2025 INSC 822 Page 1 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.

…RESPONDENT S

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

claimants were before the Tribunal seeking compensation of

Page 2 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

and the Tribunal adopted a multiplier of 13 and reduced 1/3

rd

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 3 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 4 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

and the High Court were correct in having deducted 1/3

rd

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 5 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

be; Rs.56,165 x 130% x 12 x 13 x 2/3

rd

= 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 6 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 7 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

reduced to 9% in the 1990’s. With the advent of the 21

st

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 8 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 9 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 10 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.