Full Judgment Text
2025 INSC 822
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
SPECIAL LEAVE PETITION (C) NO.11340 OF 2020
THE ORIENTAL INSURANCE CO. LTD.
…PETITIONER
VERSUS
NIRU @ NIHARIKA & ORS.
…RESPONDENTS
W I T H
SPECIAL LEAVE PETITION (C) NO.22136 OF 2024
J U D G E M E N T
K. VINOD CHANDRAN, J.
1. The wife and two minor children of the deceased in a
motor vehicle accident were before the Motor Accident
Claims Tribunal for compensation on loss of dependency.
The accident occurred on 18.11.1995 when the deceased was
travelling in a car which collided with a truck. On the
allegation of rash and negligent driving of the truck, the
Signature Not Verified
Digitally signed by
DEEPAK SINGH
Date: 2025.07.14
15:48:05 IST
Reason:
claimants were before the Tribunal seeking compensation of
Page 1 of 10
SLP (C) No.11340 of 2020
Rs.1,00,00,000/- which was later amended and enhanced to
Rs.1,30,00,000/-. The deceased alongwith his family, the
claimants were residing in the United Kingdom. The
deceased was a person with several academic achievements
working as an Engineer with the British Telecom and was
paid salary in Pounds.
2. The Tribunal found negligence of the driver of the truck
relying on the F.I.R. as also the award passed in a claim
petition filed by the driver of the car, wherein negligence was
clearly found on the truck driver. The income stood proved
rd
and the Tribunal adopted a multiplier of 13 and reduced 1/3
of the income for personal expenses. Loss of dependency
was computed at Rs.78,33,540/- to which award, Rs.40,000/-
as loss of consortium and Rs.15,000/- each for loss of estate
and funeral expenses were added. The total compensation
awarded was Rs.79,04,540/-.
3. The Insurance Company filed an appeal before the
High Court against the award amounts raising multifarious
Page 2 of 10
SLP (C) No.11340 of 2020
contentions. It was first contended that the accident occurred
only due to the rashness and negligence of the car driver. On
the quantum, it was submitted that admittedly the wife
married in the year 2002 and the multiplier should have been
only 7, taken from the death of the first husband. The
exchange rate as adopted by the Tribunal, was also assailed
together with the interest granted at the rate of 9%, which it
was contended was against the existing interest rates.
Specific contention was taken against the long delay in
disposing of the claim petition, which was filed in the year
1995 and disposed of in the year 2017. The allegation was that
the claimants who were residing in the U.K. were solely
responsible for the delay occasioned. We see the said
contention having been taken relying on Annexure A-4
produced in the memorandum of SLP filed.
4. The High Court affirmed the negligence of the truck
driver and interfered with the quantum only to the extent of
reducing the average exchange rate as existing in the years
1995 & 1996. The exchange rate of Indian Rupee per Pound
Page 3 of 10
SLP (C) No.11340 of 2020
was determined at Rs.52.3526 as against the determination of
Rs.54.2601 by the Tribunal. The Insurance Company has filed
the appeal to cause further interference to the quantum on the
various other grounds taken before the Tribunal which
according to the Insurance Company was not considered at
all by the Tribunal.
5. The Insurance Company has specifically stated in the
appeal memorandum that based on the exchange rate
applicable at the time of the accident, the monthly income of
the deceased should only have been Rs.56,168 (1072.94 x
52.35); which was accepted by the High Court. The Tribunal
rd
and the High Court were correct in having deducted 1/3 for
personal expenses and the addition made of 30% for future
prospects.
6. One other compelling contention taken by the
Insurance Company before the High Court and this Court is
that the first respondent-wife of the deceased admitted that
she got remarried in 2002 and after that she alongwith her
Page 4 of 10
SLP (C) No.11340 of 2020
children was living with her second husband. She also
admitted that the pension she received from the deceased
husband’s employer was stopped after that. Obviously, the
loss of dependency of the claimants could be assessed only
for 7 years; i.e. from 1995-2002, argues the insurer.
Presumably the family pension was only payable to the wife
and when she got remarried, the same was stopped.
However, it cannot be said that the minor children were not
entitled to the multiplier as adopted by the Tribunal. In such
circumstances, we find absolutely no reason to interfere with
the multiplier adopted by the Tribunal & affirmed by the High
Court. The compensation for loss of dependency would thus
rd
be; Rs.56,165 x 130% x 12 x 13 x 2/3 = Rs.75,93,508/-. To
the said amount would be added Rs.70,000/-, being the
amounts granted by the Tribunal for loss of consortium, loss
of estate and funeral expenses. The total award hence would
be Rs.76,63,508/-, as determined by the High Court too.
