Motor accident compensation multiplier must be based on the deceased’s age, not the claimants’ age.

The claimants appealed the Motor Accident Claims Tribunal, Harda’s award dated 22 March 2025 in MACC No. 101 of 2024.

They challenged the Tribunal’s calculation of compensation, contending that it had selected the multiplier by reference to the claimants’ ages rather than the deceased’s age, and had calculated income and personal expenses without applying the governing principles.

The deceased, a Home Guard, died in an accident on 1 April 2024. His date of birth was 12 April 1983, and his monthly salary was Rs. 29,250.

The insurer’s counsel supported the claimants’ submissions.

1. Whether the Tribunal erred by applying a multiplier based on the claimants’ ages rather than the deceased’s age.

2. Whether the Tribunal erred in calculating the deceased’s income, future prospects, and personal and living expenses when determining dependency compensation.

In Sarla Verma v. Delhi Transport Corporation and Another, AIR 2009 SC 3104, the Supreme Court explained that dependency compensation is calculated by determining the deceased’s contribution to dependants after deducting personal and living expenses, then capitalising that multiplicand by an appropriate multiplier; the deceased’s age is the basis for selecting the multiplier.

General Manager, Kerala State Road Transport Corporation v. Susamma Thomas, 1994 (2) SCC 176, likewise describes the multiplier method and the assessment of dependency.

U.P. State Road Transport Corporation v. Trilok Chandra, 1996 (4) SCC 362, addressed the applicable multiplier table.

National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, confirms that the deceased’s age is the basis for applying the multiplier.

The Court also applied the principles governing future prospects and deductions for personal expenses, including the 50% deduction applicable to a bachelor.

The Tribunal had referred to Pranay Sethi but did not apply its rule that the deceased’s age governs multiplier selection.

The deceased was 40 years old at the time of the accident, having not yet turned 41; the Court therefore applied a multiplier of 15.

Taking the monthly salary of Rs. 29,250, the Court added 30% for future prospects, producing annual income of Rs. 456,300.

Because the deceased was a bachelor, it deducted 50% for personal and living expenses, then applied the multiplier of 15.

This yielded pecuniary compensation of Rs. 3,422,250, in place of the Tribunal’s Rs. 1,140,750.

It directed that the enhanced amount be invested in a monthly income scheme of an Indian Post Office or nationalised bank in the claimants’ joint names for seven years, with the claimants entitled to use the monthly interest and withdraw the principal after that period.

The appeal was disposed of accordingly.