Full Judgment Text
2025 INSC 1430
Non-Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No. of 2025
(@ Special Leave Petition (C) No.19462 of 2025)
M/s National Insurance Co. Ltd.
...Appellant
Versus
Neeru Devi & Ors.
...Respondents
J U D G M E N T
K. VINOD CHANDRAN, J.
Leave granted.
2. The Insurance Company has in the above case raised
only the question of the exorbitant award made on an
unconscionable computation of the income of the deceased.
The undisputed facts are that the deceased, whose legal
representatives were the claimants, wife and three children,
died in a motor accident on 29.08.2017. The deceased was
driving a vehicle which was hit by another vehicle driven by
the fifth respondent at a very high speed and in a rash and
Signature Not Verified
Digitally signed by
VARSHA MENDIRATTA
Date: 2025.12.15
15:01:27 IST
Reason:
negligent manner. The Tribunal framed two issues;
whether, the death was caused by the fatal injuries caused
Page 1 of 7
CA @ SLP (C) No.19462 of 2025
in the road traffic accident and the quantum of compensation
entitled to the legal representatives. On the issue of death
caused in the road traffic accident, there is no dispute raised
and the dispute is only on the computation of monthly
income.
3. The learned counsel appearing for the
appellant/Insurance Company would point out that the
computation of Rs.95,000/- (Rupees Ninety-five Thousand
only) as monthly income of the claimant is without any basis.
A person who had an income of Rs.95,000/- (Rupees Ninety-
five Thousand only) per month would definitely be liable to
pay income tax. There were no income tax returns
produced by the claimants. The contention raised based on
the loan account produced was that the deceased was
paying EMI to the extent of almost Rs.42,500/- (Rupees
Forty-two Thousand Five Hundred only) per month, for the
two trucks he owned, in which event his income would have
been double the EMI paid. There is no basis for such an
assumption, and the computation of annual income is on
mere surmises and conjectures, argues the learned Counsel
Page 2 of 7
CA @ SLP (C) No.19462 of 2025
for the insurer. It is also submitted that a perusal of the
accounts produced by the claimants itself would indicate
that there were 15 defaults committed by the deceased
which would clearly indicate that he was not getting a
regular income to even pay up the EMIs in time.
4. Learned counsel for the respondents/claimants,
however, would point out that the accounts show a different
picture and evidence due satisfaction of EMIs. In any event,
if there was continuous default, the bank would have
proceeded against the defaulter. It is argued that there was
just compensation awarded by the Tribunal as confirmed by
the High Court especially looking at the reasoning in
1
Gurpreet Kaur v. United India Insurance Company Ltd. .
5. Looking at Gurpreet Kaur, we are not convinced that
the reasoning on the facts therein has any application to the
present case. Therein, the deceased was stated to be
working as a contractor for lifting of earth, for which
purpose, he had also purchased a tractor. The tractor was
purchased on a loan, which had an EMI of Rs.11,550/-
1
2022 SCC Online SC 1778
Page 3 of 7
CA @ SLP (C) No.19462 of 2025
(Rupees Eleven Thousand Five Hundred Fifty only) and
which loan was paid up within a year also. It is on that basis
that the computation of monthly income at Rs.25,000/-
(Rupees Twenty-five Thousand only) was determined by the
Tribunal and accepted by this Court, setting aside the order
of the High Court determining the income on the basis of the
minimum wages at the relevant time.
6. In the present case, the claim petition itself spoke of
the deceased having been a reputed transporter and the
owner of two trucks. This was reiterated by the wife of the
deceased who was examined as PW1 who also stated that
the deceased had also been driving the truck of others for
additional income. The said contention was not at all
established by way of any evidence and pertinently as
noticed by the Tribunal itself, no income tax returns were
filed, which assumes much relevance insofar as the claim of
income exceeding the taxable limit as per the Income Tax
Act.
7. In Gurpreet Kaur (supra), the contention was that the
deceased was an earth-moving contractor for which
Page 4 of 7
CA @ SLP (C) No.19462 of 2025
purpose he was using the tractor, which he had purchased
availing a loan, which also stood cleared by due deposit of
EMIs. The deceased was a 24-year-old whose death would
have deprived the family of the earnings from his avocation
of a contractor. However, in the present case, the deceased
was admittedly a reputed transport contractor and there
would be no difficulty in continuing the business after his
death. The deposition of PW 1 that the trucks were parked
idly cannot at all be accepted. In the very circumstance of
the deceased having owned two trucks, he would have been
engaging a driver to run at least one of them. The death of
the victim in our opinion would not have put a stop to the
income that could be generated from his business;
especially from the two trucks he owned.
