Manusha Sreekumar & Ors. VERSUS The United India Insurance Co. Ltd.

Manusha Sreekumar & Ors.  VERSUS The United India Insurance Co. Ltd. 

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

  REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 7593 OF 2022

[Arising out of Special Leave Petition (C) No. 28833 OF 2019]

Manusha Sreekumar & Ors.                                    …. Appellants

VERSUS

The United India Insurance Co. Ltd.                      .... Respondent

JUDGMENT

Surya Kant, J.

1. Leave granted.

2. The   present   appeal   arises   out   of   the   judgment   dated

23.07.2019 passed by the High Court of Kerala, in an appeal

preferred by the Respondent (hereinafter, “Insurance Company”)

against   the   award   dated   26.07.2018   of   the   Motor   Vehicle

Accidents   Claims   Tribunal,   Pala   (hereinafter,   “Tribunal”).   The

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High   Court   allowed   the   appeal   and   has   reduced   the

compensation   amount   of   Rs.   32,39,000/­   granted   to   the

Appellants by the Tribunal to Rs. 19,70,000/­. The issue involved

in the instant matter primarily relates to the determination of

quantum of compensation awarded under various heads by the

Tribunal and the High Court. 

A.     FACTUAL BACKGROUND:

3. On 21.02.2015, the dreams and aspirations of the 32­yearold Deceased (Sreekumar) shattered when he met with a fatal

accident that occurred while he was riding his motorcycle bearing

Registration   No.   KL­36­C­9198   through   Thalayolaparambu   to

Ernakulam   Road,   Kerala.   At   the   time   of   the   accident,   the

offending   car   bearing   Registration   No.   KL­07­BB­5053   was

insured   by   the   Respondent   Insurance   Company   and   was

allegedly driven in a rash and negligent manner. The car came

from   the   opposite   direction   and   dashed   into   the   motorcycle

driven by the Deceased. As a result of the impact, Sreekumar fell

and sustained serious injuries. Though concerted efforts were

made to save the Deceased’s life, unfortunately, he succumbed to

his injuries on the way to the hospital. 

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4. Swaddled   in   the   grief   of   the   untimely   death   of   their

breadwinner,   Appellants   approached   the   Tribunal   seeking

compensation   for   their   loss.   It   may   be   noted   that   the   first

Appellant is the wife of the Deceased, the second Appellant is

their minor son, and the third Appellant is the mother of the

Deceased.   Appellants   jointly   preferred   a   claim   petition   under

section 166 of the Motor Vehicles Act, 1988 (hereinafter, “the

Act”) seeking compensation of Rs. 64,15,000/­ with interest. The

Insurance   Company   confuted   the   claim   contending   that   the

accident occurred due to negligence of the Deceased. The amount

of compensation claimed under various heads was also alleged to

be excessive. 

5. The Appellants stood their ground by stating that they were

entitled to compensation for ‘loss of dependency’ as the Deceased

was a self­employed man who donned multiple hats so as to

provide   a   comfortable   living   for   his   family.   According   to   the

Appellants, the Deceased was a fish vendor­cum­driver and was

earning at least Rs. 25,000/­ per month. Appellants produced

various documentary pieces of evidence before the Tribunal to

prove the Deceased’s financial capacity while he was alive. These

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were ­  (i)  a course certificate showing that the Deceased had

completed two years course in electronic mechanic trade;  (ii)  a

job   training   certificate   at   Sun   Generic   Cables   Pvt.   Ltd.;  (iii)

Passport of the Deceased indicating that he was employed in the

Sultanate of Oman between 18.11.2007 and 17.11.2011;  (iv)  a

certificate to show that the Deceased received rent from a shop in

the Municipal market shopping complex;  (v)  a job offer letter

dated 11.12.2014 from the United Kingdom, offering the position

of a Telecom Rigger;  (vi)  bank statements of the Deceased and

(vii) certificate of Kerala Motor Transport Workers Welfare Fund

Board. 

