Future prospects must be added at 40% when computing compensation for a deceased contractual worker.

On 23 September 2018, the deceased was travelling in an autorickshaw on the Rampurhat–Suri Pucca Road when a truck bearing registration no. WB-65B-3277, allegedly driven rashly and negligently, collided with the autorickshaw. The deceased sustained serious injuries and was declared “brought dead” at the hospital. A criminal case was instituted in relation to the accident.

The deceased’s wife, for herself and on behalf of their two minor children, filed MACC Case No. 14 of 2019 against the vehicle owner and insurer.

The Tribunal assessed the deceased’s notional monthly income at Rs. 5,000, applied a multiplier of 18, and awarded total compensation of Rs. 8,40,000, including Rs. 40,000 towards spousal consortium, with interest at 6% per annum from the date of filing of the claim application.

The claimants appealed, principally contending that the Tribunal had failed to account for future prospects and had not accepted the deceased’s asserted income of Rs. 6,000 per month as a municipal sweeper.

Whether the Tribunal erred in law by failing to add an appropriate amount towards the deceased’s future prospects while computing loss of dependency.

Whether, upon applying the law relating to future prospects, the claimants were entitled to enhancement of the compensation awarded by the Tribunal.

The Court applied Section 171 of the Motor Vehicles Act, 1988, governing the award of interest on compensation.

It relied on National Insurance Co. Ltd. v. Pranay Sethi for the principle that future prospects must be added to the deceased’s income while calculating loss of dependency, including in appropriate cases involving non-permanent or non-salaried employment.

It also applied the multiplier and personal-expense principles associated with Sarla Verma v. Delhi Transport Corporation.

The Court further relied on Rajwati @ Rajjo v. United India Insurance Co. Ltd., Civil Appeal No. 8179 of 2022, wherein the Supreme Court reaffirmed the addition of future prospects in accordance with Pranay Sethi and the deduction of personal expenses under Sarla Verma.

The Tribunal had assessed the deceased’s income at Rs. 5,000 per month, or Rs. 60,000 annually, and after deducting one-third towards personal expenses, calculated the annual dependency at Rs. 40,000.

Although the Tribunal calculated loss of dependency without any addition for future prospects, the High Court held that such addition was legally mandatory in light of Pranay Sethi and Rajwati @ Rajjo.

Applying a 40% addition to the annual income, the Court determined the enhanced annual income at Rs. 84,000, deducted one-third towards personal expenses, and applied a multiplier of 17, resulting in loss of dependency of Rs. 9,52,000.

After adding Rs. 84,000 towards general damages, the total compensation was recalculated at Rs. 10,36,000.

Since the insurer had already paid Rs. 8,40,000 pursuant to the Tribunal’s award, the balance enhancement was Rs. 1,96,000.

The insurer was directed to pay the additional sum of Rs. 1,96,000, together with interest at 6% per annum from the date of filing of the claim application until the date of the High Court’s order, by account-payee cheque in favour of the Registrar General, High Court at Calcutta, within four weeks.

The Registrar General was directed to disburse the amount among the claimants in the ratio specified in the Tribunal’s award, subject to identification and necessary formalities.

The appeal was accordingly disposed of.