Average Income Of Previous Years No Basis For Compensation: Jharkhand HC Upholds Reliance On Deceased's Last Earned Salary In Accident Case
Live LawThe Jharkhand High Court, in its judgment delivered in a Miscellaneous Appeal, held that the average income of previous financial years cannot be the basis for computing compensation in motor accident claims. Sarla Verma and Ors vs Delhi Transport Corporation and Anr., which provides, “the deduction towards personal and living expenses of the deceased, should be one-third where the number of dependent family members is 2 to 3, one-fourth where the number of dependant family members is 4 to 6.” Additionally, the court modified the interest rate awarded by the Tribunal from 9% to 7.5% per annum, citing the Supreme Court's decision in National Insurance Company Vs. Mannat Johal. The Court noted, “So far as the interest on the compensation amount is concerned, which the learned Tribunal has awarded 9% interest, that 9% interest is not tenable it could have been 7.5% per annum.” The High Court affirmed that the dependents entitled to compensation included Kumar's widow, two sons, and his mother. On this, the court stated, “from the evidence on record, the deceased after his death left his widow, two sons and mother, who left his four dependents upon him after his death.” Accordingly, the appeal was partly allowed and the impugned award passed by the MACT was modified only to the extent of interest payable on the amount of compensation as awarded by the Tribunal from 9% to 7.5% per annum.