Supreme Court of India
Kavita Devi vs Sunil Kumar on 6 August, 2025
Author: Aravind Kumar
Bench: Aravind Kumar, Sudhanshu Dhulia
2025 INSC 938 NON-REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S) OF 2025
(@ SPECIAL LEAVE PETITION (CIVIL) NO(S). OF 2025
(@DIARY NO(S). 47285 OF 2018)
KAVITA DEVI AND OTHERS …APPELLANT(S)
VERSUS
SUNIL KUMAR AND ANOTHER …RESPONDENT(S)
JUDGMENT
ARAVIND KUMAR, J.
1. Heard
2. Leave Granted
3. Appellants being the Claimants in a petition filed under Motor
Vehicle Accident Claim1 under Section 166 of the Motor Vehicles Act
(hereinafter referred to as the Act) are before this Court seeking
enhancement of compensation. Claimants being the Wife and two children
of the one Lokender Kumar (hereinafter referred to as the deceased) who
Signature Not Verified
Digitally signed by
Nirmala Negi
expired on account of injuries sustained in a Motor Vehicle Accident filed a
Date: 2025.08.06
18:43:26 IST
Reason:
1 M.A.C.T. Case. No. 98 of 08.08.2009.
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claim petition before the Motor Vehicle Accident Claims Tribunal2
(hereinafter referred to as the Tribunal) seeking compensation of
Rs. 25,00,000/-. The Tribunal vide its award dated: 12/04/2010 awarded
compensation of Rs. 2,54,720/- with interest @ 7% p.a. Aggrieved by the
award of the Tribunal, the claimants filed an Appeal3 before the High Court
seeking enhancement of compensation and High Court by the impugned
order dated: 20/08/2013 enhanced the compensation from Rs. 2,54,720/- to
Rs. 7,23,680/- with interest @7% p.a. The claimants not being satisfied with
the award of the High Court, have filed this Appeal seeking further
enhancement of compensation.
BRIEF FACTS:
4. At around 7.00. a.m. on 16/02/2009 when the deceased was
proceeding to his office located in Gurgaon and when he reached Angana
Restaurant situated in Sohna-Gurgaon Road, a Santro car bearing
registration No. HR-26-AN-3670 driven in a rash and negligent manner by
Respondent No. 1 dashed against the deceased causing severe injuries,
because of which the deceased succumbed at the spot.
5. At this juncture it is apposite to mention that this Court will only
examine the issue related to enhancement of compensation and will not enter
into the question of the cause of the accident, as both the Tribunal and the
High Court have concurrently held that the accident has occurred because of
the rash and negligence of the offending vehicle and there being no serious
dispute on this finding.
2 Motor Vehicle Claims Tribunal, Gurgaon.
3 FAO No. 1518 of 2011 before the Punjab and Haryana High Court.
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AWARD OF THE TRIBUNAL AND HIGH COURT
6. Claimants pleaded in their claim petition that at the time of death
deceased was aged 35 years and he was working in R.M. Manpower
Services, Gurgaon, Haryana and receiving salary of Rs. 6500/- per month
and he was also doing agricultural work and earning Rs. 5000/- per month,
meaning thereby that at the time of incident the deceased was earning Rs.
11,500/- per month. The Claimants also examined PW4 – Inder Singh,
Manager of M/S R.M Manpower Services, Kamla Palace, Jail Road,
Gurgaon to prove the employment of the deceased in their firm and his
income. PW4 stated that the deceased was working as an operator in their
firm and he produced a salary slip before the Tribunal which was marked as
Ex. P6 which indicated that deceased was earning Rs. 6,500/- per month
including allowances. Though PW4 proved the salary slip, in his cross-
examination, he said that the deceased was earning Rs. 3,665/- as basic pay.
7. The Tribunal, while determining the income of the deceased held
that, in the Half-Yearly ESI Return (Form 6) for October 2008 to March
2009, wages paid to the deceased for 4.5 months total Rs. 28,832/-,
averaging about Rs. 6,407/- per month was indicated. However, in Form 6A
(for unexempted establishments) from March 2008 to February 2009, the
deceased’s wages from 12.08.2008 to 16.02.2009 (approx. 6 months) was
stated as Rs. 21,938/-, i.e., around Rs. 3,665/- per month. There is a
significant discrepancy between the income figures in Form 6 and Form 6A,
which remains unexplained in the records. Because of this inconsistency and
considering the fact that Rs. 6,500/- salary per month included in itself Rs.
1,100/- for the purposes of House Rent Allowance and Rs. 1,735/- for the
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purposes of unspecified allowances, the Tribunal held that the income of the
deceased was Rs. 3,665/- per month excluding the allowances.
