For four dependents, only one-third of the deceased’s income may be deducted for personal expenses.

In brief

The question

1. Whether the deceased’s monthly income should be assessed at the applicable minimum wage rather than the amount assessed by the Tribunal.

The court held

The appeal was partly allowed.

It also directed

The award was enhanced from ₹5,77,320 to ₹10,16,832, leaving an additional ₹4,39,512 payable to the appellants with interest at 6% per annum from the date of filing the claim application until realization; the remaining terms of the Tribunal’s award were left unchanged.

The Registry was directed to communicate the enhanced amount to the claimants in Hindi, with paralegal assistance if required.

01Facts

The appeal under Section 173 of the Motor Vehicles Act, 1988 challenged the Claims Tribunal’s award of ₹5,77,320 for the death of Shobharam Darro, aged about 60, in a road accident on 23 March 2023

¶ 1

The claimants sought enhancement, arguing that the Tribunal had understated the deceased’s income, deducted an excessive share for personal expenses, and awarded too little under conventional heads

¶ 2

02Issues

i.1. Whether the deceased’s monthly income should be assessed at the applicable minimum wage rather than the amount assessed by the Tribunal.

¶ 2, 5

ii.2. Whether the deduction for the deceased’s personal and living expenses should be one-third rather than one-half, having regard to the claimants and dependants.

¶ 2, 5

iii.3. Whether the compensation awarded under conventional heads should be enhanced.

¶ 2, 5

03Law Applied

Section 173 of the Motor Vehicles Act, 1988 provides for an appeal against a Claims Tribunal award.

¶ 1

In assessing compensation, the Court relied on Sarla Verma & Ors. v. Delhi Transport Corporation & Ors., (2009) 6 SCC 121, and applied a one-third deduction for personal and living expenses in light of the number of claimants and dependants.

¶ 5–6

It also relied on National Insurance Company Ltd. v. Pranay Sethi, (2017) 16 SCC 680, and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram & Ors., (2018) 18 SCC 130, in computing future prospects and conventional heads.

¶ 6

The Court assessed income by reference to the applicable minimum-wage notification for unskilled labour.

¶ 5

Provisions in the judgment · 1 · Linked ones open on LawLens

Motor Vehicles Act, 1988 Section 173

04Reasoning

The claimants’ assertion that the deceased earned ₹12,000 per month was unsupported by credible evidence. However, the Court found that the minimum monthly wage for unskilled labour on the accident date was ₹9,960 and used that figure instead of the Tribunal’s assessment of ₹7,800.

¶ 5

Given the number of claimants and dependants, it reduced the deduction for personal expenses from one-half to one-third.

¶ 5

Applying a 10% addition for future prospects and a multiplier of nine, and enhancing the conventional-heads award from ₹1,14,000 to ₹2,28,000, the Court recalculated total compensation at ₹10,16,832.

¶ 5–6