Post-retirement pension must be included with agricultural income to assess loss of dependency.

On 30 September 2020, Dhirabhai Maganbhai Baria was walking beside the road near the Bank of Baroda at Village Raliyata Dungri when a motorcycle allegedly driven rashly and negligently by respondent No.1 struck him. He sustained serious injuries and subsequently died.

His six legal heirs filed M.A.C.P. No. 172 of 2020 before the Motor Accident Claims Tribunal, Panchmahals at Godhra, claiming ₹22,50,000 as compensation.

The Tribunal partly allowed the claim petition by judgment dated 6 December 2024 and awarded ₹6,52,531 with interest at 9% per annum from the date of the claim application.

In the appeal, the claimants challenged the quantum, contending that the deceased’s monthly pension of ₹14,475, in addition to agricultural income of ₹8,437 per month, ought to have been included in the computation of loss of dependency.

Whether the deceased’s monthly pension should be added to his agricultural income while calculating the loss of dependency?

Whether the deduction towards personal expenses and the multiplier applied by the Tribunal were appropriate for determining the loss of dependency?

Whether the compensation under loss of consortium, funeral expenses, and loss of estate required enhancement under the applicable Supreme Court precedents?

The Court applied the principles governing compensation under the Motor Vehicles Act, 1988, particularly the assessment of pecuniary loss and conventional heads in fatal motor-accident claims.

Relying on Vimal Kanwar v. Kishore Dan, 2013 ACJ 1441, Sebastiani Lakra v. National Insurance Co. Ltd., 2019 ACJ 34, and Hanumantharaju B. (Dead) by LRs v. M. Akram Pasha, 2025 INSC 682, it held that pension received by the deceased could be considered along with agricultural income for assessing the income relevant to dependency.

The Court applied a one-fourth deduction for personal expenses because the deceased was survived by six legal heirs, and applied a multiplier of 7 considering his age of approximately 62 years.

It further relied on National Insurance Co. Ltd. v. Pranay Sethi, AIR 2017 SC 5157, for funeral expenses and loss of estate, and Magma General Insurance Co. Ltd. v. Nanu Ram @ Chuhru Ram, (2018) 18 SCC 130, for consortium payable to the widow and son.

The Court found that the deceased was undisputedly receiving a monthly pension of ₹14,475 from Western Railways and was also earning ₹8,437 per month from agriculture. Applying the cited authorities, it held that the pension could not be ignored and aggregated both amounts to arrive at a monthly income of ₹22,912.

After deducting one-fourth for personal expenses, the monthly dependency loss was calculated at ₹17,184. Since the deceased was about 62 years old, the Court applied a multiplier of 7, resulting in ₹14,43,456 for future loss of dependency.

It additionally awarded ₹96,800 towards consortium to the widow and son at ₹48,400 each, and enhanced funeral expenses and loss of estate from ₹16,500 each to ₹18,150 each in accordance with the applicable precedents.

The total compensation was therefore recalculated at ₹15,76,556, compared with the Tribunal’s award of ₹6,52,531.

The Insurance Company was directed to deposit the enhanced compensation with interest at 9% per annum from the date of filing of the claim petition until realization, excluding the period of delay in filing the appeal.

The deposit was to be made before the concerned Tribunal within six weeks, which was directed to disburse the awarded amount after verification and deduction of any deficit court fee.

No order as to costs was made.