7. Yet another contention taken up is the interest granted
at the rate of 9%. The Insurance Company relies on Annexure
Page 5 of 10
SLP (C) No.11340 of 2020
P-1 history of the case to contend that there was undue delay
caused by reason of the claimants having not entered their
evidence. From Annexure P-1, we see that the claim petition
was filed on 28.12.1995 and it first came up for hearing on
11.09.2012. It is seen from Annexure P-1 that the case was
posted for applicants’ evidence on various dates from 2012 to
2016. However, there is nothing to indicate that it was only by
reason of the claimants’ absence that the consideration was
delayed. Merely because, on various dates, for 4 years, the
case was posted for the claimants’ evidence, it does not
necessarily mean that the claimants were responsible for the
delay. Laws delays cannot, without proper substantiation, be
cast upon the shoulders of one or other party to the lis. We
hence do not find any reason to find the delay to be the sole
responsibility of the claimants and in that circumstance
necessarily interest must run from the date of filing of the
claim petition, to the date of payment; for which precedents
are legion, and we need not refer to them.
Page 6 of 10
SLP (C) No.11340 of 2020
8. Further contention taken is the higher rate of interest of
9%, in challenge of which several precedents were placed
before us. From the decisions perused what emanates is that
in the 1980’s, Courts were awarding 12% interest which stood
st
reduced to 9% in the 1990’s. With the advent of the 21
century and the economic recession world over, the interest
rates fell considerably. But even now the rates offered by
National Banks for long term deposits are 7% or more.
Considering the over-all circumstances especially the long
delay caused, we are of the opinion that 9% interest rate
granted by the Tribunal is perfectly in order especially
noticing the accident having occurred in the year 1995.
9. A very relevant issue agitated by the Insurance
Company is the illegality in awarding interest for future
prospects, which in any event is an amount received in
advance, normally inuring to the benefit of the claimants only
in future. This is the only contention taken in the connected
appeal bearing SLP(C) No.22136 of 2024. We find absolutely
no reason to accept this argument. In SLP(C) No.11340 of
Page 7 of 10
SLP (C) No.11340 of 2020
2020, the multiplier applied looking at the life span of the
deceased and the claimants is 13. Before the Tribunal itself,
the case was pending for 12 years and the only amount
received by the claimants was Rs.50,000/-. Hence though
amounts are awarded for future prospects taking the
multiplier of 13; in effect, the money is received only after the
period for which the multiplier is adopted. Similar is the case
in SLP(C) No.22136 of 2024 where the accident occurred in
2018, the multiplier applied is 17 and we are seven years
from the date of accident.
10. We cannot but observe that there was nothing stopping
the Insurance Company from settling the claim on a
computation, on receipt of intimation of the accident,
especially since the determination of compensation for loss
of dependency, on death being occasioned in a motor
vehicle accident, can be determined as evident from the
judicial precedents; at least provisionally.
Page 8 of 10
SLP (C) No.11340 of 2020
11. In fact, it is due to the repudiation of or refusal to
consider the claim that the claimants are driven to the
Tribunal. When the matter is pending before the Tribunal or
in appeal before the higher forums, the claimants are
deprived of the compensation for future prospects. If they are
paid in time, it could be utilized by the claimants and on
failure, the loss of dependency would force the claimants to
source their livelihood from elsewhere. This is sought to be
compensated at least minimally by award of interest, which
oftener them ever is nominal also since only simple interest
is awarded. If the amounts were disbursed to the claimants
on a rough calculation, on intimation of the accident to the
Insurance Company, subject to the award of the Tribunal,
necessarily there would not have been any interest liability
atleast to the extent of the disbursement made. Hence, we
reject the contention and direct that the entire award amounts
would be paid with interest at the rate of 9% from the date of
filing of the claim till the date of disbursement, deducting
only Rs.50,000/- granted as interim compensation, in SLP(C)
No.11340 of 2020 and 6% in SLP(C) No.22136 of 2024 as
Page 9 of 10
SLP (C) No.11340 of 2020
awarded by the High Court; deduction to be made for the
amounts already paid.
12. We uphold the order of the High Court in both cases
and find no reason to interfere with the same. The amounts
awarded, if not paid, shall be paid within a period of 3 months
and if defaulted shall carry 12% interest on the total amount
of award with interest from the date of default.
13. The Special Leave Petitions stand rejected.
14. Pending applications, if any, shall stand disposed of.
...……….……………………. J.
(SUDHANSHU DHULIA)
………….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI;
JULY 14, 2025.
