Gross salary for dependency calculation must exclude voluntary deductions but include loss of supervisory business income.

On November 8, 2004, the deceased, Dayabhai Ahir, was fatally struck by a Maruti car while walking near Motiwada National Highway.

The Motor Accident Claims Tribunal (MACT), Valsad, awarded Rs. 5,55,760/- as compensation in 2008.

The claimants appealed for enhancement, arguing that the Tribunal erred in deducting PF, VPF, and other charges from the gross salary and failed to account for agricultural/dairy income and future prospects.

At the time of the death, the deceased was 53 years old, working as a Plant Operator, and allegedly earning additional income from supplying milk (owning 16 cows) and leasing tractors.

1. Whether the learned Tribunal erred in law by deducting PF, VPF, LIP, and CCS from the gross salary of the deceased while calculating net income.

2. Whether the deceased’s income from dairy farming and tractor rentals should be included in the dependency calculation.

3. Whether the claimants are entitled to 15% future prospects and higher compensation under conventional heads like loss of consortium and estate.

Statutory deductions like PF, VPF, and insurance cannot be subtracted from gross salary for compensation, leaving only Income Tax and Professional Tax as permissible deductions as per Vimal Kanwar v. Kishore Dan (2013).

A 15% addition for future prospects is applicable for salaried/fixed-income persons aged 50-60 and conventional heads are standardized as per National Insurance Co. Ltd. v. Pranay Sethi (2017).

Parental and lifestyle consortium is to be awarded to all legal representatives as per Magma General Insurance Co. Ltd. v. Nanu Ram (2018).

The High Court found the Tribunal’s methodology fundamentally flawed regarding salary deductions, noting that only Rs. 60/- Professional Tax should have been deducted from the gross salary of Rs. 11,595/-.

Regarding supplementary income, the Court reviewed dairy receipts and tractor registration documents, concluding that the claimants suffered a loss of "supervisory income" as the cows and tractors were sold following the death.

Consequently, the Court reassessed the total monthly income at Rs. 15,000/- and applying the age-based multiplier of 11 and a 1/4th deduction for personal expenses, the Court recalculated dependency.

The Court also rectified the omission of medical expenses and pain/suffering compensation, as the deceased survived for a period after the accident before succumbing to injuries.

The Court held that the additional amount of Rs. 13,91,824/- shall carry interest at 7.5% per annum from the date of the claim petition and directed the Insurance Company to deposit the enhanced amount within six weeks.