Dependency in Motor Accident claims for foreign residents must be computed using Indian legal standards and principles.

On July 3, 1994, Mrs. Kavita Sawlani died in a motor accident involving a head-on collision between her vehicle and a lorry.

The claimants (husband and children) sought compensation, asserting that the deceased, a Bachelor of Arts, earned significant income as a project consultant/interior designer for one Mr. Abdulla in Dubai.

The Motor Accident Claims Tribunal (MACT) awarded Rs. 5,52,15,000/- with 9% interest from the date of the award.

The Insurance Company appealed, challenging the deceased’s vocation and income due to a lack of professional qualifications and separate bank accounts.

The claimants filed cross-objections seeking a higher multiplier, future prospects, and interest from the date of the application.

1. Whether the MACT properly appreciated evidence to determine the deceased’s annual income at 1 Million Dirhams (approx. Rs. 70 Lakhs).

2. Whether the claimants are entitled to "future prospects" and an increased multiplier in line with established precedents.

3. Whether interest should be awarded from the date of the claim petition rather than the date of the award.

The Court applied Section 168 of the Motor Vehicles Act regarding "just compensation" and Section 94 of the Indian Evidence Act, which precludes evidence contradicting plain language in a document.

It relied on the Constitution Bench decision in National Insurance Co. Ltd. v. Pranay Sethi, establishing a 25% addition for future prospects for those aged 40–50 and standardizing conventional heads.

The Court also followed Sarla Verma v. Delhi Transport Corp. for the multiplier (15 for age 40) and personal expense deductions (1/3rd for three dependents).

Regarding foreign income, it applied Kulwinder Kaur v. Parshant Sharma, holding that Pranay Sethi principles apply to foreign residents unless specific local evidence suggests otherwise.

The Court rejected the Appellant’s challenge to the deceased's income, noting that the employer (Abdulla) and the husband (Sawlani) testified to her work and earnings, which were supported by an income certificate and bank statements.

Under Section 94 of the Evidence Act, the Appellant failed to disprove the validly executed Power of Attorney and MoUs showing she conducted business through her husband.

The Court found the MACT’s determination of Rs. 70 Lakhs annual income sustainable as the husband had no independent income during that period, confirming the deposits were hers.

However, the Court found the MACT erred in legal application: the multiplier was increased from 12 to 15 based on her age (40) per Sarla Verma.

It granted 25% future prospects, rejecting the Insurance Company's claim that such benefits don't apply to foreign earners.

Finally, the Court corrected the interest commencement date to the date of the application (1994) to ensure "just compensation".

It held that the deceased’s annual income was Rs. 70,00,000/-.

The Court ordered a re-computation using: (i) a 15x multiplier; (ii) 25% future prospects; (iii) 1/3rd deduction for personal expenses; and (iv) enhanced conventional heads (Loss of Estate/Funeral Expenses at Rs. 15,000 and Consortium at Rs. 40,000, each increased by 10% every three years).

The Appellant was directed to pay the re-computed amount with 9% interest per annum calculated from the date of the claim petition (December 23, 1994).