not computing consortium in accordance with Pranay Sethi.

Applying Pranay Sethi: Future Prospects at 25%

Justice Goswami extracted the relevant conclusions from Pranay Sethi, which prescribe different addition rates depending on the age and employment status of the deceased. Where the deceased was self-employed and below 40 years, a 40% addition is warranted; between 40 and 50 years, 25%; between 50 and 60 years, 10%.

The deceased, a self-employed Power Tiller Operator, was aged 44 years at the time of the accident. Accordingly, the Court applied the 25% addition. Taking monthly income at Rs 5,000 — consistent with the evidence on record rather than the Tribunal's figure of Rs 4,500 — the monthly income after addition came to Rs 6,250. This yielded an annual income of Rs 75,000. After deducting one-third towards the deceased's personal and living expenses, the annual contribution to the family was Rs 50,000. Applying a multiplier of 14 as per the table in Sarla Verma (Smt) and Ors. v. Delhi Transport Corporation and Anr., (2009) 6 SCC 121, the loss of dependency was recalculated at Rs 7,00,000, up from the Tribunal's figure of Rs 5,04,000.

Parental Consortium: A Head the Tribunal Missed Entirely

The more structurally significant correction concerned consortium. The Tribunal had awarded Rs 50,000 only towards spousal consortium for the widow. It made no award for the two sons.

Justice Goswami referred to the Supreme Court's ruling in Magma General Insurance, which explained that “consortium is a compendious term which encompasses spousal consortium, parental consortium, and filial consortium.” That judgment clarified that parental consortium is awarded to children who lose a parent in a motor vehicle accident, and that the quantum is governed by the principles in Pranay Sethi.

Since no parental consortium had been awarded to the two sons, the High Court held that the Tribunal's award required modification on this count as well. The widow and each of the two sons were each held entitled to Rs 48,400 towards their respective consortium heads. This figure represents the base amount of Rs 40,000 prescribed in Pranay Sethi, enhanced periodically at 10% every three years as that judgment requires.

The conventional heads were similarly enhanced by the same periodic enhancement principle. Funeral expenses were awarded at Rs 18,150 and loss of estate at Rs 18,150, both enhanced from the base figures of Rs 15,000 in Pranay Sethi.

Revised Computation

The revised award, as determined by the High Court, is as follows:

• Loss of dependency: Rs 7,00,000
• Loss of spousal consortium (widow): Rs 48,400
• Loss of parental consortium (two sons at Rs 48,400 each): Rs 96,800
• Funeral expenses: Rs 18,150
• Loss of estate: Rs 18,150
• Total: Rs 8,81,500

The interest rate and the date from which interest runs remain as originally awarded by the Tribunal.

Order

Justice Goswami modified the Judgment and Award dated 22 June 2016 of the Additional District Judge (FTC) No. 3, Kamrup (M), Guwahati to the extent set out above. The appeal was disposed of accordingly.

Respondent No. 3, IFFCO TOKIO General Insurance Co. Ltd., was directed to pay the balance enhanced compensation — the original amount having already been deposited and received by the claimants — within six weeks of the date of the judgment. The Trial Court Record was directed to be sent back.