Future prospects for a 36-year-old non-permanent worker are limited to 40%.

The Insurance Company challenged the award dated 30 January 2016 passed by the Motor Accident Claims Tribunal, North-East District, Karkardooma Courts, Delhi, in MACT No. 49/2010, which awarded the claimants compensation of ₹42,19,450 with interest at 9% per annum.

The deceased was 36 years old and was engaged in business.

The Tribunal assessed his annual income at ₹2,59,630 on the basis of his Income Tax Return for assessment year 2008–09, added 50% towards future prospects, applied a multiplier of 15, and awarded amounts under various non-pecuniary heads.

The High Court also noted that the income-from-house-property objection had not been raised before the Tribunal in the written statement or during cross-examination.

1. Whether the annual income of the deceased, including the amount reflected as income from house property, was correctly taken at ₹2,59,630 for computing loss of dependency?

2. Whether future prospects were required to be assessed at 40%, instead of 50%, since the deceased was 36 years old and not in permanent employment?

3. Whether the amounts awarded under loss of love and affection, loss of consortium, loss of estate, and funeral expenses required modification in light of Sarla Verma, Pranay Sethi, and subsequent Supreme Court authority?

The Court applied the principles governing computation of motor accident compensation under the Motor Vehicles Act, including assessment of actual or established income, deduction towards personal expenses, addition for future prospects, and application of the appropriate multiplier.

Relying on Sarla Verma v. DTC, (2009) 6 SCC 121, and National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, the Court held that a self-employed person aged below 40 years is ordinarily entitled to a 40% addition for future prospects, and that compensation under conventional heads must conform to settled principles.

It further relied on United India Insurance Co. Ltd. v. Satinder Kaur @ Satwinder Kaur, (2021) 11 SCC 780, for deleting the separate award for loss of love and affection and standardising compensation for consortium.

The Court declined to interfere with the income assessed by the Tribunal.

It observed that the Insurance Company had not pleaded or put the income-from-house-property issue to the relevant witnesses before the Tribunal.

In any event, the claimants stated that the property had been sub-leased under the Bawana Relocation Scheme, that the rental income had ceased after the deceased’s death, and that the family was embroiled in disputes concerning the property.

The Court also considered the deceased’s business activities and the widow’s specific, though unsupported, assertion that he earned approximately ₹90,000 per month, concluding that the Tribunal’s assessment of ₹2,59,630 annually—approximately ₹2,000 per month—was neither excessive nor disproportionate.

However, applying the settled principles on future prospects and conventional heads, the Court reduced the future-prospects addition from 50% to 40%; deleted ₹1,00,000 awarded for loss of love and affection; reduced consortium to ₹80,000 for two claimants; and fixed loss of estate and funeral expenses at ₹15,000 each.

The revised loss of dependency was calculated at ₹36,34,815, resulting in total compensation of ₹37,44,815.

The Court upheld the annual income of ₹2,59,630 and the multiplier of 15, but reduced the total compensation from ₹42,19,450 to ₹37,44,815 by applying 40% future prospects and revising the conventional heads.

Interest was maintained at 9% per annum.

The excess amount deposited by the Insurance Company was directed to be refunded with accrued interest, while the revised compensation with accrued interest was ordered to be released to the claimants through their designated bank accounts within four weeks.

The appeal was disposed of accordingly, and the statutory deposit was directed to be refunded to the Insurance Company.