For a 28-year-old claimant without permanent employment, future prospects are limited to 40%.

On 5 April 2012, Than Singh sustained grievous injuries when his motorcycle collided with a DTC bus allegedly driven rashly and negligently by Mukesh Kumar. His right leg was crushed by the bus’s front wheel, causing a fracture of the right femur and 42% permanent disability.

The MACT, Dwarka Courts, awarded compensation of ₹18,47,608 with interest. The insurance company appealed, seeking reduction of the award on the grounds of contributory negligence, insufficient proof of the claimant’s monthly income of ₹20,000, and incorrect computation of future prospects.

Whether the claimant was contributorily negligent in causing the accident because the collision was allegedly head-on?

Whether the claimant’s monthly income of ₹20,000 was sufficiently proved and whether any deduction was required towards conveyance and telephone allowances?

Whether future prospects were required to be assessed at 40% rather than 50%, considering the claimant’s age and non-permanent employment?

The Court applied the principle that contributory negligence must be established from the evidence concerning the parties’ respective positions and conduct at the time of the accident; a claimant cannot be held contributorily negligent merely because the collision was described as head-on.

For assessment of loss of earning capacity, proved income may be established through oral testimony corroborated by employment records, salary documents, attendance registers, appointment letters, and payment vouchers.

The Court relied on National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, holding that a self-employed person or a person in non-permanent employment below 40 years of age is generally entitled to future prospects of 40%, rather than 50%.

Compensation for loss of future earnings is computed by applying the claimant’s income, future prospects, the appropriate multiplier, and the percentage of functional disability.

The site plan showed that the point of impact was nine feet from the left edge of a 25-foot-wide road, placing the claimant within his proper half of the carriageway. The road was curved and the DTC bus appeared to have failed to negotiate the S-shaped curve, while the motorcycle was found at another location after the collision. The Court therefore rejected the allegation of contributory negligence.

The claimant’s monthly income of ₹20,000 was supported by the testimony of the employer’s accountant, the appointment letter, attendance register, salary slips, and payment vouchers. The Court also held that the claimant’s designation as “Junior Engineer” was not decisive merely because he possessed a B.A. degree, since private contractors may use that designation loosely.

However, because the claimant was 28 years old and did not hold a permanent job, the Court applied 40% future prospects in accordance with Pranay Sethi, instead of 50%.

Applying the existing multiplier of 17 and functional disability of 20%, the loss of future earnings was recalculated from ₹12,24,000 to ₹11,42,400.

The total compensation was accordingly reduced from ₹18,47,608 to ₹17,66,008, representing a reduction of ₹81,600.

The excess amount deposited, together with accrued interest, was directed to be refunded to the insurance company, while the balance amount in the fixed deposits was directed to be released to the claimant in lump sum.

The appeal was disposed of on these terms, and pending applications were rendered infructuous.