Page 10 of 10
SLP (C) No.11340 of 2020
Reportable
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
SPECIAL LEAVE PETITION (C) NO.11340 OF 2020
THE ORIENTAL INSURANCE CO. LTD.
…PETITIONER
VERSUS
NIRU @ NIHARIKA & ORS.
…RESPONDENTS
W I T H
SPECIAL LEAVE PETITION (C) NO.22136 OF 2024
J U D G E M E N T
K. VINOD CHANDRAN, J.
1. The wife and two minor children of the deceased in a
motor vehicle accident were before the Motor Accident
Claims Tribunal for compensation on loss of dependency.
The accident occurred on 18.11.1995 when the deceased was
travelling in a car which collided with a truck. On the
allegation of rash and negligent driving of the truck, the
Signature Not Verified
Digitally signed by
DEEPAK SINGH
Date: 2025.07.14
15:48:05 IST
Reason:
claimants were before the Tribunal seeking compensation of
Page 1 of 10
SLP (C) No.11340 of 2020
Rs.1,00,00,000/- which was later amended and enhanced to
Rs.1,30,00,000/-. The deceased alongwith his family, the
claimants were residing in the United Kingdom. The
deceased was a person with several academic achievements
working as an Engineer with the British Telecom and was
paid salary in Pounds.
2. The Tribunal found negligence of the driver of the truck
relying on the F.I.R. as also the award passed in a claim
petition filed by the driver of the car, wherein negligence was
clearly found on the truck driver. The income stood proved
rd
and the Tribunal adopted a multiplier of 13 and reduced 1/3
of the income for personal expenses. Loss of dependency
was computed at Rs.78,33,540/- to which award, Rs.40,000/-
as loss of consortium and Rs.15,000/- each for loss of estate
and funeral expenses were added. The total compensation
awarded was Rs.79,04,540/-.
3. The Insurance Company filed an appeal before the
High Court against the award amounts raising multifarious
Page 2 of 10
SLP (C) No.11340 of 2020
contentions. It was first contended that the accident occurred
only due to the rashness and negligence of the car driver. On
the quantum, it was submitted that admittedly the wife
married in the year 2002 and the multiplier should have been
only 7, taken from the death of the first husband. The
exchange rate as adopted by the Tribunal, was also assailed
together with the interest granted at the rate of 9%, which it
was contended was against the existing interest rates.
Specific contention was taken against the long delay in
disposing of the claim petition, which was filed in the year
1995 and disposed of in the year 2017. The allegation was that
the claimants who were residing in the U.K. were solely
responsible for the delay occasioned. We see the said
contention having been taken relying on Annexure A-4
produced in the memorandum of SLP filed.
4. The High Court affirmed the negligence of the truck
driver and interfered with the quantum only to the extent of
reducing the average exchange rate as existing in the years
1995 & 1996. The exchange rate of Indian Rupee per Pound
Page 3 of 10
SLP (C) No.11340 of 2020
was determined at Rs.52.3526 as against the determination of
Rs.54.2601 by the Tribunal. The Insurance Company has filed
the appeal to cause further interference to the quantum on the
various other grounds taken before the Tribunal which
according to the Insurance Company was not considered at
all by the Tribunal.
5. The Insurance Company has specifically stated in the
appeal memorandum that based on the exchange rate
applicable at the time of the accident, the monthly income of
the deceased should only have been Rs.56,168 (1072.94 x
52.35); which was accepted by the High Court. The Tribunal
rd
and the High Court were correct in having deducted 1/3 for
personal expenses and the addition made of 30% for future
prospects.
6. One other compelling contention taken by the
Insurance Company before the High Court and this Court is
that the first respondent-wife of the deceased admitted that
she got remarried in 2002 and after that she alongwith her
Page 4 of 10
SLP (C) No.11340 of 2020
children was living with her second husband. She also
admitted that the pension she received from the deceased
husband’s employer was stopped after that. Obviously, the
loss of dependency of the claimants could be assessed only
for 7 years; i.e. from 1995-2002, argues the insurer.
Presumably the family pension was only payable to the wife
and when she got remarried, the same was stopped.
However, it cannot be said that the minor children were not
entitled to the multiplier as adopted by the Tribunal. In such
circumstances, we find absolutely no reason to interfere with
the multiplier adopted by the Tribunal & affirmed by the High
Court. The compensation for loss of dependency would thus
rd
be; Rs.56,165 x 130% x 12 x 13 x 2/3 = Rs.75,93,508/-. To
the said amount would be added Rs.70,000/-, being the
amounts granted by the Tribunal for loss of consortium, loss
of estate and funeral expenses. The total award hence would
be Rs.76,63,508/-, as determined by the High Court too.
