Motor accident compensation must include future prospects and conventional heads.

The appellants, dependants of Giridhari Behura, appealed under Section 173(1) of the Motor Vehicles Act, 1988, against the Tribunal’s award of ₹3,24,000 with 7% interest in a fatal-accident claim under Section 166.

They challenged the deceased’s assessed income, the omission of future prospects, and the interest rate.

The Tribunal had found that the driver lacked a valid driving licence at the time of the accident and granted the insurer a right to recover the compensation from the vehicle owner.

The insurer’s separate appeal was dismissed as time-barred.

1. Whether the Tribunal’s assessment of the deceased’s income and its failure to award future prospects and appropriate conventional damages required modification.

2. Whether the interest rate of 7% should be reduced in light of the delay in the proceedings and the appellants’ conduct.

3. Whether the Tribunal’s finding granting the insurer a right to recover from the owner should be disturbed.

Under Section 173(1) of the Motor Vehicles Act, 1988, the High Court may hear an appeal against a Tribunal’s award; a claim for compensation arises under Section 166.

The Court applied Sarla Verma & Ors. v. Delhi Transport Corporation & Anr., (2009) 43 OCR (SC) 349, for the multiplier corresponding to the deceased’s age and the deduction for personal and living expenses.

It applied National Insurance Company Ltd. v. Pranay Sethi & Ors., (2017) 16 SCC 680, for adding future prospects to the income of a self-employed person or person on a fixed salary, and for conventional heads of compensation.

The Court also upheld the insurer’s right to recover where the insured vehicle was entrusted to a driver without a valid licence, a breach of policy conditions.

The Court accepted the Tribunal’s monthly income assessment of ₹3,000, finding no concrete evidence to support the claimed higher income.

With annual income of ₹36,000, a one-third deduction for personal expenses and a multiplier of 11, the loss of dependency was ₹2,64,000.

Applying Pranay Sethi, it added 10% for future prospects and awarded ₹1,26,000 under conventional heads, producing total compensation of ₹4,16,400.

It reduced interest to 4% because the appellants’ failure to remove defects had contributed to prolonging the appeal, while noting the lengthy overall pendency of the claim and appeal.

The insurer’s recovery right remained undisturbed because the driver’s licence was not valid on the accident date, the owner had not appealed, and the insurer did not challenge that finding in this appeal.

The insurer was directed to pay the appellants ₹4,16,400 with simple interest at 4% per annum from 31 July 2002, within eight weeks, with disbursement proportionate to the Tribunal’s award.

The insurer retained the right to recover the amount from the vehicle owner in accordance with law.