8. Further, considering the four-members of his family were
dependent on his income deducted Rs. 1,220/- p.m. towards personal
expenses. Hence, the Tribunal determined that the deceased would be
contributing Rs. 2,445/- per month for his family’s upkeep. The Tribunal
taking the multiplier as 8 and annual income at Rs. 29,340/- and his
employment being private, awarded a compensation of Rs. 2,34,720/-
(2,445/- X 12 X 8) under the head of loss of dependency, Rs. 10,000/- each
under the heads of funeral and transportation charges and loss of consortium
for claimant No.1. Thus, in total the Tribunal awarded a sum of Rs. Rs.
2,54,720/- @7% interest p.a. under the following heads:
Heads Compensation
Loss of Dependency 2,34,720/-
Loss of Spousal Consortium 10,000/-
Funeral expenses 10,000/-
TOTAL Rs.2,54,720/-
9. In the appeal filed by claimants seeking enhancement of
compensation, the High Court accepted the Tribunal’s computation with
regard to determination of the income of the deceased. However, held that
the Tribunal has failed to add future prospects of 50% to the income of the
deceased and the High Court further held that the Tribunal has applied
multiplier of 8 erroneously and also held that the deduction carried out was
not in accordance with the decision of Sarla Verma and Others v. Delhi
Transport Corporation and Another4.
4 (2009) 6 SCC 121
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10. The High Court by taking the income of the deceased as Rs.
3,665/month added Rs. 1832/- to the income as future prospects. After
adding future prospects, the monthly income of the deceased would be Rs.
5497/-, deducting 1/3rd of the income towards personal expenses the actual
income of the deceased would be Rs. 3,665/-. Further considering the age of
the deceased as 35 ½, the High Court adopted the multiplier of 16 and
accordingly determined the compensation under the head of loss of
dependency at Rs. 7,03,680/- (3665 x 12 x 16). High Court further awarded
Rs. 20,000/- in total under the heads of loss of estate, loss of consortium and
expenses on last rites. Thus, vide impugned order the High Court enhanced
the compensation from Rs. 2,54,720/- to Rs. to Rs. 7,23,680/- with interest
@7% p.a.
11. Claimants seeking further enhancement of compensation have filed
this Appeal.
SUBMISSIONS OF THE COUNSELS
12. Mr. Fuzail Ahmad Ayyubi, Learned Counsel for the Appellants
contended:
12.1. That the impugned order has not considered the judgment of the
Constitution Bench in National India Insurance Company Limited v.
Pranay Sethi and Others.5 Whereunder this Court held Rs. 15,000/- each
is to be awarded under the conventional heads of funeral expenses and loss
of estate, and further held that Rs. 40,000/- has to be added under the head
of loss of consortium. The High Court has awarded a total of Rs. 20,000/-
5 2017 (16) SCC 680
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under all the above-mentioned heads therefore the compensation should be
enhanced.
12.2. In spite of the production of the Salary Certificate as Ex. P6, the
Tribunal as well as the High Court has ignored the fact that the deceased was
earning Rs. 6,500/- per month therefore the Courts below erred in not
considering the same and considering the fact that wife and two minor
children are the claimants whole Rs. 6,500/- must be considered as the
income of the deceased for computation of the compensation.
12.3. Both the Tribunal and the High Court has not considered the aspect
of Agricultural Income at all. Therefore, the Claimants are entitled to
enhancement of compensation after the income from agriculture is added to
Rs. 6,500/-.
13. Ms. Suman Bagga, Counsel appearing for the Insurance Company
supported the impugned order and sought for the dismissal of the Appeal.
ANALYSIS:
14. Having considered the material available on record and the
submissions of the learned counsel appearing for the parties, we are of the
opinion that though the High Court has enhanced the compensation, the
same is on lower side.
15. Firstly, as can be seen from the salary slip which is marked as Ex.
P6, it can be seen that the deceased was earning Rs. 6,500/- p.m. However
the Tribunal on a hyper technicality namely certain discrepancy in Form 6
and Form 6A considered the basic salary of the deceased as Rs. 3,665/- p.m.
after excluding the HRA and other allowances. The question that falls for
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our consideration is that, whether the HRA and the other allowances is to be
deducted while determining the income of the deceased in this case.
16. This Court in Sarla Verma (supra) has clarified that for the purpose
of computation, actual income of the deceased has to be taken into
consideration. This Court in National Insurance Co. Ltd. v. Indira
Srivastava and Others6, this Court while interpreting the words ‘just
compensation’ and ‘income’ held as follows:
“9. The term ‘income’ has different connotations for different purposes. A
court of law, having regard to the change in societal conditions must
consider the question not only having regard to pay packet the employee
carries home at the end of the month but also other perks which are
beneficial to the members of the entire family. Loss caused to the family
on a death of a near and dear one can hardly be compensated on monetary
terms.