6. Taking into consideration the aforementioned documentary

evidence   concerning   the   Deceased’s   income,   the   Tribunal

concluded that he was a skilled labourer. It was also observed

that the Deceased was earning from the rent he received from the

room leased out to conduct fish vending business. The Tribunal

opined that the Deceased was a driver and accordingly fixed his

monthly income at Rs.14,000/­. Additionally, assuming that the

Deceased   received   at   least   Rs.3,500/­   as   rent,   the   Tribunal

calculated his final notional income as Rs.17,500/­ (Rs. 14,000 +

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Rs. 3,500). The Tribunal fixed the total compensation of loss of

dependency along with various other heads at Rs. 32,39,000/­

and awarded interest at the rate of 9% per annum from the date

of filing of petition till the realisation of awarded compensation. 

7. The Insurance Company filed an appeal before the High

Court challenging the quantum of compensation granted by the

Tribunal. Though the High Court concurred with the Tribunal in

finding that the Deceased died in an accident caused due to rash

and   negligent   driving   of   the   car   which   was   insured   by   the

Insurance Company, it disagreed with the Tribunal primarily on

three counts.  Firstly,  compensation granted under the head of

‘loss of dependency’; secondly, compensation under the head of

‘pain and suffering’ and finally, compensation under the head of

‘loss   of   love   and   affection’.   For   ease   of   reference,   the   table

supplied   below   elucidates   the   compensation   granted   by   the

courts below under various heads:­ 

SL.

No.

Head of claim  Amount

awarded  by  the

High Court

Amount

awarded   by   the

Tribunal  

1. Loss of dependency  Rs. 17,92,000/­ Rs. 31,36,000/­

2. Pain and sufferings  Rs. 15,000/­ Rs. 30,000/­

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3. Loss   of   consortium

to the first Appellant

Rs. 40,000/­ Rs. 40,000/­

4. Loss   of   love   and

affection   to   the

second Appellant 

Rs. 50,000/­ Not allowed 

5. Loss   of   love   and

affection to the third

Appellant

Rs. 40,000/­ Not allowed 

6. Transport to hospital Rs. 3,000/­ Rs. 3,000/­

7. Funeral expenses Rs. 15,000/­ Rs. 15,000/­

8. Loss of estate  Rs. 15,000/­ Rs. 15,000/­

Total Compensation Rs. 19,70,000/­ Rs. 32,39,000/­

8. In relation to the first count, the High Court was swift in

concluding that in the absence of any evidence to establish the

income of the Deceased, the Tribunal had erroneously fixed his

notional  income  at  Rs.  14,000/­ per month.  The  High  Court

viewed that in the decisions of Ramachandrappa v. Manager,

Royal   Sundaram   Alliance   Insurance   Company   Ltd.1

  and

Syed   Sadiq   and   Ors.   v.   Divisional   Manager,   United   India

Insurance Co. Ltd.

2

, this Court, in situations where the monthly

income of persons could not be established using independent

1

(2011) 13 SCC 236. 

2

(2014) 2 SCC 735. 

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evidence, fixed it at Rs.4,500/­ and Rs. 6,500/­ for accidents that

took place in the years 2004 and 2008, respectively. On that

premises, the High Court posited that since the accident took

place in 2015, the maximum monthly income that could have

been   reckoned   is   Rs.   10,000/­.   The   compensation   under   the

head   of   ‘loss   of   dependency’   was   thus   reduced   to   Rs.

17,92,000/­. 

9. Regarding the second count, the High Court scaled down

the compensation granted by the Tribunal under the head of

‘pain   and   suffering’   from   Rs.   30,000/­   to   Rs.   15,000/­.   The

reasoning employed by the High Court for this was that except in

cases wherein the death was not instantaneous, the conventional

amount to be granted would be Rs. 15,000/­. 

10. In relation to the third count, the High Court granted Rs.

50,000/­ and Rs. 40,000/­ under the head of ‘loss of love and

affection’ to the second and third Appellants respectively, which

was denied by the Tribunal. 