8. As has been noticed by the Tribunal at the very
commencement of the award, the Constitution Bench in
2
National Insurance Co. Ltd. v. Pranay Sethi categorically
found that the legal representatives of the deceased in a
motor vehicle accident cannot expect a windfall from a
2
(2017) 16 SCC 680
Page 5 of 7
CA @ SLP (C) No.19462 of 2025
tragedy, nor can the amounts granted be a mere pittance,
an apology for compensation. Keeping the said principle in
mind, we are of the opinion that the amount of Rs.50,00,000/-
(Rupees Fifty Lakhs only) now deposited, on directions
issued by this Court would suffice as compensation for loss
of dependency, which works out to half of the total loss of
dependency as computed by the Tribunal. However,
interest at the rate of 9% per annum would definitely be
entitled to the claimants, which the Insurance Company
would be liable to pay.
9. Additionally, the claimants would be entitled to
compensation for loss of consortium, loss of estate and
funeral expenses as awarded. Further, as has been held in
3
Magma General Insurance Co. Ltd. v. Nanu Ram & Ors.
not only the wife, the children are also entitled to loss of filial
consortium. The claimants would be entitled to a total of
Rs.1,60,000/- (Rupees One Lakh Sixty Thousand only) over
and above the amount deposited. The additional amounts
with the interest due shall also be deposited/paid by the
3
(2018) 18 SCC 130
Page 6 of 7
CA @ SLP (C) No.19462 of 2025
Insurance Company. The total award amount shall carry
interest at the rate of 9% per annum from the date of claim
petition. The balance amount shall be paid by the Insurance
Company to the claimants within a period of one month from
the receipt of this Judgment.
10. The appeal shall stand allowed.
11. Pending applications, if any, shall stand disposed of.
……...…….……………………. J.
(AHSANUDDIN AMANULLAH)
...………….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI
DECEMBER 15, 2025.
Page 7 of 7
CA @ SLP (C) No.19462 of 2025
Non-Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
Civil Appeal No. of 2025
(@ Special Leave Petition (C) No.19462 of 2025)
M/s National Insurance Co. Ltd.
...Appellant
Versus
Neeru Devi & Ors.
...Respondents
J U D G M E N T
K. VINOD CHANDRAN, J.
Leave granted.
2. The Insurance Company has in the above case raised
only the question of the exorbitant award made on an
unconscionable computation of the income of the deceased.
The undisputed facts are that the deceased, whose legal
representatives were the claimants, wife and three children,
died in a motor accident on 29.08.2017. The deceased was
driving a vehicle which was hit by another vehicle driven by
the fifth respondent at a very high speed and in a rash and
Signature Not Verified
Digitally signed by
VARSHA MENDIRATTA
Date: 2025.12.15
15:01:27 IST
Reason:
negligent manner. The Tribunal framed two issues;
whether, the death was caused by the fatal injuries caused
Page 1 of 7
CA @ SLP (C) No.19462 of 2025
in the road traffic accident and the quantum of compensation
entitled to the legal representatives. On the issue of death
caused in the road traffic accident, there is no dispute raised
and the dispute is only on the computation of monthly
income.
3. The learned counsel appearing for the
appellant/Insurance Company would point out that the
computation of Rs.95,000/- (Rupees Ninety-five Thousand
only) as monthly income of the claimant is without any basis.
A person who had an income of Rs.95,000/- (Rupees Ninety-
five Thousand only) per month would definitely be liable to
pay income tax. There were no income tax returns
produced by the claimants. The contention raised based on
the loan account produced was that the deceased was
paying EMI to the extent of almost Rs.42,500/- (Rupees
Forty-two Thousand Five Hundred only) per month, for the
two trucks he owned, in which event his income would have
been double the EMI paid. There is no basis for such an
assumption, and the computation of annual income is on
mere surmises and conjectures, argues the learned Counsel
Page 2 of 7
CA @ SLP (C) No.19462 of 2025
for the insurer. It is also submitted that a perusal of the
accounts produced by the claimants itself would indicate
that there were 15 defaults committed by the deceased
which would clearly indicate that he was not getting a
regular income to even pay up the EMIs in time.
