For four dependants, deduct one-fourth of income for personal expenses and add 40% future prospects for a deceased under 40.

The claimants, the wife, son, mother and father of the deceased, sought compensation after he died from injuries sustained in a motorcycle–car collision on 23 November 2008.

The Motor Accident Claims Tribunal awarded ₹4,52,000, assessing the deceased’s monthly income at ₹3,000, deducting one-third for personal expenses, and applying a multiplier of 16.

The Tribunal’s finding that the accident resulted from the car driver’s rash and negligent driving was not challenged and had attained finality.

1. Whether the Tribunal correctly assessed the deceased’s income at ₹3,000 per month despite the claimants’ assertion that he earned ₹7,000 per month

2. Whether the Tribunal correctly calculated the dependency loss, including deductions for personal expenses and addition for future prospects

3. Whether the claimants were entitled to compensation under conventional heads, including consortium, and interest from the date of filing the claim petition

Under Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, personal and living expenses are generally deducted at one-fourth where the deceased leaves four to six dependants.

Under National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, a self-employed person or person on a fixed salary below 40 years of age is entitled to a 40% addition to established income for future prospects.

New India Assurance Co. Ltd. v. Somwati, (2020) 9 SCC 644, recognises spousal, parental and filial consortium, and the applicable conventional heads include loss of estate and funeral expenses.

The Court also referred to Neelam v. Ganga Singh, 2026 SCC OnLine SC 888, as reiterating the principles on consortium.

The Court upheld the Tribunal’s ₹3,000 monthly income assessment because the claimants had not proved the asserted higher income and the amount was consistent with the minimum wage for a skilled worker at the relevant time.

However, because the deceased left four dependants, the Tribunal should have deducted one-fourth, rather than one-third, for personal expenses. Given the deceased’s age of 36, a 40% addition for future prospects was also required.

Applying these principles, the Court calculated dependency compensation using an annual income of ₹36,000, increased to ₹50,400, a multiplier of 16 and a one-fourth deduction. It then added consortium for four claimants, loss of estate and funeral expenses.

The enhanced amount was made payable with interest at 7% per annum from the date of filing the claim petition until realisation.

The wife was allocated 50% of the compensation, with the remainder divided equally among the other three claimants; any amount already paid was to be adjusted. The insurer was directed to pay within two months.