10. Section 168 of the Act uses the word ‘just compensation’ which, in our
opinion, should be assigned a broad meaning. We cannot, in determining
the issue involved in the matter, lose sight of the fact that the private
sector companies in place of introducing a pension scheme takes
recourse to payment of contributory Provident Fund, Gratuity and other
perks to attract the people who are efficient and hard working. Different
offers made to an officer by the employer, same may be either for the
benefit of the employee himself or for the benefit of the entire family. If
some facilities are being provided whereby the entire family stands to
benefit, the same, in our opinion, must be held to be relevant for the
purpose of computation of total income on the basis whereof the amount
of compensation payable for the death of the kith and kin of the
applicants is required to be determined.
…………
18. In Rathi Menon v. Union of India [(2001) 3 SCC 714], this Court,
upon considering the dictionary meaning of compensation held:
“24. In this context a reference to Section 129 of the Act
appears useful. The Central Government is empowered by
the said provision to make rules by notification “to carry out
the purposes of this Chapter”. It is evident that one of the
purposes of this chapter is that the injured victims in railway
accidents and untoward incidents must get compensation.
Though the word “compensation” is not defined in the Act
or in the Rules it is the giving of an equivalent or substitute6 (2008) 2 SCC 763
7
of equivalent value. In Black’s Law Dictionary ,
“compensation” is shown as
“equivalent in money for a loss sustained; or giving
back an equivalent in either money which is but the
measure of value, or in actual value otherwise
conferred; or recompense in value for some loss,
injury or service especially when it is given by
statute.”
It means when you pay the compensation in terms of
money it must represent, on the date of ordering such
payment, the equivalent value.
25. In this context we may look at Section 128(1) also. It says
that the right of any person to claim compensation before
the Claims Tribunal as indicated in Section 124 or 124-A
shall not affect the right of any such person to recover
compensation payable under any other law for the time
being in force. But there is an interdict that no person shall
be entitled to claim compensation for more than once in
respect of the same accident. This means that the party has
two alternatives, one is to avail himself of his civil remedy
to claim compensation based on common law or any other
statutory provision, and the other is to apply before the
Claims Tribunal under Section 124 or 124-A of the Act. As he
cannot avail himself of both the remedies he has to choose
one between the two. The provisions in Chapter XIII of the
Act are intended to provide a speedier remedy to the victims
of accidents and untoward incidents. If he were to choose
the latter that does not mean that he should be prepared to
get a lesser amount. He is given the assurance by the
legislature that the Central Government is saddled with the
task of prescribing fair and just compensation in the Rules
from time to time. The provisions are not intended to give a
gain to the Railway Administration but they are meant to
afford just and reasonable compensation to the victims as a
speedier measure. If a person files a suit the amount of
compensation will depend upon what the court considers
just and reasonable on the date of determination. Hence
when he goes before the Claims Tribunal claiming
compensation the determination of the amount should be
as on the date of such determination.”
19. The amounts, therefore, which were required to be paid to the deceased
by his employer by way of perks, should be included for computation of
his monthly income as that would have been added to his monthly income
by way of contribution to the family as contradistinguished to the ones
which were for his benefit. We may, however, hasten to add that from the
said amount of income, the statutory amount of tax payable thereupon must
be deducted.
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20. The term ‘income’ in P. Ramanatha Aiyar’s Advanced Law Lexicon
(3rd Ed.) has been defined as under:
“The value of any benefit or perquisite whether convertible
into money or not, obtained from a company either by a
director or a person who has substantial interest in the
company, and any sum paid by such company in respect of
any obligation, which but for such payment would have
been payable by the director or other person aforesaid,
occurring or arising to a person within the State from any
profession, trade or calling other than agriculture.”
It has also been stated:
‘INCOME’ signifies ‘what comes in’ (per Selborne, C.,
Jones v. Ogle, 42 LJ Ch.336). ‘It is as large a word as can
be used’ to denote a person’s receipts ‘(per Jessel, M.R. Re
Huggins, 51 LJ Ch.938.) income is not confined to receipts
from business only and means periodical receipts from
one’s work, lands, investments, etc. AIR 1921 Mad 427
(SB). Ref. 124 IC 511 : 1930 MWN 29: 31 MLW 438 AIR
1930 Mad 626 : 58 MLJ 337.”
21. If the dictionary meaning of the word ‘income’ is taken to its logical
conclusion, it should include those benefits, either in terms of money or
otherwise, which are taken into consideration for the purpose of payment
of income-tax or profession tax although some elements thereof may or
may not be taxable or would have been otherwise taxable but for the
exemption conferred thereupon under the statute.”
