Dual income assessment requires strict adherence to employment contract prohibitions against secondary business activities.

The Appellant Insurance Company challenged a Motor Accidents Claims Tribunal (MACT) award dated August 5, 2019.

The original claim arose from a 2016 vehicular accident where a motorcycle driver was fatally struck from behind by a bus.

The Tribunal had awarded ₹63,66,128 based on the deceased’s combined income from a private travel business and a salary as a field executive.

The Appellant contended that the Tribunal erred by clubbing these incomes, noting that the employment contract expressly prohibited concurrent business activities and that there was insufficient proof of the business's continued operation.

1. Whether the Tribunal correctly calculated the loss of dependency by clubbing income from both a private business and salaried employment.

2. Whether the deceased’s employment contract, which prohibited outside business activities, precluded the inclusion of business income in the compensation assessment.

3. Whether the compensation awarded for loss of consortium was consistent with established legal precedents.

The Court applied Section 166 of the Motor Vehicles Act regarding compensation.

Rashmirekha Tripathy Anr. v. Sriram General Insurance Co. Ltd. (2026:INSC:661), which establishes distinct methods for assessing income for salaried versus self-employed individuals and emphasizes the importance of Income Tax Returns (ITRs).

Magma General Insurance Co. Ltd. v. Nanu Ram (2018) regarding the proper quantification of loss of consortium for multiple claimants.

The Court distinguished the present case from Sunita Ors v. Vinod Singh Ors (2025 INSC 366), noting that the later pertained specifically to the dual income of a housewife.

The Court found the Tribunal's decision to club both salary and business income to be incorrect given the specific restrictive covenants in the deceased’s work assignment letter.

Under Clause 6 of that letter, the deceased was prohibited from undertaking other business activities without written permission, which was not proven in court.

Consequently, the Court determined it was more appropriate to calculate income based on the business's past performance reflected in ITRs rather than assuming dual earnings.

Using the ITR from AY 2015-16 as a stable reference point, the Court recalculated the net annual income at ₹3,45,855.

Additionally, the Court increased the consortium award to ensure each of the four claimants received a standard amount, correcting the Tribunal's lower lump-sum figure.

It held that the deceased's income could not be clubbed due to contractual restrictions.

The Court directed that if the Insurance Company had deposited more than the revised amount, the surplus should be released back to them, while any shortfall must be deposited within four weeks. Interest remained at 9% per annum.