Motor accident compensation was enhanced by reasonably fixing the unorganised worker’s monthly income at Rs.8,000.

On 25 November 2008, A. Mallesh was riding his motorcycle towards Ghatkesar when a Honda Shine motorcycle, allegedly driven rashly and negligently at high speed, struck his vehicle from behind near Sri Harsha Super Market, Uppal Bus Depot. Mallesh sustained grievous injuries and died while being taken to the hospital.

His wife and two daughters instituted a claim petition under Section 166 of the Motor Vehicles Act, 1988, seeking compensation of ₹12,00,000. The Motor Accidents Claims Tribunal held the accident to have resulted from the rash and negligent driving of the offending motorcycle and awarded ₹6,50,000 with interest at 7.5% per annum. The claimants appealed, seeking enhancement of compensation.

Whether the compensation awarded by the Tribunal under the head of loss of dependency was inadequate and required enhancement?

Whether, having regard to the deceased’s age, occupation, income and number of dependants, the compensation should be recalculated by applying an income of ₹8,000 per month, deducting one-third towards personal expenses, and applying the multiplier of 15?

Whether the claimants were entitled to compensation under conventional heads in accordance with National Insurance Co. Ltd. v. Pranay Sethi?

The Court applied Section 166 of the Motor Vehicles Act, 1988, which permits dependants of a person who dies in a motor accident caused by the negligence of the offending vehicle’s driver to claim just compensation.

For quantifying loss of dependency, the Court assessed the deceased’s probable income, deducted one-third towards personal and living expenses because he left three dependants, and applied the multiplier of 15 applicable to the deceased’s age group of 36–40 years.

The Court further relied on National Insurance Co. Ltd. v. Pranay Sethi, (2017) 16 SCC 680, for awarding compensation under conventional heads.

The finding that the accident was caused by the rash and negligent driving of the first respondent had attained finality and was not challenged in the appeal.

Although the Tribunal had assessed the deceased’s monthly income at ₹5,000, the evidence indicated that he worked as both a cable operator and a banner designer, with claimed earnings of ₹7,000 and ₹6,000 respectively. Considering the nature of his avocations and the fact that he was an unorganised worker, the Court determined a reasonable monthly income of ₹8,000. The annual income was therefore ₹96,000; after deducting one-third, or ₹32,000, towards personal expenses, the annual contribution to the family was ₹64,000. Applying the multiplier of 15 resulted in ₹9,60,000 towards loss of dependency. Adding ₹91,000 under conventional heads in accordance with Pranay Sethi produced a total compensation of ₹10,51,000.

The remaining terms and conditions of the Tribunal’s award were left undisturbed. No order was made as to costs, and pending miscellaneous petitions were closed.