Bachelor’s personal expense deduction must be 50% regardless of number of family dependents.

On 15.01.2023 at about 5:30 hours, the deceased Kandipan, while standing at Medavakkam Main Road near Kovilambakkam Bus Stop, Chennai, was fatally struck by a hydraulic mobile crane (Reg. No. TN 18 AW 7992) driven in a rash and negligent manner; he died on the spot.

The claimants — the deceased's parents, married sister, and independent adult brother — filed MCOP No. 2197/2023 before the MACT, VI Court of Small Causes, Chennai, claiming compensation of Rs. 35,00,000/-.

The Tribunal awarded Rs. 39,89,000/- (Loss of Dependency: Rs. 37,80,000/-; Loss of Consortium: Rs. 1,76,000/-; Loss of Estate: Rs. 16,500/-; Funeral Expenses: Rs. 16,500/-).

Aggrieved, the Insurance Company preferred this appeal under Section 173 of the Motor Vehicles Act, 1988, confining the challenge solely to quantum.

1. Whether, in the case of an unmarried bachelor whose dependents were living parents, a married sister, and an independent adult brother, the deduction towards personal and living expenses ought to have been 50% (½) as mandated by Sarla Verma v. DTC, rather than the 1/4th (25%) deduction applied by the Tribunal.

2. Whether comprehensive and uniform directions should be issued to Motor Accident Claims Tribunals for the effective implementation of disbursement of compensation via Direct Bank Transfer (DBT) to claimants, with proper safeguards for court fee and advocate's fee components.

Section 173 of the Motor Vehicles Act, 1988.

Sarla Verma v. Delhi Transport Corporation, 2009 (2) TNMAC 1, which prescribes a 50% deduction towards personal and living expenses where the deceased was a bachelor.

National Insurance Co. v. Pranay Sethi, 2017 (2) TNMAC 609 (loss of estate, funeral expenses).

Parminder Singh v. Honey Goyal, (2025) 9 SCC 539, holding that insurers may transfer compensation directly to claimants' verified bank accounts with intimation to the Tribunal, treating such transfer as satisfaction of the award.

Re: Compensation Amounts Deposited with MACTs and Labour Courts, 2025 INSC 530, prescribing procedural particulars (Aadhaar/PAN, bank details, updating obligations).

Applying Sarla Verma to the fact that the deceased was an unmarried bachelor whose claimants were his parents, a married sister, and an independent adult brother, the Court held that the Tribunal erred in deducting only 1/4th towards personal and living expenses.

Recomputing on the unchanged annual income of Rs. 3,36,000/- with a 50% deduction (Rs. 1,68,000 dependent contribution) and the unchanged multiplier of 15, loss of dependency was fixed at Rs. 25,20,000/-.

The Court reasoned that the Motor Vehicles Act is welfare legislation and that "just compensation" under Section 168 is fulfilled only when the amount reaches claimants without delay or diversion.

The Court found existing mechanisms insufficiently harmonised — particularly regarding segregation of court fee and advocate's fee from net compensation — and therefore framed twelve uniform directions adopting, inter alia, the Kerala practice of depositing the costs component into the Tribunal's account separately from the claimant-destined net compensation.

On Issue 2, the Court issued twelve binding directions, including: mandatory DBT (NEFT/RTGS) of awards directly into claimants' verified accounts; separate deposit of advocate's fee and expenses into the Tribunal's account, distinct from net compensation; and issuance of an administrative circular by the Registrar General to all MACTs in Tamil Nadu and Puducherry for strict compliance.