Fixing of notional income of a non earning member in motor accident claims cases

 

FIXING OF NOTIONAL INCOME OF A NON EARNING MEMBER IN MOTOR ACCIDENT CLAIMS CASES.

The notional income of a non – earning member may be fixed at Rs.25,000/pa. This aspect has been clearly discussed in 2021(2) TNMAC 801 (SC) kurvan Ansari alias kurvan Ali and another   VS   Shyam kishore murmur and another.

The brief facts of the case are as follows:

Son of the appellant aged 7 years studying class 2, was standing by side of the road in front of his maternal grandpa’s house, a motorcycle has dashed him causing grievous injuries resulting in his death. On account of said  accident, which resulted which resulted the death of the child of the claimants, they filed a claim petition under sec 163 A of the motor vehicles act claiming compensation. Before the tribunal it was the case of the claimants that the accident had occurred due to rash and negligent driving of the driver of the offending vehicle, the deceased boy was aged about 7 years at the time of the accident and he was studying in class 2. The tribunal by appreciating oral and documentary evidence on record, has come to the conclusion that the accident has occurred due to rash and negligent driving of the motorcycle’s driver. The tribunal considering notional income of the deceased at Rs.15,000/pa, by applying multiplier of 15 awarded compensation of Rs.2,25,000 with interest @ 6% pa from the date of judgment. Since the driver of the motorcycle was not possessing valid driving license at the time of accident, the tribunal directed insurance company to pay the compensation to the claimants and recover the same from its owner.

 Pleading contributory negligence, the insurance company had preferred an appeal and for enhancement of compensation, the claimants have preferred appeal.

By the impugned judgment, the high court has dismissed the appeal preferred by the insurance company and partly allowed the appeal preferred by the claimants by awarding a further sum of Rs.15,000 towards funeral expenses. Thus it is held that the appellants are entitled to a sum o Rs.2,40,000/ towards compensation with interest as awarded by the tribunal from the date of filing claim petition.

Learned counsel for the appellants contended that the compensation awarded by the tribunal as confirmed by the high court is on lower side and is not just and fair. The learned counsel also contended that the compensation was  awarded by assuming income of the deceased notionally at Rs.15,000/ per annum as per schedule – II of the motor vehicles act,1988 which is applicable to claims made under sec. 163 A of the motor vehicles act. It is submitted that the notional income of Rs.15,000/ pa was fixed as early as in the year 1994 and somehow, the same is continued in the statute without any amendment in spite of repeated directions by this court. It is submitted that in view of the provisions under sec 163 A (3) of the motor vehicles act, though it was obligatory on the part of the government to amend schedule II, same as fixed in the year 1994, continued since then. Thus it is submitted that the notional income as fixed is to be considered by taking into account increase in the cost of living.

On the other hand, learned counsel for the insurance company has submitted that there are no grounds to interfere with the impugned judgment of the high court.

As the claim was made under sec 163 A of the motor vehicles act, 1988, since the deceased child was not an earning member, the tribunal has considered notional income as per schedule II for the purpose of fixing compensation. The tribunal has awarded compensation by taking notional income of the deceased at Rs. 15,000/ per annum by applying multiplier 15 awarded compensation of Rs.2,25,000/ towards loss of dependency. When the appeals were preferred by the insurance company as well as appellants herein, by the impugned common judgment the high court has dismissed the appeal preferred by the insurance company and enhanced compensation I appeal preferred by the claimants.

In the judgment in case of puttamma and others, the apex court has observed that the central government was bestowed with the duties to amend schedule II in view of section 163 A (3) of the motor vehicles act, but it failed to do so. In view of the same, specific directions were issued to the central government to make appropriate amendments to schedule II keeping in mind the present cost of living. In the said judgment till such amendments are made, directions were issued for award of compensation by fixing a sum of Rs.1,00,000/ towards compensation for the non – earning children up to the age of 5 years old and a sum of Rs.1,50,000/ for the non – earning persons of more than 5 years old.

In this case it is to be noted that the accident was during 2004. In spite of repeated directions, schedule II is not yet amended. Therefore, fixing notional income at Rs.15,000 pa for non – earning member is not just and reasonable.

It is a fit case to increase notional income by taking into account the inflation, devaluation of the rupee and cost of living. In view of the same, it is appropriate to take notional income of the deceased at Rs.25,000/pa. Hence the apex court fixed notional income of a non – earning member as Rs. 25,000/pa.