UNITED INDIA INSURANCE CO.LTD. Vs. MOSTT.KABLESHWA

JUDGEMENT

(1.) HEARD the parties. In a motor accident dated 28.5.1991, one Rajendra Ram, aged about 22 years lost his life. He was a passenger travelling in a Bus (BHY - 7555). It was established that acciden1 look place on account of negligence of driver of the Bus. At the relevant time the Bus was insured with United India Insurance Co. Ltd. Besides parents, his widow was also one of the claimants. The deceased was earning Rs. 2000/ - per month, out of which 1/3rd amount was deducted towards his personal expenses and annual dependency was calculated at Rs. 24000/and 17 multiplier was applied thereto. In this manner a sum of Rs. 2,70,000/ - was calculated as compensation amount and a sum of Rs. 5000/ - for loss of consortium and 2000/ - for funeral expenses were added thereto. Accordingly claimants were held entitled to get total amount of Rs. 2,77,000/ -. We find no reason to interfere with the said judgment/award.

(2.) THE Tribunal has also granted interest @12% per annum on the amount of award payable from the date of filing of claim application, i.e. 8.10.1991. In this regard reference may be made to a recent decision of the Apex Court in Smt. Kaushnuma Begum and others vs. The New India Assurance Co. Ltd. and others, 2001 (1) JLJR (SC) 322, wherein it was held that earlier 12% was found to be the reasonable rate of simple interest, but with a change in economy and the policy of the Reserve Bank of India the interest rate has been lowered. The nationalised banks are now granting interest at the rate of 9% on fixed deposits for one year. In such situation the Apex Court directed that the compensation amount fixed hereinbefore shall bear interest at the rate of 9% per annum from the date of claimmade. Applying ratio of the said decision, we modify the rate of interest granted by the Tribunal from 12% to 9%. The amount of Rs. 25000/ - paid by Insurance Company under Section 140 shall be deducted from the principal amount as on the date of its payment, and interest would be recalculated on the balance amount of the principal sum from such date.