Motor accident compensation must reflect notified minimum wages and enhanced conventional heads under settled Supreme Court principles.

Abhishek Narange, aged approximately 23 years and unmarried, died in a motor-vehicle accident on 2 February 2021 involving Pickup No. CG-10/AF/0301.

His mother, Pushpalata Narange, and sister, Aanamika Narange, filed a claim petition against the driver, owner, and insurer of the offending vehicle. The Third Additional Motor Accident Claims Tribunal, Bilaspur, awarded total compensation of ₹12,56,360 by its award dated 16 September 2022. The claimants filed the present appeal under Section 173 of the Motor Vehicles Act, 1988, seeking enhancement on the grounds that the deceased’s income had been assessed too low and that inadequate amounts had been awarded under conventional heads, including consortium.

The insurer opposed the appeal and submitted that the Tribunal’s award was just and proper.

1. Whether the deceased’s monthly income was required to be reassessed in accordance with the applicable Chhattisgarh minimum-wage notification, thereby increasing the loss-of-dependency compensation.

2. Whether the compensation awarded under the conventional heads was inadequate and required enhancement in accordance with governing Supreme Court precedent.

3. Whether the claimants were entitled to an enhanced total compensation and interest on the additional amount.

The Court applied Section 173 of the Motor Vehicles Act, 1988, governing appeals against awards of Motor Accident Claims Tribunals.

For computation of compensation, it relied on National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, concerning future prospects and conventional heads; Sarla Verma v. Delhi Transport Corporation, (2009) 6 SCC 121, concerning the multiplier and deduction for personal expenses; and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 1304, concerning consortium.

The Court applied a 40% addition for future prospects, a one-half deduction towards the deceased’s personal expenses because he was unmarried, and the multiplier of 18 applicable to his age.

The deceased’s income was assessed with reference to the Chhattisgarh minimum-wage notification issued by the Labour Commissioner.

The Court found that the Tribunal had assessed the deceased’s monthly income at ₹7,800, whereas the applicable minimum-wage notification supported an income of ₹8,960 per month.

Applying the 40% future-prospects addition, the annual income increased from ₹1,07,520 to ₹1,50,528. Since the deceased was unmarried, one-half was deducted for personal expenses, resulting in an annual dependency figure of ₹75,264. Applying the multiplier of 18, the loss of dependency was calculated at ₹13,54,752.

The Court further held that the Tribunal’s award of ₹77,000 under conventional heads was inadequate and enhanced it to ₹1,21,000, relying on the principles in Pranay Sethi and Magma General Insurance.

The recalculated compensation therefore amounted to ₹14,75,752, as against the Tribunal’s award of ₹12,56,360.

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 and conditions of the Tribunal’s award were maintained.

The Registry was also directed to communicate the enhanced amount to the claimants in Hindi, with assistance from paralegal workers where necessary.