(emphasis supplied)
17. This Court has consistently held in case of the allowances which are
included in the component of salary of the deceased, Tribunal has to take
into consideration these allowances as they were used for supporting the
family. The claimants have to show that these allowances were regularly
received and used for the family’s benefit. Further, while determining
whether the allowances form a part of the salary or not, the Tribunal by
looking into the facts of each case and by considering the extent of
dependency of the claimants on the salary of the deceased including the
allowances, have to determine whether these allowances should be excluded
from determination of the income of the deceased. If the answer of the
Tribunal is in affirmative, then the allowances may be excluded for
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determination of loss of dependency. If the Tribunal answers the above point
in negative, then the Tribunal has to include the allowances for computation
of income of the deceased, thus determining the loss of dependency.
18. Applying the above principle to the case on hand, it can be seen that
it is the consistent plea of the claimant that the deceased was earning Rs.
6,500/- and the same is evidenced by producing Ex. P6. No contrary
evidence is produced by the Respondents to dispute the fact that the
allowances which is about 50% of the salary of the deceased should be
excluded from determination of the actual income. Further, it can be seen
that after the accident, the entire burden of taking care of two minor children
and herself fell on Appellant No.1. Therefore in view of the changing
economic situation of the family after the death of the deceased, we are of
the opinion that income which the deceased was earning at the time of the
accident was Rs. 6,500/- p.m and same ought to have been taken into
consideration.
19. Secondly, applying the principles laid down by this Court in Sarla
Verma (supra) which was affirmed by the dictum of the Constitution bench
in Pranay Sethi, out of Rs. 6,500/-, 1/3rd has to be deducted for the personal
expenses of the deceased, thus Rs.6,500/- x 1/3 = 2,167. Therefore, the
monthly income of the deceased would be Rs. 4,333. Considering the age of
the deceased i.e. 35 years, 50% future prospects must be added to the income
of Rs. 4,333 i.e. 4,333 x 50% = Rs. 2,167/-. Thus, the monthly income of the
deceased after adding future prospects would be Rs. 4,333 + 2,167 =
Rs.6,500/-. Further the appropriate multiplier to be adopted as per the
judgment of Sarla Verma (supra) would be 16. Therefore, we award a sum
of Rs. 12,48,000/- under the head of loss of dependency (6,500 x 12 x 16).
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20. Thirdly, the claimants are entitled to a sum of Rs. 18,150/- each
under the heads of loss of estate and funeral expenses. Further, we award a
sum of Rs. 48,400/- to Appellant No.1 under the head of spousal consortium
and Appellant No.2 and 3 would be entitled to a sum of Rs. 48,400/- each
under the head of parental consortium as per the law laid down in Magma
General Insurance Company Limited v. Nanu Ram Alias Chuhru Ram
and Others7.
21. Therefore, in total the Appellants would be entitled to a sum of Rs.
14,29,500/- under the following heads:
Heads Compensation
Loss of Dependency 12,48,000/-
Loss of spousal consortium 48,400/-
Loss of parental consortium 48,400 x 2 = 96, 800/-
Loss of Estate 18,150/-
Funeral Expenses 18,150/-
TOTAL 14,29,500/-
22. The Respondents are jointly and severally liable to pay aforesaid
compensation to the claimants. However, considering the fact that this
Appeal is preferred after a period of 1855 days delay and further there is a
delay of 75 days in refiling, the Respondents are not liable to pay interest for
this delay period as ordered while disposing the application for condonation
of delay. Respondent No.3 is hereby directed to deposit a sum of Rs.
14,29,500/- with interest @7% p.a. from the date of the filing of the petition
till deposit, excluding the period of delay, before the jurisdictional Tribunal
within a period of 8 weeks from the date of this judgment. Claimant Nos.1
to 3 shall be entitled to receive compensation in the ratio of 50:25:25, along
7 (2018) 18 SCC 130
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with proportionate interest. The compensation awarded to Claimant No.1,
along with proportionate interest, shall be released in their favour by the
Jurisdictional Tribunal. The compensation awarded to Claimant Nos. 2 and
3, along with proportionate and accrued interest, shall be kept in fixed
deposits (FD) in any nationalized bank of Claimant No.1’s choice. Claimant
No.1 shall be entitled to receive the periodical interest from the said fixed
deposits, which shall be utilized for the benefit of Claimant Nos.2 and 3. The
majority of the proceeds from the fixed deposits shall be paid to Claimant
Nos.2 and 3 on proper identification. Consequently, the Appeal is allowed
in part. Pending applications, if any are consigned to records.
.……………………………., J.
[SUDHANSHU DHULIA]
.……………………………., J.
[ARAVIND KUMAR]
New Delhi;
August 06, 2025.
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