7. Yet another contention taken up is the interest granted
at the rate of 9%. The Insurance Company relies on Annexure
Page 5 of 10
SLP (C) No.11340 of 2020
P-1 history of the case to contend that there was undue delay
caused by reason of the claimants having not entered their
evidence. From Annexure P-1, we see that the claim petition
was filed on 28.12.1995 and it first came up for hearing on
11.09.2012. It is seen from Annexure P-1 that the case was
posted for applicants’ evidence on various dates from 2012 to
2016. However, there is nothing to indicate that it was only by
reason of the claimants’ absence that the consideration was
delayed. Merely because, on various dates, for 4 years, the
case was posted for the claimants’ evidence, it does not
necessarily mean that the claimants were responsible for the
delay. Laws delays cannot, without proper substantiation, be
cast upon the shoulders of one or other party to the lis. We
hence do not find any reason to find the delay to be the sole
responsibility of the claimants and in that circumstance
necessarily interest must run from the date of filing of the
claim petition, to the date of payment; for which precedents
are legion, and we need not refer to them.
Page 6 of 10
SLP (C) No.11340 of 2020
8. Further contention taken is the higher rate of interest of
9%, in challenge of which several precedents were placed
before us. From the decisions perused what emanates is that
in the 1980’s, Courts were awarding 12% interest which stood
st
reduced to 9% in the 1990’s. With the advent of the 21
century and the economic recession world over, the interest
rates fell considerably. But even now the rates offered by
National Banks for long term deposits are 7% or more.
Considering the over-all circumstances especially the long
delay caused, we are of the opinion that 9% interest rate
granted by the Tribunal is perfectly in order especially
noticing the accident having occurred in the year 1995.
9. A very relevant issue agitated by the Insurance
Company is the illegality in awarding interest for future
prospects, which in any event is an amount received in
advance, normally inuring to the benefit of the claimants only
in future. This is the only contention taken in the connected
appeal bearing SLP(C) No.22136 of 2024. We find absolutely
no reason to accept this argument. In SLP(C) No.11340 of
Page 7 of 10
SLP (C) No.11340 of 2020
2020, the multiplier applied looking at the life span of the
deceased and the claimants is 13. Before the Tribunal itself,
the case was pending for 12 years and the only amount
received by the claimants was Rs.50,000/-. Hence though
amounts are awarded for future prospects taking the
multiplier of 13; in effect, the money is received only after the
period for which the multiplier is adopted. Similar is the case
in SLP(C) No.22136 of 2024 where the accident occurred in
2018, the multiplier applied is 17 and we are seven years
from the date of accident.
10. We cannot but observe that there was nothing stopping
the Insurance Company from settling the claim on a
computation, on receipt of intimation of the accident,
especially since the determination of compensation for loss
of dependency, on death being occasioned in a motor
vehicle accident, can be determined as evident from the
judicial precedents; at least provisionally.
Page 8 of 10
SLP (C) No.11340 of 2020
11. In fact, it is due to the repudiation of or refusal to
consider the claim that the claimants are driven to the
Tribunal. When the matter is pending before the Tribunal or
in appeal before the higher forums, the claimants are
deprived of the compensation for future prospects. If they are
paid in time, it could be utilized by the claimants and on
failure, the loss of dependency would force the claimants to
source their livelihood from elsewhere. This is sought to be
compensated at least minimally by award of interest, which
oftener them ever is nominal also since only simple interest
is awarded. If the amounts were disbursed to the claimants
on a rough calculation, on intimation of the accident to the
Insurance Company, subject to the award of the Tribunal,
necessarily there would not have been any interest liability
atleast to the extent of the disbursement made. Hence, we
reject the contention and direct that the entire award amounts
would be paid with interest at the rate of 9% from the date of
filing of the claim till the date of disbursement, deducting
only Rs.50,000/- granted as interim compensation, in SLP(C)
No.11340 of 2020 and 6% in SLP(C) No.22136 of 2024 as
Page 9 of 10
SLP (C) No.11340 of 2020
awarded by the High Court; deduction to be made for the
amounts already paid.
12. We uphold the order of the High Court in both cases
and find no reason to interfere with the same. The amounts
awarded, if not paid, shall be paid within a period of 3 months
and if defaulted shall carry 12% interest on the total amount
of award with interest from the date of default.
13. The Special Leave Petitions stand rejected.
14. Pending applications, if any, shall stand disposed of.
...……….……………………. J.
(SUDHANSHU DHULIA)
………….……………………. J.
(K. VINOD CHANDRAN)
NEW DELHI;
JULY 14, 2025.
Page 10 of 10
SLP (C) No.11340 of 2020