4. Learned counsel for the respondents/claimants,
however, would point out that the accounts show a different
picture and evidence due satisfaction of EMIs. In any event,
if there was continuous default, the bank would have
proceeded against the defaulter. It is argued that there was
just compensation awarded by the Tribunal as confirmed by
the High Court especially looking at the reasoning in
1
Gurpreet Kaur v. United India Insurance Company Ltd. .
5. Looking at Gurpreet Kaur, we are not convinced that
the reasoning on the facts therein has any application to the
present case. Therein, the deceased was stated to be
working as a contractor for lifting of earth, for which
purpose, he had also purchased a tractor. The tractor was
purchased on a loan, which had an EMI of Rs.11,550/-
1
2022 SCC Online SC 1778
Page 3 of 7
CA @ SLP (C) No.19462 of 2025
(Rupees Eleven Thousand Five Hundred Fifty only) and
which loan was paid up within a year also. It is on that basis
that the computation of monthly income at Rs.25,000/-
(Rupees Twenty-five Thousand only) was determined by the
Tribunal and accepted by this Court, setting aside the order
of the High Court determining the income on the basis of the
minimum wages at the relevant time.
6. In the present case, the claim petition itself spoke of
the deceased having been a reputed transporter and the
owner of two trucks. This was reiterated by the wife of the
deceased who was examined as PW1 who also stated that
the deceased had also been driving the truck of others for
additional income. The said contention was not at all
established by way of any evidence and pertinently as
noticed by the Tribunal itself, no income tax returns were
filed, which assumes much relevance insofar as the claim of
income exceeding the taxable limit as per the Income Tax
Act.
7. In Gurpreet Kaur (supra), the contention was that the
deceased was an earth-moving contractor for which
Page 4 of 7
CA @ SLP (C) No.19462 of 2025
purpose he was using the tractor, which he had purchased
availing a loan, which also stood cleared by due deposit of
EMIs. The deceased was a 24-year-old whose death would
have deprived the family of the earnings from his avocation
of a contractor. However, in the present case, the deceased
was admittedly a reputed transport contractor and there
would be no difficulty in continuing the business after his
death. The deposition of PW 1 that the trucks were parked
idly cannot at all be accepted. In the very circumstance of
the deceased having owned two trucks, he would have been
engaging a driver to run at least one of them. The death of
the victim in our opinion would not have put a stop to the
income that could be generated from his business;
especially from the two trucks he owned.
8. As has been noticed by the Tribunal at the very
commencement of the award, the Constitution Bench in
2
National Insurance Co. Ltd. v. Pranay Sethi categorically
found that the legal representatives of the deceased in a
motor vehicle accident cannot expect a windfall from a
2
(2017) 16 SCC 680
Page 5 of 7
CA @ SLP (C) No.19462 of 2025
tragedy, nor can the amounts granted be a mere pittance,
an apology for compensation. Keeping the said principle in
mind, we are of the opinion that the amount of Rs.50,00,000/-
(Rupees Fifty Lakhs only) now deposited, on directions
issued by this Court would suffice as compensation for loss
of dependency, which works out to half of the total loss of
dependency as computed by the Tribunal. However,
interest at the rate of 9% per annum would definitely be
entitled to the claimants, which the Insurance Company
would be liable to pay.
9. Additionally, the claimants would be entitled to
compensation for loss of consortium, loss of estate and
funeral expenses as awarded. Further, as has been held in
3
Magma General Insurance Co. Ltd. v. Nanu Ram & Ors.
not only the wife, the children are also entitled to loss of filial
consortium. The claimants would be entitled to a total of
Rs.1,60,000/- (Rupees One Lakh Sixty Thousand only) over
and above the amount deposited. The additional amounts
with the interest due shall also be deposited/paid by the
3
(2018) 18 SCC 130
Page 6 of 7
CA @ SLP (C) No.19462 of 2025
Insurance Company. The total award amount shall carry
interest at the rate of 9% per annum from the date of claim
petition. The balance amount shall be paid by the Insurance
Company to the claimants within a period of one month from
the receipt of this Judgment.
10. The appeal shall stand allowed.
11. Pending applications, if any, shall stand disposed of.
……...…….……………………. J.
(AHSANUDDIN AMANULLAH)
...………….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI
DECEMBER 15, 2025.
Page 7 of 7
CA @ SLP (C) No.19462 of 2025