Motor accident compensation must be calculated using the prevailing minimum wage applicable to unskilled labour.

Late Triloki Yadav died in a motor accident on 25 February 2022 involving motorcycle No. C.G.11/A.L.4886, owned by Respondent No. 2 and driven by Respondent No. 1; Respondent No. 3 was the insurer.

His parents, Tiharu Ram Yadav and Basant Kumari Yadav, filed a claim petition before the Motor Accident Claims Tribunal.

They asserted that the deceased was a skilled mechanic earning Rs.22,000 per month, but produced no documentary evidence to establish that income.

The Tribunal treated him as an unskilled labourer and assessed his monthly income at Rs.7,855, while applying 40% future prospects, a 50% deduction for personal expenses, and a multiplier of 18.

The claimants appealed under Section 173 of the Motor Vehicles Act, 1988, seeking enhancement.

Whether the Tribunal correctly assessed the deceased’s monthly income, or whether it required enhancement in accordance with the applicable Chhattisgarh minimum-wage notification?

Whether the Tribunal correctly applied future prospects, deduction for personal expenses, multiplier, and amounts under the conventional heads of compensation?

Whether the compensation awarded by the Tribunal contained a computational error and, consequently, what was the correct total compensation payable to the claimants?

The Court exercised appellate jurisdiction under Section 173 of the Motor Vehicles Act, 1988, permitting challenge to an award of the Motor Accident Claims Tribunal.

In assessing compensation for death, it applied the principles in National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, including the addition of future prospects and standardized amounts under conventional heads; Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, concerning deduction for personal expenses and selection of the multiplier; and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 1305, concerning consortium payable to eligible claimants.

Where the claimed income was unsupported by documentary evidence, the Court assessed income on the basis of the applicable minimum-wage notification issued by the Labour Commissioner, Chhattisgarh, taking Rs.9,280 per month as the income of an unskilled labourer.

The Court rejected the claim of Rs.22,000 monthly income because the claimants had produced no documentary proof that the deceased was earning that amount as a skilled mechanic.

However, it found that the Tribunal had used an outdated or incorrect minimum-wage figure of Rs.7,855 and substituted Rs.9,280 per month, as prescribed for an unskilled labourer under the applicable Chhattisgarh notification.

Applying the accepted 40% addition for future prospects, the annual income became Rs.1,55,904; after deducting 50% for personal expenses, the annual contribution to the dependants was Rs.77,952.

Applying the multiplier of 18 resulted in Rs.14,03,136 towards loss of dependency.

The Court found no reason to interfere with the Tribunal’s treatment of the deceased as self-employed, the 40% future-prospects addition, the 50% deduction, or the multiplier of 18.

It also affirmed Rs.96,000 for consortium to two claimants, Rs.18,000 for loss of estate, Rs.18,000 for funeral expenses, and Rs.54,607 towards medical expenses.

The resulting total was Rs.15,89,743.

The Court further corrected the Tribunal’s stated award amount, treating the actual amount awarded as Rs.13,74,283 rather than the incorrectly calculated figure of Rs.14,24,283.

The compensation was enhanced from Rs.13,74,283 to Rs.15,89,743, granting the claimants an additional Rs.2,15,460.

The enhanced amount was directed to carry interest at 6% per annum from the date of filing of the claim application until realization.

All other terms of the Tribunal’s award were maintained, and the insurer’s cross-objection was disposed of.

The Registry was directed to communicate the enhanced amount to the claimants in Hindi, with assistance from paralegal workers and the concerned Legal Aid authority, if necessary.