11. Consequently,   the   High   Court   substantially   reduced   the

compensation granted by the Tribunal from Rs. 32,39,000/­ to

Rs. 19,70,000/­. The aggrieved Appellants are now before this

Court. 

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B.     CONTENTIONS: 

12. We   have   heard   learned   counsel   for   the   parties   at   a

considerable length and meticulously perused the documents on

record.   The   liability   of   the   Insurance   Company   to   pay   the

compensation is not in dispute here. Nor there is any discordant

concerning the compensation awarded under various heads save

and   except   for   ‘loss   of   dependency’   and/or   under   the   nonconventional heads.

13. Mr.   Thomas   P.   Joseph,   learned   senior   counsel   for   the

Appellants   vehemently   argued   that   the   High   Court   erred   in

placing reliance on the decisions of this Court to assess the ‘loss

of dependency’ based on notional income as, in all those cases,

not even a single piece of evidence was led regarding the income

of   the   victim.   However,   in   the   instant   case,   the   Appellants

produced sufficient documentary evidence to prove the income of

the Deceased. Moreover, it is trite that the power of the Appellate

Court to undertake a fact­finding exercise and interfere with the

reasoning of the Tribunal is limited. The same is done only when

the findings are perverse or there is a material omission on the

part of the Tribunal. He also brought to our notice, Schedule B of

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the Kerala Motor Transport Workers’ Payment of Fair Wages Act,

1971   (hereinafter,   “Kerala   Fair   Wages   Act”)   as   per   which   a

‘driver’   is   classified   as   a   ‘Skilled   worker’   under   Category   IIISkilled­B. This Act was supplemented with the notification G.O.

(Ms.)   No.   123/2015/LBR   dated   04.09.2015   issued   by   the

Government of Kerala (hereinafter,  “Notification”) wherein, the

pay   scale   for   the   year   2015   for   each   category   of   workers   in

Schedule   B   of   the   Act   has   been   stipulated.   Learned   Senior

Counsel for the Appellant contended that the Deceased being a

registered transport motor driver, was entitled to be considered

as a ‘driver’ as defined under the Kerala Fair Wages Act and his

income was to be fixed in terms of the Notification, referred to

above. 

14. Per   contra,   learned   counsel   for   the   Insurance   company

urged   that   the   High   Court   was   right   in   reducing   the

compensation amount in the absence of any definite proof of

income   and   such   a   finding   of   fact   does   not   call   for   any

interference.   He   further   argued  that  the   High   Court   erred   in

granting compensation of Rs.90,000/­ under the head of ‘loss of

love  and affection’  as this  Court in  National   Insurance   Co.

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Ltd. v. Pranay Sethi and Ors.3

, has not granted any sum under

such like ‘non­conventional head’. Learned counsel relied on the

decision   of   this   Court   in  Cholamandalam   M/s   General

Insurance   Company   Ltd.   V.   Aarifa   &   Ors.4

  and  The New

India   Assurance   Co.   Ltd.   V.   Somwati  &   Ors.5

, wherein no

amount under the head of ‘loss of love and affection’ has been

held payable.

C.     ANALYSIS

15. From   the   aforesaid   discussion,   two   issues   arise   for

consideration of this Court:

(i) Whether   the   High   Court   was   right   in   reducing   the

monthly   income   of   the   Deceased   from   Rs.   17,500/­   to

Rs.10,000/­, for want of sufficient documentary evidence?

(ii) Whether   the   High   Court   was   right   in   awarding

compensation under the ‘non­conventional heads’ which is

impermissible as per Pranay Sethi? 

C.1  Determination of Compensation for loss of dependency.

3

(2017) 16 SCC 680.

