Absent admissible income evidence, courts may assess motor-accident earnings using applicable minimum wages.

B. Appa Rao died in a motor accident on 2 November 2020 allegedly caused by the rash and negligent driving of respondent No. 1, who was driving truck bearing registration No. RJ/48/GA/0978.

The appellants—his widow and son—filed a claim petition under Section 166 of the Motor Vehicles Act, 1988, seeking compensation of ₹25 lakhs.

The Motor Accident Claims Tribunal held the respondents liable and awarded total compensation of ₹8,76,040 by its award dated 8 December 2022 in Claim Case No. 488 of 2020.

In the appeal under Section 173 of the Motor Vehicles Act, the claimants sought enhancement, contending that the deceased’s monthly income should have been assessed at ₹10,500 rather than ₹7,800 and that the amounts under conventional heads were inadequate.

The insurer opposed enhancement, submitting that, in the absence of admissible proof of income, the Tribunal had correctly relied on minimum wages.

Whether the deceased’s monthly income was required to be reassessed for computing loss of dependency in the absence of direct and conclusive evidence of actual income?

Whether the compensation awarded by the Tribunal required enhancement by applying the appropriate principles relating to future prospects, personal-expense deduction, multiplier, and conventional heads?

The Court exercised appellate jurisdiction under Section 173 of the Motor Vehicles Act, 1988, in relation to a claim under Section 166 of the Act.

For assessment of compensation, it applied the principles in Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, concerning deduction towards personal expenses and selection of the multiplier; National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, concerning addition of future prospects and conventional heads; and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 130, concerning consortium payable to eligible claimants.

In the absence of admissible and conclusive evidence of actual income, the Court assessed income by reference to the applicable Chhattisgarh minimum wages and prevailing market rates.

The Court found that the claimants had not produced admissible and clinching evidence establishing the deceased’s asserted income of ₹10,500 per month.

Nevertheless, considering the prevailing market rates and the applicable Chhattisgarh minimum wages, it reassessed his monthly income at ₹8,960 as an unskilled labourer.

Applying a 10% addition for future prospects, deducting one-third towards personal expenses because there were two dependants, and applying the multiplier of 11 for the deceased’s age of 53 years, the Court calculated annual loss of dependency at ₹8,67,328: ₹8,960 × 12 = ₹1,07,520; plus 10% future prospects = ₹1,18,272; less one-third personal expenses = ₹78,848; multiplied by 11.

The Court found no reason to interfere with the Tribunal’s award of ₹1,21,000 under the conventional heads, comprising ₹88,000 for consortium to two claimants, ₹16,500 for loss of estate, and ₹16,500 for funeral expenses.

The appeal was partly allowed.

The Court enhanced the compensation from ₹8,76,040 to ₹9,88,328, thereby granting an additional amount of ₹1,12,288 to the appellants.

The enhanced amount was directed to carry interest at 6% per annum from the date of filing of the claim application until realization.

All other terms and conditions of the Tribunal’s award were left undisturbed.