Deceased’s income was reassessed at the skilled-labour minimum wage, warranting enhanced motor accident compensation.

Late Jeevrakhan Manhare, aged approximately 33 years, died following a motor vehicle accident on 25 November 2023.

His widow, three minor children, and parents filed a claim under the Motor Vehicles Act, 1988.

The Motor Accident Claims Tribunal, in Claim Case No. 38/2024, awarded total compensation of ₹24,26,660 by assessing the deceased’s monthly income at ₹10,100 as an unskilled labourer, adding 40% future prospects, deducting one-fourth towards personal expenses, and applying a multiplier of 16.

The claimants appealed under Section 173 of the Motor Vehicles Act, 1988, seeking enhancement, particularly on the ground that the deceased’s income was ₹21,000 per month or, alternatively, that he should have been treated as a skilled labourer.

The insurer opposed the appeal, relying on the admissions made by the income witness in cross-examination.

Whether the Tribunal erred in assessing the deceased’s monthly income at ₹10,100 as an unskilled labourer, and whether the income ought to be assessed at the applicable rate for a skilled labourer?

Whether the compensation awarded under the conventional heads, including loss of consortium, loss of estate, and funeral expenses, required enhancement?

Whether the claimants were entitled to an enhanced total compensation and interest on the additional amount?

The Court applied Section 173 of the Motor Vehicles Act, 1988, governing appeals against awards of the Claims Tribunal.

Compensation must be just and must be determined on the basis of the deceased’s established or reasonably assessable income, applicable future prospects, deductions for personal expenses, and the appropriate multiplier.

The Court relied on Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, for the principles governing deduction towards personal expenses and selection of the multiplier; National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, for addition of future prospects and the amounts payable under conventional heads; and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 1306, for awarding consortium to eligible family members.

The applicable Chhattisgarh Minimum Wages Notification was used to assess the deceased’s income at the skilled-labour rate of ₹11,530 per month.

The Court found that, although the Tribunal had rejected the claim of ₹21,000 monthly income based on the evidentiary deficiencies and admissions elicited from the income witness, it had assessed the deceased too conservatively as an unskilled labourer.

Considering the nature of his work and the material on record, the Court treated him as a skilled labourer and fixed his monthly income at ₹11,530.

It affirmed the Tribunal’s application of 40% future prospects, one-fourth deduction for personal expenses, and multiplier of 16, having regard to the deceased’s age of 33 years and six dependants.

Applying the principles in Pranay Sethi, Sarla Verma, and Magma General Insurance, the Court recalculated the loss of dependency at ₹23,24,448, awarded ₹2,88,000 towards consortium to six claimants, ₹18,000 towards loss of estate, ₹18,000 towards funeral expenses, and retained ₹1,20,500 towards medical expenses.

The resulting compensation was ₹27,68,948.

The High Court enhanced the compensation from ₹24,26,660 to ₹27,68,948, thereby awarding an additional ₹3,42,288 to the claimants.

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

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

The Registry was directed to communicate the enhanced amount to the claimants in Hindi, with assistance from paralegal workers where necessary.