4 Civil Appeal No. 6020/2019 vide order dt. 01.08.2019.

5 SLP(Civil) Diary No. 30766/2019 vide order dt. 24.09.2019. 

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16. While determining compensation under the Act, section 168

of   the   Act   makes   it   imperative   to   grant   compensation   that

appears to be just. The Act being a social welfare legislation

operates   through   economic   conception   in   the   form   of

compensation,   which   renders   way   to   corrective   justice.6

Compensation acts as a fulcrum to bring equality between the

wrongdoer and the victim, whenever the equality gets disturbed

by the wrongdoer’s harm to the victim. It also endeavors to make

good the human suffering to the extent possible and to also save

families which have lost their breadwinners from being pushed to

vagrancy. Adequate compensation is considered to be fair and

equitable   compensation.   Courts   shoulder   the   responsibility   of

deciding   adequate   compensation   on   a   case­to­case   basis.

However,   it   is   imperative   for   the   courts   to   grant   such

compensation which has nexus to the actual loss. 

17. This Court, in the case of Sarla Verma and Ors. v. DTC

and  Ors.7

,  laid down an objective formula for calculating just

compensation. According to the dictum, the three factors that

6 See Gregory C. Keating, ‘Distributive and Corrective Justice in the Tort Law of Accidents’ 

(2000) 74 S Cal L Rev 193.

7

(2009) 6 SCC 121. 

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need to be established are: (a) age of the deceased; (b) income of

the deceased; and (c) the number of dependents.

18. Further,   the   issues   that   are   to   be   determined   by   the

Tribunal   to   arrive   at   the   loss   of   dependency   are:   “(i)

additions/deductions to be made for arriving at the income; (ii)

the deduction to be made towards the personal living expenses of

the deceased; and (iii) the multiplier to be applied with reference

to the age of the deceased.” The purpose of standardising these

determinants was to bring uniformity to the decisions and settle

claims without delay. 

19. Applying the above parameters to the instant case, there

exists   sufficient   evidence   to   show   that  the   Deceased,

undoubtedly, was a fish vendor­cum­driver with a valid license.

The certificate issued by the Kerala Motor Transport Workers

Welfare Fund Board, certifying the Deceased as the driver of light

motor   goods   vehicle   bearing   Registration   No.   KL­36­B­7822

under the ownership of one Shri Prakashan has been proved on

record. Further, the Deceased had also paid all his subscriptions

to the Board from April 2012 until the month he died. We find no

reason to doubt that the Deceased was a driver at the time of his

death.  This   Court   in  Chandra   Alias   Chanda   Alias

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Chandraram  and  Anr.   v.  Mukesh  Kumar  Yadav  and  Ors.8

,

has aptly held that in the absence of a salary certificate, the

minimum   wages   notification   along   with   some   amount   of

guesswork that is not completely detached from reality shall act

as a yardstick to determine the income of the deceased. In this

context, keeping in view the import of section 57 of the Indian

Evidence Act, 1872, we  take judicial notice of the provisions of

the Kerala Fair Wages Act, especially section 2 thereof which

defines the following expressions:­ 

“2.        Definitions.­  In   this   Act,   unless   the   context

otherwise requires,­ 

(a)  “employer”  means in relation to any motor transport

undertaking, the person who or the authority which, has

the ultimate control over the affairs of the motor transport

undertaking, and where the said affairs are entrusted to

any other person whether called a manager, managing

director, managing agent or by any other name, such other

person ; 

(b) “motor transport undertaking” means a motor transport

undertaking   including   a   private   carrier   engaged   in

carrying passengers or goods or both by road for hire or

reward ; 

(c)  “motor   transport   worker”  means   a   person   who   is

employed   in   a   motor   transport   undertaking   directly   or

through an agency, whether for wages or not, to work in a

professional capacity on a transport vehicle or to attend to

duties in connection with the arrival, departure, loading or

unloading of such transport vehicle and includes a driver,

conductor,   cleaner,   station   staff,   line   checking   staff,

booking   clerk;   cash   clerk,   depot   clerk,   time   keeper,

watchman, or attendant ; 

(d)  “fair wages” means the rate of wages payable to the

motor transport workers specified in the Schedule to this

Act or the agreed rate of wages whichever is higher.”

8

(2022) 1 SCC 198. 

