A bachelor’s personal-expense deduction may be reduced to one-third where exceptional family dependency is established.

On 1 October 2016, Mahadeva Prasad, aged about 20, died from injuries sustained when the motorcycle on which he was travelling as a pillion rider collided with another motorcycle.

His parents and minor brother brought a claim under Section 166 of the Motor Vehicles Act, 1988.

The Tribunal awarded Rs.14,60,800 with interest at 8% per annum, assessing monthly income at Rs.9,000, adding 40% for future prospects, deducting 50% for personal expenses, and awarding amounts under conventional heads.

The claimants appealed under Section 173(1), seeking enhancement; the insurer conceded that the 2016 notional income and conventional-head amounts required revision, but opposed reducing the bachelor’s personal-expense deduction to one-third.

Under Sarla Verma (Smt.) v. Delhi Transport Corporation, the usual deduction for a bachelor is 50% of income, but that approach is not inflexible; where the evidence shows a large family dependent on the deceased, personal expenses may be restricted to one-third.

Under National Insurance Co. Ltd. v. Pranay Sethi, 40% is added for future prospects for a self-employed deceased below 40, and the prescribed conventional-head amounts are subject to 10% enhancement every three years.

The Court applied the KSLSA notional-income chart for 2016, fixing monthly income at Rs.9,500, and retained the multiplier of 18 under Sarla Verma.

The appeal was considered under Section 173(1) of the Motor Vehicles Act, 1988.

The Court accepted Rs.9,500 as the appropriate notional monthly income because the claimants had produced no documentary proof of the asserted Rs.15,000 income.

Although the deceased was a bachelor, the Court found exceptional dependency: his father had health issues, and the deceased had been meeting the educational expenses of his minor brother.

It therefore applied the Sarla Verma exception and deducted one-third, rather than 50%, for personal expenses.

Applying 40% future prospects and a multiplier of 18, it recalculated loss of dependency at Rs.19,15,272.

It increased consortium to Rs.40,000 for each of the three claimants and applied 20% escalation to the conventional heads, resulting in total compensation of Rs.20,95,272.

Although it referred to authority supporting 9% interest, it declined to alter the Tribunal’s 8% rate in this case.

The award was modified by enhancing compensation by Rs.6,34,472, with interest at 8% per annum from the date of the petition until realisation; the remaining parts of the Tribunal’s award were left undisturbed.

The insurer was directed to deposit the enhanced compensation within eight weeks, for release to the claimants in accordance with the Tribunal’s directions.