Adoption of minimum wages and future prospects mandatory for reassessing compensation in motor accident claims

On July 6, 2023, the appellant, a pillion rider on a motorcycle, sustained serious injuries when struck by a tractor driven at excessive speed by Respondent No. 1

The Motor Accident Claims Tribunal (MACT), Kheda at Nadiad, partly allowed the claim petition (MACP No. 687/2023), awarding Rs. 2,32,280/- with 7.5% interest

Dissatisfied with the quantum of compensation, specifically regarding the assessment of monthly income, future prospects, and non-pecuniary heads, the claimant preferred this appeal for enhancement

1. Whether the Tribunal erred in assessing the claimant's monthly income and failing to account for future prospects

2. Whether the compensation awarded under the heads of pain, shock, suffering, and special diet/transportation was adequate given the nature of injuries

The Court applied the principles for calculating "just compensation" under the Motor Vehicles Act, 1988.

It relied on National Insurance Company Ltd. v. Pranay Sethi (2017) 16 SCC 680 and Sidram v. The Divisional Manager, United India Insurance Co. Ltd. (2022) INSC 1202 to mandate a 25% addition to income for future prospects for claimants aged between 40 to 50 years

The Court also referenced prevailing minimum wage notifications by the Government of Gujarat for skilled workers to determine income in the absence of documentary evidence

The Court found the Tribunal’s assessment of Rs. 8,000/- per month arbitrary. Since the accident occurred in 2023, the Court adopted the statutory minimum wage for a skilled worker (Rs. 12,324/-) as the base income

Following Pranay Sethi, it added 25% for future prospects, totaling Rs. 15,405/- per month. Applying the undisputed 11% functional disability and a multiplier of 13, the Court recalculated future loss of income to Rs. 2,64,350/-

Furthermore, the Court determined that the initial awards for non-pecuniary losses were "meagre"; it increased "Pain, Shock, and Suffering" to Rs. 20,000/- and "Special Diet/Transportation" to Rs. 15,000/- to reflect the actual hardship and hospitalization period

The court held that the claimant is entitled to an enhanced total compensation of Rs. 3,92,998/-, resulting in an additional award of Rs. 1,60,718/- over the Tribunal's original order

The insurance company (Respondent No. 2) was directed to deposit the additional amount with 7.5% interest within six weeks. The award of the Tribunal was modified accordingly