Jharkhand HC Reduces Interest Rate, Compensation By MACT To Family Of Deceased 50-Year-Old, Cites Excessive Award Under Conventional Head
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Jharkhand HC Reduces Interest Rate, Compensation By MACT To Family Of Deceased 50-Year-Old, Cites Excessive Award Under Conventional Head

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The Jharkhand High Court has slashed the interest rate on compensation awarded to the family of a 50-year-old barber who was struck by a mini-bus, ruling that the 12% annual interest granted by the Motor Accident Claims Tribunal, Dumka, was excessive. Justice Subhash Chand, presiding over the case, reduced the interest rate to 7.5%, stating, “The impugned Award passed by the learned Tribunal is modified to the extent that the total amount of compensation which would be payable to the claimants would be ₹8,17,600/- and 7.5% interest would be payable thereon from the date of filing the claim petition i.e., 30th March, 2012 till the date of actual payment.” Additionally, Justice Chand struck down the 18% penal interest imposed by the MACT, while emphasizing, “So far as the penal interest of 18% is concerned, the same also needs interference, reason being that if the said amount of Award along with interest is not paid by the Insurance Company within 45 days from the date of passing Award, for the same, execution proceeding may be initiated by the claimants under Section 174 of the Motor Vehicles Act. the same should not have been relied upon by the learned Tribunal because the Hon'ble Apex Court has awarded the said amount under the conventional head by exercising the power under Article 142 of the Constitution of India.” Instead, the High Court recalculated the compensation based on the principles laid out in National Insurance Company Ltd. vs. Pranay Sethi and Ors. Referring to the Supreme Court's ruling in National Insurance Company Ltd. vs. Mannat Johal and Ors., 2019 TAC 705, the High Court noted, “The Tribunal had awarded interest at the rate of 12% p.a. The court observed: “If the said amount of Award along with interest is not paid by the Insurance Company within 45 days from the date of passing Award, for the same, execution proceeding may be initiated by the claimants under Section 174 of the Motor Vehicles Act.” Case Title: The Oriental Insurance Company Limited vs Most.

History of this topic

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