Hyderabad: The Supreme Court Tuesday awarded one of the highest compensations in a road accident case in India, ordering the Andhra Pradesh State Road Transport Corporation (APSRTC) to pay Rs 9.64 crore to the family of an NRI who died in a bus-car collision in 2009.
The bench of Justices Sanjay Karol and Prashant Kumar Mishra ordered the astounding compensation in lieu of the high net worth and income generation capacity of the deceased, Lakshmi Nagalla, a Telugu person who was permanently residing in the US. The APSRTC has to pay the amount to Lakshmi’s husband Shyam Prasad Nagalla and others.
The compensation awarded by the SC is around Rs 4 crore more than what was decided in the case by the High Court of Telangana at Hyderabad: Rs 5.75 crore.
Aggrieved by the HC order delivered last year, Shyam Prasad had approached the apex court with a civil appeal. The appeal was disposed of in two months.
In 2014, the Motor Accidents Claims Tribunal at Secunderabad had awarded compensation of Rs 8.03 crore in the case, along with 7.5 percent interest per annum.
The claimant-appellants in the SC petition are the husband and two daughters of Lakshmi.
ThePrint sought the response of Dwaraka Tirumala Rao, MD, APSRTC, on the SC order. “I need to go through the order copy and review the case details,” Rao said.
Following his superannuation from the police service last month, Rao, who stepped down as Director-General of Police, is being continued as the state transport service’s head by the Chandrababu Naidu government in Andhra Pradesh.
A look at the case
On 13 June, 2009, Lakshmi Nagalla, aged 43, was travelling with her family in a Honda City car bearing registration number AP 37 AL 7227 from Annavaram, a famous pilgrimage site, to Rajahmundry, both towns in East Godavari district of then undivided Andhra Pradesh.
“Upon reaching the circle leading to Prathipadu, the offending vehicle, no AP 11 Z 860, owned and operated by the state-run APSRTC, approached from the opposite direction driving in a rash and negligent manner,” the SC order notes.
It collided with Nagalla’s car, resulting in instantaneous death of Lakshmi and inflicted multiple injuries upon the other occupants of the car.
Later, in 2012, Nagalla’s family, i.e., her dependents, filed a claim petition before the Motor Accidents Claims Tribunal at Secunderabad seeking compensation of Rs 9 crore.
Their submission was that the deceased Lakshmi Nagalla, with a Master’s degree in computer science from Southern College of Technology University of Georgia (US) and a permanent resident of the US, was earning a monthly income of $11,600 working as a software engineer in K-FORCE Services Corporation in the US and as a real estate commission salesperson in Georgia state.
The tribunal in 2014 held that the APSRTC was liable to pay Rs 8,03,42,476 ($16,88,960) along with interest at 7.5 percent per annum. The tribunal considered the monthly income of Lakshmi at $11,600 after tax deduction and fixing the future prospects at 30 percent. It also granted an additional amount of Rs 2,35,000 towards conventional heads, totalling the entire compensation to be Rs 8.03 crore.
An aggrieved APSRTC filed an appeal before the Telangana High Court on the grounds that the tribunal incorrectly held the offending vehicle to be driving rashly, and that a multiplier of 14 had been incorrectly applied while calculating compensation.
The HC last year affirmed the tribunal’s findings on Lakshmi’s monthly income being $11,600. However, the multiplier to be applied was reduced from 14 to 10 on account of the deceased earning in foreign currency. So, a sum of Rs 5.75 crore was awarded by the HC.
Dissatisfied, the Nagallas knocked on the SC doors.
On 3 January the SC bench said the case needed two main considerations: whether the petitioner was entitled to compensation at the exchange rate of currency as on the date of the accident or on the date of filing of the petition, and whether the HC was justified in reducing the multiplier to 10 from 14 as taken by the tribunal.
Citing Jiju Kuruvila & Ors vs Kunjujamma Mohan and DLF vs Koncar Generators & Motors cases, the court noted that the claim filing date was the proper date for fixing the rate of exchange for computing compensation. So, the conversion rate was fixed at Rs 57, the prevalent dollar exchange rate at the time of filing of petition in the tribunal.
On the second issue, the SC bench noted that according to National Insurance Company vs Pranay Sethi case, the law is settled that the multiplier for a person aged 43 must be 14.
“No exception is made for a person earning in foreign currency,” it observed.
Stating so, Justices Karol and Mishra ordered that the compensation now payable to the Nagallas would be recalculated to come to a total of Rs 9,64,52,220. Interest is to be paid as awarded by the tribunal, at 7.5 percent per annum.
(Edited by Nida Fatima Siddiqui)
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