In a significant ruling reaffirming the principle that compensation in motor accident claims should be “just and fair,” a Division Bench of the Andhra Pradesh High Court comprising Justice Ravi Nath Tilhari and Justice Challa Gunaranjan has enhanced the compensation awarded to the family of a 28-year-old accident victim from ₹28.39 lakh to ₹46.10 lakh, along with 9% interest per annum.
Background:
The case originated from a motor accident that took place on June 13, 2019, at about 10:40 PM near the railway gate at S. Kothapalli village, Kodur Mandal. The deceased, Shaik Haneef, a 28-year-old carpenter and sculpture worker, was riding a Yamaha Scooty when he fatally collided with a stationary lorry (bearing No. AP 03 T 2529) that was parked without any warning signals or lights. His family—six claimants in total—filed a claim under Section 166 of the Motor Vehicles Act, 1988, seeking ₹30 lakhs in compensation.
Legal Issues Before the Court:
- Whether the deceased was contributorily negligent in the accident.
- Whether the compensation awarded by the Tribunal was just and fair.
High Court Observations and Findings:
1. No Contributory Negligence:
Rejecting the insurer’s claim that the deceased was at fault for hitting the lorry from behind, the Court observed:
“Had the lorry been properly parked with its parking lights on, or with appropriate precautions taken to signal its presence, a driver or rider approaching from behind would have been alerted.”
The Court relied on Usha Rajkhowa v. Paramount Industries [(2009) 14 SCC 71] and Anitha Sharma v. New India Assurance Co. [(2021) 1 SCC 171] to stress that motor accident claims are to be adjudicated on the basis of preponderance of probabilities, not criminal standards of proof.
“There is absolutely no evidence to suggest that the deceased failed in any duty of care,” the Court emphasized.
2. Just and Fair Compensation Enhanced:
The Tribunal had assessed the monthly income of the deceased at ₹20,000 based on oral testimony from PW-3, his employer. While the insurer challenged the reliability of the income certificate, the High Court accepted the oral deposition as credible.
“We find no illegality in the determination of the deceased’s income as ₹20,000 per month.”
Additionally, applying a 40% addition for future prospects (as per Pranay Sethi [(2017) 16 SCC 680]), and adjusting deduction for personal expenses to 1/4th instead of 1/3rd (as per Sarla Verma [(2009) 6 SCC 121]), the Court recalculated the dependency compensation.
Amounts under conventional heads—such as consortium (₹48,400 per claimant), funeral expenses (₹18,150), and loss of estate (₹18,150)—were revised upward, based on recent precedents like Rojalini Nayak v. Ajit Sahoo [2024 SCC OnLine SC 1901].
Final Compensation Breakdown:
| Component | Amount |
| Annual income (₹20,000 x 12) | ₹2,40,000 |
| Future Prospects (40%) | ₹96,000 |
| Less: 1/4th deduction | ₹84,000 |
| Net Annual Loss | ₹2,52,000 |
| Multiplier (17 for age 28) | ₹42,84,000 |
| Loss of Consortium (₹48,400 x 6) | ₹2,90,400 |
| Loss of Estate | ₹18,150 |
| Funeral Expenses | ₹18,150 |
| Total | ₹46,10,700 |
Interest Rate Revised to 9%:
Citing Kumari Kiran v. Sajjan Singh [(2015) 1 SCC 539] and Rahul Sharma v. National Insurance Co. [(2021) 6 SCC 188], the Court increased the interest rate on compensation from 7.5% to 9% per annum, payable from the date of claim petition till realization.
Verdict:
- Insurance Company’s Appeal: Dismissed
- Total Compensation Enhanced: From ₹28,39,000 to ₹46,10,700
- Interest Rate: 9% p.a.
- Costs: In favour of claimants
“The compensation must be ‘just’ and it cannot be a bonanza: not a source of profit; but the same should not be a pittance.”
This ruling once again affirms that courts must prioritize equitable standards in determining compensation, especially in tragic cases where the breadwinner of a family is lost.
Case Details:
- Case Title: The Oriental Insurance Company Ltd. v. Zakeeya Begum and Others
- Case Number: M.A.C.M.A. No.487 of 2024
- Bench: Justice Ravi Nath Tilhari and Justice Challa Gunaranjan
- Appellant Counsel: Sri M. Solomon Raju
- Respondents’ Counsel: Sri G. Divya Theja representing Sri Srinivas Ambati