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(emphasis applied) 

20. Schedule   B­Category   III   of   the   Kerala   Fair   Wages   Act

classifies   a   driver   as   a   “Skilled   worker”.   Reading   this   in

conjunction   with   the   Notification   that   came   into   effect   from

01.01.2015 which amended Schedule A of the Kerala Fair Wages

Act, prescribing a minimum pay scale of the workers listed in

Schedule B, it is apparent that  a ‘driver’ in Kerala earned a

minimum of Rs. 15,600/­ in 2015. It appears to us that the

aforesaid Act and the notification issued thereunder were not

brought to the notice of the Tribunal or the High Court. As a

result  thereto,  the  High  Court  could  not   be  cognizant  of  the

statutory   mandate   prescribing   minimum   wages   for   a   skilled

worker like ‘driver’, and thus, erred in fixing the income of the

Deceased at Rs.10,000/­. We are therefore inclined to fix the

income of the Deceased notionally at Rs. 15,600/­ per month. 

21. As regard to the rental income of the Deceased from leasing

out a room for the conduct of fish vending business, notionally

fixed at Rs.3,500/­ by the Tribunal, we find no valid reason for

making such additions to the income of the Deceased as the

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rental income would be transferred to his legal heirs, who will

continue enjoying the benefits derived from it.  

22. The final notional income of the Deceased must thus be

fixed   at  Rs.15,600  /­  (Rs.  1,87,200/­  per   annum).   Since   the

Deceased   was   of   32   years   old   at   the   time   of   his   death,   the

multiplier applicable in the instant case would be 16, and 40% of

increase   for   future   prospects   deserves   to   be   added   as   the

Deceased was self­employed. One­third of the Deceased’s income

would be deducted towards his personal expense as he had three

dependents. Hence, the compensation payable to the Appellants

under   the   head   of   loss   of   dependency   would   amount   to

Rs.27,95,520/­ (Rs. 15,600 x 140/100 x 12 x 16 x 2/3). 

C.2  Determination of compensation under non­conventional

heads.

23. In all fairness, it may be noted that, Ld. Counsel for the

Insurance Company has urged that the High Court ought not to

have  granted  any  compensation   to  the  Appellants,  under  the

‘non­conventional   heads’   which   is   impermissible   as   per   the

dictum of this Court in Pranay Sethi (supra). We are however,

not inclined to entertain this plea for the simple reason that the

Insurance Company has not chosen to file any appeal against the

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judgment of the High Court. Having acquiesced, the Insurance

Company cannot turn around and question a paltry amount of

compensation   awarded   to   the   Appellants   under   the   ‘nonconventional heads’. However, question of law, in this regard, is

kept open.   

D.     CONCLUSION:

24. In light of the above discussion, the appeal is allowed in

part.

25. We grant Rs. 27,95,520/­ as the total ‘loss of dependency’

on account of the income of the Deceased being calculated at Rs.

15,600/­   i.e.   Rs.1,87,200/­   per   annum.   Upon   adding   the

remaining amount granted by the High Court under different

heads, the total compensation granted to the Appellant comes to

Rs. 29,73,520/­ (Rs.27,95,520/­ + Rs. 1,78,000/­). 

26. The Insurance Company is directed to pay the enhanced

compensation amount of Rs. 29,73,520/­ to the Appellants along

with interest at the rate of 9% per annum from the date of filing

of the claim petition till the date of realisation. The aforesaid

amount shall be apportioned among the Appellants in the ratio

fixed by the Tribunal in the award. The Insurance Company shall

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pay the said amount either by way of demand draft in favour of

the Appellants or deposit the same before the Tribunal, after

deducting the amount already paid by it, if any, within six weeks

from the date of receipt of the copy of this judgment.  

27. The judgment under appeal of the High Court is, thus, set

aside.   The   appeal   is   disposed   of   along   with   any   pending

applications in above terms. 

………………….………..J.

(SURYA KANT)

………………….………..J.

(ANIRUDDHA BOSE)

New Delhi:

October 17th, 2022

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