Cook’s Widow And Two Sons Get Rs 5.25 Lakh More After Karnataka HC Raises Deceased’s Income Estimate And Applies One-Third Dependency Deduction

The claimants, the deceased Ananda Shetty’s wife and two sons, sought compensation for his death in a road accident on 14 January 2018.

The Tribunal awarded Rs. 6,44,600, assessing his monthly income at Rs. 9,000 and deducting 50% for personal expenses.

The claimants appealed under Section 173(1) of the Motor Vehicles Act, contending that the income assessment and deduction were incorrect and that the conventional heads required enhancement.

Under Section 173(1) of the Motor Vehicles Act, an aggrieved party may appeal against a Tribunal’s award.

The Court applied the principles in National Insurance Company Ltd. v. Pranay Sethi, (2017) 16 SCC 680, concerning future prospects and periodic enhancement of conventional heads: it added 10% future prospects to the deceased’s income and applied a 20% escalation to the relevant conventional amounts.

In assessing dependency, the Court considered the number of dependants and deducted one-third of the deceased’s income for personal and living expenses where there were three dependants.

The salary certificate showed monthly earnings of Rs. 19,500, but its author had not been examined; nevertheless, the Tribunal’s assessment of Rs. 9,000 was considered too low for a 2018 accident. The Court therefore assessed monthly income at Rs. 12,500, added 10% for future prospects, deducted one-third for personal expenses, and applied a multiplier of 9, resulting in loss of dependency of Rs. 9,90,036.

Applying the Pranay Sethi escalation, it assessed loss of estate and funeral expenses at Rs. 18,000 each, and consortium at Rs. 1,44,000 for three dependants.

The insurer was directed to deposit the enhanced amount with interest at 6% per annum from the date of the petition until realization, within six weeks; apportionment and release were left as directed by the Tribunal.