The Kerala High Court has ruled that compensation for a deceased person who was employed abroad should be calculated based on the exchange rate prevailing on the date of filing the claim petition, rather than the exchange rate on the date of the accident.
The judgment was delivered in an appeal challenging the Motor Accidents Claim Tribunal's (MACT) decision, which had awarded compensation of Rs. 2,92,19,000 to the legal heirs of the deceased. The deceased, a 34-year-old nurse employed in Australia, had tragically lost her life in a motorcycle accident due to the negligent driving of a lorry.
High Court’s Observation
The appeal was heard by Justice Johnson John, who relied on the Supreme Court's decision in Shyam Prasad Nagalla v. Andhra Pradesh State Board Transport Corporation (2025). In that case, the Apex Court had ruled that the exchange rate applicable for compensation calculation should be the one prevailing on the date of filing the claim petition.
The Court stated:
"The Tribunal calculated the exchange rate of the Australian dollar as on the date of the accident. However, the Hon’ble Supreme Court in Shyam Prasad Nagalla v. Andhra Pradesh State Board Transport Corporation (2025 KHC Online 7117) has clearly established that compensation must be calculated at the exchange rate on the date of filing the petition."
The counsel for the claimants submitted an affidavit confirming that the exchange rate on the date of filing the petition (October 19, 2013) was Rs. 59.23 per Australian dollar, which was not contested by the opposing party.
Two appeals were filed—one by the insurance company and the other by the legal heirs of the deceased, including her mother, husband, and two minor children. While the insurance company challenged the Tribunal’s calculation of the deceased’s monthly income, the legal heirs sought an increase in the compensation amount.
The High Court noted that the Tribunal had determined the deceased’s income using the exchange rate on the accident date, which was incorrect. The Court reiterated that the appropriate rate should be the one prevailing at the time of petition filing.
Another crucial aspect of the judgment was the selection of the appropriate multiplier for compensation calculation. The Court pointed out that the Tribunal had used a multiplier of 10, which was incorrect for a person aged 34.
The Court referenced the Supreme Court’s ruling in Sarla Varma v. Delhi Transport Corporation (2010) and stated:
"It is well settled that the multiplier is to be selected based on the deceased’s age at the time of the accident. The Tribunal erred in not following the Hon’ble Supreme Court’s principles. The correct multiplier applicable for individuals aged between 31-56 years is 16."
Considering these factors, the High Court dismissed the insurance company’s appeal and allowed the claimants' appeal. As a result, the Court enhanced the compensation to Rs. 73,66,408.
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Counsel for Insurance Company: Senior Advocate George Cherian, Advocates K S Santhi, Latha Susan Cherian
Counsel for Claimants: Advocate A N Santhosh
Case Title: National Insurance Co.Ltd. v John Thomas & Connected Matter
Case No: MACA NO. 1287 OF 2019 & Connected Matter
